Good morning and welcome to the Getinge AB conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing star then zero on your telephone keypad. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad. To withdraw your question, please press star then two. Please note this event is being recorded. We have with us Mr. Mattias Perjos, CEO, and CFO Lars Sandström. I'd like to turn the conference over to Mattias Perjos, CEO. Sir, please go ahead. Thank you very much, and thanks, everyone, for joining today's conference call. We can move directly into page number two, please, and I will go through some of the key takeaways from the second quarter. As expected, we saw a decline when it comes to order intake and net sales, which decreased by 5%-7.5% organically in the quarter. One bright spot here, though, was that the order intake increased towards the end of the quarter, so an indication of better momentum going forward. The development for the quarter as a whole was affected by a reduced production of vaccines against COVID-19 and that the number of patients in need of life support in intensive care units was significantly lower than what the healthcare system and we had predicted, combined with a milder flu season as well. In addition to this, the Russian invasion of Ukraine, the lockdown in China, and the supply chain challenges that we see globally also had a negative impact on our volumes in the quarter. From a product category perspective, this means that the demand weakness, though, is entirely attributable to our sterile transfer offer, our ventilators, and our products for ECMO therapy. Most of our other categories grew in the quarter, even if the growth in some areas was a bit subdued by the above-mentioned external challenges. We can see now in the dialogue with customers that they are planning for a normal flu season in the second half of the year, which is expected to lead to a recovery for us when it comes to especially intensive care products. The scarce supply of components had a negative impact mainly on acute care therapies. For the group as a whole, the effects are estimated to be between SEK 300 million and SEK 400 million in the form of delayed deliveries in the quarter. If you look at demand in our other product areas, such as products for elective cardiovascular procedures, infrastructure linked to operating rooms and sterilization centers in hospitals, and also products for pharmaceutical manufacturing, all these categories saw an increase in the quarter. We had a favorable earnings effect from currency during the quarter. Even if you adjust for this, the margins held up very well given the lower volumes, the unfavorable mix effects that we have in the quarter, and also the negative effects from supply chain challenges. On an EBITDA margin level, the lower variable cost for employees are an important explanation for this and also partly for the gross margin. We can move then over to page number three, please. If we focus on some of the key activities and events for the quarter, we start with our offering. Our work to strengthen the customer offering continues, and after the end of the quarter, the acquisition of Fluoptics, which offers leading technology for decision support in advanced surgery, was completed. We also launched a new DPTE Alpha Port, our DPTE-EXO. This is the first of its kind DPTE Alpha Port with the external opening and integrated funnel, which secures automatic aseptic transfer and also improving the operational efficiency for Life Science customers worldwide. This provides our customers with a secure and reliable and automated transfer solution. We also launched a new version of the system for our anesthesia product family, Flow. This means that the automatic gas control option will become available also on the Getinge Flow-c and the Flow-e anesthesia systems, in addition to our already existing platform. AGC supports low flow anesthesia, which reduces the consumption of anesthetic agent and thereby reduce running costs, and it also reduces the greenhouse gas emissions, so this is an important thing for our customers. Getinge also received the prestigious iF Design Award for Guide. Guide is a new system for making acute care devices look, feel, and behave the same way. This system is based on the assumption that if all Getinge devices used in intensive care units and in operating rooms look, feel, and behave the same, it becomes easier for clinicians to learn how to use them. This reduces the risk of errors, it lowers the cost of training, and is especially valuable now in these times of unprecedented staffing shortages in the healthcare system. On the sustainability front, we have since May now the two production facilities in Rastatt and Hechingen in Germany. They have converted to climate neutral gas, making their energy use carbon neutral and thereby contributing to the overall business goal of becoming CO2 neutral by 2025. In addition to this, we've also invested in solar panels for the production units in Rastatt and Suzhou in China, as well as in a geothermal heating system in the production unit in Ardon in France. On the quality front, during the quarter, we completed an internal investigation related to potential violations of the German Medical Devices Act, for which a total of five current and former Getinge employees are being investigated by the public prosecutor's office in Baden-Baden. We cooperate fully with the prosecutor, and our internal investigation has identified some shortcomings regarding individual interpretations of the quality system and the regulatory processes. In addition to the already extensive remediation measures that we had in place, we're now also implementing a number of structural changes and also intensified training efforts. A couple of changes when it comes to the management as well. As was previously communicated, Lena Hagman, our Executive Vice President for quality, compliance, regulatory, and medical affairs, has decided to leave Getinge. I would like to thank Lena for her contributions to the company. She's been an instrumental part in our work to establish quality processes with the patient in focus, and I wish her all the best in the future. Lena will continue in her current role until a successor has been appointed, but no longer than the last day of December this year. A few days ago, we also announced that Agneta Palmér has been appointed Executive Vice President of Operational Services and a member of the Getinge executive team. The newly established function covers the group purchasing, logistics, IT, and our academy, and has been established to further strengthen group synergies. Agneta joined Getinge in 2018, and most recently held the position as Vice President of Corporate Control at Getinge. A warm welcome to her into her new role as well. This is effective from September fifteenth. We can then move over to page number four, please. As mentioned initially, we had an order intake decrease by 5% and a net sales decrease by 7.5% organically. This didn't match the high growth that we had last year overall. If you look at this from a regional perspective, orders are up in Americas, to a large extent, thanks to Surgical Workflows accomplishing more than 20% growth in the quarter. I'm very pleased to see that Surgical Workflows continues to grow order strongly in the Americas, as we expect North America to be an important market for this business area in the coming years. The year-on-year order comps in Asia-Pacific were especially tough this quarter due to us having record orders on ventilators from that region last year. This was, if you remember, the phase of the pandemic where India was particularly in a difficult situation. The net sales decline in Americas and EMEA is very much linked to the tough comps in ventilators and the products for ECMO therapy. While we saw that strong performance in both Life Science and Surgical Workflows explains why Asia-Pacific managed to remain almost flat in the quarter, when it comes to organic net sales. We can move over to page number five, please. We take everything that I've said there into account and based also on the release a few weeks ago, the outlook for 2022 is that the organic net sales is expected to be in line with actual net sales in 2021. There's been no developments at the end of Q2 or the beginning of Q3 that makes or change our mind in this respect. We can then move over to page six, please. If you look at the order intake bridge from the second quarter of last year to the second quarter of this year, we can see that Acute Care Therapies is down 7.1% organic. The organic decline in Acute Care Therapies is mainly due to challenging comps in ventilators, and that the demand for ECMO therapy products was lower than previously expected in the quarter, and certainly lower than what we saw last year. This contributed to an organic decrease in order intake in all regions. While we could see that an order intake increased in products for planned cardiovascular procedures, this was not enough to compensate for the decline on ventilation and ECMO. Life Science down 5.3% organically in the quarter. This was mainly a result of lower demand for products linked to the production of vaccines against COVID-19. This primarily affects the order intake for our DPTE-BetaBag within the sterile transfer sub-segment of Life Science. The organic growth in Washer-Disinfectors in service and spare parts was strong in the quarter for Life Science. If you then look at Surgical Workflows down 1.2% organically, and the organic order intake decreased slightly as a result of lower order intake in infection control in Asia-Pacific and reduced order intake for products for operating room in EMEA. When it comes to Americas from a Surgical Workflows perspective, we saw good growth in all our different product categories. We can then move over to page number seven, please. This is the net sales bridge between the same quarter last year and the Q2 of 2022. Acute Care Therapies down 17.7% organically, mainly linked to lower demand for ventilators and ECMO therapy products, and also some component shortage challenges due to the global supply chain situation. This development overshadowed the net sales increase in products for elective cardiovascular procedures. Net sales in capital goods declined organically as a consequence of lower demand for ventilators and also because of component shortages. In Life Science, in contrast, we saw 7.7% organic growth. The growth in Life Science net sales is attributable to sterilizers, consumables, including the DPTE-BetaBags, service and spare parts. The strong percentage growth in APAC is primarily linked to sterile transfer and also service products. We could see that for Life Science, supply chain challenges had a negative impact on net sales in the quarters. There are some delays impacting the performance in our smallest BA as well. Net sales in recurring revenue increased significantly as a result of deliveries and orders from the previous year, primarily related to DPTE-BetaBags. If we then move to Surgical Workflows, we had 7.6% organic growth. The net sales increased organically in all product categories within Surgical Workflows, despite some of the supply chain challenges that we've seen. In relative terms, our Digital Health Solutions grew the most, followed by products for operating rooms. We also saw good growth in all product categories in both Asia-Pacific and EMEA, while sales was slightly negative in Asia-Pacific due to infection control. Net sales increased both in capital goods and in recurring revenue, where you find consumable service and spare parts. Currency had a SEK 564 million or 8.6% positive impact on net sales for the group in the quarter. Organic net sales of capital goods came down significantly in the quarter due to tough comps, but also due to some supply chain constraints. With that, we can move over to page 8, please, and look at the gross profit evolution. Our adjusted gross profit decreased by SEK 269 million- SEK 3.355 billion in the quarter, where a positive FX effect accounted for SEK 348 million. For the group as a whole, the adjusted gross margin decreased by 4.7 percentage points as an effect of lower volumes, negative mix effect, and increased costs linked to inflation and supply chain challenges. The effects were partly offset by price increases, by productivity enhancing measures, and also support from currency. For Acute Care Therapies, the adjusted gross margin decreased by 5.2 percentage points relative to the corresponding quarter of 2021. This is a result of the lower sales volume in ventilators and in ECMO therapy products. For Life Science, the adjusted gross margin decreased by 4.2 percentage points, mainly due to lower margins in consumables and Washer-Disinfectors, as well as some supply chain challenges. In Surgical Workflows, the adjusted gross margin remained essentially unchanged despite the increased cost and the supply chain challenges, where this is thanks to both better sales volume, some productivity improvements that we've been working on for quite a long while now, and also currency effects. With that, we can move over to page number 10, and I hand over to you, Lars. Thank you, Mattias. Adjusted EBITDA decreased SEK 294 million compared to the same period last year, while the margin decreased to 14.3%, mainly due to the lower adjusted gross profit, which ties back to the lower volumes, favorable mix effects, and supply chain-related costs and challenges overall. Adjusted for currency, GP had a -5.8 percentage point impact on the margin due to the lower volumes and quite different BA mix compared to last year. OPEX is down materially organically to a large extent due to lower variable costs related to employees. In actual, it is up SEK 11 million year-over-year. This, together with the volume and BA mix effect on the margin year-over-year, takes us to a margin contribution of -0.7 percentage points. Depreciation and amortization is impacting the margin by -0.3 percentage points, and currency had a positive impact of 2.1 percentage points on the margin. All in all, this resulted in an adjusted EBITDA of SEK 956 million and a margin decrease of 4.7%. Over to page eleven, please. Free cash flow continues to be positive, even if we don't reach last year's level. That was impacted by a higher level of deliveries, net sales, operating profit, and supportive terms for payments. The change in working capital is explained by a combination of seasonality, where we're building inventory for the second half of the year, increased inventory levels linked to component shortages and supply chain disturbances, also some purchases of safety stock for components, and the market situation last year regarding mainly ventilators that contributed to favorable payment terms for you, and that the current product mix in itself bring longer lead times. All in all, the free cash flow amounted to a bit more than SEK 0.1 billion in the quarter, and working days, working capital days continues to be well below 100. We are now at some 89 days, down 39.2 days from the peak in Q2 2018. We also see continued strong operating return on invested capital, where we are at 16.4% on a rolling 12-month basis, well above cost of capital. As you can see, we are now closing in on the positive long-term trend on ROIC. Let's move to page 12. The change in net debt year was positively impacted by the cash flow and revaluation effect. Also in Q2, the payment of dividend of approximately SEK 1.1 billion was made, taking us to SEK 3.9 billion debt. If we adjust for pension liabilities, we are at SEK 1.2 billion. This brings us to a leverage of 0.6x EBITDA. If we adjust for pension liability, leverage is at 0.2x EBITDA. Cash amounts to approximately SEK 4.1 billion by the end of the quarter. By that, let's move to page 13 and back to you, Mattias. All right, thank you. We can move then directly to the following page 14 and look at the summary of the key takeaways for the second quarter of 2022. We've seen a recovery in elective surgery largely across the board from a geographic perspective, but this is overshadowed by a number of external challenges that we mentioned during the call here. We've continued the implementation of our strategy that we've been successfully implementing for five years now. Part of this is, of course, including strengthening our offering in different aspects, both from an organic perspective, organic developments, but also inorganically, most recently through the acquisition of Fluoptics. We can see that our margins have been impacted in the quarter by volume decline and mix, and mix effect, and also cost increase due to the supply chain challenges and the overall inflation pressure that we see in the world around us today. We have mitigation activities in place for this. They do yield a good result so far, but this will continue to be active work for the remainder of this year and probably into 2023 as well. We had favorable earnings effect from currency during the quarter, but even adjusted for this, the volumes end up rather well. Finally, I would like to say that our biggest challenge now for our customers is to continue to ramp up elective surgery as the backlog of surgeries has continued to grow for each month since the outbreak of the pandemic. We think we expected last year that we would see a reduction of this, but so far it's actually been growing. This is a continued challenge that we look forward to supporting our customers with in the coming quarters and years. We do everything that we can to continue to be a strong partner in this important task. With that, I open up for the Q&A part of this conference call. Thank you very much. Ladies and gentlemen, we will now begin the question and answer session. To ask a question, you may press star then one on your telephone keypad. If you're using a speakerphone, please pick up your handset before pressing the star keys. If at any time your question has been addressed, you may remove your question by pressing star and two. We'll pause momentarily to assemble our roster. To ask a question, please press star one. We have our first question from the line of Erik Cassel with ABG. Please go ahead. Hi, good morning, everyone. First off, when we've discussed margins, you communicated FX tailwinds on the EBITDA margins of about 100-200 basis points, baked into the margin guidance for 2022. I mean, considering now how our currencies have moved since, I guess you should be seeing more significant FX tailwinds into H2, that by my calculation should support it by another 100 basis points, basically. Considering this, do you still see EBITDA margins declining some 100-200 basis points despite that, then in that case, implying a further deterioration in the underlying margins? Or should we now expect rather flat margins year-over-year? Thanks. Yeah. When it comes to currency, I think you also need to know that there is revaluation effects impacting us positively here this year in Q2 and the first half compared to last year, where we had negative impacts. We don't see the same impacts going forward. That's why we keep more or less what we have guided for so far. The currency movements over the past month will not positively affect you for the full year, basically what you're saying? To some extent, of course, it will, but it's not that material that you are, I think, see when you look at it. Okay. Thank you. The delay of sales at the end of Q1 on supply chain issues and shortages, you talked about that as a phasing effect that would be recovering now in Q2 and Q3, and that was SEK 300 million. Now you say that there has been a negative effect of SEK 300 million-SEK 400 million from delivery delays in the Q2 report. First, I mean, is this relating to some sort of delivery backlog, this SEK 300 million-SEK 400 million number that you're seeing, which would then may also include delays from Q1? If so, how much of those SEK 300 million delays from Q1 have you worked through in Q2? How should we then think about the, you know, phasing of this SEK 300 million-SEK 400 million over the coming quarters? Yeah. As you recall then, we said SEK 200 million-SEK 300 million end of Q1, and now we say SEK 300 million-SEK 400 million. A lot of that was actually related to SW, and we have started to sort out a lot of. The growth that we see now in the SEK 300 million-SEK 400 million is mainly coming from a shift, I would say, from SW into ACT and to some extent also Life Science and here impacting end of Q2. When it comes to what will come back, we see that if you are capable of sorting this out, it should be handled through the rest of the year here. Okay, thank you. The last question from me. I mean, considering the weakness in ACT, is there still some sort of destocking effect at hospitals for, you know, ECMO ventilated consumables as we should have been seeing in Q1 still ongoing for Q2? Or is it mainly component shortages affecting that area? And if it is component shortages, could you perhaps quantify that effect? I would say it's mainly related to component shortages. There is probably some stocking effect as well, but it's very difficult to quantify this. We have only anecdotal evidence of this. I think you should assume that the majority is because of supply chain challenges. How much of this SEK 300 million-SEK 400 million is related to ACT? Well, we don't share a breakdown of this externally. It is, as Lars said, it's moved more towards ACT now in the second quarter than what we saw in the first quarter. It's a very different SEK 300 million we're talking about now compared to Q1. All right. Thank you very much. I'll jump back in the queue. Thank you. Thank you. We have next question from the line of Kristofer Liljeberg-Svensson with Carnegie. Please go ahead. Thank you. I have three questions. First on the working capital, just wonder, have you started to make any payments just for the surgical mesh settlement, or when do you expect this will happen? Also, if you could provide maybe some view on the cash flow here for the second half and the full year, and how much you expect working capital will increase for the full year versus full year 2021. Then on this investigation in Germany, I think you said they've been aware of this since the beginning of the year. I wonder what type of dialogue have you had with FDA and whether you think this will have any impact on the work to settle the consent decree there. Finally, how much higher would operating costs have been in the quarter without release of the bonus provisions? Thank you. Yeah. Okay. Well, we've not made any mesh payments yet. We do expect that to happen in the second half of the year, but we can't predict the exact month today. When it comes to cash flow going forward, it's not something that we give any guidance on. We only talk about the working capital dynamics for the first half year here. When it comes to the investigation in Germany, FDA is informed about this, where there's full transparency also with them. We've had inspections by the FDA in our German sites with good results. They confirmed that we have a compliant quality management system. At this point in time, we don't see any kind of impact on the relationship with FDA because of this. When it comes to the operating cost question, it is a mix. We don't quantify the individual buckets here. It's a mix of variable pay reductions because of the performance. Also we of course try to work with overtime, with shift work, and also being selective when it comes to rehiring and using the natural turnover to make sure that we pace our cost evolution for the year. Would you say that even if adjusting for the bonus provision release, that operating costs would have been down organically year-over-year? We didn't say that. We only said that we don't break it down. I think it would be helpful to understand if your underlying operating costs are trending higher or lower. Yeah. No, I think if you look at it, of course, there is, when it comes to the incentive and bonus payments that we have, they are of course connected to our performance. If we are now performing somewhat weaker, then of course that has an impact. It's not separated from what we do in the business as such. When it comes to the cost level as such, I think there is an underlying increase in some of the costs connected to the travel and marketing costs now coming up from very, very low levels. That is increasing our costs somewhat and also some of the normal, let's say, staff costs and salary costs. That is the moving parts that we have. As Mattias mentioned, we are working diligently to ensure that we take out consultants and also use our natural turnover to manage costs going forward. Do you think operating costs will be down also year over year in the second half of the year? As we say, we don't give guidance on every line in the P&L. We give you top line and a bit on the bottom line. Okay, fair enough. Just to follow up on the mesh settlement payment, would you be willing to give any indication how large those cash flow payments would be? No, I don't think we want that because it's part of a negotiation and the final settlement agreement. We will keep that until we are in full when that is closed. Okay, understood. Thank you. Thank you. Thank you. We have next question from the line of Mattias Vadsten with SEB. Please go ahead. Hi there. Thank you very much. Some already asked, but just looking at the sort of historical performance of the company, we know sort of QoQ development has been some SEK 50 million-SEK 60 million negative going from Q2 to Q3 on adjusted EBITDA. On the other hand, I mean, you've had some significant headwinds for Q2, price increases on raw mats, supply chain issues, delayed deliveries and so forth. Could you just give some flavor and describe the potential for growing earnings sequentially and what the sort of key drivers for this to think of is? I mean, I know of the FX savings, so if you just can keep it sort of organic terms, that would be very helpful. Yeah. I think it's not much more complicated than the fact that we expect a continued recovery in elective surgeries, and most of our elective surgeries are, I mean, margin accretive categories. We expect this to continue and be less overshadowed by other problems in the second half of the year. We expect to continue to improve the performance in Surgical Workflows in general, I would say. As you can see in the report here, we have very good momentum in SW. I think if you take out the vaccine effect from Life Science, that's also a business area that has positive momentum. Of course, we expect to gradually work our way out of this supply restricted situation that we've had now for the first half of this year. These are the main organic levers for better performance in the second half. Maybe the final point would be when it comes to our cardiopulmonary business and ECMO therapy in general, that we expect more of a normal flu season in the second half of the year. If you look at what's going on in the southern hemisphere now when it comes to flu, it is quite severe, and we can also see some of the COVID effects right now as we speak in Europe and in North America, with more people in the intensive care ward. There is those type of dynamics that we expect that will support our business in the second half. That's perfect. Thank you very much for that. If we think about supply chain issues, component shortage, just finding more components ad hoc and so forth, how would you describe that sort of environment in recent weeks versus what you saw sort of end of Q1, beginning of Q2? Can you just give some flavor there? I mean, it's shifted a bit since Q1. We were somewhat positive towards the end of the first quarter and we could see some light in the tunnel when it came to Surgical Workflows, and I think this has materialized while the situation is better. There's been some new challenges mostly related to Acute Care Therapies, mostly to Life Science. We do believe that it's possible to work through this within this year as well. I can't say that the situation. It's not getting any worse, but it's also not improving a lot. It will require quite a lot of intense work here in the coming weeks and months. Thank you very much. Thank you. Thank you. Thank you. We have next question from the line of Victor Forssell with Nordea. Please go ahead. Yeah, thanks a lot for taking the questions. I'll rephrase some of the earlier ones here as well. If you look at the second half now, it seems as the H2 margins will exceed last year's for you to reach those 100 to 200 basis points down year-over-year. Comparing it to, you know, we've seen last year, if I recall it correctly, ECMO had a decent Q3. Now ACT had quite poor gross margins. Also in Life Science, you had perhaps better deliveries of beta bags than you foreseen the second half now, as a relative share of your Life Science sales. I mean, if you could in qualitative terms, please, on a divisional level, talk a little bit about the bridge here, that would be helpful. Yeah, I don't know that I've made one attempt at this. I don't know that I can color this much more. I mean, Lars, do you have anything to add to- No, I think, as we mentioned here, in Q2, we have supply chain disturbance, and that is, of course, not only holding back sales and deliveries, it's also creating the under absorption in our factories. When that stabilizes, that would, of course, also as a general comment, support better going into the second half of the year. Then with the growth we then have in the expectations here, we will have a somewhat better also product mix support with higher sales of elective and also higher sales of cardiopulmonary supporting that et cetera. It's supported by the product mix as well going into the second half. Okay. I mean, just to help out a little bit on the gross margin side, how, in what sort of magnitude would you classify all these headwinds, starting with the largest headwind and on ACT and Life Science primarily, if you just, in qualitative terms can explain what drove the worst performance? No, I think we tried to show that in the Getinge margin bridge there, where volumes of course also the BA mix, but factory absorption hurting us and supply chain issues together. Those should support us also then, when they are. Being handled during the second half of the year. Okay, fair enough. Just lastly on the headwinds you've had on ventilators and on COVID sales regarding Life Science. Can you sort of give us an indication of what that was year-over-year here in Q2 in units sold for ventilators, for example, and also the beta Bag sales year-over-year? No, I think, as I said, there was an improvement in June for all our intake. Ventilators was part of that. We don't break it down into the number of units. We still have a forecast of 8,000 units for the full year, and I think the performance so far is in line with expectations, so we have no reason to change our view on this. When it comes to beta Bags, we have rather good visibility with longer contracts as well, but I really can't add any more detail to the evolution. Sorry, just a follow-up on the critical care ventilator side. I guess in conjunction with the revised outlook you had one month ago, you said that the trajectory on ventilators were a bit slower than expectations. Has that reversed here in June then? Is that how we should read it? No, you should read it. I mean, a normal year of ventilators is about 10,000 machines for us. The assumption going into this year was a normal year, possibly with a little bit of a mix between machines and service and the part of the connected offering and so on. What we're saying now is that it's at the lower end of this, that's the only change. Okay, thanks a lot. Thank you. Thank you. We have next question from the line of Patrik Ling with DNB. Please go ahead. Thank you. Maybe I can start with just a short follow-up on the last question. When it comes to the beta Bags, could you be a little bit more specific on how much that is just related to the COVID vaccine sale that you talked about in connection with the profit warning? How much of the headwind comes from the vaccine side? It is, of course. I think it's what we say when it comes to the pandemic impact. It is impacting BetaBags, yes, it's impacting the weak flu season in the first half of the year on cardiopulmonary, and then of course to some extent there it for the ventilators. That was sort of, say, the main impact here that we highlighted when we did the profit. You do not want to give us some sort of feeling for how the year-over-year effect of just COVID vaccine, because that is something that's, you know, not really related to ACT, it's more related to Life Science only. Yeah. No, it's not that we don't want to. It's difficult to assess as well. I mean, there's been a significant slowdown that we could see here in the beginning of the year. What it will look like now going forward, it's difficult to predict. It's also the vaccine decrease is also offset by the production of, you know, non-vaccine related products. This dynamic is just very difficult to predict, so we can't share anything externally about it. Okay, great. I'll settle for that. Maybe I just missed it when you talked about it, but this investigation in Germany, could you just give a little bit more detail exactly what you're looking for, and whether this is related to historical issues or if this is something that has, you know, popped up during the last couple of months or quarters or years? No, this is an ongoing investigation. We cannot really give any more information than we have here. I think we've mentioned on one of the other questions here that if you look at the overall remediation work that's been going on in our German factories, this has been subject to third-party inspections. These third-party inspections have verified that our QMS quality management system is compliant. They've not identified the shortcomings that are now subject to investigation. We will, of course, continue with the training, education, and the follow-up to make sure our new quality management system is applied correctly in the day-to-day operations with the higher priority. We really can't give any more information as this is an ongoing investigation. We felt that we wanted. We have no obligation to disclose this. Now, we felt that we wanted to be transparent since we had concluded our own internal investigation. We can't give any more information at this current time, and we cannot give any assessment of the potential impact either at this point. When you say that you have had third-party inspections that hasn't identified this before, should we read that as this is something that has popped up? Or, I mean, that this is a more recent problem than rather a historical problem? No, it's not a conclusion you can make from this. I prefer not to comment on this. Okay. Do you have any timeline for what will happen before we know anything about it? No, unfortunately not. The timeline is out of our hands. This is an investigation now led by the public prosecutors in Baden-Baden. It's not something we have an impact. We can only cooperate with it. Okay. You say that it's also a investigation into former management. How long ago did these persons or person become former? When did they leave the- I didn't say former management. We said the former and current employees of the Sorry. We cannot disclose any details on the individuals subject to investigation. Okay. Then my last question, just had a short question on you talked about your sustainable investment in climate neutral gas. Is that in Germany and will that be, you know, setting you up for some sort of Russian exposure that whether the Russians cut the gas supplies to Germany? Yeah. Just wanna highlight that we were reliant on gas already before. It just wasn't climate neutral. We are installing solar panels in our Rastatt factory as well to offset some of these effects. It's not any increased exposure that we'll be working on. I can also mention that we are working on contingency plans to handle any disruptions in the German gas supply system or short-term interruptions. Okay. Okay, great. Thank you. Thank you. We have next question from the line of Rickard Anderkrans with Handelsbanken. Please go ahead. All right. Thank you for taking my questions. First one, order backlog, adjusted for currencies were 21% higher year-over-year in Q1. What's that figure now ending Q2? It is somewhat higher. Okay. A few percentage points higher or is that a fair assumption? Yeah. Great. Thank you. Can you talk a little bit more, you have increased the inventories obviously here. Can you talk a bit, you know, about the visibility on access to critical components and access to hospitals for deliveries in H2? Would be interesting to just get a sense of how comfortable you feel with you know the path forward of delivering on this backlog and the orders coming in there. Yeah. I think it is still a challenging situation, no question about that, but it's not getting any worse. If anything, we are getting a little bit better visibility, but that's probably the best guidance we can give now. Right now we feel confident that what's on the order book or what is on backorder that has been delayed in the second quarter, we will be able to deliver in the second half of this year. All right. Great. Just final one. You know, could you help us navigate how you are thinking internally about the impacts from the most recent Omicron wave that's sort of picking up in North America and Europe, et cetera, in terms of, you know, ICU utilization, vaccine boosters, elective impacts, et cetera. Would be interesting if you're sort of taking any action on that internally or seeing any change in order patterns or asks. Yeah, well, if I answer the latter part of your question, beginning we saw a change in order pattern in June with a slight pickup in ventilators, for example. So that's one small piece of information when it comes to the evolving landscape here. Otherwise, I would say that it's a very difficult to predict situation going forward. We can see now that the ICU capacity in some countries is being stretched again. We certainly follow the dialogues when it comes to vaccine boosters and so on. But it's very difficult for us to predict in numbers now what that will mean for the second half of the year. When it comes to the flu season in general as well, we can see if you look at Australia, for example, it's been a very difficult situation when it comes to the flu and all the planning is in full swing when it comes to the northern hemisphere second half of this year as well. We believe it will be a normal flu season that will have an impact on how ventilators are used. It will also have an impact on ECMO therapy. To put numbers on this at this point is very difficult. Fair enough. Thank you for taking my questions. Thank you. Thank you. We have next question from the line of David Adlington with J.P. Morgan. Please go ahead. Hey, guys. Just sort of slightly bigger picture question to start off with. We've got H1 sales down about 7%, orders down 4.7. I know the second half is significantly easier in terms of comps, but maybe can you just sort of map out how we get to that sort of flat for the year, 'cause that obviously requires a big rebound. Maybe the phasing between Q3 and Q4, and particularly given those orders down 4.7%, what sort of visibility you have on that return to growth? Then just as a follow-up, I was quite surprised to see recurring revenues down 5.4%. Was that driven by the supply chain issues or was there a demand impact there as well? Thanks. Yeah. If If we look at the dynamic between the first half and the second half, I think we've covered most of the variables here in different form earlier. You point yourself to the weaker comps in Q3 and Q4. That's one factor of course. Then you have everything with the recovery of the elective surgeries. We can really see that there is a pent-up demand when it comes to this. We need to resolve some of the supply chain bottlenecks that we have here, which we are confident we will do in the second half. Flu season normality is another factor that we feel confident about now in all the dialogues that we have with our customers. Those are the main effects, I would say. Vaccine is difficult to guess, but even if you take vaccine out of the equation, there is a good underlying demand for non-vaccine related production that is positive for our sterile transfer business, that is positive for the bioreactor business and so on. With everything that we know today, we feel confident with the guidance that we gave here in June and that we reiterate today. On your question on recurring there, the lower sales, it is mainly related to the ECMO disposables that is impacting. The weak flu season that we mentioned is also here impacting Q2. Great. Thank you. Thank you. Thank you. As there are no further questions, I'd now like to turn the call back over to Mattias Perjos for any closing comments. Over to you, sir. Good. Thank you very much, operator, and thanks everyone for listening in today. I think we already made the summary before we moved to the Q&A, so nothing to add there. Wish everyone a good rest of the day. Thank you very much.