I guess you can see my screen now. Welcome to AQ Group earnings call for the quarter three, 2021. I'm happy that so many of you are interested in our progress and what we do. I will try to go through this agenda. Here with me in this room is Christina Hegg, who is our CFO. Hello. This is the agenda for today. First, I will go through AQ Group quick facts. I think most of you who are in this call know us already, I will just go through it. It will be very quick. We'll go through third quarter in brief, first nine months in brief, with some comments to the bullets, some highlights and lowlights that we see in the quarter. They are also stated in the report, we maybe paint a little bit broader picture. We go through some numbers, on-time delivery, a little bit about market segment development, and then we take your questions. Okay. Quick facts. We are 6,000 employees. We have roughly EUR 500 million turnover. We are seven business areas, and we serve more than 15 market segments with production, manufacturing in 16 countries. We deliver globally. We have shown profit every quarter for the past 27 years. For the last 10 years, we have had an earnings per share growth of roughly 16% on average. We do two to four acquisitions a year, and we're part of the UN Global Compact since 2012. Let's move on to what happened in this quarter. I think it was very evident if you have read the report, which I assume you have, that we are working hard to get materials and components like almost everyone else in the industry, especially in our business areas, in the system product segment, electrical cabinet business area, and the wire harness business area. Net sales increased with 18% in the quarter compared to last year. It is well above our goal, which is 15% growth annually. However, looking at the corresponding quarter in 2020, we had COVID, and it is not really good to compare to. We are not really happy with this growth, even though it succeeded our normal goals that we have. Operating profit decreased by 3.5% to SEK 94 million compared to SEK 97 million. It is a big disappointment. I will broaden that a little bit later. Our profit margin, EBT, was 6.9%, which is well below our goal of 8%. We're not happy with this performance. I will move on to the next one. If you look at the 9 months, January to September, net sales increased by 11%. Compared to COVID year, it's not what we expected. We expect to see higher growth numbers. The orders are there, but we are not able to deliver out. Our operating profit increased by 20.6%. Here I say again, 15% growth. We want to be 8% EBT and then grow 15% per year. This corresponds to that, but again, we're not happy with the performance that we have seen now in Q3. EBT goal we are above if we look in the 9 months, but we should have been able to be even better, as I've said before. We have this equity ratio with the goal over 40%, and that is now 55%, which is well above our target. We want to be more active with our M&A team to maybe decrease this a little bit. If we go to highlights in the quarter, there are not so many, but we have very strong demand. We have very stable customers that want to buy everything we can produce. It is a good situation to be in. The worst situation we could be in is that we don't have any orders, so we must be happy with our order situation and that customer want to use our knowledge and expertise and buy product from us. I want to highlight also this new order from a truck manufacturer that we got, which is really a breakthrough for us with this customer in this market business area. We will do cable harnesses for the cabin of this truck, and it will go into series production in 2023. We have not been delivering to this customer in this type of product. We have delivered wire harnesses to them before, but now we really expand our presence there. This is really organic growth for real. Unfortunately, this volume will not show until 2023, and it is not huge. It's SEK 135 million annually from 2023, but for four years. Still, it's really nice volume to get in also since we are building a new factory in Lithuania. This will of course fill that up a bit more. The integration of the Schaffner companies is going according to plan, I believe. We have no serious hiccups, really. Those factories are able to deliver to their customers in a good pace. I also can mention that India, we have really nice growth in India, in the railway sector, especially in all our market segments or business areas. Both sheet metal, electrical cabinets, inductive components, meaning transformers and inductors, and also in the wire harness segment. There we see a nice steady growth of both of our Indian subsidiaries, and they are growing with profits. It's a very nice situation to be in. We have been developing these two businesses for more than 10 years from greenfield, so it is nice to see that bear fruit finally. Lowlights in the quarter. Our EBT margin, as I've said, is too low, and as we state in the report, we see that price increases for raw material, we have a lag, so our price increases come three to six months later when the prices for raw material go up. This affects somewhat the EBT margin in the quarter. The biggest effect is still that we have a lot of orders that we're supposed to deliver out, we're not able to because we're missing one, two, three components for that particular order. You have maybe if you look at an electrical cabinets, it can be 500 different item numbers in one, then you miss two or one, cannot deliver out, increases the inventory, also it impacts the total turnover and hence the EBT margin. I think also cash flow is rather poor in the quarter since we are not really. It looks like we're growing, yes, versus the same quarter last year, if you look at the quarter two, we're actually not growing our top line. To have this kind of cash flow is not good enough. Again, it's affected by the same example like I talked about in the EBT margin that we see that we cannot deliver out everything that we should or want to deliver out and that our customer want to have. Then component supply, we write it a lot in the report, and here it comes again. It's really, really tough out there now, especially in certain areas. I would say in the wiring business area, we have a huge problem to find connectors, mainly for different customers and their products. Also in the electrical cabinet field, there it's this semiconductor shortage because in these low voltage components, there is a lot of semiconductors. There we have delays from the likes of Siemens, Allen-Bradley, Rockwell, ABB, Schneider, everybody is delivering late. We are trying, of course, to suggest alternatives to our customers. Also now the alternatives are starting to be in low supply. It is becoming more and more difficult, I would say. We have this delay in transferring raw material prices to customers that, of course, affects the EBT margin. Here, I must be a bit critical that we can be and should be more proactive when it comes to this. We have solved some things during the quarter that I am happy about. They will have effect first in the fourth quarter. We need to monitor this and work harder on it. I do not feel that this is a lack of pricing power. It is just that we have been a little bit slow to be critical. Mexico is still a lowlight in the quarter. We have huge demand increase in Mexico, we don't have the management to take care of that demand increase. We need to support them a lot from our European subsidiaries in order to deliver to our customers. It's a big challenge for our team over there, and we try to train them, and we recruit new people, and we add competencies and we support them from Europe. It's a huge challenge. We're basically growing with four of our big accounts in Europe, but for deliveries in Mexico and the U.S. It's a big challenge over there. We believe we will be successful. We know how to produce the products in an efficient way. We need to transfer that knowledge. The acquired company's sales volume. Here I'm specifically talking about the Chinese Schaffner subsidiary that we bought. They have lower sales volume than what we expected in the transaction, and it, of course, affect disappointment but there are some projects that are delayed, railway projects, and it is driven, of course, by the Chinese government. Earnings per share growth. Here I've made a graph that I showed in some investor presentations before, but basically it shows our earnings per share, the blue ones per year. I've added now a rolling 12 there for 2021. That means that if we have the same profitability as we had quarter four 2020, we will have around SEK 20 per share, earnings per share in 2021. That would mean a 20% growth compared to 2020. Of course, if we look at our targets that are specifically 15% top-line growth with a stable margin of 8%, that should normally give a 15% earnings per share growth. This is a little bit above our target. It's not that bad, but of course, we cannot continue like we've done in quarter three with the poor EBT margin. We're working hard to get back to the similar picture as we saw in quarter one and quarter two. Net sales per quarter, I think this is a good growth because it really shows that even though the numbers look like we're growing the top line, we're not really. We're basically back to where we were in 2019. We can say also that 2019 normally is a little bit slower quarter for us. We still are disappointed in the development, and I would have liked to see that the quarter three bar was higher than the quarter two. We're working hard to really get back on track and find components and work together with our customers to solve those component issues that we have. Organic growth, I think this is also a good graph. We have a target of 5% organic growth per year. If we mirror the quarter two 2020 and quarter three 2020 versus quarter two 2021 and quarter three 2021, they are almost identical, which means we basically have gotten back the volume that we had a little bit more, but basically it's just back to status quo. We have a certain growth, but since we have difficulties delivering out products, we don't really see enough growth. Yeah, again, it's the same explanation as before. If you look at growth, I think it's a nicer picture because we have been basically not doing anything for four quarters, during COVID, now in quarter three, we are back with some acquired growth. Of course, our target is 10%, we're not really there yet. Yeah, we have some more work to do. We have our list of companies that we are looking at and we are visiting, unfortunately, or fortunately, here I should say, since you're an investor, we are very picky with what we buy. We do really thorough due diligence, we do it ourself because we know this type of business better than anyone else, we believe. We're really picky, we say no to a lot of things. It is still a challenge to find cases, but I'm confident that we will continue like we have done in the past to buy a number of factories every year, between two and four factories. This year we have added actually three factories then. In number of factories, we are there, but turnover-wise, we need to do a little bit more. If we talk about EBT margin, this is how I'd like to explain it. Normally in AQ, we have been between six, very seldom been over 10, but in quarter one, we were very close. On average, we should be around 8%. This doesn't mean that I'm happy with the quarter three performance because it is also a negative trend that we don't like, and we're doing everything we can to reverse that trend. We should deliver around 8% EBT margin on a long-term note every quarter. That is our target, and I believe that it's definitely possible to succeed. If you look at cash flow, I mentioned in the lowlights, the majority is that we are unable to deliver the goods out. Of course, we are also a little bit impacted that when we have this kind of supply situation, when we find material, we of course try to stock up a little bit. We have a certain amount of increased inventory that is, we can say it's related to this component shortage, but it's not directly related as the other part where we just cannot deliver out, and we have semi-finished goods or parts that we didn't start because we don't have all the material. It is impacted, but I believe that in a normal situation, our cash flow should be roughly the same as our profit on EBT level. Okay. Normally we show this net debt. It has increased a little bit based on the Schaffner acquisition, where we actually buy a lot of assets and we get a little bit of goodwill as well, but it increases the net debt a little bit. We're in a very safe level, so to speak, but I think this gives us ammunition, of course, to do more acquisitions when we find the right companies. I want to mention this one. It's very uncommon for companies to show this graph, but I can tell you that all industrials that you invest in, they have this kind of information. This is our delivery performance in AQ. We measure it every month for every single company that we have. It is measured versus our committed delivery date, if you are on time, early or late. This one shows everything that is early, delivered too early or delivered too late. I can say this is unfortunately an all-time low for us of 90%, at least since I started in AQ, and that is many years ago. Of course, it's not a nice picture to show, but one in 10 of our orders is delayed, and I think that can represent how much we are lacking in delivery, really. I think it's a telling graph, really. We are normally very good at acting quickly and adapting to current demand situation in order to have this at a quite high level. It is an extremely challenging situation now with components. We're fighting hard. We're not giving up, for sure. When it comes to market segment development, I mentioned it in the report, basically, would say all market segments are back in full swing, and many of them actually want to buy more than pre-COVID, but they cannot because we cannot find components, but they're also limited by other suppliers. The only thing that's really not completely back are buses. That's easy for you to see also, just look in any other bus company report. Buses are definitely not back. Railways are still, in many cases, postponed, not completely back, but both of them, we start to see that they are coming back again. You can imagine that it will be a swing upwards when you've had basically one year of COVID with no bus orders at all. The buses that you have in your fleet, they wear out, so then you have to buy more than you normally do. We believe at least that it will be a big swing upwards in those market segments coming forward. The third one that is not back either is the marine segment. We see a very high activity on the RFQ front that we get a lot of requests for quotations. We deliver mostly transformers, but also electrical automation for the marine segment. We believe that it will come back sometime during 2022 and be fully back in 2023. Then again, it's very hard to look into the future. That is the picture we see now at least. That was basically what I had in presentation-wise. Now we go into the question segment. I will see if I can bring this one back up again. I will try to unmute you. Can you unmute yourself, or do I have to do it? We can unmute. That's great. I see a question from you, Juan. Yes. Can you just talk about looking at your competition. Yes Would you say that you're sort of a preferred taker of sub-suppliers' goods, or are you at a disadvantage compared to your competitors? You talk about this home sourcing trend, et cetera. I guess that would be positive for AQ. If you just look on a broader perspective, I'm basically trying to get at if you're risking market shares here because it's going to take a couple of years probably to rebuild this whole supply chain to increase capacity. I don't believe that we are losing market share. I think in this kind of market, it's the one who works the hardest and screams the most to get the most components. I can take a concrete example. One of our big suppliers for all automotive OEMs big suppliers for connectors is TE Connectivity. They were called Tyco in the past. They are the biggest supplier in the world for connectors for automotive industry, and they also produce wire harnesses themselves. We also produce wire harnesses for them, and they are the worst to get their own connectors, which is a very strange situation because if I own the connector production, then I would think that I would be able to give them to my own production, but they are not able to because their customers are screaming. They have Volkswagen and the others screaming at them to really get components. Then they give it to them before they even give their own production. We see clearly that when we work hard and really have a loud voice, we also get the components. I don't think that we are really in a disadvantage. We also, of course, use our customers and work together with them towards these suppliers to really get components in for their specific product. I don't think we're at a disadvantage, really. I wouldn't say so. No, I think it's about working really hard in the supply chain. Okay. Got you. You talked about a lot of things that you were discontent with in the quarter, but how is the organization responding when you make clear, James, that these are not acceptable, poor performance, et cetera? What is the likelihood of you actually getting this fixed in the coming quarters? I would say that I think the organization is responding in a good way. Of course, we have a lot of people. Of course, there are good and maybe not as good people, but I think the organization is, to be really honest, they are working extremely hard just to deliver out the amount we have been delivering out now. I think that they are doing their utmost, and I know a lot of our people are working more than maybe they should, but not because we force them, just that they are really committed to delivering to their customers. I think that we are committed to really fix the supply chain issues that we have, or I would say most of the people that are in our business have. It's different in different segments. If I take for my business area, sheet metal, for example, there is material. Both sheet metal, aluminum, and copper, you can find it. It's just that the prices have gone up. There we don't have disturbances in that sense. There we just have to push the prices to our end customers, and I think we've been successful doing it in this quarter, but it will take effect from next quarter. For these component businesses where we have a lot of components and our delivery is quite complex and big, there we are really hit by the lack of. I don't know if I answered your question, but I tried. Makes sense. Sindre, if you unmute, you can go ahead. Yes. Hi, James. Hey. Just a question on, you are obviously not completely satisfied with your profit performance, but looking at one way is to, when you read the report, it says that Schaffner contributes negatively with the SEK 3 million and also the SEK 99 million top line. If you subtract that, you get from 7% to 7.8% EBIT margin. At least that brings some comfort to, let's say, the underlying picture. In order for that to valid, that assumes that you will improve the profitability in Schaffner. You explaining that some part of the Schaffner is performing quite well, but especially China is a problem there. How do you see the, let's say, turnaround of Schaffner and particularly the Chinese operations? Is that a kind of easy fix or is it a situation you have to solve over several years? What should I say there? We have a clear plan, I think. To be honest, it's not only China there either. We need to do some restructuring in this German sales and technology office as well. We have a clear plan for Schaffner, and we knew the profitability level when we bought it, and we knew we had to do things to get up to our level. We are a little bit surprised by the low top line in China, which of course also affects that. We have a plan on what to do with it. As I can say that we have already another transformer factory also in China, and there are opportunities where we can consolidate some business between those two and make that together a nice unit. We have a plan, and I don't believe that it will take several years. That is way too slow. Okay. Can we say that your ambition is to be, let's say, break even on the Schaffner operations already in Q4? We don't do forward-looking statements, but of course our target is that it should make EBIT 8% as fast as possible. That is what we normally do. If we look back in history, what we buy, we very seldom buy companies that lose money, but normally we buy companies that are not so profitable because we get them really cheap, and then we improve the margins, which gives us a very nice leverage versus the purchase price. That is what we will try to do also in this case. Okay, thanks. My second and final question is regarding Mexico. You alluded to that previously, it was also stated as a kind of issue in the Q2 report. You also said that management was part of the problem there. Are you seeing it improving or is it due to the, let's say, logistical and component issues that things have gotten worse? No, to say that it has gotten worse is maybe not right. We're just not finished. We need to take a number of steps still in this company. As I said, we are giving them a lot of support from within our business area. We have units who have the same customers in Europe that we have in Mexico, and I strongly believe that we will be able to sort this out. At the same time here, we are seeing quite a good growth in that unit, which complicates things, because it's easier to fix it when they are sort of unstable than when they are growing. It is a challenge for sure, but this is what we do, so I'm sure we will fix it. Okay. If I may have one more question. You're delivering to, let's say, world-class or big firms with lot of resources. Are there any risks on, let's say, getting penalties or cancellations or that you have to pay compensations to the customers? I would say that there is always risk in all business. I wouldn't say that it is bigger now than it normally is for us. Also, we try to have back-to-back agreements with our suppliers. In this case, I would say in the general case here, if we get penalties, we can transfer it to our suppliers. That is what, of course, we try to do, because it's not our fault that our suppliers changed their delivery time and that they don't have enough capacity. We try to, in a way, act in the same way as our customers in this regard. We are not, so to speak, Mr. Nice Guy in this, and we bear the costs for a meltdown in the supply chain globally. I can say that we will do what it takes. Historically, we have not had any big penalties, and we have been doing this same type of business for 27 years or so. I say there is a risk, but I wouldn't say that, based on history at least, we haven't been hit in a big way. Okay. You don't seem that worried. Okay. Thank you. We have Matthias de Wit with a question. Yes. Hi. Thank you for taking the time. Just on the supply chain issues, do you have any visibility on when you expect them to be resolved? Is it months, quarters, perhaps longer? I would say no. It's very hard to get visibility, I would say. It's not only one thing. It's not one component or one supplier. It is so many different suppliers that are struggling to deliver. If I knew the answer to that, then I would become a very rich man, I guess. I think it's very hard for anybody to say when this semiconductor shortage will end. I don't know. Yeah. No, I understand. Yeah. Just to get an idea, if things turn to normal, what sort of revenue would you be able to do on a quarterly basis based on current demand and capacity? Hmm. Yeah. Can you share anything on book-to-bill or to get a flavor of what is? I think that this on-time delivery chart should show a little bit the flavor, I would say. Yeah, exactly. If you think that one out of 10 orders are delayed, that is 10% delays. Then you look at our turnover, and then you can do the math, I think. I think capacity-wise, in some of the factories, it can actually deliver more if we would have, in a fantasy scenario, an infinite supply of components. I think that is a realistic number to say that it could have been 10% more in this quarter. No, that's very clear. Just maybe a last question on the. You provided sort of insight into the different end markets. Have you ever provided your turnover profits by specific end markets? Have you ever provided that breakdown? I just mainly wonder how exposed you are to high growth markets, like energy transition, like storage, EV, renewables, as opposed to more mature markets. I was a bit surprised because some of your peers, like NOTE, they managed to grow at a very high rate, and they have quite high exposure to these type of clients and segments. I just wonder how different you were compared to them in that respect. They do a lot of electronics and I would say different type of product. In general, they do a little bit box build, but very small boxes compared to ours. If I would say like this, they are into a lot of these EV chargers for personal vehicles, which is high volume stuff. We are more into high voltage EV chargers. To get a comparison, I think there is a higher complexity and a different product mix, meaning we have more low volume, high mix than what they have. Which if I should try to answer your first question there with how exposed we are to this sort of electrical vehicle, new energy, these kind of markets, it is very difficult for me to give a number because if I am delivering to, for example, big customer like AB Volvo, it is a big account for me. We deliver to their buses, to their trucks, to their construction equipment machines, and also to Penta. They are also transitioning towards electrical, of course, we are delivering to those vehicles as well. Of course, I would assume that you mean that they are a traditional one, we are part of the development of their electrical bus, we have many components and systems in those buses and have had for many years. I would say we are into that, I think that transition is also slower than on the commercial side, more than the business side. Certain of our business areas are very linked. If we talk about these inductive components where we made the Schaffner acquisition, all the products that are produced there goes to some sort of electrical transformation. It is everything from water-cooled inductors and transformers for wind power and solar power to driving electrical motors of different sorts in different drives. That I would say is all into a good new space. Even if it's very old technology in a way, transformers have been part of the business for a very long time. In fact, if we look at pure renewables, normally we would say we are at 4% of the total turnover. As I mentioned in the report, we have a number of projects with both startups and experienced players for energy storage. We are talking about also bigger type of energy storage plants more than small batteries. Here we are doing like it's part of our electrical cabinet business area, our sheet metal business area, and our inductive components business area. They're all involved. We have some project orders that are known also, I think, to the stock market with Azelio who are doing this aluminum heat storage, you can say, with the Stirling motor to make electricity. It's a very different type of battery. There we are their main supplier. We're building the whole system for them. They have not gotten so much orders, I believe, as they have planned, but still, we have a number of orders there that we are working on and delivering. Then we have some other very experienced, I can say, customer within backup power solutions for factories and cities where you need to have backup power where we are doing a big project now for their battery plants, so to speak. They have some kind of battery module which weighs 15 tons, and we are building it for them in Bulgaria. We believe that this will grow. Very long reply to maybe a short question, yeah. No, a very good color. Thanks a lot. That's it from me. Thanks. Someone here want to come in? Okay, we have Sindre, you're raising your hand, but I guess you maybe didn't take it down, right? Yes, I tried to take it down, so no questions for me. Okay. Do we have any more questions? Okay. You have also our contact information and feel free to also give me and Christina feedback on this call because it was actually my first earnings call. If you like to see something else or you think that I have too much Swedish accent in my English, then please feel free to comment. Our email is available on the website. Also if you have other questions regarding the third quarter. Then we will have another call again after the year-end report. We will have two calls a year. That is our plan at least. Feel free to get in touch if you want more information. Okay. Thanks everybody. Thank you. Have a good day. Yes. Bye.