Good morning, and welcome to Incap's webcast covering the fourth-quarter and full-year 2025 results. My name is Paulina Tennilä, and I will be hosting this webcast.

Joining us are Incap's President and CEO, Otto Pukk, and CFO, Antti Pynnönen. Otto and Antti will walk you through the results, after which we will go through your questions.

You can post your questions at any time using the Q&A function, and a recording of this webcast will be available on Incap's website later today. With that, I'll hand it over now to Otto Pukk.

Thank you very much, and and from my side as well, welcome, and thank you for everybody listening in. It's always nice to to have so much interest of what we're doing in Incap.

I will walk you through the the a little bit of the of the result and and with with Antti give the numbers, and then then we will take Q&A as as normal like we do. Yes.

Very good. If we look at at the year, the year ended as we expected.

We We did a correction in in in during the year, and and after that, it followed that course. In the big picture, we are are happy with with that the outcome came in as we expected.

We continue to to invest and develop the the operations in Incap, and and that we take great pride in to to keep keep doing. Of course, a big part of the in in a part part or a big big event for us in the in the end of the year was the acquisition of Lacroix that you saw now closed here in the beginning of of the year.

That of course will will we're very excited about moving forward, and I will talk a little bit more about that in a while. Then of course, 2025 was also our 40-year jubilee year, also that rendered in some some extra activities and and a little bit festivities in in the different units, which is of course always always positive.

Overall, I think we had an great EBIT percentage, again hitting almost 12%, and and as I said said, we we ended as we expected. The result, like we talked about last quarter release, of course, is impacted by by some foreign exchange rates and and and so as well.

This Antti can open up more to during the Q&A if there's still questions about it. I think you saw a a nice recovery during the Q4 on that that, the impact was less.

Antti is happy to answer questions regarding that. As I said, Lacroix is is was was a big step for us, and and and we're very excited about that.

This strengthens Incap's position in several sectors, among those defense sector that of course has been talked about a lot here during the past years with the geopolitical situation that we we we have, but also gave us more capabilities in form of design capabilities as Lacroix is is has ODM capabilities as well, and also giving us a better reach into the DACH area and and and to the big industrial centers of Europe. This we're very excited about.

Also, I must say that I'm very happy with the interactions that we have had with Lacroix team. It seems to be that we are are sharing a lot of the the the culture and and and the way we we work, and and it has been a great start with the integration work and and and all the workstreams that we are are working on currently.

This this we look forward to very much during the year to to continue to integrate them and develop the business among it ourselves, because for of course, the service offering for Lacroix's customers has increased by being part of the bigger Incap family, and also the service offering and and and the value proposition from for Incap's customers is increasing thanks to the capabilities that Lacroix has. A warm welcome to to all of them.

They will be Incap Germany and Incap Romania, so soon we won't talk about Lacroix in that sense, but I do this still this one. Yes, that is a big thing.

I mentioned investments, and we have during the year kept on investing in our facilities, and and and this is something Incap take great pride in, that if we want to produce the latest technology for our customers, then we also should have up-to-date technology in in the factory. Sometimes you walk around in EMS factories, and you see equipment that is 20, 30-year-old, and and and, yeah, then you have been too late in changing it.

In Incap, we we are working very actively with programs to update our platforms and and update the things we do, and and and this also gives result when we service our customers. Sustainability, the the demand for for sustainability reporting have gone down from the European Union side, and so still we have decided to continue our reporting in Incap and and do it perhaps to a little bit more more reasonable extent, but but but still, sustainability and and and the thinking of what our footprint is in in in the world when it comes to to environment and social and and also governance issues are are very important for us.

We are a value-driven business, and and this is is very much in the core of what we're doing. We have continued to develop, we have continued to to update our our reporting.

We had very interesting investments that have been driven now as well with solar rooftop panels in in in many of the factory. As you perhaps remember, I'm very excited over the investment we are doing in in our US factory, where we will be basically self self-sufficient in when it comes to electricity through our own own solar park, in that sense.

This this is something I think is is interesting and and very close to to our way to drive business, is to take responsibility also in the bigger picture of what we're doing here on on planet Earth. Quality and our team is, of course, the cornerstone of our business.

We have continued to develop different management structure structures and management systems in in in the company that are focusing on quality. US here finalized here work environment and environment certificates during the year, and and we are continuing to work that in in all units.

Also, I must say that that when it comes to our people, then then we can never praise them enough. We have excellent people all over the world servicing our customers and and creating value.

It's always a pleasure to move around in the different units and and meet these peoples that are actually the ones doing the electronics, not like us in the headquarters, just reading about it, in that sense, in the numbers. That said, I'll give the word to to Mr.

Antti Pynnönen. Take it away.

Excellent. Thank you so much, Otto, once again.

If we take the first slide with focusing on the Q4 figures. What we reported there was 55.3 million revenue, 6.9 million EBIT, and then that contributes 12.5% in EBIT-wise.

Then what we wanted to highlight as well was what Otto briefly touched earlier was the impact of the exchange rates. Then we included the text that with the comparable rates, the revenue was 58.8, then it was a 3.5 million impact there in the reporting.

Then, yeah, that's in that sense worth to mention, because with this comparable rates, basically, we were matching pretty nicely with the Q4 2024 figures. What we can really be proud of is, of course, the profitability.

Then we had this Q4 impacted by acquisition-related costs, almost 1 million. Then if we add just those back, then we reported adjusted EBIT of 8 million, which is excellent of 14.4%.

Solid, delighting end for the year. We can move on.

Here we can see the graph. As we can see, then, the Q4 pretty much nicely bounced back from Q3, matching the levels of the second quarter of the year.

Then indeed, it was a good solid growth in the profitability as well in the last part of the quarter. The table here summarizes some of the key metrics we have.

Interesting, of course, always to measure the inventory values. There, we had some good development.

What Otto preaching a lot of on the efficiency of inventory management, and there has been a lot of actions in the all units to optimize that level. Then we can see that it went down to 52 million euros in the last quarter.

Our financial position is indeed extremely strong. This is, of course, in the end of Q4 status of -52.9 million interest-bearing net debt.

That is very good for Incap, and we remain very flexible in terms of the financials. The personnel head count number summarized on the right side.

There, we have some swings here and there. Some units a little bit went down in the head count, like we mentioned, Slovakia number went down from year-on-year knob level and so on, but 2,614 people overall.

Yes, and then back to the outlook. We have, as reported, we expect to be clearly higher than in 2025, both when it comes to the revenue and the comparable EBITA.

Of course, this takes into account both the Lacroix acquisition and also the growth we are expecting from the old Incap units. Then, I think we are ready for the Q&A session.

Pauliina, take it away with the questions.

Thank you, Otto and Antti. I think one of the first questions is that since you have such a good situation on your balance sheet, why are you taking a loan to pay for the Lacroix acquisition?

No, that's a good question. Now, of course, we are focusing very much on the integration of Lacroix.

Still, our growth in that sense story, we haven't expected to end, and once we have successfully integrated Lacroix, we expect to continue on the M&A track as well, and for that, we need firepower. That is shortly what that is all about.

You should see this perhaps in a more long-term and in bigger picture. Antti, do you want to add something?

I think it's from my perspective, really managing risks and then also managing potential opportunities as those arise. Then what I'm referring here is, for example, we have to be ready immediately if some of our big clients start ordering and their business keeps developing to the positive direction, and our production volumes rapidly goes up.

We must be able to finance very, very fast net working capital increases. We saw that 2022 with India of increasing volumes in 100 million, and think about how much cash was needed immediately.

There's no time to start discussions. This is preferable this way, that we remain flexible in the financials and on top of things.

Then what Otto mentioned, of course, when there's major size opportunities in inorganic way, acquisitions and so forth, then we again, time is money. Then the companies who are able to react fast and have solid financials in place to sell to the seller party and counterparty, then you get the credibility as a buyer and things like that.

Plus then, of course, there's going to be loan amortizations coming up in the plans and so forth, but yeah, I think we just prefer to have some buffers rather than keep too lean.

Thank you. Maybe the next question about outlook, and there's a question about if there's any way you could give some color on the organic growth part of the guidance, and what is the foreign exchange rate impact on this clearly higher guidance?

We haven't reported it separately in that sense. Of course, the previous Lacroix numbers on their performance the past years we shared with the acquisition, I guess you can do some back-bracket.

We haven't shared that detailed in it. I don't know, Antti, you want to comment on the exchange rate

then? We don't speculate with the exchange rate, so that is reflected the latest development there, and then basically with the current exchange rates, that's the steering we gave.

Thank you. This congratulations on great Q4, great margins.

One question is that how is your current order book in the coming 3 to 6 months?

Thank you very much in that sense. First of all.

No, we are not reporting our order book separately, but of course, as we're expecting growth, and we're expecting, yeah, both through, of course, the Lacroix add-on, but also generally, then of course, that reflects also in our order book as our forecast is based on our actual order book, and also then firm forecast from our customers. If that perhaps answers the questions indirectly.

Thank you. How about your defense exposure?

You have now said that it will be growing with the acquisition of Lacroix, what do you expect to it to be in the future? How much of your net sales will come from the defense sector?

Still our exposure is not, even with the add-on of Lacroix, is not now very big in that sense. We're not dominated by defense, and we think it's very important to keep the company balanced.

I know there is a big race currently on defense, but it's also important to think about times after. That said, we expect our defense share to increase here during the year and during the next year as well, as many of our major defense customers are expecting to grow with different programs.

That is Antti, do you want to comment on the percentage? It's not that big currently, but expected to grow.

You're right. If we include some expected defense customer growth for this year, and then some Incap unit-level development programs we have there.

Combining it all together, we are still, yeah, we are under 10% still on the group level, quite nicely.

Thank you. There's a question related to this, a little bit to elaborate on the expected revenues for 2026.

I'm not sure if this means a little bit sector by sector, maybe, if there's anything to comment on the different markets and their impact on your demand?

No, we are not reporting sector by sector per se, but as I have said before, defense and what is around AI data centers, that is currently growing, and we see with our customers as well growth around that. Then there is some growth in other sectors as well, but that is more on a company level.

I would say that in general, I'm quite positive on our expectations when it comes to this year, and as we said, we expect growth, and that also organically and inorganically. Overall, I think we will have positive development in many sectors.

Thank you. How about you mentioned that there are some personnel reductions in Slovakia.

What was the reason behind those reductions?

No, there we discussed that also in the beginning of the year, that there was some postponements of some customer projects, and we are always balancing and trying to fit our capacity according to what is the demand for the moment. This is a part of being an EMS company, is to increase capacity and reduce capacity when needed.

That was what happened in Slovakia as well, that we took down the capacity to match the demand. It goes up and down.

I wouldn't say that is anything in particular. We do that in all units, and it goes both ways.

We increase and decrease.

Moving on then to India. Could you give some kind of an overview of the growth in India?

India is developing very nicely, and we mentioned here earlier in the Inderes videos and so when they were visiting us as well a little bit, gave a little bit flavor on the projects that we have ongoing there, and I think it's a positive development. We have new big customer accounts in India that we are developing and ramping up, and balancing out our largest customers that has its manufacturing in India as well.

We have had a positive development. I wouldn't say that our third factory is full yet, but walking around, there's a lot of activities.

Very good. In case there's no further questions online, then I think we can start to wrap up.

Would you like to wrap up the year 2025 still once more, Otto?

Yes, sure, I can do that. The year ended as we expected after the adjustment we did.

I'm very happy for the performance of our team. We have great people all over the world, and that is really burning for electronics, and it's in that sense not an understatement that we have a bunch of electronic rock stars in Incap.

I look forward for this year, and I think with the addition of Lacroix and the great development that we are foreseeing in the different units, it's an exciting year for Incap and to continue to develop the business, and that with new team members and all what that brings. I'm very thankful for the interest from you guys, the investors, that we always have a big audience when it comes to our webinars, and I encourage you all, if you have questions and so, reach out to me and Antti.

We always try to find time to meet with investors and have talks, or in smaller groups as well, I encourage you to do that. Until next time, and thank you very much, guys.