Good morning, and welcome to the HusCompagniet first half 2022 results call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, press the star one again. For operator assistance throughout the call, please press star zero. Finally, I would like to advise all participants that this call is being recorded. Thank you. I would like to hand the call over to Martin Ravn-Nielsen, CEO, to begin the call. Thank you, Martin. Over to you. Thank you so much. First of all, thank you to all of you diving into this conference call about HusCompagniet's first half of 2022 result. My name is Martin Ravn-Nielsen, CEO of HusCompagniet. With me today I have Mads Winther, our CFO. After the disclaimer, you see our summary and the highlights. In the first six months, you will see we have a revenue growth of 11% to DKK 2,266 million. You have seen our sales decrease with 47% year-over-year, but also from an extraordinary high level in H1 2021. Our EBITDA is DKK 175 million. It was a margin with 7.7% despite an extraordinary supply chain pressure. The target of delivery is still 98% on time. It was what we have maintained. It is very important also around the customers. You saw in the Q1 2022 that we have a share buyback on almost DKK 37 million. Our acquisition of the factory in Esbjerg in Denmark. It was closed on 1 July 2022. If we are going to the market, then we absolutely see lower market demand in H1 2022, also after an extremely high activity in the H1 2021. We also see a cost inflation, a lot of higher prices from the suppliers, due to accelerated energy prices. We see the supply and demand balance for the subcontractors is more normalized in Jutland and Funen, but we absolutely still see some bottlenecks in Zealand. Around our outlook 2022, Mads will come back to that later, but just some numbers also from me. We see now that we will have a revenue in between DKK 4.1 billion-DKK 4.4 billion. EBITDA before special items between DKK 340 million-DKK 360 million. EBITDA is between DKK 265 million-DKK 290 million. EBITDA is also, with an adjustment including the special items, will have an effect around DKK 20 million-DKK 25 million from the reorganization that we now are looking into. The expected leverage ratio is around 2.0x net debt to EBITDA. If you're going to the next page around the market update, then I can see that we have seen a significant decrease in the demand in H1 2022. We have seen it here in July, and we also see it here in August. It is a lot of factors. Actually, we have seen the rising interest rates and inflation which has been significant. We see now that the building industry is slowed down. The customers is more aware now, and therefore our visibility is extraordinarily low. When we are looking into the B2B market, also the professional markets is also impacted by slowdown, and therefore we will see also that the sales level for 2022 is expected to be lower than 2021. We still are comfortable around our strategic midterm targets going forward, also because we still see us as a very strong player in this industry going forward as well. For now, we are in a visibility and a situation which is extraordinary. When we talk about the subcontractors, we see now that Jutland and Funen starting to be more normalized in the demand balance, but we also see that the bottlenecks still exist in Zealand. We have made some adjustments. We will now take some adjustments in our organization, just to the demands that we are looking into. We have earlier this year decreased our organization with 41 FTE. Now this month, we will also adjust with 46 FTE in this month. Therefore, we all the time is make the right organization. We make the adjustments to what we're looking into and the demand. If we're looking into the supply chains, yes, the visibility, it has reduced further. We still deliver 98% of our houses. The energy price increases are significant, and it is also what we are seeing from the suppliers, and therefore we have a pressure that way. The extra cost we see now due to accelerated energy prices, it is also what we have seen in the first half year. We look into some better margins in H2 because we have made some sales price adjustments who will have an impact in all our deliveries in 2022. That way is what we're looking into. Currently we see some risk also in the supply chains because the gas situation is a challenge going forward and also, as you know, the geopolitical situation is extraordinary for now. If we are looking into the market about the detached on the next page, it is actually why we have made adjustment in our or adjusted our organization because the private customers are more hesitant for now and therefore to align our organization to the demand. We already earlier this year have adjusted the organization with 41 FTE, and then now we will do it again this month. The reorganization in here in 2022 will make some savings on an annual basis in SG&A, approximately around DKK 55 million-DKK 65 million. As I've mentioned before, the visibility is absolutely reduced, and therefore we are monitoring the market very closely, and we are on track to have the right organization going forward to the demand that we are seeing. If we are going to the next page around the highlights for H1, then you see the revenue is DKK 2,266 million. It is 11% up from the same period last year. The EBITDA is actually the same as last year. It is DKK 175 million. The EBIT is DKK 151 million, almost the same also as that last year. We have available cash of DKK 262 million. Our deliveries is 732 houses, and our EBITDA margin is 7.7%, compared to last year, 8.6%. It is primarily the extra cost pressure that we have seen in the H1, as we also earlier have mentioned, will be a pressure. We still see that H2, we will maintain to have better margins than we have seen here in the first half. The EBIT margin is also there 6.7%, a bit lower than last year. The financial gearing is 2.2x, and it was 1.8x last year same period. If we're going more into the highlights in Q2, it is the next page where we see that our revenue is DKK 1,094 million. It is up almost 1%, and our EBITDA is DKK 76 million. Compared to last year, we was around DKK 100 million. The EBIT is now DKK 64 million. The deliveries is up with 526 houses. It is 24% up. Our EBITDA margin is now 6.9% and the EBIT margin 5.8%. If we are going more into the deliveries in H1, in the next page here, you can see that we are up in the first half on 23% year over year. In the figure in the left side, you see also if you are looking into the quarter by quarter in Q2 2021 compared to Q2 2022, here we can see we are up with 24%. The segment split you can see in the figure in the right side. It is all our segments here that we are up in the deliveries. If you're going to the next page, which is the sales for H1, we are here down 46% year over year in the first half. The figure on the left, you can see it is 50% we are down from Q2 2021 to Q2 2022. It is also the segment split you can see on the right side. It is especially the Detached in Sweden that was the main, you can say, reasons for the significant lower level, and the semi-detached is 12 units that we have more or less in the sales. Maybe, Mads, over to you around the segments and some numbers. Yes. If we look at the next page with segments then, reflected on the left side of the page, we can see that we continuously see that the Detached business, the Sweden and the semi-detached business growing faster than our Detached business. So good news on that. If we then move into the right side of the table, what is really worth highlighting is, of course, that we have a fairly low share of own land. As many of you already know, when we sell own land, we have higher margins. The year is affected by this. It is not a big surprise. We have guided that it would be below 10%, around 10%. This we are seeing. Also we see a decrease in semi-detached while they are growing. When we then look at the average sales prices, we can see that we are starting to see an effect of the price increases we have done. As Martin also mentioned, we will see margins bottoming out here in Q2, and we will start seeing the price increases that we have put in place starting to kick off a bit more in the next quarters. As we can see in Sweden, it's pretty much linear. Of course, you cannot see the decimals here, but they have a sort of a pretty steady business. Looking at our EBIT, EBITDA margins on segment-wise, we can see that detached is hit on this. We are also seeing an effect in semi-detached. We are of course building up an organization as you all know, which is affecting this. As well, a lot of the projects we're doing in semi-detached is around Zealand, where we are seeing this congestion also around subcontractors that has extended a little bit more. We are seeing some effect of that. In Sweden, we are seeing a margin decrease, which is due to two elements, a mix of what houses we sell, and the second part is just of the prices that have increased on materials as well. Moving on to the next page around order backlog. I should first highlight that the order backlog net, which is 58%, it's 60%, so we will correct that of course in the material. If we look at order backlog gross, we can see that it's declining due to of course, when we say that the sales are performing at lower levels, we are slowly starting to see that in our order backlog. We still have a very strong and healthy order backlog. Here gross a little bit down from the full year. Then when we look at the net order book, then we can see that that's down now to 60% of our midpoint 2022 guidance. Remember that the net order book is what we're gonna recognize from a P&L perspective moving forward. It's mainly the detached market that we are seeing dropping in order backlog, but also the semi-detached. Oh, sorry, not the semi-detached there. We are of course adding, sorry, 56. That's taking a cushion on the order backlog. Moving to the next page on outlook. Martin also went through this in the beginning, but we are lowering our outlook, and it's basically impacting revenue, which is taking slightly down due to that we're seeing less sales. We are taking EBITDA down from DKK 370 million-DKK 410 million to DKK 340 million-DKK 60 million. EBIT, as well as Martin mentioned there, we're of course seeing also the full effect of the special items following the redundancy round that we are now commencing here today. We're very happy to on all these less good news, at least highlighting that the leverage ratio will be lower despite us buying the factory, as you all know, in April. We will be looking at lower leverage ratios, giving our flexibility in our business. On the assumptions for the outlook, Martin also went through this. Of course, disappointing sales, we're taking those down. We're also seeing a small effect on our deliveries, but they are close to the same. Given the congestion we have in Zealand, we are also taking a little bit more on semi-detached revenues, we're taking at least guidance opening up for being between DKK 450 million-DKK 500 million. Then I think the main items were around the special items of DKK 25 million-DKK 30 million that we expected, and they are due to, of course, the reorganization, but remember, we're also closing offices, et cetera. Those costs will be included in this and move forward to 2022. With that, I will leave it to the moderator for Q&A. Thank you, Martin and Mads, for the presentation. At this time, I would like to remind everyone. In order to ask a question, please press star then the number one on your telephone keypad. Your first question comes from the line of Frederik Willumsen from Carnegie Investment Bank. Your line is open. Hi, Martin Ravn-Nielsen. Thanks for taking my questions. I have a couple, so I'm just gonna take them one by one. First, I was curious if you could elaborate a bit on what dynamics are in place to cause lower demand or lower sales of houses. So is it primarily that the overall demand for new builds has decreased, or is it also a longer conversion time being a driver here? Maybe relating to the latter, do you expect that the potentially delayed or the extended conversion time has pushed part of the sales you were perhaps expecting for Q2 into Q3 or Q4? Martin here. Thank you again. We see a lower demand absolutely in and then we also is in a I would say historical situation compared almost to the financial crisis in 2008 and 2009 and so on. It is extraordinary for now. The demand for the customers is for a period here stocked up and therefore the visibility for now it is extraordinary low. It is actually what we're seeing into now, and it is also what we see about the real estate the sales around that. There's a lot of things that will go that way. Therefore, a lot of private customers, actually, do stock up for a period. When it come back to a more normalized situation, it is very difficult to say. Actually, nobody can say it. Therefore, we all the time have to make the adjustments in our organization, so it is reflected to what we are seeing into the future. We have proved that, you can see in two times before earlier in this month in this year, and we also do it again. Therefore, we are on top of also adjust our business to the demand and our business model also with outsourced construction is now showing our advantages here. Right. That makes sense. Thanks. You also mentioned that the guidance downgrade is partly due to delayed effect of sales price adjustments, and that we should expect these sales price increases to positively impact margins in the second half. Could you maybe elaborate on what level of margin expansion we should look for in the second half? It is a bit difficult for us to say because as the visibility also around a lot of costs, also the energy costs that we're looking into. It is a bit difficult for us to give an exact margin. What we're looking into for now is that the price increases that we have done to the backlog that we will deliver on here in H2, it will be better than we have seen in H2. There can come some extra costs as we have seen. Therefore, we also around our outlook here is in a phase actually now that our visibility is very difficult. Also, just to elaborate on if we are coming on around mid-guidance for the outlook here, it is the second best result in the history here we have in HusCompagniet. Right. Okay. Yeah, that's clear. I know that there is some inter-segment allocation playing into the margins on detached and semi-detached. Could you give us an idea of what the underlying margin is on semi-detached projects currently? Yeah. I think the margin, as we've said in the past, are still very much equivalent to our detached business. Our semi-detached margins are of course seeing some of the same effects, but the underlying margin in our semi-detached is still very healthy. You should assume that it's on the same level as detached, cleansed for the intercompany elements. This quarter it would probably be a little bit higher, but you know, nevertheless, that's the level we're seeing. Just for my final question, I'm looking at your order backlog and trying to get an idea of what we can expect of cash conversion from your gross order backlog. Could you maybe fill in the blanks here? If I take your gross order backlog and assume an EBITDA margin of let's say 9.5%, can I use that as a proxy for the cash flow we can expect from your order backlog, or should I multiply that by maybe a 50% cash conversion rate? Yeah, I think the methodology there is absolutely correct, right? I think it is, of course, you should still apply our cash conversion rate in this instance, because we are guiding sort of these at least for now about 50% cash conversion, and therefore I think it would be prudent to use that assumption as well on the margin. You can do that's a good proxy for sort of the cash flow generated in the business. Okay, thank you so much. Thank you. Thank you, Frederik. Your next question comes from the line of Claus Almer from Nordea. Your line is open. Thank you. Yeah, also a few questions from my side. The first goes to your new guidance. I can see all the assumptions you're mentioning, but maybe more color to this. What if Q2 is repeated rest of the year, what would that do to your 2022 performance? For example, if we're seeing gas spot, I think what we saw in Q2, I guess it was the beginning of Q2 and in March, right? If that is what you're reflecting, if we start seeing these immediate surcharges, things like that coming, that would hit our business. No doubt about that. I think what we are seeing today is that there is a lack of gas supply, right? This is sort of when we start seeing that Russia is cutting gas to 20%, it hits the gas prices. If you look in the newspapers, at least here locally, which most of you are from, then it's clear that the electricity prices yesterday was the highest we've seen. I don't know for how long. Of course, we're also getting some of these. That is actually something we have counted in. What we haven't counted in is this geopolitical gas if China suddenly invades or it's probably another way China would put it, but if they go into Taiwan, then of course these kind of things with no semiconductors et cetera, those are not included as per natural right. We have foreseen this, what we know today, that is what we are taking in, and this is that the gas prices are increasing, and we've gotten more gas, material increases et cetera also lately. I think the main reason for our decrease in outlook is the same. I just wanna make that clear, Claus, sorry. Just to be very clear around that. Our sales have- Say it one more time. Sales? Yeah. The sales. Yeah, the sales, right. Because it's hurting our WIP. You're not seeing a big effect in our deliveries. Remember that the main effect we're seeing is the sales we're doing and have done the last few months. Those will mainly hit our WIP, so work in progress, in 2023, and those are also hitting our results this year. Those has been on a different level than we expected, and those are then impacting our business. Of course, the rest of the year sales are less into the WIP, and therefore there's a less risk of that effect coming in moving forward. Okay, let me just try in another way so I understand these. What I hear when you do the presentation today, I hear you, margin has dropped in Q2, things will be better in the second half. Just trying to understand the thinking behind the change of guidance. Is the revenue for second half already secured in the backlog, so there's no real exposure to the sale of houses in the next six months? Secondly, on the margins on your deliveries, is this based on the current sourcing level of sourcing? Of course, I can understand geopolitical, there might be some changes due to that. From what we see today. First, is this all in the backlog? Second, is it based on your sourcing prices today? Is that what is midterm, mid-range of your new guidance? That would be probably the question. Correct. On both. Okay. Good. I can understand at least. The second is about the price increases you're talking about. How sure are you actually that, obviously, we can always raise prices, but how sure are you that higher prices will not have a negative impact on the number of houses sold? I mean, in a situation where you don't sell a lot of houses and then you go out raising prices, normally it's not a good mix. I think if I first take, Martin can explain sort of, but I just think when we said that the ASP will increase, just so that is clear, if that was also part of the question, Claus, it was uncertain to me. If it's the ASP that will be rising moving forward, those are price increases already sold to customers and therefore you're seeing the effect of those price. We just, to be clear on what we talk about on the ASP of the order book, right? Those are at higher levels. Then of course, the question around whether continuous price increases will then hurt the sales, then Martin you can- The prices that we have now, again, against the customers is reflected in what we are looking into our cost for now. We don't see any further price increases, so far. We are very focused on our margins. It is very important for us that we secure our margins. We don't see actually now that we are losing more sales to our competitors that we normally see. We actually just see now there is no customers. You know, the customers' level is very low. Over time, we also can see maybe that HusCompagniet is a safe haven. Maybe we can see that despite the situation, we also can gain market share. I can tell you, we are on top of that all the time to have the right prices. Just to be clear, we don't see that we are losing more, you can say, market share than we normally do. It is actually because the customers are not there on the same level. Okay. That I understand. I know you have this, you know, and rightly, very strong focus on protecting your margins. I guess in these very uncertain times, then it will be the customer setting the price. Isn't there a risk that being very strict on getting the right margin on your sale that no customer will actually sign the papers because everyone can read the newspaper, see that house prices should go down? Why not just wait a few quarters? Yeah. You're right. If we are, you can say, decrease our prices with 1% or 2% and so on, it is not what we are seeing that it can increase our sales. Because actually, the customers for now is waiting. Of course, we will monitor it all over the time because yes, maybe it can be a period where it can be the right business case actually to have maybe 1% lower margin and therefore some more sales. It's not what we're looking into for now. Just a final question, and I hope you will give some color on this. Whatever we're seeing at the moment, as you also said, this will mostly have an impact on 2023, and I know you haven't given any guidance for next year, but maybe you give some indication or color for how should we think about next year? Yeah. Claus, this is, of course, the million-dollar question, right? I think that at least I think we can give so much flavor that clearly we are seeing less sales. Those will hit our business in 2023. I think that goes without a question. Then I think what is moving, at least for now, in our favor is of course that, cash flow-wise, then if we decrease our business, that's normally have a positive effect from that perspective. Our ASP is moving up. If we look at the subcontractors, at least it looks like that the activity around subcontractors is much less and that if that has happened and we look back from the financial crisis history, et cetera, that will have a positive impact on our margins. I think, as you said, we are not guiding on our 2023 for now, luckily enough, because that would be hard. We expect to see less activity than we have seen in 2022. I think that's hopefully very clear. We also expect that we will be able to preserve our business and deliver a very still solid results, but not in the level of 2022. That at least not our expectation overall. I think that we have to say. Just to comment, historically, also before actually we were listed, we are very good to prognose and make some budgets that we can see all the time what we do deliver year after year, and we are succeeded to deliver what we have had in our budgets. It has been a part of our, you can say, way all the years actually. Also last year. This year, 2022, it is absolutely extraordinary. Therefore, we have now, and I'm very glad about that because it is not normally at all for us, but we have now made some other guidance that we provided in November, and therefore going out now and give some guidance around 2023, it wouldn't be right. I totally understand. You know, it is very uncertain times. It's more, yeah, just some color. That is fine. Maybe just a final follow-up, and I was a little bit late to the call. The change of guidance for semi-detached. Why is that actually? Because you have the backlog, and hopefully the availability of construction workers, it will improve. Why is it that you might see DKK 50 million less revenue this year? I think that the reason why we are taking deliveries or opening to take deliveries down a bit, and similarly that as well, we are seeing congestion around these subcontractors. It is normalizing in Jutland and Funen. Zealand is prolonging, and I think we have to be honest that our predictions have been too optimistic before. I think at least we are opening up to that potentially some things are moving from December to January, et cetera. We typically have still a lot of activity in Q4, especially we see that in Zealand. In Zealand, if things get too congested, we would potentially prefer to move things into January just because or else things are gonna get too hasty and it's still more difficult to ensure quality, et cetera. Unless we feel that we will be willing to take some of these revenues and a little bit of earnings into January, February. I think that's the reason why we're doing it, Claus. It is very much the congestion around subcontractors in Zealand that is the effect you're seeing on those two elements. Fair, fair enough. That was all for me. Sorry about all these questions. Thanks. No problem. Thank you, Claus. Thank you, Claus. You have further questions from the line of Frederik Willumsen. Your line is open. Hi. Thanks again. Just a follow-up. There's some distortion to the line, but Martin, I think I heard you saying that you're losing sales to competitors or you're not losing more market share than you usually do. Could you maybe just state if that's correctly understood? What we are looking into, we don't lose market share. You're not losing sales to competitors? It is actually the same picture that we have seen. So what we also have seen that is just not the amount of customers, the number of customers is the half, but we are not losing essentially more to the competitors than we are doing now. Maybe going forward, we can see that we are the safe haven and can gain the market share. That is what we're working for actually. Is it too soon to say if you're already gaining market share or what are you seeing right now in that regard? The statistic material is with a lot of delay actually in Denmark. We don't have the clear numbers, so we can't tell you about that. It is also what we are using. It is our internal data that we can see how many contracts we do sign and how many we lose and so on. We have data on that and what we're looking into for now is that we don't lose market share. Okay. Thanks for clarifying. That's all. Thank you. Thank you, Frederik. As there are no further questions at this time, I would like to turn the call back over to Martin for closing statements. Yes. All of you, thank you for dialing in to this call from my end and Mads and then have a nice day. This concludes today's call.