Studsvik AB (publ)

Thank you very much, and welcome to Studsvik's Interim Report for Q3 2024. As you know, I'm the new CEO since a couple of days back. So to me, it's really good. I'm actively supported by my CFO, Peter, and he will start the presentation of the Q3. Please, Peter.

Thank you, Carl. And I will take it through the group finance on the top level. And as you Mostly, I think you have read in the report, we have a challenging quarter behind us. One reason about that is because of the fraud that we had in Scampower in the US during August this summer. One positive thing about that is that we have a less impact on that on the financial compared to what we said in the press release during August. And on that fraud, there are still ongoing investigations in that one. But the impact in the financial in the quarter is around 10.1 million SEK. If we look in our group net sales, we see that we are improving our sales. They are higher compared to last year and also the same quarter last year. But we have We're not achieving our goals compared to last year. And that's mainly in our business in Sweden, in FMT, that they're not reaching them. Because as we have written, there is some problems in the production there. But we will come back to that later. But also we need to mention that our Scampower business and the decommission and radiation protection services are having higher net sales and also higher results compared to the quarter last year and also compared to the full year last year. Yeah. And due to this, as you understand and see in the numbers, we have a challenging also on our cash flow. And that's also because of perhaps three big things. and that's one is our investment levels that are bigger and one thing is the demonstration facility in the Indram that Carl will talk a little bit more later on but also we made some media investments here at Stutviks site in Nyköping and that's affecting especially in the Q3 cash flow We also did the acquisition of Extreme Ball and Soak Technique the 1st of July. And there we already see positive effects on the financials in this quarter. And we think that's going to be much more positive in the next coming month and next year. But also one thing that affects our cash flow negative is, of course, our lower operating profits. And that's 19.6 million less compared to the same period last year. Due to this, of course, we are focusing a lot on the cash management within the group. And just a big focus on that one right now. If you then go further down and talk about our business areas, We will start with the decommission and radiation protection services. And as I mentioned before, this is a stable quarter for them. And also compared to last year, they have higher sales, both in the quarter and compared to last year. And we see the operating profits also higher this quarter compared to last quarter. And one thing about this is due to the acquisition of the Extreme Bore and Soak technique. And then we see that we have a lot of positive things ongoing and positive discussions. So it will support the rest of the Stutzi group in a good way. And Gladly also is for the 25 and 26. In Switzerland, we have signed a new framework agreement that will secure a stable level of business in the market for the next coming two years. Anna, if we go further to fuse materials and technology. We have also here positive when we see on the highest sales compares to last year and also the same quarter last year. But we have as we wrote in the report also negative earnings during the quarter and also that's because of the technical production disruptions we have. And that's one thing that we are focusing a lot right now, and that's streamlining the work in the production facilities. And also a lot of focus to work with the order backlog so we can produce and make more revenues. Carl, I will leave it to you to talk about Scampower.

Thank you very much. You can take the next slide, please. As you know, ScanPower is a combination of engineering, but primarily a software business. The software is written or designed by highly skilled scientists in our area of business, i.e. the nuclear area, but obviously also with software skills. We have a very strong development in this business for the year and also the quarter. We have also signed new customers in this quarter so it's a strong underlying positive trend both on top line and not to say at least on earnings obviously the fraud that we announced in august did hamper the profitability but if you put that back you can all see that this is a very very strong business in the quarter with a bit of unfortunate situation with the fraud So this is also... We can go to the next slide, please. So focus now is always just to continue to drive orders, and we have a good order sign. Also, the US market is interesting here. It remains very strong. You may have seen the announcements of new investments from global players into the nuclear business in the US. And that is obviously both resulting in maintaining and modernizing existing plants. also taking some of the ones that have been in standby to bring back service and a plan to build new ones. This whole momentum brings a very dynamic situation in the US market. For me coming in new, I see both opportunities to continue to develop this market, but also that the US can be an interesting market based on the very skilled and knowledgeable and team with a lot of customer contacts to see what more we can do with, for example, M&A and also bringing more of our other products to the U.S. market. So very pleased with the development of ScanPower and the U.S. market. Next slide, please. Waste management technology. This is done based in an engineering service where we support our customers with how to handle waste but we have also here introduced a new IP and new technology to reduce the waste called Indrum. It's a disappointing quarter based on that the initial one of the ways to sell in them sell licenses on the technology that's been a bit slower and also the engineering service has been a bit slower. Initially now after a couple of days I see positive opportunities if you skip to next slide please. Indrum is Pretty easy to understand. It reduces volume of waste and makes it disposable. We have invested, as Peter alluded to, a demonstration line here, if you like, of this, where we can demonstrate how this affects mainly the volume of waste that customers can run in this demo equipment. We have already customers lined up for Q4 and more to come in Q1. And hopefully this will also then drive their interest to actually invest in licenses and build outs of this technology when they can actually see how good it is working live here. So this is also similar to EBS, a product, an IP that we can more easily scale worldwide than some of our other services. So. Finally, obviously, the quarter is a disappointment, not necessarily on top line, but on profitability, which is, in my view, easier to fix. And I see a lot of opportunities. I'm very happy to join. It's a great team. There is a lot of opportunities for growth in the existing product and services for the market. We have a fantastic market position with a very high confidence, and we are a very highly recognized brand. also to be independent, not part of any state-owned organizations. But there's a lot of work to be done here, of course, to make this business even better with high growth and high profitability. And that's one of the things we're focusing on. So obviously the FMT business that is predominantly managed and delivered out of stuttgart in sweden needs to increase the profitability dramatically and that's what we focus on now going into next year in general as an incoming do i will see opportunities for streamline and improving efficiency in the company and we will also look into that to make sure that we have the right setup for driving this company uh There are definitely investments in organic growth that we need to do, and we try to find what are the best areas to really invest more in to get more growth from those faster into 2025 and beyond. As was described in the press release for my announcement, there is also a possibility for M&A, and one of the works we're starting now is to create a strategy, where to look, and a process for building that M&A pipeline. including strategic partnership, because this is obviously a market that is dominated by some big players, and there could be ways for us to operate together with them for certain opportunities. And then I hope that we, over time, will be better and better to actually explain exactly what our business is all about and what different trends in the market are driving the different businesses. The general positiveness around nuclear is positive. But I want to be very clear on exactly what is driving port. Then we will come back to that when we have our Q4 report, how we can describe our business so it's easier to understand what is driving port. So with that, I think we can open up for questions on the Q3 report, please.