Arcoma (Stockholm:ARCOMA) Q1 2024 Earnings Call

0:00 Hello and welcome to Pencer Access by Carnegie. My name is Hjalmar and I work as an analyst. I'm here with Mattias Leire, who is the CEO of Arcoma. Welcome, Mattias. Thank you. You have released your Q1 report today, which we are going to talk about. So I think we'll jump straight in and start with North America. Very strong growth here. Could you quickly talk about the key factors? It's a strong growth despite the fact that you met and then we held simple comparison talks here.

0:25 We see that our partners in North America, Canon, continue with their momentum driven by investing in markets. They have made long-term commercial investments that are now starting to pay off and continue the trend. So they have found and unlocked the key to the market in a different way than they have seen before. And how is their position in the market today and how does it compare to what their ambitions are?

0:55 I think they want more than what they are right now. It is generally on imaging and you can also see in their own report. So they are a strong player but have absolutely a higher ambition than where they are right now. If we look at the underlying market in North America, how would you describe it?

1:14 The economy is going strong in North America. We can see that with inflation figures. There is a strong desire to invest and there is money for investments. I think the market is going strong, but we also see clearly that they are taking market shares. If we look at the products, then you mention Precision i5 goes strong here in the quarter. This was a product that was launched when the market was very active. How would you say that the development looks right now? Is it that we see that the growth of this system is taking off or what is it that we see happening right now?

1:54 When we see that the market appreciates our products, our I5, our latest product with auto positioning and continues to be an attractive product. If we take a look at Europe, you mentioned that there are ups and downs in the future. You also meet tough friends here, and that's what explains that we see the sales figures we see there. How big is the visibility in this region when we look into the future? Do we need to see a macro-environment, an underlying environment that is changing here? If we look forward a little.

2:36 We have seen the decline in the past year, and we see that. A little bit of timing, a little bit of investment in the future and, as we also write, a little lower conversion rate right now. But I think we are beginning to see indications that more activity and maybe you have gotten used to the interest rate. So we are starting to see a beginning at the latest. So if you think about the deals in the future, you don't see any risk of losing businesses, but it's something that can be taken into account if we see a little improvement in the environment?

3:14 Yes, that's the normal thing where we said it worked throughout the history of Arcoma. We are used to handling the fluctuations that we have done before. If we look a little more broadly at your geographical exposure today, where you have the market presence, is there room to add more markets and what could that be at the moment?

3:37 We always look at, it's both actually to see new markets, I mean now in our commune in South Korea, we think we are on the right track from signing to getting started. And then there is to deepen the market. There are markets where we do not have the sales presence that we have today. We have a distribution channel that we need to expand. We work via partners. So there are both completely new markets, but also to focus and deepen the presence and lock up more markets and get more focus on them. And what factors do you evaluate there? Do you feel that there are markets that are particularly interesting in the current situation, given the competitive situation or what you evaluate?

4:26 I think it's important to take a look at our partners where you want to invest and where you see that the journey we have made in the USA, You want to be underrepresented in the crowd, you want to grow in the crowd and take that with you. We see that Canon has a clear ambition and wants to grow and then it is necessary to take that with you in the markets and make sure that the instrument is in place. If we look a little further down in the result calculation, the cost side is still good control, even though you are growing very well, so the movement costs decrease here. Is there any further explanation factor here, or is it just that you experience an overwhelmingly good cost control?

5:10 We looked at the cost picture in the spring, so it's starting to take effect now, and be careful and see what Thank you very much for answering our questions today.