Earnings call transcript: Envipco Q4 2024 reports steady growth

Envipco Holding NV (Market cap: $345.64M) reported its fourth-quarter and full-year 2024 financial results, meeting expectations for earnings per share (EPS) and slightly surpassing revenue forecasts. According to InvestingPro analysis, the company currently appears overvalued against its Fair Value estimate, despite showing strong financial health with an overall score of "GOOD." The company reported an EPS of $0.03, aligning with analysts’ forecasts. Revenues for the quarter reached €36.4 million, reflecting a 3% year-over-year increase, while full-year revenues climbed 35% to €117.8 million. Despite the steady performance, Envipco’s stock remained stable in immediate trading, with no significant price movement observed during the open market phase.

Key Takeaways

• Envipco’s EPS met expectations at $0.03 for Q4 2024.
• Quarterly revenues slightly exceeded forecasts at €36.4 million, a 3% increase YoY.
• Full-year revenues saw a substantial rise of 35%, reaching €117.8 million.
• Gross margins improved to 36.6% for the full year, up from 34.5% in 2023.
• The company’s stock price remained stable post-earnings release.

Company Performance

Envipco demonstrated solid growth in 2024, significantly increasing its revenues by 35% year-over-year. This growth was supported by advancements in recycling technology and expansion into new markets. InvestingPro data reveals impressive last twelve-month revenue growth of 78.44%, with analysts expecting continued sales growth in the current year. The company’s gross margin also improved, indicating enhanced operational efficiency, while maintaining a healthy current ratio of 2.0, suggesting strong liquidity management.

Financial Highlights

• Revenue: €36.4 million in Q4 2024, up 3% YoY.
• Full-year revenue: €117.8 million, a 35% increase from 2023.
• EPS: $0.03, matching forecasts.
• Gross margin: 38.4% in Q4; 36.6% for the full year, up from 34.5% in 2023.
• EBITDA: €5.4 million in Q4; €12.8 million for the full year.

Earnings vs. Forecast

Envipco’s Q4 2024 earnings per share of $0.03 met analysts’ expectations. The company’s revenue of €36.4 million slightly outpaced the forecast of €33.2 million, indicating strong performance in its core markets.

Market Reaction

Following the earnings announcement, Envipco’s stock price remained unchanged during the open market session. While the market response was neutral, InvestingPro analysis shows analyst consensus is bullish, with price targets suggesting significant upside potential. Subscribers to InvestingPro can access 12 additional exclusive ProTips and comprehensive valuation metrics for deeper insights into Envipco’s investment potential.

Outlook & Guidance

Envipco is optimistic about its prospects for 2025, expecting back-end loaded revenues. The company is targeting a gross margin of 40% and aims to expand its market presence in Europe and the US. This optimism is supported by InvestingPro data indicating expected net income growth this year, though investors should note the company’s relatively high P/E ratio of 123.26. For detailed analysis and growth projections, investors can access the comprehensive Pro Research Report available exclusively on InvestingPro. Key markets for deposit return scheme (DRS) implementation include Poland and Portugal.

Executive Commentary

CEO Simon Bolton highlighted the company’s growth trajectory, stating, "We’ve gone from €38 million to now €117.8 million," emphasizing the successful implementation of Envipco’s strategic initiatives. Bolton also expressed confidence in the widespread adoption of DRS, saying, "It’s now a matter of not if, but when [DRS] will be implemented."

Risks and Challenges

• Implementation delays in new markets like Poland could impact revenue growth.
• Increased operating expenses, which rose 26% YoY, could pressure margins.
• Potential regulatory changes in key markets might affect business operations.

Q&A

During the earnings call, analysts inquired about the company’s market share and margin targets. Envipco confirmed its confidence in achieving these goals and highlighted the flexibility of its business models, which include purchase, rental, and throughput options.

Full transcript - Envipco Holding NV (ENVI) Q4 2024:

Simon Bolton, CEO, Inbivco: Well, good morning, everyone. It gives me great pleasure to welcome you to the 4Q twenty twenty four presentation by Inbivco. I’m Simon Bolton, CEO of Inbivco. And I’m joined by my colleague, Michael Clement, Chief Strategy and IR Officer. And we’ll go through an update of the business and then opportunity as normal to address any questions you have with a Q and A at the end.

Okay. Next slide, please. So, solid end to 2024. Group revenues, as we announced earlier this morning, 36,400,000.0, which is 3% higher than a year ago on a very high Q4 ’twenty three comparable. Overall then, group revenues 2024 came in at 17.8, which is 35% growth year on year and definitely underlines the strong progress we’re making as a business as we develop and execute on our growth strategy.

Gross margin was very pleasing. A lot of work that we’ve done, as you know, those who have followed the business, as we target improvement in gross margin. And in the quarter, it was 38.4%, giving gross profit of $14,000,000 Overall then, EBITDA was 5,400,000 for the quarter, which is just under 50% margin. And cash balance was just over $30,000,000 dollars So positive work on working capital, which Michael will tell you about later. Overall, operational highlights, as I mentioned, we continue to grow and execute in our existing markets.

Solid operational execution shown by good gross margins, good working capital management. And as we’ve talked about over several quarters and will summarize again in this presentation, really a fantastic unprecedented opportunity ahead of us and we need to continue to invest to be able to capture that. Highlights really for this quarter, excellent performance in Romania, actually our single largest market in the quarter and continued great work in Hungary as we complete the delivery of the first phase of that particular project and also strong contribution from Greece and Ireland. As we have highlighted before, our focus is really on greenfield new markets. But there are opportunities for Invidco’s technology to help in brownfield markets.

We’ve been in Sweden a long time, for example, and we see some other opportunities. Most recently, The Netherlands, which has issues with particularly the introduction of cans into the deposit return scheme, that’s now starting to use our quantum product to increase their recovery rate. And that’s an exciting opportunity, an example of what we’re doing in brownfield. As mentioned, we’ve made careful and focused investments in the team, in markets, in product development, and we’ll continue to do that as we look to be able to execute on the terrific exciting growth ahead. And as announced just before Christmas, we uplisted from the growth market in Oslo, which we joined in 2021 to the main market in Oslo.

And we believe that’s the right thing to continue to develop and solidify our profile in the international financial markets. Maybe for those who are joining for the first time, a quick recap. So, we are a recycling technology business. We’ve been around just over forty years. And our focus is the delivery of products and services that support the recovery of beverage containers normally in markets, countries that have implemented a deposit return scheme, so called DRS.

And this is to improve the recovery of those materials and obviously the use of that material in new containers. Driven by legislation, we see ahead of us unprecedented growth in this market as we go to 02/1930 and beyond. We’ll talk a bit more about that later. Over the last few years, we’ve proven that we can capture a leading position in European markets, fantastic efforts in Romania, Hungary, Malta, and so on. And based on our broad product portfolio, we’ll continue to invest in in this platform, which includes for us both the product and also the services.

We invested in the team. We have very nice mix of industry veterans and also newer people who are coming into the team. And we feel those four things will deliver revenue growth and increasing profitability. So with that, a pleasure to hand over to Michael, which will go through the financial review. Michael, over to you.

Michael Clement, Chief Strategy and IR Officer, Inbivco: Thank you, Simon. So let’s start out with the profit and loss statement. Q4 revenues, as Simon mentioned, EUR 36,400,000.0, up 3% from EUR 35,500,000.0 in the corresponding quarter last year. Remember, Q4 ’twenty three was a record quarter for the company at that time. Gross margins continued to widen.

In Q4 last year, ’30 ’8 point ’4 percent, up nearly 400 basis points year over year, driving gross earnings of million. In Q4 twenty twenty four, operating expenses were million, up from million in Q4 ’twenty three. I’ll come back to that bridge. EBITDA this quarter, million, includes million in non recurring items such that adjusted EBITDA in Q4 ’twenty four was million for a margin of 16.4%. Operating earnings in Q4 ’twenty four were million, down from EUR 3,800,000.0 in Q4 ’twenty three with net earnings after tax of EUR 300,000.0.

For the year, revenues were EUR 117,800,000.0, a growth of 35% from 2023, driven by growth in existing and new European markets. Gross margin for the year ended at 36.6%, up nearly 200 basis points from 34.5% in 2023, with EBITDA for the year at €12,800,000 and an adjusted EBITDA of €14,400,000 So with that, let’s take a closer look at the underlying revenues. First of all, Europe. Revenues in Europe in Q4 ’twenty four were EUR 27,300,000.0, down 2% year over year. Our VM revenues were EUR 24,800,000.0, with Romania being the strongest growth driver in the quarter.

Romania actually being our largest European market in the fourth quarter of twenty twenty four. However, Hungary showed good sequential progress and a very important revenue mix in the quarter, also the same with Greece. Programme services still make up a very small portion of our European revenues, but growing very nicely. In Q4 ’twenty four, program services in Europe were EUR 2,500,000.0, up nearly fourfold from EUR 600,000.0 in the corresponding quarter last year. For the year, European revenues were million, up nearly 50%, driven by 43% increase in RBM sales and nearly threefold increase in program service revenues.

Our North American business is a much more mature business, a business in which we have been since the early 1980s. In Q4 ’twenty four, revenues in North America were EUR 9,000,000, an increase of 22% from EUR 7,400,000.0 in Q4 ’twenty three. One driver are increased program services revenues, up 12% year over year, driven by the doubling of deposit in Connecticut, driving higher collection volumes. RVM sales in the fourth quarter were million, an increase of 183%, partly on an increase in spare parts sales. For the year, North American revenues were million, an increase of 9%.

And Bibco is positioning in European growth markets, and we need to position ahead of DRS Go Live. We continue to do that in selected markets in Europe, and that is partly driving our increase in operating costs. This quarter, operating costs were million, up 26% year over year. The drivers are new hires, increasing OpEx and the introduction of Sensibin amortization of intangibles and also accruals on our long term incentive plan. Nonrecurring items this quarter from the uplisting on the Oslo Stock Exchange and the Sensibin acquisition acquisition related costs were EUR 500,000.0.

Adjusted for this, operating costs this quarter were EUR 10,700,000.0. For the year, our operating costs were million, up 36% year over year. Bridging our OpEx from the previous quarters. In Q3, we reported EUR 10,000,000 in operating costs, including EUR 1,100,000.0 in nonrecurring items from the Sensitive acquisition and the uplisting on Oslo Stock Exchange. Underlying OpEx in Q3 was thus million.

This quarter, we have increased amortization on the Sensibin acquisition of We have long term incentive plan accruals of EUR 700,000 and then new hires on underlying OpEx increases of roughly EUR 600,000. For an underlying OpEx level of EUR 10,700,000.0, adding the EUR 500,000.0 in non recurring items, EUR 11,300,000.0. So let’s move over to our balance sheets. Our balance sheet total increased by around EUR 4,000,000 to EUR 29,400,000.0 this quarter. Our non current assets were close to EUR 40,000,000, up around EUR 3,000,000, largely made up of property, plant and equipment, roughly half that, EUR 20,000,000, and intangible assets of EUR 15,000,000, largely from activated development expenses and also some intangibles from the Sensibin acquisition.

Current assets were at €89,500,000 Inventories €28,600,000 down around €4,000,000 with accounts receivable €30,100,000 up around €3,500,000 Our cash increased by €2,000,000 to 30,700,000.0 Equity ratio this quarter flat with the previous quarter at 52%. Our noncurrent liabilities, EUR 16,400,000.0, fairly flat with the previous quarter, of which borrowings were close to EUR 6,000,000. Our current liabilities were at €45,400,000 up from 44.1 in the previous quarter. Trade creditors were at close to €17,000,000 flat sequentially. Finally, let’s have a look at our cash flow.

First, for the fourth quarter. We started out with EUR 28,700,000.0 in cash at the end of Q3 and ended up with 30,700,000.0 in cash at the end of Q4. Our cash from operating activities gave a positive cash flow of €5,700,000 driven largely by our EBITDA generation. Our cash flow from investing activities this quarter was €1,700,000 negative, driven by CapEx of €1,100,000 largely from piloting equipment, from leasing equipment and IT investments and also some capitalized R and D of EUR 600,000.0. Our cash flow from financing was a negative EUR 2,000,000 in Q4, driven both in a reduction of borrowings and lease liabilities.

Then over to the cash flow for the year, increasing our cash balance from €12,500,000 at the end of twenty twenty three to €30,700,000 at the end of twenty twenty four. Cash flow from operating activities last year were a positive EUR 1,200,000.0. Our CapEx was EUR 6,500,000.0, driven by underlying CapEx of EUR 5,000,000 and capitalized R and D of $1,500,000 So our total CapEx in 2024 was at 6% of revenues compared to 8% of revenues in the previous year. In addition, we had a payment of €1,500,000 for the Sensibin acquisition in Q3. Cash flow from financing activities in Q4 in twenty twenty four were EUR 25,000,000, driven in large by the private placement in March of EUR 24,800,000.0, ending the year at EUR 30,700,000.0 in cash.

So with that, Simon, I think I’ll leave the word over to you again for a look into the future prospects.

Simon Bolton, CEO, Inbivco: Very good, Michael. Thank you very much. So, yes, just we’ll go through an outlook. Look, I think the key thing to say and those who follow the business for several quarters will have seen this is I think we’ve got now some really good proof points that we’re delivering on our European growth strategy. Just here is development of revenue of the business from 2018 to 2024.

The bottom gray is North America, then you have Europe on top. As Michael said, solid growth in 2024 from North America as a mature business. But really as these that growth is being driven by these new markets as they come on, and that will continue over the next several years as effectively people need to address and countries need to address the legislation that is now in EU law. And that legislation, which we have talked about before, that’s now fully approved. So the last year, the council approved the law and that’s now into EU law in December.

As a reminder, that sets clear targets for the recovery of beverage containers, 90% to be recovered by the 01/01/2029. And it and importantly, it sets minimum recycling targets for the beverage industry. So not only must the government set up a system to recover this material, these containers, but also the beverage industry, there’s a demand there for the recycled content. So that’s a fantastic link and that drives the system. And the best way of doing that and is clear in the legislation is that’s to put in a deposit return scheme as you have in a number of countries in Europe at the moment, but will be prevalent in all EU countries.

Outside of EU, UK, for us, a very important market. That, that UK legislation also passed over the last few months, and that mandates a scheme to be in place by the third quarter twenty twenty seven. And, certainly, there’s excellent activity by The UK Government to continue to maintain that timeline with probably the next milestone being the DMO, so the operator of the system, being appointed in spring of this year. So maybe taking a slightly further look, a longer term horizon, you see here on the left hand side really a snapshot of our revenue growth over the last few years. So really, the European growth strategy being executed and that actually coming into tangible results for the business.

The next few years are going to be very busy as those countries that are looking, legislating for actually implement a deposit return scheme and obviously needs the goods and services, the machines that we as a Vitco can provide to them to help make the deposit return scheme a reality. We’ve looked at market in a few different ways. I think you’ve seen industry estimates before of roughly a hundred thousand units tripling over the next few years. A different way of looking at it is actually the population that served through these new deposit return scheme markets. So the last few years, Hungary, Romania and so on, has probably covered about 42,000,000 in terms of population.

Over the next three years, about two seventy eight million people will be in countries that will implement a deposit return scheme. And over the next five years, that adds about another 148,000,000 people. And roughly the population is proportional to the number of reverse vending machines, the number of recycling points that that country needs to be able to cope with that return volume. So that’s very exciting and a rule of thumb is probably about 500 RVMs per 1,000,000 population. So next five years, that’s 200,000 to 250,000 units, which correlates well with industry estimates from before.

So very exciting times ahead. Maybe a little bit more specific, we have updated this slide a little bit. Effectively, all of the key all of the key countries, all of our target markets continue to work diligently to implement a deposit return scheme. So the key markets coming up are Poland and Portugal. So certainly, Poland, there’s been several announcements, but but the president signed off that the scheme will go live, but it won’t be earlier than the October 1.

But we still see a lot of activity in the country and that’s an interesting market. Portugal, again, continues to work at pace and we expect that scheme to go live beginning of the beginning of twenty six. Czech Republic slightly later in ’27, and then later on in ’27, as I mentioned, The UK. And then we have a number of other markets, who have announced go live dates or are working diligently on systems. Some of these like Spain and France are very significant large countries and we’re exciting about those growth prospects.

As I mentioned earlier, we our focus is on those new greenfield markets, but we keep an eye on brownfield and obviously we offer our technology support and help when we can support a system to improve their recovery rates. So a couple of quick examples here using Quantum. So Netherlands, we installed our first machine in March. And in the first year, it’s already done 3,500,000 containers, which is a fantastic result. And the local team give the customer a cake every 1,000,000 containers.

So, they’ve received quite a few cakes and hopefully a few more to come. And we continue to follow-up on opportunities with different customers in The Netherlands and that’s quite exciting step by step as we go through the years ahead. USA, as Michael said, there’s a number of refresh going on in different deposit markets and that offers opportunities for entrepreneurs, different customers to put in larger kind of bulk machines like the quantum. So, we’ve delivered our first units in The USA and we expect that again to be a market that’s interesting for us in the years ahead. So, just before we finish, really a summary of where we got to over this the first few years of our growth strategy.

So, the key thing is we’ve delivered significant growth. So, we’ve gone from 38,000,000 to now 117,800,000 increased margins. That is something that we’re focused on. And we have an opportunity with this very significant market opportunity ahead to capture 30% plus market share, which is one of our ambitions, and we’ve got proof points that we can do that. And in terms of gross margin development, that’s something that we’re really focused on.

We see continued opportunities as we scale the business to do so. And we also expect with growth, there’ll be continued operational leverage opportunities within the business. Overall then, these will continue to drive the top line and also continue to drive development of us as a stable and sustainable profitable business. And I think that’s it for the presentation. So I think, Michael, if there’s any questions, we could certainly take those down.

Michael Clement, Chief Strategy and IR Officer, Inbivco: Sure. I’ll have a look to see what’s come in here. And, yes, there are a few questions coming in already. I’ll just start from from the top. You mentioned that your targets will be refreshed in 2025.

Do you still expect to reach the target in 2025? Then I guess the question refers to the ambitions released in 2021, Simon.

Simon Bolton, CEO, Inbivco: Yes, exactly. So we when we listed on Oslo Growth, we had three ambitions. One of them was to, I guess, prove we could pivot to Europe and capture 30% plus market share. Yeah. And I think with the efforts we’ve done in Hungary, in Romania, in Greece, then I think I think we’ve done that.

I think it’s a very good basis. The other the other target was to really work on gross margin, making sure we’re getting the right price for our technology and also doing the right work as we scale the business on the costs and the efficiency of delivering our products and services. And you can see we’ve had a nice development, a quarter on quarter. Q4 is 38.4% as quarter and that ambition was as we exited 2025 should be 40%. And the other ambition really was on top line growth.

So and the combination of the markets we, we thought we, we understood coming or we predicted coming and also that market share that would that would give the top line growth. Look, we’re still, that’s still our that’s still our ambition. Obviously, we are subject to the timeline of some legislative processes. And at the moment this year, particularly, Poland and Portugal. So it’s we are ready.

We have the people. We have the production capacity. We have the technology. We have great discussions with customers. But really, it depends on certainly the timing of when those particular orders will be received and delivered, depends exactly, you know, the revenue within the quarter.

And there will be some fluctuations up and down with that. Obviously, what we’re looking at now and hence the comment in the report that we will be announcing longer term targets to 02/1930 is we’re getting much more visibility now, and we have a stronger legislative backdrop to the other countries that are coming up. So we expect a continued, very exciting growth over the next few years. Yeah. In ’twenty five, but also going to 02/1930.

Michael Clement, Chief Strategy and IR Officer, Inbivco: Good. Can you comment on the expected business model mix in Poland, throughput versus sale and service, maybe also leasing, I guess? How and how will this affect your capital binding and competitive strengths?

Simon Bolton, CEO, Inbivco: Yes. Yes. Yes. That’s a good question. Look, I think a few things.

First of all, we’ve always been we’ve always had the position that we want to do what’s best for the customer to kind of solve their problem. And, most of our customers, as you know, are retailers. And suddenly, they, you know, they’re involved in the scheme. They’re involved in this legislation, and they find working within Vibco very helpful as a partner to understand what is the best solution. And part of that is what is the best, best business model?

Is it to buy the equipment with a set with a service contract? Is it rental? Is it throughput models? And we do all of those. We do, for instance, throughput models.

We have examples in Europe and we do a lot of that in The US. And we’re pretty agnostic what type of model the customer wants and, you know, whatever fits best with them. We find that most large European customers buy the product. But again, we would support any type of model. And of course, you know, where that’s at scale, then we have a number of partners that can help us with those, you know, throughput or or lease type portfolios that we could use if necessary.

So we don’t see, we don’t see certainly our capital structure or size of our balance sheet being certainly a hindrance to offer any of those models of scale. And certainly, we’ve we’ve got active RFIs and RFPs with customers like in Poland on several different formats of what they want to what they want to buy. Yep.

Michael Clement, Chief Strategy and IR Officer, Inbivco: Good. Can you elaborate on the revenue phasing through 2025? How do you expect your revenues to grow through the year? I can address that, Simon. We expect 2025 to be another year of back end loaded sales as we saw last year, likely maybe even with a stronger effect than we saw last year, largely due to the phasing in of new markets such as Poland and Portugal anticipated in the second half of the year.

So a slower start in Q1 coming off back of a very strong Q4 and a growing trend through the year. Let’s see here. Assuming revenues in Poland and Portugal in the first half, when would you typically see firm orders? Simon, would you like to address that?

Simon Bolton, CEO, Inbivco: Yeah. Certainly. So, the it depends a bit on the retailer. So the customer, how far ahead they plan. Obviously, we like it as far as possible.

We think that’s the best way for good implementation of a system. But we see several customers where there’s a longer implementation of technology. And we think probably a country like Poland, even though the start is after, after October, so end of this year, beginning of next, we think there’s gonna be a longer implementation period. So sometimes this is captured in some sort of frame agreement, which may be deliveries six, twelve months after that after that initial order or frame agreement. So we think there’s gonna be some of that in, in certainly Poland and Portugal maybe a slightly, you know, harder start at the beginning of twenty six.

So those, that order cycle may be more like six months versus twelve.

Michael Clement, Chief Strategy and IR Officer, Inbivco: Okay. Let’s see here. With 38% gross margin this quarter at still muted volumes relative to forecasts, do you see upside to your 40% targets? I guess I can take that, Simon. I mean, I think the 40% gross margin target is very reasonable.

Some of the underlying drivers to address few of the other questions here as well. This quarter and as we also saw in Q3, scale, clearly, volumes helping us. So we will see quarterly variations. So with lower activity levels into the beginning parts of this year, you should also expect slightly lower gross margins, but on an overall positive trend towards the 40% target. Longer term, I think we will have to revisit this, but I mean, in the medium term, our 40% target seems very reasonable to continue to expect.

Simon Bolton, CEO, Inbivco: Yes.

Michael Clement, Chief Strategy and IR Officer, Inbivco: Which markets in The US have you received the Quantum orders?

Simon Bolton, CEO, Inbivco: Yep. Yep. So that is so far so far the interest for Quantum has been in the, you know, strong Northeast markets, particularly Connecticut. So I think, as Michael said, the, you know, The US deposit legislation or so called bottle bills have been around since the eighties, and 5 US cents in 1980 was worth something in 2025. It is it is not really.

So doubling the deposit from 5 to for 10 US cents is a significant impact in in volume of 30 or 40% recovery, which is fantastic, which is why countries do it. And you’ll note that Sweden has also increased their deposit recently also to drive recovery. And so where there’s a higher volume, then a quick way to and a very efficient way to handle that additional volume is with our Quantum bulk feed technology. So initially, Northeast, but clearly where other states are looking to develop or improve their infrastructure like maybe California, then I think Quantum, is a really, really good solution for those customers. So so far in the Northeast, but, you know, once established, hopefully, that will be a technology platform that will go to other states.

Michael Clement, Chief Strategy and IR Officer, Inbivco: I see here. For clarity, is it fair to say that you are more confident around your current margin and market share targets versus revenue targets? Would you like to address that, Simon?

Simon Bolton, CEO, Inbivco: Yeah. Sure. You know, I think we are, I think we’re confident about all our ambitions, to be honest. I think we’re confident about our ability to take 30% market share. We’re confident about our ability to drive to 40% gross margin.

And ultimately, that will with the markets coming up, that will generate top line revenue growth. And certainly, we, you know, we our ambition remains four to six x versus 2021. And just as when the timing will be, And that’s something that we can’t control. We’re at the, you know, we are at the behest of legislative processes. You know, as we’ve said all along, it’s now a matter of not, if, it will be implemented.

It’s a matter of when it will be implemented. And the timing of that may, you know, move some of, the revenue from one quarter to the other or move it from one year to another. But certainly, our revenue growth, you know, we maintain, you know, great confidence in because of all of the deposit schemes that are coming up, which, which we kind of went through in some detail in the presentation.

Michael Clement, Chief Strategy and IR Officer, Inbivco: Yep. Good. And then we have, we’re closing in here, Greece. Greece has announced plans to introduce ERS late this year. How do you view this event in light of your current installed base and operation in Greece and your market position?

Simon Bolton, CEO, Inbivco: Yes. We have had a, we work through a partner in Greece and we have you know, developed a, you know, very interesting pre DRS, infrastructure using quantum, and also ultra our ultra glass machine. And that’s been very successful and if you like has accelerated the recovery of beverage containers within the country. And certainly, you know, we’re you know, it’s very interesting to hear that, certainly there’s plans to introduce a deposit return scheme. And certainly, you know, obviously, through our partner, you know, we’ll be following that closely.

Whether that’s in ’twenty five, whether that’s in ’twenty six, obviously, that the detailed timeline is to be kind of published. But certainly, we’re in the market. We, as I think everyone knows, we do final assembly of the products in Greece. We think that’s very helpful. And certainly, we would expect to continue to develop and grow our business in Greece in the years ahead.

Michael Clement, Chief Strategy and IR Officer, Inbivco: And then we have a final question. Last one. Can you elaborate on the decline in inventory? I can take that. I guess, I mean, working capital management has has been a clear focus, both through 2023, you know, coming off of the delay in in Scotland, where where we’re already we’re very active and and built up inventory in anticipation of that, working our way through that inventory, continuing through 2024, where we also positioned towards increased activity levels in markets such as Hungary, Romania and also the upcoming markets, Portugal and Poland.

At the same time, we’re working with our supply chains. We’re working with our own operations to make our operations more efficient. I think that’s partly what we will see a result of in Q3 working into Q4. Specifically, the reduction from Q3 to Q4 was driven by somewhat lower raw materials, spare parts, inventory with fairly stable finished and work in process levels. So, okay.

Here are a couple more, but I think I’ll come back to that later. I think, Simon, we’ll have maybe some concluding remarks from you.

Simon Bolton, CEO, Inbivco: Yes. Definitely, Michael. So first of all, everyone, thank you very much again for tuning in and your time and interest in the business. Again, it’s been a another really good year for Avidco twenty twenty four. Very strong end.

Pleasure to present those results with Michael this morning. And certainly, as you see, there’s a really fantastic growth opportunity for us as a business going forward. Over the last few years, we’ve developed the right products, we’ve developed the right team, we have the right experience. And certainly, when these markets do go live and when those processes complete, then certainly, we are ready to deliver the products and really make these deposit schemes work well for the countries that implement them. So exciting times.

We’ll look forward to keeping you updated. Our next presentation is in May for Q1. So with that, from Michael and I, thank you very much indeed. Have a great day and we’ll keep in contact with you. Thank you again.

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