Welcome to the NIBE Q1 presentation for 2025. During the Q&A session, participants are able to ask questions by dialing pound key five on their telephone keypad. Now, I will hand the conference over to CEO Eric Lindquist and CFO Hans Backman. Please go ahead. Thank you very much. Good morning, everyone out there. Good morning. Good morning. It's a gorgeous day here in Markaryd, Graduation Day, we call it, and we have the annual shareholders' meeting later on today. We will use our regular pattern: we start to go through the report, Hans and I, and then we allow for questions. Due to, you know, all other things that we have to participate and carry out today, we would appreciate if we could stop around noon. That gives us an hour in total. Limiting the questions to two per person. Yeah, that's right. Thank you, Hans. The headline we would like to say is pretty much in line with our own expectations. That's Q1. There are signs of recovery, and somewhat, of course, still cautious market. Already at the end of Q4 last year, we saw a change, and that continues, and that fills us with, you know, positivism, of course. Our action program is in place, and that makes us return to a more traditional seasonal pattern as well, because now the large orders that we had for years, they are pretty much gone, and now it's back to an ordinary pattern. What's also very pleasing is that the inventories in the distribution chain, they have come down. We call it more acceptable levels rather than saying that they are ideal levels. We can't really judge that, but we now see that the end customer's demand is so much better reflected at the manufacturer's levels, which has been a difficult situation for all manufacturers in our three different industries. That is always difficult to assess naturally the future with its economic and political uncertainties, but we believe in a continued recovery and the strength we represent ourselves. We have come down considerably in interest rates, and there's a debate whether that possibly could continue to go down. Of course, we also like to say that we are a different company today than we were a few years ago. We have a different range of products. They have been kept at a steady pace when it comes to continuing to develop them. We haven't cut down there. Also on the production engineering side, we have more rational production. Of course, the facilities that we talked so much about, that's now coming to an end. That is investment in just this quarter. We finalized a factory in Finland, and as late as yesterday, we opened up our new market center, we can call it the NIBE World of Energy. Today, later on, we're going to have the annual shareholders' meeting in a factory that's newly erected, producing tanks. That is also being opened up here in a few weeks' time for the shareholders to look at. That is pretty much the summary, and of course, our ambition with that said is still there to try to come back to a margin situation for all three business areas within the historical span, we can call it. That is a summary, and if we don't jump very quickly into the figures, I mean, that speaks for themselves. It's a modest growth, and it's particularly on the climate solution side where we have the growth, which is very pleasing. Stoves, that's very pronounced a seasonal pattern where you have the significant increase during the second half of the year. Of course, the operating margin is up quite a bit from the previous year, which was not very pleasing to us. We are going in the right direction when it comes to that. That's all illustrated in the graph that's coming up here with the bars indicating that there is a slight change in the curve in the direction, which is pleasing to see. If we just swing to the profitability part of it, they are thinking in the future we're going to switch over to having the EBIT here. We also have the financial items, and we see that, of course, relatively easy quarters to compare ourselves to, but there's also a change. As the quarters are going to go by now, we're going to see us returning to a more seasonal traditional pattern. Having a few words then about climate solutions, improved underlying demand here in Europe, particularly in Holland, Sweden, Germany, in America or North America, it's stable. There isn't any real growth to talk about. Also here, we see a more traditional seasonal pattern. Yeah, inventory levels, of course, it's the same thing for all three business areas. It's come down to a much, much better level. On the commercial side, which is not as big as we would like it to be, but there is another resilience in that segment. Overall, we believe in a gradual improvement going forward. Of course, the ambition here is to be back on the operating margin within our historical range, as we're going to show in a little while here. Those are the figures. Operating margin is still below 10%, and of course, we are striving to be up at our traditional span there between 13%-15%. That's an undertaking, and we are not wavering on that or shivering or anything like that on that target. Ambitions are ambitions, and the world is as it is, but that's a very clear target. On the element side, that's a varying demand, of course, depending on which industry we look at. Some are very buoyant, like the semiconductor and rail. Rail continues to be very positive since there is a very obvious change in attitude. People used rail much more, and also for cargo, means that the railroad systems and the trains themselves, they have to be climatized and heated, and obviously the rail itself. In the industrial segment, a little bit weaker. Also here, of course, inventory levels among our customers is also a reflection of the element itself. On the heat pump and white goods side, it's a slightly deferred cycle, whereas the ready-made goods at our customers, they have come down to acceptable levels. Of course, the components that they also bought prior to the downturn, they're not totally emptied yet. That is why we have a certain delay in the improvement there. Low construction in, yeah, you can say overall, there isn't any booming construction industry, and I think that's a concern to at least the whole Europe. The thing is, of course, that we need to come back, but that is a political or financial decision by banks to arrive at lower interest rates. Also, here to be back at the historical range, 8-11. As we see here now, we are taking a small step up from last year up to 6.2. We are going to continue as before, put down our hats and go ahead. Finally, stoves, again, very pronounced seasonality, and we have really taken a lot of activities when it comes to marketing, knowing that the market will remain relatively slow. Also on the production side, you have to prepare yourself for the peak during the fall, but then you have to be very alert so you do not come into the next year with overcapacity, meaning that we have to have some temporary people employed to guarantee the volume during the fall. If the demand weakens a little bit again, if we are back to the seasonal pattern, we have to have them, you know, going back to whatever they did before, not to harm the margin that first half year, next year. Here you see the figures, and of course, it is a drop in revenue, but despite that, we have been able to almost maintain the operating profit, but foremost the operating margin, which I think illustrates a strength by the business area. Here we see a difference between North America and Europe. Europe here has been relatively seen weaker than North America, which is, of course, also filling us with, you know, prosperity when it comes to the rest of the year. Having a few, yeah, the usual pie charts that I present before I hand over to Hans is pretty much the same, where Climate Solutions is roughly not two-thirds here, but 61%, and Element just south of 30%, and Stoves around 10%. That's been pretty much the same. Now the profitability, of course, extends Climate Solutions position into the 71%, and Element 23% and 6% respectively, remembering now that Stoves particularly will have their strong period during the second half of the year. Geographically, North America is about a third. The northern part, so northern countries, we are like less than 20% anymore, and the rest of Europe is like 43%. No dramatic changes really, but North America plays a big role. We know that there has been a big debate about customs and things like that. As we say in the report, it is not so sensitive when it comes to customs as someone would have thought, because our expansion has been built around acquisition in the past, and of course, also growth from those platforms. We have a very small export from Europe to North America and the other direction as well. From that point of sense, we are fairly, you know, robust, we can say. Just a few words about that. Hans, I think I have got 12 minutes. Perfect. Thank you. I will continue with the same speed to leave room for questions. A little bit of a deep dive into the business areas and then a few snapshots on the balance sheet and some key numbers. Climate Solutions then again, I mean, here we grew, as Eric said, with some 3+% landing in sales, just about SEK 6 billion. We had a little bit of boost at the end of the quarter, you can say. This is a true growth in the sense that it's neither been supported by acquisitions nor currency. It was relatively, well, flat there in terms of support. Having said that, the currency was helping us in the two first months, and then of course, it switched when the Swedish krona took off in March. Going forward, we see probably some headwind from the Swedish currency. Nevertheless, we do see an underlying better demand driving this growth, and where the commercial segment, as Eric mentioned, has been more robust during a slightly tougher period. We remain with the targets that also Eric mentioned of returning to our historical margin intervals. What has developed quite nicely here due to the volume growth we've had and also the savings program that we've taken is that the gross margin now has picked up from 31.2% up to about 32%. On the SG&A side, we've also reduced quite a lot, of course, and that's the reason now for the growth in profit here with some 67% and landing in an operating margin here of 9.2%. In climate solutions, I mean, we have a seasonal pattern as well where Q1 and Q2 is one phase of the year where we typically build inventory and prepare for the second half. In the second half, that's really when margins kick in at another level, so to speak. If we just take a quick, quick look at the geographical distribution of sales, one quarter is in North America and roughly 75% in Europe. No major change from the way it looked a year ago. Heading into NIBE Element, I mean, within NIBE Element, we grew with 6.5%, of which a smaller portion came from acquisitions, and in this case, a small portion also from a positive currency effect. Just as for climate solutions, we do not see that the currency will help us going forward the way the Swedish krona is developing right now. Here, we definitely strive towards the goal of returning to the historical margins. We made progress here as well. If we look at the gross margin, it has come up from 18.6%- 20.2%. That is quite an achievement during this phase. Also on the SG&A side, following the savings program and the actions we took there, the operating profit has grown by some 31% and landed in an operating margin of 6.2%, up from 5.1%. It is obviously not where we want to be, but it is a good step in the right direction to where we then want to be. The geographical distribution of sales, no major changes at all compared to last year. It's our most global business area, as we typically mention, with a large portion in North America, some 40+%, Europe and the Nordics being together slightly bigger, but then also with a good portion mainly in Asia. Moving on to stoves, within stoves, sales actually dropped by some 12%, mainly as a result of the low level of new construction and renovation that we've seen. We have also returned to a more traditional seasonal pattern in this business area, meaning that here, more pronounced than in the other business areas, the first half of the year is typically rather weak, and then almost everything happens in the second half. This was not the case for a couple of years following the pandemic when people were at home renovating their homes, and then when Putin invaded Ukraine and people wanted a stove as a second heating source. We're away from that or those phases, you can say, and now coming back to this traditional pattern. As Eric mentioned, I mean, despite this quite, you know, steep drop in sales in a way, gross margin has improved, come up 2 percentage units. And on the SG&A side, we've also held on to costs or even reduced them, meaning that we've been able to land an operating profit almost the same as last year, but an operating margin that is actually higher. I think we're well positioned here for the second half of the year, so to speak. Also here, in terms of the geographical distribution of sales, no major changes have taken place. It's the same picture as before. The North American operations being some 38%, they've actually grown a little bit compared to last year, and they have also shown a better resilience and a stronger performance than the European side. It is North America and it is Europe, including the Nordics, where we are active with this business area. Moving into the balance sheet and cash flow and so forth, there are no major changes here. I mean, the total assets, total liabilities have come down from some SEK 70 billion -SEK 66 billion from year-end up till now. There is a portion of, or a good portion, you can say, of a currency conversion effect in there, but we've also amortized loans. Of course, depreciation has continued as normal. Also as a consequence of the savings program, some projects have been written down or written off and taken off the balance sheet, so to speak. If we look at the cash flow, we generated SEK 658 million compared to a large minus number from last year, - SEK 318 million. A lot of that has disappeared, so to speak, in changing working capital. Beneath that number actually lies a continued reduction of inventory. I mentioned before that we typically build inventory during the first half of the year. Here we have really continued our focus on reducing inventory as much as we can, both on the component side and on finished goods sides. That has been successful. Also, the payables have actually increased, meaning they have contributed well. The sole effect for this negative change comes from accounts receivables. We have not changed any payment terms that would not be in our benefit, so to speak. Do not have any overdues more than, you know, before, and we have very few of those. This is more of a timing issue. We had this boost of sales at the end of the quarter, which I mentioned. Yeah, it is very much related to a phasing of those receivables. We have continued to invest in our operations. That might stick out a little, SEK 619 million compared to SEK 470 million. We have not launched any major, larger, or new investment programs. This is all linked to the very large program that we launched some five years ago now. This is also a phasing question of factories now being completed. We have done the last bits and pieces in Markaryd, where we are standing right now. Also in Finland, we have completed a factory. It is all in line with this program. Financing activities, I mean, we've also amortized some loans, but then there is an exchange rate effect in the working or in the cash flow that hits us as a consequence of that. Working capital is not really where we want it to be. It's coming down. I mean, it's at 22.7%. We have as a midterm target, so to speak, to bring it down below 20% as a first step, and then of course go below that as well. We're on our way, but would also benefit, of course, from a more buoyant market or vivid market, so to speak. As a consequence, I mean, we're moving in the right direction, but with still a slightly challenging market. Key financial numbers are obviously not where we want them to be, but definitely now heading in the right direction. I see now when I look at the picture there, that the little star that we have on the two first key numbers there, return on capital employed and return on equity, is not in for 2025. They should be there. The numbers have been adjusted for the savings program, for items affecting comparability, so that we compare apples with apples. I mean, all in all, I would say we're very well positioned. Obviously, we're not exactly where we want to be in terms of numbers, but still landing in the 9.2 at climate is not too bad, if I dare to say. We're foremost well positioned for what is to come. We have made some investments over the years now, and I think you can give some color on that on the coming pages, Eric. Yeah, by all means. We have very, shall I say, professional photographers around our companies. The first picture here is an illustration of yesterday when we opened up the World of Energy here in Markaryd. There, of course, was a very, very important happening here because the building itself is very extraordinary for customers to visit us and installers, wholesalers, house builders, specifiers, but also for training, naturally, and meeting our suppliers and meeting all categories of people, giving it a statement that we believe in the future. This is where things happen. NIBE World of Energy has a double meaning. Of course, we are into the energy sector, but also we are filled with energy to move forward. Here we have the, what's it called? County, what was it? What did they call her? The county, something, I tried to county governor. County Governor. That's right. Yeah. [Foreign language] Maria Arnholm. And you know, in Sweden, we have like counties, and she is the highest principal you can call for that district, being an arm for the king, actually, historically. And she called this the crown in the jewel. And she gave a very nice speech, touching. And on the picture below, the slide below, you see the number of people standing in front of her just before we cut the ribbon. And just another slide that also illustrates that we have not slowed down whatsoever in our activities at the big ISH show in Germany. We are all represented by our biggest or bigger brands, and NIBE, of course, and Alpha Innotec and Värmekabel, and also Ross on the commercial side. And railroad, of course, it's going on, and there is hope. I mean, we are not responsible for the railroad system, but we can just say that the investment's coming up. Sit still, be angry when your train is stopping. From our part, it looks fairly buoyant because the politicians, whoever is governing this, they understand that things have to be improved all over Europe and also in North America. That is a very good thing. Also, on the stove side, we had two very important shows, one in Leipzig in Germany and one in New Orleans. Here you see the Contura brand in Europe, but in North America, there are only other brands represented there, which also underlines what we said before, that North American products, Contura does not sell anything to North America and neither the other way around. I think that is pretty much what we have. Oh, you got a little bit more time. Yeah, I was quick. Twenty-five minutes. There were twenty-six. Now we are ready for questions. Please. The next question comes from Christian Hinderaker from Goldman Sachs. Please go ahead. Morning, Eric. Morning, Hans, and thank you for the opportunity. I've got two, as noted. First one maybe for Hans on the free cash flow side and specifically the working capital development, because I think the other inputs relatively as expected. You made some good progress reducing inventories down SEK 780 million versus last quarter. Consensus had assumed an increase. Receivables looks like little changed, and that's sort of consistent with the consensus. You then have this current liabilities and provisions line. That was down SEK 700 million, and so I think represented an outflow in cash terms versus expectations for an increase and hence a cash inflow. Can you just talk about what drove that cash outflow? Are there any provisions in there? How do we think about this working capital line, assuming growth continues through the rest of the year? I think the challenging thing when looking at the cash flow and comparing it with what you have in the balance sheet, so to speak, is that there are quite a few currency exchange effects in there. I mean, we have continuously worked on reducing the working capital. As I mentioned before, we have been able to do so on the inventory side. There is a portion of currency in there as well when you just look at the balance sheet or the balance sheet numbers. Also on the liability side, or the payable side rather, we have actually been able to increase those. It is more of a continued work in addressing this. I think we have talked about that before, that has also been more in focus for each individual manager in the local companies, that this needs to be addressed more meticulously. Other than that, there are no major changes that we have done on this side that sticks out or that I think, you know, should have been commented upon or so. I do not know if you are happy with that answer or what it is you are actually after, so to speak. Thanks, Hans. Maybe we can go into that separately in a bit more depth. The second question is a little bit shorter. If I look at the Europe X Nordics revenues, those were down year-on-year in all three segments. Can you just add some color on what you think is behind that and in climate solutions specifically, maybe add some context on country-level growth dynamics? All right. Is it down, you say? I thought that the figures for the first quarter was up. For Europe? Yeah, we are. I mean, the thing is, of course, that North America represents like 25% and the rest of Europe something 75%, right? Of course, it's in Europe that the growth has taken place, whereas in North America, it's been more stable, as we pronounce it in the report. In all fairness, North America stood up 2024. We didn't have that downfall in 2024 at all. That kept up pretty well. Now, of course, yours is expected to come back, which we also see. You can say that the 75% in Europe would carry the climate solution as a whole, meaning that in particular Holland, of course, Sweden, and Germany being important markets, we've seen a positive development. I don't know whether I answered your question correctly. I guess I'm a little confused because you had SEK 4,413 million was your Europe revenue number in Q1 of last year. In Q1 of this year, it's SEK 4,213 million and hence is lower. All other regions were up, it looks like. I'm, yeah, trying to understand that when we think about if heat pump sales last year had declined 51% and this year presumably growing on an easier comp, why your European revenues are lower year-on-year. Okay, I guess you caught me on one foot there. The way we have reason is that, I think I have to explain that more specifically, perhaps in a different separate meeting so we do not do anything incorrectly here. Okay, no problem. Thank you. The next question comes from Karl Degenberg from Carnegie. Please go ahead. Thank you very much. Hi, Hans and Eric. Two questions from my side then. I'll start also on the inventory side and maybe more specifically on your own inventories. I mean, as pointed out here, they're coming down again here sequentially in Q1. I just wanted to understand a little bit how you look at this going forward. At what sort of levels do you see your own inventories being more normalized relative to where current demand is right now? I guess what I'm trying to understand here is, given that you're likely suffering a little bit on the gross margin on underutilization here, for how many more quarters do you see that progressing? Thank you. I mean, in terms of the inventory, we have as a target to at least have an inventory turn of five, which we think is a good measure for us, so to speak, to strive for. I mean, what happened during the COVID phase and when demand picked up so drastically was, of course, that we sourced a lot of components because we were in a situation where we could not deliver and had very long lead times. That is an inventory, of course, that we are working down now step by step. At the same time, with volume hopefully continuously picking up here, we will have a better flow through in our factories, giving us the possibility to increase the turnover. Of course, also selling out those finished goods that we have had on the shelves. Yeah, yeah, fair enough. Thank you. My second question would also be a little bit, let's say, the sequential development here in Q1 on a monthly basis. I mean, I understand that there is seasonality, March being a very important month, but have you seen any underlying, let's say, market change in Europe here in Q1? I guess some of your listed peers have talked about a better exit rate also underlying versus sort of what the entry rate was into that quarter. No, there is a better transparency. Absolutely. Before, it was a little bit of a hide and seek what's coming in at our end and what's going out in the other end. I mean, as we say there in the report that already last year, the first fourth quarter, the later part, there we saw that things were improving and continue to improve relatively soon in the quarter. As Hans said, during the last month, of course, order intake and so forth was pretty decent. Of course, the currency will work in the other direction if you just break out one individual month. That is where we have to come back. We do not know how we are going to land on the full year when it comes to the currency situation. Of course, we send some signals, but I mean, it is our task to lead the company, whatever currency, whatever political turbulence out there. We just hope that it goes up and down, as we say, from day-to-day, changes. That again is like weather. Rain one day and then the sun the next one. That means that it's not raining every day. We just have to assume that we will arrive at some kind of a stable situation. What that's going to look like, we don't know. We believe that we have come to a position where our assortment, our capacities, they're well in line with what we have anticipated. But always going to be some kind of unexpected thing arising. Yeah, yeah. Okay, thank you very much. I'll get back in line. Next question comes from Carl Ragner stam from Nordea. Please go ahead. Hi, it's Carl here from Nordea. Two questions from my side as well. When I read the report, you say that you haven't seen a noticeable increase in demand in Germany, i.e. a sluggish market. Is that correct? On the other hand, we are seeing industry numbers indicating a 35% underlying market growth. Is it the reason behind the discrepancy, or did I just misunderstand your comments in the report here? Thanks. No, no, you didn't misunderstand it. Of course, it's a growth in Germany from a very low level of the previous year. In that particular case, we would have liked to have a much bigger market share to benefit from that growth. The market growing with some, say, 12,000-13,000 heat pumps, of course, had we had 50%, it would have been significant. As we all know, our market share is significant, but not of that magnitude. If you just assume 10%, it would mean a growth of some 1,200 or 1,500 heat pumps that particular quarter. It's positive, and that's what we see in other markets as well. It's not like changing the whole world, and then giving into account that North America is very stable. Those increases are what really is lifting the business area. You feel that you kept your market share in Germany, is that how I understood it? Yeah, that's right. It is difficult to gain anything. We have to admit that. Okay, very clear. The final one, if I may, then is on the Dutch market, which you also wrote this and said this is a good market right now. Obviously, we see some pre-buying effect. On the other hand, we also see, I mean, other growth in flexible housing, for instance. Do you think that the growth in flexible housing, as one example, would be enough to potentially offset the potential whiplash from pre-buys? I don't know whether I fully comprehended that question. If you repeat that a little bit, please. Yeah, sure. In Netherlands, the government is planning on lowering the subsidy schemes, which, according to trade decisions, has led to a pre-buy effect like we saw in Germany, right? Okay, okay. On the other hand, we also see a good demand for flexible housing. Do you think that flexible housing demand will offset a potential whiplash depending on how you look at it? I think that we've been living with uncertainty now in Holland for some time. What we see is also there that demand is not that tremendous as it was like two or three years ago. I think that it's sort of like the water comes down from the hillside. It looks like the market is perhaps returning to a more realistic rate of growth. Perhaps we all would like to have some support, of course, but perhaps the subsidies were too much in a fair sense. It is becoming more of a market where the end user decides what to use in the future. I think we believe that the Dutch market will remain strong, but not at the level that was like two or three years ago. That's very good. Thank you. The next question comes from Vivek Midha from Citi. Please go ahead. Thank you very much, everyone, and good morning. My first question is around the U.S. Clearly, it's an important market for you. While nothing's decided, there has been a draft of the new U.S. reconciliation bill, which does propose to eliminate some of the Section 25C and 25D tax credits under the Inflation Reduction Act. You expect that you don't—you've said in the report you don't expect any major changes in the near or medium term. Could you maybe talk about or expand on those comments and how you see the political situation potentially affecting demand? Thank you. We believe that there'll be a long haul of negotiations regarding that, just like it was the previous time when the administration changed in 2017. Similar discussions, and that ended up in a compromise. We do not really like to dwell on the outcome of such a potential change. We know that those discussions are going on, and it was sort of expected, but to have any theory, we can just lean against history. There the industry was able to come to an agreement with that government, with that administration. It was fairly favorable, balanced in a way we can say. They are going to continue now as well for the rest of the years, we understand, with our colleagues over there and the association. Understood. Thank you. My question is again, expanding on the question earlier about Europe. I think France and Poland have been weaker markets recently. And you're sounding in the reports more optimistic about those. What are you seeing there that gives you confidence? Is this relating, for example, to some of the subsidies in Poland coming back and so on? Thank you. Just as one reflection, one thing that gave the market a little bit of a hiccup on top of inventories being too high or inventory levels being too high was that new ZUM list. There was a new sort of certification required just for Poland that deviated from the European certification. That meant, of course, that there was an uncertainty there, and that cleared out now. That is why we believe that, okay, that uncertainty is taken away. That is one of the reasons. We did not specifically write about that. In France, of course, we are launching our, what do you call it, exhaust air heat pumps down there. We are quite successful in doing that. That is also adding to our optimism, although the market is not so buoyant, as you say. There is always room for a small operator to come in. Because there, of course, we are not a major operator. We are still a relatively small one. I understand. Thank you. The next question comes from Karl Bokvist from ABG Sundal Collier. Please go ahead. Thank you. Hello. The first one is on gross margins compared to the operating margins. You have been very clear in your ambition to get back to historical operating margin levels. My question is then how we should think about the efficiency you can make on the SG&A line compared to an ambition to get back to also historical gross margin levels. Who starts? I mean, as I said, it's always a balance with how much you should cut down on your costs. Of course, if we were assuming that we're never going to have any growth anymore to really exaggerate a darker scenario, then of course, we could cut down further on sales and marketing efforts and also on the R&D. We don't believe that. We believe that volume eventually is going to and gradually come back. You have to be ready. You can't wait now when the market is coming back. Now we have to develop products. Now we have to be present in the market. We cannot say that we're going to cut down those costs just to please the operating margin. With a combination of what we've cut down on cost and a combination of a slight increase in volume, we believe that we can be back within the bracket that we promised and talked so much about. Hope I gave you a better picture on that. Yeah, understood. If I interpret you correctly, the benefits on volume you expect to become visible also on a gross margin point of view. Yeah, yeah. Absolutely. I mean, both are in focus for us, obviously. Yeah, understood. Just on new construction, anything you see here and lead times from improving activity in that segment up until it results in more sales for you? New construction typically has a long lead time. We all know that. To erect a new building, whether that's a residential home or a bigger building, of course, that takes a number of quarters. There, the market is still relatively weak. That is why we talk about the interest rates coming down. That gives a better flavor for the end users. As much as we would like it to come down, that makes also people possibly a bit hesitant to wait another quarter or two to really carry out the investment. It is a balancing point. That is, of course, affecting all our three business areas. We like to see the new construction increase or come back to, if not a dramatic increase, but come back at least, because that is important not only for our two industries, but for the whole society. Construction drives practically everything for the new construction. That is more a philosophical one. Yeah, okay. Understood. Thank you for that. The next question comes from Vrajesh Shah from HSBC. Please go ahead. Hi, good morning, gents. I have two as well. The first one is on the demand assessment. You said that there's a gradual recovery coming in. If I recollect previously, you were expecting this year heat pump volume growth of around low to mid-teen. Has that expectation changed, or do you see anything different now compared to what you were expecting at the beginning of the year? That's the first one. The second one, okay, I'll come back on the second one a little later then. As we said initially, the quarter is pretty much in line with our expectations. We did not foresee that all of a sudden things were bouncing back to a tremendous growth, but it would come gradually. I think that's what we've seen. In that respect, it follows our own internal expectations. All right. Okay, fair enough. Thank you. The second one is on the margin progression. You talk about the margin ambition to reach to the historical level. At the same time, you say that it'll be a second-half way to recovery in Climate Solutions. Putting all this together, how should we think about the margin progression as the year goes? Is it kind of you are going to hit this margin targets towards Q4? That's how you should think about. Or on a full-year basis, you are going to hit your targets? I mean, you know that we report our margins on a yearly basis. Of course, that's a gradual improvement. When we now are at a certain level, of course, we expect particularly the second half to be considerably better than we are now. When we sum it up, we hope to be within those spans that we've talked much about. Otherwise, we say it won't be so difficult to arrive at a line with a return in one particular month or one particular quarter. I mean, that's why we always refer to the year. That's why we believe that we are sticking out our necks there, and we keep that ambition. It hasn't deviated. All right. Fair enough. Thank you. Thank you. The next question comes from Victor Trollsten from Danske. Please go ahead. Thank you. Hello, Gerteric and Hans. I guess firstly to you, Hans, perhaps, but you mentioned a boost to sales by the end of the quarter in Climate Solutions. I guess the first question would be, if Climate had organic growth of 3% in Q1, could you give an indication how much the growth was at the end of the quarter? Was it double-digit or? No, I don't think we can get into those details, but this is also a little bit of a human touch in a way. We experience it actually every month, that at the end of every month, the last few days, that's when the shipping really takes place. There was no difference, so to speak, now when coming to a quarter end, and perhaps a little bit boosted by the fact that it was a quarter end, that that's when our companies really make sure to get the products out the door. It is more of a, I would say, a human pattern in a way, that when we're coming close to closing the month, that's when the shipments are made. There were orders. Of course. Yeah. Of course. No, no. Yeah, exactly. I guess if I try you on the same topic, but from another perspective, I think you're right in the report that there is a better correlation between orders and billings now in the industry. Does that go for Q1 as well, i.e. 3% sales growth in climate solutions? Is that reflective of the order situation in Q1? Or would you say that orders is higher than that figure in Q1? It's a very intricate question, as a political person would say. Let's hope for a good answer. Yeah, yeah, right. We try to answer that. I think you should view our wording, of course. It's always a delicate thing. The transparency is not that, or the visibility, I should say, is not that very long. Now we are back to the visibility of two, three, four, five weeks. The customers, wholesalers, house builders, whatever they are installed, they know that we can deliver and the whole industry can deliver, which means that what we saw before when everyone tried to compensate themselves, that pattern is totally changed. Now it's more the other way around. They know we are very eager to deliver. Consequently, the visibility is very, very short because we do not really know what's happening out there. What we've seen during the first quarter is corresponding to what we assumed, that now demand is slowly going to come back. We can deliver. Our colleagues or competitors, they can also deliver. That means we cannot really say what's going to happen in June as an industry, unless you have long orders for new construction when you build apartment buildings, for example. Of course, you have a different situation. It is more positive, but visibility is very short, like it was prior to the pandemic as well. There is more back even there to that pattern. All right? Okay, no, fair enough. I fully agree. I guess orders were a bit higher than sales done. Or how should I? As Hans said, I mean, we could not have. It's not that with the ability to deliver, of course, we don't sit in our little fannys not delivering because we deliver whatever is asked for. The beginning of the year, as you know, after New Year and everything, is always a little bit slower before the wheels start to roll again. If you use the microscope and start to look at the first six weeks versus the later six weeks during the quarter, I mean, there is a difference there as well. I guess that's what Hans was saying, that we like to get the products out the door. To judge everything from one quarter is very difficult. We try to say, try to convey the message that we believe that the market will gradually increase. With the seasonal pattern coming back, the second half of the year, you're going to recognize the pattern that you saw before 2019. Now it's up to us to really make sure that we can deliver properly during the second half of the year because that's when stoves will traditionally have the majority of their earnings. It's also very important that we now fulfill our promises when it comes to delivery and accuracy from Climate Solutions because they're also going to be a step up due to a seasonal change. It might not sound that big, but if you, the first six months, have like 46%, 47%, or 45%, and then the second half, the remainder, oh, but that's a pretty good jump percentage-wise. That's what we are preparing ourselves for. Understood. Appreciate it a lot. Thank you very much. Thank you. The next question comes from Axel Stasse from MS. Please go ahead. Hi, good morning, everyone. Thanks for taking my question. I have two, and I will do one by one. The first question is about the EBIT margin in Climate Solutions and your 2025 guidance for the division. Could you just maybe elaborate on how you want to reach this guidance and how much volume actually we need to reach this 13%-15% EBIT margin guidance? That's the first question, please. Thank you. I think someone else answered the question to you. We do not give any specific answers, as you know. Of course, as we have said implicitly a few times here, we expect the volume to increase. That is why we really believe that the market can arrive there margin-wise. Had we not anticipated that, we should have cut down costs even further. We believe, of course, that we have to be very frugal also with the present cost level. There is always something built in to a budgetary plan. We also make certain that if volume should not really materialize, then we have also costs that we will not activate, so to say. We will not employ that and that person, and we will not instigate a certain program. We like to make sure that the volume, together with the cost structure and the frugal attitude, will make us arrive there. To give you a certain percentage is difficult. Someone else mentioned that it was in the high singles or something. Of course, we have to come back to a better growth than the 3.2. That is very clear that we have to grow on the other side of those figures. That is, of course, a little bit of a hide-and-seek answer, but I do not think that we are really willing to add any further to that. Okay, fair enough. Thank you very much. My second question is about perhaps an update on the volume or order intake you had in April or even for the first 15 days of May. Can you provide an update on this? No, we don't give forecasts like that, as you know. I mean, we are not embarrassed by receiving the question. I hope that we also give you a very polite answer. Had we decided to provide those figures, we would have said that in the report. I think in between the lines, something or some positivism could be read. That is as far as we go. We understand your question, Axel. No problem. Okay? Okay, thank you very much. The next question comes from Frederick Agard from SEB. Please go ahead. Yeah, hi. Thanks and hello, everyone. Just coming back to margin. Sorry for being a pain here. In your ambition, you say that you want to go back to the historic sort of margin range and take climate solutions as an example here, 13%-15%. You're also saying that we're going back to historical patterns in trading. H2 is going to be stronger. Historically, that has meant that H2 has had margins that have been 2-4 percentage points higher than you've seen in the first half. The question here is, does your margin ambition factor in that seasonal pattern, or is it an ambition to reach 13% sometime during the second half? No, I think we answered that question before. It's a full-year ambition as far as between 13-15. I think that everyone understands that it's in the lower region of that one. It's not like fulfilling one quarter. The challenge is now to bring it up within those brackets for the year. Yeah, sure. I understand that. What you're saying is that 2025 should have at least 13% EBIT margin, if I understand you correctly. That sounds good. In your ambition. Yep. Okay. Thank you very much. That's very helpful. You too. Okay, now we have—oh, did you have another question? The next question comes from Gustaf Schwerin from Handelsbanken. Please go ahead. Yeah, thank you. Two quick ones. Just firstly on the inventory reduction sequentially, can you say roughly how much of that was related to FX? That's the first one. I think that you would, do you take that? Yeah, I mean, the larger portion, I would say, in this respect, since we have EBIT values calculated at different exchange rates. You see that in the latter part of the cash flow statement that we showed. There is a good portion of reduction, but slightly more than half is actually currency. Okay, thank you. Secondly, looking at the savings program now, how much would you say you've realized at the end of Q1? Related to that, have you actually seen an underlying increase in DNA quarter over quarter? Because in absolute numbers, it's actually down. Is there an FX effect here or some seasonal effect or something? Thank you. Yeah, the savings program, I mean, we have, I mean, I would say it's developing, how shall I put it? I mean, the portion that we had left, so to speak, that would kick in during this year is kicking in as planned because we completed the whole program by the end of 2024. The last bits and pieces came in in December. And then we had a portion of there, and I'm trying to recall the number straight ahead in my head. But that's kicking in fairly well. I mean, we said that depreciations would kick in with some SEK 150 million additionally for the full year. And that's basically what's happening now. So that's what, of course, you need to deduct from the remaining portion of the saving. And that was like SEK 400 million. SEK 450 million. SEK 450 million, yeah. Maybe I'm misunderstanding this, but if I look at D&A in absolute numbers, it's down something like SEK 7 million-SEK 8 million. I think it's a similar development Q1 over Q4 last year. Typically, D&As are not that seasonal. I'm wondering if there's something else here because it doesn't look like it's increasing from Q4. Trying to recall or understand your question now, so to speak. Maybe we need to take this in a separate call. There could, of course, be a currency effect in here as well, but I would need to come back to you on that. Yeah, that's what I was thinking. Okay, yeah, sure. Let's do that. Thank you. With that, Gustaf, I think that we have to cut it here if we are not impolite. A few other questions out there, but I'm sure you can call us, Hans or Frederick or any one of us for that matter, and clear all remaining question marks. Thank you for calling in. Now we are going to return to board meeting and the annual shareholders meeting. Thank you once again. Thank you, everyone. Thank you. Bye-bye. This concludes the presentation. You may disconnect your lines. Have a nice day.