Hello, and welcome to the Vaisala third quarter earnings call. Please note this conference is being recorded, and for the duration of the call, your lines will be on listen only. However, you'll have the opportunity to ask questions. This can be done by pressing star one on your telephone keypad to register your question. If you require assistance at any point, press star zero, and you'll be connected to an operator. I will now hand you over to your host, Kai Öistämö, to begin today's conference. Thank you. Thank you, and welcome, also from my part to Vaisala's third quarter earnings call. I'm accompanied here with Ville Voipio, our Chairman of the Board, Heli Lindfors, our CFO, and Paula Liimatta, our Head of IR. My name is Kai Öistämö, I'm the President and CEO. Our third quarter really was characterized by increasing profitability following improvement in gross margin. If we look at our net sales, slight decrease of 2% compared to the year before. If we take constant currency, that would have been actually 2% increase. Order book ended at EUR 166 million, and as said, operating result improved year on year. EBIT ended up at a little bit over EUR 25 million. And the cash flow from operating activities returned to what I would characterize as a normal level as we were predicting. So if we take a little bit closer look into the numbers, the orders received wise, there was a decrease by 8%, that came from both business areas, especially on Industrial Measurements, but I'll get to the more detail when I go through the business areas. And if we look at the market segments, there were multiple different market segments which contributed to this, and again, I'll give you more color when we go into different business areas. As said earlier, the order book ended up at EUR 166 million, on roughly the same level as last year, which I would characterize as a good level given the market environment at the moment. I already mentioned in terms of the net sales, we experienced a decrease by 2%, which would have been a growth of 2% in constant currencies. When we look at where did it go, with what business areas contributed how? So Industrial Measurements decreased, and Weather and Environment was in previous year's level. In terms of market areas, growth from Renewable Energy, Roads and Automotive, as well as then Power and Energy market segments. Moving on to operating result, or as said, the operating result increased, and when we look at the contribution, the contributors to this, the gross margin improved to 58%, and here we got a the benefit of significantly reduced component spot purchases now, which had now on, on this year, only 0.7 percentage point negative impact, compared to 4.2 percentage point negative impact, same time, same time last year. Improved gross margin, and then on the other hand, on operating expenses, we were on, at the previous year's level, and there, obviously, when we look at the between the quarters within the year, we typically have a seasonality in the operating expenses, whereby the third quarter is the lowest in, in, within a year in, in operating expenses, driven by holidays, lower activity, and so on, in, in the, in the third quarter, and same, same thing happened this year as, as in the previous years. That all being said, we continued our IT investments into the new ERP system, which we are planning to go live early next year, as well as we continued the key investments on sales and marketing, as well as in R&D, to ensure the long-term competitiveness of the company. Then, if I move on to a little bit deeper look into the two business areas, starting with Industrial Measurements. In Industrial Measurements, the orders received decreased by 14% when compared to the same time previous year. The decrease was in Industrial Instruments, Life Sciences, as well as in the Power and Energy market segments. The foreign exchange rates were also impacting here. The decrease would have been only 8% in constant currencies. If we look at where specifically did it come from, the Chinese yuan, Japanese yen, and dollar contributed mostly to this FX impact. In terms of market share, we believe that we did not lose any market share. We did not gain market share either, so the market share was stable, just like it has been during this year in the previous quarters. In terms of operating result, we did improve the operating result despite the decrease in net sales. The net sales decreased in Life Sciences and Industrial Measurements instruments market segments. At the same time, the gross margin improved to 64%. And here, again, the same thing as on Vaisala level, the positive impact on significantly reduced component spot purchases compared to the same time last year did contribute quite a bit positively to this. The continued market environment where unfavorable market mix, meaning that focus on older, older, older products as well as then some price pressure continued, then burdened, on the other hand, on the gross margin. In operating expenses, we were on the same level as third quarter previous year, and this all then resulted that the operating result was at previous year's level, at that almost exactly 14.7 million euros, EUR 100,000 more than the year before, being then 27.3% of net sales. Moving to Weather and Environment, when we look at orders received, we were roughly on the same level as the previous year. Then, variations in the different market segments, Meteorology somewhat decreased, very strong on Aviation. I would characterize this, that normal kind of variance between the different quarters in these markets. This is what we kind of typically experience as well. The order book increased by 7% to EUR 131.5 million. Maybe it's worthwhile here as well, that if we look at the orders received, actually slight increase, if we again look at in the constant currencies. In terms of an operating result, the margin again improved. First of all, the net sales grew strongly in Renewable Energy, roads, and automotive, but then sales decreased in Aviation. In this quarter, again, driven by various different projects in Aviation, that you notice the discrepancy on strong in orders received, weakness in net sales. This is again the normal variation between the quarters in this more traditional market segments that we have. In terms of gross margin, similar increase as in Industrial Measurements. There's clearly a tailwind from clearly lower spot purchases or costs related to spot purchases, now only being 0.6 percentage point negative now, compared to the 2.5 percentage points negative year before. The other positive contributor to the gross margin was higher share of more profitable products, as well as higher share and growth in the subscription sales, which have a high gross margin and thus accreted to the overall gross margin. Overall, the result of this was that the operating result increased to 13.7 percentage points of net sales. Good quarter in Weather and Environment. If I move on to where are we faring within the year? What was the situation after the first nine months of 2023? I would characterize it as, as the headline here says, "Resiliency, net sales and operating result," slight increase to the same time previous year, in a growth of 5%, constant currency-wise, actually would have been 8%. Gross margin on a similar level as previous, previous year. Operating margin, slight decrease, and again, driven by the incremental or the investments that we have been doing on what I would characterize in, in a, kind of a normal course of business in terms of R&D and sales and marketing, as well as then the significant investments that we have been doing into the IT system renewal. This all resulting into roughly flat on EPS earnings per share, if we take that metric. Cash flow-wise, as I said in the opening slide, we are back on a normal level in terms of cash flow. Nothing dramatic on this. As we've indicated before, we've been able to deliver on the promises on getting kind of a more normal level in terms of cash flow. This leading into, if we look at the financial position, again, the same headline I've been showing for the past three years, strong financial position, so no news on this. We essentially, if we look at our net cash position, we are essentially net, net debt-free, and all the financial metrics show a very, very healthy, healthy company. Then maybe to kind of interesting parts of the call for you. On the market development for the remaining part of the year, the only change in this would be that we see now a slowdown in not only in Life Science, but also in high-end Industrial Instruments, driven by the uncertainty and lack of new investments by our customers. We are not seeing kind of big new factory investments, big new renewals of production systems or investments into warehouses and laboratories and things of that nature, which would be driving really the high-end instrumentation growth. Partly, probably also, at least in part of our customer base, in their own business, and this is not a reference to our sales channel, but our customers' sales channel, that the sales channel has been relatively full and, given the uncertainty in the marketplace, it has been, you know, they have been digesting the higher than usual sales channel, leading into, again, slower investment decisions than usual. If we look at the business outlook for 2023, no changes on this, we continue to see net sales being between EUR 530 million-EUR 550 million, EUR 560 million, and operating result being between EUR 65 million-EUR 75 million. If I just summarize, the third quarter, the profitability increased following the improvement, improvement on gross margin. Net sales essentially flat compared to previous year. Order book on a healthy level. Operating result actually increasing to the same time previous year, and cash flow on kind of a normalized, healthy level. With that, I would like to conclude and open up for any questions that you may have. Thank you. As a reminder, if you would like to ask a question or make a contribution on today's call, please press star one on your telephone keypad. If you change your mind and want to withdraw your question, it's star two. Please ensure your lines are unmuted locally as you'll be prompted when to ask your question. Our first question comes from the line of Pauli Lohi from Inderes. Please go ahead. Thank you. I'm Pauli Lohi from Inderes. Thank you for the presentation. I would like to ask about the subscription sales growth. It slowed down some from the previous quarter, so this is seasonal variation or new normal? It's a seasonal, seasonal variation, and there's a little bit on the year before. There was a one-time, one-time booking of, of net sales also, which made the comparable a little bit more difficult than, than in the second quarter. That's part of the explanation and part of it, explanation is seasonality. You have to remember also that, that we have a somewhat strange, data sales business where one, say, customer segment is this winter maintenance related, for road authorities, and those subscriptions typically last only during the winter month periods of, on the northern hemisphere, i.e., fourth quarter and first quarter, and therefore, we have like a maybe unusual to typical data sales business. We have a little bit of a seasonality in terms of just as an underlying part of the business. Thank you. Then I have a question regarding the demand direction in the Industrial Measurements. Did we experience a downward trend in new orders during the quarter, given that the new orders are weaker than sales growth? You are asking within the quarter, I guess? Yes. No, the answer would be no. It, it's, it was weakness throughout the quarter. Okay. Then, finally, regarding the sales, marketing, and admin expenses, they slightly declined year on year, so why is that? Have you done certain measures to cut costs? Yeah. Yeah, yeah. So as we indicated last in the last quarterly call, we put in spend restrictions across the company on essentially a hiring freeze, and kind of reductions and cautious, kind of a significant cautiousness on discretionary spending, spending on external consultants, travel, that kind of natures. Okay, that was all from me. Thank you. Thank you. Our next question comes from the line of Atte Jortikka from Evli. Please go ahead. Hello, this is Atte from Evli. Thank you for taking my questions. I have just two quick ones. First, going back to the price competition and we obviously saw it in China this quarter. What's the effect on the gross margin, higher this quarter when comparing to Q2? And how do you see this going forward to Q4? No, it was not. I think here, when thinking about the price, price pressure, you know, as usual, you know, more commodity type, more low-end type of products, more you typically also experience price competition. So that my comments on the mix and the price pressure were kind of related in that sense. Okay, thank you. Then, the second question on the project sales, those have been on lower levels throughout the year. How do you see on Q4 and then going forward to 2024? We are not giving guidance on that level on Q4 and so on. I would say, but it's a fair question on the quarters that have passed. I would put that within the normal variation, like, typical to our business. We have not kind of received or booked any major orders, like the Ethiopia was last year. Obviously, some of the Ethiopia project was implemented during this year, but nothing new on the same kind of a scale has been coming in. Obviously, quite a bit of smaller projects, but nothing to the scale of Ethiopia or Vietnam in the past years or that type of a thing. Okay. That was all from me. Thank you. Before we proceed to the next question, as a final reminder, if you would like to ask a question, please press star one. Our next question comes from the line of Matti Riikonen from Carnegie. Please go ahead. Hi, it's Matti Riikonen at Carnegie. A couple of questions. First, regarding the gross margi n in Industrial Measurements, you already said that the spot component burden was kind of relieved in Q3. But even if we exclude the kind of spot component additional cost from this quarter and the one year ago quarter, there is a quite big difference, actually 2.7 percentage points. So I was just wondering that when you said that the unfavorable product mix had an impact on Gross Margin, was that the only kind of component that was weak in addition to negative operating leverage, of course? Or is there some, d id you make any cost savings or some changes in the cost base in the delivery organization in IM that would explain that? Yeah. Hey, Matti. So good question, and short answer is no. And so they were kind of like the biggest contributors, as I was saying, was the unfavorable mix, and related to that, the kind of a price competition in more volume type of products, which continued. As well as then obviously, as you yourself said, the operating leverage that our business leverage is kind of the gross margin scales well with increasing volumes and then some not so well when decreasing volumes. So there's a little bit of that as well. All right. And then your APAC sales were down. Is it mainly related to China or, or is it broad-based in the whole of APAC? It's, I think, mostly impacted by China. You have to remember that, as I said, in terms of the currencies, the biggest headwind actually came from yen or yuan and then dollar, and all of the APAC sales obviously are foreign denominated. All right. And then, do you have some kind of idea how the Chinese demand would continue after Q3? Is there any talks with the customers or your delivery partners? Do you have any- Of course. Insight on what is happening inside China? Yeah. So obviously, we are on a daily basis talking to our customers and so on. And I would characterize it this way, being in China just relatively recently, there are some new government policies trying to revitalize the overall economy. I mean, our demand is to some extent related to overall, kind of like how well the investment activities and industries overall fare. So there's some kind of a government policy is more kind of more favorable government policies on that side. On the other hand, the uncertainty, they are not immune either for the uncertainty in the world or demand side, especially. You know, think about, for example, electric vehicles. While we are not selling a kind of, we are not exposed to electric vehicles per se, but even if they are increasing, they are probably not increasing the sales as much as they were forecasted, which then goes back to, say, lithium- ion battery manufacturing, where we are supplying. And you know, the investments into new battery facilities is really on a lower level this year, despite the fact that the electric vehicles, for example, have been selling well, but not as well that somebody might have forecast. And then I'm using it as just as an example. And so China is not an isolated, but it's also related to it, and very much the exports that they are selling outside of China. All right. Thank you. I think the rest of my questions were already asked in the presentation. I think there was quite a good set of, kind of clarity or transparency regarding the end customer sector, so thank you for that. Thank you, Matti. That's all from my side. Thank you, Matti. There are no further questions, so I will hand you back to your host to conclude today's conference. Thank you. Thanks for listening, and in case you have any further questions, you know how to contact us. Paula is the right person, and we would be happy to jump on another call, another occasion to give you any more or answer any more questions that you may have. So thank you, and have a great weekend. Bye now.