GraniteShares Gold Trust Price & Performance (BAR)

Thank you, Willem, and good morning, everybody. So let me start with the summary of the group's results for 'twenty four. So after a very difficult start of the year, we saw the situation actually improve throughout the second half, where we ended up almost flat compared to the year before. We saw quite some divisional and regional differences, where we saw very strong performance in The Americas and weaker and softer market conditions in EMEA and APAC. We started the year with a very strong order book around EUR $564,000,000. That was definitely with a significant growth in the entertainment business. Also a very healthy book to bill, larger than one. And we also stepped up our revenue from ecolabeled products to 68% from total revenue. For EBITDA margin, for EBITDA, we landed at 121,000,000, which is 12.8% from sales with a significant step up in the second half. So gross profit percentage was, of course, supported by the introduction of new products, also more software in the mix, but it was also offset with a weak sales in our meeting experience, ClickShare. Now in the second half, we also basically controlled OpEx, but in a way that we did not jeopardize, of course, our investments and our developments.

And we ended up with an EBITDA margin of 16.7% for the second half. Net income came in at EUR 63,000,000, and we generated a strong free cash flow at EUR 110,000,000. That was driven by improved working capital. Our CapEx expenditure was mainly going million and was mainly going in Cinema as a Service and our focused factories investments. And for net cash, we ended at a position of about million. When we look at the differences in the divisions and also in the regions, then we can say that our Healthcare division was the most stable and resilient throughout the year, where we saw year over year minus 4% sales. That was fueled by The Americas and new product introductions. In enterprise, we saw minus 16% year over year, mainly driven by the weak sales in clean share, stable sales in Control Rooms and entertainment minus 9%. Slow start of the year for Cinema, but that definitely covers in the second half with a stronger movie state. And overall weaker market conditions, especially in EMEA for immersive experience. So when you look at the regions, we did grow in The Americas across all divisions, 6% over the year.

And also here, the new product introductions did help and also the large deals that we closed in cinema in the second half of the year. In EMEA, we saw the strongest drop, minus 27%. Overall, actually, difficult market conditions in many of our business units, but especially in Blix share and immersive experience. And in APAC, a modest reduction of minus 8%. We did see a modest improvement in China, but that was then offsetted with other regions in APAC. Also to note here that we stopped actually our controlling business as part of our transformation last year in certain countries in APAC, and that was reflected in the numbers in APAC also for 2024. And now I hand it over to Jan for more details on the numbers. Thank you, Ann, and good morning to all of you also from my end. Looking into a little bit more of the figures, we are presenting first half, second half combined in the quarter full years. The first half indeed softened in particular with respect to the lower sales, which we picked up in the second semester as we got through the absorption, so to speak, effect of inventories at our customers.

And as for instance, the investment climate in cinema did pick up again as of the second quarter actually already, but further into landing orders and sales into the second half. So second semester, we laid down million of sales, which is minus 3% compared to the year before. And combined on a full year, that gets to million of sales, minus 10% year over year. Gross profit gained down to 40.7%, one percentage points lower than last year, which is primarily the impact of lower click share sales in the end, as well as within entertainment's lowest performance of Immersive Experience. There has been some delay on products which will be launched this year and which come with a better margin as relating to finished processing products. We did contain our OpEx valve over Schofs and Nestor's and that's now that our OpEx at minus 5%. So, yes, it would contain half of the decline, so to speak, offset in our top line. And then landing at an EBITDA of 12.8% in DASH, there is an Woody included NPD other operating income of NOK10 million, which has an impact, which is relating to Ensel and Lisbeth of building in U. S, which we concluded the building which we are not fully utilizing and in that sense looking for more flexibility going forward.

So that has an impact on the full year results of EUR 10,000,000 in EBITDA. Excluding this one, we get to a full year EBITDA of 11.8. Same figures that are in our usual presentation of the bridge EBITDA full year. So in that sense, yes, the more down of course is relating to lower sales and then one percentage points lower gross profit margin offset and in part with OpEx containment, so minus 5.4 lower OpEx offsetting indeed inflation. R and D we maintained and this is really because to really go full force on our product roadmap and product introductions of which we have many in the years and also are still more than two GECOM in this year. So that's nice. Sales and marketing included the positive impact from the Signonic companies or cinema sales company, which we integrated and which we have again 100% of share into that. And then also the positive impact of the Control Rooms strategy, which we revisited and the size of measures, which we took on costs actually, which were helpful. And then there is a good part, so to speak, on other income included in there the two bigger items or the higher results into our China joint ventures, which is a recurring thing.

And then non recurring is the gain million relating to the sale and inspect of our U. S. Of a U. S. Percent. So with that, yes, landing at 12.8% EBITDA in March. Going further down into the P and L up to our net income starting from EBITDA, which we explained. Depreciations are higher than last year as expected and has to do with the high repressations on our Cinema as a Service business. Restructuring came down, which is all including the off costs is 11,000,000, so actually in line with the year before. Then interest and taxes, interest or higher taxes or lower effective tax rate is the same 18% as in previous years, then landing at a net income of 63,000,000 or 0.7 earnings per share. Moving over to the free cash flow. So a strong free cash flow, which we're able to generate and with continued focus and work done on our working capital, we could also get the positive impact in our results of that one. So free cash flow ending at SEK110 million, up SEK72 million versus the year before. Our net operating cash flow landed at NOK161 million, including NOK60 million coming from lower working capital.

Our net working capital is now ending at 11.8% of sales, which is an improvement of 4.8 percentage points versus the year before. The average base sales outstanding 63% in line with the year before, improvement on average payables 61 further opportunity there to get the equation that DSO was able to do. So that's a further work at hand for this year. We worked on customer advances as well into that and goods have a considerable higher amount of that on as well helping on net working capital. And we've been able to drill down our inventories to NOK25 million. If we look to our inventory turns, then they are still at only at 2.1, which is stable year over year. So further opportunities ahead there to do better and continued better also in this. With furthers, with steady capital expenditures investments to the tune of NOK43 million rounded here, which is according to our strategy, continued investments in manufacturing in our factories into automation of our factories as well as in Cinema as a Service included for NOK15 million in NOK43. Then the net proceeds of the sell and leaseback impact on the free cash flow has an impact, a positive impact in recurring of NOK12 million.

And so with that landing at the net cash of around $260,000,000, up €18,000,000 per year, that's after dividends of 43,000,000, 20 5 million share buyback and then 20,000,000 relating to the buyouts of our minority shareholders in Simeone. When we look to the non financial KPIs, I'm actually glad to see that we made progress, and nice progress actually on the different ones, many more to read KPIs into our integrated report which we also published today. But taking out here three, so sales from ecolabeled products started to 68%. So when we look also to the introduction of new products, then we are already at 86 of new products or ecolabeled. So further stepping up towards our yearly step up towards our target which we have to get to 80% in 2027. We are on the path to get there. Employee engagement scores improved with one percentage points to 73. So that's also nice work done across actually different regions and divisions to keep it at that level, further working on continuous improvement also there to get to 75 within 2020. In total, we are at 3,135 FTE at year end, which is down versus year before. We saw the restructuring costs and the P and L. Here's a couple of main actions which are sent, which is the closing of the factory in China in Xunping as and then automate the automated actually in a factory in Wishi control rooms announcing the integration or three biggest items in Wishi.

Very happy with the customer Net Promoter Scores, which had an uptake of six points last year and NAND IT at 54. So also when we look into our more deep dive, the after sales service exposure to get there on our product quality and reliability of our products, yes, which we stand for, of course, very nice course. And with that, I give the words to Anne to give some colors on the yes, and I will check whether you are still Yes.

Okay. So let me give some more color on the different divisions, starting with Healthcare. As I mentioned already, very resilient robust business in 'twenty four, definitely driven by good performance in Americas and also new product introductions. So that resulted in an order uptake of 6.5% over last year, sales minus 4%. Also thanks to the product mix, more software, more new products, we saw a step up in gross profit that also reflected in the EBITDA with an increase of 2.8 percentage point on EBITDA margin. When we look at Diagnostic Imaging, full year growth, definitely a pickup in the second half with the new products that we introduced. Very strong growth and demand in The Americas with double digit sales growth there. A little bit softer conditions also here in EMEA and APAC. It's slower than the procedures, longer sales cycles and also, of course, softer macroeconomic conditions in EMEA and APAC. Now we have very successful launches of two new products in diagnostic imaging. One was this 8MP home reading. That's a full portfolio now. But also our flagship mammography medical screen as 32 megapixel, it's called One Look, had a very, very successful launch in the second half of the year.

Now we see towards the future that besides, of course, the new disruptive products and hardware that we introduce in the markets that more and more of our differentiation will come actually from new software features, more AI use cases and of course, also stepping up our performance in other verticals like digital pathology. Now when we look at surgical and modality, there we saw a growth returning in the fourth quarter. It took our customers throughout the first half to basically bring down their inventories. We are glad to see that we are at normal levels now and that also basically caused that we saw an uptick of orders in the fourth quarter and the second half in the fourth quarter, especially actually in The Americas and especially also on our NexSys network portfolio for operating rooms. Now that is, of course, also good for the portfolio because that has is a high margin product and that is good to have in product mix. That was offsetted with more competition, more cost driven competition in our modality displays, which we, of course, address by our global footprint and, of course, local production, local sourcing in China. That's our way to address actually the competitiveness, of our competitive position in modality.

When we go to enterprise, again, we saw 17% decline in orders, 16% in sales, mainly driven by weak ClickShare performance, stable business in Control Rooms. We also turned our Control Room business into a profitable business with a very healthy EBITDA margin, And that resulted for the division in a drop in EBITDA of 6%. Now when we look at meeting experience, we started '24 with high inventory in the channel. It took us longer than foreseen to build up that excess of inventory. It actually tripled to almost the whole year, but especially in the first three quarters of the year. And on top of that, we see in EMEA also competition, competition not only from Chinese competitors but also from the proprietary room systems. Now that said, we could maintain our market share in diagnostic space with our ClickShare solution being agnostic, being flexible, very secure and of course have an augmented user experience. And that was then reflected in growth actually for our ClickShare business in the second half in The Americas. Now for this year, we are developing our next platform on the ClickShare family portfolio. That is an Android based platform. It's a completely new architecture based on this mLab platform.

This is in very strong collaboration with Microsoft. And this allows us next to our BYOM ClickShare agnostic system also to bring room system on the market. And overall, this will increase actually our reach in the video conferencing market. And we plan to launch this product in the second half of this year. When we look at control rooms, then we basically saw growth in The Americas, a little bit slowdown in EMEA and EPAC, longer sales cycles there. Of course, our controlled software platform, the one that we launched already a year before, is definitely basically getting a lot of traction in the market. It is very secure, very scalable, very flexible. And those are actually the benefits that our customers start seeing in all our markets in control rooms. Today, that contributed for 30% of the total sales came from our new platform, and we're stepping that up to 40% in 2025. Besides our software platform, we also have very up to date hardware portfolio with our LED, LCD and RPC technologies and those are also were also part of the mix in 'twenty four. When we go to entertainment, so slow start of the year for cinema.

Overall, softer market conditions for immersive experience resulted in 6% decline in orders, about 9% decline in sales. And EBITDA was a slight improvement, 0.4 percentage points there. So Cinema, slow start of the year, again, limited movie slate, still a consequence of the strikes that we saw a year before. That movie slate improved drastically towards the second half, and that also basically made it to that our business rebounds in the second half of the year with large deals, especially in The Americas. We also had a launch of our HDR light steering projector for premium cinema theaters. So we basically launched a pilot program in The U. S. And in The U. K. Last year, which was also very successfully accepted by actually our exhibitors, our customers, but also by the audience. And of course, this year is the year where we also start ramping this product in production that we launched three very important new products in immersive experience in 'twenty four, I600 more towards the beginning of the year, that is our mid segment projector. And then towards the second half of the year, we had QDX, our high end projector and the S400 as our simulation projector.

There is one product in image processing, the ENCORE three, that was delayed towards this first half, where we actually see overall, we see actually an immersive experience, a good order book, including those new products. So when we look then at the outlook for 'twenty five, we do believe that we start the year in a better position than we start 'twenty four. The reason for that is that our customers basically did build down their inventory levels and then back to normal levels. We also can benefit from a full year effect of our new product introductions. We are seeing more and more software in our product mix, which helps us also for our margins. And of course, we opened our RUSSI factory last year on time within budget. And also there, we basically invest in automation, and that will also reflect in our gross profit margins to our 25%. Now with these things, and we and assuming that the geopolitical and macroeconomic conditions do not strongly deteriorate, we expect the top line growth for the full year with an increase in the EBITDA margin. Also, our Board of Directors will propose to the General Assembly to distribute a gross dividend of per share, per share, which is up versus last year's dividends.

And we want to say that we are and remain committed to exploring acquisition opportunities to strategically strengthen the group as well to optimize our capital allocation and delivering long term value to our shareholders. But backed by robust free cash flow generation and a strong balance sheet, the Board of Directors has decided to initiate a share buyback program and we're planning to purchase Barco shares for an amount up to 60,000,000 over the next twelve months. The Board of Directors will carefully assess and determine the optimal use of the repurchased shares at the later stage. And now I hand it back to Wil.

Thank you, Anne and Anne. We will now open up for questions. If you have a question, you can raise your virtual hand. I see some of you have already done that. Alternatively, you can also post a question in the chat, but just raising the hand is preferred. If you have a lot of questions, more than two, please, we will take two at a time and then you can queue again for more questions. So I'm going to start with the first one and that is, Matthias, I have you can now unmute yourself and then you can ask your question.

Yes.

Matthias Mannert from Kepler Cheuvreux.

Good morning. Good morning. Thanks, Sandler. Hope you can hear me.

Yes, we can.

Yes.

Yes. That's a good start. So thank you for allowing me to ask these questions. Maybe two from my end to start with. So you guide for sales growth and improvement in margins. Could you maybe elaborate a little bit on how you see that from a divisional perspective? More specifically, enterprise, what should we expect there? And then a second question I have was on the capital allocation. So you announced a million share buyback. I would say why million? And I note the comment of the Board of Directors that will decide at a later stage. Can you maybe elaborate on there presently any ongoing M and A discussion still ongoing? And is it actually the goal to effectively destroy the shares? My first two questions. Thank you.

So I'll start. So on growth actually, so indeed, going in actually with a call it a more bold statement or ultra, we could say, on growth year over year and without, so to say, precise figures. So we'll see as we get smarter and into the years actually on how we can find in those actually. Also the positive, there were some headwinds which we had last year with respect to higher inventories as customers with situation around the movie slate and cinema, which we don't have anymore. Then we have quite a lot of new product introductions over the course of last year launch, which are into effect as of the start of this year. So these are the main dynamics actually to the positive to back actually our sales growth. Now we see that actually without giving precise, I would say, guidance of forward on the divisional out groups in that respect, so talking on a group level actually. But this is what I just named, yes, over the three divisions, so to speak. So that's a more, I would then say, general answer. As to whether it's actually, yes, from two point zero or who you can call it, might then have an impact on some hesitance on investments, etcetera.

That's a little too early to tell. We are fairly cautious there and closely monitoring as to what we can do. With our focus factories, we do have the ability to deliver out of Europe or out of China. Of course, we don't know what in the end it will be. So preparing that one. So in that sense, that's why we indicated on the do not further deteriorate or into our outlook statements. So that's a little bit in general where we go forth. I have sympathy that you would like to have it more precise, I would say. But we also learned that it's better to first have proof points and then fine tune as we move. Yes. Okay.

For capital allocation, so again, we generated a very strong free cash flow position. So that's why the Supervisory Board and the Board of Directors actually also decided to increase the dividends and also basically start a share buyback program. So that is definitely share price is low at this moment. So it's a good moment to invest. So in that sense, now what are the other ways that we will allocate our capital? Of course, there is our regular business, our cinema as a service, our capital investments in the manufacturing sites. Besides that, we continue to look at M and A. The two particular targets that we had last year did not work out, but that does not mean that we continue to screen the landscape and see where there are good fits for Barco that will strengthen actually the group. And I think at this moment, the Board of Directors wanted to keep the option open, how to allocate actually the capital that comes to the share buyback.

As to the amount, so that's calculated as with the dividends, which will be an effect of about NOK 45,000,000 and then on top the NOK 60,000,000 that, that combines it's about million pricings, yes, of million on the cash.

Okay. Thank you very much. Thank you very much for that question. Next question is for Chris Kippers from Degroof Petercam. You can unmute yourself before asking a question.

Indeed. Thank you, Willem. Can you hear me?

Yes, we can.

Perfect. Thank you. Good morning. Two questions also from my side. First one, very strong, I think, cost control. If you look at all lines, R and D, sales and marketing, admin, so it's still stable. The absolute numbers were even down. Given that we still see some certainly, of course, here in Belgium, but also in some other countries, some inflationary impact, when your sales go up, to what extent should we see an inflationary impact? Or are these levels just manageable going forward? Or are there any still some things you can improve right there? Second question, free cash flow, quite strong in 'twenty four, of course, but it was this was partially driven by, you could say, some one offs to a certain extent. So the build down of inventories, million, you've had the sale of the buildings. Also CapEx seem to have dropped somewhat. So going forward, what should we anticipate here? Or what is the recurring level of free cash flow given the guidance you've given us? Thank you.

You want to take the first one?

Yes. So on cost control, this is something that we always do diligently, yes? And we also need to basically compensate for inflation, yes? Which means with top line growth. We aim, of course, the mission is to grow. If not, cost control is definitely one of the measures that we take. We do that in a very focused way so that we don't jeopardize actually our future revenue generators and that we basically look in where else we can optimize our costs. So this is actually practice, good practice that we have throughout the years and we will apply that also for '25. But again, the main goal here is, of course, to go for full year growth.

But indeed as to our models, if I can say so, order '25, we also looking in how we can offset the impact of inflation with efficiencies. As to the free cash flow, so the a couple of things. So indeed, working capital nicely worked down, including so in total, million, including million on inventories. There were further opportunities in there. Of course, we are not to the tune directly to expect nominal as the down which we did last year, so to speak. But yes, getting now at 11.8% of our working capital as a percentage of sales, we do want to have some further improvements on that one and working on those in 2025. And the main thing around this is actually further improving our inventory churn. Yes.

And there we constantly focus on it, but also we still had quite some stock from post COVID like end of life components that we had basically pull in. But gradually as we go, of course, we start consuming those. So this is definitely also something that will happen. So favorable improvement there.

The 12,000,000 upside on the sale and its back end details and on the recurring. With respect to the capital expenditures included million towards this year, million actually, we keep it at that level. So that's the assumption to include in there In that sense that cinema as a service discontinue, refurbish, invest into automation, into factories actually, factory revamp included as well here in Korsvik. So in that sense, that's to take into account. With respect to the other items, it's more stable like effective tax rate and those things. So in that sense, yes, we're looking for a healthy free cash flow again this year, some areas where it's certainly can further improve, starting of course with another operational result or EBITDA, some further improvements on working capital. And with that, yes, keeping it also strong. But yes, likewise, as you mentioned, Chris, some extras have been realized in 2020.

And just coming back on the working capital percentage of sales, given your mix and product mix and also the fact that you're distributing differently, sometimes direct to consumer with the bar, for example, or things like that. To what extent does this hinder your further decline? Or would you say that 10% to 11% of sales is an achievable number in a normal recurring way of working?

Towards 11%, we want to move. That's actually the concrete target that spelled out. There are indeed a couple of things, which is product portfolio also, Martin, coming from a longest underway on the sea, so to speak. That has also an impact in there. New product launches and the startup of those also has some impacts. But anyhow, these are things to be managed. So in that sense, yes, further improvement, but not to the tune of what we did nominal wise in 2024.

Okay. Thank you.

Thank you, Chris, for those questions. Next in line is Stefano Tofano from ABN AMRO. Stefano, you can unmute yourself.

Yes, good morning. I hope you can hear me.

We do.

Good morning. Good morning.

Good morning. I have seven questions, but I will just ask a few. Just for my understanding, so the full year adjusted EBITDA margin 12.8%, it included one percentage points impact of the Schon Eastpak facility. The guidance, is that over this 12.8%, so including this impact? So that's the first question.

Yes. The answer is yes.

Okay. Thank you. The second question is, again, on the gross margin improvement. So I mean, obviously, I imagine there is continuous gains to be achieved on further gross margins as you continue to utilize your footprint and also utilization rates of your facilities go up. But can you be a little bit more specific, if possible, on any potential improvements over this year? And then my last question is, if I may, just a very general one. You talked a lot about more software within the mix. Can you quantify that please a little bit more? What kind of steps are we seeing from, let's say, 24% to 25%?

I'll take the software. You want to take the And go with the gross profit margin. So gross profit margin, further improvements over there. With the mix new products, also more softwares gradually coming, global footprint, these are actually the three main ones where there is where we have seen continued improvements and of yielding into results actually what we've done. That we see across actually different businesses in 24s already, There was then one more down and one percentage point which we lost compared to the year before, which has to do with lower sales and ship share, which primarily was impacted by inventory resets at our channels. And then second, a negative product mix and immersive experience where they landed on the orders with respect to the image processing products, but the shipments and the launch is only coming as of this year. So these actually are the main levers that to quantify as such, we do want to get back to the percentage which we had in the previous year, more than 23%. So at least get that one percentage points back. And that's actually what we were working at. And regarding software, so I would say in 2024, probably one quarter, 25% of our sales is software.

What we consider software today is, of course, all our software platforms like ClickShare, like Control, like Nexus in operating rooms. And for those, you've seen the numbers, we're already more than 30% actually of the sales of that business units is then related to software. Now towards the future, we see more coming in. So we also see, first of all, more software features. So you increase actually and you differentiate with more software features on those platforms. But we see ourselves also stepping more and more into software applications and AI use cases, which is, of course, developments that we're working on right now that will over time also get us into more recurring revenue. And that is something that we're definitely focused on and will increase actually also our software share in the coming years. But overall, it's definitely an area where we focus on. And of course, it's good for the mix and for our portfolio mix.

Thank you. Yes, one business where we have decided we have chosen towards indeed more softwares and control rooms then. And so in that sense, this year or in 2014, we're at about more than 30% of software sales and total equation. And then for the staffing, we have to adapt to the different part of this year. That was control, yes. So one example.

Perfect. Thank you.

Thank you, Mr. Carlo. Next in line is Giusepp from KBC Securities.

Yes. Thank you. First of all, congratulations with a nice set of second half results. And how many months were the successful launches in healthcare of the two products that you mentioned? So the HMP and the One Look, how many months were they included in the second half? And are they responsible for the nice half year on half year pickup of the EBITDA margin in Healthcare? And the second question is on click share. You mentioned that you're not only seeing competition from Chinese players, but also from proprietary room players. Can you elaborate a little bit more on that? And do you see that only in Asia? And do you expect that also to come in The U. S. And EMEA? And how do you react on these Chinese players who are more focused on price? What is your, let's say, what's your plan going forward?

Yes. Okay. So for the new products in Diagnostic Imaging, so the eight MP, so the home reading, we almost had the full year in 2024.

Second quarter.

Second quarter. No, no, yes, April, okay, second quarter. The one look was October 1. So that was a very successful launch. We actually sold about 1,000 or a little bit more than 1,000 actually for the last month of the year. So that definitely helped us with the numbers that you see in Healthcare. But overall, I think we saw quite robust and resilient markets overall. Also the inventory build downs at the customer side, which also created nice orders on Lexus for surgical. But yes, of course, the new products in diagnostics definitely contributed to the good results in health care. Regarding click share and competition, yes, we mentioned already Chinese competition. That is mainly in India. So we don't see Chinese competition in The U. S. How do we fight that? Well, of course, without patents, our intellectual property portfolio, this is something that we're launching actions actually against these companies in Europe. Sorry, sorry. So that's what may the competition that we see from room systems is in general. So the room system market is picking up. Sorry, I lost my voice. It's picking up. We'll also do so in 'twenty five. Our answer to that is our new platform where besides the ClickShare wireless offering, we will also offer now a room system based on an Android platform.

As of the mid of the year, which we will launch, I'll take it.

Excuse me. Together, actually, Microsoft. Yes.

Okay. Yes. Okay. I hope we could catch that one. Okay. Good.

Thank you, Guy, for those questions. Next in line is Marc Hesselink from ING.

Yes. Thank you. First question also coming back on the click share. Given yes, quite some moving parts with the inventory levels at your clients, so a very big negative impact in the first quarter. And I think a very difficult comparable base now in the fourth quarter. But if you try to strip that out and look a little bit at the underlying trends, how is that going over the four quarters of the year? And also, if you compare it to your maybe, let's say, the pre COVID level, how far are you off from what's maybe what you could approach?

Yes. So I think just to say the inventory level, so yes, we started the year with EUR 20,000,000 extra in the channels. That we completely built off towards the end of the year. So we start this year with very normal inventory levels back to the beginning of twenty twenty two. So we don't have this challenge anymore of extra inventory in the channels. When you deduct this extra inventory, then I would say that we actually grew pretty much with the markets. So and the market basically starts to pick up as of third, fourth quarter. That's actually, I think, then we saw pretty normal trends compared to how the market was doing.

This being said, the sellout in the second semester was not yet at the level of the year before. I think that's also your question mark. So in that sense, we yes, it was in line with the mark so to speak and it certainly was better in the second semester than the first semester not yet at the levels that you had before. So in that sense, yes, that's that we will see how that's started.

Yes. And pre COVID, well, that was yes, that was higher. We're talking 2019 at the time. At that time, the competition was also less. There was less competition from room systems, definitely from Chinese players. So the market dynamics have changed actually quite a lot there.

And there from a regional perspective, yes, we saw that in The Americas, we do see growth again in our figures and likewise also in the sellout. Europe is the more challenging market macroeconomics wise and yes, in tough markets, more competition as such. Yes. But again, the way that we want to differentiate is also with our products. Having a more secure, more flexible, more agnostic product is definitely something that we want to differentiate ourselves and not go into a downright price fight in the especially in the European market.

Okay, thanks. Maybe a link to that because I think indeed you just say the big change is the proprietary rooms. If you look at that from a long term perspective, how does that change your market opportunity? Is that something that means that the structural market opportunity for ClickShare is less because we now have these proprietary rooms? Or how are you looking at that?

Well, it definitely increases our addressable market because now we basically can address all rooms, so that helps. I think working with Microsoft, which is a very dominant UCNC player in this video conferencing market is also a good thing, basically being now also promoted by Microsoft. We're also the first adopter of Microsoft's new Android platform, which will also basically give us some extra momentum actually when we launch this product. So I think we'll get into a bigger addressable market. For us, we started last year with introducing this switch. Remember, that was a standalone device that allowed in one room to switch between an MTR system and a click share system. And now what we're doing is we're building a full click MTR system. And it will also allow, and that is then a whole portfolio of products that we bring out, to switch also towards our click share agnostic video conferencing for when the need is there, so when visitors are in the room or when you have a Zoom conference call. So this is actually we're adding then also the differentiator that we have from click share, agnostic click share into that room system. So that's the way that I think the market is evolving and being first with this new platform or one of the first ones with this new platform is going to give us I think a first mover advantage.

Okay, clear. My second question is on, I mean, a bit of speculation probably for your side, but tariffs probably might happen quite a lot or it could happen quite a lot. Are you preparing and how will it impact you?

Yes, we're definitely monitoring it. So we definitely we have a task force, a work group here that monitors this very carefully. I think our first responses here are that we have, of course, the flexibility of the manufacturing footprint that we have as well our manufacturing in China, but also in Belgium and Italy. Now of can come anywhere, so they can also they might also come in Europe, but that's one flexibility that we have. The other one is that most of our products are not being produced in The Americas. So also our competitors do not produce projectors or medical monitor screens in The U. S. But then still to be seen where they produce and if these countries get tariffs compared to the countries where we produce. Yes. What else do we have under control? Yes, we're continuously working, of course, on our cost efficiency on these products. So that's another thing to bring the costs down. And yes, then price increases is definitely if we have the way and if we see this as possible in our competitive landscape, that's also one of the things that we keep in mind. But we yes, we're monitoring that very, very carefully.

And could it be like extreme scenarios that you move also production to The U. S? Is that something?

Well, at this moment, there are no concrete plans to do that. Let's see what that means, if it will ever get that far.

We're back at Matthias Mannhuis from Kepler Cheuvreux for some more questions. Matthias?

Yes. Hi. Thanks. A couple of follow ups. Just one clarification. So the guidance, I just wanted to be sure that I understand it pretty good. So you are guiding for a margin increase from the 12 spot 8% you've reported including the one off of the sale and leaseback?

Correct. Yes.

Okay. Then a second question is actually on the transition to laser in cinema. Could you maybe give us a feeling on where do we sit in the cycle? How much is already done? And how much is there still to be done?

Yes. I think at this moment, we're about a 30% installed base on laser worldwide. Barco has quite big market share there, over 65% for new installed capture rate, even close to 70% in certain countries. But overall, the installed base, around 30% on laser. So there is still a big wave to come. Maybe also here to mention is that you know that Sony stepped out of the projector business in cinema. There's still Sony systems installed and they go end of life or end of contract, actually service contract in 'twenty six. So that wave is still also one, yes, to focus on, of course.

Okay. Thank you.

Thank you, Matias. Chris, you also had more questions. Please go ahead, Chris Kipperstrom. Yes.

A follow-up indeed from my side. Just to be sure, if you look at the non recurring costs or the restructuring costs actually, so not the 11,000,000 leasing in The U. S, so the sale of the building, but just the restructuring costs you've put in the P and L. In the second consecutive year, it amounts to roughly million. What should we expect from this level going forward? Because it also influences, of course, your adjusted EBITDA margin. So just to make sure, is it again around this level? Or are we almost done now with restructuring? Thank you.

We are almost, yes. We are done in that sense, never say never. You see how things are evolving. Don't make sure. But not certainly not still in tune on the months posted in the past two years.

Yes. And then second question, just a detail perhaps on click share. We see that click share bar was about 10% of top line. To what extent is that filling the pipeline or with the inventory decline base? Or to what extent is this also sales to consumers because it's a direct to consumer model? So I presume it's quite direct sales.

So we sold more than almost 10,000 video bars actually in since launch. So we basically sell that to our regular channels, but also we introduced the open channel approach, which is more than a wider set of resellers that do not get the same conditions from us. So in that sense, yes, it's opened up to a larger reseller space. Yes.

But if you talk about normalizing factory levels and it's actually in all of the different products in each channel.

No, it's the same. And of course, this is also geared towards small and mid sized meeting rooms. So that's of course also for smaller companies as Hermes. And that's also why we actually went with this open channel approach to reach them actually.

Okay. Thank you.

Thank you, Chris. Stefano from ABN Hamburg, you also had some follow-up questions.

Yes. So two follow-up questions. I don't know if you can specify how much the impact of SaaS is on the full year EBIT results if there wouldn't have been any SaaS? That's the first question. And the second question is, can you give us the EBITDA margins for Control Room? Okay. On the first one, I can be precise. On the second one, we do not disclose. So on cinema, if I tried.

Yes, of course.

No problem. So on the first one, if you open CapEx sales instead of cinema as a service, then our sales would have been million higher in 2024. But the good thing about regarding revenues, of course, is that you start the year, it's not from zero, but from a nice amount and which is actually in ceramide, particularly, 30,000,000. For control rooms, do we do It is positive, healthy positive? Yes. It's healthy positive and we're actually very happy seeing those results in control rooms because the big transformation that we did in this business is actually now turning out to be successful. And it's with consistent feedback actually also from our customer base on the software products that we have been launching and that we're bringing to the market now. So it's definitely a very positive way to start this year in our Control Rental business.

Yes. And also help with the decisive cost measures, which we also took. But our two jobs, the organization is stable moving forward, so we're going forward. So in that sense, a nice positive and structural improvement for a steady year further.

All right.

Thank you, thank you.

Thank you, Stefano. We also have a question from Trion Reit, Berenberg. Trion, you may unmute yourself and ask your question.

Thanks, Guillaume. Thanks, guys. Hope you can hear me fine.

Good morning.

Hi. Just one question just on China. I think one of the reasons that '24 was weak was we expected a rebound in China, it didn't come. Could you just comment on what you're seeing there? Is there any sign of improvement?

Yes. So China, we had a very modest growth actually in 2024. It was mainly driven by entertainment and actually mainly by cinema. That's what we have been mentioning before. Box office is starting to improve. Movie slate is starting to improve there and the whole laser pickup wave is starting again. I think in healthcare, we have through the anti corruption rules. So this is now the new way of life. So we have to basically deal with it and also in the channels figure out what that means. But there, I think we see strong leads, especially in our surgical and mobility business. And also for the Diagnostic Imaging, we're working actually on, yes, setting up the channels now in this new era after the anti bribery measures that were taken there. So there, I think we're to the worst and we're setting up for growth in health care. Maybe one other one on immersive experience. There also the market is changing in China, so less government sponsoring, so less what we call B2GIA to government, more B2B, which also takes from our side and also from our partners and channels that we now need to deal with that new reality set up also new partnerships, which are more in this B2B space.

And that work is going on. We actually start seeing some nice inputs there, but it's also working our way through. We hit the bottom, that's for sure. 53, yes. It will only go uphill at what pace is still to be seen. Yes.

Okay. Thank you.

Okay. I see no more raised hands. If you have One more to do.

One more for Trion, but no, it's just Okay. If anybody of you has a last question, now is the time. No, nothing from me. Thanks.

No? Okay. Then we believe we can close this earnings call. The recording of the call will be available by noon today on our investor portal. And today, we also published our integrated annual report. So I invite you all to go see and find it on our investor portal. You will find a lot of background and stories from the people at Barco and from all divisions and markets. Really worth a look. And before we close, I would also like to draw your attention to our upcoming Capital Markets Day, which we will organize on October twenty third of this year. And we will host our analysts and institutional investors for a strategy update, a lot of product demonstrations and also the opportunity to meet management at our headquarters in Kortrijk, Belgium. So for now, thank you for your attention and have a very good rest of your day. Thank you very much.