Good afternoon, and welcome everybody to the first Capital Markets Day. I think you all have a seat. I think we can start, and I will open asking Antonio Di Brino to give you some introduction and remarks. Thank you. All right, welcome everybody, and good afternoon. Today we're gonna talk about the H1 financial results, followed by our Medacta's first Capital Markets Day. Before we get started, though, I would like... And we have a pretty busy agenda, as you can see. But before we get there, I'd like to give you, I would like to draw your attention to our disclaimer, which can be found in our press release and in our half-year report that have been published, earlier this morning on our website. In essence, during both presentations, we may provide forward-looking statements, which are based on current expectations and assumptions, and are subject to risks and uncertainties. Now, for a special welcome, it's my pleasure to introduce our Founder, Chairman, and President, Alberto Siccardi. Thank you. Again, welcome everybody. It is my difficult task to explain my role in the company, but I will try. This is a family company, then there is a family behind it, since three generation. When I was 75, I left the company because I was sure that my children, well they are not children anymore. It was better not to disturb them because they were good enough to grow and manage the company, together with managers I have hired with them in the past, and we made them grow with us in what we call company culture, which is the development of a family culture. Then, when I was 75, I left, but I'm still there as a president to participate into the guidelines to move ahead the company. Which guidelines? I don't know which country open again w e sell in 67 countries, by the way, and we have not such a problem. But important was to us, to me, to give the guidelines to integrate correctly the one hundred new employees we hire every year. Because the integration of 150 now they are these new people in a company is like to buy a small company and integrate it. This was one of the main concern. The other ones are the usual ones, which are the tasks of a president, the financial overview, and as a father, the correct balance amongst my children, and I call them again children, and the managers, because we know that companies can be ruined if this balance is broken. Together with Francesco, Maria Luisa, and Alessandro, and all the others, all the managers we have hired together, we try to be able to go ahead in a correct way 15% increase of sales every year is not a joke. I feel that the control of the company must remain in our hands, because we believe in this company. We don't want to lose no power and no economical advantage in the years. I can guarantee you that my children are good enough. My children, my daughter, you know, probably, you will talk about what you do. Fine, fine s chooling, management, of the, of the well, the family office, et cetera, then she takes away a big part of our concern. Alessandro is supply chain, purchasing, production, and distribution in 67 countries. And then, last but not least, Francesco, the CEO, I give you the floor, they say. Thank you. Thank you very much. Thank you, and welcome from my side as well. It is a pleasure to host you finally in our first Capital Markets Day. I think it was long due, but now it's the time, so let's proceed. I think we're gonna start with the H1 results. Which have been... and just published this morning. The highlights are here. A very good performance in terms of revenues. We reported those already, so there's not any news if you want, but still a very, very robust number we are very proud of, well above the market, well above all our competitors. In terms of geographic segmentation, Europe is still growing faster than the other areas, around 16%. APAC and North America had a very healthy growth to 12% and 11%, respectively. Product-wise, and this is something I will stress maybe later as well, more in details, we see really a huge opportunities in knees, where we are experiencing a very good growth, around 19%, in H1 at cost and currency. Shoulder, almost 40% growth rate. Of course, starting from a smaller base compared to knees, but it is a product line where we expect to continue to grow, maybe not at this pace every year, but definitely continue to grow for many years to come. And then the hip and the spine, which are still delivering very high growth rate, most of the time in line or higher than our competitors. When we talk about new products, we talk about how we introduce products in the market. The stress is always on the medical education, and how we introduce products in the market through medical education is something very peculiar at Medacta, and something that Medacta is respected for, and is probably part of our success. This first semester, we have celebrated more than once around the world, our 25th anniversary in Lugano, in Sydney, in U.S., in different locations. And so you will see as well some additional celebration in the second half, but we definitely had a concentration of marketing efforts in H1. Supply chain did a very good job. We did not face any issue in terms of supplying this very good growth, and this is thanks as well to our investments, both in net working capital, in the supply chain expansion, something that you have seen firsthand today here with us. Marginality was pretty much in line with last year at constant currency, despite, as I said, the fact that we have an H1, which was heavier than what we expect in a full year, and this is pretty much in line with our plans. We expanded our sales force and production by roughly 100 employees, roughly 50/50, and this is just in H1 s o most likely, every year, we are adding close to 200 employees, or at least this has been the pace in the last three years. We did posted a very significant jump in EBIT at CHF 38 million, an increase of almost 30% w e will go through the details. Once again, we were able to post an overall growth well above the market. Some key financial figures that recap those aspect. For me, what is interesting is especially the consistent trend we have been able to delivering in the last five years. Today, during the Capital Markets Day, we will highlight as well what have been delivered to Medacta since the IPO t his gives you a little bit some visibility on some selected financial figures. In terms of growth, orthopedics is very well known for be very capital intensive t his is not Medacta, is orthopedics. It is more specific to Medacta simply because we grow faster. When we grow faster, it means we can attract new customers. When there is a new customer, basically, what we need to give them is this. So CapEx, new instruments here, and net working capital, sets of implants. That is physically just one kit for one knee. If a big customer is starting, it needs probably two, three, four of those. The value of this, we know, we share the ratio with you, and we will repeat it over and over. $1 of growth is roughly $1 of CapEx and $0.5 of net working capital. If you grow faster, you absorb more cash. The rest of the CapEx is still related to growth, which is something you have seen as well today. New plants, buildings, new machines, which are fed in according to the supply chain request, and of course, the sales forecast. Then we have the R&D and the other tangibles. Basically, if you look at the CHF 54 million we invested in the first semester, basically probably 34 plus 11 are growth-related CapEx. If you slow down this, this becomes cash i don't want to slow down. We commented already about the geographic areas, so I will not go too much in details i f there are questions about it, I will be more than happy to answer, and the same applies to the product range, where we see the different performance according to the different product lines. Maybe just a reminder which is useful, hip and knee share the same sales force. So whenever you have a very successful product in your bag, you tend to lead with the most successful one. It has been the hip for 15 years. And the knee was following. Now we see the other way around, and that's a little bit the scenario. Extremities is mainly shoulder, which is growing extremely well, and spine, which is still at a healthy 10%, which is roughly probably two times the market or a little bit more. That's the revenues in terms of product line split for H1. Once again, just to share the trend by product line, in the last five years, you really see a very good constant growth rate across all the product lines throughout the year, despite the fact that of course, especially 2020, 2021, we all know what happened, and so I would say we fully recovered, most likely better than most of our competitors immediately after COVID. This was my last introduction on the top line, and I would like to ask Corrado Farsetta, our CFO, to take the floor and continue with the presentation. Thank you very much. Thank you. Thank you, Francesco. Good afternoon, everybody. I would like now to show some numbers, the first semester 2024 results. Here you see our usual P&L. I wouldn't say anything else o n the top line, the growth was 14.6%. The gross profit result is, this period was 68.5% compared to 68.9%. It is, I would say, a very good result, which shows, let's say, the ability of the company to defend the marginality. The reduction you see there is almost entirely attributable to the effects that we experienced in this semester. Moving down to the fixed cost, we have to call them fixed costs, but actually, in a company growing like Medacta, those are big t he biggest part of those costs are variable costs. Because if you look at, for example, the sales and marketing costs are, as a percentage of revenue, growing, and this is also reflecting the unusual concentration of cost related to the 25th anniversary that we had in this first semester, just mentioned by Francesco. The other costs are more or less in line with the previous year, 3.6%, the research and development cost, 3.5% this year. SG&A, sales and marketing, already discussed, and G&A, there was a bit of leverage in this line, which is the area where you can have a positive effect coming from the growth on, the organization, the logistics, and also on the finance area. R&D are pretty much in line with the previous year w hat you see here is the biggest part is coming from the depreciation of our instruments, which represent the biggest chunk of our investments, so they are, as a percentage of revenue, they are stable at roughly 11%. The adjusted EBITDA in this semester was EUR 77.5 million, growing from EUR 71.9 million. Those are reported numbers. In terms of adjusted EBITDA as a percentage of revenue, it was 26.9% compared to 28.2%. The reduction you see here is also including 1.2% of negative effects coming from translation into EURO, our reporting currency. You will see a bit more how this is working in our numbers later. The adjusted EBIT was CHF 45.5 million, growing from CHF 43.8 million, again, including 1.2% of negative effects coming from translation, which basically brings this adjusted EBIT to 17% in line with the previous year. Now, having a look at the financial results, here you see an effect which is the opposite of what we have observed last year, l ast year, we had a negative effect coming from gain, exchange, sorry, losses on the financial asset that we have, intercompany assets t his year, we had the opposite, and this is the result of the evolution of the currencies, in particular, U.S. dollar versus Swiss francs. So we had a positive line in financial results position, which brings the profit before taxes to CHF 44.7 million, compared to CHF 36 million of last year. Income taxes were CHF 6.7 million, less than the previous year t he average group tax rate in the first semester was roughly 15%, which is what we think will be the long-term tax rate for the company. This is the result of the final approval of the and entering into force of the Swiss tax reform. Now this is 15%, 15-16% is the average tax rate of the group. Which is basically explaining another part of this very, very good result. The profits for the period was CHF 38 million, with a jump of 30% compared to CHF 29 million of the previous period. Moving to the free cash flow. In this period, the first semester, the operating activities generated a robust flow of cash, CHF 42 million compared to CHF 37 million last year. This CHF 42 million were able to fund the investing activities, instruments, as we said, but also land and buildings, research and development, acquisition of production capacity. We end at the period with CHF 12 million negative, which is the result of the cash flow generation from the operating activities and the investment needed to sustain the growth of the coming years. This is the net financial debt. You see, end of June, under CHF 64, with a very low leverage, 1.2 times the EBITDA, which is comparing to the previous period, 1 time the EBITDA, or CHF 135 million. The net debt remains very low and is normally higher than what we see as a final, say, final number in the year-end results. We expect this to go down to 1 time the EBITDA, but this is a normal trend. The 2024 outlook is confirmed 13%-15% top line growth at constant currency, and 0.5% improvements on a constant currency basis compared to the full year 2023 EBITDA margin. Now we are going to discuss also the mid-term outlook. I can already tell you that the compound annual growth rate that we expect is in the region of low double-digit i will tell you a bit more what does this mean for us. The adjusted EBITDA that we target for the next three years, 2025, 2026, and 2027, is to stay around the 2024 results. And again, I will tell you a bit more of what this means for us. I will hand over to Antonio for some instructions on the Q&A session, and then happy to answer. Thank you, Corrado. We're now opening the Q&A session. We will first take questions from our guests here on site. For those listening via webcast, please submit your question in the Q&A box section, and then we'll address them at the end if they haven't been already covered. Thanks. Please. I'm not sure. Thank you very much for the insights today and showing us your factory for the first time. Leah Newson at KP. So my first question would be regarding the guidance regarding EBITDA. Could you maybe give us some clarification here? why you're referring to absolute number instead of the margin? And then as a second question regarding CapEx, could you give us a bit of color regarding the cadence from comparing H1 versus H2? Can we expect a similar number for H2 and then the full year? Thank you. Sure. So the reason why we give guidance, we gave the guidance in qualitative, let's say, word, rather than precise numbers, is you will see later b ecause there are some, say, trends and reasons behind the evolution of our profitability that you will understand, I hope, later when I will tell you a bit more about our guidance s o basically, there are some drivers that could explain the higher growth. And other drivers that could explain a lower growth. So that's why we wanted to stay in this to guide it this way, but I will try to be more precise in the second part of the presentation to make sure that the number is also associated. Just to make sure, when we talk about EBITDA, we're talking about EBITDA margin, not absolute numbers. It would be quite sad if we stick to the current- Yeah ... EBITDA. Absolutely. Absolutely. We'll- This was maybe poorly worded, but we're talking about EBITDA margin. Yeah. Back to the CapEx question, we say very often that the ratio between growth and CapEx is more or less one euro, one euro. So if you do the math, if you take the top line growth at 14-15%, you get the additional revenue for this year, and that should be more or less the total CapEx number for 2024, more or less. And then if you sub that for the first semester, you get the second one. Can you hear me? Yes. Great. Thanks for taking my question i t's Aishyah Noor from Morgan Stanley. My first question is also on the midterm guidance, but on the divisional growth drivers. Would it be fair to assume that more or majority of your growth will come more from knees, spine, and sports med as compared to hips? And could hips be something of a drag over the midterm for growth? The second question is around cost of customer acquisition or capital outlay. How does the customer acquisition cost compare versus hips and knees? Sorry, for spine and shoulder versus hips and knees, as a function of marketing costs, CapEx outlay, you know, single-use instrumentation or assistive hardware as such? And then my third question is just on the THINK Surgical partnership. Could you discuss the rationale for this? Are you now acknowledging that robotics is a more significant portion of the kind of enabling technology that should help you drive more volume growth? Thanks. Yeah. So I would say on the divisional aspect, yes, for sure, the growth rate we have seen will drive the product mix a little bit in a different direction i would expect knees to become our first line in the nearest future, so surpassing hips, probably getting very close already at the end of this year, given the trend. In terms of, marginality between hip, knees, they are similar. And we have to be careful as well when we talk about, marginality to define which margins we're talking about. Because if we're talking about gross margin, typically shoulder has a slightly higher, gross margin, spine as well, higher gross margin. But then you have maybe higher distribution cost in spine, higher commissions, or simply a less mature organization, which is not as effective as, hip and knees. So just, just to be careful when we talk about marginality. Gross profit, yes, they're not identical, they're similar. But, when it comes down to EBITDA, there are leverages existing in certain segments that are not there yet in, spine, for example, or sports medicine, even, even less. Second question was about, again, the customer acquisition cost, depending on the business line. I would say it's very similar. Especially in terms of medical education, it doesn't matter if you spend, one day to be trained on hip, knee, shoulder, and spine. There are some products, like anterior approach, which have been historically more demanding because the learning curve was, steeper, and therefore, maybe the repetition of certain steps in the medical education were done more than once. This is probably not the case, for example, for kinematic alignment, where maybe one visit or one cadaver lab is sufficient. It could be one of the reason why we see this acceleration, and it's a faster adoption, let's say, which somehow brings customer acquisition cost lower. Spine and shoulder, I would say more or less the same, like knee. Compared to hip, the other three lines, most likely will have a slightly less customer acquisition cost. Last question was about THINK Surgical. THINK Surgical, for those which are not familiar, is an open platform robotic company. That basically has a business model that they sell the robot to hospitals, and different vendors are present in their platform. So they've been asking us to be present in their platform, and we agreed because there's no disadvantage in being present into a third-party platform. We have one additional option today in the U.S. only, because the THINK Surgical robotic platform that we have partnered with is only available in the U.S. We might discuss if they go elsewhere to be present as well. This is just one additional technology together with My Knee, MyHip, the guide solution, NextAR, and now THINK Surgical that is part of our technology offering. Yeah. Thank you. Hello, Anya Pomeroy. Two questions as well. In APAC, you grew in the first half, 12.6%. Could you kindly share with us sort of the difference between Australia and Japan? I think, sort of in terms of growth rates? I think they are the two major markets a nd the second question, also relating to APAC. I mean, Medacta wisely has deliberately not chosen to enter the Chinese market, I think, which paid you off with respect to the VBP program. Is that still something that you will continue to do, sort of still avoiding China, or is there an option maybe to enter China at some point, and would there be any kind of time frame when you would pursue that? Thank you. Yeah. So we don't provide details about Australia and Japan. I would say they have been performing extremely well t he Japanese are more Japanese, so they tell you what they do, and they do it. The Australians are a little bit more creative sometimes. But in general, they've been both performing extremely well in H1, similar s o I wouldn't say that one was contributing significantly more than the other. Different product mix in the different countries, but overall very much according to plans in both areas. China was a decision we took almost ten years ago. We did register our products in China w e still maintain our registration in China. Today is definitely not a priority, mainly because of pricing and the market condition. And of course, when I talk about market condition, I'm talking about the fact that the Chinese government is clearly pushing for local producers, 100%. So the Made in China effort is there s o we have many more options out there where we can focus with a higher level of fair competition, higher prices, more technology-driven or a product and innovation-driven possibility to win. And, as we will see it later, that's, in my opinion, something very important to understand about Medacta we have surpassed CHF 500 million, but there are $38 billion out there to be addressed as a total addressable market. So China is there. We keep it as an option. The same is true for India. So those are two markets that we monitor. We check from time to time, but it's definitely not included in our midterm guidance. Hi, it's Sam England from Berenberg. First question was just around the midterm margin guidance i was just wondering if you're still expecting to see sort of gradual gross margin erosion over time, and then that being offset by efficiency gains and operating leverage on the other side, or does the midterm guidance sort of assume a different mix between the different cost buckets? And then, you know, a follow-up on the geographic side, I just wondered what sort of assumptions you've made around growth rates in the different geographies within the midterm guidance, and how you think sort of geographic mix- Yeah ... might develop on a sort of five-year view. Yeah, so the geographic mix is going to be more or less similar to, let's call it, the average of the last three, four years c learly, the U.S. represent a very significant portion of underpenetrated market. But Europe, for example, surprised us on the way we could pick up market share in the last three, four years, especially. Excuse me. me. Sorry, the beard maybe. So this is not something that we're gonna disclose, but you should not expect a significant difference compared to the historical geo mix, I would say, especially if you take the last three years, maybe a little bit less from Europe and maybe a little bit more from the U.S. The second question, I would like, if you don't mind, to wait for the next presentation, because it is about the midterm outlook, because I think we can further clarify and give some color about those aspects more in details. Cool. Hi, guys, this is Dylan from Stifel. So just a question on that growth algorithm, and just feel free to skip this question if we get to it later. So but what's kind of embedded in that? Is there sort of a thinking about negative pricing kind of resuming? 'Cause, you know, pricing's been quite positive lately. What about market share gains? Are they gonna be on par with historicals? I think the message has been things are pretty much business as usual. And then maybe one thing that isn't kind of as usual, so sort of the ASC shift, right? So that's gonna saturate probably around 2026 s there sort of any thinking about what Medacta is gonna be like after that, and then how are you guys thinking about that? Is there sort of anything specific that's changed, let's say, in that algorithm? First of all, I don't think ASC will saturate in 2026 at all. They will continue much longer in the U.S. we expect at least you will see some numbers based on the current available data a nd what we see as well is that there's still a huge amount of market that is in hospital, and it will take time, simply because we need thousands of ASCs that needs to be built or transformed into orthopedic ASC. So I wouldn't expect 2026 to be saturation. Business as usual, when you grow 20% is not business as usual, at least here. It was exceptional three years. But I would say that in general, we think we to go back to the pre-pandemic growth rate, this double-digit growth. And of course, we included in our model some price erosion. We included in our model some cost optimization on the industrial side y ou've seen a lot of automation, expansion w ith scale, you can bring cost down, et cetera. So it's a cautious view on the next three years, given especially the fact that, as we were discussing before, if we grow on the high end of the top line, we will probably sacrifice a little bit more on margin expansion. If we stay on the lower end of our top line, we might be able to expand a little bit faster, and that is the trade-off between the two. It's very difficult to do what we are probably doing this year, to do both expansion and margin, top line expansion and margin expansion at the same time. But the inflation has been reduced quite a bit, a little bit, more than what we expected, so we are doing pretty well. But we try to be balanced and especially to be cautious in making promises to you guys. Just on market share, I see you don't wanna talk about your peers, but you guys are taking, what is it, 20 basis points, 30 basis points annually? Yeah. I mean, if you take the market, the market is growing, maybe on average, back to 3-4% i f you take 3-4 years, slightly faster because of the post-pandemic wake-up, we grow 2-3 times the market, so by definition, we take market share. If there are no other questions, maybe we can dig a little bit into the financial performance since IPO and maybe a little bit more into the midterm outlook, which I believe is gonna be interesting.... an interesting discussion, and we're gonna have a Q&A immediately after. Corrado? Thank you. Okay, let's start immediately with a nice curve. This is the top-line evolution of the company since the beginning. We reached last year CHF 500 million revenue. 80% is made by roughly Hip & Knee, and 20% is made through our more recent business lines. Medacta is the fastest-growing company in Hip & Knee, and is one of the fastest, organic growing company among the ten largest player in this market. We do CHF 500 million, they do billions, so it's we, and we run very fast, but it's still a long way to go. So this is the important point. So I wanted to focus a bit on the performance, as we say, since the IPO. The dark blue line shows the top line that we delivered, and the dotted line is what we guided at the IPO. Basically, we said low to mid-teens, anticipating a slight reduction in the growth rate. Actually, we did the opposite. If you... apart from the COVID inflection that you see here, we accelerated over the last four months, four years, sorry. In numbers, what does it mean? That basically, the growth since 2019 was 13%, while the market was growing at 2.6%, which basically means that we were able to grow four or five times the average growth of the markets, and this is an extraordinary performance. But if we focus our attentions from 2020 onward, which is after the COVID, the growth rate of the company over the last four years was even stronger i t was 19% as a CAGR at the constant currency. This is a very, very exceptional result because it shows how the company was able to deliver, and this is exactly what I want also to stress. The guidance at the IPO time was a slight reduction. This is important, and you will see why when we speak about acquisition cost associated with the growth. We say that we are the fastest-growing company for Hip & Knee, and here you see what I wanted to say. Basically, Medacta growth in Hip & Knee CAGR of the last five year was roughly 12%. The market on average was growing 2%, which is basically six times the market growth. And those are the players, the biggest players in the market. Sorry. The biggest player, the best performance was doing 7%, and the second-best was 4.5%. This is the gap that there is between Medacta and the other big players in this field. And again, this is all organic growth. This is the guidance for the next three years: 2025, 2026, and 2027. We expect the growth to stay in a range that we identified as low double digit in constant currency. What does low double digit mean for us? We think that we'll see the growth of the company stay within, say, 10%-14% on average, year over year, on the next three years. What are the drivers of this growth? Which is a very strong performance compared to the market, which is expected to grow at 3%. Core market expansion. We expect to continue the expansion in the existing markets where we already are, but we will increase the market share in those markets. We expect to see the knee and the shoulder progressively contributing to the growth of the company over the next three years, and we expect to have also increased volumes in the spine and hip. Sports Med is the last in our family, and we should see an improving and increasing contribution also from this business line. Profitability. This line here shows the EBITDA margin at constant currency since the IPO. At the IPO time, it was 29.5%. Last year, we closed at 30.1%, with an increase of 0.6%. This is an extraordinary performance if it is associated to the extraordinary growth rate that we delivered, because as Francesco mentioned, that the cost associated to the increase of the top line sales force, which is not generating fully, say, the potential of revenue in that year, marketing cost, education cost, all those costs are, t he faster you grow, the bigger they are in your P&L. But we were able to deliver an increase, thanks also to some very effective cost management and a bit of leverage on fixed cost. So overall, the lower than guided, but because that was the guide, that we guided low to mid-thirties, the missing expansion of the marginality is entirely attributable to the faster growth than guided that I discussed before over the last four years. Before introducing the guidance for 2020, for the midterm in terms of marginality, it's important to understand another aspect that it is recurring in all the Swiss companies that are selling also abroad. So the effect. I don't know how familiar you are with this translation, because we are talking about translation effect, t ranslation, let's very simply. If the cost of production of an implant is CHF 100 this year, and is again CHF 100 next year, but if you translate this number into euro, this year can be EUR 100, next year you will see maybe EUR 120. So this is not a real increase coming from increase of production cost. It's just a different way of see the same number expressed in a different currency. Speaking about translation, this is what we have had since the beginning b asically, four percentage points of EBITDA margin reduction due to the translation effect. The 26.3% of 2023 is the baseline for the 2024 guidance, which is expected to go, let's say, the EBITDA margin to go up to 26.8% at constant currency in 2023. This 26.8%, the reported 2024 result, will be the baseline for the EBITDA margin of the 2025, 2026, and 2027 coming years. What do we see here in terms of marginality? We expect to stay around the 2024 result. What does it means? There are some drivers that can modify the profitability of the company t he most important is, as we say, the growth rate. The faster we grow, the lower will be the improvement of our marginality. The lower is the growth rate, the bigger can be the improvements. If we grow, let's say, at 10%, you will see a higher marginality. If you grow at, in the high end of the guidance, 13-14%, you will see a lower margin expansion a nd this is the most important aspect that will affect our marginality. Then leverage, the ability to leverage on the existing fixed costs, primarily, let's say, SG&A, a bit of R&D, but not that much. But we say that sales and marketing costs are almost variable costs? Some positive contribution from the new business lines, Spine and Sports Med, we say they are diluting in terms of EBITDA margin. Sports Med, it's actually a cost, it's a loss today, and improvements on operational efficiency, logistics, and production areas, automation, and so on. This is the guidance that we see as a mid-term target. I wanted to discuss a bit more the cash flow, because this is another recurring asset, and it's important to understand. This is the representation of the additional revenue every year over the last five years since the IPO. For example, in 2019, we generated the growth of CHF 38 million. This is the COVID period, CHF 8 million reduction, and then those are the increases in revenue in terms of millions added. If you compare this with the operating cash flow generating every year, you see there is, of course, a direct correlation, but you can see in 2019, where the growth was negative, how big was the jump in cash flow generating from operating activities. And what do we do with all this cash that we generate? We say that we invest. More or less, you see, for every EURO of revenue generated, apart from this year, you see there is a strong correlation between revenue generated and CapEx. Of course, you can see this CapEx like an extra way to absorb the cash, or you can see the opposite way. It can be a cash generator because this will generate the future increase of growth. So I would prefer you to see this as a cash generator rather than an absorption of cash. But why? We already said, why we need all this CapEx and working capital to grow? Because for every new surgeon, Francesco explained very well, so I wouldn't add so much. Instruments and implant stock for every new surgeons, so for every... If you want to get EUR 1 of additional revenue, you need to invest EUR 1 in instrument and 0.5 in net working capital. What does it means in terms of absolute numbers in our last five-year result? We invest, let's say, we grew, we say, CHF 240 million since the IPOb asically, we doubled the revenue. We invested CHF 270 million, so roughly, let's say, one-to-one ratio with revenue, and we also invested CHF 145 million in additional inventory. Of course, this is a very, very gross average, because there is a variance which is driven by the decision of making extraordinary stock inventory for strategic reasons, opportUNiD reasons s o this is an average that you can take to model the numbers to define the cash flow target as an average in your models. So roughly 80% of the CapEx are composed by instruments and production machinery, which is what we say, we call short-term CapEx growth. And the other is 20% on average, is related to expansion when the buildings and research and development, that we call long-term CapEx growth. This is the effect on our P&L in terms of debt. You see that the debt, the total net debt of the company was and remain very low, with a very, very low leverage i t is 1.15 at the beginning of the 55 years ago, and now is roughly, was last year, 1x the EBITDA. So it means that we have room to leverage the company if we see an opportUNiD to do, even if our priority are, maintain a solid balance sheet to support the future growth, focus on organic growth rather than opportunities or M&A And to keep a stable dividend payout ratio. Of course, with the so low leverage, there is room to take into consideration any type of even extraordinary action. This is my last slide. So as we say, the company, the framework is not expected to change. So we will continue to deliver a very strong and organic growth, well above the market rate. We will keep our robust profitability, we will preserve the marginality, and we will continue to self-sustain the growth through a robust cash flow generation, which will keep the debt of the company at the level, very low level that we already have today. I believe this was my last slide. I hope to be able to clarify some doubts, but now, willing to answer your questions. Yes, better I stay here. Sure. Thanks. Yeah, just one from one of the earlier slides. You called out the dilution to margins from Spine and Sports Med. Can you just give us a sense for how much those businesses will need to scale from where they are today to stop being, you know, a significant drag on profitability, and how long you think that might take based on current assumptions? Yeah. Well, let's say we don't disclose, of course, this type of number, so I can speak only in qualitative ways, but just to give you a flavor. Today, we know that if we take the average EBITDA of the company, on average, the hip and knee business is, and the shoulder as well, is making much more than that in terms of EBITDA margin, which means that we are now financing Spine and Sports Med. The Sports Med is already positive, but still dilutive. And- Spine. The spine, sorry. The Sports Med is still making losses. So how long this ramp up will take to go out and start, let's say, at least be similar to the other profitability? It really depends on how fast you want to grow and the cost you see, and the opportUNiD you want to grab in the market s o Francesco is more qualified than me to explain that, but basically, we think that in the midterm, we should start seeing a positive effect coming from that, even if we cannot quantify because we do not report in that... with that detail. Okay. Thanks. Just one question from me as well, maybe also for, for Francesco. On the NextAR Rod Optimizer technology that you just got approval for or, got an award for, this week. I think your, your team, operations team, did a good job of explaining to us, you know, how differentiated it is. But I think what they were refraining from, or I think what you can give us some contribution to sales or how that sales projection can ramp, in the next 2-3 years. And then, just explain a little bit what the barriers to entry are like for that technology, or how quickly can your competitors, you know, develop a competing solution? Yeah. I think, NextAR, to begin with, in Spine, allowed Medacta Spine to reposition ourself into one of the companies with surgical guidance, which immediately puts you in the top, let's say, 15 out of the 200 plus. That was already very, very important, and was already contributing to some acceleration in certain key markets. Japan is a very good example, Europe, and now in the US as well. The Rod Optimizer, which is something we're gonna touch base in my technology presentation as well, I think is gonna be another very significant booster to our revenues, especially in the US, but as well in Japan, where it is already cleared i t's not yet cleared in Europe. It will take probably another semester, I think, or slightly more w e never know with the medical device regulation. But it's definitely gonna be a key pillar of Medacta Spine growth in the years to come. And for once, this is a product as well, where we do have some strong IP, which is a combination of both method IP and product IP, and it is, in my opinion, going to be quite relevant for quite some time because of that. What is important as well is that when you have those very unique products for, let's say, a portion of the spine, you enter into a customer with something special and unique. And so you can then expand into this customer with, let's say, the bread and butter products more easily. Without those specialty products, you struggle much more. Please. Daniel Elefczuk, als ZKB. Just on the CapEx dynamics, you mentioned rule of thumb, $1 CapEx equals to $1 sales. Why isn't that getting more dynamic over the time? I mean, when a surgeon has the set, he makes maybe fifty surgeries in the beginning, and then seventy, one hundred after three years, so it should theoretically result in- It would be nice. Yes. It would be nice- Uh, related- But typically, when this happens, you have another set to be put. So the productivity of one set is limited to a certain amount of cases. If it's growing, you put another one. Why? Why is that? Because you need it. I mean, you have a patient on the bed, you do a surgery, you use the instruments. The instruments, they go in the washing and sterilization. If he wants to do a second case, you need another instrument set. Because it's not washed and cleaned fast enough, so this is typical of orthopedics i t's not a Medacta situation. This is the reason why you need more than one orthopedic table, you need more than one operating room. You flip rooms most of the time, but even on the regulation side, because of infection, because of resistance to antibiotics, et cetera, the rules on cleaning and sterilization, and therefore, reutilization of instruments, are becoming more and more complex for hospitals. Therefore, it is important to have more than one instrument, but this is standard t he only solution to that is what we have there in this little box, which is single-use. Single-use instruments is one of the way we are exploring to change this capital intensity, and in knees, for example, we have a little bit over a third of our knees, which are implanted using single-use. So in this case, you reduce the CapEx because you have instrument single-use. You sell some instruments with very little margin, so you sacrifice maybe a little bit of gross profit, but under a financial point of view, you change the picture quite a bit. But this sterilization is different from country to country. I think in the UK, you're allowed, and in Germany, you are not allowed, or the other way around, so- I would say- Or-... rule of thumb is the same everywhere. It's very strict, it's, I would say, probably correctly so, because the biggest problem you should fear when, whenever you might need an orthopedic procedure, is infection. So they do really whatever they can to stay away from infection. It's a disaster. I mean, disposable. Oh. That's different from country to country, I guess. Yeah, but just because there is a different appetite for cost, there is a very different profile in terms of volume per center. So in Germany, for example, where they have, let's say, a small center is doing what 1,000 joint, they have a very efficient cleaning and sterilization t hey have 12, 15, 20 sets of instruments, so they rotate those things t hey don't justify a single use. But an ambulatory surgery center, public hospital, less efficient, that's a very good solution. Thank you. Awesome. So just another one for me in spine. So just thinking about the comment you guys just gave us on the product side. I know that you guys had, let's say, more indirect mix into spine, and there's an ambition to go more direct, let's say, more high tech, have your own products, be in control. Would it therefore be fair to kinda say that spine might be sort of in an investment phase where, you know, you might see your gross profit get better because you see the commissions kinda fall off, but maybe your EBITDA margin will kinda lag for a bit, maybe go down for a time, but growth accelerates. Is that how we should be thinking about that business? So this is true only in the US, because in all the other markets, we are already direct. So given the size of the US spine business and the fact that we're not shutting down the distributor channel, but we are favoring or at least putting in parallel, which is something we have been doing for the joint as well in the past. We're putting in parallel a direct channel, especially linked to technology. I think it will provide, frankly, more control and potentially slightly lower cost, but it will still be a variable cost with a highly commission-based incentive on our own salespeople. So this is just a step in this direction. We have started at the beginning of this year. We see some results coming in the second half of this year already, and it's not a new experience for us. The new experience was the opposite, not to be direct, completely indirect in the U.S. in spine. So it is dilutive only if you hire fixed, let's say, direct people with a fixed salary, which is not the case, or not as much. You guys are happy with the access to the reps? Is there a sufficient in the market for you guys? If you have the right products, the good people, they tend to come. It's always a key. If you're a good salesperson, and you have a great product, you come. I think this is a critical aspect i f you have me-too products, commodities, much more challenging, and then you have to play on higher commissions just to... and their margin is gone. Thanks. Any other questions? Excellent, then if there are no other question, I might move to the next portion, which is hopefully interesting, so our growth story and as well why we believe our growth story should continue based on what we've been doing in the past and what we're doing today. I would start maybe just by reminding everybody what's really unique about Medacta is that it's probably the only company founded at least in orthopedics, but most likely in medical devices, by a patient. And this is important for us for various reason, but the most important is that whenever you tend to do the right thing for the patient, you win because you're doing the right thing for everybody. And this aligns the interest of the patient, the surgeon, the payer, and the company. And this is, in my opinion, very important, and it does translate in very, very practical aspect we do at Medacta, starting from the way we want to do innovation to the way we put innovation in the market through medical education. We will dig into this quite a bit. But as my father started this session, I would like to share with you the fact that this is not the first time we are doing this approach within our family. It's actually the third generation. We started with my grandfather in the IV solution back in the '50s, then my father with Medacta early 2000, and as he explained, five years ago I took over the responsibility to continue this tradition. Being founded by a patient and having the president, he said he left the company a s you could tell, he moved slowly but steadily from the back to the front. He's not really absent, right? So it's there. It is important i t is a very useful guidance for all of us to remember that behind what we do, there are patients, and many of those patients now are as well our colleagues, our friends, our parents, our grandparents. So that's something we remember always and all the time. Today, Medacta has expanded a lot since the last 25 years, if you want w e started in hip and knees. We are now active in shoulder, we are active in spine, we are active in sports medicine. But when we talk about where we are active, we are active in the orthopedic market. Orthopedic market is a very big market, around $60 billion market last year, with a market growth, depending on the segment, 3%-4%. This is probably a little bit higher in the last three years, just due to the recovery of the backlog of COVID. And it is a market that has a very attractive long-term drivers in terms of aging population. The expected quality of life that patients in the Western countries and in some of the new economies are expecting to get is definitely driving this market growth. Technologies and performance of those products b ack in the days, 25 years ago, you could not get a hip replaced when you were too young because the materials would not have lasted 20 years, 30 years. Now, it's very easy to get a hip implant done with 45, 50 years old, and the performance of those materials are improving over and over. And then, of course, access. Access means the possibility for patients to get surgery immediately in hospital or even in ASCs. So the market is growing, let's say, around 3% in the last five years, faster post-pandemic with the recovery, but Medacta has been growing two times, three times, four times the market in the same period. So we have been able to capture much more market share, thanks to our approach, and this is the overall market, $59 billion, but if we look at the different segments of the market, you see that all the segments where Medacta is playing are very large segment. $8 billion for the hip, $10 billion for the knee, $3 billion for extremities, which is the vast majority is shoulder, more than half, and then hand and foot and ankle for the rest. Spine alone is another $10 billion, and sports medicine is another $7 billion. So today, Medacta has a total addressable market of around $38 billion dollars, and as you know, we are just scratching the surface with $0.5 billion revenues last year. With this market share, let's look at the competition. Quite a lot of concentration. Seven companies, they represent 66% of the market y ou see them above a billion-dollar company, and they are, all of them, significantly above a billion-dollar company s o there is a very big gap between the very large companies and the second tier, which is between $400 million and $1 billion, and that's where Medacta is present. Out of those companies, in 2023, probably Enovis, after their acquisition, will jump into the left column, leaving Medacta as one of the largest challenger, let's call it, in this segment. But the message is very clear. We have been able to grow this company w e have done the heavy lifting in creating a solid baseline in the most attractive market, and we think we can continue to outgrow the market in the near future and taking more market share. How do we do that? This is, for me, the most important slide, if you want, today, because in one slide, you see exactly what we do, why we do it, and how we do it. So we talk about innovation. Innovation is something that every company has to do, and so it's absolutely critical to define how you do it and what do you target. When we talk about innovation, we have two goals. One is to make sure that our new products do have an impact on improving patient outcome. We really try not to do me-too products just to compete in a market if we cannot deliver some improved patient outcome. At the same time, we try as much as possible to deliver value to the healthcare system, because if you can improve the outcome without increasing the cost or potentially even decreasing the overall cost, you create value. If you create value, then you are rewarded because not only you help the patient, but you save the economy or the healthcare system, quite a lot of resources. The problem of this is that it's difficult. Most of the time, innovation requires more money. We can think about many examples of this, so it's a big challenge. In our history, we have been able to do that by focusing on two areas. One was minimally invasive solutions, so transforming open surgery into MIS, and the second one is through personalizations. Those areas are typically delivering better value for the patient, better value for the healthcare system. Critical is the fact that very often those are true innovations, and therefore, the surgeons are absolutely not trained, not used, and you needed to invest a lot in the medical education. That is our innovation diamond we call it at Medacta, but this has, if you want, all the secret sauce that we try to implement over and over across the different business line, across the different opportunities that we constantly look for. And you will see that more than once, we have been able really to completely change the market, and when you do that, you have a very long way in front of you with success and growth. How can we make sure that this approach stays within the company? How do we make sure that what we have today in terms of innovation doesn't become obsolete because we sit on it, and after ten years, of course, everything is old and copied? I think a foundational success for us to have a strong leadership within the organization, really from top down, that understand orthopedics and has been growing this company, focusing on innovation. This is starting from my family three generation, but then we really focused on making sure that all the people in Medacta are pushed in this direction w hat's the advantage for the patient? What's the advantage for the hospital? Every time we have an R&D meeting, we talk about products. Those are the two items that we want all the project managers to come up with. Marketing, the same. So that is, for us, a must. And the fact that we have senior leadership in the company that has been in orthopedics or in Medacta for 10, 15, 20 years, make sure that this kind of approach is embedded in our organization. And not only we want it from the leadership, of course, but we really try our best to make sure that every new employee that we hire, when we're talking about hundreds every year, goes through the same process nd of course, everyone has his own duties and responsibilities, but if we talk about innovation and if you are in productio. It means maybe you can come up with a good idea to bring down your production cost, y ou can bring down industrial costs, You can do things I mean, processes better and faster. So this portion of values are absolutely critical for us, and we start from the recruitment, onboarding, and rewarding with a performance review every year to make sure that this sticks in the heads of everybody. In order to continue to do that, we really defined what Medacta culture means for us. It was something that we were not used to say and explain when we were small. We were just talking with our employees, and naturally, this was somehow absorbed and shared. But now at this speed, we really had to put in place a lot of processes to try to make sure that those values are understood and shared. And those values you find them here. Of course, we start from what I consider the basics, so the trust and integrity. But then we go into something that is already, in my opinion, not always the case when I look at other companies s o efficient execution, You can do things in many ways w e always want to do it in the most efficient way. So this is something that we judge and rejudge and rejudge every single time. The patient and customer focus is a must, and again, the fact that we have a, a very unique history of a founder and a patient helps a lot to remind everybody. You met during the company tour a lot of employees that I know they are patients as well, and they share the story with, with our employees t hey are part of the onboarding to make sure they understand that whenever they make a mistake in production, the patient is at risk, and this is very, very critical. And then we talk about innovation. Innovation must be sustainable, and I'm not talking about the environmental sustainability only. I'm talking about the economical sustainability, the healthcare sustainability, and I'm not talking about products only i 'm talking about processes, i 'm talking about any type of innovation that can help the company to grow. And of course, the teamwork b ut I think in a family culture company, the teamwork is really important and is a given. Bottom-up approach is something as well that we've been using for many, many years. It means we tend to hire young employees, and they grow within the organization. I would say 80%-90% of the time, that's the strategy, and this helps a lot to preserve the culture and reduce the potential dilution of the DNA of Medacta while we grow so fast. I'm very happy and very pleased to present you as well, the extended leadership team. You met myself and Corrado many, many times, but you see in blue the number of years in Medacta and the number of years in orthopedics. So you see that many of those people have been many, many years in orthopedics, all of them. So it will be very unlikely for you to meet somebody that was selling shampoos a few months ago. And I'm not referring to any particular company. But this is very important because orthopedic is a very special segment, is a long-term view, is absolutely necessary just to develop a product, launch it, and see some money back. It's a five, six-year process i f you expect this to be shorter, you are very, very wrong. Relationship in the salespeople is very, very important. We know what it works, and we know what we should not do, and this is very important. And of course, we are very pleased and lucky to have a strong Board of Directors, despite the fact that, as you know, we have a strong majority w e prefer to have a majority in the board of independent directors as well. So with this type of culture, with this type of strategy, Medacta has been able to really create a profile which is unique. Because Medacta is probably one of the only company, at least in orthopedics, that is not only able to deliver very good growth, probably one of the highest, depending on the segment, definitely one of the highest organic, if not the highest. But at the same time, we always have protected profitability. If you look at the peers, this is not the case, and this is what we want to continue to do and what we believe we can continue to do, especially after having done what I call always the heavy lifting, because my opinion has been very, very challenging to go from zero to five hundred. It is going to be challenging, but definitely less to go from five hundred to the next mark, which will be one billion. So this growth rate, together with this level of profitability, we can discuss about the 50 basis points when you want, but this is quite unique and quite remarkable. Not only with this culture, we have in our opinion a very good performance in the business. We think we have a very good performance when it comes to sustainability and ESG. And I think it is relevant for us to stress that we do ESG in areas that we feel are relevant. So the greenwashing, the looking good is really not our style. For those that have been here with us today, you have seen, for example, what we've been building since 2011, long before ESG was even frankly a fact, with our school, with our foundation. What we do for our people, which is, of course, linked to the efforts we do within our foundation a nd I would say on the environmental side, we are not a very polluting company to begin with. We do what we can to further reduce our CO2 emission. You have seen as well how much of waste in production is recycled systematically, and this is just done because it's good, and it's good for the economy, it's good for the planet, and it makes sense. Last aspect on the foundation for those that were not with us today, there are basically three areas where Medacta for Life is active, o80 ne is the My School Ticino, which is something that started as a nursery for our employees. Immediately, was open to the commUNiD, and now it's a school with more than two hundred kids, including the elementary school, around 80 employees, basically attached to our historical headquarters in Castel San Pietro. The other two aspects of the foundation are My Mission and My Giving. The My Mission is associated with orthopedic activities in underserved areas. This is something we typically do in collaboration with other foundation or surgeons organization that require us instrument implants logistic support people know-how and we do it on a regular basis t here's a lot of details in our Medacta for Life Foundation. And then the My Giving is more in the area of the charitable activities mainly focused on the needs in Ticino which you will be surprised to see they are quite high especially when it comes to youth-related problems and immigration. This resulted, as well, in good rates within the different rating companies, and this is something we do again, because we believe is right, and this is gonna be very unlikely that we do things in order to look good w e do things because we want to be good. Thank you very much. Any specific question on this slide? Otherwise, I will continue on techniques, products, and technologies. [crosstalk] It's good? Yep. I'm very worried I'm gonna choke. Got you. So at the end, we're selling products, right? So we can be very, very good people, but do we do good products? We mentioned, this is the most important for us. What did we generate by doing this approach in the past? What are we generating today in terms of products, in terms of technologies? We mentioned two areas, so minimally invasive solutions and personalized solutions. Those are the two aspects. How relevant those are for Medacta? A couple of examples. Hips. 80% of our hips are implanted through anterior minimally invasive surgery. Personalized solutions. 40% of all our implants are going through the MySolutions Ecosystem worldwide t here are some markets like Australia, where this is probably 80%? 80%. So very much technology-driven. And, it's not to talk about technologies that are not then utilized. This is relevant, this is driving our growth, this is driving our growth across all the business lines and most of the markets s o this is very, very important. So we're talking about things which are directly impacting our, top line growth and our ability to gain market share at the rate we are growing. Without innovation, without meaningful innovation, you cannot grow at this, at this rate. We have very good competitors, very solid, very large, with deep pockets, so you needed to have special products. This is what the MySolutions ecosystem looks like in a nutshell. So thousands and thousands of patients every month send us their CT scans or MRI or X-ray. We collect it here. We do a personalized planning for their spine, for their shoulder, for their knee, for their hip, in order to optimize outside of the surgery, what will be done for them in the surgery. 40% of our implants are done with this technique. Then this planning, personalized planning, needs to be executed on patients. How it can be translated, cuts are being done according to the plan that you have done on a 3D. There are different technologies. You can use NextAR, for those that have been playing with the glasses, y ou see the planning, you do the cuts, you put a screw in a certain direction. You are guided during the surgery in order to achieve this personalized planning. You can do it with NextAR, you can do it with some special software on the hip, using some X-ray machines as well, that help the surgeon to understand where he is compared to where he wants to be. You can use those 3D printed guides. Some of them you have seen, some of you have seen those guides in production in Castel San Pietro s o you basically have some guides that fit the bone of the patient, have some slots where you can cut the bone according to your preoperative planning. Is this a good way to execute a planning? Absolutely i t's super efficient, very cost effective, and it is one of the reason why we have such a good success and growth rate in the market. What else have we been developing? So anterior approach. anterior approach is something that put Medacta on the map 20 years ago. Before anterior approach, Medacta was basically trying to understand what needed to be done in orthopedics in order to survive. We were not even 20 million dollar company. The anterior approach, we basically identified a methodology where you could implant a hip stem without cutting muscles. Were we the first? No, we were actually the last, but we were the first to put together a package, an ecosystem, that allowed surgeon to get from one provider, Medacta, everything he needed: the right implant, the right instruments, the right leg positioner, the medical education, the support. This ecosystem is still driving our sales today. Many markets are still demanding learning center and cadaver labs. It's systematic o f course, we now go into a younger surgeon population, universities in certain markets, like the U.K., is just starting now. And of course, when we talk about minimally invasive, all the trends toward ambulatory surgery center require those kind of solutions, so there is a boost for minimally invasive solution t his is the reason why recently. On top of the 20 years experience with Medacta on anterior approach, we have increased to other minimally invasive hip approach, our offering. Because after 20 years, the market crystallized quite a bit between those that have tried anterior approach, maybe with competitors, maybe they were not well supported, they didn't like it, and they stick to something else. We have just launched, six months ago, different approach solution, different instrumentation, different implant combination, to address some of the segment of the market that decided not to move to anterior approach. This is very important because we're gonna be able to attack systematically, basically the rest of the hip market that we almost neglected, for the last 20 years. Another aspect which is important is the revision aspect of the hip. This was a segment where Medacta started to invest, four, five years ago. Now, we really have a complete product portfolio. For those which followed us during the IPO, hip revision was starting at that time. Now, it's really complete. We really start to have traction, and we can compete head-to-head, which means we can become the partner on the hip. In the past, Medacta was mainly a primary, so anterior approach, the easy cases, or let's say the primary cases, and then the hospital had to work maybe with Zimmer, with Stryker, with Johnson, in order to cover the revision. Now, we can be a sole vendor solution, and this change the profile and credibility as well of the company, together with the fact that the revision, despite the fact it carries some investment, it does carry some significant margins as well. So it is much less under pressure than the primary. That's on the hip side what we're doing. We can maybe further touch on some of the technology aspect on the hip side as well later, but that is basically what we are going to focus on moving forward on top of the anterior approach. The knee. The knee, you have seen really an explosion, and I'm very, very happy and very proud of what we are doing, especially because this was somehow, especially during the IPO, criticized y eah, maybe Medacta will sell some knees because it was successful in hips. Today, we have a solution that, once again, addresses the most important aspect, and the most important aspect is patient satisfaction in knees. I think if you talk with anybody, it's okay to have a hip replaced. The trust is good, it's fast, it's good recovery, and maybe then you know somebody that did a knee and he's okay. Maybe he doesn't have pain anymore, but he stops to play any sport, walking is a little bit average. So there was clearly an unmet clinical need in knees, and this is known to the surgeons that knee patients are never as happy as hip patients. This is known, there's no discussion y ou can talk about is it 10%, 20%, 30%? We can discuss it, but there is a clear gap between knee patient satisfaction and hip patient satisfaction until today. But let's understand why there were many problems. Number one problem, in my opinion, was how the knees were approached. So we know there are different anatomies. You have people with straight leg, you have people with round legs, like the soccer player, y ou have other people with their knees rubbing together. Those are all physiological ways i mean, you were born like this, you're happy like this. Unless you have a pathology which is very rare, that's the way you are, which means your ligaments around your knees are like this, your balance in the pelvis is like this t hat's pretty normal. In the past, 100% of the patient population would go out from surgery with a straight leg, which means you completely change your balance, you completely change your ligaments around your knee, you completely change the perception of your leg, which brings to dissatisfaction. So what we have been doing is to completely change the approach and introduce this kinematic alignment, which basically has the goal, very simple definition, to bring your knee back to the healthy condition when you were 30, okay? So that is as simple as I can give you the explanation of kinematic alignment. So if you were like this, you stay like this. If you were with slightly valgus knees, which are touching together, you stay like this, and we respect your physiology. Now, how you do it? Because, you have maybe a deformity, you are in pain s o how you can establish, how you were twenty years ago or 30 years ago, and that is the methodology of kinematic alignment. But let's wait for a second, maybe on the methodology of kinematic alignment b asically, what we did come up with surgeons is a methodology that estimates the wear rate of cartilage t here are a lot of papers, a lot of literature. And then basically, instead of doing a cut, which is straight leg, you respect the obliquity of the joint line of every single patient, which means every single patient will have a different cut, depending on how he was 20 years ago or 30 years ago t hat's the kinematic alignment. What matters is that now we start to have more and more studies showing that the patient satisfaction changes a lot, okay? This is, at the end, what we care about. If we do it, it looks good, but the patients, they do the same, it doesn't really matter, and so what did we do? We did develop, again, an ecosystem, because when you have something disruptive, you can create around this, this new technology and new techniques, an ecosystem which starts from a technique, special instruments, special technologies, special education, and most important, Medacta being the first doing that, a very specific implant, which is called GMK SpheriKA. Which is something we have been developing for the last six years, implanting for more than three, and is basically a modification of another implant we have been selling very successfully for many years, which was called Sphere s o we fine-tuned an implant, a technique, a technology, in order to really help the surgeon that is not familiar with this technique, to embrace this technique and move forward with it in a very safe and effective way when it comes to patient satisfaction. Is it new? No. Everything moves very slowly in orthopedics, so... We started in 2015. We started by doing CT scans, studying the planning for these specific patients, doing the cuts t hose were the very first cases. Then we released a dedicated platform in 2017 because we could see some advantages. Then we developed a special technique in 2018. This was all kept somehow in a very closed group of surgeons, 'cause once again, before you change the market, you really want to make sure that you're doing a step forward and not three step backward. 2021, we introduced kinematic alignment to the market. 2023, we launched GMK SpheriKA. So this gives you an idea of the progression of steps. What do we have today as a result is that more than half of our knees in the first semester have been implanted using kinematic alignment, and this is, I would say, 95% of our growth. So we are cannibalizing our own customers by moving them to the, to this new technique, but the vast majority are new customers jumping on board because the story is compelling, it makes sense, and they see it. What is different compared to anterior approach, and what is different, in my opinion, in terms of effect on the market, is that we started with one single surgeon with a disruptive idea in UC Davis, California. This surgeon started to work with Stryker twenty years ago. They didn't believe him, dropped him. Then he moved to Zimmer Biomet. He was doing more than 600 joints per year, so they were saying, "Yeah, you're great. Come use our implants," and then they were stopping. Then he moved to Johnson & Johnson. So once again, were we the first? No, we were actually the last. We were probably the last hope for him as well h e was very happy now. And we did our homework with him, and then we did identify some early adopters around the world, in the U.S., in Europe. And what changed completely compared to anterior approach is that relatively early, we had the chance to have on board some very high-profile academic members, and this changed the picture completely. Because if they say, "Yeah, it's actually not so crazy, it's actually good, I see it in my patient, it makes sense" t hey do studies, they do independent studies, they validate what this guy has been publishing for 20 years, Professor Howell, then you really create a big wave, and this is what we are riding today, because especially the young surgeons, for them, it makes so much more sense to do what we're doing t hat is, it's abnormal for them not to do it, because it's weird why everybody should be straight and change the ligaments, and of course, they're not happy. This is very, very important. May I tell you or suggest to you that, the same happened for the AMIS, for the hip. We have been the last ones, but before us, many other multinational companies were contacted by the people, by the French surgeon who invented the AMIS. Lo. Lo. Hello. Yeah, but before him, there was another one. The one who invented the technique. J&J, and all the multinational companies didn't follow, and we did. It's the same, same route. Yeah, but you will see that this pattern of betting on things that are more risky. I think you can do it if you have a better understanding of the market potential rather than the market size. And this is, of course, by definition, if you are a manager, not from the space, you're much, much more reluctant into going into certain directions i would say that the biggest bet I've seen outside of Medacta, which paid out, was Lobo's bet on Mako t hat's quite unique, for example. So this is more or less similar. Spaces that exist, been neglected, and then we jump in, we expand it, and now everybody tries to say that, "Yeah, it doesn't look crazy anymore." But what matters the most is that we truly see a change in patient satisfaction. And so today, the combination of this technique with our technology, and especially with our implants, really brings to patient satisfaction, which are extremely high. So high that they are incredible i mean, to jump on those things at 84-year-old is very, very unique. This is a guy, maybe you have seen it downstairs with a red jacket with Medacta t his is a patient with a total knee that climbed an 8,000-meter Himalayan mountain. Climbing is not very difficult with a total knee. Descending is a disaster. So remember this, because descending means you need to have a stable knee, and stability is one of the key of the success of this procedure, and this is very important. Dr. Klassen is another fantastic example. I think he has been one of the most loyal Biomet customer for 40 years h e's very close to Warsaw, Indiana, but when it did come time for his knee, he got the Medacta Knee kinematic alignment. And now he's of course a happy patient, but as well a happy customer as well. But let's go back to data. So this is not yet published i t's been submitted to the next Hip and Knee Society meeting in the U.S. For the first time, we have a study showing that knee patient satisfaction at one year and two years is similar to hip patient satisfaction, anterior approach. So not only hip, it's anterior approach hip. This is going to be one of those pivotal studies that will change forever the fact that you cannot say anymore that hip and knees have a gap i t depends what you do with knees. And this is, in my opinion, very, very critical. Let me try to share a little bit with you what it means, stability c an we play those videos? Can I... do I have to do it, or? I can do it i click. Fantastic. So that's a natural knee. You see the, the patella, the-- basically, the, the knee doesn't move forward when you flex it, is a stable knee t hat's how it is when you have the cruciate ligaments, when you have a healthy knee. Then you put an implant. When you put an implant, you have to cut the cruciate ligament, the anterior cruciate ligament, and most of the time, the standard implants, especially those from competition, they have this behavior. Look, you see how much movement you have anterior and posterior, which means that the, your patella, which is here, the kneecap, is absorbing all the shock. Which of course, by definition, you have a swollen knee and you have pain. As simple as this. And this is what happens when you put a Spherical knee with this special design in combination with a technique that provides the right ligament elongation, because those are your physiological ligaments t his is basically an explanation, and I hope I managed to give you an idea of what does it mean, a stable versus an unstable knee, and why this translates into patient dissatisfaction y ou basically don't feel stable, you need to hold the rail, you need a stick, especially when you descend. And if you don't do it, you have to put a big brace, w hen you have an ACL rupture, it's the same, or then you have a swollen knee. So these are all the complications after total knees that are addressed completely by a combination of knee implant and technique. Did we do just some videos with fake bones? No, we did quite a lot of good studies. This is an example of how the knee moves in a healthy young patient. This is a moving fluoroscopy machine that takes X-rays of patients walking in different scenarios, t his is a study we have done at ETH Zurich w e've done another one in the U.S. and another one in Australia, just to have correlation t hen you see in vivo what I was explaining to you. So you see that there is some slack on this prosthesis w hen you walk, the femur moves forward, which is unnatural and lowers the patella, and then on the other side, you have a stable knee, and this translates directly into patient satisfaction. Those are the arguments and the data that we are providing over and over, and are becoming compelling stories that makes our product really unique and standing out, which explains hopefully why we do have such an explosion in knees. That's a very good story, with good data, with good opinion leaders behind, now convinced, and in our opinion, there is a wave coming. Competition will wake up for sure, but until they will not change their implant, we will have a window of opportUNiD in front of us. They will change their implant i t will take several years for sure. Shoulder is another very, very successful big success story for Medacta. It is a platform that basically started five, six years ago from scratch. We were very late into the market with the shoulder. This of course created some disadvantages, but as well, some opportunities. When you are late, what do you do? You study what is the best out there. We picked some of the best designs of different solutions, of different shoulders, different platforms from our competitors, and we put them into one platform, very modular w e can cover all the possible needs of a surgeon. Instrumentation is optimized, compact, and on top of that, we provided for those that have been visiting our 3D printing, some custom solution as well s o we can cover from the beginning, everything in the shoulder, from simple to super complex procedures. Once again, we started with a very strong support from key opinion leaders worldwide, and now, in a very few years, we managed to reach a very significant market share in Switzerland w e are number one in Switzerland in less than five years. We are number two in Belgium, number one in Austria. So just to show how good and competitive is the product, and on top of the implant per se, which is very, very relevant, what we added was, of course, the NextAR portion of the mix, if you want. With NextAR, Medacta has been uniquely positioned to provide, I would say, one of the two surgical guidance available in the market. None of the big ones used to have it. Now, the only one that is coming out with some surgical guidance, I would say, still technically inferior to what we are providing is Stryker, with the new Blueprint, augmented reality as well, by the way. They're still lagging in terms of some functionalities and some aspects, but this is another aspect why Medacta has been able to take market share and will most likely continue to take market share moving forward in this segment. We can take a leading position in certain market, Product-wise, we are second to none, and then the rest is just distribution. NextAR. NextAR, what is important for you, we talk about it in the knees, we talked about it a little bit on the shoulder, on the spine. It is a platform technology. It is a platform that is completely different from what is out there. We talked about it five years ago during the IPO. Where is it today? I think it is definitely a success factor for our growth in shoulder, for sure. I would say probably is the single most important element of our shoulder offering. Definitely a very important key driver for our spine. Significant for sure in knees, although with our technology, kinematic alignment is not 100% required. So it is definitely something we are very happy to have, and we continue to invest in. As a platform technology, there are some additional applications that are coming in on the hip side, on the unicompartmental side. Depending on the regions, depending on the regulatory aspect, those products will be available in basically next year. But when you have a platform technology that helps you to attack the technology segment, you can answer to needs of surgeons that do have a matching technology need in a very, very efficient way. Because if you compare the capital investment that is required for NextAR to a robotic solution, or the workflow and the complexity associated with it, and the fact that you can do all of this with a single-use solution, back to the CapEx and back to what's going on in the market, you have a completely different offering. When we go and we see a surgeon, that's basically what we bring. So that's our NextAR. So it gives immediately an impression of how different it is. Some glasses, you have your tracking system, all single use, and you have a screen. That's basically what NextAR is. So in terms of footprint, can you imagine if you go into an ASC, if you serve the Japanese market, which is almost 100% shipping back and forward, you cannot serve it with big, large capital equipment s o you have a significant edge there. Which is something we are really appreciating, and it is really part of our success. Again, when we talk about footprint, that's what we compete with at the moment, and I would say we are very happy with what we can do and what we are achieving. Does this mean we will never ever have a robot? We started THINK Surgical as a partnership. There will be other opportunities. I would say yes, if we can find a good solution that limits the imbalance between patient outcome and cost, which is today not fully justified or... So we want to stick with this solution. We have new applications coming. We mentioned spine. Spine is a very, very important aspect where surgical navigation is critical. For those not familiar, you have a spine like this. It's called scoliosis. You have to fix it and straighten it. In order to do it, you put screws all around the vertebrae. In order to put those screws in a good way is good if you have some surgical guidance, so you make sure you are in the bone and not somewhere else. And then you have to basically select a rod, a metal rod, that allows the surgeon to straighten the spine in this plane and still keep a curvature of the back, which is called lordosis and kyphosis. Sorry. So this is what we do with NextAR in spine. Now, we announced it, I think today, we just won the Spine Technology Award, 2024, with a new module of NextAR, which is called NextAR Rod Optimizer, which is something very unique, patented, as I mentioned to you before, and in my opinion, very smart, because it does provide personalization, basically without adding the complexity of custom solution. The only solution out there, which is providing something similar to that, is Medtronic, with fully custom solution i t's called UNiD. Which very high cost, very high waiting time, very little intraoperative flexibility. With the NextAR Rod Optimizer, and this is something you can play with later, you can basically touch the head of those screws in the spine, and the software will help you to identify out of a limited number of rods that we have prepared, which is the rod that best fit your need for that specific patient. You cut it, and you put it in. Which means you can save one very important aspect of a spine procedure, which is very long and very dangerous as well, risky, is bending the rod by hand. The surgeons today, standard of care, is they bend those metal rods in order to fit the curvature of patients by hand, and this translates into risk of breakages, risk of pulling on screws on the bone, risk of not achieving the correction you want. This is a very unique product. This alone, in my opinion, could lead the way in spine in the U.S., for example, for a good amount of time, and we have just introduced it a few months ago. But this is, once again, a unique product, and what I would like to share with you is that over the years, we have been constantly able to develop products, implants, technologies that have been completely different from competition t hen, of course, competition is always there, so you always have to continue to develop those new products, otherwise you cannot compete anymore. But what, in my opinion, you should see in Medacta is a company that has been able to innovate in the past and continue to be able to innovate moving forward. Thank you very much. We're late or we're good? Please. There will be no coffee. They told me it'd be long. Maybe just one question just on what we haven't discussed, so which is the sports med side. Maybe without sort of lifting too much of your thinking, where do you think the bigger opportunities are in, you know, arthroscopic technologies or other sports med approaches? Arthroscopic technology anchors. There are unmet clinical needs that we think we can tackle shortly. That's definitely an area where we are very keen to come up with some very, very good disruptive solutions, both shoulder and knees, foot and ankle, I mean, in the soft tissue or a fixation. Yeah. Thanks. Thank you. Maybe you can also share some thoughts on the latest trends in education events. Have you mainly invested in events in the knee segment or also accelerated in the hip segment? And then also, again, on innovation, Corrado highlighted the healthy balance sheet you also have, but you have many exciting products in the pipeline. But do you also consider some inorganic innovations to be added to the product portfolio, or is that out of discussion at this point? So we will have a session on education, but short answer is we did maybe focus a little bit more on the knee, but we still have a very significant education effort across all the lines. We will have a session after the break. Concerning the second question, which was, again, sorry? Innovation and potential for inorganic innovation. Yeah. Inorganic innovation is always there as well y ou don't see it because those are small acquisitions, maybe patent acquisition or a license acquisition, but we do it very often. Yeah, it doesn't mean we acquire a big company because they have one product. Yeah. So we're looking at all of the innovation across the business, you know, your R&D spend as a percentage of sales isn't that high relative to other businesses in the med tech space i suppose, what do you think the sort of two or three key factors in controlling the R&D spend have been historically? And are you ever tempted to use balance sheet to ramp up the R&D spend, to try and go sort of faster and launch more products at the same time? Yeah. So we have around 5% between cost, R&D expense and capitalized. I think what is critical in the R&D is what you do with that money. So with Max, who will speak with you later today, we've been doing this for 35 years. So when we define that this is important, needs to be done, we do it. We do it in a very efficient way. We maybe stop other things, and that's what we run, and we run it super efficiently. We are all engineers here, so this maybe helps as well to identify what we want to do. But it's not unusual, I would say, if you take all the major companies, if you look where the innovation is coming from, it's typically acquired by smaller companies which are much smaller than Medacta. Mako is a good example. I mean, it was not a billion-dollar company, Mako. And that's the most complex technology you could develop. Mm-hmm. Hi, just one question from me. Today, of your NextAR install base or users, what is the most common, the mix of applications between, I don't know, a knee and shoulder? And where do you see this mix trending over the next three to four... i.e., which of your segments is going to be most influenced by the adoption of the NextAR? Shoulder, I would say, is a percentage of cases done with NextAR is probably shoulder, then spine and knees, more or less similar. But, we do have both in knees and in spine with the NextAR Rod Optimizer, some very significant expectation to accelerate. Yeah. A quick question on robotics. I think you've made very clear that given the successful outcomes of hip and knees, really, you don't need robotics. But the surgeons very often want technology in the operating theaters. With the glasses, you're offering them some technology. What would it take to add a low-cost robotics to the offering? Is that it's something you have to acquire, and are there techniques out there that would help improve outcome or give the surgeon something that would substitute for the expensive options that they now have? In other words, do you need to be in robotics, or can you get away with not being there and just with the glasses? ... I think we can get away without being robotic, but it's not something we are not contemplating, and we think we can do better than what is out there, at least in terms of economics. The problem is that the current technologies, if it comes to NextAR, especially knees, did not really change the results. So whatever you add in terms of cost is not justified. But the marketing side is needed, so I think today is probably easier for us to have a robot down the road. That's why I think surgical partnership is very welcome than not have it. it. Then, if the surgeon wants to use it, he will. We will We will use it. But it's not. So just for those which are not familiar, Medacta had a robot in 2006, internally developed. We were a $30 million company, so to develop a robot. Actually, this guy developed it, so we still have the guy. So it can be done. It's not something we don't want to do w e are exploring different solution, w e can do it, w e can do it internally. It's not an acquisition. We can do it in partnership. It's definitely something we continue to explore. Please, the microphone. Thanks. The uptake of GMK's SpheriKA, is that regionally very different? I mean, I guess Australia, you mentioned, a very technology-driven market, or, I mean, you see difference in your big markets? Yeah, it's geographically different because of regulatory aspect. But- For example, in Australia, it's not approved, so we are still in a clinical study phase in Australia. It will be approved and will be released. But, we gave some priority to the US because that's where they had clear first clearance, then Europe and, probably Australia. Japan will be next, and then Australia, roughly. But the American surgeons are probably more risky and try it out, versus, let's say, the Germans, or is that that doesn't matter if there is a clinical- I would say we are not risk takers, so we... We kept this implant for over three years in a very limited number of centers, so when we go out, we go out with data. We could have launched it three years ago, but we never do that. But I met the surgeons, because I know it from other medical indications, that Germans typically wait until the whole world adapts, while the Americans are probably- Yeah, I would say there is a certain level of culture, but there is always the usual product introduction phase, so you have the pioneers, the early adopters, and given the fact that our market share is so limited, you always find enough of those surgeons in the early phase. Now, I think the early phase has passed. As I showed to you, 2015, that's when we started. So the implant per se is an adaptation of something else that has 15 years of clinical data, and so the risk associated with change of that implant is low. Low, very low. Last question on the... You mentioned the hip and knee size, for it is combined. Wouldn't it make sense to separate it? It's the same customer most of the time. It's the same surgeon? Yeah. So it's- Most of the time, the surgeon that does hip and knees, he does hip, knees, hip, knees, hip, knees, in order to optimize the instruments' usage. Even in the big centers? In the vast majority of the centers, yes. Okay. It's more the exception that the hip guy is doing everything around hips. So if you separate, you will have a problem in the service, for example. Oh, okay. It's very typical. I don't know any company that has hip sales force and knee sales force. May I... Sorry. About the risk of the product, you probably know that Johnson & Johnson is paying billion dollars for the claims of the patients who have been operated in metal on metal. They didn't wait enough to see the result of the operation, you see? And the risk should be a little bit covered by waiting, waiting, waiting. That's a patient approach. I'm not joking. I mean, as of course, it plays very well on the company side, because if you make a mistake, it's an expensive one. Yeah. I mean, everybody sort of, or not everybody, but most people talk about robotics, and the thing about it is more precision, preciseness in procedures and mitigating risks. I mean, the other aspect, of course, is the cost. So robotic, I would assume, is quite costly, so compared to with your NextAR, is probably much more efficient in terms of cost. Can you share with us? sort of how you see it, the risk-benefit or the view of the market, costs versus more precision and using robotics? Sort of what are the developments sort of going forward? Thank you. Yeah. The problem is that precision has not been linked to patient satisfaction or reduced revision rates. That is the biggest problem s o yes, you can be more precise, but first of all, as you noticed, we didn't know what was good in terms of positioning, so you were precisely positioning the implant in the wrong spot. That was what everybody was doing. Okay? So if you don't know what is ideal for you, you can be very precise, but then you don't see any advantage patient-wise. So after 10 years and billions of dollars spent in technologies, including NextAR, there is not a single paper showing significant advantages in terms of revision rates or clinical benefits. Very, very limited. So you have to create some studies or some scores in order to measure some differences, which are not sort of p robably because the problems we were seeing in knees associated with instability, associated with technique, with implant design, were so much bigger than one degree of precision would not change. So that is the biggest problem why I struggle to justify a significant expense in robots w hy they do it? Because the marketing side of it is fantastic. So Stryker has done a fantastic job in selling robots to the hospitals to attract patients so that the surgeon would have an increased volume. So it works extremely well, but under an economical point of view, under a clinical point of view, it's much more challenging. I think, if you, if you speak with a robotic expert, he will tell you, "But at the end, did you see a difference in patient outcome? No." And this is how we lead our discussion when we go in with our offering. Yeah, it's fantastic, but do you see clinical improvement? We do see it. That's how. And then they switch. We switched quite a bit of robotic users as well, because the clinical s o the. It would be fantastic if you can have an efficient execution. You've seen how many robots, right? We love robots in production. They bring costs down, they're efficient, they are reproducible. And I think we should come up with a similar solution in orthopedics. So you would rank it basically patient outcome, mitigating risks, more precision, and then cost? Would that be sort of the right ranking? Yeah, I would say so. Or the At least if you increase the cost, you should increase or decrease the risk significantly, which is not there. [crosstalk] Coffee? Coffee break. Coffee break, a quick one. That is, we are a little bit late on our schedule, but it is time for a coffee. It must be quick because rain is coming, so let's. I will not stop.... ... Hey, I think we are ready. The rain rang the bell for me. So here we are, ready for the second session w e will try to recover some delay we got. Yeah. So next session, we will go over innovation with our Chief Innovation Officer, Massimiliano Bernardoni. We'll then cover education with Gianluca Olgiati, Head of Marketing. We're gonna then move to the commercial operations with Niccolò Galli, Chief Commercial Officer, and we conclude with my brother, Alessandro, Head of Supply Chain. So floor is yours, Mas. Thank you. Thank you. I was also hugged before, you just didn't see it, but I was considered as well. It's working? Yes. So thank you. So I am Massimiliano Bernardoni, I'm the Chief Innovation Officer of Medacta. I will speak about innovation. So Medacta is a strong engineering company, and on top of the R&D, of course, the CEO and the marketing salespeople are very often engineers with a long career in Medacta. And maybe this is the reason why innovation for us is our shining diamond, and since the origin of the company, it has been one of the key factor of our success. As Francesco was saying, the two main pillars of our responsible innovation are patient well-being and healthcare sustainability. And for this reason, through our innovation, we have been pioneer in offering with a very efficient execution and supported very well by our medical education, new minimally invasive surgery approaches, and personalized solution for the patient. For us, the final goal was, and remain the same: improve the patient recovery, reduce the rehabilitation time, and finally, improve the clinical outcome in a way that remain sustainable for the healthcare system. In one word, we want to create some value, and this is something that, being in the company since 24 years, it happened to us more than once. Our innovation is driven by a very close relationship with surgeon. It is important, it's fundamental to understand the patient needs, and to be able to design solution that can really address the unmet clinical challenges. To deliver, we can count on R&D, on our R&D expertise. Medacta, as we said, is an R&D company, and we have always invested time and resources in internal training our young engineer. Today, we can say that our R&D team is an expression, really, of our culture and our value. For me, it represent a real differentiator, able to bring innovation to the market in a quick, effective, and responsible way. The adoption of cutting-edge technology, such as material technology, probably you have seen this morning, the laser 3D printing, for example, augmented reality, artificial intelligence, help us, of course, constantly improve our product and our offer. But the real differentiator that we have is that we are developing internally all our product, and this fact contribute to the expansion of our own know-how. So we are really in control of our know-how. And very often, we are faster and more proactive than our competitors in developing solution, and find the right solution and the right things to do, because we have a direct and full control of our internal development activities . Just to give you some numbers, from the project opening, so from when we have an idea to when we start the limited market release phase, so we are giving the product to a selected number of surgeon, we usually take from 2-4 years. And this is quite fast, if you compare to the competitors. And what is also extraordinary, I think, is the percentage of project that we can close, having a product in our hand, that is around 95% of the time, and this is an average that we had in the last 24 years. Of course, to be innovative and impactful, we have to find a selected surgeon with a disruptive innovation ideas and work with them. We have to work with them in collaboration with a wider commUNiD of key opinion leader, part of our M.O.R.E. network, to build essential input of our design work. But what we have to be really good is in selecting the surgeon with disruptive innovation ideas. And so far, we have been quite successful in selecting the surgeon. Many times, at least three times, as Francesco was saying, Dr. Laude with anterior approach on the hip, Professor Freeman, that bring us the idea of having a knee that was a ball and socket for stability, and Professor Howell, that he was the inventor of the kinematic alignment that we coupled together with the Sphere knee, becoming the spherical. Two other important aspects of the improvement of our product are linked to, of course, strategic collaboration with universities. We cannot do basic research on our own, so when we have a need, we have a good relationship with many universities. And last but not least, one of the most important sources of information that we have today is the MyBody database. And this is the database that we create internally in the company, collecting all the CT scans and MRIs of the patients that we operate to a personalized medicine solution. And this database is constantly growing with 50,000 new clinical cases every year. And this database, you are not an engineer, but you can imagine that with this database, we can do a lot of investigation, a lot of measurement, and this was the basis of our anthropometric study, that, for example, helped us in designing the spherical knee. We were speaking about robotics, so we are saying Medacta has no robotic because we don't believe in robotics a ctually, one of the last development that we have done is the AMIS robotic leg positioner, so is a robot. And I would like to say that is one of the, the last example of a very profitable collaboration with a leading surgeon in France, and the surgeon is always the same, is Frédéric Laude, the genius that bring us the anterior approach. The idea, the disruptive idea that we had when we were discussing about this opportUNiD, was to try to reduce the number of assistant needed in the operating theater during a total hip arthroplasty. Of course, we needed to have the surgeon always in full control of the position of the leg of the patient, but the idea was to try to reduce the personnel during the surgery. This is a very good example of efficiency, where the footprint of a robotic solution has been well-balanced with the reduction in cost for the personnel attending the surgery. We are not against robotics w e just have to select when a robotics makes sense.... I don't know if you have seen it, but today, in the morning, we have this robot in the entrance of Medacta. We were saying that personalized medicine is, of course, an important and predominant aspect of our offer. To be able to deliver personalized offer for almost 50,000 clinical case in a year, we have been obliged to create what we call the MySolutions Personalized Ecosystem. That is a very captive offer for our client, and usually when we serve our surgeon with this offer, they are so used to get this service, that really they stay, and they like to continue the collaboration with Medacta. How it works? It works that starting with a very comprehensive and advanced implant portfolio, we can use our own tool that we develop internally to provide, as Francesco was saying already, a 3D planning for the patient. The surgeon has not to think too much w e provide this service for him. He has to check the planning. He is the surgeon, we are the engineers. He can modify the planning very easily, and then he can validate the planning. But once the planning is validated, we can share with him the essential information to secure and optimize the surgery. And then it's just question of translating this planning into the surgery, to execute the surgery. And of course, we have different solution that, we have finalized with the time. And, to execute, for example, they can use the NextAR platform, or they can use the MySolutions cutting block. Post-operative data collection are very, very important s o once you have done and execute the surgery, we have the possibility to collect the data. And, we have two option, We have the MyClinical data and POP Hub, that is, the Patient Optimized Pathway hub, that are essential to verify the quality of the clinical outcome. And furthermore, all this data, so the big data collection and stratification of data, are the best foundation for the development of AI-based predictive solution that we have already in pipeline. So AI, of course, will be part of our future, and this data will help us to try to predict the clinical outcome of an execution surgery s o we will be able, probably, to develop the third generation of 3D planning, where we will have some prediction of the clinical outcome through the planning. Just to conclude, I would say that innovation is not only about where we are doing now, but is more about what we will do next. This is clear. Innovation is a constant process, aim of improving the future, and we believe in it, and it will be constantly linked to our success. So until today, Medacta has been successful because of our innovation. We will continue to do innovation because we want to continue to be successful on the market. Thank you. Question. Question. No question? Okay, keep going. So thank you, Mas. Good afternoon, everyone. My name is Gianluca Olgiati. I've been with Medacta for twenty years. I started my career with Max in the research and development department, and then I had the privilege to work with Niccolò as area director for the European market, and today I'm serving as a group vice president for marketing w ithin my responsibility. One of my key focus is the development of our educational platform, both in terms of strategy and execution. Today, I would like to share with you how education is a key success factor for Medacta since the beginning, and will continue to be a key success factor with many other. Innovation requires education has been our mantra for many years, so since the beginning, as you have seen in the presentation in the previous section. The constant process of innovation presented by Mas in the previous presentation requires a solid and, most important, scalable education infrastructure to serve the expansion, the growth, the new market, the new product introduction. That's why medical education has been a key differentiating factor for 20 years. "The surgeon is never alone" is our motto, and reflect our value of patient and customer focus t his is something we have expanded a lot today about our focus on patient well-being. Education is a key pillar of our basic strategy, but is also the most effective way to support the new adopter worldwide. We founded the M.O.R.E. Institute in 2004-... Still developing the platform. M.O.R.E. Institute is a unique global education platform that is tailored to meet surgeon needs. Education is personalized, also in this case, all the services are personalized on surgeon needs. It's built on a unique, strong scientific commUNiD, that help to develop educational opportunities, build event, build scientific program, everything on a structured method. The structured method, that have proven to be successful, has a backbone of five simple steps. The first one is based on the availability of our expert surgeon, that are working at reference centers, that can be hospital, university, academic centers, and they are available to ask new surgeons, new adopters, that want to further understand about our product and about our technique. They have the possibility to evaluate the technique, and to explore the Medacta portfolio, just looking at what our experts are doing. If they are persuaded that the solutions they are seeing could bring benefit for their patient, there is the next step for them, that is, attend a learning center. A learning center is a workshop, is a kind of a workshop organized on real human specimen, where the surgeon, the new surgeon, can practice the technique and test the new product on a very safe environment. And then he has also the opportUNiD to have a scientific conversation with the expert, to deepen the knowledge, to go through the rationale behind our product, to get more insight about the clinical evidence that support our innovation, and this one, very important step t he third one is the key one. The proctoring. The proctoring is the key differentiator factor for Medacta. So I'm a new surgeon, I have a visit with an expert, I've been on a course, and then I'm ready to start, I'm ready to take off b ut how I wanted to take off? With confidence. So the surgeon that maybe is the one I've met in the previous step is available to come to visit my hospital, stay in the operating room on my side, and discuss s haring opinion, helping me to start with confidence i can ask him: "What would you do in this case? How to help?" And he gives also the opportUNiD to continue to evolve, to continue to learn and practice the technique in a safe, in a very safe environment. Just to create a comparison, it's like learning to drive a car. First, you see someone driving, and then someone bring you on a park space or in a very safe area when you start practicing with the clutch, with whatever, and then you start your lessons with someone on your, on your right i hope this has been the same for all of us i mean, at least it's been the same for me. But this give you an idea about how important is to have someone on your side while you are learning, to keep you on the safe spot, especially if you are driving a car in a parking, it's something. In operating room, there is a patient. And then from the third step on, everything is about advancing, evolving, learning, and creating the experience on maybe specific complex cases, unique pathologies, and becoming a master of the techniques, having the opportUNiD to interact with our network of experts. Talking about expert, actually, we have closer to 600 reference centers, and in 2023, we have been able to educate or to have in our educational activities, close to 3,000 surgeons, only in 2023, and we did organize more than 130 learning center. The educational offer can be further enriched, tailored with additional elements, that everything is based on surgeon availability, surgeon needs, surgeon preferences. We have many options b ut then it happens that surgeons, especially key opinion leader, are very busy and maybe they cannot attend one of our events due to the schedule. So if they cannot attend our event, we can bring the event to them. A very nice example, upon needs, we can activate mobile labs to give quick access to anyone interested in our product t his is very effective in United States. It's very easy to maneuver a truck, and inside you have a fully equipped lab, where you can run a kind of a workshop without any limitation. The only one is parking. That's an example. There are many other things that we can build upon needs, also activating one-to-one kind of a workshop on different facilities where we have quick access worldwide. One example on every other is Australia, where it's very common. The M.O.R.E. Institute also organize international symposia, where our expert can share the results of their clinical outcomes they are recording and registering and in 2024, the M.O.R.E. Institute also has been celebrating our 25th anniversary through education. So we did organize an initiative that we call the 25th Anniversary World Tour t he focus was, the results. And the sustainability of, personalized medicine that has been, let's say, the core of our innovation in the last year. We did organize four different symposia in different parts of the world. The last one will be next month in Japan, and due to the high demand, also to answer your previous question, we are replicating another date in the United States. Mainly focusing on the knee, due to the high demand on education around kinematic alignment, Spherica, and this very compelling topic. Talking about the Lugano event, the Swiss one, that has been, say, at home, we have been able to host 1,200 participants from worldwide, and 160 experts presented on stage for five days in a row of symposium. This has been a very big event. This has not been only about the scientific presentation. All the attendees have been able also to touch firsthand the new product coming, and we also had the opportUNiD to organize satellite events, leveraging the opportUNiD to have surgeons from overseas here, and satellite events like learning center, specifically organized for them. Reference center visit, education board meeting, 120 meetings done by the R&D in five days, and we had also the opportUNiD to host here in the headquarters, 150 surgeons. As a satellite event, we touch more than 500 participants coming from worldwide. Another activity we support are the fellowships and the clinical research project, in collaboration with the leading university, technology hubs, and center of excellence worldwide, but in practice, what is a fellowship? A fellowship is a specialized training program offered to young surgeon through an educational grant, giving them the opportUNiD to enhance their skill and knowledge with a short-term visit in one of our academic center t hat's the best way to support the promising surgeons candidate to become key opinion leader of tomorrow. Since now, up to now, we have organized more than 100 fellowship and clinical research project worldwide. Before we were talking about our ability to listen the need of surgeons s omething we learn over the years is that education is important for surgeon as it is important for patient. There is a very positive correlation between patient education, engagement in the care pathway, and satisfaction. Patient education plays a significant role in improving the clinical outcomes and increasing patient satisfaction. That's why we did create a specific program, called MyPractice, that offer to surgeons a unique package of educational material to support them in preparing their patient to be successfully part of their journey. Also in this case, we are offering personalized solutions, and we can build, I would say, education strategy upon the surgeon needs, based on his preference a lso, in this case, the material can be really customized. I've mentioned before, that one of the promise of the M.O.R.E. Institute is the surgeon is never alone, and this imply a daily 360-degree support. The surgeon is never alone, mean also being on his side on daily activity with highly qualified, well-trained, and continuously updated team. That's why we did create another internal department, that it's called Medacta Academy, that it's addressed to internal personnel, and only in 2023, we delivered close to 45,000 of education on training, on certifying personnel around the world. There are people also in today, downstairs, doing their three days training, and we hope that at the end of the training, they will fly back home with a full certification on product and technology. The vision I presented and the unique approach that has been built around patient focus, it's supporting the Medacta growth, the expansion, and the success since the beginning v ery short, my take-home message, start from the initial message: innovation requires education. Innovation, we see, is important. Relevant innovation is the answer to surgeon needs for improving patient outcomes in a sustainable way. The same, education is the answer to surgeons' need to adopt innovation safely, quickly, and, again, sustainably. Innovation-education cannot be effective if innovation is not relevant i can have the best education platform, but if I have nothing to teach, I'm quite useless. Paradoxically, there is the opposite. I can have the best innovation, but if I don't have a loudspeaker to spread what surgeons can achieve, it's not effective. The More Institute is trusted worldwide as a solid brand that delivers top-level, tailored education. The proven method I've presented, together with the global network of experts, allows for efficient scalability. That's another important point. With the More Institute, the surgeon is never alone, and the combination, innovation and education, supports the growth of the expansion of Medacta since the beginning. But on this topic, Niccolò will expand and elaborate in a while. In the meantime, thank you for your attention, and I'm happy to answer any question you may have. Gianluca, I don't know if I missed it, or could you kindly disclose how I mean, you need surgeons who will train new surgeons and who will be present. So how many surgeons do you contract or have you contracted to do these training sessions with other ones? That would be the first question I would have. ... in terms of number, the current number of surgeons that are supporting Medacta as expert surgeon is close to 600 people worldwide. Okay. I mean, of course, they won't do that for free, because the time they spend with you, they can't do surgeries and will be losing money in verbal commerce. Can you kindly share with us? I mean, I assume that all these expenses are booked under, you know, sales and marketing- Yes. How much, sort of, would that whole concept of education, training, academy, et cetera, sort of, does it make up from the SG&A expenses? Yes. I cannot disclose the details on this, but just to give you an idea, all the contracts are managed, let's say, with the compliance officer. There is a fair market value for each surgeon. The total account for education and marketing activities is in the range of 5%-10% of the top line yearly. [crosstalk] Five, not 10. Low five. 5%. But this includes all the medical education, so the consultancy, the cadaver labs, the travel and accommodation specific for those, the events. Of course, maybe mention 10%, because this year with the 25th anniversary, we had a little bit of a spike, not 10%. But this, the average in normal years is around 5%, which is something we communicated back as well in the IPO i t stays more or less in the same range. Thank you, Francesco, for the point. Other question? Okay, Nico. Thank you again. Thank you, Gianluca. Good afternoon again. I will give you a brief overview on our commercial operations and strategies, and I will try to be as fast and efficient as possible. First of all, you see here our geographical footprint. We are currently working in more than 60 countries all around the world, and these areas represent basically 90% of the total global orthopedic market in value. We are active in four product lines, hip and knees, which represent more than 80% of our revenue, followed by spine and extremities. Our business model, we are working with direct operations in 12 countries, key strategic countries. Elsewhere, we are collaborating with stocking distributors. And in fact, it all depends on the distribution channel. Currently, 90% of our turnover is generated through our direct sales. We directly sell through our branches to public and private hospitals, and we have the ability to establish strong relationships with surgeons through our solid innovation and high quality level of service. How the conversion process works. We divide each country in smaller territories w e set up a capillary network of direct sales in each territory, and then we select our target in each territory. We prioritize them, and then we start the conversion through the adoption of innovation, as Gianluca said, supported by our education platform. Sales process literally start by installing, at customer location, all the instrument and implants that we need, as we have seen earlier this afternoon. The surgeon buys constantly as the implants are used, and by transition to Medacta, they become loyal customers thanks to, again, our focus on innovation and medical education. This process takes a little bit of time, but you end up with loyal customers. Again, about the commercial model, what drives the decision? Basically, it makes sense to have direct operations, which requires you to make an initial investment to start in the countries where you have the higher level of prices. Again, elsewhere, we prefer to collaborate with stocking distributors who are gonna buy instruments and implants t hey become our customers, and they obviously are gonna take over the initial investment. That's the reason why Medacta is strategically positioned with direct operations in the largest market with favorable price levels. Particularly, we have been focusing on the Western European countries with relatively high level of prices. We developed a hybrid model in terms of the local sales network, mainly direct sales force, and only in a few countries, some commission agents. The price setting depends on, on the country, depends on the system w e have procurements, we have public tenders, we have, prices set by government, we have to deal with purchasing groups. In Asia Pacific, our focus is on the Japanese and the Australian market. The level of price is, one of the highest, and we developed their direct sales force i n those countries, the prices are set by the government t here is a fixed reimbursement price, on the medical devices. And then obviously, the USA market, which is the largest orthopedic market, with high level of prices. We developed here, again, a hybrid, model in terms of sales sector, which is mainly based on commissioned agents, but we are constantly, and in parallel, developing a network of, direct sales in the country as well. The price setting depends typically from procurement by hospitals, and since a few years, by the ASCs. We have been talking about the ambulatory surgical centers today, and I would like just to give you a short highlight on the ASCs in the US. According to recent studies and our estimation, while the US ortho market is growing, is expected to grow 4.6% in the next years, we are seeing and we expect a trend for the ASCs procedure to grow much faster, and to be able to achieve a quota of 50% of- more than 50% of the joint surgeries by 2030. Why are the ASCs so successful? First of all, because they are cost-effective for the payers, with about 40% lower cost compared to traditional inpatient treatment. There are financial incentives for surgeons to work and develop their practice there. There are some benefits, obviously, for patients as well, like potential lower risk of infection. And also, to a company like us, it is easier and faster to get into the approval and start working in ASCs than going through the approval process of hospitals, which means that it's easier to, and faster to start collaborating with surgeons in ASCs, and then moving later on together with them in hospitals. But it's more than that. Medacta's ASC advantages, our digital solutions, which can make surgical procedure smoother and eventually faster. The disposable sets of instruments, offering savings in terms of washing, sterilizations, time. The minimally invasive techniques, which helps in supporting faster recovery, shortening the time. And in the end, the fact that we have in the US a team which is fully focused on the ASCs. This to say that if we look at our own internal data, while currently the ASCs joint surgeries is estimated at around between 15% and 20%, as Medacta, we are running in the US 40% of our joint surgeries in the ASCs centers or as outpatients at hospital location s o we are, in a way, ahead these key market trends we expect in the next few years. So, we hit CHF 500 million turnover, which basically means that we have a global market share, which is in between 1% and 2% of the USD 38 billion total addressable market. Our focus, as I said, is in Asia Pacific, Australia, and Japanese market, with their appetite for new technologies. We have a good presence in EMEA, particularly in Western Europe, and especially there, we have been able to achieve up to 25% market share in some selected market or with some business lines. And finally, strategically, the US market, as I said, the largest ortho market globally, where we keep expanding our sales force network and are strategically focusing on the ASCs, ASC centers. To summarize, which are our strategic priorities in the next time? Continue our expansion, increasing our market penetration, focusing and reinforcing our direct sales force, growing both geographically and by business lines when this is needed. I'm thinking about sports medicine in the next years. And obviously, we will keep exploring new areas, because we will, in any case, consider any new opportUNiD. Build scale, leveraging our existing portfolio to increase our penetration in the market, continue to support our education platform and high quality level of service, which is one of the key to succeed and to make loyal customers, and continue to focus on all the different business lines, especially the newest one, like sports medicine. And finally, to keep driving innovation, as Mas presented to us, keeping the expansion of our established portfolio, reinforcing our collaboration with surgeons, and leveraging our unique product portfolio and the personalized patient solutions. I just want to leave you with the last message. On one hand-... We demonstrated the ability in some market or with some business lines, to become market leader and to be able to achieve up to 25% market share. On the other hand, we have just 1-2% of the global market share of these total addressable markets s o the combination of these two elements, let me say that, means we have a significant potential to keep growing across most of the markets and business lines for the years to come. Thank you. Maybe we can just do the last presentation, and if there are Q&A at the end, so everybody is able to listen to all the presentation. I know some of you need to leave at five sharp, so maybe we can do that, if you don't mind. I leave the floor to Alessandro. Thank you, Nico. Good afternoon, everybody. So I'll try and keep it short and sweet. My name is Alessandro Siccardi i am the supply chain director for the company i 've been working in Medacta since 13 years, and I inherited my father's job, but not the crown, so. But I'm good with it. No, I'm joking. So my job is mainly focused on four pillars, I would say. Of course, delivering implants to our countries according to their needs is the first one. Delivering those implants in the highest quality standards is the second. Making sure that we always have capacity, production capacity available to sustain our growth plans is the third. And all the while, last but not least, try to always reduce the cost of goods by vertically integrating new technologies into our production. We have told you already this morning that our facilities both run on 100% renewable electricity. Since 2019, we have been able to reduce the greenhouse gas emissions by 25% across these two sites. And we are able to recycle our waste to 90%, and this is quite impressive, quite something to be proud of. We are here today in Rancate w e have been this morning to Castel San Pietro y ou have seen that both sites welcome offices and production capacities. Here in Rancate, we focus on spine and sports med, where we are building here, as you see, around 9,500 square meters, which will also welcome future production for joint. In the meantime, our warehouse is here. For the people who still have time, I'll be happy to show you also the warehouse. In Castel San Pietro, as well, offices, and manufacturing joints, there is a new building, which was the building where you took the bus, after the production facility. There is a new building which is ready, I would say, almost ready, and it will be s orry, it will welcome 5,300 square meters. So, to give you an idea, in 2023, we were able to produce 1.4 million implants. It's a good number, I would say, and something that is quite impressive. Across the supply chains in all the countries, we have around 870 people. You see here are the expansions in Castel San Pietro and in Rancate. The idea, as I said before in the beginning, is to always be equipped in order to sustain the future growth and, to be able, whenever it's possible, to integrate new technologies in these expansions, also to reduce the cost of goods. About warehouses and logistics, we opened just opened a new distribution facility in Memphis to serve the U.S. market and to also be a backup for the rest of the world. And we have a new project in the pipeline to establish a second distribution center in Italy to serve Europe, Asia Pacific, Latin America, and also be another backup, but in order also to optimize net working capital and reduce shipping costs. We have full control over the Medacta supply chain t his is also key, and this is very shortly to show you how we do it w e have multiple sources, supplier strategy t his is something that my father taught me a long time ago now. Always have at least two options. And, we manage these, these suppliers, our suppliers, with long-term contracts, especially for raw materials and semi-finished components. Then once we get these components, most of our implants are fully manufactured in-house here in Switzerland, as you have seen, with a highly automated production, again, vertically integrated. Distribution and warehouses, as I said, we have a central, warehouse today here in Rancate, a backup distribution center in Memphis, which today serves the U.S. market, and local warehouses in all our direct markets. Again, the new project in pipeline is to open another warehouse in, in the European territory. You have seen, walking through our production in Castel San Pietro, that we have a lot of robotic processes put in place. Obviously, the goal is to reduce our operational costs, increase control over the processes, freeze up resources in order for the people to do other things while the machines are running, and increase the quality and shorten the production lead time. 3D printings, you're seeing it also i t's a technology that is easily accessible, it's cost-effective, and brings a better quality, gives you infinity options of shapes and geometry, which I always thank the R&D to give us these nice tools to play with, and reduces the risk of errors. All of this is the value creation passes through direct control of our key production processes t his is also very important w e always want to have our own eyes checking our own production. Quality. Quality is key. Quality is something that our father also made us aware since the very beginning w e cannot make any mistake, and if we do, we have to react immediately. So we are committed into delivering service and product solution that exceed all standard and regulation y ou have seen today during the presentations, for example, on the Spherica, that even though we got our CE marks or our FDA marks, we kept that specific product under strict surveillance for three years. This is somehow related to a good practice or to a best practice in order not to run any risk, even though we got the certifications. This is something extra that we do w e want to be extra careful. I think you got the message now. 20 quality assurance people and almost 60 people are working into the quality control. Quality control, which are done in processes in the production, upon receiving the goods, before delivering the goods. But the goal here is simply to say that Medacta embraces, and will always embrace, and will strive to improve on the highest quality standards possible. So I think I've been short and sweet. Thank you very much for your attention i f you have any questions? If not, I leave the floor to my brother for his closing. Thank you very much. Thank you. Maybe I can quickly run the closing remarks, and then we can have a last Q&A for everybody before leaving. I think I hope at least we managed to give you a little bit an idea of who we are, where we're coming from, and where we want to go. The key messages are here. I think we have proven to be able to be a good competitor in orthopedics. We have established a critical mass in a market that remains gigantic and where we have only scratched the 1%-2% market share, even less if you consider that certain business line have just started s o there is a huge, huge potential. You couple that with the fact that our presence in the key market is already established, so the baseline is there. In the U.S., our number one market, of course, in Europe and Japan and Australia, those four areas represent around 85% of the total addressable market, and then we have all the other distributors, so a lot to build upon a solid base. Commercially, the strategy will not change w e will just go deeper into those markets, especially expanding our sales force in the business line where we have less market share, which means basically everywhere, with few exception in Europe. But that's definitely the most important aspect, together with, of course, product expansion in the newer areas, in spine, in the sports med, a little bit less, of course, in the hip and knees, where our product range is already very solid. What is not gonna stop is our ability to constantly innovate our existing portfolio in order to maintain our ability to compete through innovation. This is, in my opinion, the most important aspect of Medacta. We always come with the best next product to cannibalize eventually our own. We don't want, we don't want to stop just because we are good enough. If there is an opportUNiD, we do it, and then we continue to grow. We mentioned where we should go with this strategy in terms of midterm growth. Our expectation is to continue to grow in the low double-digit region, with an adjusted EBITDA, which will be in the worst-case scenario, in line with 2024, and the variations in terms of expansion will depend mainly on top line growth, provided, of course, there are not special conditions happening in the market. This was our last slide, so if there are questions to any of us, please feel free. Question to Alessandro. You mentioned in one of your slides that you currently produce around one point four million implants per year. Now, we've seen the new building in San Pietro. You're expanding here, so if everything is set up, sort of, what is the sort of estimated number of implants that you can produce when everything is sort of ready? Thank you for your question. I said that last year we produced 1.4 million, not every year, first of all, just to clarify. There is not a number. The number is it comes from a sales prediction. We have to be ready to produce what is needed according to the sales forecast. So a sales long-term plan, I don't think we cannot disclose those numbers. Basically, doubling our square meters. Yeah. So- Let's talk square meters. Okay, so that is the plan. The production capacity in terms of shells will allow us to double volume-wise our current volume. And of course, then the sales will depend on the geo mix and the products, but roughly, we have created capacity in terms of balls that will allow us to double. Just to clarify once more on the outlook, it was the adjusted EBITDA margin, not the absolute rate? Okay. Absolutely, yeah. Okay. The margin. Okay. I have a question for Niccolò. If you have to rank the key reason why you are so successful in ASCs, is the product portfolio, is the cost, and how you can expand that in the future? I truly believe it's a combination of factors. I believe it's first of all about the products, and when I say products, I'm referring to the implants, to the techniques, to the instruments, to the different solutions that we can provide, which seems to be tailor-made for ASCs, like disposable instruments, like techniques that allow for a faster recovery. So it's a combination of these, mainly. Oh. Sure, I'll go first. Just on, US market is really competitive, and you have grown well there, but you're already in the ASC market, which is growing really fast. What will get you to grow even faster in the US? Is it products? Is it more direct sales force? Is it better, like, golf holidays for the surgeons? What's keeping you back there? I would say, especially in the U.S., success brings success. So building a brand from zero has been very, very tough. Having now successful products utilized by centers of excellence, which are well known in the U.S., helps a lot more than what it used to be ten years ago. Having key opinion leaders, champions using new products early on, this will accelerate, especially the fact that salespeople will come to us, and they will bring their customers. This is what we see more and more happening, which was never the case in the past s o quality salespeople is, in my opinion, the key to continue to grow faster in the U.S., and it is something we are seeing. Just following up on- They come because of the products, because of the success that this drives, the ASC focus, et cetera. You expect to grow in the U.S. faster over the next three, four, five years versus the rest of the markets? Because we haven't seen that. No, I dont expect this- You don't think you will. To grow faster because my impression is that the US market is. It's the CEO of Zimmer checking out. Event. No, I think that the US market is definitely much more controlled by the US companies. I have the impression they have a little bit less of a hold outside of the US. They have been doing very aggressive cuts, which helps, and that's probably one of the explanation that created some dissatisfaction, especially in Europe, supply chain issues. They protected the US from supply chain issue, for example, completely. They did a disservice to the market, but they limited as much as they could, the US, because they protect their own market. So it's tougher, for sure. It's more competitive. There are non-competes, for example, which are massive, so it's challenging. So I think we're doing a good job. We could accelerate a bit, but again, the U.S. to go much faster than Europe, it's unlikely. Sorry. What on this midterm plan, what cash generation do you expect, and operating free cash flow, net debt, sort of? I don't think we're guiding on the cash flow. I don't know if you want to give any qualitative flavor, but if you want, if you slow down the growth rate, and as we mentioned, the big CapEx effort on the building side is should cover quite a bit, then the rest is a reduced CapEx, so the cash flow is directly linked to the growth. If we are in the faster, high end of the growth, we are gonna have a limited free cash flow. If we are on the lower end, you are gonna have more free cash flow. But on the double-digit growth you're guiding, you don't expect negative free cash flow on the time period? Zero, that would be already... We try to generate some free cash flow. Unless, on the other side, if I see the possibility to accelerate, I'm pretty sure I will. What is the cost advantage of single-use instrument versus multi-use instruments? Cost advantage for the hospital? In producing. It's a completely different impact on the P&L. Instruments we depreciate, so it's actually below EBITDA. On the instruments, single use, their cost of goods sold, but the financial impact is very different, of course, because CapEx drops, you have a little bit of cost in the gross profit margin. You lose a little bit of profitability, but you save a lot in terms of financial cost. Still in the U.S., can you disclose the number of reference centers that you could have? I think you have 600 globally. And then a second question would be, are there any pockets or territories in the U.S. where you are completely absent, either direct or indirect, that would be helpful, just because I think you've mentioned that you are covering territories and then selectively prioritizing, you know, ASCs or bigger hospitals, and you still have less than 1% market share, so that would be helpful. Yeah, so let's start with, with the last one. The US is still a virgin market, if you want. We are everywhere, but we are nowhere. If you have one salesperson in New York, you can have 20 more. So we have a presence which is in the typical, crescent type of approach. You have the West Coast, the southern aspect, Texas, et cetera, and then you come up on the East Coast with a big presence, good presence in the Midwest. But can we double and double again exactly in those territories? For sure. And are there many states where we are still not present? Maybe not as a state, but in all of those states, there are plenty of big and mid-sized cities where we have no presence or very limited presence i t reflects the market share. On the reference center, if you take the big number, we use the reference centers in order to generate revenue. So if you use the proportion of revenues, you have an idea. It is a function of the need. You don't create a reference center if you don't need it. You create a frustrated surgeon, you tell, "Ah, you're gonna be a reference center," and then nobody shows up. Any other question? So if there are no question, I would like first of all to thank you all for coming here with us today hope it did provide some insight on who we are and what we do and where we're going. Before leaving you, I would like to thank all the team that presented today with me, but especially as well all the team that helped us to manage the logistics, the product fair, the company tours, and I wish you a safe travel back. Thank you very much. Yes. Sorry, just if you want to visit the Rancate factory, feel free to let me know, and I will welcome you downstairs at the reception.