Good afternoon, everyone, and welcome to SECO's full year results and business update presentation. Before I hand over to your host today, may I please remind you that if you would like to ask a question, please use the Raise Hand function on your screen. For those dialing in, please use star nine on your keypad. I now have pleasure handing over to your host today, Marco Parisi, Head of Investor Relations. Please go ahead, Marco. Thank you very much, Catherine. Good morning to everyone. I'm Marco Parisi from SECO. Together with me today, Massimo Mauri, CEO, and Lorenzo Mazzini, CFO. I will hand immediately the speech to Mass for the presentation. Please go ahead, Mass. Hi, Marco. Thank you very much. Basically, 2021 was a very busy year. We acted also in a very difficult environment because the shortage of the components and the COVID. Well, I should say that, nevertheless, such problems we posted a very good end-of-year result, making also a lot of things during the year. In fact, we launched CLEA. We went public, successfully completing the IPO in May. We did two acquisitions, very important. One was ORO Networks, now SECO Mind US, to accelerate the CLEA strategy on AI. The other one was Garz & Fricke in Germany, which is now SECO Northern Europe. The full-year results are something that is very significant in my mind. We posted EUR 160 million in revenue with 46% increase in 2020. Of which, above 28% organic growth and EUR 25.3 million in adjusted EBITDA, which increased by 60% versus the previous year. The weight is 23% on the total revenue. I think also it's important to mention that [audio distortion] Massimo, can you hear us? As I said, yes, I can hear you. Apologies. I was just checking. I think you may have dropped out for just one moment, so thank you. Please continue. Okay, sorry. So, as I said, the results are impressive in my mind, especially the Q1, where we are accelerating a lot, the growth path over the year. Actually, we accelerated already into the entire second half of 2021, and we are continuing to accelerate our growth path also in 2022. These results are above the guidance and the peers' growth path. Well, I should say that we did a guidance in the beginning of 2020 and 2021 when we went public. Well, we revised it 2x, increasing it two times during the year. In the end of the story, we beat it finally. It's really a great result. Despite the condition on the shortage and the increase in the price of the material, we was able to maintain our level of gross profit margin, basically due to two things. One was the fact that we did a 2x price increase versus customers, which was well accepted from most of our customer base. Another one was, of course, the increase in the revenue of our SaaS business, which is the CLEA business, that is producing a better incidence in terms of gross profit margin, which is around 80%, providing us a higher margin contribution. In fact, CLEA grew in the last quarter at EUR 2.2 million, which implies a growth of over 60% versus the previous quarter. On a pro forma basis, meaning including the result in the software that ORO Networks did in the first half, which are not included in our P&L. We already post, roughly speaking, [audio distortion] million in revenue, which is a good starting point for 2022. As I said, we completed and integrated two M&A, and we will see later on how the Garz & Fricke acquisition and integration is growing. Well, coming to the [audio distortion] the visibility is increasing, not only in 2022 but also in 2023. We have a very robust and significant organic growth. I confirm the official guidance for the first quarter, which is in the range of EUR 41 million-EUR 42 million in revenue, which means 53%–58% in organic growth, and overall 110%–115% in the result increasing. In a like- for- like, something in the range already of 40%, meaning including the Garz & Fricke result also in 2021. This visibility increasing is also confirmed by the order backlog. The order backlog is growing. It's continuing to grow together with the order intake, together with the pipeline. We have a pipeline well above EUR 300 million now with a lot of new customers and the existing customers as well. Well, the order backlog is EUR 157 million at the end of February, which is 2x higher versus the previous one in February. It was sixty-something, 69, 65, 68 or something like that. Already including all the in the perimeter, all the acquisition that we did in 2021. Another important good news is for sure the CLEA. CLEA was a very nice product when we launched it in 2021. Well, now is definitely a successful product. We have a lot of positive feedback from the customers that are using them. Also now we have a very impressive pipeline with over 500,000 devices under negotiation, which above 200,000 devices very close to be put into contract. We also signed an important industrial partnership with Exein. Exein is a startup with operations in Italy and in the U.S. as well on the cybersecurity. This startup is backed by among others the private equity of Porsche. They have a very cool technology that we will include in all our product hardware and software part accelerating the SaaS model on our business model. We will be in a position to sell and to offer Exein solution starting from the second half of the year. We expect it will provide additional growth in revenue and EBITDA margin in the future. Well, I think maybe Lorenzo you want to continue and to dive us into a wealth of details numbers. Yes. Thank you, Mass. For what concerns our financial highlights, we can see here total revenues. Total revenues recorded data of EUR 116.3 million in 2021, with a strong growth of +46% with respect to the same data of the previous year, so year-on-year. The total number in 2020 was EUR 79.5 million. A point that has to be underlined in this part is for sure a strong acceleration of sales that we had, in particular, in all the H2 of 2021. We grew more than 50% in all, both the quarter Q3 and Q4, but in particular in Q4 the acceleration has been really important with a growth of 113%. Another point that has to be underlined for sure is our revenue from software. Even the revenue from software had a type of increase and the fact of increase really important during the year. For sure, obviously this growth is due to the fact that we launched our new application, our new platform, just in the beginning of the year. What is really significant for us is the fact that in the last quarter of the year, CLEA generating revenue of EUR 2.2 million in just a quarter. That, as you may understand, is a really material and significant amount of revenue on a quarterly basis that for sure will increase in the next quarter of 2021. Good distribution and good diversification of our sales across our geographic area. As you know before, this is a key feature. Let's say our business and our revenues. Coming from a lower level of our P&L, commenting our performance in terms of gross margin. Gross margin increased on a year-on-year basis, 48%. We recorded a level of EUR 53.1 million in 2021 versus EUR 36 million in 2020. In relative terms, our gross margin has been stable in 2021 with respect to 2020. For us, this is a really strong performance and resiliency of our business, because as you know, in particular Q2 of the year, but increasing a lot in Q3 and Q4, the component shortage situation of electronic components impacted a lot of the cost, and giving an important inflation rate on our components. What we have been able to do that was not easy, but we succeeded in this operation, where we passed on a big part of our increasing cost components to our customer, taking, let's say, a real fair and transparent strategy. Showing them where the market goes, and so applying an important increase, firstly one in Q2, sorry, and secondly one at the beginning of Q4. This allowed us to maintain our gross margin level. Another point that for sure give us an important results in term of profitability has been, as you know, the increase of software revenues that has an above average profitability in terms of gross margin. Going to the bottom line of our P&L, so talking about adjusted EBITDA. EBITDA grew a lot in the year, 59%. We recorded a level that for us is really exceptional and really great for this year that has been EUR 25.3 million in 2021 versus EUR 15.9 million in 2020. What is more important for us is that in so difficult a year in terms of, let's say, COVID waves, that as you know, even if this year COVID was a little bit less with respect to 2020, however, the COVID impacted many countries in an alternating way. Moreover than this, the chip shortage situation, given these two factors, exploiting operating leverage, we have been able to increase our EBITDA margin from 21% to 23%. Important growth in profitability. On bottom line level, for what concerns adjusted net income, it grows by 47%. We had results of EUR 11.5 million in 2021 with respect to something slightly below EUR 8 million in 2020. Thank you, Mass. For what concern this slide, I go a little bit deep on our total revenue performance, in particular in terms of geography and both, and then in terms of end market. A point that I would like to stress that has been really important for us is that due to the difficult shortage situation, we closed the year with EUR 160 million of total revenues, but we can do and we could do more. Actually, we closed the year with EUR 4 million of overdue backlog. Consider that this is for sure an extraordinary level for us, because if you consider the level of overdue backlog in 2020, this figure for us was not material. It was below EUR 0.5 million. In a normal condition, we could do a growth that was even higher than the important growth that we recorded. Going to the revenue by geographic area. As you can see, our most important geographic area increased really well. EMEA increased by 61%. APAC increased 92%. I would like to spend a couple of words regarding APAC, in particular regarding Fannal, that as you know, is our company in China that produce advanced touchscreen display technology. Consider that the company grew at 50.2% year-on-year, and based on this, 37% of intercompany sales. Selling our touchscreen technology across all the client, all the offer of SECO. With a great integration performance of this technology in SECO product. More than this, Fannal recorded a really interesting sales of these touchscreen displays among third-party customers, and the growth of Fannal on this, let's say, business line was at about 71%. Going to the revenue and the sales by end market, we see clearly that some end markets really grew a lot. In particular, fitness 27%, vending and distribution about 130%, transportation 34% and the industrial area that includes many industrial companies grew at 100%. What have been the key driver of this growth? The first of these, Mass said before, is for sure an increase in penetration of SECO products in the offer of our many of our key clients. I give you some example of these, let's say, names that doubled. They say almost double the sales in one year. An example is Sistemi Cuneo Group, or another example is ANNAX, that is a really strong transportation producer. More than these, there are a lot of new names in terms of new customer that finish their R&D development part and starting generating revenues in this revenue breakdown. One of these, for example, is Datalogger. Another one is Airteam, that is a really strong industrial producer, Danish industrial producer. Thank you, Mass. Well, going on EBITDA evolution, as I said before, we closed the year at EUR 25.3 million, +60% almost versus 2021. More important for us, EBITDA margin 23%. We have an improvement of 160 basis points in EBITDA margin versus 2020. How do we achieve this operating leverage? Actually, as you have seen, our gross margin has been stable. We could do a little bit better if we do that. We didn't have the shortage. However, I think that this great performance in gross margin under a shortage environment situation and increasing the EBITDA by two percentage points shows the resiliency of our P&L in difficult market condition. In particular, let's say, the expected growth of profitability under normal condition, exploiting the operating leverage that, let's say, this year generated two points in increase in EBITDA margin and stable gross margin. Thank you, Mass. Just the last couple of words regarding our net debt position. We closed a net debt position at EUR 97.5 million, obviously an increase with respect to 2020. Why this? This is mainly due to one important acquisition realized in the year. This has been the acquisition of Garz & Fricke with a cash consideration of about EUR 100 million. That has been financed through a dedicated acquisition financing. Moreover, as you remember, we acquired another company, that is ORO Networks, in June 2021, obviously with a less important investment. A point that I would like to stress in an important way in this slide, however, is our cash flow from operation. Cash flow from operation increased by 33%, 2021 respect to 2020. This is despite an important investment that we have done in working capital, because consider that in the respective year 2020, we invested EUR 15 million in working capital. Why is this? This is due to the shortage situation, because we were obliged to bring materials and components a lot in advance with respect to normal condition in our inventory to assure deliveries, to assure continuity of production. Despite this increasing working capital and this investment that we made, we have been able to increase our operating cash flow generation. Thank you, Mass. I leave the speech to you again. Thank you very much, Lorenzo. Just to be precise, I think the total cash consideration of Garz & Fricke acquisition was EUR 160 million, as per a total consideration in the acquisition, about 180. Thank you very much, Lorenzo, anyway. Let's now discuss about the future. To understand the future, we need to understand where the company is going. Well, if we look at the last quarter of the year, we can look at a very superior organic growth. We did EUR 45 million in revenue, and this is important to note the level of EBITDA. The level of EBITDA was above EUR 11 million and over 90% versus the same quarter of the previous year, and around 25%, close to 25% of the revenue already. This is important because it shows which is the level, the operating leverage that you can see in the near future, looking at the growth that is at the heart of the SECO story. This is the growth, and this growth is very strong, as you can see from the order backlog. I think that is definitely impressive. We are growing in a very spectacular way, thanks to a growth in existing customers. We are adding product and a lot of new customers that are coming and starting, as Lorenzo mentioned before, finishing the design win phase and entering into mass production. We will see also progressively during the 2022– 2023, many new customers starting generating additional revenue in a very long-term way. It means that we can expect to have a superior organic growth in the 2022 and ahead. Looking at how the backlog is growing by region, well, it's basically growing everywhere. We are looking at another acceleration coming from Fannal, which is the best performer of the group. We are also noting an acceleration into SECO Northern Europe due to the contribution of the SECO Group to the ex Garz & Fricke business, and also in a very nice acceleration in the U.S., where we are getting a lot of traction in acquiring new customers. Based on this order backlog, we have here the guidance for the first quarter, where we think to be able to grow at the range of 53–58 and EUR 41 million–EUR 42 million in revenue. I think we can do something better here. Let's see what happens. We still have, roughly speaking, nine to 10 days of work to deliver it. We are rushing. Anyway, as you know, the first quarter is the quarter where SECO [audio distortion] Massimo, I think we may have lost you. Can you hear us, Massimo? I think he's logged out. Is doing for the entire year. Sorry? I'm sorry, Massimo, we just lost you for the last two minutes. Really? Yeah. I'm sorry. I didn't know if you wanted to just go over the last couple of sentences for everyone's benefit. All right. Thank you. I'm so sorry. I don't know why the connection is so weird. Anyway, I think that is important to repeat that EUR 41 million– EUR 42 million is the first quarter above 40% of the revenue of the previous year. Well, if I look the entire year, we will see thanks to a strong organic growth and a strong backlog and a very important 2020 and 2022. We will release a guidance very soon in middle of April, but our expectations are increasing every month. Well, let's talk now about what we are doing in SECO Northern Europe, which was Garz & Fricke. Well, we are accelerating basically our growth path. We are ahead of our integration plan already. It will be fully completed by the end of 2022, when we will go live on SAP. We already achieved a lot of things that we looked at in the due diligence, and actually the company is performing better than our expectations and better against the business plan that we did during the acquisition process. Also, I would like to stress that we already got around EUR 2 million of cost synergies, and you will see them during the 2022 results. We will got the rest, because we are already working on them, which are relating mainly on purchasing costs and mainly due to the integration between SECO Northern Europe and Fannal, where Fannal will provide to them touch display panel. We are also launching the payment system solution, which is KarL4. We plan to launch it in the third quarter of this year, globally. We are finishing all the certification. This is again another product that will provide revenue in a SaaS mode, so recurrent revenue, which are another piece by piece we are increasing that kind of business. What's next? I think we really are stay into the day one of our company. There are a lot of things to do, a lot of things that are coming. We are continue our strategy, but is a unique strategy nowadays in the sector where we are scaling up the value chain with our offering that is an edge from the edge to AI and with a portion of SaaS business that will continue to increase year by year. My vision is to have a company by 2025 well above EUR 400 million in revenue. Why? Because I think that we can growth medium term at a superior way, well above 25% in the combination of the next three, four years. Plus, we will continue to use the leverage of M&A that as we see from the past, it is creating a lot of value for our company and for our shareholder as well. We will provide a full year guidance in April, as I said. The reason why is because we want to look very careful all the KPIs and all the numbers. Bottom line, we are facing in a very interesting acceleration of the organic growth, and also a strong acceleration into the CLEA business in many verticals. We started already in a smart city, thanks to the agreement with Pizzarotti, where we are working in different areas of collaboration. In Vending Coffee Fitness, we started working with Technogym on their machine on CLEA. Industrials with very different and various customers. In medical, we have AEL, which is one of the most important customers for the group. For all these reasons, we will provide an update on the 2023 CLEA targets in June, where we think to be able actually to raise a lot the targets that we already given to the market in the past. Our position, as I said before, is quite unique. This is the reason why we are accelerating a lot our growth path, because the customers like to have a company that can provide it to them all what they need, not only to have a product on the field that is digitalized, but also having an end-to-end solution that can provide it to them output analyzing their data. In fact, if you look at the competition, you can find many competitors on the module. Far fewer into the capability to offer what we call a system, an integrated product with an HMI. Well, far fewer if you look at companies that are able also to get the data from the edge and put the data into the cloud, which is one of the three important things that CLEA is doing. No one, except SECO, that can offer you the entire solution, an end-to-end solution working in a very plug-and-play way. That is so important and it is the reason why this company will be definitely a market leader in the next two to three years. I think another important step of evolution of our business model, it was achieved very recently with the industrial partnership with Exein. Thanks to it, SECO will start very soon in selling its product, both hardware and software product, with the Exein software solution on top on demand. Meaning that customers that wanted to have the solution of Exein, we can do something around EUR 1 per device per month. Or something better if they acquired also the CLEA stack. If you acquired the Exein solution into CLEA, you can have an advantage in terms of cost. Of course, you can choose to buy only hardware with Exein inside. This is definitely another important step because it is going to match a demand that is coming from customers. In my mind, I think really we will have a lot of demand for security when you see millions of devices that will be connected with CLEA in the next two to three years [audio distortion] My apologies. We seem to have lost Massimo there just for a moment. Well, you should be able to talk about. Sorry? I'm sorry, Massimo. We just lost you for a couple of seconds there. Oh, my God. Okay. I think it happens, but, yeah, if you'd like to carry on. I think more to come in the future because in the short term we are walking into an M&A with a focus on AI, a company that can accelerate further the CLEA go-to-market strategy. We are continuing into the evolution of our business model with a superior organic growth. Well, I think the partnership is a way to accelerate our growth path, and we are working to additional partnership in two, three couple different direction. I think also we did already a lot of work that we are doing now, the last mile of the work that we need to perform to start to generating revenue with all activity that we will expect to reach the first contract from them in this period. Also we are targeting two, three different option of big business thanks to the European recovery plan. Again, it could have three years of visibility. We are working on, I will let you know once we can conclude something. I think, just to close my point and give the space to the questions. I would like to say that, well I think in 2025, we will have a company with a good portion of revenue already into SaaS, due to the software business. I think from 2025 up to 2030, well, at that point, we will further evolve our business model, because I think at that point, the market will be ready to have also hardware as a service. I think the long-term strategy is to create a technology company with a SaaS business model for the entire revenue-wise. That's the long-term goal that I have. Thank you very much for your attention. Now I hand over to the Q&A. Thank you, Mass. We now have an opportunity for questions. As a reminder, please use the Raise Hand function on your screen, or for those dialing in, please use star nine on your keypad. Once your name is announced, please unmute your line, state your company name before asking your question. Thank you. The first question today comes from Anna Frontani. Please go ahead, Anna. Hi. I'm Anna Frontani from Berenberg. Good afternoon, everyone. I have two questions. First, can I ask for a little bit more color on the 500,000 unit pipeline for CLEA? How concentrated is that in terms of customers? And if you can provide the split between clients in the early discussion phase and maybe the ones that are actually implementing the solution. Second question on M&A. Can I ask if we should expect more bolt-ons coming through in 2022? And in light of that, how do you think about your balance sheet and the leveraging? All right. Well, regarding the first question, we have now a lot of customers in the range of 10,000–20,000 devices per year. On top of it, we are very close with a couple of customers that are well above 100,000 devices per year. Given that, I think one of these big customers we will be able to close it soon. It will be a very big customers into the boiler markets where we plan to connect well above 100,000 devices in the next couple of years. Well, on top of it, we have several different customers with several different discussions that we have now in place, and we are literally looking to increase into this kind of business. Regarding the M&A, we plan to finance the acquisition that we are discussing now is small, so we can manage with our balance sheet. We also expect to be able to generate cash during the year at a sufficient level to deleverage our balance sheet to give us enough space to continue our M&A activities. Since we see that from the past, from the acquisitions that we did in the past, that actually are giving us a lot of extra value. Also the SECO Northern Europe is starting accelerating a lot. I think we can look also something bigger in the future. If we find something bigger, we will come back for sure to the market. Why not? It could be an option, a good option to continue to generate value. It is not something that we plan to do in a short term anyway. Thank you, Mass. Thank you for your questions today, Anna. Our second question today comes from Lucas Wojtczyk. Please go ahead, Lucas. Lucas, you are on mute. Hi, Mass, and congratulations on the results. Few questions from me. First one on the revenue growth and maybe the guidance for Q1 2022. Could you give us a sense of how much percentage growth is coming from the price increases and how much is the underlying unit growth? Because obviously as we go further into the year, that's sort of the pricing element in 2023 will fade away. I'm assuming you do not expect the same level of price increases throughout the sort of the medium term. Second question on the software revenues. If we look at platform revenues with Garz & Fricke, the software was at EUR 7.2 million, which is significantly ahead of any estimates that were out there. Can you comment on what software solutions Garz & Fricke brings? Sort of what do you expect that to grow, let's say if we were to use the EUR 7.2 million pro forma basis into 2022 just for the software bit? Maybe another one on the software. You run multiple pilot programs for CLEA with Garz & Fricke customer base and ahead of the IPO, mainly with previously mentioned Technogym. Could you give us some update on how the conversion of those customers that have been piloting the CLEA is going ahead? Let's start from the last question. We are doing a lot of discussion with different customers. In the end of the story, the conversion rate is very, very good because all the customers that decide to test CLEA in their application domain, in the end of the story, they decide to use it. That's incredible. Of course, it's any customer you need to spend time with because you need to put him in a position to actually test CLEA specifically on their application. At that point, you need also to elaborate on the artificial intelligence, creating something customizing for these customers. This is the reason why it's not we cannot transform interest into revenue in a second. As you know, we are acting into industrial space. With industrial time, we will have one year. Indeed, 2023, we will see amazing results coming from software. This was your last question. Can you repeat for me the previous couple of questions so I can cover them? Yes. The first one was on the split in the revenue growth for the unit growth and the pricing growth. Yes. Second one comment sort of on the Technogym progression and whether commercial terms are sort of agreed or signed because you mentioned this during your presentation. Right. I think, first of all, in the split of revenue you are referring to Garz & Fricke. The biggest contribution from Garz & Fricke at a software level is related to the payment system, KarL4. Well, we are finishing to integrate it into CLEA. We will have it integrated into CLEA by mid-year. At that point, we will start to sell, upsell, let me say, CLEA to all the German customers that are now using the payment system. It was in the plan from the beginning. Actually, the R&D works is speed up on time. We will start to upsell CLEA on these customers starting from June 2022. Meaning that we will see the result in 2023. It's for sure we will convert most of them, at least, if not all of them, into CLEA by the end of the year. About Technogym, we did a significant progress into the discussion with them. We provided and we got already initial contracts on developing motion control, thanks to CLEA and other apps they like. Basically, the discussion is progressing extremely well. We will, when we will have, you know, additional information, we will for sure release them at the right time. Up to now, what I can say is the discussion is well advanced. Thank you. Last very quick one. On your Q1 guidance, how much growth is coming from the unit, so device growth? How much is coming from the price increases that you sort of put on your customers due to supply chain issue? I think you should think in this way. [audio distortion] Oh, it seems to have lost Massimo. Massimo, can you hear us? Apologies for the technical fault today. I don't think we will revert. I think we can be able to keep it in a long way. Anyway, it's in the range of 8%–10%, something like that. Thank you. Thank you, Massimo. Thank you, Lucas, for your questions today. Our other question comes from Matteo Bonizzoni. Please go ahead, Matteo? Yes, thank you. Good afternoon. I have some questions. The first one, I would like to know if you can provide the pro forma 2021 revenues and EBITDA. I was estimating something in the range of EUR 145 million revenues and EUR 32 million of adjusted EBITDA, just to check if it makes sense. The second question is, you have said clearly that you will provide an updated guidance in a few weeks, basically in a few days. I'm just comparing your current guidance, let's say, the one that you provided when you announced the Garz & Fricke acquisition with more than EUR 180 million revenues and more than EUR 80 million EBITDA for this year with the backlog increase. Because this, if I calculate correctly, this guidance implies around a 25% growth of revenues on a recurring basis, basically like for like, no? But the backlog is currently up more than 2 x on a like-for-like basis. I mean, either we will have a slowdown, a material slowdown of this backlog growth in the next few months, or it seems that this EUR 180 million revenues guidance, which you provided, could be outdated or too prudent. Can you comment on that? I would like to ask a question as regards the software revenues in 2021, which on a pro forma basis were EUR 7.44 million. What is the split between non-recurring engineering, which I think are still the large majority, and recurring fees? Do you have any indication at this stage on the software revenues for 2022, or also in this case, shall we wait? Then I would like to know two quick questions. One is on the CapEx, which we should expect for 2022. The other one is on the minorities, because basically minorities are absorbing more than 30% of your net profit. I think it's Fannal, but can you confirm? What is your stake in Fannal, directly, indirectly? I think there are large minorities there. Just to be able to model properly the estimates going forward. Thanks. Can you hear me? Yeah. Yes, we can hear you. Oh, Massimo, apologies, you're on mute. You should be- Can you hear? Yes, we can hear you now. Please go ahead. Okay, perfect then. Regarding the pro forma basis, yes, it was, roughly speaking, EUR 144 something in the revenue, and something less, actually EUR 32 million in adjusted EBITDA for 2021. About the guidance, we will provide, as I said, a guidance in April. You should keep in mind that the guidance that we gave to you was a guidance in October. Since October up to now, as you see, the backlog is increasing, the pipeline is increasing, the order intake is increasing, the revenue by month is increasing. I should expect also the guidance will increase. It's only a matter of magnitude because we want to be careful, but could be in a very interesting magnitude, the guidance that we will provide. Anyway, we will give you a super solid guidance because we are double-checking everything three times. I don't know, Matteo, sorry, if you can repeat for me additional questions. Yeah. The second question was on your EUR 7.4 million pro forma software revenues in 2021, including the entire year for... Got it. Garz & Fricke and ORO Networks. Can you provide the split between non-recurring engineering, which I think were still the large majority, and fees? That's the question. I would like to know on 2021... I think EUR 5 million are coming from non-recurring engineering fee, and a couple of million from recurring revenue. As you may know, starting from non-recurring revenue, you will have recurring revenue later on. That's a very good point. Yeah. Just two final question, very, very quick. They were on CapEx for 2022, because it's not easy to project the structure or let's say capital intensity of our business, including intangible CapEx going forward. Minorities, because we have seen that 30%+ of net profit was absorbed by minorities, which I think is the minorities in Fannal mostly. Can you just comment on that? Yes. In terms of minorities, we have 45% of minority in Fannal and 30% in both the two, let's say, combined. Okay? Just for your knowledge, we have in all the three put and call option to be at 100% at the right time. Okay. Thank you, Mass. Matteo, was that all of your questions? There was just CapEx that was left unanswered. Yes. Maintenance CapEx are in the range of 2.5% of the total revenue of the year as per maintenance CapEx. In terms of growth CapEx, you should see something in the range of EUR 3 million–EUR 4 million this year because we are investing into Germany to actually implementing our quality and production, additional production capability during the years and in China because we need to invest over there because the business is growing a lot. Thank you. Thank you. Thank you, Mass, and thank you, Matteo, for your questions today. We just go over to Roberto Condulmari. Please go ahead, Roberto. Yes, good afternoon. Can you hear me, Mass? Yes. Okay. I have just three questions from my side. The first one is on just you know the most recent update on supply chain post this war breakout. Is it making things worse than before the war, which were already a little bit of a problem? Also in addition to that, on China, are you having any issues related to that given what we read about you know with the COVID breakout? That's the first question. The second question is looking at slide 10 of the presentation, adjusted EBITDA in the bridge of adjusted EBITDA growth, there is EUR 3.4 million, which you call contribution from FX and other non-recurring items. Can you please expand a little bit on how this breaks down? In addition to that, can you update us on the amount of capitalized R&D costs you took in 2021 and remind us of the 2020 amount? Thank you. Okay. Well, about the supply chain, I think it's important to say that the situation is tough. It's very tough. It was tough in 2021, and SECO was able to drive in a very consistent way into this situation. 2022 expectations are for a progressive improving into the condition. It is not the case right now, so the situation is tough, still tough. Anyway, we continue to dive into as we did in the past. Regarding the war, actually the war will create a positive effect into the supply chain because the components that are going into Russia, they are coming back and they are available on the markets. Also SECO was able to get a bigger stock of important, very important components couple of weeks ago due to it. Regarding the COVID situation in China, which from my understanding is solved right now, but of course caused a delay into shipment, especially from Shanghai. Okay, regarding the slide 10, which I'm going to go there just for the benefit of everyone [audio distortion] Mass, if you want, I got it. Roberto was asking the delta on foreign exchange and non-recurring items, as you wish. Yes, we discussed it many times, but go ahead, Lorenzo. Yes, thank you, Roberto. Let's say this delta of EUR 3.4 million is the delta between the non-recurring items of 2020, that was at about EUR 3.1 million, and the non-recurring items of EUR 6.6 million of this year, 2021. Okay. In 2020, the biggest part of non-recurring item was primarily related to the stock option plan of the actuarial value of the first line of management. For what concerns instead the EUR 6.6 million of this year, about EUR 3 million is related to the stock option plan of the first line of management and all the management team. Another part is related to the stock grant that has been give on a free way to all employees on the IPO. The rest of the part, the biggest part is transaction costs related to the acquisition of Garz & Fricke. This EUR 3.4 million is the difference between the two amounts of non-recurring items of 2021 with respect to 2020. Right. Just to complete the Roberto questions about the capitalization. The capitalization level for SECO is stable, and as I said many times, is in the range of 8% of revenue. Please keep in mind that we obtain a couple of million this year into other revenue that are coming from grants from R&D. Together with the IAS 38 rules, it should give to all the investors the security that SECO is making a lot of innovation, a lot of R&D, even if we are capitalizing only the portion that are related to product, standard product that will continue to generate revenue long-term speaking. Thank you. Thank you, Roberto, for your questions today. Our final question comes from Alessandro Tort ora. Please go ahead, Alessandro. Good afternoon, everybody. First of all, let's say some follow-up, okay. I will need, if you don't mind. The first one is on the last point you touched on the R&D capitalized. Basically we can let's say think about as of today a sustainable level of R&D capitalized at around 8%, as you said, just a confirmation. I don't know, Mass, if you want to go one by one and then just Yes, yes. One by one is definitely better. The first question, the answer is yes. Okay, perfect. Second point is on, if I have to think about, let's say, the gross margin trend over this year, also because last year, if I remember well, it was like very, very high in the first part, and then, let's say, gradually normalizing. Can you help us to have an idea also because if I understood well, you should have a sort of carryover or the price increase, okay, you made in the last quarter also in this first part of the year. Thanks. Yes, we should expect to see the gross profit margin increasing into the year, especially in the second half of the year. Our expectation is to have a lower gross profit margin in the first half, comparing with the higher gross profit margin in the second part of the year. The third question is on Fannal again. I know there is a put and call, let's say, scheme inside. Considering the very strong results of Fannal, is it already good timing maybe to think about purchasing the rest of the minorities? No. The reason why Fannal, actually, we have a plan. It was a EUR 2 million company when we acquired it, EUR 2 million revenue really, and 0 EBITDA. Finally, this year in 2021, we posted over EUR 12 million in revenue and EBITDA in the range of 24%. Well, I think the plan that we have in Fannal is to be above EUR 20 million in 2022 and to continue to grow. It is growing in a very spectacular way, and I think it's not the right time to acquire it because we have the CEO of the company that owned the majority of the stake that we needed to buy, and I don't want to demotivate him. Anyway, we are creating a lot of value also from thinking to the future because we have a five-year contract of put and call that is at 8x the EBITDA. We have a lot of, you know. This is a very creative deal when we will execute it. Okay, thanks. Considering, let's say, I know that the guidance, let's say the tech guidance will be disclosed in the coming weeks, but going, let's say forward, about the medium term, if you think about your vision on 2025, is there a minimum level of, let's say, software sales you have in mind that could be satisfactory for the company? Percentage, I would say. Well, software is growing extremely well. Hardware is growing extremely well. It's really difficult to cover this question in the right way, and I'm not the people that like to give a number in a random way. It's not the right timing yet because we are growing a lot, and I would prefer to cover it later in 2023 because we will have a lot of things that we need to keep from now to 2023. At that point, we will be in a very good position to make an assumption. Not now. If understood well, we should also have, let's say, the update you mentioned before on CLEA, in June. Is it correct? Absolutely. Okay. Because... Okay. Please. Thanks. No. Because we are now in the final mile of discussion with a lot of customers. Again, I don't want to comment pipeline. I would prefer to comment contracts. Sorry, the last, let's say not last question, but if you can give us, let's say, also an update on Telecom, because when we discussed about this partnership, CLEA, there was a clear pipeline, let's say, year over year on Telecom. If you can, let's say, give us also an update on, let's say, this year or maybe just the activation, the project you're making with Telecom. Thanks. Olivetti, I would say. I think we may have lost Massimo for one moment there. No. Let's see if he comes back. No. I am here. Can you hear me? We can indeed. Yes. Please go ahead. Okay. The Telecom Italia, as I said before, the partnership is going well, even if it's not producing orders yet. We will see the first orders coming very soon. I'm not able now to see if we will do the EUR 10 million that was expecting by the partnership this year. Maybe less. Anyway, the good news is, we got a lot of orders coming through additional new customers that we are getting every quarters, every month literally. It's not a big issue. Anyway, we will have a very big important meeting with them in a couple of weeks. At that point we will have a better vision on the partnership effect. My estimation is to keep the effect as we discussed and we announced together in September, only keeping a minor delay into the first year start. Okay. That should be the outcome. I will update the market as soon as we will have the meeting with them in a couple of weeks. Okay. The last two questions are, let's say, really. Yes please. Thanks. No, by the way, the KKR offer is something that creates a bit of delays as you can imagine. Mm-hmm. Okay. Thanks. The last two are just a quantitative, let's say, question. The first one is on D&A side. If you can, let's say, help us to understand if in 2022 there will be some PPA amortization impact on your numbers related to Garz & Fricke. Also on the tax rate, I see a very low tax rate for this year. If you can help us to have an idea on tax rate also. Thanks. This is a question for Lorenzo. Lorenzo, if you can. Yes, yes. Thank you, Mass. Alessandro, for what concerns the PPA of Garz & Fricke, we had more or less a consolidation difference of about EUR 157 million to be allocated. EUR 24 million has been allocated to the customer list, okay? Gross customer list was valued EUR 33 million, okay? This EUR 33 million will be amortized during a period of 25 years. Okay? We calculated then the fair tax liabilities over these EUR 33 million of 30%. That is the average tax rate under German tax law. Okay? For the next year you can imagine that we need to accrue amortization and to release the taxes along this period. This for what concerns PPA. Sorry if you can repeat me, the other question was about tax rate, okay? Yes, yes. The level of tax rate... Yeah. for this year, considering yes, what you got in 2021. Yes. For what concerns instead the tax rate, we have this year a really good tax rate, I think, for main three points. Okay? The first point, as you know, is for sure all of the costs related to the IPO that can be, let's say, capitalized in the shareholder equity. However, all these costs are deductible from the tax base. The other point is that we activate this year, for the first year, the Italian tax consolidation rule, and we gain a benefit of about EUR 400,000 from tax consolidation. Okay? Last point is for sure all non-recurring items related to the transaction cost of Garz & Fricke. Okay? Considering that for the next year, if in the case we will not have, let's say, extraordinary operation like capital market or M&A, for sure the tax rate will come back to a normal level. It will increase with respect to this year that, as you see, has been further below than 20%. Okay. Sorry, Lorenzo. I didn't get it. For this year, 2022, the expectation is for a level of, let's say, considering. Yes, for this year. If we will be in the case not to have extraordinary operation, the tax rate will increase above 20%. While if we will have it, I will be able to manage it below 20%. Okay. I think something below 25, considering the benefit that I'm having from the Italian tax consolidation rule. Okay On the road, Italian entities. Okay. Excellent. Okay. Thank you. Thank you very much. It was a very long and productive call. Thank you to all the participants. If you have a further additional question, don't hesitate to drop an email to Marco Parisi. See you soon. Bye-bye. Thank you everyone for joining today. This presentation will now come to a close. Thank you. Thank you. Bye. Bye.