Munters Group AB (publ)

Welcome to the presentation of our Q4 and full year results for 2020. I am Ann-Sofie Jansson and I'm Head of Investor Relations. I want to say welcome to those of you who are viewing on the web. those of you who are listening in on the telephone conference. And I would like you, the ones that are listening in on the webcast, to know that you can post your questions throughout the whole presentation, and we will take them afterwards. And with me today, I have Annette Kumlin and Claes Forsström, our CEO. And now I hand over to Claes.

Thank you, Anne-Sophie. And once again, very, very much welcome to this quarter four and full year presentation. Before I start, I would like to say like this, that Q4 concludes a year that in many ways have been unprecedented in society, for business and for Manters in regards to COVID-19. In summary, Manters has delivered Solid business performance, operational improvements, while supporting our customers, resulting in improved profit and a strong cash flow generation. All in all, creating a stronger base for our future growth journey. With that, let's move into agenda. The agenda is highlights for the full year. Myself will present that, as well as implementation of our strategy and the progress that we are making there. I will hand over to Annette to talk about the fourth quarter and the full year 2020 result, summarize and then open up for Q&As. a stronger base for the future growth year. If I talk about the year, order intake increased, FX adjusted by 2%, and net sales increased with some plus 1%. We had an EBITDA adjusted improvement of close to 5%, reaching 906 million Swedish krona, and that despite of an increasingly stronger headwind from currency during the year. Both Airtek and Foodtech showed good progress and we ended up at close to 13% adjusted EBITDA margin. What was very pleasing was that the leverage went down from 2.9 down to 1.9 during the year. Also, I'm happy to say that the board proposed a dividend of 0.7 Swedish krona per share for 2020. The year has been challenging in the market conditions. The pandemic had mixed impact for us. The most and largest impact has been during the second and the fourth quarter. There has been delays in deliveries to customers and postponed investment by customers. All production units have been operational during the year except one minor unit. With this I would like to say as well that our focus when it comes to production units that is to keep it safety first, i.e. have a safe workplace for our employees. So on and off we have closed some production units and then open up after clean up and so on. And there is still a low visibility in the market demand due to lingering COVID-19. And what I can see during the quarter that it's more and more constraints, both in customer supply chain and also in our supply chain. But now we're entering the next phase of our journey. We have an organization set up with clear responsibility and accountability in place. I feel that we have achieved growth in the prioritized areas with great focus. They're moving ahead with the product rationalization and investments in R&D. And we have created a better way of working. Now, it's a strong focus on turning Mantris into a more customer-centric company with zero impact on the planet and growth drivers to be captured. A little bit more granularly into the quarter four. If I summarize it, it's the decline in Americas and growth in EMEA. Data centers in the US had a weak order intake on the back of a strong 2019. That was partly offset by good development in pharma, lithium batteries, and supermarket subsegments. I'm very confident that data centers is on the right track. It is. That is the area where we have the largest project type of business, and one quarter will be lower than other quarters. But I see strong progression and have strong trust in all things we do in data centers U.S. What was very pleasing was that service had a positive development in U.S., You will hear me speak later on about long-term targets, but I am pleased both with the parts of service, the size of service, and also the result that it has delivered to the bottom line, in particular in the US. Foodhack had a weak development, mainly driven by an overcapacity in the swine market in the US. Nothing has changed there. EMEA, Airtek, weak development by missed elimination that was partly offset by the lithium subsegment. Foodtech, some weak development from the effects of the COVID. It was customers that didn't open up for us into the farms, etc. In Asia, we had growth in APEC driven by strong performance in pollution control connected to missed elimination. And food continued to deliver stable development in the swine segment in China. And if I summarize it, growth in EMEA and APEC and decline in Americas. More detail will come later on when Annette talks about the quarter and the full year. The implementation of our strategy. You have heard me speak about this and we are here for the long run. Everywhere in many, many customer critical operations, Mantris is part of the success. It is about innovation. It is about both driving the right markets and services to the market, but also to take out non-well performing products and lower the assortment. In the markets, we focus on markets where we can gain market share and we can generate profit. And customers, it's all about value selling. And then the continuous improvements and when needed, cut off non-value contributing parts. People is at the center and setting them in the right organization. And all of all, it delivers on the purpose, customer success and a healthier planet. I will not go through all of those details, but let me highlight on this slide that I see good progress in each and every one of those areas. For the long-term ambition, I'm confident that we will deliver on those, especially when it comes to innovation. I see good progress in the portfolio reduction. We are now above 30%. The ambition is now set to reduce the components with 25% end 2023. And here we talk about fasteners, metals, electronic components, etc. And if I summarize this, this is a three-part type of story. It is about driving innovation and products. That is done by cleaning up the non-important product portfolio, taking out and simplify the components. And then when you develop products, have them modulized and make them then easy to use for the customer. When it comes to markets, excellence in everything we do in people, let me drill in a little bit on the coming slides. You have heard me talk about the need for customers to trace their food, i.e. from the small chicken all the way to the McDonald's or the Kentucky Fried Chicken. I'm so happy that we have joined with JBS Pilgrims, the largest animal protein producer in the world, to implement an artificial intelligence supply chain system. The platform will provide centralized end-to-end planning, and you can follow what a chicken eats, how the chicken moves, and you can predict the weight of the chicken and thereby generate a lot of customer value to the end user. I think here we have the opportunity to jointly with industry change that industry moving forward. It is setting the base for traceability in the food chain. You've heard me talk about expanding our service offer, and that has happened during the pandemic. Our long-term ambition is to reach 30% of our net sales. I see strong progression here. We reached 14% of net sales for the full year, and we landed on 17% of net sales during the fourth quarter, and that despite the challenges with the pandemic. And as I said earlier, I see strong progression in North America and US, both when it comes to how much of the sales is driven from service, but also development in the profitability. And also here, it is a three pronged approach. It is about having a better mix with more service, securing a more stable long term company, but it's also about generating improved profitability from the service that we have. focus on excellence and efficiency it is about creating a playbook it is about creating systems introducing leading ways of working and that has happened during the year it is about commit and deliver on decisions that we have taken so all the measurements that we announced when it comes to sharpening the customer offering and the footprint optimizations are delivering according to plan and implementation will be completed during 2021. But very pleasing is also that it generates good results. The move in operating working capital going down from 14% a year ago to 10% now sends the signal to me and to our organization that we are delivering on what we have committed to do. I'm very happy here. And the new organizational structure is completed now. It is a clear ownership in the business areas when it comes to the business. It is about supporting them with different areas of strategic importance, like strategic operation, like innovation, and like commercial excellence. I think we have a team set to deliver for the coming years. Sustainability. Sustainability is fully integrated in Manters' strategy. It is about resource efficiency. It is about responsible business practice, and it's about people and society. Resource efficiency, how we use our own resources and how we help customers to deliver on their targets. During the year, we have set higher ambitions that we will start to deliver on during 2021. We are focused on understanding and analyzing from where are we going and what do we have to do, especially when it comes to carbon dioxide emissions and safety, diversity and general environmental work. And what is pleasing that is a company is based on their people. And the belief in what management says. And here I think we have made good progress. I'm so happy to see that our people tells us that they see what we see. With that, I hand over to Annette to deep drill into the fourth quarter and the full year.

Super. Thank you very much, Claes. So let's look into our performance versus last year and our midterm targets. As Claes said, we have had a very good performance in spite of COVID-19 impacting us. There's been a lot of hard work obviously behind it, but all in all good. So we have grown, particularly if you look at Q4, it was very strong and also which led to then that we had a full growth during the whole year of 2020. When you look at the margin, we're at above 13% in the quarter and almost 13% for the full year. Now we do have a negative FX impact, which actually would have led to almost a 1% higher adjusted EBITDA margin in the quarter and above 13% for the full year. We have worked very hard also to make sure that we make Mantos financially strong. So leverage has now come down below two times. If we look at the growth in the business, it has been rather good. And it comes basically from China and food tech, where we have had a growth during the quarter in the order intake, which was quite substantial. And also, if you look at air tech, it has shown good performance. If we look at the FX adjusted order intake for Q4, it was just below last year. And one of the impacts was obviously that we had data center in the U.S., which had a very strong quarter in 2019. So that impacted in the wake of this. And then also we have actually taken out, as you know, the commercial non-Walmart business in the U.S., which also had a slight impact. If we look at the full year, it was actually above last year. It was mainly driven by air tech industry for US and also China, then for food tech again. And when you look at the impact that we have had from COVID-19, actually the biggest impact has been during Q2 and Q4. So all in all, when you look at the demand side of it, and also if you're looking at the backlog, it's been quite strong for us during the year, in spite of COVID-19. Sales in the wake of the order intake has been good, obviously, particularly when you look at the food tech side, continued growth in China. And we have also seen some growth when it comes to EMEA and the broiler segment. When we're looking at air tech, we're again coming back to where service is having a good performance, for instance, and also lithium batteries, just to mention a few. If we look at the net sales for the full year, as we said, slightly above last year, again, services is actually having a good development. And we can see now that services in the quarter was 17%, which led that it grew one percentage, basically, compared to what we have seen before. If we particularly dive into air tech, one can say that one of the areas that have grown a bit also is pharma, and that is kind of like in the circumstances when looking at what's going on with COVID-19 and the testing, where we have seen a demand coming in from our side. Obviously, when you look at air tech, we have missed elimination, which has been coming down quite a bit during 2020 because of the market situation, although we had a nice order intake coming in in the Q4. When we look at the full year, basically same level as last year. Again, we have lithium batteries and services and also industrial, which had a good performance. And then again, also remember that we're taking out non-core commercial segment in the U.S., which actually has an impact of a couple of percentages, as said before. If we look at sales then, above for the quarter, good growth in, for instance, pharma then. Also services in the supermarket segment in the US was very good. And again, weak mis-elimination and also data center declined a bit. Again, in the wake of having a good performance in 2019. And if you look at services then for the full year, actually, if you look at it in the air tech setting, it's about 20% of net sales. If we look at food tech, again, the performance is, as you have seen earlier, good growth when it comes to China. And you have seen also that the broiler in the EMEA is coming up, whereas when you look at America, it's been sluggish, so to say, and also that in the wake of the COVID-19 pandemic. Order backlog also for FTSE quite good going into 2021. And hopefully we see that coming true later in the year. And then when we look at the net sales side, again, very strong in quarter two, again, China driving it. Although what we can see now is that the growth rate in China is coming down compared to what we saw in Q4 2019. And full year again, very strong performance with plus 8% in spite of the COVID-19. But also remember that this is in the wake of also having the African swine fever coming in in 2018 and particularly impact in 2019. If we look at EBITDA then, again, I mean, we have worked quite hard, as Claes have been saying, to make sure that we set the foundation for future growth and also working with improvements in our value chain. So part of that is coming through now when you look at 2020. And then obviously also when you look at, for instance, FUTEC for the full year, you also see obviously that the volumes are coming through. Again, we had a big FX impact during Q4 2020. Basically, the whole FX impact we had for the full year actually happened in the fourth quarter. And it took down our performance for the year with 0.3% basically for the full year. So it's about 20 million that was cut off from us. What we have been doing is obviously that in the wake of setting up the strategy during the early spring, we're also obviously starting to deliver on it. And we took also in Q2, if you remember, a decision to sharpen our organization and also to take out some non-value-added businesses like the non-Walmart commercial business in the U.S., That whole program was estimated to cost about 188 million Swedish crowns with about 136, which was IRC. And when we look at the performance during the year, we have been able to implement certain measures. And also in parts of it, we can see that the cost was a bit lower than what we expected from the beginning. So we're down to the 124 instead of 136. At the end of the day, as earlier said, also we're looking into a savings of around 70 billion being fully implemented then by end of, at an annual run rate end of 2021. So we're all in all delivering so far according to the plan. Again, very strong cash flow development. It has continued and it's about getting into the DNA on how we work with operating working capital, which is setting through. So Q4 was extremely good and we have come down. So operating working capital is about 10% of our net sales compared to about 14% in 2019. Yes, in the wake of actually having a negative FX impact on profits, we had a slight headwind actually on the development of the debt valuation. But again, the biggest impact when you look at how we have performed on leverage is really coming down to our own work of setting the right DNA in working with financial balance sheets. So cash conversion, very good. As you can see, we were actually quite high, the highest we have seen. And we have particularly certain areas that were delivering good on the American side. The leverage, as we have talked about, has consequently come down to 1.9. And this is really also about setting the foundation for the future growth, which is not only related to obviously organic growth, but also making sure that we can prepare ourselves for also M&As further on. So with that, I would like to hand over to Claes to do the summary and also conclusion.

Thank you, Annette. And let me summarize the year as well as the quarter. Strong performance despite the challenging market. We have focused on executing on our strategy and create a stable base moving forward. I see continuous efficiency improvements and cost control that resulted in increased profitability for the year. And as Annette said, a good improvement of the leverage. Moving forward, digitalization is a key enabler for overall efficiency internally, but also for enhanced sustainability and growth towards our customers. The market visibility continues to be low and we will do our utmost to keep our supply chains open and keep our operations up and running. But it's tougher in the supply chain at current. I truly feel that we are so well positioned in the long-term growing markets driven by climate change, energy efficiency and digitalization. And by continuing investing in in innovation and efficiency improvements, I feel that we can capture this moving forward. With that, over to Q&As.

So I would actually like to encourage everyone on the webcast to now post your questions. And I would like to start with opening up for those of you who are listening in on the phone to see if we have any questions from you.

Thank you. Ladies and gentlemen, if you have a question for the speakers, please press 01 on your telephone keypad and you're entered to you. After you're announced, please ask your question. Our first question comes from the line of Carl Boklund from ABG. Please go ahead.

Yes, thank you and good morning. So the first question has to do with perhaps something that you choose to highlight in the fourth quarter here when it comes to COVID impact. I mean, you overall, it's fair to say that you managed the pandemic quite well during the entire year. So are there any particular things or any particular regions where you've seen that the effects of a pandemic on your operations have materially had a more negative impact than compared to Q3, for example?

It's a good question. Thank you for that. If I generalize, you can say like this, that the wider spread of COVID-19 at current that is in North America, and it has also been tightening up restrictions from government and so on. And then the other part that is in Eastern and Central Europe, where it's also spread. And I would like to underline that, I mean, we have a tight ship that we run. It is more about what is happening in the society in general. And that, of course, affects us. And then what we can see also, it's spreading into delivery time from our suppliers, etc. But all in all, as I said, it is tighter. It was tight in quarter two and it has been tight in quarter four. I hope that explained a little bit more granular where we see the largest challenges.

Understood. And I appreciate your comment on low visibility. So I understand that. But still, if possible, would you say that If things start to improve because of vaccine and so on, do you feel that the impact on your operations would also improve? Or is there any kind of late cyclicality effect of a pandemic as well on you?

I don't think it is a late cyclicality effect. I think that it's we used to say like this in Mantis right now. It is not over until it's over. And I think it's very, very wise to say that the vaccine, it will take some time. It is a matter of running a tight ship and keep it tight as well. I mean, and at the end, deliver on customer demand. expectations and be close to them so generally speaking my conclusion is this is not over i expect a pandemic to affect not only us but also our customers for the coming month and quarters but i mean that is no change since before understood and and this this particular quarters ordering thing if we're very uh short short short sighted here or short short term focused uh it's it's back to

Do you think it's mainly because of timing effects or have there been any notable changes to any particular demand environment that will also be lower going into next year?

If I start and then if Annette has something to compliment, but as you heard, I mean, one, when it comes to order intake, it was linked to comparables when it comes to data center in the U.S. Here I have no worries. I mean, we would have quarters up and quarters down. That is the type of quality that comes with that type of operations. And then another part that has been also offsetting us in order intake, that is, of course, that we have exited also the non-commercial side. the commercial side, except Walmart and in North America. Beside that, I mean, it's nothing then more than normal and I call it sequential changes. But Annette, anything to add?

Yeah, and then also to remember is that when you look at food, it has been driven quite well by China during 2020 in the wake of the African swine fever. So that also has to be taken into account when they're looking into the future.

Okay, thank you. My final one was just you mentioned that you booked lower cost than the initial expectations on restructuring program. It just would be interesting to hear why that is. Is it that you were able to achieve the same kind of efforts that you targeted but just happened to be at a lower cost?

No, I mean, obviously, when you close down a business like we did with the non-Walmart commercial business in the US, the question is how much of your inventory you can sell out if you're stuck with old inventory. And actually, we were prudent enough to make sure then that now in Q4, actually, we came out better than we thought on that activity.

Is it possible to quantify the kind of effect on either orders or sales that exiting the commercial side had in Q4?

If you look at the for the for the full year, I would say when it comes to exiting commercial in the US, it was an impact of a couple of percentages on the order intake. And then obviously, when it comes to net sales, no real impact so far because we were delivering on earlier order intake.

Okay, thank you.

And the next question comes from the line of Lucas for honey from Jeffries, please go ahead.

Hello, thanks for taking my question. So I just wanted to come back on the services segment. What do you think is the biggest driver of growth in services in your strategy? I think there's one part which is gaining service contracts from customers, also penetrating your install base and M&A. I just wanted to know what would be the biggest driver. Obviously, there's a long way to go to get to 30% in the medium term. Thank you.

Thank you for the question, and you're so right. Service is an important part of our strategy and business moving forward. It is three components, if I generalize, and you highlighted one of those. It is, of course, always to attach a new service contract when you set an OM order. And I can see that that is now starting to happening. It is really good to see the progression, especially in North America, but also in Europe and in Asia. Then, of course, it is about revisiting the customers that we have not been able to work so closely with in the past, where we have lost business. And thirdly, it is can we then convert competitor business into our own service? If you combine that, I think that is the operational mode to drive. Then you can complement it with M&A or activities, finding the right service companies. And as I said earlier, I think generally speaking, when it comes to M&A, it takes roughly two years to build up a funnel. And I hope that moving forward now with the strong financial improvement we've done that we can start to progress on that. And then finally, it is more towards software, software as a service. And here I think that I can see strong progress when it comes to especially food tech, the pilgrim business that I talked about. And that generates a more stable business also there.

Great, thank you.

And we have one more question from the line of Mats Lis from Kepler Chevro. Please go ahead.

Yeah, hi. Maybe a follow-up there on the service question. Could you give some color there on the mix between labor and fair parts on the service offering and also maybe give some favor on the mix between proprietary and commercialized, commercial fair parts in your service space.

Yes, in this area, we will become more and more granular moving forward. But instead of talking about the different sizes, I mean, the service part is very much brought up with, I mean, the component supply, and that is the largest part. And then when it comes to service agreements, it is about setting those, and that is the second largest part then. And then the smallest part in our total service, that is the software as a service ingredients at current. And the software as a service, just to give you a more granularity on that, then when it comes to food tech, and here we talk, it's only at current in food tech, it represents roughly then two, two and a half percent of the total turnover of food tech.

okay great um so we will get some more information regarding that going forward yeah yeah and and then you're talking about these supply chain issues or potential could you give some indication about the impact loss in the fourth quarter and maybe what the issues are going forward is it sort of semiconductor conductor I guess the people view as well, or something about that.

For us, it's not semiconductors in particular. That is not a large part of our supply. It is more a general supply question that when it comes to freight, it's starting to tighten up. When it comes to customers, well, I mean, it's not only what we need to have. It's also what customer needs to have to run their sites, etc. So I would like to summarize it as a more general tighter ship in supply. It's well managed. I'm not alarmistic here, but I think it's wise to say that this is not over yet.

Okay, thank you. And finally, just about raw materials in some segments have come up a bit. Could you say something about the potential impact going forward?

The largest raw material content that we have is when it comes to metals. And I mean, there we have seen increases in the system. And we are constantly working with both mitigating that in negotiations and, of course, to push forward it when it comes to price increases. Already the last year, we took price increases as a precaution. And then we need to be on this step by step. But Annette, anything to add on that more in detail?

No, I think it's, as you said, it's coming back to how we work with our pricing strategies that we need to continue focus on going forward to make sure that we capture raw material costs through our customers.

Okay, thank you very much.

And the next question comes from the line of Max Fodin from Denske Bank. Please go ahead.

Thank you so much. Good morning. Just on the margin progression, if you could break it down a little bit, because the gross margin includes some almost two percentage points. And I guess then that the OPEX is going one percentage point if they're just for the positive extraordinary items, etc. And if we were to look forward here, could you just help us understand what of that OPEX increase is something that you will keep or what is it that you can do to take down that delta going forward?

I mean, if you look, I mean, in general, we have said that we are building mantas for the future. So obviously certain things is about relating to mix and obviously taking out then the non-Walmart commercial business in the U.S., which actually improves the margin as it was low performing. But then it's about the whole value chain throughout the company, both from an operational point of view inside of the factories, but also from a general value chain point of view throughout the whole company. So that's what we're here to do. And you know our mid-term targets also when it comes to our EBITDA margin, which we're working towards. Then obviously, as we have said earlier on, it requires certain investments to do that from a resource point of view as well. So you can probably see some movements on that also in the company. But in general, we have our mid-term targets that we're steering towards for the moment.

But is it so that we have been, from our side, a little bit too optimistic and we've seen in relative terms and now you need to sort of invest a little bit more in cost going forward as well.

I mean, again, if you look at digitalization, if you look at building people inside of the company, if you look at building the value chain, obviously, there are certain resources required to do it, which we have also flagged for earlier earlier on. So that comes that comes in play. And again, we have the midterm targets that we're steering towards, and we haven't changed them as of yet.

All right, okay. Thank you.

And the next question comes from the line of Anders Forslund from Plurito Securities. Please go ahead.

Yes, good morning. I would just like to ask two questions regarding the demand in air tech in the specific areas of data centers and lithium batteries. How does the order pipeline look like in those two areas? And for the food tech, how does the growth scenario look like in China and also in the US?

When it comes to the order pipeline, I'm satisfied with the order pipeline that we have in data centers. It's sufficient and strong. Then, of course, as I said, then we highlighted, I mean, one quarter it's up and another quarter is down due to the type of business that is more project driven. We have our pipeline at healthy levels when it comes to data centers. And the second question was in regards to... lithium batteries also in the air yeah thank you i was on on food tech and lithium batteries what i see there uh we we are gaining a lot of uh let's say questions we are getting interest and and i'm also here very very confident that we have a strong uh back backlog when it comes to that so both those areas are strong future growth areas and i'm very confident in that yeah and just to emphasize

DC had very good orders coming in in 2019. So obviously then that could be hard to match when you're in your project business from quarter to quarter.

Back then to China, as I said a couple of quarters ago, we cannot expect that this strong, strong growth year by year is going to continue. It came back from a very low level affected by African swine fever. But with that said, also moving forward, China is more and more focused on self be self-sufficient and supplying their own type of food. food, and also moving into a more modern way of chicken and swine farming, so to speak. But I don't expect that the strong comeback from African swine fever will be that strong this year.

Okay. And the U.S.? ?

In the U.S., it is a different cycle. And really, if you follow the long-term predictions when a business cycle ends, we should be close to the end of that business cycle. But once again, I mean, and then we have to put on the pandemic on top of that. So if we follow the normal patterns, I mean, we're coming closer and closer to the end of a tight business cycle in U.S. Annette, anything to add there?

No, I think that covers it.

Okay, thank you.

And we have just a follow-up question from the line of Lucas Farhani from Jefferies. Please go ahead.

Hi, it was just on the financials, if I could confirm two points. Regarding the tax rate, it seems slightly lower than what we expected. Do you think that 22% can be a normalized level going forward? And also, I just wanted to come back on the other elimination and other cost line, which seems much higher. Can you give us an idea of what's behind that big increase in Q4? Thank you.

First of all, when it comes to the tax rate, that follows obviously where we sell, so it depends on the country mix. And as we're talking about, we're not really giving guidance forward on this. Again, country mix impacts what tax rate we have. And then when you look at the costs in the other area, well, as I said again, I mean, we're building... Mantras for the future and resetting foundation, which is a lot about looking into the value chain throughout the company. For instance, digital side, but it's also looking through everything from how we create a product actually to how we sell it and get our money back from it. That requires resources to actually organize around it and in various areas. And it's important to do this right and take the time to do it. The other part, which is actually related to our long-term incentive program, which is, as you know, based on stock options. And obviously, when the month of share price goes up, then obviously we have to value the impact on that into our P&L. And that's part of what has come in. And that's actually a major part why the cost in Q4 was higher than in others compared to earlier quarters.

Perfect. Thank you for the detail.

And there are no further questions from the phones. Thank you very much. Then I will take one question that we have received from the web. And that is from Philbert Vessier. I'm sorry if I'm not pronouncing the name correctly. And it is regarding acquisitions. And if you can comment a bit regarding your pipeline, Claes.

Thank you for the question. And for those who have not listened in in the past, I mean, first of all, what is our target universe when it comes to acquisitions? It consists of three main parts. One part that is a string of pearls when it comes to service companies, predominantly towards air tech, but also when suited into food tech. Secondly, it is about call it digitalization or smaller add-ons when it comes to products, but especially digitalization like the M-Tech that we have already in food tech. And thirdly, it is about then larger possible targets that can also complement our business and our footprint. And that could be then both the food tech and air tech targets. But if I generalize, that is the three ones. And what we have done since day one, that is to work with those three areas and building up the funnel of it. And then, of course, as always in M&As, first, it's a couple of things. First of all, you need to have the financial headroom to make it possible. Secondly, I mean, when you have a target list, I mean, then you need also to, I call it, start dating and asking and understanding, etc. And when that is done, then normally then it starts to come through. And if I generalize from my experience, it takes roughly two years to build this up. And then it's up to, I mean, how successful we can be and how well can we attach to then possible M&A targets. But Annette, you have put in a lot of energy in this as well. Anything to add?

Yeah, and it's about time at the end of the day, time and financial stability. And I think we've kind of like ticked the box for the second one. So now it's about the time to get a target in.

Thank you very much. So with that, we have no further questions from the web and no further questions from the telephone conference. So I would like to thank you all for listening in. And we will release our first quarter result in April. And we look forward to see you then. So thank you for today.

Thank you.

Thank you.