Metso Oyj (METSO) Earnings Call Transcript & Summary

So here in Espoo, Finland to join our Capital Markets Day 2022. This really is the place to be today, and we're excited to see all of you joining us here in person, and also I'll welcome you who are joining online, this event. This is how we are going to run this event. We are going to have 4 presentations. We'll start momentarily with President and CEO, Pekka Vauramo. He's followed by CFO, Eeva Sipila. These presentations will be back to back and then we have a first Q&A for them both. After that, we go for a refreshing break for about 10 minutes, and then we go back and start our deep dive into our businesses. We start with Aggregates where we are discussing the business from both equipment and aftermarket side at the same time with 3 presenters. We have, after that Q&A for Aggregates team. And following a break for another 10 minutes. And then the final presentation discusses Minerals again from OE side and aftermarket at the same time, 3 presenters followed by Q&A, after which we are ready for closing remarks by President and CEO, Pekka Vauramo. And we tend to finish at about 5:00 p.m. or a bit earlier, we'll see. As we are recording this event, please make sure in this room that you have your phones in silent mode. And if you have any questions about practicalities reach out to me or even better option would be to reach out my IR and comms colleagues in the back of the room. With these words, I think we are all set. Once again, thanks for joining us for our CMD 2022. And it's my pleasure to introduce President and CEO, Pekka Vauramo.

Thank you, and a warm welcome from my side to our Capital Markets Day. Really a pleasure to have you here now live after some months and a couple of years of virtually connecting with you. So really pleased to have you here and also welcome to our audience online. I will start off this one and this one, I'll go through and review our journey more from a strategic angle to start with where we are in that journey and where we are headed. And then Eeva will continue more from a financial angle before we go into the Q&A session. But we continue to build industry leader. I'll start off with our -- what we call a strategy 1 pager. It basically describes who we are, what we do, where we go and how do we do things. The heading is our purpose statement. We feel that it's very relevant still in this environment. It talks about sustainability. It talks about the lifestyle that we live on this. On the bottom, that covers the whole part. There's our values, which we have in place in the top left corner, we have the megatrends. On the other hand, in the right corner, we have our Tier 1 priorities. Those priorities that we feel are important that will take us towards Tier 1 company that we set as our target. Target when we formed Metso Outotec just about 800 days ago, 2 years and 2 months ago. There's also our organization mentioned. It describes the way how we work. We work in a decentralized way, and we continue to work. We work and execute our business through our 5 businesses. And this has remained the same for the past 2 years. We maybe have changed one word in it, if I remember correctly, but we like to be consistent and these kind of things, they need to live over a longer period of time. But merger, 800 days ago was day 1. We announced it a year before that one, 3 years ago. Plan to merge Metso Minerals and Outotec. We feel that we've been very successful in it. We were very fast. We utilized the momentum of day 1, maybe helped with COVID restrictions. We didn't start to travel and change our plans that we had made before that one. We just executed them. And we were fast. We exceeded our targets, both in revenue side and cost side ahead of time. So we don't any more talk about integration as such. We work as one company. The combined offering that we have is showing its strength in the marketplace. It is a good platform for us to deliver further growth and value. Building a culture is always a key in the new company. We invest a lot in building a Metso Outotec culture, unique culture. I'll talk about that one a little bit later. And then if we look at the financial return from day 1, that's July 1, 2020, the TSR, total shareholder return, has exceeded 70% to date. And if we compare that one with our competitors or peers that we are normally put against, that is the highest number, by the way. And it's about double to what the average of the others are. So from that perspective, in this time frame, we have been successful so far, and we have all the reasons to be satisfied on the development so far. And we do have now the platform in place, which we want to further grow and then, of course, continue to deliver improved profitability. We focus more on products instead of projects. That will be the focus in future such products, which bring healthy aftermarket business where the sustainability has grown much in importance even in these 2 years that we've been as a Metso Outotec. It's been important for us for a long, long time, and it just continues to be the most important guidance for our further development, especially products and our offerings in general. It is a strategic priority for our customers. So it's better be the same for us as well. But we have lived all this time in very volatile environment. We all know the events that are happening still. Hopefully, COVID being mostly behind us and all the consequences, inflation just being one of them and how to live in this kind of inflationary environment. But there, again, I will give 8 points out of 10 to my team, how they have managed the business through the inflation. We've been mostly ahead of the curve in that one. And that's visible in our margin development if you look at that one. And we continue to fine-tune and adjust our portfolio. We would like to focus on things that we know that are really in the core of us into the future and do support the business models, which we feel that we can best create value with. About 2 years ago, I think it was October 2020 when we had a Capital Markets Day virtual one at that moment, I recall saying something that if we could deliver good cash flow for the next 1.5 years or 2, we would be able to pay back some of the expensive debt. And at that moment, we could turn our eyes into M&A market. And if you look at what has happened now, it's exactly like that. We had a healthy cash flow. We paid our debt back. Our net debt is reasonably low level at this moment. And we do have some firepower to right opportunities arise. We work in a decentralized way. And it means that those 5 businesses in the middle, we say that all the moneys, they are there. They need to find their home in these businesses. Right or wrong, but we practiced this for 5 years, already altogether. And I think when we look at legacy companies even longer, maybe from that perspective. But 5 years, this has been the model, how we work. We know how this one works. We know how the numbers come together. Our people know how to work, how to act, how to behave in this kind of model. And we feel that this model can still deliver many more things. Some changes have taken place on this one. If you look at the market areas, we have 8 of them. And there's one new market area that is Central Asia, which I think officially has its first day today. We used to have Russia there before and for known reasons, we don't anymore have Russia there since we are winding down everything that we have ongoing in Russia as we speak. We have also distribution management there, which is mostly and in fact, solely at this moment for our aggregates. And purpose of that one really is to performance manage our dealers and make sure that they take a balanced view on sales of both equipment and aftermarket offerings. And by the way, very good results so far. This has been in place as long as Metso Outotec has been in place, so a little over 2 years and really a great journey. Of course, combined with everything else that we've been able to successfully implement in the aggregates segment altogether. We have 3 reporting segments, as you know, Aggregates, Minerals and Metals. In this Capital Markets Day, we focus on Aggregates and Minerals. And as you know, Metals is going through a strategic review, and we are able to complete that review during the next few months. We need some more time for that one. That one was -- but we are getting very close to that one. Therefore, we don't discuss too much about Metals in our presentations. In Q&A, feel free, of course, to ask anything relating to that one. But looking just quickly what the outlook and environment in these segments are. If you remember, when we acquired -- well, when we formed Metso Outotec, we had just acquired McCloskey in Metso side slightly before that one. And we kind of said that we feel that we should grow at the same time, our exposure on Aggregates market as we grow our exposure on Minerals market. And one reason for that 1 was that we felt that Aggregates is counter-cyclic to Mineral cyclicality because there's a lot of infrastructure there that tends to be a lot of government spending, which kicks in when the economy in general turns down. And we have seen this. I mean all the stimulus packages during the COVID really boosted that business. And even though we had a few months where there were practically no new orders coming to our aggregate side in equipment side. The Aggregates business came very strongly back after 2, 3, 4 months and already in the fall -- early fall October 2020, we saw new monthly order bookings that were on record high level, and it continues to be like that for quite some time. Additionally, Aggregates business is local business or regional business. We have a couple of price graphs there. It's so local that there's very little market data as such, which is regularly published, but there is a U.S. price index, there's a price index from Japan and from India. Japan is not really that relevant market for us, but India and U.S. are. And you can see how different they are. Indian market pricing has stayed more as flat, some ups and downs, but U.S. market really strong price development, and we see and feel that in our business in Aggregates, where North American activity is currently probably highest ever that we have seen and experienced. While other markets, including Europe, we see some softness, even though even in Europe, things are maybe quite as soft as we thought still a few weeks ago. And we expect the CapEx expenditure to continue to grow at sort of low single-digit pace, which is quite normal for this business. Of course, '20 to '21, there is quite a jump, and that's the recovery from COVID, which was really rapid. Then when we move into Minerals side, that's more of a global, cycles are global. Our customers, their pricing environment, which naturally come from metal prices. It's a global. Everyone has the same pricing for their products. That's why they're called commodities rather than products. And it has different dynamics from Aggregates. Yet Aggregates and Minerals are very synergistic internally for us from many aspects. There's a product side production synergies as well R&D synergies and the aftermarket synergies that we have between these 2 segments. Therefore, we feel that these 2 belong close together. But in the mining side, if we look at the -- currently, the most important metals for us copper, gold, iron ore. With iron ore, the only exception where the outlook from the price viewpoint is flat. And then the focus is shifting more towards, pelletizing more towards steel production itself and more towards decarbonizing the steel production. That's where the next huge investments are going to take place. And that could be very potential for our Metals segment, that part of it. But we are not expecting huge investments into new mine production even though there are process improvements that need to be done, we all know, for example, the tailings handling and management in iron ore mines in some areas needs really urgently to be addressed, and that is that's really opportunity for our Minerals business. Out of these metals, copper, the demand and supply situation is tight and is also forecasted to continue tight and that is very supportive for the price levels. And despite of lack of new greenfields, our customers will be in position to invest in debottlenecking in existing operations, debottleneck, expand the productions. And this is what we are currently seeing. We, of course, hope for that and wish so much that the greenfields could come, stream online because world needs the copper. We need to electrify everything and everything that's electric requires copper. We need it in a grid, we also use it for our cars, we need also more copper, but it's everything that electric requires copper. Very few substitutes, maybe aluminum in the grid side, but that's about it for copper. These are the biggest volume metals. But interesting part are these battery, so-called battery metals and the new kid on the block is nickel here, which was raw material for stainless steel, but it's now turning into a battery metal and is very interesting at this moment. Currently, it's the electric vehicles that's driving this demand. And there's so many studies made out of this one, but I think most of them saw that there won't be enough of these metals. Even though geologically and the mineralogy that exists only earth there's plenty of these metals. But how to exploit and excavate them in an economical way is the key. We believe that pricing will also or the demand will support pricing of these products, and we will see continued investments into these metals. So longer-term outlook for both segments, we believe, is favorable. We see, of course, humps and bumps on the road going forward. This business is no way isolated from a macro and from the economical developments in the world. But maybe we see some smoothening of the bottoms with the megatrends that we have around us. Then moving to implementation of our strategy, and I'll just use this Tier 1 priorities what we have as a sort of -- and comment then. So we made a self-assessment on where we are in the journey. And this journey is not how well -- it's not about how well we've succeeded so far. But let's say, how far we've come to what we feel, where we could be and where we want to be at the end of the day. And I'll start from sustainability because I feel that, that's where we have really taken major steps forward. We have introduced many things Planet Positive. We were the first ones amongst our peers and competitors to introduce science-based targets. I think still we are the only one. I know that the others are also in process. We are starting our third year with them. and we are reporting this progress to the markets on a quarterly basis. And this is very well noticed by many of our stakeholders as we move on. We are launching new products, Planet Positive products. Products and some interesting concepts are really arising from that area. We've been on the list of Global 100 most sustainable companies for several years, highest position was a couple of years ago, we were #8 on that list currently or the latest 1 that I saw, we were on position 42, if I recall correctly. We didn't drop because of us. I think there seems to be a rush on that list and many, for example, financial institutions made inroads, so your companies took to our position kind of -- but that just shows that -- how interesting it and how important it is to get listed -- on these listings and how much effort there is ongoing in -- probably every business to get on it. Our cultural development, I would say that we started slow there. We had COVID, we couldn't travel. We didn't meet. We were just implementing our integration plan, which was good from the synergies delivery viewpoint. But now that traveling is possible, we are seeing really great steps forward. We are measuring this, by the way, very frequently that where are we with our culture journey. We measure it quarterly with a tool, which is very agile tool, tool which is close to the tool in this week, I think it was closed on Monday and Tuesday morning. I had results on my cell phone on that one. So very agile tool, one of the best tools that I've ever seen. And it's a very expensive tool that we have. 85% of our employees respond to that one. Biggest reason for 15% not doing is that they really don't have the tools or access to company network for reason whatsoever ever, but high attendance rate. And we measure it because we want to take action in areas where we need to take action. We're making good inroads. We've improved our [ engage ] score every time, quarter after quarter, and we'll continue to do so. The area where we have most to gain is customer success. And we feel that it's -- we only succeed if our customers succeed. If we succeed, but our customers don't, I think it's just a coincidence and it's not on sustainable basis. So that's the ambition that we want to deliver. I'll come a little bit back to that one. But we clearly, with all the challenges in supply chain, for example, I mean, that's an area that we need to improve. And then last but not least, financial performance. With very round figures, we started close to 10% EBITDA levels. We are roughly at the 13% as we go, and we are headed towards 15%. So I think that translates to 60% achievement so far. So there's some automatics. The others are more sort of self-assessed based on our own judgment. Our financial targets there as well, I would say that we've delivered 3 of them, 3 of them, we still have distance to go with our margin, but with the actions in place and with the growth that we have, with the outlook that we have, we do have the potential, and this team over there is very much committed to delivering that result. We haven't changed this, by the way. We moved up a little bit in the investment grading. We are one notch better now of than when we started, and that is because of our stronger and strengthening balance sheet since the merger. Customer success there on the left-hand side, really the important criteria, so basic criteria to how customers look at us, look at us how responsive we are, can we deliver what our quality is. And with the supply chain challenges that we have had, have areas that we need to be prepared to invest in that area as well. We've seen how fragile the supply chains can be and how difficult availability of some of the components and how difficult it would be to continue to base supply chains on globalization as we have learned to think about the globalization over the past 15, 20 years. So that development needs to be somewhat diverted or back tracked. The way how we address these ones is through partnerships, through digitalization and providing customers products that help them to achieve better results. When talking about sustainability, we also need to look at our own operations, and we do target delivering net zero footprint by 2030 and cutting the CO2 emissions by 50% at the end of 2024. We are already, by the way, below that one, but it's a very tough measurement that because it's an absolute measurement. And it's regardless of what level our production is. And if our production is on a higher level, then of course, the CO2 output emissions are most likely to be on a higher level, but we've committed to reduce regardless of that one, our CO2 by 50%. We are well in target achieving that one. On logistics, we have already made quite inroads. It ties back to our warehouse network, our supply principles, how the materials move. And we will also make some supply chain investments in order to cut the logistics part. But it will also bring some other opportunities for us if we do so. And we are driving our suppliers to commit to science-based targets. We started from way below 10% of our expenditure or suppliers behind our supplies below 10% having the science-based targets. Currently, we are somewhere between 13% and 15% on our journey. We also report these ones on a quarterly basis. And by 2025, our goal is to get to 30% of our expenditure on that level. By far, the biggest impact we can have with our customers. And this is the handprint story that we have been saying. If we just measure the handprint , we are already net positive. I mean what we -- the impact that our processes and equipment have when our customers operate them, their reduction of CO2 is way higher than what we produced in our own operations. We've launched the Planet Positive, that's just to make it easier for customers and also our stakeholders easier to track down our development in terms of sales. And we do report that number on a quarterly basis. It's always a rolling 12-month number. Number prior to reporting on the latest number was just over EUR 700 million. I think we started this from about EUR 500-something million level. I think less than a year ago, we published the first Planet Positive sales. Our aim is to grow this one at double the rate that we grow the overall sales number. We created this system really to make it easier to track our development because this area is really lacking standards. So we decided to create our own. But we do have external party that make sure that we stay honest and we stick to the criteria that we have set for that one. And sustainability is naturally integrated in our businesses, in all areas. And if I needed to the big one out of this one at this moment. I mean, in our consumables business with our upcoming footprint actions, we will enter a recycling of used consumables. And to give you an idea, what it means from sort of raw material viewpoint of our consumables customers cannot use the remaining 40% to 50% of the parts, and they are reusable. In metallic mill lines, they are casted items of alloys, certain alloy metal, and we can use that same metal, put it back in the furnace and produce new ones out of that one. But that requires that we are close enough to our main customers and have the capability to produce the new. We now -- our R&D currently in the testing phase, we are doing the same for rubber mill liners. And this is something very unique in the marketplace. We will hear about that one during the months and maybe next year. More about how successful we are in that one, but it looks promising, that one. Currently, there's no way of recycling those rubberware aligners and that same 40% to 50% basically returns. And if we can use that one, it's naturally Planet Positive from our viewpoint. Digitalization does have the further potential to go. We have demonstrated that we can digitalize things. What we haven't been able to demonstrate that we can change business models. And our ambition is to change business models. For example, with our digital twin, the Geminex that will be described later today what that is and does. But it's a tool where customers can optimize, maximize their recovery rates, and we need to come up with a business model where we are sharing that benefit rather than just selling this product as any other product. So more of a service model than products. Culture, which we feel is very, very important. In my view, when we compete, it's the company cultures that compete. And strong culture, we all know that strong culture, if it supports company targets goals and ambitions, it is really the powerful tool that basically addresses any concerns that one might have in business before they become issues and problems. And that's where we want to aim at. This needs to be integrated in businesses. Business' role is to come up with agenda that's inspiring to people. That's how we can recruit and retain people. We need to have the right leadership in place so that people can see that they have morals in the company to follow, and they are given the opportunities to develop themself. And we measure this, like I said, on a quarterly basis, and we are improving. We are in top quartile of our industrial -- international benchmark in this area. We aim the top 10% position. And when we are there, then we know that we have the right things in place. Meanwhile, we continue to invest in that area. I mentioned about that it's for us time to turn our eyes into markets and look at acquisition targets. And of course, many of you know and we've said that there's nothing really big and huge. But there's plenty of small ones, bolt-ons can be adjacencies as well close adjacencies to us. But we prioritize certain things, products with higher aftermarket. That's a clear guidance and commitment from our outside. Sustainable offering, automation, digitalization. Those are the areas sort of in from the offering viewpoint. But new sort of a rising issue is really competitiveness of supply chain, and we will see investments going into that area. That supports also our sustainability ambitions, as I described in the recycling of consumables. With these ones, would like to conclude my part just to summarize that where we are. We do have a leading position in what we do in technology and in sustainability. There's no question about that position. We do have a strong platform to grow and create more value, and we are committed on delivering that one. We committed also to continue to change our business model to make it less volatile. And this means less impact from the project, more products, more standardization, standardization in a way that we still can fulfill the customer needs and the market needs in those areas where we decide to do so. And we do continuously self-help. And this is something that we carry from our integration and the synergy work that we did. We did install a process into this company, way of working, systematics where we -- from idea through certain gate approach, develop the ideas to action plans, follow the implementation of the actions and follow the financial results. We use the same process now to do self-improvement on annual basis. Our sort of internal ambition, it's not a project that we would announce. But our internal ambition is to work roughly on a number which equals our salary inflation. Might be challenging for next year because numbers will be high. But let's say, with the more traditional inflation numbers. But that's what we did in this year, by the way. We'll do something similar next year. And once we repeat it for the third year, it becomes a part of culture. With these words, I think it's right time to leave the floor for Eeva to go through the financial. Eeva, please.

Good afternoon, ladies and gentlemen. Welcome to everybody in the room, and welcome to people by their computers. I'll be touching several topics today, complementing what our President and CEO just presented, but really sort of adding maybe from a financial angle, a few comments, so you can round -- near round up your analysis on the Metso Outotec. And I'd like to start with this graph illustrating in, I think, in a very simple but clear way Metso Outotec journey. And as you well know, we've had a journey during sort of somewhat unique and challenging times. Starting in the middle of COVID and then with various sort of external sort of mostly unwanted shocks around us. But nevertheless, I think we sort of -- we were able to start seeing growth in our orders after a few quarters seeing the customer confidence coming back and getting the sort of sense that our offering as a combined entity is something that does deliver value to our customers. Now in our business, it typically takes a few more quarters for orders to really become visible in sales. And as this time period has been one where I think we've really sort of been challenged throughout by supply chain issues. Then obviously, if anything, as sort of the sales growth has been a bit slower to come through from the sort of order booking. And hence, we've actually sort of delivered a lot of improvement on our profitability without much volume leverage only in the past couple of quarters, you start to see that impact. Now these are rolling 12-month figures for a reason. You're very well familiar with the quarterly numbers, but this takes away a bit of the noise. And hence, sort of as a way of looking back, I think, is quite good. And in our previous Capital Markets Day 2020, we were talking about a starting point at just ahead of 11% adjusted EBITDA margin and we're now at around 13%. And we'll be talking later in my presentation, especially in the segment presentations on how we get from 13% to above 15%. What's also important is that we've seen growth and profitability improvement in all our segments. And I think so it's kind of a very balanced approach in the sense that we've really been able to sort of fire on all cylinders from what we have. But before I go to more details in -- I'd like to actually draw your attention to this slide. You heard our President and CEO talk a lot about sustainability, how it is very much at the core of our strategy. And obviously, then everything we do in finance needs to be in line with that. And we launched the sustainability-linked finance framework earlier this year, and that really is a platform that I think will grow. And we will obviously come up with new ways on how to measure, how to sort of tie more and more the financials and the operational strategies together. But very exciting to be part of this trend and really help develop that in the industry. Then if I move on to our balance sheet. We have a strong balance sheet. We think we have the means to grow both organically as well as unorganically. You see that EUR 300 million bonds, obviously, are the basis for our funding. Together with some smaller bank loans, they account for more than 60% of our debt. We have invested in liquidity arrangements. It is a very volatile world, as we know, and hence, the EUR 1.2 billion is a big number, but we've sort of felt that we really want to ensure that we can run our operations and go for the opportunities that our business finds in all circumstances. Maintaining an investment-grade rating is 1 of our 4 financial targets. And during the 2-year journey, we made good success in improving on the credit metrics that are important in the definition of what the rating is. And I think we're now in a sort of comfortable position to really, as I said, support the business and deliver also on the opportunities that may arise. On the tax side, important element for shareholder value creation, this is well. Creating a centralized tax model has been a key focus for us. This very much builds on what we built in Metso a few years back and now sort of leveraging the full potential of the merged company in this area. And as you see from our effective tax rate development, I think we have delivered clear value in this area. In today's world, tax is also very much about sustainability. And we have already, today, quite a bit of voluntary information in this area for various stakeholders. And as we move forward, I do expect that there will be even further sort of requirements. And we're very committed to providing that information as well on our operations. And the graph on the right-hand side depicts our last year sort of the taxes paid. So the cash view on taxes for you. Then a couple of topical items this year. Our President and CEO already touched Russia. And obviously, that wind down is something that's consumed a lot of time from us. We haven't taken any business since the start of the war. So it's really been in a sort of wind-down mode now for quite some time. Now we have the benefit of not having real assets in Russia. But at the same time, we have project liabilities sold into Russia from various countries outside, and those are rather complex from a legal point of view. To wind down, we basically need to negotiate and terminate them all, one by one. And this is something that has, as said, taken time. Fortunately, I think we've been sort of slowly been able to move to a phase where this takes much less of our business time and much more the time of our legal department and our finance department. And that, of course, is how it should be. But we do expect now towards the end of the year to be in a position where we have winded down the business. And obviously, all there is very limited staff anymore, and we'll remain with a small accounting team going forward. Now another topical item for this year is cash. And this is not an apples-to-apples comparison, so pay attention. The left-hand side is around last year, full year numbers. And then the right-hand side is the first half of '22. But nevertheless, I thought this is actually hopefully an illustrative way to describe to you how sort of what's the sort of main elements that have been moving if one starts from the net profit and then works to see sort of where the cash sort of goes. And now in the first half numbers, the 150 million wind down costs that we wrote down is sort of is obviously impacts the net profit. But then again, it's back in the change in other liabilities as that mainly will not be a cash cost outside of obviously the restructuring of the organization and these type of things. But if we think of where we were sort of end of June, it's added back in that column. But apart from that, I think it's very easy to see the sort of supply chain challenge that we have been living with partly, of course, the inventory growth is very much one off growth. As you saw from my first slide, we're starting to really sort of see real growth coming through and obviously affects the whole area from work in progress to goods in delivery to customers. But then there's also an inflation element. There is a price element that, in some cases, is bigger than the volume impact. We're actually very pleased on how we've been able to manage the AR and AP side in this environment. Obviously, kind of -- when we know the challenges that are not easy fixes in the supply chain, we need to also make conscious decisions to invest in inventory in order to ensure availability for our customers. So then we need to be extra efficient on what comes to all the other elements. And in AR and AP, obviously, a function of our customers doing well, typically makes the AR side better. But if you think of the sort of sales growth we've seen, for instance, in the beginning of this year, then that cash flow number is actually a very good number. And we have improved actually in sort of days and efficiency. But I think as we sort of continue in this year, the supply chain challenges do continue, I think they're hopefully not getting worse. We are seeing some relief, but it is obviously a real issue that will not sort of improve overnight as well. And obviously, as our business continues to grow, this will be something which we'll sort of will have to take into account from a financing point of view. Hopefully delivering improved margins and sort of more than compensate for this investment. When it comes to our portfolio, maybe a few topics to touch here. Discontinued operations is not necessarily a very material item but has created some impact into our earnings per share. So just to help you out on that one. So the recycling business, the second half was sold now in June during the second quarter. We originally tried to sell it in 1 piece, would have obviously been a faster way to do it, but ended up splitting it and selling it into -- for better shareholder value. Now the waste-to-energy business is even smaller business. This has actually been on sale since Outotec time, so already quite a lengthy process, not the easiest business is to sell and hence has really taken a bit longer than expected. And we are sort of now again in sort of discussions which we want to sort of take forward and see that hopefully getting the solution that would enable them an exit. Certainly there is a business opportunity in this business for somebody who's there as a focus area. However, good to note that the old legacy projects are something that we'll need to manage in the Metso Outotec context to close them. Then on Metals, we really had quite an extensive amount of work put in this area throughout this year. It is already a much more sizable business, much more sizable carve-out to consider than anything we have had under discontinued operations. And because it really is a portfolio of technology, it does require also some sort of specific attention on thinking about where the value is and the potential. And as our CEO mentioned, we're sort of well into it, but a few months of work is likely still in our hands. I think for this audience, it's good to note that nevertheless, with the sort of big chunk of the work done, I think the sort of conclusions, so far, are very much in line with our earlier assumptions. If anything, we have been positively surprised by how current some of the technologies in the portfolio are and green steel hydrogen areas are examples where even during this year, a lot is happening. And hence, there is those technologies definitely are something valuable in the right hands. Of course, not mature technologies and hence, will require investment to really sort of get to where their potential is. Then again, from a financial point of view, we delivered on the turnaround. I think we're in a good position from a Metso Outotec point of view that it's not such a drag as it was in the early days of post the merger and contributing, in that sense, its share to the overall, which obviously, gives us sort of more options as well from a future point of view. Then again, the business profile has and remains different to Metso Outotec core, too much of what we will be discussing today. Limited aftermarket opportunity and obviously a very project-driven business, not so much products and modularity as we have in the rest of the businesses. But as I said, we'll be coming back to this topic then more in detail later on. Then I think it's time for me to kind of summarize from a group point of view, the main topics around the 15% margin. As I said, we've delivered on all 4 financial targets during the first 2 years. But I think for this audience, specifically, the 15% margin road map is obviously important. And we'll be breaking the journey down in the 2 segments. Some of the measures are slightly different. But then again, there's a lot of commonality. And if I kind of summarize here on the right, the topics really from a group point of view to help you then pull it together. So aftermarket growth, we will be discussing quite a bit of that. There is real potential on that when we look at sort of what we have experienced in the past as Metso, what we see from peers, what we see from the market environment. And specifically, we have good examples of how we can do a better job in increasing the services captivity. There is real value to be made, both for the customer and for Metso Outotec in this area. Consumables has been something that actually has sort of going in the wrong direction in the past 12 months in difference to our other businesses for the obvious reasons of that business being directly impacted by the raw material inflation and as well as the energy costs. We're happy that we have turned the corner. We have all the time felt that it is more a timing issue, that we need to just have the agility and speed to act on those changes, which clearly, in a way, have been so high that it has been difficult to predict. Ideally, of course, one would be a bit to step ahead, but because of some of the external volatility, we've been a bit sort of catching up. But we have a value offering for our customers and our customers are doing well. So it is more a timing issue. And as turning the corner will obviously contribute to the overall group. What's maybe a bit of a new topic on the list is this aftermarket supply chain and procurement and not necessarily doesn't sound like rocket science, but certainly in today's context. And with what we know now versus 2 years ago, this is something that we've sort of raised much higher on the agenda and have much more sort of detailed concrete work now on our road map of actions to really deliver on this front today, potential is there. And then fifth, this will not be a new topic for most of you listening. We talked about productization for quite some time, several years. We have very nice progress to show later on today as well on the success of making this happen. And of course, that makes it even easier to sort of continue on that journey in the businesses where we still the potential, very much around sort of efficiency around sort of just better control on the margins from an execution point of view, also from a sort of risk reduction point of view as we move forward. So those 5 are really sort of areas where we have concrete actions. We work with this business improvement concept for quite some time. Well, prior to the merger, then in the early days of merger, these were very much parallel to the synergy hunt. And now again, when the synergy period is behind us. So this is kind of then gets the full attention in the company. And then, of course, there is an element of being -- of commercial excellence on top of this all in a way then to protect margins that you're able to gain by being more efficient and smarter in how you approach. And then from a group point of view, just an obvious note, perhaps, but all the portfolio decisions when it comes to acquisitions or divestments, obviously made in line with these financial targets. Financial targets in a way for us are given we intend to achieve them. And everything else we do needs to contribute to these targets. So with that, ladies and gentlemen, I'd like to conclude with the key investment highlights. At Metso Outotec, we are leading -- we have a leading offering in both Aggregates and Minerals. We are a leader in sustainability and technology, which I believe makes us more future proof. We have a strong aftermarket presence and a lot of capability in this company so that as we sort of continue to focus on growing this business, we really have a good base to build on, but ample opportunity to go even further. And then finally, we believe in our financial targets, we believe in our margin targets and are very committed to delivering on that, on the 15%. And as I said, you'll hear more detail in the next 2 presentations really then to hopefully give you the same confidence that we have internally. And with that, thank you on my behalf. I think we're ready for the Q&A.

Thank you, Eeva, Pekka. Let's start our first Q&A after these 2 presentations. As a reminder, let's try and keep the questions at this point at group level because we are going to deep dive into our businesses after a while. And we're also taking questions from the webcast through the chat function. And in this room, if you have a question in mind, please raise your hand. We have 2 microphones and wait for a microphone to arrive and then state your question so that everybody hears that also online. Just to warn you up, I'll take the first question from the webcast actually, and this is by Klas Bergelind. He asks Pekka specifically to you that Klas says, based on public information, you will be in this role for another 15 months or so. You started decentralization already at Metso when you came to the company. You continue to talk about productization, standardization, especially equipment offering after the merger. Then during these 800 days since the merger, we've had, hopefully, temporary headwinds in terms of COVID, inflation, war, et cetera. So the question is from Klas that which are the areas you think you are lagging in terms of margin progression towards targets?

Yes. Thanks for a good question, Klas. How would I say that I've been, during my career, part of a journey where I have seen the margin moving from high single digit to first low double digit and then strong double digit, and since that time, we've seen those margins to go even higher up and starting with 2. I know that it was a long journey there as well. And it doesn't happen in a few quarters. It's a long march. We've embarked that march. And the key things of that march were summarized on Eeva's slide, I believe, in this product business that brings healthy aftermarket. Products are things that are created well ahead of the sales compared with the projects. A lot of project delivery is created within the project. Enormous amount of engineering goes into these projects. A big part of that is not reusable. So that model is not scalable to the way we want that to be. And therefore, the product and aftermarket journey is important. The scalability means also that the aftermarket will be created while developing the product. I've said this many, many times that this is a journey. The journey doesn't end, but it produces margins step by step towards where we need to be.

All right. Thank you. Joel?

It's Joel Spungin from Berenberg. I was wondering if you just ask, if you were to compare your thoughts about the growth potential of your end markets, I guess, principally Minerals, but also Aggregates, you're thinking now compared to the last CMD 2 years ago. Are you more confident about the growth outlook? Do you think the market will grow at a higher rate now than you did 2 years ago? Or are your views unchanged?

Yes. That's really the visibility with the macro -- the way it is, is somewhat foggy into the near future. But I'm more confident that the long-term demand for Metals does exist there. I think we all need to think about our priorities in life in case we want to save this planet. That's why we have the planet positive. And I haven't seen any other solutions than electrify things, and that requires more metals as said so many times. And that gives the growth potential for us and then it's up to us and our team -- entire team to deliver the offering that is the most relevant, most sustainable, most efficient and profitable for our customers -- to our customers succeed because we believe that we succeed as well if our customers do.

And would you say that's also true on the Aggregates side?

Well, it is different dynamics there as well. But if we look at all the megatrends that are out there, it's very supportive for our Aggregates business as well. And if we look at the past, which never is a guarantee of the future, as we have learned of that one. But the growth, in fact, has been quite steady of the markets in that area. And the way how we have executed our Aggregates, I think we have taken more than our share of the growth over the past few years, both organically and inorganically. And we've been very successful in bringing McCloskey and some of the smaller acquisitions into that part of the business. And I see continuation of that one. Maybe some smaller steps sort of inorganically, but organically, definitely.

Maybe we could -- sorry, maybe we could take the other mic to this side of the room as well because it seems that the questions are tilted to the left from us. But Erkki, go ahead.

It's Erkki, Inderes Oyj. Regarding the overall demand or metal demand, do you see that the demand for battery metals will be strong enough to compensate for the impact of the obvious deceleration of the Chinese economy and the recession that western world is facing, i.e. will global demand growth for copper, lithium, nickel, et cetera, still be in the mid- to high single digits going forward in '23, especially?

Yes. It's quite difficult clearly to say that how these balance sheets will work. Chinese demand currently is going definitely a sort of short-term or medium-term decline at this moment. But at one point, I'm confident that, that will turn into growth as well, and it will change the picture again. We had the graph of EVs, electric vehicles. I mean, was it in 3 years' time, there's going to be double the amount of -- double the annual volume of those vehicles coming on to the roads. And that's only one area of electrification. There's so many other areas that we need to work on this. Energy transitioning -- transition that is happening in probably more forcefully now in Europe, it means that we need to invest in many things, not only in solar and wind and -- maybe nuclear as well. But the grid and everything, the power storage is when they do kick in. I think we are going through such a change that nobody really has thought of magnitude of these changes what they are. I don't have an answer to that one, but I do believe in direction. Yes.

Antti.

Yes. You mentioned the supply chain competitiveness in 2 different sections, acquisitions and also the building blocks on profitability. So could you expand a little bit about what concrete actions would that mean? Is this geographical footprint? Is this more in-housing? Outsourcing? So please, a little bit more clarity on that one.

Yes, it's a good question. There is an element of in-sourcing, outsourcing. We have sort of seen with some of the lead times and some of the capacity restraints that actually there would be some value in in-sourcing certain sort of competencies. But I think the bigger chunk is still sort of on how we develop the partner network around us. Now we've seen clearly with the challenges on global logistics, for instance, that we have to have a more agile model where the sort of the previous model was more driving efficiency from one location globally. And now we clearly see the sort of the limits of that and kind of need to balance that with a more regional approach in certain areas because for our customers, availability is key. And it is something that they're also willing to pay for, but we need to be able to offer that. Then, of course, it comes to sort of our practices of how we work, how integrated we're able to work and share views on demand and a way on how to really sort of mitigate all the sort of unnecessarily sort of lead times in the chain. When the lead times are long already, then there's a lot of work in the back office side that needs to be more streamlined. And then, of course, there's that element that we -- as we want to sort of ensure a sustainable supply chain as well, it will require certain sort of changes to who we work with and how we work as well. So hopefully, that.

Yes. Maybe a follow-up on the supply chain. I mean it's been an obvious profitability headwind in the past year or 2. But has it been a head or tailwind regarding your market shares? I mean how have you -- how has the competition handled kind of the long delivery times, freight cost? Has that perhaps sheltered you from competition in some product areas? Or has it been a challenge?

Well, it's been both. I think certainly for all global players, the global challenges have been exactly the same. And I think our footprint with the coverage we have has actually been delivering clearly better. And we have won some business just on the reliability angle and kind of the trust that we can and we will deliver. Then again, there's areas where we have very local competition who don't have the logistical issues, then obviously, we face situations where they actually are -- have been able to be more nimble and agile. So I'd say there's examples of both. Generally, I think our footprint has now been sort of tested with the COVID shock and now with the war. So I think we're sort of considering all that. We weathered it pretty well. And clearly, that sort of balance of having many regional hubs has been a clear winning formula. Also the fact that we have strong enough organizations in all parts of the globe. Clearly, this is a -- this has been an absolute must when decisions have to be made very quickly. But to that point, then we also need to sort of make certain sort of new decisions with what we know today around that sort of regional view.

Tom?

This is Tom Skogman from Carnegie. I have 2 questions. I'll start with the first one, and they are both about savings that you mentioned in the previous Capital Market Day. So you talked about this business-specific savings that should be around EUR 70 million, if I remember right from the chart you showed there. And I'd like to get some kind of an update where we are with this because, I mean, a big part of those should be in the Aggregates business that has enjoyed strong volume benefits as well. So it's a bit hard from the outside to know whether these have kind of all come through or they -- whether there should still be some coming?

Yes. Well, I think you've certainly sort of seen the merits of -- in Aggregates, where I think one part was the McCloskey synergies and that integration and the other part was the overall productization and efficiency focus. I think there, we're very happy with the success the Aggregates team will come back to that. On the -- then again on the consumable side, the sort of outcome of the footprint exercises, we were -- we have done so far have been partly eaten up by the sort of raw material challenge or sort of slowness to react with pricing in that sense, sort of keep the margin benefit from those actions. And now as I said, as we kind of have turned that corner, I think that will look a bit better. But right now, you could say that, that hasn't fully -- on a net basis hasn't delivered on those targets. Then again, on this productization, modulization again, sort of very, very nice achievements in the Minerals side as well. So the -- I don't think we gave an exact number at that point, but I'd say that we're sort of -- 80% sort of success in that. And again, we've had a bit more headwind than we perhaps were wise enough to see in advance and that sort of fighting that means that we're now at 13%, and we still need to do some work to get to 15% rather than being at 15%.

I mean, analysts love to do EBITA bridges and so on. And you have these synergy savings of EUR 140 million and they should all be almost in the Minerals division to my understanding as there are no synergies in Aggregates or Metals. But the earnings growth has been kind of almost smaller in that division than in the other divisions despite these synergies. So can you help us to understand and also kind of convince us that, that savings have not just been lost to customer prices. I mean, you say that it's only temporary now in consumables, but perhaps you should get the number also on how much better should the consumables EBITA be on a 12-month rolling basis if this would not have happened with inflation.

Should we come back to the after the Minerals presentation on that?

But you're right. I mean if you look at the -- for example, our aftermarket, which is predominantly the Minerals side, behaved during the COVID. I mean, it took us by surprise how long lasting really the downturn when it finally reached our Minerals was specifically in the aftermarket side and then the inflationary pressure that we did mostly experience, by the way, in our consumables from 3 main items: energy, freight charges and raw materials. They all hit our consumables and then with the hundreds of contracts that we needed to renegotiate with the time delay. Yes, we do have a price tag on the consumables, on an annual level very roughly. It is pretty close to EUR 40 million what we had the headwind. And like Eeva said, we are -- we have turned the corner. That's what we feel at this moment, but a couple of more months will tell us if that is the case.

But you don't feel like you have lost savings in other kind of part to customer prices because we don't really see this EUR 140 million. If you take EUR 40 million away, that's still EUR 100 million and you have a good volume growth now as well there, so.

Yes. Like I said, I mean, it's -- I gave 8 points out of 10. So 4 of our businesses have been able to respond either through cost actions or through pricing to the inflationary pressures. Some of them have been ahead of the inflation curve, some in par with it, but we've had issues with our consumables.

And then finally, just an update on what you see? Do you see any bad signs in demand from the falling metal prices in the customer?

In fact, falling metal prices, yes, they have fallen. If you take a very short-term view, you take a view from, let's say, 4 months or 6 months few years, it's a falling view, but we are still on a very high level. If you remember the graphs that I showed on copper, we are on high level. On gold, we are on a very high level, still not on a peak level, but we are on a very high level. Iron ore is the only lagger at this moment where we are. We saw extreme peak right after Russia invaded Ukraine. Nickel price has continued to be on elevated level even after Russia's invasion to Ukraine. It came down a little bit, but it has stayed on a higher level for obvious reasons, a lot of supplies coming from Russia to the nickel market. And that is where the picture is and that is still a healthy environment for our customers to continue to invest.

Tomi Railo.

Tomi Railo from DNB. Also a question on the services and equipment margin. So if you could comment your group margin has expanded you mentioned, and we have seen it to expand in all businesses. But if you would exclude the impact of consumables, since the merger, how has the progress been in the services profitability compared to equipment profitability where has the biggest change come from? And also, is it more -- has it been more tilted to Minerals or Aggregates in terms of service profitability?

I think we've seen a bigger improvement on the equipment side than in the aftermarket side, even excluding consumables like you asked. And very much really thanks to that sort of modularization and that product approach in a way, and partly, of course, in Minerals, the synergies as well on putting the 2 offerings together. Then, of course, the equipment side has had a bit more of sort of volume tailwind as well. So of course, it's partly perhaps a bit unfair question, but on this 2-year momentum. And hence, the sort of the opportunity, I would say, still is in both, in a way. There is room for equipment business, but there's certainly room for the service business on this -- on these value-add services to improve and -- which we kind of like in a way that then it's not a sort of one thing that we're focused on. We're driving several initiatives and that, obviously, sort of lowers the -- sort of improves the success probability on driving it through.

Follow-up. So divisionally, Aggregates or Minerals has still, in a way, potential. And maybe just to check, so the profitability in services is better now than it was in 2019...

Yes, yes, but on a -- has improved less than equipment.

I think Panu there in the back.

It's Panu Laitinmaki from Danske Bank. I just wanted to ask on metals and the review. So did I understand correctly that you have not made a decision whether you want to keep it or not and -- or if you would keep part of that? And then when do you expect to conclude the review and if it leads to a transaction, when do you expect that might happen? And then finally, have you already seen interest from potential buyers on that asset?

Yes, we will need a few more months and reason for that one, we want to prepare ourselves well for that one because the day we take the decision, we have -- according to IFRS, we have 12 months' time to divest it, and we don't want to make that prematurely before we are ready for that decision. It's going to take a couple of more months, maybe 3, 4 months -- additional months, but then we are ready to conclude that one. And yes, we have done already some preparation. We've [indiscernible] out. There are some indications already existing out there, but too early to say anything. And obviously, it's a process that we will then run and then tell when we're ready about that one.

We have a couple of more minutes, and I'll take a few from the chat from the webcast. First is from Nick Housden, who says that target is obviously 15% EBITA margin over the cycle like we have heard. How do you think about the peaks and troughs? So in terms of kind of range, how that kind of margin would behave around at 15%? Any thoughts on that?

Yes, absolutely. I mean, we cannot -- we are not happy if we only deliver the 15% at the peak of a cycle, but I don't think we've done enough sort of number crunching to come up with a range. Maybe that is something we would address sometime in future, but we are aiming clearly. And obviously, portfolio is part of this one, and we are aiming clearly to be in position that in the peak of a cycle, we deliver above that one. And then depending on how flexible we can be, how scalable, how our business model will be that more or less then tells that what we will be at the bottom of the cycle. But we've learned many things in this integration. I said about the process that we have installed in place. We will use that one always when we have sort of improvement actions in place. We don't hesitate to take those decisions. I go back to COVID savings, which we initiated when the travel restrictions -- when it was evident that this is a global pandemic, this was in March-April 2020. At that time, in Metals side, we had in 2 weeks' time in place 80% of the saving actions. And if you recall, our second quarter 2020 results, we turned out a quite nice surprise there. So that's an example that we take fast decisions if need be, and we know what to do.

And one more question that needs to be asked in this Q&A from [ Matteo Di Tomassi ] update on the smelter project in Saudi Arabia.

Yes, we are in final phases of ramping up the production. It's somewhere in the 70% level in the furnace 1. Over there, we have still some work that needs to be done some COVID delays in that one. We are working within the provision that we made out there, and there's no really further news of that one. But of course, we hope to conclude and close that part as soon as the timing is right. We still need some more time to complete that part.

All right. Thank you. This concludes the first part of this event. I have plenty of questions here and don't worry, they will be asked when it is time to discuss Minerals and Consumables, specifically and so forth. So I'll take them up then. We have approximately 8 minutes before Aggregates presentation starts. So please refresh, take coffee, and we'll be back half past. [Break]

All right. Welcome back from the break. And as I said, now we are starting our deep dive into our businesses. We start with a presentation about Aggregates. And we have 3 presenters talking the Aggregates from both equipment side and the aftermarket side. So please welcome Head of our Aggregates Equipment business, Markku Simula; Head of Services, Sami Takaluoma; and Head of Consumables, Heikki Metsala.

Hello. Good afternoon.

Good afternoon.

Good afternoon from my behalf as well.

So welcome to the Aggregates business segment presentation. We'll talk about value for diverse customer base or diverse customers, and we have plenty of customers in our industry. We have thousands of customers that we are serving. So -- but first, we'll dive a little bit into the history and our position in the market. So the graph on the left describes our growth over the last few years. Our growth has been actually 14% since -- 14% CAGR since 2016 and also about 14% since beginning of that time since 2019. So Aggregates segment business has been growing consistently already for quite many years. It's been organic growth and it's been acquisition growth, both in there. And like you can see that we have been growing faster than our main competitors have been growing. Then on the right side, you can see our kind of comparable size. In the graph or in the bars with the red, you can see the Aggregates business size, Aggregates segment, so including crushing, screening businesses, capital as well as aftermarket. And our number being from '21 about EUR 1.2 billion, which is more than the next 3 combined -- globally combined. So we are -- truly in our Aggregates business, we are by far the #1. And by the way, if you look at the total crushing and screening, taking both the mining side as well as Aggregates side, we are still bigger than the next 3 combined. So we are really, really on good position for our Aggregates segment. Then looking at the development during the last few years, so if you remember, McCloskey acquisition was happening at the end of the third quarter of 2019. So the fourth quarter of 2019 was the first quarter included in our figures. So our growth has been consistent since then and maybe to focus more on the profitability here. So if we look at the long-term development, so kind of taking a little bit further than 2019. If you look from -- starting from 2016. At that time, our capital or let's say that our big improvement during this time frame has actually come from capital businesses, which you were kind of referring in earlier questions from Eeva. From -- if you compare to 2016 time frame, at that time, the business -- capital business was a low single-digit business in average for previous years. Then in the last CMD presentation about 2 years ago, we were talking that it's high single-digit business on the capital side. And today, we have actually been already for quite some time on double-digit business on the capital business. Then on the aftermarket businesses. So whenever I was saying that the capital side has been improving more, that's on the Aggregates side, roughly the improvement over the kind of longer period of time. And then if you look at -- then take a little bit shorter look to look what are the recent developments, what are really the things that are currently in our business impacting the profitability side. So first, I'll call the proactive backlog management, and proactive backlog management for us is actually something that we started about a year ago. When the demand after COVID started to really rapidly increase and at the same time, the global logistics started to go kind of almost belly-up in a sense that there was a shortage of almost everything and the demand was just unbelievable at that time. So what we started to do is that we actually -- we started to allocate our capacity to our markets and to our distributors. So instead of allowing everybody to just place orders, plenty of orders to us, we said that, okay, we know -- we don't know how many machines we are able to make 9 months down the road, but we do know how many machines we can do 3 months down the road or 6 months down the road. So we sold only those machines. We took orders only for those machines. Our distributors were sending us more orders, but we didn't recognize those orders. We didn't book them until we knew when we are able to deliver those machines. And this, of course, proved to be a very, very good method when the inflation hit in. So early this year, we started to see that, okay, the cost is rising really rapidly, and we are kind of facing really a lot of inflation cost increases coming almost every week from our suppliers. Then at that time, we decided, okay, now we can also set our pricing according to the kind of short term -- or when we booked the order, we also confirmed the pricing of that order. So we didn't book orders for 9 months down the road or 12 months down the road, we were booking orders for the next 3 months, next 6 months. And then if distributors were sending us more orders, we didn't book them, and we didn't price them. Only at the time when we knew that the material is coming in, we knew when it's coming in, how much of part is coming in, how much of engines or whatever, crushers, we had in our inventory -- or coming into our inventory, and we also knew the pricing of those. So we were actually able to price the machines properly to the customer. So we were actually pretty safely operating on this, let's say, with our backlog management. So pricing commercial excellence, I think we've been very, very successful on that area in the Aggregates business. We have also introduced highly performing distribution network, like Pekka was already referring to. We are very happy we have been kind of developing the management skills of our own organization and our cooperation with the distributors and also expand our distribution network globally. And then I'll come back to it later on, but we are also extremely happy with our McCloskey acquisition and the integration and the benefits and synergies that we've been able to make with that. But I'll come back to that a bit later on. Maybe a few words on the aftermarket.

Thank you, Markku. So still continuing a bit on the McCloskey and the multi-brand side of it. So from an aftermarket perspective, we've been able to grow this business quite nicely as well. So the relative growth on these multi-brands has been actually higher than on the Metals. So we're really happy to see those synergies and efficiencies coming through on the aftermarket perspective as well. Where the focus has been for us heavily is the productization of our aftermarket solutions. So the key here for us is that we want to see the improvement in our financial performance. We've seen it already. The key for us is to create easy-to-buy, easy-to-sell solutions that we are efficient to execute and provide tangible value for our customers. We've been highly successful in putting together these offerings, and we expect to see even further business performance in the future out of these as well. Thank you.

Then let's focus on a little bit on what's happening in the different regions in the world. So if I look at the world right now, it's much more regional than it was -- or the way that we are looking at the world is much more regionally than it was maybe just half a year ago, 1 year ago or 2 years ago. It's obvious that the world has changed, and it's obvious that we have to look at the world regionally. We have to be able to serve our customers regionally. We have to be able to make sure that our capabilities are there regionally existing. First, if we start from North America. That's our biggest market. So it's -- we are #1 at the market, and our market share in North America is 36% of the total Aggregates, crushing and screening market. It also has been a growth market. What will happen in the future, nobody knows. But so far, it's been growth market. And still, we are seeing very, very good demand on North American market. But the world is very unstable. So kind of predicting what will happen in the next quarters or next year, nobody knows. But at this moment, it's clearly the best market. And it's also a very high-priced market. So we get good profitability on our North American market. Then Europe. Since February, we have seen that Europe or the customers in our European continent have been starting to be a lot more cautious in their investment decisions, and we have a lot of smaller customers. So it's basically they are buying the machines from their back pocket. And when you are buying from your own back pocket, then you are really conscious when do you want to spend the money. And it's not whether you will spend it half a year down the road or 1 year down the road, but if you're uncertain right now how the business is going to be, then you are a bit cautious on the -- how to spend the money. So in Europe, we are also #1 and our market share in Europe is about 27%. China, we are #2 in China market, and our market share in the Chinese market is around 4%. There is a lot of small suppliers in China, so-called mid-market suppliers. We also have our mid-market capabilities there, but still the market is very, very large. China, as a total has been a bit kind of twofold. There are certain customers that are actually buying a lot right now, but there is a lot of customers also that are very hesitating to invest right at this moment. And it's actually somewhat related to government policies that government is kind of closing smaller quarries and kind of putting permits or giving permits for huge super quarries. So the super quarry side, we see a lot of demand for big crushers. And then on the smaller crushers on the smaller quarries, we see that they are actually not buying that much at this moment. India has been kind of a flat for several years already. We are #3 in the Indian market, and we -- our market share is around 10%. And again, there is several local suppliers in the Indian market as well. Then all the rest of the world, we are #1. So one of our strengths is actually that we are present everywhere in the world. So we have our distribution network covering just about every corner of the world, and our market share in the kind of rest of the world is about 8%. Then if we look at how much out of our own sales is coming from these different regions. So 37% of our sales come from North America. And that's, like we said already, clearly we are #1. We are selling there our Metso Outotec machines. We're also selling -- so we have several different brands that we are going out to the customers with. We are selling the McCloskey machines and Lippmann machines. Those would be the main products in the North American market. Europe, 34% of our sales within the last 12 months. India, 7%, China 6% and rest of Asia Pacific 6%, South America 5%. And rest of the world, also rest of the world, including Russia, is 5%. So you can see that Russia is not maybe -- has not been that significant for us in the past. I think Russia has never been more than about 3%, 4%, 5% in our business. And of course, naturally, we are winding down our activities in Russia like all of us are doing. Short term, we are leveraging our #1 position in Northern America. And long term, we do see that Asia, China, India, Rest of Asia is areas where we see the long-term potential for our growth. But short term, our focus is making sure that we recapture the business in North America. Really, really important.

As that recap was clearly indicating, we feel that we are well on track to deliver the growth and also the profitability. And we have already started to do that. We set to ourselves as an Aggregates segment, the target that we will grow faster than the market, and we will move towards the 15% EBITA. We are keeping the same going forward. So we want to continue to grow faster than the market and then going even beyond the 15% is now what we are aiming for. And how we have been able to do this success so far and continuing to do going forward is that we have the market-driven brand portfolio, which is then giving us also the product leadership position and adding that to the competitive aftermarket offering. And for the aftermarket offering, especially also including the capital equipment, adding the digital user experience will enable us to grow even faster across the brands that we have. And then as mentioned, we have already leveraged a lot of the synergies across the brands, and we will continue to identify more of those possibilities and opportunities, creating more efficiency for our own operations in many ways and this way also then building the commercial excellence out there in the different marketplaces.

Then if we dive into the customers. We -- like mentioned already at the title of the presentation, we have a very, very diverse customer base. We have a multinational civil contractors. We have large quarry producers. We have mid-market quarries, and we have a small local family-owned contractor businesses. So kind of father and the son and maybe the mom as well in the business. So really wide scale of different type of customers. Then both Pekka and Eeva were mentioning about product and aftermarket business, and our business is actually product and aftermarket business. I was checking that last year -- this year, the -- if you look at how our Aggregates business is divided. So capital is about kind of -- or aftermarket is about 34% -- 33%, 34%, thereabouts right now, and then capital is the rest. And if you take the capital business, and I was checking that how big portion of the capital business is actually projects, kind of project deliveries to our customers, and it's actually -- it's a few percent, it's 3% of the total Aggregates sales volume is project deliveries. So that's why you don't see announcement that -- announcements, press releases that we took a big project in Aggregates. We don't sell big projects. We sell products to our distributors, and we deliver those to customers. Occasionally, we have some big projects, but not really a lot of them. Then our equipment portfolio, we are carrying several brands, and we are going out to the customers with several distribution channels. So each brand has their own distribution channel. So we have our kind of flagship Metso Outotec brand, which is a very wide offering for premium customers and kind of price point is very high. We have Shaorui acquisition or -- we acquired -- 2014, we acquired 75% of the company, and then 2 years ago, we acquired the remaining 25%. So we fully own Shaorui today. Jonsson acquisition in 2018. McCloskey acquisition in 2019. Lippmann actually came as part of McCloskey. McCloskey just had acquired kind of 2 months earlier than we acquired McCloskey, they had acquired Lippmann. And then Tesab acquisition, just kind of a few months ago. So kind of several different product offerings targeting different customer value proposition. So -- and we have very different customer schemes or customer types. So we have actually different value propositions for those customers. Then on aftermarket.

Yes, the same applies. It's very productized offering that we have in the aftermarket, both spare parts, wear parts and then the service. But -- and understanding the diversity of the customer base means that we also need to have a different kind of product offering based on the customer needs. It's definitely totally different kind of customer need in mid-market in China than the large premium quarry somewhere else. And by doing that and at the same time then leveraging the synergies of being global company with all these brands in our portfolio is giving us the possibilities to look the best optimum way of organizing the supply chain suppliers and so forth, having that like a self-help possibility for ourselves when supporting all of these customers in different segments. And talking about serving the customers. So -- in aggregates, we are doing a big part of our business through our world-class distribution network. This is, as mentioned already a few times today, something that we took really professionally from the beginning of the Metso Outotec. And the distribution management office has been established, creating new ways of operating, new ways of working and leading and managing the distributors and the strategy has been successful so far. We have more than 250 world-class distributors all over the world in the right places. And throughout these 2 years now, we have grown the aftermarket sales by 46% through the distributors. And in adding to that also that when we have developed the online tools for our distributors, so we have seen that the growth of the online orders is even higher, it's in 50% level in these 2 years. And then looking at what we want to achieve through the distribution is that we want to have the high-performing partners who want to work with us to help their customers in their responsibility area. And there, we have had a good success, as mentioned. We have covered the world as we have decided that we want to cover from the coverage point of view. And at the same time, we have been working as a Metso Outotec to really be the most easiest and efficient OEM that our distributors are working with, creating them the possibilities to be successful with their customers, our customers. And one lever that we need to have there is the easy-to-sell sustainable products and solutions that we don't overcomplicate things, but we have these products, as mentioned many times today, in our portfolio so that they are easy to sell and also very easy to buy by our customers. And that combined with our this distribution management office concept, this is a very strong growth platform going forward as well. There, we are looking for adding new channels and continue to broaden the offering. And what that means is the digital end user experience and distributor experience with Metso Outotec will be increased and enhanced going forward, and that will create new channels also for us to reach our customers and support the end customers directly. And expanding the scope, especially in the aftermarket side, with the new products will be also key to success in continuing the growth journey that we are heading.

Good. Then continuing on the sustainability topic. This is a big topic in the world, as we all know. We all live in the same planet. And for us, this means actions towards our customers and towards us ourselves in that sense. And we truly believe that this is the license to operate practice. We all, both us as Metso Outotec as well as our customers, we need to run sustainable operations in the future, and that's our license to operate towards our society as well in that sense. How we are then doing this? We are looking at the customer benefits. On the handprint side we have, for example, electrification program of our equipment. We are looking at designs where we embed health and well-being, making sure the designs of the equipment and parts are built in a way that they can safely be installed, there is no exposure to the users when they are using the equipment. Then we have something like used wear parts return program, as Pekka was referring to in his opening statement. I'll come back to you on that one a bit more. It contributes both to our handprint as well as our footprint. We are committed to these net-zero factories, so reducing our own emissions, working heavily on that front to make sure that our own operations are net-zero by 2030. At the same time, we are engaging our suppliers. So we are committing them to the science-based targets, encouraging them to join the journey. So definitely, we want to be an all-around sustainable partner for our customers and a sustainable supplier for our customers. Thank you.

Then if you look at our #1 topic in sustainability from equipment point of view, it's electrification. Today, of the products or the capacity that we supply to our customers already -- about 50% is electrified already by today. We have 3 different product categories, kind of stationary equipment, which is fully electrified; wheel-mounted equipment which is fully electrified already; and then we have track-mounted electric -- or track-mounted machines, which is roughly about 15% electrified today. And a few months ago, we were announcing that we have a major R&D program, EUR 20 million being invested in electrifying these track-mounted equipment. So by far, the biggest R&D effort is happening on electrifying those track-mounted equipment.

Then here, we have some good case examples from India. So how we can run sustainable operations, how our customers can run sustainably. So first of all, you can see that the customers have opted for electric-powered units in this case. So electric-powered plants which they can use renewable energy to power those plants, making sure that we can offset the emissions on that. That's, of course, the customer decision, what kind of power they use, but the electric equipment enables the utilization of renewable energy. Simultaneously, they have gone for a life cycle services contract with Metso Outotec. And as part of this life cycle service contract, we have a used wear parts return program. So we take back those, what we call, scrap liners, used liners, return them back to our foundry, use them as prime raw material for us. It's the right alloy for our operations and this has multiple benefits. First of all, you can see the emission benefits, the environmental benefits to our globe. So CO2 emissions, air pollution, water usage, water pollution, they all go down. These are measured targets that we have or measured numbers from our operations. Simultaneously, this prime raw material, it's really good for us. It stabilizes our cost structure. It's high quality for our production, and it reduces the exposure to external world when it comes to raw material purchases for us. So it stabilizes our internal -- our procurement side as well when it comes to raw materials. Then we referred a bit to our productization of aftermarket solutions. And of course, where this all starts is that we help our customers, and we are their partner when they select the equipment that they would operate with. So it all starts from the fact that we understand what our customers are aiming for, so whether they go for a stationary plant, semi mobile, mobile plant. So our equipment team helps our customers to make the right selection of equipment. Of course, for all of our customers, we make sure that we have our high-quality spare and wear parts and technical support available at the convenient time and a faster response time close by. And that's why we have our extensive network out there in the world. But then we have these solutions where we can help our customers to reach their targets better. So we can say -- we can -- we have productized services that if customers are really looking for uptime improvement, uptime guarantees, we have solutions that enable them to get guaranteed uptime hours out of their equipment. We also have solutions that if the customer is looking for maximum capacity out of their production, we can help them in their journey to get to that capacity what they are striving for. And as last, and the most furthest, we have committed to performance. This means we look at also the quality aspects of it, the balance between the different end products that the customers are producing, committing ourselves to the journey with our customers to reach those performance targets. These are really good, and we -- the customers really appreciate these commercial solutions. It's also efficient for us to sell these because we can execute them in an efficient manner since they are well productized and it provides a clear benefit to us and our customers.

Let's add one more element for the sustainability and the captivity game, and that's the digital offering that is driving the growth and definitely improve the captivity on the aftermarket side. We are dividing these to 3 segments here now in this presentation. Start is the intelligent crushers digital offering, that is the core of every crushing plant is the crusher. And by having the intelligent crusher in a portfolio will secure the market leadership in this core technology also going forward. There are a few products inside this. This offering is -- are, for example, the advanced automation, where we are increasing the elements of the automation in the machine level and then also getting a much more accurate machine vision type of products, helping a lot of understanding what is happening with one equipment. Going forward then to the fleet management offering. The target there is to improve the customer experience significantly and then by doing that, growing the aftermarket. I will talk about more in the next slide about the fleet management, but just mentioning that the flagship there is the Metso Outotec metrics system and then, for example, the remote control that enables the sustainable, safe operation of the fleet and equipment. And then finally, again, talking about the different customer needs and customers. So for the quarry type of customers, very essentially is to get the process and operations optimized. And our offering on this field is leveraging not only the intelligence of the crushers and the fleets, but also then the big data that we have when we are operating in all over the world and collecting this data to our database. So helping then the customers to optimize their processes the best possible way. Quarry AI is our plant level automation system in use, and equipment, health and maintenance is essential in the quarry types when they are sometimes 24/7 operations. So they do share something like mining type of needs also to these customers. But let's go for the fleet management solutions, optimizing the performance. We have more than 500 customers currently connected to the Metso Outotec Metrics system, that means close to 2,000 unique equipment that is connected to our Metso Metrics. And what is the target here for the customers? It's simple. Maximum output with minimum effort, optimizing the operations within the fleet enables customers to get the efficiency and the profits out of the fleet that they are owning. Remote control. I was mentioning that one. It's easy to operate, but also a safety aspect. This means that the mobile equipment can be operated, for example, from the excavator cockpit by the remote model, not needing to go for the risk zones of the machine close by and also, of course, making it very easy to operate even 2 equipment at the same time by 1 operator. Ensuring availability and also giving us the possibility to support our customers. The higher uptime is directly linked to the profitability of the customers in many ways, and that means that we can then also earn money from the relationship. And when we combine this fleet management solution, the digital offering with our so-called traditional offerings or the products that we have, this supports significantly the growth. Aftermarket captivity goes without saying, having customers connected to us, getting the support from us will leverage a lot the aftermarket part of the captivity. And then having information and data helps us also in the equipment sales and especially having the proactive sales approach towards the customers with the help of the digital tool and data that we have. So this is one big lever for our journey onwards as well.

So how do we get to 15% EBITA? So there are 3 topics here: commercial, aftermarket and internal efficiency. So commercial excellence. I think we already have been discussing about that quite a bit. It's about our sales channel. It's about how we manage our distribution. It's about tools, it's about processes. Pricing management. I think we are very -- we have a very strong position in our pricing. So we are -- we have different products for different price points as well. Product leadership. Being so much bigger than the next competitor, I think we have the muscle to develop the products to be a leader in the products. Then if I look at the internal efficiency. Supply network, sourcing network, cost-competitive locations, logistic efficiencies, very big topics already mentioned in the earlier presentations. Maybe one thing to highlight that we have a major investment ongoing in our India facility in order to expand our low-cost product. And that was announced, I think it was November last year, and we are in good process of building that and should be in operation early next year. Then on standardization of the products. So first of all, we don't really like to sell too much specials. We like to see standard products when you are dealing with or when you have a distribution network, distribution network is really, really dealing with standard products. That's where it's efficient. That's where the lead times are fast and customer on-time delivery is good. So we like to standardize even more our products. And at the time when we are developing this electric portfolio with our major R&D investments, we are actually also modularizing our offering at the same time, which then gives us a lot of benefits going forward. Probably the benefits will show on long term, so not this year or next year, but it's more like 5 years down the road, 6, 7 years down the road, we should see a lot of benefits coming out of that. And then, of course, we have these multiple acquisitions that we've been working on, there is a lot of procurement opportunities, cost opportunities and many kinds of opportunities to find leverages there as well.

Yes. Then on the aftermarket captivity side. So basically, we want to be easy partner to do business with. So we want to be accessible and responsive to our customers and to our distributors as well. We want to have the complete range of solutions and products available to cater each and every customer needs out there. So that's why we have these different products, and we have the different channels. And we are expanding our reach continuously. We have multiple brands, we have multiple sales channels, and we want to make sure that our products and services are accessible and available for all of the potential customer base out there. Then if we look at a bit what I was referring to, the McCloskey and how well the aftermarket business has developed since the acquisition of McCloskey. So we have -- as you can see on the trend, there has been a healthy 50% growth on our aftermarket business. And how did we do this? If we look at it in Metso Outotec brand, we have the highest share of aftermarket in relation to the equipment sales. So we took the know-how, the experience, practices of Metso Outotec brand and implemented the core of that to McCloskey. And we are doing the same things for the other multibrands. So we have that accumulated know-how, that knowledge how to run aftermarket business in a more efficient way. We can also utilize the synergies across it, in our procurement, our manufacturing and so on and distribution as well. So that helps us to take full advantage of this one. The key for us at the same time is the platform. So we build on the brand promise, the brand customer experience that is there, and we tailor our products to suit that one. And that expands our reach and enables us to serve different customer categories and segments within the aggregates.

Then I've been talking about this -- or we've been talking about these cross-brand synergies. Here is an example or actually a kind of a summary of gross brand synergies. So in last year, we had a bit more than EUR 70 million synergy sales, more sales because of these synergies. We are taking our spare parts, wear parts and selling those through these McCloskey [indiscernible] channels as well. We are taking our metals or the crushers and installing those crushers into the mobile units of these other brands. And then having better crushers and actually getting higher price for the machines when selling with better crushers. Then we also have complete products. We are taking complete products that we are then rebranding into different colors and selling through different sales channels as well. So through different distribution networks. Last year, we were gaining about EUR 12 million on the bottom line impact out of these synergies coming in here. And I'm sure that this will continue to go forward in the future. And by the way, so far, by 2021, actually, majority of that growth has been on capital side. So the aftermarket side will grow when the installed base is growing. So aftermarket growth is kind of a few years behind the capital growth always. So that -- there is a kind of aftermarket opportunity still waits there to be gained. And a customer example of this rebranding or cross-branding. So once we acquired McCloskey, one of the major sales synergy actions that we had was to take part of the McCloskey offering -- machines that they had in offering but our kind of main brand, Metso Outotec brand did not have. So we took those products and rebranded those to the Metso Outotec channel as well. So selling kind of same products through 2 different channels to the customers. And there are so many customers that kind of -- we just increased our reach with the products by doing that. So with this, we started from 0 in 2019. And in last year, we made EUR 35 million worth of sales with this new truck offering. So new product family that we established by the rebranding. So really, really successful. Our target was actually much lower than that. So it was a very positive surprise that how much we were able to generate business. And actually, we could have made even more if our availability would have been better. So the opportunity is still there to grow. Good, then time to go for wrap up.

So basically, what we want to say here is that we do continue to deliver growth and higher margins in the Aggregates. We feel that we have the right means to do it. And definitely, we want to utilize and leverage our efficiency and our multibrand synergies to do that.

And expanding the aftermarket business stays in the center of the agenda. We see that we have still room to grow in the aftermarket era and adding the digital enablers to that acquisition will also then create the efficiency of those operations and helping us to deliver the margins.

And then we drive sustainability, sustainable growth with our electrification program. So we will reach our targets. We will grow faster than the market is growing, and we will be more than 15% in EBITDA. That's our very, very good target. And by the way, we have a great team to achieve that.

Good. Thank you, gentlemen, for the presentation. And let's kick off with the Aggregates Q&A session. I think Erkki Vesola has a question at least. But let me first take one from the webcast, a quick one from Magnus Kruber of UBS. What would be the leading indicator or indicators you are looking to try and estimate the demand in the North American market in the future?

The leading indicators are our -- the distributor inventory is a good leading indicator. So we are following how distributor inventories are developing. And so far, if you see that distributors are hesitating to fulfill the inventory once they have sold the machines out, that's a very bad signal. And a second or another type of a bad signal is that if distributors are fulfilling their inventory, but doesn't -- don't kind of -- it builds up and it doesn't kind of start to move out to the customer. So that's maybe #1 indicator. And then, of course, we are following closely what the kind of soft signals are coming from the market as well.

Anything that you could follow from the kind of public domain?

Very difficult to see in the public domain any kind of clear short-term indicators. Long-term indicators would be the investments happening in the infrastructure. So our business is basically based on building roads, building dams, building railroads, building airports. When there is big investments, then it means big machine sales for us.

All right. Thank you. Erkki?

Erkki Vesola from Inderes. Again, my question was actually partially already answered. But still coming back to the North American market, we know that the interest rates are rising there. And of course, all the construction material prices are out of sky. But do you see any early indications from customers, customers kind of project cancellations or postponements that would impact your direct customer volumes and investment demand?

So far, we haven't seen indicators like that. And kind of -- in Europe, we do. But in North America, we really don't see those types of indicators. And like I said, many of our customers, first customers kind of distributors, customers, they are small operators. So they are really looking at their own bucket and kind of next project down the road. So it's very, very downward kind of a business. It's not long-term strategic planning. It's kind of what's happening right now and next week.

Okay. Thanks. Tom here.

Yes, this is Tomas Skogman from Carnegie. I'm very happy to see the kind of service growth in McCloskey and -- but the fact is still that the service share used to be much higher in the Aggregates business. So first of all, have you changed anything in the -- where you do the bookkeeping? And should we kind of think that the whole business could reach to all good share of kind of aftermarket activities? Or is there something structurally how they are sold or the type of products that suggest that you cannot reach that with after all these acquisitions?

There's nothing changes that we have done as such. What has changed is that we have, for example, the McCloskey brand now in the portfolio. And what is the difference is that when you have a fully mobile unit type of offering, the spend of -- customers spend of aftermarket is totally different as a share of capital equipment and the services. Then when we look at traditional queries where the legacy Metso was also strong in share of the portfolio. Now we are much more in the mobile side. And therefore, our target is to be at the 35%, 40% share of the aftermarket. And currently, we are in the 35% as said. So not far away from where we believe that the good lies. But as I mentioned, we have room to grow in the services.

Maybe I'll add on that a little bit. The -- if you look at the traditional metal business, we have a huge installed base. We have a very capable service network. We have a lot of kind of processes and procedures and capabilities in place for many, many years. And with that, the service intensity is somewhere 40% thereabouts. When we acquired all of these acquisitions, when we acquired their service level was around 10%. So it takes years before that 10% grows up. And it will probably never reach quite 40%, but it will -- it should be somewhere around 30% levels.

Is the reason that in the quarries, it's like products that you install and then you modernize them, but they're there forever as long as the quarry is there, but then the mobile equipment is kind of you replace them and you change the diesel engines, so they have a lifetime of 7 years or so instead of 40 years in quarries. Is that how we should understood?

You are very correct. And there's also a big difference if we looked at how many hours is utilized or used the equipment per year, for example. So in the contractor segment, there is not 24/7 type of operations with the customer. So there's less hours there. There might be more sales in unit of equipment, but then they don't utilize the hours so much, which is always quite a direct link of the services and consumables, especially with the product tons. So the quarries do operate 24/7, lot of hours, and there is a need for refurbishment overhauling and more that type of services as well in the quarry type of business.

And then the service margin, you were very kind of outspoken about the equipment margin. But on the service side, when you merge kind of service organizations, I mean, the very strong operating leverage benefits. But it sounds like given the -- you stated what the equipment margin, it sounds like the service margin has not really improved so far, at least that much from adding much more volume to it. So can you open up a bit about that?

I think we need to split here once again, the consumables and the other part of the services, which is then more spare parts and the field service. So consumables have had their challenges as a business. When I look at spare parts part, then there is no that kind of issues visible. There is an improvement also in the margins and also in the business volumes going -- looking at the last 12 months in the Aggregates segment.

I'm just wondering if I could ask about the numbers you gave around connectivity. I think you said, I can't remember the exact numbers, maybe 2,000 units would connect this link. Could you sort of put that into some sort of context, like how much is that? How much is the penetration of connectivity so far? And how much further could you go with that?

We have an installed base that can have -- it can be delivered 30 years ago and still its existing. There is not so much upgrade type of business in the Aggregates segment that the customers would like to get a very old installed base, still working to be upgraded for the connectivity level. So that number is good when we look the deliveries that we have done since we started to install that very actively to our portfolio. So it's very high in that sense. But when we look at the whole installed base, it's like fraction because it's only the new installed base that had this opportunity.

But that you have done on -- I mean you can see that there is a material benefit in terms of the relationship with the customer, the aftermarket capture and so on and so forth.

Correct. And heavily increasing, of course, when we get more and more the data and when we can connect the algorithms to understand better and so forth. So that's happening.

Okay. And then just maybe just a slightly different topic. I'm just curious about everyone's worried about a downturn and what happens. And obviously, we don't know what's going to happen in the next couple of years. But maybe sort of if you look at the history of the business, going back to sort of previous periods of financial crisis or whatever it might be, what kind of sort of level of slowdown have you seen? Do customers cancel orders? Is there anything that stops in doing that? I mean what sort of levels of cancellation do you see in a downturn?

I was talking about the backlog management and actually that backlog management helps us a lot in that situation. So we don't book orders 1 year down the road. So we're kind of -- that would be the risky part of the backlog, if there would be, would really, really long backlog. So that's one thing. Then looking back to first part of your question, looking back at the history that what has happened in the previous recessions or financial turmoil, our business, especially the capital side, maybe not so much on the aftermarket side, but the capital side is very fast to react to any market changes. So if there is an uncertainty or turmoil or something happening, then our distributors and our customers, they react almost immediately, and they kind of hold on to their investment. So we see it quite quickly. Earlier, we have seen -- 2008, I wasn't actually at that time in the business. At that time, there was a lot of cancellations as well. In the kind of last crisis, I guess, COVID was the last crisis. There we didn't actually see that many cancellations. There were some. But we -- at that -- when COVID really started to hit, that spring was really awful for us. We didn't get any orders, 0, nothing coming in. It was really terrifying for kind of couple of months. But if you look at the backlog, most of the backlog was still moving. So it didn't actually impact, but the uncertainty impacted the new orders, not to be willing to take new orders. And then when it goes up, it goes very fast up as well. So the business, when it starts to go up, when COVID was starting to kind of -- when I was looking at my colleagues, they were not even seeing the downturn of the colleagues when after COVID-19 when I was already seeing that the upturn coming after the COVID-19. So it kind of fast in both ways. But current situation, I wouldn't expect any major cancellation order. So backlog is pretty safe to deliver.

Yes. And if I look at it from the aftermarket perspective, so we are -- for our fast-moving items, it's not an issue because the market keeps going all the time. But we are keeping an eye on the slow-moving items, making sure that we don't over stock on that side. So kind of keeping a healthy level on that side, making sure that the slow moving items, we don't pile up too much.

Just to clarify, on the comment you made about not taking orders on a longer lead time, trying to keep it, that the strategy is now going to be to keep it like that.

Yes. That's what it looks like because it's been so beneficial in this turmoil period. So I think we will be continuing with that strategy also going forward. But it might be that we extend it a little bit when our visibility to cost structures and availability of the part extends. But we wouldn't book orders for stuff that we have kind of no visibility on our side.

Yes, maybe a follow-up on the previous question and especially relating to Europe. And if you think about the market kind of since the COVID-19 first shock, I mean, how would you describe the levels that we have been? Has it been mostly just the pent-up demand being fulfilled? Or is it the prior to February, has the market been at the extraordinary high level? And also kind of how dramatic do you think the slowdown now that you are seeing is? I mean, it's a broad question, but just based on your history and the cyclicality in European business, where -- what should we expect now?

Long question and difficult to answer as well. The -- if we look at the kind of after COVID, the ramp-up of orders was truly extraordinary. It was far beyond our capability to deliver. And that's why we started this -- these new procedures. Then that was still continuing at the time when war broke down. But then when the war broke down, that we saw immediately -- I was actually expecting that it would be a very rapid drop of orders. We saw a softening, we didn't see a rapid drop of order. So it was not like the COVID came in that everything disappeared completely. It was softening. North America was continuing pretty normal, but the European level has been lower. Now if I look at kind of current speed of orders over the first half of this year or maybe the second quarter of this year, the orders there were not far from last year. In terms of Europe, if you look at the European orders, it was not far from last year, maybe a little bit lower than last year, European kind of orders. But then, of course, we had a major price increase in between. So euros don't tell everything. But if you look at the actual machines, then we are probably, say, in Europe, maybe 15% below last year in the number of machines at this moment. But it's kind of a -- it's nowhere near as bad as I was expecting actually. Go forward, I have very little wisdom on saying how this is going to develop going forward. So we'll see -- wait and see. We are fast to react anyway.

Okay. And then second question on the profitability. I mean you're happy with your backlog management and pricing. I guess, you have a tremendous growth on the equipment volumes and euros as well. But I mean, you're lagging the 15% target, and it has been kind of flatlining in the past couple of quarters. So could you just quantify the lacking parts? How much is that kind of external headwinds and something that you could address yourself?

There might be a little bit of external headwinds and things that are impacting currencies, currency hedgings and things that have been impacting. But I'm really confident on going forward. So we are heading right on that direction. I have no doubt about that.

I'll take a couple of questions online. First, in Aggregates aftermarket. Can you a little bit break down the shares of consumables, spare parts and other services in this segment?

50-50 between spare parts and wear parts basically.

And very little other services, if at all.

Yes, especially when we are doing it to the distributions. So then distribution is taking care of that part of the business.

Exactly. Continuing from that question from the Debashis, Societe Generale. How much of the installed base you are serving is your own versus serving other OEMs equipment?

Well, for consumables products, we don't specifically care who's installed base. Is it -- majority of the business comes to our own installed base, but we do serve our third-party equipment as well. The percentage is not that big. But we have the capabilities to do it, and we have been growing that part of the business as well. But we are talking about single digits when it comes to third-party installed base.

In the rest of the aftermarket, so spare parts and field service. So the main focus has been in the own installed base so far and now looking for the opportunities for helping the customers broader.

Then about business in China and Asia Pacific. How much of those sales are manufactured in Europe.

Not a lot. We -- most of the products delivered to China are actually made in China. Today, actually, I would say, probably even beyond 90% is manufactured in China, which is delivered in China, at least on the capital side. And then same in most parts in Asia that products are primarily coming from our India facilities to most of Asia. Maybe there are some countries where we deliver some products also from Europe, but most of it coming from local supply.

Yes. And from a consumables perspective, Chinese market is served inside China. So we have suppliers inside China to supply that market. And rest of Asia Pacific, we supply either from China or India.

All right. Then Magnus Kruber from UBS asked about consumables margin. And Heikki, now that you're -- you happen to be here. Let's ask about that. So Magnus asks where sort of are you now because company has been flagging some pressure on consumables and what you are targeting?

Yes. So I'm not going to give explicit numbers on that one. But let's put it this way that -- on the Aggregates segment, if we talk about consumables margins, we have, of course, had our share of headwind coming from the energy and logistics. And logistics is a big part, especially on the Aggregates segment. But here, the Aggregates products are more standardized. So for us, our inventories have been buffering the impact. So the relative performance of consumables in Aggregates segment has been better than in the Minerals side. So this is why our -- it shows up in the segment numbers as well. But let's put it this way that we are -- we have been in the low double digit, daily double-digit now, and we should be strong double digit in the consumables overall in the future.

Good stuff. Any more questions? Yes, Panu?

Yes, thanks. So I just wanted to ask on the demand drivers. So you said that infrastructure investment is the key. But I wonder what kind of correlation have you had for the noninfrastructure construction in your demand? Or what have you seen like housing and the other segments?

Naturally, there is some correlation, but it's rather a minor part of our total business. So it's really the main infrastructure projects that are driving our demand. Housing, of course, there is concrete in there, so sand and there is aggregates below the house. But as a kind of a total amount compared to the kind of highway building, it's rather insignificant from our demand.

And this is the same across markets.

I would say so, yes.

All right. We have been discussing Aggregates for 60 minutes now. So it's time for a break. Thank you, gentlemen, for your discussion and presentation. We'll have a break for 10 minutes, so we'll be back 20 minutes to the hour for Minerals.

Thank you.

Thank you.

Thank you. [Break][Presentation]

All right. Welcome back, once again from the break. We are continuing our segment presentations, and now it's time to discuss Minerals. And we also, in this presentation, have 3 gentlemen on the stage, Sami, and Heikki will continue, and they will be joined by Head of our Minerals Equipment business, Markku Terasvasara.

Okay. Good afternoon from my behalf as well.

Hello again.

Hello again from my side as well.

And welcome to the Minerals journey for profitable growth and customer success. Minerals was one of the segments where we had biggest integration when we were combining our 2 companies that was through both on capital side, but also on aftermarket side, apart from consumables. And you will hear more about the combination. But as we see it, we combined 2 sizable businesses, which were already performing quite okay. But what we knew already then was that they actually complement each other in a very good way. So in our case, it gave us a very strong portfolio and platform to build on. And also, in our case, 1 plus 1 definitely equals more than 2. But let's look at little bit on market sentiment first and then also reflect our achievements, what have we done so far and then going towards industry trends, customer challenges, and of course, how do we help our customers to succeed because that's one of the purpose that we have. We would like to succeed ourselves, but we can only do it if our customers are successful, like Pekka said already earlier. And then I'm sure that towards the end of the presentation, we are interested to hear how is our journey towards this 20% adjusted EBITDA target that we have. But first about Minerals market sentiment. And that was also covered already by the previous presenters. Market activity is strong, mostly driven by copper, gold and battery metals, and combining copper and gold for Minerals, that is good half of our business. And of course, as a newcomer, we have battery market very active. Not so many greenfields, but the brownfield market is active. And even though metal prices have been trending a bit down, but they are -- historically, they are on a good level and definitely supporting investment. We are well -- of course, as a disclaimer, we all know about the volatility that exists. This is also a very cyclical business where decisions are done quickly and investments may be put on hold if the wrong signals emerge. But as a company, as a Minerals segment business, we are definitely well positioned. We are -- we have done the homework for the last 2-plus years. Combined our portfolios, worked on a product positioning and already starting aligning our new product R&D so that it fits the customer challenges, it supports the customer challenge, but also creates opportunities, more opportunities for aftermarket and then sustainability has also been one of the driving forces. We mentioned this Planet Positive orders and sales that we have in the -- since last year, a way of measuring how environmental friendly our products are and services when we sell them. Of course, sales is a little bit dragging behind. But on the order side, more than our -- more than 50% of our orders on the Minerals side are already Planet Positive orders. And I think it's -- what is also encouraging, and among those orders, we also have the products that has highest sales margins. So in that sense, I think, as said, we are well positioned to capture the brownfield investment code, complement that with [indiscernible] digital solution and then definitely make sure that our aftermarket gets more opportunities. So what have we achieved since the merger? We have had COVID, we have had Russia case. Maybe for Minerals, the Russia impact is bigger than for the average Metro Outotec business. We have typically had some 10% to 15% of orders coming from Russia. This year, we stopped our business. So basically, we are winding down existing contracts, but we have not taken any new orders since the war began. Still, I think the order intake is developing very well. So remember, this 10% to 15%, we have been fully -- we have been able to fully compensate that from the growth from other markets and other market areas. And we are actually on the orders side, we are on our way to our full year target that we set to ourselves originally. On the sales side, sales is also catching nicely with the backlog with the increased backlog. However, there we don't have time to fully replace the losses that we have in Russia this year. But of course, going forward, that impact will diminish. And then we still have -- we have been able to capture, as you will see later, sales synergies of combining the 2 portfolios. But there are more opportunities to capture, we can discuss later. So Heikki, what can we say about the cost inflation?

Yes, but I'm still going to go from the aftermarket perspective, back to this synergies. The synergy business that we have achieved since the merger is now creating cumulative business opportunities on the aftermarket side. We get the installed base and we get to serve the aftermarket and that builds up with the synergies. So we are really confident on that front. Of course, now cost inflation, a big topic. We've all heard about it already. It is true that we have been facing headwind on that side. But now we have taken the necessary actions, the pricing action. It was a lot of tedious work to get the prices up to the level that we offset the cost impact to us and also a lot of contract negotiations that we've been undergoing. So we do feel that we have now matched it. So the coming sales, we expect to be on a better level in that sense in terms of profitability. We are accelerating our aftermarket business. So our aftermarket order growth has been picking up really nicely, and we now see that the sales growth is picking up speed really well as well. And then we have plenty of initiatives on the commercial excellence, productization, supply chain and manufacturing side. So there's a lot of sales help initiatives that will help us to gain margin uplift on what we are doing. So there, the key is those self-help initiatives that we are doing.

As said, we have had really strong order growth in the Minerals segment, especially in the last 12 months. The graph on the left is now comparing our order booking in the Minerals segment to our competitors and peers. As we can see, we started to be well on par with the speed and then now accelerating even faster than most of other peers in the game. But this order intake that we have been taking, it's part of our strategy. We want to focus on the products and projects in the capital side as well where the aftermarket captivity and intensity is the highest. And where we are today now when looking at the sales split of the last 12 months on the right-hand graph, again, comparing to other players in the field. So we see that our split currently is a little bit less than 60% of the aftermarket and then 40% -- 42% of the capital. We ideally want to have this share to be more on a 35:65 or 30:70 level as well. And now what we see is that those orders taken and the sales happening at the moment, they are creating very nice installed base out there in the marketplace for aftermarket businesses to pick up going forward then.

Good. We are, of course, heading towards our 20% adjusted EBITDA target. So our targets remain the same. So we want to grow faster than the market, and we want to reach our adjusted EBITDA target of 20%. If we look at our performance today, on the growth side of it, we're doing well. So we are growing faster than the market. So that we have well covered at this stage. Of course, we've all heard we have had some challenges on our profitability performance, but we truly believe that we have the right actions. We have the right tools at our disposal to go towards that 20% adjusted EBITDA. The margin drivers, we're going to go through in more detail in the coming slides. But if we look at it, we want to have leading offering and customer value. So premium products where we can have premium margins as well, that's in the core of it. We have those Planet Positive products. We have those leading offering the best-in-class technologies at our disposal. At the same time, the commercial excellence efficiency improvement. We still have a lot of work to be done in our internal operations, how do we conduct the business. So we have that self-help potential to take us and provide us an additional margin uplift.

Then let's have a brief look at industry trends and challenges that our customers are dealing with at the moment. I think the list is very well known by everyone. We definitely need to find ways to reduce the energy consumption in minerals processing. And we've become [indiscernible] on what Metso Outotec what we have done in that area. Water is already a critical resource in many, many areas, where basically mining competes with society, other society, agriculture and definitely all the technologies where you use less water, less freshwater, recycle more, maybe even have a process where you don't need water at all, they are coming to levels. Reliability is very much both on equipment R&D side, but also on digitalization to make sure that our plans and products perform as they expect to do. We continuously install more and more capacity to our equipment. And of course, that -- to get that capacity out, we need to make sure that also the control systems develop accordingly. And Agility, I think one good example of that is that we have developed over the years these modular containerized products. Basically, we can put a hydrometallurgical plant or part of a concentrator plant in the normal sea container and transport that easily, stack them together at the mine site and then we have a very quick installation of the performing process. And of course, sustainability. As you mentioned already, we want to be sustainable partners to our customers. So let's look at this a bit more in details. This picture illustrates a concentrated plan, a typical one. And then on the right side of it, you also see a hydrometallurgical plant. And this can -- this slide can actually be discussed in various levels. You can talk about customer challenges because you see the process flow. We can talk about our installed base and the synergies that we have an aftermarket opportunity. And we also can discuss our portfolio priorities and development actions. But let's, if we start from our position and portfolio, on the right-hand corner, upper corner on each box, you have our position on the marketplace. So where it is? One, then we are the biggest supplier in that particular equipment operation. And that is what I mentioned earlier about perfect combination because crushing Outotec did not have. And of course, hydrometallurgy was coming from that side. Both companies was fairly well positioned on the grinding side and then towards the wet processing that was more in order. So basically putting 2 portfolios together created 1 portfolio, which is definitely the strongest on the market. And in many of the areas -- in most of the areas, we're actually the biggest supplier. And if we are not the biggest, we are definitely in top 3. We also talk about aftermarket intensity. So in that -- and if you look at this picture, the most aftermarket-intensive areas are grinding, crushing, slurry handling and filtration. Also screening is quite big. But if you look at the top 2, they are grinding and crushing, and we are #1 in those areas. So also -- and you will see it later in our R&D priority works. So we are strong in areas which actually generates good aftermarket business. And then we do want to still have the full plant capability even though as a company, we want to focus on productization and designing, delivering, selling equipment with significant aftermarket opportunity. But we want to keep the process knowledge that we have in-house to make sure that we have the capabilities to advise customers on the best possible concentrator plant process or the hydrometallurgical plant process. And when we are doing it, we actually quite often then guarantee also that we are able to deliver the main proprietary equipment for that particular flow. There is less competition if you can do it. But our ambition is not to deliver more than those equipments and then making sure that we help our customers to run the process accordingly. One of the development on this space is in digital area. We call it Geminex. That's a digital twin. We come to that in the next slide. But I want to introduce it already here because if you look at the process, as it is run today in most of the cases still, our customers are running their concentrator plant based on averages. So they assume that ore is always the same. It has the same structure, same content, same metallurgical chemistry. And then we know from the practice that it is not the case. They actually are quite huge variations in kind of material. So over the years, we have developed different ways of putting hundreds of sensors and analysis to our process, which we use to gather information. We have also had equipment-level automation to make sure that these individual equipment operation perform as they should be. But the latest development actually is this Geminex where we have combined all the information that we get from those sensors, from those individual equipment operations and then created an umbrella program on top of it. And that is a model that is based on our so-called HSC modeling simulation tool that we have had in the company for many, many years. But now with all that information gathered under one umbrella, we can actually then have a system that is predictive simulation for the process, which supports customers in their online decision-making based on complete oversight for the whole process. So basically, you can work on the process or the blends or the production assets and make sure that they are all optimized. And of course, the bigger benefit is there for the customer. They will increase their revenue. They can reduce their working capital and they can also reduce or improve their operating margin by using less resources in an area where they have overused them in the past. And that also opens us a good opportunity to introduce new type of selling models or pricing model. So here, of course, the first thing we like to talk with our customers is profit sharing, some sort of profit sharing model where we get part of the benefit that our customers will receive. So definitely an interesting area. It was recently launched. We have already agreed to deliver that to 2 clients or actually 3, and they are quite good pipeline building up for this Geminex, going forward. Later on, I think aftermarket, both Sami and Heikki will greatly benefit from the information that will come out of that system.

That's true. And the digital mining offering is really something that we continuously keep on developing. Geminex being one of the good example of that. And we believe that, that will be a strong lever for the business growth and also the premium value. And worthwhile mentioning here that it's not a coincidence that you see this Planet Positive stamp/logo on these slides. Like any other R&D project in Metso Outotec, the same applies for the digital. There needs to be a positive impact for the planet in every R&D project that we have, including the digital ones that we have many ongoing. And mainly here in the digital, we are looking for the handprint part, helping the customers to reduce their footprint. It's starting from those very important equipment in the process. So intelligent equipment plays a big role. Once again, they are the core of the digitalization and giving the data input then for the further use in different various offerings that we have been creating. Process and operations optimization is what the demand is highest from the customers at the moment. And that's what we are answering with our development work. So Geminex mentioned here, that added with our life cycle services concept when we are helping the customers in various needs that they have to optimize their own operations in the process. And then we also have internal efficiency gains from the digital tools and especially the data that we get. Having the -- knowing what is needed and when and where will help us to optimize our own supply operations, for example. And then in our own manufacturing units, we are using the digital tools for optimizing the production and creating the highest possible efficiency out of the situation.

So let's look back at the product development. And when we design our new products, as we mentioned already earlier, we look at couple of things. Of course, first of all, solving customer problems. So it needs to benefit our customers and help them in solving their challenges. We also want to have it a Planet Positive. So all the new development that we do have Planet Positive criterias. It includes digitalization and full flowsheet capability, as mentioned, but also we look at the productization and building a product range that supports aftermarket development in a good way. And mentioned on those areas, if you look at the lineup here for the new products that we have already launched during Metso Outotec time, the first 4 ones are on high consumption aftermarket intensity area, which, by the way, also consumes a big part of the global electricity. So it has been said that crushing and grinding combined consume some 5% of the global electricity or energy. So definitely, when we try to help our customers to reduce their electricity bill, we look at in pit crushing and conveying and we looked at various ways to grind the rock in more environmental-friendly consuming less energy. And then screens are also supporting that way. And then you go to the other end of the process, you have tailings, concentrates, also an area where we can help our customers to increase water recycling. So we take the water, purify it and put it back to the process. Geminex, we already talked about. And then maybe the one odd thing here in the middle is this compound -- this is actually also improving customer efficiency greatly, because that is a flotation technology that helps our customers to capture fine particles that typically in the past went to the tailings pond. So in some of the applications, our customers actually for the same investment, they can get up to 10% more metal with minimum investment. And of course, we call that also very Planet Positive and very sustainable.

Okay. Let's talk a little bit more about the aftermarket, services and consumables and the growth that we are looking. And captivity is very important key success factors in increasing the growth. How we are doing it is that we are the innovative leader. So we are bringing new products to the market. And by new products, you get the captivity and then you have a chance to keep the customer in your service portfolio going forward. We have field service experts, more than 3,000 globally close to the customers. Some of them working all the time at the customer site, and this is, of course, one very good way of increasing the captivity and leveraging that expert footprint that we have out there. And then expanding and continuing to create the captive business models that we have been doing already quite some time but adding new elements and creating more value through those business models. Basically, it's optimizing the operations, both the customer operations and our own operations to be able to serve with the best value and then working with the life cycle services concept further with the customers. Now we will open up a little bit more about these concepts. So how we are doing it? By optimizing the customers' performance and then creating the best total cost of ownership over the life cycle.

So we talk about customer success, and this is a big topic for us. You've seen it from Pekka's presentation, you've seen us talking about it all the time. So what is customer success? How do we start? So basically, when we start thinking about our products and solutions, we start from what is the customer gaining out of this? What is the customer benefit? What is the target that they are trying to achieve? And how is our product or solution serving that need and that target? And we have -- there's basically 3 large high-level targets. We want to lower the risk, reduce their operating cost and increase their production output. So this is where we start. When we look at our products, this is how we think. And on the lower -- risk lowering side of it, we have commercial risk, safety risk, environmental risk, and that equals license to operate. Mining industry, we need to have the license to operate. We need to be sustainable in the future, and we can help our customers to lower those risks. Reducing operating cost. We have multiple ways of doing it. We can help them lower their energy consumption. We can reduce their maintenance need, optimize their operational labor, and we can decrease water and chemical usages. So the additive that Markku was referring to, for example, with Geminex in this case. Then we can help them to increase their production output. We can optimize the throughput on an equipment level, on a sub-process level, on a flowsheet level in that sense. We can increase the uptime, get the most out of the machines, make them run as much as they can on annual basis. We can help them to maximize their recovery rate, make the most out of the material that they are processing and give them the best possible overall equipment effectiveness.

As we are digitizing our products in the capital equipment and creating the solutions around them, that means also that our customers need to adapt to this new world. And to support that, we have this very wide footprint of our field service experts out there. They are also now digitized, that was largely thank you for COVID for speed in that work that we are able to deliver the global knowledge to the front line, to the very close to the customer through our field service experts. And the demand for this is increasing all the time as there is age challenge also in the customer's own operations, including the fact that there is more digitalized processes to be run and also the maintenance part gets that direction. What we also have is 140-plus service locations throughout the world. They are selected so that they are close to the customer hubs so that we can serve several customers. And we are adding to this portfolio service locations as per needed currently. We are building one in Pilbara region in Australia. And on top of that, we have 3 performance centers. They are located in Chile, Finland and China. And they are remote monitoring centers, 24/7, keeping an eye on the customer operation and being then on alert to support and help them what the demand is that they might be having a problem or they want to adjust to certain direction. And again, here, we have a great synergy with the Geminex type of tool helping us as well to be able to support our customers through the performance centers. There is a target to have more features brought to the front line for the digital field service people or field service people with the digital tools. That's what we are doing constantly, adding more features to the equipment that they are having with them and thus, again, creating the global knowledge to be available for our customers easily. We are keeping good eye on the competence development. We have a certification program for our own people to be specified for certain technologies or certain parts of the processes. And by certification, we guarantee the quality of our support people close to the customer. And then as in everywhere, what we do, field service is the one where we have a huge risk element. We are working at the customer site. We are working with the moving parts and so and so. Zero harm is definitely the one that we have as a target. There will be no injuries happening in the future. There was a mention in Pekka's talk about the M&A. Happy to have this slide here now, just now in September, we have added to the Metso Outotec family, 1 company, global physical asset management technology provider based in Canada. And mainly serving today before joining Metso Outotec the North American market. They had a very good and interesting technology for digital inspections and especially for the large industrial gears used in the grinding mills. There's more than 8,000 grinding mills globally, which can be now as part of Metso Outotec, the synergy to globalize usage of this technology. And the really trick here is that with this digitalized inspection compared to the conventional version, what even Metso Outotec was using before having this technology now in our company. So the new technology is 60% faster, and this will significantly reduce the shutdown time for the customers and creating a huge added value for the customer productivity. And in Metso Outotec, we are looking at this technology, and we have already identified that we can find synergies for other products than just the grinding mills. And currently, we are developing this one to be available also for the crushing solutions going forward. This is quite a typical acquisition target. It's based on 1 region or 1 country, and then the globalization and leveraging other product synergies is happening through Metso Outotec.

Good. Then I want to talk about life cycle services, which is one of our core strategic targets. This is something where we want to add our business on. So contractual business, life cycle service contract is something that we are striving to increase all the time. So what we can see today, we have already more than 400 life cycle services contracts globally in the Minerals segment. Our sales growth within the past 24 months has been more than 50% through these contracts. And if we look at combined Aggregates and Minerals, we have more than 120 contracts where we have scrap return programs, what I was discussing more on the Aggregates segment side where we have take-back programs of used parts in that sense. So what does this mean to Metso Outotec in that sense? So for us, it secures and improves our profitability, enables us to manage our prices and enables us to manage the availability of our parts to our customers. We can have long-term customer relations, predictable business coming through these contracts. We have productized offerings that we are efficient at executing in that sense. And we have contract models and revenue models that we have built that benefit both parties, us and our customers in that sense. Of course, what does the customer get out of it? Usually, what we aim to for or go for is the operational efficiencies. That's the key, usually what the customers are aiming for. But then on top of it, they get the improved sustainability. They get lower risks, longer part lives, more resource-efficient operations, fewer shorter shutdowns, meaning more uptime to their plans in that case. Next up, we have actually a good example on what this life cycle services contracts can be. So this is a productized Metso Outotec life cycle service contract for grinding mills in this case. So you can see what is included in it on the left-hand side, but the customer benefits are clear, what the customer has achieved in this case. What they have gained is more than 120% improvement in wear life of these parts. 61% reduction in maintenance hours needed for this particular equipment, 46% less downtime related to their liner replacements. So the customer benefits are obvious in this case. And what we can see then from Metso Outotec's perspective, the contract has been built in a way that we have aligned our incentives together with our customers, creating a win-win scenario. So we win together. We succeed together in this case. And as you can see, it's almost 8 years that we've been running this type of contract. The additional benefits for us in Metso Outotec is that this is predictable business. We know when the demand is arising. That enables us to utilize our supply chain more efficiently. We can use our manufacturing locations, utilize them at the maximum levels because we can then offset the peaks and valleys coming from the erratic demand outside of the contracts in that sense. And the good thing here is that we have that Metso Outotec's installed base of 8,000 plus mills. We can use this to go after that installed base. And actually, this particular concept, we can go after our third-party equipment as well. It's not limited to our own installed base.

Now I think we are approaching the last session of our presentation before the Q&A. A few examples of the commercial excellence and efficiency improvements that we have done in Minerals segment and also looking at the journey, as said towards the 20%. So of course, I think market is volatile, particularly recently with COVID and logistic constraints, material price increases, electrification, energy going more expensive. So we have had to look at what -- how do we mitigate that in our operations. We have decided to split that in 2 areas. One is on the commercial side. And the other one is to secure deliveries because both have been a challenge. And I think it's also good to understand and mention that we have actually 2 quite different type of business portfolios. We have more product delivery -- project delivery type of cases where it's engineered or configured against an order. And then we have pure parts business manufactured to stock and having a price list items. They have slightly different strategies in mitigating the risk but also some similarities. So of course, when it comes to these engineered-to-order or configured-to-order type of things, there we are protected by the, by our suppliers proposal. So we always make sure that the validity of our own offer is at least as long as our suppliers are giving us and very strict on also giving customers shorter proposal times. On a price list items, but also on equipment items, we have worked with frequent price checks and also made increases where we need it. And then very much focusing also on terms and conditions that protect us against this volatility. So price change points, indices and so on in the contract to make sure that we are not the one absorbing a possible cost increase. And it has worked quite well for the time being. I think it's quite robust system that we have put in place. On the other side, we have delivery constraints. And there, of course, the way to mitigate that is to somewhat increase the inventory and put it into places where we know that it will be consumed and needed. We have quite successfully prebooked production slots with our suppliers and agreed that they keep some capacity for us in case we come back with an order and often we do. Regionalization is an important topic because of this increased logistic cost and somewhat uneven cost for actually cost increases in manufacturing. I was last week visiting our new Central Asia market area in Kazakhstan and Uzbekistan like Pekka mentioned, and that's a landlock area. So their logistics have very much been supplied through Russia because of the old Soviet Union structure. And now those channels are basically blocked. So they can get things through Turkey and Iran or they can get things through China. And there, of course, it's important that we, together with our customers, make sure that we can support them in a good way going forward. One option there is, of course, use alternative suppliers so that we find local partners that can help us in certain scopes and then make sure that this rerouting contract and management is done in a good way.

Okay. Efficiency, that we need and that will benefit both us and our customers. We have selected here now 3 areas where we are working for to create more efficiency. Starting by the commercial excellence part. So we need to know our customers. That's the starting point. We are in Minerals segment in direct sales model, which means that there's Metso Outotec people in the frontline selling to the customers and taking care of the needs. So what we then need to have is to correct productized offering, creating the right user experience, customer experience for each of the customers based on what they need. And having that productized will help to create the efficiency. Goes without saying that efficiency is created through standardization. That's the programs that we are running across all the 3 business areas here. And then digitalization will yield the efficiency as well in the commercial side. Seamless cooperation across the organizations. It might be interesting, but we are helping also our customer sites to communicate better between different parts of the organization, and that will also help the seamless cooperation and efficiency created through there and goes without saying that, of course, we all need to be fully aligned that we are doing the same things. And then contract management that Markku was referring to, that's very essential. Contract is a good thing because it helps us and the customer to have the same language. And when they are created with the correct terms and conditions and also utilizing the management excellence in the contracts will help the efficiency that came through for both us and the customers.

Then when we talk about supply chain optimization. So first of all, we want to balance out all the time, our in-house manufacturing versus our external capacity. So we want to max out the utilization, get the maximum benefit of our internal operations and use the external capacity for the peak loads and giving them the excess capacity that we cannot manufacture in-house, in that sense, where we have in-house manufacturing. Production and sourcing regionalization. As we've heard, geopolitics are playing a role and we don't want to have 1 mega factory, 1 source in the globe, so we want to regionalize our production and sourcing more and more and gain benefits out of that. Faster lead times to our customers, better service to our customers in that sense. We want to have optimized logistics network. Logistics is extremely expensive today. So we have plenty of potential to get more out of that one, shorter lead time, shorter delivery routes, reduced costs out of that one. And we want to create predictability and consistency throughout our sales and operation planning that helps us to optimize our supply chain.

And then last but not least, sustainability, quality and safe, also means to improve efficiency. As a company, we have this net zero target by 2030. And as we have learned, of course, we, as a company, need to reduce our energy consumption, consume less water and make sure that we treat our wastes in an efficient way. But I think better gain or more gain we can achieve at our customers by providing them better products as we have done and going to do. Focus very much on recycling. I think consumable example is very great, taking back mill liners and reusing them, of course, focusing on zero defects and zero harm. So as we have told in many, many words, safety is not an area where we want to make compromises. So definitely an area to focus on. So time to wrap up. So how do we continue on our journey towards 20%? We need to make sure that we have the leading offering. And as you have heard already, that's basically responding to customer challenges and making our customers successful. We do that by Planet Positive technologies and digitalization, mostly and making sure that we can help them with the full flowsheet coverage. But of course, also by standardization, productization and investing in the products and product development that creates aftermarket opportunities.

As we self-assessed, the customer success was the area that we can improve the most, out of our top priorities. And that is essential for us to move towards the 20%. Understanding the customers, being able to create the customer value through our own products and offerings and operations is key to success. And then having the captivity through, for example, the life cycle contracts will be key to success in the customer value part.

And on the commercial excellence and efficiency side. So we continue our work on our self-help initiatives that will provide the improvement in our competitiveness and help us to reach our profitability targets in the future. Thank you for listening in on our Minerals presentation.

Thank you.

Thank you, gentlemen, and now it's time for Minerals Q&A. Please raise your hands if you have questions. I think one from the webcast as a starter, Magnus Kruber, UBS asks about Geminex. How are you going to monetize that? And what would kind of the business model around it look like?

That is still partly under development. But as I already mentioned, I think we like to go away from this to additional unit pricing model and be actually sharing the benefits with our customers. So -- and we can do that on an initial phase on process performance. So when they save energy, when they say water, when they need to use less additives in flotation, for example. All that can be monetized and then discussed whether we can be part of that. And of course, then the great opportunities will come from aftermarket and service side, where we can definitely benefit from the information that the system produces.

400 life cycle services contracts already. So definitely, Geminex will play a role as well there going forward.

Good. Joel?

All right. I got a couple. Can I just start by asking on the life cycle services contract again? Could you just maybe put it into context, like what the sort of penetration is versus the group or versus the division and what you think the opportunity could be? I mean, how many could 400 be 5x, 10x bigger? If you could put some bit more detail around that would be helpful.

Yes. So we are targeting that from the aftermarket perspective. We are looking at, currently, it produces like 30% of our revenue in that sense, and we are aiming to surpass 50% in the coming strategy period on it. So significant revenue model for us.

There's maybe one interesting number more. That's 95% and that's the renewal rate of the contracts. So customers do see the value and they want to continue typically expand its scope.

So you'd expect that 400 to accelerate quite significantly?

Yes.

Okay. And then the other thing I wanted to ask was just, I think you've said that with the new equipment the -- did you say that all the new equipment is now characterized as part of the Planet Positive register? Is that right, then?

So what I said is that we -- when we make engineering or design for a new product, we go through the criterias and make sure that we take them into consideration. It may be so that not all are actually -- if it's a minor upgrade of an existing product, maybe it doesn't qualify. But the least, you need to go through the checklist all the time to make sure. If it can be done, we will do it.

And you get superior pricing on Planet Positive products?

Yes, it depends on the product, but I think among those products that we have about 100 or so, so they are definitely the products that have highest margins.

Hi, it's Erkki from Inderes. Could you please provide us a ballpark figure or a range for the price increases made both in equipment and in spares and wears so far this year? And when should we think that this will be -- start to be visible in your sales?

Who wants to start?

If you start from the equipment side first, we'll continue.

Because I think that we are clearly seeing the profitability improving. I think that is clear. How big part of that is coming from price increases? How big part of that is coming from efficiency improvements or the execution excellence, that we have in our projects? I think we have an idea of that, but maybe nothing that we should be sharing. However, what I can say that there is significant improvement in profitability of the CapEx business. And a big part of that, the part of that is definitely pricing.

In the aftermarket, so starting maybe from the spare parts that I know. So now it's the month #9, and there is 6 price increases done 2022. So it's more like reflecting all the time what happens and then pushing the price increases in starting already, actually end of last year. It is visible already when they are inventory-based products and then more visible later when actually implemented for the sales and the lead time comes through.

Yes, that's talking about the aftermarket from the consumables perspective. So there's not 1 number because it is quite a versatile way how we conduct our business. But I can say that the impact is double-digit on the growth side, what it has come from the price increase.

Would this also, the double-digit also go for you 2 guys?

It depends how you define double-digit.

Well, consumables is the most impacted by all the raw material costs and logistics and energy costs. So that's why we can say it's a 2-part number there.

In our case, we also have 1 additional driver, and that was partly discussed in the beginning. That's, of course, the portfolio. So when you position your products of the 2 ranges in a new way you can actually a little bit increase the sales margin of the whole portfolio.

Okay. Have to deal with that.

Tomi Railo, DNB, a follow-up. I think we got a little bit of indication of around 15% price increase in Aggregates presentation. So double digit, I assume it's somewhere close to 15% or should it be higher or lower for the Minerals business?

How do we look at the whole segment, that's difficult? But I would say that the 15% is not a bad number.

Yes. And then maybe just a wider follow-up. How does it actually work? And when you compare yourself on price increases to your competitors and competition out there, do you feel that others are raising in a similar pace? Is someone low -- or making lower price increases, someone higher? How do you follow up? And how do you think you are performing?

Yes, typically, when you are a market leader, so you are also then the price leader, especially when the price increases start and that we did see in the beginning. But interestingly enough, there was so much happening in the volatility of the world that the pushback was not there from the customers. There was like a clear understanding that what's happening. And of course, we did also a good job to explain that what are the reasons behind for these price increases. And then the others have followed up afterwards.

Yes. Definitely, what we see usually happening is that we set the price, we make the first move, and our competitors will follow.

Yes, question on the aftermarket intensity and kind of shared services and you would like to be closer to 70%, where some of your peers are today. So is that doable with your current equipment offering and portfolio or what kind of those M&A actions to strengthen the aftermarket intelligent equipment portfolio needed in that regard?

Yes. I think the M&A, of course, that's one of the strategic targets that we want to with those increase the share. But also, we need to remember that it's not always bad when we are in the good cycle and there's a good amount of capital equipment orders, as I was explaining, that we do enjoy the luxury of getting the new installed base in there that will then help for us going forward. So target being 60% to 70% is like what we are having there, and our current portfolio is having capabilities for offering us that possibility.

Yes. And I wanted to clarify one thing because you mentioned that you want to increase the share of those lifetime agreements. So is that kind of cannibalizing part of the transactional consumable business that is included in those? Or is that kind of on top, which would kind of take you there?

That does happen as well that we take sometimes transactional business, convert that into those contractual businesses. So that's part of it. But we do want to combine that when we deliver new equipment, we would have a life cycle services contract to begin with, with the equipment. Once it's installed, we would secure the business for us for the coming years immediately.

Okay. And then the last question from me is on the consumable business, and that's the most energy-intensive stuff that you do and you have the in-house foundry. So if you look at 5 years down the road, what's your geographical footprint? Is there any changes to in-housing, outsourcing? How should we think about that?

Well, we are constantly evaluating and we have been conducting a footprint review on this one, and we are constantly evaluating what is the best. We want to be closer to our customers. So we potentially will make some moves on that one, but it's under constant evaluation for us.

I'll continue with the energy theme and ask this from Heikki because you are the biggest energy user.

Yes, I consume the energy. Yes.

Of our team. So could you please tell us, asks Magnus Kruber or says Magnus that, how much of your production is in Europe? And how are you kind of trying to mitigate the higher energy bill that we are seeing at the moment?

Well, if we look at -- I have 2 supply chains, so I have metallic and rubber and poly-met and metallic supply chain with the foundries is the energy-intensive supply chain that I have. I have one foundry in Europe in Czech Republic, but that is the smallest of the foundries that we -- I operate today. So in that sense, it's less than 15% or, let's say, 10% to 13% of our production in Europe, what we have in the foundry. And the rubber and poly-met energy is not as big of a deal in that sense, so it doesn't play as big of the part in the cost structure as it does on the metallic parts.

And then mitigation?

Mitigation actions. Well, of course, we offset the price and cost increases that we see there. And we have been all the time investing into new technologies as much as possible. We also want to convert that where the energy prices are extremely high, we convert into products where we do see energy playing a smaller portion on it. So we have more, let's say, bulk products that we can produce where energy is a big portion of it. And then we have more specialized products where energy is less of an issue there. So we use those which are expensive locations to produce those special parts.

Then Klas from Citi has a follow-up on this theme. You have probably introduced or included escalation clauses in your contracts, et cetera. So where we are in that journey in terms of catching up the inflation? Can you kind of describe that journey and your position there right now?

Yes. So contractual business, of course, we have price adjustment clauses, and we've been now strengthening those. So that was what I was referring to as part of the contractual negotiations. So we have been making them more frequent. So in the past, we had longer intervals between the price adjustments. Now we've been renegotiating all of our contracts to have maximum 6 months, usually 3 months' notice or period of price checks and that allows us to conduct our business in a right manner on that one.

And you think the worst is behind you?

Worst is behind us. We have got, we've stabilized a bit more on the -- especially on the raw material side. Logistics has stabilized, energy, Europe is a challenge for us. Rest of the world in terms of energy is not as challenging for us.

All right. Any questions, Panu there in the back?

It's Panu Laitinmäki from Danske Bank. I just wanted to ask about your revenue exposure to different metals or minerals. So if you think that copper is the biggest and then gold and iron ore and so on, how do you expect this to change in the, let's say, next 3 to 5 years? The battery metals probably will increase and iron ore go down or whatever. But does it have any implications on your business and like margins, do they use different kind of equipment in different kind of mine? So how do you see this playing out? And does it help you? Or is it like a drag on the margins? Or any comments on that?

No, I think it's a good question, and this -- they tend to fluctuate a bit year-over-year. But even looking long term, I think gold -- sorry, copper, iron ore and gold has been the biggest ones, in area. Maybe now iron ore is somewhat were down, and that has been replaced by the battery metals, including nickel. So I think the portfolio we have is capable of serving all the markets. But if you look at where, for example, where we have the biggest product range and cover biggest part of the value chain that is in copper. So when the future of the copper looks good, then it typically looks good for Metso Outotec as well. And we have good coverage in lithium and cobalt as well and nickel.

A couple of questions about the offering from the webcast first from Debashis, from Societe Generale. How would you assess your position in the HPGR, high-pressure grinding roll market against competitors and its, let's say, opportunities going forward?

We have a good product, but we cannot claim to be the market leader in that area. So I think we are the upcoming company. We have recently won quite many HRC deals. We have new products introduced continuously and the products that we actually have delivered, they are performing well. So definitely an area where Metso Outotec will be a bigger player.

And then another one, a couple of people have asked about water in mining process, how much of your product -- Planet Positive portfolio contributes to water-related challenges? And then following that, what are your opportunities in environment where regulations around tailings management are getting tougher?

So water, how we see the water, it was briefly touched during the presentation. You can develop processes, which consume less water or no water at all or you can recycle the water you use very efficiently. I think the latter one is more common practicality. Our processes are very water efficient and we have always liked to keep in-house the knowledge to how to purify the water because particularly in flotation, typically, what happens is that harmful particles will accumulate, and they will impact the flotation performance. So if you cannot take them out or clean the water to sufficient degree, then your flotation performance will be less, and we have been doing that quite some time. And I would say that we are well advanced in the area. And then, of course, tailings, the last part of it, we have our filters. We are known about our filter portfolio both for concentrates, but also for tailings and actually, we're working on that.

Question from Max Yates, Morgan Stanley, about Planet Positive product portfolio. How big part of those products are incremental in terms of being brand new and then maybe expanding addressable market, are we talking about just updating kind of old legacy offering, if you will?

No, they, of course, they are all within the same process area that we are typically serving. So mostly talking about concentrator plant environment or hydrometrical plant environment. Exactly what was the first part of the question?

It was how big part of the Planet Positive portfolio would be kind of expanding the offering or going into the expanding addressable market.

It's -- I don't think that I can say that number straight away. I don't have it. Sometimes you make a modification on upgrade and that makes it already Planet Positive. And then you have examples like Concorde, we mentioned, which is a new innovation, new development, and that is 100% new. And I think the rest is somewhere in between.

And in aftermarket services, we do see that they are new expanded market when they are the upgrades to make existing equipment to be more Planet Positive. So it's like a new business in that sense.

All right. Antti?

Yeah. Question on kind of your end-to-end offering and that strategy. If you think about mine investments, there's the client choosing the equipment provider and you don't want to make turnkey, so there's a project housed in between. So what's the benefit of having a wide offering if the project house decides to just pick and choose the best for a certain technology? So you have a wide offering, can you be the best in all of those technologies that you have? Or is it the benefit of having the wide offering enough to compensate?

Both yes and no. If you look at the structure of our equipment sales, big part -- and I think you are on the right track. So big part is going to EPCs somewhat, it varies again from year-to-year, but it's more than half of the equipment sales goes to EPC houses, and they typically, they typically buy equipment, not necessarily the whole flowsheet from 1 supplier. However, customers are starting to demand of these things. So the EPC companies will have to accommodate whatever customer requirements are coming on this area. So I think gradually, even that part will go. Then the other significant part of our business, again, varying a bit from year-to-year between let's say, 20% to 35% is where we actually deliver the full flowsheet for a customer and then it's fully up to our -- to deliver a Planet Positive flowsheet and make sure that the customer get full benefit out of it. And then the balance -- remaining balance is pure equipment sales directly to customers without having any EPC in between. So we can do it in all areas.

And I'd assume there's no exclusivity with the EPC houses that -- I mean, I'm just wondering why do you kind of win business? Is it your aftermarket capabilities? Is it your technologies? What's usually kind of turning the direction to you?

Of course, it varies from case by case, but we have a very strong and competitive product range to start with. And then the other thing is also that how we involve the end clients in decision making. They quite often have an opinion on what kind of process they would like to have, who would be the technology supplier, maybe not everything coming from 1 company, but we are quite often selected for a big part of that process. And I'm sure that one dimension in that is our good and -- well, good coverage on aftermarket.

Okay. And last one for me. permitting, I think this is something that you've been talking about that the permit times have been prolonged quite a lot. So from your perspective, what's the biggest pain point for your mining clients and where you can help the most regarding just getting those times shorter?

I don't know how much we can help in permitting, again, by providing them with technologies that are easier to get licensed for or approval for, but then we can help them in implementation time when it's time and there we come back to this modelized container rest products where, once there is a go ahead, we can actually help them to construct the plant in a very quick way.

Yes, this is Tom from Carnegie. I wonder about pumps first of all, when you presented the merger, there was a big hope that you could increase your market shares a lot in pumps, but I've not really heard any update, what's -- what has happened?

That was part of the big flowsheet that I think we have, over the couple of last years, it started already before the merger. But over the last couple of years, we have actually raised ourselves from being #4 to being #2. Of course, we still have a significant way to catch the #1, but we are working on it and pumps is definitely one of the areas where we like to have significant growth.

And then you put out a lot of kind of positives that now the margin will improve a lot in all the parts. But do you see any kind of negatives that will hold back the positive development you are painting?

Well, looking at it from the aftermarket perspective, at the moment, our customers are running the equipment quite heavily, so we don't see a big dark skies in the aftermarket side. The customers will continue the demand of metals out there. I think it's more about is there any kind of a downturn on the equipment kind of demand that is -- so and the aftermarket demand is definitely out there.

Yes. On the equipment, we don't see -- and of course, I think you all are experienced in this segment and know that this is a quite volatile industry. So sometimes it's almost like stop and go like 2008 or 2014 and so on, but we have a lot of brownfield in our proposal portfolio. Nothing indicates that the market would be disappearing. Of course, the one disclaimer always is that when and if things happen, the first thing is not that you see are number of proposals or the value going down. It's just that the decision time becomes longer and longer and longer. But as I said, still the outlook, both on short term, but particularly on long term is good.

So this 20% should be seen as a kind of over the cycle rather than peak ambition?

Of course, reaching 20% in a market downturn is more challenging than reaching it in the normal conditions.

And then the margin is not really where you want it to be still. So you have done some smaller bolt-on acquisitions, but it's still perhaps not time to do something larger. But what -- when you do something larger, when that time comes -- where -- what direction would you go in that flowsheet picture? I mean what can you -- where do you find products where you don't have already 2 high market shares where the service content is very high.

There are areas that we like to do. And I think we discussed those through already where -- which typically we will be looking products with significant aftermarket opportunity. And I think we touched base on those in our presentations. So you mentioned pumps, I think, not a bad area to look into and continue to grow. There are other areas as well where we see that we still have land to conquer.

And then perhaps just, I mean, especially you, Markku have been very long in the mining business. I don't know how long you have, your other guys have been. But you have seen many cycles. I mean, it's just interesting to hear your and, of course, also Pekka's, he has been also long time in the industry. So what -- now metal prices are coming down from a very high level. But what should we, what is kind of the normal kind of thing happening, because now we have not had a greenfield cycle? So what has happened in other kind of cycles when metal prices come down to smaller brownfields as that kind of the braking being kind of less severe in brownfields and so on. Can you open up a bit what you have seen in earlier cycles also?

I think what, mining is a cyclical business. And if you look at -- I think my experience goes back to before 2004 where -- or 2003 where the mega cycle started. So before that, there was quite a long flat period. And then started basically 8-year-long mega cycle, which in between, we had Lehman Brothers 2008, maybe had a half year, 9 months impact, and then it continued to go up. And then when it turned down 2013, we thought that the market will never be this big again. And now we have passed that level already a long time ago. So I think it's -- the industry needs orders. The society needs more metals. The deposits are getting weaker and weaker and more complicated to excavate and process, so definitely, I see that this industry need to invest even more to be able to supply the world with the metals that is required. And then in between, there will always be surprises. So I think also a lot of psychology plays in shorter term.

But has -- if you take, for instance, the Lehman crisis, did it, is to understand that everybody stopped all greenfield projects, et cetera, with very long payback times. But it's a very different kind of situation now when the business is coming from brownfield invents, with shorter payback time. What happened to -- ho severely was the breaking in those types of businesses because we only saw the headline figures kind of coming down harshly, of course, but I realize a lot of that came from greenfields.

I think we -- on the equipment investment side, we live very much on the backlog. And of course, even if you momentarily have less orders, the backlog will continue to generate revenue. So you have a buffer. And actually, you also have time to react. And on the aftermarket side, it's very much on how much the assets are utilized. So as long as they are running the asset, producing metals, the aftermarket will have good market.

Thank you. Time flies when you have fun, and we're getting close to 5:00 p.m., so we need to end this session. But before we go, thanks, gentlemen, for your presentation. Before we go, I'll ask President and CEO, Pekka Vauramo, to make his final remarks.

Thank you.

Okay, a long day coming to an end. Hopefully, the program has been interesting. I will use the next 45 minutes to conclude this session very shortly and briefly, but I have only one message. We remain committed to delivering that 15%. I mean it's clear this team has actions in place. Everyone knows what we need to do, and we're not changing that, that target. Once we touch target, we are not afraid of raising the bar higher. We'll definitely do that one. Earlier -- or the first question that was, I mean it was hinting that I may have 15 months to go. My personal ambition is to deliver that 15 before I go, but that's my personal ambition to do so. I may wish a little bit more normality from a Santa Claus this Christmas. I may need that one. But quite frankly, we haven't seen a normality since the merger. We've been through -- we've all been through very different times that we couldn't expect, didn't expect, but good companies deliver also during those days. So it's not an excuse that would be applicable to overall. But we'll keep you posted and updated next review point on our journey towards 15 will be on October 28, when we publish our third quarter results. And until then, all the best, and thanks for joining this day and safe journey back homes wherever you came from. Thank you.