Revenio Group (Helsinki:REG1V) Q2 2026 Earnings Call

0:01 Good afternoon and welcome to Revenio Group Q2. Earnings Call. My name is Jouni Toijala and I'm extremely happy to have Jukka Kainulainen joining in a call with me today. So, Jukka has started as a new CFO about a week ago, right? Right, Jukka? Two weeks in a row almost. So, would you like to introduce Jukka first yourself and then we get to the agenda?

0:34 Yeah. Thank you, Jouni. And of course, Very excited to be here. It's so exciting moment for Revenio after the strategic acquisition and starting totally new journey as a new combined company. So great to be here and previously has been spending my last 10 years in the global technology growth companies, of course, focusing always on the growth profitability and also capital allocation and also acquisition a little bit earlier in my career and the related integration topic. So great to be here and thanks a lot, Jouni.

1:16 Hey, thank you, Jukka. So let's jump to the agenda. So we are going to run a bit more different earnings call today. So we start actually with the VisionX integration status. Then we are also going to go through where do we stand. regarding to the synergy, so we discussed during the transaction closing and announcement regarding to the 20 million EBITDA uplift target, so we are going to recap that one, then of course going through the highlights of Q2 first half, Q2 and first half at 2026 and then Jukka is going to do deep dive for the finance part and then of course we have a guidance at the very end.

2:09 Before jumping to the integration and synergy, so like Jukka said, so it's nice to join in for the company because we are having a quite historic moment now ongoing, so I would compare this one to the Centerview acquisition at the time in terms of the significance. Of course, now the size is bigger, but of course, the old revenue, if I may use the word, so that's, of course, considerably sizable compared to the 2019. So this is the first quarter when we now have one month numbers in from the ex-Visionix side.

2:56 and based on the now kind of last or first 100 days, if I may use the 100-day word here, so everything is actually progressing well and according to the plan. So the strategic logic why we closed the transaction, it is still as strong as it was at the time of the signing and closing, which I found extremely So from the integration perspective, integration is progressing really well. So we have a couple of scenarios here. So I would summarize that we are now leaning towards the best kind of a best scenario in terms of the speed of getting the synergies in and the speed of integrating the actual organization.

3:56 So if we looked a couple of key areas here, so first from the overall integration perspective. So we have now nailed down even end of May, the leadership team organization, of course, the board structure, overall governance. And then during the summertime, we have been then moving further down to the organization in order to clarify the organization. and Operative Model, so that's going really well. In terms of the culture, so we run an extensive culture audit also during the summer and cultures are actually matching together extremely well and this is, at least for me, this is a more positive thing that I was expecting.

4:49 Then we have been putting a lot of effort to the commercial The US sales team, so we have actually combined already the US organization including the sales and the new team has been running operationally from the beginning of the August and what we have done in the USA so we have also finalized all product training related to the different products to the team and then also now bit by bit moving to cross sales targets, etc. and really moving to the execution in the past four to five weeks. On the international sales side, which Umberto is running, so John is running the US sales organization.

5:47 So from the international side, so we have clear plans now. how to start moving forward with the different countries, whether they are direct or through the distribution. So that has moved to the execution in last two weeks time. And I would say that the overall things have been progressing really well. Then coming back to the 20 million, Epida Uplift. So we have already secured a bit ahead of time the 5 million run rate saving regarding to the 20 million Epida Uplift. So there we are on track and then we also have plans regarding to next steps, regarding to operating model and then also things related to the procurement etc.

6:44 in order to be able to get and the remaining part of 15 million EPIDA uplift in the coming quarters. So if summarizing the integration status in one sentence, so it's going well and according to the plan. Then to the numbers. So of course top line up 39.3, roughly 50% up. What we saw on the profitability side is of course we have been coming down due to the couple of things on the profitability.

7:30 So the first One is the acquisition related one of costs, which during Q2 were roughly 3.4 million. So Juha is going to cover that one a bit more detail. Then I think that we should pay also attention to the cross-marching, which was exceptionally high in a previous year Q2, so 70%. to 0.6% roughly. And if we go back to the Q2 last year, so we actually didn't have tariff impact almost at all at the time. So we were stacking a lot of products into the warehouse.

8:15 So we didn't pay any tariffs on the imaging products. We didn't pay any tariffs regarding to the tonometers. We started to pay a bit tariffs towards the end of Q2 last year regarding to the probes. And if we look then from the cross-marching perspective, Q3, Q4 and Q1 this year, so I think we are able to say that we had the cross-marching Beyond the 70%, so that's partly explaining why cross-marching is done and of course we have a vision dilution, but Jukka is going to cover this one in more detail.

9:01 Then regarding to the whole first half, so net sales 66.6 up from 52.6, operating profit 4.8 and then we had in addition to the 3.4 million, so we had roughly same amount of acquisition related one of costs during the Q1 as well. So the whole acquisition related expenses were a ballpark of 6.9 million. Then regarding to cash flow, Juha is going to cover this one, but the cash flow was negative. And let's also come back on Juha's presentation.

9:49 So we had a really strong cash flow, exceptionally strong Q4. Last year roughly 15 million, so part of the costs were actually occurring during the Q1. Then after the Q2. So a couple of highlights from the other parts of the business. So we have been now receiving and working of course together with the iHealth screen regarding to the DRS Plus and the FDA clearance. So We managed now to get the first FDA cleared AI solution for the USA. So that's an extremely good news.

10:37 Now working closely with iHealthScreen in order to approach the customers and start pitching the product and we look this one of course to boost the DRS Plus sales in the coming quarters and years in the USA. And then another thing where we have been active and working for the long time in the USA and of course in the other parts of the world and this is really linking to the macro trends what we are seeing i.e. the amount of the patients is increasing The resources on the eye health professional side is limited and we are not able to treat and diagnose all the patients and in the constant communications we have been emphasizing the ease of the use and then automation what comes to the devices and here we go so this is a prime example of that one.

11:44 So we closed a strategic partnership in the USA with the company called iCheck, which is providing the kiosk where we have been integrating the DRS Plus for autonomous use and for the screening purposes. And then this kiosk is connected to the backend platform and then the patient is able to come to the kiosk and and then do the holistic screening of the ice. So extremely good thing for us in terms of the long run and just shows clearly where the market is going in the future.

12:29 But with these words, let's move to more detailed finances. So Jukka, over to you, please.

12:40 Thank you, Jouni. And let's start from the key figures for the quarter and maybe starting first from the Visionics. It's good to remember that Visionics has been now consolidated to the group numbers starting from the beginning of June. So one month Visionics in our quarter June numbers. and looking at the top line development, net sales increased 48.1%, currency adjusted growth 50.7% and when looking at the underlying business, our organic growth, that was more or less flat for the quarter. Gross margin went down to 65% and rounding it up, Comparing high comparables of 73% for the quarter two last year. I'm going to go a little bit more in detail in the following slide. And then when looking at the adjusted EBIT for the quarter, it was 5.8 million euros, so 14.6% from the net sales.

13:42 and that included 3.4 million acquisition related non-recurring expenses. So overall this was quite a good start for the new combined company and it's good to build the future based on this one. Then let's look net sales development a little bit more in details and the step up in revenue as you see in quarter two was coming from the Visionix impact like I commented in the previous slide. So organic growth was more or less flat and when looking the net sales at development and different geographies it was negatively affected by the market environments when looking the regions Middle East and Asia and then at the same time we see some positive development in our Europe region overall.

14:42 Then when moving to the profitability, like I commented, adjusted operating profit 5.8 million euros during the quarter, 14.6% of the net sales, and then gross margin declined to 64.7% compared to 72.6% during the quarter to 2025 and it's good to remember that it was really high comparable in gross margin like Jouni commented when looking whole last year gross margin it was 71% so quarter to 2025 was really, really high comparable. But then at the same time, when VisionX was consolidated to the group numbers that had actually two percentage points diluted impact due to lower margin profile in VisionX business.

15:32 And then when looking the old revenue underlying business over there, the gross margin in that business went down by five percentage point. And that was driven by, for example, the tariffs, which we didn't have in last year, Q2 numbers. And then there was some increase in the unit cost, for example, in the electronic component side. And then also overall, there was some increases in our fixed costs during the Q2 2026. Then moving on on the cash flow, cash flow from operations was negative by 2.4 million during the quarter and it's good to remember that that included around 3 million euros of payments regarding the acquisition and the related project we are running.

16:25 And then at the same time our networking capital increased at the end of the quarter especially relating to accounts receivables and this is not kind of normalized run rate of course it's a more like temporary situation regarding the acquisition and then when looking both companies cash flow generation like you know revenue has been always really strong cash flow wise H2, especially quarter four and there is similar kind of cash flow profile also in the VisionX business so a major part of the cash flow is generated in H2 comparing to H1 for the calendar year. Then moving on the balance sheet and balance sheet metrics of course quite a lot reflected by acquisition financing and net debt now 238 million so temporary up including the 130 million term loan from the what we closed in quarter two also bridge to equity financing 80 million and the 17 million vendor loan also relating on the acquisition.

17:31 And then on top of that, we have revolving credit facilities in use, around 20 million at the moment. And when looking at these metrics, balance sheet metrics, equity ratio at the moment, 31.2%, and net debt adjusted EBITDA is temporarily up in 5.3%. And then it's good to remember what we have communicated also earlier. So we are planning this post completion right issue worth 80 million that will happen during the H2 2026. And the purpose in that right issue is to pay out this bridge to equity facility. And through that, of course, strengthen our balance sheet and improve our leverage metrics overall.

18:24 Then briefly our shareholders base so latest gap table and as you know revenue is quite global when looking from the shareholders point of view more than 50% of the ownership is outside Finland and the of course recent changes you see in this gap table in top 10 we have two new major owners number two Caravelle Capital and then number 10 Mark Abitbol and these of course are the big changes and relating on this acquisition. VisionX acquisition will be completed during quarter two 2026. Then as the next, let's cover the financial guidance for 2026.

19:10 and in top line we guide currency rate adjusted net sales to be between 190 million up to 205 million euros. And EBITDA excluding non-recruiting items we estimate to remain at satisfactory level. and the assumptions behind the guidance in the lower end, we expect a little bit softer market environment and slower customer activity and in upper end, we expect improvement in the market condition and then of course, successful sales execution as well.

19:51 And Jukka, if I may jump in. I think that we have had the questions now regarding to the guidance what dissatisfaction means and we have been long time in a good level so would you would you open that one a bit?

20:12 Yeah sure it's an excellent comment when looking for example our last year operated adjusted EBIT for the year so we were in 24 percent and now when we look to 2026, the adjusted EBITDA, we were at 17%. And now we guide that we expect that to stay on satisfactory level when we communicated last year to profitability to stay on good level. So that's the way to give you conclusions on our profitability guidance levels.

21:02 Then next one, little bit also reminder, one week from here, we are organizing Capital Market Day. So 15th of September, where we of course will present our new strategy. We will present our combined company go-to-market plan, company product portfolio, our synergies and then of course on top of that the numbers of our new financial targets. So welcome everyone who is able to join to that event. Then at the end also like I already mentioned we are planning this cost completion right issue That's a word of 80 million euros altogether.

21:55 Nordea is our global coordinator and actually underwriter for the right issue as well. We target to arrange that during the mid to late H2 2026. And our main owners, Billion Demands, and also the sellers of the acquisition owning altogether close to 31% of the shares have irrevocably committed to subscribe the shares pro-rata based on that right issue. And like I already commented, target is to use the funds to repay our 80 million bridge to equity facility and reduce our leverage ratio and strengthen our balance sheet altogether.

22:41 Thank you.

22:43 Hey, thank you. I think it's time to move for the questions, please. If you wish to ask a question, please dial pound key five on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial pound key six on your telephone keypad. The next question comes from Niko Ruokingas from SEB. Please go ahead.

23:06 Hello, this is Niko Ruokingas from SEB. Thank you for the I have three questions and I'd like to go one by one and start with old revenue or organic sales development which was flat year on year. So to open that a bit more given that it seems clearly lower than the original guidance you had entering this year in the winter so has something changed in the market or your own performance or can you elaborate a bit more?

23:45 I could perhaps pick that one up so if you look the Q2 old revenue perspective so and this one we have had also the earlier so might be that in the certain quarter, so demand might be different or then we have one or two bit more slower months. So if we look now and we go a bit and we break down the performance, so like Jukka said, so APAC was lagging behind on the growth like it was Q3 last year, Q4 last year, Q1 this year compared to the previous comparable quarters but the positive side is that the situation is basically improving quarter by quarter so part of the growth we were missing from the APAC. Then everyone knows the Middle East status so Middle East side of the business was extremely slow regarding to the to the Iran conflict. Then if we go for Europe, so Europe in reasonably good shape, I would say, so customer activity Good and pipeline looks good and the USA

25:19 we saw a slight growth in the USA and tonometers were performing well imaging slightly shy so I wouldn't draw too critical conclusions based on one or two months inside the one quarter yet. But this is now the case, so Q1 old revenue, we had a growth and then it was reasonably stable and flat during the Q2. But now if we look how the Q3 has started, so I mean old revenue back on the growth track. Hopefully that answered your question.

26:07 Yes, and just to follow up, how much on rough terms was the impact from Middle East?

26:16 We don't give the country specific numbers and also VisionX is having a Middle East business, so that's kind of visible on VisionX one month. numbers regarding to the June.

26:38 Yeah, I understand. Thanks. Then I'd like to go a bit deeper still on cross-marching, which was done year on year in Old Revenio. You explained a bit more already, but I was wondering whether you can go a bit deeper into the topic given that I guess that the cross-margin was weaker than in Q4 and Q1 when price increases in the US had not been implemented well so completely so have you now been able to do all the price increases related tariffs and then Can you be more open to the component inflation situation and what will you do about

27:30 it? Maybe I comment the price increases. So the price increases are in. Do you want to comment? I shortly commented on tariffs, but do you want to comment on component?

27:43 Yeah, I can. Of course I can do that. Of course the tariff impact when looking year on year was quite significant so we are not talking only hundreds of thousands but it was more significant impact and then the unit cost impact on top of that contributed basically the rest and like we commented the electronic component cost and this is of course going further further that of course we we will review what kind of actions we do either reducing the unit cost or from the pricing side so those are the those are the tools of course how we manage the manage the situation going forward okay thank you then one last from me you were reporting I guess

28:32 13 million euros of adjusted EBITDA consolidated but not pro forma in H1 and then the pro forma was 14.6 so is it so that Visionix generated only 1.6 million euros of EBITDA from January till end of May Has it declined in H1 year on year or is the profitability in vision extremely H2 weighted? Can you open that a bit more?

29:10 Yeah, Mikko, I can comment. This is a great question and this is of course I know challenging for the investors when January and May are not in the numbers, but actually in VisionX of course we know the H1 numbers, so there was quite a high weight in the profitability until the end of the H1. so that's the thing and that's usually there's some seasonality in that sense in the VisionX business more of course I don't comment about the Jeremy May VisionX numbers and then when looking the pro forma it's good you know of course remember how pro forma is completed it's based on the assumption that the deal is executed already 1st of January 2025 so that it's some kind of kind of the theoretical way also to build it up so that gives some slightly differences when looking at Boroma and where we are at at the moment but of course it gives a good good enough picture but those I would highlight based on your quest okay but but if we look at kind of a year-on-year basis No, yeah, overall that I can comment. Sorry, Nikko, I forgot to answer.

30:23 So when looking H1, VisionX comparing last year H1, even though we have only one month in. So no, no significant change in the profitability profile year on year.

30:36 All right. Thank you. That's all from me at this point.

30:39 Thank you, Nikko. The next question comes from Pia Rosquist-Heinzalmi from DNB Carnegie. Please go ahead.

30:51 Hi, gentlemen. It's Pia Rosquist from DNB Carnegie. I've got a few questions, so I try to limit myself. If I start with your sales development now in the second quarter, and I know, Juha, you said you don't comment on VisionX in particular. for the first half but is there any light you can share on how VisionX fared now in the first half of this year compared to the last year last year's first half did sales for VisionX decline in the first half of this year and no no no so so on on the top line perspective flat

31:46 So if we now look the competition and we compare the performance so even though that iCareX or old revenue grew during the Q1 and now if we look kind of a flattish Q2 and then the Q3 now looking good and then VisionX staying on the flat in the market where we operate so I would consider of course not a stellar performance but it's a quite robust performance compared to the competition.

32:32 But Jukka anything you would like to add on this?

32:34 No I fully agree nothing to add on that.

32:39 Great thank you. and still going back to your first quarter report where you told that the price increases had been applied and I think starting to impact from February onwards and now you said you reported flatty sales for the old revenue so Is it actually so that the volumes declined in the first half and were compensated by the announced price increases?

33:20 I wouldn't say so, but we have also seen the Q2, like Jukka mentioned, so we have been also seeing the increases on the component prices, so whether is it the memory, whether is it the CPU, whether is it the increased price on the gold, which is then used in the probes, so I wouldn't I wouldn't draw that conclusion and what now comes when going forward so we now start to go through the details bill of materials now during the second half and then doing a decision in the remaining part of the year that should we adjust the prices if the memory and CPU and raw material prices are going to remain the high. So that's a standard procedure what we do.

34:22 Okay, thank you. In general, looking at the market sentiment and demand and now given your broader footprint in the market, what do you see with regards to the market demand and your sales pipeline? I know you have always underlined that the revenue sales pipeline is short, but in Visionix you have slightly more visibility. What is the current market demand?

34:56 So maybe I pick that one and Jukka, please help me. So USA, like we discussed in the earlier quarter so that has been surprisingly robust and now we have a new sales team in place so the new combined sales team we have split all the care graphics etc. of course there's a certain ramp up time but actually if we look to start for the Q3 So it looks good. Then we have a lot of cases in a pipeline, type of cases where we haven't been before because we have a combined portfolio.

35:43 Of course, the key is to turn them. to win. So that's a crucial thing. Then if we go for Europe. So Europe has been steady and then I hope that the APAC turns in a bit more better shape. So we have had a positive trend now quarter by quarter. So we have seen a bit more better activity as an example in South Korea. etc. We did the distributor chains in Australia so that's the reason why that part has been bit sluggish if I may use the word earlier this year so hopefully that's going to help up the situation in APAC because that's one of the biggest countries for us in APAC. Of course now we have to remember when we report now the queue the Q3 so then it's going to be first month where we also have a Vision X numbers fully in a quarter so that's going to be interesting to see.

36:55 Anything Jukka you would like to add?

36:56 No and it was of course positive highlight when looking at the underlying businesses that you know Europe region developed quite positively when looking at the quarter two overall.

37:15 Coming back to the gross margin and the discussion about the factors burdening that, do you have some kind of guidance for your gross margin for the remainder of 2026?

37:34 Yeah, no, like you saw, we were guiding the EBITDA and then, of course, the top line. But it's good to remember now when we consolidated Visionics only one month and then, of course, with the lower margin profile in the Visionics. Of course, we will now, when we consolidate the whole company, that's generating absolute terms, lots of more gross margin. But then this dilution impact will be whole quarter, starting from quarter three. So that's a good to remember when looking the percentages.

38:07 And I don't know, Pia, is it helping on? Sorry to jump in, sorry to interrupt. If we think that we look the quarter three, quarter four, so I think the old revenue side, we have been roughly 68, 69, depending on the quarter. And then we have a vision dilution part of the package, so further diluting. So I think that's a Paul Park, right, Juha? Yes. Maybe it helps.

38:40 All right. Yeah, thank you. I have further questions, but for now I go back in the queue. Thank you.

38:47 Okay, thank you, Pia. The next question comes from Daniel Lapisto from Danske Bank. Please go ahead.

38:55 Hi, it's Daniel Lapisto from Danske Bank. Thanks for taking my questions. I have a couple, maybe starting still, If you didn't execute this vision exchange transaction, would this previous guidance of 8-15% growth this year, would it still be in place after the Q2?

39:24 I think that Not too sure is it a relevant question at this new state but I wouldn't see so we have also the big deals in a pipeline for the remaining part of the year and Q3 or Q4 is basically strong so I mean forecast looks good.

39:53 Okay just follow-up would have been on those larger deals that you discussed so they are still on the table and I guess there would be a better second half.

40:04 So for certain cases we have been receiving kind of a single product PO's so still live and kicking of course the timing and rollout always a question mark.

40:23 Okay that's clear. Then on this margin guidance Satisfactory margin, I mean, how wide should we think the range is here? I guess historically, you know, with the EBIT margin, I guess it used to be even 10 percentage points. At least it felt like it. But basically, how wide can this range be, actually? Can you go single digit on EBIT and it will be still satisfactory?

40:55 We're not far off what you commented in the beginning, but maybe I kind of repeat myself. So last year adjusted EBIT was 24%. And now when you look at adjusted EBIT A in the quarter two, we were in 17. So I apologize that I cannot comment that more because that's what we have disclosed. But I hope that a little bit helps you to understand what kind of range we have in place for that wording.

41:26 Okay, then maybe on the, you know, standalone revenue cross-margin, there was some and it was five percentage points down year on year, so clearly below 70%. The comparison was of course difficult, but I guess in the mid-term, I guess 70% is the target that you are looking for revenue or has this changed, I think it changed over the component shortage and whatnot.

41:53 Maybe I pick that one Daniel, so I think it's a realistic to think that yes we have had the target before the tariffs hit to the place to keep it above the 70% which we have been able to do and now when the tariffs are full in we have been ballpark of bit depending on the quarter 68, 69 and so forth so I think that it would be reasonable to expect and of course we don't anymore in Q3 like in a Q1 to report the old revenue if we use that term so but if we go for old revenue I think it's fair to assume that being constantly over 70 so that's undoable with the tariffs.

42:47 Okay that's clear. And maybe the final question on this, Ilun, you know, AI solution, clinical trials. I mean, obviously, we saw that now the third-party solution was approved. Can you update us on the timeline with your own old solution? What's the status of the clinical trials and what's the approval timeline that you're seeking?

43:15 So we have now concluded the pre-study. So that went well. Results are okay. Now we are doing a new pre-submission just to be sure. And of course now the iHealth screen a bit reduced the pressure to push aggressively forward rather now in a mode that we guarantee that we get the clearance when we do it. So the status is that the pre-study done and now we drew the pre-sub Another precept for FDA to be sure that the house is in order then we have start another study then towards the end of the year or early next year and we communicated earlier that we are going to be ready by clearance by the end of the first half 27 I would be now more leaning towards the second half hopefully Q3-27 and the reason is that now we have the iHealth screen clearance so we just want to be sure that we are able to get the clearance so we do the pre-sub now in to the FDA again.

44:39 All right that that's clear so all from me thank you. The next question comes from Erik Karlsson from Erik Karlsson. Please go ahead.

44:50 Hi, thanks for taking my questions. Erik Karlsson from KPK. Just on Visionix, if we look at the first half performance, you said basically flat sales and kind of flat margins. How much worse is that compared to your business case you bought it? I guess at the time you thought they would grow and have increasing margins even before Before synergies, just trying to understand how far below they are tracking currently.

45:25 That's according to the expectations what we baked, what was in the model. Because we had the closing then.

45:34 You didn't think it would grow and you didn't think they would improve margins?

45:39 So if we look at the timing and the process of course we had the forecast for the first half and for the second half and then We started to bake into the numbers by the closing so that we are able to start getting the synergies in terms of the OPEC savings and in terms of then the commercial synergies. So basically Visionix in a one sentence Visionix has been performing during the first half what was our expectation at the timing of the signing and closing the deal.

46:23 Okay, it sounded like when you did the acquisition that they had an internal plan to improve gross margins because I think it was quite shocked by the low profitability they had at the time.

46:36 I think if we compare the profitability of X revenue and the Vision X and the industry in general, so the Vision X have had the numbers on on black, almost everyone else on red. So that was basically known and then we have at if you think the vision so we have had this in internal efficiency plan which they put in a place at the time of the negotiations and and bit before that one so that's progressing and then as as I said earlier so we have been able to now secure out from 20 million epida uplift the five million already in so that work is is constantly moving forward and and the plan is to get The EPIDA level and improve the margins then up to 25% by the end of 2029.

47:40 So the plan is there and it's progressing according to the plan.

47:46 Okay, got it. And then on the profit guidance, and I don't know who advised you on this, but I think there's two ways to go. One is that you don't want to tell the market and then don't guide, or you want to help the market and you do guide. and what the market wants is numbers. They don't want to work very hard. It just becomes like a game to translate that into numbers. So I think either way is fine to go, but to start coming and saying, well, such structure for you might not be for me. So we just get into this ridiculous game. So I think if I were you, I would either not guide on it or I would just put a number up there or arrange them. Does that make sense to you? Yes, that's true.

48:27 Great feedback, thanks a lot, we appreciate that a lot.

48:30 So, yeah, we will of course. Yeah, yeah, I agree that one. That has been the history that, like Jukka said, that we have an objective to describe the growth and describe the profitability. Now what we have been now, Trying to improve is now that we gave a bracket for the top line and still did the decision that we used the objective. on the bottom line part so that's going to remain for sure for the remaining part of the level for the year but I think this is constantly asked from us that should we actually give a euro amount or should we give a percentage amount so we take The next question comes from Pia Rosequest-Heinzalmi from DNB Carnegie. Please go ahead.

49:58 Hi gentlemen, thank you, still a few questions if I may and now I'm going back to the synergy potential you have presented so you target an adjusted EBITDA uplift of 20 million euros by the end of 29 and I'm just So, are you able to open a bit the question of what do you mean with the operational uplift so yeah the operational leverage I mean from assuming your sales will grow there is some operational leverage in your system so I'm just if I understood your ambition to raise the adjusted EBITDA level by 20 million so yeah okay in this discussion how about growth and the implications from that.

51:09 Okay, hey thank you and Jukka now correct me if I'm wrong but at the time of when we announced the transaction and at the time of the closing we reiterated the 20 million EBITDA uplift and the big part of that one comes from the OPEX related synergies, right? and Jukka. And now if we think now the first five million, so what we now have been able to achieve. So that's coming from the operational side in order to combine the Vision X US team and then X revenue US team. And that's coming from the OPEX side. Then we also have a commercial cross-sell upsell part which is then the part of the 20 million EBITDA uplift which then comes more from the Operational side and we haven't split the ratio but if you would look the picture what we used the water for there's first commercial part and then there's OPEX part so you kind of get the sense and the feeling how it's divided and then the scaling in a way the OPEX and that part so I mean

52:41 if it just So you kind of get the scale from the growing, but there's only this cross-cell up-cell part that we count as a synergy, so not in a way the normal organic. Saito Opa, Jukka do you have anything to add on this one?

53:03 When you grow of course you always lead the business in a way that top line grows quicker than the fixed so if you refer to that so that's a separate topic of course.

53:17 Yeah exactly that was my point so yeah so 20 million is kind of That's from the synergy, and then anything you might grow upon in addition to that, that brings more leverage to the equation.

53:36 Yes, fully agree.

53:39 Yes. All right, thank you. Then just shortly, when I skimmed through the report, did you directly comment on kind of sales impacts from maybe VisionX selling your products, so kind of internal sales that will be eliminated or even broadening the question to potential overlapping products. Have you taken this into account in the pro forma numbers?

54:18 Yeah, it has been taken into account. I think it was something worth of 300,000. We're looking at 25 numbers, so that has been taken into account.

54:27 All right. Okay, thank you. And then finally, if I still can get the clarification, the networking capital to sales profile for the combined company, in what ballpark do you see the combination, say, this year or next year?

54:50 Yeah, overall roughly numbers when looking networking capital for combined company and of quarter two it was in around 60 million level and of course we of course constantly will continue optimizing that going further.

55:11 All right, I think this is all for now. Thank you.

55:17 Thank you, Pia. Thank you. The next question comes from Niko Ruokingas from SEB. Please go ahead.

55:24 Hello, this is Niko Ruokingas again. I have a couple of clarifying questions still. And maybe now on EBIT-A, as you are now starting to report that as headline KPI. So out of the amortizations you are expecting to report in issue or on run rate basis going forward, so how is that divided between the amortizations revenue, old revenue had the standalone VC amortizations and then PPA from this transaction?

56:05 Yeah, so this amortization includes, of course, all of those. And when looking a little bit at the details, the Visirik acquisition brings around 6 million new PPA depreciation. And then on top of that, other amortizations, we have around 2 million, a little bit more than 2 million. So we are in around 8 million level, a little bit higher than 8 million annualized number going further.

56:36 Right, thank you. Then you were discussing about the leverage post-rights issue of roughly 2.5 in time of the announcement of the acquisition. Is this still a relevant target around the region?

56:58 Of course in some point yes I think when looking the current I think you're talking about net debt EBITDA which was 5.3 in quarter two and after share issue it goes to closer to three when looking the current estimates. but of course you know we continue generating gas and profit going further so that will always stay over quarter over quarter improve the leverage ratio but that's the short term view yeah thank you and then still on TARIS which we have been already discussing about but then

57:44 I guess that the basis for the tariffs has a bit changed now over this one year period. So do you think that you could receive tariff-free funds for the tariffs you have paid under the kind of old basis of tariffs?

58:03 Yeah, this is something we are looking after, the refunds from the tariffs. So this is what we are working at the moment, actually.

58:17 All right. Thank you. That's all from me.

58:21 Thank you, Nikko. Thank you. There are no more questions at this time, so I hand the conference back to the speakers.

58:32 Thank you all. Extremely active call and if I may summarize at the at the end so integration moving extremely well forward so I wouldn't be too Two concerned on that one, we have managed to get 5 million out from 20 million discussed EPIDA uplift already in sales teams integrated in the USA. Operative model moving swiftly forward. Then also we are on the channel side in the rest of the world. We have moved to the execution. Then we are going to have exciting news coming on on ESCRS.

59:19 So we continue working extremely hard here. in order to grow the top line, finalize the integration and get the margins up. Thank you for the participation and really looking forward to catch up then during the Q3 earnings call. Thank you for your time and interest.

59:41 Thank you.