Incap Results Webcast. My name is Pauliina Tennilä, and I will be hosting today's webcast. Incap's President and CEO Otto Pukk and CFO Antti Pynnönen will go through the Q1 result presentation, and after that there is time for questions and answers. You may post your questions in the chat room already during the presentation, and this webcast is recorded so you can review it later on at Incap's website. Otto and Antti, let's begin. Thank you very much, Pauliina, and thank you all that have come here to listen for our Q1 webcast. It's always nice with the interest in Incap, and we are always happy to try to answer as many questions as possible from you guys. But perhaps let's start a little bit on the Q1 and some of the highlights from the quarter. As expected, of course, compared to the last year, we didn't have as good a quarter as last year was very much part of where we ended up with too much inventory for our biggest customer, or not us, but our biggest customer ended up with too much inventory. But as we mentioned during Q4, we thought that the fourth quarter was the lowest part of the year, and from there we have been able to start picking up again. So we have nice growth when it comes to quarter-over-quarter. We are up compared to with revenue over 20% and also with EBIT over 60% in the quarter. And I think that shows that our plan is holding. We are moving towards where we expect it to be. And as I mentioned before, this stocking exercise will have an impact during the first half of this year. And it's still, of course, early on the year, but it looks good that we are picking up and going according to plan. Sustainability, of course, is a key thing for us in Incap. It's very much part of our strategy. And we're happy now. We did the first report where we had a joint report with our annual report and continued to develop that. I think it's a key that we are forefront in the market and among the EMS sector in doing this kind of reporting. We're happy to take our responsibility and lead in that development. I, of course, welcome everybody in the industry to cooperate here. There is a big task in getting the different kind of reporting frameworks and so up and running. We have done a lot of work together with IPC and other industry associations on this as well to get a unified approach in this. So this is something that we take pride in and want to continue to develop and moving forward. As always, fantastic team effort to pull off this growth quarter on quarter. We have done, so to say, the turnaround from the darkest hour, as I mentioned last time. Now we are moving towards the light again. I think overall it's positive. Especially, I think, also positive to see that our Indian unit is picking up and also we see growth there. So very much to summarize the quarter, it's business as planned. Thank you. Antti, how about a little bit numbers for the guys? Thank you, Otto. Let's jump into Q1 2024 financials. Then if you change to the next slide, please, here, EUR 51.4 million revenue. As we know, Q1 2023 was really, really good and solid quarter. There was still very strong demand from our biggest customer. Therefore, the drop was 29% versus that quarter. But now, and if we compare it to the previous quarter, so Q4 2023, we had a growth of 21% in revenue. So that's a positive. Regarding operating profit, Otto already mentioned that compared to the previous quarter, there was a significant increase in the profitability. And then now we recorded 11.7% from the revenue. And that's, in absolute terms, EUR 6 million. And then on this slide, we have a trend. So as we communicated already earlier, we think that the worst is over in the fourth quarter in 2023. Then now we see a slight positive turn in the key figures, as the graph demonstrates here. On this slide, we intentionally wanted to include also in the column previous quarter, so Q4 2023, just to make the illustration of the development better. On the bottom side, the key numbers that we typically report, inventory level is always very important for us. So EUR 70.2 million, quite solid, no major changes there. Still, the material availability issues, there is some of those, but in big picture, I think that hasn't played that big role as a couple of years back. Interest-bearing debt, it's still in a very healthy level, EUR 4.5 million. Our cash position is very solid, EUR 39.5 million overall on a group level. And then on the personal side, actually, this report shows the official data from December 2023. Then if we would report also the headcount in Q1, there would be a couple of hundred persons' increase. That's the fact that the business in India has a little bit developed in the better direction. There's some increase in headcount there. Yes. When it comes to the outlook for the year, we haven't changed anything this quarter. We still remain that our revenue and operating profit will be lower than 2023 due to this stocking exercise. Of course, as I've said before, it's in the first half we expect the biggest impact of this. Currently, we are moving on growth, and we see improvement quarter-to-quarter, and we expect that to continue. So far, we haven't done any changes in the steering. It's still early in the year, and let's see how it plays out and develops. I must say that currently, we have a positive development in that sense. We are expecting to grow quarter-on-quarter, and in that sense, look forward for the year and how it will play out. I think that is more or less the numbers and the summary from our side. Of course, now there is the main part of the event, the Q&A. Shoot and be nice. Okay, thank you, Otto and Antti. Let's begin with the questions now. So one second. So how satisfied are you with the profitability of the first quarter? How do you expect the profitability to evolve in 2024 and 2025? And do you believe profitability can be raised back to even peak year levels? Of course, in the EMS business, if you have profitability and as our adjusted profitability in double digits, then you need to be satisfied. I think the key here to understand that it's exceptional to have this kind of higher EBITDA. It's very much due or thanks to our operating model and our flexible setup in that sense. When it comes to exact numbers in this double-digit range, of course, it depends a lot about our product mix. We have had that up and running before as well. I think the setup itself gives us a possibility to remain in double digits. But then if it's 12, 13, 14, 15%, it always depends very much about the product mix in that sense. Thank you, Otto. So how much did you grow excluding largest customer and Pennatronics M&A in Q1 2024? I don't remember now from the top of my head. 38% we had with other customers. How big chunk of that was Pennatronics? Of course, Pennatronics was included in that as well. But I don't have that figure on top of my head. I can look it up and get back to it. All right. Then there's a question about the years 2024 and 2025. You touched on them already, but how would you describe your visibility into the end of 2024 and 2025? Yeah, no, as we have talked here in previous webinars as well, that now when component availability is, I wouldn't say totally back to normal, but have improved significantly. And we don't have these big crises with pandemics and so hanging over us. Then, of course, the visibility has been shrinking a little bit. There is no point for our customers to have these really, really long forecasts in it. But it's still better. I always take as an example, when I started in the industry, then you knew what you were going to do the coming three months, and then it was really blurry afterwards. And we are not there. We are not back there in that sense. So we still have some kind of 6-12-month understanding in it. But as we had here during the component crisis, the heydays where some of the customers even gave 2-year forecasts, that we don't have anymore. So it has shrunk a little bit, but in some kind of 6-12-month perspective, we have quite good understanding of what we're going to do. But then, of course, things can change. And so it's still early in the year, as I mentioned before. All right. Then there's a question about major trends and changes and demand drivers such as outsourcing, green investments. Do you believe your growth in the coming years will primarily be based on certain sectors or trends? No, of course, our growth is also tied up to the different megatrends that we have in the world and also to the different political and new political situations in the world. So Incap is just one of the players, and we are living in this globe in that sense. And then, of course, everything that is here affects us. That said, we have before taken out the number that over 80% of our business has to do with something green. I think these kind of green and environmental trends that are with green energy and green mobility and so on, especially that is now driven both in the European Union and partly in the U.S. as well. I think, of course, it will have an effect on Incap. And I think we are in and our customers are very much in the sweet spot when it comes to that. We need to take care of our planet, and we need to develop technologies to help with that. And here we are in that sense. Yeah, on a short- to medium-term, we see a clear increase in the demand in different defense sector-related electronics and then also electric vehicle-related products, chargers, etc., etc. So the electric vehicle industry and those kind of products are also showing some increase. Okay, thank you. It seems that many other EMS companies have faced growth and profitability challenges in the recent years, but Incap has consistently grown strongly and profitably, except for its largest customer. What are the reasons for the positive development of your smaller customers? I think it comes down to how we operate the company. We have a decentralized model in Incap, and that means that the business decisions and so are done locally. We have dedicated teams around every customer, big or large in that sense. We don't prioritize on a headquarter level when it comes to resources and so, but the units drive this. This gives us three things. One thing is that the perception of our services from our customer size is really appreciated and really high in that sense, that we manage to give a good customer service and go the extra mile that is needed in today's market, and especially with challenging customers where time to market and so is important and where they can utilize our help. By being decentralized and having or giving the opportunity to people in the different units to take responsibility, that also gives opportunity to people. Then people get motivated by having the possibility to take responsibility and drive the business and be part of the decision-making and so on. If you look at Incap's unit, we have fantastic people in all of our factories, and they are dedicated, entrepreneurial, and really burning for what they want to do. It's their business, very much their business when you come into a factory. It's almost walking into a startup environment or so, everybody talking business and are interested in what we are doing. That's very positive. People is the second thing. Of course, third thing is that we don't have any headquarters, basically, to talk about. We have some 5 people or 5 or 6 people on a headquarters level, and we are listed companies. So a lot of those people are dealing with communication and investor relations and so on. And of course, not carrying any big headquarters, that means low overheads, and we are not eating up the profit that we have from our units. And that means more on the bottom line and also, hopefully, also happy owners in that sense. Thank you, Otto. Then there's a question about M&A. Do you expect to close any M&A during 2024? And is there some kind of a dream target geography that you are looking at? Yeah, no dream target. I think U.S. market we have dipped a toe in now. And that is a huge market, and I wouldn't be surprised in the coming years if we manage to expand there further and so. We have said before that the German market is the biggest one in Europe, and of course, that is always in the focus for us. And also that in Asia, currently, we are represented in India, but there are a lot of other interesting countries there as well. So I would say that perhaps Southeast Asia, U.S., and Germany are some kind of target markets. But we don't turn down deals if it makes sense to make, for example, a bolt-on acquisition near to one of our factories or in another country that I didn't mention now. It all depends on what kind of value it creates and value it brings. We continue. We have a solid financial situation currently and good cash position and so. And we believe that what we are doing is scalable. We can take on more units and drive it in our Incap model and work on profitability and so in those that we take over. So we continue with the track, with the M&A track, and we have a good team in place. We have a pipeline we are evaluating. And so I'm quite positive on exactly when we will close a deal. And that is perhaps not to say in this forum, but of course, we are working on it. And it's always two parts that need to agree upon the valuation and other details. So let's see. But I'm positive. This is a track that we are continuing to pursue, and I expect us not only to grow organically but also inorganically the coming years. Thank you. There's a good follow-up question on this one. So after now about a year of experience with the U.S. acquisition, could you share a little bit the benefits and lessons learned from this acquisition? And has the acquisition met your expectations? Yeah, I think the acquisition very much met our expectation or even beyond that in that sense, that the U.S. unit has been performing very well. This, of course, is very positive. We have had a good integration with them, and it feels very much like we have been working much longer than just less than a year with the guys in the team. So I think that is the key. I think if you look at lessons learned, I think values are very important. Values are very important. Having our U.S. team, we have very similar values had with them already going into it. That makes integration and everything so much easier if you think alike and you have this kind of mutual respect and mutual look at the world in that sense. So I think that it's not only numbers and that you need to match things on the financial levels, but you need to look at the different kind of, I would say, softer part of acquisitions as well. I think the U.S. acquisition have showed us that yet again, that this is important and we are doing the right thing. It's not, I would say, by chance that the integration have gone very smoothly. I think that already started when we sat down first time with our new colleagues and understood that, yeah, we have common values and goals that we want to pursue. Okay. There's a question about the price pressure. You have indicated that you have seen a little price pressure on prices and margins. Has the market stabilized in this respect now? I think there is still a pressure in that sense. Now, perhaps we don't see an impact in that in our current numbers. Perhaps it also depends on what kind of product groups and so where customers we are talking about. Perhaps we won't see any big impact in our numbers on it either. But there is availability now for everybody, the material availability for everybody. There is a lot of production resources, for example, in China due to that companies have moved out of production from China. That gives, of course, opportunities and so forth in the short term as these companies try to defend their market position and so on. There is still this trend. But I wouldn't say that now we are under tremendous pressure when it comes to prices. For sure, the issue is still on the table in that sense. Okay, thank you. I think we are coming to the final questions here. If you have any questions pending there, please share them with us. Otherwise, we are getting close to the end of this session. One of the final questions is here still about the guidance. You already touched on this, but how confident are you in your current guidance in terms of both revenue and EBIT? Yeah, no, in the current guidance, I'm very confident in that sense. And as I mentioned before, it's still early in the year, and let's see how the year develops. But I wouldn't expect it to develop negatively in that sense. We are on track. We are growing quarter to quarter as we have expected. And in that sense, I have full confidence in the current guidance. And as I said, yeah, if we have better visibility and better understanding, then we will update the guidance as well. But yeah, currently, it's early in the year still to do too much positive moves. There's a question about then, I guess, about the execution and how your work looks and what is sort of the priority for your daily work during 2024. This goes both to Otto and Antti. Yeah, Antti, what's your priorities? What's your priorities? Yeah, well, if there was a list of three, I would say one of those must be acquisitions. We have, like Otto mentioned, we have a very ambitious plan for executing acquisitions and growth through inorganic methods and everything around that that is definitely falling on my table as well. So that's one of those activities. Then, of course, different kind of investments and managing those and financing and follow-up on different major-size investments. We talk about some ERP-related IT investments already have started, actually, in one of our units. And those are very critical for the modern business. So IT, ERP, bigger investment type of topics are probably second. Third, of course, then day-to-day finance management of different activities, improving cash flow, etc., etc. So all these kind of finance-related topics, of course, is a very big part of my daily task. Those three, I would mention on this one. No, that's very good. Very good. No, I share, of course, a lot of those with Antti. But yeah, my main role is to keep on helping the units in that sense, facilitating their business. We have a great team all over the world to help to support them, get the investments they need, and so on. That is, of course, a big part of my day-to-day work. Then, as Antti said, we are focusing on acquisitions. We are looking forward to continue developing this company. I think it's scalable in that sense, what we are doing. And there is possibility to earn money also in the MS business. It's depending on how you operate it. And I'm up for that challenge and looking forward to continue development of Incap. Everything comes down to the team and the fantastic people that we have in the organization and helping them and supporting them and keeping sometimes out of the way from them. That is the key thing for success, I think. Sounds great. So I think we have now answered all the questions in one way or another. And so on my behalf, I'd like to thank you all for the good questions and your interest in Incap. And Otto, would you like to wrap up the Q1 once more? Yes. So as planned, everything is going as planned. We are growing quarter to quarter, positive development in that sense. We also see growth in India, as Antti mentioned. We have increased also the number of people there slowly. And overall, it's going according to plan. Still a little bit early in the year to make any bigger changes in steerings and so. But we look positively on the future and are thankful for the interest and so in Incap. So hopefully, we managed to answer most of the questions. And if there is anything more than, of course, an IR forum, then you can always contact us directly as well.