Good morning, and welcome to SmartCraft's Q3 presentation. My name is Gustav Line, and I'm the CEO at SmartCraft. Today, we'll talk about financial highlights in Q3, but we'll also talk about the elements of our low-risk business model. And then we'll finish off with a Q&A, and you're more than welcome to ask questions in the tool as we go along. SmartCraft delivers software to small and medium enterprises, construction companies. We help them to do several things, but basically to have a good overview of their business. And in order to do that, they need to be in control of the people out in the field, the materials that they use, to get the right prices and to get the right quality of the materials, and also the documentation related to the projects. That would be safety and quality documentation. So they need this information for each project so that they can flow between people, material, and the documentation. And this is how they get a good overview of their business, and this is how they also increase their revenue and their margin, so that you can see that our solutions are mission-critical to these customers. SmartCraft has a long history of delivering both strong revenue growth and also strong margin over time. If you look at our revenue growth, you'll see that we have grown 28% every year, the last years, which is a combination of organic growth and acquisitions. Similarly, you see that our adjusted EBITDA margin has increased by 6 percentage points over the same period per year, and it's not per year over the same period. You have to remember that we've done 10 acquisitions, so the underlying margin uplift is actually quite high since the acquisitions come in with a really low margin. Many of them come in with more or less zero margin. You can also see that we have increased our market share as we've grown number of customers over the last years. So today, we have 200 employees spread over the Nordics, and we think we have a really good position for further growth, both in the Nordics but also in the rest of Europe. So moving to the Q3 highlights, I would like to point out three important growth areas. First of all, our annual recurring revenue grew by 21%. Secondly, our adjusted EBITDA grew by 3 percentage points this quarter. Finally, our operating cash flow increased by 45% compared to the quarter Q3 2022. This is a result of several things, but it's mostly a result of a solid business model and our low risk in today's market. We see that churn has a slight increase from 7.4% to 7.9%, but we also see that the churn is trending down at the end of the quarter. Moving to the segments, let me start with Sweden. In the beginning of 2023, we talked about the changes we did in the Swedish organization in relation to the sales organization and the way we go to market. This showed good results in Q2 and is continuing to show good results in Q3, especially for Bygglet, which is the biggest solution in Sweden. We can see that the sales cycle has gone down from 27 to 22 days. That is, what we mean by the sales cycle is the time it takes from the first meeting with the customer to till the time we close the sale. We also see that the number of booked meetings has increased by 57% in the quarter. And that's a really good indication because we have a high sales conversion, which means that, when we increase the number of booked meetings, that's a good indication of future revenue. If we move to the Finnish market, we have slightly larger customers, who have historically focused on the new build in the part of the industry. And the new part, build part of the industry in Finland is expected to decrease by 38% in 2023. So we have shifted focus more towards the renovation part of the industry, and that part of the industry is expected to decrease by 4%. We see a 14% growth in SmartCraft Finland, year to date, September. It's been good to do that shift for SmartCraft. When we look at the graph to the right, you'll see that we do actually have lower activities from existing customers as the planned projects are not started. So that's why we have a lower activity, sort of making, which has a negative effect on, or actually offsetting the ARR growth that we have on new and existing customers. The good news is that churn is really low, so when these customers start up the new planned projects, we will see a return of this revenue. So that's a good thing. If we look to Norway, we'll see that we have a strong recurring growth of 17%. And we had a very strong closing in September. Cordel is the solution that carries most of the revenue, and for Cordel, we have an order backlog of more than 100% over the last four months. And the order backlog is revenue or customers that we have signed, but where we haven't recognized the revenue, because we do this in a fairly conservative way. So although the customer signed the contract, we actually help them to set up the solution, we do the training, and when they start using the solution, that's when we send the invoice, and that's when we recognize the annual recurring revenue. Similarly, like we saw for the Swedish market, the sales cycle has also decreased. And for Quality Control, which is the second-largest solution in Norway, 78% of the customers won, actually, was won in September, when we had the initial meeting, and we also closed in the same period, in September. And finally, another, another positive thing, the potential revenue pipeline is strong and at the same level as at the end of Q2. So with that, let me give the word to Kjartan, who will give you more flavor on the segments and the market. Thank you, and good morning, everyone. So, as you saw in the highlights, Q3 has been a very solid quarter for us. We, of course, have a lot of vacation in Q3, so Q3 is, in a sense, a very short quarter, but still, we have good growth. We have increasing margins, and we have increasing cash flow from operations. The segments are a lot like before. Norway and Sweden are relatively stable. Finland is still the most challenged by the macro environment. And the July dip, the vacation dip, lasts until mid-August. And we see that when customers return from vacation, and by the end of August, we have built up a very great momentum going into September. So like Gustav said, September was a very good sales quarter, sales month. Sales records were set in several solutions, and this while maintaining a very good pipeline, going forward into the coming periods. The new build market in Finland is still challenged, and unfortunately, downgrades, I'm sorry, offset the growth in Finland from the renovation segment. But like Gustav also said, the positive thing is that we expect a rather rapid increase, when this market comes back on its feet. The margin in Finland is decreasing slightly, due to the lower top-line growth. But in Norway and Sweden, which is our two biggest segments, we see a very visible and healthy increase in margin. So total revenue growth, 21%. We have, we're maintaining a high recurring revenue share, 97%. As you may know, we've talked about this a lot of times, we have a very resilient and flexible, scalable business model. We have a high profitability, which we are very consistent. We have now a 42% margin. The decrease from Q2 and 43.5% margin is due to a lower CapEx level. We have capitalized less in Q3 because of the vacation and, yeah, because of the vacation. But note also, we have included the EBITDA minus CapEx line in the chart. So year-over-year and quarter-over-quarter, we are increasing the margin minus CapEx. One of the beauties with our, our flexible business model is that we generate cash every quarter. We have a, a very good increase in the cash flow from operations, 45% in Q3, and we have also the whole year had very good increase. In the balance sheet, the, the visible change in the balance sheet in Q3 is the acquisition of Coredination in July. Acquisitions primarily affect intangible assets and cash, but we also see an effect from currency exchange and buyback program we're currently running. So ARR is, of course, our main metric for measurement. We have 21% growth in ARR. Of course, that is including the acquisitions. The growth is 14% organically. Due to the macro environment, we do see more churn related to bankruptcies in the smaller customers. We see a hesitation among, among new customers to put pen to paper. However, the pipeline, as we said, opened up in September and sales records were set. Note that, as Gustav showed on the, on the previous slide, not all of the sales are included in the ARR, as we, as we include the amount, after the onboarding is done. But with a good sales plan and good process, we have maintained a strong pipeline for the coming quarters. So to sum up my presentation, we have a proven business model, and we have a very strong pipeline. We focus to make great even better, and, we, we do this while continuing to, to be a healthy and profitable, business and acquire great solutions. That's why we reiterate our financial targets of 15%-20% organic growth and increasing margin due to the scalability of the business. Thank you, Kjartan. So acquisitions is an important part of our strategy, and we're pleased to welcome Coredination in July as part of the SmartCraft family, and we think the company has got a lot of really nice traits that we like. First of all, it adds some features and functionality that is excellent for SmartCraft, for cross-sales and upsell. But also, we like the people a lot, and we also like the metrics of the company. It's a company with great growth, it has a high level of annual recurring revenue, and it has low churn. We have a good pipeline of potential M&A targets, and what we see is that there are more companies that are for sale. The good companies, though, typically, revenue above EUR 5 million, we typically expect a valuation which is, at a, multiple that is higher than what, what SmartCraft does today. So that's something that we observe, which we think is a bit strange. So we expect those levels to come down going forward. So, a lot of people ask: How can SmartCraft deliver strong results quarter after quarter? And I wanted to take you through some of the elements of our business model and why we, I think, it's a low-risk business model for the future. So, when you look at our customer base, Sweden and Norway, accounts for about 88% of the revenue of SmartCraft. When you look at those two countries, you'll see there's a high concentration of small and medium enterprises focusing on existing buildings, renovation of existing buildings, services and upgrades of existing buildings. There are a lot more existing buildings than new build. Then we have a high proportion of electricians and plumbers as well in these two countries. You know, the energy efficiencies that's happening all over Europe and also the electrification is, so these people are really in high demand. So it's really good for them to have good tools to be in control of their business. So that's why we also see great demand from this type of customers. As a consequence of the first two factors, we are not that represented in the new build part of the construction industry. If you look at Finland, we have larger customers. We have very few customers in electro and the plumbing part of the business, and we are more exposed to the new building sector. But we are turning towards smaller customers, we are turning towards upgrade and renovation, and we also introduced our solution, Elvis, into the Finnish market, which is a solution for electricians. So we expect to be able to even out this picture going forward. Great software companies need to be really good at marketing and sales, and I think we are doing quite a lot of things to be smart in how we spend our marketing and sales money. First of all, it's important to remember, we are in a massive market. It's a market where digitalization has not really happened. So the construction industry is really far behind a lot of other industries, so we see great opportunities. And that's why we need to be quite visible in the market. And how we do this is through marketing and we are very present on typical social media and so on. So if you look to the graph on the top, you'll see that our brand exposure has increased for the SmartCraft group quite a lot in 2023. We also have a lot of initiatives to create online sales and also to get inbound leads, so the customers actually contact us as a consequence of our marketing. And at the bottom right you can see how this has increased over the nine months as well.... Also, we have a very steady and strong sales conversion rate from when we meet the customer to when we actually close the sale at 55%. So these are important metrics, which is an important part of our success. Another thing that differentiates SmartCraft from a lot of other software companies that I think you need to be aware of is that we are very selective to what type of revenue we take on board and we want to focus on. For example, set up and installation fees. We think that should be part of the package that the customer already pay for, which means that we help the customer to set up the solution. Instead of charging the customer, we sort of lose out on that revenue, and we do it for free, so it means that our margin goes slightly down as a consequence. When it comes to consulting and training and support, a lot of software companies charge customers for that. It's really easy money. We think that this should be free, the solution should be easy to use and you shouldn't really need a lot of training, and we should provide support for free. And the consequence of that is, of course, in the short term, we lose out on some revenue, but since the people doing this work, the consultants, if they were working at SmartCraft, they're quite expensive, we get a high margin. Lastly, hardware and third-party software, we think the customers should buy this directly from the vendors. They get better service and probably better prices, which again means that we don't get that revenue, but since the margins are really low, we get a high margin. As a consequence of this strategy, we get. It's much easier for our customers to buy the solution. It's really easy to see what you buy, and we have predictable prices. But it also means that we can increase the monthly fee because we have a really low entry level for our customers. And again, we get a high financial visibility and high quality of our earnings. So we have now 97% recurring revenue. If you look at a lot of other business-to-business software companies in Europe, you'll find that that's quite an outstanding number, and then you can look at the left to see what they include in their revenue. So, we offset the non-recurring revenue, and it really motivates us to make great solutions, and we are super focused on having a business that scales. So every time we win a new customer, of course, there's a little bit of cost of goods sold involved when we get a new customer on board. There's also a little bit of customer care in going forward, but there's also some upsell opportunities. So the cash contribution from each customer is actually really strong. So I would like to introduce the SmartCraft Rule of Ninety, and I think great software companies should have a high level of recurring revenue, and they should also have a high gross profit margin, which we can tick off on both. SmartCraft, we do several initiatives in order to increase revenue and also to reduce complexity and COGS. If we start with how we reduce complexity and COGS, and we look at the first initiative, we have something called the SmartCraft Accounting Connector, where we connect to one accounting system, and then several of SmartCraft's solutions can connect automatically. Then we don't do it three times; we just do it one time. We're launching SmartCraft Calculation in the beginning of 2024, and that's a great upsell opportunity for several of our solutions. At the end of 2022, we launched integration between Cordel and Quality Control, enabling cross-sales. And in Q3 this year, we initiated another two integrations between Cordel and Elvis and also between Elverdi and Elvis. So these are great opportunities going forward. So to finish off, a lot of people ask: What about SmartCraft and the different solutions, and how do you do the branding, and so on? Well, we are building awareness around the SmartCraft family, and all solutions are now having the tagline, "Part of SmartCraft." And at the bottom of the slide, you can see a stand from one of our industry fairs that we attended last month. It's the big Reistad, which is the biggest construction fair in Norway. And they have this every second year. This is the stand where you can see the SmartCraft logo and also the associated solutions working under this brand. To finish it off, you can see that we continue to deliver on our strategy, we continue to reduce operational risk, and we have a strong, a consistent operating cash flow. With that, let's move on to the Q&A, and Kjartan, please join me as well. All right, thanks a lot, Gustav. We have a few questions coming in from the webcast viewers, and you're all welcome to post further questions during the Q&A session, and we will bring them forward. So, a couple of questions from the viewers on the growth rate. Obviously, you're referring to your 15%-20% sort of growth corridor, slightly below that at the moment. Can you talk a little bit around that also in the light of the Q2 communication, where you also saw a good outlook for the second half in terms of pipeline? So, can you please elaborate a little bit on that? What brought you slightly down and also the outlook for the last part of the year? Yeah. We don't, we don't guide on in the short term, so this is a medium-term guiding. And we do see, as Kjartan said as well, that we have a very strong closing in September, which is a very good indication. We have see a lot of activity in the market, a lot of demand for our solution. So that is fairly constant compared to what we have experienced in the past years, actually. Don't know if Kjartan if you want to elaborate a bit as well. Yeah, in June we say that we have a good pipeline for the second half, we do, and we still do. But of course, straight after June, we're into the summer holidays, so July and August are a very slow period. So, when we say a good pipeline for the second half, it's mid-August till the end of the year. So a smaller portion of the pipeline in Q3, but we still have a very good pipeline going forward. Thank you. One follow-up on that. It looks like September was a strong month for SmartCraft's business. Has this trend carried over through October? Yeah, I think we can say so. I think, you know, in September, we had good activities with our salespeople, and they both closed deals and also built a very nice pipeline. Going into October, we had several industry events, very well visited, and we see that the interest for SmartCraft solutions continue. Yeah, I would say that. Thank you. Last one for now, at least on the growth topic. What factors could push SmartCraft's organic growth rates towards the upper end of the corridor, in the, let's say, next 12 months period? Well, I think, I think we, we do what we have done over the last 10 quarters. We build stone by stone. We, we try to do things smarter and better. We continue to invest in the organization. We continue to, to invest more in marketing and sales. And I think that's gonna give us a strong position and increase our competitiveness compared to maybe other types of competitors that might actually slow down their activities. We do see some nice positive signs. We are building more pipeline. We are getting more meetings when you compare year-over-year. So it's difficult to predict exactly what's gonna happen, but we try to build this company stone by stone, being better this quarter than we were last quarter, and spending our money wiser than we did last quarter, and so on. But, Kjartan, maybe anything else to add to this? No, I think we have a proven business model that is very scalable. As Gustav said, we're building stone by stone. And of course, we continuously evaluate the next steps, what can we do to grow faster? But nothing we could disclose at this moment. All right, looking further into 2024, how do you view the potential for price adjustments to compensate for inflation in the current market environment? Yeah, that's your question. We always do price adjustments based on the CPI. We have always had an annual adjustment. Last year, we did at the year-end. We will do the same this year. And yeah, what we do is we look at the CPI as a basis. We make a specific adjustments if that is required, but we don't do any more aggressive price hikes according to our strategy. All right, thank you. One viewer is bringing up a few different angles to capital allocation. So how are SmartCraft's acquisitions funded? Is it a combination of equity and... And if it's a combination of equity and cash, why aren't you utilizing debt? Well, so far, we have funded acquisitions on a cash basis. The targets in our... But if we look at the whole market, we're the market leader in a very fragmented market, so most acquisition targets are quite smaller than us. So we have a good cash flow, generating cash that we can use for M&A. And so far, we have done all M&As on a cash basis. Going forward, if we find a larger company that we can acquire, we could do by equity, we could do by debt. But that is a case-by-case evaluation. Could you please provide some additional color and detail on your capital allocation strategy in general? I mean, the mix of acquisitions, buybacks, dividends, organic reinvestment opportunities, et cetera. How is your thinking and strategy around the prioritizations, as such? Yeah, I think just to, before you can answer more detail, I think the important thing is that we want to be a consolidator in this industry, and we think there are some great companies to buy. But we do think the prices are, like I talked about earlier, slightly high. We want them to go down, and we want to be a bit strict on how we spend the capital. So we want to have some cash in order to do acquisitions. That's an important part, and then maybe you can continue. Yeah, well, to continue on that, when it comes to dividend, we currently have a no-dividend policy set by the general meeting. We want to have the cash to make strategic investments and M&A. So far, we're building up cash. We haven't gotten through to the price expectations that we maybe would like, but yeah, as for now, we have a no-dividend policy and want to spend the cash for acquisitions. Yeah, just let me add to that. I mean, if you exclude Coredination that we bought in July, we've done nine acquisitions. They've all been increasing their profit and the EBITDA margin. So I think we know how to spend the money wisely, and we have a great track record of good investments, so that's why we want to continue doing that. A little bit on the customer side, what percentage of the total cost base for your customer that would typically a SmartCraft solution represent? Any way of giving color on that question? Wow! We did a calculation on that. I can't remember the number, actually. Yeah, we have earlier made an evaluation of this. Our take rate of the customer wallet was back then 0.5%. So what... Yeah, I assume it would be roughly the same as of now. What we do know is that the SmartCraft solutions is considered an operating expense and not a capital expense. What is the average lead to conversion time for a new customer from a booked meeting until you have a subscription agreement signed? Yeah, we don't have a number for the group, but we did mention some that we just used as example in presentation today. Bygglet is one of our biggest solutions. They had 27, 17, 20, 22 days. We had Quality Control that closed quite a lot of customers within the same month, so I think that gives an indication on the lead time. Looking at your product development, et cetera, what steps have you taken to capitalize on large language models, AI in general, and machine learning? When it comes to capitalization, we of course follow strict principles set in accounting principles. When it comes to AI, we should have a tech session with our CTO for the more technical aspects. But when it comes to how we capitalize, it's strict IFRS principles. How do you view the growth potential in Norwegian new construction, when you see that the growth rates in the industry is lower, and potentially when interest rates come down in the longer term? How do you see the market outlook? I think it's important we try to get this message across. We are very optimistic about the future potential. Now, we know that the new build part of the construction industry is in a slump. That, I think that's hitting all three countries. But we are in a very strong position with our solutions, basically focusing on existing buildings, smaller customers, very strong in electro and for the plumbing sector. So we continue, we're gonna continue to do more of that, and then hopefully, the new part of the new projects will increase, and then we'll definitely be back to do and grab more part of that business as well. Thank you, and I think it's the final question for now, at least. Following up on, basically, on the market, could you give an update on how you see the competitive landscape and how that has changed in the light of, the more challenging trends in the construction market as such? Yeah, I think what we try to get across, we continue on our track. We keep investing, we keep hiring people, we keep doing all the things that we think are correct to do in order to increase our competitiveness. We see that actually, some of the smaller competitors have gone really quiet. There are not many new competitors entering the market. Some of our competitors are taking down their activity levels. So for us, we feel that we are in a good position, and actually, competition has come down over the last Compared to maybe a year ago. Thank you. There are no further questions from the webcast viewers now. All right. Well, thank you very, very much for joining us in this session, and have a great day!