Elekta AB (publ) (EKTAB) Earnings Call Transcript & Summary

In our busy daily life when stressing to work and being in back-to-back meetings, we seldom stop and reflect about our health. We take that for granted. Well, last year, over 18 million people were forced to reflect on their health as they received the message, "You got cancer." We at Elekta wants these patients to feel that they are not alone in their fight. Our legacy in fighting cancer started almost 50 years ago, and great innovation has taken us where we are today, the largest independent radiotherapy company globally. Good afternoon, everyone, and warm welcome to Elekta's Capital Markets Day 2021. My name is Cecilia Ketels, and I will guide you to today's event. Also a warm welcome to Gustaf Salford, our President and CEO.

Thank you, Cecilia. It is truly great to be here again in a sunny Stockholm to have a Capital Markets Day, even though if it's digital this time.

That's true. And we have an exciting agenda. In brief, what are the themes?

Yes. So I will kick off with discussing a bit on the market trends and how cancer is evolving as well, then also discussing precision radiation medicines' role in cancer care and then highlight some key drivers and growth drivers going forward.

And the most essential largest part of the agenda, right?

Yes, of course. It's a strategy that we will announce today: Access 2025. So I will kick off describing some strategic initiatives and strategic pillars. And then members of the Elekta management team and representatives from around organization will describe different parts of it. So my colleague, Maurits Wolleswinkel, will discuss the innovation agenda going forward; then we will have Lionel Hadjadjeba and Thijs Van Bommel, describing his Unity journey; then we have Paul Bergström, describing and talking about the service business; and then Habib Nehme will describe our opportunities in emerging markets; and finally, Johan Adeback, our CFO, will link the strategy to our financial outlook.

And at the end, we, of course, also want to have a Q&A session.

Of course.

So please, those are listening and want to ask questions, use the telephone number that you received upon registration. But Gustaf, before we jump into the market dynamics, can you please give us an introduction of Elekta as of today?

Absolutely. Happy to do so, Cecilia. So I just want to give a brief introduction to Elekta. And we are truly a global organization with a global business, and we are continuously growing. So if you look at Elekta, we are headquartered here in Stockholm, Sweden. We have around 4,500 employees around the world, and we also have offices in more than 40 countries and growing. We're also treating more than 2 million. Our solutions are treating more than 2 million cancer patients every year. And it's installed in more than 7,000 hospitals around the world. And we're actually selling our products to more than 120 countries. So a truly global business. And we keep growing. We have now annual sales of around SEK 14 billion and our installed base is now up to 4,750 linear accelerators, Gamma Knives and MR-linac Unities around the world. And this has actually doubled since the last 10 years. How we are organized, how we drive Elekta forward is really about our business lines and also our regions. And if you look at how we report our regions externally, it's 3 different regions. It's Americas, EMEA and Asia Pacific. And you can see the revenue split is fairly well distributed between the 3 different regions and 1/3 each. Then you have our business lines, the leading dimension in the organization with clear profit and loss accountability that we introduced a couple of years ago. You have the oncology informatics solutions, really software-focused. You have the largest business line, the linac solution business line. And then you have the fastest-growing business lines, of course, the MR-linac Unity, Brachy solutions, and newer solutions we're clear #1 positions on the market. And across these business lines and regions, we have a global service business servicing all our customers and the installed base. But it could also be interesting to look a bit differently on the split of our revenues. If you look at emerging markets versus mature markets, Elekta has a strong footprint in emerging markets, 30%; and mature, 70%. Software versus non-software, then we had 25% of software business across the different business lines, and non-software is around 75%. And then as you've heard me saying many times, we have a recurring business, our service business around 40% of the overall Elekta revenue. And then our solutions or our devices is more around the 60%. But what are we all about? What is the purpose of this organization to do? It's really about cancer, oncology. And cancer impacts all of us. It is personal. I think many of you have been impacted and many of your relatives and friends, and 1 in 5 people will actually develop cancer throughout their lifetime. But it's also about that people live longer with cancer. And the 5-year survival rate has actually gone from 50% to 70% over the last decades. And it's also growing. So cancer is actually growing twice as fast than most other diseases, and it's likely to become the leading cause of death globally in the next decades. So how Elekta is working with this and our purpose is really to give hope for everyone dealing with cancer. And how we do this is really about improving the lives of patients around the world with cancer, and we work together with our customers, but also with our partners. That's a key part of how Elekta has been successful throughout the years. And our vision is really about a world where everyone has access to the best cancer care. And all of this must, of course, be delivered in a sustainable way.

So more than a year ago, we changed management team in North America. Let us now hear our head of North and South America, Larry Biscotti, talk about the change, the success as well as the development in the U.S. market.

Hello. My name is Larry Biscotti, and I'm Elekta's Executive Vice President and Head of North and South America. Today, I will share some highlights of the U.S. business and the improvements we have made since I assumed this role 12 months ago. As a company, we have a history of investing in innovative technologies that drive shorter, more precise courses of treatment with developments like Gamma Knife and MR-linac. As such, in our largest market, the U.S., our product portfolio is uniquely positioned to support customers as they look to increase efficiency and reduce the number of treatment fractions. Over the past 10 years, the average number of fractions per patient in the U.S. has decreased from 22 to 16. We fully expect this trend to continue based on several market conditions. In the U.S., the reimbursement model is expected to change from a fee-for-service model to payment of treatment per cancer type. Due to this upcoming alternative payment model, the U.S. market is highly focused on value-based care. The alternative payment model is likely to drive that number of fractions per patient further down. We also expect the U.S. installed base to remain stable as we expect a 10% rise in both cancer incidences and prevalence over the next 5 years as well as seeing a wider array of cancer cases treated with cost-effective radiotherapy. The U.S. has the largest installed base of linacs, both in absolute numbers and per capita. Today, we see that 84% of linac purchases and our plan with stereotactic capabilities to reduce treatment fractions. Additionally, given the highly competitive nature of the U.S. market, differentiating technologies are also in demand, such as real-time imaging and adaptive radiotherapy. As such, our investment in MR-linac with Elekta Unity has differentiated our portfolio in the market and opened doors to new clients. During the last 12 months, we have grown our orders volume, installed base and share in the U.S. market. I believe this is also a direct result of organizational improvements and new commercial strategies. First, we've implemented what we refer to as the zone community structure to build an agile and more intimate customer-facing organization. It's a full geographic alignment between all customer-facing functions such as sales, service, training, contracting and accounts receivable into 5 zones so that the local teams can quickly make decisions and better serve each zone's customer base. Second, we are focused on strengthening the internal culture in the U.S. Based on Elekta's values, we've added some specific cultural pillars to energize the team and build the foundation for success in our zone communities. These pillars permeate our organization at every level and have led to some of the highest employee satisfaction scores in U.S. history at Elekta. Third, we've initiated new models for sales channels and market segmentation strategies. We specifically targeted some of our largest, most significant customers based on 2 areas: service and software, where we have assembled dedicated sales teams and a renewed commercial focus. We view services and expansion of services as a significant growth opportunity, focusing both on existing and new product offerings. We're additionally heavily focused on oncology informatics solutions, which is our largest installed base and an area of the portfolio that will continue to strengthen in years to come. Lastly, we have ambitious plans and continued focus on strategic accounts, large group purchasing organizations, niche segments and other consolidators in the U.S. market. All these commercial actions continue to strengthen our position and visibility to the overall radiation oncology market in the U.S. We will continue to improve Elekta's competitive edge in a market that needs an innovative, flexible and responsive provider. Given the recent changes in the competitive landscape, we are the largest whole portfolio independent company focused on radiotherapy and have a great opportunity to better serve our customers in a fast, intimate way. As you can tell, I'm very optimistic for Elekta's outlook and future in the U.S. market. Our product offerings, commercial structure and culture of positivity have better positioned Elekta to consistently grow our business in the U.S. Thank you for your time.

Sounds good to hear. Larry talked about value-based care and more cancer type being treated with radiation therapy, all important trends driving Elekta's industry. Well, Gustaf, in reflecting on the market dynamics, let's take the patient's perspective first. And you said previously that people live longer and that the survival rate has increased. How does this development look like?

Yes, if you've seen, as I mentioned before, over the last couple of decades, it's been an amazing trend that the improvements in cancer care have resulted in longer life expectancy and people live also longer with cancer. So you can see on the picture here in the back that the cancer survival rates has gone from 50% up to 70%. And you have certain cancer types like breast or prostate or skin that is now over 90%. And we expect this to continue. But at the same time, the pictures were mixed. So if you look at cancer types like pancreas or lung or liver, the survival rates are much lower. So I think the key thing here is improving operational efficiency. When you think about cancers like breast and prostate, so more people get access to it and new innovations in that area to further give accessibility to cancer patients around the world. But if you look at the cancer types that is with lower survival rates is really about improving the clinical outcome. And I think Unity, the MR-linac is a key trend here and a key differentiator that will help patients going forward.

Yes, that's really an encouraging trend for the cancer patients around the globe. And how are you thinking when it comes to the access of radiation therapy in the different parts of the world?

Yes. So if we take the more regional perspective or country perspective, it's also a very mixed picture because you will have countries with good accessibility to linear accelerators. And you can see on this picture that countries like the U.S. or Japan or Western Europe, there are often more than 4 linacs per million of population. But at the same time, for the rest of the 85% of the world's population, it is really limited accessibility to cancer care, but also for radiation therapy. And the trends here are a bit different as well. So I think for the more mature countries with a larger installed base, it's really about improving the clinical efficiency with better innovations, but also local proximity because we can take a region like Europe, there's big variations in accessibility in quite a mature region as well. But if you think about the 85% of the world's population, it's truly about developing the infrastructure and also improve availability across those regions. And some countries today actually do not have access to radiation therapy at all.

That's really tough. But how large is the gap there?

Yes. So if we quantify these 2 pictures, we see a gap of around 15,000 linear accelerators around the world. I often say that every second cancer patients should receive radiation therapy, and it's actually part of 40% of the curative treatments, but that access is not there today. So that's what we are really focusing on and supporting our customers and their patients to close this gap.

So what do we, Elekta, do to improve their access around the globe?

We do a lot of things. Of course, it's through innovation. So we develop products that is a good fit with closing this gap. And I think Harmony is a great example about -- around that. But it's also about supporting customers with customer finance, helping to get to the right reimbursement levels around the world. And also about education and training is actually one of the biggest issues there is in many markets that we need to help our customers to be trained in radiation therapy procedures and processes. And it's important to say, if you think about the full cancer care budgets around the world, radiation therapy is actually only 5% to 7%. And I believe that should increase going forward.

I see. So what are the key drivers going forward as you see it?

Yes. I think key drivers for me, and I try to summarize it here in 4 key drivers. And I mentioned improved infrastructure and radiation therapy access around the world. It's also about the growing cancer burden. That this gap, if we don't do anything about it, will just widen. It's about continued adoption of cost-efficient and value-based care. And you heard Larry Biscotti talking about a couple of these trends in very mature markets, the U.S. with the alternative payment model. We have also seen during COVID that radiation therapy has been used in a more surgical way in parts of Europe like the U.K. as well, reducing the number of hospital visits for cancer patients. And then breakthrough technology advancements, I think something Elekta always has been standing for. It's a legacy in what we drive forward. And I think you have examples of Unity, you have examples of Harmony, and we have a lot of example around our software portfolio. But we cannot do this alone. And I think cancer care is truly a team sport. So market collaboration throughout the cancer care ecosystem is increasingly important as well.

So if we reflect on this market trend and try to qualify them -- quantify them, how will that look like?

Yes. So we worked hard to quantify these trends and looking forward, what we expect from kind of the health care expenditure, GDP development and so on. And the RT market in totality is above $7 billion. And the growth rates going forward, what we have in our midterm outlook is 6% to 8% of CAGR until '24-'25. We expect the emerging markets to grow 8% to 10% and more -- the mature markets more around 2% to 4%. Software has been shown during COVID, but also going forward, we expect to be a key growth driver at 7% to 9%, and then the solutions to our devices more around the 5% to 7%.

Great. So that was the update on the market strength. Now I know that you want to present our new strategy that you and the management team has developed.

Absolutely. Thank you. So really happy and proud today to present our new strategy, Access 2025, is something Elekta and the management team has been working on throughout the spring here. And it's really linked to our vision towards a world where everyone has access to the best cancer care. And if you think, what do we mean about -- what does access to the best cancer care mean for Elekta, it's really about 3 things. We say it's availability of care, and we've set a very ambitious future milestone in 2025, that 300 million people should get access to radiation therapy through Elekta solutions with [ 800 to 1,000 ] additional Elekta linacs in underserved markets. We also see elevation of care. So elevation of care for Elekta means that we should double the clinical usage of short-course treatment or hyperfractionation, and we should credible the adaptive treatments among Elekta's customer. And the third trend is really about participation in care. It's about the patient's journey. So 20% of Elekta's customers patients are actively interacting with their own care journey. And today, it's only 1%. And [ Tycho ], our new offering, will have a key role to play here. So our strategy and how we built it up is really linked to a world where everyone has access to the best cancer care. And the first pillar, of course, is around innovation. It's the key thing that Elekta always have stand for and also linked it to the customer utilization in mind. That's a vital part of our strategy and how we develop our innovations, always in partnership. But we've also seen the need for partnerships and partner integration increase across the cancer care continuum. And it's key also to be the customer lifetime companion and our service offering and our installed base is absolutely vital. Linear accelerators often out in installed base for 10, 15, maybe something -- sometimes 20 years. So we are truly our customers' companion throughout this journey. And lastly, drive adoption across the globe. We have this gap of more than 15,000 linacs that we work hard the whole of Elekta to close every day. So who are doing it? It's, of course, our people. Our people are absolutely vitally crucial for us to deliver on this strategy of more than 4,500 employees. And we've also shown throughout the pandemic that we've initiated a lot of resilience and process excellence activities around the organization, making us, coming out from COVID, as a stronger company. All of this needs to, of course, be delivered in a sustainable way. All of our strategy is linked to sustainability initiatives. And if you take the sustainability lens on our strategy, it's really the flip side of the same coin. Strategy is linked to sustainability. So we need to have the long-term growth from our strategy, but it needs to be delivered in a sustainable way. And it's about the ESG targets, environmental, social and governance. So if we start with the environmental targets, Elekta has just signed up for science-based targets to cut our CO2 emissions in half until 2030. We are also supporting green procurement and circular business models across our business lines and regions. On the social side, we will initiate a sustainability-linked bond after the summer linked to our target or a milestone that more than 300 million people in underserved markets should get access to our products. We are building diversified teams and addressing the human capital challenge in our different markets. And of course, as the foundation for everything we do is the governance aspect. It's about ensuring a market free from bribery and corruption and also safeguard a culture of high business ethics and integrity. So how will we launch this? How will we operationalize and implement our strategy. And I think it's good to start in last year anyway, where we had a year of adjusting to the new normal. It was about launches. We launched Harmony. We launched software across our business lines and portfolio. And we booked the 100 Unity order here in Q4. Today, we announced a deepened strategic partnership with Philips. We strengthened our direct sales network in many countries and regions, and we also drove a lot of resilience and digitalization efforts across our organization. So what's next? If we look into the midterm perspective, the midterm outlook, it's really about profitable growth, but it needs to be delivered in a sustainable way. We will drive our initiative around our new software platform. We will accelerate our journey with adaptive technology with Unity in the lead. We're also deepening existing and form new partnerships. We will expand our services offering. And we'll also further optimize our sales network, establishing direct presence in key growth markets and will drive operational leverage throughout our P&L. All of this needs to be delivered and supports what we signed up to, the science-based target until 2030. But if we look ahead, if we take the long-term perspective, It's really to continue, as I think Elekta always have been doing, driving paradigm shifts. So it's about developing a next-generation treatment workflows and customer engagement models to improve patient access to the best cancer care. And today, this morning, I'm really, really excited to say that we announced the strategic partnership, a comprehensive partnership from innovation to distribution between Elekta and Philips. And we share the view about precision, the precision in oncology. And we are 2 companies, but we share one vision. And if you break this vision down a bit, we focus on 3 key areas. It's about the breadth and depth of our solutions together. So it's really about end-to-end cancer care continuum. and coverage our best-in-class solutions, both from the Elekta side and the Philips side. It's also about personalized therapy. And I think that's a key word because we need to streamline the workflows and also have the adaptive treatments to really truly personalize cancer treatment with precision radiation medicine. It's also about the informatics. It's about integrated informatics. And historically and today, in all our discussions has been ongoing now for almost more than 6 months, we share a view on open architecture and vendor-agnostic solutions. So I think it's amazing that we today launched this partnership, and it's built upon our Unity partnership, of course, but also expand it into new areas. And Maurits will talk more about it in a coming session here. Thank you.

We just heard Gustaf emphasizing the acceleration of our innovation. So let's do a deep dive into this segment and talk to the person who is driving these projects. But first, look at this. [Presentation]

I'd like to welcome Maurits Wolleswinkel, our Chief Product Officer; and also the head of the business line, Linac Solutions. So to start off with, when we talk about product segment, we split it into 2 segments. Can you start by stressing the difference between these two and why it's important to keep in mind?

Thank you, Cecilia. Absolutely. I love to do that. So 2 distinct segments: comprehensive oncology care solutions on one hand, and the RT treatment solutions on the other hand. So starting here, what characterize this segment? It stresses beyond radiation therapy. And that's important to mention there as well and really looks at the entire cancer care journey. The second element related to this is that you see a much higher level of customer configuration. You see new emerging applications in that space, like the patient reported outcome, patient engagement in general, clinical decision support and all these new capabilities and need also offer the potential for more professional services. So that's this side of the segment. The other segment, you could say, is a more traditional device segment, device with a much more stronger role of software moving forward. So we see our treatment management software as part of these devices becoming much more integrated and the interplay between the devices and the software becoming more and more important moving forward.

Yes. And before we go to the future, which we, of course, everybody is waiting for, can you please reflect on the past year?

Absolutely. And I have to say this is something that really fills me with pride because it was not an easy year. A lot of us have been working from our home office. Also our engineers, they had to innovate from home. That's a new experience. But what really fills me with pride is that we have been able to introduce a number of new solutions across the entire portfolio over the past year. We introduced them a little bit differently in a few -- in a fully digital way, but not less successful, I would say. And let me mention a few, Gamma Knife Lightning, a new solution for the Gamma Knife to really accelerate the treatment and makes planning simpler. We also introduced a brand-new Monaco release, Monaco release that has really packed a number of new clinical capability as well as workflow advancements. We introduced Elekta Studio an integrated suite of imaging in brachytherapy that we also launched this year. And then, of course, Harmony, the new linac that we brought to the market. And finally, a brand-new MOSAIQ release. So all in all, this shows also the resilience of Elekta as a company.

Great. And can you now lead us through how the Access 2025 will transfer to innovation?

Happy to do that. And essentially, and then I go back to the 2 segments in the market, it really drills down to 3 focus areas. And let me go them -- to them one by one. So the first one is really about personalized precision. And personalized precision in the RT treatment solutions space means something different. It's really about integration of imaging and the adoption of adaptive treatment. And we really believe that we are at the brink of a new wave of innovation and adoption of novel new workflows in radiation therapy. On the other hand, we see the role of combination therapies emerging, the need for clinical decision support, but also the role of the patient evolving. So personalized precision is the first one. The second one is really about elevated productivity. And again, elevated productivity means different things in different spaces. But what they have in common that software plays an increasing important role in how we manage productivity: by streamlining workflow, by smarter capacity management, but also by bringing mobility of care to our customers as well. And the third one is maybe the most important one because it really ties all the spaces together is what we call integrated informatics. An integrated informatics derives from the fact that intensive care, we have enormous amount of data being generated by the devices but also by the supported software. And what we believe is by basically unlocking that information and turn that into novel applications, we actually can accelerate precision and productivity, on the other hand. So that's why it's also important that Elekta as a company, continues to aim to play in both spaces because it's so important to connect them together. And this is not only a story around the future, a future strategy, a future direction, but we are already bringing that to life in today's solutions. And let me give you a few examples. And the first one is the Elekta Harmony. Elekta Harmony was actually innovated and developed with a very simple aim in mind. How can we improve the productivity to 25%. And as a result, we have completely redesigned the in-room workflow. Harmony is doing very well. [ If ] approved, we expect 510(k) any moment. We currently are sold in 11 countries already. We have treated the first patient. But we also think that actually Harmony will contribute to further improve the profitability of the linac segment. Another point to maybe stress as well that Harmony actually is addressing 2 market segments. So we have the Harmony in the value segment, but we have another Harmony Pro configuration version that is addressing the performance segment. So it's really a very important introduction for us at Elekta. Let me give you a second example. An example in the evolving what we call the treatment management software. As said, we just launched a new version of Monaco, and that's a very large, substantial release, and it contains a number of new things. The product, by the way, is as MDR -- is MDR released. It's FDA released as well cleared. So we are really ready to sell the product. But one of the things that is in Monaco 6 is that we bring back proton therapy planning through our collaboration with IBA back in treatment planning. And we're extremely pleased by that, proton therapy planning is an area that we believe is important still. We want to support our customers. We started our strategic collaboration a couple of years ago, and now we see it coming to life in this product. Monaco also contains a number of workflow improvements. And the best way to demonstrate that is to have a customer talk for you. And in this case, it is GenesisCare, one of our largest partners and customers at Elekta that are also one of the first adopters of Monaco 6. And they're extremely pleased in how Monaco 6 is helping them increase their workflow and productivity, and they are currently expanding the rollout of Monaco across their network. So that's the TPS side of things. Now we're also moving in new areas when we talk about treatment management software. Another product that we are having very much related is what we call ProKnow. ProKnow is a cloud-based review application where analytics are completely integrated to continuously elevate care. And recently, we closed an agreement with the Department of Veterans Affairs in the U.S. to adopt ProKnow across their entire network. All their treatment plans will be uploaded into ProKnow and used as a basis to continuously improve their care. We see the role of ProKnow evolving, and we see more and more a stronger interplay between ProKnow on one hand and Monaco to a blended set of treatment management applications. And this fall, for example, we will introduce one of the first artificial intelligence-based auto contouring applications on this platform. The third example I wanted to give is MOSAIQ Plaza. And I'd like to stress here the word Plaza. So why did we come up with this concept of MOSAIQ Plaza introduced around 2 years ago. It really relates to this notion of integrated informatics, where we have more and more partners and new applications sort of cooking onto that same core called MOSAIQ. That's why we call it MOSAIQ Plaza. And to give you 2 examples in this respect, SmartClinic, a new application that Elekta brought to market, very successfully simplifies workflows, efficiency brings mobility of care also to the user. You can use it everywhere. We're very successful with it. We have almost 150 orders, 50 clinical sites live. And more recently, we added Kaiku Health, a patient-reported outcome tool also to the Plaza. So just 2 examples in that space as well. But the next part of the journey is what? So where are we going moving forward? And my simple word is acceleration. Acceleration is that's what we're after. How? By partnering, by new software platform by also simply investing more money. So let me explain that in a little bit more detail. So if we take these 3 focus areas around precision, productivity and integration, these 3 elements, we are really focusing on the 3 things I just mentioned. So the first one is really about the digital software transformation that is already ongoing. And one key point to mention that is that digital transformation is not only about future-proofing our software, but also to bring new capabilities to our customers and new services as well. The second one is around strategic partnerships, and we have a lot to announce, of course, today. Strategic partnerships while staying agile and customer focus in the meantime. But we believe that the strategic partnerships are essential for our future as well to have access to certain capabilities we don't have, but also to team up in larger comprehensive commercial relationships. The third element is about capability expansion, investing in more people and capabilities. But one point to take out there as well that we specifically will focus on artificial intelligence and really are going to and are in the process of doubling our efforts there. And as a consequence, yes, we will increase our innovation spend moving forward. So let me go through these topics one by one in a little bit more detail, starting by the digital software transformation. But then it's important that you first take a step back, that I already started my first introduction as well that the role of informatics is changing. And it's good to mention that as well. So the traditional role of an OIS, that's how MOSAIQ as a product started, is really changing and expanding. We see more need for multidisciplinary decisions, clinical productivity tools, patients will more actively interact and the mobility of care being able to work anywhere, anytime. So that's more on the OIS space that we need to enable with this more -- maybe this new platform. When we look at the treatment solutions, on the other hand, we see other trends and other trends of more closer integration of treatment management sell software with the device for a good reason. First of all, the role of imaging has become so important moving forward that image guidance is essentially standard we see. Secondly, we see also a continued involvement of real-time motion management. Currently, really spearheaded by Unity, but we see that trickling down in all our treatment solutions. Then the third element is the emergence of adaptive radiotherapy. And adaptive radiotherapy basically means that we continuously change the plan based on the anatomy at that moment of the time. And finally, what we see also more and more that software becomes smarter and can really unleash all the capabilities of the hardware by deeper integration and interoperability. So we took these sort of future-oriented needs into mind when thinking about the new software platform that we are currently building. And we defined 3 sort of core aims for this platform: to innovate faster; secondly, that we create a smoother and more unified user experience across our solution; and thirdly, that we streamline our workflows, and that is very important to also support the increased productivity that all our customers are asking for. So what are we doing? We have already established a central platform organization. We are pretty far down the road, and we now start to build the first applications on top of that software platform. And just to give you an indication, today, around 20% of our engineering base is already working on this new software. And in the next couple of years, we will further expand our engineering base with over 25% mainly in software. Then let's talk about partnership and strategic partnership. And of course, today, we have a big announcement to share with everyone. And that's our partnership with Philips. And I'd like to stress here as well that this relationship and what we agreed and announced today is very comprehensive in nature. We've been working for 8 months behind the scenes to really work through a number of things and closed a number of agreements with each other and now today, finally, we are ready to announce the partnership. And it's really ranging from commercial to joint innovation. But here, I'd like to mention one specific commercial arrangement is that MOSAIQ Plaza, that I already talked about, will be expanded with 3 products from the Philips portfolio. And Elekta will be the distributor for that product, tumor board orchestration, genetic tumor boards and oncology pathway software. So as I said, it's a very comprehensive agreement that we announced today. What I would like to do now is to drill down a little bit deeper on the innovation side of that. So there are essentially 4 areas where we will extend and deepen our relationship. The first one is basically expanding what we already have in place, expanding our collaboration on magnetic resonance radiation therapy. The second thing what we are working on is what we call an integrated simulation planning treatment workflow. So both companies, Elekta and Philips, recognize that the days of an independent treatment planning systems maybe will be over in a decade from now. And we are going to team up and work together to really build this world-class simulation planning treatment workflow together. Thirdly, we will further expand of integrated imaging and image-guided capabilities. So yes, we are already working on Unity, but we see capabilities in other modalities as well. And finally, clinical decision support. We will distribute the products we have today, but we also see joint opportunities to deepen, integrate the software products with each other and develop new opportunities along the way. My final part is about AI and the allocated investments we are doing. And really, we have a clear vision of where we want to go. And AI is really enabling a number of things in our field, whether it's helping to enable adaptive radiotherapy, smarter resource management, automation of nonclinical tasks or clinical operational insight, we see a lot of opportunities moving forward. We also announced this week a close collaboration with the NKI, the [ Amsterdam Free University ] and Elekta and the Dutch government called POP-ART, Partnership for Online Personalized AI-enabled Adaptive Radiation Therapy. It's just one of the example of how we are accelerating our efforts in AI. A lot of investment also happening on the infrastructure side, working with partners on the technology, but also to access specific end-to-end data set to really apply AI to it. So all in all, a very comprehensive activity.

Maurits, it sounds like plenty of exciting initiatives to shape the future innovation. But before we leave this subject, can you please highlight the effect these initiatives will have on our product portfolio?

Absolutely, Cecilia. And I said it's all about acceleration, but how does the acceleration translate to our products? That's the question. I make it very simple. Just starting with the first slide almost. Linacs, it's really about bringing new linac systems to the market, new linac systems, including adaptive workflows. For MR-linac, it's really about further expansion of real-time capabilities. That's what we see over there. For the Gamma Knife, it's about efficiency and also bringing in AI and automation to it. Brachy will continue to expand its image-guided capabilities. And finally, the informatics business line will continue to work on these new applications that are added to the Plaza for patient engagement, workflow management and clinical decision support. And all in all, very important to stress at the end is being supported by a joint software foundation to streamline workflow automation and productivity.

Thank you very much, Maurits, and it's great to hear about the next part of Elekta's innovation journey. Another innovation has been on the market since 2018 is our Unity, driving a paradigm shift has many dimensions, and that's why we put up an organization around this product. And in just a minute, you will meet the head of this business line, Lionel Hadjadjeba, and his colleague, Thijs Van Bommel, who is the Head of MR-Linac Marketing and Sales. But first, let's listen to what some of our customers have to say about Unity. [Presentation]

It's inspiring to hear those enthusiastic customers talking about Unity. And with MR-linac for the first time in history, we actually see what we treat. And I'm extremely happy to update you on the successful journey together with Dr. Lionel Hadjadjeba.

Thank you, Thijs. At our last Capital Market Day back in 2018, we celebrated the CE certification as well as Unity going clinical. Since then, a lot has happened. We are now in the second phase of our commercialization. And while we usually do not disclose the number of Unity sold, the contract number 100 was signed in April with St. George in Christchurch, New Zealand, back in April. This is really a great celebration we have here, and this global footprint is clearly showing the worldwide confidence and capabilities of the Unity system. In the Americas region, we sold over 30 systems, so this region is very important in the MR-guided radiotherapy message. But also in Europe, we see a footprint in all major countries. And in China, after receiving regulatory approval in the second half of 2020, we have already sold 10 systems. The market adoption in Asia Pacific and in Japan is also taking off. Despite COVID, we've sold 20 systems in this region of the world. This is really a great geographical expansion in such a short period of time. But let's talk about how Unity is used nowadays. Of course, so we've treated over 40 clinical indications, and this really helps us in understanding the clinical value of the Unity system. So on one hand, we are bringing down the number of treatment sessions per patient, which we call, hypofractionation or ultra-hypofractionation, for instance, used with prostate. And on the other hand, we are addressing the difficult-to-treat cancers like liver and pancreas, for instance. One specific indication I'd like to mention is the oligometastatic treatments. Due to cancer returns, this is -- this indication is rapidly increasing. And our consortium has done a phenomenal job in using the Unity system for this clinical indication. This is highly impactful. To date, we have than 500 clinical abstracts and over 350 peer-reviewed articles. So the consortium and the momentum form the powerful infrastructure for this clinical evidence journey we have with Unity. And over 50 consortium sites and more than 600 researchers are working on a day-to-day basis to unleash the potential of the system. As a matter of fact, those very good clinical results are the foundations of our plan for reimbursement specific to MR-guided radiation therapy. The first step was to get access to all major markets, which is -- which has been achieved. Then we are focusing now on pancreas, liver, prostate and oligomestasis, as you mentioned. And the plan is to ensure that we will file for reimbursement in the major countries and regions, namely the U.S.A., China, Japan as well as Europe. And we plan to file our first reimbursement submission already this year. And we also have a fully dedicated health technology assessment/reimbursement team at Elekta to ensure that we roll out our plans according to our strategic plan. It's really, really good to hear that we are working on that reimbursement because we know it's crucial for the success of Unity. On the other hand, we also work on proceeding the technological developments of the system. And when we initially designed Unity, we distinguished ourselves in the market by taking a very detailed look at the choices we have made from the beginning and to assure that this is a future-proof concept. So we combined a high-quality linac, together with a high-quality imaging device, the MRI, without any interference between the linac and the MRI. So design, technically, no compromises were made. And this is very important to provide our caregivers with the best diagnostic image quality to enable them to target a tumor and to save the healthy tissue by real-time virtualization. This platform also enables us to do further workflow optimizations. For instance, the high-quality auto controlling module, which will significantly reduce the treatment time for patients. And also the high-image quality will enable us to automatically respond to motion. The first start here is to automatically switch off the beam, which we would call automatic gating. But the Unity design allows Elekta to take the next step, which is following the tumor real-time with the beam. This will significantly change radiotherapy practice. Another unique feature I'd like to mention is the tumor response assessment. This is really to look per patient if the tumor responds to the radiotherapy treatment. And this is the ultimate form of personalized radiotherapy treatment. As an oncologist myself, I find those prospects amazing and also very exciting. And while we work with our customers, our partners, to push out the boundaries, medical and technical boundaries, we as a company, are also working on improving our margins. I will give you a few examples. The first one is installation. We reduced our installation time by 65% since the first commercial installation. Reducing installation time means also less bunker time blocked for the customers, but also for us, much less installation cost. We also are reducing our cost of goods sold, the famous COGS, and we have a plan to further reduce them over the next few years. And if you add all those together with the fact that we have 100% attachment rate of service, and service is a very good margin business for us. And you multiply it by the number of Unitys that we're going to be selling in the near future, our future is bright.

That's really nice to hear and important to hear. But can you also tell a little bit about the installed base we have today?

Yes. Sure, Thijs. We have today registered in most major countries. We have also installed over 40 system, of which 26 are clinically treating patients. Many centers are ramping up to treat over 10 patients a day with 5 fractions or less. That means that the patient will only come 5x or less compared to the regular linac treatment time, which require patients to come to up to 35, even 40 times. So a lot of time saved for the patients. One of our customers is leading a study called HERMES study, which is a prostate cancer study, and they will compare 5 fractions versus 2 fractions, which is an amazing move towards better quality of life for patients.

Impressive to hear. And in other words, this is really a paradigm shift in radiotherapy. We -- as I mentioned in the beginning, we really see what we treat, and we are able to act on the motion. And this is also confirmed by recent market analysis. We've taken a detailed look at the clinical indications that could benefit from Unity treatments. And we've taken a realistic approach where we see that 12% to 15% of all cancer incidences would benefit from MR-linac treatments, and that translates to 25% to 30% of all radiotherapy treatments. So this really confirms the huge potential of Unity MR-linac.

Indeed, Thijs. Let me conclude, MR-linac is a real paradigm shift in radiation therapy. Join us in the Seeing is Believing Revolution with Unity. Thank you.

Thank you, Thijs and Lionel for this update. You heard them briefly talking about the benefits of the MR-linac. Let us now connect to one of our customer, Dr. Arjun Sahgal at the Sunnybrook Health Science Center in Toronto. And here, get a deeper understanding of his view of this benefit. And Dr. Sahgal will be in a discussion with John Christodouleas, who is sharing his time between being an oncologist in Philadelphia and working for Elekta as the Head of Medical Affairs. Over to you, John.

Thank you, Cecilia. My name is John Christodouleas. I'm one of the radio-oncologists in Elekta's Medical Affairs team. I'm here today with Dr. Arjun Sahgal from Sunnybrook at the University of Toronto in Canada. Thank you, Dr. Sahgal, for your time.

Thank you very much, John.

So we are here to talk little bit about MR-guided radiation therapy and Unity. And the first question that I'd like to ask you, Dr. Sahgal, is how do you explain to your patients the value or the benefits of online adaptive therapy and, in particular, online adaptive with onboard MRI?

Really, the way that I explain patients is that for the first time, we're basically opening our eyes. In the past, we'd get an MRI. And 3 months later, so you'd have radiation, say, for 6 weeks, then you have a month off. And by 3 months later is your next MRI or your next image. And patients ask me, how is treatment going? I can say, well, you're doing pretty good. And now I can tell you exactly how it's going every single day. And before we begin to delve into the benefits of adoption and understanding the radiation map, just the mere fact that they're getting feedback in real-time about their tumor wants -- makes patients want to go on that unit.

So let me ask you, many radiotherapy departments have MR simulators in the department. And of course, most hospitals in the West will have access to diagnostic MRIs. Do you think that the benefits of sort seeing what you treat could be replicated by sending patients to the diagnostic radiology department?

Yes. So that's a great question and it's, again, one that comes up very often. And I can tell you after having done it, first of all, we're not going to be able to send a patient every week to diagnostic imaging for a full-blown MRI and nor should you. You don't need the whole battery of MR images on a weekly basis, say, forget daily basis. But even if you said once, say, weekly, you can't do it. A, it's not appropriate medical resource allocation. It's expensive to the system, and I don't need all that information. What I need is that snapshot every day to verify the tumor, make sure I'm hitting it and make changes as I want to. And that's why it cannot replaced by the simple understanding of, "Oh, I could just put them on MR simulator or send them to diagnostic imaging if something changes clinically." First of all, how would you even know with a cone beam CT? So I think that paradigm changes dramatically once you start using it. And once you start using it, you're not going to go back. The evolution was 2D, so X-rays to 3D based on bone anatomy only, to now seeing the tumor. And so we're following that trajectory as the technology improves, and we're never going to go back. Once you start seeing the tumor, you're never going to go back to a place where CT bone-based matching.

Yes. I think that's a very powerful way of describing it through the history of radiotherapy in terms of its imaging, the natural progression in here. And of course, we don't go backwards in that progression. Once you start to see, it's hard to go back, like you said.

Absolutely. And even for us in the brain, I mean, it was very intuitive to us because we use MR all the time as opposed to some other indications or anatomic organs. But now that you've been able to do it and see it, even those nonbelievers that can say, "Oh, we can just -- we can do it at CT. We see it enough." Now they're actually asking for it because they want to see it. It's the same thing. You're delivering better care. You're doing more for your patient, and you're getting to where we need to be. And I'll tell you in a relatively controversial statement that we are getting towards a more surgical specialty. Especially with hypofractionation or stereotactic body radiotherapy, the word ablative gets used a lot. And the only way that you can really say you're delivering in a blade of therapy now and having that mode of therapy like an intervention when you put a probe in and burn a tumor in real time, the only way that we actually can truly say, we know what we're doing, we're approaching in a surgical way is if you can see the tumor every single day and blast it with a high dose of radiation every day.

Right, right. You can see it while you're doing it in a way that a surgeon sees while they're cutting.

And that's a big departure for radiation oncology because we weren't trained like that. And now we've had to retrain and think like that and be there, hands on, and do it. And once you start doing it, it changes the game of radiation oncology globally.

Let's just think for a moment here. Let's just fast forward 20 years since we're talking about the future. In 20 years' time, what proportion of patients do you think might be treated with online MR-guided adaptive therapy? Wild guess. Obviously, won't hold you to it.

Well, the thing is, in 20 years, hopefully, everyone's alive and not susceptible to COVID anymore. But at the end of the day, when we start treating curative patients, I think, every single patient is going to need tumor-directed radiotherapy. And so that -- by meaning, you want to see the target. So it's not going to be a situation where we accept not being able to treat the actual tumor and using a bone surrogate. There may be some palliative indications still. There will always be some degree of simple radiotherapy, but my anticipation in 20 years is that cone beam CT will be completely phased out.

Interesting. So I mean do you see merit in the strategy of doing CT and cone beam CT-based online adopter for the things that might be visual -- visible with CT?

So it's an interesting question because if you think of some tumors where you could see a CT -- with the CT, and some of the CT image guidance is getting better. So you can at least see it enough to know you're hitting it. But are you able to see it enough to understand the pattern or progression of how that tumors changing. And you cannot -- you can't do it unless you have an MRI. And with the advances in the MRI -- and that's why we want a high-field strength MRI, we're not going to go for something that doesn't allow us to be in the future now. And that's what a high-field strength MRI does. You can actually see how that tumor is changing and then make your adoption. On a CT, you could maybe adapt to the position, but you cannot adapt to the tumor morphology and pattern of spread.

You obviously made the decision to go for a high-field versus low-field. What was your thought process there?

Well, the thought process was this. When we looked at some of the technologies with low-field strength MRI, it was too crooked. Just the ability and the flexibility in imaging was too crooked. So right away, if it was a simple situation where we simply maybe wanted to gate and use some crude marker of how things are moving and then adapt radiotherapy plans on that, maybe it would have been okay, but we weren't interested in that. We wanted to go for the future now. We wanted to also develop advanced MRI. So with our research institute, we want to be where we're going to be in 10, 20 years in the next 3 years. And the only way we're going to do that is with the high-field strength MRI. And even that is a challenge at a 1.5 tesla MRI, but we're getting there. And that's because the computing power is so great now that we can actually use those MR images and understand them better. You will not be able to do that on the low-field strength MRI.

So how would you -- I think you're alluding to biologic adaptive radiotherapy and sort of the potential of using quantitative or functional imaging or biological imaging. How do you explain that to a patient? Or how -- do you feel like patients will understand that story?

I think so. When you explain to them that, look, the entire tumor doesn't behave necessarily the same. There are going to be pockets that are aggressive. There are going to be pockets that are not aggressive. We simply treat the whole thing as one because we don't know. But if we could understand where the aggressiveness and nonaggressive is, then we can differentially radiate the regions of the tumor. And this has been kind of the holy grail of reducing toxicity and improving cure rates with radiation, but we've never been able to do it. And the only reason why you're able to get into this paradigm is because of the MR image guidance.

So how do you feel now going into the treatment? How do you feel differently going into the treatment, knowing that you have all this information available to you? What's that like for you as a physician?

I'll give you one word, it's called relief. When I know my patient is going on the MR-linac, I feel a sense of relief because I know that patient is getting the best care possible and I'm going to know what's happening to that tumor through that journey. And when they say, "Oh, I got a little bit more headache." I return to the image and say, "No, everything is actually okay. You just have a headache." But if I see a lot of swelling, I'm going to be like, we got to start some medication, and let's figure it out. So it's a sense of relief that I have, and that's an overwhelming feeling, not only for the physician, but also for the patient.

I bet if your patients hear you say that, that, they will feel great relief as well. Dr. Sahgal, thank you so much for your time this evening. Really appreciate it. With that, I'll pass it back to you, Cecilia. Thank you very much.

Thank you, John and Dr. Sahgal, for sharing your view with us. Last Friday, we had the last MR-linac consortium meeting. And in this meeting, there were more than 650 participants from 19 countries discussing the use and the processes and research paper of our MR-linac. Gustaf, what is your reflections after this meeting?

It's absolutely fantastic to follow the progress of the journey with Unity but also how our users continue to come up with new ways of treating, new ways of doing the studies with MR-linac technology and the Unity. So here, I have a picture on kind of the Unity evidence development journey. And I think it's important to say that it's 3 key phases: It is technical studies phase that started already from 2017. What can you actually do with machine, diffusion weighted-imaging, for example, how you can track the monthly collimator? Then we kicked off the Unity study, sort of the MOMENTUM study in 2019, really building the data generation, 6,000 patients over 5 years, and we're well into that study right now. And you see all these published papers and also the patients treated. And then we've just kicked off and started the superiority studies. That's really about building the clinical evidence that we, of course, get a lot of questions about. And here, you can see a couple of studies on the slide I show here. Throughout this period, our customers can use the existing reimbursement code. That's the question I often get from people. Okay. So how is this actually reimbursed? But today, you can use existing. And then often, our customers have their own private insurer schemes and so on reimbursement setups. But going forward, the ambition, of course, is to go into the third phase of Unity, and that is when we have the reimbursement in place. And that's also you see in this kind of slide that we go from proof-of-concept to data generation to clinical evidence. And we said that, that's post 2022 where we go into that journey.

And I know during the consortium meeting that was the whole week last week, there were more than 100 abstract that was submitted. Can you give us any research updates?

Yes. I have a bit of breaking news from Canada consortium, some of the studies that came out. And we really see a great progress in the clinical journey, and we have a couple of new studies, and I showed some of the Q2 and Q3 as well. But we have a very interesting study on head and neck cancers. That's the combination of immunotherapy and MR-linac-guided radiation therapy. And we see that's a big promise of this technology, when you can be so precise and also combine it with immunotherapy for head and neck. Another study is around kidney cancer, and kidney cancer is a cancer type that's very resistant to radiation. So -- but when you can become so precise, then you can treat kidney cancer also in a better away. And there was a study on that as well. And the third area that I think is really promising and very interesting as well is rectal cancer because rectal cancer also do a combination of radiation therapy and surgery. But I think being so precise as you can be with a moving target with Unity-enabled treatments, then it can become more surgical as well. So I think here we have a couple of examples from the studies that came out from the last events and the last MR-linac consortium meetings.

Thank you very much for this very latest news.

Thank you.

And now we will take a short break. And after the break, we will be talking about the business that accounts for 40% of Elekta's revenue. Stay with us. [Break]

Another key element of our strategy is our Service business. And with me here, I have the Head of Global Service, Paul Bergström. Welcome.

Thank you.

Paul, the Service is an important part of Elekta's business. Can you tell us your view of our services today?

Absolutely. It's extremely good both for Elekta as well as our customers. And I mean we have seen the last year now during the pandemic of just supporting our clinicians and customers of keeping these solutions up and working during the pandemic and receiving an all-time high on customer satisfaction. So both from a customer perspective and then on Elekta, you spoke earlier about the 40%. So the last 10 years, we have had a substantial growth, and we came from roughly 25% of the total turnover, and now we're up to a little bit more than 40%.

But it's not equally distributed, is it?

No, it's -- the growth has been equally distributed across all the different geographies and markets, but we see large variations. And these variations are really coming from what kind of attach rate we have, so how many contracts we have in each market, and then really the product and the price mix. So Lionel, for example, brought up how he views Unity and the Service contract and the essential piece. We heard Larry as well talking in Americas, mentioned Service as one of the key aspects, and it is more than 50% in Americas. In EMEA and APAC, a little bit less of a share, but as I said, the growth has been there earlier, so really doubled up. So yes, we do have a large potential increasing this.

So what are the customers looking for when closing a Service contract?

It's really 3 things: I mean clinical availability. And the second one is predictability to treat. And I mean we talked a lot about the patient and the patient journey here as well. And then the last and the third one is really how do we make sure that we run the operations as efficient as possible together with the clinicians. And then, as Gustaf mentioned, we're becoming a lifetime companion, being extremely close and bringing in the customer feedback into product development.

Can you describe the revenue streams from the contracts?

Yes. So that's the good thing with -- if we just take on the contract side. So very predictable and recurrent. And if we look upon the charter that we have, a product is roughly 10, 12 years out in the market. And with the contract then having every year a revenue stream coming in, it becomes then predictive. And across the full sales, half of the revenue basically goes to the product and half of it goes to Service.

It gets very clear when it's visualized like this.

Yes.

Then how is the correlation between the Service revenue and the installed base?

So I think it's good to really have a look on the installed base because we want to grow with the installed base. And that's also why it's so important that we have the solution size that is really growing the business, and we have a growth in installed base. If we look at, from the last 10 years, we have had an installed base growth of roughly 8% in average per year, whereas we have seen the Service revenue growing with roughly 12%. But behind these figures, we have really outgrown installed base. But behind these figures, it's really exchange rate because Service is always a local business. It is about what we saw in the beginning about the Service shared depending on the different markets, and then, of course, the product and price mix.

So based on what you just said, what is your strategy going forward?

So it's -- the most important is -- which are the customer targets that we're following: clinical availability, predictability to treat and operational efficiency. So we've done it in 4 different areas: digitalization, growth, people and process, and platforms.

And how do you measure your success?

The top one, customer satisfaction. Of course, to have that as the first critical piece and the service quality thereof. Financials. So the revenue that we went through and an operational efficiency, both on our side as well as on our customer clinician side.

So the first thing you mentioned was digitalization, and you also stressed that in the beginning that we -- it was important during COVID. Can you give some more color on the digitalization?

Digitalization. Digitalization and innovation, and truly foreign. And if I take one of the examples here, how do we connect all our installed base. We have 18,000 devices connected, and it's roughly 80% of all the linacs out there. So we take all the sensors, and we then see the usage of the machines as well as we can predict the failure. So we're using AI, artificial intelligence. We're using all the big data they were bringing in, having algorithms coming in order to predict the failure, so also having patents that were filed on these algorithms. And with this, we have been able to save 200,000 patient slots per year. So if I just want to show, this is IntelliMax in a movie. [Presentation]

This really shows that we made progress in the transformation of digitalization.

Yes. I'm extremely happy that we started this digitalization already before the pandemic. And if we look upon just some statistics. On the left-hand side here, we really see this is the uptime of the solution. So we really kept it on the same level as we did before pandemic, thanks to the digitalization. On the right-hand side, we've also seen how much we've been able to do remote. So we had a huge leap from 55% to 66%.

So that is really an impressive increase. But not everything can be measured in hard figures. Can you tell us of how this meant during -- what this meant during COVID? Do you have any examples?

A few because, I mean, that's really when it becomes interesting, taking the examples. So if we then just take the digitalization of a whole logistics chain, together with IntelliMax that you just saw, we can predict failures. We can send the right spare parts before it actually fails and then plan it with the customers.,, So there is no downtime for the actual patient. If we look upon all the Elekta care support centers around the globe, we have digitalized it. So overnight, we can actually turn everybody into home workers and take it all from each homes following the sun. And if we look upon education and training, thanks to the digital platform, we always kept very, very close relation with our customers and all courses open.

So it do means that you increased one of you target that you mentioned earlier, the customer satisfaction one.

It's been, I mean, very humble, and I'm very, very pleased to see all the efforts. So we reached an all-time high on customer satisfaction this year.

So I understand the maintenance is absolutely key when it comes to providing service. But what is else in our Service offering or, more importantly, are there any changes going forward?

I think it's been an absolutely fantastic journey. Let's go to the slide, and I'll get through a little bit of the plan and my views ahead.

What do we have here?

So this is really the kind of business that you can do from a Service perspective. And if I then start here, we are doing a rather what you mentioned regarding maintenance. What we have furthers down: repair, support, and maintenance. Sort of the absolutely most essential, clinical uptime, really making sure that everybody -- everything is really working out. Going further, I would just sort of highlight the operational expenditure on a clinic is roughly 70% in radiotherapy, which means that absolutely cost and optimizing it is extremely important. So then taken and going into the next step and what can we then expand. The first one, value-added services. And I mean, for example, Maurits spoke about it earlier as well, how do we really drive workflow optimization? How can we further do with education and training, start-up services, physics-as-a-service? So there is a lot of things within the value-added services. It's also how do we leverage all the data that I spoke about earlier?

So what about the pay-per-use and the other ones?

So if we take the next 3; one, it's even more looking upon the business model as such, and I mean now during the pandemic as well. How do we make sure that we are that customer close company that are looking upon the business model that makes it easy for both of us to actually make this business happen? And then, of course, we have already started. From a software perspective, we're doing the subscription services. And then, I mean, it will be a continuation here, and it will also be managed services, outsourcing, managed equipment services, et cetera.

But of course, this variation in business model will be small in the beginning. So it will be a very gradual transition.

Absolutely. From a financial perspective, I mean, that will be gradual. For us and the customer, that will be a large focus here going forward.

So Paul, can you give us and summarize 3 messages that is important to Service going forward?

Absolutely. So we have had an absolutely tremendous journey coming here, and it's an even better journey going forward. So we will continue to grow faster than the installed base on the different geographical areas. Of course, margin is an absolutely key from a Service business. It will be supported by 3 things: digitalization that I started off with, being the forerunner and making sure that we really leverage this; the lifetime companion, making sure that we are that close, making all the customer feedback loop into the product development that we spoke about; and then really expanding our service offering.

Thank you very much, Paul, for highlighting these aspects. Now let us leave the offering and focusing on the geographic perspective instead. And we start by moving to India and meet some Indian women who have beaten their cancer with brachytherapy and got their normal life back. Watch this. [Presentation]

Access to radiation therapy is particularly challenging in emerging market where the need for building up capacity is the greatest. Consequently, it's also where we have the largest growth opportunity. And therefore, I would like to welcome Habib Nehme.

Hello. Hello, Cecilia.

Who is responsible for Middle East, Africa and emerging markets in the Asia Pacific region, except China.