Norconsult ASA (NORCO) Earnings Call Transcript & Summary

Good morning, everyone, and welcome to Norconsult's Fourth Quarter Presentation for 2024. My name is Egil Hogna, I'm the CEO, and today's presentation will be by our CFO, Dag Fladby, and myself. Please enter questions in the chat if you are watching this as a webcast, and we will have the questions and answer at the end of the presentation. I'm happy to be able to announce another strong quarter for Norconsult with steady growth and improved underlying profitability. We start with the front page showing one of our Norconsult award winners, which is Tollboden in Trondheim. It's a rehabilitation project, which was fairly complex, but with a very nice result in terms of a finished project. For those of you who are new to Norconsult, I'd like to give you a quick reminder of who we are. We are one of the leading Nordic design and engineering companies, the market leader in Norway, and we have 6 reporting segments, the Norwegian head office, the regions, Sweden, Denmark, renewable energy; and finally, Digital and Technogarden. A bit more than half of our revenues are from the public sector, and we have 3 main markets: buildings and architecture, infrastructure and finally, Energy and Industry, roughly 1/3 each. We have 6,500 employees spread around 140 offices, and we have a financial history of steady growth and steady profitability, and that includes the last year as well. In the fourth quarter, we showed stable growth and a slightly improved underlying profitability. Our net revenues increased to approximately NOK 2.5 billion, and we showed 7% organic growth adjusted for a small calendar effect. In terms of our bottom line, the adjusted EBITA increased from NOK 209 million to NOK 227 million, giving an EBITA margin of 9.1%. When adjusting for the fact that there was a slightly lower or less working time in the fourth quarter this year, the calendar effect adjusting for that gives us an EBITA margin of 9.7%. In the quarter, we had a strong cash flow from operations of NOK 938 million, which is a substantial increase from the same quarter last year. And finally, the Board of Directors proposed to the general assembly a dividend of NOK 1.70 per share. The picture shows one of our large projects. This is a project called Rogfast, which will become the world's longest underwater road tunnel, 27 kilometers long, dual tunnel, and it will be 390 meters below sea level at the deepest level, showing our engineering expertise. In terms of people and organization, we ended the year with approximately 6,500 employees. That's up from 6,300 1 year ago. Our sick leave decreased slightly from 4.7% to 4.5%, while we saw a slight increase in the employee turnover. In November, we distributed 13 million shares to employees as part of the gift shares in connection with the IPO 1.5 year ago. The slight increase in employee turnover, we think is probably related to the fact that the lockup period relating to those shares ended in November last year. Still, our turnover is lower than our peers are having in the Nordic sector. We also had 2 new members of the corporate management team in the company. Hakon Bergsodden was appointed new EVP for Renewable Energy from the 1st of February this year. And as our Head of the Danish operations have resigned the former Head of Nordic Denmark, which has shown some remarkable results. Jess Sorensen has been appointed Interim EVP from the 1st of May this year. We also received for the first -- sorry, for the third consecutive year, Gazelle Award in Denmark for both remarkable growth and profitability, while Norconsult Sweden again was nominated a career company, demonstrating its -- demonstrating our attractiveness to students and young professionals. In connection with our 1-year anniversary on the stock exchange, we have made a short video where some of our colleagues are explaining why they work for Norconsult. [Presentation] And as you can see at the end of this video, one of our colleagues mentioned the fact that in Norconsult, virtually everyone are also shareholders of the company, something which we think contributes to a unique culture and alignment with shareholder interests. In the fourth quarter, we announced our acquisition of Swedish company, Sigma Civil. In February this year, the company -- the acquisition was completed and the employees integrated. In total, it's 4 offices and 125 employees who will be integrated in our existing office structure in Sweden. Sigma Civil has specialized in infrastructure, environment, project management and construction and will nicely complement our existing activities in Sweden. This acquisition is very much in line with our growth strategy to increase our local presence and skill base in the Nordic region. When it comes to the market, it has been fairly stable in the fourth quarter of last year. In Buildings & Architecture, we continue to see a somewhat weak private market, but there are signs of optimism. And for this quarter, I would like to highlight both Sweden and Denmark, where we have seen a number of positive developments. The public market is very much stable, and we see a growing demand relating to defense-related projects. Infrastructure has also been very much stable, both transportation and water infrastructure activities are based on public investment plans, which are running at a steady pace. And there is more spending when it comes to rehabilitation and upgrading compared to previously. We see a somewhat smaller number of very large projects being initiated in the market, but the total number of projects is increasing, meaning that there is a higher number of smaller to medium-sized projects. Energy is still the market area where we see the strongest demand. This is linked to electrification and the strong demand for, in particular, renewable energy. That also creates a need for transmission. And here, there is, as I said, a strong demand. Other industries are more varied. Some industries are doing very well, while other industries are affected by commodity prices, for example, which are different in different industries. Then I'd like to focus on hydropower. I mentioned previously that energy and in particular, renewable energy is where we see the highest demand. And Norconsult's origins back to 1929 was hydropower, and it continues to be a stronghold for our company. On this page, we see a picture from a project we do for Hafslund called Hemsil. And this is a project initiated in order to increase the power associated with the dam on the picture in order to compensate for intermittent energy sources like wind and solar. Norway and Sweden combined are, in many ways, a superpower when it comes to hydropower. Hydropower is extremely important when we build more intermittent, meaning variable sources of renewable energy like wind and solar. The great thing about Norway and Sweden is that, we already have about 3,800 hydropower plants, which are able to give quite a bit of flexibility to our power sources. The total energy production from hydropower in Norway and Sweden is about 210 terawatt hours, and it constitutes 88% of the Norwegian production capacity and 40% of the Swedish. In order to support the power needs and the power network, the market today is focusing on increasing the installed capacity for higher output when power is needed during periods of less wind and less sun. Improved pumping means that dams are possible to use even more as batteries, increasing their storage capacity. And then we work on modernizing and upgrading the existing facilities and strengthening the power transmission capacity between different sources of power. Norconsult's services to customers are, for example, environmental studies, permitting and compliance projects. It's concept studies, feasibility studies, detailed design and construction supervision for dam and hydropower projects, and it is concept and feasibility studies for pumped storage and rehabilitation and upgrade projects. On the picture, you see one of our projects in the U.K. called Cruachan, where we have a project for pumped storage. And pump storage is also coming to Norway and Sweden. And here, we see a picture from a project called Holen, which we do for Otra Kraft in collaboration with A Energi and Skagerak. This is a feasibility study for a large-scale pumped storage plant in Bykle, Norway. Then moving on to some of our other projects. Here, we have an example of a small project, which we recently have done in Trysil. It's called Trysilknuten, which is the conversion of a flood protection area into a beautiful and very popular playground for the local community in Trysil. And this was also a winner of Norconsult Award for small-scale high-impact last month. Other projects which have been initiated this quarter is, for example, the following at the Vestfold and Sorland railway lines, where we are working on implementation and preparation for the European rail traffic management system, a new signaling system going to support safety and the productivity of our railway system. Another project example is a new road on the West Coast of Norway at Bomlo, 7.5 kilometers with, for example, 2 new bridges and extensive sea filling and blasting work. And finally, I'd like to mention that we have won 2 important framework agreements in Norway and Denmark. The one in Norway is actually 6 regional framework agreements. The one in Denmark is a national one. We are already seeing that activity here is picking up quite a bit, and we are well positioned to support the Nordic defense ministries and organizations for the necessary ramp-up of infrastructure in the Nordics. And with that, I would like to give the word to our CFO, Dag Fladby, who will take you through the financials.

Thank you, Egil. Fourth quarter was a quarter with steady growth and net revenue, which ended at NOK 2.5 billion, up from NOK 2.33 billion. The organic growth was 7%, including the -- adjusted for the calendar effects, which was minus NOK 17 million in the quarter. The growth was driven by higher number of FTEs and also increased billing rates. Looking at the billing ratio, it's 72.2%, slightly down from the same quarter last year, still affected by a weak building and architecture market. And that is also affecting Norway region the most. Our EBITA ended at NOK 227 million, up from NOK 209 million, where we have an adjusted or underlying EBITA margin of 9.7%, up from 9.0%. The increase in margin is basically driven by improved billing rates, but also partly mitigated by lower billing ratio and also slightly higher personnel expenses. Also this quarter, we have one-off expenses related to the gift share program of NOK 38 million. This is the last quarter we have that kind of one-offs since the shares were distributed 11th of November. Profit after tax, NOK 203 million, up from NOK 74 million. And also in this quarter, I'd like to highlight that we have a positive cash effect and that is related to distribution of the employee of the gift shares, which we have a tax deduction on. And the estimated effect on that is NOK 55 million. A short look at 2024, where we have net revenue of NOK 1.19 billion (sic) [ NOK 9,186 million ], up from NOK 8.5 billion and the organic growth adjusted for the calendar is 7%. The calendar effect was minus NOK 54 million in 2024. And looking -- and that -- and the growth was driven by improved billing rates and also increased FTEs. Our billing ratio was still weak. It was 72.5%. That is down from 73.5% due to a weak building and architecture market throughout the year. Our EBITA at NOK 879 million, up from NOK 810 million, where we have an underlying margin of 10.1%, up from 9.5%. And the improved margin is mainly due to increased billing rates and also some effects from cost efficiency measures, but partly mitigated then by lower billing ratio and slightly higher personnel expenses. The one-off costs for the employee share program or the gift shares was NOK 285 million during 2024, which leaves us then with a profit after tax of NOK 498 million versus NOK 516 million, meaning that the profit after tax, of course, affected -- was, of course, affected by the employee share program, the gift share program of NOK 285 million. A short look at the quarter 4 contributors on EBITA before we deep dive into the segments. Two segments are contributing positively this quarter, that is Sweden and Denmark, while 4 of the segments are at the same level in terms of EBITA and Digital and Technogarden is slightly lower, which I will come back to later. On the right side, you see the negative calendar effect of NOK 17 million, which is relating to Sweden and Denmark in this quarter. And then into segments, we start with Norway Head Office, where we have a net revenue of NOK 758 million, up from NOK 700 million. The organic growth is 6% adjusted for the calendar effect, which is actually nothing in the quarter. The growth is driven by higher number of FTEs and also increased billing rates. EBITA, NOK 83 million at same level as last year, while the EBITA margin is now 11%, slightly down from 11.9% same quarter last year. Solid project performance and also increased billing rates was partly mitigated by slightly higher personnel costs. So that's the main reason for the slight decline in margin. Looking at the full year for Norway Head Office, we have a strong year with an organic growth of 8% and also an increased underlying margin to 12.6%, up from 11.7%. So a strong year for Norway Head Office. Then moving to Norway region, where the net revenue ended at NOK 721 million, up from NOK 667 million, an organic growth of 8% in the quarter, which is driven by increase in FTEs and also billing rates. The EBITA was NOK 41 million at same level as the same quarter last year and a slightly lower margin of 5.7% versus 6.1%. We have positive improvement in margins due to billing rate increases. However, the billing ratio is still low in region, and that is partly mitigating that increase. For the full year, we have an organic growth of 6% in Norway region and an underlying margin of 8.9%, which is a decline from 10.5%. And this is mainly due to a weak building and architecture market during 2024 and hence, a low billing ratio in region. Then moving to Sweden. And Sweden continues with strong organic growth of 14%, mainly driven by higher number of FTEs and also increased billing rates. The calendar effect in the quarter was minus NOK 13 million. EBITA ended at NOK 55 million, up from NOK 40 million. And the main improvement is due to that we have positive effects from the senior recruitments we did last year. They are now into black figures. And also, we have a positive development in billing rates and also billing ratios. And remind you that quarter 4 last year also had a negative effect due to the senior recruitment of NOK 9 million. The margin -- underlying margin, 14.9%, up from 10.3% in the quarter, meaning that Sweden is having a strong development in 2024 with an organic growth of 14% and also continued increase in underlying margin now at 9%, up from 7.5%. In Denmark, organic growth was 7%, driven by higher billing ratio and also some write-ups in fixed price projects. We have an EBITA of NOK 24 million, an improvement from NOK 14 million the same quarter last year, mainly due to operational improvements, but also some effects due to that expenses for leaver penalty was NOK 3 million this quarter, while the same quarter last year, it was NOK 8 million, so a positive effect of NOK 5 million. Renewable energy continued strong. The organic growth was 7%, and that was mainly driven by hydropower and transmission due to more FTEs, increased billing rates and also stable high billing ratio. Looking at the FTEs for end of the quarter, we have 417 FTEs at the end of the quarter. That is down from 440 at the same quarter last year. And the main explanation for that is that, we have sold out 3 international subsidiaries, Indonesia, Mozambique and Botswana, and we also have slightly lower FTEs in Poland. The sold units did not contribute significantly to the EBITA, meaning that the organic growth in terms of FTEs in hydropower and the remaining part is still growing at a good pace. EBITA at NOK 33 million, same level as last year, still strong margins of NOK 15.5 million -- 15.5%, slightly down from last year. And for renewable energy, 2024 was a strong year, 14% organic growth and also increased margin ending at 16.8%. And finally, on segments, Digital and Technogarden, where the gross revenue decreased by 3%, where there is a mix where Technogarden is increasing gross revenue due to more use of subconsultants, while Digital are decreasing gross revenue due to fewer FTEs on the consultant part. In terms of EBITA, the EBITA is NOK 8 million and decline in EBITA margin to 4.5%. And here, we see an improvement in Digital due to the measures we have done during the year by reducing FTEs and the cost base and also part of the improvement is a slight improvement due to capitalization of development costs. In Technogarden, we have lower profitability in this quarter. That is mainly due to more use of subconsultants and also change in the project portfolio. Then into cash flow and cash flow from operation in fourth quarter was strong. We have a cash flow from operation of NOK 938 million, mainly due to improvement of working capital. The same -- the comparable quarter -- the same quarter last year was NOK 492 million, nearly a NOK 450 million improvement. Part of that improvement was withholding tax related to the gift shares distributed in November. And NOK 160 million was then paid out in withholding tax in January. If you look at the full year cash from operation, we have a cash conversion of nearly 100%, also adjusted for the NOK 160 million. So strong cash flow from operation. Cash flow from financing activities, minus NOK 98 million versus NOK 638 million the same quarter last year, and that is mainly explained by the extraordinary dividend of nearly NOK 600 million paid out in quarter 4 2023. The balance sheet is strong. We have cash and cash on market securities of NOK 1.6 billion. But keep in mind that NOK 160 million of these are withholding tax, which are paid out in January. Our leverage ratio is minus 1.79x deducted for the IFRS 16 leases. And I would also like to point out a negative working capital of NOK 318 million. And with strong cash flow and also strong balance sheet, the Board has proposed a dividend of NOK 1.70 per share for 2024. That is up from NOK 1.20 in 2023. Our dividend policy is to pay out more than 50%. And as we have also communicated historically the last years, we have paid out between 60% and 80%. And if we -- the payout ratio this year is 103%, but if we take out the one-off costs related to the gift shares, it is in line with the historical payout ratio of 76%. The order book at the end of the quarter, NOK 6.4 billion, fairly stable versus quarter 3 and NOK 200 million up from the same quarter last year. The order intake in the quarter has been at satisfactory level, a good combination of smaller projects, medium-sized and also larger projects in addition to the framework contracts, which only are included in the order backlog when we have call-offs of the framework contracts. And finally, from my side, as always, a reminder of the seasonality in the business, and I would like to highlight the average working days on the bottom right here. In 2025, it's the same amount of working days as in 2024. However, there are big differences between the quarters. And since there's also differences between the quarters, it will be financial impact also for 2025. In quarter 1, we have 3 more calendar days versus the same quarter last year, and that will give a positive estimated effect for us of NOK 124 million. While in quarter 2, since the Easter is in quarter 2 this year, we have 3 calendar days less, and that has an estimated effect of minus NOK 135 million. So even though the calendar days are the same in the first half, we have a negative effect first half of estimated NOK 11 million. And by that, Egil, I give the word to you.

Thank you very much, Dag. Let's talk a bit about the outlook. But first, a few words about the picture. The picture is from another one of our renewable energy projects. This is called Dam Nyhellervatn and was the winner of the Sustainability Award in the Norconsult Awards ceremony last month. This is a project in order to rehabilitate a very large dam in Norway and where the method of rehabilitation has taken particularly well care of the environment and the nature in connection with the rehabilitation. When it comes to the outlook, the overall market is expected to be quite stable. But as I think we all know, there is quite a bit of both macroeconomic and geopolitical uncertainty for the time being. We continue to see small signs of improvement in Buildings & Architecture. And I mentioned previously that in the last quarter, we saw this particularly in Sweden and Denmark, but we also see these signs in Norway. Infrastructure is expected to continue to have stable demand. And again, we expect the strongest activity within energy and in particular, renewable energy. Other industries, we expect to continue to be mixed, but one of the benefits of Norconsult's business model is that, we are organized according to technical disciplines, meaning that it is fairly easy to transfer personnel to whichever market is the strongest one. In the fourth quarter, we are overall very pleased with the results we are able to present today. But as Dag mentioned, there are always some areas where we do see the need for improvement. Both during the fourth quarter and during the first half this year, we will continue to take measures to ensure a good underlying profitability and maintaining our efficiency. And if we look at the fourth quarter results, I think where we saw that there was a need for some further action was in Norway Regions and Technogarden. So there will be some actions taken during the first half of this year. With that, I conclude the presentation, and we are now happy to take questions, and we will start with the audience.

And I see Simen Mortensen's hand from DNB. Would you like to start? Please wait for the microphone.

Yes. It's Simen here. The tax in the quarter is a positive gain. You commented a bit about the changes and impacts on the working capital, but can you please elaborate a bit of what's the quarterly impact through the P&L given the result effect it had in the quarter?

The tax effect, you mean employee. Yes. This is a tax deduction from the gift share program, which is estimated to around NOK 55 million in positive tax since we distributed the gift shares in fourth quarter. So the positive effect is NOK 55 million on bottom line.

And any guidance on the tax cost for 2025? Will there be any kind of similar one-offs or anything going forward?

I think it's fair to say that average tax rate, approximately 22% going forward.

The competitive situation in the market, one of your peers, actually 2 of them have commented that the price competition on building rates have started to increase the last quarter, half year, especially in building areas, et cetera. Can you please give us your take on those trends and if you recognize the same comments?

I think it is fair to say that we have had a strong competition also during the previous years. What is a little bit new now is that, we see some pickup in the Buildings and Architecture segment. And traditionally, the Building segment is where the number of competitors is the largest and often where the level of price competition is the highest as a consequence of the very large number of competitors. So as this segment is now picking up, I think it's fair to say that in that segment, we see a strong competition. But all in all, I'm not sure if we see a large change in the level of price competition.

Martine from Nordea Markets. I have 4 questions, if it's okay. Do you have any more comments on your increased turnover apart from what you said in the presentation?

Well, we see a slight increase in employee turnover, and we saw that in the fourth quarter. I think during the IPO, we had a, let's say, particular share program associated with the IPO, the so-called gift shares, where people had to remain for a year after the stock exchange in order to receive those gift shares. I think that means that some people who might have considered changing employer waited with that until the fourth quarter. We do not expect to see any sustained higher turnover relating to that. We had also our employee -- our annual employee survey during the Fall, and it continued to show a very good score. So we are very much convinced that our employees continue to be very happy with working at Norconsult.

Good. And also about the development in the billing ratio going forward into 2025. Would you expect, for example, the large amount of defense projects, would that be able to offset some of the weaker part in the Buildings and Architecture market? Or would we see a similar level as in 2024?

I think we are also taking actions in our organization where we see there are pockets of low billing ratio. So I'm not sure -- we are not taking anything for granted in terms of increased defense-related activity sort of solving any challenges associated with this. We are dealing with it, adjusting capacity to demand where we find that to be necessary. So all in all, I would like to say that we have a strong focus on the billing ratio every quarter, and we are taking the necessary measures independently of how the market is developing.

Perfect. And on the billing rates, you had still continuing development similar as in Q3. Do you see that also now into Q1 in 2025?

Would you like to comment on that?

Yes. The index regulation are slightly lower than last year in the Nordic market and especially. So the interest rates, which we will gain from index regulation on contracts lasting more than a year will be slightly slower than we have seen in 2024.

And the last one, it was about the amortization impairment where a lot was related to the Technogarden, approximately NOK 5 million. Can you comment on that?

Yes, that is related to Digital actually, and it's a write-down on some software, which we had developed some years ago.

One question from me as well, Magnus Rasmussen from SEB. You spent NOK 50 million on CapEx related to property, plant and equipment. Can you just elaborate on what that is and whether that will continue going forward?

I think it was slightly higher than normal this quarter. And I guess that's the reason for asking. This was also some technical equipment related to projects, which we invested in this quarter. So I don't expect NOK 50 million to be the running pace going forward. It's more at historical levels.

Bengt Jonassen, ABG. Two questions, if I may. If we look at the renewable, the divestments and what seems to be a small restructuring in Poland, do you have any restructuring charges? That's one question. And I think you're alluding to that you're looking at capacity in certain segments in Technogarden and Region Norway. Could we see some restructuring charges related to that for the first quarter? And finally, on the dividend, should we look at the payout ratio related to ex gift shares or reported earnings per share, so 76% or 100%?

Dag, would you like to...

Yes. I'll start with the last one first. Reason for taking -- for mentioning the 76% is that, we had one-off costs. So I think it's more to underline that this is more the normal level between 60% and 80% if we don't have acquisitions, which need quite much funding. So it's more a normal level of 60% to 80%. So even though the reported was 100%, we felt that the normalized taking the one-off cost related to gift share was a way to show it.

And then Poland restructuring.

Then Poland restructuring, now that is actually people who have left the company for competitors. So no restructuring cost as such. The other international subsidiaries, which we have sold, that is minor business, and we have decided to close down that exposure in these countries because it's limited business. So no restructuring cost on that as well.

And the final question you had was relating to Technogarden and Regions Norway, whether we could expect special costs there associated with restructuring? Previously, we have had some smaller restructuring, for example, in Nordic Denmark, Nordic Norway and in Digital. Those costs have been fairly small and the actions, which I alluded to now are also not of a large magnitude. So we are talking fairly small amounts. But I wanted to mention it as there is always a little bit of that kind of, let's say, ongoing adjustments, which could be necessary in different parts of the business.

Question from the web.

So we have Jesper Stugemo from Handelsbanken. There has been a continued strong profitability improvement in the Swedish market. Are you gaining market shares in Sweden in some areas? And how much headroom do you have for continued price hikes in Sweden and Norway?

We have gained market share in Sweden. That is correct, both through organic growth and most recently associated with the acquisition of Sigma Civil. I wouldn't really characterize the situation in Sweden as a situation based on price hikes. There is a lot of competition in Sweden, but we have been able to do well in that competition, and we expect to continue to do that. When it comes to the situation going forward, our CFO mentioned that the annual index regulation this year is less than what it was last year. And in combination with, as was mentioned previously, some price competition in the Buildings & Architecture market, in particular, I don't think it is realistic to expect the same total degree of price increases for the coming year compared to the previous year.

Then we have another question, which is how competitive is the recruitment in the renewable energy sector? Can you manage to ramp up in the course of the year within energy? And what are your expectations for the group?

During 2024, we have been very successful with recruitment in the Norwegian Renewable Energy business. The fact that you saw FTEs reduce in that segment was due to reductions outside of Norway in the divestment of some subsidiaries in Mozambique and the Philippines and also a reduction in Poland. So we are very successful in terms of recruitment in the Nordic Renewable Energy business, and we expect to continue to be that going forward.

Another question here is, how should we look at the potential margin dilution from Sigma Civil in Sweden?

Yes. I answer that. As mentioned earlier, the Sigma Civil, they had a loss-making operation in 2024. We have established good integration plans to both improve the cost efficiency and also to improve, you can say, billing ratio and margins. That will be dilution in 2024. Exact how much it will be, I will not go into details. But it will be a small dilution since they are starting from, you can say, a loss and -- but we will have quite fast cost reductions as house rents are -- they will move into our offices.

And then we have Johan Sunden from Carnegie. You mentioned that there has been better activity within Buildings & Architecture in a few geographies. Can you give some more color on which local regions where there has been better activity within various countries?

Well, I can mention that I'm in particular, impressed with our architects in Denmark. There, we see a significant lift in activity and performance. And also our Swedish architects are doing very well. So I'd like to highlight those 2, even though there are also other positives.

And then can you also clarify what the changes in the project portfolio in Technogarden mean?

Yes, that's different clients and different markets. So it's -- we have 3 different markets. It's consultant, it's IT and it's also the Swedish part. So it's a mixture between the clients in these market areas.

Yes. We have, for example, seen a drop in the Swedish car industry, which is one of the impacts Technogarden has had.

That concludes the questions from the web.

Okay. And yes, I see one more question here.

One more question from Magnus Rasmussen, SEB. You mentioned that price index regulations will be lower in '25 than in '24. Does that also apply to wage increases and other cost increases?

That remains to be seen. Obviously, the development in the economics in the different countries and how the forefront, you can say, negotiation will start will also have also affect our salary increases, but it's too early to say.

Okay. Then I see no more hands. So that concludes our fourth quarter presentation. Thank you very much for following us, and see you next time.

Thank you.