Good morning. It's 10:15, let's kick off the Q1 presentation and Q&A for the RTX numbers.

Welcome to Henrik Mørk and Mille Tram Lux, CEO and CFO. Henrik?

Thank you very much, Poul. Welcome to all of you online.

We will run through this short agenda. Just shortly about RTX.

We've put out, well, on the selected insights what we like to bring every time a bit of selected insight this time on ProAudio, one of the the segments that we we see a good performance in this quarter, then the financial and business updates finishing off with outlook, and of course leaving ample time for Q&A. I hope you, if you have any questions, be you're more than welcome to to share.

Otherwise, I'm sure Poul has a couple of questions as he usually do. All right.

Oops, sorry. RTX spent more than 30 years deep diving into short-range wireless technology, really building our core in that, providing secure, reliable communications in critical and challenging environments.

That that is our core. We unfold that in our three business segments: Enterprise, where we develop and produce headsets, handsets, communication solutions for the business environment.

This is also if you go to, for example, Netto, JYSK, or Tesco, you'll see push-to-talk headsets on the employees that's developed and produced by by RTX, so that's one of our growth segments, the the retail segment within Enterprise. We have Healthcare, where we provide secure and reliable communications infrastructure for monitoring of critical heart patients, one of our clear growth segments that we are pursuing with with our partner, focusing on on the US.

Then we have ProAudio. This is where we, embedded all our 30 years of experience into a small IC, size of a stamp, that allows our customers to build solutions, voice communications solutions, enabling teams to have secure, reliable, hands-free communication, yeah, in in the environment that that they are in.

The picture here is, from forest fighters, forest fire fighters going in where team communication is imperative for for their success. This is this is what we do.

Our business model, we are an OEM supplier, so, we we partner and have done so for for the last more than a decade with with many of these companies, all global players that, give us a global reach for for our solutions and and products, our solutions are found globally and and allows our business basically to to scale. Our business relies on on a number of market trends.

Anywhere, anytime, so, the the push for being online and being able to communicate any in in all environments, also in environments where the standardized infrastructure of cell cellular or Wi-Fi isn't there, or if the quality, doesn't cut it, there's still a push to be able to communicate and connect, and that's basically what we we, provide across our businesses. Underlying the healthcare opportunity and business is the change in demographic, aging population, without, with with the same number of hands to to care for the aging population.

Medtech is is is one of the solutions, and communications infrastructure is is a huge part of that. The geopolitical tension is, it it's a coin with two sides on it.

One side is is really, it's challenging our business in terms of, as we are a global company, with a with a global sales reach through our our customers' sales channel networks, the geopolitical tension and trade challenges that we're seeing with tariffs and and so on, and and the negative effects on on exchange rates, that is definitely requiring us to to build and and to sustain the agility and resilience in our operations model. On the flip side of that, there's also opportunities because, very much in our ProAudio, we are seeing very strong interest and opportunities in in defense and emergency communication or critical, mission-critical communications.

Our technology has a strong fit for that, and we are seeing a lot of interest, and we're also seeing a business building slowly in that. Then, of course, continued digitalization, which really is a drive not only to do products, but also to integrations to make sure that our solutions are integrated into a broader portfolio and also offering cloud-based offerings.

That's definitely also underlying our our business. A bit on our our business model trying to visualize here.

Overall, I would, it's it's an asset-light model. We really focusing on our core, which is providing the market insight, the technology leadership within wireless communication, design, and development.

Manufacturing, which on on on the left side here, you can see we have outsourced with our manufacturing partners, we have a global footprint on that, but also a scalable and flexible footprint, which is something that we are definitely utilizing these years with, with the with the changing tariffs and so on, that that allows us basically to to move production from one facility to another facility in not not without challenges, but easier if we owned than if we owned the assets. Then on the other side, of course, we are we are, utilizing long-term agreements with our customers that, when we with them design successful products, and they're able to scale it in the market, we are able to scale our business in in that.

Really a partnership-driven value chain, which is senior the core of RTX. That was the brief flyover of of RTX.

Then we brought a selected insight, and I talked a bit into it. TeamEngage is is one of the products that's part of our ProAudio business.

It's it's basically, where we put all our IP and know-how into building a communications chip that can be built into headsets or other wearables that is really designed and focused on critical mission-critical environments. What we're able to provide to our customers is seamless use across scenarios, whether you are inside vehicles or on foot, if you're on a boat and you have to board a ship, that that seamless communication within that team is imperative; secure communications both with a high resilience to to jamming; easy to integrate into to your solution, we have integrated both in helmets, but in headsets; and what it really does is, because it is really hands-free, it's not about only cutting the cable, but it's also about how it it self-configures within the team to make sure that the the the team that has critical tasks at hand can really, really focus on the task at hand.

We are seeing a lot of interest with this. We have a couple of customers that that are that are one is is really far in building products and bringing it to market, and we are seeing a strong pipeline for this product, the TeamEngage.

This is also some of the elements that we are seeing when we get into the numbers, that the ProAudio business on our on the the module-based business model is is picking up, and this is one of the the subsegments that we are definitely seeing positive traction and also a positive pipeline going forward in this. The the numbers.

From overall, we denominated a a solid start of the year, 7% year-on-year Q1, 108 million in in revenue, with a 7% increase for to compared to Q1 last year. Adjusted for currency effects, it's actually a 7- 17% increase.

The underlying business, we we see a a good performance on that. Very particularly, the Healthcare and the ProAudio business segments has had a strong performance compared to to last year, but also compared to to last quarter.

Healthcare is not just short of or 19 million, which is significantly up from Q1 last year, but also up from from from Q4 last year. ProAudio, where we're really seeing a positive traction and also showing the first signs that the transformation that we did in our business model, going from selling full products to selling standardized modules, is picking up and and proving that we can both drive up revenue again, but also drive up gross margin on that business.

We we, really happy to see positive signs of of our our strategic transformation of that business kicking in. Again, strong focus also, of course, always on our gross margins up to just short of 55%, of course driven both by a favorable segment mix, Healthcare playing a bigger part, but also ProAudio really pushing that up, the product mix has been favorable this quarter.

Happy to see that. Of course, that also reflects positively on the EBITDA.

On the other hand, of course, the headwind from the weaker US dollars is pulling the other way, but still a 5.5 million increase in EBITDA compared to Q1 last year. This is definitely something of course we are happy about, but this is also something where we are are focused, because of course we want to see positive numbers on the EBITDA and also on EBIT.

We have continued our focus throughout last year, but also Q1, we've really had a focus on reducing our inventory just short of 30 million. We are probably at at the level where we are discussing what what should the level be.

I think we earlier communicated 30 to 40 million, now we are at the lower end range of of that, lower level of of that range. This is this is where we are, but of course always that's going to go a bit up and down depending both on the risks that we are seeing in the supplier market, but also the the demand from the customers.

A strong balance sheet. We maintained a net liquidity position just short of 150 million Danish, which supports the agility of of the business.

Yeah. On on Q1 results and and what we're seeing both in terms of of of positive traction in the market, but of course there are also some challenges in the both in in the geopolitical environment, we maintain our full-year guidance.

That that's the the flyover, and then just very shortly on on I'll do this fairly quickly. Yeah.

Enterprise revenue 62 million, down from Q1 last year. The the over the underlying pull from the market, we still see is being being positive.

We have seen the revenue is due to shipment timing. As we are order-producing, we are very depending on when orders come in, whether it's before or after a quarter.

We have a a strong belief that we will be able to to pick up this throughout the year on on Enterprise, our full-year outlook remains unchanged despite what you could call a weaker quarter from from Enterprise. ProAudio, as I said, strong performance, 27 million compared to to 17 Q1 last year.

There are some timing effects in that, but even taking that away, we are seeing really a positive development on that, and we're also seeing a positive pipeline throughout the year. I think as we we discussed on the last call, we have really a a a clear target that we want to make sure that the ProAudio business is a EBITDA-positive business this year, we really can take that as a stamp that we are on the right traction on on this a strategic change on that, and Q1 Q1 supports that.

Healthcare, 19 million, up from 5 million in Q1, and I think it was what, 14 or 15 million in Q4 last year. A positive development in in Healthcare as well, and we are continually transitioning the the the product ownership as as planned with with Philips.

Basically, yeah, it's a strong performance. It's also a performance as we expected and and hoped for this quarter.

Yeah. Just summing up on the key financials.

The revenues up to 108 from 101, and, as Henrik said, it represents a growth of 7% compared to Q1 last year, and 17% when adjusted for these currency effects, impacted by growth in ProAudio and Healthcare particularly, and then counterbalanced by the Enterprise development, which is a shipment between quarter timing impact. The gross margin is approximately 55%.

As we've been working on increasing the gross margin both through mix and also product selection or product focus. Of course, this quarter is positively impacted by the mix of segments, where Healthcare and ProAudio is playing a bigger role compared to Enterprise than what we would expect a split for the entire year.

If we look at EBITDA, we are then at -4, up from last year, positively impacted by the better gross margin, and then negatively impacted by the currency compared to the same quarter last year, where, as you remember, we had a relatively high currency above 7 end of last year, end of '24. On the inventory, as Henrik said, we've got a level of around 30 million, and you can say what would take that further down is our partnership set up EMS, where our partnerships entails that they are taking the inventory, that they're actually planning that.

What takes it up is our transition out of China, there it can be relevant for us to secure a number of components in order to ensure production. Of course, the geopolitical situation both with China and Taiwan is also something that could play it up.

We still believe, as we communicated before, that the range of this 30 to 40 million is a good level. Cash flow, positive cash flow in the quarter, mainly impacted by the changes in working capital.

Therefore, also our net liquidity position is approximately the same as the end of the financial year last year. Positive by the free cash flow, and then of course we are continuing the share buyback program that we announced in September last year.

That leads us to maintaining our outlook of 575 to 625 on revenue, 35 to 65 on EBITDA, and 0 to 30 on EBIT. That concludes our flyover of the first quarter.

Yep. Thank you.

Then, as usual, if anybody has a a question, then raise the hand. If I can't see everybody on on the screen, then give a shout if I'm not putting you on the on the mic.

First question from my side, if we take these three divisions and this timing of orders, if you take Enterprise, which was soft, how much are we talking about moving from a Q4 to a, sorry, from Q1 to a Q2? Is it 20, 30 million?

Or you can do the other way around: What size is in in this business? What's the sizes of batches which can move around in general?

I think we can have a variation of 10 to 15 million in shipment sizes. Of course, we can have more customers where this impacts.

Up to a 20 million would be a normal spillover between one quarter and the next.

When we have this timing impact, is that one customer who has moved, or is it several customers who has [delayed?] deliveries?

It's a combination of customers. I think what we can say is that the timing, we have shipped out quite a bit of what we expected end of last year already in January.

It does not impact our expectations for the full year.

Does that mean that we should add it, if we had a model prior to the numbers, should we then add this timing on top of what we had potential before on Q2, and why are you then moving something from Q2 to Q3?

Of course, I don't know your model, but our first half year is as expected.

Okay.

If that's given, then, yes, you should add it to the Q2.

Okay. Then we talk about more than one client,

yes.

When you state that you are confident for the full-year guidance and you relate to the indications you get from clients, is that then based on that the H1 is normal, or is it also based on comments on their sell-out and how they look for the second half, or have you no insight because you typically has this 3 to 6 months and

nothing

insight more less to end of Q3 now?

Yeah. Our view on the full year is of course based on three elements.

Of course, the Q1 performance, the order book that we can see, and then the forecasts and the discussions that we have with our customers, and, of course, also balanced by our understanding on the underlying market within the three segments, where ProAudio is probably a bit more difficult because that's actually really many markets, right? Very much for Healthcare and for Enterprise.

It is based on those conversations, and it also based on, I think, as we wrote, a order horizon from 3 to 6 months, right? I would say it's actually even spread across the three business, our outlook on orders, let me say.

If you take the Enterprise, does that mean that we should now expect that the sell-out of the customers, that has more or less normalized?

Yes.

It's strong market growing low single digit or something? That,

yeah. That is.

Again, as we discussed earlier, Enterprise is also subsegments, there are some that moves like retail, and there are others that might be lagging a bit.

Yeah. The retail is mentioned again as doing very well.

What

we could see from the annual report under notes that it's also become a decent size of the total Enterprise business. Can you put, if you have any insight, some words on the market potential for your client in the retail space?

Have they just scratched the surface? Is mainly a European business or?

By now, it is predominantly a European business. It's a business that holds also potential in the US, but also in the rest of the world.

The underlying transition is really the connection of the front-line staff across. As we see, if you go five years back and you ask to look in the crystal ball, you would actually have expected that number of front-line staff going significantly down due to internet shopping, closing down physical stores.

That has actually changed on the flip side of, I think, both corona, but also coming back and finding this omnichannel, saying if you want to be successful online, at scale, you also need physical profession. That omnichannel.

That's the underlying market trend. That's where Europe seems to be first runners on that, and there's still a lot of untapped potential in Europe.

Then there's a US market that is opening up at the moment.

Do they have any idea or getting any communication from the client if they are getting interest or traction from the US market? They're out to focus on the US to go in, but are you getting any indications of if it's also something that's going to show up for you going forward?

Yes, we are getting those indications that, of course, the partnership that we have in this segment is definitely pushing very strong also for the US, but also, of course, there are also US players that has the same needs for headsets, push-to-talk headsets. There're also opportunities for us broadening that out.

To go for new clients or whatever.

With different solutions. Yeah.

If we then move to ProAudio, you also talked about timing there, but to the positive for you.

Yeah.

You grow revenue year-over-year by 10 million. How much of that is then timing?

Yeah. What should we see as a normalized level?

Is that then 7 million additional from timing, so that it's more normal of the 20 we should go use as the underlying performance, or how much is?

I think it's difficult for us to say because we don't have quarters that are equal. I think that we would say that in the range of 4 to 4 to 8 million this quarter is something that we have received which could have been in Q4 last year.

In general, when I look at it, then instead of looking on a quarterly basis, then we should look on for a LTM basis running forward? Yeah.

Yes.

That's a more better way to look at it.

That's a better way to look at, yeah.

Yeah. That still there you have good traction?

Yes.

Uh...

Poul, there is a question from Erik Carlsen from KB. Just

a second.

Hi, thanks. Hi there.

Just a second. Now we can see that the hand's high up as well, Erik, go on.

Hi, thanks for taking my questions. I just wanted to understand a little bit your main organic growth opportunities for the next three years.

What do you think are the most important opportunities if we look into that timeframe? If you could just frame it in terms of products and/or market, where do you think you have the biggest opportunities?

Yeah. Definitely Healthcare.

The partnership that we have there with the market leader, the US market leader in patient monitoring systems for for high acuity patients, where we have a a partnership where we take over ownership that brings us into a position in the US market on healthcare is definitely a growth driver, and we should see significant growth in the healthcare segment over the next 3 to 5 years. That's definitely one element, and the underlying trend in that is of course, the aging population that and and the increase in cardiac patients.

I think the US Heart Association predict that over the next 8 years, they will see at least a 30% increase in the number of of cardiac patients. That's pushing the need for these solutions.

We we we have a a strong, focus on on harvesting on on that opportunity. That's one.

Then the second one is is really the the retail, this is these push-to-talk headsets where we equip, with our partners, the front-line staff both in terms of providing better better customer service, but on also more efficient operations, and actually also a value proposition about workplace safety, because, when you're there as a front-line staff, sometimes you receive abuse from customers, and being able to connect to to colleagues is actually quite an important quite an important value proposition there. Then, the underlying market part to Poul also touched on it, so that is really a a market segment where the number of frontline personnel, we don't we don't see and the indications are it's not going down, it's that's at a steady level for the next 10 years, and it's a population that has been underserved by technology and and communications technology.

A lot of these people run, at least in the US, with walkie-talkies and different communication systems. These push-to-talk headsets has really, changed the game for that, and also with a strong integration into their backend systems in terms of of being able to running more optimized business.

I think that that's the the two main main elements. Also what we actually, if I I am to make mention a third one, it's actually also ProAudio because as if couple of years ago we changed the business model from going from full products to a standardized business, which actually also meant that this business took a dip.

We had to change the customer portfolio. The sales price for a full product is of course higher than the one for for for a module.

The margin is higher, it's a better business model over time, but we have to build that business over time. That's also going to build some some growth into our business over the next 2, 3 years, definitely.

Hopefully that answer your question.

That's very clear. If I may, a follow-up just since you mentioned Healthcare first.

If you could just give what's the business model there, and what does success look like in terms of, let's say, sales in 3 years for that business, do you think?

The business model is that we own the IP of the communications infrastructure that's part of the Philips SmartView or IntelliVue smart hop in system. We provide the connectivity for the patient monitoring.

Every time that Philips deploys their solution, we deploy our products and receive payment for that. There's both replacement sales in that, and of course also market expansion from our partners in that.

It's also a model where we can actually both go to market in our own brand name if we wish to do so, but we can also do it in the Philips name, and we can actually also onboard other partners onto our technology. That is the development tracks that we're going forward.

In terms of numbers, what does success look like, at least it's three-digit revenue numbers with high margins within the next 3 years.

That's very helpful. Thank you so much.

A follow-up on that one. You talk about potential new clients next to Philips on your IP.

How is that going? Any progress?

It's early discussions. It's also it's going to take time.

We are convincing competitors to use the same infrastructure. We are in dialogues with that.

We also seeing that actually the Philips in the US are taking market share at the moment, which could be helpful in those discussions. To be honest, it is discussions we are engaged with, but it's slow discussions.

If a hospital implements Philips infrastructure and put your base stations into it, I assume that it's an open API which is on the devices, so that for instance, a Siemens or GE or anybody else who has a monitoring, they can connect to that solution, or how does it work? Do they need an agreement with you to have a interface into that solution?

Because I do not assume that a hospital will give Philips a monopoly on all equipment in the hospital.

Most likely not. On the other hand, hospitals are also looking at one system integrator, and today that's Philips, because they want to blame something if something goes wrong.

Right now it is actually all eggs in one basket, but we believe that's going to change over time, even in Healthcare. In principle, yes, the APIs open.

Right now they are doing their own proprietary solutions, but we believe that even in Healthcare that's going to change over the next 3, 5, 10 years. We believe that could be an attractive position for us in that over time.

Yeah. The EBITDA margin for Healthcare came down to the lowest level for a year in the quarter.

Is that product mix, I assume, from what to what? It will change over time, I assume, depending on what you're selling in, so...

It will change over time depending on what we are selling

in.

Then a large part of our capacity costs are allocated based on revenue split and direct pull. The things we made last year in order particularly in ProAudio to simplify the business model has also enabled us to move resources that were engaged in ProAudio before to Healthcare.

There's also a kind of an increased resource in Healthcare, their capacity allocation is larger. That also impacts.

Yeah. Makes sense.

If you go back to ProAudio then and look at the revenue, if you grow 60% and you have more modules and less products, then it's obviously also fair to assume that the modules are growing very fast?

In pieces, yes.

If you grow 60% and you are declining the number of products, where are you getting that traction? In what segments of the ProAudio are you getting that high traction on the modules?

It's split across. I think if you are to divide the ProAudio into two, there's what you call mics and stage, which is more wireless jacks for guitars, microphone, and so on, and then intercom, which is where you build TV into headsets for different teams.

Firefighters.

The firefighters, but also film crews, and of course also defense. I think we are seeing more traction on, but at also higher margins, in the intercom segment.

Are you already now shipping for the defense?

Yes.

Relatively small quantities. There's potential, but it's slow-moving.

We are seeing traction.

Erik, you have a question?

Yes. Sorry for asking a negative question, but it's always hard in this type of company to assess the technology.

What do you think are the main threats or challenges from alternative technologies that you see on the horizon? Can you just help us understand the landscape, so that would be helpful?

Yeah. Definitely.

If we start at a relatively high level, our position is actually to provide bespoke or proprietary communications infrastructure to environments where Wi-Fi and cellular and other broad-scale infrastructures either isn't present or it doesn't have the properties needed for the task. That's still moving, right?

The technology on Wi-Fi and cellular is clearly moving, so that's kind of eating our position. Our challenge is continuously moving our technology to areas where there still are special needs, and that's of course also why we are looking into Healthcare, why we're looking into critical communication, and so on.

That is definitely the challenge, and that of course pushes us to make sure that we continuously invest also into innovation and moving our technology base, yeah, to be able to service new niche applications in the broader, wide wireless communication market. That is the reason for us being here.

It's a really fair question. Then I see where things are actually moving.

It's also around the integrations. How does these bespoke or proprietary solutions actually integrate into backend systems?

For example, in the retail, how do the voice communication link into the inventory system, connecting with AI, picking up speech about, "Oh, we are low on inventory on this," so picking up that and actually feeding that as a data point into backend systems? That is definitely an area where we are seeing a strong push, also on the technology side.

Super. That's very helpful.

Thank you.

You're welcome.

I had two areas left. One is just clarification.

On the gross margin, there is no dollar impact on the gross margin. You buy and

sell in dollars, so that is

neutral. Euro.

Yeah.

The impact is truly on the operating cost being in DKK?

DKK

and euro. Yeah.

If you then move to the cash flow, and then you last four months it has 70 million in free cash flow, and 150 million cash pile. I'm just thinking about the way you think about your cash position.

Are you keeping that to have resources for strategic initiatives that could be more R&D and building products, new segments, or what's the thoughts on cash flow? Is it for shareholders or is it for investments in the future?

Yeah. Right now, as we published, we have a share buyback program that is running.

It's on 20 million. We are, give or take, halfway there.

It's of course something that we are discussing and, of course, it's the board that drives this, discussing what do we start another? On the other hand, it's also, of course, our business needs a quite solid cash position.

I think in our capital policy, it's 80 to 100, and of course, yeah, we are above that. Of course we are having these discussions.

On one hand, we are saying, how can we benefit the shareholders, and, for example, with share buyback, but of course we're also looking at what are the investments that we can do that will grow the business over time. It's a continuous discussion with the board both on seeking investment opportunities, but also, of course, how do we serve the shareholders best possible.

If you are looking at the investment, is that then to enter new segments, or is it Healthcare looking into decentralized monitoring or where are your thoughts about how you should want to?

I think and also I think we kind of put this into the annual report. Definitely Healthcare is an area where we are investing and where we're also seeing that, given the market attractiveness in terms of both demographics, but also investments and also price levels and potential for margin gains in that market, it is an attractive market, definitely this is one area where we are looking for potential business cases to invest in, but also in other segments.

It's always looking at what is an attractive market at the end. Healthcare is definitely on the radar, but we are looking broadly across our business.

That's a key feature of our business model. We have a technology that can be used in many different segments, and it's up to us to find the right markets where we can both differentiate, but we can also make a decent profit and scale that, yeah.

Thank you. I have no further questions.

Just are there any questions on the line? Otherwise, we will wrap up here.

Does not seem so.

Thank you for all your questions. Thank you for coming.

Have a good weekend.

Have a good weekend.