Nexam Chemical Holding AB (publ) (NEXAM) Earnings Call Transcript & Summary

Welcome to this year-end presentation with cleantech company, Nexam Chemical Holding. To present, I'm pleased to welcome CEO, Ronnie Tornqvist; and CFO, Marcus Nyberg. After the presentation, there will be a Q&A with equity analysts and viewers can ask their questions in the live chat. So with that, Ronnie, please go ahead with your presentation.

Thank you, Mattias. Thank you for having us, and thank you for watching our presentation of the fourth quarter at Nexam Chemical. I will do this presentation shared together with Marcus Nyberg, our CFO. In summary, you can say that we have made substantial progress in the company and continue to build on our resilience, although we have a challenging market right now. Nexam Chemical is about making plastics better and more sustainable, working with additives, and we have a significant ongoing investment in R&D and a lot of patented solutions for the future. So to give introduction for the new viewers about the company, we provide innovative additives to the plastics market to meet increasing challenges. And based on the same chemical and technical concepts, our additives land in very wide market segments, anything from lightweighting and miniaturization, working with small chips up to providing solutions for airplane engines and other big structures. We also work very much in the area of renewable energy, in particular wind energy, and increasingly in the area of waste and recycling and both of those are driven by strong global megatrends. We have segmented our business areas into the effect that we provide to our customers in order to improve their business models. So it's divided into 4 areas. One is lightweighting, where we provide additives that makes it possible to produce structural foams from plastics, lightweight construction materials. We have an area called high temperature where we can increase the temperature resistance of the most temperature-resistant polymer materials there are in the world. We have one area, aesthetics, which is -- acts towards improving the looks of plastics, providing the right color, providing durability of those colors and of the plastic itself so that it suits the application. And then we have our growing area where we put a lot of energy and effort right now is to improve recycled plastic materials and take them from being a low-quality product to be able to make more advanced products with recycled materials through our additives. I will go a little bit deeper into the recycling area because it is an area which is quite hot right now. It is a very strongly growing part of the plastic industry and it's very relevant to creating a more sustainable world. So what we have is a portfolio of tailored additives that suit a broad range of applications. In every case, when we manage to create a deal together with our customers, in this area, it is always based on a sound business case for ourselves and for our customers. And what it does is really adding a small percentage of an additive into a plastic recycled stream and thereby increasing what we can do with it, the application level, so to say. It can also be used to upgrade the poorest qualities of recycled materials into something usable. Today, the plastic consumption in the world is about 400 million tonnes and roughly just below 10% of those are recycled. If you look further, another 5 to 10 years, it's predicted that the plastic consumption in the world will increase quite drastically. But there are initiatives and, let's say, regulations and so on in many regions, not only here in Europe, also to a great deal in, for example, most Asian countries and many other countries to increase the portion of recycling. And we contribute to the ability to really use those recycled materials. Just to put a point on the value proposition that we bring to our customers, it is often driven by economical reasoning. A very good recycled material, for example, recycled PET from drinking bottles can be used in many different applications. But this is an example where they use it for other food packaging material. They need to use 80% of an expensive high-grade material, 10% of lower-grade recycled material at lower cost and about 10% of virgin material. And by the addition of a little bit, maybe 1% or 2% of an additive from Nexam, they can reduce the amount of the expensive material to maybe 30% and use much more of the lower cost materials. So in this calculation example for food packaging, you can reduce the raw material cost with 30%. On the materials put inside, you add 6% because our additive costs something, but the resulting total cost saving of the product is 25%. This is a typical example for all customers, I would say, within the area of recycling. So always there is a sustainability aspect to it, definitely, but there is also an economic aspect to it. When plastics materials are degraded, they are -- the molecules are shortened. In order to regain that -- the properties of a new material, you need to lengthen the molecules again. And this is the kind of core scientific idea behind our additives. This has been scientifically validated by the University of Turin in Italy, where they have simulated multiple recycling processes by several recycling operations; in this case it was 9. And you see that the numbers go down with the increasing number of recycling steps. And this is a data, so to say, to show that the material becomes weaker and weaker and more and more degraded with more recycling steps. So you would say that maybe a maximum of 5 recycling loops can be allowed or something like this. However, with our additives, you see here the degradation increasing, you get shorter polymer chains. With our additives, we can bring it back. We, so to say, glue the molecules back together in the recycling process. So -- but if you introduce this in the 9th recycling loop, you get back to the same kind of material that you had after only 4 recycling loops. And if you would do this earlier, for example, in the 4th loop, then you would come close to how the material was from the beginning. So that's the basic function of our additives in the recycling scene. If we look at the world around us, we have this 400 million tonnes of plastics. It's slightly increasing year-by-year. About 35 million tonnes are mechanically recycled and 2 tonnes are based on chemical recycling, more advanced and expensive way of doing recycling, and that is also shared with bio-based plastic materials. So it's small, but it's about 10%. We focus on the area of mechanical recycling because we believe that this will be the volume driver to manage this challenge in the world because of the cost situation. You also see here a split of the various materials, polypropylene, PPE, LDPE. So polypropylene is used, for example, in ice cream boxes or car components. LDPE is a typical plastic bag material. HDPP is also rigid packaging, you could say, PET drinking bottles is the biggest market there, PVC, et cetera. Our reactive recycling technology covers more than 50% of the plastic volumes. We are specialized in the polypropylenes and polyethylenes and the PETs and some other, you could call other thermoplastic materials where we're also active, but this is the main drivers. So the patents that we have and the technologies that we sit on are applicable to the majority of the plastics out there. So that is a little bit of our position in that field. Coming back now to how business is going right now financially. In the quarter 4, we had sales that were slightly lower than the quarter before. We had the same challenge that we had in quarter 3 that a few of our customers in the specific field of PET-foam had a very difficult market. And this led to quite a substantial reduction of the sales into that segment. But on the other hand, we have been quite successful in business development. So we were able to cover for almost all of that loss. The gross margin continues to increase. We had now 47%. A year ago, we were at 44%. Marcus will come back to that figure a little bit. The EBITDA, which is a cash flow indicator, was SEK 2 million and SEK 1.6 million at a higher turnover a year ago. So our ability to create earnings and cash flow from what we do has increased. The cash flow in the quarter was -- the total cash flow in the quarter was a little bit on the negative side. It was minus SEK 5.5 million, minus SEK 7.6 million a year ago. And this was really a temporary effect. It's already gone now due to late incoming key raw materials that pushed deliveries to late in the quarter. Hence, the invoices weren't due at the change of the year. The financial stability that we have achieved is quite remarkable. It's -- we are -- we fund everything we do, technical development, business development and the daily operations with our own cash flow. And we had at the end of the quarter SEK 20 million of an unused credit facility. It has now been increased to SEK 25 million and is still unutilized. So we have a very good financial stability. And just a reflection on this, when we had Board meetings a year ago, we talked for 1 hour about the cash flow situation. We had a Board meeting yesterday. We talked for a few minutes about the cash flow situation because it is so much more stable now. And all our energy goes into business development and increasing sales. So over the year, we had a slight growth of approximately SEK 200 million sales compared to SEK 190 million last year and the EBITDA increased to SEK 8.1 million compared to minus SEK 5.9 million the year before. So we are increasing our, let's say, performance in terms of earnings generation at similar sales. We also have a lot of market activities, business development activity. One example is that we are now really trying hard to conquer the Central European markets where Nexam have historically been quite weak with a business development manager based in Germany. We have had in the quarter, the first real full industrial scale orders in reactive recycling additives for a really big major customer. So we're moving in from, let's say, a lot of small different customers in recycling into bigger scenarios. We've also been -- received a decision to grant a patent for reactive recycling for polypropylene, which is about 20% of the plastics market. And we have also received in other areas, structural composites where we're also active. We've spent 1.5 years of R&D and testing and so on with a very big customer that can become one of our biggest and it's finally into full-scale production orders now. And many such, you can say, business development activities going forward. I want to say, in quarter 4, the one thing I'm most happy with is that we have a very strong pipeline and loads of activity in the business development area. We have many -- a lot of customer interest, especially within recycling, but also within all other areas really. And then we increased this credit facility through the Swedish Export Credit Agency, which was a little bit of a long process, but now it's done. So with that, I would like to leave the word to Marcus to dive a bit deeper into the financials.

Thank you, Ronnie. I will give you some more details about the financial performance during the fourth quarter. As Ronnie mentioned, we ended up with SEK 48.6 million in sales, a little bit lower than a year ago, but we had a better margin. And we continue really to focus on our cost control. We ended up with an EBITDA of SEK 2 million. We have -- the cash flow during the quarter was minus SEK 5.5 million. And as Ronnie mentioned, that is due to that we had lots of raw material coming in a little bit later than expected, then we had to pay it before year-end, we convert it and we sell it to the customers. So they haven't paid us on at year-end. You can actually see it in the balance sheet. If you look at the accounts receivable, you can see it actually has increased compared to last year. And for accounts payable, you have the opposite. That actually have decreased. So that's a temporary thing. And as Ronnie mentioned, we also got this additional credit facility from EKN. And for us, it's really good that we can see that our banks and so are really supporting us and really believe in our business and our business case. So -- and then let's move on. And here, we have actually the figures coming from the cash flow. You can see the net cash flow has really improved compared to '22 and '23 and also our operating cash flow. So we are really on the right track here when it comes to our cash flow and that we also can generate cash flow within the current business. And then we go into the margin. And now we actually have improved the margin for 2 years, actually up to 8 quarters. And we now have 47.4%, if I remember correctly. And that's on a quite stable level, to be honest. We -- now it will depend a little bit on the customer mix and the product mix. But we think that is a long-term margin that we can have. And then I'm handing back to Ronnie again. So please go ahead.

Thank you, Marcus. One comment on this one, a reflection from my side is that it is -- we do not do any shortcuts when we do our cost savings and cash flow improvements. The maintenance level in the company is higher than ever. We really do what needs to be done and we don't push cost into the future. I think that's also a point that is worth mentioning when you see an improved cash flow like this. Another thing that has happened over the last 2 years is that we have through, you can say, business development and broader customer base created much more resilience in the specific area of lightweighting, for example, which was quite huge in 2022 because that business boomed, back then we had very few customers. And today, we still provide those customers with the same type of products, but we've added a lot more customers in the segment and we are less dependent on 1 or 2 customers. And this goes for really every area of our business. But you also see that there is a drop. So we have increased, you could say, the number of solutions and the number of customers and we still maintain the old business, but still yet the sales are lower in the area of lightweighting. And that's something we cannot really -- it's out of our control how much the market demand is out there. What is within our control, though, is which customers we work with, which type of products we offer and there we are really on the edge. And that is true for all areas. And in -- but what we also see is that there is a huge stability in the high-temperature segment. It does not change from quarter-to-quarter. It's very, very stable. And the Masterbatch Nordics and Eastern Europe, the aesthetics segment is also quite stable and it consists of many, many, many customers. And we are very dynamic in the development there. It's tough competition, but we manage well. To mention on the recycling activity, we have tracked the number of customers that we sell to. So this includes recurring high-volume customers and it includes also, you can say, industrialization stage customers that do not yet -- are not yet in the full production. And what is striking here is that we have about approximately the same number of lightweighting customers and high-performance customers that we work with. But in recycling, it's booming. We've gone from 30 paying customers to 60 paying customers and many of those are in the early stages of development. It still means that we are quite, let's say, dynamic and innovative also in the high-performance and lightweight segments. But in recycling segment, we see a strongly increasing interest. We've shown this before, but it's the funnel that describes how our projects go from a customer interest to executing commercial sales and production scenario. It starts with the customer interest at the early stage, goes into evaluation where they test our product in their product, goes into a development stage. They might have changed something or we might need to change something on the product in order to be successful and then goes into a proof of concept, including practical and economical evaluations and then it goes into a scale-up phase, a launch phase and commercial phase. And the timeline for this is very dependent on the type of project we have. It can be anything from, let's say, 2 weeks in an exceptional case, but more commonly, 1 year or 2 years that we have to go through this and it can be longer than that too. What we want to show with this is that we have on commercial scale and running production in recycling, for example, we have 8 customers more or less. And in -- or new customers that have come in. This is new customers that we list here. So we have 8 new customers that have come in recently and a couple in high-temperature and a couple in lightweight. But we also have a very full pipeline in the earlier stages, and that's reflected in the previous slide where we have 60 paying customers in recycling, for example. That means when they start to pay for samples, they are past the development stage then it's approaching proof of concept and scale-up phases. So we have a very strong pipeline of things coming in and this goes for really all our business areas. But in these projects, you have -- it's not a smooth ride. You always have difficulties, setbacks, challenges and so on. And that's the reason why it takes a fairly long time. And that's also the reason why it's a little bit unpredictable when certain businesses will actually start. And in turn, it makes it difficult for us to give precise volume predictions for coming quarters, for example. Another interesting part of us is that we have a good scalability situation. We have reduced our breakeven for EBITDA level. It's gone from about SEK 55 million to SEK 45 million per quarter, which is then shown by, for example, this quarter where we have SEK 2 million in EBITDA on the sales level of SEK 48.6 million due to our savings program, in-sourcing and other activities. And beyond the breakeven point as it is right now, the top-line increases contributes to approximately 35% on the bottom-line. And the team has proven over the last year that we do have the ability to really develop new business and convert the various leads and customer interest into real business and we have a stable base. 90% of the sales are recurring production volume. So as we increase the amount of customers, we also increase the amount of recurring sales. And an interesting aspect of this is that there were a lot of investments made in Nexam a few years back in machinery, but also in, let's say, production supporting systems and so on, which has put us in a situation where we could actually double the sales without overloading the system. So we do not really need to do further investments until we are at a much higher sales level. And it can be worth to mention that we don't give a sales number prognosis, but we have a very granular program in place driven by the whole management team and all employees where we aim at reaching SEK 300 million sales instead of SEK 200 million sales. So we have a very strong program there and we do everything we can every day to achieve it. The contribution margin that Marcus showed is expected to remain at least at this level in the coming quarters. So as we develop the new business, we land in a similar field of contribution margin where we are right now, which is then in the range of 45% to 50%. Another aspect of Nexam is that we have our 4 areas. You could say, they can be divided into 3 different business logics. One is aesthetics, colors and durability of polymers. It's a base business. It's growing. We are successful there, but it's more of a traditional industrial activity. And then the high-temperature and lightweight segments, we are extremely unique and we sell over the world and it's kind of a growth engine. We are quite successful in those projects and it's going forward. So that's another type of behavior, you could say, on the market. And then we have 4% of the sales, which are in recycling that basically started for almost 0 a couple of years ago and is now catching on. And this is more of a scale-up kind of company. It was a start-up and now it's becoming a scale-up. So this has enormous potential to grow fantastically and that's why we believe and put so much effort and energy into it. And we think that we are right in time with the industrial infrastructure improving in the recycling scene and the, let's say, pressure from society, consumers and so on to increase here. So that has a totally different kind of logic to it. So summarizing the position we're in. We're in the middle of a quite good turnaround with much more stable financials. We're looking forward for 2025 that we believe will be a good year for us. We're returning to growth, we're increasing profitability and we have a broader customer base. The cost saving programs that we have behind us has given us a financial strength to handle also 4 quarters, if they should come. We have a very focused commercial strategy, which is not only the salespeople, it is also marinated throughout the organization. It goes also for operations and in particular for R&D, which is supporting this. We're expanding our position all the time in the specialties of lightweighting or PET-foam and in the high-temperature segments, although high-temperature is a slower moving market. And we have major breakthroughs now in recycle with multiple customers transitioning from testing to industrial production. One of the paying customers of the 60 just now last week put in a first production order of a few tonnes of the additive that is then used for a few hundred tonnes of recycled materials. And if this proof of concept goes into production, it can become one of our biggest customers as well. So we are all the time working on this type of developments. But as I said before, it's difficult to predict exactly when they will land in sales. We have an increased market presence also both in Central Europe and also within the area of recycling. So we believe that 2025 will be a really good year. And then why should one buy shares in Nexam? Because we have a very high ambition and high plans for 2025 and beyond regarding all financial KPIs, improving our earnings and growth. We can fund everything we do with our own cash flow and we have an unutilized credit facility should something happen. We have 8 consecutive quarters of improving margins and we expect to be able to remain at that level at least in the coming quarters. Maybe we can grow a little bit more, that's the ambition. We have a lot of patented solutions. So we're in a stable market position, you could say, especially within the areas that are driven by sustainability megatrends. And it's based -- it's not only based on the business that we do, it's not only based on, let's say, improving the world, which is a big base for it, but also, in every case, a solid business case for our customers. We've done a great deal of investments and we can sell much more without investing. And we have an experienced management team, like Marcus and I both come from bigger organizations and most of the team in the management are -- have a similar background. And we have a track record of driving growth and we're used to handling this situation. And the business model is also interested because there are things we could do more with future investments and potentially also acquisitions. But -- and then we have this little company within the company in recycling that is on par with really highly valued start-up companies. So we -- that's the reason why I have invested a lot in Nexam and Marcus and all our colleagues in the leadership team of the company and the Board of Directors. So we hope to get more owners. With this, I would like to conclude the presentation. We work with the future of plastics, trying to make the world better, and we have patents to cover our market position. So with that, thank you so much for listening. And we'll listen to the questions and answers from analysts and the audience. Thank you.

Thank you, Ronnie and Marcus. And before I let the equity analysts in, I ask, like you stated twice, you grew your gross margin for the 8th consecutive quarter. How far can you go here?

It will depend a lot on -- for every single quarter, it depends, of course, on the product mix and the -- how well we manage to control our costs, of course, but it's very product mix dependent. So we cannot promise that it will continue to grow and grow and grow for every quarter because -- but we believe that long-term, we'll be able to keep this level where we are right now.

And with that, it's time to let in equity analyst, Henric Hintze of ABG Sundal Collier.

So first, I'd just like to follow-up on this large customer with lower deliveries, which you mentioned already in Q3 and seems to have persisted into Q4 now. Could you just describe what the development there has been during the whole year? Has it gotten worse or been stable throughout the year? And how long do you think this situation will persist from here?

I'll let you start, Marcus, and I'll fill.

Yes. Coming back to that one, the second half of the year was worse than the first half. And to be honest, looking forward, we don't really know. Our customers don't really give us any forecast or any forecast that we really can believe in. So there is an uncertainty when it comes to the lightweight market, short-term at least. But we can see that orders are actually coming. So we -- it is a bit tricky to predict within the coming 3 to 6 months, to be honest.

What we see is a weakness that seems to be quite long-term in the European and North American markets, but there is still strength and dynamics in the Asian markets, in particular, India and China. And we -- our customers work a lot on application development and broadening the use of these kind of structural foam products into other applications than just wind power and they are quite successful doing so and that compensates to a bit, but the wind power part of the business is quite high. So it depends a lot on what happens out there on the market, how rapid this will go. So what we do, we work with things that we can affect. We cannot affect whether China or U.S.A. or Europe are building wind power mills, but we can improve our position, help our customers to make more cost-efficient recipes and help our customers to make technically better materials. And we can, so to say, come with product innovation to support their business and that's what we are aiming for, the things that we can affect.

All right. So secondly, you showed us the slide with the business case for reactive recycling and it seems very financially favorable for customers. So what are some of the main challenges in getting customers to adopt your solution here?

Okay. First of all, they need to understand the business case and they need to successfully perform it in their products. And they have a customer in their turn and they also need to accept that. And there might be more challenged than one, technical challenge, so to say, with these materials. So they also need to find the right specifications of materials and so on. And the pricing on the recycling market is very volatile. So sometimes the business case during an evaluation stage might look very different half a year or 1 year later when it's going into production, which might accelerate the process or slow down the process depending on how that looks. So it's a dynamic situation, you could say, that we need to follow. And it's both technical and commercial challenges in all of those projects.

All right. Very good. So on the slide with your development project pipeline, there was a very high number of recycling projects compared to the other segments. I'm just wondering, does the revenue potential per project differ significantly between the segments? And then I mean recycling and high-temp and lightweighting.

Yes. So you could say that the large customer projects are fairly similar between those 3 segments; high-temperature, lightweighting and recycling. So they can -- in any of those segments, if we are successful, a new customer that we work with can become one of our top 3 customers. But there is many more recycling initiatives on a smaller scale also. So we need to have a higher number of customers in recycling in total to have the same income as if you compare to, for example, high-temperature and lightweighting.

Okay. Very good. And then just finally, how do you feel going into 2025 compared to how you felt a year ago when 2024 was just starting?

Yes. We've been speaking for a while, Henric. I'm quite positive in terms of outlook towards the future. I felt positive in front of '24, we were right in the middle of a savings program that we then could see that this is actually going to work. We will have a stable organization and something that will function. And now I'm more optimistic because now we have done all that. So it's behind us and we can really focus on business development. And I'm quite happy that some of it is trickling down now into production orders and so on, the press releases we've made and so on. But I'm especially happy that we have a very thick pipeline behind that in the evaluation stages going behind. So I'm really positive for 2025. But on the side of what we cannot affect, how the markets will look like, the general markets and so on, that's more difficult, of course, to answer. That can have a positive or negative effect on us how it develops in the global industrial markets.

And if we move on, turnover increases as does cash flow EBITDA, but cash and cash equivalent decrease. What are the reasons behind this?

Technicality...

Yes. Let's see if I can -- there are 2 things mainly during the fourth quarter. We had lots of raw materials coming in pretty late, meaning that we need to pay for it before year-end, but we didn't get paid more customers until now actually in January. And then we also have this December effect that the bigger customers, they don't really pay after mid-December even if the invoices are due. So that's roughly SEK 5 million actually. That was just pushed to week 1 or week 2. So December, it is a bit seasonal when it comes to that, to be honest.

Okay. And you mentioned in the report that a big customer buys less. Could you tell us which one and why? Is it temporary or...

Yes. I think I don't want to speak about single customers and their situation, they need to do that themselves, but it's related to the weakness in the field of lightweighting segment.

And what does your goals look like in 2025 regarding turnover, cash flow and profit?

Like this. We can say that contribution margin-wise, we want to be at least as good as the current run rate. We have the SEK 300 million program that we are working on intensively with the determined success factors that we need to achieve. So we will work on those. But we cannot seriously predict when -- how much will happen and what the, let's say, global economy effects will be. So it would be too daring to give a prediction of quarterly sales for the whole year of '25 already now. But we work on the factors that we can affect. So that I can promise we will do. And the earnings, it's like we say in the presentation, we don't foresee any high investments or anything like that. So cash-wise, we will be stable also this year. And we will continue to develop. And if we are then successful and sell more, then 35% of that will drop to the bottom-line.

Yes. And you previously said that you expect to breakeven at EBIT level in Q4. How far is that away from us now?

I like this. I don't remember saying that, but maybe ambition is not bad to have. On EBITDA, we are quite positive. On EBIT, we are still negative. We need SEK 4 million per quarter EBITDA to have 0 on an EBIT level. And that means sales of about estimated SEK 55 million, SEK 58 million, Marcus, something like that?

Something pretty close to SEK 60 million.

Close before SEK 60 million. And we're trying to get there as quick as we can.

Yes. You have pointed out several quarters in a row that the signals from customers are that the wind market is recovering. When do you think we can see that in Nexam's sales numbers?

I frankly don't have the visibility exactly on that. It seems that the delay between order intake for the windmill producers to the delivery date of additives has changed. It is not following the same logic it did a couple of years ago, probably because of maybe a regional shift towards -- more towards Asia and they maybe have different lead times or the mix between sea-based and land-based wind power. So I cannot really say, unfortunately, and we don't get that visibility through our customers, unfortunately. But over long-term, it ought to come back indeed.

You recently announced that the Czech credit has been increased from SEK 20 million to SEK 25 million. Is it because that you already reached the ceiling of the existing credit?

No, we're actually not using it. This was more like for us to go and see how our bank and how much they really believe in us. And they said they really trust us. They trust our business case. They can see that we can make some earnings. And when we look -- and of course, we are presenting them with our future plan and their future growth plans. And then they said they're really interesting to support us with an additional SEK 5 million. So we actually had SEK 25 million that we can use any day that we're not using today. So -- but unfortunately, we can't show SEK 28 million. We have to show SEK 3 million, but that's the question for the auditors. Otherwise, it would be SEK 28 million.

But also a big reason for the EKN to support us in this case is that we are conducting a lot of international business development, and that's the purpose of their activity, of course. So we're grateful for it.

Yes. You also stated in the report that the EU's packaging and packing waste regulation is a game changer for the plastic and packaging industry. Can you describe what it actually means?

Yes. Okay. So right now, it means that it becomes forbidden to make packages that are not recyclable, but it doesn't state any required use of recycled material yet. It is for 2030. So we see that some -- where there will be minimum limitations on recycled material in various packaging materials. And what we see is that foresighted companies with big resources are already today using it to start to increase the use of recycled material because the customer wants it or because they see that they need to be prepared in time. So we're seeing an increasing activity a little bit everywhere in the industry and some haven't started to react yet because 2030 is some time to go. But it is necessary to start to prepare now because there are a lot of challenges on the road. And we have several initiatives where we are working together with customers on how to fix this in 2030. So we think that's an excellent business opportunity for us in the coming years also before 2030.

Okay. And that will conclude today's broadcast. Thank you for the presentation and all your answers.

Thank you, Mattias, for hosting us. And thank you for watching and see us again in approximately 3 months.