The following is excerpted from the question-and-answer section of the transcript.
(Questions from industry analysts are provided in full, but answers are omitted - download the transcript to see the full question-and-answer session)
Question: Sylvia Pavlova Barker - JPMorgan Chase & Co, Research Division - Analyst
: Maybe just starting with the costs related to the new transformation program, the SEK 1.4 billion. Can you split that out between write-downs and
then cash cost? And how do you see the cash costs splitting between different buckets as well? Then on the aviation impact. So am I right in thinking
that that's about a 3% to 4% negative, the group organic at the moment? You have been renegotiating aviation contracts, so interested whether
you have actually now reached an agreement in some places where you might be exiting contracts. Can you give us any guidance in terms of top
line impact from contracts which will not be continuing in '21? And then finally, could you comment on the organic development during the
quarter? So you hopefully gave us September at plus 1.5% organic. Could you comment on December and into January as well?
Question: Sylvia Pavlova Barker - JPMorgan Chase & Co, Research Division - Analyst
: Yes. It's the remaining SEK 1.2 billion. I guess, how much of that might be redundancies versus implementation costs?
Question: Sylvia Pavlova Barker - JPMorgan Chase & Co, Research Division - Analyst
: Okay. So if we think about what you're actually doing, it's mainly around the systems rather than reorganizing in any way how Europe or Ibero-America
run? Obviously, historically, you've said that Europe is very fragmented compared to, let's say, the U.S. You have a lot of duplication of costs. So
just trying to understand, I guess, where the savings will be coming from mainly.
Question: Sylvia Pavlova Barker - JPMorgan Chase & Co, Research Division - Analyst
: Yes. No, that's very helpful color. If I just -- final comment. In terms of how you think about when a cost item is one-off versus just part of normal
kind of activities or investment, just what is the thinking around that SEK 1.2 billion being actually split out as one-off?
Question: Erik Paulsson - Nordea Markets, Research Division - Analyst
: So 2 questions from my side. The first one is on those 11 countries that you are exiting. What is the margin implication for the business regarding
this? And the second question is regarding the other segment in your business areas. It was minus SEK 178 million in the quarter here, which is
slightly down or up depending on how you see it, compared to the going rate for the recent quarters? And what's behind this increase here?
Question: Katherine Somerville - UBS Investment Bank, Research Division - Analyst
: Three for me, please. So firstly, now that we're in a more business-as-usual environment, are you seeing signs that clients are increasing their uptake
of digital services? And what do you see in terms of the pipeline here? And the second question, given that Biden has now been elected, what's
your view on wage inflation, given the backdrop of the $15 floor in the U.S.? And then finally, Bart, I think you alluded to this earlier, but what new
services do you think you can offer to clients in the aftermath of COVID?
Question: Andrew Charles Grobler - CrTdit Suisse AG, Research Division - Analyst
: Just two from me, if I may. Firstly, on the transformation programs, you've got some quite hefty targets in terms of margin improvement. When
you think about the bridge from where you are to where you're going to hopefully be in a few years, can you split that out in terms of how much
is cost, how much is efficiency and how much is mix on that part? And then, secondly, and just a quick one, in terms of some of the cash payments
that are going to reverse in 2021 and 2022, can you just split those out between the 2 years, if possible?
Question: Andrew Charles Grobler - CrTdit Suisse AG, Research Division - Analyst
: Sorry. Can I just follow-up on that? You mentioned the mix benefits over the next few years. Just when we look back over the last 5 or 6 years, you
had that quite positive mix shift towards electronic security and the margin has stayed basically flat through that period. What makes you think
that the next few years are going to be markedly different from that as you go through this process?
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