Instalco AB (publ)

Welcome to this presentation of Instalco's fourth quarter and the full year 24 report. My name is Robin Bowman, CEO of Instalco and with me today I have our CFO Kristina Casperi. Let's kick off as usual with a short summary of the company today. Instalco is one of the leading installation groups in the market Sweden, Norway and Finland. And since very recently we also have a presence in Germany. As you know we operate in a very decentralized model but with strict control mechanisms in place. In total we have over 6,000 employees working every day to help facilitate the green transformation. Demand for services we offer is supported by several strong underlying market drivers. As we now move into Q4, the LTM numbers also reflect the full year 24. Net sales amounted to 13.7 billion and we ended the year with an order backlog of 9 billion which represents a book to build of 66%. When adjusting for runoff costs taken in Q4, our EBITDA amounted to 944 million corresponding to a margin of .9% compared to .6% in 2023. This is still a bit low but does show our strong resilience in a very challenging market over the last year. Part of the resilience can be explained by our quick adaptation by our subsidies to service. Which has covered some of the shortfalls on the project side. So for the full year service represents 35% of our revenue compared to 30% for full year 2023. I am also pleased to see that our cash flow from operations has held up and is down by less than our earnings. Showcasing our strong focus on improving working capital. Let's go in and move into a few of the highlights from the quarter. We have been facing as I said before a very challenging market all through 24. We have during the year taken measures in various subsidiaries and adapting operations with efficiency improvements and cost savings. We intensify those efforts in Q4 to strengthen our long term competitiveness. This includes both further layoffs as well as starting to merge and closing down eight loss making subsidiaries. This initiative will gradually take effect during the coming year and result in a one off cost in the fourth quarter. In parallel with this work we have also taken several major offensive steps in install cost development during the year. And I must say the most significant one came in November in 24 when we took the first step into Germany by signing an agreement for minority investment in Fabry Group. Fabry is a decentralized acquisition driven installation group and we have a long term plan of achieving majority ownership. Further our technical consultants at Intec continue to deliver margins above the group. And last year we also added automation and taking important steps there as well. We recently announced that Inmatik, which is our automation business, is the first in Sweden to enter into the highest level of partnership with Siemens Smart Infrastructure Business Area at the national level. This is a strategic step for us as well as confirming that our build up of Inmatik is showcasing good strong long term work. Energy efficiency and lower consumption of resources provided the foundation of our services that Instalco offers today. We have also noticed a growing interest from our investors but also from customers regarding measurement and reporting of greenhouse gas emissions. This has been a priority during the year and we were also now prepared for the CSRD reporting. We announced our climate targets in December, which Kristina will go through in more detail shortly. So it sums up and will make our customer offer even more attractive I would say. But now I would like to hand over to you Kristina to take us through the financials development in more detail.

Thank you Robin. Let's start off with looking at how our net sales and order backlog has developed during Q4. Net sales was down by .8% to 3.6 billion with an organic development of minus 7.4%. The organic growth was down in both segments but more in Sweden. For the group this is a reflection of our prudent order taking over the last year given the price situation in the market. Our order backlog however grew by .7% in the quarter all organically. The improvement is driven by segment Sweden while the rest of Nordics was down somewhat. We have maintained our cautious approach to order taking prioritizing the right projects at the right price for the right customers. There are more projects available in the market which may be an indication that the market is showing signs of turning. But the importance to be prudent on calculations remains. Our subsidiaries have continued to impress when it comes to shifting staff to service when there is not enough attractive project business to go for. And service remains an important stabilizing factor. For the full year the service business grew over 10% in absolute numbers. In the quarter service made up at record high 41% of sales. And as Robin mentioned earlier it grew from 30 to 35% of sales for the full year 2024. Then on to looking at our earnings EBITDA in both millions and margin. To meet the challenges posed by the market we have taken action continuously throughout the year. Our efforts were intensified in December when we announced an action program including further layoffs, some project write downs and initiation of mergers and closure of eight loss making subsidiaries. This resulted in one of costs of 65 million which were charged to EBITDA in the fourth quarter. EBITDA was also affected by additional one of costs impairment of goodwill and other intangible assets of 29 million due to closure of subsidiaries. So total one of impacting EBITDA was 94 million SEC. The fourth quarter tends to be seasonally strong in the installation business. In the quarter the EBITDA margin amounted to .4% compared to 8% last year. The lower margins is a result of one of costs and the current market situation. Adjusted for the one of costs the EBITDA margin amounted to 7.2%. This is a step up from Q3. The adjusted numbers this quarter represent .8% margin drop year over year compared to .4% margin drop in Q3. To break it down into more detail over to a slide that summarizes segment Sweden in Q4. Overall net sales were down to 2.5 billion while organic growth was down by 9%. The one of costs relating to Sweden amounted to 54 million. Adjusting for this the EBITDA margin amounted to .7% compared to .1% last year. Without adjustments the margin came in at 5.5%. For the full year, Intex technical consultants was the only business area that reported a stronger margin. The development in other business areas in Sweden varied quite a bit between regions. The order backlog grew organically by almost 10% to roughly 7 billion. We have noticed the market is starting to move a bit. There are more projects to calculate on. Even so, we are still following our current strategy of choosing the right customer and the right assignment at the right price. We have not dropped that principle. And now for a summary of the rest of Nordics segment. Overall net sales were down to 1.15 billion while organic growth was down by 3%. In line with the year over year decline we saw in Q3. Acquisitions contributed with a growth of around 1%. The one of costs relating to rest of Nordics amounted to 11 million. Adjusting for this, the EBITDA margin amounted to .0% compared to .3% last year. Without adjustments the margin came in at 5%. Both Norway and Finland improved the full year margins compared to 2023. The order backlog decreased organically by .6% to 2.18 billion. And here we see the backlog growing for Finland while Norway decreased slightly. Then on to the cash generation in the quarter. In Q4 cash flow from operations amounted to 471 million, an increase compared to last year despite the lower earnings. The positive development is mainly due to improved working capital related to accounts receivables. Adjustments for non-cash items was notably higher due to depreciation and mortization including parts of the one of costs. This affected earnings but does not impact the cash flow. Cash flow from investment activities is mainly impacted by normal capex investments. No acquisitions have been finalized in the quarter as the minority investment in Fabri is yet too close. And the majority of the purchase price will be paid in newly issued in Stalko shares. The cash flow from the period looks low due to larger repayment of debt. The operational performance is reassuring to see that despite the challenging market we are reporting stable cash conversion at 89%. Finally, we look at our performance during the full year 2024 in relation to our financial targets. For those of you who have listened in on all calls during the year, you are familiar with the challenging installation market that has signified 2024. We have intentionally been very selective when taking on projects to protect our margins as much as possible and we have remained cautious on acquisitions. This has led to an organic development of net sales of minus .5% for the full year, which is below the 10% target, the targets which is set over a business cycle. So looking over the past five years, we report a compounded annual growth rate of close to 14%. Our adjusted EBITDA margin came in at 6.9%. We are not satisfied and we have increased our mitigation efforts in Q4 as previously touched upon. The measures will gradually take effect during the coming year. Cash conversion remained stable at 89% due to the high focus on working capital. At year end, our leverage came in somewhat above our target at 2.7 times EBITDA. This is primarily attributable to the decrease in earnings. And as this is a year end report, the board proposes a dividend of 0.68 SEC, maintaining the level of last year. This is above the 30% policy due to the strong cash flow and forward-looking optimism. Finally, we have a new target on this slide. In December, we announced our climate target, which we will follow up on annually. Long term, our goal is net zero in the entire value chain by 2045. And in the medium term, our goal is to decrease the emission intensity of greenhouse gas emissions in scope one and scope two by 50% by 2030, with 2020 as the base year for comparison. We will publish more information on this and our progress, of course, in the annual report for 2024. So, by that, over to you, Robin. Thank

you very much, Kristina. Going into the project highlight of the quarter. This one from Finland. Two installco subsidiaries, Kopio Elvetallo and Twin Putki Oy, were contracted on a joint assignment for installation at the major grocery store project in Kopio, a city situated south central in Finland. The project involves two companies. It's a new construction of approximately 12,000 square meters, and that is part of the end customers expansion to open several new stores in rapid growth areas. Installco subsidiaries have been contracted for the heating and plumbing, ventilation and sprinkler installations with the project value of approximately 4 million euros. In 2024, we have spent a lot of time on preparing for what I call the next big step for installco. So this quarter's theme is a no brainer. Given that we have explained and expanded outside of our three markets and gone into a new country. This is obviously the theme for the quarter. I will keep this deep dive relatively short as there is a full telco available on our website from the announcement in November 13. But I will come comment and cover some small updates. First of all, Fabri is a fast growing group founded in 2020 with the presence in several locations in the fragmented German market. The company's acquisition driven with a decentralized model and has subsidiaries with specialist experience in areas such as electrical, heating and plumbing, ventilation and related disciplines. Germany is one of Europe's largest installation market with the size of around five times the Nordic market where we are present at the moment. We have long said that we believe in the decentralized installco model and that it can work outside of the Nordics. And we think that remains true. We found out very early on in our research about Germany and the German market that it's important to local connections. So the key has to be has been actually to find the right local partner and entrepreneur. With Fabri, I'm happy to say that we've done so. Short around deal structure. Deal structure is set in four stages. The first step includes a capital increase whereby installco gets a minority stake of 24 percent. Due to administration timeline and some German bureaucracy, it has not yet been finalized, but we expect to close during Q1 this year. Step two will be acquiring a further 27 percent of the shares in Fabri, which will result in a majority shareholder of Fabri. And we will also include Fabri in installco consolidated financial statements. Based on the current estimates that we have, this is expected to occur no earlier than the first quarter in 26 and no later in the latest, so to say, in the second quarter of 27. The fourth and final step during the period is an option and it is running through 2030 to 2033. And this is also the first time that management can sell their shares, which means that they have remained a very, so to say, a very loyal investor for over 10 years in Fabri. This step by step approach ensures a successful establishment in Germany, wherein installco partners up with the founder and entrepreneurs to share the upside, but also the risk. Fabri is based in Nuremberg. I showed this slide in November, showcasing that the group employed 400 people and 12 subsidiaries across Germany with an annual turnover of approximately 70 million. And as said before, Fabri is a fast growing and acquisition driven. Since November, they have added two more companies to the group, which now consists of 14 subsidiaries, 500 people and 80 million in turnover. And as I've said before, in November, Fabri is the natural fit for us and our strategic vision. We operate on the same model to acquire and strengthen best in class installation companies. The company's culture is very similar. I'd even say that they're modeled on the installco way and we see great opportunities for collaboration. We can provide the best practice and knowledge based and knowledge sharing from our 10 year history of M&A strategy and business development within the installation industry. Through Fabri, we get a unique opportunity and a platform to continue the expansion and growth in Germany. With local knowledge of the market, it is a value creating expansion with greater risk minimization. Finally, I'd like to return to Q4 and also take the opportunity to go through some key takeaways from the quarter, but also the full year. To sum up, we are now closing the books on what was a very challenging year. Price pressure, weak demands due to high interest rates and macro factors, delayed project starts in large projects, customer bankruptcies and reduced change orders are a few of the obstacles we have met along the way. I'm proud of the quick adaptation of subsidiaries shown by the growth of the service business, both as share of net sales, but also an absolute number. Our decentralized model has been key in this, as well as the implementation and increased mitigation efforts that were taken during the year, but also increased in Q4. And the measures will gradually take effect during 2025. We now see that more products are available on the market, as Kristina said, also showcasing by our growing order backlog, which may be an indicator that the market is slowly showing some signs of turning. But it's important to state that we are still selective on taking projects and you need to remember that the installation business is late cyclical. But I now say that we are cautiously optimistic for a better future. And we're also positioned to capture the profitable growth when the market improves. We have invested in our offers, both on the technical consultancy side, that are reporting very strong numbers. And we are also aware that our automation business is showing proof of concept and our investment into Fabri ensures further M&A runway for at least 10 years to come. Also our climate targets that are part of our work and our more sustainable offer and will be another tool to strengthen the relationship with our customers. On the social side, our staff remains our most important asset. And during the quarter, we conducted an annual employee survey and I'm very happy to say that the report, we also improved our employee net promoter score to 31 from last year of already a very strong 30. This is quite a bit higher than the rest of the industry that we're active in. So we're very proud of that. To round off, I would also like to take the opportunity to thank customers and shareholders for the trust and most importantly, our employees for their efforts and engagement during the year. And with that, I would like to thank you for joining this call and I now open up for your questions.

To withdraw your question, please dial pound key 6 on your telephone keypad. The next question comes from Carl Ragnarstam from Nordia. Please go ahead.

Hello Carl.

Good morning. It's Carl here from Nordia. Hi. A couple of questions. So firstly, just to clarify on the write downs in the quarter, you took Särnäcki, right, but not North Vault. And is it possible to quantify the latter on the Swedish margin in the quarter? So let's start there.

Thanks. Sorry, there was a break. There was a bit of a hack in the... Could you please repeat the question, Carl?

Yes, sure. So looking at the write downs you're talking a little bit about in the quarter here, just to clarify it, you did not take North Vault, but you took the Särnäcki bankruptcy right as a write down. And also, what was the magnitude of the latter and as of now, do you think that you'll take North Vault in Q1 instead?

Okay. So first of all, to clarify, the 65 that we showcase in the report and that we also announced in December, that is due to closing down of these eight subsidiaries. And when it comes to Särnäcki, the local companies have taken the reserves that they need and, so to say, write downs or what you want to call it, or reserves within the local subsidiary. So that's already included in the numbers we report. We don't see any further risks of, so to say, need for write downs when it comes to Särnäcki. So that is, so to say, it's not adjusted for Särnäcki. These numbers are included Särnäcki. Was that all of your questions?

Sorry. I was a little bit about North Vault as well. Oh, sorry, yeah, yeah, yeah.

So North Vault is not taken. North Vault is still under Chapter 11. And so we still have the risk of North Vault. We still have a dialogue with them. Our goal is obviously to get the 60 million back. So we don't have a plan to write that down as of yet. But there's still a risk. Absolutely.

Okay, perfect. And looking at the percentage of completion in the quarter in relation to LTM sales, it came down 10 basis points, which is good to see. But still, it looks a little bit elevated considering that you've done write downs in the quarter. So is North Vault one factor behind the still a little bit elevated POC levels? Or are you comfortable with this level entering H1? Or should we expect a continued slight stream of minor project write downs here to adjust to the current market situation? Or how should we look at the POC here?

Our goal is always we go through the POC monthly. So some local subsidiaries are bound to go through their POC monthly and have to take up, so to say, a risk scenario on their accounting and also on their projects and evaluate on a monthly basis of what they think the end is going to look like. So I don't see any other risk than the normal risk with running projects that is always there when you're in the construction market and installation market. So I don't see any, I know if you have any comments, Kristina, but we don't see any bigger risk than the normal, so to say, when it comes to the POC.

Yeah, I agree on that. Absolutely.

Okay, that is very clear. And looking at installation sales in the quarter, if I look at it, it contracted by 17% year over year. I know it's not your strategy to take on lower margin projects in order to keep key employees, but falling 17%, of course compensated by services, but it's an acceleration versus 7% in Q3. So do you need to take more actions, you think, entering H1 to reflect the current installation demand or do you think that you could reallocate key employees to sort of end your lower utilization? And also on that note, could you also just remind us a little bit if you saw any impacts from the cost savings you announced during Q4 or already in Q4, and also what portion that will be materialized in Q1?

Yeah, a lot of questions in one call.

Yeah, sure,

sorry. Okay, if we start with the demand going forward and key employee question, we will constantly look over the staff in our local subsidiaries. We have a close relationship with our local subsidiaries and on a local level, we will always evaluate, so to say, the step going forward. Obviously, as I said before, staff is our key resource. We want to be very cautious on staff. Just three years ago, there was a shortage of staff. That was the biggest question in the installation market. Now the table has turned, but we still think that we will get back to sort of say the same level as maybe three years ago when there was a shortage. So you need to take this decision on a local level to be able to protect your key employees in the local subsidiaries. And that's a constant evaluation that we do with our subsidiaries. We'll have some subsidiaries growing. We will have some subsidiaries that will have to take additional measures also in 2025. It's hard to say on an overall level how this will look since business is local. If I get correct, the second part of the question was around our cost savings that was announced in December. So basically we closed down or merged eight of our subsidiaries, loss-making subsidiaries. So the effect will be gradually during the year. So let's say if you are a loss-making company, let's say, for example, six million means that you basically lose five hundred thousand every month. So it will be gradually affected during the year. The last company that we will be able to merge will be all the way back in November. That has to do with that ending of projects. So fuel has already occurred. A few will we will have to sort of say live with all the way up until November, but we'll gradually close that down. We also have to finalize the projects that we have agreed upon with our end customer. I think it's also important to sort of say do it the right way.

That is very clear. And the final one, if I may, is on the cash flows. Quite nice to see them come through. I mean, given the considering the circumstances. Q1 and Q2 is typically less good, right? While organic BTA is seemingly organically contracting. How do you look at the leveraging profile during 2025?

I think that, like you said, Q1 and Q2 are especially Q1 is typically not our strong quarter when it comes to cash flow. And Q2 the same since we have the dividend, we have some earn out payments due to that. Some subsidiaries or sellers, so to say, in that sense, have an earn out that reflects the full year of 24. And those will be paid out roughly in the end Q1 beginning Q2, most likely. We also have the possibility to buy some of our minorities back in typically in Q2. So cash flow wise in that sense, when it comes to leverage, I don't think you should expect us to deliver much in Q1 or Q2. I think we'll stay at roughly the same level.

OK, that's very clear. Thank you so much.

The next question comes from Marcus De Villius from DNB. Please go ahead.

Hello, Robin and Christina. Max here. If we could go to South Sweden, it's been a very tough and challenging market there. Both you described it as very tough and Brorita the same. Can you maybe talk about what improvements we need to see there? What is happening? How do you how do you improve your business there? Let's start with that question.

I think South of Sweden is a bit so to say in a perfect storm, so to say. There are a lot of the last couple of years. There have been a lot of new companies coming into the south of Sweden and what I like to call new kids on the block. And there is also no real big projects in the south of Sweden, as we've seen in previous years. So there is there is over there is overcapacity basically in south of Sweden. So what needs to happen is either there needs to come a lot of projects in the south of Sweden or so to say the the supply needs to go down. And we're seeing that as some of our competitors are lowering the supply of installers in south of Sweden. So that is what I think needs to happen.

OK, and then we spoke about the free cash flow. If you go to the working capital profile, we saw some some working capital relief in the quarter. Is this something we should expect going forward? Can you maybe talk about your net working capital profile going forward in the coming year? We

have started a program to reduce working capital. We have a tendency of being very good when it comes to invoicing at the end of the year. It is a bit of an industry standard, but we tried to mitigate this and get that into the full year as well and constantly be as good as we are in Q4. That's the plan. Whether we manage it, we'll see in twenty five. But we are launching an initiative for our subsidiaries to focus more on working capital. So we hope that we will have some good effects during the years to come.

OK, those were my questions. Thank you. Thank you very much.

The next question comes from Johan Lundqvist Sunden from Carnegie. Please go ahead.

Good morning. Thank you for taking my questions. If we start on the order backlog, you've been clear throughout the presentation that you speak to your strategy to be careful not locking in products at too low price points. But it is possible to give a little bit more color on pricing in the order backlog, margin levels that should be expected to be realized during the coming nine months versus the previous nine months.

I mean, we haven't seen like I've said many times before, it's very hard to comment on the profitability of an order backlog because my knowledge of the of the industry and from the last 10 years, what I've seen is that it's more important on how you perform at the construction site compared to what you calculated on. So I think it's it's a bit too early to comment on when you take projects, whether how they're going to finalize. That's why we're cautious on revealing, so to say, the percentage of the order backlogs profitability. But we see no tendency of that. We have lowered prices in that sense. The reason for the increase in order backlog, I would say that there are some as Christina mentioned earlier in the call, there are some more discussions with with customers. There are some more possibilities. These are mainly small projects. We see a tendency in the market that the real largest projects are not there in the same sense. But our key focus has always been on mid-sized projects, so that suits us very well.

Very clear. Then back to the kind of write down situation. And you made a little bit of a clean up here in Q4. No indication that you're when you go through the books that use our projects appears. Do you think you have your kind of arms around the situation as of now?

Like I mentioned before, we go through the order, the dog and also the Pock. So percentage of completion on our ongoing projects on a monthly basis. There's always some risks, but there's also some upsides. So there's always a discussion every month in this. Like I said, in Q3, what we're seeing is that compared to maybe two, three years ago, there are not as much change orders in projects as before. So that can explain some of the lower margin for the whole industry at the moment. However, like I said, we go through this on a monthly basis. There's always a risk when running projects. However, there's also upside when you run projects.

But you feel at least happy with your being final, finished with the kind of review of all the kind of subsidiaries that you have worked with throughout the year. No subjects left that you.

We have 160 subsidiaries. I'm not going to say and guarantee that there is no. We have 6000 projects in our order backlog to guarantee that there is no risk in those 6000. It's impossible. However, we did a good walkthrough of our subsidiaries. We looked at eight of our loss making subsidiaries, decided to close them down. And during that process, we found 65 millions in costs related due to this closed down. Also, some are projects right down. So although 65. So we did a good analysis back in Q4. But like I said, running 6000 projects, it's hard to guarantee that there are no more risks in those. But we did a good good analysis back in Q4.

Yeah, completely understand. Thanks for clarification. And on the kind of restructuring initiatives that you announced, is it possible to give some color on how that has been received within the organization? You have the kind of legacy of working with a lot of these sensors responsibility. Now you're coming in from the headquarter and point your fingers towards a couple of companies and if you are closed down, how has the organization reacted on that?

We have a very mature organization, I would say. And I would say it's it's it maybe sounds harsh, but we have received positive positive reactions from the subsidiaries. We have even received that this is what's called mature leadership. And the theme has been go great during the year, our improvement programs. And we have tried with these subsidiaries. So I think the remaining subsidiaries that are not affected out of these eight, they have been quite positive in the sense that they have seen the work we have put in to help these subsidiaries. But unfortunately, eight of these subsidiaries, we were not able to help and not able to get back to where where so to say our threshold is. And yeah, how do you say after a while and after you've done done all the work you can, you also somehow have to to say enough is enough. And I think that that's been a positive reaction in the

group. Perfect. Just a final question from my side. And it's on the building automation and the technical consultancy businesses that you've built up. Just the ballpark guidance of how many FDs you are in the two segments and what kind of margin levels you're running at currently. I guess the building automation business still is diluting margins and maybe the technical consultancy are boosting margins on a group level. Yeah.

So I would say roughly we are around 450 FDs in the technical consultancy side. And I would add around 60 to 70 maybe 70 now on the automation business. But like you said, automation businesses in the startup phase where we are so to say incurring some costs due to not being fully utilized on staff. Whereas on the technical consultancy side, as Christina mentioned, they have improved. That's the business area that has improved the most during 2024. And they are on group level or even above actually in 24. So very happy with that. So as I closing the books for 24. This really showcased that our startup business works. And as I've said many times before, these technical consultants would prove that it's a very good investment. And now we will also show that the automation business will have the same journey. It might not be as many FDs, but it will also be a profitable company in the years to come.

And the recruitment plans in the automation business still to ramp that up or are you more focusing on getting that stuff to break even or? Yeah, the automation.

We have handpicked these 70 FDs and will continue to handpick good employees in the coming quarters and years to come. However, the business is somewhat smaller than the technical consultancy business. So you cannot expect to say that as quick to ramp up as you saw in the technical consultancy business. However, we're still looking for good employees. And if good employees come our way, we will absolutely try to recruit them as well.

And no guidance on profitability levels ahead on the building automation side? No, not yet. I guess I can line. Thanks a lot.

The next question comes from Carl Bachwist from ABG Sundelkallier. Please go ahead.

Thank you. Good morning. It was actually a follow up to Johan's question here on on intake where you mentioned the margin improvement year of year. And did I interpret correctly that for the full year of 24, we could also do the assumption that the index profitability was above Sweden?

That's correct.

Yes. Okay. All right. Thanks. And then just a question here on the rest of Nordics. I mean, even when we take into account the the the cost that you took this particular quarter, we still have a positive margin trend. You said it before many times that, you know, it's it's not like the market has magically improved. But but you know how how much more can you do internally before the market needs to take over, so to say?

There are a few how to say a few basis points to be be earned internally still. We we closed down some subsidiaries that were loss making in rest of Nordics out of these eight to were to were in rest of Nordics. So there are still sort of say actions that that can be taken. We still have companies that are not that what we need to talk about sufficient levels. So there's still improvements to be done locally. Of course, it would be a bit helpful if we could get a somewhat better market, obviously. But there are still improvements that could be made both in Sweden and in rest of Nordics.

Understood. That was just my final one was was really just on that. We talked a little bit about seasonality and you talked about gearing. But in terms of working capital release, we tend to at least historically see another positive release in Q1. Was this curious to see, you know, if that was taken into consideration during the seasonality comments? My line was a bit poor.

I think that. Regarding regarding the seasonality is somewhat harder to see the same effect. I must be honest and say that we have maybe not done the same analysis fully as you have done. However, what we see is typically when it comes to working capital is that in Q4, we're able to invoice quite sufficient. So they are somewhat more more invoicing. Most likely that will turn in hopefully and most likely will turn into cash in Q1. So I think that that is maybe what we can comment on. I don't know if you have anything else Christina to add.

I can maybe add that in Q4, of course, in the seasonality, a lot of the projects ends and becomes summed up. And then you can send your final invoice. And that gives a very positive effect in Q4 and will come into cash in Q1. And then on the other side, Q1 is when you should start up again with the projects and you have some vacation effect. So we have seasonality as you understand and as Robin already has mentioned. But of course, it's also hard work on working with the working capital. So all the activities around and be tough in a tough market.

OK, understood. Thank you.

The next question comes from Carl Noren from CB. Please go ahead.

Yes, good morning. Just one question from my side on the restructuring cost here. I'm just wondering how much approximately is related to the project write downs and how much is purely restructuring cost for one of.

We haven't actually disclosed the exact split. So it's a combination here of some write downs, like we mentioned earlier in the call that we've gone through the projects for both obviously those eight subsidiaries. That are closing down where we also see that we have had to take some write downs on their existing order backlog. That has also to do with that. How do you say if you announce a closed down of a company, you can imagine the efficiency in that company might not go up, so to say. So that's also cautious where we say that we've taken down that order book for those eight subsidies. So that's cautious. Like I said, we will on these eight subsidiaries try to continue and finalize the work that we have in the order backlog for those eight. That's why one of the subsidiaries, as I mentioned earlier, will not be closed until somewhere maybe November this year. So it's a combination. It's hard to give an exact number or anything. It's a combination of cost that occurs and some write downs in these eight and also in some of the other subsidiaries where we have gone through, like I said, monthly on the POC accounting and in the order backlog as well.

Okay, understood. The less efficiency that you mentioned maybe in some of these companies, what happens naturally when you announce a wind down of a business, I guess. Do you think that will impact the coming quarters or do you think that most of that was sold through the write downs during Q4?

That's taken into the counter.

Okay, that's good. Thank you.

As a reminder, if you wish to ask a question, please dial pound key five on your telephone keypad. There are no more questions at this time, so I hand the conference back to the speakers for any written questions and closing comments.

Okay, since there were no written questions coming in this quarter, I would once again like to thank everyone for listening in and thanks for the questions. And like I said before, we closed the book on a somewhat tougher year, but we are somewhat more optimistic going into the future and will continue the hard work in our subsidiaries to get back to where Instalco belongs. So thank you everyone for listening in and wish you a great day. Bye bye.