Good morning and a warm welcome to the first Accelleron Capital Markets Day. It's our pleasure to host this hybrid event today combining you here in the room with our remote participants in their offices, in their homes. A warm welcome to you. My name is Michael Daiber. I'm Head of Strategy and Business Development for ABB Turbocharging, will be in charge of Investor Relations for Accelleron, and I'm moderating today's event. Let's have first a short look at safety here in Baden. There is no fire drill planned, so in case you hear a fire alarm, please stay calm, follow the green signs here, go down the stairs, and we will meet outside, despite the rain, in front of the building. I would invite you to have a short look at the safe harbor statement that should be projected. Yes, here. As you can imagine, the presentations today will contain forward-looking information, and this type of information naturally carries uncertainties. Further, all our financial figures are prepared in our reporting currency, U.S. dollar, and prepared according to the U.S. GAAP standard. After these presentations, there will be the opportunity for Q&A. In case you're sitting here in Baden, it's very simple, you just raise your hands. For the remote participants, please use the Q&A tool on our website. Participants in Baden will have an opportunity after the Q&A to visit our factory and our test center, which are about 200 meters from here. I will inform you about these details at the end of the official presentation, and would like to hand over now to Oliver Riemenschneider, the Chairman of the Board of Accelleron. Thank you very much, Michael. Good morning, everyone, here in the room as well as at the screens. My name is Oliver Riemenschneider. I'm the Chairman of Accelleron, and with 31 years in ABB and thereof 11 years as the President of ABB Turbocharging, now Accelleron, I'm excited and really honored to guide this spin. As you will see, the energy transformation will provide the right market dynamics for us to show our strengths and to expand our market positioning and scope. To reach this end, we have assembled a board which represents strong governance experience as well as end-market knowledge. Now, if you look at the slide in the middle and top, you will see Ms. Monika Krüsi. She's Vice Chair of Accelleron, and she will also be the Chairwoman for the audit committee. She looks back to a vast experience in the industry in Switzerland as well as abroad, and has multiple years of experience in AC and NC functions also as chairwoman. We have Ms. Sons. She comes with a distinguished career, global career in HR executive roles in different companies, and that is complemented with also board assignments in different companies, including the automotive industry. We have Bo Cerup-Simonsen, Detlef Trefzger, and Stefano Pampalone. If you look at the companies, they are very renowned companies, and they have very prominent positions in those companies. They will be in a position to provide really end market knowledge, technology judgment, and business acumen from transportation, from marine, and from off-road industries to the board. The board will then support the executive committee to really deliver on our ambitions, which we will show you today. I will rejoin you for the Q&A, and now I have the great pleasure to introduce to you Daniel Bischofberger. Daniel comes with a vast background from power generation, power transmission, and from the oil and gas industries. He joined us March first as my successor, President of Accelleron, and in his most recent assignment as president of the service division, he was also a member of the executive committee of Sulzer. Sulzer is a very well-known Swiss company and stock listed here in Zurich as well. Yeah. Welcome, Daniel, and the show is yours. Thank you, Oliver. Thank you for your kind introduction, and great and very experienced board, I have to say. I'm looking forward for successful collaboration with you and the board to bring Accelleron to the next level. Thank you. Good morning, and a warm welcome also from my side and on behalf of the Accelleron leadership team. Thanks for joining Accelleron's Capital Market Day. Just a few words about this nice location here. As you in the room may have noticed, this is a historical building built by BBC, one of the founder company from ABB, more than 100 years ago. As the name of the building implies, Trafo, the original purpose was production of power transformers. The production started in 1920, just five years before the first commercial turbocharger, heavy-duty turbocharger was produced here as well in Baden. While today no power transformers are produced anymore in Switzerland, Baden, thanks to Accelleron, is the center of the world for heavy-duty turbocharging as of today. Thanks to the stock listing, Accelleron, I would say a hidden world champion, becomes visible after finally 100 years. Together with my colleagues from the executive committee, we are excited to present you why Accelleron became, is, and has all the ingredients to remain the undisputed leader in heavy-duty turbocharging applications, and why Accelleron is well-positioned to benefit from the energy transition to a net zero world. Before we start with the presentation, let me introduce my team from the executive committee. The last six months I had the pleasure of working with this fantastic team, I have to say. I was, and I'm still impressed by their deep knowledge about turbocharging technology and the businesses. They think, they breathe, they eat, they live turbocharging. I have to admit, it's almost impossible not to be infected by the turbocharging virus. Team, thanks a lot for your great support in getting me up to speed and able to present here Accelleron to future investors and also the analysts. Here's the team now. Adrian Grossenbacher, CFO since 2017. Before, Adrian held controller position in Accelleron medium and low speed, and in Alstom Power. Christoph Rofka, Division President, Medium and Low Speed, since 2020. Before, Christoph had various position in Accelleron R&D, including the last position, Chief Technology Officer. Herbert Müller, Division President, High Speed, since 2019. Before, Herbert was running Accelleron service division. Roland Schwarz, Division President, Service, since 2019, so at that time taking over from Herbert Müller. Before, Roland was heading Accelleron's joint venture in China and Japan. Dirk Bergmann, Chief Technology Officer since 2020, succeeding Christoph Roffka in this position. Before, he was in leading R&D position of combustion engines manufacturers such as MTU and IVECO. Also, not presenting today, let me introduce our last, but by no means our least member of the executive committee. Annika Paakkonen, our new Chief Human Resource Officer. Her earlier positions were Vice President, Human Resource for the Wärtsilä Marine Power division, and Chief HR Officer for the Nordic Morning Group. Tomorrow she will have her first working day. Welcome, Annika. Really glad to have you on board. A great team with strong and relevant experience and excellent track record, thrilled to write not only a new chapter, but even a new book of Accelleron. Today's agenda looks as follows. I will take you through the introduction, markets, and energy transition. Dirk Bergmann, our Chief Technology Officer, will talk about our superior technology. After a short lunch break outside, our division presidents, Christoph Roffka, Herbert Müller, and Roland Schwarz, will address their respective businesses and strategies. Adrian Grossenbacher, our CFO, will guide you through the financials, both today and going forward. I finally will conclude the presentation part of this capital market day by giving you an overview of the transaction and summarizing why an investment in Accelleron represents an attractive proposition. I guess time's to start. Accelleron is the undisputed leader in mission-critical turbocharging application, which is a consequence of almost 100 years of significant and continuous investments. Investments in technology, investments in partnering with OEM engine builders and end users, investments in an unrivaled global service network of more than 100 service centers worldwide, and investments in a unique service culture that will never let our customers down. Today, we enjoy an active installed base of 180,000 Accelleron turbochargers, which we mine 24 hours a day, 365 days a year. As a result, service is 75% of our business, making our business resilient and being the foundation for our strong cash conversion. We are reporting our business in two segments: medium-low speed, left column, and high speed, the right column, both covering product business as well as the service business, respectively. The segmentation into low, medium, and high speed is derived from the type of combustion engine the turbochargers are attached to. Low-speed engines, for example, are large two-stroke engines with up to 100,000 horsepower that directly turn the propeller of a large cargo ship with up to 200 RPM. High-speed engines on the other side of the spectrum are the smallest four-stroke engines with 500 horsepower that run with more than 1,000 RPM. As one could derive from the composition of our executive committee. We are organized in three operating divisions indicated with the three white boxes on the slide. Two product divisions run by Christoph Rofka and Herbert Müller, as well as one service division run by Roland Schwarz. Our service business is intrinsically linked with the product business value chain, while also making up one large overarching service network. Our two main markets, namely marine, which is around 50% of our business, and energy, which is around 40%, are significant contributors to the global warming. They are now undergoing a full-scale transition to meaningfully reduced emission levels, which we are best placed to facilitate. Out of the 35 billion tons of global annual CO2 emissions, energy with 34% and marine with 3% together account for 37% of annual global CO2 emissions. Both sectors have set ambitious targets for 2050. According to the Paris Agreement, the left chart, energy sector has to be net zero by 2050, mainly by replacing fossil power plants with renewable energy from wind and solar, but also thermal power plants running with sustainable fuel. International Maritime Organization, IMO, right chart, has proposed a minimum emission reduction target for the marine sector of -50% by 2050. This shall be achieved by running combustion engines with sustainable fuel instead of with fossil fuel. It is expected that reduction target will be significantly increased in the next few years closer to the net zero, similar to the energy sector. Achievement of these emission targets requires a substantial increase in engine efficiency and the switch to sustainable fuels. We are well-placed to enable both. Turbocharging was invented more than a century ago with the sole purpose of improving efficiency and through reducing environmental impact with less fuel, less emissions. What is a turbocharger? A turbocharger, by using the residual energy of the exhaust gas, here indicated by the red arrows, provides an engine with pressurized air, hence more air for the combustion process. Indicated by the blue arrows, this increase in air means that more fuel can be added for the same size naturally aspirated engine. That was a bit more the engineering approach, to put it in a nutshell, a turbocharger is a key component of a combustion engine. A turbocharger functions as a ventilator, or the way I say it, legalized doping for the engine. It gives the engine an extra boost in performance. This very simple principle has a huge impact when compared to a combustion engine without a turbocharger. A turbocharged combustion engine delivers + 300% more power. That means, in other words, if a turbocharger fails, and that's clearly never an Accelleron turbocharger, the engine loses 75% of its power. Further benefits, efficiency increases by 10 percentage points. NOx and CO2 emissions will be significantly reduced by 60% and 10% respectively. Fuel cost savings of up to $3 million per annum for large two-stroke engines. Quite impressive, I would say. It becomes even more impressive when you hear the following figures. The largest ever built two-stroke engine for marine has an output of 100,000 horsepower, so about the equivalent power of 1,000 Volkswagen Polos and a weight of more than 2,300 tons. The corresponding three turbochargers you need for this engine have a combined weight of thirty tons, so that's about 1% of the total weight. This 1% incremental weight makes it possible that the power of the engine is increased from 25,000 horsepower to 100,000 horsepower. I guess, I hope now you understand why I call it legalized doping. Accelleron has the most comprehensive range of turbochargers for heavy-duty application. From our smallest turbocharger labeled TPX on the left side for 500 kW high-speed engines to our largest A200L on the right side for 25 MW low-speed engine. From 100 kg and the size of a microwave up to 210 tons and the size of a truck. While most of our turbocharger competitors represent a small business within a large multi-billion company, Accelleron is a focused turbocharger specialist. Medium and low speed on the left side, which is more than 70% of our business, is focused on marine and energy with some business in rail. Useful life of a turbocharger is 20-30 years, and products are highly customized. High speed on the right side is mainly in energy with growth potential in off-highway vehicles for mining and construction. The useful life here is shorter, it's about 15 years, and we talk here about small serial production. Some of our competitors in the high-speed are primarily suppliers to the automotive OEMs and hence are shifting away from the combustion engine component such as turbochargers and are increasingly focused on battery electric vehicles. Some of them already decided to exit the turbocharging business. We were and are deliberately not active in the automotive segment. We now see an attractive opportunity in off-highway vehicles as some of these players are winding down their focus due to the challenges in the automotive business. If you wanna be in the turbocharging business, you need to have a long-term perspective. Three to five years for product development, 10-15 years of product sales, and 30+ years of service business. For a specific turbocharging model, it can take between 30-50 years from product development until last turbocharger is taken out of service. This requires good financial health as well as some business stamina. There will be high upfront investments in product development, manufacturing equipment, and manufacturing tools with negative to low returns, while higher returns from the service business are more backend loaded. Breakeven for a new turbocharger model is after 10-15 years, approximately five years after your service business of the corresponding turbocharger has kicked in. Hence, turbocharging business is a business with high entry barrier. Once you have overcome these entry barriers, you will enjoy the benefits of a positive feedback loop. Mining the installed base allows to generate strong and stable cash flows that can be reinvested into improvement of your product portfolio. That, in turn, will further increase your installed base. It's a kind of Groundhog Day. I guess you know the film, but unlike the one in the movie, this one you really like and you wanna keep. Our best-in-class technology is one of the key pillars of our success. We are the preferred partner of our OEM customers, so the engine builders, to achieve world-class efficiencies, power densities, emissions, and reliability. Our products achieve up to 25% higher power density compared to our closest peers and 2% better efficiency. We have a strong digital capabilities enabling us for remote monitoring and predictive maintenance. Our superior R&D capabilities are a further important differentiator. We invest every year, irrespective of the economic cycle, around $50 million, or about 10% of our annual revenues, in R&D. Our best-in-class technology and service excellence is the achievement of our 2,300 highly engaged, skilled, and passionate people with clear and aligned goals. 185 R&D engineers, the majority of them based in Switzerland, 300 meters across the street, and more than 500 service engineers around the globe who benefit from having 80 hours of training every year, reinforcing our competitive positioning and leadership. Our technology leadership is already mentioned, further enhanced through our best-in-class R&D capabilities and a portfolio of 119 patent families. We are the most global player in our field. At the bottom, you see that more than 80% of our revenues are coming from Europe, Middle East, Africa, and Asia, where most of the new ships are built and maintained. In Americas, representing 90% of our revenues, our major markets are cruise ship, gas midstream, and power. Power for both baseload and backup for the hospital and data center. Our headquarters are in Switzerland, 800 people covering the full value chain from development to manufacturing to service. We have further production site in China, production and sourcing site in China and India, all complemented with more than 100 service centers in more than 50 countries. An important differentiator in our business, allowing us not only to offer best-in-class service, but even at the doorstep of our customers. Our differentiated 24/7 service business ensures spare parts availability within 48 hours at any airport in this world, thanks to our unique service and spare parts center in Switzerland. We support our customers over the full life cycle of a turbocharger. On top of the slide from left to right, you could see that it starts with co-designing our turbochargers to help OEM engine builders develop best-performing combustion engines, and it continues at the bottom of the slide from right to the left, with optimizing cost of ownership now of the end user by implementing upgrades and lifetime extensions. Digitalization is encompassing all steps of the turbocharger life cycle, improving transparency and effectiveness for us, but also for our customers. All our main markets, from marine to energy to off-highway vehicles, are exposed to the mega trends with decarbonization and digitalization, both providing huge opportunities to Accelleron, given our outstanding competitive positioning. Since the Paris Agreement, I guess we all know, we are all aware of the high impact of fossil power on global warming. What about the marine sector? It's only 3% of global CO2 emissions. How relevant are these CO2 emissions? I would say pretty relevant. For example, if maritime industry were a country, it would be the world's sixth-largest CO2 polluter just after Japan and before Germany with 1 billion ton of annual CO2 emissions, or as I said already, 3% of global CO2 emissions. Annual fuel consumption is 3 billion barrels of oil equivalent, slightly more than aviation's fuel consumption per year. A mere 1 percentage points efficiency improvement in marine propulsion means taking at least 2 million cars off the road when it comes to CO2 emissions and $2 billion of annual fuel savings. Furthermore, green fuels are required to achieve net zero targets in our markets, which should lead to our market share expansion in the future as we are the clear leader in the green fuel space. Battery storage, especially marine, will have limited potential due to its energy storage limitation. We will elaborate on that important element later in our presentation. Let me now spend some time on digitalization. Some of my colleagues will also include some information about digitalization. Digitalization will have a significant positive impact on our and our customers' business in various aspects. Digitalization will increase efficiency and transparency of our internal business processes. You will hear more from Roland Schwarz, Division President, Service, about our IT project to replace all 21 ERP systems in our service network with one ERP, SAP S/4HANA. Digitalization will ease customer interaction with us. We have introduced myABB, the customer's portal where customer can get all the relevant information about their installed base and/or can interact with us 24/7. Digitalization will reduce customers' equipment lifecycle costs, be it turbocharger or combustion engines. Our turbochargers are equipped with sensors to fully remote monitor the health status. We are even going one step further. We are continuously developing our digital twin, which is based on artificial intelligence and physical modeling. Thanks to our digital twin and our sophisticated data analysis capabilities, we are able to offer service agreements paid by the hour with condition-based and predictive maintenance features, all reducing lifecycle costs and at the same time increasing uptime for our customers. Another digital offering, Christoph will go more into detail on that one, is our Tekomar XPERT software, a so-called software as a service. It consists of three modules. One is the engine, one is emission, and the last module is about hull and propeller. Once installed on the ship, the engine module proposes efficiency improvement for the combustion engine. We see very often 2% improvement potential. The emission module was developed even with, in collaboration with one of the ship owner to be prepared for the introduction of the new IMO regulation based on a so-called Carbon Intensity Indicator, CII. I would say it's similar to the refrigerator where you have the different class of A, B, C, and that's all about the CII. Hull and propeller is another efficiency improvement model, optimizing maintenance of the hull and propeller. I have to admit, quite a busy slide. But no worries, no intention to go through all the details. Let me focus on the main elements. First of all, sustainability is at the core of our strategy and operation. We are currently in the ESG set up of ABB, but also are now in the process of setting up our own ones. The compensation of executives will be linked with environmental and social targets, and we also intend to support UN Sustainable Development Goals. Let's first have a look on the left side about environmental impact, especially our CO2 emissions. As far as our own operations are concerned, we reduced our Scope 1 and 2 emissions already by 50%. I repeat, 50% over the last 3 years from 10,000 tons CO2 in 2019 to 5,000 tons. We plan a further 60% reduction down to 2,000 tons by 2030. 2,000 tons, which are equivalent to the CO2 emissions of only 400 cars. Definitely still we want to further reduce, but there's not so much left on the Scope 1 and 2. By the way, the reduction to 2,000 tons will be achieved by a transition to green electricity and our test facilities here in Baden starting to use green fuels already this year. Currently, we are in the process of quantifying our Scope 3 emissions. Now on the right side, some information about what social responsibility means to us. We focus a lot on our social responsibility, providing development opportunities to our local talents at one global standard and ensuring high safety of our employees. We employ about 80 nationalities in 50 countries and support communities in which we are active around the world. Through due diligence on all our vendors, we ensure that our suppliers adhere to our ethical and social standards. Our strategy is to outgrow the markets and competitors, leveraging our superior products and technology, as well as leading market position and service network, while continuing to deliver best-in-class margin, cash conversion, and capital deployment. We identified a number of clear growth pillars, which we will discuss in the course of the following presentation sections. We aim to increase market share in our markets marine and energy. We will expand organically and inorganically into adjacent areas. Adjacent areas where we could differentiate thanks to our technical leadership and service network, for example, software and engine components with high service intensity. We will continue to grow our service business by increased focus on lifetime service contracts and digital offering. We are also best placed to benefit from the transition to natural gas and future fuels. Accelleron offers an attractive financial profile with resilient margins and a strong cash flow owing to its service business. In 2021, we achieved revenues of slightly more than $750 million and an operational EBITDA margin of 25%. In 2022, we target to grow by around 6% organically and to achieve an operational EBITDA margin of 24%. The lower EBITDA margin is resulting from higher standalone costs in H2 and higher material and freight costs, not yet 100% passed on to our customers. Our midterm targets are 2%-4% organic growth in normalized inflation environment, 23%-26% operational EBITDA margin, and 90%-100% free cash flow conversion. Now let's talk about our markets. The turbocharging market can be segmented in on and off-highway applications. We are all familiar with the on-highway markets on the right side. Who doesn't know the Porsche Turbo? Cool car. On-highway markets cover trucks and passenger cars, serial production, high volumes, all high-speed combustion engine. That's not the market of Accelleron. Accelleron is in the off-highway market on the left side, consisting of marine, power generation, rail, and off-highway vehicles. This means high power, combustion engines, heavy-duty application, bespoke design, low volumes. Segments where performance and reliability are key, and hence where Accelleron enjoys a leading competitive edge. The size of the off-highway turbocharging market is about $2 billion and is expected to grow on average at 2% per annum over the next five years. The product business on the left side, 1/4 of the total market, is growing above average at 4% per annum due to a positive marine cycle that already started in 2021. 40% of product business is high speed, 60% is low and medium speed. The service business, right side, 3/4 of the total market, is growing below average at 1% per annum from a clearly higher base, but also owing to cleaner fuel and improved turbocharging technology requiring less maintenance. 1/3 of the service business is high speed, so that means 2.5x of the product business volume. 2/3 is low and medium speed, so almost 3.5x of the product business volume. Indicating that high speed is less service intensive versus low and medium speed. Marine markets represent, as already mentioned, more than half of our business. Another 40% is coming from energy. As you can see on the left side, share of the combustion engine in the energy market is less than 5%. It's a niche market, but a niche that will stay for long. The energy transition will result in significant growth of renewables, wind and solar. To compensate for this intermittent power source, grid balancing is required. Consequently, combustion engine running on synthetic fuel or sustainable fuel will play a vital role in the future energy landscape. Combustion engines are also needed as on the one hand, as backup for power for critical infrastructure, such as nuclear power plants, data centers, and hospitals, as well as on the other hand, continuous load for decentralized grids or emerging markets. In the marine segment on the right side, combustion engines are the dominant technology with a share of more than 90%. Marine will grow in line with global trade volume, hence with global GDP. Furthermore, energy transition will provide additional opportunities such as upgrades, reducing fuel consumptions and CO2 emissions, as well as a switch to alternative fuels. The two charts displayed on this slide illustrates the capacity growth addition across both energy and marine markets. We are observing and continue to forecast a good pipeline of new installations until 2026. Energy on the left side is forecasted to see a steady growth of new installation of about 3% per annum. That will more than compensate the retirement of the existing installation, resulting in a growing installed base. The right graph is illustrating that marine is expected to even experience an accelerating growth of 6% per annum, with a corresponding positive impact on the size of the installed base. Shipyards are currently booked out until 2025, 2026, which provides us good visibility for our business. Accelleron is the undisputed market leader in low and medium speed on the left side, with about 40% market share, and in high-speed gas on the very right side, with around 80% market share. We are a small player in the off-highway high-speed diesel market with less than 5% market share. Applications are backup, standby power, and off-highway vehicles for mining, construction, et cetera. It was by choice that we were not focusing on this market segment. For these customers, low CapEx, low cost on turbocharger has the highest priority, and efficiency, where we have our competitive strengths, second priority at best. No surprise this market is dominated by the turbocharger manufacturers that are primarily serving the automotive industry and hence can offer lower prices thanks to significant economies of scale. Due to these competitors pulling out, we decided to strengthen our own product portfolio with new products which are more competitive and have pressure ratio which will allow OEMs to reduce the size of their engine, translating into lower CapEx also for the customer. The keyword here is downsizing. Downsizing of engines facilitated by our products, superior products which provide higher power density, which is why we see good opportunities in high-speed diesel segment. Thanks to our strong service network, we enjoy a better service market share on our own installed base than comparing with the market shares of our competitors on their installed base. This higher service share favorably impacts our overall profitability and cash conversion. In the next few slides, we will elaborate on why turbocharged combustion engines will not only play a vital role in the energy transition, but will also have an important position in a net zero world. Thanks to our technology leadership, energy transition is clearly set to have a positive impact on our business today, tomorrow, and the after tomorrow. Why today? Today because customers are looking for upgrades and retrofits of existing installation to improve their efficiency and hence to reduce CO2 footprint. Our upgrades and retrofits reduce CO2 emissions by an average of 4,000 tons per annum for the shipping industry. Why tomorrow? Tomorrow because natural gas, due to its lower CO2 emissions, about 30%-20% less versus diesel, will substitute more and more heavy liquid fossil fuel. Natural gas will become a kind of transition fuel, and Accelleron is the market leader in high-efficiency turbocharging of gas engine, as shown in the slide before. Why tomorrow, after tomorrow? After tomorrow because green fuel is considered to be the future fuel of choice, and efficiency is becoming even more important due to higher prices for green fuels. Energy transition is increasingly driven by the push from the regulation and the pull from customers and enabled by strong progress on the technology side. Let's quickly take a look on the regulations, so the left box here. Regulations are needed to ensure a level playing field for all stakeholders. It's clear if you invest in a $200 million ship, you wanna have safety that the investment will last forever, and you don't want to jump on a new fuel, and you don't know whether it pays off. Relevant regulations for marine industries are International Maritime Organization regulations and so-called Poseidon Principles. Power generation and vehicles are regulated by the Paris Agreement. Technology, the middle box. Technology of operating internal combustion engines with sustainable fuel is or will be available latest by the end of this decade. There are already combustion engines running on bio methanol or 100% hydrogen. Sustainable fuel technology per se is not the challenge. The biggest challenge, however, will be the buildup of renewable power capacity, so wind and solar required to replace all fossil fuels. Renewable power is needed to produce the electricity, for example, for the electrical cars and the heating pumps, as well as the green hydrogen as a feedstock for the production of sustainable fuels for aviation and marine. Just to replace all fossil fuels. This is oil, gas, and coal of about 200-220 million barrels oil equivalent we burn every day with renewable energy. We have to increase the energy production from solar and wind by at least 4,000%. I repeat, 4,000%, which needs trillions of U.S. dollar investment and time. In addition, sustainable fuels are still significantly more expensive than fossil fuels. Biofuel, for example, is two to three times more expensive. As technology is still on demonstrator plant level, e-methanol is more in the range of up to 10x more expensive. Costs will come down thanks to economies of scale and better technology. Sustainable fuel will in the long run still be more expensive than today's fossil fuel prices. We hence see natural gas as a transition fuel and green fuel as a long-term solution for decarbonization in our industries. We are market leaders in both applications and will be a key enabler facilitating the transition away from fossil fuels. Last but not least, customer patterns, the right box. Customers are requesting greener solution due to regulations and ever-increasing focus on ESG. For instance, IKEA has committed to only purchasing zero emission fuels for their own ocean shipping by 2040, with the target of minimizing their average carbon footprint from every transport by 70% by 2030. Maersk's offering of net zero shipping based on biomethanol is already sold out for 2022 just because there's no more biomethanol available for shipping. One of the biggest challenge for the energy transition is how to store energy. There are many competing and complementing technologies available for energy storage. Batteries are no doubt a good energy storage solution for low power ratings and low energy storage, for example, for passenger cars. However, batteries have their limitation when it comes to storing large amounts of energy. Accelleron's markets are characterized by high power requirements, up to 100 MW, and energy storage requirements up to several GWh. That means in the top right corner of the chart where you see that the only available solution is chemical storage. That means fuel and especially green and sustainable fuel. As a comparison, the larger batteries used in passenger cars, like in Teslas, can store up to 100 kWh. One GWh of energy storage, where Accelleron's turbocharger are playing, is equivalent to the batteries of 10,000 Teslas. In addition, the battery is 40x heavier, requires 70x more storage volume than a green liquid fuel solution, such as methanol and ammonia with the same energy content. You will now see an excellent video underlying two main messages for the two sectors, marine and power generation. Marine, no way batteries will replace combustion engine on merchant ships. Power generation in a world of intermittent renewables power, small combustion engines running on synthetic fuels will be one of the possible net zero solutions to stabilize the grid. Enjoy the video. Just to share some additional color, the weight of the battery you have seen here to store 40 GWh energy for travel from China to Europe would be more than 200,000 tons. Repeat, 200,000 tons, exceeding the load capacity of the ship. Or in other words, the ship would become a submarine, which probably is not the purpose of a ship. As mentioned before, alternative zero fuel carbon fuels are at the moment two to three times biomethanols to 10x e-methanol more expensive than fossil fuel today. Based on a normalized pricing environment. In the long run though, fossil fuel must become more expensive than green fuels due to increasing CO2 taxes indicated with the upward arrow in the chart. By the way, the EU carbon costs increased by around 800% since 2018 to about EUR 100 per ton CO2. That means around 25 euro cents per liter diesel. Despite the price for green fuels coming down thanks to economies of scale and better technology indicated with the downward arrow, future fuel price will still be above today's fossil fuel price level, shown as a dashed line at the bottom. Estimates are around 50%-100% higher, making performance and efficiency gains even more important in net zero world. That means our higher performing turbocharger with higher efficiency become even more important. I would say even efficiency becomes stronger on the agenda of the engine builders on the final customer. With this slide, I have concluded my part, my first part, and will hand over to Dirk Bergmann, Chief Technology Officer, presenting Accelleron superior technology. Thank you. Dirk, please. Merci, Daniel. Thank you. Warm welcome from my side, ladies and gentlemen, here in the room and outside on the screen. I have now the pleasure to give you a short overview of our technologies of the future. With our current technology portfolio and industry-leading R&D capabilities, we are very well positioned to enable the transition of decarbonization in our market segments. We collaborate as the partner of choice with the engine OEMs in most efficient system designs for the future. We are additionally investing in our R&D capabilities, investing 7% of our revenue in 2021 into developing future-proof technologies with application even beyond 2040. In the following slides, I will elaborate in detail on how we are well positioned to lead the decarbonization transition. We, as Accelleron, are looking back on nearly 120 years of industry-leading turbocharging innovations. From our beginning up to today, we have set and are continuing to set the standard of our industry with our products. This covers manufacturing, optimizing size and weight, and always this with a clear focus on product safety. More important than ever is developing products with having sustainability in mind. We empower our customers to run their businesses to achieve the lowest exhaust emissions and transition to a more energy-efficient future. I will now take you through the main key milestones in our journey, which started with the registration of Alfred Büchi's patent on turbocharging in 1905 here in Switzerland. While the developments during the last century were mainly driven by industrialization and power improvements, in the early 2000s, the focus shifted towards emission reduction, climate neutrality, and both in combination with highest fuel efficiency. As our turbochargers have world-leading efficiencies, we supported one of our key customers, Wärtsilä, to introduce the world's most efficient four-stroke engine in 2015. Our acquisition of Tekomar in 2017 allowed us to further extend our digital portfolio with a propulsion performance monitoring system targeted to two-stroke main engines and auxiliary engine applications. In 2019, we were able to announce the most advanced turbine design, which leads to a turbine efficiency of above 90%. Innovation remains at the core of our business, and we are really thrilled to continue these exciting developments in the future. Our significant investments in R&D enables us to maintain our industry position with our cutting-edge technologies. Our total R&D investment in 2021 was $52 million, amounting to 7% of our total revenue. This is even more than many of our competitors are able to record as revenue. As you can see on the left-hand side of the slide, we divide our R&D budget into four main pillars, which comprises of technology advancements, product development, ongoing product improvements, and finally, our testing capabilities. Testing capabilities includes investment in our state-of-the-art turbocharging test center and R&D software and tools. Product development includes new turbocharger generation enhancements. Technology development includes further improvements of our core components, the adaptation to new fuel requirements, and expanding our simulation and modeling capabilities. Finally, last but not least, product improvement invest in continuous product care and cost optimization. A significant part of our R&D investment is used for our excellent staff of about 185 highly experienced full-time employees. The innovation these experts are generating lead to 30-50 patents a year, resulting in 119 patent family to date. We continue to focus and enhance our digital product offerings, which is reflected by our above $3 million worth of R&D investments. Our patents cover a broad range of turbocharging components, with 78% of our patent families dedicated directly to our product innovations. 13% of the patent families cover enhanced technologies, for example, for fuel cells, and the remaining 9% are for new methods such as 3D printing. Of the almost 80% falling into the product category, we cover the four key parts, the four key components of a turbocharger. The turbine, the bearing, the compressor, and the filter silencer, which are illustrated here on the slide on the right-hand side. Over decades, we have created an integrated workflow to optimize product development, gaining reliability and safety. We have acquired a deep knowledge of turbochargers' core components. We are able to advise our customers when their turbochargers need maintenance or replacement, which is vital to our customers as they are focused to optimize the operating schedules and replacement cycles to minimize downtime. We also offer lifetime prognosis and improving overall system uptime. The small pictures on both rectangles on these slides are showing simulation results for the exhaust flow around the turbine on the left-hand side, and casing penetration after a turbine burst on the right-hand side. We are using a data-driven approach for the development of our turbochargers, which involves investing in our vision for a digital twin for our turbochargers in field. We envisage a closed loop of data analytics, simulation of engine and turbocharger systems, and continuous product optimization will give us the opportunity to offer our customers solutions optimized to their needs. Taking more and more available real-time data and combining them with our modeling and simulation capabilities opens up a digital twin-like view on our turbochargers in the field. With this, we support our new service offerings. Roland will further elaborate in his part of today's presentation. Our cutting-edge technology portfolio results in our competitive strengths giving us the opportunity to realize premium prices. Accelleron's turbochargers are differentiated from its competition due to our deep technical knowledge and expertise, best-in-class life cycle support for owners and operators, and the aftermarket service on our turbochargers exclusively through our global service network. Consequently, our turbochargers are up to 2% more efficient than that of our competitors, and this leads to about 100 tons of fuel savings per year and vessel. With this, our customers gain twice the payback of the upfront cost of a turbocharger over its lifetime just from the fuel savings. There's also potential in future for additional savings, taking into account increasing carbon costs. On this slide, I highlight an example of a joint development with key engine OEMs. As previously mentioned, we collaborate with Wärtsilä for its W31 engine family, which was introduced to market in 2015 and gained the Guinness World Records title for being the most efficient four-stroke engine. This was the result of a five-year partnership with Wärtsilä, having had the first prototype test in 2013, introduction to market 2015, and the first serious deliveries in 2016. This engine serves a wide range of marine applications, offshore vehicles, and drilling or sub or semi-submersible vessels, and is capable of being operated with a wide range of fuels. Compared to its competitors, this engine demonstrates an up to 8% lower fuel consumption, and with this, an up to 10%-15% higher power density, and this enabled by our technology. Accelleron additionally partners with key research institutes, engine developers and operators, and driving the decarbonization of the internal combustion engine. Two concrete examples of such partnerships and international cooperations are shown on this slide. Accelleron cooperates with a large engine competence center in Graz, Austria, on the evolutionary engine technology project, which is on the forefront of innovation, as it focuses on the future operation of gas engines for power generation with variable hydrogen content. We research in this public-funded project together with other industrial partners on the necessary parameters to optimize natural gas engines performance and reliability while running on hydrogen. This project has been ongoing since 2015, with an extension of the partnership for the next year is already in preparation. Our recent partnership with Sauber involves learning from Sauber methods on the design of 3D-printed parts. It will also enable us to achieve new extended performance from additive manufacturing. For example, on titanium compressor wheels, which are lighter than the conventional aluminum wheels, but they are giving us the opportunity to gain higher performance and efficiency. On the next slide, I will a bit give you more detail on our activities using 3D printing. Our excellence in 3D printing and state-of-the-art equipment is allowing us to optimize spare parts manufacturing, which will enhance our efficiency by reducing inventory storage, working capital, and ultimately higher free cash flow for the business. As illustrated on this slide, the use of 3D printing will better position us in future to offer more efficient and timely customer experience. Optimizing our use of 3D printing technologies will lower our storage capacity, working capital, improve our resource efficiency. All of which we will shorten the lead time for these parts from up to three months today down to less than 24 hours. We are about to use these manufacturing technologies for nozzle rings spare parts, where we have a lot of customer-specific variants in field. Our core market segments will transition to various alternative fuels. For us, this transition offers plenty of opportunities for close collaboration with our customers and for our highly efficient turbocharging and digital solutions. Enabling the highest efficiency of turbochargers is not only the key to achieve lower CapEx and OPEX costs, but it additionally helps to fulfill the market focus on supporting decarbonization trend in future. The IMO, International Maritime Organization, has a 2050 target to reduce carbon intensity of the transport work by at least 70% effectively. With a wide range of other CO2 reduction legislation, we expect a wide variety of new alternative fuels. First sustainable fuel-powered vessels will be in operation latest by 2025. While most of the fleet is expected to reduce its carbon footprint by slow steaming or some drop in fuels or blendings. Our benefit is that we are able to create highly efficient turbochargers that support these alternative fuels. We are at the leading edge of this on all key prototypes. Now coming to a specific highlight towards the end of my presentation. I'm going to give you a more long-term outlook into the future of highly efficient and climate-neutral energy conversion and propulsion systems. The turbocharged high-temperature fuel cell will bring our marine and energy industry into the era of global decarbonized businesses. High-temperature fuel cells operating at 600-800 degrees Celsius can run with different fuel types, including those which we expect to be used in future main propulsion and power supply systems in our markets. Rather than combustion, the turbocharged fuel cell generates clean electricity through an electrochemical process. Pressurizing these fuel cells significantly improves the efficiency and the power density. Most important for our business is that turbocharging principles from internal combustion engines can widely be applicable to fuel cells too. Turbocharging fuel cells increase power density and therefore enables downsizing of these systems. In fact, turbocharged fuel cells are over 10% more efficient than those fuel cells running under ambient air pressure. The market opportunity unfolds for us as we expect applications across all ships and power supplies where we today see high base load auxiliary engines or high electricity demands, for example, on cruise ships. Therefore, we do consider ourselves ideally positioned to capture such opportunities both in our current and future markets. In summary, and if there's one point to take away, it is that our extensive R&D efforts have allowed us to establish and gradually reinforce our market-leading position via superior performance, high quality and reliable products, future-proof technology and digital offerings. Thank you very much for your attention, and I now hand over to Michael Daiber. Thank you very much, Dirk. I have the pleasure now to announce the lunch break. The Baden participants, there will be lunch and drinks served just outside here in the lobby, and I would kindly ask you to be back here at 12:40 P.M. Hello, and welcome back. Thank you very much. Hope you enjoyed lunch, had good discussions, and are energized for the second half of the day. I will now hand over to Christoph Rofka, Head of the Medium and Low Speed Division of Accelleron. Christoph, the floor is yours. Thank you, Michael. Welcome back, ladies and gentlemen. It is my pleasure to start the second part of today's event with the business strategy of our medium and large products. The first slide shows you application examples of the industries we serve. The biggest industry for us is merchant marine, the backbone of global trade, consisting predominantly of container vessels, as pictured on the left, tankers and bulk carriers. Together, these type of vessels account for some 60% of our market. In the center, cruise and offshore wind, two other important marine sub-segments that, together with other main propulsion applications, account for some 20% of the market size. Last but not least, on the right side, power generation with typical plant sizes of 100-200 MW covering the remaining 20%. While a turbocharged internal combustion engine is the prime source of energy in marine, it is in competition in power generation with gas turbine-based technologies. Let us look at some key figures of our medium and low speed business. In 2021, this segment recorded revenues of just above $550 million, split up over a broad range of customers, with the top 50 covering about half. With most of our customers, we have a long-lasting and very close relationship covering various functions and management levels. The product business we conduct directly with engine OEMs, and in service we interact mainly directly with end customers, where service has by far the bigger number of customers. In the center, in product, in both businesses, we have global market shares of approximately 40%. Product business, we have two main competitors with a similar broad product coverage and various smaller typical second-source turbocharger makers. In the aftermarket, most of the service is provided by the OEMs, meaning that it is predominantly the turbocharger makers covering their own population with only a small portion of service done by third parties, and those more are non-Accelleron installed base. Over the next years, we expect solid growth, solid market growth in the product business, mainly coming from marine. While service is forecasted to see small market growth rate in relative terms, mainly caused by the phase out of older turbocharger generation and the use of cleaner fuels, both resulting in lower service intensity of the installed base. The figures show market size while our ambition is to outperform the market with new offerings, and Roland will elaborate later in his part. A competitive and well-balanced turbocharger product portfolio is obviously essential for our business. Besides covering the broadest range in the industry with a sound mix of mature products phasing out and new generations phasing in, we increasingly add turbocharger types tailored for specific applications to achieve best value for our customer. Our Power2 800-M generation of turbochargers, for example, has been specifically and concurrently developed for Wärtsilä's industry-first pure two-stage medium-speed engine, which Dirk also proudly presented in his section. It is a natural consequence of our collaboration with Wärtsilä in the field of engine and turbocharging, and it is recognized by the Guinness Book entry for its fuel efficiency world record. The latest product launch is the so-called MXP series, tailored for marine auxiliary engines up to 2 MW, installed predominantly on ocean-going bulk carriers and tankers. It is a segment where we have been strong since long. This time, close attention was put on customer feedback calling for simplicity, robustness, ease of service, and performance characteristic that match these particular applications. For the very first time, we conduct development work jointly with our licensee and joint venture partner IHI in Japan. Another first is the inclusion of digital elements like GS1 coding, a self-service app, and access to our customer portal. All elements for potential alternative business models we are currently exploring with lead customer. In such a business model, the crew identifies service needs with the support of the MXP app, identifies required spare parts immediately by the GS1 code, and orders via the app either to Accelleron or to the engine OEM. Latter has access to our customer portal, where data is shared enabling him to quote fast and accurate. By doing so, the hit rate of the OEM potentially increases, and so he can increase his service business with parts supply from Accelleron. Our latest product addition, the so-called CRRMS, is tailored for the Chinese river shipping. A sizable but rather new marine sub-segment for us where we see substantial revenue potential. This potential is increasingly or is resulting from increasingly stringent local emission regulations and a very aggressive engine upgrade program by one major local OEM. As time to market is of essence, we put very special emphasis during the development on parts commonality with existing products. While with a conventional approach, we would need fourt to five years, we are on track to release the first so-called CRRMS-type turbocharger just about 1.5 years after the start of the development. We expect to commence first commercial deliveries in Q4 this year, followed by a fast ramp-up already next year in 2023. The overall potential is some 2,000 turbos corresponding to about $10 billion per year in a market that has been dominated by low technology, non-Accelleron products so far. The capability to develop and ramp up fast as well as cost efficiency are key success factors for this initiative. Both are enabled by close collaboration between our teams in China and Switzerland with strong engagement of the customer. As we speak, the first few trials are in commissioning, another very important milestone. Another strategically important development covers the next generation products for large, medium, and low speed engines, addressing almost 50% in terms of market coverage. These applications we see already significant R&D budget allocation to explore the use of net zero carbon fuels, like green ammonia, for marine or green hydrogen for power generation. First pilot projects are scheduled for 2025, followed by an exponential ramp up towards 2030. In this output range, the conventional way of product development takes about five years, is based on a rather precise set of requirements, and followed by another four to five years ramp-up in the market. In the context of decarbonization, however, this approach obviously is not appropriate anymore. As the industry moves forward, we will learn how to best use future fuels and internal combustion engines, and the ability to learn and adapt fast based on our extensive know-how will be the new competitive advantage. In response to this new normal and to align fast learning cycles with slow hardware development, we reinvented our way of working. Already a couple of years back, we have started to develop turbocharger core technologies addressing universal requirements like efficiency, weight, and compactness, rather than following a very narrow set of detailed requirements. Now, as we speak, we are developing a platform-based turbocharger concept that allows us to swiftly integrate these complementary technologies as needed based on the learning. We are not only learning what is needed, but in parallel, we explore new ways of how to develop competitive solutions faster and more flexible. It goes without saying that we are aiming for nothing less than another industry benchmark in terms of performance, compactness, weight, and application variability. A truly exciting journey. Let us have a look now in our digital offerings. In 2017, we acquired Tekomar Group, a small Swiss-based startup-like company with very experienced engine experts and back then a relatively simple Excel-based engine advisory software with manual data readings and input. By now this software product has been truly digitized, allowing for automated readings from the vessel's alarm and monitoring system, data transfer cloud to cloud, and onshore fleet monitoring. Sales shifted from one-off payments to subscription-based models, leading to much more predictable revenue streams. Modules beyond pure engine advisory were added, including obviously turbocharger as well as hull and propeller. XPERT offering is beneficial for the overall portfolio as allows us to better track our installed base and be closer to our customers. Proven success factors of the offering software being OEM agnostic and a built-in immediate advice rather than a required link to an engine expert. Of course, it is fuel saving potential equivalent to 1 ton per day for a medium-sized container vessel, equaling approximately 2% of total fuel consumption. With the latest features around hull and propeller, we are adding potential for further cost savings that are up to 10x higher. The acquisition of Tekomar has been the backbone of our digital journey ever since. The new offerings and the way of working has further enhanced our customer intimacy. In addition, we increasingly get access to real operational data, which we use to better design our product and shape our offerings. The latest release is building now the key bridge to lifetime digitalization around the turbocharger. With Turbo Insights, we are providing now ship owners the possibility to get digitally connected already during the project acquisition phase and from a running hour zero in return for providing operational data. Once the real-time data consent form is signed and the project is decided in favor of Accelleron, customers get access to our portal, providing him with information on how the engine and the turbocharger are performing in comparison to the engine factory acceptance test. During the first sea trial, the customer learns if he get what he was asking for, and during the ship's warranty period, the customer can judge if the system is working as expected. However, Turbo Insights does not include any analytics, but all the infrastructure and data collections are in place for great upselling potential at a later point in time for our smartly enabled services and Tekomar XPERT licenses. Let us have a look, a closer look into the dominant industry trend, decarbonization. We see a continuously increasing level of ambition from various stakeholders in marine and energy, including not only regulatory bodies, utilities, shipping companies, and equipment makers like us, but also from cargo owners and activist groups. It is our clear ambition to actively steer in this journey the best solutions of today, reflecting by superior power density, fuel efficiency and flexibility, and performance advisory, but also to actively drive the thought process of how to achieve the increasingly ambitious targets. We are proud to claim a good start in that area by being selected as the partner of choice for all first commercial green methanol projects. However, methanol is still early on, with first pilots being deployed. Transition to other cleaner fuels in both marine and energy has been materializing for more than five years now, with a wider adoption of gas. Natural gas is seen as a transition fuel of choice in both industries, away from liquid fossil diesel towards net-zero carbon fuels like green ammonia, methanol, and hydrogen. While in energy, gas is already dominant with a share of gas above 70% already in the second consecutive year. Marine is just gaining speed, with the share of gas increasing to above 20%. An important KPI for us in this context is our participation in this transition, measured in our market share in applications with new fuels relative to our overall market share. Values above 1 indicate that we have continued to secure higher market share in transition fuels than in our overall portfolio, which is ultimately leading to a market share expansion on the group level as the mix is shifting towards greener fuels. We can rightly claim to be the market leader in clean fuels with clear evidence of Accelleron winning market share on the back of the happening energy transition. Let me conclude with a summary of our growth opportunities in the medium and low-speed segment. In the medium term, the launch of CRRMS for the Chinese river and coastal market, the further ramp-up of Tekomar XPERT, the ramp-up of MXP, and market uplifts post-COVID, like for example, in merchant marine and in cruise service, are the main levers for growth. While long-term, the adaptation of next-generation axial turbocharger and the leading participation in the uptake of future fuels are set to drive our top-line growth. With this, I come to an end of my part and hand over to Herbert to share the business strategies for high-speed products. Thank you very much for your kind attention. Herbert, the stage is yours. Thanks, Christoph. Welcome to the high-speed division. It's my pleasure to introduce our innovative solution to you, which will enable us to outgrow the market growth by addressing the challenges in the market, the decarbonization, and the increase of engine power density and engine efficiency. Our high-speed products are used in the energy, marine, and off-highway end markets. High-speed engines providing power to applications between 500 kW and 5 MW. High-speed engines cover the power range below the medium-speed engines. Energy applications are by far the largest segment in high-speed. The engines are scalable as they could be put in a container. As the picture on the left shows a high-speed engine in a container. Containerized solutions are easy to relocate and quick to commission. Such modular concept allows the operator to react fast to changing markets or make rental power business model feasible. Energy applications cover all kinds of electrical power generation, known as EPG. These range from EPG baseload to EPG balancing and EPG standby applications. Baseload applications are decentralized solutions that provide continuous power to the grid. They are running up to 8,000 hours a year. Balancing applications are solutions that balance the grid while other energy sources, like solar and wind, have fluctuating power supply. A stable grid requires that supply and demand are always in tune, otherwise there is a risk of a shutdown. They run between 2,000 and 4,000 hours a year. Backup or standby applications are used in emergency situations to power mission-critical infrastructure such as data centers, hospitals, shopping malls or large buildings. Gas compression is another important application in the energy market, where pumps are powered to push gas and oil through pipelines. Marine and off-highway complement the key markets in high-speed. Tugboat, working boats or short range ferries are the main marine application. While mining, drilling, construction, and agriculture are the major off-highway end markets. The high-speed market can also be divided into two segments: gas-fueled engine and diesel-fueled engines. Gas-fueled engines are nearly exclusively used in energy application. The main application for diesel-fueled engines are EPG standby application for data center, hospitals, and buildings, covering roughly 50% of the demand. The other end markets in diesel are marine and off-highway. Let's turn to the market drivers and their impact to our division. There are a number of factors supporting favorable growth outlook in the high-speed market. The electrical power demand is set for growth in the next decade, driven by the digitalization and electrification, which will require investment in new capacity and infrastructure, such as power plants and data centers. To stay competitive, the engine builders are continuously improving their engine power density to reduce their cost per kilowatt and, improve their engine efficiency to reduce the operating cost per kilowatt hour. Higher efficiency means as well lower emissions. Finally, the energy transition to CO2 neutral future impact the high-speed engine industry as follows. There will be a growing share of renewable power sources, resulting in higher demand for balancing. Where high-speed engine today win a fair share in this balancing power market. The value of engine efficiency gains important. Due to the rising total fuel cost, we expect higher cost for CO2 neutral fuels and higher prices for CO2 certificates. The operational flexibility will face high requirements to run an increased fuel ratio of CO2 neutral fuels and their blends with traditional fuels. High-speed engine are well-positioned to provide solution to these markets. Accelleron as technology leader has solution ready to enable higher power density and efficiency today. Our high-performance turbocharger enable the operational flexibility required to run different fuels and fuel blends for the CO₂ neutral future. Accelleron is ready to leverage the market trends with our innovative solutions. I would like to share a few facts on the high-speed market and our business. In 2021, customers spent $206 million for our solutions and services. Our competitive position in gas and diesel market is summarized in the middle of the slide. In the gas segment, we establish a leading position due to three factor. First, our technology leadership. We make products for the future available today, enabling our engine OEMs to develop their next-generation products. Secondly, our ability to deliver competitive products with highest quality and respond rapidly to changing demands. Thirdly, our outstanding global field service support over the entire lifetime of our product. As gas gains importance as a transition fuel, we expect gas engine market to benefit, especially in cogeneration heat and power, also called CHP, where engine efficiency up to 90% are reached. Accelleron will leverage this opportunity to further grow volume with our leading position in gas. In the past, we deliberately did not focus on the diesel segment, which is visible in our current competitive position. Let me explain why. The diesel segment is dominated by EPG standby application, where initial upfront cost of the equipment and startup time are key requirements. In the past, the preferred solution among customers was to use high number of small turbochargers, which are usually produced by on-highway turbocharging companies. These smaller turbochargers were not part of our portfolio and we were missing the economy of scale from the on-highway business to compete. With the ambition of the engine OEMs to further raise power density and efficiency, we now see sizable opportunity to gain market share in the diesel segment with new dedicated products within or close to our portfolio range. Our new products are more competitive and allow a material increase of engine output by increased power density, which translates into meaningful upfront CapEx savings for the end users. Moreover, some of the major players in this space are facing increasing headwinds in their automotive core business. Consequently, they are faced with a strategic challenge to respond to the fast electrification in the automotive space. I will share more details on our activities in the diesel segment on the next slides. The market growth by market segment is 3% in gas and 1% in diesel, resulting in a total growth of roughly 2%. With our leadership in the gas segment and new dedicated products in the diesel segment, Accelleron is well-positioned to outperform the growth. We are convinced our innovation and service network will enable that. One of the levers for success is our current product portfolio, which I would like to address next. Accelleron offers the broadest and most modern portfolio in the high-speed gas industry. Our portfolio is ready for the future and for carbon-neutral fuels. Our modern concept allows for mass customization and creation of tailored solution with maximum value, but without an excessive portfolio breadth, resulting in an effective inventory management. The installed base of more than 70,000 turbocharger in operation is the foundation for our service business. We constantly grow our expertise and the experience in running with future fuel to stay a preferred partner of the engine builder. The turbocharger performance will be key in enabling fuel flexibility. Tests have demonstrated that our current turbocharger could run from 100% natural gas up to 30% hydrogen blending without compromising on efficiency. This is sufficient for the current infrastructure, where the hydrogen content is limited to 15%-20%. Now, I would like to go into more details on our latest innovations. With TPX, we launched our first dedicated diesel turbocharger in 2020. Within 18 months, we have been able to sell more than 1,000 TPX. Our value position of power density was well received by the EPG standby market. TPX turbocharger achieve 5.2 bar pressure ratio, which is 30% higher than the third-party turbochargers applied before on the same engine. As a result, engine power output was increased by 20%. Genset weight was reduced by 30%, and box volume was reduced by 16%. The box volume stands for the space a genset occupies in a building. The power density increase resulted in a lower CapEx per kilowatt, which is an important metric in the EPG standby market, where this specific engine is deployed. The A101-H is our second step into the diesel market. The two plant frame sizes are already in testing and qualification. They are based on our existing A100 gas designs to reduce development efforts and technical risk. A dedicated new turbine allows meeting diesel requirement with regards to cyclic operation and part load efficiency. Prototyping on customers' engine has already started. With the launched TPX and the future A101-H, we are ideally positioned to expand our market position in the diesel segment. In our gas portfolio, the A200-H is shifting the boundaries of single-stage turbocharging to 5-6.5 bar pressure ratio and over 70% efficiency, outperforming competition in both these metrics by at least 5%. Keeping a single-stage setup reduces engine complexity by eliminating the intercooler and reducing piping efforts, which also allows for lower weight and cost when compared to a two-stage setup. The first A200-H frame size is fully qualified and released for sales. Several engine OEMs are now testing A200-H on their new engine developments. We expect first commercial application within the next 12-18 months. A200-H offers the engine builder options to further develop their engine to higher performance, and it will strengthen Accelleron's position as technology leader in this segment. A200-H will be the successor product for A100 for application where higher power density is required. The following three examples demonstrate our readiness for running carbon-free fuels. In Southern Europe, nine gas engines with eighteen turbochargers are running on high hydrogen blend. In total, the turbochargers have accumulated 1.6 million reliable running hours at hydrogen blend of above 50%. Maintenance is comparable to natural gas operations. In 2020, INNIO awarded us the turbochargers for the first MW-scaled engine running on 100% hydrogen. This INNIO Jenbacher engine is fully fuel flexible from pure natural gas to 100% hydrogen and reaches in a combined heat and power operations an efficiency of 93%. Biogas from organic material or organic waste is source for carbon-neutral fuels. Accelleron is a very well-established market leader in biogas and has provided its turbocharger for several thousand engines over the last two decades running on different kind of biogas. These examples showcase that Accelleron's high-speed solutions are ready for the carbon-neutral gaseous fuels of tomorrow. To grow our business, there is an attractive opportunity for us to strengthen our position in the high-speed diesel. We do believe the timing is right to invest into this segment now. Let me share some details with you. Despite an adaptation of electrification in some end markets, high-speed diesel engine will continue to be crucial. In applications with high power demand, limited running hours, or in remote operation, as diesel engines and their fuel system are robust, simple and reliable. CO2 neutrality in this application will be reached by a gradual adoption of synthetic liquid fuels. Demand for higher power density and efficiency will require new performance level from the turbocharger. Our innovative products are best placed to deliver that level of performance. Accelleron is investing in new dedicated products for high-speed diesel segment, meeting specific application requirements and offering additional value to its customer by tailored mass-customized products like TPX. The first adoption of our diesel products in the EPG standby for data centers. We are testing our diesel products on different engine platform where marine and off-highway application are targeted as well. This is scope to grow our segment share in the diesel segment from just above 1% in 2020 to 8% in 2026, resulting in a 36% annual growth rate in this market segment. I would like to summarize how our initiatives address the market trends and translate in our growth story. Global demand for electrical energy is set for growth, driven by electrification, digitalization. High-speed engines offer scalable and agile solution to react fast to this demand. High-speed engine offers solution to the energy transition challenge, as they are ready to burn CO2-neutral fuels, such as hydrogen, biogas or liquefied synthetic fuels. Their flexibility and fast ramp-up capability make them a viable solution to the increased demand of balancing power. Finally, gas is seen as the bridging fuel to replace coal during transition, where we leverage our strong position in the high-speed gas segment. High-performance Accelleron turbochargers with their superior power density and efficiency capability paired with the ability to offer tailored solution makes us our customer first choice for engine development. We are convinced in our ability to beat market growth, first, by leveraging our position in gas via driving further innovations. Secondly, by strengthening our position in the diesel while investing in new dedicated products. Third, by servicing the growing installed base globally with our multichannel service approach, with customized solution to both the engine OEMs and the end users. Each of the three levers will contribute equally to the mid-term growth ambition, which is to outperform the market growth. That concludes my introduction to the high-speed division of Accelleron. I thank you very much for your attention and will now pass over to Roland for the overview of his service division. Roland, the stage is yours. Thank you, Herbert. Dear ladies and gentlemen, good afternoon, and also very warm welcome from my side. Now, I would like to share with you the characteristics of Accelleron's market-leading service business. We operate our own global sales and service network, which is a major differentiator compared to our peers. Via our own network, we sell spare and wear parts and provide turbocharger services. Our well-established and highly regarded by customer service platform allows us to demonstrate earnings resilience and is based on the following three key pillars. A large and steadily growing installed base of turbochargers. Secondly, we offer full cover service model to our customers, which includes lifetime service agreements and digital offerings. Third, we have multi-decade established relations with our major customers and enjoy high customer loyalty, which allows frequent engagement. This allows us to generate resilient and predictable recurring revenue stream in service. Service after sales after service is our closed loop approach. I would like to show you a short video about our operational excellence in service. Our mission in service is to offer turbocharging services and solutions that help our customers to be successful in their business. This graph illustrates revenue streams from turbochargers applied on vessels based on a standard 20- to 30-year lifetime of a vessel. Turbochargers are typically maintained during regular dry dockings, which on average take place every five years, but also on ad hoc basis in case of any breakdowns. Although a turbocharger typically lasts the lifetime of a vessel, there might also be potential for a turbocharger to be upgraded, modernized during the lifetime of a vessel. Our best-in-class service network and high-performance reliable spare and wear parts make us preferred choice for our customer throughout the lifetime of a turbocharger. With almost none of the customers switching to other service organizations and us having a very loyal clientele. Turbochargers applied on large diesel and gas engines are products which are mission-critical and performance relevant and therefore require regular maintenance to ensure best performance. On average, a turbocharger applied on a merchant marine vessel main engine runs about 5,000 hours per year, which is almost the lifetime of your car. Velocity at the tip of a turbine blade is close to the speed of sound. I think these facts alone illustrate that our turbochargers should be able to constantly withstand meaningful wear and tear pressure and hence be regularly and well-maintained. Our different offerings can be tuned to the specific needs of our customers and their individual operation and add value over the lifetime. As we go along, we increasingly incorporate digital elements and new business models to add further value to our end users and engine OEMs. On this chart, on the left side, you see the development of engines powered with Accelleron turbochargers in GW. The shipping boom and increasing demand for power enabled us to significantly increase our installed base over the past 15 years. Most of our turbochargers are applied on low and medium speed applications with assumed lifetime of about 25 years, same as the lifetime of a vessel or power plant. Some turbochargers operated even much longer. Today, we still service turbochargers which were designed in the fifties of last century and have been in operation for more than 50 years. Thanks to our strong position as technology leader, we are able to maintain or even increase our high market share in the product business, and therefore we expect new turbochargers to be put into operation continuously, which will require regular maintenance for again, at least another 15-25 years. For the last 10 years, we have had an unchanged healthy age structure of turbochargers in operation. With average turbocharger age being slightly below half of the assumed lifetime. We expect to service a well-known and slightly increasing installed base and to grow our service revenue above market thanks to growth market penetration supported by tailored service offering and service agreements. Winning in marine turbochargers requires a global service network with proximity to major ports and shipyards. We have been operating our own global sales and service network already for many years and do not rely on third-party agents or any dealer network. This gives us direct and unrivaled access to customers and ensures also lean operation. Today, we operate our own global sales and service network consisting of more than 100 service locations in more than 50 countries on all continents, which is one of the biggest and best-in-class service networks in the space. In order to cope with the expected increasing demand following the installed base growth, especially between 2000 and 2010, we have significantly expanded our footprint in the last years, increasing the number of service stations from 75- 109. With our more than 200 dedicated service sales experts, we are close to owners and operators of our turbochargers to promote our service products, and at the same time, we are able to influence end users also on decisions on new projects. With our more than 500 dedicated and trained service engineers, we service more than 60 turbochargers per day and this 365 days a year. All our service engineers are trained and certified according to Swiss quality standards with trainings here in Switzerland to ensure same high level of service across the globe. With our own global sales and service network, we proactively follow and cover the installed base in all applications and market segments. We provide service either directly to the end user or the operator of the equipment or in collaboration with our engine OEMs. Last but not least, safety and operational excellence are key in our global service organization. As part of our proven and I think successful business model, we foster local-to-local business in service, and hence our local units own the customer relations while we operate one central warehouse here in Baden. Main reason for this strategic decision is that the products of our customers are moving, and we benefit from our proximity to the factory, especially in cases where we have urgency, where time is really of essence. Current location also has excellent global logistics set up, which is a further important differentiating factor. Knowing that orders are frequently required to be delivered on the same day, we have tailored our logistics to the nature of our service business, and we operate three daily shuttles to Zurich Airport to support and serve our globally acting customers. We offer spare parts delivery to the airport of destination within 48 hours with a 98% availability. In our service organization, we also continuously invest in further process automation and prioritize investments which ensure efficiency of capital employed. Our service business has substantially evolved from the traditional reactive offering of spare parts and preventive non-committing maintenance to modern business model such as service agreements and availability-as-a-service, which is illustrated here from left to right. These modern elements of our service offering are a major differentiator from our competitors who primarily continue to focus on the traditional spare parts and labor service models. Our customer proximity, expertise in our unrivaled global service network, as well as unique turbocharging-specific tools allow us to successfully deal with the increasing complexity of the customer demand in service. As an example of the many unique tools we have, ATURB is our comprehensive and unique customer relationship management tool providing installed base information, including but not limited to technical configuration, service history, and maintenance scheduling. We will continue to develop maintenance management agreements which already allowed us to make a good transition from fix-it to keep-it-running offering and decouple pricing of services from purely parts and labor cost. We offer multiple service agreement types tailored to application-specific and customer-specific use cases. There are clear benefits to customers in switching from the traditional transaction services to maintenance contracts. Costs of traditional service fluctuate a lot, leading to high unpredictable one-time costs and also a meaningful increase in maintenance cost as ships age. With our Turbo LifecycleCare agreement, we offer full service package and operational peace of mind priced based on running hours. This helps our customer to better plan their budgets and cash flow without expensive single service events, and at the same time ensures peak performance of their equipment. As part of our journey, Accelleron service scope will increase further, which is a major differentiator compared to our competitors and adds real value for our customers. To sum up, we expect that to further grow in structured service agreement to increase our market penetration, our digital and operating data analytics capabilities will further support our journey from preventive to predictive maintenance, allowing us to provide availability as a service and allowing for our customers to optimize performance and maintenance. Turbo MarineCare is our latest service product for two-stroke merchant marine customers. We believe that Turbo MarineCare is an innovative and unprecedented offering for this market. It's a fixed price service agreement which covers all services, repairs, and parts required. Maintenance will be done during dry docking so that the vessel can operate smoothly from dry dock to dry dock without further intervention on the turbocharger. Thanks to operational data, the customer will get clarity on equipment health as we monitor turbocharger and conduct health assessment. Further main benefits of Turbo MarineCare for customers are financial predictability, peace of mind, and ease of doing business. Please always remember, the opportunity cost for our customers of not being able to run their fleet due to downtime of an engine or turbochargers are significant. One day of standstill of a large container ship cost them easily about $100,000 in lost revenue and incremental cost per day. We achieve slightly higher revenue with Turbo MarineCare agreement compared to the transactional business since we add more value to customers with manageable risks. Smartly enabled services allow us to individually optimize turbocharger maintenance, performance, and customer experience. Leveraging operating data, we use turbo analytics to understand how turbochargers are operated and to develop anomaly detection models. We are also now starting to develop digital twin capabilities, which will allow us to enhance our turbocharger health analysis with predictive capabilities, further tailoring our service offerings towards individual customer needs. Furthermore, we are implementing machine learning and predictive maintenance techniques to go from standard general assumptions about turbocharger operating limits and maintenance requirements towards limits and requirements specific to each individual installed turbocharger and based on its particular data readings, which allow us to individually optimize maintenance, performance, and customer experience. Operating data in combination with Accelleron's knowledge and expertise as well as the synergistic combination of smartly enabled services and Tekomar products, as has already been explained by my co-colleague Christoph, will enable provision of digitally enhanced turbocharging services, engine performance advisory, and additional advisory services going beyond classic turbocharging to create additional customer value. At the same time, we are currently enhancing customer experience with a new way of interaction and collaboration through our customer platform called Loreca, which facilitates further the ease of doing business for our customers. We have a dedicated team within our service organization, which is responsible for developing and selling upgrade packages. Upgrades improve our value proposition in service and are an important additional differentiator from competition. On the left side, you find the key upgrade benefits for our customers, which are higher power output, lower fuel consumption, or longer lifetime of components. I would also like now to share a concrete example of a recent ferry project with you. The customer investment in 1 vessel is $0.8 million, which compares to expected annual fuel savings of, in a normalized fuel price environment of course, of more than $0.2 million. This leads to 1,400 tons CO₂ reduction per year, equivalent to more than 22,000 trees planted every year. Additionally, payback for the customer is less than four years, and by considering a reference investment in turbocharging maintenance which would anyhow be required, it is only two years. Accelleron is well positioned with a strong upgrade package portfolio, developed also in cooperation with engine builders to promote and capture the upgrade opportunities. Accelleron has all the required technical capabilities and experience to provide both complete turbocharger upgrade solutions and retrofit, which means replacement of a competitive turbocharger with Accelleron products, including class certifications. Regulatory and social pressure towards decarbonization in shipping industries such as CII, EEXI is continuously increasing. Upgrades are therefore essential to enhance performance and reach the sustainability targets. Therefore, the demand for modification of existing installed base is expected to increase continuously. By leveraging our well-established and unique global sales and service network and being a single point of contact to customers for premium turbocharger services, we are developing further service products and offerings. Firstly, based on increasing demand from our customers, we have decided to offer customers with mixed fleet service agreements also for non-Accelleron turbochargers in order to support them with a single point of service for turbochargers. We can utilize our service organization and our skilled people for this. It goes without saying that our people are properly trained on these products, and we use original parts only. Secondly, we are currently also piloting a fleet management initiative, dedicated main engine and auxiliary engine service offerings for ship management companies. The importance of this channel seems to be gaining traction, which is evident from the increasing number of vessels managed. The benefits are optimized business communication, reduced administration efforts for both Accelleron and the ship management companies, and a single point of turbocharger service contact for the customer. Furthermore, we can maximize value by combining service of non-Accelleron turbochargers with other products like Tekomar. This offers for Accelleron opportunity to ensure resilient revenue streams. The implementation of a global ERP system offers great opportunity to improve productivity and operational excellence in service operation, management, reporting, and also transparency. Service business processes shall be globally standardized and applied in every country of our global sales and service network. We will use SAP S/4HANA public cloud, enhanced and customized with our fully integrated, dedicated, and comprehensive ATURB for quotes and service job performance. This is part of our global service operation strategy, which is based on the following three pillars. First, global collaboration, a more integrated sales and service network with the customer at the center of all what we do. Second, central operation team executing operation processes globally, enabling therefore the local units to be optimized, grow, and focus on local customer care. Third, globally standardized processes through one global service ERP and customer relationship management and one integrated management system covering safety, quality, and operational excellence. Expected benefits for our customers are standardized and more automated business processes, enhanced inventory transparency, and faster customer order execution with even higher quality in our service execution. Thanks to standardization, reduction in redundancy, improved data quality, better collaboration, and productivity improvements related to our incorporated dedicated turbocharging tools, significant annual savings of more than $5 million are expected following the implementation of our global ERP. With our various initiatives, we have all ingredients in place to maintain our global leadership in turbocharging of large engines. Before I conclude, I would like to come back on our key pillars in service, which are the foundation for our resilient recurring revenue streams. First, a large and steadily growing installed base of turbochargers, which is well covered by service agreements. Secondly, we offer full cover service model to our customers with unique and differentiated offerings like Turbo SmartCare, Turbo MarineCare. Third, established long-term relations with our major customers and high customer loyalty, which allows frequent engagement and further growth of service penetration into our own and non-Accelleron installed base. Service after sales after service is and will remain our closed-loop approach. Thank you very much for your kind attention. Now I would like to hand over to Adrian, our CFO, for the financial part. Thank you, Roland. The very warm welcome from my side. Now that you have been introduced to the strategic and operational aspects of our business, we would like to walk you through our historical financials and our financial outlook. As outlined by my colleagues, we are convinced that Accelleron offers a unique and compelling investment proposition based on the following three financial key characteristics. First, sustainable revenue growth, mainly as a result of outgrowing the overall market, further strengthening our leading market position and continuous growth of our recurring service-related revenues. Second, attractive margins. On the back of our revenue growth, the resulting operational leverage, as well as continuous productivity improvements along our value chain. Third, strong cash generation resulting from our disciplined focus on operational excellence and the underlying cash generative nature of our business. In the coming slides, we will elaborate on how our business model and our strategy translates into our financial performance, starting with our historical financials and subsequently moving to our financial outlook. Starting with our historical financial revenues. Our top line had suffered in 2020 across both the medium- and low-speed and the high-speed segments as a result of the COVID-19 pandemic. More specifically, the pandemic and related lockdowns caused significant disruption to several of our end markets, such as the cruise and merchant marine service business within the marine industry, and the gas compression product business within the energy industry. As you can imagine, boats stopped moving all around the world and the turbochargers therefore did not require any maintenance. While these effects were strongest in the middle of 2020, we experienced the first sign of recovery towards the end of the year as most industries started to gain traction again. Overall, the relatively limited extent of revenue decline during the pandemic year highlights Accelleron's resilient and service-driven business model. The recovery continued throughout 2021, and we achieved revenues of $756 million, with most of our end markets registering positive year-on-year momentum. The only larger exception remained the cruise business, which has yet to experience a normalization towards pre-pandemic levels. Notwithstanding the challenges in this particular business, the overall volume in the medium- and low-speed segment improved in 2021. In the high-speed segment, we experienced strong and above pre-pandemic levels of demand in the gas compression business. While power generation also recorded moderate volume growth. Overall, the high speed segment came in at roughly 10% above pre-pandemic levels of 2019. As we move to the profitability of our business, you can see that the development over the last three years followed similar trajectory as the top line evolution. On the one hand, the decline in absolute gross profit and gross margin in 2020 was driven by the lower volumes and under absorption of fixed costs such as manufacturing and service functions. On the other hand, it was also caused by an adverse product mix, namely the large decline in the cruise service business within the marine industry. With the ongoing recovery observed in most industries, as well as due to our swift and comprehensive response in the downturn to achieve a leaner cost base, we were able to bring back our gross margin in 2021 close to pre-pandemic levels with 47%. This swift turnaround was further supported by a better product mix. If we go further down the income statement, the factors I just outlined also impacted operational EBIT, both in absolute and relative terms for 2020, resulting still in a solid margin of 20.5%. Overall, the volume decline could be partially mitigated by the swift implementation of cost measures. In 2021, we managed to deliver an operational EBIT of $188 million, representing a strong margin of 24.8%. If we look at the development on a segmental basis, we made significant progress on the margin side for both segments. While medium & low speed was more heavily exposed to the margin contraction, largely due to the cruise business exposure. In the medium & low speed segment, we achieved an operational EBIT of $138 million, resulting in a margin of 25.1%. In the high speed segment, which has fully recovered with an operational EBIT of $50 million corresponding to a margin of 24.1%, very close to 2019 levels. As we continue to invest in R&D capabilities to elevate our innovation leadership, R&D expenses have slightly grown in U.S. dollar terms in 2021. In respect to SG&A, we are back to pre-pandemic levels in proportion of revenues. Note that while the operational EBIT happens to be our internal profitability metric, it is also a non-GAAP measure. Hence, we have provided the reconciliation of the adjustments between our operational EBIT and U.S. GAAP income from operation in the appendix section of this presentation. Accelleron's highly cash generative business model is one of the key characteristics in terms of financial performance, reflected in a strong free cash flow conversion over net income. In the past three years, we managed to deliver an average conversion of around 100%. If we go into more detail, I would like to draw your attention to two items in particular. Capital expenditure and net working capital. With respect to capital expenditure, the main driver in both 2020 and 2021 were real estate investments in Accelleron's Swiss office facility, which resulted in higher CapEx. We expect to finalize this project this year. Hence, CapEx should begin to normalize from 2023. With respect to the net working capital, we also engaged in a very disciplined management to account for the temporarily negative effects of the pandemic in 2020. These measures released $16 million of cash, contributing to the strong cash flow with a conversion of roughly 113%. Notwithstanding the top and bottom line recovery seen in 2021, we maintained our focus on operational excellence, which resulted in a stable net working capital despite the top line growth of 6%. Now let us go to the trading update reflecting the most recent performance of Accelleron. In the first half of this year, we were able to grow our revenues by 4% year-on-year to $383 million. At constant currency, we realized a growth rate of 11%, driven by the strong demand across most of our industries and supported by favorable pricing dynamics. This growth was supported by roughly similar developments across our two reporting segments. In the medium- and low-speed segment, our revenues increased mainly as a result of the strong service demand in cruise and strong merchant marine demand. In the high-speed segment, the favorable momentum continued and resulted in revenues above pre-pandemic levels, mainly driven by the strong demand from the gas compression business within the energy industry. Looking at our operational EBIT margin, we saw a further improvement in the first half of 2022. We achieved an expansion of roughly 130 basis points compared to the previous year, resulting in a strong operational EBIT margin of 25.3%. This increase was mainly the result of our operating leverage while being additionally supported by a higher share of service revenues in the medium- and low-speed segment. In contrast, the share of product business revenues increased in the high-speed segment, which consequently resulted in a lower operational EBIT margin. Overall, we have been able to offset to a large extent higher transportation cost and raw material inflation by pricing adjustments and continued productivity initiatives. Moving to the cash flow, where the conversion in the first half of the year amounted to roughly 39%, namely due to a larger inventory buildup. As also seen with many other industrial companies in H1 of this year. The buildup was mainly driven by longer conversion cycles due to unplanned lead times or longer lead times within the supply chain, respectively recurrence of missing parts and measures to minimize impacts on our customers. Finally, the capital expenditure increased by roughly $5 million due to investments in the Swiss office facility, while all other items were broadly in line with the previous year. On this slide, we depict our target capital structure. We target a net leverage of roughly 0.7x operational EBITDA at the time of the spin-off from ABB, reflecting Accelleron's commitment to a solid capital structure. This solid basis provides us with the required adequate financial flexibility to further grow our business. As for cash and balance sheet, Accelleron is expected to be equipped with circa $150 million cash in line with the company's business needs. We will be externally financed on a standalone basis. Before diving into our financial outlook, I would like to walk you through our capital allocation framework. Our main priority is to deliver attractive returns to our shareholders. Our policy is to distribute 50%-70% of reported net income as dividends. If our net leverage is below 1x operational EBITDA, we plan to pay up to 100% of reported net income. Of course, for this, we need sustainable growth. My colleagues have led you through our growth initiatives in detail. We are at an exciting moment in the energy transition across our end markets. Based on our continuous investment in R&D, consistent with our historical track record of 7% of revenues, we are very confident that we continue to achieve above market growth driven by our market-leading offerings. We follow a disciplined approach with respect to capital expenditures, aiming to keep it largely in line with depreciation levels, maintaining our asset base up to date as we have in the past. We also envisage to capture further upside potentials via bolt-on complementary acquisitions that may become actionable over the next few years. Here again, we will be disciplined and focused on real strategic fit and value creation. In order to achieve all that, we will need a strong balance sheet, providing us with the financial flexibility to grow our business while continuously returning cash to our shareholders. Before concluding, let us outline some of the details of the spin-off process. As part of the separation from ABB, and in order to build up capabilities and resources that were previously provided by the group, Accelleron will incur certain one-off costs and investments over the next 18 months. These one-off costs and investments mainly relate to the build-up of general functions that will no longer be provided by ABB following the spin-off, such as IT infrastructure, application and services, as well as finance and HR operations. We currently expect to incur approximately $95 million of G&A cost, whereof circa 60% are expected to be expensed in 2022, and the remaining circa 40% in 2023. In terms of one-off capital expenditure, we expect to invest approximately $5-$10 million within 2022. Let me conclude this section by providing some color on our financial outlook. The left column illustrates our expectations in terms of financial performance for the current financial year, 2022, while the right column summarizes our mid-term targets. In the context of the strong market momentum and ongoing recovery, we expect to grow our top line organically by roughly 6% in 2022, which is slightly above our mid-term target range. In terms of profitability, we expect the operational EBITDA margin to come in at around 24%, also reflecting some changes in our recurring cost structure due to our future standalone setup and our listing. Operational net income, which is a metric that will not be part of our recurring guidance in the future, is expected to come in at around $150 million in 2022, underlying Accelleron's strong profitability. Furthermore, we expect free cash flow conversion to be between 60%-70% in 2022, below the mid-term target range, mainly driven by the inventory build-up this year. Finally, we plan to pay our first dividend of around $75 million during the course of H1 next year. To summarize, I would now like to reiterate our mid-term financial targets, which refer to the next four to five years. The 2%-4% revenue growth CAGR reflects healthy and sustainable levels of organic revenue growth. We do not intend to provide detailed guidance per segment. A 23%-26% operational EBITDA margin corridor reflecting the resilience of our business model on the back of solid revenue growth, effective operating leverage through better asset utilization and further productivity improvements along the value chain. 90%-100% free cash flow conversion, which reflects the highly cash generative characteristics of our business, underpinned by the strong operational excellence culture of our team. 0.5x-1.5x net leverage target corridor ensuring a solid capital structure while allowing for enough financial flexibility. Ultimately, allowing for an annual dividend distribution of 50%-70% of reported net income, unless our net leverage is below 1 time operational EBITDA, in which case we intend to pay up to 100% of reported net income. In doing so, we enable our shareholders to participate in our future growth through attractive returns. With that, I'm going to hand over to Daniel, who will go through some of the details of the transaction and present his concluding remarks. Thank you. Thank you. Welcome, Daniel. Now you had the chance to see the management team, and I hope you agree with my opening statement. This team really knows their business. I still have a bit to catch up, but I try to get on the same level. By now, I hope really that you have gotten a comprehensive overview of our products, strategies, competitors, and markets. Before going to the Q&A session, let me conclude the presentation section of this event. Why a spin-off? Every year, Accelleron is expected to generate about $150 million income. Enough for an attractive dividend yield and further reinforcing our already very solid balance sheet of Accelleron. This, again, is the base for ongoing investments in new green and digital technologies, footprint, and inorganic growth. This allows us to continuously add future value. As a midsize company, we will become leaner and more agile, giving our people more empowerment and room for entrepreneurship. In addition, shareholders get direct exposure to a focused turbocharging champion with an attractive investment proposition. A few words about the spin-off transaction itself. It is treated as a 100% dividend in kind. It will be a 1-to-20 split. That means if you wanna have an Accelleron shares, you need at least to have 20 ABB shares. The spin-off is subject to the ABB AGM approval, and the preparation for the spin-off are well advanced. What are the next milestones now? Approval by ABB AGM is scheduled for September seventh. Prospectus is expected to be distributed on September twenty-third, and first trading day of Accelleron shares at SIX is set to be on Monday, October third. For a limited time, there will be some limited touchpoints between ABB and Accelleron's post-spin-off. As you are aware, Accelleron brand has been launched on February fifteenth, including partnership with Sauber Group and its Alfa Romeo Formula One team. Accelleron will use for some time ABB logo on existing products and parts until inventories are consumed and all logos on production tools have been changed to Accelleron. Already prior to the announcement of separating turbocharging, Accelleron has already been operating on a broadly standalone basis, including its global sales force and service network. Accelleron will be a fully independent company. We expect some areas such as IT and HR, some support from ABB until 2023, covered under so-called transition service agreement at arm's lengths. Board of directors, as already shown by Oliver Riemenschneider, will be fully independent from ABB. Now, 102 slides older, let me summarize our value proposition for our shareholders. What should you take away from these 100 slides? Accelleron is a global leader in heavy-duty turbocharging with exciting future prospects as well as best-in-class financial profile. Our competitive strengths are technology, operational excellence, and service delivery. We have a strong position in resilient markets and are in pole position to benefit from the energy transition. Our strategy is to outgrow the markets and our competitors, leveraging our superior products, our technology, as well as the leading market position and our service network, while continuing to deliver best-in-class margin, cash conversion, and capital deployment. We aim to increase market share in our main markets, marine and energy. We want to expand organically and inorganically into adjacent areas where we could differentiate thanks to our technical leadership and service network. We'll continue to grow our service business by increased focus on lifetime service contracts and digital offering. We are looking forward to turbocharging value for all our stakeholders together. Thanks again for joining and listening, and now it's time for Q&A, and I will hand over to Michael. Thank you very much, Daniel. As I said, now it's time to Q&A. I would like to repeat, participants in the room, just raise your hands, and one of our colleagues will come to you with a microphone. The remote participants, as told you before, please use the Q&A tool on the website. Could I ask you, when you're asking a question, please, to tell us your name and which organization you're working for, which would then help us to answer the question. Thank you very much. Is there a question in the room? This one. Good afternoon. Thank you very much for taking my question. Alessandro Foletti from Octavian. I have a couple initially on service. You mentioned a little bit how the market is structured. I was wondering if of these 180,000 turbochargers that you have in the market, if you know the location of all of them, first of all. Second, if you know how many of them you are servicing. Then, as a follow-up, depending on how you answer, what's the plan to grow and grab market share? That will be the first question. I have another one. Good. Thank you. No surprise. I would like to hand over- Okay to you, Roland. Good. Thank you for the question. As in my presentation, I was pointing out a lot to our global sales and service organization, where we have a global footprint close to our customers, close to ports and shipyards, and there we follow up proactively with end users about the installed base. We have, I think, quite a good understanding about the installed base and where vessels and power plants are operated with our equipment. That's the job of our sales and service people to proactively follow up and also in our industry, I think we know each other. There are not that many newcomers, so there is an established, I think, a relationship to a large extent of our customer. Second question was, how we- How we grow. Yeah, exactly. So, and you have also heard from Christoph, we are experiencing less utilization of the equipment. There is slow steaming, and there are cleaner fuels. We have been facing this situation already for quite some time, and nevertheless, we were able to grow our revenue steadily by about 2% per year. Why is this possible? Again, I think we have a close relationship with customers. We know them, and we go into agreements. So we want to have long-term agreements, typically five years, which gives us then, of course, a better understanding of where the location is, can better plan, and gives us also resilience. We want to increase that share. We have currently, I would say roughly about 45% of our global service revenues are backed up with service agreements, which have a term of three to five years typically. I think that allows us to continuously grow, and we want to further expand that part. Good. Over there. Tobias Schulte, UBS. One question. I haven't seen any figures on return on invested capital, so I was wondering how do you perform in this regard? The second question is more a bit related on the dividend policy. The leverage is below the 1 time, but your payout is, for this year at least, seen at the lower end of the 50%-70%. I was wondering a little bit why is it on the lower end exactly at the first year maybe? Yeah, that's it. Thanks. Okay, good. I think would you be okay to take it over? Yes, definitely. Otherwise, I can try. First on the return of capital employed, I think we have a comprehensive guidance framework at hand. We measure the profitability, the net working capital efficiency through the free cash flow conversion, and we have as well a view on the invested capital beside that. I think through these components, we actually cover it. The return on capital employed we will report, but we will not guide. In respect to the second question on the dividend policy, I think there we stated in the presentation if net leverage is below one, we will plan to pay up to 100%. If I correctly understood, you were questioning that mechanism there. Obviously, while always considering as well potential investments into growth. You one here in the front. Fabrizio Cattaneo, Pictet Asset Management. A few questions from me. First, you didn't mention M&A. Maybe you can just rule it out or comment on that, if you have any ambition in this sense. Second question on cost. You are reporting on cost and revenues, currency effect. You're reporting all the figures in dollars like ABB. Maybe you can say a few words qualitative on how cost and revenues are matched globally, maybe on a qualitative statement, whether you have natural hedging in place and to what extent, central cost in Swiss francs have an impact. Then again, on FX, the debt, whether the debt is a $300 million debt or is a Swiss francs debt. I would like to know that too. Third question, and then I will stop here. The dividend, is this a Swiss francs dividend or is a dollar dividend? How this will be paid? Thanks. Okay, thanks for the question. At least the first one is for me. The second one I would like to hand over to you, Adrian. About the M&A. Yep, we definitely wanna have a disciplined approach. What does it mean? Again, I've done some M&A. We have clear idea we wanna be in the power transmission or power propulsion system. What does it mean, discipline? I mean, we are patient. We have some targets we are looking for, but as I said, it's like with marriage, it needs two to tango, and you can force an M&A, but then normally you pay too much. I think with the targets we are looking for, they are small, good in size that you can build up the relationship and find the right time. We don't set any guidance how many M&A, but definitely it's part of the whole strategy. Good. Going over to the next question in terms of currencies, I mean, first and foremost, yes, US dollar is our reporting currency. It is well aligned to one of the key markets, which is the marine industry. From a market angle, US dollar is a match. When we look through the internal dimension, then we have a lot of our revenues, actually our pricing in Swiss franc, and we have a very good match there to the cost base. Additionally, we have euros, Japanese yen, as well as CNY, and we are well diversified along our end markets. Overall, it's pretty close to a natural hedge in that sense. In terms of debt, I think this was a $300 million equivalent in that sense, that will be most likely financed in Swiss franc. That's the current working assumption. Last but not least, for the dividend, I think it's again an equivalent in U.S. dollar, but working assumption would be as well most likely Swiss franc. Mm-hmm. Good. Tobias Schulte, UBS. Add-on question. Technology, can you maybe elaborate a little bit more? What is the technology needs or where are you investing in order to make these jumps in the performance of your product? At the end, it looks from externally nothing really compelling, but as you are above the competitors and you are spending 7%, I think there's something more behind that. I was wondering if you can give some ideas here on what is driving the performance of the product. Good. You can now expect an answer from a CEO, but I prefer to give the chance to our chief technology officer to give a more substantiated response to that one. Thank you, Daniel. With development technologies, you always balance between optimized performance thermodynamics and on the other hand, reliability. For example, designing a turbine, you have blades, and you have to design these blades that you have the best flow characteristics. On the other hand, these blades suffer from vibration during operation, and you have to make them as strong as possible to withstand these vibrations over thousands of hours of operation. Finding this right balance is always the key in optimizing the components. We have established a very well simulation and modeling tools to really deep dive into all fields of flow around these blades to really identify all the areas to improve. This is the key. It looks like a turbine, but it's very efficient inside and make it reliable over thousands of operating hours. Good. Thank you. Okay. I would use the opportunity to ask a question that came in online from Guillermo Peigneux-Lojo from UBS. With the current inflationary energy context, it is clear that investing in a new vessel or equipment or retrofitting an existing one could result in significant savings. As recession fears mount, do you see your end customer industries more hesitant in their decision-making? I would say definitely more uncertainty in the future normally doesn't help for investment. Here I think there are two sides of the coin. One is definitely efficiency and saving money, but as I said, also the regulations are now pushing our customers to become greener. Also because of ESG reporting. We see definitely some customers moving ahead irrespective of the financial, just because it's about reducing CO2, it's part of their ESG strategy, and it's also part of selling. As I said, Maersk is now offering biomethanol. Definitely that's not cheaper, but there are customers who are willing to pay for that. And as I said on the financial, but the outlook is still if you take an LNG ship, I mean, that's not a discussion of recession, whatever. LNG is required in their ship. I think we have to differentiate. There's definitely markets in the merchant marine that have a good outlook and some might get a little bit more under pressure if the recession hits, and then they will take slightly different decision. There's definitely a clear market for upgrades. Mm-hmm. Thomas Funk from GAM. I have a follow-up question actually, to the question of my colleague from UBS before. The question would be: What's really the physical limitation of your technology since you have been developing over 100 years? Is this margin and the values that you are taking of the technology or are there still steps further that you can take in terms of technology? My second question would be, can you talk a little bit about the market shares in your different businesses? Good. You wanna take the technology? Yeah. Please. At the end, first of all, the better computational performance power gives us now the opportunity to really deep dive in all areas. For sure, yes, we are quite close to the, let me say limits, but we are about to extend them, as I showed even with this part of 3D printing. We at the moment on the way to design or to learn how to design these parts, and as I mentioned before, we have just started to print titanium compressors, which are much lighter compared to the aluminum equivalents, which are from standard production. With this, it opens up, let me say, a whole new world of ideas my dear colleagues already have what they can all do, evaluate and explore. For sure, it will take some time because we want to sell reliable products. We at the moment are learning how these printed parts will perform in field and how we can make proper assumption about the lifetime. At the end, yes, we do see a lot of opportunities even to get better next years. On your market share, can you exactly say which segment you would like to get more information? You mean by segment industry, marine, power or whatever? Yes. What you can say by the market, if it's on technology, it's even better, of course. Sepp, probably we can't give you quantitative figures, but it'll be more qualitative, whether slightly higher than average or slow. Can you- Should I? Yeah. On the low and medium speed. In the low and medium speed, I mean, I've shown it in the presentation, it's about 40% and there's only marginal difference than between the various segments. In medium speed it is then more depending if you break it down to engine customers. I mean, it can go up to 100% or 0% when the engine builder has turbocharger designs by himself, and in the low speed it's overall market is very similar. Probably on the high speed, I mean, gas with 80%, that means you have to have everywhere high market share on that one. On the diesel, we are so small, I think it doesn't matter. We have to improve on there anyway. But you want to give a bit more insights on your In our business between a platform and an application. Uh-huh That drives then your market share in a specific area. It depends when the engine builder is further developing their product, then you get a chance to get on, and as qualification, the homologation of such engine is quite the expensive part. They don't just change turbochargers when they don't further develop their engines. As Daniel said, diesel nothing everywhere and gas high market share everywhere. Okay. We'll now just use a short remote question in between from Daniela Costa from Goldman Sachs. What is the split of your marine revenue by ship segment? Excuse me? The split of marine revenue by ship segment. Oh. Okay. You, I guess. I mean, it's about 70% merchant marine, 30% rest, specialized vessels, main propulsion. Within merchant marine it depends very much on, I mean, it within the sub-segments of container, tanker, bulkers, they have the ups and downs but not at the same time. In the end, it equalizes over time. But- The rough split is 70/30. 70 merchant marine, 30% other main propulsion. I guess for us, you know, it doesn't really matter whether it's here or here, as long as the engine is large and they need this big turbocharger we are in. It doesn't really matter. We really don't see a big difference between the different ones. If, for example, now containers are up, they're booming like hell, we are on that one. If the LNGs are coming, we are there as well, and so on and so on. For us, as long as the whole merchant marine is moving, that's good for us. Okay. Thank you. Hello this side. Welcome. Good afternoon. Serge Rotzer, Credit Suisse. If I'm not wrong, you didn't disclose any numbers about order intake or backlog. Do you intend to disclose this in the future? Question number one. In any case, can you give us some flavor about the backlog situation, about the book-to-bill situation you have, about the lead times of the backlog? How have lead times changed compared to pre-pandemic? What do you expect going forward? Okay. First I will try. Mm-hmm. Please correct me if I'm wrong. I mean, in general it's clear there's the lead time is now increasing twofold because definitely we are challenged by the supply chain. We sometimes would like to push out our orders faster than we want, but we are struggling on that one. That's the one, that's why also our order backlog is increasing. Also what we see more and more, because I told you already the shipyards are booked out 2025, 2026, all of our customers are now trying to get the slots to make sure that they are not coming late. They are kind of early ordering already to make sure that they have a slot and they don't have an issue with the turbocharger. These are the two folds. One, as I said, it's the supply chain and the other one is the different customer behavior. You wanna add something, Adrian? Maybe to the order intake at constant currency, it's clearly above revenue. Uh Supporting what Daniel says. Yeah. One voluntary, because customer behavior, and the other one not really voluntary, by chance than by choice. As I said, supply chain. Yes, Gael Foletti again. On the R&D, you are now at 7%. Is this a target that will remain? Which was- Is there reasons why it was? Yeah, R&D the 7%. High? R&D 7%. Yeah, as I said, normally over the cycle, we are investing our $50 million and or the 7%. In the end, it's not fixed, carved in stone. It still needs to make sense. You see, we have a large portfolio. If you have a good idea, we will invest. If you have not so good ideas, we'll invest less. All in all, it's clear we wanna have a competitive portfolio, and we have to have a good mix of new products and old products. This is an investment not for today and tomorrow, for tomorrow, for after tomorrow, and that's why it's important that we keep the investments. All right. If I understand you properly, mid to medium high single digit in% of sales- Yeah, so- is a ballpark figure. Again, no guidance. No, no, that's fine. If you keep the $50 million in mind, that's good. Okay, more on the absolute number. Okay, fine. On the M&A, you mentioned specifically to somebody else's question that you target small companies. Is this by design or is because there are no larger companies around, or you're just not interested in purchasing bigger chunks? It's not easy to understand, sorry. All right. Excuse me. Do you understand, do you hear better? Yeah. On the M&A side, you mentioned that you're rather going to target smaller companies. Is it because there are no big ones or because by design you do not want to approach bigger chunks? Yeah. There's different one. I mean, definitely, as I said, the smaller one, I mean, smaller one doesn't mean it's only $5-$10 million, can also be $50 million revenues or whatever. These are normally better digestible, and, as I said, normally you can get better deals when you jump for the big ones where everybody's going for it. Also they have to make sense. I mean, we have a balance sheet, which is solid, but we don't wanna put everything in one basket, so we wanna have good ones. Again, if there's an excellent one and a bigger one, I might need to talk to the chairman and ask whether that's fine and, we can increase. Mm The capital. We wanna finance it from the cash flow we do every year and make sure that we are reasonable with this acquisition. Thank you. One last one, if I may, on technology, and I don't know who wants to answer this one. Can you explain me if there are major technological differences in how the turbochargers are built, whether they go on a diesel-propelled motor or they go on a gas-propelled motor, or if they go on a H2 propelled or NH3 propelled or whatever? Are there differences there? Maybe if you can explain a little bit what they are. You wanna do that or? Probably. Let's start with the components. This is how we are organized. In terms of components, we are quite well looking on high pressure ratios, high efficiency, and high volume flow. What these components then are taken from my colleagues from the product business groups, and then they make their special products. They have special turbochargers out of them. Maybe I'll hand over to Christoph. Yeah. I would say if we look on fossil-based fuels, we always had to compromise between performance and reliability because these fuels are quite dirty, and they tend to harm the turbocharger. Moving into gas and synthetic fuels, we will focus a lot more on overall turbocharging performance, and as a consequence then, better engine efficiency. Because they are clean by definition. I mean, no one makes a synthetic fuel dirty. That makes no sense. No difference between CH2, H2, and H3. There will be differences, but then most likely more in the internal part that determines the performance. Mm-hmm. Our engine builders, they prefer then to have one, let's say, connecting dimension, one type of turbocharger, because they want to simplify their platform as well. We will then do the tuning with different components inside compressor and turbine. We call them trims. Yeah Trim the turbocharger for the customer needs. An ammonia and a hydrogen engine will definitely need different turbocharger specifications. This is no doubt. Good. Yeah, finally. Hi. Johannes Borner from Santro Invest. I have a question on the cost side, and maybe more specifically with respect to the inflationary environment we're in, and here more specifically on the backlog. How is there the ability to make price adjustments on your backlog, on orders you have currently? That's the first question, particularly on the material side. Second one is more on the service side. We're servicing the tool pools you have in place. Do you have a price adjustment clause with respect to labor costs that might go up? How does that work? Then the last question, if I may, is on service. As a service, if I may say, if you could give us a little bit the feeling where you stand. Is that the very high demand, so that you say you paid for uptime? How much of your service portfolio is already paid like this, and how quickly will that develop? Mm-hmm. Thank you very much. Okay. First of all, on the pricing side, on the long-term service contract, normally we have price escalation clauses in place to protect us from cost increases, but also for the customer it's a fair one. If costs go down, also his price will go down, so that nobody's having advantage or disadvantage of price adjustments. On the transactional business here, you have to understand that normally our throughput time is three to four months. That means, when we take orders, normally we adjust or consider already the costs. Mm-hmm The higher costs. There's some special thing because sometimes we have long-term contracts with our customer, a kind of frame contract on pricing. There we sometimes have a time mismatch. As already said, in the second half we might be a little bit hit because we will be able to pass on, but not everything on time. All in all, I would say, under control on our side. One question was about, on your side, I think. Yeah ... about the- Time the uptime contract. Yeah. Go on. We have another question was on the labor price. Mm-hmm. There we regularly review in every country, in every location, the labor price, and, of course, there is a market price, and we will definitely be in the high end, but we need to have a competitive labor rate. That's where we're reviewing currently. As you can assume, we have also made some adjustments, especially in the last 1 1/2 years. Mm-hmm. We get that pretty much through. Another question was on the service agreements, I understand. To what extent do we have for the service agreements? About 45% of our total service revenues are with service agreements, and thereof, about one-third, I would say 15%-20% of our global service revenues are based on structured service agreement, where there's a commitment for a contractual period of time. Probably one thing what we see customer understand when we wanna increase the price, it's not really a fight. It's a negotiation like normal, but also we see our customers passing on their price increase or cost increases through prices. In the whole industry, it's a common understanding that prices need to be adjusted because costs are going up. Clearly we don't take advantage of overcharging our customers because we have close relationship with our customer, and as I said, we don't wanna take advantage on that one. What is also clear, the part, structured service agreement, we wanna grow that one. We wanna clearly grow because these are structured agreements, binding agreements, where we deliver exactly what you have asked for, an uptime, a certain availability, which is then priced in our offering. Okay. This service on the very right of the slide you have. Yeah. It's really advanced. That's exact. How much of it? Is that already 45% or 1/3 of it? No, that's 15%. It's 15%. That's 15%. Okay. Right. Thank you. Right. That's good. Okay. Right. Okay. I would say that's really industry benchmark. Yeah. Mm-hmm. Yeah. Our competitors have normally not such kind of agreement. They might have at best frame agreement. Mm-hmm. Good. Angelika Gruber from Tamedia. I'm wondering, how fast do you think can that go, and when will it be the industry standard for big container ships? Or in other words, what do you think, what will be the proportion of your turbochargers running on diesel still in 2050? Thank you. Okay. That's the famous crystal ball. Look, again, I mean, in the end technology's here. It's all about giving the political framework. It's about building wind tower and PV. When we see how big the discussion is just to build one additional wind tower, there needs to be a change. Again, we are ready. The shipping industry will be ready by end of this decade to get all the engine. The challenge will be because now ships that are today ordered and built, they will last for 20 or 30 years. This customer will not order now an engine running on methanol, knowing in two years the ship is here and there's no methanol. The challenge is now this famous, when do we have the fuel ready that we can also order those ships? What we see now customers doing dual fuel. Mm. They have one still a traditional fuel, let's say diesel, and they make them already a kind of ready for future fuels. But what does it mean? I mean, some items they don't know yet the technology, but for example, just to make sure that there's enough space in the ship that you can store two different fuels and so on. This flexibility or this option, we see more and more customer ordering that they wanna have that they don't have a ship purchased for $100 million and it's stranded assets in 10 years because the regulation will change. I'm sorry, that's a bit the question. Will it come fast? I hope it'll come fast, but again, we need much more renewable power that we can produce all these synthetic fuels, otherwise, it's a dream. Okay. I'll add one more question from the remote participants, William Mackie from Kepler Cheuvreux, on the revenue guidance, and I probably directly look at Adrian. You guide for 6% growth in full year 2022, but report 11% in the first half year. Why do you expect growth to return close to zero in the second half year? First important to understand, in H1 2021 we had a rather low comparable. That's due to the 11%, and then in terms of what do we expect in H2, roughly 1%-2% year-on-year growth. Mm-hmm. Mm-hmm. That's the situation. Okay. One question up front. Thank you. Stefan Zoller from Zoller Capital. Just a few housekeeping questions. Navy exposure, that is probably a question that you're gonna hear at some stage. How big is that? And the second part is, are you planning to also report services separately at some stage? And the third, I think there was a misunderstanding before, are you gonna report order intake and order backlog, or you're not gonna report it on a quarterly basis? I- Mm. I think, we will definitely report orders and order backlog. Mm-hmm. Just as I said, reporting but not giving guidance on that one. We give guidance on revenues. Then the other question was the first one. Navy. Navy. Navy. Navy exposure. On Navy. Military, you mean. You wanna? Yeah, I can. I mean we have 70% in marine, 70% merchant marine, 30% other main propulsion, and within this 30% it's also navy, but it's a low single-digit percentage point. Maybe to the service that usually we disclose in the actual numbers, the proportion, right? We do not guide as well on it. Yeah. All in all, what we said is service is quite resilient. I mean, even in down terms you might have ±5%. If you take a look on the ratio, it's mainly driven by the product business, which we'll see bigger swings, ±10%. It's more driven by the new business, whether in an upcycle, then we might have more or less revenues, but not on service, not because we have lower revenues in service, just because the product business is going up. It's clear in the down cycle then we might see less or more revenues from service as a proportion. Mm-hmm. Okay. One more question from Danny van Doosburg from APG. Mm-hmm. Given the high share in gas energy, how is the relation and the share of wallet with leaders like GE, Siemens, Mitsubishi, as they may have their own turbochargers business here? As they have what? They might have their own turbocharger business here. Okay. I think in the gas market, how are we related? Okay to companies like GE, Siemens and Mitsubishi there? Okay. They don't have their own turbocharger, but here probably I think the person means about gas turbines against combustion engine. Yes. Again, our portion is a small one, the 5% of the whole combustion engine, and we are not really in competition against the large gas turbine. They have a different task in the network. They are more or less running base. I mean, these are engines, 300, 400, 5 MW. If you have a combined cycle, you almost have a nuclear power plant of 1 GW. We are really the one that try to stabilize the small, let's say intraday you have a peak or whatever, they jump in or as a backup of a data center. A data center probably has 10 MW or 50 MW. There you don't need a 300 MW as a backup. Mm-hmm. We are really not competing against the big gas turbines. We are probably competing at the very small gas turbine, and there's, I would say, knowing both businesses, that's the flavor of the day. Some prefer more the small gas turbine, some have more combustion. Gas turbines are a bit more sensitive, while internal combustion engines are really more the workhorse here. We are not competing against the GEs, the Siemens and the Mitsubishis in that field. Okay. Another question from John Leclerc from LVO Global Asset Management. Is it fair to assume that approximately 100% of the group operational EBIT is generated by the service? I think we do provide guidance in respect to the overall group, the margin itself. We do know, yes, service is more profitable, but specific guidance there we said no, right. Again, we manage, that's why we report in these two segments. We don't report in product business and service business because you have to consider the product business and service business in one integral part. We manage the life cycle of those products. As I mentioned, we invest at the beginning in development. We make money with product business and with service business. It's clear if there's large service business and you can benefit, then we might be more aggressive on the pricing. If you go for high speed where you sometimes see like backup, where you don't see really service business because those turbochargers are there to wait and they might never be used or for five hours a year. Yeah, definitely we wanna make money on the pro-product business. In the end we wanna make the money, the 25% you have seen over the life cycle. Whether it's at the beginning or at the end, this is secondary as long as we make the money over the life cycle of the products. Another question from Remo Rosenau. On service from 2000 to 2022, you increased your service location from 75 to 109, which represents a growth of 1.7% per annum. Looking forward, would you expect a stronger global growth in terms of location? We are continuously reviewing our global footprint. If we see market opportunities, if we have customer needs, we will set up a service station or we may also decide to go out of a certain market because maybe the power plant is no longer in operation. That's a continuous process that we regularly review. At this point in time, I'm not in a position to make a statement, and I think we will see if there are business opportunities, we will open up, and if not, then we will remain unchanged. I think we need to be competitive. We need to be close to our customers and the install base, and I think that what drives the number of locations. Okay. I agree with you. I mean, in the end, I would be careful to correlate the number of service center with revenues we make in service because it can be that we gain market share on marine and we have all the service center already set up so then we don't need to increase. You- Let's say there's now more small power unit somewhere in Middle America, and we don't have a service center, we wanted to cover it. Again, no direct correlation. It depends where our turbochargers are sitting. Okay. Now in respect of time, there's room for one more question, and I would then just take it from here. Daniela Costa from Goldman Sachs: What is electricity as a percentage of your cost? How does the current energy crisis impact your business and suppliers? Excuse me. How does the current energy crisis impact your business and suppliers in terms of electricity cost? Good. I mean, we see definitely on the freight cost, they're also going up because the energy prices are going up. So far, I would say besides that one, the electricity prices are under control. Definitely now, we have now, especially in Europe, prices are going through the roof and we'll see what kind of contracts we can close with utilities here and we are in negotiation, and that's definitely a little bit a challenge we have to see. Unfortunately, we don't have the crystal ball because today prices are, I think, 10 times higher than normal. Is that now going on for the next two years or not? Now we have some decision to take. Good. Thank you very much to all presenters for your presentations and the questions. Thank you very much to the remote participants. We will now give certain instructions to the participants in Baden, but the video stream will end soon. Thank you very much. Thank you very much for your presence, your participation, your questions, and your interest in Accelleron. Yes, we are looking forward to having you with us on the Accelleron journey. Mm. Thank you very much. Goodbye and a good afternoon. Thank you. Mm.