Good day, and thank you for standing by. Welcome to the NKT Annual Report 2023 Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star one one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one one again. Please be advised that today's conference is being recorded. I will now like to hand the conference over to your speaker today, Claes Westerlind, CEO. Please go ahead. Thank you, and good morning, everybody. Thank you for calling in to listen to today's presentation on the annual results for NKT for 2023. If we go to the first slide, just before we head into the material, I want to draw your attention to this slide, explaining that, both the words coming out of my and Line's mouth, together with this presentation, will contain forward-looking statements. My name is Claes Westerlind, and I'm the CEO of NKT, and has been so since May. Next to me, I also have the second speaker of today, Line Fandrup, who is the CFO of the company. If you start from a high level, reflecting a little bit about the annual results for NKT for last year, this is a result that we are proud of, and I think it honors the employees of NKT. It honors also our customers and other stakeholders. It's a testament to the journey that we are on for the moment, and I think it also serves as a proof of what NKT is capable of doing. Looking into the bullet points here, it's shown by a heavy organic revenue growth of 36%, primarily driven by the solutions and applications business lines. We exited last year a record year from a market perspective, and I will come back to that later. And also from a success perspective of NKT, where our order backlogs stood at just short of EUR 11 billion after a record annual order intake of EUR 7 billion. Our operational EBITDA stands at a very decent level of EUR 255 million. This is the highest annual level for the company, and it's also a EUR 100 million improvement compared to the preceding year. And last but not least, also our positive free cash flow generation stood at EUR 305 million, driven by, of course, the higher earnings, but also by the positive working capital developments coming from the larger high-voltage order backlog. So moving into the business lines and zooming in, potentially a little bit more on the quarter, the fourth quarter of last year. Some key developments here. We had a strong growth in the Solutions business line, both in terms of revenues and also the Operational EBITDA. This is driven by overall satisfactory execution in our projects, a higher activity level across the business line, both in Cologne and Karlskrona, and also that we were reaping some of the benefits from the increased capacity from the investments decided upon and executed in the last couple of years. The Applications business line continued to benefit from the positive sentiment in the power distribution grid segment, primarily impacting medium voltage cables, but also part of the 1 kV. In general, also the construction market kept on a fairly stable, albeit low level. Service and accessories increased in terms of revenues, despite the fact that we did not have any offshore repairs also in Q4, as was also not in the year in full, while the operational EBITDA came at a lower level, but this is also in comparison to a very high comparison period in Q4 2022, where we released some warranty provisions. All in all, if we look to the right there, this again, to reiterate what I said before, but looking at the quarter instead, led to a 40% organic growth in the fourth quarter and an EBITDA percentage development from 10.2 to 11.8, comparing to the same period in the preceding year. Zooming in on the solutions business line for the fourth quarter, as said before, revenue and operational EBITDA increased. Overall satisfactory execution, higher activity, and the capacity coming online from the investments. We made continued progress on several of our large projects, including, but not limited to, Baltic Power, BorWin5 in Germany, Champlain in the US, Dogger Bank C, and Shetland in the UK, and last but not least, also SuedLink and SuedOstLink in Germany. In addition to that, we also note that the investment program that we announced and decided in May last year continued in a good manner from a timing perspective, and the groundworks have started and commenced in Karlskrona. You also could note that we have also ordered the vessel from Vard now in the end of last year. Overall, leaving the business line with EUR 350 million of revenues for the fourth quarter, very high organic growth of 65% and more than acceptable EBITDA level of EUR 54 million. Taking a moment also to reflect on the market development. As I also said initially, it has been an extraordinary year from basically any perspective or dimension that you look at. Our estimation when we view the market from what we call our addressable market, our estimates are that the market volume exceeded EUR 15 billion when it comes to firm awards, so products that are being booked into the backlog. It's also our estimate that, around 90% of the awarded products were based on DC technology. NKT was awarded around EUR 7 billion of those, leading to a market share of roughly 45%, also very respectable. On top of the EUR 15 billion, there was also a number of long-term booking commitments allocated towards the market. Also those, as a coincidence, around EUR 15 billion, bringing the total market activity to EUR 30 billion for the year of 2023. And for the ones of us who have been in the cable business for a while, and the solutions segment in particular, this is a very, very high activity level, basically 10 times what the activity level has been if we go back five to six years. We see that the European transmission system operators, they were very highly active in 2023, and the activity showed through the framework agreements that were both awarded or the process that were initiated in order for them to secure long-term commitments for products that we are supplying from the high voltage Solutions business line. When we now look forward and try to make reflections about the market sizing in both this year and also the coming years, we have decided to communicate with you here today that we expect the market volumes to be above EUR 10 billion in average between 2024 and 2030. The reason we have taken this average measure is that these volumes can fluctuate year by year. Certain years it will be higher, and certain years it can also be lower. And to take one example of this is the 50Hertz agreement being awarded in the end of last year was around EUR 5 billion in total won by NKT to the biggest extent and one of our large competitors to a smaller extent. And EUR 5 billion, of course, is a massive volume from a single customer allocated to the market in one instance. And if such a volume would slip from, let's say, December to January, it would not make a difference for the cable producers or the market, nor would it from the customers, but it would make a big difference if you look into a fiscal period or from a market volume perspective. Then to the right of this slide, we couldn't help ourselves to put down some of the notable order wins that we are proud of, from last year, and also that honors all the colleagues in NKT, and also the customers that have worked hard to make them realize. Turning around and then looking at the NKT backlog, we can also see a favorable development, to put it in mild words, comparing to 2019 and, to date, we have had an eight-fold growth in the order backlog, which positions us with a very good earning visibility, in relative terms for the coming years. The backlog as such, the composition of it, you can see to the middle here, and that stands, in essence, unchanged from when we had this last discussion in Q3, whereby the absolute majority is with transmission system operators situated in Europe, and there's a smaller part with other types of customers, SPVs, or non-European. By application, the around half of it is in the interconnector segment, while 45% in the offshore wind segment and a minor part in, in the power from shore segment. The other aspect of this slide that I want to draw your attention to is to provide you with some level of, of visibility of how this backlog is distributed over time. We are also today communicating that around 26%-29% of the EUR 10.8 billion is set for execution in this year and also next year, and then obviously the remainder in 2026 and beyond. Over and above the EUR 10.8 billion euros of backlog, we also have secured another around EUR 2.5 billion of capacity reservations from the customer TenneT and also SSEN out in Scotland. Then coming to the applications business line, which has had a very good year last year. Q4 enjoyed a higher revenue based on basically an overall positive situation, and especially the power distribution grid segment. The revenue grew with 3% if you compare to the same period in the preceding year, and together with some efficiency initiatives and the results of those, the EBITDA margin ended up with 7.1%, and that's an increase with 1.2% if you compare to the same period in the preceding year. It deserves to be mentioned that the full year operational EBITDA margin for applications stood at 9.2, which resonates very well with where we think that this business line should be. I also, again, want to emphasize what we have said before, that the part of the applications business which has the connection to construction activity, the revenues connected to this segment were continued at a lower level, albeit now more stable, both seen from Q3 to Q4, but also if you compare Q4 last year with Q4 in the preceding year, actually a slight increase. This left the business line with revenues of EUR 149 million, the organic growth I mentioned, and an operational EBIT of EUR 10.5 million. Coming to the service and accessories business line, enjoyed a growth in revenues despite the fact that we have not had any offshore repairs during the full year, last year. The other segments of the business lines being both the accessories business but also the sustainable service business, continued to enjoy a positive development. In the accessories part of the business, that's primarily driven by the increase and ramp up in delivery of HVDC accessories supporting the solutions business. The operational EBITDA, as I said before, was lower than the same period of Q4 in 2022, and this was primarily driven by a warranty provision release that was made in 2022. The profitability was also impacted by the business line, by some temporary higher cost within the accessories business. And those were in relation to warranty provisions taken for some rectifications of products that have been delivered in the past, and also some inventory write downs. The business line as a whole for the quarter left the year with EUR 53 million of revenue for the quarter, an organic growth of 2% and operational EBIT of EUR 3.5 million. And last but not least, before we head into the financial numbers, I also just wanted to take a moment to reflect on sustainability, an area that is, paramount to NKT and also society as a whole, where we, in our opinion, also continue to do good progress, on this journey, and especially our decarbonization targets, but also the wider parts of the, of the ESG agenda. As you can see here, the total Scope 1 and Scope 2 emissions when we closed the year of 2023, we had a 77% reduction in comparison with the baseline year of 2019, and this confirms the trajectory that we are on towards reaching the target of -90% in 2030. You can also note a slight increase compared to the preceding year, which is well in line with our expectations, also, that we are now enjoying a much higher activity level inside the business. Scope 3 emissions, we note a decrease comparison to the preceding year of 24%, although compared to the baseline year, we have an increase of 28%. And again, the same comment applies there. This is not unexpected and connected to the fact that NKT is growing. On a point that we are not proud of is the safety results of last year, where we had an increase in the total recordable injury rate to 1.52 from 1.13 in the preceding year. This is by no means acceptable, but you can rest assured a lot of work has been done last year, albeit this is not visible in the end result numbers, and more rigorous work will follow during this year. We can see that an absolute majority of our incidents are driven by behavioral aspects, and this is something that we are now also firmly addressing in the year to come. We remain determined to reach the target in 2028 of less than 0.6. In fact, the vision we have is something that we all should and must have, and that's that zero people should get injured working for NKT or for any employer for that matter. Diversity and inclusion. One of the metrics we apply is the perception of our employees, how much and active we work within this dimension. Here we have a target to reach a 74% score in internal surveys, and last year, we record a 76 score. So meaning that our people do recognize the efforts that are taken internally to become an even more diverse and inclusive company. Recycling rate, we are on a good path towards the target of more than 90% of recycling. The development from 2022 to 2023 stands at 78% and up to 83%. So overall, I just want to emphasize how important sustainability is for us at NKT, and also, as I hope you recognize, we are making progress also within this discipline. And with those words, ladies and gentlemen, I hand over to our CFO, Line Fandrup. Thank you very much, Claes. In the financial highlight section here, I'll start off with the income statement, focusing primarily on the quarter with a few comments on the full year development also. Overall, high organic growth with positive contribution from all three business lines. It's we are up with 40% in revenue growth and it follows a strong performance for 2023 as a whole. Our operational EBITDA also increased materially. Our EBITDA margin is up by 1.6 percentage points. If you look below EBITDA on depreciation amortization, the Q4 particular was up slightly compared to previous quarters. On the financial items, you'll note EUR -8 million for the quarter compared to EUR 14 million of last year. What you need to beware of here is the underlying elements of we actually have the total interest line was positive due to our cash position. So we're up around EUR 3 million there, while we on our, on the currencies in general, FX gain losses, we were having unrealized value adjustments of our assets, liabilities, and our hedges. And this is due to the Swedish krona strengthening against the euro in Q4. We actually had a gain on realized hedges of EUR 3 million that was settled in the first part of Q4, when the Swedish krona was weakening. On tax, our reported tax was low in Q4 2023 due to various adjustments of the year and the quarter. But if you look on it on a full year, you'll see that our reported tax rate was around 20%. All in all, this led to a EUR 20 million improvement of our net result. And if you look to the full year, you'll see a more than doubling on net result compared to last year. Just a comment here also to the employees, very important for the growth of the year, but also certainly on what we are planning in the years ahead. We are hiring in more and more people to utilize this. So you're seeing the uptick there also. Turning to the next slide, some highlights on our cash flow. Continued positive cash flow generation, driven by higher earnings and improved working capital positions. So if I start out with a strong cash flow contribution from the operating activities driven by our EBITDA development, but also very much our positive contribution from the working capital, primarily due to milestone payments in our solutions business line, as we execute on the projects in our backlog. Further, I'd say a positive contributions also from applications. And you also note that in Q4, our investment program is really kicking off even stronger. This is very much, of course, due to the order of the new cable laying vessel. But also in general, we are executing as planned on our activities. In total, for the quarter, we had a free cash flow generation of EUR 23 million, but on the full year, we had a tripling of the free cash flow generation compared to 2022, so also very solid in the current activity level. Our cash flow from financing activities was slightly positive in Q4, but the major part of the 2023 full year is, of course, the capital increase that we completed in Q3 2023. Turning over just to a few highlights on the balance sheet here, already mentioned the working capital development. This combined with the strong EBIT generation, meant that our ROCE went up to 19.5%. It's a very solid level, as you also, if you compare against our medium-term ambitions, both for 2025 and 2028. What you need to note, of course, is obvious our EBIT level in general will increase with the increased earnings of the companies, but it very much also depending on the flow and the development within working capital, how the dilution of the year would look and the capital employed, the need. Our net interest-bearing debt is largely unchanged from Q3. The positive cash contribution was offset by increased leases relative to some of our sites. However, compared to 2022, we've seen a significant decrease in our debt level due to the cash flow generation and the capital increase. We have a strong liquidity position at year-end, with liquidity reserves at EUR 1.1 billion. And this, of course, we still have a large investment program in front of us. You recall probably the wording around investment program being bell-shaped, meaning this year and the next year, we will be at a high level on investments in general, and then it should be coming down on that investment program beyond. What you also see is our issued guarantee lines is coming up, comparing in 2022 with EUR 1.2 billion to now in 2023 at EUR 1.9 billion. And this is, of course, due to the execution of the backlog and the guarantees we post against the different projects towards our customers. We then flip to the last slide of the financial section here, the financial outlook for the year. Continuous growth in revenues and earnings uptake. Just to mention a few comments to this, as you also note when you have time to go deep into the financial report of the year, we expect to improve our financial performance again in 2024. It's revenues of EUR 2.21 billion-EUR 2.36 billion, and an operational EBITDA of between EUR 285 million-EUR 335 million. The main growth driver of 2024 is solutions. You have seen us come online with the capacity expansions in both Cologne and Karlskrona, and this will have a 12-month impact up in 2024, which is, of course, a strong contribution into this year's expected financial performance. And we have great visibility, as Claes mentioned, on our backlog, which means we know what we will be producing this year in the solutions. Applications and services and accessories also should contribute positively to the continued development delivering on the outlook here. And not to mention that in 2024, our revenues in solution will have a positive impact from a relatively high amount of subcontracted revenues. This is expected, this level of subcontracted revenues, to come down again in 2025 and 2026. So I think this is an important dynamic on the financial performance you need to reflect about for the solutions business line. We're also getting positive impact from the investments in the past years in solutions on the uptake here. And what we also want to mention, and maybe a new phrasing, but when we talk about capacity, we actually measure it in number of machine hours. What you should think about is when now the capacity is online and we're working on further capacity, but which is only coming online beyond 2026, that means that the machine hours of NKT Solutions business will stay largely flat over the years ahead of us. So we should gradually see the uptake later, but this is as expected, and this is also the assumption that is underlying our medium-term financial ambitions. So there's no news in this. We're just trying to be a bit more explicit on what we should expect here. So we're ramping up our business to grow. You see, we're taking in more employees to secure the years ahead of us, and this should really also expect that we will see a trajectory on our cost base with a certain uptake to cater for the growth that's coming. I just want to go through, bullet by bullet, the assumptions of the outlook, the satisfactory execution and development as needed. Stable market conditions around applications, normalized offshore power cable repair work activity, a stable development of the global economy, stable supply chain with limited disruptions, and the needed access to the required labor, material, and services, and then a stable development in foreign currencies and metal prices. So we look forward to yet another exciting year in NKT, for sure. Just going through the highlights again, a year of significant growth with a 36%, driven by both solutions and applications. It's a very high order backlog we have of EUR 10.8 billion, with a very strong order intake of EUR 7 billion for the year. An Operational EBITDA of EUR 255 million, a company high, and EUR 100 million up compared to last year. And then tripling our positive, or our free cash flow generation compared to 2022, we stand at EUR 305 million when we close the year. With that, we will hand over to the question- and- answers. Thank you. As a reminder, to ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. Please stand by while we compile the Q&A queue. We will now take the first question from the line of Casper Blom from Danske Bank. Please go ahead. Thank you very much, and congrats on a strong Q4 and great guidance for 2024. I have a couple of questions, and I'll just take them one by one. I'll limit myself to three. But first question goes to the cash flow outlook. You don't really give a cash flow outlook, but could you give us any indication to how much CapEx we should expect for 2024? And if you could split that into the, I would say, new investments and maintenance. And secondly, on the cash flow, if you could give any kind of guidance on what we should think about net working capital. As I understand it, you are still waiting for some prepayments on some of the orders received in 2024, but, but any insight there would be very appreciated. Thank you. Thank you, Casper. Line here, and good questions. Thanks. So on the CapEx for 2024, I think I'll separate it exactly as you do with new investments and then, let's say, maintenance, but also the other business lines, so to say, in our technology, not to forget. So when we talk about the EUR 1 billion investment program, you should think that it was at a slow start in 2023. So the major part really of that will come in 2024 and 2025. And I think you can do a math on that that is significant above what you have seen currently. On the running phase of maintenance and technology, we've previously said around when we are done with the capacity expansions, between 80-100 million EUR a year, depending on, let's say, how the years unfold. So I think you should take something like that also for 2024. Net working capital, you know, when you get EUR 7 billion of orders, it's a pretty impressive year in terms of the working capital. But actually, as we execute also on some rather large project continuously now, I think you also should expect a positive net working capital in 2024, in similar levels, maybe I should say it like that. So just to be sure I understand, would you say that the change in working capital would be the same in 2024 as in 2023, or that the absolute working capital would be at the same level a year from now? The absolute level, so the latter. Okay, understood. So a flat impact on the cash flow, basically. It is very dependent, of course, on order wins. If you come back to that question, you probably note that how exactly 2024 will develop in terms of order wins. There's a lot still to be guessed and said about that, so we also have to see how the year develops. Okay, understood. Then my second question goes to Solutions and the capacity that you also touch upon. As you mentioned, you have a fairly high part of subcontracted revenue here in 2024, as I understand it, also in 2025, relating to the Champlain project. As that levels off and becomes nothing in 2026, will you then be able to basically keep solutions revenue flat in 2025 and 2026 on the back of higher pricing? Yeah. Thank you, Casper. It's Claes here. I will give it an attempt to answer your question, and Line can also fill in more. I think the statement we are making here is basically, as Line said, the machine hours, basically, the investments that we have done over the last couple of years have now, in essence, all become operational. And going back to what Line said, that will keep the machine hours constant in more or less over the next couple of years. That means 2024, 2025, and also 2026, until the new factory comes online. So the revenue capability based on internal resources will be constant, more or less. Of course, this depends on what kind of mix do you have? Is it aluminum? Is it copper? So there are lots of different aspects that you can inject to this to get different numbers, but overall, that's how it's gonna be. On top of that, what Line referred to, the Champlain product in particular, this is where we have a lot of subcontracted scope, but it's well known that we are also utilizing Southwire for external cable production there, and also installation activities are extensive. That will be a big part of the year, this year. This will tone down going forward, as also said before, and this will tone down in 2025 and 2026. So we are trying to help you a little bit to come to the conclusion that overall, what we have said about CAGR for the company, the reference year to 2025-2028, still stands. But I think it deserves to be mentioned that there is a negative sentiment from a revenue perspective from 2024 heading into 2025 and 2026, which is nothing that we haven't planned with. This is fully in accordance with our expectations, but it's, I think, our perception that we may not have been clear enough about this in the past. Line, I don't know I appreciate the transparency, but I would add then, is it fair to assume that while you have that negative impact in 2025 and 2026 from less subcontracted revenue, then there should, all else equal, be some sort of positive impact from working through the backlog towards higher projects with a higher average price per unit? And secondly, also a positive impact from a better productivity planning as you have this transparency on the backlog. Is that a fair assumption to have, that you can at least partly mitigate that lower subcontracted revenue? I think the mechanics of what you're saying, I wouldn't say that they are false. What I do think that I want to add as a nuance there is the length of the existing projects. So the tail, if you will, for how long will the legacy projects be with us for the future? And I think they will be with us for some time. So this year we are basically executing on similar products as we did last year. And as you're right, in the perspective that we will gradually change over to new projects over time, but it will not be enough to compensate for the negative incentive coming from the lower external revenue coming from subcontracting of installation and also cables in 2025 and 2026. So the tail will be with us for a longer period of time to be able to compensate for that. Understood. That's all for me. Thank you. Thank you. Thank you. We will now take the next question from the line of Daniela Costa from Goldman Sachs. Please go ahead. Thank you so much. Actually, if I may start with the I'm not sure I kind of completely got the legacy commentary now on your last question. Were you talking about very specifically the legacy subcontracting, which I guess your message is, you know, it's gonna come down in 2025 and 2026? Or were you talking about those legacy backlogs that have impacted margins as well in the quarter? Because I know in the statement you talk about some legacy, some charges and provisions that you had to do for legacy contracts. Those are done, or will there be further impacts? Yeah, it's a good question that we clarify that, Daniela. So it's totally unconnected to the last point made by you, to the legacy onshore projects that we talked about in the report. This is a totally unconnected area. This is about what we typically have a discussion very often in both calls like this, but also individual talks. When does NKT come into execution of the products that have been acquired within the last 12 to 18 months? And you know, for how long will the legacy products that we have acquired from 18+ months ago be with us? And this was the comment I was making. So the positive impact from a revenue perspective, from products with better pricing than what we have in the past, I think Casper's question there was, could that compensate for the shortfall that we would have in revenues? Coming from less subcontracted volumes, and my answer to that was no, because the legacy products will be with us for longer time than when we will start seeing that Negative information. Was that clear enough, Daniela? That was clear enough. Maybe you can also follow up on those projects that have been impacting the margin, which is a separate issue, but can you talk us through those legacy? This, this was an isolated thing, or are there still things in the backlog related to those? Yeah, if I understand you right now, you're referring to the annual report and the solutions comment. Yeah. Yeah. Yeah, Yeah, it is an isolated thing. Hello, can you hear us? Can hear you, yes. Yeah. Sorry, sorry. It is an isolated thing. These are products within the segment that we define there. It is products which have been produced in a specific time period, where we have, like in any product business, sometimes you come across non-conformities that requires you to act upon them. And discovering that now in Q4, we have made provisions for what we think are the likely needed remedies, that we see will be needed going forward. Okay. And just one final one for me. In terms of your ROCE is well above the medium-term target of over 12%, as at 19%, I believe, in annual reports. I mean, given all the things that you have mentioned, how should we think about that? Is the 19% sort of a bit of a one-off, or do you see that as sustainable? I guess you haven't changed the target, so can you re-reflect a little bit on that, please? Line here, Daniela. I think how you should reflect about this, that our medium-term ambitions still stand, including the ROCE ambitions of those years. Which, which means underlying, of course, that the, the, the EBIT is gonna improve year-over-year, but where you'll see the capital employed is gonna fluctuate. And this year it's at a very, it's at a lower level, generating the 19.5%. But depending on the net working capital and the investment programs in the coming year, that can be, it can be very different. So we stand by our medium-term ambitions, and, and that's what you should kind of assume. And sorry, if I may, one very final one. On the subcontracting point, in terms of mix on percentage margin, how does that impact you? It's, it's sort of a positive, the subcontracting getting off, or? Okay, can you hear me? Yeah, Daniela, sorry, I had a trouble to get the question. Could you repeat the question, the subcontracting? I think it was pretty clear what you mentioned on the revenues from subcontracting sort of being high in 2024 and then sort of lower in 2025 and 2026. But on a margin percentage, how does that impacting... How is the margin of the subcontracting versus the total? We don't foresee a big impact from that, clinging off, neither positive nor negative. Okay. So subcontracting is at similar margins to your own? Like I said, you know, with all the moving parts we have, when that comes down, there will not be a visible impact on the margin on what we will look at in the coming years. Got it. Thank you. Thank you. Thank you. We will now take the next question from the line of Kristian Tornøe from SEB. Please go ahead. Yes, thank you. I have two questions. Firstly, on these provision to legacy onshore projects you mentioned in the annual report. Given that you're talking about legacy onshore projects, I assume we are not necessarily talking big numbers here. But can you just reassure us why this would not have any impact on sort of your current onshore or offshore projects, for that matter? Yeah, I think I remain with my earlier statement there, that it was connected to products produced in a specific time period. And as I said, it is legacy, so it is connected to what has been produced in the past. And we have made the provisions for what we believe is the more than likely cost in conjunction with remedies connected to this, these non-conformities. I also want to add there, that it is they have been deemed not material from a group perspective, going to the size of the provision itself. All right, understood. And then to your guidance specifically for applications, what you assume, because obviously what we've seen throughout 2023 is a declining margin. So going into 2024, is it sort of the run rate you've seen in the second half of 2023 you are assuming to continue? Or how should we think about the margin in applications for 2024? I think, Kristian, you should reflect about application overall for the year, a stable development. That's how we have made the guidance. Yeah, and I think maybe also just add a reflection there that the applications business line also, as Line talked about, some of the prerequisites is that the market continues in a similar manner than what it has been. But from also seasonality perspective, the applications business line is impacted by, let's take an example, the first quarter of a year entails the month of January, a lot of holidays, harsh weather conditions, obstructing installation possibilities, so therefore, typically would not be a strong quarter, and you could argue the same for also the fourth quarter, connected to Christmas, harsh weather conditions, et cetera. So there will be seasonality fluctuations for the applications business line, while when looked at the full year perspective, we are leaving a successful year behind us. Sorry, maybe I just didn't completely understand what you're saying. So we should expect a margin which is somewhat similar to what you did in 2023, assuming markets remain as you expect and so on? We, as you're well aware, we are not guiding per business lines. We are guiding for the overall group. What we have said in the past, and then also I've used the words that we believe, you know, a high single digit margin% is a worthy profitability of the business line. Understood. Great. Thank you. That was all for me. Thank you. We will now take the next question from the line of Claus Almer from Nordea. Please go ahead. Thank you. Yeah, I also have a few questions. I will do them one by one. The first question goes to your CapEx, or sorry, market activity guidance of this minimum EUR 10 billion per year average until 2030. If I do the math and assume, let's just say, you got one third of the market, then you will not have enough capacity, even with the new factory coming on stream. So what's your reflection on this? That will be the first one. I think there are. Thanks, Claus, and it's a very relevant question. I think it's fair to say that we don't anticipate to have the same market share like we had last year, for many different reasons. There are more players than NKT out there, and also, our capacity is of course constrained, that we are victims for our own success, if you will. Having that said, there is a lot of uncertainties connected to exactly what the markets, market volumes will be. And going forward, of course, now, right now, we are expanding at the pace which we feel are prudent for NKT as a company and something that we can lift, both from a financial perspective, but also human capital perspective. And obviously, we are also reflecting about the period over and beyond 2027, 2028. What are the next steps for NKT? And there, we have not made any final recommendations or reflections that we are prepared to share with the market. But market share percentage per se is not the primary driving numbers for us. What we are doing is trying to be prudent in the growth pace that we are enabling for the company, and also ensuring that we can fill and utilize the assets that we are building. And those are the main priorities, including also having the right risk-reward balance in the products that we acquire. I might be a bit slow here, Clarence, but that I didn't really understand. So does that mean you're not going to add more I guess you agree on my math, that if minimum EUR 10 billion plays out, you don't have enough capacity, if we just assume not a 23% market share, but a more normal market share. And if that's the case, does that mean you are not going to, you know, meet the market demand, i.e., not adding more capacity? Or how should we think about this in a longer term perspective? Yeah, I think in the longer term perspective, I'm not ruling out anything. I'm not saying that we will not add capacity. In the short term perspective now, and what I view with short term is up to 2025 and also 2028, there we will stand by our growth plans as they are. We should also keep in mind that NKT is not the only cable manufacturer who is adding capacity. So there will also be others growing, as you are well aware, Claus, also our largest competitors and also some competitor that are established them in Europe. And for the business as a whole, of course, our prerogative as a cable supplier is that the demand should be on the right side of the supply capacity. That, we feel, is the case for the moment, and that is also what we want to make sure that it stays that way. So when you go out with this guidance for our target or market view until 2030, you know, given the history, I think you are pretty confident this is also what's going to play out. So when will you, you know, be ready to either say, "Okay, we are happy with our current capacity, including a new factory," or, "We are going to add more capacity so we can meet the market demand? It's a good question. I understand why you ask it. I'm afraid I have to disappoint you a little bit. I cannot give you a time point when we will come out with reflections of the strategy period over and beyond 2026-2028. This is something that we are reflecting on internally, and when we are ready, then we will come out and communicate with yourselves. For now, we are very much focused on sticking with our current plans and executing on the existing capacity increases, which is a substantial effort for NKT, both from a, especially from a human capital perspective. It's about striking that balance between pace of growth, you know, meeting the market requirements, but also doing it in a way so that we can carrying it in a safe and sound way. Fair enough. And then my second question goes to the 2024 guidance. What assumption have you made about provisions as to the German Corridor projects and the Champlain project? So is that the same performance that you had in 2023? Is it on a conservative assumptions? Yeah, any color on that would be helpful. Thanks. I think the best reference point here, though I know you're looking for something more detailed, is we plan to the guidance for 2024 is planned on a good execution in our solutions business, without any major disruption. Meaning German Corridor, Champlain, everything coming through as we are now planning it. But is that a different assumption than you had six months ago? I mean, looking at pre-guidance upgrade in 2023, you know, the start up of these projects must have been, you know, good, and with no hiccups. And is that do you assume this will continue in 2024? Or, you know, who knows what will happen in 2024, therefore you are taking a conservative approach to how things, how production will play out this year. I think when we just look at the company overall, our approach to the guidance is our best estimation based on our plan, and that was the same for 2023. And you're right, some of the projects we had in our portfolio of execution in 2023 were new at that point in time. And that both contains, let's say, risk mitigations we didn't foresee, and upsides we didn't foresee. And that's the nature of this business. Yes, we have been more experienced with the projects we have in the portfolio of 2024, but it's still a lot of cable kilometers on these projects that have to come through. So, yeah, I think that's how I would phrase it. I know, and I agree with Line. I I think there are, of course, both aspects in the products you mentioned, but also in many other dimensions of the business, which could cause, you know, our result for this year to end in the upper part of the guidance. But there are also many different moving parts that can move us towards the down part of the guidance. And when we look at providing a guidance, we look at, you know, the projects, we look at the business as a whole, together with the other business lines, and we have also upside and downside scenarios. And based on that, and a reasonable business perspective, that's how we provide the guidance. And I can understand, and I, I follow your reflections on last year, and of course, it is easy in the aftermath to reflect that something is conservative when all most things have gone in accordance with plan. But of course, you could easily also be in the opposite situation, where you end up within the initial guidance easily, as well as you would expect, if there is a balance between upsides and downsides. And, and we know that this is the product business. Things will happen, that, that we know for a fact, but as we also know, it's our job to constantly be on the forefront and act upon all risks and all opportunities, and that's what we also will continue to effort this year. As Line has said, Claus, we understand it's not maybe a crystal clear response to yourself, but this is also how we are thinking about the business and how we are planning for the guidance. Ah, that's fair enough. You know, having followed the company for quite a while, we know that there might be some hiccups down the road, so all good. That was all from my side. Thanks. Thank you. Thank you. We will now take the next question from the line of Akash Gupta from JP Morgan. Please go ahead. Yes. Hi, good morning, everybody, and thanks for your time. My first question is also on high voltage business. So I see, Claus, that you have increased the market volume outlook to more than EUR 10 billion average, and that's higher than what you guided in 2022 Capital Markets Day. The question I have is that how much of this market increase in our market outlook is driven by inflation, that the same cable might worth a lot more, given the inflation in last couple of years? And how much of that is underlying increase in margin, underlying increase in market, given the energy transition is gathering pace, and I think more and more customers are realizing that they need cables sooner than later? And then on a follow-up to that question is also this EUR 10 billion: Is this market in constant metal price, or is it in actual metal price? So that's to start off, and I have a few more. Thank you. Okay. Yeah, starting to reflect on your first one there, Akash, it's a good question. I will not give you a defined split on the difference there, but I would say that the primary part is driven by activity levels that we see. And again, I wanna reiterate what I said before, we are turning to an average value per year, knowing that things can easily swing both up and down, and I think last year was an excellent proof of exactly that. But you should see it as a reflection of an increased market activity, more so than the prices are improving. And then, is this in constant metal price or actual metal price, more than EUR 10 billion? It's an actual market price. Okay. My second one is on the technology innovation in high voltage. So we used to have 320 kV, and now we migrated to 525, and almost all of the projects that I see in your and your competitors' backlog, the newer ones are on 525 kV. I mean, where, where do we stand on the new technology innovation, where we increase 525 to maybe 600 or more, which can allow more power transmission through the same cable and probably allowing you to increase the revenue per kilometer and given the higher voltage? And anything, anything on that in terms of when do you think that we might go above 525 kV in the foreseeable future? Good and relevant question. I will not be able to give you timelines more than that. We take innovation seriously, also suggested by the fact that it's one of the three pillars. I think the drivers for R&D in general is looking at losses, as an example. Another one is exactly what you say, Akash, that's the power transfer capability, where, of course, voltage has a big aspect to play. It's also about, for example, depth, reaching higher depths, and it's in the end, also about sustainability. And our R&D efforts are addressing all of these different dimensions of increased capabilities of the system. I think raising up in voltage, making more power flow through the cables is. It's not only a technical challenge, it's also a system aspect of things, whereby the grids also needs to be powerful enough to handle a, a single contingency if something happens in the grid. So if we take the example and compare to China, in China, you have power lines transmitting 5-10 gigawatts through a a single pair of overhead line wires. And while the technology may get there or, or may be there in some aspects for cables and converters today, the grid strength of Europe certainly is not. So, so I think this, this is not only a technical aspect, it's also an aspect of when are the grids able to actually implement the same. I think it's fair to say that we are working on making advancements, and when we feel that it's the right time to announce and bring this to the market, then we will be proud and open about these achievements. Yeah. A question for Line. I think you have a different way of accounting the bonding or guarantees line than some of your competitors. If I understood correctly, you basically account these bonding facilities in your operational expenses above adjusted EBITDA. Could you give us some color on how much of financing cost have you included in your 2023 number, so that we can compare your margins versus competitors' margin? I understand the question, Akash, I do. And that's a transparency we don't give in general into the operational EBITDA, because you're right that it is different. But I think you can take a market conform, let's say, costing of these kind of financial instruments, and then I would use something like that to do that comparison, if you want to. Okay. And the final one also, Line, for you, is that you're giving the guidance on adjusted EBITDA. Could you give us, at high level, the below-the-line items in terms of any non-recurring that we should expect or and D&A, how much growth we should expect based on your capacity expansion plans, and any color on the tax rate for 2024? You know, one of the if you look at least the last three to four years on this, it's been very limited and directly associated with the restructuring program in Cologne, for example, that we conducted. So we don't sit with anything at hand that we're planning. Everything is kind of business decided. For now, nothing. On D&A and tax rate for 2024? So you say, what, taxes? I mean, depreciation and amortization charge and the tax rate, any high-level view on how that should be in 2024 versus 2023? Yeah, so you should expect a slight uptick on depreciation and amortization with the capacity programs being done right. I think you can, you can definitely use Q4 as a proxy for some of that. On the taxes, you should consider, I would say, an effective tax rate around 22% or something like that. Thank you. Thank you. We will now take the next question from the line of Lars Topholm from Carnegie. Please go ahead. Yes, thank you. Congrats also, from me, to a good quarter. I'm sorry, I'm just a little bit confused about your comments on subcontractor revenue and mix from a margin perspective. So if we have a 2025 with revenue from Champlain and from SuedOstLink, and we have a 2027 revenue that does not contain subcontracted revenue of any magnitude, and at the same time will be based on contracts won later than Champlain and SuedOstLink, is your comment that we should not expect any margin uptick? I mean, that must be a better product mix from a margin perspective. So I wonder if you can just enlighten me there? It's a good question, Lars. I just wanna correct, maybe if I misspoke before, it is not so that we will not have any subcontracted revenue in the years to come. That is, then I misspoke around that. There is a natural component in the business we are doing, whereby we do, as an example, both cable laying and burial by in-house assets, but there are also cases where we hire in subcontractors to do cable burial. There is also other ancillary scope, like rock dumping and surveys, et cetera, that NKT typically acquires from subcontractors. So we will continue to have the subcontracted revenue also in the years to come, and that's how our solutions business is construed. The message that we are bringing here today is that the amount in relative terms of subcontracted value this year is disproportionately high, if you compare to what we can expect in the coming years, and that's driven, as one example, by the Champlain project. And my comment before was that, from when Daniela asked the question, all else equal, you should not expect a big margin impact from that unusually high subcontract value falling away in 2025 and 2026. So I was not considering whether legacy products with one type of price level or recently one product with a different type of price level, that was not entailed into my answer. And then Okay, thank you. Sorry, No, go ahead, please. Yeah. Of course, the composition of those years is mostly out of the awards of almost the last year or two, which I think we have spoken to the demand supply curve being in favor of the cable Yeah Producers. So that, that is really what we're gonna have in production, in those years ahead of us. Was that clear enough, Lars? Yeah, I was just worried you canceled any margin expansion post-2025, but that doesn't seem to be the case. Then I have a second question, more on the pricing environment right now. So contracts you bid for or win now versus a year ago, have you seen any further price inflation? And if you have, to what extent is that mainly a function of input cost inflation? I think the discussion we've had last year, where we compare pricing a couple of years ago to the current pricing, I think I used the words that it was unsustainable a couple of years ago, and now we have come into a sustainable environment from a pricing perspective. And we are remaining, in our opinion, at this sustainable pricing level. And then, of course, costs to the extent that they change, you know, of course, also this is something that we are bringing forward also in the prices to our customers. So price is now stable or still going up? I think that's what I tried to say in a more complicated way. But I didn't understand the answer, Claes. Sorry. No, but that's why I confirmed it. So the prices, I think, level compared to last year to what we see now, is more or less stable. Okay, fantastic. Very clear. Thank you, both of you, for taking my questions. Yeah. Thank you. Happy to do so. Thanks, Lars. Thank you. There are no further questions at this time. I would like to hand back over to Claes Westerlind for closing remarks. Thanks a lot. Again, as I started, this telephone conference by thanking you for participating, and also, not reiterating the messages other than that, we are exiting a year, which confirms the trajectory that we are on. I also want to extend my huge thanks to all the colleagues in NKT who have worked very hard to achieve what we did last year. As you can see, NKT is set from a backlog perspective, from an ambition level perspective, to go in with confidence into 2024. With those words, thanks a lot, everybody. I'm looking forward to see you in, hopefully, in the next couple of weeks and months. This concludes today's conference call. Thank you for participating. You may now disconnect.