Ladies and gentlemen, welcome to the Half Year Results 2023-24 of dormakaba Holding AG Analyst Conference Call and Live Webcast. I am Alice, the call's operator. I would like to remind you that all participants will be in listen-only mode, and the conference is being recorded. The presentation will be followed by a Q&A session. You can register for questions at any time by pressing star and one on your telephone. For operator assistance, please press star and zero. The conference must not be recorded for publication or broadcast. I would like to remind you that the conference call does include forward-looking statements, which are subject to risks and uncertainties. Listeners and readers are therefore strongly encouraged to refer to the disclaimer included in the presentation. At this time, it's my pleasure to hand over to Siegfried Schwirzer, Head of Investor Relations. Please go ahead, sir. Thank you, Alice. Good afternoon. I'm Siegfried Schwirzer from dormakaba Investor Relations. I wish you a warm welcome to our Half Year Results. Joining me here are our CEO, Till Reuter, and our CFO, Christina Johansson. Before we proceed, a few words to the agenda items today. Till will start with an overview of the key figures and an update on the transformation program. Then he will talk about innovation and customer success, followed by business segment performance. And then Christina will take over and talk about the financial results in detail. Finally, Till will conclude with the outlook, and after that, we will open up for your questions. With that, I'd like to hand over to you, Till. Thank you, Siggi. First time to present the numbers together with Christina. Very happy to welcome you all. As you know, I've been in the board from October to December 2023 and joined in January as CEO. So it was good to have a little warm-up in the board and then, since January, I had the chance to work closely with the team. What's very important for me is that we continue to what has been started and support the team in achieving our goals. So I think that also what we showed today, that we are with our Shape4Growth program, are on track, and that we will continue together as a team, Christina, myself, and the EC, to continue on the growth program and to really achieve our goals so far. I had a chance to visit a couple of sites around the globe and just some takeaways from my side. It's important that we are a midsize entrepreneurial culture company with a lot of growth potential. That's also the reason why I'm here, because I believe this company has a big potential for the future, given the products, the offering, but still something to go, to go and to do. We have a strong customer base. And when I look at the products, a strong base of hardware and smart components, a global offering. We have engineering for intelligent solutions. And we also are able to lead this to the digital world, which means, like, we can have access managed really across verticals in the digital world. This is, in some way, comparable with one of my last experiences where I could move the robots, the hardware, from hardware into the digital world. I see that we also have here some topics which are comparable. In the end, it's how we can connect, how we can work in the offering, that we can have more products from Dormakaba be part of a solution on the customer side. What is, besides the continuation of the cost program, very important for me to work on the offering. We have a good offering, but it's very essential to complement our offering across market. That means what I want to do is, having been in some of the sites local, we have to be really local for local go-to-market based on a global offering. And I think that is also where our new organization helps us and gives us more opportunity. We have to be strong in the locations, like U.S., in Germany, Switzerland, in the big markets. But it's important that we develop innovation globally with no duplicates. And I think that's something which we really have to adopt further, that we, on the one hand, listen to the global to the local needs, but have it globally adapted and, to avoid redundancies and become much more leaner and more efficient. That's also one of my takeaways, that I think some topics we can do much easier, much more focused, for the future, coming from structural changes but also from the product portfolio. Just one example where it's important that we have a global offering. I had the chance to visit the Lucas Oil Stadium in Indianapolis, where the Colts are playing with Alvarado. We offer contemporary access solutions for big sport events. We are four times partner of choice for Super Bowl in the recent years, which was really a solution which we can offer globally. I think it's on us to not only do it in the U.S. but also in other regions to sell our solutions. I am here to build on this, to drive efficiency further, and to focus on the second part of Shape4Growth. It's Shape4Growth. We are in the middle of the Shape. I think the key goal for me will be to grow the company in the next years organically, but maybe also in the future with acquisitions. Jumping in the numbers, you see that our transformation program shows results. So it's solid organic growth and significant marginal improvements. The positive development in the first half of this year, the organic growth of 3.9% is foremostly driven by pricing, but also we see some volume growth on the group level. The currency translation effects on sales are 6.7%, but it's just translation. And we see that we are regionally very well positioned. I will later tell a little bit about the local growth in local currencies. What is very important to us, besides the growth, is that we have really improved our adjusted EBITDA margin by 160 basis points to 14.6%, coming from 30% in the previous year. That is, for me, really our transformation program, where we are in the middle of it, really shows positive effects as planned for the first half, mainly from operation efficiency and procurement. What else to note is that clearly net profit is affected by restructuring costs, where my colleague, Christina, will give more details on the restructuring costs and the net profit. But we also managed to have a positive more positive cash flow by having a tight net working capital management, which increased our cash generation. If you're looking at what happened on the transformation program, we are progressing as planned. We are pleased that we have improved our performance yet again in line with the guidance given. And we are confident that we continue to deliver on our guidance and our cost program. The transformation program will support this. And the good progress, we see the first effects on our numbers. The main goal for me is to drive this program together with the team, Christina and the EC, to even better accelerate the cost program. The impressions I have so far, and coming from the visits in the regions, I still see a lot of potential. One topic which I already mentioned is the complexity which I see in the operation network but also on the product side. I think it's one of the key goals of the program. Still lots of potential where we can reduce complexity on different levels and how we work together. Other goals are, as mentioned, consolidating of the production footprints, 18 production sites to less sites. So clearly, what we want to do is to move to best cost countries in the region. So in the U.S., we will move more to Mexico and Nogales. In Europe, we will increase our capacities in Sofia, Bulgaria. In Asia, we will play around Singapore, China, and Malaysia to have a cost-efficient network in the regions. This is ongoing in progress. We are here in plan and try to further accelerate the transformation on the operation network. We have procurement savings, which is clearly one topic, reducing the number of suppliers, be more efficient, also here having new suppliers in cost-efficient regions, but overall, also here reducing complexity. One of the topics I will have on my list is the refocus on product development. So on the one hand, we have too many products in some areas. We have to further work on the good, stable basis of hardware, have connected hardware, and then see that in which region we can have further potential to grow and focus on this product development. And then, really very important, get this product into markets and have successful launches of new products where we, I think, we can get better in the future compared to the history. Optimization G&A, one topic is a shared service center where we are on plan. And then I think what's also important is that everything is the backbone, the IT backbone we have we are investing into that. And this will help us to be more lean, to have more clean processes, and to be more efficient on the cost side but also be able to grow more efficient in the future. As mentioned, my background, I had the opportunity or the chance to run a high-tech robotic company for more than 10 years. Part of my DNA, besides having also had a cost program at the beginning, is really to get innovation into products and products to customers and thereby develop a great customer journey. What I really like about Dormakaba is, as I mentioned, this big number, this really, hardware, smart products which you can connect, but it's in the end smart and connected hardware, which is a strong basis. We have engineering capabilities to work on solutions. And then in the end, on top, we have intelligent solutions which allow us to have an integrated solution for our customers for the verticals. And the verticals are from airports over hospitals to sports. One example which I want to show here, which I think is something where we can really add value on the life cycle of innovation, a life cycle of buildings, is which I like to present, it's a sophisticated technology like MotionIQ. So what's happened with MotionIQ? The door only opens when a person really wants to go through. And it's important that then we can calculate the opening time and speed. And it really has a big impact on the energy loss. And there's one example. And the other one, additionally, we can also help and enable customers to measure the impact on energy loss with a calculator, helping them to achieve economic and ecological objectives. And I think that really shows how we can combine innovation, technology, with sustainability, and here helping customers to be more efficient. Here we are at the forefront of innovation, customer centricity, and ecological thinking. I think that shows that, you know, based on the sustainability, the MotionIQ, we should sell more products, more hardware products from us based on a solution, and here together with a customer to benefit both sides, with more products at the same time with a more full solution from our side. This is really a differentiator for us. I think here we can do more, with this one dormakaba globally but locally having the right versions of the product. Two more topics I want to show you today. I think it's interesting being here now for two months. It's, I think, a first shot on the product and on our potential for sure. In the next meetings, we will have go more in detail on this one. but also here, we are a customer of choice around the globe. So one example which I like is the development in the healthcare sector, to transform the healthcare sector in Canberra. It shows one of our strengths where we had a prestigious project in a competitive environment. And it's Touchless Access and Door Automation System, which are substantial assets of the hospital environment. And here, it's about health, safety, prevention. And these are examples of how we want to replicate the success in hospitals around the globe. Another one which is a solution which we can roll out globally, or we mentioned, is the we also are a provider for access for the State, the Paris, the State of France and Paris during the Olympic Games in this summer. Another area where we are a strong partner. And at the same time, we have room for further growth. I mentioned Super Bowl earlier. So you can see here you can see really solutions where we Dormakaba can play our full range of products and have a solution for the customer which is differentiating to other offers given in the market. Having seen some of the potential on the product side, now coming to the numbers, the performance, as you know, as of August, we are showing our two major business segments, the Access Solutions and the Key & Wall Solutions. We'll start with the first view on the group. As mentioned, shortly to repeat, organic growth 3.9%, 0.8% volume growth, strong currency translation 6.7%. And important to note that in achievement of a significant margin improvement of 160 basis points. Going one level deeper, even, you know, we have higher growth of 4.5% in the Access Solutions division and an adjusted EBITDA margin of 15.2%, also better than the group average. What is important is that nearly all markets delivered on the growth. That means also that we have a solid performance, even though the translation effects on the Swiss franc show that the top line number is reduced, but it's only translation effects. If you go on the next page, you see the local currencies, you can really see that organic growth in all core markets except U.K., Ireland. We see in Germany high single-digit organic sales growth driven mostly by volume increase. You see USA, Canada, mid-single digit mainly driven by pricing. Switzerland, Australia, and New Zealand, low single digit mainly driven by pricing. As mentioned, U.K., Ireland with more challenges after Brexit and the declining attractiveness of the service business, which we are currently reviewing. I think it's very good that we show here that we are growing in these top markets which are on our list, and that further can drive the business here in this region. On KWO, we do have a good momentum on mobile walls, mainly in the U.S. We see that the OEM business, which is mainly driven by activities in China, declined due to lower demand. However, what we can see is that the margin, we safeguard our margin, also the sales is lower. We could safeguard our margin in OEM and key systems. With this one, I will hand over to my colleague, Christina, to give you more guidance on the financials. Please. Thank you, Till. Also a warm welcome from my side. I will take you through the first half year of financials. And I must say, if I look back at my first presentation for Dormakaba a year ago, I'm very proud to see the progress, especially on the profitability and the gross margin. This is hard work, a lot of initiatives that we step by step with a lot of discipline and commitment are implementing. And it's starting to pay back. So it gives us a lot of motivation to see the margin improvements. And we are. It's making us confident that we have taken the right actions to bring dormakaba back to where dormakaba should be. First of all, on the key figures, a lot mentioned already by Till, solid organic growth, price 3.1%, volume overall 0.8%, 3.9% in total. And Access Solutions, our largest segment, even slightly better with 1.1% as volume growth and 4.5% organic growth. No acquisition or divestment impact on the top line. As also already mentioned, a very strong Swiss franc resulting in a negative impact after consolidation in Swiss franc with 6.7%. Transactional impact on EBITDA, important to mention, is mitigated by natural hedge as we, of course, have a strong Switzerland, but also markets like Germany and US are larger than Switzerland. And we also do accordingly a lot of the procurement and also staff agreements in these currencies. Adjusted EBITDA improved significantly because of good pricing, favorable product mix, supply chain effects that really started to get normal again, if you can express it like that, and above all, operational efficiencies and procurement initiatives in the transformation or Shape for Growth program. Net profit decreased versus last year because of the one-time restructuring expenses, that occurred in line with our planning but also due to higher interest and tax expenses. ROCE improved due to the higher profitability as well as our tight net working capital management, especially in regard of the collection of accounts receivables. I'm very proud to say that we achieved a similar level as we had a very good level in June. For example, the average accounts receivable days for the group will be 54 days. A very good number which is not holding us back to become even better going forward. Good progress seen in these numbers, especially in regard of gross margin and profitability. Coming back then to sales development, yes, currency translation had an overall negative impact. We saw the CHF 95 million that were lost due to the stronger Swiss franc. But we were also able to generate a solid organic growth driven by price and volume. And I think looking at the organic growth, yes, 3.9% is not as high as we had in the last half year. But we need to see it also in the light of that inflation has in most countries gone down. And it's a very, very solid organic growth compared with competition. We continue to compensate inflation with higher sales price. That has been our target. We have achieved and delivered on that. And that we continue also to set as a target. All Access Solutions core markets saw organic growth with the exception of U.K. So we have to admit that U.K. is in a special situation after Brexit. And we see that we are working extremely hard and compensating the lower volumes, and also partly price level that is especially in service less attractive by having a very tight cost control. So the impact on the bottom line is, is very, very limited if at all. Rest of the world overall mid-single-digit organic growth. And Key Wall and OEM, strong demand as mentioned, the movable walls, especially in U.S., offset by lower volumes in OEM and a destocking. And of course, OEM for us is mainly China where the demand has not picked up yet after COVID but also a slightly lower demand in Key Systems and here related to Latin America. Adjusted EBITDA development, as I mentioned, very, very proud to present our significant improvement, in EBITDA and EBITDA margin. We increased with 160 basis points versus the half year last business year, which shows that we are on the right track. We have presented in July a transformation program that will take us into the range of 16%-18%, in three years' time. And we continue to deliver according to plan. Operational efficiency measures, procurement savings out of the transformation program but also price realizations and a favorable product mix contributed to the strong improvement in EBITDA. We also had a similar improvement in access solution and even higher contribution coming from key and wall, which means from the movable walls that is since a couple of years on a very, very strong improvement track. Moving on to income statement, the condensed one, we already touched on the main drivers for the top line. So let's go straight to the gross margin. Our gross margin improved by 130 basis points, a very strong improvement. And as explained before, our measures from the transformation program mainly diffuse positive impact from operational efficiency or plant productivity but also procurement initiatives together with good pricing and a favorable product mix strengthened our gross margin. You can see an increase in sales and marketing, general administration, and R&D. This is all in line with our plan. These items are partly affected by one-time cost but also by inflationary increase in wages and salary. As I said, all under control and in line with our plan for this year. Due to the one-time cost, our EBIT decreased to CHF 88 million. Our financial result was impacted on one-hand side positively by the sale of 3DB, which was an associated company, and negatively by higher interest expenses. I remind you we had a refinancing exercise in October 2022, which obviously only had, from an interest perspective, limited impact on last year's first half, now fully impact. Our net profit total achieved CHF 48.5 million. Regarding IAC, we had CHF 25 million of goodwill amortization included based on our early adoption of the new Swiss GAAP FER 30 as well as expenses related to our transformation, which was round about CHF 50 million. These transformation costs are related to on one-hand side reorganization or severance payments that we have provided for in those countries where we have achieved an agreement but also coming from external support in the area of consultancy, all in line with our expectation. Also the numbers that we mentioned, the one-time or adjusted numbers in July, are still on track. Please note that we will build further provisions for our transformation program at the end of this financial year. We have especially Germany where we are not yet signing off an agreement with our social partner. The negotiations are proceeding in line with expectations. This will obviously then also in the second half have an impact on our net profit. Proceeding then to cash flow, when we presented our full-year results at the end of August last year, I said that for me as a new CFO, the cash generation issue is extremely important. And especially as we now are tackling the one-time transformation costs, we need to make sure that we are trying to make up and compensating in the cash flow as much as we can through a very tight net working capital but also step by step improving the profitability. And this continued to be the case. It's one of my main targets. And we made further progress, progress which you can see in the line cash generated from operations, which increased with CHF 8 million, CHF 8.4 million to CHF 146 million. This position improved mainly due to a very tight working capital management, especially with regard to the accounts receivable. Net cash from operating activities were impacted slightly by higher tax, and higher interest payments and declined to CHF 89.8 million. As mentioned before, we divested 3DB. In addition, we also sold some real estate in France and the U.S., which positively impacted our cash flow from investing activities. Free cash flow increased to CHF 63.8 million. The operating cash flow margin was 6.5%. My last slide is net debt. Net debt slightly declined and ended at CHF 586.5 million. Our leverage ratio improved to 1.5. On reported EBITDA, the leverage ratio is different as we included the cost for our transformation program as so-called items affecting comparability. On reported EBITDA, the leverage ratio is at 1.9. We feel comfortable as we go through the transformation with our current situation and will continue to work hard on our net working capital management, all to manage the downside from the continuous transformation or one-time costs. That concludes the financial results. I would like to give back to Till to talk about the outlook. Thank you, Christina. Before we close, some ideas, some remarks on the outlook. We act in a highly attractive market. I think mid- to long-term, this will be a more growth market. But I think what we see is that short-term we have some challenges. The macroeconomic environment is still challenging with high interest rates and inflation. However, we have a good business profile, as mentioned, on the product side with our hardware engineering and solutions business. Also, the industry is in favor of intelligent, networked and increasingly cloud-based solutions where we have potential with strong market, some topics we already have, some we have to develop. Also, we do have only a visibility of two months. We see that currently our order books are at a good level for the coming months. We will focus on sustainability as seen in the project, on innovation, and clearly want to continue and improve on the operational delivery. With all this said, despite all the uncertainties and also the commitment and the continued focus on the Shape4Growth program, we expect that organic growth is in line with 3%-5% mid-term guidance. And we expect that our profitability shows sequential improvement above the performance of the year 2022, 2023. I think our goal ambition will be that the full-year numbers on the margin side are in the ballpark of the half-year numbers. With this, I thank you for your attention. Christina and I are happy here to take your questions. We'll hand over to Siggi again. Thank you. We will now. Alicia, we are ready now to open up for questions. Thanks. We will now begin the question and answer session. Anyone who wishes to ask a question or make a comment may press star and one on the touch-tone telephone. You will hear a tone to confirm that you have entered the queue. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use only handsets while asking a question. In the interest of time, please limit yourself to one question and one follow-up each. Anyone who has a question or a comment may press star and one at this time. Our first question comes from the line of Patrick Rafaisz, UBS. Please go ahead. Thank you. Good afternoon, everybody. My question would be on the Shape for Growth program. And I'm especially interested in hearing Till Reuter's thoughts on that program, if the setup is right, if there need to be any adjustments. And as the follow-up to that, can you give us a bit more color on where we stand on the site closures? I hear you, right? Germany negotiations are continuing. But when should we expect some news flow? What kind of one-off charges should we expect for the second half? And what about other sites maybe outside of Germany like the U.K.? Thank you. No, Patrick, happy to answer. And I think it's I will give some ideas. And then Christina, can I have some more details on the one-offs and so on? So, you know, as mentioned at the beginning, though, I didn't start at the 1st of January, but I had been in the board since October where at this time, the management was presenting the cost program, the efficiency program, where I could already discuss some topics. The main focus for this time was on operations, on G&A, procurement. We have more to come on the cost program, which we are planned. You know, the cost program is over three years. We are in the middle of it. So far, we are on good progress. Looking into the sites and having been traveled around in some areas, I think there's more potential to look when we look at the go-to-market product focus and which customers and how to work with the customers. I think that's a little bit too early now to talk about this. But this will be the go-to-market will really of the topics I will comment on in the next coming meetings, which is currently on the agenda, which is in the middle of the process: the network, the operations network. If, when I look from the outside also being in the board and now CEO, too many sites, too much complexity. We are in the middle of it. So, we are actively already moving parts and production from Canada and U.S. to Mexico, Nogales. We are in the process in Europe, especially Germany, to be in negotiations with the works council where I cannot give you an update today. But we are having good progress. And we are on time and on plan. I think we will report for sure more at the year-end. But this is ongoing. And I think it would be not, it's not the right time to talk. I just can tell you that I think here we are on the right track. And given that we are now focused on this one, I see more potential on the go-to-market. And what has not been done yet in the program is this reduction of product complexity where we have more benefit like a, I would call like a product clinic. When you look at how many variables do we have, can we reduce variables to less products, which doesn't have an impact on operations and on supply chain. So I think this is one of the benefits. And clearly also then looking at the solution that you have a toolbox of products adding to more solutions, which based on on less components but more customer solution, I think something we will work on. I will work on together with R&D and sales. And I would lead to Christina on the one-off charges, which are, you know, clearly the area you have the most expertise. Thank you, Till. Yeah, I mean, it's still early stage. We are talking about the first half of a journey of six half years. So I think it is right to be modest. But we are based on our plan on track. And if I start with a question about the negotiations and provisions made for laying off staff, the staff numbers that we presented in July last year with 1,800 gross and 800 net are still valid. Obviously, some countries are more hit by this than others. And as Germany is our second largest market, obviously, also Germany is a big part of this transformation. We have in a number of countries come to a sign-off with our social partners an agreement, like for example, in Switzerland. And we have even started to execute some of the layoffs in Switzerland. Also in a number of other European countries and U.S., Canada, we are proceeding as planned. I think it is normal in any group that Germany is when it comes to these kind of negotiations. But also the size of the reduction in Germany is the largest challenge. We have a good cooperation. We are negotiating. And we are convinced that we in the second half will be able also to conclude together with our German social partners and reach an agreement aligned with our planning. But it's normal that there is a longer process in Germany for this kind of changes. And we also need to keep in mind that many of these changes are larger than what Dormakaba even saw in 2015 at the time of the merger. So certain things need to be digested, discussed, and both parties talking about what makes sense. I think we have disclosed that we have Items Affecting Comparability in the first half of round about CHF 46 million. More or less half of that is relating to those countries where we now have provided for layoff of staff. But it's not including Germany. We will see Germany being added in the second half. I think also in regard of transformation, we said it, this summer when we presented the plan but also the last year's result that the first year of the transformation, the focus, and the largest P&L impact is coming from operational efficiency, running our clients in a more efficient and agile way, but also procurement, in making sure that we are doing those things together where it makes sense to do it together. We can see that this impact for this year, which is mainly not related to laying off people that will follow in year two and three, we are on track. We have seen good progress on this, which also helped us to see this clear improvement in the gross margin and in the EBITDA margin. Okay. Thank you, Christina. Our next question comes from the line of Tobias Fahrenholz with Stifel. Please go ahead. Yes. Hello. Hi. quick, quick follow-up on these special P&L items. What is the best guess you have for the position Goodwill amortization in the full year and the next one, two years? So, when, when, when should it end? We had a Goodwill amortization impact of CHF 25 million in the first half. We are expecting a similar number also for the second half, so CHF 50 million on a year-over-year basis. I think we disclosed that we are expecting a similar number also for next year, slightly lower. and then obviously, the number will be reduced over the next coming years to then disappear. So CHF 50 million is the number for this financial year. Okay. Could, could I also maybe quickly ask on pricing? What, what do you have baked into your full-year guidance here also for the second half? What's in your midterm, gross guidance of 3%-5% or more? I think on pricing, as I mentioned, that we, we see that the environment is still challenging with high interest rate and, and inflation still on. So we believe that the pricing power is still on and that we see a comparable pricing power as in the first half, which, I think looking more in the future, I think the pricing power if inflation goes down, there will be a change. But we see that in the second half, it will remain on similar levels. Okay. Thank you. The next question comes from the line of Martin Flückiger, Kepler Cheuvreux. Please go ahead. Yeah. Good afternoon, ladies and gentlemen. Thanks for taking my question. I've got several. But I'll step back in line when I'm done with the first two. Just to clarify on the previous statement you made, Till, regarding pricing power. So I guess you were talking about absolute levels of pricing of price selling prices. What does that mean in terms of price growth or pricing as a component of organic growth in the second half? That's my first question. You know, you have seen that in the first half, we had 3.1% of pricing, 0.8 on volume. I think for the second half, we saw some like 2%-3% price increase and, fighting for more volume growth on the second half. Great. Thanks. And, just to come back to the, the product mix improvements that you've, that you've seen in H1, could you elaborate a little bit, which, which product clusters that pertain to and, and what your expectations are going forward? Thanks. I can give a couple of examples. I, I can say as a finance person, I'm a big fan of, the simple product door closer. It's unbelievable. It's a it's a product that is fairly simple, good pricing, good volumes, and low risks. And I think one of the reasons why we last year said that we, we were also impacted by the other way around. We had an unfavorable mix was that we were not looking after the simple door closer business. I have seen this first six months that we have been generating much more volumes in this area. So, that is something as an example where we are deliberately making it more obvious which of our products if we have an influence - and I think we have - we should drive harder in the markets. We also see that the service business, which has never been the most profitable business, but obviously, service business is also generating spare parts, we have seen in some markets like U.K. that the price level on service business is even tougher than it has been. and that also includes then that you really need to be tough enough to say, "This is the price level that we accept." And if it goes below that, no, thank you. So you will probably see, for example, in UK that we are losing a bit also in the second half in the top line because we reduce the service business. But it helps then to improve the bottom line as this is not a very favorable business in UK right now. So these are examples where we are financially making also it more visible to the organization that we have quite significant margin differences. And if we then have the possibility to drive the right products harder in the go-to-market, then we are definitely doing that. Okay. Thanks. The next question comes from the line of Martin Hüsler, ZKB. Please go ahead. Yes. Good morning. Thank you for taking my question. So first of all, can you share some maybe highlights on low-hanging fruits, in respect to the Shape4Growth program, maybe some quantitative numbers on what you did on streamlining the supplier base or shrinking the IT systems? That's the first question. Maybe I start off there. If we look at the procurement side, first of all, and I think we have said this many times, but now we are really doing it, we are obviously, in some areas, shrinking the number of vendors or suppliers that we have to increase our purchasing power in those areas where it makes sense. I think not too long ago, Dormakaba had a vendor or supplier number which was above 20,000. We are now down to 16,000 by the end of December. And we probably will get a bit further down. This has helped us to improve our terms and conditions with some of the key suppliers in bundling our purchasing power. But we have also in procurement, I would use the word, become a bit more aggressive. I think it is important as the inflation rates have gone down in most of our key markets and that we are also brave enough to claw back a price level that is no longer justifiable. And we have done a lot of this hard work to claw back prices, as the inflation rate has gone down but also as the supply chains around the world in regard to most materials and components have been normalized. That's one from the procurement side. I think I can add something because I was now traveling to Nogales. I have been to Asia. I will also go to Sofia. One topic is that, also in procurement, we have to localize more. So, you know, once you move from Europe to Western Europe more to Eastern Europe or from U.S. to Mexico, at the beginning, you still have the, the suppliers which are more spread over the U.S. And I think what's important that in the second step, we are localized suppliers, which will also have a big impact on, on supply base but also on efficiencies. And the second topic is, where we also discussed for a long time is about the product portfolio. I think what, what Christina mentioned on the supplier side somewhat is mirrored also on our product portfolio side where we have, a broad range of products which I have also seen in the past. One of the projects I will take care of will be, how can we getting have a more efficient product portfolio like a toolbox where we can have based on standard components, have high variety but don't have a variety which means like complexity on production supply chain. Here is a huge potential which I do see and which then has an impact on operations but also on the supply side. To have here a number would be too early. But try to have a number, in the next coming months, you know, for this product portfolio. And I think then clearly it's also like the go-to-market, which products are important for the customer side. So I think low-hanging fruit is somewhat when you are in the program in the middle of it, it would be a big surprise. You would have some low-hanging fruit. We see that the team is making progress on the margin. So low-hanging fruit should be identified. And now it's really on getting the operations platform done, which is a big step and also a big change, looking at the history of which Christina mentioned, 2015. And, you know, that I think we have to really accelerate the move towards east or south in the US, to have our network more efficient and then also have supply chain adjusted. And also, I think the shared service is same, same message. So I think in some ways, we are later to the table as other companies. And it's on Christina, the team, and me to accelerate that we're getting this done in the next two years, two and half years from now because program is three years. I think we know what we have to do. It's about execution as always. Execution is key. To get better in execution. Okay. Thanks a lot. Then I have a second question on the German market. I'm very positively surprised by the strong development you achieved there, almost 8%-9%, I think, in organic terms. What's the driver for that? I don't think it's the market. Is it share gains that you achieved there? Is it a low base? What's your take here? I'm not an expert on the German market. But I would maybe kick off and say that we have developed, in recent times, a number of products that have been, I guess, the right product for the German market. So that has helped us. We have also been benefiting, especially when it comes to project business, which also gives us beyond volume growth. It gives us a very stable and I would say many of these projects goes 12 months, helps us here to stabilize also the demand. So we have been lucky. For example, airports in Germany that have invested have a strong commitment to Dormakaba. And winning one, you win the next one as well. So especially in particularly when it comes to these kind of projects in the health area, in hotels, and also airports. And of course, there has been also quite a lot of investment made in Germany after COVID and the opening up. But also in the area of AS and automatics, Germany has offered us really good opportunities. I think it's also important to see, Germany is number two in regard to size for us. But we are not mainly competing in Germany with the two larger players. We are competing with regional players in Germany. And I think there, we have an advantage with our portfolio of products but also our brand name. I mean, obviously, Dorma has got deep roots in Germany. And this has helped us in the German market. So we are number one in Germany, and we have been able to build on that strong market position. I can just add, but it's too early. I would comment in a later time. I think that we have in Germany the most complete offering locally because of this hardware basis which is strong. We have a consolidated controller world. And we have the offering in the digital world which I think is strongest in Germany where we can benefit then from the solution to sell more products. And I think that's something which I mentioned when we have, like, location that we are locally strong and have to build on the global footprint, to be then have the right model for the location. And I think it's I can add. I think it's very important in general to recognize that Swiss market has got a profile where the residential area is not very important. It's very important for Swiss market in Switzerland where we have a very strong position. But otherwise, residential is representing less than 10% of our top line. And it is, above all so far, the residential area that has been suffering. If you also read what the competition is saying, they are stressed by the larger portion that they have in residential than we have. So the non-residential or commercial area has been suffering less both in Europe and in America. And that, that helps us having this profile. Okay. Thank you. Well understood. Once again, to ask a question, please press star and one on your telephone. Star followed by one. And the next question is a follow-up from Mr. Flückiger, Kepler Cheuvreux. Please go ahead. Mr. Flückiger, your line is open. You may ask your question. Yeah. Sorry. Having difficulties finding the unmute button. Sorry about that. We know this. Yeah. So, just trying to get a little bit more granularity on the short-term outlook, firstly regarding wage inflation. If you could put a number on that, item for the first half, 2023, 2024, and, and preferably also, you know, for the second half and, and for the next financial year, what kind of what kind of increases you're expecting there. We're talking more about 3%-4%, 4%-5%, 5%-6% or any, any other range. That would be really helpful. And the second question is, with regards to the, sequential EBITDA margin improvement, adjusted EBITDA margin and development in the second half. You know, I understand that your guidance refers to sequential annual improvements. But I was wondering also because as if I remember correctly, over the last few, half-year periods, we have seen consecutive improvements. And I was wondering whether, H2 in financial year 2023/24 would be, similar to, let's say, past year in that respect. Thanks. Thank you. Thank you, Martin. I will try to start with the inflation topic. I wish I would have the crystal ball here, because that would help me as well. But if we look back at the last six months, we were planning to see a wages and salary impact somewhere between 4%-5% for the group in total. And that's also what we have seen. I have a hope that the second half will be slightly lower, because that is what we have seen in the last two, three months. We have seen inflation rates in many countries going down. We have also seen in some countries unemployment rates starting to increase. And the pressure then, especially when you replace people, is a bit less than we saw, for example, in the second half of 2023. We have planned 4%-5% for the year. If we can gain a bit here and not have that same effect in the second half as planned, it would help us. I think if it helps us, it will obviously also then, we convert to the price side where we now said 3.1% positive impact in the first half. I think we should not expect, that we will have, more than that, more like slightly below that in the second half because, of course, they are tied together. If the inflation goes back, then the customers will not buy into the argument we need to increase the price due to inflation. It's a trade-off there. If I look at then as we are in the process now of kicking off the budget for next financial year 2024, 2025, we are expecting in most countries inflation rate to be somewhere between 2%-3%. I just saw yesterday that it's going back a little bit more than maybe the markets expected. But 40% of our cost base are people cost. So I think it's more important than anything else is how the salaries and wages will develop, and especially in our biggest market, U.S., because that was a rough journey in 2022, 2023 where we had to adjust a couple of times the salary level in U.S. upwards not to lose the key people. So we are quite confident it's going in the right direction. But beyond this year, I wouldn't really, I think a geopolitical event, something happening can change the whole situation quite fast. But we are planning with 2%-3% in the next financial year and right now, 4%-5%, for this year. We then had the question on sequential improvement. We have guided, starting off last financial year with an adjusted EBITDA of 13.5% that we are in the 2025, 2026, in the year three, of our transformation that we will be somewhere between 16%-18%. We will probably, we will get over the 16% which is psychologically so important for us because we have never been there. And we still hang on to that, so year by year, an improvement. We have, and you're absolutely right. We have a seasonality that has been in most years, the second half being weaker than the first half. But I can assure that with good cost control and with a lot of continuous improvement, we will drive very hard in the second half, to not see a negative impact. But we need to keep in mind that especially months like January and February are low months for us, from the seasonality. They obviously have got a negative impact on the second half. But we have agreed and communicated a sequential improvement year-on-year. I think we dare to say that we are expecting to keep the level. Thanks. Sorry, just to clarify, I didn't get your answer regarding the Items Affecting Comparability guidance for the full year. Could you just repeat that, please? Yes. The guidance is we have said that in total, the OpEx amount that we are expecting is CHF 225 million for the full transformation. We have now taken CHF 46 million in the first half. Most of this 225 will be this financial year and next financial year. You should expect that the second half, especially in the light of what you normally need to restructure Germany, it is a sufficient number of people. It always costs quite a lot. My expectation is that the second half will be even more than what we saw in the first half. Okay. Thanks. Thank you. There were no more questions at this time. Back to you for closing remarks. It's no more questions. Thank you for the interest and your time. So as usual, if there are any questions, please reach out to Investor Relations. I wish you a good day. Thank you, Marcelette. Thank you. Ladies and gentlemen, the conference is now over. Thank you for choosing Chorus Call. Thank you for participating in the conference. You may now disconnect your lines. Goodbye.