Hello everyone, welcome to GN's full year 2022 conference call following our release this morning. Thank you all for dialing in. It's great to have you on the call. Participating on the call today is Gitte Aabo, CEO of GN Hearing, Peter Karlstromer, CEO of GN Audio, Peter Gormsen, CFO of GN Store Nord, and myself, Anne Sofie Veyhe, Head of Investor Relations, Treasury, and M&A. Today's presentation, which can be found on gn.com, is expected to last about 20 minutes, after which we'll turn to the Q&A session. With that brief introduction, I'm happy to hand over to Peter Gormsen. Thank you, Anne-Sophie. Good morning, everybody, and thanks for joining our full year 2022 call today. Starting on slide 4 with a snapshot of the performance during the year. We delivered revenue of DKK 18.7 billion, equal to an organic revenue growth of -3%, while revenue growth was 18%, driven by the acquisitions of SteelSeries and Lively, as well as impact from FX. The growth achieved during the year is a result of significant market share gains across soft markets. Adjusted EBITDA ended at DKK 2.2 billion, equal to an EBITDA margin of 11.6%. Growth in adjusted EPS ended at -31%, which was in line with guidance. As a result of the earlier acquisitions, the adjusted leverage ended at 5.5 times at year-end. During the year, we have launched multiple new products across the company, which Gitte and Peter will get back to later. These great innovations will be an important aspect of our ambitions for 2023, where we once again expect to take market share in challenged markets. Moving to slide 5 and our capital structure review. GN continues to be operating in long-term attractive markets, and we continue to gain share. As part of the strategy, we invested into the large and fast-growing premium gaming gear market by acquiring the best asset out there. The financing decision was made in an environment with low interest rates and financing widely available. Now, the world has changed. 2022 was different than expected. We generated less cash than expected due to a volatile macroeconomic environment, supply chain effects with high inventory buildup, and channel investments in hearing. At the same time, financing markets have completely changed with high interest rates and less capacity. After assessing alternatives, we have deemed it right to switch to equity financing. We intend to raise DKK 7 billion in equity through a fully underwritten rights issue. This will take us back to our long-term target of between 1 to 2 times net interest-bearing debt over EBITDA in the short term and provide the appropriate capital structure to underpin further growth and allow us to pursue our successful strategy to create shareholder value. Once we revert to target leverage, we will recommence dividend payments and share buybacks. With that, I'm happy to hand over to Gitte for an update on GN Hearing. Thank you, Peter, and hello to all of you. The key messages I want to leave you with are we had a very strong ending to the year with significant market share gains across countries and channels driven by the successful ReSound OMNIA. A few days ago, we announced five new form factors, which will finalize the ReSound OMNIA family. We look forward to seeing these form factors built on our current momentum in 2023. Based on the strong, complete product portfolio and strong momentum, we expect to deliver market share gains and market ex- margin expansion in 2023. Let's have a look at GN Hearing's Q4 2022 and full year 2022 financial performance. In the full year 2022, GN Hearing delivered slightly more than 5% organic revenue growth, while the emerging business delivered 73% organic revenue growth. Specifically in Q4 2022, GN Hearing delivered 14% organic revenue growth as a result of the strong commercial execution across the company driven by ReSound OMNIA. This growth was executed in a soft hearing aid market, which had a slightly negative growth in the fourth quarter. The gross margin was broadly in line with 2021, although it was negatively impacted by elevated freight costs, increased material costs offset by pricing initiatives and a successful launch of ReSound OMNIA. The EBITDA margin in the core business ended at 13.1% in 2022, driven by operating leverage with strong focus on the cost base. The EBITDA in the emerging business was negative DKK 187 million in 2022, but saw sequential improvement in the quarters throughout the year, and it is well in line with the financial guidance as a result of the stronger than expected revenue growth. Non-recurring items of DKK 146 million was booked in the year primarily related to the previously announced supply chain initiatives. Free cash flow ended at negative DKK 377 million for the year, reflected the earnings level as well as investments into future growth opportunities and strategic financial support agreements. Let's move to slide 8 and some more color on the regional development in the fourth quarter. Beginning with North America, we delivered 11% organic revenue growth in the quarter in soft market conditions. We experienced very strong performance across the independent markets, VA, and Costco, primarily driven by the successful ReSound OMNIA launch. To build on the short-term opportunities in Costco following the removal of KS 10, we launched an updated version of Jabra Enhance Pro in the beginning of November, building on the technology platform of ReSound OMNIA. Moving on to Europe, we delivered an organic revenue growth of 8% in the quarter, with particularly strong performance in Germany. In our rest of world region, the organic revenue growth ended at 22% compared to Q4 2021, driven by strong growth in, among others, Japan, despite market headwinds we experienced especially in China. Moving to slide 9 and our finalization of the ReSound OMNIA family. I have to say that I'm very impressed by the development in our R&D department during the last one and a half year. Today, we can proudly say that we've finalized the ReSound OMNIA family. We have achieved this only 6 months after releasing the platform, which is much quicker than traditionally. This is a great testament to our R&D organization being back to where it has been for more than a decade. ReSound OMNIA was originally launched in the RIC form factor in August 2022 and has shown impressive results in the last part of 2022. We are now finalizing the family and are introducing five new form factors. A new miniRIE product that is smaller than the current RIC product on the market, and then two new rechargeable BTEs and two new custom-made products, one rechargeable ITE and 1 battery version of a CIC. The new form factors will include the same benefits with 150% improvement in the ability to understand speech in a noisy environment. ReSound OMNIA is the only product in the industry utilizing a beamformer, which improve hearing and noise without feeling cut off. The product will be commercially available by the end of February. Let's move to slide 10 and the expected market development. Overall, we expect to see a soft but resilient hearing aid market in 2023. In 2022, we saw very strong market growth in the beginning of the year, but with some softness by the end of the year. As a result, we estimate low single digit positive volume growth in 2022. The demand for hearing aid product remains intact, fueled by demographic changes. Let me just re-emphasize that we are still not seeing any significant trade down. We continue to see the managed care segment growing faster than the private market in the U.S., but trading down as such has not been material. First time users continue to enter the hearing aid journey, but we do see some postponement in the replacement purchases for returning customers. Based on the above factors, we expect a low single-digit positive volume growth in 2023, and we continue to expect a low single-digit negative ASP growth in 2023. To conclude, we expect flat to slightly positive market value growth in 2023, which is softer than normal and also slightly more uncertain. The long-term dynamics are fully intact, and we don't see any reason why the market will not return to historical trends when the current softness is behind us. Let's turn to slide 11 and our financial guidance for the year. Our ReSound OMNIA product family has shown success in the end of 2022, and with the expanded and finalized product family, we expect this momentum to continue into 2023. Due to the market growth expectations, we expect an organic revenue growth in the range of 2%-8% for 2023, driven by continued market share gains and catering for the uncertainties for a slightly lower than expected market growth. The guidance range is slightly wider than normally. As for the adjusted EBITDA margin in the core business, we expect it to be in the range of 13%-16%, naturally correlated with the organic growth. EBITDA for the emerging business is expected to land at -DKK 150 million for the year, improving year-over-year. We expect to have non-recurring items of around -DKK 150 million, which is driven by the supply chain initiatives and right sizing of the organization. For the guidance, we are assuming the following for Q1. The organic revenue growth is assumed to be within our full year guidance range of 2%-8%, driven by continued strong commercial execution and market share gains from ReSound OMNIA in an assumed soft market. Specifically for the Q1 EBITDA margin in the core business, we assume a mid-single digit level, excluding non-recurring items due to the revenue seasonality and launch costs. With that, I would like to hand over to Peter Karlstromer and an update on GN Audio. Thank you, Gitte. Hello to you all. Let me start by saying how happy I am to be joining GN. The first month in the role has shown me what a strong organization I'm joining, and I'm excited about the future we can create together. I am new to many of you. Let me start with saying a few words about myself. The last 25 years, I worked in technology or telecom around the world. The first part of my career, I was with McKinsey & Company, working with technology and telecom in the Nordics, Europe, U.S., Middle East, Africa, and Asia. From there, I joined Cisco Systems, leading significant parts of the European business in close collaboration with the global R&D teams. Most recently, I'm coming from Securitas, where the European business going through a major technology transformation. As of a month, I'm the proud new leader of GN Audio and working hard to make a seamless transition from René, and together with our teams, build a strong and exciting future for GN and stakeholders. I'm now pleased to take you through GN Audio's results for 2022. Moving to slide 13. 2022 was a weak year in our markets, and we experienced significant supply chain disruptions, in particular in the beginning of the year, combined with a reduced consumer sentiment negatively impacting our consumer SteelSeries businesses. In this challenging environment, enterprise gained market share and delivered a slightly positive organic revenue growth on top of the record high base from 2021. For Q4 specifically, enterprise delivered 9% organic growth, which is a testimony to our strong product lineup and commercial execution. In 2022, the gaming equipment market saw a significant year-over-year decline. In this challenging market, SteelSeries performed strongly, resulting in significant market share gains driven by product introductions and strong commercial execution. For the year, SteelSeries delivered an organic revenue growth of negative 19%. We saw an improvement of trends throughout the year, which is encouraging. Consumer was especially affected by current market conditions and delivered negative 35% organic revenue growth in 2022. In total, GN Audio delivered negative 7% organic revenue growth in 2022, which is in line with our updated guidance. The GN Audio adjusted gross margins ended at 43.5%, which is 7.1 percentage point below 2021. This can mainly be explained by 4 factors. The first one is FX, with a significantly appreciating U.S. dollar driving a negative impact of around 4% on our business compared to last year. Secondly, we've seen elevated freight and material cost. Thirdly, there are consolidation effects from SteelSeries. Lastly, there were significant promotional activities, more than normal in the consumer-oriented businesses due to the high inventory situation across the industry. To partly counter this, we put in place pricing initiatives in beginning of 22, and have also increased prices in January of 23. The adjusted EBITDA margin ended at 14.1%, reflecting the gross margin decline as well as offsetting effects from OpEx management. Non-recurrent cost amounted to -DKK 460 million, primarily re-related to the SteelSeries acquisition and cost reduction measures across our business. The free cash flow ended at -DKK 91 million. We had a healthy operational cash flow, were negatively impacted by significant inventory buildup. Excluding work and capital changes, GN Audio would have generated free cash flow of almost DKK 1 billion in 22. Let's move to slide 14 and give a little bit more color on the region development in Q4, which excludes SteelSeries. In North America, we delivered negative organic revenue growth of 18%, explained by a significant decline in consumer business and an enterprise which experienced softness in the quarter, which was also the case in the third quarter. In Europe, we delivered solid organic revenue growth of 9%, driven by a strong enterprise performance across countries and customers. In the rest of world, the growth was negative 9%, explained by a growing enterprise business and a significantly decline in consumer business. Let's move to slide 15 and SteelSeries. In 2022, SteelSeries had an organic revenue growth of - 19% in soft market conditions. All year, there were some improvements in the market and our performance towards the end of the year. During 2022, we progressed well with integration of SteelSeries. We have now integrated supply chain and back-office functions, and recently also combined our sales teams of SteelSeries with our consumer teams into a joint organization. During the integration process, we've been able to retain key personnel on all levels. During the year, SteelSeries had launched several products that have been very well-received by the market. A result of this great work by our teams, we estimate that we gained approximately 2% of market share in core product categories. Let's move to slide 16 and the supply chain. We have used this traffic light system throughout 2022 to illustrate the different impacts on our supply chain. As you can see, the situation has improved. Today, the negative effect on our business is limited. With what we know today, we believe the supply chain will have no significant negative impact on our business in 23. We continue, though, to monitoring this situation carefully and will respond as needed. Let's move to page 17 and product launches. In 2022, GN Audio launched several new products showcasing our strong innovation. New products were launched across enterprise, SteelSeries, as well as consumer. A week ago, we also announced the newest innovation to our PanaCast portfolio with a fully integrated video bar system utilizing the technology-leading PanaCast camera. This new very well-received product is based on Android, which will help us to significantly increase the addressable market for us in video collaboration. With our current product portfolio and roadmap for 2023, we believe that we are well-positioned to continue gaining market share, in particular in enterprise and gaming. With that, let's turn to page 18 and an overview of the market, long and short term. First of all, we want to stress that we believe the long-term growth drivers for our markets are fully intact. The world continues to adapt to a hybrid work, I mean, environment. Enterprises globally are continuously deploying productivity-enhancing tools. While we experienced strong growth during the pandemic, we believe there's significant more growth to expect in the future as we continue to demand a better quality of experience in communication. We're also confident in the long-term growth and attractiveness of the dynamic and growing gaming market. In short, we expect our markets to return to healthy growth when the current macroeconomic uncertainty is behind us. At this time, though, we experience significant economic uncertainties, which is also affecting enterprise and consumer demand. No one knows exactly how 2023 will develop. In the last few months, there's been several revisions downwards in the expected market growth in our categories. As we plan for 2023, we're doing some different market scenarios, which also affect the guidance which we are giving. Moving to slide 19 on our guidance for 2023. Given the economic uncertainties, we're giving a broader guidance range than what we have done in the past. As for revenue, we expect GN Audio to deliver an organic growth rate from -10% to +5% in 2023. The guided range for the adjusted EBITDA margin is between 10% and 15%. The broad span is primarily driven by the difference in business volume. In all market scenarios, we assume that we will continue to gain market share, so the variance in performance is driven by variances in macroeconomic conditions affecting the growth of the markets where we operate. We expect the non-recurring items to be around -DKK 150 million for 2023 as a result of cost reduction measures in relationship to the right sizing of our organization. Our business is robust and well managed. Across our guidance range and scenarios, we expect to generate a positive cash flow for 2023. For the guidance, we're assuming the following for Q1. Organic revenue growth is assumed to be negative due to the current challenged market conditions. In Q1, the EBITDA margin, we assume a mid-single digit level excluding non-recurring items due to the top-line development and investment in growth opportunities. With that, I'm happy to hand over to Peter Gormsen. Thank you, Peter. At group level, GN delivered -3% organic revenue growth and an adjusted EBITDA margin of 11.6%. Total non-recurring items were -DKK 624 million, driven by the SteelSeries integration, the cost reduction measures, as well as the supply chain initiatives in GN Hearing. Adjusted leverage ended at 5.5x is related to the inventory situation, which is expected to improve, especially in the second half of 2023. Let's move to slide 23 and a recap of the financial guidance. Peter and Gitte already went through the guidance across Hearing and GN Audio. I will keep this short. To conclude, for group level, we now expect organic revenue growth of between -6% to +6%, which will result in further market share gains and expected challenged market conditions. EBITDA and other is expected to be around DKK -200 million. With this, I'm happy to hand back to Anne-Sophie. Thank you to Gitte Aabo, Peter Karlstromer, and Peter Gormsen for the updates. With that, I'm handing over to the operator for Q&A. Please limit your questions to two at a time. If you would like to ask a question, please press the star and one on your touch-tone phone. You may withdraw your question at any time by pressing the pound key. We'll move first to Martin Parkhøi with SEB. Your line is open. Martin Parkhøi, SEB. Two questions, both to Peter, but not the same Peter. I'll start with one on GN Audio. I struggle a little bit with your comments on the first quarter. First quarter last year was extremely weak. It served as the absolutely easiest comparator going into 2023 for various reasons. If you are not able to grow in the first quarter, how should we be convinced that - 10% for the full year is actually at risk? For example, for last year, you saw 32% growth from Q1 to Q2. Is this downside actually higher than, worse than -10% for the full year, with the market challenges you see in the first quarter? To the other Peter, I think it's to you, and maybe it's to the board, but they are probably not here. That's a question. Do you feel comfortable that the authorization for the rights issue will actually be granted at the Annual General Meeting? Do you see other alternatives? Related to that questions, have you been approached with other alternatives than a rights issue to bring down the debt? Okay, thank you for the question. Let us start with your first one. As you rightly highlight, I mean, Q1 is relatively low compared to what we like it to be. What we see are a few things. I mean, around the world, there's been a lot of uncertainties and probably increasing uncertainties, and also that is affecting the markets where we operate somewhere. We believe that in particular in the U.S. side of the market, we see a bit of a weaker demand at this point in time. This guidance for Q1 should be exactly to clarify that we see a relatively slow start on the year. We expect, though, that the growth will improve over the year, and we're also launching several products throughout the year that will support this growth of our business throughout the coming quarters. You're right, Q1 is a bit lower than what would be normal. Hey, Martin. On your other question, this is Peter. Of course, maybe to take a step back. We, we have of course looked at all the available options, alternatives that we had as GN. We have had many thorough discussions among management with board, with Peter coming in. We've spent a lot of time analyzing this. This is clearly, it's a big decision. Do we feel comfortable? We firmly believe this will put GN in a better position and puts us in a better position from where we can grow and we can continue taking share. I think that's the short answer. Of course, we understand there is different reactions when you come with a cap, desire to do a capital raise. I think we've done our homework. I think we are very well prepared. Again, we feel it's the right decision to and will put you in a much better position after our general meeting. Thank you. We'll move next to Maja Pataki with Kepler. Your line is open. Yeah, thank you. Also two questions from my side, going over to the Peters in the group. Peter, on audio, I'm sorry, coming back to the, you know, to the question that Martin Parkhøi has posted. If we have to look at a negative growth in audio in Q1, and it being the softest quarter throughout 2022, what triggers are there that are going to accelerate growth? Or what visibility do you have that the markets are actually going to improve meaningfully throughout the year? That's my first question. My second question, Peter, you talk about getting the leverage in the short term to the 1%-2%, 1x-2x EBITA range. Could you maybe tell us what you consider being short term? Is that within this year, or is it something in the next 12 months? Thank you. Okay, let me start here. As I mentioned, we believe the range for the year is -10% to +5%. Part of that range we are factoring in a slow start in Q1. What we see at this point in time is market related. It's not our ability to operate in the market. We believe that even with this kind of conditions we see now, we should be able to meet our guidance. What we also should say is that towards the latter part of the year, we are introducing several new products, which we also think will help our business to grow compared to the market. Okay. you're not expecting the market to improve meaningfully towards the end of the year? It's more the product launches that you have. Yes. We believe if the market stays stable to the level where they are now, we believe we will be able to operate within the guidance we have given. Okay, thank you. Maja, this is Peter. On the short term, I don't think we will disclose exactly what month this will happen, but I think our definition of short term is probably in the range of 6-18 months. Okay, super. Thanks. Thanks a lot. We'll move next to Julien Ouaddour with Bank of America. Your line is open. Thank you very much. Good morning, everyone. I have two as well. First one, GN Hearing, tough 2022 year, let's say for the profitability. It's surprising to see the guidance range starting at 13%, which basically implies no margin expansion, despite you have, you will have organic growth. You have some assets that you could sell. For example, like the Portuguese retail one, you have some buildings, et cetera. Is it still expected to be like to be sold at some point? Thank you. Thank you for the question. Let me just underline that as we move into 2023, we actually see the strong momentum of ReSound OMNIA continue. That's obviously really nice. Nevertheless, we do see, as I spoke to, a softer hearing aid market as such than we would see normally, and especially we expect that to be the case in the beginning of the year. We expect overall the hearing aid market to be flat to around 1% value growth, which is lower than normal. That is the basis for our broader guidance range that we see this uncertainty. When we guide 2%-8% on the top line, it's definitely reflecting strong momentum at and that we are taking market share. Now, in terms of the profitability, obviously, if we end up in the lower part of the range, say 2%, that has an impact on the profitability, 'cause although we've taken a number of measures to improve costs, we also expect our cost base this year to be impacted by inflation. Also, we have important launches coming into the picture. We've already announced five new form factors in the ReSound OMNIA family, and obviously there will be more coming into the market later in the year. I think those are the key building blocks. Are we at the upper end of our Guidance in terms of top line, it will obviously positively impact our profitability. Hey, Julien. If I may, just before we jump to the second question, do you confirm the sort of midterm guidance for more than 20% EBITA margin for this business after 2022 being around like 13% and like probably this year not like exceeding mid-teens. I mean, is this still a target for you? If yes, just if you have sort of timeline in mind just when you would be able to get back to this level. The answer is yes. We have communicated to the market that we'll be back at 20% in 2024. That still stands. Hey, Julian. On your second question, the short answer is yes, we certainly still are very focused on generating cash, and that also includes, looking at our balance sheet and, divesting some of our non-core assets, including the Portuguese retailer that you mentioned. As said before, we spend a fair amount of time discussing this, and we certainly reached the conclusion that we are quite convinced that, one to two is the right- It's across the board. It's across all regions and countries and so on. We really see strong performance. It is due to the fact that we've launched ReSound OMNIA, which is well-received in the markets. Great. Thank you, guys. We'll move next to Kristian Rumph with Danske Bank. Your line is open. Hi, good morning, and thank you for taking my questions. I've two as well. First one for Peter Karlstromer. Can you talk a bit about your expectations for the SteelSeries business here in 2023 and how we should think about that relative to the overall guidance for GN Audio? My second question is to Peter Gormsen, and on the rights issue, and specifically why the decision to wait till the ATM, or sorry, till the AGM, to get this approval. As I read your articles of association, the board should be authorized to do this straight away. Can you clarify this matter? Thank you. Okay, let me start here. If I take us back to what we've seen the last year, I mean, the gaming market has been in a quite challenged state through 2022. The market and through the whole period, SteelSeries has gained market share, which we are very pleased with, thanks to a strong portfolio that's been further strengthened during the year. In terms of expectations for next year, I mean, of course, also here we have scenarios depending on the market development, but generally we are very positive to the SteelSeries trajectory. We do expect that in several of our scenarios, certainly the upper end SteelSeries will deliver growth in 2023. Thank you. Hey, Christian, this is Peter. I think as I said before, reaching a conclusion of doing a rights issue is a fairly big decision. I think, we wanted to make sure that we had a very thorough review, that we had all the necessary collaboration dialogue with both board and among management and advisors on getting to this conclusion. That you don't do overnight, and of course, we did not want to jump to any conclusions. We are certainly aware of what opportunities we had, but we feel this is the right process and we had a very good process then these things take time. I think we are exactly where we wanted to be. Thank you. Move next to Hassan Al-Wakeel with Barclays. Your line is open. Thank you for taking my questions. I have two, please. Firstly, following up on the cap structure and given the size that is high, that was higher than many investors had expected, can you comment on whether you have any indication from large shareholders that they would participate in the rights issue? That's the first question. Then secondly, on hearing, could you talk about whether you're seeing any initial signs of spillover of volume deferrals from the U.S. into Europe, and any initial signs of downtrading in Europe, and whether you consider this to be a meaningful risk in 2023? Hey, this is Peter. Of course we have talked with our largest shareholders, and of course they need to have a chance to also read through this, but I think the feedback is largely positive. In terms of how the European market is developing compared to the U.S. market, I think it's important to keep in mind that a big part of the European market is actually covered by reimbursement. In many European countries, you see hearing aids being subsidized by the governments. We actually continue to see slightly stronger growth in the European market than what you see in the U.S. market. In Q4, when we look at the global hearing aid market, we saw a slightly negative development. That's very helpful. If I can follow up just on, you know, the overall reception to OTC and whether you're seeing you know, a younger demographic entering the market and expectations for the contribution this year, that'd be helpful. Yeah. Bearing in mind that it is obviously still early days in the OTC market, what we've seen is that we actually do reach a younger audience based on the data points we have so far. The average consumer in the OTC market is 59 years of age, whereas what we see in the traditional core business, people are in their mid-70s. We're definitely reaching people earlier on in the hearing aid journey. On how that market will develop this year, I expect it to continue to grow. Obviously it's still early days, and it's something that we follow very closely. I think we are well-positioned to compete in the markets. Very helpful. Thank you. We'll move next to David Adlington with JPMorgan. Your line is open. Hey guys. Thanks for taking the question. Maybe just one on audio first. Obviously the guidance is quite conservative, given the start and the comp. I just wondered if you were seeing any weakness on the enterprise side. Obviously, the consumer side was very, very weak last year. Wondering if you're seeing any actual confirmed softness in the enterprise side. On the consumer side, you cited promotional activity in the fourth quarter. Just wondered how much of the... Well, firstly, how much the consumer declined in the fourth quarter and how much of that was due to price/that promotional activity. Thanks. Thank you. I mean, already last year we saw a very uncertain market and continued to see that into the year. We feel very good about our enterprise product portfolio and our ability to gain share. Specifically what we're seeing more market related is a bit of, I mean, weaker development in the markets in the U.S. than what we're seeing in the rest of the world. We saw a tendency of that also last year and managed to, in total, grow the business. There are a few different dynamics going on that we're monitoring carefully. In all scenarios, we are very confident in our position and our portfolio. In terms of consumer, I think. Help me here, Peter. You have the numbers. Yeah. Q4, we were down 38%. You had both volume decline and to your point, David Adlington, also price decline. Yeah. Just a further comment on the split with that. I don't think we have that, I mean, exactly in the way we can communicate. Certainly combination of a relatively weak market and significant promotions in particular towards the end of the year. Okay. I just wonder what you thought. I think you mentioned the presentation, though there is not a lot of visibility. In terms of particularly on the consumer side, what stock levels were like and inventory levels were like in the channel? I mean, our assessment is that towards the end of the year, they were relatively normal to what we have seen before. Great. Thank you. We'll move next to Oliver Metzger with Oddo BHF. Your line is open. Good morning. Thanks a lot for taking my questions. The first one is on the planned equity raise. If everything goes through, how are your plans to buy back debt? It's a fixed debt, and the bigger maturities are due in more than 1.5 years. If you buy them back and they're trading still significantly below par, it means that at the end you buy them back with a strong premium or with a respective premium. Even today's bond prices already react quite positive. How to think on it conceptually? Do you want to buy back earlier, or do you just want to remain the cash on your balance sheet until the debt is due? Second question is on GN Hearing, also on the organic growth guidance. The range is just very broad. You made your comments. There is a higher level uncertainty on the market. Given your current strong momentum in Q4, also what you have said regarding the first month. For me, it appears like the lower end appears as a very bad worst-case scenario. How do you derive to this lower end? How is this possible regarding your assumptions? Thank you. Hey, Oliver, this is Peter. I think, generally, we do not disclose those level of details, but of course we are certainly aware that there is a possibility to tender bonds, but. Yeah. Thank you. We'll move next to. Line is open. Hi. Good morning. Thanks for taking the question. As an example now, we're investing to build a strong position in the video market. No major changes related to the capital increase here. Okay. Thank you. I think that, I mean, we definitely want to continue our strategy of being a growth company and operating in segments where we have the position to take market share. I think, we've demonstrated that throughout 2022, and we want to continue doing that. I think it's more, the capital raise is a, is a different way of financing the acquisition of SteelSeries. That's all. No change in strategy. Understood. Thank you. We'll move next to Sezgi Ozener with HSBC. Your line is open. Hi, thanks for taking my question. Sezgi Ozener from HSBC here. My first question is regarding your midterm targets. Of course, the leap from 2022 to your midterm targets become larger. Can you maybe give some color about how you see the projection from 2022 levels to your midterm targets, and whether in terms of timing, midterm changes, or whether that stays around 2025 as well? And a second, in terms of the inventory, the inventory progression was quite striking, so could you give some color about the dynamics, whether the required inventory became more because of the reaction to the requirements of your, well, of your supply chain or whether there is more to it? Thanks. As I've already mentioned, we confirm our midterm target and also our target of being back at 20% EBITDA margin in 2024. The building blocks towards that is clearly revenue growth. That is an important part of that. I think we saw the impact of revenue growth in the fourth quarter. We obviously get a lot of leverage from that, having had a strong focus on controlling our OpEx. In addition to that, we have both last year and this year taking a number of measures to improve our supply chain and ensure that our products are designed for manufacture. As we move into 2024, a larger part of our portfolio will be designed for manufacture, which means that we should see improvement in our gross profit. Those are the main building blocks, if you like, efficiency in our supply chain and top line growth. Here for Audio. I mean, first on the midterm targets, I mean, we were almost there a little while ago, and now we're working through some market uncertainties. We're confident we will soon be back there again as those uncertainties in the markets have cleared, so reconfirming that guidance. When it comes to the inventory, as many players in the industry, we have an elevated inventory situation on year in Audio. A few messages on that. First, it's of good quality, so we're convinced we'll be able to take use of this inventory in a good way. Of course, there are many different components to the inventory situation. If you look on the parts that we would like to reduce, those are gradually getting reduced. Of course, we still need to have a healthy inventory because we're also launching new products in particular here in the first half of this year. I think it's fair to say that we probably will see a somewhat increase in the inventory now in Q1, and then throughout the year we should see a decrease from that position. Okay. That's very helpful to see. Just to confirm, in terms of the leap in margins, 20% you're already expecting 2024, and from 2022 levels. Since that's stuff that was quite a jump, that's what I wanted to check how you expect that progression, whether you expect already towards the second half degree before the first half or not. That was just maybe just as a follow-up. Thank you otherwise, the clarifications are helpful. Yes. Let me be clear. I confirm that we will be back at 20% in 2024, and the two big building blocks are further efficiencies in our supply chain leading to a lower cost per unit, and the other thing is top line growth. Thanks very much. We'll move. We'll take a follow-up from Martin Parkhoi with SEB. Your line is open. Yes. Martin Parkhøi, SEB. Gitte, stay on the 20%, because I just wanted to confirm one thing is that this year you're guided 13%-16% on an adjusted EBITA margin for the core business. In the midterm, it says 20%, it says, only says 20% on an EBITA margin. Can you confirm that that means that there will be no further one-off costs in 2024, as we have seen for the last couple of years? Stig, maybe, Gitte, you can elaborate a little bit on the, on the market development, because now we have seen you delivering 14% in the fourth quarter. We saw Demant earlier this week delivering 11% in wholesale growth of hearing aids. We saw WSA only 1%. Still, we haven't seen any profit warning from Sonova yet. How can you actually come to the very soft development? Because it's actually not what we have seen in reported numbers yet. Martin, on the two questions, first off, are we planning non-recurring items in 2024? No. On the last one on the market development, when I speak about the market development, it's actually based on numbers coming out of EHIMA, so the manufacturing organization where we all share our volume numbers. Assuming that everybody has reported in the units correctly, this is actually the picture we see. Obviously, we cannot see the individual manufacturers, but we can see how the full market has developed. Those are the numbers I'm referring to when I talk about a negative growth in Q4. Thank you. Take another follow-up. We'll move to Maja Pataki with Kepler. Your line is open. Thanks for taking my follow-ups. Gitte, for you this time. We are, you know, we're seeing a good growth acceleration in Q4 in hearing. Yet what was quite surprising is the soft number that came out of the VA, where you were not able to hold on to the market share gains that you've reported in November. Can you kind of share your thoughts? What is wrong in the VA channel or why, you know, why you don't seem to make any progress in the channel, and if you think that is going to change going forward and why? Just a very short one. In your presentation, you were talking about the emerging business, and you said it's primarily the JabraEnhance.com. I mean, what does it really mean, like, primarily? Is there anything else that is in there? Thank you. Yeah. Let me take the last one first on the emerging business. I mean, it's, it is Jabra Enhance.com. Sorry for not being more specific. I mean, I'm struggling to remember if we book anything else under that. I mean, the top line growth and everything is Jabra Enhance.com and nothing else, just to be clear. Yeah, just to double-check, I mean, through JabraEnhance.com, you're now also selling OTC products, right? Yes. How are you accounting for that? Is there? At some point in time you said the OTC will be booked into traditional business. The Jabra Enhance, which is selling sort of traditional. How do we think about that going forward? Is it gonna be split or one way or the other? Yeah. I guess, at some point, maybe in 2024 later on, I guess, emerging business will become a normal business. For now, everything that is sold through Jabra Enhance.com is considered emerging business. Okay. VA? Now, in terms of VA, obviously, I was also disappointed to see that our market share dropped in December. Obviously, that is not our ambition. We've seen such a strong reception of ReSound OMNIA in the rest of the markets, across countries for that matter. Obviously, we expect to see a different development in VA. It's been no secret that we've been struggling in VA for a while, and I guess it just takes time to rebuild the confidence in that channel. I am however, confident that we will also see our share in VA develop positively over the year. Throughout 2023? Yes. 2024, I mean. Okay. Thank you. We'll move next to Daniel Yakutilov with Stifel. Your line is open. Yes. Hello. Also to Gitte. First of all, I was very impressed by your European organic growth of 9% when we consider that France had this high base from the reimbursement change and considering the fact German market was down high single digits according to the statistics. Can you... I know it's most likely OMNIA, but can you give us a bit more flesh on the bone? I mean, probably your market position in Germany and France is probably much lower than the other bigger rivals. That's the first question. The second one is that, has the battery feature helped you to gain market share with OMNIA as the bigger competitor decided not to have battery functions in his premium product, which I hear from audiologists is a niche nowadays, but still quite important for some patients which don't have rechargeable possibility every day? Was battery as well a driver for your OMNIA success? A lot of good questions. Thank you for that question, and let me start with the battery question. I mean, obviously, we do see part of our sales of ReSound OMNIA in the RIC version and the battery version, but I mean, by far the majority is rechargeability. It's like more than 80% of our sales are rechargeability. It adds, but I wouldn't say it's a key driver. It is, it's just that ReSound OMNIA is a really great, reliable product. I think that's the reason why it's so successful. In terms of Europe, I mean, you are right in the sense that France has a lower weight in our all European business because our market share in France is relatively low. Although the French market didn't develop as much, it didn't have the same impact, and we actually still managed to grow and take market share. The same actually applies for Germany, if you like, that, again, our market share in Germany is still relatively low. We have a good condition to grow from. ReSound OMNIA was actually really well received in the German market, which led us to have very strong growth numbers in Germany. Okay, great. We'll take the next question from Niels Granholm-Leth with Carnegie. Your line is open. Thank you. Could you provide a little bit of cash flow guidance for this year? I know that interest rates, of course, would have an effect there. I mean, if we assume that you don't do the rights issue this year, where would you expect your free cash flow to arrive for this year? What would be your assumptions for your networking capital development for this year? Thank you. Hey, hey, Niels. This is Peter. If we start with the networking capital, I think Peter spoke into it a little bit. We will see a phasing where we probably see a modest increase here in Q1. Bear in mind, we have a lot of components coming in still with some unfortunately up to 15 months lead time. We expect to bring it down again. I think we did manage to bring it down in Q4 already, that worked well, we are continuing being extremely focused on doing that. As Peter said, we have the right products. It's healthy components, we can certainly sell those. We're also very focused on not doing heavy discounting to get them out in a very fast way. I think we balance it in the right fashion. That inventory reduction will drive a positive cash. And I think I've earlier shared that we actually work on having up to DKK 1 billion positive impact from networking capital. Of course, all the uncertainty we're looking into can spoil that a little bit, but we are still working towards that aim for the year. We don't guide specifically on cash flow, but as Peter said, we certainly plan to deliver positive cash in 2023. On that line, where would you expect your net financial cost in the P&L to arrive for this year, say, provided that you don't do a rights issue? I think, normally we assume around little less than DKK 100 million per quarter, so that would be around DKK 400 million for the full year on the financial items. Thank you. We'll move next to Oliver Metzger with Oddo BHF. Your line is open. Hi. Thank you. Two follow-ups. First, on audio. You have this ample slide where basically all the supply chain situation is or has normalized in Q4. Enterprise was up by 9% in the quarter. Was there any impact from pent-up demand in the quarter? Would you say that the underlying development was below your reported result? Second question also on the enterprise development in North America. It's again weak. Is it more about reluctancy of customers to buy equipment, or do you see some down trading in the market? Okay. Thank you for those questions. First on the supply chain, the answer is no. The growth in Q4 was not related to pent-up demand. We see that as unrelated to that. Your question on the U.S.. I think it's more the uncertainty, which is probably quite broad-based in the macroeconomic environment, is driving to longer decision cycles and hesitations to purchase. We see a slowdown in particular the U.S. market at this point in time. Okay. That's helpful. Thank you very much. We'll move next. We'll take our last question from Veronika Dubajova with Citi. Your line is open. Hi, guys, thanks for squeezing me in at the end for a follow-up. I just wanted to clarify the comments around the audio guide for the year and both for the year and for the first quarter. I guess, Peter, maybe just remind us within the range that you've given, if we just look at the midpoint of it, what is it assuming for enterprise versus consumer? Maybe the same comment for the first quarter. I'm just a bit surprised by some of the comments that you've made on the call. I just wanna make sure we all understand it properly. Thank you. When we made those scenarios, I mean, it's been in different, of course, expectations and different segments, so it's hard to call it out in exact way that you're asking the question. I can say, I mean, as I tried to highlight in the intro here, I mean, we feel very good about the portfolio for enterprise and gaming, where we continue to gain market share. I think you should see that as that's probably where we see the strength in the portfolio at this point in time. Generally, you should expect those markets to perform well. Again, they of course operate in markets that are impacted by the macroeconomic situation. The softness that you're expecting for the first quarter, that's driven by enterprise or by gaming? I would say that is driven primarily by the U.S. market. I would say that is, that part is at this point in time also in the enterprise market in the U.S. Okay. That's helpful. Thank you, guys. There are no further questions at this time. Thank you very much, operator, and thank you everybody on the call. We appreciate your time today, and we will see you on the road. Thank you very much.