Hello, welcome to the Profoto audiocast teleconference Q2 2021. Throughout the call, all participants will be in listen-only mode, and afterwards there'll be a question and answer session. I'll now hand the floor to CEO Anders Hedebark. Thank you. Welcome to Profoto. We are very happy today to present our first official quarterly report as a quoted company. My name is Anders Hedebark, and with me today I have Petter Sylvan, CFO, and investor relation Gunilla Öhman. We have very strong sales following the opening societies in the Q2. We are very happy for this. This is demonstrated with the sales of SEK 172 million, which is an up from 2020 with 113%. Currency-adjusted, the growth is 131%. Last 12-month sales is growing to SEK 624 million. We can see the curve is turning up. EBIT is good. It is reaching SEK 53 million, which corresponds to an EBIT margin of 31%. This is adjusted EBIT, adjusted mainly for IPO costs. As I said, the opening of the society is really what is affecting the sales in the second quarter, but also the continuing sales of our Pro-11, which was launched during the first quarter, is also positively affecting the sales. During the quarter, we also launched the Profoto Camera, the only smartphone-based camera app that works with professional flash. The iPhone is a very good consumer camera, and Profoto is making it into a professional camera. Professional photographers need light to create fantastic images. In addition to this, we worked very hard with IPO, and it was obviously a very important event for the company. Let me start with giving you a short overview of what Profoto is all about. We are active in the attractive and growing image and content creation market. We hold the premium position in the segment photography lighting solutions. We provide the market with a broad system of lighting products that enables professional photographers to focus on their creativity. This is why the world's best photographers are using Profoto when they're creating their fantastic images. We sell all over the world. We're focusing mainly on organic growth and high product margins. This means that we have to, and we also love to invest heavily in product development. Our target is to invest around 10% of sales back into product development and new products. We're also very detailed on what we do and what we do not do. Prioritizations is key for us. That is why we outsource a lot. For instance, we have all the production outsourced, and this helps us to have a very asset-light balance sheet. This is also why we're trying to only hire the very best people, I'm very proud of all our staff, and it is basically staff that is delivering this good result during Q2. We have a long history, and we have focused on taking the premium position already from the start, and you see that this is an image already from 1968 by the two founders. I came into the company already in 1997, and I have focused a lot on growth through high sales activity and also launching a lot of new product. Petter, you will meet him very soon, he started as CFO in 2009 and has focused a lot on efficiency and profitability. In our market, we are active, as I said, in the image and content creation market. This means all kind of content produced, including TV, film, et cetera, and all marketing material produced all around the world. This market is showing a very strong growth. Profoto holds the premium position within the black bulb here, which is the segment lighting solutions market. This market is planned to grow 3%-5% according to our EY studies that we commissioned in conjunction with the IPO in the beginning of the year. This growth is based on the exponential growth that we see in number of still images published all over the world. Anyway, we are focusing on this black part of this image, and we have a very strong core, which we are planning to continue to grow in order to reach our financial targets. We're going to sell more, launch new products to professional still photographers. In addition to this, and going forward, we have identified three attractive possible high-growth areas. Number one is within professional smartphone photographer, where we see a rapid change in the market. Profoto has already launched Profoto Camera, as I just mentioned, and it's the only existing solution for professional photographers today. We see further growth opportunities, both organically and through acquisition. Number two is light for video, film, etc. We already have products in this area, and we are continuing to invest product development activities into this area. We are offering products for professional still photographers that want to shoot video as well on the same shoot. However, if we want to reach a pure filmmaker or a TV maker, a light for this purpose, probably we need to go through acquisition in order to do that. Number three is within the industrial and e-commerce segment. Here, we are offering products into this segment, primarily a product called D2i or D2. There is a potential higher growth possibility into offering a much broader solution, a complete solution for volume photography. We are constantly developing our offer in these areas. We are also evaluating bigger moves. Our main focus is to grow in the black area, in the professional still photography area. During second quarter, we worked very hard with IPO. In that process, the investment highlights were that we are a leading brand in a global niche. We are working in an attractive segment in the growing content creation markets. We are, though, focusing on the core operations and innovation to expand the addressable market. Organic growth is super-duper important. We have a possibility to grow in different areas. This is based on that we have a very competent and dedicated management team with a great track record. Petter will show this, that we have a long-term organic growth with very good profitability. The IPO, the 1st trading day was the 1st of July, and the start was very successful. In July, the share price went up 26%. We are listed on the Nasdaq Mid Cap marketplace, and we are very happy and also proud that we have partnered up with really high-quality cornerstone investors, which are Lannebo Fonder, Svolder, Herenco, and Strand Kapitalförvaltning. Initial share price was SEK 66, and the IPO was heavily oversubscribed. As normally, there were greenshoe agreements and stabilization measures that were supposed to be put in place by Carnegie. They were never used, and they were finished earlier than planned. We welcome many new shareholders into owning Profoto. Thank you very much. I will leave the word to Petter, and he will give you a better presentation of all the figures. Thank you. Hello. As Anders has mentioned, Profoto has a long history of profitable growth. If we look at the chart here, in the period between 2010 and 2014, we've grown year-on-year 10% with an EBIT of 15%. In the five years prior to the pandemic, up till 2019, we increased the growth to 16% year-on-year, and we significantly increased the profitability in the range between 25%-30%. This is what we aim to continue to do, and this is what we are delivering this quarter. As Anders has mentioned, we are now trending upwards in our last 12 months sales. This is what we see or believe that we see in the market. Every month, every quarter is typically better and better for us, in the line with that the societies open up. Of course, this is a mixed experience, how societies open up, but what we see in the quarter is that America is leading this. Europe is slightly behind. In Asia, we have a more mixed experience. We didn't have that downturn during the pandemic as we saw in the rest of the world. However, now we have some local outbursts in India, in Thailand, in China, that put further restrictions back. Overall, not least in America, we see more weddings that are important for us, fashion events, and other kind of events. This lead to that we deliver a stronger EBIT, adjusted EBIT margin, as a consequence of the higher sales and the high increased efficiency and low cost. I just would like to emphasize that the only adjustment we are doing for the first half year are for the IPO cost. There are nothing else adjusted. Sales started to rebound for us in Q4 last year. There we also started to deliver a better profitability where we want to be. That was a consequence of that we had the full effect of the cost savings and the operational increased efficiency. Now for the second quarter, we are delivering an EBIT exceeding our target range, that is between 25% and 30%, and we're delivering 31%. Looking at the financial targets for the net sales, we are by far exceeding our financial targets. Not that surprising. However, we can also see that, as Anders has mentioned, the sales growth in constant currency is a bit higher than the reported 131% instead of 113%. The unit growth is good. That makes us feel confident that we are on the right track to achieve our target to be back on our pre-COVID level, exceeding SEK 800 million revenues by 2023, if not earlier. EBIT margin, as I mentioned, we are delivering the 31%, exceeding our range of 25%-30%. We have said that we have an absolute requirement that we, year by year, should deliver a higher EBIT in absolute terms. We typically focus on growth when we deliver a very high EBIT margin, as we're doing now. Typically then, we are trying to do our utmost to find more growth initiatives that we can invest in. Having said that, for the nearest quarters with the high efficiency we have and the underlying growth in the market when societies open up, I believe that we will be in the high range for the near term. That's my financial information. I'll leave the word to Gunilla. Hello. I just want to give you the latest update on our shareholders end of July. There are not many changes from the IPO, but we were happy to note that Afa Försäkring has been buying during July. Otherwise, not that many changes. With that, I would like to open up for questions. Thank you. If you wish to ask a question, please dial zero one on your telephone keypad now to enter the queue. Once your name has been announced, you can ask your question. If you find it's answered before it's your turn to speak, you can dial zero two to cancel. Once again, that's zero one to ask a question or zero two if you need to cancel. Our first question comes from the line of Karri Rinta of Handelsbanken. Please go ahead. Yes, thank you very much. Karri from Handelsbanken. A few questions from me, if I may. Firstly, a few details and then a few more broader questions. You mentioned that you did have an impact from component shortages and delays during the quarter, and it had an impact on sales. Could you in any way quantify that impact and then maybe comment whether it had any impact on your margins? That's my first question. It hasn't had a significant impact. It's had perhaps a one-digit impact in terms of share of sales, I would guess. It's an unknown territory. We receive new information every day. On the margin side, it may have an impact of 1, 2 percentage points or something like that, in the range of that. So far, we are, as the logic we're supplying pretty much of what we expect to sell, what our expectations is and in line with our path to our financial targets. Where we have more challenges are when we, for a certain product group, significantly have a demand that increase our expectations. Okay, the follow-up on that. I should have checked this, but I haven't. What about your inventories during the quarter? Did you build inventories or do you have low inventories or how do you feel about your ability to add supply during the coming months? We haven't built inventory. It was fairly low when we started as well. I don't on top of head the exact change, but it continued to be on the low level since we are short on supply on some of the products. Typically, everything that comes out in goes out. Okay, how should we think about this in terms of seasonality? Because we don't have that much historical information available, and if we look at, for example, 2019, that was a pretty unusual year. How should we think about the third quarter seasonality in this environment where you, on one hand you have the seasonality and on the other hand you have this reopening going on in many parts of the world? I guess we should still sort of pencil in some seasonality this year. Yeah. It's pretty much the guidance that we gave in the prospectus that Q3 is normally If you look at it and if you look back in your analysis or prospectus, we have a fairly even distribution of seasonality sales in the quarters. However, Q4 is typically a bit stronger historically, and Q3 is typically the weaker. We have said that the good description of distribution is 2018. In addition to that, we have said that we expect that the Q3 now will be better than typically 2018 as a consequence of that societies are opening up. Yeah. Okay. That is what we said in the prospectus. Nothing has changed due to the component situation. We mainly see in the near term that this can change, but we mainly see as we see it now in the near term, that it is delivering further on the upside. That is the main challenge from a component situation perspective. All right. The component situation and some of these uncertainties related to the pandemic, has that had any impact on your plans when it comes to new product launches in six to 12 months? No. No. Have you said anything about should we expect something already this year, or how does the pipeline look for the next six-12 months? We have said that we don't disclose when we do our launches. We haven't given any public information, and we don't have any typical launch dates. If we look at our historic patterns, we have said that typically we have one to two more significant launches over a year, and the way we plan right now, and then a number of minor launches or updates, up to 10 or so. We haven't guided anything of specifically what is going to happen in the world. Based on that information, you perhaps can guess. Sure. Related to that and related to your comments that you made in the report about Pro-11 and D2i, or e-commerce photography, can you give us a sense of any ballpark number of how much of your first half sales or second quarter sales came from Pro-11 and D2i? No. We're not talking about specific. What we can see, though, is that sales is better than usual for these two products. You want to add something on that? We can also say that we see a general increase in demand and delivery more or less on all our product lines, including the product lines that has had the weakest development during the pandemic has been the on-camera flashes, that, for instance, are popular among wedding photographers. We have seen during the quarter that as one of the lagging groups also has significantly picked up in demand. We don't see any specific group that is far ahead in terms of demand. It's all over the line increased demand. All right. On that note, on-camera flashes, because I think in the market study that you commissioned, I think on-camera flash outlook was rather dull going forward, i.e., that it would not really grow beyond the pre-pandemic levels in the coming years. Do you still believe that, or do you think that conclusion still stands, or are you maybe a bit more optimistic about the on-camera flashes going forward, or is it still too early to say? We are pretty confident on the on-camera flash. The study that was commissioned is based for the total market of on-camera flash, as you see, our product is working for the photographers that want to create great light images in the images, light patterns, and that's why our head is round. It's not squared, whereas Canon, Nikon, and other flashes like that, they have a rectangular head, which means that they are providing sufficient light for the correct exposure. That is not what Profoto's A10 is doing. It is creating beautiful, natural light for everyone that want to create beautiful images. We are doing our own thing in that respect. That is why it is not one-to-one comparable. Having said that market is declining, and especially for Canon and Nikon flashes. All right. My final question is about video lighting. You mentioned that you have products for professional photographers that also want to shoot- Yes Can you tell a bit more about which products are those, and then why aren't they sufficient for the pure filmmakers? It is B10, and it's a combination of continuous light, which is good for video, and flashlight, which gives a lot of light during a very short period of time for still photography. This is offered mainly to still photographers that want to shoot both. It is for large sets or large filmmakers, they want to have all continuous light only, number one. Number two, they want more light than we are providing. This is good for certain smaller productions that you do both, but it's not sufficient for larger production, and that's my point. Do you feel confident that the professional photographer that needs to or wants to shoot film as well, that he or she gets what he or she needs from B10? No, it is different for different applications and different projects that is made or different sets. This is only catering for a small part of the needs, even for still photographers that are shooting. If still photographers only shoot video, they will use something else. This is our first tiny step into this market. We have a lot to do in this market if we want to take a large share. Fair enough. Okay. That's very helpful. Thank you very much. Those were my questions. Thank you. We have one further question on the phone. That's from the line of Viktor Lindeberg of Carnegie Investment Bank. Please go ahead. Morning. Thank you. Congratulations to good start as a listed company. I think some of my questions were answered. I have a few nitty-gritty follow-ups. One of them being the FX impact in the quarter is quite severe. It's -18%, if I read it correctly. Just looking at my FX model, it doesn't really add up to that level. Can you help me out here on maybe your methodology or if there was a country that was way off compared to the big countries being, I guess, euro-denominated and also the Japanese and U.S. dollar related exposure you have. Any flavor there could help. I must be honest that I don't have that broken-down analysis myself. If we can follow it up separately, but I cannot answer right now. All right. On supply chain, maybe if you can elaborate on how it has changed during the quarter and if it is at present in a better or worse situation, and if you have any ideas on how to trend from here and onwards. We believe that it's more uncertain than perhaps the quarter when we started. On one hand, the effects on delivery and on margin effect, we saw an improvement during the quarter. It was less and less increased costs and better and better delivery on one hand. On the other hand, we, for instance, had an outbreak of COVID in the factory where we manufacture in Thailand, our contract manufacturer, which had an impact on their efficiency and how much we can get in the short term of the factory. That was typically a surprise by the end and during July now. On the other hand, we also saw just recently a new increased announcement of longer lead times to components and higher costs and so forth. Perhaps the uncertainty has increased financially here and now, not necessarily that much change here now as we see for the coming quarter compared to Q2. We are very humble that it's very hard to predict. There are, as I said, a number of reasons why we think at least in the midterm, short term, coming one, two quarters or so, that it will perhaps have most effect on our sales potential upside, higher growth than we have anticipated. One of that reason is that very much of the current supply of components and so for the productions for the coming one to two quarters are already secured with quite some time. In the longer term, uncertainty has increased, but I don't necessarily think that it's a significant difference for us or other manufacturing companies. Okay. Also, you had some IPO related costs in this quarter. Should we expect any more costs coming now in Q3 that are of a non-recurring character? No. Okay. We have the ambition. This year? No. We have the ambition to fulfill and report the target and then report the EBIT margin. That's what we have said. Okay. In our normal business, we don't expect that we have non-recurring items. Okay. On your capitalized development expenses and also looking at the depreciation you have is fairly in balance today. You capitalized, I think SEK 5 million, and you had some depreciation of slightly more than that. How do you see that balance going forward in maybe the coming 12 to 18 months? Do you see any meaningful change and a direction in the balance? Also, if you will either start to capitalize more or less? We have an ambition to, if I start there, to capitalize more. The underlying reason for that is to better capture in line with the requirement of IFRS what should be capitalized. We capitalize too little in relation with the framework guide as we see it. We are a bit too prudent. We believe that will improve or increase within this Q3, Q4, something like that. On the other items, the typical drivers for increase of balance sheets are for us the accounts receivable and inventory. Accounts receivable typically is a factor of growth of sales for us. We don't expect longer payment times or so. We expect it to grow with sales. For inventory, it is probably likely that it's going to grow with a higher pace than sales, not the least the coming half year as a consequence of trying to fulfill demand and trying to secure components and so forth. Yep. Makes sense. Okay. Thanks, Anders. Back in line. Thank you. Thank you once again. If there are any further questions, please dial zero one on your telephone keypads now. Okay. Currently there are no further questions on the phones. I'll hand back for any questions on the web. No, there are no questions on the web or on my email either. I thank you all very much. I want to remind you that our third quarter report we will present on November 4th. Very welcome back and get in contact with us if you have more questions. Thank you.