Matias went through the impacts of the IT reforms in the webcast. I will directly quote a couple of points from the webcast transcript here.
Matias: "Now, this is quite a significant piece of work for us, and it will have an impact on our deliveries during Quarter Two. It will include such things as actually ramping down production for a temporary period of time in Muurame, transforming the systems from the old to new, and then ramping the production up. And because of this, we estimate that there will be roughly €3 to €5 million worth of shipments shifting from Q2 to Q3. And this will, of course, move also the related gross margin from quarter two to quarter three. And as we will be working long hours, there will not be savings in, for example, employee costs, as direct labor will still be present and involved in these transitions and ramp-ups.
So we also expect that there’s going to be some impact on the OpEx level as well during the quarter.
Now. However, this is very well planned. The customers have been informed in advance. We have confidence that we will not be losing any sales. So while this would have a negative impact on our quarter two, it should have a clear positive impact on our quarter three.
And in addition to having the sales back in the quarter three, we believe that this transition to the more modern, efficient, and scalable system will start to pay back rather soon."
Second Q&A question: "Was there anything in Q1 revenue that would not occur again later in the year? Or was everything just driven by robust normal demand? "
Matias Järnefelt: "There’s nothing particular to mention.
I think one question might be that since we informed the customers about the longer lead times during Q2, whether that has turned into what I would call advanced buying.
But as we’ve been analyzing that, our assessment is that that didn’t have any significant impact on our Q1 results. The impact will be seen in quarter two and quarter three, and hopefully we will be able to catch up fully by the end of quarter three. Of course, that remains to be seen, but we feel fairly confident about that."
So, in short: They have analyzed the situation and concluded that there was no significant impact on Q1. The effects of the IT reform will be seen in Q2 and Q3. An estimated €3–5 million worth of deliveries will shift from Q2 to Q3. This will also be reflected in the Q2 results, as production must be temporarily ramped down, while the cost side remains fixed.