In our busy daily life when stressing to work and being in back-to-back meetings, we seldom stop and reflect about our health. We take that for granted. Well, last year, over 80 million people were forced to reflect on their health as they received the message, "You got cancer." We at Elekta want these patients to feel that they are not alone in their fight. Our legacy in fighting cancer started almost 50 years ago, and great innovation has taken us where we are today, the largest independent radiotherapy company globally. Good afternoon, everyone, and warm welcome to Elekta's Capital Markets Day 2021. My name is Cecilia Ketels, and I will guide you to today's event. Also, warm welcome to Gustaf Salford, our President and CEO. Thank you, Cecilia. It's truly great to be here again in a sunny Stockholm to have a Capital Markets Day, even though if it's digital this time. That's true. We have an exciting agenda. In brief, what are the themes? Yes. I will kick off with discussing a bit on the market trends and how cancer is evolving as well. Also discussing precision radiation medicine's role in cancer care, and then highlight some key drivers and growth drivers going forward. The most essential, largest part of the agenda, right? Yes, of course. It's our strategy that we will announce today, Access 2025. I will kick off describing some strategic initiatives and strategic pillars, and then members of the Elekta management team and representatives from around the organization will describe different parts of it. My colleague, Maurits Wolleswinkel, will discuss the innovation agenda going forward. We will have Lionel Hadjadjeba and Thijs van Bommel describing the Unity journey. We have Paul Bergström describing and talking about the service business, and then Habib Nehme will describe our opportunities in emerging markets. Finally, Johan Adebäck, our CFO, will link the strategy to our financial outlook. At the end, we of course also want to have a Q&A session. Of course. Please, those are listening and want to ask questions, use the telephone number that you received upon registration. Gustaf, before we jump into the market dynamics, can you please give us an introduction of Elekta as of today? Absolutely. Happy to do so, Cecilia. I just want to give a brief introduction to Elekta, we are truly a global organization with a global business, we are continuously growing. If you look at Elekta, we are headquartered here in Stockholm, Sweden. We have around 4,500 employees around the world, we also have offices in more than 40 countries and growing. Our solutions are treating more than 2 million cancer patients every year, and it's installed in more than 7,000 hospitals around the world. We're actually selling our products to more than 120 countries, so truly global business. We keep growing. We have now annual sales of around SEK 14 billion, and our installed base is now up to 4,750 Linear Accelerators, Gamma Knifes, and MR-Linacs Unities around the world. This has actually doubled since the last 10 years. How we are organized, how we drive Elekta forward is really about our business lines and also our regions. If you look at how we report the regions externally, it's three different regions. It's Americas, EMEA, and Asia-Pacific. You can see the revenue split is fairly well-distributed between the three different regions, in a third each. You have our business lines, the leading dimension in the organization with clear profit and loss accountability that we introduced a couple of years ago. You have the Oncology informatics solutions, really software-focused. You have our largest business line, the Linac Solutions business line, and then you have the fastest-growing business lines, of course, the MR-Linac Unity, Brachy Solutions, and newer solutions. We have clear number one positions on the market. Across these business lines and regions, we have a global service business servicing all our customers and the installed base. It could also be interesting to look a bit differently on the split of our revenues. If you look at emerging markets versus mature markets, Elekta has a strong footprint in emerging markets, 30%, and mature, 70%. Software versus non-software, we have 25% of software business across the different business lines, and non-software is around 75%. As you've heard me saying many times, we have a recurring business, our service business, around 40% of the overall Elekta revenue. Our solutions or our devices is more around the 60%. What are we all about? What is the purpose of this organization to do? It's really about cancer, oncology. Cancer impacts all of us, it is personal. I think many of you have been impacted and many of your relatives and friends. One in five people will actually develop cancer throughout their lifetime. It's also about that people live longer with cancer, and the five-year survival rate has actually gone from 50%- 70% over the last decades. It's also growing. Cancer is actually growing twice as fast than most other diseases, and it's likely to become the leading cause of death globally in the next decades. How Elekta is working with this and our purpose is really to give hope for everyone dealing with cancer. How we do this is really about improving the lives of patients around the world with cancer, and we work together with our customers, but also with our partners. That's a key part of how Elekta has been successful throughout the years. Our vision is really about a world where everyone has access to the best cancer care. All of this must, of course, be delivered in a sustainable way. More than a year ago, we changed management team in North America. Let us now hear our Head of North and South America, Larry Biscotti, talk about the change, the success, as well as the development in the U.S. market. Hello, my name is Larry Biscotti, and I'm Elekta's Executive Vice President and Head of North and South America. Today, I will share some highlights of the U.S. business and the improvements we have made since I assumed this role 12 months ago. As a company, we have a history of investing in innovative technologies that drive shorter, more precise courses of treatment with developments like Gamma Knife and MR-Linac. As such, in our largest market, the U.S., our product portfolio is uniquely positioned to support customers as they look to increase efficiency and reduce the number of treatment fractions. Over the past 10 years, the average number of fractions per patient in the U.S. has decreased from 22 to 16. We fully expect this trend to continue based on several market conditions. In the U.S., the reimbursement model is expected to change from a fee-for-service model to payment of treatment per cancer type. Due to this upcoming alternative payment model, the U.S. market is highly focused on value-based care. The alternative payment model is likely to drive that number of fractions per patient further down. We also expect the U.S. installed base to remain stable as we expect a 10% rise in both cancer incidences and prevalence over the next five years, as well as seeing a wider array of cancer cases treated with cost-effective radiotherapy. The U.S. has the largest installed base of LINACs, both in absolute numbers and per capita. Today, we see that 84% of LINAC purchases are planned with stereotactic capabilities to reduce treatment fractions. Additionally, given the highly competitive nature of the U.S. market, differentiating technologies are also in demand, such as real-time imaging and adaptive radiotherapy. As such, our investment in MR-Linac with Elekta Unity has differentiated our portfolio in the market and opened doors to new clients. During the last 12 months, we have grown our orders volume, installed base, and share in the U.S. market. I believe this is also a direct result of organizational improvements and new commercial strategies. First, we've implemented what we refer to as the zone community structure to build an agile and more intimate customer-facing organization. It's a full geographic alignment between all customer-facing functions such as sales, service, training, contracting, and accounts receivable into five zones, so that the local teams can quickly make decisions and better serve each zone's customer base. Second, we have focused on strengthening the internal culture in the U.S. Based on Elekta's values, we've added some specific cultural pillars to energize the team and build the foundation for success in our zone communities. These pillars permeate our organization at every level and have led to some of the highest employee satisfaction scores in U.S. history at Elekta. Third, we've initiated new models for sales channels and market segmentation strategies. We've specifically targeted some of our largest, most significant customers based on two areas, service and software, where we have assembled dedicated sales teams and a renewed commercial focus. We view services and expansion of services as a significant growth opportunity, focusing both on existing and new product offerings. We're additionally heavily focused on oncology informatics solutions, which is our largest installed base and an area of the portfolio that will continue to strengthen in years to come. Lastly, we have ambitious plans and continued focus on strategic accounts, large group purchasing organizations, niche segments, and other consolidators in the U.S. market. All these commercial actions continue to strengthen our position and visibility to the overall radiation oncology market in the U.S. We will continue to improve Elekta's competitive edge in a market that needs an innovative, flexible, and responsive provider. Given the recent changes in the competitive landscape, we are the largest full-portfolio independent company focused on radiotherapy and have a great opportunity to better serve our customers in a fast, intimate way. As you can tell, I'm very optimistic for Elekta's outlook and future in the U.S. market. Our product offerings, commercial structure, and culture of positivity have better positioned Elekta to consistently grow our business in the U.S. Thank you for your time. Sounds good to hear. Larry talked about value-based care and more cancer type being treated with radiation therapy. All important trends driving Elekta's industry. Well, Gustaf, in reflecting on the market dynamic, let's take the patient's perspective first. You said previously that people live longer and that the survival rate has increased. How does this development look like? If you've seen, as I mentioned before, over the last couple of decades, it's been an amazing trend that improvements in cancer care have resulted in longer life expectancy, and people live also longer with cancer. You can see on the picture here in the back that the cancer survival rates has gone from 50% up to 70%. You have certain cancer types like breast or prostate or skin that is now over 90%, and we expect this to continue. At the same time, the picture is very mixed. If you look at the cancer types like pancreas or lung or liver, the survival rates are much lower. I think the key thing here is improving operational efficiency when you think about cancers like breast and prostate, so more people get access to it and new innovations in that area to further give accessibility to cancer patients around the world. If you look at the cancer types that is with lower survival rates, it's really about improving the clinical outcome. I think Elekta Unity, the MR-Linac, is a key trend here and a key differentiator that will help patients going forward. Yeah. That's really an encouraging trend for the cancer patients around the globe. How are you thinking when it comes to the access of radiation therapy in the different parts of the world? Yeah. If we take the more regional perspective or country perspective, it's also a very mixed picture because you will have countries with good accessibility to LINACs. You can see on this picture that countries like the U.S. or Japan or Western Europe, they're often more than four LINACs per million of population. At the same time, for the rest of the 85% of the world's population, it is really limited accessibility to cancer care, but also for radiation therapy. The trends here are a bit different as well. I think for the more mature countries with a larger installed base, it's really about improving the clinical efficiency with better innovations, but also local proximity. Because you can take a region like Europe, there's big variations in accessibility in quite a mature region as well. If you think about the 85% of the world's population, it's truly about developing the infrastructure and also improve availability across those regions, and some countries today actually do not have access to radiation therapy at all. That's really tough. How large is the gap, then? Yeah. If we quantify these two pictures, we see a gap of around 15,000 linear accelerators around the world. I often say that every second cancer patient should receive radiation therapy, and actually part of 40% of the curative treatments, but that access is not there today. That's what we are really focusing on and supporting our customers and their patients to close this gap. What do we at Elekta do to improve their access around the globe? We do a lot of things. Of course, it's through innovation. We develop products that is a good fit with closing this gap, and I think Harmony is a great example around that. It's also about supporting customers with customer finance, helping to get to the right reimbursement levels around the world, and also about education and training is actually one of the biggest issues there is in many markets, that we need to help our customers to be trained in radiation therapy procedures and processes. It's important to say, if you think about the full cancer care budgets around the world, radiation therapy is actually only 5%-7%, and I believe that should increase going forward. I see. What are the key drivers going forward as you see it? I think key drivers for me, I try to summarize it here in four key drivers, I mentioned improved infrastructure and radiation therapy access around the world. It's also about the growing cancer burden, that this gap, if we don't do anything about it, will just widen. It's about continued adoption of cost-efficient and value-based care. You heard Larry Biscotti talking about a couple of these trends in the very mature markets, the U.S., with the alternative payment model. We've also seen during COVID that radiation therapy has been used in a more surgical way in parts of Europe like the U.K. as well, reducing the number of hospital visits for cancer patients. Breakthrough technology advancements. I think something Elekta always has been standing for. It's our legacy and what we drive forward. I think you have examples of Unity, you have examples of Harmony, and we have lots of examples around our software portfolio. We cannot do this alone, and I think cancer care is truly a team sport. Market collaboration throughout the cancer care ecosystem is increasingly important as well. If we reflect on this market trend and try to qualify them quantify them. Yes. How would that look like? Yeah. We worked hard to quantify these trends and looking forward what we expect from a healthcare expenditure, GDP development, and so on. The RT market in totality is above $7 billion. The growth rates going forward, what we have in our midterm outlook, is 6%-8% of CAGR until 2024, 2025. We expect emerging markets to grow 8%-10% and more of the mature markets more around a 2%-4%. Software has been shown during COVID, but also going forward, we expect to be a key growth driver at 7%-9%. The solutions or devices more around the 5%-7%. Great. That was the update on the market trend. I know that you want to present our new strategy that you and the management team has developed. Absolutely. Thank you. Really happy and proud today to present our new strategy, Access 2025. It's something Elekta and the management team has been working on throughout the spring here, and it's really linked to our vision towards a world where everyone has access to the best cancer care. If you think what do we mean about what does access to the best cancer care mean for Elekta, it's really about three things. We say it's availability of care, and we've set the very ambitious future milestone in 2025 that 300 million people should get access to radiation therapy through Elekta solutions with 802,000 additional Elekta LINACs in underserved markets. We also see elevation of care. Elevation of care for Elekta means that we should double the clinical usage of short-course treatment or hypofractionation, and we should quadruple the adaptive treatments among Elekta's customer. The third trend is really about participation in care. It's about the patient's journey. 20% of Elekta's customers' patients are actively interacting with their own care journey, and today it's only 1%. Kaiku, our new offering, will have a key role to play here. Our strategy and how we built it up is really linked to a world where everyone has access to the best cancer care. The first pillar, of course, is around innovation. It's the key thing that Elekta always have stand for, and we also link it to the customer utilization in mind. That's a vital part of our strategy and how we develop our innovations, always in partnership. We've also seen the need for partnerships and partner integration increase across the cancer care continuum. It's key also to be the customer lifetime companion, and our service offering and our installed base is absolutely vital. Linear accelerators are often out in installed base for 10, 15, maybe sometimes 20 years. We are truly our customer's companion throughout this journey. Lastly, drive adoption across the globe. We have this gap of more than 15,000 LINACs that we work hard, the whole of Elekta, to close every day. Who are doing it? It's, of course, our people. Our people are absolutely vital and crucial for us to deliver on this strategy of more than 4,500 employees. We're also shown throughout the pandemic that we've initiated a lot of resilience and process excellence activities around the organization, making us coming out from COVID as a stronger company. All of this needs to, of course, be delivered in a sustainable way. All of our strategy is linked to sustainability initiatives. If you take the sustainability lens on our strategy, it's really the flip side of the same coin. Strategy is linked to sustainability. We need to have the long-term growth from our strategy, but it needs to be delivered in a sustainable way. It's about the ESG targets, environmental, social, and governance. If we start with the environmental targets, Elekta has just signed up for science-based targets to cut our CO2 emissions in half until 2030. We are also supporting green procurement and circular business models across our business lines and regions. On the social side, we will initiate the sustainability-linked bond after the summer, linked to our target or a milestone that more than 300 million people in underserved markets should get access to our products. We are building diversified teams and addressing the human capital challenge in our different markets. Of course, as the foundation for everything we do is the governance aspect. It's about ensuring a market free from bribery and corruption, and also safeguard a culture of high business ethics and integrity. How will we launch this? How will we operationalize and implement our strategy? I think it's good to start in last year anyway, where we had a year of adjusting to the new normal. It was about launches. We launched Harmony, we launched software across our business lines and portfolio, and we booked the 100 Unity order here in Q4. Today, we announced a deepened strategic partnership with Philips. We strengthened our direct sales network in many countries and regions, and we also drove a lot of resilience and digitalization efforts across our organization. What's next? We look into the midterm perspective, the midterm outlook, it's really about profitable growth, but it needs to be delivered in a sustainable way. We will drive our initiative around our new software platform. We will accelerate our journey with adaptive technology with Unity in the lead. We're also deepening existing and form new partnerships. We will expand our services offering, and we'll also further optimize our sales network, establishing direct presence in key growth markets, and we'll drive operational leverage throughout our P&L. All of this needs to be delivered and support what we signed up to, the Science-Based Target, until 2030. We look ahead, if we take the long-term perspective, it's really to continue, as I think Elekta always have been doing, driving paradigm shifts. It's about developing next-generation treatment workflows and customer engagement models to improve patient access to the best cancer care. Today, this morning, I'm really excited to say that we announced a strategic partnership, a comprehensive partnership, from innovation to distribution between Elekta and Philips. We share the view about precision, the precision in oncology. We are two companies, we share one vision. If you break this vision down a bit, we focus on three key areas. It's about the breadth and depth of our solutions together. It's really about end-to-end cancer care continuum and coverage our best-in-class solutions, both from the Elekta side and the Philips side. It's also about personalized therapy. I think that's a key word, because we need to streamline the workflows and also have the adaptive treatments to really, truly personalize cancer treatment with precision radiation medicine. It's also about informatics. It's about integrated informatics. Historically and today, in all our discussions that's been ongoing now for almost more than six months, we share a view on open architecture and vendor-agnostic solutions. I think it's amazing that we today launched this partnership, and it's built upon our Unity partnership, of course, but also expanded into new areas. Maurits will talk more about it in a coming session here. Thank you. We just heard Gustaf emphasizing the acceleration of our innovation. Let's do a deep dive into this segment and talk to the person who is driving these projects. First, look at this. I'd like to welcome Maurits Wolleswinkel, our Chief Product Officer and also the head of the business line, Linac Solutions. To start off with, when we talk about product segment, we split it into two segments. Can you start by stressing the difference between these two and why it's important to keep in mind? Thank you, Cecilia. Absolutely. I love to do that. Two distinct segments, comprehensive oncology care solutions on one hand, and the RT treatment solutions on the other hand. Starting here, what characterizes this segment? It stresses beyond radiation therapy. That's important to mention there as well, and really looks at the entire cancer care journey. The second element related to this is that you see a much higher level of customer configuration. You see new emerging applications in that space, like the patient-reported outcome, patient engagement in general, clinical decision support, and all these new capabilities and needs also offer the potential for more professional services. That's this side of the segment. The other segment you could say is a more traditional device segment. Device with a much more stronger role of software moving forward. We see our treatment management software as part of these devices becoming much more integrated, and the interplay between the devices and the software becoming more and more important moving forward. Yeah. Before we go to the future, which of course, everybody's waiting for, can you please reflect on the past year? Absolutely. I have to say, this is something that really fills me with pride because it was not an easy year. A lot of us have been working from our home office, also our engineers, they had to innovate from home. That's a new experience. What really fills me with pride is that we've been able to introduce a number of new solutions across the entire portfolio over the past year. We introduced them a little bit differently in a fully digital way, but not less successful, I would say. Let me mention a few. Gamma Knife Lightning, a new solution for the Gamma Knife to really accelerate the treatment and makes planning simpler. We also introduced a brand new Monaco release. Monaco release that is really packed with a number of new clinical capabilities, as well as workflow advancements. We introduced Elekta Studio, an integrated suite of imaging and brachytherapy that we also launched this year. Of course, Harmony, the new LINAC that we brought to the market, and finally, a brand new MOSAIQ release. All in all, this shows also the resilience of Elekta as a company. Great. Can you now lead us through how the Access 2025 will transfer to innovation? Happy to do that. Essentially, I go back to the two segments in the market, it really drills down to three focus areas. Let me go through them one by one. The first one is really about personalized precision. Personalized precision in the RT treatment solution space means something different. It's really about integration of imaging and the adoption of adaptive treatment. We really believe that we are at the brink of a new wave of innovation and adoption of novel new workflows in radiation therapy. On the other hand, we see the role of combination therapies emerging, the need for clinical decision support, but also the role of the patient evolving. Personalized precision is the first one. The second one is really about elevated productivity. Again, elevated productivity means different things in different spaces. What they have in common, that software plays an increasing important role in how we manage productivity by streamlining workflow, by smarter capacity management, but also by bringing mobility of care to our customers as well. The third one is maybe the most important one because it really ties all the spaces together. It's what we call integrated informatics. Integrated informatics derives from the fact that in cancer care, we have an enormous amount of data being generated by the devices, but also by the supported software. What we believe is by basically unlocking that information and turn that into novel applications, we actually can accelerate precision and productivity on the other hand. That's why it's also important that Elekta as a company, continues to aim to play in both spaces because it's so important to connect them together. This is not only a story around the future, a future strategy, a future direction, but we are already bringing that to life in today's solutions. Let me give you a few examples. The first one is the Elekta Harmony. The Elekta Harmony was actually innovated and developed with a very simple aim in mind. How can we improve the productivity by 25%? As a result, we have completely redesigned the in-room workflow. Harmony is doing very well. It's CE approved. We expect FDA 510(k) any moment. We are currently sold in 11 countries already. We have treated the first patient. We also think that actually Harmony will contribute to further improve the profitability of the LINAC segment. Another point to maybe stress as well, that Harmony actually is addressing two market segments. We have the Harmony in the value segment, but we have another Harmony Pro configuration version that is addressing the performance segment. It's really a very important introduction for us at Elekta. Let me give you a second example. An example in the evolving what we call the treatment management software. I said we just launched a new version of Monaco, that's a very large, substantial release. It contains a number of new things. The product, by the way, is MDR released, it's FDA released as well, cleared. We're really ready to sell the product. One of the things that is in Monaco 6 is that we bring back proton therapy planning through our collaboration with IBA back in treatment planning, and we're extremely pleased by that. Proton therapy planning is an area that we believe is important still. We want to support our customers. We started our strategic collaboration a couple of years ago, and now we see it coming to life in this product. Monaco also contains a number of workflow improvements. In this case, it is GenesisCare, one of our largest partners and customers at Elekta, that are also one of the first adopters of Monaco 6, and they're extremely pleased in how Monaco 6 is helping them increase their workflow and productivity, and they are currently expanding the rollout of Monaco across their network. That's the TPS side of things. Now, we're also moving in new areas when we talk about treatment management software. Another product that we are having very much related is what we call ProKnow. ProKnow is a cloud-based review application where analytics are completely integrated to continuously elevate care. Recently we closed an agreement with the Department of Veterans Affairs in the U.S. to adopt ProKnow across their entire network. All their treatment plans will be uploaded into ProKnow and used as a basis to continuously improve their care. We see the role of ProKnow evolving, and we see more and more a stronger interplay between ProKnow on one hand, and Monaco to a blended set of treatment management applications. This fall, for example, we will introduce one of the first artificial intelligence-based auto-contouring applications on this platform. The third example I wanted to give is MOSAIQ Plaza, I like to stress here the word Plaza. Why did we come up with this concept of MOSAIQ Plaza, introduced around two years ago? It really relates to this notion of integrated informatics, where we have more and more partners and new applications sort of hooking onto that same core called MOSAIQ. That's why we call it MOSAIQ Plaza. To give you two examples in this respect, SmartClinic, a new application that Elekta brought to market very successfully, simplifies workflows, efficiency, brings mobility of care also to the user. You can use it everywhere. We're very successful with it. We have almost 150 orders, 50 clinical sites live, and more recently we added Kaiku Health, a patient-reported outcome tool, also to the Plaza. Just two examples in that space as well. The next part of the journey is what? Where are we going moving forward? My simple word is acceleration. Acceleration is that's what we're after. How? By partnering, by new software platform, by also simply investing more money. Let me explain that in a little bit more detail. If we take these three focus areas around precision, productivity, and integration, these three elements, we are really focusing on the three things I just mentioned. The first one is really about the digital software transformation that is already ongoing. One key point to mention that is that digital transformation is not only about future-proofing our software, but also to bring new capabilities to our customers and new services as well. The second one is around strategic partnerships, and we have a lot to announce, of course, today. Strategic partnerships while staying agile and customer-focused in the meantime. We believe that these strategic partnerships are essential for our future as well, to have access to certain capabilities we don't have, but also to team up in larger, comprehensive commercial relationships. The third element is about capability expansion, investing in more people and capabilities. One point to take out there as well, that we specifically will focus on artificial intelligence and really are going to and are in the process of doubling our efforts there. As a consequence, yes, we will increase our innovation spend moving forward. Let me go through these topics one by one in a little bit more detail, starting by the digital software transformation. Then it's important that we first take a step back. Where I already started my first introduction as well, that the role of informatics is changing, and it's good to mention that as well. The traditional role of an OIS, that's how MOSAIQ as a product started, is really changing and expanding. We see more need for multidisciplinary decisions, clinical productivity tools, patients will more actively interact, and the mobility of care, being able to work anywhere, anytime. That's more on the OIS space that we need to enable with this new platform. We look at the treatment solutions, on the other hand, we see other trends. A trend of closer integration of treatment management software with the device, for a good reason. First of all, the role of imaging has become so important moving forward that image guidance is essentially standard, we see. Secondly, we see also a continued involvement of real-time motion management. Currently, really spearheaded by Unity, we see that trickling down in all our treatment solutions. The third element is the emergence of adaptive radiotherapy. Adaptive radiotherapy basically means that you continuously change the plan based on the anatomy at that moment of the time. Finally, what we see also more and more, that software becomes smarter and can really unleash all the capabilities of the hardware by deeper integration and interoperability. We took these sort of future-oriented needs into mind when thinking about the new software platform that we're currently building. We defined three core aims for this platform. To innovate faster. Secondly, that we create a smoother and more unified user experience across our solution. Thirdly, that we streamline our workflows. That is very important to also support the increased productivity that all our customers are asking for. What are we doing? We have already established a central platform organization. We are pretty far down the road. We now start to build the first applications on top of that software platform. Just to give you an indication, today, around 20% of our engineering base is already working on this new software. In the next couple of years, we will further expand our engineering base with over 25%, mainly in software. Let's talk about partnership and strategic partnership. Of course, today we have a big announcement to share with everyone. That's our partnership with Philips. I'd like to stress here as well that this relationship and what we agreed and announced today is very comprehensive in nature. We've been working for eight months behind the scenes to really work through a number of things and closed a number of agreements with each other. Now today, finally, we are ready to announce the partnership. It's really ranging from commercial to joint innovation. Here I'd like to mention one specific commercial arrangement is that MOSAIQ Plaza, that I already talked about, will be expanded with three products from the Philips portfolio. Elekta will be the distributor for that product. Tumor board orchestration, genetic tumor board, and oncology pathway software. I said it's a very comprehensive agreement that we announced today. What I would like to do now is to drill down a little bit deeper on the innovation side of that. There are essentially four areas where we will extend and deepen our relationship. The first one is basically extending what we already have in place, expanding our collaboration on magnetic resonance radiation therapy. The second thing, what we are working on is what we call an integrated simulation planning treatment workflow. Both companies, Elekta and Philips, recognize that the days of an independent treatment planning systems maybe will be over in a decade from now. We're going to team up and work together to really build this world-class simulation planning treatment workflow together. Thirdly, we will further expand of integrated imaging and image-guided capabilities. Yes, we are already working on Unity, but we see capabilities in other modalities as well. Finally, clinical decision support. We will distribute the products we have today, but we also see joint opportunities to deepen, integrate the software products with each other, and develop new opportunities along the way. My final part was about AI and the elevated investments we are doing, and really, we have a clear vision of where we want to go. AI is really enabling a number of things in our field, whether it's helping to enable adaptive radiotherapy, smarter resource management, automation of non-clinical tasks, or clinical operational insight. We see a lot of opportunities moving forward. We also announced this week a close collaboration with the NKI, the Vrije Universiteit Amsterdam, Elekta and the Dutch government called POP-AART. Partnership for Online Personalized AI-enabled Adaptive Radiation Therapy. It's just one of the example of how we are accelerating our efforts in AI. A lot of investment also happening on the infrastructure side, working with partners on the technology, but also to access specific end-to-end data sets to really apply AI to it. All in all, a very comprehensive activity. Maurits, it sounds like plenty of exciting initiatives to shape the future innovation. Before we leave this subject, can you please highlight the effect these initiatives will have on our product portfolio? Absolutely, Cecilia. I said it's all about acceleration, but how does the acceleration translate to our products? That's the question. I make it very simple, just starting with the first slide almost. LINAC, it's really about bringing new LINAC systems to the market, new LINAC systems including adaptive workflows. For MR-Linac, it's really about further expansion of real-time capabilities. That's what we see over there. For the Gamma Knife, it's about efficiency and also bringing in AI and automation to it. Brachy will continue to expand its image-guided capabilities. Finally, the informatics business line will continue to work on these new applications that are added to the Plaza for patient engagement, workflow management, and clinical decision support. All in all, very important to stress at the end, is being supported by a joint software foundation to streamline workflow automation and productivity. Excitement. Thank you very much, Maurits. It's great to hear about the next part of Elekta's innovation journey. Another innovation has been on the market since 2018 is our Unity. Driving a paradigm shift has many dimensions. That's why we put up an organization around this product. In just a minute, you will meet the head of this business line, Lionel Hadjadjeba, and his colleague, Thijs van Bommel, who is the head of MR-Linac marketing and sales. First, let's listen to what some of our customers have to say about Unity. [Presentation] It's inspiring to hear those enthusiastic customers talking about Unity. With MR-Linac, for the first time in history, we actually see what we treat. I'm extremely happy to update you on this successful journey together with Dr. Lionel Hadjadjeba. Thank you, Thijs. At our last capital market day back in 2018, we celebrated the CE certification as well as Elekta Unity going clinical. Since then, a lot has happened. We're now in the second phase of our commercialization. While we usually do not disclose the number of Elekta Unity sold, the contract number 100 was signed in April with St George's Hospital in Christchurch, New Zealand back in April. This is really a great celebration we have here, and this global footprint is clearly showing the worldwide confidence and capabilities of the Elekta Unity system. In the Americas region, we sold over 30 systems, so this region is very important in the MR-guided radiotherapy message. Also in Europe, we see a footprint in all major countries. In China, after receiving regulatory approval in the second half of 2020, we have already sold 10 systems. The market adoption in Asia-Pacific and in Japan is also taking off. Despite COVID, we've sold 20 systems in this region of the world. This is really a great geographical expansion in such a short period of time. Let's talk about how Unity is used nowadays. Of course. We've treated over 40 clinical indications, and this really helps us in understanding the clinical value of the Unity system. On one hand, we are bringing down the number of treatment sessions per patient, which we call hypofractionation or ultra-hypofractionation, for instance, used with prostate. On the other hand, we are addressing the difficult-to-treat cancers like liver and pancreas, for instance. One specific indication I'd like to mention is the oligometastatic treatments. Due to cancer recurrence, this indication is rapidly increasing, and our consortium has done a phenomenal job in using the Unity system for this clinical indication. This is highly impactful. To date, we have more than 500 clinical abstracts and over 350 peer-reviewed articles. The consortium and MOMENTUM form the powerful infrastructure for this clinical evidence journey we have with Unity. Over 50 consortium sites and more than 600 researchers are working on a day-to-day basis to unleash the potential of the system. As a matter of fact, those very good clinical results are the foundations of our planning for reimbursement specific to MR-guided radiation therapy. The first step was to get access to all major markets, which has been achieved. We are focusing now on pancreas, liver, prostate, and oligometastasis, as you mentioned. The plan is to ensure that we will file for reimbursement in the major countries and regions, namely the USA, China, Japan, as well as Europe. We plan to file our first reimbursement submission already this year. We also have a fully dedicated health technology assessment/reimbursement team at Elekta to ensure that we roll out our plans according to our strategic planning. It's really good to hear that we are working on that reimbursement because we know it's crucial for the success of Elekta Unity. On the other hand, we also work on proceeding the technological developments of the system. When we initially designed Elekta Unity, we distinguished ourselves in the market by taking a very detailed look at the choices we have made from the beginning and to assure that this is a future-proof concept. We combined a high-quality LINAC together with a high-quality imaging device, the MRI, without any interference between the LINAC and the MRI. Design, technically, no compromises were made. This is very important to provide our caregivers with the best diagnostic image quality to enable them to target the tumor and to save the healthy tissue by real-time visualization. This platform also enables us to do further workflow optimizations. For instance, the high-quality auto-contouring module, which will significantly reduce the treatment time per patient. Also the high image quality will enable us to automatically respond to motion. The first step here is to automatically switch off the beam, which we would call automatic gating. The unique design allows Elekta to take the next step, which is following the tumor real-time with the beam. This will significantly change radiotherapy practice. Another unique feature I'd like to mention is the tumor response assessment. This is really to look per patient if the tumor responds to the radiotherapy treatment. This is the ultimate form of personalized radiotherapy treatment. As an oncologist myself, I find those prospects amazing and also very exciting. While we work with our customers, our partners, to push out the boundaries, medical and technical boundaries, we as a company are also working on improving our margins. I will give you a few example. The first one is installation. We reduced our installation time by 65% since the first commercial installation. Reducing installation time means also less bunker time blocked for the customers, but also for us, much less installation cost. We also are reducing our cost of goods sold, the famous COGS, and we have a plan to further reduce them over the next few years. If you add all those together with the fact that we have 100% attachment rate of service, and service is a very good margin business for us, and you multiply by the number of Unity that we're going to be selling in the near future, our future is bright. That's really nice to hear and important to hear. Can you also tell a little bit more about the install base we have today? Yeah, sure, Thijs. We have today registered in most major countries. We have also installed over 40 system, of which 26 are clinically treating patients. Many centers are ramping up to treat over 10 patients a day with five fractions or less. That means that the patient will only come five times or less compared to regular LINAC treatment time, which require patient to come up to 35, even 40 times. So a lot of time saved for the patients. One of our customers is leading a study called the HERMES study, which is a prostate cancer study, and they will compare five fractions versus two fractions, which is an amazing m ove towards better quality of life for a patient. Impressive to hear, in other words, this is really a paradigm shift in radiotherapy. As I mentioned in the beginning, we really see what we treat, we are able to act on the motion. This is also confirmed by recent market analysis. We've taken a detailed look at the clinical indications that could benefit from Unity treatments, we've taken a realistic approach where we see that 12%-15% of all cancer incidences would benefit from MR-Linac treatments, that translates to 25%-30% of all radiotherapy treatments. This really confirms the huge potential of Unity MR-Linac. Indeed, Thijs. Let me conclude. MR-Linac is a real paradigm shift in radiation therapy. Join us in the seeing is believing revolution with Unity. Thank you. Thank you, Thijs and Lionel, for this update. You heard them briefly talking about the benefits of the MR-Linac. Let us now connect to one of our customers, Dr. Arjun Sahgal at the Sunnybrook Health Sciences Centre in Toronto and get a deeper understanding of his view on this benefit. Dr. Sahgal will be in a discussion with John Christodouleas, who is sharing his time between being an oncologist in Philadelphia and working for Elekta as the Head of Medical Affairs. Over to you, John. Thank you, Cecilia. My name is John Christodouleas. I am one of the radiation oncologists in Elekta's medical affairs team. I am here today with Dr. Arjun Sahgal from Sunnybrook at the University of Toronto in Canada. Thank you, Dr. Sahgal, for your time. Thank you very much, John. We are here to talk a little bit about MR-guided radiation therapy and Unity. The first question that I'd like to ask you, Dr. Sahgal, is how do you explain to your patients the value or the benefits of online adaptive therapy, and in particular, online adaptive with onboard MRI? Really, the way that I explain to patients is that for the first time, we're basically opening our eyes. In the past, we'd get an MRI and three months later, so you'd have radiation, say, for six weeks, then you have a month off, and by three months later, it's your next MRI or your next image. Patients ask me, "Oh, how's treatment going?" I can say, "Well, you're doing pretty good." Now I can tell you exactly how it's going every single day. Before we even delve into the benefits of adaption and understanding the radiation map, just the mere fact that they're getting feedback in real-time about their tumor makes patients want to go on that unit. Let me ask you, many radiotherapy departments have MR simulators in the department, and of course, most hospitals in the West will have access to diagnostic MRIs. Do you think that the benefits of seeing what you treat could be replicated by sending patients to the diagnostic radiology department? Yeah. That's a great question, and it's again one that comes up very often. I can tell you after having done it, first of all, we're not going to be able to send a patient every week to diagnostic imaging for a full-blown MRI, and nor should you. You don't need the whole battery of MR images on a weekly basis, forget daily basis. Even if you said, once weekly, you can't do it. A. It's not appropriate medical resource allocation. It's expensive to the system, and I don't need all that information. What I need is that snapshot every day to verify the tumor, make sure I'm hitting it, and make changes as I want to. That's why it cannot be replaced by the simple understanding of, oh, I could just put them on MRI simulator or send them to diagnostic imaging if something changes clinically. First of all, how would you even know with a cone beam CT? I think that paradigm changes dramatically once you start using it. Once you start using it, you're not going to go back. The evolution was 2D, so X-rays, to 3D based on bone anatomy only, to now seeing the tumor. We're following that trajectory as the technology improves, and we're never going to go back. Once you start seeing the tumor, you're never going to go back to a place where it's CT bone-based matching. Yeah. I think that's a very powerful way of describing it through the history of radiotherapy in terms of its imaging, the natural progression in here. Of course, we don't go backwards in that progression. Once you start to see, it's hard to go back, like you said. Absolutely. Even for us in uncertain, it was very intuitive to us because we use MR all the time as opposed to some other indications or anatomic organs. Now that you've been able to do it and see it, even those non-believers that said, "Oh, we could do it at CT. We see it enough," now they're actually asking for it because they want to see it. It's the same thing. You're delivering better care, you're doing more for your patient, and you're getting to where we need to be. I'll tell you in a relatively controversial statement that we are getting towards a more surgical specialty, especially with hypofractionation or stereotactic body radiotherapy. The word ablative gets used a lot, and the only way that you can really say you're delivering an ablative therapy now and having that mode of therapy like an intervention when you put a probe in and burn a tumor in real time, the only way that we actually can truly say we know what we're doing, we're approaching in a surgical way, is if you can see the tumor every single day and blast it with a high dose of radiation every day. Right. You can see it while you're doing it in a way that a surgeon sees while they're cutting. That's a big departure for radiation oncology because we weren't trained like that, and now we've had to retrain and think like that and be there hands-on and do it. Once you start doing it changes the game of radiation oncology globally. Let's just think for a moment here. Let's just fast-forward 20 years since we're talking about the future. In 20 years' time, what proportion of patients do you think might be treated with online MR-guided adaptive therapy? A wild guess, obviously. Won't hold you to it. Well, the thing is, in 20 years, hopefully everyone's alive and not susceptible to COVID anymore. At the end of the day, when we start treating curative patients, I think every single patient's going to need tumor-directed radiotherapy, by meaning you want to see the target. It's not going to be a situation where we accept not being able to treat the actual tumor and using a bone surrogate. There may be some palliative indications. Still, there will always be some degree of simple radiotherapy. My anticipation in 20 years is that cone beam CT will be completely phased out. Interesting. Do you see merit in the strategy of doing CT and cone beam CT-based online adaptive for the things that might be visible with CT? It's an interesting question because if you think of some tumors where you could see with a CT, and some of the CT image guidance is getting better, so you can at least see it enough to know you're hitting it. Are you able to see it enough to understand the pattern or progression of how that tumor is changing? You cannot. You can't do it unless you have an MRI. With the advances in the MRI, and that's why we want a high field strength MRI, we're not going to go for something that doesn't allow us to be in the future now, and that's what a high field strength MRI does. You can actually see how that tumor is changing and then make your adaption. On a CT, you could maybe adapt to the position, but you cannot adapt to the tumor morphology and pattern of spread. You obviously made the decision to go for a high field versus a low field. What was your thought process there? Well, the thought process was this. When we looked at some of the technologies with low field strength MRI, it was too crude. Just the ability and the flexibility in the imaging was too crude. Right away, if it was a simple situation where we simply maybe wanted to gate and use some crude marker of how things are moving and then adapt radiotherapy plans on that, maybe it would've been okay, but we weren't interested in that. We wanted to go for the future now. We wanted to also develop advanced MRI. With our research institute, we want to be where we're going to be in 10, 20 years in the next three years, and the only way we're going to do that is with a high field strength MRI. Even that is a challenge at a 1.5 Tesla MRI, but we're getting there, and that's because the computing power is so great now that we can actually use those MR images and understand them better. You will not be able to do that on a low field strength MRI. I think you're alluding to biologic adaptive radiotherapy and sort of the potential of using quantitative or functional imaging or biological imaging. How do you explain that to a patient? Do you feel like patients will understand that story? I think so. When you explain to them that, look, the entire tumor doesn't behave necessarily the same. There are going to be pockets that are aggressive. There are going to be pockets that are not aggressive. We simply treat the whole thing as one because we don't know. If we could understand where the aggressiveness and non-aggressiveness is, then we can differentially radiate the regions of the tumor. This has been kind of the holy grail of reducing toxicity and improving cure rates with radiation, but we've never been able to do it. The only reason why you're able to get into this paradigm is because of MR image guidance. How do you feel now going into the treatment? How do you feel differently going into the treatment knowing that you have all this information available to you? What is that like for you as a physician? I'll give you one word. It's called relief. When I know my patient's going on the MR-Linac, I feel a sense of relief because I know that patient is getting the best care possible, and I'm going to know what's happening to that tumor through that journey. When they say, "Oh, I got a little bit more headache," I turn to the image and say, "No, everything's actually okay. You just have a headache." If I see a lot of swelling, I'm going to be like, "We've got to start some medication, and let's figure it out." It's a sense of relief that I have, and that's an overwhelming feeling, not only for the physician but also for the patient. I bet if your patients hear you say that they will feel great relief as well. Dr. Sahgal, thank you so much for your time this evening. Really appreciate it. With that, I'll pass it back to you, Cecilia. Thank you very much. Thank you, John and Dr. Sahgal, for sharing your view with us. Last Friday, we had the last MR-Linac Consortium meeting, and in this meeting, there were more than 650 participants from 19 countries discussing the use and the processes and research paper of our MR-Linac. Gustaf, what is your reflections after this meeting? It's absolutely fantastic to follow the progress of the journey with Unity, but also how our users continue to come up with new ways of treating, new ways of doing the studies with MR-Linac technology and the Unity. Here I have a picture on the Unity evidence development journey, and I think it's important to say that it's three key phases. It is the technical studies phase that started already from 2017. What can you actually do with a machine? Diffusion-weighted imaging, for example, how you can track the multi-leaf collimator. We kicked off the MOMENTUM study in 2019, really building the data generation, 6,000 patients over five years, and we're well into that study right now. You see all these published papers and also the patients treated. We have just kicked off and started the superiority studies. That's really about building the clinical evidence that we, of course, get a lot of questions about. Here you can see a couple of studies on the slide I show here. Throughout this period, our customers can use the existing reimbursement code. That's a question I often get from people. Okay, how is this actually reimbursed? Today you can use the existing, often our customers have their own private insurance schemes and so on, reimbursement setups. Going forward, the ambition, of course, is to go into the third phase of Unity. That is when we have the reimbursement in place. That's also you see in this kind of slide that we go from proof of concept to data generation to clinical evidence. We said that that's post-2022 where we go into that journey. I know during the consortium meeting, that was the whole week last week, there were more than 100 abstracts that were submitted. Can you give us any research updates? Yes, I have a bit of breaking news from the consortium, some of the studies that came up, and we really see great progress in the clinical journey, and we have a couple of new studies, and I showed some of the Q2 and Q3 as well. We have a very interesting study on head and neck cancers. That's the combination of immunotherapy and MR-Linac-guided radiation therapy. We see that's a big promise of this technology, where you can be so precise and also combine it with immunotherapy for head and neck. Another study is around kidney cancer, and kidney cancer is a cancer type that's very resistant to radiation. When you can become so precise, you can treat kidney cancer also in a better way, and there was a study on that as well. The third area that I think is really promising and very interesting as well is rectal cancer, because rectal cancer, often you do a combination of radiation therapy and surgery. I think being so precise as you can be with a moving target with Unity-enabled treatments, then it can become more surgical as well. I think here we have a couple of examples from the studies that came out from the last events and the last MR-Linac consortium meetings. Thank you very much for this very latest news. Thank you. Now we will make a short break, and after the break, we will be talking about the business that accounts for 40% of Elekta's revenue. Stay with us. [Break] Another key element of our strategy is our service business. With me here, I have the Head of Global Service, Paul Bergström. Welcome. Thank you. Paul, the service is an important part of Elekta's business. Can you tell us your view of our services today? Absolutely. It's extremely important both for Elekta as well as our customers. I think we have seen the last 10 years now during the pandemic of just supporting our clinicians and customers of keeping the solutions up and working during the pandemic, and receiving an all-time high on customer satisfaction. Both from a customer perspective and then on Elekta, you spoke earlier about the 40%. The last 10 years, we've had a substantial growth, and we came from roughly 25% of the total turnover, and now we're up to a little bit more than 40%. It's not equally distributed, is it? The growth has been equally distributed across all the different geographies and markets, but we see large variations, and these variations are really coming from what kind of attach rate we have. How many contracts we have in each market, and then really the product and the price mix. Lionel, for example, brought up how he views Elekta Unity and the service contract and the essential piece. We heard Larry as well talking in Americas, mention service as one of the key aspects, and it is more than 50% in Americas. In EMEA and APAC, a little bit less of a share, but as I said, the growth has been there earlier, so really doubled up. Yes, we do have a large potential increasing this. What are the customer looking for when closing a service contract? It's really three things. Clinical availability, the second one is predictability to treat. We talked a lot about the patient and the patient journey here as well. The last and the third one is really how do we make sure that we run the operations as efficient as possible together with the clinicians. As Gustaf mentioned, we're becoming a lifetime companion, being extremely close and bringing in the customer feedback into product development. Can you describe the revenue streams from the contracts? Yeah. That's the good thing if we just take on the contracts side, so very predictable and recurrent. If we look upon the charter that we have, a product is roughly 10, 12 years out in the market. With a contract then having every year a revenue stream coming in, it becomes then predictive. Across the full sales, half of the revenue basically goes to the product and half of it goes to service. Think it's very clear when it's visualized like this. Yes. Yeah. How is the correlation between the service revenue and the installed base? I think it's good to really have a look on the installed base because we want to grow with the installed base. That's also why it's so important that we have the solution sites that is really growing the business, and we have a growth in installed base. If we look upon the last 10 years, we have had an installed base growth of roughly 8% in average per year, whereas we've seen the service revenue growing with roughly 12%. Behind these figures, we've really outgrown installed base. Behind these figures, it's really exchange rate because service is always a local business. It is about what we saw in the beginning about the service share depending on the different markets, and then of course, the product and price mix. Based on what you just said, what is your strategy going forward? The most important is which are the customer targets that we're following? Clinical availability, predictability to treat, and operational efficiency. We've done it in four different areas: digitalization, growth, people, and process and platforms. How do you measure your success? On the top one, customer satisfaction, of course, to have that as the first critical piece and the service quality thereof. Financials, the revenue that we went through, and then operational efficiency, both on our side as well as on our customer clinician side. The first thing you mentioned was digitalization, and you also stressed that in the beginning that it was important during COVID. Can you give some more color on the digitalization? Digitalization and innovation and truly a forerunner. If I take one of the examples here, how do we connect all our installed base? We have 18,000 devices connected, and it's roughly 80% of all the LINACs out there. We take all the sensors, and we then see the usage of the machines as well as we can predict the failure. We're using AI, artificial intelligence. We're using all the big data that we're bringing in, having algorithms coming in in order to predict the failure. Also having patents that we file on these algorithms. With this, we've been able to save 200,000 patient slots per year. If I just want to show, this is IntelliMax in a movie. This really shows that we make progress in the transformation of digitalization. Yes, I'm extremely happy that we started this digitalization already before the pandemic. If we look upon just some statistics, on the left-hand side here, we really see this is the uptime of the solution. We really kept it on the same level as we did before pandemic, thanks to the digitalization. On the right-hand side, we've also seen how much we've been able to do remote. We had a huge leap from 55%- 66%. That is really an impressive increase. Not everything can be measured in hard figures. Can you tell us what this meant during COVID? Do you have any examples? A few, because that's really when it becomes interesting, taking the example. If we then just take the digitalization of a whole logistics chain together with IntelliMax that you just saw, we can predict failures. We can send the right spare parts before it actually fails and then plan it with the customers so there is no downtime for the actual patient. If we look upon all the Elekta Care support centers around the globe, we have digitalized it. Overnight, we could actually turn everybody into home workers and take it all from each home and following the sun. If you look upon education and training, thanks to the digital platform, we always kept very close relation with our customers and all courses open. It do means that you increase one of your targets that you mentioned earlier, the customer satisfaction one. It's been very humble, and I'm very pleased to see all the effort. We reached an all-time high on customer satisfaction this year. I understand that maintenance is absolutely key when it comes to providing service. What is else in our service offering, or more importantly, are there any changes going forward? I think it's been an absolutely fantastic journey. Let's go to the slide, and I'll get through a little bit of the plan and my views ahead. What do we have here? This is really the kind of business that you can do from a service perspective. If I start here, we are doing, or rather what you mentioned regarding maintenance. What we have furthest down, repair, support, and maintenance, sort of the absolutely most essential, clinical uptime, really making sure that everything is really working out. Going further, I would just highlight the operational expenditure on a clinic is roughly 70% in radiotherapy, which means that absolutely cost and optimizing it is extremely important. Taking and going into the next step, what can we then expand? The first one, value-added services. For example, Maurits spoke about it earlier as well. How do we really drive workflow optimization? How can we further do with education and training, startup services, physics as a service? There's a lot of things within the value-added services. It's also how do we leverage all the data that I spoke about earlier? What about the pay-per- use and the other ones? If we take the next three one, it's even more looking from the business models as such. Now during the pandemic as well, how do we make sure that we are that customer-close company that are looking from the business model that makes it easy for both of us to actually make this business happen? Of course, we've already started from a software perspective, we're doing the subscription services. It will be a continuation here, and it will also be managed services, outsourcing, managed equipment services, et cetera. Of course, this variation in business model will be small in the beginning, so it will be a very gradual transition. Absolutely. From a financial perspective, that will be gradual. For us and the customer, that will be a large focus here going forward. Paul, can you give us and summarize three messages that is important to service going forward? Absolutely. We've had a absolutely tremendous journey coming here, and it's an even better journey going forward. We will continue to grow faster than the installed base on the different geographical areas. Of course, margin is an absolutely key from a service business. It will be supported by three things. Digitalization, that I started off with, being the forerunner and making sure that we really leverage this. The lifetime companion, making sure that we are that close, making all the customer feedback loop into the product development that we spoke about. Really expanding our service offering. Thank you very much, Paul, for highlighting these aspects. Now let us leave the offering and focusing on the geographic perspective instead. We start by moving to India and meet some Indian women who have beaten their cancer with brachytherapy and got their normal life back. Watch this. [Presentation] Access to radiation therapy is particularly challenging in emerging market where the need for building up capacity is the greatest. Consequentially, it's also where we have the largest growth opportunity. Therefore, I would like to welcome Habib Nehme. Hello. Nice to see you. Who is responsible for Middle East, Africa, and emerging markets in the Asia-Pacific region, except China. Absolutely. Just to clarify, today you will be talking about the emerging market in total, not only the areas you're responsible for. Yes. We're going to talk, Cecilia, about emerging market in general. Some of the emerging markets share the same patterns. I don't cover all these emerging markets, in general, we're going to talk about that. Can you please start by describing the situation in these countries and the impact it has on the health systems? Absolutely. It's very interesting situation there because emerging market is like 155 countries, and it's only kind of 37 countries developed markets. In these 85 countries, they host 85% of the global population, 65% if you take out China. 40% only of the cumulative global GDPs are in these countries. What's interesting about the emerging market is that the GDP growth pre-COVID was faster than the developed markets by one point. They still spend around 5% of their GDP on healthcare. This is evolving year after year, and definitely they will reach a certain stage, the conversion point of double-digit expenditure versus GDP on their healthcare. What is the status of the install base in the emerging markets? Yeah. We can say when we look at the numbers, like 40% of the global radiotherapy or the radiotherapy install base is in these emerging markets. We can say they are underserved. Especially when you see that 10 million new cases per year are registered in these markets, almost double of this number is the number of patients living with cancer. It's a huge, underserved. That's an awful many patients. How important is emerging markets to Elekta? Oh, it's very, very important. I mean, the last 10-13 years since the BRICS, these markets are developing more and more, and 30% of the revenue of Elekta are in these markets. How important it is, we have more than 50% of market share. It's very, very important. We have a network of distributors there where 25% of the revenue of this 30% is coming from this network of distributors. Extremely important for us. What has driven this large share then? Yeah. Elekta has a large portfolio and large spectrum of solutions and services in the line of the radiotherapy, either internal beam, external beam, informatics, or radiosurgery. We're pioneering in radiosurgery. Two important drivers are the software and the services. You've heard Paul before talking about service and the uptime. Our customers asking more and more about uptime, about efficiency. Clinicians, because of the human capital scarcity as well, asking for support in decision-making, and this is enabled by software. The mix between software and services making that we have a good mix of margin as well, and profitability there. It doesn't mean that the emerging markets are homogeneous, does it? Oh, I wish they were. You have a large spectrum as well of diversity in the emerging market. You have countries that are waiting to have their first LINAC, and countries like Turkey having three to four LINAC per million inhabitants. It's very diverse. We're working country by country. It's very important to adapt the solution to the need of the country. Thank you for clarifying that. How bad is then the gap between the install base and the need that is there? Right. It's a good question. We think that the needs is twofold to threefold. If you say that there is around 12,000 LINAC actually in these markets, so should need a double or between double and a triple. How will you approach this market going forward, Habib? Yeah. I think there are two important points, which is the involvement of the government, it's needed. Second point, as a prerequisite, is the partnering with the private sector and the private operators. We are working on these two angles. How does your sales strategy look like? Can you give some more color on that, please? Right. To simplify this, I would summarize them around five points. The first point is the smart coverage and the local presence. We have 650 employees in these markets, 350 if we exclude China. It's very important to be present in this market, depending on the size and on the needs as well. However, we are looking more and more to be local in important market. We've been recently, I've been with Gustaf in Egypt two years ago, and we studied the market trend and the needs, and we have a sizable install base. We went direct there. Same in Indonesia there. The other one, we think that being direct, it will allow us to have more visibility on the market to develop the solution. We talk about customer centricity, and this is being closer to the customer. Paul talked about services. Service being direct, having the install base ownership allow us to have a recurrent service revenue. What about the second element? Second element. The second element is the education. Education, training, and building the human capital, especially important for sustainability. We have developed training academies. I mean, the large spectrum from pre-sales to post-sales, for the customers, healthcare professionals. We have training academies in Turkey, in Malaysia, in other countries. Service training is a cornerstone as well, to enable the field engineer to have the best service and uptime for our install base. This is part as well of our strategy. Now, the third one, before you ask me, is the partnering with the MOH and the Ministry of Health. To drive the adoption of radiotherapy in many countries, the government, the Ministry of Health need consultancy. They need trainings, they need technology planning, and we have invested a lot in governmental affair to be the consultant of some governments. We've successfully achieved a national cancer plan, like in Algeria, in Morocco, in India, and in Egypt as well, and some other countries. This is important. We continue with the fourth one. Absolutely. The fourth one is partnering with the operators, the oncology operators who have developed this know-how in developed countries, and they will transfer it to the emerging markets. This is transfer of knowledge and trainings. We have many examples, like European operators who have invested in Africa, we're talking Elsan or in Morocco or Indian operators like Elekta who invested in Rwanda, in Mauritius. We have many example of successful, I would say, cross-border investment driven by these enterprise and operators. Now we are, of course, very curious about the last and the fifth one. The fifth one. The fifth one, the product is our best salesman. Taking this into consideration and the needs of the emerging market, we develop products like Harmony, I think Maurits talked about that fits the clinical need and the clinical application in the emerging market. Why? Because it's serviceable. It's a small footprint. It's ideal to transfer from cobalt bunkers to radiotherapy bunkers with minimum cost and refurbishment. Actually, I am proud to say that in uncertain, which is one of the operators as well that invest cross borders, we have the clinical Harmony working there, actually. Extremely the five points that you talked about. Great. We talked about the install base when it comes to LINACs, which of course is the vast majority of the market. What about other RT solutions? Yeah. I think we watched all together the video of brachytherapy in India. The mix of cancer in the emerging market, specifically in Africa, is more driven by cervix cancer and breast and prostate. This is the cancer where they benefit a lot. The treatment benefits from the brachytherapy. Elekta has a leading technology in the brachytherapy, more than 70% of market share, between 60% and 70%. In our emerging market, we sell more than 60 systems a year. The life cycle profitability is big because of the accessory sources we sell there. Brachytherapy is extremely important as well. This is strengths of Elekta that covers all the spectrum of the radiotherapy. Habib, very brief, how would you summarize the emerging market and its prospects for Elekta? Let me simplify. If you want to remember one thing, four points. First is, there is a huge gap of needs in the emerging market, radiotherapy. Second point is increasing demand. Yeah. Third point, Elekta is extremely strong. We are continuously investing and growing in this market. If we step back and we think effectively in the emerging market, Elekta is pursuing the tasks of delivering precision radiation medicine to, and radiotherapy to all the patients that have cancer. I think that are great closing remarks, Habib. Thank you very much. Thank you. With that, we close the general part of the emerging market. Let us dig down into one country, China. Now we hear the message from our Head of China, Anming Gong. Good afternoon. My name is Anming Gong. I am Elekta's Head of China. I would like to share some reflections regarding China's view. China is Elekta's second-largest market. We have been the radiotherapy market leader in this country for many years. In fact, according to the latest uncertain market research data, our market share has strengthened further in relation to our main international competitor. In China, growth is derived from both public and private sectors. During this last fiscal year, the strongest momentum comes from the public sector, pinpointed by China's Elekta capacity being way below uncertain. There is clearly insufficient Elekta capacity in the Chinese radiation therapy market. Elekta's focus in the region has been on capacity expansions, even if replacement investments do increase. There is an extensive unmatched amount for cancer care in China, and that is likely to continue. An estimate by the World Health Organization suggests that cancer incidence in China will grow by around 50% until 2040. Precision radiation medicine is well accepted in the region, and an increased number of high-end systems delivering hypofractionation are installed in clinics. The growing demand for new radiation therapy is not only expected from the Tier 3 hospitals, which are the top segment in China, where Healthy China 2030 is facing the challenge to improve the cancer survival rate. Our central government has set targets to expand the radiation treatment capacity to clinics outside of the large cities. The government is releasing quotas for those qualified to apply for a license. Qualified radiation therapy professionals are limited. In addition to product access to treatment with our precise solutions, we needed to help the industry to train radiation therapy professionals. Elekta Learning and Innovation Center, LINC, and Elekta Radiation Therapy Academy are located in Beijing. They trained more than 3,700 professionals in 2020, providing good support to expand the know-how and the technological transformation. The interest for Elekta Unity is also strong in the Chinese market. The top radiation therapy centers and the general hospitals have chosen Elekta Unity and are leading the way for this paradigm shift. Several Tier 3 hospitals are eager to invest in the MR-Linac technology. In Beijing, Elekta has one of our two LINAC assembly lines. During the last 12 months, we have stepped up our ability to deliver systems. Support not only in Chinese market, also shipping to the rest of the world. In terms of innovation capacity, our great R&D engineers developed our newest Elekta Harmony here in China. As of today, Elekta has over 700 employees in China, of which almost 40% are within production and another 20% in R&D. Going forward, we will continue to strengthen our local organizations through further investment and cooperation. We are especially focused on the localized intelligent radiation therapy solutions for the Chinese markets. This will increase the importance to developing the workflow efficiency and precision within radiotherapy. More investments are planned for training and education further support competence of the radiotherapy treatments. We will also continue to drive the MR-Linac technology, and are looking forward to receiving approval to start marketing Harmony. Summary, we have a clear strategy for maintaining our leadership and delivering double-digit growth also in the future. Thank you. Thank you, Anming. The last almost two hours now, we heard about the market and how Elekta will meet this opportunity with Access 2025. This strategy will have an effect on the company's future financials, and how, Elekta's CFO, Johan Adebäck, will tell us. First, Johan, can you please remind us about the midterm outlook for the period until and including 2024 and 2025? Sure, Cecilia. We have three targets. It's on growth, it's on margin, and capital allocation. For growth, we're targeting a compounded average growth rate of more than 7%. For margins, we're targeting an EBIT margin expansion over the period, and for capital allocation, we said we will pay more than 50% of net profit in dividends. Can you tell us how these will be achieved and how it's connected to the initiatives with the strategy that we just heard about? Of course. Let me start with the first target, with the growth target, growing more than 7%. This is based on the initiatives we've talked about today, but it's also based on the market growth of 6%-8%, we are targeting to grow faster than the market. Let me talk a bit about the key drivers for this growth, and starting with Unity. Unity is, with the adoption and more installations, will be a key driver for growth for the outlook period. Secondly, emerging markets. As we talked about, emerging markets has increased its percentage of sales. We see that continuing, and it's also linked to our sustainability goal of increasing access to radiation therapy in emerging markets. Third one is software, as Maurits described, we are increasing and accelerating our investments into software, and that will lead to more growth in the outlook period. The fourth one is service. As we said, we're growing service sales faster than the installed base. The installed base of some 4,750 devices, and that will also be a key driver for growth for the period. We're also launching, talking about the fifth item, as-a-service solutions, primarily for software, but also selectively for devices. This will decrease the capital investment for our customers, and we see this as a growth driver, not least in emerging markets. Finally, new products. We talked about Harmony and another, MOSAIQ 3 and so on. All of these will come in and contribute to the growth we will see for the period. To summarize, innovation, partnerships, and precision radiation medicine adoption will drive top line growth for the next four years. The second target we had was margin and expanding EBIT margin over the period. As you can see, we ended last year with 14% EBIT margin, and the three key components for the outlook here is gross margin. We've had stable gross margin for a number of years, and we foresee continuing to have a stable gross margins for the outlook period. Second, SG&A. We've had good improvements in SG&A coming down as a percentage of sales, and we do see that continuing for the outlook period as well. The third one, R&D. As we said, we will accelerate investments into R&D, but on a net R&D expense level, we don't see any dramatic shift. We see it will be roughly unchanged. Let me talk a bit in more detail on each of these components, starting with gross margin. As you can see, it's been around 41%, 42% for the last four or five years. We've seen a good increase in gross income in absolute terms. Going forward, there are a number of items affecting gross margin, some positive, some negative, and one unknown. I'll talk a bit about that, starting with the positive one. Unity, as I said, Unity is a key driver for sales. It will also increase gross income in absolute terms from Unity. Given the strong sales increase we expect, the net effect on group net gross margin will be neutral. Second one is new products, and we talked about that, Harmony. We expect, and we do see gross margin improvements from new products, both on the pricing, but also on cost spend. The third item, service and software. As these high margin products grow and increase to grow as a percentage of sales, that will have a positive impact on our gross margin. The last positive one is COGS initiatives. We divide this into material cost and variable cost. The material cost is very much around sourcing initiatives, working closely with our suppliers to continuously drive down the material cost of our products. On the variable side, it is very much working around processes in order fulfillment and in service. For order fulfillment, we had one example where we are decreasing installation time for Unity. That has a positive impact on variable margin, variable cost. For service, it's very much about doing more remote and preventive service, which will also positively impact the variable cost we have. If we then turn to a couple of items negatively impacting gross margin for outlook period, and I will start with price pressure on existing platforms. We do have a small continuous price pressure on existing and old platforms, and we see that continuing in the outlook period. The second one with a negative impact is emerging markets. We see as they grow the percentage of sales, total sales, and we do see good momentum in the margins in emerging markets as we sell more comprehensive solutions. On a net basis, it will over time, we think, have a negative impact on gross margin. The unknown item, as I started talking about, is foreign exchange. It's difficult to predict what the foreign exchange effect will be on gross margin. We put this all together, we see that the trend of the stable gross margin we've had for the last few years will continue into the outlook period. Let me switch to another component, and we have SG&A as percentage of sales. We've seen a very good trend here going from 20%- 16% over the last few years. 2021 clearly impacted by the extremely low levels we've seen in travel and sales cost due to the pandemic. That means we will not stay on these levels and we'll see an increase in SG&A in this year we're in now. Post the COVID recovery phase, we do see good fundamentals for keeping that good trend with lowering SG&A as a percentage of sales throughout the period. Let me talk about some of the key drivers for this development and starting with reduced T&E%. Both from a sustainability and also partly from us signing up to the Science-Based Targets initiative, but also from a cost and efficiency perspective, we will permanently lower our travel and T&E cost with 25% compared to pre-COVID levels. Sales and marketing, we'll also permanently lower those as a percentage of sales by continuing to use more digital solutions as we have learned to do now during the pandemic. Talking about process efficiencies, digitalization, centralization, this is very much around having global processes, global solutions, and systems. We're quite far ahead in this area. We have, for example, one global shared service center, we have one global ERP system, we have one global HR system, and one global customer management systems. All of this creates a good foundation to continue to drive efficiencies in our organization in this regard as we grow and expand into new markets. The third component I talked about is R&D. That's a growth enabler for us. As you can see, we've been around 11% of gross R&D for the last few years. We will accelerate that and we will spend more. Gross R&D will go up in 2021, 2022. The drive is this, as Maurits talked about, the personalized precision, elevated productivity, and integrated informatics. Let me also talk a bit about the move we're making from EBITDA to EBIT, and EBIT is our preferred earnings metric. It's a more comprehensive measure. It covers all operational parts of a P&L, and we don't have any significant amortizations related to acquisitions. We want to go to EBIT. Just as a recap, we were at EBIT and went to EBITDA in connection with a large Unity investment we did a number of years ago. That was an investment into one single platform with related capitalizations and amortizations. We're now, as you can see here, in balance, and so we paused this Unity investment. Now both gross and net R&D ended up at 11% last year. We think this is a good moment to go back to EBIT. Talking a bit forward-looking on R&D. As I said, gross R&D will increase in 2021, 2022. We will stay on relatively high levels when it comes to absolute numbers, but it will decrease over time from the increased sales. Net R&D will go down in 2021, 2022, and then will be on a continuous increase for the outlook period. As I said, on a net basis, we don't see any real big change in the R&D expense. Moving into working capital and cash flow. Really happy to be able to show this graph with stable working capital now for two years in a row, -7% we ended last year. We continue to drive for efficiencies and improvements here, primarily in accounts receivables and in inventory. As I said, we're also launching as a service, and that will, over time, have some negative impact on working capital. Looking at cash flow and operational cash conversion, we have, over time, had strong and stable cash flow. Looking at the operational cash conversion rates for five and 10 years, they've been 77% and 78%, respectively. We had 82% last year, a very strong year, and with our best cash flow in absolute terms ever. We do generate strong and stable cash flow over time, and we expect to continue to do so. A bit about the balance sheet and our net debt-to-EBITDA level, our leverage. We have a very low net debt, and we were at 0.25x end of last year. We see this continue. We'll continue to operate with a low leverage level. We will use the strong position we have with negative working capital, strong cash flow, and low net debt. We can and we will use that to support our growth and innovation agenda or strategy. Gustaf mentioned earlier that we're planning to launch a sustainability bond, and we plan to do that after the summer in the Swedish bond market. It will be tied to the target I talked about, access to radiation therapy in emerging markets, and we'll use the proceeds to repay some of our maturing debt. Thank you, Johan, for connecting the financials to the strategy. Finally, if we look at the capital allocation, how will you spend the cash going forward? There's three main items here. It's dividends, as we talked about. We will pay more than 50% on net profit in dividend. We see with our strong financial position we have, we can do both high dividend payments and grow fast. We can do both of it. The second one is the selective acquisitions and investments. That will go primarily into software and innovation, as we have done before. For geographic expansion, we will continue with our geographic expansion, as Habib talked about, where we go direct into more emerging markets, and that will increase our footprint in those markets. Both the last two ones will support our growth agenda. Okay. Any closing remarks from your side? Absolutely. I think we have an attractive value creation model supporting our plan for profitable growth in a sustainable way. It's based on the two objectives I mentioned, high growth with margin expansion, but also supported by the innovation we are investing heavily into, the strong balance sheet, our asset-light business model, and our strong market position, and fundamentally strong financial position to support our strategy going forward. Thank you very much, Johan. Thank you. Now we have made room for those of you listening to have questions. Please use the telephone number that you have received and let us know your question. We will be right back. We will do this in the following way. We have already listeners who are queued up for questions, and we also got some written questions. Please, when you ask the question, do it one at a time and let us answer the question before you take the next one. The first question comes from Kristofer Liljeberg at Carnegie. Yeah, thank you. I have a few, but I'll start then with one. You talked about filing for Unity reimbursement already this year. Could you tell a little bit when you expect to have the first reimbursement in place and what market that will be? Thank you. That's a question for you, Gustaf, I think. Yes. Hi, Kristofer. Thank you for the question. The reimbursement process, as I mentioned on the slide previously, is more a gradual process, and we're driving it country by country, and of course, a big focus on U.S. Then we also have Japan and China and also European countries. It's a very local and nationalized process. The initial focus is on the U.S. That's more the filing part of it. The key thing is then when you get it, of course, and that will take a bit after, 2022, 2023. Okay. Another question. At the beginning of the presentation, you talked about the new software platform. I'm not sure I understand. Is this something that will replace MOSAIQ or Monaco, or is it something else? I would pass this question to Maurits. Yeah. It's a completely brand new software platform that we built from the ground up. What we expect in the next couple of years, that one after the other, we will bring new applications onto the platform. Essentially, in five plus years, it will replace all the existing software. Okay. That's very clear. Two more questions. If you could comment about the potential there and at the same time, put that in relation to the average selling price and whether you see an opportunity maybe to lower the price going forward and by that, trying to take a larger share of the market potential. Yeah, no, great question, Kristofer. I'm happy to say that throughout the year, we have been able to reduce the COGS. COGS for Elekta is two things anyway. It's material cost, where we've been through better procurement processes, et cetera, been able to reduce the MR or Unity COGS, but it's also the installation process. If you remember one of the slides Lionel showed, it's quite a dramatic reduction in the time for the installation, and that's also part of the COGS. That will continue going forward because the key thing for Unity is scale. We talked about these 24 Unities in a year, so to say. We didn't fully reach it last year due to COVID. We see that coming into next year, you get the scale on the gross margin and the EBIT margin as well in that business line. I think price-wise, we have always said since day one that we started off with the eight to 10, but we would share some of these benefits we can drive in COGS reduction and process excellence with our customers as well, of course. I think we have done that to some extent throughout this period. I'm sorry, Kristofer, I got to stop you there. We want to limit the question to three at a time. We move on to the next caller, which is Lisa Clive from Bernstein. Lisa, do you have a question for us? No question from Lisa. We can take a question that we got during this Capital Markets Day through email, and that goes to Habib. The question is, how will this competitive landscape that changed last summer impact the emerging market, in your view? Yeah. Thank you for the question. The thing is that having imaging as well will necessarily result into treatment. It's reinforcing the fact that the needs of the treatment on cancer treatment. From our side, we didn't see acceleration of these or the impact from the competition point of view. We didn't see this effect. However, we think that we are still the only company which is nimble, agile, focused on the oncology treatment, and it's beneficial. For us, it's a good growth journey. Thank you, Habib. In the meantime, I think we have Lisa on the line. Lisa, can you hear us? Oh, yes. Hi. Hi. I was listening to the webcast and trying to figure out how to connect with you. It was very frustrating. Just a question on the software side of things. As you get more involved in software, can you just talk about how this potentially expands your total addressable market? In particular, there are a number of adjacent sales areas that go with LINAC, namely treatment planning, patient positioning, quality assurance. Some of these you're involved in, but you have a lot of smaller competitors. As software becomes more of your calling card, how much market share can you gain in each one of these segments? Are there segments here that you don't particularly participate in today? Maurits, do you want to take this? Happy to. I think as I explained as well, there's two sorts of software that we're talking about. Actually the collaboration with Philips is also a way to accelerate that as well in that space. Then we have the software in our informatics portfolio. That's more about the traditional OIS businesses today. I would say in both areas, we see opportunities. I would say the software around the treatment devices, there's a little bit more of a consolidation taking place. We've seen it in the QA space, et cetera. Since this integration with the treatment devices are becoming more and more important. While on the informatics space, we see a lot of new initiatives and companies still moving around. That's very clearly in another phase. Both spaces, I would say form definitely an opportunity for Elekta. Yeah. I think we've shown as well that throughout the last couple of years, we acquired a quality assurance software. Yeah. Patient reported outcome software. We're broadening our offering on the software side as well, and it is the fastest growing part of the market. We will continue to focus on it, but the core will continue to be precision radiation medicine and the software around it. Lisa, did you have a second question? Great. Yes, just a related question. What are your thoughts on interventional oncology? Obviously, that's a fairly adjacent market that you are not currently very active in. Yeah. I can start and please chip in, Maurits. Interventional oncology is an area that we've been part of in a way through brachytherapy as well. It is a field that's very interesting because there's many different applications and many different companies driving that field. We are looking at many of those opportunities. I think the core of what we do right now is within the brachytherapy space, I would say. Yeah, just to add to that, I would say interventional radiation type of applications definitely beyond brachytherapy. We don't have currently plans to go into interventional radiology. We see that today as a space that we don't need to go into. Great. Just final question. The MR-Linac units that you expect to place in the next 12 months, what proportion of those are going into research institutions, versus other institutions? The majority will go to what you say other institutions. I think we've come to that phase. It's leading cancer care institutions, of course, but the focus for the way we are right now is to quickly come up and treat big patient volumes. There's very often, of course, also a research component to it because it is a new way of treating. It is the processes where I think a lot of clinicians in radiation therapy department also need to get used to what you can do with MR functionality. I think it's a combination, but primarily into treating hospitals, I'd say. Great. Thanks very much. Thank you, Lisa. Next on the line is Veronika Dubajova from Goldman Sachs. Please, Veronika. Okay, Veronika, are you on the line? Excellent. Hi. I hope you guys can hear me okay. We can now. Thank you. Very good. Fantastic. I'll have three questions, hopefully one very quick and then two slightly more in-depth. The first big picture question is just would love to get your thoughts on what is a reasonable margin improvement to expect from you guys over the midterm. I appreciate there's quite a lot of movement. You've just given us very vague guidance for margin improvement in general. It'd be great to think what you think is achievable on a five-year basis on average, if you can just help us quantify it, or what you'd consider successful or not. That's my first question. My second question is. Let's stop there, Veronika. I think this was directed to you, Johan, please. Yeah. Thank you for the question. Yes, as we said, we target an EBIT margin expansion, and I went through in some detail, I think, the key drivers as we see it, and we will not qualify that more than what we've already said. We're, I think, and I hope we've been open and transparent on how we see the different drivers for this margin expansion. Okay. Thank you. Can I just ask a follow-up around that? If I look at the drivers that you've outlined, it sort of seems like it's predominantly SG&A leverage and then the amortization around R&D. Is that a fair way to think about the levers that you see? I would say the SG&A leverage, I would agree with, to a lesser extent, I don't think the amortizations in such are any key driver for the margin expansion we see in this period. Okay, that's great. Thank you for that. My second question, if I can, is just to follow up on the timeline for differentiated reimbursement for Unity. I just want to understand exactly what the next steps here are, to what extent you guys already have data that you can submit, to what extent you still need to generate the data. I guess, what is the data that you are hoping to show to the regulators to get differentiated reimbursement? Is it immediate short-term data around things like side effects, or is it something a bit more longer-term? If it is something a bit more longer-term around survival, do you have that data today, or do you still need to work on that? Since we don't have Lionel Hadjadjeba in the studio, I will pass this on to Gustaf. Yes, absolutely. No. Veronika, it is a journey, and I think it's the customers, the clinicians that will file and have the ongoing discussions with the payers. To some extent, that's happening already today, and we are more supporting that process through the MOMENTUM Study. The MOMENTUM Study is about building the data and the observational study, but also develop the protocols for the different cancer types by site that then our customers and the consortia members will develop the protocols. With that data, we can then go to the payers, and they will go to the payers to get to the new reimbursement levels. This will happen different timing country by country. As mentioned, we focus a lot, of course, on the U.S. first because it's such a large market, and set the scene for the rest of the world. There's ongoing discussions in Europe as well as in China and Japan at the moment as well. The key data points will, of course, be when we file. The process after that is more difficult to exactly say how long time that will take because that's more on the regulator or the payer side. Okay, Gustaf, can I clarify? You will not be doing any of the filing. This is purely done by folks who have Unity and would like to pursue differentiated reimbursement, and it's up to them to get the data and get the filing done and get the agreement. Yeah. The key thing for us that we support, we facilitate through the MOMENTUM Study that I think in radiation therapy is quite a new and novel way to collect the data needed and also the clinical evidence that then could go to the payers to then get the reimbursement. That's how the process will look like over the next years here. Okay. Thank you. Then very quickly, just a quick follow-up on the Philips partnership. Thank you for all the color around R&D and availability of additional software. Just curious, does the commercial relationship change at all? What I mean by that, is there a greater incentive on Philips's part to sell your systems or vice versa? Is the sort of expansion of the collaboration really more on the R&D software imaging side of things? I think the key thing is it's both. It's both innovation, and Maurits, you talked a lot about the innovation side, but it's also the commercial side. We see it, Elekta should be easy to do business when we talk about these larger deals. Throughout the innovation initiatives, we also see that our solutions that we can offer together will be better integrated, and therefore, we also see that as a big commercial opportunity actually, going forward. Both. Okay. Thank you, guys. Thank you, Veronika. The next caller is Scott Bardo from Berenberg. Please, Scott, go ahead. Can you hear us? Hello? Scott? Can indeed. Great. I hear you. What is your question? Thanks, Cecilia. Sorry, a time lag. Yes, thanks. Two questions, please. The first one, I just wonder if you could give us a bit of an update on the Unity function sets, please. I think in your presentation you mentioned a gating function was something you were working on. I think previously you communicated that that should be ready around now, as well as the automated tracking function. I wonder if you could just clarify when we would likely see those features on the system, please? Absolutely, Scott. Thanks for the question. Automated gating, the plan is to file in the first half of 2022. That's the plan. Of course, what we discussed about motion management, that would be the journey after the automated gating. The automated gating is the first step, filing in the first half of 2022. Okay, thank you. You've made quite some discussion of personalized radiotherapy, and I know for Unity, there's lots of projects going on for the ability to do functional imaging. Can you help us or provide an update for where we are within that journey? How close we are to getting tangible personalized approaches with Unity? If I got the questions right, Scott, it was the functional imaging capabilities of Unity and how that is driven out in the studies, and I think it's part of the studies right now. When you look at those technical studies I mentioned on one of the slides, that was diffusion-weighted imaging. That's already now part of the studies that some of our sites are doing at the moment. It's ongoing. Okay, maybe last question on Unity please, which I think ties into a broader question on the gross margin development, and having seen the progress of Unity from concept to commercialization. I think the consistent messaging has always been that Unity would confer positive gross margin mix to the group. I think I understood you now saying it's more of a neutral effect, and you have more neutral gross margin expectation for the group. I guess the question is that conservatism or does that lack aspiration? Can you help us understand why your new products are not conferring mix advantage? Thank you. You want to take this, Johan? Yep. It was a bit difficult to hear, but I've understood the question to be on the Unity gross margin and effect on the total gross margin. We do see strong sales coming from Unity. We see strong gross income improvements, and we also see strong gross margin improvements for Unity over the period. Given the strong sales and the increasing portion of our total sales, that entails, if you do that calculation, the net effect on our total gross margin, we estimate this to be neutral over the outlook period we have the next four years. I think it's fair to say we need the service revenue on Unity as well, and that's building up as we speak. Leverage and service is what we'll get to the level that you mentioned, Scott. We're in this build-up phase, and we invested a lot in installers, service engineers to support Unity. That will come. Of course, it's not on the same level of profitability as if you say our software offerings or maybe Neuro and Brachy has more specialized offerings. We will take it over the profitability of the LINAC side, yeah. Thank you. Thank you, Scott. We also have some questions from Michael Jüngling from Morgan Stanley. Please, Michael, can you hear us, and can we take your questions, please? Yes. Thank you. Can you hear me? Yes, we can. Yes. Great. I have three questions. Firstly, on the Philips partnership, I think you said that the revised agreement with Philips happened around six months ago, which is not too far away from when the Siemens and the Varian deal happened. I think at the time you suggested it would be a positive for Elekta. The revised agreement today, how should one view this? Is this a competitive response to Siemens and Varian, and effectively endorsement that the market between imaging and radiation oncology is closing and therefore it's a powerful combination? Or is this just coincidental that you had signed this revised Philips agreement? I'll ask my question two and three later. Gustaf, please. Thank you, Michael. I'll start and then I'll hand over to Maurits that also worked a lot with this partnership over the last months here, of course. The industry landscape changed last summer, and I sometimes describe it as a chessboard that was shuffled a bit, and you need to find your different positions. We've had a lot of discussions on the partnership side and so on to see what the impact would be. We see it still as a positive for Elekta, and if you follow our numbers the last quarters, you've seen we have grown faster than competition and taking a lot of share, especially in the last quarter, 18% order growth. We still believe that the best thing for Elekta is to continue to drive world-class precision radiation medicine solutions. We also acknowledge and understand that we need to have partnerships with other parts of the cancer care ecosystem. Imaging is one example because we believe that is what the patients and the clinicians are after. It's also about the integration of the solutions, and I think Maurits, please say a few word about that. Yeah, a couple of things there. We have been continuously discussing with Philips. This has been a long-term relationship, as we all know, even beyond Unity, so it is not that we just started the conversation. The change in the industry has accelerated some things. That may be fair to say, but we definitely were exploring different areas, and one of the areas I also like to stress is that the investments that Philips has done over the past five-plus years in informatics is, I think, really differentiating versus the other imaging vendors as well. We believe we really gain something with these partnerships. Philips has already, in comparison to the other large imaging investors, has already a play into radiation oncology. By sort of combining these efforts more together, we believe there are benefits. I see it more as a natural evolution and a logic to continue to strengthen our position. To Gustaf's point, it's two companies with one vision because we also believe that even more in this phase, radiation therapy and radiation oncology is a complex environment, that customer focus and more dedication to a customer still can be a differentiator for us moving forward while we continue to partner where it really matters. I think it's fair to say, Maurits, as well, that it's quite a small proportion of the deals we see today that is kind of comprehensive deals. Of course, we expect that to grow over time, and we need to be part of that growth, of course. That's another reason why we're doing this right now. Okay. Question two is also on the Philips partnership, and if I look at the previous partnerships that we've seen in the industry, I think there was one also between initially Siemens and Varian. Didn't quite work out, I think is a fair statement. At what point do you think you have to follow in the footsteps of Varian and become more entwined with Philips, whether that is a merger or not, but something far more meaningful? What would you need to see for this to happen? I think it's about company cultures. I think Elekta, since day one, has always been very open to partnerships. We have always had kind of an agnostic approach, open architecture, and that is what has made us successful, and that's why we also were able to out-compete part of the competition 10 years ago. I believe in this kind of open perspective, and I think we share that culture with Philips. That's in all the discussions we've had, and I think Unity, we have developed Unity to a large extent together, but also with the customer. I think it depends on what company culture you have and how you partner and collaborate, and I think, as I said, Elekta's always been quite open to partnerships and collaborations, but at the same time- Okay protecting our core. That has been, and will continue to be, precision radiation medicine. Okay, thank you. The last question is on the growth drivers that you mentioned for revenues over the medium term. You mentioned Unity, emerging markets, and software, et cetera. It would be helpful just to get a sense of how important you think each are, and maybe you could just assign a number as Unity, 30%-40% or so of how investors should be thinking about this organic growth target. Similar for emerging markets and software. Just some sort of guidance so we can get a feel for how relevant and important each of those components are. Let's start with you, Johan. Good question. I don't think we can quantify it as you want. Looking at how we listed it, I think is how we look at it in importance. Having Elekta Unity and emerging markets at the top there, I think is a real indication where we see the biggest drivers for the top-line growth for the outlook period. Software and service as well. As a service is something we're getting started. It's being launched. I wouldn't expect a very significant contribution from that. The new products, if you look at Elekta Harmony, for example, are to some extent replacing existing ones. That is a growth driver, but I would take it as in the way we listed it from top to bottom. Great. Thank you for that. Thank you, Michael. We have received another question here earlier, and it's from Björn Olsson, and it's to you, Paul, and concerns services. How high do you think that your remote fix rate can become? Extremely interesting, first of all, how much you can do remote. In the end, it's a physical solution. I think there are a few parts to reflect on. It's been a great leap now what we've done here now just the last year, reaching up to 66%. That directly has impacted customer because it's a lot faster responses, we can do everything remote, we just do the last piece in order to fix it and get the machines up. Now what we're doing, you can only sort of drive it to a certain extent. We can get faster and faster, getting better quality, which then of course will also impact both customer satisfaction as well as financial. The things also, what you alluded to earlier, we're getting so much closer to our customer, the feedback loop, so we can drive that into the product development, hence driving even more of this remote assist rate. You reach a certain level. Thank you, Paul, for clarifying that. We have another call from David Adlington. Can you hear us? Can you please state the first question, David, from JP Morgan? Yeah. Hi, guys. Hopefully you can hear me. Yes. Yeah, just coming back to the Unity reimbursement, I think, Gustaf, you pointed towards a gradual process, starting a little bit after 2022, 2023, so a couple of years out. Presuming that starts on an indication-by-indication basis, so presuming something early like maybe pancreatic and then evolving from there. Do you think there's a tipping point where your customers will need to see a certain number of indications coming through before they place an order? Just trying to gauge at what point do you think customers will be putting off making an order because they want to see the reimbursement, and then will we see a wave of orders on time reimbursement starts to gain some traction? Thanks. Hey, Gustaf. Yes. David Adlington, I see it, of course, reimbursement is key, a high reimbursement rate for some of the customers to take the investment decision. We see that that's the phase III. I think the phase II we're in right now is really big interest to be part of this shift, to be able to treat in a different way. We still see a good growth potential and sales funnels as well for Unity order based on that phase as well. Our customers can use the regular SBRT or SRS reimbursement codes, many of them also have specific agreements, so they can support reimbursement more specifically for Unity, for private health insurers and so on. The next phase will be when we get to the different reimbursement codes, cancer type by cancer type, and then we see a further growth trajectory and a further uptake of the technology to a larger installed base. As we've said today as well, and reconfirmed, we believe that at least 25% of the installed base and new orders should be able to be targeted with MR-Linac technology. Perfect. Thank you. Okay, it's time to wrap this up. Thank you so much all for participating in our Capital Markets Day. It has been a pleasure. Gustaf, maybe do you want to summarize the discussion we have had here today? What are the key takeaways? Thank you for listening in to our Capital Markets Day today. We have talked about the market and the underlying need for cancer care and precision radiation medicine. We also talked about all our innovations that we're driving to help cancer patients around the world. We have also talked about how we as Elekta have come out as a stronger company from COVID. We also talked and launched our new strategy, Access 2025, and part of it was a very exciting new partnership with Philips that we see great potential in. Going forward, we expect to grow faster than the market with a margin expansion. Elekta, we are not just building technology, we are building hope. Thank you