Good morning, everybody, and welcome to Lamor's Q1 webcast. My name is Johanna Grönroos. I'm the CDO at Lamor, and together with me, I have our CEO, Mika Pirneskoski, and CFO Timo Koponen. We will follow the normal webcast agenda, starting with the operational highlights which Mika will present, continuing with Timo's financial update and guidance, and then we will talk a couple of word about strategic initiatives and where we are going with those initiatives currently. We will close as normally the session with Q&A, so please provide us questions so we will answer those as well during the webcast. Starting with the operational highlights, what would you like to highlight? How are our big projects proceeding, and what are the main steps taken there? Okay. If we start with the alphabetical order and start with Bangladesh, I mean, we disclosed the order H2 last year, had some progress early in the project, and then everything has been continuing as planned. We don't see any potential risk for delays from our perspective in that project. Then again, I mean, it is in a developing countries, and it includes certain infrastructure being built in the country. In the final stages, the commissioning could take a little bit longer than expected, but that shouldn't affect our technology deliveries at all. If we move towards Kuwait, Q1 was a significant milestone for us. We completed the enabling phase in time. We've started the remediation work already. We've done significant progress in transporting the contaminated soil to our treatment centers, and Q2 will be the Q1 where we will actually do some of the remediation activities. Saudi Arabia, finally, some good news from there in terms of receiving some of the money. It didn't come as early as we had hoped for, so it was a couple of days after closing the quarter. Altogether, in terms of Saudi Arabia, things are in maintenance phase. We are seeing a lot of progress in terms of the working capital situation there, so all going as planned. Good. We've been talking quite a lot about the chemical recycling initiative. Yeah. Any short update? We'll go into the details a bit later, but. Yeah, I mean, exciting times ahead. We've done a lot of work this year. I mean, we did the first closing in the closing days of 2022. A lot of progress has taken place since, and hopefully in the coming weeks, if not months, we'll have some super interesting things to share about that as well. Excellent. A couple of words about the revenue profitability and guidance. The revenue was significantly. Yeah Compared to last year. Yeah. What are the stories behind? That is completely true. I don't think we did ourselves any favors last year because of those two spills in South America. It really set the bar super high for, especially for Q1. I mean, if you take away those EUR 29 million in revenue from Q1, I mean, you can still clearly see that we are on a growth path in terms of our base business. At the end of the day, I mean, these emergency response operations, they are part of the business a nd the tragic part from investor perspective is that you can't really forecast when they take place. I mean, what we need to ensure is that we have the organization in place, we have the capabilities in place, we have the assets in place to act when something goes badly wrong. From that perspective, we are still going in the right direction. To be frank, I tried to touch upon this, at least in the analyst interviews last year, that we'll probably see a slow start of the year, and then things will pick up towards the end of the year. Then if we go to the second part of the questions, seems that I'm a man with many words this morning. As discussed already in the full year 2022, we made significant investments in scaling up our resources, being ready to deliver our long-term financial target. That can clearly be seen in the increased fixed expense level. Then again, I mean, it was calculated. We have a great potential in our key markets, and we feel that it's justified. Frankly, reporting quarters is probably not beneficial for our business, but it's part of the game, so what can you do? Any comments now that you mentioned about the long-term target? Any comments about the size of the sales funnel currently? How is it going? I need to be careful here not to disclose too much, trying to comply with the rules and regulations. I mean, I can safely say that the sales funnel is larger than it's ever been in our history. We did the strategy update last year. We changed our operating model. We invested quite heavily in local presence in terms of PD and sales functions. We are really seeing the benefits now already nine months into this project. Very confident about the people that we've recruited. Very confident about the sales pipeline. I mean, we are in large scale business with customers that are either large governmental organization, large international companies. In most cases, it is a tender process and we have some past experience, not in the large scale, but in the smaller scale that some of the competition will put so low prices that it's not feasible for us. When the project size goes larger, we tend to see that a lot less. I mean, tenders are tenders. We have a quite a nice track record on that front from the previous few years. We've now started having a larger portfolio of tenders that we take part in. In the past, I mean, we had very limited resources, so we had to select very carefully where to tender, where to play. Now as we take part in more tenders, I mean, I don't think we can continue with our 100% success rate until the end of day. Probably there are gonna be some losses, but with this sales pipeline, I'm quite confident that we'll be able to win some of them and hopefully the most important ones. Excellent. Moving on, quarterly development of the revenue and adjusted EBIT. Please comment maybe starting with the highlights relating to the revenue and adjusted EBIT for the first quarter. If we look at the revenue EUR 22.8 million for 2023, we take away the EUR 29 million for the two spills in Peru and Ecuador, we are still on a significant growth path. If you look at the time series, we can clearly see that Q1 was heavily impacted by those two spill projects. For Q3, we made some significant progress for the enabling works in Kuwait, especially in terms of building the treatment centers. We started to equip them at that time, so that drove the revenue up a little bit because of percentage of completion revenue recognition principles. Q4 and Q1 this year, I mean, there isn't much difference. I mean, some of it's obviously timing, whether it's at the end of the quarter or just before the closing. Again, if you take away these single incidents, if you like, that drive the revenue up and down, there is a trend in terms of the basic business and it's upwards. Basically you're saying that, also going forward there will be ups and downs in these kind of quarterly follow-ups. Like I mentioned, I mean, we are still partly an incident response business, and then if we have a significant event, it can drive the revenue up pretty fast. Then again, I mean, if you look at the base business, we're looking to increase the volumes gradually. Then again, I mean, in terms of Kuwait, for example, the treatment process is cyclical, so we estimate that each treatment cycle will take approximately 90 days. How that treatment cycle will then be timed, it could drive some fluctuation. All in all, I mean, we said that we see that the trend is upwards and of course, with the potential that we have in our sales funnel, we hope that we will have a larger portfolio in the future that will then drive down the fluctuations. Good. Moving on to the chemical recycling initiative. You opened up a bit where we are currently, but can you describe a bit more in detail from operational perspective what is actually happening? Yeah. I think even though we've been building treatment facilities in the past, it's been typically a different type of business model where we have first the waste stream secured by the client, then we build the facility, or design the process, build the facility and start operations. Again, I mean, this business is a little bit different. I mean, it is a value chain business. I mean, you have different players in the value chain and we start with the collection part. You have the logistics part, then you have sorting, or you could have mechanical recycling before the sorting. It depends on the type of operation that you have. After that you have the chemical recycling and then you have the offtake for the end product. The business model is a little bit different. I think, when we went into this project, I mean, there were some lessons to be learned for us, how to build the business case. We've done significant progress on that front. We've modularized the design. Currently the blueprint is such that it can be replicated. The blueprint is such that it can be scaled up pretty easily. I think the team has done a marvelous job early this year to really build a very nice blueprint of what our facility and how the value chain will look in the future. Any other, like, concrete actions taken that you could open up? I mean, we've finalized the process design. We changed quite a lot of the tech providers that had originally been chosen. We invested a lot more in the pre-treatment part of the process than we, for the chemical recycling technology, we went with the European manufacturer at the end to be sure that we comply, for example, with the EU emission regulations and EU Taxonomy on a broader scale. Then again, I mean, looking at feedstock and offtake, we've made some significant progress there and hopefully we'll be able to disclose a bit more information about that in due time. Any red flags you would like to raise for what comes to the plastics initiative? I'm not the best person to talk about red flags. I mean, you know, my glass is always half full. Of course it is a new business with a lot of caveats, but if I look at it from sort of the downstream perspective and if I look at the investments that some of the petrochemical industry or players in the petrochemical industry are doing, the indication in terms of the price development of the end product, I'm really encouraged. There's a lot going on. There is some estimate that the need for this type of raw material in petrochemical industry is a minimum of 10 million tons by 2030. A lot is going on in this industry and partially the reason that we sort of jumped into an ongoing project is to get the first mover advantage here in Finland. Try out our distributed liquefaction idea or solution, and then take that to our strategic markets. You mentioned about this facility in Porvoo to be the blueprint factory. What are the plans for the next steps? In the first phase, I mean, it is a 10 tons capacity, but as mentioned already, I mean, the design is such that if we find suitable raw material, if everything goes as planned, we can pretty easily scale up that volume there in Kilpilahti. Again, I mean, as communicated earlier, the plan is to build a 40 tons capacity here in Finland, and a decentralized 40 tons capacity. The other location is still under discussion. We have a few ideas but we are quite confident we really see the need. If we look at the bigger perspective, and if you look at what everybody's trying to achieve in terms of plastic waste is to increase the recycling rate. Basically increasing the recycling rate will require a combination of both mechanical recycling and chemical recycling and potentially other alternative technologies as well. It is very much in the scope of all the plastic producers, all the plastic users that the recycling rate will go up. The market trend is super positive from our perspective, and it seems to be strengthening in every week or every month. Good. Thanks for the update. About the soil remediation projects in Kuwait. Any, so to say, highlights, what is ongoing? You opened it up a bit already. Yeah. A bit more in detail. Of course, we already have 500,000 tons of soil in our treatment areas, and on paper or in a slide that might not seem like a lot, but it is quite a few truckloads. It is quite a few biopiles. It is a lot of soil to be treated. Amazing achievement from our team, first of all, to finalize the enabling phase in time. Our project there in north is ranked number one among all the projects, super happy with the performance of the team there. Some catching up to do with our south team, but we are doing the best we can to create a healthy internal competition in terms of performance. As said, I mean, we expect the progress to speed up this year. We are quite confident about the technology choices that we've done, for example, in terms of soil washing. All in all, I mean, super happy with the performance of the team and then potentially some positive surprises in terms of progress for this year. Inshallah, as they say in Kuwait. Maybe a small question with a short answer about the technologies we are using. We're talking about bioremediation and soil washing. What does it actually mean? With a short answer. Yes. A short answer. Bioremediation is basically that we enhance the biological capabilities of the soil to treat itself in a way. What we do is that we add nutrition, we add some moisture, and we've designed a bacteria population to degrade the oil. If you look at that alternative compared to any other technology from, for example, emission perspective, it is a lot more environmentally friendly. A lot of the emissions will be absorbed by the soil and used by the bacteria. The emissions are super much lower than in any other technology. In terms of soil washing, I mean, what we've seen from the competition, I mean, they've gone with sort of a small-scale modular system. We went with maybe the Rolls-Royce of the market, paid a premium, but we believe that it's it is the most robust soil washing technology available. Super confident that it's gonna work wonders there. We talk in our strategy a lot about having the anchor contracts in certain countries. Kuwait for sure being one of them. Anything you would like to share when it comes to that? Yeah. Of course, I mean, these Kuwait projects are really, I mean, flagship projects in the environmental solution market at this moment. Of course, for our brand, it's been super helpful, especially with KOC, and we are already seeing some traction there. Following our strategy, winning a anchor contract, establishing ourselves and then utilizing the position to cross-sell. Good. We'll move on. Thank you, Mika. We'll move on to the financial update and guidance, and Timo will continue. First of all, some key figures. What would you like to bring up from these figures for this quarter? Yeah, obviously, a lot of it was already kind of explained and elaborated by Mika. If picking up the obvious ones, the revenue EUR 22.8 million for the quarter. First of all, that was very much as we had planned it. Obviously, the big point there is to, when comparing to like-for-like basis to last year, then we have to really understand the big effect by those two emergency projects we did in EUR 29 million should be taken out. In that respect, no surprises. Of course, when looking at the percentage change, that's a big mover. Then obviously that falls down into the EBITDA and operating profit accordingly a nd the double effect we have in EBIT obviously is that since the volume is relatively low, then the relative share of the fixed expenses, which was also elaborated earlier, is higher. So kind of that highlights or magnifies the effect. Other than that, no big things there. Obviously, when we look at the number of employees, for example, at the end of the period or average and look at it at the comparison period, once again, we can see the big magnitude we had a year ago. The growth we have had in the number of employees now since the year-end is relating to Kuwait, which is now really picking up in terms of the soil remediation operation. Good. We have the revenue split on the picture as well. We don't actually have the comparison for compared to previous year. Any comments about that? Middle East and Africa being now the biggest one. The graph was completely different when we have a look at the Q1 2022. No, yeah. Now, the revenue is driven by Kuwait, Saudi. Bangladesh is picking up. Those are the big movers there. A year ago, obviously both Peru and Ecuador made the graphs, being Americas heavy. That's the big swing as we have elaborated. Good. Moving on to the order backlog and order intake. What's the message here? Now, as the headline says, order book remains to be very strong. When then digging little bit deeper, and what is of course the most important when looking at the this year's performance and looking at also the guidance, EUR 73 million is the part of the order book that is going to be revenue recognized this year. The way we should look at it is then that putting that together with the Q1 revenue, it means that we have EUR 96 million in the books for 2023. That of course gives us a lot of confidence to hit whatever we have guided. Orders received, EUR 11 million for the quarter. It is clear that it doesn't include any big-ticket items, but it's more a continuous day-to-day business that runs smoothly. Then as we said also a few months back when releasing the 2022 full year numbers, there are several prospects in the pipeline we are working on. Some of them are in tendering phase, and we are already in there and some of the discussions are still to come. Good. Waiting to see this later on as well, how it looks like. About the working capital. We've been talking about this a lot as well. As Mika already mentioned, the Saudi situation changing a bit. What about the Kuwait? What's the situation there? Now we can also see that in Kuwait the growth has stalled. We are still gathering or generating a lot of contract assets since we are recognizing the revenue based on the progress. One thing obviously is that when we look at the bars on a picture, it looks very static, but there's movement all the time going that the new items are entering the contract assets and then they are maturing to the accounts receivable and then like the Saudi EUR 6.8 million had that hit the right side of the quarter, and obviously that would have changed the picture drastically. Kuwaiti situation in general, as we have said earlier. A lot of the invoicing, a lot of the progress, is tied to the soil remediation operation progress itself. That will also then mean that the invoicing and the revenue will start catching up. The contract asset generation will slow down the further we go the year. Good. Any comments about equity ratio or net gearing? No, that starts to be dull. What we have said already from the beginning, obviously from IPO, the financial position remains very strong. Obviously, since the growth ambition is there, what we have stated earlier, that enables us to any further leveraging if so decided. Good. About the guidance. We said that it's unchanged. Anything you would like to highlight? No, yeah. Basically we have reiterated the guidance word by word. No changes there. I believe we have given a pretty profound explanation why we see it that way. Maybe the only highlight I'd like to make, but what also referred briefly by Mika is the first statement there that we have the order backlog. We know where we are, where we are heading, but obviously, since the revenue is generated by this large service project deliveries, there are changes. It's a dynamic picture that changes on a daily basis. We have to remember that it may change on either direction. It doesn't mean that it's anything negative at all. I mean, the situation is dynamic and as well as the tenderings we have set the timing, our success. It's all about that. Good. All right. Thank you, Timo. That was all for the financials. Before moving on to the Q&A, let's highlight a bit about what is the progress we've been making when it comes to the strategic initiatives. We launched the updated strategy and Vision 2025 in November last year. Now of course, fully engaged to meet these targets as a whole company. Would you like to highlight something, what has been happening now during the first quarter of this year when it comes to the entering the three new markets and winning five new projects? Maybe I would like to start with the number one partner in select strategic markets. As briefly mentioned about Kuwait, for example, we see a great potential and a strong link with our performance in these key projects to enable our small business in the future. That could fall under the five new project to solve significant environmental challenges in the near future as well. If you look at the capital market recording, for example, about the plants in Saudi Arabia, still intact, but as could be typical for Saudi Arabia, the plans are quite ambitious. Whether they will be realized as per the schedule stated at least semi-openly, that is a question mark. Two very strategic markets in the Middle East, Kuwait, Saudi Arabia, and potentially some of those five new projects would come from those areas. If we look at the three new markets, we look at our footprint in South America, there are still some uncharted territories for us. We communicated, can't remember whether it was early this year or late last year, that we opened Brazil again after a few years of hiatus. Seeing some very nice potential there as well. Could be potentially one of the new markets. If we look at the other locations, there is significant potential in Southeast Asia. We're working heavily on that, maybe a bit more down the strategy period, not most likely this year. The success in the Middle East is definitely helping us with some potential in the neighboring countries. We know the history of that regional continent. A lot of environmental damage has been incurred over the past 20, 30 years. Not much emphasis on sustainability, on environmental values. Now, and I think this is probably the worst example that now the environmental regulators are really starting to take things seriously as the contamination has started to impact people's life in terms of VOC emissions, for example, deterioration of citizens' health and the contamination of groundwater as well. From human perspective, the things are not very good in some of these market areas. From business potential perspective, we see a lot to be done there to help the local people. We already talked about the plastics initiative. Anything you would like to highlight on the Lamor way of working? We are talking about quite a lot. Yeah. This is originating from our original globally local thinking that we have the global part, which is the way we operate, processes, quality programs, quality standards. I mean, we want to be felt the same. We want to look the same everywhere we operate. Having a global portfolio executed with the same process everywhere we operate. Now what we've done is that we've had the local part mostly via partnerships in the past. We've had agents or we've had a local partner. What we've now done a bit differently is that we've strengthened our own market area operations quite significantly. We brought Lamorians to be local as well, rather than relying on outside partners, third-party service providers, if you like. I think that is the key that we make the dynamic work with the local portion and the global portion, and that will make us a lot stronger. Good. You talked quite a lot about sustainable development already when we talk about the strategy, and I guess the key is really that sustainability is within the strategy. As we when we publish the annual report, we publish a sustainability report at the same time and followed for the first time the Global Reporting Initiative. Maybe highlighting here that we can see the same wordings here when we define the material topics enabling environmental protection and efficient material recycling, protection of biodiversity, efficient use of natural resources, and climate change mitigation. Those are the so to say, material topics we have defined what we are searching for and really tightly combined with our strategy. Of course, there's also sustainability. You already mentioned about the people aspect in the areas we are working with and of course, really important topic for us as well. How do you see we are committed to green transition as well and doing things better all the time. What would be the thing that you would like to raise up what we are doing when it comes to the green initiative? Yeah, I would. Short answer once again. Yeah. Maybe Yeah. Maybe I'm repeating myself, but if we look at the first bullet point there, efficient material recycling, I mean, that is most definitely the most important part for us and that means recycling of plastics. I mean, if we look at the, t his is not gonna be short. If we look at the roadmap to carbon neutrality, I mean, we have the roadmap for replacing fossil fuels as energy source for transportation, for example. When we look at the chemical or petrochemical industry, we have a lot less concrete actions taken in that part of the carbon neutral roadmap or pathway. We believe that being on the forefront of solving the issues in the petrochemical industry will give us a very nice market position from the sustainability as well as from the business perspective. Good. I guess what comes to the reporting then, of course, we need to measure as well that we meet those targets and guidelines as set by the EU regulation as well. Correct. Practically what it means, for example, for chemical recycling of plastics, that there is no way that we can chemically recycle plastic that could be mechanically recycled and that's of course from EU Taxonomy compliance perspective super crucial for us. I guess the same applies for whatever we talk about soil remediation or other services we are providing, same applies there. Yeah, correct. Continuous reporting needed. Good, and improvements as well. That was all for the presentation. Then I'll ask, Timo to join us as well, and let's move on to the questions part then. Kuwait, continuing there, remediation work has started. Does it mean you have actually remediated, tons already? If so, could you share something about the learnings you had from the process? For example, efficiency of the cleanup and pass through time in the process. As mentioned, we completed the enabling works by the end of February. The enabling works had both bench-scale and pilot-scale testing of the remediation technologies that we use. Going into the remediation phase, we had a very good understanding of the efficacy of the processes being used. We tested several different technologies. We tested several different recipes for bioremediation, for example. We have a very good understanding of what works and what not. I already mentioned that the treatment cycle is expected to be 90 days. For the less contaminated bioremediation, that's probably a bit on the long side, but then again, if you look at the matrix, from 1%-5% contaminated soil, that's a good average estimate. As mentioned, I mean, the remediation activities have started, and more on that probably on the Q2 webcast. Good. A question to Timo. You imply that the revenues and profitability will be stronger in H2, supported by the startup of the remediation work in Kuwait. How we should think about Q2 from this perspective? Obviously, we have to leave that before we enter the H2. We expect without now making any promises we cannot hold, but I mean, we expect the works being accelerated, for example, in Kuwait and also the progress in Bangladesh. It follows the normal S-curve. It's, I won't give any number, but that's the direction we are heading. I guess, there is another question also relating to how has Q2 started, but I guess we stick on what you already covered. Then, either one can take this one. Do you see potential projects that could contribute meaningfully to revenues already in 2023? If Lamor would win, any major projects still during this year? I'll give a high level answer. I mean, as Timo mentioned, we have EUR 96 million in the order backlog plus the booked revenue for this year. I think the question is self-explanatory. If we didn't see that, we'd have to say, change the guidance and we see no reason to change the guidance at this point. Anything else, Timo, you would still like to add on the guidance part compared to what, where we are from the Q1 perspective? No, no, that's, that's how it is. As we have said also in our communication and the guidance itself. How do you see the Kuwaiti project, which is now have been discussed through quite thoroughly today as well? How do you see that impacting our future potential and ability to win new projects? If we go to the learnings and the experience and the references we've gained, I mean, if you look at remediation projects, I mean, we can walk through any door today and proudly claim to be one of the leading providers of bioremediation or soil washing technology. Of course, that's given us a huge amount of credibility in the eyes of our customers on a global level. I mean, there's no one in this industry who wouldn't know about these projects taking place. Again, if you look at our performance in Kuwait, of course, there is a lot of budget to be spent. As mentioned, our North project is now the number one of all the projects there, and good performance on these current projects will most likely lead to significant new business also with regards to the KERP projects. Good. Maybe as a last question, about plastic still. What are the methods made to make sure that it is a sustainable project and meeting the CO2 emission targets set for it? Yeah. So very good, interesting question. There's no short answer to that. If we look at it from LCA perspective and look at the feedstock, we need to increase the recycling rate with the feedstock that we use. Basically, the raw material that we use in our chemical recycling process needs to be a raw material or feedstock that doesn't go for incineration or to landfill or some other purpose that's not supporting the circular economy approach. There we get huge savings, of course. Then when we look at the process itself, of course, we need to take into account the EU standards in terms of emissions and use as energy efficient process as possible. The process itself, creates, pyrolysis gas that is being utilized, as an energy source, to run the process. Once again, I mean, when we look at the external energy consumption, I mean, we are committed to use renewable energy to the part that is not sustained by the process itself. Good. Any final words from one of you? I think, I've had quite a few words already today, but I mean, putting things into perspective, and as mentioned in the beginning, we did ourselves no favors with the super strong Q1 last year. The revenue and the profitability could be a bit of a disappointment for some of our investors, but we are still committed to deliver the guidance for this year and remain on the growth path. Excellent. Thank you, Mika and Timo. Thank you. Thank you all of you who joined the webcast.