Welcome to Vitec Software Group Q4 2023 report presentation. For the first part of the presentation, participants will be in listen-only mode. During the questions and answers 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, Olle Backman, and Patrik Fransson. Please go ahead. Thank you, operator, and a warm welcome to everyone on this call, where we will cover the year-end report for 2023 that we released early this morning. I'm Patrik Fransson, Head of Investor Relations at Vitec Software Group, and joining me in this room is our CEO, Olle Backman. To begin, we will provide a brief overview of Vitec, and then followed by our insights on the fourth quarter and the entire fiscal year of 2023. Following the presentation, we will open up the floor for questions. With that, I hand over to you, Olle. Thank you, Patrik, and good morning, everyone. I will start up with a quick overview of Vitec today. We always start with a customer perspective, that we serve nearly 25,000 customers out of our nowadays 41 business units. Says 40 here, but we have already, as you have seen, acquired another one earlier on this year, LDC in the Netherlands. To these customers, we have an accumulated sales on a pro forma basis of nearly SEK 3 billion run rate today, out of which 84% is recurring revenue, which is, we are very proud of. And I have nearly 1,500 colleagues based out of 11 countries, but we have our five home markets, which are the dominant ones, which is the four Nordic countries plus the Netherlands. You can see also the geographical distribution here, with an emphasis on these home markets. To start up, we have our strategy chain, which we call it, that will guide us. And goes from vision all the way back to the values, and, and also my personal favorite here is the brand promise, which says all about Vitec and our long-term ambitions, which is to rely on today and tomorrow. We strongly believe in focus, and, and for this matter, we have condensed our work into, and structured our work into four different segments here, focus areas, which we call them, which will guide us through this presentation as well. Responsible growth, enabling products, empowered people, and reducing footprint. And starting up with responsible growth, we have a business model in which we strive for having a high percentage of recurring revenue, and we are also usually the market leader in our respective niches. We work with our business units, which is the develop phase. So we develop our organization, we develop our products, and this is where we also have our organic growth coming from. And then to top that up, of course, we have acquisitions where we from a very stable set of criteria acquire nice vertical software companies, which are established, profitable, they have their own proprietary software, and they all have a decent amount of recurring revenue. That's what we look for. This is a picture of basically the market as we see it today, because by the size that Vitec is today, we are a mirror image of the market. So, usually small, medium-sized businesses, but every now and then, something a bit bigger pops up, like it did this year, in 2023, when we were able to acquire Dutch Enova, which was a bit bigger than usual. And talking about acquisition, last year's record amount of six acquisitions. As you can see, we did two in the Netherlands, two in Sweden, and two in Finland. Now, this is a range from small bolt-ons, like LDC and Entry Event, really small ones, but they were bolt-ons to acquire existing business units, up to bigger Enova, like I said, nearly SEK 300 million. Excellent start of this year, also adding Dutch LDC just last week to the family. It's a really nice addition for a nice vertical software company. Moving over to what we call enabling products and how we structure that. We think that Vitec plays an important part in society as a whole. And as you can see, this is a picture of all our business units and the verticals that we operate in. 20 or so, but now then 21, when we add LDC to it. You can see we have many business units in some verticals and a few in others, but and they are not a deliberate strategy of finding synergies, but more of the same, that we look for nice vertical software companies that meet our criteria, and then if they are in a new vertical or an existing one, to that, we are quite agnostic. A more traditional picture, perhaps, of the organization and how we're structured, and this is also how we're able to grow. So as you know, all the action is in the business units, the red square at the bottom. They are autonomous units. They have their own resources for development, sales, operation, customer support, products, marketing, et cetera. And then to aid them, and to guide them, and to challenge them, and also to share common experiences, we have the VPOs, which is a very important person in our management team. This is how we can scale it. So more business units, we add another VPO, roughly seven to eight business units per VPO. So we just added another one, actually starting today, so it will be another face on this picture coming up the next time. Then, of course, we have our headquarters with support functions for the business units, if they want to. One important thing in our culture is about sharing, and what we mean by sharing is that both we have a common culture, we also have sharing concepts, which is forums for best practice sharing. It can be anything from product development, coding, it could be marketing, it could be finance, it could be sales, it could be customer support. And this is the really highly appreciated forum for all the business units because they are quite autonomous, and being autonomous is also being a bit alone in your thoughts and what you try to do. And in these sharing forums, we're able to head up with peers thinking about the same problems as they have, so this is a great concept for us. And of course, lastly, we have our reduced footprint focus area, and of course, we both help our customers through our softwares, but of course, we also look how we can get better at our environmental profile ourselves, so we have quite ambitious targets for this, and to reduce our carbon dioxide emissions by 75% up to 2030, and we are on the way to that target. Then moving over to some of the numbers here. So you can see here, we start up with sales. Compounded growth is, as you have seen over the years, nearly 20% year-on-year, but this year was an exceptional 40%. Of course, a lot of it is due to the fact that we were able to acquire Enova, which is a bit bigger than usual, but also solid organic growth to support that. And if you see on the quarter, it was an increase by 28%, up to SEK 740 million. And like I mentioned earlier, pro forma basis, we're up to SEK 2.9 billion, nearly SEK 3 billion in sales. And more importantly, of course, is the profit level. So our EBITDA increased with over 50%, and as you know, we always strive to increase our margins with a higher number than we do our sales, and this was true for this year and for the quarter as well. So we increased on the quarterly basis, our EBITDA with 31%, up to SEK 224 million. And the EBITDA margin year to date is up to 32%. Talking about growth, this is a bit new. We were trying to guide a bit on the last three years, so we have our organic growth in our recurring revenue, because this is sort of the key in our business model, and this is a lot what we communicate, both internally and externally. And as you can see, we had a healthy increase here of 14% on the total for the recurring revenue, out of which 10% is the net effect if you take out the FX, so 4% and FX tailwind, both in our recurring revenue and in our total net sales. Total net sales was up to 10%, including FX and 6% if you exclude the FX effect. Looking into diversification of sales, this is a very strong position for us, so we have a great diversification. You can see, of course, across the geographies there with our 5 home markets, and then you have rest of Europe and the rest of the world on 7%, and then US on 5%. Like we mentioned earlier, nearly 85% of it is recurring, which we are very proud of. On the customer distribution, all these nearly 25,000 customers, the top 10 of the software customers only stands for 8%. This gives us, of course, stability, but also very good risk distribution. Then to sum things up, we have been doing this for quite some years. Next year, we have our 40th anniversary. We were founded back in 1985, and I think we have a good record of showing a sustainable profit growth, empowered by these recurring revenues, both organically and inorganic. You can see the bullet points here, just as a sum-up of the year. Of course, last but not least, we're very proud for the 27 consecutive year that the board will propose to the AGM for an increase in dividend up to 3.00 SEK per share. With that, I think we will open up the floor for questions. Thank you. If you wish to ask a question, please dial pound key five on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial pound key six on your telephone keypad. The next question comes from Erik Larsson from SEB. Please go ahead. Thank you, operator. Good morning to you. Happy to have the first question on your first conference call here. First off, do you have any idea of what level the price hikes have come through so far in January? Yeah, we have, some of the business units have already done their price increase, and of course, if you increase prices in January already, they are based on a CPI, for instance, that has come earlier the year, usually in, like, October or so. And it varies, but it's a bit lower than last year, of course, but still on healthy levels, somewhere between four and six, is the numbers that I've heard so far. But a lot of the business units, we do price increases all through the first half of the year because someone waits in the year-end, the CPI numbers, and so it's an ongoing work here, and also different from country to country. Okay, perfect. And then, just the second question on taxes. It's come up a bit recently, but also in this quarter, and I guess it's from mix. But, I was just wondering if you have any guidance, where do you think this or sort of where a normal tax rate could be going forward? Yes, that's true, Erik, because when we have a larger and larger portion of our earnings comes from the Netherlands, but also from the U.S., and both those countries have a higher average tax rate than Sweden, for instance. So, I think we're up to somewhere between 22% to 23% on average right now. So I think that's a pretty fair assessment with the mix we have today. Okay, great. Thank you for that. That was all my questions. Thanks, Erik. The next question comes from Daniel Thorsson, from ABG Sundal Collier. Please go ahead. Thank you very much. I start off with a question on the cash flow here in Q4. Back in Q3, you said that you have a lower seasonal effect, post the recent larger M&As you have done, while here in Q4, the cash flow was a bit weaker again. How should we think about cash flow seasonality going into 2024? Should we expect Q1 to be as strong as it has been historically, for example? Q1 will always, by far, be our strongest. We will have a bit lower with the acquisitions that we've done lately, but that is also the reason why the cash flow is perhaps a bit weaker in the Q4 here. Because Enova, for instance, we talk a lot about Enova, but it's quite a big acquisition, so it sort of impacts the entire group. In parts of their revenue model, which is the balancing services, of course, they need to win the auction, they need to prepare it, they need to invoice it, and then it gets paid. So there's no element of prepayment in specifically the Enova model. So for that reason, we have seen a bit of increase in building up working capital now. But for sure, Q1 will still be a very, very strong quarter on the... for us. Okay, that's, that's clear. That's helpful. Secondly, on the M&A landscape here, how do you view the competitive landscape? We have seen quite a few, actually, several new companies started in the recent years, also looking to acquire smaller VMS companies. Have you seen any increased competition in the Nordics, specifically, or prices coming up that could affect you ahead? And, if you take competition first, yes, of course, we have seen an increased competition. There are lots of small, medium-sized usually PE-backed platforms that can act in our environment. Usually, private equity does not direct invest in companies of the size that we are looking for, but their platforms can do that for sure. So on and off, it pops up, but it's very dependent on in which vertical we are. There are still quite few like us that are more or less vertical agnostic. There is, of course, the big ones, Visma and Danish EG, but they have been around for almost as long as we have. So depending on which vertical we are, we are experiencing some new players coming in. And when you asked about prices, our view on last year is that initially, prices came down a bit, just due to the fact that interest rates are up, money is costing, and so forth. And we've—if something we've seen that sort of panned out, it's quite stable as it is. But of course, really nice vertical targets, they are very much in demand, so they are popular companies. Yeah, I guess so. I guess so. Good, good answer. Just to follow up there, you did six acquisitions in 2023, and that's a very good pace, and I guess that you were in many, many more discussions throughout the year. Where, where did you lose out on other potential acquisitions? Was it competitors paying up higher prices, or the companies didn't fit your criteria, or just get an understanding of what did they lose? If you, if you say so. Well, firstly, when we make an actual offer for a company, then we've already deemed them to fit our criteria. So that's already sort of taken care of. Of course, we have a large funnel. We screened nearly 200 companies last year. We made a bid for perhaps 25, and we won six out of those 25, and that's about decent ratio and an average over the years that has come in. And when we have lost, it's usually, you know, that's the price tag. I mean, someone else was willing to pay up a lot more than we were. And then, of course, it's up to the seller to decide. But I should also say that in many cases where we win, we don't necessarily pay the highest price. We pay a decent price, which the entrepreneur is happy with, and they really want to join Vitec. And one of our strongest USPs in that sense is, of course, our perpetual ownership. Excellent. Thank, thank you very much, Olle, and good luck. Thanks, Danny. The next question comes from Christian Binder from Redeye. Please go ahead. Good morning, and thanks so much for taking my question. I just have one follow-up regarding the organizational chart that you showed during the presentation. Can you elaborate a little bit more on how you see responsibility for M&A developing over time? Do you also plan to kind of delegate at least the smaller acquisitions down to kind of increase the potential number of deals you can make each year? Not in the foreseeable future. We have increased our internal M&A. I mean, you can only see Alex, who is head of M&A on the chart there, but he has two new colleagues. So we have three people working full time on M&A internally. And we like to keep that centralized, because, as we've said many times, we really believe in focus. And the managers of these companies, they need to focus on their own business and not necessarily running around playing M&A. But of course, add-ons to their existing portfolio or their existing offering, that usually comes from the business unit themselves. So of course, we have that, that kind of sourcing as well, but, they come up with an idea, and of course, they are a part of it, but, the actual M&A process, we, we handle that centrally. All right, perfect. Thank you. That was all from my side. Thanks, Christian. As a reminder, if you wish to ask a question, please dial pound key five on your telephone keypad. There are no more questions at this time, so I hand the conference back to the speakers for any closing comments. Patrik, here again. No, thank you, everyone, for joining in this morning and question. As you said, I think it was Erik who said that this was our first call, that's true. You know, we like recurring things, so we will continue this, of course, every quarter. See you next time in April then. So thanks, everyone. Thank you.