Welcome to our Q2 2025 Pre-Silent discussion with our analysts. Welcome to the call, and like usual, we can kick off with a Q&A format. Any questions you might have before we start our silent period? Let's kick off, and please, stage is yours. Daniel, please go ahead. Thanks, Simo. Maybe if you could start and remind us on maybe your plans with potential software price increases for this year. When are you planning to do price increases, and is there any sort of indication how much it would be this time? Maybe start with that one. Yeah, first of all, we have already, during previous years, executed price updates and price increases, and the same approach will be followed this year, and they will come into effect in Q3 to some extent in certain products and in certain products a little bit later. We are also planning this year, or we are in the planning stage of pricing update also regarding our Ultima ERP tool and accounting pricing mechanism overall. We're not only speaking about pricing updates or increases, but also we're planning to change the pricing method. The details of that we can disclose more as we move forward. Now we're currently in the planning, and the target is to simplify the model and make it reflect more the actual customers' rolling revenue performance and not so much on the post-cycle mode. During the second year half, we will have effect on the pricing increases, and they will be pretty much in line with what we have been conducting previous years. Yeah, so maybe if I jump in also a little bit about the Ultima pricing mechanism change. What we are planning currently is that towards the end of the year, we would be able to start moving our customers from the post-cycle annual adjustment fee to more like a real-time effect on the revenue-based pricing. It is more of a timing change for our customers rather than a pricing mechanism change. Exactly. Okay, thanks. Maybe if I carry on, maybe just one question, then maybe Emil can jump in after that. You discussed this sort of low sales resourcing in Q1, which I assume you got fixed during the quarter. There were more employees in your payrolls in Q1, but can you sort of remind whether this was just a Q1-specific issue, or is this sort of still something that might impact in Q2, low sales resourcing? Yeah, actually that's been asked a couple of times now in some of the investor discussions. We did have a shortage of sales resources end of Q4 last year, which we then fixed, and we had full staffing in place as we started the year. More the comments have been around how we allocate the sales coverage overall. There has been a little bit of shortage of focus into our existing accounts and how we execute the cross-sales. Now, related to our operating model change in March, we have now built a coverage in our sales where we have the full coverage into our existing customers, meaning that there is a person accountable for the current customer up and cross-sales and making sure that the customers are being taken care of, the existing customers. Of course, through that, we are planning to make a significant improvement in our product penetration, which we have been discussing previously. Also, we have a coverage for the market prospects in Finland. We have been listing our ICP, ideal customer profiles, in Finland, and we have now built a coverage model where we have also new salespeople responsible for converting the prospects into our clients. I would say that we have full staffing in place in sales, but also we have now aligned, based on our operating model, the resources to existing customers and to prospects. Now, of course, we're still in a ramp-up mode, so always changing customer responsibilities takes a little bit of time. We're not seeing the full performance yet, but at least now we have a good plan in how to tackle both the existing and new customer sales. Approximately the headcount is divided half and half, just to get the picture of how the allocation has been conducted. Of course, through that, there's a lot of additional focus into serving our existing customers and to boost the cross-sales opportunity. Yes, and maybe Daniel, you probably also are looking for an answer to whether our headcount increases have continued. Maybe to comment on that also a little bit. We had unusually many new resources or new employees starting on the 2nd of January. We have never had that kind of a situation that so many people have walked in from the Admicom doors on the same day. Simo started on that day and also our Chief Product Officer. The answer to that is no, we haven't had a similar recruitment ongoing. As we mentioned already in the Q1 earnings call, the end of last year was still in the investment mode, but now we're more in the stages of making sure that the resources are allocated in the places where it makes the most sense. That was the main purpose of our operating model change as well. Thanks, that was very clear and thorough. Maybe I'll jump back to the Q. All right, Emil. Yeah, thanks. Maybe asking a question which is, I think, asked a lot, but just want to make sure on the annual adjustment fee you guided for EUR 0.7 and just to make sure most of that should be arriving in now Q2. Isn't that right? If we compare year on year, then it was quite big last year in Q2 as well. Yeah, yeah, I would say that roughly two-thirds of the annual adjustment fees are invoiced in the second quarter and one-third in the third quarter. That's typically how it's divided. We didn't guide 0.7. It was in the basics of our guidance, but yes, EUR 700,000 was the estimate that we based our guidance on, and we haven't had a need to change that. It looks like that's about the amount that the adjustment fees will be this year. Of course, the adjustment fees can also be negative, so they can also be credit notes to the customers. Even if we go above at some point of the year, the sort of cumulative amount might also come down then. Yeah, thanks. Another thing which you did not guide, but at least you had mentioned in your outlook that you had the external software development revenue. Those are declining EUR 0.5 million. Was that impact already seen fully in Q1, or how have you been thinking about that? That's the full-year impact. We have gradually been terminating the contracts with the customers. I think we still have a couple of small volume contracts ongoing, but by the end of this year, we should have basically run down the whole business. There might be some very small software development services contracts still being continued if they are somehow related to our industry. Okay, that's clear. Thank you, Satu. Atte, please. Maybe first about the changes in your organization, how you think overall it has went this far, and how are the employees getting used to the new organizational structure? Yeah, it's been, of course, a big change which we introduced. We terminated the business unit structure, and what I have described is that it was an operating model change from a product portfolio-centric model to a more client-centric model. The growth unit example of customer responsibility is more divided based on the customers rather than looking at things from a product-centric. It's more like the change that we have been applying now across the border. It has been quite well received, I would say, mostly positive feedback. We're still in the ramp-up mode, like mentioned, where we're still learning how to operate in the new model. We have a single platform unit where we have the product management, product support, and product development. They have been starting their work, and they have now split the portfolio responsibilities. We have formed product teams where we have the product managers and also the developers forming teams who are now looking into the development backlogs and making sure that we're prioritizing the right things. Something that is really important for us is that how we start putting focus into cross-functional platform capabilities. Like we have been mentioning that we have single Admicom user identity for across all different products. We have single sign-on that we have been pushing to make it easy to access the different products. Similar capabilities we're now starting to build so that things that make it easier for the customers to cross-collaborate in our portfolio. That's been one of the focus areas of the product and the platform team. Also, something where we have done quite a lot of progress is the accounting unit, which we brought in as a single independent unit. We've changed somewhat the leadership structure there. We have a new leader for the unit as well. We are starting to identify and plan the development roadmap for the unit. How do we gradually start to move the unit into higher levels of automation? We also align ourselves in the unit more to customer segments that we need to serve and the different needs of the different customer segments. We apply also the customer centricity into that unit as well. Overall, I would say that it's been very well received. We have not seen major spikes in voluntary attrition in the critical roles or anything like that. Like I said, still the working practices and the performance is yet to be still shown, but at least the transition has been going quite well. I think people know what they're expected and what their role is. Now it's a good starting point to get really into full speed during the second year half. All right. On overall, do you think, because now we know that it's a pretty big change, is it like slowing down your operational efficiency this year, or for example, do you think your sales capabilities are not on the 100% level during the change? is always a period of slowness, and I would say that we have seen some of that during the time after the change. My expectation is that we are not going to see a full slow year and people not knowing what to do, but it is more like we are starting to get to full speed and full mode during the second year half. There has been some slowness, like always expected in a bigger change, but nothing that I would say is somehow alarming or something that would revert us back from the changes. It has been more like normal change-related slowness when ramping up and picking up the new responsibilities. I have a great expectation that the new model will start to really show its performance during the second year half, and especially in terms of clarified customer roles and customer responsibilities in sales and also in the product side, having more focus on the cross-functional capabilities of the platform to make it even more integrated and unified platform experience. Maybe last question about the overall market situation. There has been pretty mixed signals during the past few months. There are some positives and negatives, but can you say anything about how do you see compared, for example, Q1, how the overall market situation has developed after that? Yeah, I would say, and mostly referring to some industry forums that we have been attending and customer feedback that we have been receiving, plus also the statistics of the Finnish construction industry volumes, we have definitely seen the bottom of the volumes, and there has not been any more decline in the market. The recent months have been positive in terms of the volume change in the market, but unfortunately, the changes have been very small. There have been low single-digit changes compared to previous years. Before we start to see double-digit positive changes during the months, that is when we start to speak about real recovery of the industry. It has been pretty flat and quite small change that we have seen in the general market statistics and overall market sentiment. What the customers have been telling us is that, and this is a direct quote from one of our larger building engineering customers, that they are seeing the record high proposal backlog, but the order book is record low. There is a lot of proposals out. There is a lot of initiatives that have been reestablished and restarted, but they have not converted into orders yet. There is a lot of waiting in the industry at the moment when the demand is starting to pick up and when they can start to, when they have the confidence to start the new projects. It is a little bit in a waiting mode, but I think we see the right signs in the market. I think the interest rates going down is a good sign. We have seen big building or construction companies like YIT and others reporting that their backlog of new apartments is going down. They have been able to sell their apartments from their balance sheet. All the indicators are showing that at one point the positive trend will start to pick up, but the expectation is that it is a little bit slower than anticipated in the beginning of the year generally. The more significant pickup, like we heard some other customers and industry players in the construction saying, is that the expectation for the more rapid improvement in the market is likely to be postponed towards the end of the year or next year. All right, thanks. Felix. Yeah, thanks. Just one question from me. Can you comment a bit about what you're seeing in regards to insolvency-related churn, which, if I recall correctly, was sort of a bit elevated towards the latter part of Q1 and overall how your visibility is towards the customers' solvency situation and what you're seeing in that regard? Thanks. Yeah, we obviously analyze the churn on a regular basis, but I think that it's important that we share details on the churn only after the Q1, sorry, the Q2 release is out. I don't think that we will disclose any sort of preliminary information about that in this call. Yeah, maybe just to comment that as you have seen from the general statistics that the bankruptcies and insolvencies in Finland generally are quite high still, and you can find a lot of construction companies among those. The situation has definitely not improved in the market overall and in the construction industry. More details as we disclose the results of Q2. Jukka-Pekka. Yeah, thanks. I'm interested about the Bauhub expansion maybe in the Baltics and also, of course, the receival in Finland. Could you talk us through how's the expansion going and how it's been received in Finland as well? Yeah, as we reported in our Q1 release, the localization was completed a little bit ahead of time for Finland. We have first customers onboarded in Finland as well. As Bauhub is a project-based revenue model or subscription model, the actual ARR will start only when we start to see the project starting. Like I mentioned about the overall market situation, all of the projects are still waiting for their initiation. The pickup of Bauhub business will only start when we really start to see the projects getting started. Customers have started to onboard onto the product. We also have some first public references of Bauhub in Finland. Expectations are very positive towards that, but the real major business impact is still yet to be seen. We do not disclose product-specific ARRs or revenue numbers. We don't go into details around that. What I can tell is that the capabilities of Bauhub is something what the market has been expecting for a long time. We have conducted some demos also for the investor community. Looking forward to doing more of that as we move forward, just to demonstrate what Bauhub does and also do more demos of our other products as well. The general reception and feedback has been very positive. Of course, Bauhub is a product where it defines a new way of working for the whole industry. It needs that more stakeholders will start to actively embrace that and take that as a new way of working to share information in cloud, collaborate in cloud, share materials in cloud. It will take time before the change of the ways of working will happen, but the initial feedback is actually very positive. Okay, thank you. Maybe other question relating to that. For the Bauhub's Finnish customer base, do you mostly target existing customers or can you attract new customers and convert them to the Admicom ecosystem as well? How's that been going? Yeah, definitely. We have been targeting both into existing customers and new customers. It is potentially one of our land products where we can land a new customer, onboard it to Bauhub, and then start cross-selling through that. Definitely both have been in the focus. Okay, excellent. Emil, back to you. Yeah, I just wanted to ask on the non-recurring items in Q1. They were quite small, but one percentage point impact on EBITDA. What were those related to? Do you mean the items? There's a difference between your reported and adjusted EBITDA? Yes. They were related to the change of CEO, for example, and some other smaller items. Okay. This has nothing to do then with the, for example, IT or the? No, no, no. We do not categorize those as adjustments to EBITDA. Okay, good. Good. Thank you. Any further comments? I don't see any hands raised. Daniel? Maybe one more. If you could give a quick status update maybe on the internationalization. I guess I had some note that there would be some sort of update maybe in conjunction to Q2 what comes to maybe collaboration with JM. Also these sort of partnering plans that you have been discussing previously. Is this something that maybe we should anticipate for Q2? Yeah, we haven't made any big announcements in the internationalization, and we would definitely make a corporate announcement on that if we did. We have been continuing selling cross-country from Finland to other Nordic countries, and we have some sales opportunities that are progressing quite nicely in the Nordic countries. They are for us like a good way of testing our platform and our product market fit and competitiveness. We are doing that just to make sure that we are testing our competencies and our competitiveness, and that's more like opportunistic. What we have been doing over the course of last months is to further plan our go-to-market strategies, and we have been building or starting to build our go-to-market playbook. What steps do we apply when we start evaluating new markets? Nothing that would have a material impact into our business, not in the cost side or the revenue or ARR growth side. What's important for us is that, of course, the Chief Strategy Officer role has been open for applications, and hopefully we can announce the person in the couple of coming weeks. We are very far in the process, and hopefully we can have the person announced very shortly. Definitely before the summer holidays start to kick in, and we will have a Chief Strategy Officer in our team as we start or we return from the holidays. Very happy about that. We received a huge amount of very high-quality applications, so I was very happy with the process, and we're going to have a very strong team member to also lead our internationalization efforts. We have had two team members working on the topic to prepare the plans, but then we will have a leadership team member who will be then owning the topic. All right. That's clear all from my side as well. Thank you. I could still ask about the AI project that you get some funding from Business Finland, how that has kicked off now. Yeah, we have a fairly sizable team dedicated to do customer pilots. We have 10 Finnish customers who have been enrolling to test and pilot the AI solutions with us. Those pilots have been going quite well. We have customers actually using some of the AI capabilities. They're mainly focused on the construction site operations, making the user interfaces and the functionalities at the site more easy so that we have more automation how to update the readiness reports and make some changes to the plans from the construction sites. We're now working on creating more current roadmaps based on the findings that we have and also how we're applying the AI into our portfolio. A lot of the investment that we received and what we're doing are now related to executing some of those pilots and research items in those. At the same time, we're doing product investments from our CapEx investments as well so that we're doing both research and product development in the AI at the moment. More use cases are in the making, so we're not short of opportunities on how to use AI and where. More information will come out as we start having results from those activities. The initial pilots have been going quite well, and we have some functioning AI use cases. Like I said, more results and more concrete information how that will be affecting our portfolio as we start to get the clarity of that. The first initial feedback has been quite positive. Also in the research project, we are still a little bit in the ramp-up mode, so still more to do there. We're looking into some academia collaboration and also more use cases that we're researching. All right, sounds good. All right. I think we are running out of time. Thank you for the questions. Very good discussion, and we will then return back to Q2 after the silent period as we release our Q2. Thank you for all of our analysts for great conversation. Thank you. Thank you. Thanks for your time. Yep. Have a great summer. Bye. You too. Bye. You too. Bye.