Ladies and gentlemen, welcome to the Knowit Interim Report Q3 2024 conference call. I'm Vicky, the call's call operator. I would like to remind you that all participants will be in listen-only mode, and the conference is being recorded. The presentation will be followed by a Q&A session. You can register for questions at any time by pressing star and one on your telephone. For operator assistance, please press star and zero. The conference must not be recorded for publication or broadcast. At this time, it's my pleasure to hand over to Per Wallentin, CEO. Please go ahead, sir. Thank you, and with me today, I also have Marie Björklund, but we'll talk a little bit later, and first, I would like to take you through some operational highlights during the third quarter. In our largest business area, Solutions, we are happy to deliver a continuous positive trend in utilization, and in addition to that, the EBITDA margin improved for the second quarter in a row. This is mainly a result of our cost reductions and organizational changes. The market is still uncertain with long sales cycles. After summer, the market had a slow start, with projects starting up later than normal, particularly in Experience and Insight. In Norway, we have continued to develop our strong partnership with several customers, creating a very stable foundation during the quarter. In Sweden, we still meet the largest challenges, although we see some improvements in certain segments. Finland and Denmark are developing strong in some areas, but we still need to work more to reach a stable ground in others. We can take the next slide, please, and take a look at our business areas in more detail, starting with Solutions, our largest business area, reporting net sales of SEK 750 million for the quarter. The EBITDA margin increased to 8.1%, a nd as I said, we are happy to see that utilization are slowly improving. The geographical differences remains. In Finland, we outperform the market. We still have challenges in Sweden and Denmark, and in Norway, we have a continuous strong client relationships, and a really good platform to work with. Our efforts to optimize the organization and reduce costs pays off, but it's yet too soon to say that we see a broad market recovery. Next slide, please. Going over to our digital agency, Experience, reported net sales of SEK 235 million in the quarter. The business area had a very tough quarter with negative results due to slow start after summer, of course, affecting the utilization a lot. Sweden and Denmark are the most difficult markets, where we continue to take action to improve profitability. We have a strong inflow of requests from clients, but the competition is or remains fierce, and clients take time to decide upon new investments. We can take the next slide, please. Business area Connectivity reported sales of around SEK 190 million for the third quarter. EBITDA margin slightly below last year at 11.3%. Our ability to adapt quickly to market changes have been a strength during this recession, and we also have long projects in Connectivity, making it easier to handle a start after the summer. We are in a competitive market, but we still continue to recruit at a controlled pace. We have a solid position in the industry segment, a key to be able to continue to deliver strong results despite the current market weakness. We continue to maintain a strong focus on sales. We have increased sales capacity and ensured utilization rates at a good level. Moving over to... Next slide, please. Moving over to our management consultancy, Knowit Insight, reporting sales of around SEK 160 million for the third quarter. The business area reported a loss in line with the same quarter last year. Just like Experience, the start after summer was very slow, with projects being delayed into the end of the quarter, and this, of course, have impacted both utilization and margins. Our position in cybersecurity and legal remains strong, and we have had a net recruitment in the quarter. We work hard to develop and strengthen our offerings with defense, launching highly appreciated training programs on for employees to prepare for possible assignments in the industry, the quarters to come. With that, next slide, and with that, I hand over to you, Marie, going through some financials. Thank you, Per. We can take the next slide. So back to the group as a whole, we delivered sales of approximately SEK 1.3 billion, a decrease of 14%. There is a positive calendar effect for the quarter of around eight hours, but due to the timing of these extra hours during vacation, there is no effect on the revenue or EBITDA. We are around 10% less employees, of course, affecting revenue, but besides that, the revenue from sub-consultants is less than Q3 2023. The adjusted EBITDA amounted to SEK 57.9 million for the quarter, a decrease compared to the same quarter last year. This leads to an adjusted EBITDA margin of 4.4% in the quarter. Last year, it was 4.9%, so it's slightly down. We do have some layoffs this quarter, as well as restructuring costs, but far less than both Q2 this year and Q3 2023, and we now consider it at a level where we see it as a normal course of business. We also managed to keep savings on a good level, but we are now meeting comparable figures on Q3 2023, which also included savings. Cost awareness is still high up on the agenda for the quarters to come. We see that the market is still challenging, even though we see signs of improvement, especially in solutions and connectivity. Competition is tough. Prices are under pressure, but still above the level of last year. Salary revision have been kept at our expected and desired level. Next slide, please. This slide shows the development over time and also on a rolling 12-month basis. Our adjusted EBITDA for the latest 12 months is at SEK 436 million, and revenues at SEK 6.6 billion at an EBITDA margin of 6.6%. We note that the adjusted EBITDA margin improved compared to Q1 this year and are in line with Q2. In other words, we do have a trend of stabilizing results. Next slide, please. This is an overview of our net debt development. We have SEK 600 million in used credit facility, and we have a total credit facility granted of SEK 1.05 billion. Future considerations amount to 26, and other liabilities, mainly leasing debts, amounts to SEK 524 million affected by amortization. This totals a net debt of SEK 792 million, and divided with our EBITDA of 582 on a rolling 12-month basis, we are at a leverage of 1.4%. We have a stable balance sheet and a good financial position. Also, this means that we are well within our financial target, which is set not to exceed two. Next slide, please. We have a solid platform and a strong position as a digitalization partner in the Nordic region. The share from the public sector has decreased compared to last year, following a significantly softer demand in some areas compared to a year ago. The demand within defense continued to be strong. We have a strong and solid position in the industry sector, allowing us to grow despite challenging market conditions, and our retail share has gone up also, and we see an increased demand from certain customers. Clients remain focused on business-critical projects, also in an economic downturn, and with that, I leave it back to you, Per. Next slide, please. Thank you, Marie. Well, to summarize, we see a positive trend in our largest business area Solutions with both utilization and margin improving. Competition is high in all areas. Our top priority continuously is to remain highly focused on sales and client relations. Sweden and Denmark are the most challenging markets and require further cost control and efficiency. W e are proud to have a strong position as a Nordic partner in the digital transition. We are in good shape for the growth when the market improves. W ith that, I open up for questions. Thank you. We will now begin the question-and-answer session. Anyone who wishes to ask a question may press star and one on their telephone. You will hear a tone to confirm that you have entered the queue. If you wish to remove yourself from the question queue, you may press star, then two. Questioners on the phone are requested to disable the loudspeaker mode while asking a question. Anyone who has a question may press star and one at this time. The first question is from Jesper Stuer-Lauridsen, Handelsbanken. Please go ahead. Yes. Good morning, Per and Marie. Jesper Stuer-Lauridsen here. A few questions from me, if I may. I was thinking around the stabilized trend and slightly improving utilization trend here in Solutions. I read into this that this is an improvement from Q2, so sequentially, or do you also see this as an year-over-year improvement in the utilization rate here? Hello, Jesper. Well, the answer to your question there is that we started to see the improvement in the second quarter in solutions. It has continued in the third quarter, and when we compare it to the same quarter last year, we also have an improvement for solutions, so there is a positive trend there. All right, thank you, and on the slight weaker segment, Experience and Insight, what kind of tools do you think you have to further reduce internal costs, o r is it more about additional layoffs to secure margins and match the supply with demand, and if so, is it more in Sweden and Denmark, or what's the mix here between the regions? I think that the weak market that we have in Sweden is of course challenging, especially for Experience. We see that at our competitors as well. I think that we have done quite a lot of things. We now have a really high focus on sales and sales activities and trying to close deals. We continuously increase the efficiency in Experience. For example, just after summer, we consolidated a couple of companies, subsidiaries within Experience in Sweden. We are on that task as we speak. Yeah, and I can just agree with that and say that we've done a lot of things in experience also in the second quarter, and I don't think that we have quite seen the effects of that yet, so there's a full focus on sales, and also, of course, cost savings. All right, great. Thank you. O n the new framework agreement you announced here a few weeks back in Norway, the framework around NOK 3.5 billion over four years, do you have any estimates here how much this could contribute for you? I think it's additional two to six partners included here, a nd yeah, do you expect an uptake from this already here in Q4? It's not really said how much we will benefit from that, but it was NOK 3.5, as you said, and it's over four years. A good guess could be that something around 20-25 of that would be beneficial for us, b ut we are not really certain of that figure yet, but that would be a good estimate. All right. Thank you, and looking at the calendar effects here for Q4, it looks to be a slight headwind, around eight hours less, and do you have any estimates how much this could impact the results for Q4? Yeah, you're right. Actually, we don't really know how that will affect. It's always very uncertain how December is affecting, and especially now, when there's an economic downturn, we've seen that there's a slower start after summer. It might be, if this continues, that there's a slower end of the quarter. So I don't actually have an amount to give there. But yes, it's true. In total, it's not as much as eight, but a little less than that headwind. Okay, okay, perfect. Thank you for that, Per, Marie. I jump back in line here. Thank you. The next question is from Daniel Thorsson, ABG. Please go ahead. Yes, thank you very much. I have a question on the net recruitment here on group level. When in time do you think we may be back on positive net recruitment? Again, what's kind of your internal plans here on timing? I think that our focus right now is to optimize the margin and have a strong focus on that. When time comes, we know that the market has changed a little bit, and then we will start to net recruit. I don't have any estimates connected to that. It doesn't sound like very near term, at least. No, we haven't said anything about the net recruitment. We do see a possibility to recruit, especially in connectivity and in solutions, obviously, since the utilization is going up. But, I would like to say that if you look back on recessions over time, the last 20 years or so, it's almost always been quite, when the recovery comes, it's usually quite fast, but it needs to come. Yeah. I see, and then if I heard correctly here, you said that you were in positive net recruitment in Insight in Q3, and if that was right, is that a sign that the segment ended on a higher note and that the outlook for Q4 and 2025 looks somewhat more optimistic? Is that right to think about it? I would say that I don't think that we have any chance of having a more positive net recruitment in Insight in 2025 than the other business areas. On the contrary, I would like to highlight Solutions and Connectivity due to their margins and the trends that we see right now. But it is true that the Connectivity is the business area recruiting most in the third quarter, and that is mainly within cybersecurity and- Insight, right? Yeah, insight. Yeah. Sorry, yeah. Yeah. Yes, in Insight, Yeah. In cybersecurity, and where we can see that we can utilize consultants. Okay, that's, that's good. T hen just thinking about the potential margin here in 2025, I mean, given that the market is tough, price pressure likely to continue for a while, that should limit the margin. But you also see utilization rates already now bottoming out or stabilizing in the solutions. How should we think about the reasonable margin assumption in 2025? Not a specific number, but the trend should be upwards, but not as good as in 2022, 2023, obviously. How should we think about that potential? It's of course very difficult to say. We're not sure when the market will turn, but for Solutions, definitely we see the positive trend, but then Experience, we have the trend in the other direction. It's difficult to say, but of course, we're hoping to have a better margin than this year. That much I can say. Let's come back to that when we see a stabilization in Experience as well, because that will, of course, be quite important to reach. Yeah, I see. T hen on the further potential cost reductions, are you planning to close any offices or to exit any local markets or anything like that? No. No. No. I think that we are doing quite a lot connected to consolidation of subsidiaries, changing business models in some areas, and of course, reduce capacity in other areas. So we do and have done really big changes in some areas, b ut the markets that we are at are really good to be part of even the smaller markets in Sweden. Yeah. I see. T hen a final question on hourly prices here. On a group level, could you kind of estimate what the hourly price change year- over- year was here in Q3? I guess it was slightly negative, but do you have any better feeling for that? It's the price development is actually slightly positive. We see the price pressure, but we are able to have increased prices when you compare it to the same quarter last year. Okay. Okay, that's fair. Thank you very much. The next question is from Raymond Ke, Nordea. Please go ahead. Hi, Per and Marie. Can you hear me? Yes. Yes. Hi. Hi, good morning. Two questions for me. First one, a peer reporting earlier this week said, they saw no improvement in the public sector, but you're saying you're seeing early signs of recovery in solutions. Curious, could you provide some more color into why you think that is and what you're seeing differently from your peer, maybe here? On the industry share, we see that the public sector has gone down. I would say that the fact that solution has a positive trend in utilization is not due to the market. It's due to our measures, the sales focus, the cost savings, and the efficiency. I would say it's more that than the public sector increasing their demand in total. All right, very clear. T hen on connectivity, demand there is holding up relatively well. Do you see the underlying market sort of turning tougher ahead or anything due to its sort of cyclical nature, I'm thinking, or how should we think about that? We have already seen a little bit tougher market in connectivity as well. I think that we've been good in handling that, getting into new areas, for example, a little bit less in telco and increasing in the industry segment, so we foresee a tough market connected to connectivity as well for a while, but I think that we take some measures to handle that. Okay, excellent. Thank you very much. All for me. Thank you. As a reminder, if you wish to register for questions, please press star and one on your telephone. At the moment, there are no questions from the phone. All right. We have a couple of questions from the webcast. First, coming from Einar Romsås at Eika Asset Management: How is monthly utilization relative to last year for the months in the quarter? Is it slow start from back to work, leading to the subdued top line this quarter? It's a slow start back to work after summer, so as we talked about. Second question from Ulf Huss at HCAP: What is the status and expectations on increased public budgets for spending on consultants in Sweden? How is Stockholm evolving in the quarter? A s we talked about now for, I think it's more than two years, that we had lower budgets in public sector 2023, and even lower 2024 than 2022. We expect increased budgets due to that the inflation is down, for 2025, and that's what we see, especially in talking about Sweden now. But, we don't know how that will affect our business, in detail yet. It's not presented. I mean, we have a budget as a total in Sweden, but we don't know where those money are going. You could expect that some of them are going to the defense industry and civil defense, et cetera, and that's good because we are part of that. I think that it will increase in 2025. I also think that when they get new money, it's not gonna be a really first of January start in 2025. It will be a slow start in the first quarters b ut we have a good platform to continuously do really good things at our customers in public sector in Sweden as well. I think that we are performing really well or overperforming in public sector, for example, in Norway. So even if there is slow budgets there as well, we have been able to take so many new framework agreements, so that's not a problem in Norway. Concerning the question you had about Stockholm, I mean, w e disclosed that we are having challenges mainly in Sweden, and that involves Stockholm as well. So, the competition is fierce in Stockholm, so there is a challenge. Stockholm is a lot about public sector as well. Yes. Great. O ne more question from Tor Egil Skulstad at Grete Invest AS. How large is the revenue from defense a nd can you give any color on how you are... Sorry about the hesitation. I'm translating from Norwegian. How you are focusing on that sector? It's less than 5%, so it's not that big, but it's increasing, and as I talked a little bit about, we are actually investing money now in and have done that for a while to move people from other sectors into the defense industry, and it takes some time because there's a lot of regulations in that industry. So technical competence from somewhere else, and then add on industry competence in the defense industry, and we also see that we are growing both connected to public sector and defense, and some private sector customers, mainly in Sweden. We also have one or two of those agreements in Norway as well, but mainly in Sweden. So, from a quite small level, we will continue to grow in that area a nd I think that we have a really good platform to do that. Great. There are no further questions from the webcast. All right. Thank you for listening in, and have a good continuous good Friday. Thank you.