Addlife Capital Markets Day 2023

Welcome to AddLife's Capital Markets Day. My name is Helena Nordman Knudson and I will be your host this morning. We will start off with a presentation by our President and CEO Fredrik Dalöy, who will give you an overview of the current state of the company. He will talk about the overall business model, the market and growth drivers, as well as the diversified portfolio and the company's current priorities and actions. After that, our CFO Christina Rubenhag will present a deep dive into the figures and discuss both the P&L and the balance sheet with an in-depth presentation on organic growth, profitability, net debt and cash flow. There will also be a presentation by Peter Simos Baka, our CCO, on Performance Management and some of the tools and the approach AddLife has to drive performance within the group. After Peter's presentation, we will have the opportunity to listen to CEO Ken Fisher, supported by Matias Bson from Biolin, describing how AddLife's business model is turned into practice. We will round up this morning before break with a Q&A session. To make this a smooth process, Fredrik and Christina will answer questions that come through our online feed only. Please remember that they will not answer any questions regarding the Q3 report, and please only one question per person. Thank you. And then after that, it's time for a break and grab a cup of coffee or tea and be back in time, no later than 10:30. After the break, we will start with the panel discussion where we will discuss AddLife's ownership and advantages of being part of this entrepreneurial group. After that, we will have yet another case, this time MBA CEO Carlos Pinto will present MBA's differentiated portfolio within high-end Healthcare Technology Solutions, again reflecting the circumstances of being part of AddLife. Finally, and as a highlight of the day, Fredrik will give an in-depth strategy presentation. This presentation will contain the different elements of the company's strategy and focus areas. And before we close down and say goodbye, we will wrap up today with a short Q&A session. You can start sending in the questions as soon as you have one. The questions that have not been answered will be followed up during the next couple of days. For questions, remember to use the QR code provided. All questions need to come through digitally. And now, let's get on with the day and let me present our President and CEO Fredrik Dalöy. Welcome to the stage.

Thank you very much, Helena. Thank you and most welcome to all of you today. I'm very happy to see so many of you have chosen to join us here today live in the studio, and I know that also we have a lot of people joining us online to follow the day here today. I'm very pleased with the fact that we have been able to gather so many people from the organization here today. They will help to give you a flavor of what's going on in the organization. So we will have Carlos and Jussi and Ken speaking about their respective companies. I think that is very, very important. As you well know, we are a decentralized organization and the focus is on what's going on in the companies. This is where the deep customer knowledge lies, the strong customer relationships, the product knowledge and the market knowledge, and this is where the action happens and where the success is created. So I think you'll find it very interesting to hear their stories. I'm also very pleased by the fact that we have Peter here as well today, as well as Matias and Tor, who all have strong and successful operational backgrounds and have now moved on to take a bigger role in the company to support the other groups' companies in their development. So this is another key factor for success in our group. Looking back a little bit, when I joined the company about a year ago with an experience from labtech, Medtech and home care business of around 25 years, I knew that I was getting into a company with a very strong business model, well established and well functioning, but maybe most importantly a very, very strong culture. This culture is very important and also very close to my own values and my own experience from previous roles. So this is something that's of huge importance and value to everyone. So coming into the company, meeting all the teams, visiting the companies, discussing the plans with each and every company, I've come to learn more about this business, this business approach, the strategy and how we work as a company, and I can really see the strong value that that has given over the years. So as you will note from some of the presentations today, we are sticking to many of the tried-and-true approaches, the culture, the business model and so on, but we have also made evolutionary steps. We have updated the organization to reflect the bigger and more international organization that we are today. We have taken actions where improvements are needed and so on. So it still has this strong similar culture that has made AddLife successful over so long time. So now we will move into the presentation and we will start with an overview of where we stand today. So starting with vision, which is a very powerful one: we strive to improve people's lives by being a leading value-adding provider in life science. This is a vision that we all stand behind as a company and something that generates a lot of passion within the group and is very motivating. I think we're all fortunate to be able to be active in this life science industry where everything we do every day really counts for the patient. Moving on to our business model, as you well know we have a proven decentralized business model. We're trying to combine the flexibility, the personal engagement and the efficiency of the small company with the larger company's resources, network and long-term perspective. And this mix, done correctly, is very successful. We are an active owner and that has many shapes and forms. We have the AddLife Academy that you will learn more about today as well. It helps to improve the organizations, it helps to improve the teams and also helps the individuals to evolve in leadership skills, sales skills and so on. We have a fantastic industry knowledge within the group where we are knowledgeable about the products, the respective geographical markets in detail, and we also have a fantastic network that each member of the company can utilize. And this is proving very, very successful. We do take a long-term investment perspective and that means that top line is not necessarily the focus. Profitability and cash flow are the main drivers for us and that is what we drive, and you'll see examples of that during the day. In addition to that, we take a long-term perspective, meaning we're ready to invest for the long term to develop the companies for future success. We also provide a lot of support for the companies around business development tools, very clear KPIs and well-structured business planning processes. We make sure that each company has a strong board appointed, and that means a board that is knowledgeable in the industry, has the relevant geographic experience and also is very familiar with the specific development phase that the company is in. And on top of that, we offer support for the different groups in the company when it comes to analysis of business performance. Very importantly, we can provide very relevant benchmarks for the companies, and that is a unique benefit as well that you will learn more about during the day. So with this, we can be an active and value-creating owner.

I mentioned the culture and the values and these are really core to us. The simplicity, responsibility, commitment and innovativeness is something we work with every day and this is part of the trainings that we have and in the decision makings that we go through every day. So yet another key component of the long-term success of AddLife. I will also talk a little bit about sustainability. We will keep that relatively short because this is nothing new. This is something that is totally ingrained in how we run our business today. We have defined targets that are well communicated all across the organization and each company has their own targets and the leading individuals have their incentive plans also connected to these targets. We split it up in three major parts. The first is we want to be a driver of sustainable offerings. It's important to note that our part of the value chain represents a small fraction of, for example, CO2 emissions in the value chain. However, we are in a position where we can influence other parts of the value chain, so we take an active role in that. We try to work with our suppliers to improve the profile of their specific product lines and also we work with logistics and of course the end user to make sure that they are running it in the most efficient way. It's important for us to be an attractive employer and a strong business partner. This comes very natural to us with all the values that we have, so we emphasize culture, employee growth, organizational development, and also inclusion, equality, transparency and compliance. In all these areas we have pretty ambitious targets. Last but not least, of course we want to be a responsible market participant. That means everything we can directly influence, such as solar panels, electric cars and so on, we make those decisions quickly and do everything we can to make sure that we are a responsible part of the business. So I want to move on to give a little bit of a background of our business as well, which you well know has transformed quite a bit over the past few years. So looking at our profile back in 2016, primarily a Scandinavian company, but now and only when we were launched we had around 1.5 billion Swedish kronor in revenues and the majority of the business in labtech. As the business evolved, by 2019 we had more than doubled the business and extended our footprint a little bit more into Europe. But then of course looking at the situation in 2022, clearly we had again more than doubled our business with revenues of above 9 billion Swedish kronor. Interestingly, here you can see that Medtech has become the largest business area and our European coverage is significant. So these are important changes and they also reflect the actions we are taking today to evolve our business and primarily leverage the opportunities that this new size and footprint provides. So AddLife group at a glance by 2023: we are active in 29 countries, we have more than 2,300 employees, 80 warehouse locations all across Europe. This is a quite impressive number enabling us to be a very, very strong and reliable partner for our customers that have come to rely on us for quick and predictable deliveries. We have 54,000 customers, 3,500 suppliers, and believe it or not, 18 million SKUs. That's an amazing number that our companies are very well able to manage.

So moving forward to how our portfolio products looks nowadays. I will share with you this slide where you can see that the hospital segment has become the biggest part and it's under the umbrella of the Medtech business unit. Here you can see also Home Care, a smaller share but very important. The business is active in a huge range of segments that we have strong specialities within, and the same is true on the labtech side where Diagnostics is a major part of the business and biomedical and research is almost the same size. So looking at the slides, it will give you an understanding of the number of segments that we're active in, closely related segments where we have strong competence, but it also gives us a well-balanced portfolio from a product standpoint. Moving on, looking at the European footprint again, as I mentioned earlier we are present in 29 countries and as you can see here the revenue is fairly well spread over the continent. You can see that the Scandinavian markets now represent maybe around a third of the revenues, so meaning that we are indeed clearly a European player now. This also gives another level of stability because we are not relying on a single country for our development, but our decentralized approach also makes sure that we have a very strong local customer knowledge in each and every market. Looking at the industry we're in, it's a very attractive one in many ways. Not only do we get to help patients every day in improving their lives, but it is also a business where there is stability in the growth. As you can see here on the left-hand side, the orange bars represent healthcare spending in Europe as it evolves over the years and it's hugely stable. The GDP growth though can have significant swings, but we're fortunate enough to not be too dependent on that. This is also reflected in the revenue of our company as you can see on the right-hand side. It actually starts in 2014 when AddLife was just a business unit within Addtech, but here you can see again a very stable and growing growth profile. So we are fortunate in many ways to be in this very stable industry. Looking forward, we have outlined what we can expect in terms of market growth. The medical device market, which is a much bigger market than the diagnostics market, there we are expecting growth of around 5% per year up until 2025. In the in vitro diagnostics markets, which we can use as a proxy for the labtech business area, the growth is expected to be 2 to 3% per year. There are many important drivers behind this. Demographics is certainly one thing. We all know that there's an aging population all over Europe. We also see a rising prevalence of chronic diseases as well, and preventive and personalized medicine is increasing, and that is actually helpful for us both in the medical device market as well as in diagnostics, again forming a very important link between these two business areas for the future. There is also an increased focus on clinical outcomes, health economics and productivity. This will be a powerful growth driver for us and an area where we can certainly contribute to the development of the healthcare system. So these are more high-level pictures and it gives you a perspective of where the market is heading, but let's get into a little bit more on the details of the product offering and our position in the value chain.

So as some of you know, the vast majority of our business is recurring revenue. It's actually around 80% and the structure is normally around an advanced instrument sale that you can see on the top in this graph. It could be advanced instruments for sepsis, PCR testing, blood gas analysis for example, surface analysis which you will see examples here exhibited today. These installations often come with a steady flow of consumable sales such as aspirators, disposables, reagents and such. Also very important in the orthopedics business are all the types of implants that we provide in a steady flow to all our customers, and of course every type of product that we provide such as trocars, drainage products and so on that are used in surgical procedures. So the business model is really set up around instruments and the recurring long-term revenue of consumables. So moving forward to our position in the value chain, we are positioned very close to the customer. We take care of warehouse, logistics, marketing and sales and services in our role as a distributor. This means we have a very, very close relation to the end customer. This is very important because we pick up the trends real quick and we are able to adjust the product portfolio continuously to the needs that are evolving. And with our strong service component, we also bring really, really strong customer relationships. As you can see here on the slide, we are also active in product development and manufacturing, and one good example of that is of course the Biolin product and the Biolin business that we will be seeing presenting here today later. So there we are not only a commercial entity but also developing and manufacturing. Our partners many times are the product companies, companies that manufacture and sell products. Sometimes they sell through us and sometimes they go direct, and sometimes also important to note the trend is the reverse. We are seeing right now in multiple locations product companies abandoning their direct sales strategy and moving again back to a distribution model. So we have a strong position in the value chain with very strong customer relationships and an ability to constantly evolve. So I touched upon the service component and the value-add that we bring, and that's also very important to note. There are simpler ways of distribution like box mover or commercial partner models. We have evolved much further than that to the right in this slide where we provide value-added services and we act as a productivity partner. This means a wide range of services: set up operating room support, clinical application support, clinical study support that we will hear Carlos talk about later today, also examples of where we take the responsibility of a product in the entire life cycle of that product including rental, reconditioning and life cycle management. So we have evolved very far to the right here in this graph and this gives us a very strong position versus the suppliers, the customers, and also gives us strong pricing power. So speaking about the position in the market, I also want to talk now about the growth plan that we have set out a number of years ago. As many of you know, during the pandemic we saw a great growth driven by COVID. So here the companies showed their agility and strength and ability to adapt to the new conditions by supporting the healthcare system in a very, very strong way during the tough times of the COVID pandemic. We of course knew that this situation would come to an end at one point, so the company made some good moves in terms of being able to create a strong acquired growth that would succeed the COVID revenues that we saw. So as you have followed us, you have seen that indeed the COVID growth was followed by strong acquired growth. This acquired growth was in selected segments and markets, and by that we were hoping to see post the pandemic a very strong organic growth. We can now see that that plan is working. We have seen in the first two quarters of the year a very, very strong organic growth, and that's for us a very important sign that our positions are well selected. We have a good group of companies and the companies are flourishing under the AddLife umbrella. So that is a very, very important component and we are very pleased about that, and we will certainly be talking more during the day about the different components of why the companies are so successful. So right now the organic growth is our main focus, but as we move forward we foresee again entering a mix of acquired and organic growth. So what are then the priorities for us as a group? These are the top four priorities that we have also communicated earlier: it is to protect and improve the profit, it is organic growth, it's cash flow, and as number four, acquisitions. So this is the order of importance as well that we put to it.

But I want to talk a little bit about what is it that we are actually doing along these priorities. First of all, on the profit side, price management has been very, very important recently. This is an area in which our companies are really, really good. We take a very active approach to constantly evolving the prices, not only updating the price list once a year but a constant evolution. This has been an important skill during a period where we saw price increases coming quite a bit from suppliers, in particular during the second half of last year. So this was an area of focus during that time and we were able to increase the prices towards our customers in a very, very significant way. So in almost all cases we have been able to pass on these cost increases to our customers after sometimes negotiations and so on. It is also a method of course just price increase but also evolving continuously the product portfolio as well as increasing the service component and also working with different pricing methods such as payments for logistics costs and whatnot. But this has been going well and you can also see that in our numbers that we have been protecting the gross margin in a good way. Of course then organic growth in high margin segments is going to be very important and you will see examples of that going forward. And as we move forward, of course we are also reviewing the efficiency, organization structure and priorities in selected companies. I want to share with you a few examples of that. One area is in the Home Care field where we are having a fairly large component of our own products. We're working to optimize that product portfolio and optimize the way the companies work together, and that will lead us to improved profitability. We have also reviewed our portfolio of development products to make sure we are focusing on the areas where we see most potential moving forward. We are also been working quite a bit on the company AdVision that many of you are quite familiar with. This is a European distribution business in the eye surgery area. This is a very attractive market and this market also has very stable and interesting growth drivers. However, as many of you know, we have seen a gradually decreasing profitability in this business over the past few years, and this has been driven by a few lost supply agreements but also changes in reimbursement systems and so on. Now we have taken a number of firm action steps. We have new suppliers in place to replace these lost products, and we have launched a new product that will replace that revenue and profit that we lost in reflection of a more advanced and high-tech product portfolio that we now have. We have updated and strengthened our sales force in the major markets of Europe during the summer. We have gone through extensive sales training in those sales teams as well. And now in the most recent weeks, after a long period of thorough analysis, we have implemented a new and decentralized organization within AdVision. This way we are empowering the country teams, making them more agile and able to quickly respond to the market needs. This is an area where we have seen some weakness previously, and of course by removing those overhead functions we are also significantly reducing cost. So this is an example of actions we are taking to in a strong way improve profitability where needed. Organic growth then. I'm very pleased by the fact that we are indeed back in full scale commercial activities after the pandemic. So our sales teams are out there, they're meeting customers, they're doing new product demos, they're launching new products, they're hosting and attending industry fairs and so on. So this is positive for the sales as they stand today but also for the future potential. We have taken on a number of new and significant supplier agreements. These agreements are often times multi-country agreements of a size that we have never done before. This provides us with huge potential growth for the future. And finally, we are supporting the healthcare system in the strong increase we see in elective surgery. So this is a trend that we are expecting will continue in the near future but also into next year. So to give you a little bit of a flavor of how this is developing, we have gathered information from all our companies in Europe to get an assessment of where we stand as it relates to elective surgery. Clearly now in the healthcare system, the activity is picking up but the activity is still below where it was in 2019 before the pandemic. So this means that the healthcare systems still have to increase activity to really be able to tackle all the patients that are waiting for surgical procedures. So we are expecting that this increase will continue and we are right now as we speak in the mid-2023 at less than 95% of the surgical procedures conducted compared to 2019. We think that will increase towards the end of the year to reach just above 95%, but still below. So this means we expect this positive tailwind that we have, the trend that is helping us in terms of growth within the Medtech business, to continue throughout the year and well into the next. And you will hear also Carlos talking about that later today. When it comes to cash flow, this is certainly a key area and that attracts a lot of attention for us. But on the other hand, this is also an area where AddLife is really, really strong. We have many measures and methods to improve cash flow, to make sure that the working capital situation is effectively managed. We have methods and tools to track this and we incentivize our team based on this. So again, a key strength of AddLife. And as you will see later today as well, we have a great track record of improving these factors for the companies within our portfolio. And when we look at inventory reduction, we have also worked on selective targets for the five largest companies. Christina will show us later that indeed the major part of the inventory is indeed with the top five companies. So well before the summer, each and every one of these companies has been given a clear target that we are expecting them to meet during the second half of 2023. In addition to this, we have a hands-on detailed cash flow analysis project started with the major companies within the group. This way we can analyze in a very detailed way together with the companies, supported by the business control teams, every aspect of the cash flow and find improvements. So all in all, we think that there will be an improvement in cash flow in the coming quarters.

So looking at cash flow and cash conversion, I want to share with you a little bit of a framework and a reflection on how these things have evolved over time. So as you can see, cash conversion in the pre-COVID times was around 70 to 80%, a pretty healthy number. During the COVID it increased quite a bit to over 100% in many cases, of course a special situation. In 2022, we saw the new structure of the business in place and COVID declining. And when I say new structure, I mean the bigger share of Medtech that is traditionally tying more capital. Nevertheless, during that period we had a cash conversion of around 80%. In the beginning of this year, the first two quarters we have seen 35%, so an extremely low cash conversion. And that is certainly a reflection of the fact that we have taken on many new accounts and we are seeing a strong pickup in the growth rate of the Medtech business. So over time, we expect this to normalize again towards more numbers looking like the previous history. So that is around the cash conversion, and as we have talked about, this is a very important factor right now also closely linked to our acquisition strategy. So what you will be seeing later today is a quite thorough analysis of prioritized targets and segments in which we want to grow going forward. So we have really taken a strong effort to map these out and make sure that everyone within the organization knows what kind of segments we are looking for, and we will share that with you later today. We have indeed reduced the acquisition activity during 2023, and we expected to gradually improve in the next year. However, constantly watching carefully the cash flow and the debt level. So when the cash flow gets back to a more normalized level again, we expect to maybe be able to allocate around 25% of that cash flow to acquisitions. However, the main priority here is to reduce the debt, and once that is in place we can slowly again start with the acquisition activity. And also when we do move forward with acquisitions, the focus will be on small to medium-sized acquisitions and where we can leverage our new European footprint and our segment exposure. So these are the activities and priorities that the company has been working on recently, and this will be the priorities going forward as well. We are really happy that we're seeing a very, very strong organic growth all over the business. So the approaches and plans that we had put in place are indeed working. We see a positive trend as well in the profitability, and the cash flow is high on the radar screen with strong and dedicated efforts to improve them. And I'm saying again, we do expect an improvement here during the coming quarters. So with that, I want to sum up by stating that we are indeed reiterating our long-term financial targets. That means that we continue to want to grow by 15% per year in terms of EBITA, and that means a doubling of the profit in the coming 5 years. The profitability target is very important for us, and as you well know we measure profitability as profit over working capital, so again highlighting the fact that we are focused on strong working capital and high working capital efficiency. And finally, the dividend policy of 30 to 50% remains unchanged. So with that, we can round up the introduction here and I want to hand over the word to Christina, our Chief Financial Officer. She will give you some more details about the financial situation. So welcome, Christina.

Thank you very much, Christina. I will talk about Performance Management and also performance improvement, how we work with that. And I think this is of course a very interesting topic for us if we...

Look at our way of working in our approach. I think it's really good that we have this kind of clear financial targets. I think we talked about them already, and Christina talked about, and also Frederick, that we talk about this profit growth more than 15% per year, profitability profit over working cap more than 45%, and also what Christina just talked about, the performance matrix that really makes it clear for a company depending on what kind of margin they have in the company where to focus. So everybody in the company will understand why they make certain actions because if you're below the 10%, all the actions in that company would be related to improving the profit margin. So it's really clear in that kind of respect. In order to grow the business, of course we also need to develop, and I think development is really crucial for us. And of course development can be very, very different depending on the company. And this is just a few examples about possible areas for development. But why we highlight this with our companies is really that they have to devote time, they have to devote time to development, because development doesn't happen by itself. And this is really important for us for our future growth. So how do we bring this kind of message or information to our subsidiaries, to our employees, to our companies? And the tool we are using is AdLife Academy. AdLife Academy is our own academy, a training center where we are training our employees in different kind of ways. And we've had this AdLife Academy since the very beginning in 2016. So what do we offer for kind of trainings? The vision and corporate philosophy training, that's some mandatory training for all our employees. And when we are acquiring new companies, within three to six months we make this kind of trainings for all the employees in that company. It's a one and a half day training where we go through the history of AdLife, we talk about of course the vision, we talk about the strategy, we talk about the requirements that we have for the companies, and of course about the tools, and last but not least our core values. So it's really a very important thing for us to have these kind of trainings, and part of that is of course also to discuss our toolbox. Besides that, of course we have a lot of salespeople and we need to see that we improve the sales skills, so we have several times of different kind of sales trainings going on. For our service technicians, that usually are fantastic sales for us because our customers they love them, but the sales guys don't really like to be, or the service guys don't like to be a salesperson, so we have a training, soft sell, so they can give some kind of guidance and also bring back leads to our sales organization. Last but not least, of course it's important to see that we have our leaders really can lead in a good way, so we have leadership trainings for all our leaders in the group. So from 2016 when we started in March until 2022, we have almost 4,800 people in the organization going through this AdLife Academy. I think that's a fantastic number, and we're driving this by ourself. So I think at this point probably we're around something like 5,000 participants. So one of the key things we are really learning in these trainings is really the art of optimizing six parameters, and once again it's linked to the super parameter what we're working with: profitability, profit in relation to working cap. And of course when it comes to the profit part, how can we increase profit? And of course we need to sell and sell more always helps. I think that's really what we need to focus on: how can we sell more? But in order to get the profit, we always need to have a gross margin. And what actually Fredrik mentioned before is that we have been extremely good really working with the gross margins in our companies, and especially now during the very, very big price increases we were able to carry out the big part actually to our customers. And during our training we actually have a small credit card (probably you can't see it but I can hand it out afterwards). This is a card actually showing how much more in volume you need to sell if you give a discount. So if you have a 40% gross margin when you start and you give a 10% discount, then you need to sell 33% more in volume in order to get the same kind of gross profit. And that's fairly a big amount, I need to say. So this gives really the people the understanding, the sales, that I really need to work hard to really maintain or even increase our margins. The good thing is if you turn that card around, and this is what the clever sales guys does, they can see how much less you need to sell in volume if you increase the price, increase the gross margin. So I think this is an easy tool, hopefully they carry it very close to their heart every day when we are doing these customer calls. And of course looking into the expense side, of course we should see that we're very cost efficient in what we're doing, always question ourselves: does this really give value to the company? And if it doesn't, I think we shouldn't really do it. Coming to the working capital, when we look at the working capital it's really what the companies can influence. So what we are talking about is of course inventory, and inventory as also Fredrik mentioned before, I think it's really something that we have focused on right now, really see how can we increase the inventory turnover rate and also reduce inventory in this kind of respect. The next part is the accounts receivable, really to see that we collect the money in time. The customer should pay according to our agreements. And of course it's quite different if we compare to, for example, in Finland where they have 20 days DSO, and then further south you come in Europe you have some more days than that. So of course it's different, but the important part, the message to our employees is that the customers should pay according to the agreement and not 50 days later. That's really the message. So we should collect that part. The other thing is of course working with our suppliers when it comes to the accounts payable, really seeing that we have good agreements in place, should at least be 45 days, 60 days payment term to our suppliers so they can lend us money instead, that we collect the money faster from our customers. So why do we talk about these kind of things? It's really about optimizing these six key parameters, fine-tuning, fine-tuning, fine-tuning. And I think really the takeaway for the employees in our companies is that everybody, everybody in the company can influence at least one of the six parameters, which means that everybody can contribute to the profit profitability in the company. Coming back to the tools, one of the tools I think probably one of the most used tools in AdLife is the Johansson analysis, and that's the profitability and business analysis. And what you see in this kind of example, what we start actually is to look at the profit over working capital analysis, and this can be really used in many, many different ways. So like in this example we're having different kind of dimensions: it can be suppliers, it can be product category, it could be customers, it could be sales department, and that's really the nice thing with these analyses. So then we really go through the whole calculation about gross margin, sales cost, profit, inventory, accounts receivable, accounts payable, and finally also we come to a profit over working capital score. And what we can see in this example is of course we have something here in red, 7% in profitability, that's not according to our level of at least 45. So what we use this kind of analysis for is really to use tail cutting, that we really can take away non-profitable business and really see that we focus our time and efforts for something that really is profitable, giving value to the company. Of course, how to allocate capital for profit improvement and business planning. So this is really one of the fundamental tools what we really are focusing on in AdLife. And to really give you a fantastic example, a company been a long, long time within the group and really has been using these six parameters fine-tuning, fine-tuning, fine-tuning all the time is Triolab in Finland, our diagnostic company in Finland. And if you look at their journey, starting already from year 2000, it was really a small company, it was 3 million something like that, and then building up over time, increasing sales but also increasing their profit margin. So at a nice time here in place 2012 they crossed the 15% profit margin, and really been growing also after that in a really fantastic way of using our tools in a good way. Of course we can see here that this is of course the influence from the pandemic and the nice COVID-related sales what we had, but really, really nice performance. And also if we look at the profitability, 48% — yeah, that's higher than 45, that's really good. And they always be between 300, 350 up to 400, so it's really a fantastic case to showcase. So next we're going to have a case study regarding Bioline Scientific, one of our companies that we acquired in the end of 2016, and a bit about their journey from that until now. And they also have been using a lot of our tools what we have talked about during that journey. So welcome to Kin Fisher and Matias Bengtsson. Thank you.

So warm welcome to Bioline Scientific. We are a Swedish-based company with our headquarter in Gothenburg, however our operation and R&D are based in Finland. We provide state-of-the-art application solutions to scientists R&D and product development departments in surface science. We have a strong track record and history in the academic field, and our long-term strategy is to increase our presence in the industry field in the years to come. And now we share more about that later on. But now I will hand over to you, Matias, the former CEO of Bioline Scientific, today you are the board of director, and you will share the background and understanding from 2016 when AdLife acquired Bioline Scientific. Thanks.

Thanks. Key word: leading surface science. What does that mean? Bioline Scientific, we develop, manufacture and sell three different product lines, all are focusing on interactions and analyzing surface interactions. Starting with Q-Sense to the left here, we are the pioneers of the QCMD technology. We were the first inventors and we're still leading that market. What it does is that in real time it can detect a mass change on a surface on a nanoscale, so we're talking one molecule in or out. It's an extremely sensitive technology. I will talk a little bit later about what it does and what it does for our customers. We have Attension, tensiometric measurement, a technology used to categorize surface properties but also surface to surface interactions. KSV NIMA, that's a tool for fabrication of organized thin films, and when I say thin, I mean thin as in one molecular layer, so extremely thin layers. And it can be used, for example, when companies are developing solar panels in the next generation efficiency. Here you see a lot of applications, and our products, technologies and solutions are providing the market with a broad opportunity to investigate surface interactions, and could either be for academic but also for industrial customers. As you can see, as an example, I would like to try to become a little bit more tangible, so I've selected three applications and tried to highlight what it does. First, biotechnology and medical devices. The Attension equipment and tensiometric measurement can develop the surface properties, for example an implant. So in this case biocompatibility is of essence, so with this technology we can predict whether the implant for permanent use is biocompatible with the body or not. The second one is called pharmaceutical. And in this case, let's say you're a drug formulator in a pharma company, what you want to avoid is aggregation of the active substance. And if you can avoid that, you can use the Q-Sense technology to predict aggregation or not, and if that's done in a secure way, the actual uptake of the drug substance in the body is secured. The third application is something completely different. Electronics. Here we support the companies developing next generation of electronic circuit boards. With the QCMD technology we can make sure that the surface is extremely smooth and the thickness of the layer is extremely thin, and if that's done in a very consistent way, companies like Intel can develop the next generation processors which are even faster than today's processors. So as you can see, we have a lot of other applications as well, but this is kind of the breadth and an example of what we can do and supporting our customers. Here you have a bunch of what I would say companies and universities, but if you look a little bit deeper, you can see that they're quite a good spread, various companies, various academic, but also geographically. But what they have in common is that they're leading in their specific fields. But they're also customers to Bioline Scientific, so if you ask me I would say it's kind of a strong customer base that we have here, and we have many many more. So what it means is that we support a lot of high-tech companies in various stages of their product development. So coming back to this 2016 and onwards, as you mentioned, end of 2016 Bioline became a family member of the AdLife family. Previous owner was a Swedish private equity firm, and I've been told that they had extremely short focus and impossible expectations. I wouldn't say that we have tough expectations, not that, but maybe we are working in a slightly different way, because when we enter into a new company we start with an assessment, an assessment that we understand the organizational setup, the stages of the project, and kind of take the temperature of the company immediately. We of course implement an awareness of the financial KPIs that Peter talked about before. We do talk about profit expansion over 15%, profitability profit over working capital above 45%, but we also talk about development of continuous improvement inside the organization. We also add all the AdLife tools we have in the toolbox. When we assess the company, in this case after we'd done a few Johansson analysis on various levels inside the company, we quite early on understood that the sales organization in North America didn't generate any profit, and in fact it had not generated a profit for a few years. And when we interviewed the company and the people there, it didn't really come as a surprise because they'd lost top management and the sales organization a little bit lost the momentum. So that was a tough decision taken to actually switch from a direct sales method into a distributing setup. But once that tough decision was taken, we could immediately see that we were generating profit and the business were turning a little bit. But what was more important, that after a few months we were kind of given the second wave and second task of generating long-term growth. We were given the task to develop a new strategy for long-term growth, and we did what we always do in Bioline: we went to our key opinion leaders, our leading scientists internally and externally, and looked for market input. And although we had focused on industrial customer as well as academic customers before, we felt that we needed to do something slightly different and maybe much more deeper than we've done before. So we started with product development, but with the product development with the mindset of an industrial application, industrial user, and they are a little bit more demanding when it comes to user friendliness, level of automation, and maybe also interpreting of the data. So with that mindset we were starting our projects at that time. We also had an opportunity which I'm really glad that we did, was to decide on a design guideline. So the ambition was to have three product lines but with a design DNA that made them stick together from an outside appearance look. The last part related to industrial applications: there are, as you see, many applications and we had to select a few, the fastest growing, the most prominent arguments that we have for our products, but of course also selectively development into maybe a little bit more tangible arguments. We need to quantify the sales arguments, we need to generate kind of a more value-added approach to those customers. And of course when the assessment was done and the new strategy was shaping up, it didn't really transform overnight, but most of the work were done in 2019, and then of course it took quite some time until we started to launch our products. So what happened? I mean we started in the end of 2016, and here I've tried to call this slide "Bioline on its way." You see revenue in orange, EBITA in purple, and EBITA presented as a green line from 2017 up until today. The first phase I've called profit improvement. So after the assessment we were focusing on profit improvement, and we did make this tough decision, and as you can see already in 2018 and 2019 we managed to generate quite decent profit, and as you can see also the EBITA percentage increased to decent levels. But it's also important to mention that already in 2019 we spent significantly more money on product development, so we were investing for the future, that's a long-term mindset. But still we managed to generate profit, so that's actually a very strong result in 2019. The next phase we call innovation investment, and already started end of 2019, but the development and spend into new products continued. Of course we focused on growing the business, becoming more sharp in our application of all of these things. But unfortunately, if you remember in 2020 the pandemic came, so we were really struggling to get going. Our sales approach of meeting customer face to face, demo the instrument, showing examples got kind of taken away from us, and we could see that revenue decreased significantly. But despite a very tough year, we managed to keep profit up, and in this case the EBITA percentage got extremely high because some of the things basically we couldn't do. But we also did something very fast in 2020: we switched the approach of meeting face to face to a more online-driven sales approach with webinars and seminars. We were on one channel, the distributor were on the other, and the customers were on the third part, and we managed to demo our equipment. We had a lot of like video cameras in the lab showing experiments. But as you can see, already in 2021 we were not back on track but we had significantly grown the business on top compared to 2020. And what can I say? During this period I am personally extremely proud because the organization, like many other companies, really struggling, but managed to generate this during tough period is something that I'm personally very proud of. But what also supported this, that we started the product development and then in 2021 the first product with industrial focus came out. So it was an Attension product called Theta with the mindset of one design and industrial usage. So we started in 2020 and we kept this promise that we set in 2019 to launch one new product every year. So moving into what I would say a global expansion phase, and that's where we are at the moment. So you can see the goal was to keep the EBITA percentage but start growing the revenue stream with an increased profit expansion. And 2022 was this very strong result, and 2023 has started extremely strong. And now we have a very interesting launch ahead of us for Q4. But this is not for me, this is for Kin to talk about what we're doing right now but also in the near future. Yes, thank you.

Yes, thank you Matias. So, as you can tell, surface science is a quite complex area, however it is very essential in product development in many application areas. As I told you, our long strategy is to improve our footprint in the industry segment for the years to come in strategic application areas on a global level. We have a strong history and we have a well-established global customer base in the academic field, and this is of course essential for us as we penetrate the industry segment. From a market perspective, rest of Asia and Pacific is the fastest growing market for Bioline Scientific over the years to come. We will increase our investment in rest of Asia Pacific to accelerate the market penetration. Key markets are of course China, Japan, Taiwan, and Korea. Several of the key application areas are driven from high-tech companies in the region. One strategic action that we took this spring is that we have broadened our collaboration with DKSH. DKSH is a company based in Switzerland and they have more than 150 years of distribution experience in the region. So let's talk a little bit about the tensiometer market and the Attension portfolio. The tensiometer market is a well-established market with a few key players, and in most of the countries and regions Bioline are number two already today. About 40% of our Attension business is in the academic field. Next step is to broaden the portfolio based on M&A activities, and we have identified potential candidates to be evaluated, and these candidates they have either regional or global presence. You can tell from the pictures below, which you already mentioned Matias, that the portfolio presents a nice aligned design language, and we are very proud that we've been awarded a Red Dot award several times for the portfolio. Let's move on to the Q-Sense business. The strategy is slightly different for the Q-Sense portfolio. The portfolio is mainly driven by internal R&D resources at Bioline Scientific. The competition is limited, and it's really in our hands to further develop the market. Bioline Scientific is number one in this business. As you can tell from the history, the launch of Q-Sense Omni is in line with our design language, and this instrument provides the features and benefits as required by our industry customers. For this target group, reproducibility, result, and reliability are key. We have a strong track record as I mentioned in the academic field, and the technology is well used in many well-known institutions with a strong reputation, and that is important now when we enter the industry field. We also have a well-established global distribution network in place, and they have the capacity to drive the market penetration in the various application areas. The Q-Sense portfolio and the launch of Q-Sense Omni is driven by internal R&D resources, and the Q-Sense Omni is our enabler to really improve our presence in the industry segment for QCMD. The technology has been developed at the latest hardware and software environment, and that gives us the opportunity to further develop Omni to the customer needs today and the customer needs tomorrow. I would like to end my presentation by sharing a short video. I hope you will get the sense of understanding that Bioline is really in the forefront when it comes to surface science, and I can promise you that our future is super exciting and bright. Thank you.

It enables you to unfold unique insights quicker and base your decisions on more reliable results from highly controlled measurements. The smart guiding tool makes it easier to mount the sensor in the right position. Together with the automated and controlled clamping of the sensor, this prevents experimental failure, unwanted variations, and maintains the acoustic fingerprint of the sensor. The unique measuring chamber provides a stable environment with controlled conditions for reproducible results. The clever automation features minimize hands-on time and unwanted variations. By upgrading to more channels or adding Q-Sense Orbit for alternative experimental setups and complimentary measurements, you can easily go beyond entry capabilities and grow with your research. This stable environment, background quality controlled setup, and automated procedures all work together to ensure successful measurement results free of unwanted variations, providing you with a smooth journey to trustworthy results.

Now it's time for our first Q&A. And for questions, please use the QR code provided, and all questions will need to come through digitally. Maybe we should start then with one here. We have one for our CEO: 'You reiterate that your target is to grow EBITA by 15% per year. Is it possible to do so in 2024 as contributions from acquisitions will be lower in 2024?' And it's Carl Nordin from... who asks.

Well, thank you Carl, good question. So to start with, we don't give specific outlook year by year on what we hope to be able to achieve. But of course we have just now reiterated our financial targets, so this is what we will be shooting for, and we think it is realistic. Thank you.

Uh, and then we'll ask Christina one regarding Eurobar. If the ECB now holds the rate flat, meaning that we are at peak rates, will you manage to stay on the right side of the ICR covenant of more than four times? This was Gustav B. from N. who asked that question.

Uh, and then we have another one for Fredrik with regards to working capital and cash flow improvement in light of a seasonal weak Q3, not least in Europe, with holiday seasons taking place during this quarter. Would you like to help us set fair expectations from when that working capital release will come through in the cash flow statement? With Q4 a seasonally strong quarter, is that when you should expect that working capital release to materialize? And this is Matias H. from...

Thank you Matias, good question. I think it's a good observation that indeed during the summer months, in particular when it relates to elective surgery, that is normally a fairly weak month, and that also translates into a weaker cash flow normally, and in particular in July and August. Also we can use as a guidance the previous year where we also saw that Q4 indeed was a stronger cash flow quarter than Q3. So I think it's reasonable to expect a similar pattern this time as well.

Maybe one for Christina. Can you talk more specifically about what exact targets you have set for the largest five companies that account for some 75% of inventory? And are you expecting to come down to other levels to around 13% as in 2019, like 20% as of Q2 LTM, or what is sort of a reasonable long-term level? And that's Gustav B. from N.

Yeah, then we come back to some of the targets and discussion around performance. And I ask you, Peter, in a decentralized business model as we've talked about, how do you really implement this Johansson analysis?

Very good question. I think as I said, this is one of the most important tools really in AdLife. And at least all companies does it once per year, and that around the target presentations. But some companies do it really on a regular basis and even on a monthly basis, really to follow, especially new companies, to follow and see, is there unprofitable business that we can tail cut? So I think that it's really something that we use a lot. And also supported by a business controller in AdLife that helps the companies out there to make these kind of analyses if they need that kind of help.

We still have one here from Carl at... to working capital: At exactly where 45% adjusted for reversals, do you believe it will increase going forward?

Who wants to take that one? Well, I think I can start a little bit again. We want to be very cautious about giving precise guidance for the future; that is not something that we do. I think it's fair to assume that we are going to improve from the levels that we're currently at, given all the efforts that we're driving and the exceptional period that we're in right now when we have seen a strong acceleration in the growth in particular in the med area. That of course ties working capital, that's understandable. So an improvement is realistic, but we will not give a detailed guidance.

I also have a question here on AdVision. It would be really interesting to hear more about AdVision: what are sales and margins right now and what actions are you taking to improve margins?

Maybe you want to elaborate? I can speak to that. So AdVision has been an area of strong focus for us for a long period of time, and I think it has accelerated during this year. We have made some changes, we have a new board in place for example, and we have done a thorough analysis of that business. I want to start by saying it is a good business to be in. Ophthalmology is a great market segment with positive growth projections and good profitability normally. As many of you know, when we acquired the business it was at a certain fairly high margin level, now it has declined. So we are now at low single-digit margins. The revenue is roughly unchanged around 70 million euros or so. We have done a number of activities there that I mentioned earlier on in terms of updating the sales force and so on. And now very recently we have taken some strong efforts to actually reorganize the group. We want to organize it in a way that we empower the local teams so that they can be agile and nimble and respond to market trends in a more quick way. And with that we are also significantly reducing the cost by removing a number of centralized functions. So this is a change in alignment with our strategy and culture that will reduce cost but more importantly drive the business towards profitability improvement through a more active commercial work.

Working capital seems to be a popular item this morning. I still have one here for... working capital: is it fair to assume this being a positive figure for the full year 2023?

Well, again we don't want to give a detailed guidance, but I think we're very confident in saying that we are expecting an increase in the cash flow in the second half of this year, starting in Q3 most likely, and even more pronounced we expect in Q4.

I also have one question here from Marcus R. Do you expect there will be any need for platform ERP investments to more in real time follow the efficiency work on any larger logistic investments to increase efficiency given the 18 million SKUs and diversity of operations? Or are you happy with the more historically decentralized structure?

We will by all means stay with the decentralized structure. No centralized ERP system for sure. That is the completely wrong way to look at things. We want the companies to drive their business based on their local knowledge, their product knowledge, the deep understanding of the organization and culture. That is working really, really well. We support them in that of course, but we will not drive that from a central level.

We have Alan from... again on AdVision. What margin level should we expect AdVision to reach and when?

So thank you, Alan, for a good question. As many of you remember, they were in the range of 15% EBITA margin when we acquired them. They have dropped now to single-digit margins unfortunately. We hope that that will recover and we think it will, but we want to be really careful by saying that is not something that happens overnight. This is a long-term effort, so you know eventually I'm confident we will reach similar levels, but that will take time.

We also have a question here from Eric B. on Lancelot Asset Management. On what types of returns do you get on capex and placing equipment at customers? Is capex reduction a potential lever for cash flow improvement?

Yeah, I guess I'll answer that. Well, thanks everyone, very, very active questions here, we like that for sure. So, well capex is still a very small part of the business. We're a very capex light business as Christina showed. It has come up a little bit but not nothing dramatic in any ways. Of course we're always looking at that, we're always optimizing, but we won't do anything drastically. You know, when we sign up a new customer or new hospital for example within MBA that Carlos will be presenting later, we're super happy with that. Of course we're going to support them in responding to their immediate surgical needs, so of course we are going to have consignment stock close by. But of course we can always optimize. We're also really, really good at quick deliveries, and we can analyze the business in terms of what are the products that are actually being used frequently. And Carlos's team is doing an excellent job in that, so we can always optimize. But we're not going to abandon that idea and we're not going to strangle the very, very positive growth momentum we see now by being too strict on those things.

But is it at risk that management focuses too much on the larger subsidiaries and to some extent not have the same focus on the smaller ones? Or how do you mitigate this happening? Would you like to... that's Carl from... Oh, good question. Maybe do you want to start with that, Peter?

Yeah, I can start with that and you can then continue. I think it's quite clear that we're working with all the companies. Of course the focus now is on the big ones, you know the 75%, but clearly I think everybody has to contribute in the way that they can. So I think it's without doubt a part everybody should be part of that.

I think it's well said, Peter. But of course some of the larger companies are also fairly new in the group, so of course there is more work to make sure we are aligned on every aspect of cash flow improvements and so on. That is why we have an extra focus on that right now. But you know, of course we are also supporting the smaller companies. The smaller companies can also be a very nice role model as we saw right with Triolab in Finland with the fantastic efficiency in working capital. That's a great role model for all of us to look at.

So please continue to send in questions to the second part of the Q&A which we will have at the end. And I think it's time for a coffee break now, and please be back at 10:30. So please enjoy some coffee and please don't forget to send in more questions. Thank you. Doing a pretty good job, right? Thanks, Helena. Thank you.

Okay, there are many, many, many words that define for us NBA. But if I have to choose three, four: maybe trust, maybe commitment, maybe kindness, maybe professionalism. All the time, every time that we have demands and requests and meetings, at whatever, always NBA are or is available for us, not for us like patient organization, because they understand that behind us are patients. But behind the patient are lives, and this is the most important thing that has clear and present all the time. I speak on behalf of all patients with skeletal dysplasias who from NBA work and service the constancy and interest to improve the quality of life of the patient with skeletal dysplasias. I think are the best values the company has.

My name is Matias Kell. I am a research manager and a senior principal scientist working for the German chemical company BASF. I have joined the company 10 years ago. I have worked ever since in central research. And Bioline, especially the Q-Sense part of their products, has been a vital part of my work since day one. So we're doing advanced surface science to develop materials and system solutions for the next generation. BASF has a broad range of products that go into all sorts of markets, all the way from agriculture to personal and home care products to performance materials. What I appreciated from day one on was the quality of the Bioline instruments. They are quartz crystal microbalances. They are best in class in my opinion, both in terms of sensitivity, robustness, flexibility, throughput, and many other positive factors. We are on a very good way of further innovating together, improving with our input as expert users the instruments of the Q-Sense branch. And I hope that this will continue in the future to bring surface science and in particular the quartz crystal microbalance further ahead.

The benefits of using the Q-Sense Omni system is that we have the... of technology where the clarity of the system is very very important for us, and we can individualize every step of our work, which is a tremendous value. We can do a lot of stuff that we couldn't do before. So for us it's a big step at... municipality. We feel that they listen to us, so we are very happy right now that we have a good communication.

And the team of Healthcare 21 are always on hand in the rooms, supporting us, helping us with every aspect of the care of the patient, and in particular guiding us to use the equipment and the accessories which has been fantastic. So we deliver several courses at King's College with the support of the team. This has always been exemplary in terms of its organization. So I think the delivery of these meetings is really a joint effort and we couldn't do it without them. So we're completely satisfied that the products that we're using are used well to the best of our knowledge and used safely for our patients. So that just shows that this is a very caring team that does best for patient care.

Welcome back after the coffee break. We will start off the second part of the day with a panel discussion. I have invited the following to the stage: Tara Kearney, former CEO at Healthcare 21, the largest company within AdLife, and she is also a chairperson to two of the larger AdLife companies. Then we have Jyrki, CEO at Triolab Finland, and he is also covering the diagnostics within AdLife. He has been with the company for 20 years, something like that. And then we have Carlos Pinto, CEO of MBA, and he will talk later, have an own presentation. And you've already heard Kin Fisher, CEO of Bioline Scientific, and also Peter Simos Baka, CCO at AdLife. And please be free to send in any questions that you have using the QR code. So let's start with the first question. What do you think are the advantages of being part of a larger group such as AdLife? Maybe you, Tara, want to kick off with that one.

Thank you, Helena. For me, with AdLife from the minute we met, from their first meeting, it was the cultural fit, the synergy of culture. And I know Frederick mentioned culture when he started out earlier today and how close it was to his heart and how strongly he felt about it. And I have to say I feel the same way. And just to see how aligned we were in culture, in values, it just was phenomenal. That combined with the decentralized model, the devolved ownership with accountability and responsibility, because when you're selling your business, you... it just was phenomenal.

Price has to be right, it has to be fair, but you're always, that's it doesn't stop there. You're really looking for a long-term owner, an owner who is going to continue the growth and the success that you've developed in the business. And it's not just the business for me; it was about the people, the growth and the development of the people. And Peter, you mentioned the AddLife Academy and what that does in terms of supporting and developing people, and that's just one of the areas where AddLife adds value. And I suppose the other advantage for me when I look back is AddLife got it. They were an expert in life sciences, they knew what it was, they knew our business, they knew how to drive the market segments. And again, Peter, you mentioned the tools that were there and the support. So you really believed in the model that was there. And to be perfectly honest, two and a half years later I can sit here and honestly say that expectations were met, they were exceeded. And Healthcare 21 today continues to flourish under AddLife ownership. Do you, Carlos, have any additional perspective to this?

Yes, thank you Elena. I'll take the long-term owner. Being part of a long-term owner for us, MBA, has allowed, certainly is already allowing us to look further with a different stability. For us, a long-term owner with a very powerful network, we just joined the company last year. I don't know how many meetings we have already with the other companies, Healthcare 21, Med Plus, and some other companies that really help us to look out of our frontiers. We were an Iberian company, very proud to be an Iberian company, but now we are part of a larger group, and that will be very important for us, MBA, to also have a long-term perspective in terms of profitable market share.

If we go over to the next question then, how does being part of AddLife actually improve your performance? Peter, maybe you want to start and shed some light on this issue.

Yeah, I would say that there were clear and consistent targets and also close cooperation with our distributor, our companies actually in the group, has really helped us to achieve a great performance, strong performance development the last few years. I think also very much linked to that is of course the AddLife Academy. Because due to the fact that we're training our employees in improving their skills and also being a higher business acumen in that kind of thing, I think that had a huge impact. Do you want Ken to continue on this one?

Yeah, I mean, I'd like to support long-term investments, and that's key for Boline Scientific. We develop the customer offer in-house, and then you need to have an owner that really believes in those investments. But also talking about bold decisions which we did, Matias and I earlier today. I mean, when you make those decisions, as for Boline Scientific, when you decide to close down the U.S. entity, of course you need to have an owner behind you supporting that. And despite we have had to change the business model, today the U.S. is one of our strongest markets, very profitable and with very sustainable growth. So we have established a very good relationship with our partner in the U.S. Yi, what do you say on this topic?

Well, thank you, Helena. As we have heard today many times, AddLife has a strong focus on profitability and operational efficiency. And as our company has been part of the group since the beginning, it's kind of already part of the DNA of people to always think how we can improve our processes, become more efficient, and how especially we can positively contribute to the key KPI profit over working capital. And as you, Peter, presented, thank you for that, a nice sustainable profitable growth curve of the company. Yes, but it's only possible when we base our decisions really on profitability, whether they are sales driven or opex related, working capital related. And there we have got a lot of support from AddLife all the time. But it's teamwork, everything is teamwork, so the whole team needs to be committed on that. And like Peter you said, the fine tuning, that our people all know how they can affect working capital, so that's been a lot of trainings related to that and so on. So it's long term. And like for me, as being a long time in the group, it's great to see that new companies entering the group and to learn from their best practices around how to improve performance, efficiency. That's really a great value for every company in the group.

So going from performance, then how do you keep the dynamics and the flexibility and the entrepreneurial spirit of a smaller company while being part of this large European group?

Well, we work with very sophisticated and unique products within healthcare and life science, and in very different market conditions. So if I take an example, as I'm responsible for Finland and the Baltic countries, if we look at market environment, business culture, competitors, their strategies in Finland and compared to that with Estonia, Latvia, and Lithuania, they are completely different. So we need a lot of local knowledge to operate in that environment. So even though AddLife does have extremely a lot of business understanding, market intelligence in the headquarters, I would say it's the decentralized model that is really the key to the success. When we can decide ourselves locally based on the information we have in the teams, we can actually be very agile and fast in making the decisions. And then the outcome is that we are a few steps ahead of the competition, and those are crucial steps quite often. And I would also like to emphasize that from the motivation perspective, the decentralized model is excellent for the whole company, the management and the whole team. When we have the freedom to decide important business-related decisions locally and of course carry the responsibility of the consequences, it really increases commitment. And in the end, it's really great if you deliver good results to say proudly that it was our team who really did it. That's how I see it. Well then, Karen, how do you see it?

Well, I can more or less just echo what you shared with you. But I think, you know, in our day-to-day life, the companies are different, and we utilize the fact that we are a small, very flexible company. But when a decision needs to be taken, I mean, we have one strong owner, very competent owner that will guide us and help us, so we can execute accordingly. And also, as you mentioned, you see the fact that you belong to a bigger corporation where a lot of know-how and experience, of course, very valuable, not just for me as a leader but for the entire company on our growth journey.

Peter, do you have an additional angle on this one?

I would just like to say, fantastic. I mean, you really nailed it. I would say that our decentralized approach really gives opportunity to empower our management team, local management teams, really give them the responsibility and also the mandate to act. I think this really makes them really aware that they can take decisions close to their market, they have the understanding of the customers. And I would say a very good example of that was really when I was running into the pandemic in the beginning of 2020. They really were acting fantastically. They were jumping on how can we source, how can we get actually this COVID test in place, assuring that we could supply that to the society. And without that, actually society was only having that kind of tool to control the pandemic; that was the only way to do it. So without these kind of tests, I think there would be much, much more suffering in the societies. Now we've discussed several topics already, but what about the major commercial advantages of being part of AddLife? Maybe you want to start on this one, Carlos?

Well, definitely, when I mentioned earlier the network that AddLife has in terms of the companies, not only in the hospital medtech side but also the labtech disability that we have, when we were discussing the opportunities among the business, also efficiencies among the business, that's definitely a great advantage for MBA. Now being part of such a group, we will be able to benchmark not only in terms of segments but also in terms of our strategy that I will try to show, at least to share later. And that we want to diversify. Now it's much easier because we get the contacts with the other companies that have other suppliers in different niches, and we are seeing a lot of opportunities right away for the next year to start participating in new niches, diversifying our business with the experience that we have within the group. So definitely must. Do you want to finalize? Do you have any final comments, Tara?

Well, I just have to follow on from Carlos there. For me it's really about the scale and it's about the expertise. It has to be like, if you look at what AddLife is today, we are a pan-European specialist in the life science sector, so that just brings the scale in itself. And I can probably speak for everybody sitting here today: we all share the same passion, the same values, the same driver of growth first and foremost obviously in our own organizations, but now for AddLife as a group, because yes, we're a collection of companies, but we're now thinking like a group. And I think that's what's coming together. I think as the acquisitions are bedding down, and that's just the mindset that's been instilled. But for me, if I just look at the customer testimonials when we started, what are we here for? We're here to make a difference. And looking, I'm humbled when I look at those testimonials and seeing that Fredrik mentioned, or the vision of the start of his presentation, making a difference to people's lives. And that's exactly what we do all day every day. And how we do it and how we deliver it is through our products, it's through our services, it's through that delivery, it's through going that extra mile. But for me, the magic ingredient in all of that is the supplier partnerships that we all have, because that long-term relationship building, and for me now being part of AddLife, is enhancing that and adding to that. Because we can now bring to our suppliers more territories, more expertise that we all share as a group, and then that will deliver more products. And I think the scale as well of the organization just allows us now in terms of bringing more into the organization. That, combined with the skill and the expertise and the knowledge sharing, will be able to keep making that difference, we'll be able to keep on making the promises to our suppliers and living by them. And I suppose, looking at everybody here that's joined us and spent their time this morning, also delivering for our shareholders.

Well, thank you very much for these fantastic reflections. Now let us see if we have any questions from the audience. And I actually have one from Redeye here from Eddie Palm. Curious to hear more practically how you are incentivized by AddLife to improve your specific businesses. Maybe you all want to start? Maybe you want to start? Do you want to start? Yeah, you can start.

At the incentive scheme, bonus scheme for our MDs in our companies, it's really based on what we talked about, this performance matrix as a basic. Because it really depends on where they are on that kind of scale and what is the most important thing for them to focus on to really improve. And then it's based to make that kind of improvement. So it really goes hand in hand with our key KPIs, and that I really like because then they are aligned with our targets. So I think that really works well. Yeah, I do. I think it's a very solid process. You know, and then of course this is cascading down in my company and follows the KPIs that have been approved and decided together with AddLife management team. So I think it's a very solid process for all the companies.

I have one here too. What are the advantages of having a long-term owner like AddLife? And maybe you, Yussi, who is long-term, want to comment on that one?

Yes, really long, really long term. Well, I think the key value is really on giving security to the organization, safety to the organization. Kind of we know that we have a long-term owner who wants to develop the company together with the management and the whole team. And we are working with products and customers with very long contracts, and we cannot have short-term strategies. It's a long-term strategic work, so it can only be supported in the right way with a long-term owner as well.

But then if we go to the next one, from long-term to how AddLife can support you in sustaining and extending your company's existing competitive advantages. Would you mind to discuss that, Carlos?

Yeah, as I mentioned earlier, the expertise that AddLife has, not only because of the companies and the network but also because it's a long-term owner, will help us to evaluate better internally, to realize our reality in a different way. And again, with the resources of the company that we have locally, we'll try to understand and benchmark to improve our efficiency. Today my name was mentioned several times of the efficiencies of the company, and I'm proud of it because I think being part of AddLife, we will be realizing certain things that in our own reality we were not. And that's definitely a must, and that's definitely very positive and promising for our future.

So once again, thank you very, very much. And now it's actually time for you, Carlos Pin, to give us an insight into MBA. Please, Carlos, the stage is yours.

Well, first allow me to just say that this is really an honor for me to be here and represent the excellent and talented team of M-B-A. Good morning. I will try my best to share our values and our strategy, at least to introduce the MBA company, one of the newest companies in the group. So who we are: MBA Surgical Empowerment. As you see in the map, I would like to point out the biggest dot on the top of the Spanish map, that's where we were born. So we are a Spanish company, leading distributor in medical and surgical technology. I will talk a little bit about our history further. We offer innovation, we want to add value to the market. We are covering both Spain and Portugal, and of course in the healthcare sector it's important we cover both public and private sector. And why we think that we play differentiation? Because we always are focusing on bringing the most innovated solutions to the market. Our main priority is our people, because it's through our people that we can really deliver excellent customer service. And that's in that origin. So our strategic priority is always moved by the differentiation in service. You will see that service is critical for us. We are a distributor, we are not a manufacturer. In marketing also, because some of the suppliers that we represent are excellent suppliers, but they rely on us that responsibility and in promotion through a magnificent team that covers both Spain and Portugal. And from where we are and where we are going, as we say here, always in our strategy we are moving towards the high value segments. This is where we want to go. Just briefly about our history, I think it's important. Three main phases stand out. The first one, of course the creation of MBA. MBA was born 35 years ago in Esteras Unidas, for the ones that know it, it's up in the north. It's considered nowadays, it's curious but it's considered a healthcare cluster because MBA was born from other companies that were already there. And it's an interesting part to see from the company because the environment that is surrounding us, university and hospitals, also helped us to grow as a company. But at that time, MBA, the aim of the company was not to be a distributor, only distributor; it was much more than that. It was to be a distributor that could bring different technology to empower our health professionals, at the same time increasing the access to healthcare for our patients in Spain. Throughout most a decade, MBA extended its capabilities throughout the Spanish market, our core market, and we've been able to later expand MBA because we thought that with the capabilities and the infrastructures that we have, we could extend our footprint. And later we expanded to Portugal and also to Italy. After the second phase, and this is important one, after a decade and a half of the 2000s with a lot of economical turbulence, a lot of changes not only in terms of Spain and Portugal but also in terms of the European market, MBA took a very important decision which was taken in 2015: change of management, change of strategy. We were a company pretty much focused in several high volume segments, and we did think that we had the resources and capabilities to start to move towards the high value segments, to start to differentiate ourselves as a company. And that took us to the third stage, which I think is critical for us. Because throughout these years, the well more or less I may say seven, eight years, we've been making a successful track record. We have an extremely growth trend. And we finally reached a stage where AddLife acquired MBA. This is important for us. We mentioned already long-term perspective. This is the way that we work in the market, not only towards the market but with our suppliers. And finally we became an Iberian company.

As an Iberian company, it's important to dedicate and invest a lot of resources. As I mentioned, we are a distributor, we are not the manufacturer, so we need to differentiate ourselves in certain areas to really cover the market. Our aim is to cover the market in Spain and Portugal. We want to be everywhere through our specific segments where we are focusing, but we want to be everywhere in serving this market. It is key for us for our mission. So bring differentiated, innovated technology for our health professionals, allowing to increase the quality of life of our patients. And what we have built throughout these years enables us to be part and to participate in more than 50 hospitals in the Iberian region, which is the majority of the hospitals that cover our segments. And also a very impressive number: we have more than 14,000 doctors using our products. This is possible because first of all we partner with some of the best suppliers in medtech. That's the only way of bringing new technologies. Then we are able to partner with those suppliers, and then we are organized through three major divisions: the first one orthopedic and trauma, neurospine, pediatric orthopedics, and anesthesia and surgery. Those divisions are the ones that drive all the solutions and all the services that we need to cover. So we really understand how each division can create synergies within. We really understand how these solutions work within those divisions. And with the powerful help of some of our suppliers that have been with us since the foundations, we achieve market leadership in three important segments. In the break I was showing one of the products of one of these segments, pediatric orthopedics, and you saw the video. This is one of the areas that we can say we are market leaders in both Spain and Portugal. And that is possible because we developed a partnership with one of our important suppliers since our foundations, so their brand and our brand is the same in the market. This is the only way that MBA sees that we can evolve in the market, looking to the market needs, looking to our suppliers, and how can we be the same in the markets. This is interesting because these kind of market shares that we have in these segments are only available usually for some original manufacturers, and we managed throughout the years to achieve the market leadership in these segments thanks to our teams and thanks to the suppliers and their commitment, and of course both committed in developing the market. We are establishing two new divisions. Why is that? Emerging technologies are reshaping healthcare in multiple ways. So we are seeing what is happening in that trend, or we will be out. What were we doing right now? So we have to take into consideration first how this technology will be accessible to the health professionals and to the patients. Secondly, our suppliers and distributors can deliver this type of technology to be accessible in the market. And third, how the patients will benefit from it? What are the outcomes of this technology in the future? And this is where MBA is right now: bringing new technology, cooperating directly with the health professionals and patients to really evaluate the outcomes. And this is where MBA is in terms of future development, future business.

So why we are a unique partner, and we consider ourselves to be a unique partner if you allow me? Four pillars. First, the talent. I mentioned already our people, it's the most important asset that we have in the company. Second, the training. Third, customers, of course I may say customer always comes first, but it's a third pillar, very important pillar. It's important also to understand some of the layers of the business. And last but not least, the scientific development and the commitment. All of those are related to our long-term commitment as a company. I will mention internally first. Talent: our people, our main priority internally. It's very important to provide the best conditions to our people to develop. And we think that one of the keys is education. Just an example: throughout COVID, as you know, suddenly we had the majority of our people in an empty space, and we took a decision that it was the time to improve their capabilities. All of our staff stayed active, we provided and supplied more than 3,000 hours of education and training that year. And then when we restarted in the market, we were like speed. We were one of the fastest companies in the Spanish and Portuguese market at that time because we were prepared. We invest in education programs. Under AddLife, there is an advantage nowadays because there were some capabilities that in terms of technological capabilities to bring those capabilities to us, the investment was a bit high. And now we are part, we have managed to access to a learning management system which is SAP and AddLife, and we are increasing the effectiveness of our internal education programs. Training of course is really important not only internally but also externally. That's what we were mentioning: our customers, we need to provide them all the information, all the education that they need to perform well, they need to really improve the quality of our patients' life. And on that case, we established several channels of training. MBA is really a benchmark in training in the Spanish and Portuguese market. Why is that? Because it's not only provide training, it's the way that we provide training. We have surgeon to surgeon training, we have specific medical education programs that we've been investing for many years now, where we can use reference key opinion leaders from all over the world to participate on those programs, because they really see themselves in a very high quality programs. And then the MBA on air, which was an invention from COVID, which is a web-based training that allows the surgeons, the residents that they work most of them 20 hours a day, that can train while they have a break. They can use the online facilities, they have access to that online base to most of the most important references in the world in specific segments. So training is key internally and of course externally. And MBA provides training to more than 1,500 surgeons a year, which I think is a number that if you compare with other companies will be on top of it.

Customers: so our customers, what they expect from us? We have already delivered innovative solutions, we already delivered the best service, the best care. They need this. They need more than we prove that we commit with the service. What they need is that the service, the needs, the way that they work in a hospital, as you know it's a huge company, not sometimes the best organized company, so we need to be fast, we need to be agile, we need to be immediate. So for that, we are considered to have the top level service in the countries. 95%, more than 95% of the orders we can deliver within 24 hours, and some of the urgent orders we are delivering in less than four hours. For that, of course we have infrastructure in place, we have inventory in place to really deal and to really serve on their needs. That's critical, and that's one of the biggest assets that MBA has. And the other one, the MBA Institute. MBA Institute is one proof of our long-term commitment. So we are bringing new technology, we are bringing innovation technology, we are training surgeons and so on. Now, as an example, bringing new emerging technology that's helping to improve the outcomes and the quality of life of patients. But suddenly we have to be here in the future measuring if that technology is really aligned with the outcomes expected. And there is no better way of doing it than participating in those outcomes, in the way that we evaluate, we take data. So MBA Institute was created back in 2010. It's a perspective of long-term collaboration with scientific and clinical research. So if you go to Google right now and input 'MBA Institute', I invite you to do that, you will see a lot of clinical papers in the most important medicine journals with the support of MBA Institute, a lot of multicentric studies, important multicentric studies with support driven and helped by MBA Institute. This is really proud. But better than that, and the numbers speak by themselves, is to show the numbers when you talk about research support, the popularization of knowledge. This is very important in healthcare: it's that you have the knowledge but the knowledge can be spread out. MBA Institute is a very powerful tool right now in the most important congresses in Portugal and Spain. You will see a lot of papers, a lot of presentations, a lot of researches and a lot of clinical evidence that were made possible because there was a foundation, an institute that was behind helping to make that happen. And this is really one of our signatures when we talk about the medium or long-term commitment of the company. So we are in the present, supporting the present, bringing new technologies, bringing access. But we are here also shaping the future. We are here to expect that the outcomes that we are promising now will be possible in the future, and being responsible for it.

Well, trying to explain a little bit of our strategy. At the beginning, what I was saying: we were a company much more on the high volume segments, and now we are moving towards the high value, high margin segments. How we started? Of course we started as an orthopedic company. We were playing high volume. It's important to play the high volume, yes, because if you are not playing the high volume segments, you are not perceived as a company, as a partner for the high value segments. And that in medical as an example, if we're not playing the primary and elective surgery, you will not play the revision and the complex surgery, because they will not perceive you as a trustable supplier. So again, you see products, but here you see solutions. You see the disease statement. That's where we focus. We don't focus in selling plates and screws for trauma; we focus in trauma. We don't focus in selling particular screws for spine; we focus in spine. So everything that we do, we do to improve the quality of life of the spine patients. So coming from the left where you see lower margins, definitely higher volumes, but needed to be there. If we are not there, we cannot play on the other segments. We start to move to the right side. We have a much more diversified pie. Our pie 15 years ago had two, three colors. Now we say it's a multicolor pie, much more diverse, much more strength, much more resilient portfolio. And the future is expansion. And the expansion is going towards the right top quadrant, which is participating in areas where we think we can add value. We will not participate because it's trendy; it's because with our structure, with our resources, with our capabilities, we can add value, and we know that we can add value at this level. So this is more or less I tried to resume in this slide our strategy and our road map and where we want to go as a company. And hopefully we reach this very soon, and hopefully we'll reach this faster now under AddLife, because now under AddLife we have access to a lot of suppliers that some time ago we were knocking on their door and they were not so interested in listening from us. Now they are much more interested in listening from us. And some of those suppliers were working with some other companies of the group, so definitely everything is aligned with the strategy that we've been building for more than the last 10 years.

Well, just for ending, talking a little bit about the market also to show how MBA can differentiate also in the market. In a way, as Fredrik mentioned, fortunately one of the good tailwinds this year is the recovery of elective surgery. We are still not far, but we are going fast to 2019 level, which we consider the normal level. But at the same time, as you see, there are some increasing in the waiting lists, but this is good news. Elective surgery is recovering, the activity is getting to normality. On the right side, how we MBA can really help our markets to grow: because when you look to Spain as an example, but this is our core market, Spain's healthcare is not centralized; it's by communities. And you see this example: some communities are already green because they are reducing waiting lists, some are pinkish, some are red. We have to understand that each community has its own reality, each community needs to have different tools to really improve the quality of the patients. And that is where MBA can really bring the effort, because we are present in all the communities, we know how each community works, we know really deeply the profile of each community. So when you think about MBA, think about the company that has really fitted to serve as best as close our health professionals, always to improve the quality of life of the patients. And nowadays, I'm sure that under AddLife we really have a very promising future. And talking about future, I hand over to Fredrik, who will bring us some more about future and strategy. Thank you so much.

Thank you, Carlos. Well done. Excellent. All right, so let's continue. So Carlos did a fantastic job, I think, to talk about the value that we bring to the patients and improving the life of the patient is really something we are passionate about, as you can tell from all these discussions. So big thanks to Carlos for a great presentation, also to Karen and Matias for a great presentation, and of course during the Q&A session here, I think that you got some good contributions and better understanding of the business from Tara and Yussi, so a great thanks to Tara and Yussi as well. And of course Peter and Christina providing great insights into the financials and how we run the business for continuous improvement. So now we're going to talk a little bit about the future. And I think the interesting thing here is of course that the starting point is very exciting and very strong. So we have started to work on a new, updated strategy within the group, and this work started actually already as early as July of last year. And it has been a very thorough process, engaging from the get-go all the companies and leveraging their expertise, in particular in the areas of what are the most interesting segments that we can drive, what are the most interesting geographies and so on. And then this has been a process over the year to evolve that strategy and define it and communicate it internally as well. The starting point is really a very, very strong AddLife. We are now a broader and stronger business. We have a much bigger MedTech business, active in many, many more segments. We have a European coverage that's much strengthened, as we have talked about earlier today. And this gives us many, many new opportunities and also a unique stability. So with this increased exposure to a number of new segments as well as a number of new geographical markets, we have a very promising future. So but of course most importantly, it's the team that delivers this. And that's why I'm so happy today that you've been able to actually see and interact with many of our very strong team members. We have an amazing team of dedicated, experienced, and energetic people. And the picture you see here is from the meeting we held in May of this year, gathering all the managing directors and their key management team members from all companies within the group to go through our business status and our strategies for the future. So we have a great team, and these are the people that are going to deliver on this plan.

So we start with looking at a little bit of the market trends, and then moving on as well to what is happening in the competitive field. So looking at the market trends, we've talked a lot about it. The post-pandemic environment is here. Elective surgeries are recovering in a strong way. It is happening all over Europe, and this will be an effect that will support us in our growth for the rest of the year, but certainly into next year as well. So this means an increased number of surgical procedures that many companies like MBA but also Healthcare 21, Mediplast, and others within the group, Fisher to mention a smaller company also very strong in this area, they are able to benefit from this trend and help the healthcare system to handle these patients. So increased number of surgical procedures clearly moving forward. We also see, unfortunately, a staffing shortage. This means that there are and will be healthcare capacity constraints. So the hospital systems will have to handle more patients with fewer resources. So here we can help them with different time and resource saving methods and tools. And very importantly, as you've heard a lot about, the fact that we are very strong when it comes to the service provision that we have in many ways. And I think MBA is one of the best examples of that in the group. This can also offload the hospital system in a very meaningful way. The healthcare systems, you know, we have to realize that they have been in a special budget situation during the pandemic, so now they're getting back to a more normal situation. This will likely mean that there will be some budget constraints going forward, and we can sense that from time to time, in particular larger and more expensive instruments are being sometimes put on hold. Fortunately for us, the vast majority of our business is with a slightly smaller type of equipment, so we have seen a decrease in the labtech side primarily, but that has been more than compensated by sales of consumables and reagents. So of course with these constraints that we are seeing to some extent, and that will be the reality for some time, the focus on value and productivity selling. We need to be really good at communicating the value that our products bring and the productivity that they can contribute with. So this is also important for our strategy going forward.

If we move forward to take a look at what the competitors are that we're facing in the market, there are really three major groups. One is the global product companies, the global manufacturers and developers of products. The other one are multinational distributors like ourselves. And the final one is the smaller local distributors. So if we start with the global product companies, they of course develop and manufacture products. They have a mix normally of go-to-market strategies; sometimes sell directly, sometimes through distributors. They are for us a competitor in many of the tenders for example, but they are also a partner and supplier. What we're seeing in this market, and I'm talking about many of the really large and famous global manufacturers, is that they are shifting the focus of their portfolios to be more prioritized focus areas where they can be really strong, and they are divesting or spinning off other parts of the portfolio or finding other routes to handle these products. We also seeing that there is a lot of cost cutting going on, reductions of country teams from these companies in quite drastic ways. And this is happening in many examples that we see in the market. So for us, this represents an opportunity. We see weakened competition in terms of country-specific market support, meaning we can take market share. That is happening as we speak. It also means that these companies open up to discontinue their direct sales approach and instead go for a distribution model, and then we can be a very, very strong partner there. So a shift is happening clearly in the market which we can benefit from. If you look at the multinational distributors, very similar to ourselves in which acquisitions are a key part of the strategy. None of them though have the full European coverage that we do, and we think that is a great strength. Also, we don't see any of them having the mix of labtech and MedTech products like we do, which is another great strength that we have. So what is happening with these companies? We see that they of course have an ambition to expand into higher margin segments similar to what we do. We also see that very many of them are in a situation where there is an ownership change that has recently happened or is about to happen. This is probably for us a positive situation. There is a high risk that they will be a bit distracted and we can take market share. And finally, the smaller local distributors that we have talked about earlier, there are a huge number of those out there in the market, often owner-operated. In this environment where the financials are a bit tougher, interest rates are higher, they find some challenges with capital requirements. Sometimes there is also regulatory challenges for a small company to handle, and often times there is also a limitation in terms of the ability to handle succession and so on internally. So for us, we can take market share from these companies from time to time, but they can also for sure be very interesting acquisition targets. So I think when you look at the competitive situation, there are many opportunities for us to leverage.

Of course, in a market there is always risk and there's always some mitigations that you can put in place to handle that. So we're going to look at that a little bit. Of course we can lose suppliers. That is the life of a distribution business; that happens from time to time. We are normally very, very good at that, but as some of you know, we have seen some examples where it didn't happen in a smooth way. But normally what our companies do is to diversify, not to be too dependent on one or a few suppliers. So that is an important component. Another important component is the strong service, because that generates a very, very strong customer relationship and it also is an important feature that is hard to copy if someone, for example, wants to switch distributor or wants to go direct. And then of course, as always, we work on contingency planning, making sure that we have alternative products to bring on if we need to. Then the budget constraints in the healthcare system, the reimbursement changes. What can we do about that? Here again, the value-adding service is a strong component for us that will protect us for these things, and of course also continuously evolving the product portfolio. That way, we can continue to bring the value that the healthcare system needs through a good combination of service and leading products. There is an acquisition risk. We are a company that acquires a lot of companies. There is a risk that sometimes it goes wrong. We have to be, and we are and will continue to be, very selective in that. So with that, I think we have covered a lot of ground today. Thank you for your attention.

Okay so we received a lot of questions right so oh yes we did actually that's great we actually did one I could start immediately with one of these that you've been talking about this is a short one and it's from Carl: will you do any acquisitions before you are below net debt of three times? Quick answer yes.

I still have one other here relating to your presentation. Could you quantify the opportunity that AngioDynamics opportunity in the Nordic and Benelux as well as the MGI opportunity in the Nordics? What does it provide and could you see that there are more regions which this relationship could expand into? And this is Matias Heg from HES Bankin who's asking. Thank you, Matias.

There's also from Carl another one: after MDR and IVDR regulations, have you seen a change in companies approaching you to get acquired?

And still one: how much of your sales are now your own products? And when you did the large acquisitions you mentioned one rationale behind them was to push out more own products in the new companies' markets. How is this really going? You discussed it a bit but any further comments on it?

Good. Anyway, we have from Red Eye or Eddie P and one other: you are reducing acquisition activity in 23 and 24. How are you handling relationships with prospects companies and brokers during this time?

And then there is this one: are there any of these strategic initiatives more important than the others?

But then I'll also ask Carlos and Tara a few questions here which were relating to the discussion earlier at the panel. And one is to both of you, it's Alina at Kani who has asked Tara and Carlos: what's been the largest challenge becoming part of the AddLife group? Maybe you Tara wants to start.

Thank you Helena, great question. I think with any acquisition there's always going to be uncertainty with a new owner. For me though we didn't change anything in terms of go-to-market models, we still had that decentralization so in terms of that customer and supplier piece we were comfortable that that was being managed. I've probably put it into context a little bit, we sold the business during COVID so for me the biggest challenge really was our people. I mentioned it earlier in terms of the importance. I was with Healthcare 21 for nearly just shy of 20 years and you become from a family, you have those relationships. To then have to make an announcement of that scale, to manage and lead a business especially in the early couple of months when you can't get close to your people. But look, I would like to think that we did a good job working with marketing and comms. My thing has always been: even if there's nothing to say, you should communicate. So we communicated and we communicated and we tried to do as much as we could with what we could. But that to me was probably the biggest challenge.

I will pick the same. I mentioned already in our presentation people is our top priority, is everyone to feel part of AddLife in the beginning. We are the managers that we are in the acquisition process, so no one knows nothing about AddLife, then we introduced that AddLife acquired MBA, some uncertainty around. And then we are in a lot of different meetings participating and we need to bring this to the company and need to communicate internally to them to feel part of AddLife. So the challenge I will say it's a good challenge.

Okay, I have another one for you from B at N: can you talk about the healthcare backlogs in Spain and the pickup in surgical activity and how you see the development going forward? And also what role will private players play in reducing backlogs? And are we above 2019 surgical levels today?

Yeah, I tried to mention very simple chart but the trend, the recovery is there. Elective surgery is being recovered this year, great source of growth for the majority of the companies. But we still see that the waiting lists are growing and this is an effect that will not pass throughout the next three or four years because fortunately the society is back to the activity. If you go into Spain, you will see that the activity is there, we saw a lot of tourists this summer and so on, so the activity is there. So what we are seeing right now is that all the resources that have been invested to recover the waiting list are there. The elective surgery is growing and it's going towards the 2019 levels but we are still seeing that the waiting lists are increasing. We saw that on the maps right by the communities, we have to understand by community, but this is an effect that will remain for the last two, three, four years at least. The analysts say that the curve is going down in elective surgery but at the same time the waiting lists are pumping up. So this is something that we have to take care. Good sign: everyone is active and unfortunate for some patient that to a fracture, the companies are there to provide solutions. So as the activity is there, the patients and the procedures will be growing.

I had one other for you too: how has the way MBA operates changed since joining AddLife? More specifically the financial way of operating your business and how have you adjusted to the AddLife model?

Well, we are getting adjusted, we are not adjusted still. First of all, I think it's important because we are part of the AddLife group and all the KPIs that were presented, we are following those KPIs on our targets and objectives. We are learning from AddLife. What I mentioned previously, that being part of AddLife helps us to see other dimensions. It's a long-term owner with a different expertise from where we came. So now of course we are not still in these adjusted KPIs but AddLife is learning how a company as MBA can improve because for AddLife I think it's also a different company from the companies that they have in the portfolio. So I think we're doing a good synergy learning from AddLife, learning from the other companies. And we have already in place as Christina mentioned some KPIs for this year and definitely for the next year will be improving. But as I said, it's a way that we have to follow a long-term commitment from the companies and nothing can be done from one day to the other unless we have to understand where we are operating. Our success is due to the differentiation that we provide to our markets.

Definitely. Maybe you Tara want to discuss also this: Matias Heg from HES Banking again: what's been tougher than you anticipated when joining the AddLife group? That's a bit of a tough question to answer.

There's probably two things that come to mind. First, I suppose being part of a listed company when you come from an entrepreneurial privately owned business where you have the freedom or the flexibility when you're using social media, whatever methods or means in terms of communication, so it's probably just getting used to that. I found that a bit tough. The other thing for me was I suppose being the new kid on the block, as in the company being the kid not just me, but it was just having to fit into a wider organization which you've never had to do before. And again it was during COVID so we didn't access real people, it was all via Teams. I think it took nearly 12 months before we got together as in terms of the MDs and CEOs. But then that started to change because then that's where that collaboration, that experience sharing, everything that we spoke about earlier in the panel discussion then all started to come together.

Do you have anything to add Carlos?

I think you mentioned pretty much everything.

So there is a question of course from Carl, who wants to know the profitability by division. What do you say to that?

So then we have another to you Fredrik. There's a lot of discussions around your acquisition strategy. Could you also update us regarding your financing strategy? That is, can you confirm if acquisitions will be financed through your own cash flow or do you need to conduct a capital raise to finalize this strategy?

So our approach is to finance acquisitions through our own generated cash flow. That's always been the model and that remains the model. So we have no current plans for any other sources of capital.

So we're coming to an end but we have a philosophical question here, more or less: who are your role models in business and why? This is from Ed Parr, Red Eye. Wow, do you have any ideas?

So we are going to end this discussion now and this Q&A session and Fredrik will give his final remarks. So I leave the table to you once again.

Yeah, thank you. Thanks Tara, good questions. So a lot of questions, we really appreciate that. Thanks for your activity and I'm glad that we could also bring Tara and Carlos back into that dialogue so that's really good. So we are about to wrap up now. I've thanked a couple already our fantastic team and I really mean that, we have a great team. Many of them represented here today but of course not all the talent that we have in the organization, but very proud of this group of people and they're all very strong leaders as you can see. I also want to thank everyone who's been involved in arranging this event. So Lena and Shashin from the AddLife office, we've also been fortunate to be able to engage some members from other companies within the group. So from Healthcare 21, Joe and Julie have been very engaged and helping us with everything from arrangements and videos and of course also to Safir, Helena, and Maya who has done a fantastic job. So with that I want to move into the summary. So I think it's clear that our growth strategy is working. We have been seeing for the last two quarters a very strong organic growth. We think that is very important because it shows that we are positioned really well for the market conditions at hand and the market conditions that are coming. And it's also a very important fact and it shows that we are really a good home for these successful companies that we have acquired. So that strong growth is not only good in itself but it's also a sign of strength that the company is working really well and that we are well positioned. Starting from that growth that we are seeing in the market and in our business, then we can address the profit and the cash flow improvements that we would like to see and we are doing that as we've talked about in the presentation today with full force. And that includes of course the regular work that we do day-to-day with efficiency and improvements, our methods and tools to evolve the businesses, but also in some cases you have seen some clear actions and important moves to take more significant changes such as we have done in the AddLife business or ADV Vision business. So we are taking clear actions and we are driving the priorities all across the organization. So with the confidence we have in the underlying business and our ability to improve the financial parameters, we are reiterating our financial targets as you've heard today. Our ambition is indeed to reduce the debt and we want to get the EBITA net debt to EBITA level below three. When we have achieved that level, we can of course go back to a full scale acquisition approach again, but in the meantime we will still do selective and small acquisitions but not until we have seen that pickup in cash flow generation that we are expecting towards the end of this year. So that is the plan and that is what we will be driving as a group. And as you can see, we have a fantastic team who will be successful in making that happen. So with that, we're wrapping up the day but I do want to ask you for a few more minutes to see a very good video that we have. And this time we are going to show a video of our partners, our supplier partners, and how they look at us as a collaboration partner in the different markets. And I think there are some really powerful statements in there. And after that, we look forward to having lunch together with those of you who stay and continue the dialogue about our exciting business. So thank you very much everyone for joining us today, it's been a pleasure. Look forward to the continuing dialogue, thank you.

It comes with the partnership and everything that comes with the long-term partnership and that is the strong relations it's mutual trust and then it is mutual also dependency we we are dependent on Triab AddLife as as distributors and they are building their business on Radiometer they've shown the way in the Nordic Market also for other countries where we have sales companies in the Nordic region for Radiometer we're very strong AddLife and the Triab distributor companies they have really been able to handle the markets and expand as as well as the sales company in Denmark so we have the highest market shares in the world we have the best customer support and so on and in that way they have shown the way I continue the long tradition growing in some very mature markets with high market shares so I'm looking forward to the future collaboration we've been working together for more than 50 years up to 75 years we look forward to continuing that so we just look forward to to this partnership for the coming many years.

We significantly grow our installations in the labom especially for the nuclear acid extractions and the virus detection and after that when we officially launch our next Generation sequencing products in the market and Euroclone and AddLife work together with us to design a go-to-market strategy about the NGS products and we really open the market in Italy together already and we are expecting significantly growth of the market share in the future.

Biomed has signed the contract in 2016 since they created a Sepsasolution they've grown faster than expected this has had a huge impact in their market and it's an example for all the other distributors that we work with actually worldwide we were very pleased to give Biomedica an award we wanted to put Biomed in the spotlight for all their activities that they do around our product I think what is really key in this sentence for me is a partnership it's not just a distribution it's a true partnership supporting each other wherever we need it and really build on each other's capabilities and knowledge they continue to grow they have increased the revenue about 40% last year and my expectation is that it will only be more this year with all the opportunities that are outstanding at the moment.

My name is Mar Martini and I'm the vice president for Europe for two operating units in Medtronic patient monitoring and respiratory interventions we have a strong relationship for a very long time with one of your companies that you acquire Healthcare 21 we are very impressed about the level of quality and service that Healthcare 21 is deploying to our customers the team is really Best in Class in their markets and our customers are delighted it's not a surprise to see Healthcare 21 to be part of AddLife and working now together as we share the same vision about providing the best value to our customers to improve patient safety and quality at the end we are also sharing the same value in terms of responsibility commitment and Innovation I truly believe on partnership we can't do every single thing alone we can go really further together.