Hi, everyone, and welcome to this webcast where we present Kempower financial results for the third quarter 2024. My name is Paula Savonen. I am the VP of Communications at Kempower and also the host for today's webcast. Today we have two presenters. We start with our CEO, Tomi Ristimäki, and continue with our CFO, Jukka Kainulainen, and you can ask questions anytime during the presentation by typing the questions in the Q&A box on the screen, and we really hope you ask the questions and actively join the discussion, and we take all the questions in the end of the presentation, but now we start and over to Tomi. Thanks, Paula. Welcome from my side as well. Going over the quarter in brief, I think it's clear that the challenging market conditions are the same, so high customer inventory levels prevailed, and customers' slow decision-making continued to impact the sales performance. How we have come to this high inventory situation in customers' installation stocks, we could remind on the topic of this high amount of purchasing in fear of component shortage after the COVID, and then, of course, the market not being able to deliver the grid connections needed for this large quantity ordered, so basically the message is that the grid installations haven't been getting slower. Actually, I can show figures how it's actually getting faster, but the high amount of orders, of course, made it so that this couldn't be done at the pace that our customers were hoping. Market situation. Year-to-date installation grew significantly in both Europe and North America, which tells that the charging market is actually growing. So looking at it from that point of view, that now the goods are coming to the warehouse, to the sites, but the actual charging networks are growing all the time. New customer acquisition. Of course, in the situation when current customers have this stock inventory, it's very important to focus on new customers. And we onboarded 12 new customers in Q3, totaling actually 44 new customers for the year. Strategic developments, which is a big milestone, that the ramp-up of next-generation product portfolio is now completed. This doesn't hinder revenues from customers ordering the new when we have the full capacity in use. North America revenue for January and September more than doubled. And as a big milestone for our U.S. market, we acquired the first customer under the NEVI funding program. And I could remind that was actually one of the main reasons to actually have the U.S. entry done two years ahead of the schedule. Profitability improvement, we are progressing well towards in targeted savings, which is actually to make a profitable Q4 this year. And could also remind on the strong financial position, we have one of the strongest liquidity positions in the DC charging industry. Now looking at a little bit more on the customer inventory levels, and they affect our own intake from the existing customers. And I could say that customers who were bringing the largest revenues, largest orders in 2022-2023. And as we anticipated in June, in this similar session for our first half of the year, the decline in inventories is not significant. We are now estimating the excess inventory on the market to be around EUR 80 million and remain high until the first half of year 2025. Positive new customer acquisition will still dilute the effect of high inventory levels. So this is actually why we are concentrating a lot on actually onboarding new customers. Electrification mega trend continues. This is a lot of debate. We hear it from the media that maybe the EV cars are not selling. There is something happening somewhere. Green transition has put a question mark to it. But if we look at the data, the installations are growing 18% in Europe from year-to-date figures. So it means 18% installations per quarter compared to the last year and 74% in North America. So the charging networks are really growing quite rapid pace. The share of electric vehicle registrations in January to September 2024 is at the same 15% level. This is actually something that this means it's all the time we have more electric vehicles on the market. 15% of all new vehicles. In North America, the percentage is lower, but this is a new market. Let's say the change rapidness has been faster. We see actually the amount of electric vehicles in North America market that it's not that much behind Europe, even when we talk about the percentage. The high amount of cars actually makes it that the amount of EVs on traffic is actually gaining Europe from the, let's say, quantity point of view. What is also a very positive change when we look at the customers' funding, looking at investments into charging network and charging network companies. That's recovering in 2024. This 2023 compared to 2024, when we look at the funding of our potential customer base, this is recovering and it's recovering actually quite significantly. On the sales recovery, it's progressing step by step, onboarding new customers. I think also when the customers are not in a hurry, the qualification periods for pilot deliveries, pilot sites takes more time. So the customers are testing the products more thoroughly. So when you gain the new customers, you have the first sites. I think compared to the last very rapid years, before the big deployment starts, there's a longer testing period because it's the carefulness of customers that they really have the right solution. We could talk about four-month, six-month testing periods with the first deliveries and then decisions to actually start ordering in larger quantities. The steady expansion of our customer base positions us well to regain momentum and return to our growth track. This removes a lot of risk when you have a wide customer base. This means that you are less affected with certain movements or single customer events. So I think it's a key thing for us to grow the customer base even more to divide the risk over the large customer base. Ramp-up of the next generation production portfolio is completed. It's no longer limiting revenue growth in quarter level. Some examples. I think it's great to show examples on having a first site inside New York and especially in Manhattan. That's a Pier 36 in between Brooklyn and Manhattan on the Manhattan side. These kind of sites are really good showcase for the market. Another one, new things happening in India. I think we have a couple of rollouts going on in India. This is a new market for EVs, but actually a very promising market. We are looking at this more in the business development sense that is there a good market for Kempower or not. But we are today, like the rest of the world segment, we operate through key partners and actually all the time do the business development. The main focus of Kempower is, of course, in strategic markets in Europe and North America. But we do look at the other parts of the world to really see where the growth happens and be there on the right time. And also mentioning, I think what we have told before, and I think the sentiment is getting even stronger, that the biggest DC charging market by 2030 will be the truck charging. There's a very clear message also on the ambition level on truck manufacturers where they see that their sales to be how big percentage from their sales, the battery electric trucks will be. And this is being more and more strong messages from there. There seems to be a lot of interest, and we see this not only in Europe, but maybe even stronger in the U.S. side. And this side here is the first logistics hub with Kempower fast charging in France. And there is a steady progress in North America. The revenue from January to September 2024 more than doubled. And there is a good sales pipeline. And there is room to grow in the market. We are also talking about the market where the DC charging installation grows 74% compared to last year. We acquired the first customer under the $5 billion NEVI funding program. We have significant new customers. As described, from these 12 new customers, there was a global truck OEM from the U.S. and also a Fortune 500 energy company from the U.S. We completed the ramp-up of the next generation product portfolio. This is a very key thing for Kempower this year. This is actually a very large project when you actually renew the whole basis, the platform behind your products, and you do it within the first five years of the company. Of course, the first renewal of a platform is a big thing. Now we see actually that we are in a normal state in production and a good quality level. Production yields are very good. So we are ready to actually ramp up, let's say, ramp up the deliveries as well. So the production is ready, product is ready. And it will provide top-of-the-class performance to our customer. And we have also published white papers on the topic, but it has exceptional power factor and efficiency. I think the key here is efficiency because this is better performance to our direct customers who are selling the electricity. So this is direct OpEx improvement in our customer base. Technological development. This is going again, of course, as a Kempower's core is actually to be forerunner in the market. And we were the first company to bring MCS to the market with market launch. And the first true MCS delivery and also step increase in our standard CCS series that we go up to 700 amps, we will do in Q4 2024. These both are really targeted into heavy vehicle charging. If we are talking about trucks, we are talking ports, but the machines with big batteries and heavy weight. And another key thing with California, this is very similar. We have been discussing on this Eichrecht certification for Germany, which means accuracy of electricity measurement compared to the payment. So the CTEP certification is now stated. And it certifies Kempower's equipment regulatory standards and protecting consumers of faulty off-board devices. And as a side note, Kempower was the first charger manufacturer who could actually comply CTEP requirements without additional electricity meters. And also looking at our product portfolio and what is the whole idea. When we look at our portfolio, the leading idea from our side from the beginning has been that there will be a lot of electric vehicles. There will not be single charging sessions for single vehicles in the market where the adoption gets higher, and this is the whole idea why we have the distributed charging solution. We called it a satellite solution where you have a limitation on the grid power, but you use this limitation to the biggest amount frequency of charging, more transactions based on grid connections, which means directly business benefit to our customers. That I would say is the key when you look at the public charging segment here. You do have on the market still the legacy chargers when we have these charging stations cabinet with two cables, but we see the movement that is, I think, led by Kempower and Tesla going into these distributed charging systems and larger installations, and this is something that we see a key when we look at also the commercial vehicle charging. We look at logistics hub where you have several vehicles, size is limited. You have actually better movement in there. Could remind also the importance in the charging software as a key in actually increasing the sales, but it's also its own revenue stream in our services in recurring revenue that we see now increasing. And especially important interest is rising from the commercial vehicle segment. And then looking at what are the markets in the future. Our vision is to create the world's most desired EV charging solutions for everyone and everywhere. This is part of the story why we have these different animals in brand pictures as well. It's for everyone and everywhere. And I think we could tick the box also in these vehicle types. Maybe not the agriculture yet, but we see that there's movement in every vehicle type. It makes it also in the market very interesting when you have growth-stage segments popping up newer and newer. I would say the buses are in a more mature stage. There is a high number of buses now converted to electric. It's going near to 50% of new vehicles being electric throughout Europe. Personal cars are moving, but that's a consumer-driven market and that's also something that relates to consumer car sales. But on the business segment, the trucks are showing high growth rates. Some might say that it's easy to grow from a small percentage, but this is actually something which is backed up by plans with the truck manufacturers. It's also very much requested by the logistic companies because it affects directly the total cost of ownership figure. Other segments, I would say, in increase we see from port machinery. Of course the vans are going together with the trucks. It was really interesting now to be also charging airplanes. That's an interesting future segment or construction machinery going into electric. We commissioned that. There was a nice story on that we made charging site in the U.S. making electricity with electricity. Every machine was fully electric in that. There are different stages of the market and there seems to be a growth segment in here. I think in the difficulty, I understand why agriculture is not really moving fast because that's hard to handle in that environment. I would say that this is the vision that it's also that these target segments are not only personal cars, it's not only trucks. When you look at the further, it is the machinery market. It is different ways of traveling. It's on air or on water. Sustainability achievements. Step up in EcoVadis evaluation going now for silver label. That's done. Also renewing our Nasdaq Green Equity Designation. An important figure also we see how the usage of our product is increasing. When we look at that, it has doubled from 23. So 1.1 GWh per day. And from sustainability view, this energy would have been produced by fossil fuels if it's not electric vehicle. So this is the difference we are making. It's the best measure for that. What is the impact to the world? And then I give the stage for Jukka on the financial side. Thank you, Tomi. Yeah, let's go to key financials for the quarter. Quarter 3, 2024 financials were still impacted by the ramp-up of our new next-generation charging portfolio, which had some supply restrictions still during the quarter. Also on top of that, we made additional EUR 5 million warranty provision. If we look from the positive side, of course, our gross profit margin, 51%, is a really healthy level. It's a strong number. It's a good number for the building in the future as well. But when going to the profitability, which is impacted, of course, by the low revenue and the, of course, high fixed cost as well, and reflected in the operative EBIT of EUR 7.9 million negative. But at the same time, we have taken those actions regarding our cost side, and we have this target of EUR 10 million annual savings, and we are well progressing with that target on our daily life. On top of that, our operating cash flow was negative for the quarter, EUR 9.3 million, and that was resulted from the negative result, CapEx investment, and also increased working capital regarding the accounts receivable. Of course, these are not the numbers on the level we would like it to be and cannot be satisfied overall. But the actions we have taken are all the time the correct ones and taking us to the better direction. Then going a little bit more in detail about the order intake for the quarter, our order intake rounding up to EUR 52 million for the quarter and EUR 151 million for the first nine months. And that was negatively affected by the high excess inventory on our customer side and also challenging market conditions, which are slowing down the decision making on our customer side. Order backlog at the end of the quarter was EUR 100.2 million. Then regarding the revenue, our revenue during the quarter reduced by 28% year on year was around EUR 52 million, and in first nine months, revenue was EUR 152 million. And this was, like I commented earlier, was negatively impacted by the ramp-up of the next generation charging portfolio, which limited our production volumes. But like Tomi mentioned, of course, the great highlight is that we have now completed the ramp-up and we are in the normal state with the production. So it won't anymore restrict our volumes or revenue generations either. During the January and September, of course, highlight, great highlight was the North America growth. It grew by 127%, so more than doubled. And rest of the regions decreased during the quarter. But also adding a few more positive highlights inside the regions was definitely the DACH area and Benelux. Those both regions, our areas actually doubled their revenues during the first nine months of the year. Then looking at our profitability and cash flow development, operating EBIT, EUR 7.9 million negative and was impacted, of course, through the lower revenue, but also with the increased fixed cost base. And of course, this additional warranty provision of EUR 5 million, what we accrued relating to the old generation product portfolio. Then regarding the operating cash flow, negative of EUR 9.3 million. But at the same time, we have all actions ongoing to improve our net working capital and reduce our inventory levels on our balance sheet in order to improve the cash flow during quarter four and release the capital employed on the balance sheet. It's really important what we want to address also. We have one of the strongest liquidities in the whole DC charging industry. We have more than EUR 100 million liquidity in the company, which means that we stand also a little bit headwind in the company and weaker quarters like quarter three was, for example, then regarding the headcount development, regarding the short-term reduction in the revenue, like you know, we have adjusted our cost base and have taken actions to reduce our cost base overall and targeting this EUR 10 million annual savings, and in quarter three, we concluded the change negotiations. And as a result, we will reduce around 90 people from our headcount during the H2 2024. And how did we do the reductions? So we prioritized the reductions in a way that we didn't want to endanger, of course, our technological roadmap, technological development, and at the same time the customer interface, customer experience either. And when looking at our current organization, our current resources, we can well manage our strategy execution on the short term without any kind of problems. Then a little bit more about regarding our profitability improvement. It's progressing according to our targets. So on top of the personnel reductions, we also made actions regarding the temporary layoffs, which are ongoing in Finland. And on top of that, we are also limiting the external spending on the group level in all the entities. And like I mentioned, our target of saving EUR 10 million annually, that is progressing well. We are progressing towards that target step by step. That is actually a really good link on our guidance as well. Like we are communicated to be in break even in operative EBIT in quarter four 2024. We are well in target with that journey as well. Regarding Kempower's outlook, we have specified our outlook for 2024 regarding the revenue. Our specified outlook for revenue is between EUR 220 million-EUR 230 million. Our previous outlook for revenue was between EUR 220 million-EUR 260 million. Regarding operative EBIT margin, we haven't changed the operative EBIT margin guidance. It's still that we expect it to be negative for full year, but to be at break even in quarter four 2024. Regarding financial targets unchanged as well, we target the revenue of EUR 750 million between years 2026 up to 2028. In the same timeframe, operative EBIT margin between 10%-15%. Thank you. Thank you, Tomi. Thank you, Jukka. And thank you already now for a great amount of questions. And we start with customers and new customers. So how large share of your third quarter's new orders came from new customers that were not yet material to you in 2023? This is good. I think we look at which new customers have made their first agreements or orders in 2024. So what is material, but I think Jukka has the number. Yeah. When looking the whole year, so around one fifth of our orders are coming from the new customers. One fifth. Yes. Thanks, Jukka. Then there is a question about gross margin. Your gross margin was strong. Could you open reasons behind this? Have you seen pressure on pricing? I think it's in this competitive situation, of course, you are more flexible to also go with more aggressive pricing in there, but when there is kind of this storage on the market, or this kind of inventory in the market, the price is not affecting the decisions that much, but we do see more competition on the price level to actually appear when the market of, let's say, attainable market for short term is limited. Thanks, Tomi, then we go to the EBIT margin. Your operative EBIT margin was - 15%. How do you expect to reach break even during the fourth quarter? Yeah, so there is actually three things in the fourth quarter, so our revenue will be highest for the whole year in quarter four. That's, of course, driving the EBIT as well. But at the same time, of course, we have done these cost savings, like I communicated earlier. And then it's good to remember when you look at the three numbers, this additional warranty provision of EUR 5 million was part of this negative -EUR 7.9 million operating EBIT. Thanks, Jukka. Next question is about new customers. When you indicate that you have onboarded a new customer, does that mean that they have completed all the test periods or that you are delivering pilot or test solutions? Again, a German answer, Jukka, yes and no. Depends on the customer because some customers, before they make us, let's say, the first pilot orders, they complete testing already at their own facilities, and some are actually concluding it with the pilots. So, I think when we look at the new customers, if the customer is in piloting phase, we consider the new customer because there has been a significant order in, and this is progressing. Thanks, Tomi. Next, we go to the overall market situation. Can you comment on the overall market situation from the point of view of how your competitors are doing? Are you doing better than them, for example, in terms of order pipeline? I think this is also one reality we have to face that most of our competitors do not publicly report their figures. So this is pretty difficult to define. It's hard to make a comparison. The sentiment from the market, you can find on some bigger large customers who are reporting then in a big report. Let's say the charging, the message is the same. It's stagnant or lower. It is a challenging market for DC charging industry in total because I think the inventory levels are not affecting Kempower only. It's a situation with every supplier almost on the market. Thanks. The next question is actually from the inventory balance. What percentage of your inventory balance is the old generation chargers? And is there demand for these chargers? Is there demand for these chargers giving the launch of the new platform? We do not have inventory ready-made goods. That's not a large portion. We make products to order. Let's say when we look at our parts inventory, which you can find on there, the proportion of is quite small with this related to the first generation of chargers. We did the reductions already earlier this year, like you can find on the reports as well. Thanks, Tomi. Next, we go to the order books, order book sales margin. You indicated in the second quarter that you were willing to cut pricing to win business. What is happening to the order book sales margin and what is happening to the market prices in this challenging situation? I think in the short term, when you say that you are being more aggressive to fill in the order books of this year, this is not talking about a long-term thing, and it's about the market situation. I think we don't see material change there. No, we don't see, but we are still, of course, a little bit willing to adjust. Like you see, it's really healthy margin what we have at the moment. Also, where you see the kind of other margins on the market, on the ones who are actually reporting, it is actually quite a good situation to be in competition, that it's a solid base that you can actually do price competition and your results are not jeopardized by this. Thank you. Next, we go to North America. You won a new customer that has been involved in NEVI projects. What kind of company is the customer? Are you the only DC supplier for the customer? Have your chargers already been used in NEVI projects? Can you elaborate a bit? This was, like I said, it was the first NEVI customer and it's the first site funded by NEVI. There's different kinds of companies where it could be energy companies, could be kind of charge point operators, but there are various companies. I could say this is more like a, let's say, charge point operator, that's installation company. And more will follow if we can actually publish and get the permission from the customer to tell about it. Yes. Of course, will be followed. Then about the North American sales. North American sales only marginally up. Were only marginally up in the third quarter year- on- year. And down quarter-t o- quarter despite the new customer wins. What is the reason for this? How have the orders developed in North America? I can comment on this revenue. So like we communicated that it more than doubled, grew 127% in the first nine months. And this is, of course, a good measurement period. So three months is quite a short period. And I especially been looking last year with the lower revenues, lower volumes. Revenue is not that equal between the quarters. So that's why the one quarter measurement is too short for that. And one point is actually that we have actually had in our press releases before that the full launch of the new product family will be in the U.S. happening in Q4. And there could be more this kind of still look at globally that everything is completed, but we have the launches of the new product family actually in the U.S. in Q4. We start delivering. It's now. Yes. Exactly. Yeah. So we don't see it yet that affect. And I think that brings us again more competitive position in there. Thanks. Then there is a question about the number of employees, the headcount. The number of employees has increased during 2024 while the turnover has declined by 20%. When do you expect the personal costs to decrease? Yeah, so when we take the measurement point from quarter two, so personal costs already have reduced and continue also, of course, in quarter four. And when you look at this, what we communicated about 90 people reduction comparing the quarter two level, which is 907. So you don't see the full impact yet in our quarter three books. So when we report the quarter four number, you see the remaining reduction in our headcount to be visible. Thanks, Jukka. And it was kind of obvious to also make the investment in personnel. If we look at the inventory level personnel, that matches the earlier guidance. That was the plan and we were executing the plan. And now when the market is slower, we are taking it back and we are doing it actually very fast. Yes. Next question is about the sales guidance for 2024. The midpoint of your sales guidance for 2024 points at a sales decline of 21% while you have 36% more employees versus one year ago. The gross margin is holding up very well, but you seem to have far too high costs. Is the plan to wait until market demand recovers or do you plan to slash the costs on top of the now finalized cost cutting program? Yeah, so like I commented, part of the people reductions will be visible in quarter four. And it will be visible in results in Q4 because this is actually the timeline that you don't see actually the savings in Q3 numbers yet. Yeah. And then, of course, another thing is that it's not only people-related savings we do. It's also restricting the external spending overall on the whole group, which is also one important factor in our cost savings, what we are doing at the moment. Thanks, Jukka and Tomi. Then, about the growth on different continents. So, from which continents do you expect the best growth in the future? I think what is happening now, we see and percentage-wise, of course, North America was high and that's actually the market studies is showing the same. Europe is actually, we look at also the EV registrations, which is now very uneven in different countries. We have double-digit growth in several countries. People in Finland look at the number. Finland is actually the lowest performing in the electric vehicle sales. That's the biggest minus in Europe. Then, of course, the mentality in Finland gets that it's the same everywhere. But we have double-digit growth comparing, for example, Denmark, where the registration in first half grew by 50%. And we have double-digit growth in the U.K. We have this in France. So this is actually something that is very different in different countries today. And overall, the electric vehicles are keeping the proportion of the new car sales. And first half showed a, let's say, slight increase even on this. So I think when we look at the market demand, and we have also communicated on the fact that in most of the countries, with Finland again as an exception, we have very good charging network compared to the amount of electric vehicles. This is not the same. So there is kind of, we have been talking about this investment depth that there is too little charging with already for the existing cars. And this is quite harsh reality for electric vehicle users in certain countries, but the number is bad. So this is actually the investments are coming only from this. If there wouldn't be any electric vehicle sales, you would still need more networks. And we see that the amount of electric vehicles is growing all the time. So you need that actually even more. The next question then is actually about the installations. And the installations are growing, but your sales are not growing. Yes. So is Kempower losing market share? No, it's the same thing. I think this is the same situation for every manufacturer today. Because like I said, the inventory, it's not inventory sitting in Kempower. And it's not sales inventory at the customer. It's waiting for installation. So this actually means that this growing number of installation, the products are coming from the warehouse waiting for installation. And that needs to move on certain customers to actually be able to make new orders. Nobody will order if you have, let's say, high quantity of products still not installed, still not making money. So this is actually the point that it's not warehouse which is sitting in Lahti at Kempower in Durham. This is actually all over Europe, all over our customer bases where you look at the situation. And most of this is actually already dedicated to a site. But this is kind of the delay in the installation period and this is delays on the utilities giving grid connections and the combination on permitting. This is kind of, that has not changed, but the amount of installations needed has grown so much that this utility site cannot keep up. They have been growing. We can see it on the figures. 18% more means that they are actually making it better and better all the time. But this kind of needs to go out before the real growth happens. Yeah. We have time for maybe one or two questions. Let's take two questions and then we close. What actions have been done to improve the visibility of the stocks in the pipeline and sales prospects of the distributors to avoid such surprises as we've seen, as we saw in early 2024? Yeah. So if you mean, if the question is about our customer stock, so we have full visibility to our cloud system, ChargEye on our customer inventory. So we see on daily basis what's the inventory level, how much is commissioned and how much is uncommissioned chargers over there. Thanks, Jukka. And then let's take the last question about the customer interface and customer side and why they would choose a different vendor over Kempower. So what reasons or feedback have customers shared when they choose a different vendor over us? I think in all the cases, maybe the distributed load system is not the right choice for every market, every location. And there could be a better choice maybe having this legacy standalone products as well. So it is a suitability for the sites. That's one, of course, price has an issue sometimes. If it's a really heavy pricing, we are still in the premium products. So willingness to go really in very, very low is not really something that we do. It is the points of what is suitable, what is the relationship. If it's a long qualification period with the customer, if the other supplier is already in, you come in, your orders will come later. This is also time aspect in here. Then I just want to ask, when the customer chooses us and you could choose three different factors. I would say the main point and where we and the understanding that the distributed system, when we have a certain grid connection, it's the higher amount of transactions, higher amount of sale of electricity. That's the main argument with the distributed charging system that you can provide. When you look at the commercial vehicle side, the main idea is to deliver kilowatts, most efficient way. Especially for passes, this is actually that you can do more performance with less power, which means lower investment as total. Even the cost of the goods is not relevant. It's the outcome. So these are the two aspects from that point of view. And I think it's kind of going for the modern charging system is like a scalable solution, more future-proof than the legacy standalone idea that you can grow the networks and you can grow the systems after the installation and naturally do this. And easily update. Yes, this is the idea. Thank you. Thank you for very many questions and active discussion. And like we did after the last quarter report, we will publish questions and answers on our investor website within a few weeks or within a week. Let's see how we can handle the questions. Before we close the line, we go to the city of Kaunas in Lithuania, where our customer Eleport has recently opened the largest charging hub in the Baltic countries. Check it out and thank you all.