KebNi AB (publ)

Hi, and welcome to this report interview with Kebny. Kebny released his figures for the third quarter this morning. And with us to tell a little more about Q3, future prospects, we have CEO Torbjörn Saxmo. Welcome, Torbjörn. Thank you. Upplägget är som det har varit de tidigare gångerna. Torbjörn inleder med en presentation av Kvartalet och Kevni. Och sen avslutar vi med en frågestund som jag kommer att hålla i. Och med det så lämnar jag över scenen till dig, Torbjörn.

Tack. First, a little short about Kebni. We are a small high-tech company that develops and manufactures stabilization and navigation satellite communication. We have two product areas, Satcom and Inertial Sensing. Typical customers are in defense companies, authorities, where there are high requirements for performance and robustness. Examples of such customers are Saab and Epiroc. If we then go into the quarter. We close the third quarter with a turnover of 30.4 million. It is 8% up compared to the corresponding period last year. EBITDA 3.5 million corresponds to 11% and net profit 0.9 million corresponds to 3%. Vi har ett negativt operativt kassaflöde på minus 10,5 miljoner. Där ser man att vi har ökade kundfodringar, vi har ett ökat lager och vi jobbar med att utveckla våra produkter. If you look at what we are doing right now, one of the more important things happening on the market is the interest in drones. To facilitate integration into different drone applications, we are developing a border area called ArduPilot. It is an open architecture that we use to enable integration of Sensation in a simple way. This will be ready and delivered to customers in October for the first time. Further, I can state that during the quarter we have delivered to Aimpoint the first parts of that collaboration. Very exciting. Our project in Korea with Ace Antenna is moving forward in a good way. We see that the customer, the end user, is testing the system with good results. Looking at our satellite side, we are preparing our product portfolio. We have, in our own opinion, the best stabilized platform in the world. And now we are taking the next step by providing the stabilized platform with a dual-band solution. This means that we will be able to send and receive two frequency bands in parallel. Previously, we have only worked with one frequency band, so that is a big difference. Finally, I would like to note that our subsidiary, Satmission, has been mentioned in the news, and I would like to comment on that. Of course, it is of utmost importance for both the management and the board that we follow the laws and rules, and that is the case. Since 2021, we have not exported to Russia. In the same year, we also introduced a clause in all our agreements that prohibits further export to third countries. Vi har samarbetat och varit transparenta med aktuella myndigheter och den tillsyn som har genomförts är avslutad. Tack.

Tack för det Torbjörn. And I think we'll start by talking a little bit about the turnover and, above all, how the product mix was. Because the turnover itself is what we expect in a quarter when no special order has come in. So there's not much to talk about, but it's mainly the product mix here. How does it look? What is it out of Enlo and IMU that you sell?

It is a sensation for a number of customers. We have mentioned Aimpoint, for example, and there are a number of other customers who have accepted the delivery. We have also delivered a slightly smaller project within the satellite communication side, but That's the small part. So the lay-on part of the turnover is done by inertial sensing, IMU.

Yes. When you look at smaller projects within SATCOM, Is that the ESA project you're talking about, or is it something else?

We haven't delivered the ESA project yet. We're working on it. However, we have delivered some spare parts and maintenance support to an old customer.

Okay. And the costs continue to be stable, just as we expect? Yes. So that's why the margin is also good. However, it is not reflected in the cash flow. And that actually depends on two things. We saw that customer feedback came up a little bit, and that you are building goods. If we start with the customers, how should we think about them? Is there any risk in them, would you say?

No. The customers are large companies, so I don't see any risk in that. And the quarter is always funny because it's a semester month and then nothing happens. And we have a flow that means that the first day of work, we can't invoice, but it takes a bit of time before we get started with the invoice. We have such a process. And that means that just in connection with the months when we close the business, it takes a while before we get started. And that also makes it a bit of a catch-up on the invoicing, that it comes quite late and then it builds the customer base, quite obviously.

Yes, yes, that was clear. And when we look at the goods storage here, is it mainly Sensation products that you build up storage on and components for different types of antennas?

Actually, it is both. But most of the time, a large part of the warehouse is on the Satcom side. We are preparing ourselves and making ourselves ready to be able to deliver in a very short time. And that builds the warehouse for us.

Because that's the big question that everyone wonders. When do we see these orders coming in? And then during the presentations here, you mention that you are developing an antenna with two bands, dual bands. Is that a must to get an order? Or can you sell existing products like it is now as well, would you say?

Yes, both and. I mean, it's not a must to get an order, but... To meet the demand that exists on the market and to be ready, we have seen that it is not really sustainable to develop something on a customer order. Then it takes too long between orders and delivery and the customer is not willing to wait that time. Then we have drawn the conclusion that we need to do this upfront to ensure that we can take orders with relatively short delivery times. But that is absolutely not a prerequisite, because our existing KU antenna works really well to sell. So that is not... No, then the eventual order is not dependent on the fact that you have this dual... No, but it makes it possible, or it makes it possible that we get a larger market segment to attack.

How long does it take for such a development, would you say?

And how long have you been doing this? How close is the end phase? We started a little carefully at the beginning of the year, and that will take another year or so.

And then you also mention drones here, and that it's a very interesting and exciting trend. You also mention this, ArduPilot. How important is the ArduPilot function to deliver IMU's to drones? Same thing here, is it also a potential drone order? Is it dependent on this ArduPilot function?

Both yes and no. Different drone manufacturers have different boundaries. And we have received a specific question if we can have ArduPilot as a boundary. And then we come up with such a solution. But there are other customers who have other ways to integrate it. The difference is that with Ardupilot, you get more of a plug and play. This means that you are not as heavily integrated into the customer's system as you would otherwise be. You are easier to exchange, which is both an advantage and a disadvantage.

And then you also mention that the collaboration with Ace Antenna is fast and is going well. You also say that this is being tested by customers. And if I'm not mistaken, you were counting on the delivery to start in 2027. If I hear a final test, can this mean that you are a little earlier on this sales? Or how should you think?

Now you heard the word end and extrapolated. I said end user, not final test. So that it is tested by the users. That is the last step. And that goes really well. From what we can understand, we are on the plan and follow the plan that the customer has.

Then it is 2027 that still applies. Yes. And then finally, since we all wonder and ask ourselves here, it is mainly the growth that builds on the order entry. What are the expectations here in Q4 and then mainly in 26, would you say?

Yes, but we want to be SEDDA as a growth company. That is our statement. We have not changed the ambition as far as 2025 is concerned. It is still at the same level. And that will be a gap to 2026. More than that, I'm not saying. But we haven't bowed down. We still have a high ambition to deliver 2025. Exciting.

Then it can be some intense months that come here. So it can be. Thank you so much, Tobias. Thank you. Thank you so much to all of you who have watched.