Good afternoon and a warm welcome to this 360 Capital Markets Day event focused on digitalization and broadcast to you live from our headquarters in Reykjavik, Iceland. I'm Tinna Molphy, head of IR, and I will be your host in the 2021 Capital Markets Day mini-series, all aimed at giving you a 360 view of how we will deliver growth globally, digitally, and sustainably. Digitalization is reshaping the industry as we know it. By combining software and mechanics, Marel has become a leading innovator of solutions to meet the world's food processing challenges and opportunities. Today is all about the digital journey ahead. A new architecture of digital products that will increase speed, scalability, and the intuitiveness of our solutions while increasing uptime. I'm joined by our Chief Strategy Officer, Árni Sigurðsson, Executive Vice President Hjalti Thorarinsson, and EVP of Innovation, Anna Kristín Pálsdóttir, who will take you through their keynotes in just a moment. Moving into Q&A in about 40 minutes' time, Roger Claessens, our Executive Vice President for Marel Poultry, will also join the panel discussions. In fact, Roger is at the new Bell & Evans plant in Fredericksburg, Pennsylvania. This state-of-the-art greenfield poultry processing plant was, of course, a landmark transaction for Marel, announced back in February 2020, and I'm sure Roger will bring great customer partnership to the discussion. If you would like to ask a question during the Q&A, please use the link below or email ir@marel.com. The full deck of detailed slides are available for download. Just click the link at the bottom of your screen or visit marel.com/cmd360. If you have any problems with downloads or posting questions, please do email the IR team and we'll do our best to help. Let's set the scene as to why today's topic, digitalization, is important in terms of our 12% growth target. Today, revenues from software as a service are in the low single-digit range, and the aim is for a significant step up in the coming years. Our cutting-edge software already has the largest installed base in the food processing industry, and we are introducing new digital products, which will be a self-standing software revenue stream, and this will start to reflect more prominently in revenues from 2024 onwards. Digitalization is also the foundation for predictive maintenance, which will lead to a stickier customer base for Marel as a trusted maintenance partner, and in turn, drive higher customer engagement, higher recurring aftermarket revenues, and higher share of wallet. With all that, I'd now like to hand over to our Chief Strategy Officer, Árni Sigurðsson. Welcome. I'm Árni Sigurðsson, Chief Strategy Officer and EVP of Retail & Foodservice Solutions and Innova Software. I started working with Marel in 2007 during the acquisition of Stork Food Systems and joined the company in early 2014. I've been working since then to help transform Marel to become a global provider of food processing solutions. My passion for Marel and the industry is really around the huge opportunity to create value for our customers and other stakeholders. Surprisingly, it's still quite an immature industry, so we really have the potential to transform the way food is processed, and digital is really at the heart of that. Today with my colleagues, Hjalti Thorarinsson, VP of Innova Software, and Anna Kristín Pálsdóttir, EVP of Innovation, we will give you insights into our digital journey at Marel. I will show you how our digital journey fits with our vision and strategy. Hjalti and Anna Kristín will address why we will be successful, where we are going, and how we will get there. Our vision is clear. In partnership with our customers, we are transforming the way food is processed. Marel's vision is of a world where quality food is produced sustainably and affordably. The digital journey is integral to us achieving this vision. Marel is a global provider of solutions, software, and services to customers across the value chain of raw material to supermarket shelves. Our modular line solutions, market-leading proprietary software with digital solutions across poultry, meat, and fish, will ensure we achieve our vision. Digitalization is not a separate pillar. It is at the center of our strategy and growth. Digitalization will enhance our performance across strategic pillars of our modular line solutions and software, sustainability, and growth. Let's dig a little bit deeper. Through seamless flow of data sharing across the value chain, upstream and downstream, we can and will improve performance. Let me give you a simple example of what I mean by this. Let's take a whole chicken at one of our poultry customers, in, say, the Netherlands. The raw chicken is on the overhead conveyor, which passes through our quality control system called IRIS, and that actually stands for Intelligent Reporting, Inspection, and Selection system. Our digital system in the machine takes photographs and immediately assesses the chicken. Is it bruised, damaged in any way? Any remaining feathers? Is it high quality grade or low quality grade? Based on quality, should it be left whole or should it go to cutting? Our digital system allow our customers to process in the right and optimal way, 15,000 chickens an hour. In the time it's taken me to tell you this, the chicken and another 150 chickens are on their way. I trust you can see how this digital process completely optimizes time waste and efficiency. Our focus at Marel is to develop and deliver standardized digital solutions which will meet our customer needs, whether they are producing poultry, meat, fish, duck, or vegan food products, and no matter where they are in the world. This means that we can create scalability across our digital technology and platform and remain an indispensable partner to our customers. We have a strong software offering today with Innova, and we will enhance that further with new digital solutions. This will enable us to offer a broad portfolio of products, such as overall equipment efficiency, order fulfillment, and predictive maintenance. Let me give you an example of a solution that we're currently working on. A customer who's focused on filet optimization wants to produce fixed weight, three 200-gram chicken breasts in a tray. Our cutting machines is actually sending information into the digital system of what type of raw material it needs. Information gathered earlier in the process, such as weight and quality, are used to decide which chickens actually go to this machine in order to produce exactly what is required. I mean exactly as the customer wants, three 200-gram chicken breasts in his tray, nothing more, nothing less. Because of the accuracy of cutting machine and the data that is used to control the process, there is no waste, and this creates high-value products. This will be a true game changer as we shift more towards consumer-driven demand production. All of our products are designed to help improve performance, sustainability, and quality of their products. Moreover, we'll be able to support our customers in being more sustainable and produce quality and safe food in a sustainable way through traceability, carbon footprint tracking, and production that is matched to consumer demand. All in all, Marel's software and advanced solutions will enable us to transform the way food is processed to customers, consumers, and the environment. As a result, digital is central to Marel achieving its targets. It will fuel our organic growth with an integrated offering. It will help provide a better value proposition to our customers and broader service offering. It will make us a more attractive home for businesses and acquisitions as we have a strong digital platform. It will also simplify acquisition growth as we can create relatively simple connections from equipment to the digital platform. Directly and indirectly, the journey will contribute to the three S's, software, spares, and services, as digital solutions will be sold as subscription with a recurring revenue and often bundled with service and spare parts. Our revenue drivers are clear, and we will have scalability to allow earnings per share to grow faster than the top line. We are moving to being more customer and consumer-driven, and with more demanding consumers, our world is becoming more complex. That applies to our customers as well, who are looking more towards digital to help them win in the market. The main customer pain points are improved performance through yield, quality, and safety, higher uptime with better service and predictability, and connecting the value chain to create a more balanced supply. Some customer pain points that have become more relevant recently, such as labor scarcity, sustainability requirements, and managing the complexity around the number of end food products that have been increasing exponentially over the years. Just 10 years ago, chicken was mostly served in breast, drumsticks, thighs, and wing portions. Today, we have marinated chicken strips, deboned chicken thighs, marinated chicken barbecue skewers, piri piri chicken wings, chicken nuggets, and I could go on, but you get the picture. We need to be agile and flexible enough to meet our customers' and consumers' demand. Digital is at the heart of this. We are really excited because we believe we can address our customer challenges, but we are even more excited that they prefer to work with us due to the existing relationship. As a result of this loyalty, our focus is on execution, having the right talent and delivering, both of which are within our control. Marel is really in a key position to support and partner with our customers and accelerate digitalization of the industry. Our digital vision is to be the digital partner of choice for the food processing industry and enable our customers to sustainably maximize value creation by providing digital products and platform and optimization. There is a lot here to unpack, but what this really means is that when you go to the supermarket and pick up a tray of deboned chicken thighs, you can see and know the origin of the chicken, which is fully traceable, the CO₂ footprint of the product, and the exact weight and calorie count, and that it's been processed in a sustainable way with minimal waste, making sure that the cost is low to make it affordable. This is exactly what makes me so passionate about our digital journey. Technology lies at the heart of Marel. We started out in the eighties with intelligent algorithms to measure the weight of fish catches here in Iceland, which delivered value to our customers. Technology is in our DNA, and that is hard to replicate. With integrated solutions of hardware, software, service, and spares, with scalable platform that enables us to provide the right solutions and connect the ecosystem across the value chain, and with our data that will increase the value of our significant processing know-how, we believe we can deliver better service and products to customers and help transform the way food is processed in a manner fit for the twenty-first century. Our digital vision is all about the Marel vision of transforming the way food is processed, and that quality food is produced sustainably and affordably. This is an excellent way for now to hand it over to Hjalti, who is instrumental in our digital journey. Thank you, Árni. Now, I would like to transition a bit and talk about being successful. We are investing heavily in innovation and digital products, and we have a track record of delivering customer value with those products in the industry. We're able to build on top of this foundation a range of new digital products which none of our competitors can match. First off, we have a very strong foundation in digital, which dates back to the early days of the company. We were doing Internet of Things before the term was defined. In 1994, we worked with a customer to connect a few hundred devices together to provide an overview of their full production. While future success isn't defined by the past, it's an indication of the talent and the capabilities at Marel. Additionally, we're a leader in automated machines with a comprehensive integrated set of offerings. We build a standardized and scalable platform on top of these integrated offerings. To ensure we continue our leadership, we also invest at the highest level in the industry. We're investing about 6% of our revenue back. We have already over 40 products released and a robust pipeline of new developments. Within the overall portfolio of 40 products, it's worth pointing out some key benefits. We can enable food processors to manage their factory by linking the equipment to the overall process, and it functions as a single entity. This is built on the strong industry knowledge that Marel has in the overall food process. The system that centralizes data and historical trends to analyze the full production of the customer. The system also offers end-to-end traceability throughout the process, and it serves as a central control for the whole manufacturing process. This is an industry-leading solution that's already installed in over 2,500 manufacturing sites around the world, ranging from small producers to some of the largest food processors in the world. Now, let's look at a brief video of the Innova system. The food processing industry faces daily pressure to do everything with greater speed and accuracy. Most food processors are facing tough competitive challenges, and these require smart and informed responses. Important decisions have to be made quickly, and to make the right decisions, you need to have the right time. Marel's Innova food processing software gives you data-driven insights in real time, whether it's from your equipment or integrated IT systems. You can make smart decisions at a moment's notice, solve problems before they happen, and make everything count. Processors can control single devices or a full range of equipment across the plant floor, from purchase orders to sales orders, so processors produce only what is needed. Traceability is at the forefront of food safety. There's an increased demand for traceability from consumers, restaurants, and retailers when it comes to food origin. Innova meets this increased demand by ensuring full traceability throughout the process. There's an increase of government regulations for digitization. Many of the largest food processing companies in poultry, fish, and meat industries use Innova, which has now been installed in more than 2,500 plants worldwide. An experienced partner and proven production control software is a must for your digital transformation journey. It is vital to make the most out of your raw material, resources, and equipment performance. Optimize your production with the perfect toolbox of Innova's food processing software and Marel's process know-how. What customers are already saying about our solutions today across our industries, fish, meat, and poultry. Our customers are stating that we've been able to solve all their business challenges around traceability, present data to make quicker business decisions, and they can meet customer orders faster and ensure compliance with regulatory requirements. Our success will come from continued investment and our broad offerings that serve as a platform for transformative food processing solutions. Now that I've covered a bit of our history and current offerings, I'd like to transition over to where are we going. We're going to a new level of integration from the machine to the enterprise for food processing management. We'll be providing data-driven insights that will benefit the customers to maximize their value creation. We're moving to a new architecture for digital solutions. We're making this change not for the sake of the technology, but to deliver more value to our customers. We're developing a solution that can maybe best be described as a hybrid cloud solution, which combines the best of on-premise and the cloud technologies. The solution uses on-premise technology to enable control and factory uptime regardless of the internet connection, while also combining it with the benefits of the cloud, like data analytics. On top of that, industry-leading IoT solutions which have the latest security standards. The solution is designed based on our customer needs, but we're also including capabilities to allow Marel to continue a healthy profit margin throughout future growth. This will both enable seamless integration of our current offerings and facilitate integrations of future acquisitions. We've stated that about a half of our growth will come through acquisitions, so it needs to be quite easy for future members of the family to plug into the platform, so we can have a single overview and control of the manufacturing process, regardless if it's an acquisition or something that we have today. While the platform is a key enabler in delivering on our plans, it's not intended to be a customer offering. It's a building block. It's a building block that creates value. I mentioned that we now have over 40 software products, and our digital innovation grows by the year, so the list continues to get longer. This calls for simplification of our product offerings, and we have determined, based on our customer interviews, that we should create 5 product families which represent distinct sources of value. First is logistics. These are solutions for inventory, material flow, and labeling, just to name a few. We have planning and optimization. Here we have solutions to manage the production schedule, such as order fulfillment. Within this product family, we're also investing in a demand-driven optimization solution for raw material, which has the potential to be transformative for the industry as we can control the equipment automatically based on the optimized production plan. We have food safety management. Here we have quality assurance, regulatory compliance, and traceability of the production. There's performance management, for example, solutions that help with yield and throughput. Finally, there's production control, which seamlessly connects multiple machines together to work as a single entity. These five sources of value will be available to a different degree on the machine, on a line, or for the full factory. Here we're showing how we'll be discussing our software offerings in the future. It's also worth mentioning that we'll be transitioning some of the offerings towards subscription-based business models. Let's take an example of the different levels from the machine to the factory. For example, performance management. That can be offered on a machine level. It'll bring great value by providing actionable insights for improving the output of that machine. A line level would combine the data from multiple machines to generate insights above what could be seen from each machine individually. And finally, the factory offering will take all the data from the machines and the lines and combine that with the production plan to give the richest insights into the whole business for better planning and decision-making. Last but not least, the machine connectivity will help us and our customers meet and exceed our ESG goals. I want to take a moment to discuss environmental, social, and governance goals and how that links to our digital journey. By connecting our machines and including the right sensors, we aim to provide a full audit trail to allow our customers to monitor the CO2 footprint, reduce food waste, and expand traceability from the source to shelf. I want to give two examples of products that fit within the five values that I mentioned earlier. The first solution I'd like to talk about is order fulfillment solution. This product gives the customer real-time insight into expected versus actual output of raw material, and it's an order scheduling tool which highlights deadlines, surplus products, and orders at risk. This solution will evolve into supporting demand-driven production, and we're launching the first version next year. The next solution is IMPAQT. That can show the customer why a line is not performing, so a customer can act on it. For example, improve hanging performance, correct container loading, and this solution has both real-time and historical analysis of performance drops to allow for earlier interventions. We already have nine systems installed and several pending installations. What better than to show you a brief video that demonstrates the system in action? I would say that currently we are in the digital revolution in primary processing, where the digitization really helps us to bring us to the next level, where it enables us to be less labor dependent in the plant. IMPAQT brings information streams together that provides you a real-time insight in how your line is running, the performance of it, and where you can understand how you can improve your process. You have real indicators of what you need to do to make sure your line performs at its optimum level. I would see IMPAQT as a service package. IMPAQT is, of course, running upon software that generates the data, but that is not what brings the product. That only brings the insight. The product is that you have the dashboards that give you the insight to take your decisions and that help you to either do the service or maintenance with your own people or where you can request for help from Marel to help you take the next steps. At a much earlier stage than that you've been used to today. That is both for the customer where the fault finding is much quicker, it's much more predictive, so they know when and where to take action. At the same time, that really means that our people from Marel have to travel less, can do much more remote support because it's less of a downtime or major urgency that is going on due to which we have to send specialists. We can really take the customer by the hand in the earlier steps of support. The transition from current system, which is installed in over 2,500 sites, over to a fully connected hybrid technology, will happen over time. In phase one, which is now until next year, most functionality is still on-site except for the proactive maintenance that I mentioned, which we're already rolling out. Phase two, which is from 2023 until 2026, at that point, we're shifting some of the functionality from on-premise to the cloud where it makes sense, making operations easier, standardized, and scalable. Phase three is where we have fully transitioned to hybrid cloud, where it has been deployed as the primary infrastructure with solutions built on top of that, such as the demand-driven planning and optimization. Now, I'd like to hand it over to Anna to discuss in more detail how we'll get there. Hello, my name is Anna Kristín Pálsdóttir, and I lead innovation at Marel, and I'm a member of the executive team. I have been working at Marel for six years now, always within innovation. In innovation, we have passion for automation, sustainability, and of course digitalization, and working in partnership with our customers. We have a clear vision of being the digital partner of choice, and we have a strong foundation in both our advanced product offering and in our overarching processing software. Now it's time to take the next steps in Marel's evolution to transform the way food is processed, and we do that with connectivity. We need connection to happen to enable so many things that are important, even critical in our lives. Connect with people, connect our devices, and connect to different companies and parties to do banking, to buy things or get information or knowledge. Connectivity is also the cornerstone of Marel's digital journey. We need to connect the solutions out in the field, in the processing plants of our customers. We need connectivity from machines to value chains level so we can collect data at scale and start together with our customers to create more value than ever before. You might ask yourself, "Why do the customers need this connectivity? Because we can use the data to get better insights into the customer's production processing. We can make better decision, and we can improve machine performance. Not only that, but additionally, we can provide better aftercare of the solutions at our customers with data-driven insights. Data about critical components are collected and translated into valuable information on performance. Now, we and the customer can act faster and with more accuracy when service is needed. Let's hear how our customers have experienced these benefits in their own production. I think this is a great example of how we in Marel are together with our customers, transforming the way food is processed. We also see how easy it is to get connected, meaning that we have a scalable solution available to current and new customers everywhere in the world. The digital engine is a new concept that we're introducing into our products. It is implemented by adding a new computer to every machine, every line, every solution that we deliver to our customers. We are there giving the customer more information and guiding them how to run the production optimally. We are also providing the customer with more historical data which they can use to look further back in time, spot trends, and use the information to optimize their production. When customer call us, we can spot problem faster by entering our dashboards and for monitoring the meters and the bars and all of the information that's there. We have the historical data and all of that. By this manner, we can see a normal status of the machine right away. With this dashboard, we can solve more problem remotely quite easily. If needed to send our service engineer on site, then we can prepare them with all needed spare parts, tools, and the know-how, what is the problem. This is an opportunity for us to move more into proactive service. Let's focus on the improved service offering that is enabled with connectivity. We at Marel are proud of our extensive service offering and closeness to our customers. In our digital journey, we are working constantly on enriching that offering and our availability. I will highlight three critical things. First, with connectivity, our customers are getting more insights into performance of critical parts by utilizing current and historical data on how they are working. This makes us take leaps forward to optimize performance and prevent unexpected and unplanned downtime to the processing line. Secondly, with connectivity, you get access to data that enables remote service offering. Our customers and technicians can together analyze and find the source of a challenge and service the solution without fly in, fly out. This provides our customers with more sustainable services and faster responses. The third and final point is about prediction and seeing into the future. We will pioneer more advanced maintenance solution, allowing customers to maximize factory uptime and performance and optimize all services and maintenance before it impacts performance of the processing line. As I stated already, connectivity is the cornerstone of our digital journey, and therefore, it matters a lot to connect as many solutions as possible and work with scale. We are approaching our customers in three ways to get connections going. First of all, we are visiting our installed base and connecting equipment that is already in processing. This has no IMPAQT on how the solution works in the processing line, but it can and it should improve future performance. Secondly, we are targeting new sales. That means that we upgrade equipment with connectivity, ready plug-and-play features. Last but not least, we will reach scale with connectivity with new developments. We are proud to invest 6% of our revenues into innovation every year. We target to have the digital engine as a standard feature from day one in these solutions, and the first programs are already in the pipeline. With releases happening soon from now, connectivity is an integrated feature. We are piloting connectivity with two major Marel solutions that are installed at multiple customers. SensorX is one of the pilots. SensorX is our advanced X-ray bone and hard contaminant detection systems. We are working with many of our customers in the U.S. to get connections happening. The second solution is the FleXicut, the water-jet cutting solution for the fish industry. There we focus on customers in Europe. We have set up an agile feedback loop to capture learnings from these efforts and incorporate them into our material, processes, and value propositions for connectivity going forward, and this we do in collaboration with our customers. Already today, we are experiencing the benefits of connectivity, and going forward, we expect that our holistic approach to delivering seamless solutions to customers will help them maximize performance, minimize downtime, and embrace a more balanced demand-driven food processing value chain. Let's look at our rollout timeline. Today, we focus on providing increased machine uptime and performance with real-life dashboards and insights on machines' health and production. We additionally reduce service response time and improve our remote service offering. In two-three years, we will have increased optimization of production decision. We have used the insights that the data provides us to maximize order fulfillment and improve sustainability of production. We have minimized recall risks and further improved our customers' access to green financing with traceability and sustainability at heart. In five years, we have maximized factory uptime and performance with predictive maintenance that prevents most unforeseen downtime. We will have reached our full potential in agility and flexibility with AI and using full value chain insights from farm to fork. Our customers will have the ability to optimize full processing footprint with the potential to benchmark across industries, regions, and production lines. Another exciting element in this journey is that many of the opportunities this shift will enable us are still undiscovered, and I look forward to discovering them in partnership with our customers. No journey is without a challenge, but having our strong foundation in providing software solutions to multiple poultry, meat, and fish customers worldwide, I want to highlight a few of these challenges that we are already actively managing, and we are engaging with our customers to address them. Cybersecurity is a critical topic in our industry, as everywhere else. Marel uses proven solutions in security towards customers, and we have certification that makes our connections robust and trustworthy. Ownership of data and how to use it is a critical topic. There we need clear data principles and clarify usage terms and conditions. We realize that we also have to work with third-party, both machines from other providers, and access needs to be made for those that need to use the platform. For these types of communication, we use and provide standard protocol interfaces and APIs. We have to remember that this is a change journey. This will not only change how we work, but more importantly, how our customers approach food processing. Marel has a track record of working closely with its industries of fish, meat, and poultry and partnership with its customers. We will build on that in this journey of transforming how food is processed. We have shown you that digital is at the heart of Marel achieving its targets, and it will also have a positive IMPAQT on our business model. Organic growth will be driven through stronger product offering and customer value proposition, and our digital platform and solutions will make us more attractive home for other businesses. With more digital solutions, we'll have higher recurring revenue through software, integrated offerings, and better attachment of service level agreements. Greater scalability will allow us to grow earnings per share faster than revenue and improve our return on invested capital. Most importantly, though, customer engagement will increase, and we will become a more indispensable partner for our customers. Great. Thank you all very much. With that, we have concluded the formal presentations of today, so let's move into Q&A. In addition to our three keynote speakers, our EVP of Poultry, Roger Claessens, is joining us live from the new Bell & Evans plant in the U.S. Bell & Evans is America's oldest branded chicken company and is the real U.S. pioneer in terms of organic chicken. Animal welfare and sustainability is high on their agenda, and their new $330 million plant was financed with the first green loan in U.S. poultry. The 100% air chill processing saves millions of gallons of water each year versus the traditional water chilling, and 41% of site water will be reused daily. Moving from one pioneer to another, while everyone is getting settled here on stage, let's go upside down and pay a visit to Hazeldene's in Australia. The company accounts for approximately 7% of Australian chicken market and supplies products to major supermarket chains, wholesalers, smaller retail outlets, and butchers. In his keynote, Árni Sigurðsson talked about how managing complexity arising from the exponential growth in end food products is becoming a relevant customer pain point. Well, Hazeldene's processes approximately 150,000 products per day, and the company's retail customers each have their own packs and standards. Retail is detail. Let's hear what Hazeldene's has to say on today's topic, digitalization. Smart and modern poultry companies need to be agile. We are in the fast-moving consumer goods protein space. Poultry is the protein that we produce, and we need to use our data and our systems and our key people to understand that we're running in a very quick and live environment. We have a big need to get our financial dashboard reporting to a world-class standard, and we've almost achieved that. From our live bird planning and our production planning side, our data that comes in from the farms in the field and gets put into our live production teams is critically important as well, and Hazeldene's and Marel are leading in that space. There's more focus from the retailers on having robust systems in place where we're able to identify all of our product through the supply chain, not just because the retailers are demanding it, that's certainly a big part of that, but because we understand that we, you know, we are a food producer, and it's our obligation to make sure that we are, you know, raising the bar all the time. It enables our warehouse and dispatch team to load trucks correctly without making mistakes. This includes loading the correct dates, putting the correct customer information onto pallets. With our future plans, we'll be going with a QC module and a recipe module once we go live with our new secondary processing plant. The QC module will enable us to take paper off the floor and give our QA team the ability to dashboard and report live to problems that are happening on the floor. In daily operations, Innova is the stable digital component in the plant on which everybody can rely. If an incoming flock varies in weight, if a machine shows a drop in performance, if a customer suddenly changes their order, or if a recipe needs to be changed, Innova gives real-time insight into how processes can be adjusted to solve the issue. Marel offers all the digital tools required to give you the resilience and speed to market you need to be competitive in the industry. Fantastic company, Hazeldene's, indeed. Retail is detail, and Marel has the solutions. Now time for Q&A. Everybody's ready here. Árni, Anna Kristin, and Hjalti, welcome. As a reminder to our audience, if you would like to ask a question, please click the link that should be on the bottom of your screen, or email ir@marel.com. We have the first question already here, and it is from Eric Wilmer of ABN AMRO, and it reads: How does your Innova software communicate with equipment from your competitors? For example, in case of a processing line, which also includes various processing modules manufactured by competitors. I think I'll direct that one to you, Hjalti, our VP of Software. Thank you. Thank you for the question. Our strategy is to provide end-to-end, full solutions. That is key. So far what we have been focusing on is the Marel equipment to ensure that we provide the best full-line solutions. Now, we do also have connections to third parties, and we look at that on a case-by-case basis. Okay. The second one from Eric Wilmer as well. Could you provide some color on the potential lock-in effects from software-as-a-service, both on the potential of you locking in customers with your software as well as your competitors doing so with their solution? Who would like to take this one? I'll maybe start. Sure. Yeah Others can chip in. I think, I mean, our focus is not really around creating a lock-in. This is really around the focus of creating value for the customer and then I think creating a win-win, then good things happen. What we're really focused on is to help end-to-end solution. I think our strength is really that we are the only player operating in poultry, meat, and fish across the three processing steps of primary, secondary, and further processing. We have this scale, we have the broadest offering, we have the largest installed base, and we have those line concepts. Kind of just focusing on that and marrying the software and digital solutions with our hardware to integrate that as a solution and provide that value to the customer. That's really our key focus, to kind of build that out and help the customers with their pain points that we were talking about, in the presentation. Maybe I can add to that because not only talking about competitors, but what we can do through just partnership and some other companies than Marel, because we are of course focusing on bringing new solutions to the market. There, for example, we are partnering up with companies on bringing something new to the market. TOMRA partnership is our newest example of bringing a new technology to the market. There we are also using our potential of partnership, not maybe competitors, to really give scale to the market and bring further solutions that are connected to the market. Opportunities as well as competition. Absolutely. Of course, we have Roger Claessens as well, online. I don't know, Roger, do you have anything to add? No, I think it was very well said. I think looking into competition and those environments, there are always added values and our customers are looking, let's say, to get insights in the process. It is not about the lock-in effect, it's about partnership and moving forward. I think that's what actually has been proven in the last period, that there the request is getting more and more, so we are at the right time, at the right moment with these kind of solutions. Thank you. The next question comes from Akash Gupta of JP Morgan, and it reads: Where are you in the process of selling Innova package as a software solutions where you get recurring revenues each year? I'll direct that one to Hjalti. We are in the early stages. We are currently selling as perpetual software, with a maintenance license every year that provides upgrades, and we will be transitioning to subscription. I believe in the introductions, we talked a little bit about the predictive maintenance, and those will have plus packages on top of that, which will be in a subscription model. Then we'll be transitioning over the next two years, our current offerings to a subscription as well. It is worth pointing out, though, there are certain offerings that we probably won't transition fully to subscription. Those are the ones that are critical to the manufacturing process so that we don't have a case that we are accidentally unplugging the factory when there's a non-payment. There are things that will be perpetual, ongoing, and then a subscription on top, and that will happen over the next two years. Maybe to add to that, like, we have a great foundation to build on there because, of course, we know that our cutting-edge software that we're offering to customers today is already having the largest installed base in the food industry. That's right. His follow-up question is: Can you talk about competition that you see in digital solutions? If a customer is not using Marel, then what are the other alternatives? Can you provide digital solutions to competitors' install base? I think I'll throw that one over to you, Arni Sigurdsson. Yeah, I mean, I think how we think about that is really that there are players that can offer elements of what we can do, but no one really has the breadth and the depth of the offering that we will have from basically factory level down to individual machines. Like I said earlier, kind of being, like, having that scale of being in all processing steps across multiple proteins, that allows us to kind of have a very good starting foundation. Also with to Anna's point, I mean, we started, when did we connect the first one? Was it 1994? Yeah. The first connection. Ninety-four. Yeah, exactly. I mean, we have that heritage. Basically, we want to build on that and marry that with the equipment and have that processing layer because the real advantage and the real value to the customer is when you can kind of capture the information. Mm-hmm automate decision-making across the process. You're basically using information early in the process to make decisions downstream and later, and then you want to capture the output and maybe tweak something early. That's really kind of where we are in pole position. Maybe, Hjalti, if you add a little bit of a flavor because there's always this discussion around ERP versus manufacturing execution system, so kind of that dynamic from a competition element. Yeah, I think what I would also look at is, what is our core strength? Yeah. Our core strength is the food processing industry, knowing the customer in food processing, and that is where we bring the value in the software and where we believe we have a competitive advantage. As Oddný mentioned, with that comes the ability that we can automatically change what the machine is doing based on the data. This is something that if you look at ERP systems or general software vendors, they don't have that capability. We're in a very unique position when it comes to that. We're in a strong position, but we're always monitoring what the competition is doing. Exactly. I maybe like to throw this one over to Roger as well, who is, of course, at the Bell & Evans site in the U.S., and, perhaps how big of a factor digital was in the decision to go with Marel. I think if you look to Bell & Evans, which is, as mentioned in the pre-introduction of Bell & Evans, the first one going into organic chicken, air chill is of course one of the key drivers. Having the data from the beginning of the process where they actually connect their systems from the hatchery already into the quality track and tracing going forward is one of the main pillars. Our innovation roadmap and our digital roadmap was one of the key enablers to secure this project. It's good to see how excited everyone is at this moment in order to be ready for startup. Everything is more or less ready to go. We have tested the systems where indeed the digital capabilities for us, not only to get it up and running quickly, but also to monitor the product performance and the process performance end to end has helped made the decisive step for us in securing this project. We look forward to the partnership with this customer going forward, which quality is, let's say, the main drive. Thank you. There is a follow-up question from Akash Gupta from JP Morgan. Are there any areas where you can do M&A on digitalization/software side, and in which geographies will they be, and what value will these targets bring onto the table? I'll direct that one to you, Arni Sigurdsson. Yeah. Basically, we're not really reliant on M&A, and it's not a separate pillar from our strategy. I mean, what we are really focused on is on our three key strategic pillars, which I talked about in the growth event. It's around customer focus, it's around best-in-class technologies, best-in-class products and technologies, and people and culture. The M&A is really around enhancing and accelerating that strategic execution. We can look at each one of those pillars. If you want to think about customer focus, we could look at a player where they have an interesting kind of customer base or an interesting distribution channel. If we look at people and culture, there might be an element where we think we need to accelerate our transformation in terms of talent and kind of on that digital journey. What we've historically mostly been focused on the M&A front is around certain technologies or products. There we really focus on kind of three different elements. We can do it organically, invest organically, and we have that commitment of investing 6% of revenue annually back into innovation. We're doing strategic partnerships, and we're doing that both kind of the TOMRA example, and we're also doing that on the softer side that Hjalti can maybe touch on later. We're doing acquisitions, and we're kind of constantly thinking about kind of these trade-offs and kinda how do we optimize on that front. That's really how we're thinking about it. As we shift our focus more towards digital and also software, then we'll also shift our M&A pipeline and the opportunities in that direction. Maybe, Hjalti, you talk a little bit about the partnership to just give one example how we're thinking about certain applications that we are filling in. Yes. If it's okay, I'd like to add a little bit on- Yeah, of course. On the M&A. The interesting thing with software is you can manufacture it as fast as you want, so it's scalability. That is a key thing that we'll also look at in M&As. Can that help us scale faster than the overall Marel growth that we have? That is a key thing. Just to add in terms of what kind of it needs to be helping us in that journey. As Arni said, we're not dependent on it to be successful. On the partnership side, we have announced a partnership with SafetyChain, a great partner in the U.S. They have quality control products, and we're connecting that with the Innova system. Together, we're providing a full solution on the manufacturing control, plus a quality control from SafetyChain. We're doing partnerships as well. Absolutely. Maybe just bringing it over to Anna Kristín, 'cause you talked about connectivity and then on the current installed base, and we of course recently acquired TREIF back in, was it last year. Maybe you could talk a little bit about how we're plugging that into our own digital platform. Yeah, definitely. Because there are great opportunities when we are getting more technology in, and this is a great example of a merger or an acquisition that is for sure going to enrich our product portfolio and what we can offer to customers. What we are focusing on, of course, is integration, this integration of hardware and software, and that we are providing modular standard building blocks into full lines. Of course then it's easy to install, easy to upgrade, easy to service, and that is what we aim when we are getting like a strong partner like TREIF into our product portfolio, that we can get the most out of it. Having these new products coming in and strengthening our line and that's what it is that we then offer to our customer later on. One area that I also have to touch upon, because TREIF is so known in the meat industry, red meat industry, here we even have a further possibility of cascading their technology into fish and into poultry. It's not only about strengthening the line concept that we have into meat and the meat industry, but also to take advantage of the technology further. Yes. Yeah, just I think we really need to highlight it that kind of in one of the videos that we showed with the digital engine, how we've actually designed that is, that when we integrate or acquire new companies and integrate them, it's relatively simple to onboard them onto our digital platform with that digital engine. Because we've always I've kind of, I feel like I'm always repeating it, but one of the X factors that we have when we are talking with family-owned businesses and other players around kind of why they should be joining Marel, it is one of the factors that really makes a difference is this digital platform. I think it's just worth highlighting. Yeah. Yeah that this is kind of a key design factor when we were thinking about how to do this. Exactly. This is where we have been stepping up our investments since 2018. Yeah. Really making sure that it is this easiness of joining our platforms. Yeah. Yeah. It, of course, is, we talk about our X factors being global reach and digitalization, which aptly named two events in the Capital Markets Day series. Next question comes from Andre Mulder from Kepler, and it reads: You said that Innova is installed at over 2,500 plants. What is the total number of plants worldwide, and how has this developed over time? Also comparing to your own installed base in terms of digitalization, where are you versus your competitors? I'll throw that one over to you, Hjalti. The 2,500 plants, yes. We actually talk about sites, because some of these plants are vessels that have the Innova installed, and there are 2,500 installations. There are, of course, tens of thousands of sites in the world. We're looking at, for now, the Marel total addressable market. We wanna make sure that we have the digital solutions in the Marel accounts, and then we grow from there in the future. I would say the upside is unlimited, and that is why we are building the software so it can scale faster than the hardware, so that when we have a solid foundation in the digital coverage in the Marel offerings, then we can really take off in the whole market. Okay. Roger, anything to add? 'Cause you of course know some of these sites very well firsthand. Yeah. I think what we're aiming for is, of course, to get a customer who is worry-free, who is able to run his production from the beginning to the end, and more or less with the data helping him to get information to make better decisions. Indeed, if you look at the number of plants, that is almost endless, depending on which industry you are. If you look at the ramp up, here we see that, of course you have the early adopters where they see this need. What we see is that once they have tasted it, more or less, then there's appetite for more. Therefore, the framework that we just talked about in the previous questions is that important because the framework enables us to get quicker applications, to do quicker iterations also on upgrades and packages, which could be on server side, innovation side. At least all are supporting our customers to optimize their processes in any way possible because the processes get more and more complex. It is 2,500 now, but it will ramp up really, really quick going forward. Thank you. The next one is from Lawrence DeMaria from William Blair, and it reads: Do you expect to be the entire system integrator? And is this a winner take it all, where the software solution provider captures the most value and can commoditize the other equipment on the line? And I think I'll throw that one over to you, Árni. Yeah. I mean, like I said, I mean, what we are really focused on is kind of two things, and I can kind of elaborate a little bit on that. I mean, first of all, we're, like Anna was talking about kind of earlier in the, in her note, it is around kind of connecting the installed base and making sure that the equipment that leaves the factory is connected. So that's kind of first thing, and that's how we kind of get scale. That's how we penetrate in terms of having multiple devices connected. What we're also doing, which is a more kind of targeted B2B approach, is with more sophisticated solutions, then we're taking a bit more time to test it with the kind of customers that we partner with, get the learnings, kind of iterate quite fast in the agile approach, and then kind of penetrating that selectively based on customer profiles. That's really what we're focusing on. I think we're in a really good position due to our line offering, due to the breadth, so we can kind of deliver on that, and that's really the focus. Yes, I think there are network effects here, with kind of. We're creating a high-touch model. We are engaging more often with the customer. We're doing more remote. We're able to do upgrades remotely, so kind of driving that engagement and also capturing a greater share of the aftermarket spares and service, and kind of understanding the customer better that we can feed into the innovation and so on. There is a network effect here. Yep. We want to just be really focused on delivering value to the customer, helping them with their process to, I really like Roger's point, kind of a worry-free process. That's what we're really focused on and that's how I think we will kind of be a winner in the market. Thank you. The second one, follow-up question from Lawrence De Maria from William Blair. Do you expect more competition from packaging companies, third parties or other OEMs, and who is best positioned to win? Again, maybe Árni you start off and then Hjalti, you top off. I mean, I think we will see competition from various angles. I think, like I mentioned earlier, I think some companies are able to have a specific component or a specific element, such as the packaging. But I think kind of having that ability to be able to kind of control and monitor and capture information across the whole process and being that kind of partner with the customer rather than just a single application supplier or maybe two or three, but really have the process, that's really gonna define kind of, I think, who will be in a leading role. I think the real advantage that we have is the process know-how. I mean, just cannot emphasize that enough. Understanding that process is what the customer really wants. That's why they want to partner with somebody that kind of they've worked with before that understand that process, and we kinda highlighted that based on interviews that that's the top reason kind of who they pick to work with on that digital journey. I think that's really kinda how we think about it. I think you can potentially have certain applications or products from different players, even third party, to kind of touch on that as well. Like I said, I think the players in the pole position are that have that strong position that we have. I think just to build on that, it also relates to the network effects. It is where we have the data to a degree that we can learn more and we can therefore deliver more value to the customer than others can. In terms of where do I think the strongest competition is, it is not from the European manufacturers that are in the back office. We look at some of the machines here in the studio, they don't have that knowledge, as Árni mentioned. They don't have the process knowledge that is needed to make the decisions from the data. Yes, there is competition from other equipment makers. However, we are investing at the highest level, and we're investing the most in the industry in digital. I'm very confident that, I'm not gonna use the term winner takes all, but we'll be in a strong position to deliver great value. Okay. A second one from Andre Mulder of Kepler. Regarding the privacy issue, how are clients reacting to you wanting to look over their shoulder to see how their machines are performing? I would actually love to hear Roger's view on that one as he is in great dialogue with our customers. Yeah. Thank you, Tinna. What it is that our customers are actually in order to get the added value of the data and the data sharing, it is of course that you work in partnership. Maybe first reflecting a little bit on the previous question on what it is about on having line control and having knowledge, just imagine, let's say, a poultry processing plant handling 15,000 birds per hour, meaning four birds per second, and then you're looking at a specific machine, and the machine potentially could work a bit better or is not getting the quality of what is needed. If you have to train someone to look at that machine and say, "Okay, is it a 24 unit machine? Which unit potentially is not functioning?" It is almost. You know, you need the digital engine, you need the data points in order to find where it is in order to overcome that issue as soon as possible. Then at that moment, data sharing is the key element in order to have the partnership that we are looking for. Having the right touch points opens the door on having, creating added value and creating the partnership with our customers, opening the doors in order to say, "Okay, you know, this is how we would like to work together in order to optimize the processes that is there." Finding the right spots makes it easier to have the conversation with our customers and makes that at this moment, we don't face any issues on that matter. If I could. Maybe something you can add to it. Yeah. Just one point there. It's important to note that we do distinguish between equipment data and production data. The customer data is the ownership of the customer. What we get there is anonymous in aggregate. Yes, it helps us to understand what is happening in the market so we can innovate, deliver better value to the customer. We look at the machines on an individual level, so the pushback so far has not been much because we say the customer data is the ownership of the customer. That's clear. The next question is sort of on the same theme, and it's from Sveinn Thorarinsson from Landsbankinn here in Iceland. Are there any intellectual property rights connected to Innova or any other digital products like copyright, trademark, or software patents? Or is this difficult to achieve and maybe not of high importance? Again, Hjalti, I think that one's for you. We have a list of patents, yes, copyrights, trademarks. We have not disclosed the number of patents that we have related to Innova, and I think it would probably, Anna, be hard to distinguish because some of them are integrated technology that is the great value that we can deliver with software and equipment together. Some of our patents, they rely on the combination. We have a good list of patents. Yes, for sure. Here it comes back to the integration part that you are talking about. Yeah ... like that we are trademarking or applying for patent for the full solution and what it does from beginning to the end. Yes, multiple solutions that have IPs in our portfolio. Okay. Perfect. The next one is from Fraser Donlon of Berenberg, and it reads, "Could you give a recap on the acquisitions you have made on the software side, such as Worximity, how they have helped us to evolve the value proposition?" Over to you, Arni Sigurdsson. Maybe I start and then, Hjalti, you step in as well. For example, on Worximity, we did that acquisition, or we actually did an investment in Worximity, 25% stake a couple of years ago, which was really focused on seeing kind of. We signed a partnership at the same time. The Worximity solution is really a, let's say, lower, let's say, not as sophisticated as what we have in Innova. But it's also easier to install, easier to upgrade, so you can get more scalability with that solution. We were really kind of just signaling that it was a strong partnership with our investment, and we were looking at whether there was an opportunity to kinda cooperate there. That was really kind of one of the steps that we're thinking about to kind of educate us about the market, learn more about kind of how pure software players are also thinking about the space, and we've learned a great deal, and we continue to be in partnership with them, especially in the North America region. Kind of great story there. Maybe, Hjalti, you also add a little bit of flavor on that then, and also on Cedar Creek. Yeah, well, of course, Cedar Creek, great acquisition, very specific related to the meat industry in Australia that we did. In terms of acquisitions in general, and this is more my personal view, that I feel the multiples are pretty high in the market right now, which is of course great given the amount of IP that we are developing at Marel in terms of multiples. But it makes the market somewhat hot. So we're looking at the list that we have is very targeted, so we get the right value into being complementary. As the example with Cedar Creek, targeted solution for a certain market. Right. I have a few questions from email that center around the sustainability feature of these new digital products. Kris, you mentioned that this digital journey will IMPAQT sustainability. How do you foresee specific sustainability products going forward? Anna Kristín, I think there's one for you. Yep. Great to get this question because we really cannot be talking about digitalization without talking about sustainability. If we look at just the foundation of this company, what we do, we are all about reducing waste, increasing yield and increasing efficiency. What we are doing next to that or to take the next leap in that area is with the digitalization. There we're actually giving our customers insights into their operations so that they can use the data there. They can go and see what it is that they are doing in terms of usage of water, usage of resources or usage of energy or any type in that area. They can really take action, see where they are today and what it is that they have to do to reach their goal in sustainability. Like we see ourselves in Marel, we have an ambitious goal of in 2040 to be carbon neutral, and we see many of our customers and many in our industry having the same type of a goal. To get there, you have to know where you are today, and you have to know what steps it is that you have to take, so that you can reach the goal later on. One other thing that I have to mention, and that is the green financings that we also talked about in the keynotes. There are great opportunities for our customers to achieve and go into green financing and green bonding with using our digital solutions because then they know what it is that they are doing, what resources that they are using, and they can prove it that they are sustainable in what they do and get access to those financing. Absolutely. We'll of course go deeper into that in next week's event and give you some fantastic examples of what Marel is doing in that area. Right. To the next question. Hjalti, I think this one is for you. How are these new digital offerings that we talk about different from what we are selling our customers today? I would say there is the connectivity. That is the key thing. What does connectivity mean? Because it's a technology. It is the ability to look at the data, look at the production information from anywhere, and the ability to compare it to factories, to control multiple factories. That is what the new offerings will bring. In terms of the core functionality of being the manufacturing execution system for the factory is pretty similar. However, when we transition to the new technology, it will be much simpler to set up and you will have the ability to connect, get data, and make better decisions in aggregate. Okay, that's clear. Maybe this one over to Roger, and to Anna Kristín. You've obviously started to roll out the FleXicut and the SensorX and getting the feedback loops. How receptive are customers to your digital offerings? Maybe if you start, Anna, and then Roger can... We have been very much excited about bringing these two core solutions in our portfolio to customers and getting the first feedback in. We also chose these two solutions that you mentioned, the SensorX and the FleXicut, because they have such a diverse customer base, meaning that we get so much learning into our company. We are getting different types of customers that are located in different regions and telling us how they can use this product, what the learnings we can take into the innovation processes, and so on and so forth. Definitely selecting this one and the first feedback that we have been getting in has been really, really good. We are seeing the main benefits coming through already, both that we can go more into proactive services and proactive and predictable services. Sorry, the P words are confusing me a little bit. That means that of course, we are taking just new leaps into being the service partner of choice to our customers. We are going away from being reactive and preventive into something that the future product offering is going to allow us to do, which is to be like the true service partner of choice and also that we have shorter response time. As Hjalti was telling earlier on, no fly in, fly out, but we service our customer remotely. Similar to that, we are also enabling the insight into the operation, into the production, so that the customer can really play the mix game, change between products and SKUs throughout the day, not wait until end of the shift, but actually giving them this opportunity to, yeah, really be agile and flexible as the market is demanding from us. Absolutely. I recall Roger saying that preventative was like the big buzzword 10 years ago, and now it's like the industry standard and part of every package, and now it's more moving into predictive. Any great examples to that end, Roger? To add to Anna's word, it was perfectly, but I think it's about disclosing the data into information and helping with that information, our customers to make the right actions. I think it's about moving that, let's say, at least making the right action just before more or less something goes wrong or that, you know, that you're really in time. The good thing about the data is that the data is, let's say, facts, and facts makes it easier to have a good dialogue with our customers and to do the corrective actions. Their digital journey is helping us really a lot, and actually that makes that our customers get appetite for more. Because what you see with those great initiatives that we have and we have more in the pipeline, as we said, that actually they cannot wait to get even more. Because, you know, you have the data, why could we not go even further? I think that's the really exciting part, where we come closer and closer together with our customers, going into the future, moving away from preventive or, let's say, from predictive to preventive into a condition-based monitoring and condition-based service items going forward. Really exciting times going forward on this. Mm-hmm. Maybe just to emphasize what Roger was saying, this is for sure creating appetite for more. That is one of the major feedback that we are getting in. When people get these insights and get this opportunity with service offering and production insight, it's only asking for more. Great. Truly exciting times ahead. On this positive note, I think we'll conclude today's Q&A. On behalf of the Marel team, thank you to our panelists and of course Roger from across the pond. We have of course our final 360 event on sustainability coming up on December ninth, led by our CEO, Arni Oddur Thordarson, and Director of Sustainability, Þorsteinn Kári Jónsson. I'm confident it will be an interesting event. On behalf of the team, thank you to our audience for your time and attention. Stay safe and see you next Thursday.