Siemens Healthineers AG

XETRA:SHL

Earnings Call Transcript 2020-Q4

[Operator]

Good morning, ladies and gentlemen, and welcome to Siemens Healthineers Q4 Fiscal '20 Conference Call. As a reminder, this conference is being recorded. Before we begin, I would like to draw your attention to the safe harbor statement on Page 2 of the Siemens Healthineers presentation. This conference call may include forward-looking statements. These statements are based on the company's current expectations and certain assumptions are -- and, therefore, subject to certain risks and uncertainties. At this time, I would like to turn the call over to your host today, Mr. Marc Koebernick, Head of Investor Relations. Please go ahead, sir.

[Marc Koebernick, Head of Investor Relations]

Thank you, Nora. Good morning, ladies and gentlemen. Welcome to our Q4 conference call. The quarterly statement and Q4 presentation were released early this morning, and you can find all the documents on our IR website. I'm sitting together with Bernd Montag and Jochen Schmitz, who will be taking you through our Q4 results and be giving you an update on further developments in our company. Following that, there will be a chance for you to ask your questions to Bernd and Jochen. And although these days, a lot of habits are changing week by week, you can say some things never change. So may I just humbly remind you of the old 2-question rule in the Q&A. Now may I pass the word on to our CEO, Mr. Bernd Montag.

[Bernhard Montag, President, CEO & Chairman of Management Board]

Thank you, Marc. Good morning, everybody, and welcome to our Q4 earnings call. Thanks for joining us early on a Monday morning. And this may be one of the few things -- few good things about this pandemic, you probably did not have to rush to the office on a dark November Monday morning but instead can listen to Jochen and myself from your, hopefully, cozy home office. We are indeed in the office today, and we are together in one room without masks, and this is possible, thanks to our point-of-care COVID-19 Antigen Test. Thankfully, we all tested negative this morning. I would like to start off with looking back to fiscal year 2020 and highlighting what we have achieved. The coronavirus has changed the way we live and work in ways we could never have imagined before. In these unprecedented times, our team successfully mastered the challenges of the pandemic: securing supply chains to be able to manufacture and deliver our products worldwide, providing outstanding service to our customers and rapidly developing new diagnostic tests to address the needs to fight the pandemic. We achieved our fiscal year 2020 guidance, which we updated and reinstated with our Q3 results. Comparable revenue growth was in line with our guidance of broadly flat revenue growth. Earnings per share are EUR 1.59 per share, which is well within our guided range. And evidence of our team's excellent performance and the strength of our products is the book-to-bill ratio. For the full fiscal year, it was greater than 1. I believe this is a really impressive number in light of the impact, which the pandemic has had on business activity. An important foundation of this strong book-to-bill number were the numerous long-term Value Partnerships, which we signed in the course of 2020 and especially in Q4 in the United States. The order intake for our Value Partnerships jumped to a new level of EUR 1 billion in fiscal year 2020. This is a clear testimony to one of our upgrading priorities, which is driving share gains with leading providers and this even under very challenging conditions. And I'm very proud of the team, especially in the United States. Another record was our free cash flow pretax, which came in with EUR 1.9 billion, the highest free cash flow pretax since the IPO. Furthermore, we were able to constantly drive on our innovations, and we launched new product innovations in all our segments at our virtual event, Shape 21. And finally, we announced the acquisition of Varian, which was approved by Varian's shareholders at the Special Meeting of Stockholders on October 15. Once the acquisition is closed, we will, together with Varian, bring cancer care to the next level and become the holistic partner for the entire customer spectrum. In phases like the one the world is going through at the moment, resilience is key to emerge even stronger when the crisis is over. And in order to keep the engine running, it is great to be able to rely on stable performance elements. Let me take you through these on the following chart. Let me start on the upper left. Our geographical diversification has proven to be an important stabilizing factor over the years, and in particular, in this year of the crisis. You may have heard me say one of my favorite quotes, "Medtech is global and health care is local." What do I mean with that? We sell our portfolio worldwide into more than 160 different health care systems. So if, for example, one country faces challenges for whatever reason and the revenue growth is flat or even declining, other countries in the regional mix very often counterbalance this effect with higher demand. This was also the case in fiscal year 2020 during the pandemic. Americas declined, whereas Europe and China grew mid-single digit. Especially Europe has been very positive for us as it had been a region where the growth dynamic in the past years was rather muted. Now let me continue with the pillar next to the regional diversification. As already mentioned, the order intake of long-term Value Partnerships increased very significantly to roughly EUR 1 billion in fiscal year 2020. This proves that we are ideally positioned as the partner of choice for the consolidators in the health care sector. With their long-term nature, Value Partnerships create a high revenue visibility over multiple years. The third pillar is our service business, which, despite the pandemic, was able to show steady growth in every single quarter of fiscal year 2020, this enabled by our real-time 24/7 remote system monitoring operations capabilities driven by digitalization. For example, our Smart Remote Services experts can use advanced troubleshooting tools to remotely restore operations, and our LifeNet online portal enables 24/7 performance and maintenance management of critical equipment. The basis for this equipment service growth lays in our ongoing strategic priority to move service from on-site to online our installed base and in the multiyear service contracts, which allow for a high-visibility revenue stream here as well. With our reagent revenue, we have a further resilient revenue stream. Looking at our 2020 performance in Diagnostics, this may seem a bit counterintuitive at first. But with the COVID-19 crisis is -- but the COVID-19 crisis is not a classic economic crisis. The impact was massive on testing for routine care activity, which normally is an extremely stable business. The stabilizing factor is the contract duration of the installed systems, which usually lies between 5 and 7 years. During this time, all tests on the installed system have to be done with our reagents, similar to the razor-razorblade model. This hence leads to a high visibility of future revenues. Overall, the reagent sales account for roughly 90% of our Diagnostics revenue. In the pandemic, we have shown a fast adaptation to the new market needs. We were able to rapidly develop and launch high-quality tests like our PCR or serology antibody test to support the fight against the pandemic. Those 4 pillars, regional mix, Value Partnerships, service and reagents, are the foundation of our resilient revenue generation. And now I would like to hand over to Jochen, who will talk about our Q4 numbers and the outlook for the current fiscal year.

[Jochen Schmitz, CFO & Member of Management Board]

Yes. Thanks, Bernd, and good morning also from my side. In Q4, we had a record quarter for order intake, the largest order intake in Q4 we ever saw in the anyway strong year-end quarters. Overall, we saw a clear sequential improvement in Q4 versus Q3 as expected. Now let us look at the most important developments in our Q4. We posted the highest equipment book-to-bill number of the year this quarter with 1.15. After 2 quarters with book-to-bill below 1, this is a clear precursor for a normalization at our customers as we had anticipated, although we are carefully monitoring this development in the light of rising new COVID-19 cases. The Q4 book-to-bill brought us to a number of above 1 also for the full fiscal year, 1.06 to be exact, a great achievement, as Bernd has already highlighted in his intro. In other words, we leave the year of the pandemic with larger equipment order book compared to how we entered it. Let's go back to what drove the book-to-bill number in Q4. Equipment order growth for Imaging turned positive in Q4 on the back of the record large deals from signed Value Partnerships. Advanced Therapies showed a clear improvement in equipment order intake versus Q3, but it is, in Q4, still in negative territory in the higher single digits. Comparable revenues in Q4 were moderately down year-over-year, but a clear sequential improvement Q4 over Q3. Please also bear in mind that we had a very strong Q4 last year with 8% comparable growth. Imaging revenues recovered in Q4 from Q3 to an only slightly decline of minus 1.7% year-over-year, whereas Advanced Therapies was down minus 6.4% versus prior year quarter. Service business continued growing also in Q4 and remains an overall stabilizing factor. Diagnostic growth recovered as well from Q3 with minus 1% revenue decline in Q4 only. However, the margin continues to be under pressure from COVID-19 effects. The margin for the group came in 280 basis points lower year-over-year at 16.1%. Adjusted basic earnings per share declined 11% year-over-year to EUR 0.48. Free cash flow was up 12% year-over-year, showing a strong year-end finish for an excellent cash performance throughout the fiscal year 2020. We will propose a dividend of EUR 0.80 per share for fiscal year '20. This equals a payout ratio of around 60% of our reported net income. By going to the upper end of our payout ratio of 50% to 60%, we are able to keep the dividend per share stable versus last year's dividend. This is another proof of the resilience of our business to our shareholders, both in generating profit as well as cash in unprecedented times. Now let us have a look at the financial performance of the group in Q4. Q4 was again the strongest revenue quarter, a pattern we usually see with the year-end quarter. The fact that we kept our normal revenue distribution as in any given fiscal year despite the pandemic underlines also the resilience of our business. The revenue growth in the region shows a very mixed bag. EMEA saw strong growth with 8% year-over-year. Americas recovered from minus 10% in Q3 to a minus 6% decline in Q4. This recovery was also against tough comps of 10%-plus growth in the prior year quarter. Asia declined by minus 8% year-over-year, also against very tough comps of plus 12% growth in the last quarter. In Asia, we saw a mixed picture depending on the geographies. China was flattish. India grew while mature economies like Japan declined. Now let us have a look at the adjusted earnings per share. Adjusted earnings per share declined year-over-year by 11%, driven by declined revenue and a mixed picture in margins. Let me point out our -- that we saw substantial foreign exchange headwind in the top line this quarter of 5 percentage points. So nominal revenue declined by over 6%. By the way, this was passed through to the EBIT line in absolute terms yet partly compensated by hedging. In margins, we saw a mixed picture this quarter. Imaging improved margin year-over-year while, as expected, the Diagnostics margins continues to be under pressure. When looking at the nonoperational items this quarter, we again saw year-over-year headwinds from Siemens AG share plans this quarter, which we see across the segments. On the central line, we had a positive one-off in the prior year quarter in the double-digit millions, which obviously burdened the year-over-year development. These 2 items were roughly compensated by a lower tax rate this quarter of 21%. The very low tax rate in Q4 was driven by positive discrete items, in particular, from international tax procedures with a one-off character. Our financial expenses net have been slightly up year-over-year from a low level. The low level was achieved by our debt restructuring last year. Now let us have a look at the performance in the segments, starting with Imaging. Imaging revenue only moderately declined in Q4 with strong growth both in the Computed Tomography as well in the Molecular Imaging business. Please be reminded that we had super tough comps as Imaging grew double digit last year. Service continues to be a stabilizing element and grew nicely in Imaging. On the profitability side, we saw 22.4% adjusted EBIT margin in Q4. This was a record Q4 margin for Imaging and excellent finish in an already very challenging year. Headwinds on the margin from Siemens AG share plans were compensated by tailwinds from foreign exchange of 80 basis points. Diagnostics comparable revenue declined only slightly by minus 1%. Although reagent volumes are recovering, especially in testing for routine care, volume is still missing to get the Diagnostic P&L back to normal. At the same time, the tailwind from COVID-19 testing was limited so far. The missing reagent volume translates into ongoing pressure on the margin, primarily driven by effects from COVID-19 from the Atellica ramp-up and from foreign exchange headwind. We will discuss this in more detail on the next slide. Advanced Therapies. Revenue declined in Q4 by minus 6.4%. This decline was against a stellar Q4 for Advanced Therapies in prior year. They had very high equipment growth. In absolute terms, Q4 was still the strongest revenue quarter in the fiscal year also for Advanced Therapies. Profitability was excellent in Q4 again. Taking out the dilution from Corindus, the margin was at the level of the stellar Q4 in prior year, also an excellent finish in a challenging year. Now let's have a closer look at the Diagnostic performance in fiscal year '20. Diagnostic is a segment that is exposed most directly to changes in the procedure dynamics. As you know, 90% of revenues are reagents, which are booked and built with more or less the actual testing of patients. Within the actual testing volumes, testing for routine care is especially important since they make up the baseload of reagent volumes. And as you know, the reagents carry the gross margins in the business model of Diagnostics. Now with a steep decline of this baseload of reagent volume, this dropped through to margin level, and therefore, the adjusted EBIT margin has been significantly impacted in fiscal year '20. The upside from COVID-19-related tests could only partially compensate the negative drop-through as most of the upside came from a locally sourced PCR-based test in India with a significantly less favorable contribution margin. Besides the volume impact on margins, COVID-19 had further negative impacts on cost items. Due to declined reagent revenues and less instrument placement, we saw an underutilization of capacity. The underutilization resulted in an -- obviously an under absorption of fixed costs at our manufacturing sites. Bear in mind that we had built out our sites in the last years to prepare for the ramp-up of Atellica Solution and the need for additional test volume. We also saw additional costs, in particular, for new R&D projects to prioritize tests for COVID-19. At the same time, access to customer sites was partially limited due to COVID-19 protocols at our customer site. This delayed field upgrades in order to mature the Atellica installed base. Besides the extraordinary headwinds on the business from COVID-19, Atellica is still in the investment phase. Since Atellica is in the early innings of its lifetime, bear in mind, diagnostic platforms live for 20 to 30 years, we are still investing in service for its growing installed base and in maturing its systems. This is foundational for margin improvement in the Atellica franchise in the fiscal year 2021 and beyond. Also, we continue to see high seeding rates in Atellica Solution, which are an investment in the beginning of each contract. A good example is the Quest contract, where we saw associated investments running this fiscal year and harvesting returns in the outer year. We also did investments in fiscal year in our Diagnostic portfolio with investment into the R&D pipeline of our more recent Minicare acquisitions in point of care. Currency was also a headwind in fiscal year '20. All in all, fiscal year '20 was negatively impacted by the pandemic and by other headwinds like foreign exchange with continuing to invest into the Atellica franchise. This brought the adjusted EBIT margin down to 1.8% in fiscal year '20. From this low level in fiscal year '20, we expect sequential improvement in both top and bottom line, driven by reagent recovery from improved utilization of our factories and from the investment in Atellica Solutions. Now let us have a closer look at the excellent cash performance this year. We generated a free cash flow of EUR 1.883 billion pretax. This was the largest free cash intake of Siemens Healthineers since the IPO in fiscal year 2018. This excellent cash generation during a global crisis shows impressively what our resilient portfolio is capable of. Equally, it shows what our teams are capable of: to ensure focused operations from order to cash even within a crisis situation. At this point, I want to explicitly thank all of our colleagues who contributed to this record cash intake. Now let us have a look at the building blocks of the free cash flow on the right-hand side of the chart. The change in operating working capital took off only around EUR 150 million with a very favorable development in accounts receivables despite the very strong revenue quarter at fiscal year-end. This was driven by a focused management on the account receivable, in particular, the overdues. Additions to intangibles, property, plant and equipment and operating lease used around EUR 850 million of cash. As Bernd has highlighted earlier, our innovation engine runs at full speed, hence, also our investments in R&D, factories and new products. Consequently, our additions to intangibles and property, plant and equipment remained roughly on prior year level, whereas additions to operating leases were down slightly but are still at a high level, considering the very special year. At this point, let us change gears a little bit. Let us have a look where we currently stand with the acquisition of Varian Medical Systems, an acquisition, obviously, that will not only be transformative to Siemens Healthineers, but more importantly, will transform the way how we fight cancer. As you probably have followed closely in the news flow, we have already achieved 2 important milestones: firstly, Varian stockholder overwhelmingly approved the merger agreement with an over 97% approval rate; secondly, we obtained the United States antitrust approval. On the integration side of things, we are well on track with our planning to ensure day 1 readiness. This is not only limited to the more technical aspects of an integration, but also considers the mutual respect between the 2 leading players. A vivid example of that mutual respect is that the decision, for example, for the consultancy support for the integration has been taken jointly. On the financing side, you all know well that we successfully placed 75 million new shares with proceeds of slightly more than EUR 2.7 billion. We are very happy with how the placement went. It was the largest ABB by a German corporate and probably the largest placement in percentage of free float ever. We are happy for 2 reasons mainly: firstly and foremost, for the trust that we received in such a large placement; and secondly, it puts us in a very favorable position that we can decide on the optimal financing mix for the transaction. Whereas we know and understand that there is a need for clarity of the final financing mix, we are still too early in the process. In the general meeting in mid-February, we will obtain the approval for further potential raise of equity. After that, when we have all options on the table, we carefully look at the debt and equity markets and then decide on the optimal financing mix and its timing. In the long run, an optimal financing mix, well prepared and executed, will be most beneficial to the company and its shareholders. Now looking at the other upcoming milestones of the transaction. We have filed for regulatory approval in all major geographies. We do not see major risks due to the fact that the 2 companies do not have an overlapping portfolio. We are on track with our filings and consequently expect closing as initially communicated in the first half of the calendar year 2021. Speaking of 2021, let me draw your attention to the time line on the lower end of the slide where we show what to expect in 2021 in terms of communication. Obviously, we are now today at our Q4 results. In 2 weeks' time, we will host the Siemens Healthineers Shape 22 event. This is a new event prior to RSNA and AACC, a virtual forum for insights and innovation and how we will shape the future of health care. In these times where you cannot unveil with raising the curtain physically at a booth, we unveil breakthrough innovations in virtual settings. On the same day, after the Shape 21 event, we will host a follow-up of our Meet the Management in London from last December. At this, also, of course, virtual event, analysts and investors will have the opportunity to then ask firsthand questions to the segment management. The invite will be sent out in the course of today. Next will be Q1 results at the beginning of February, followed by the Annual Shareholders Meeting in mid-February. By the way, we moved the date to mid-February as the German regulators prolonged the exception ruling to go for a virtual general meeting, and we share -- and will share the infrastructure for the virtual event with Siemens and Siemens Energy. After the expected closing of the Varian acquisition, in the first half of calendar year 2021, we plan to host a Capital Market Day in autumn 2021. On this Capital Market Day, we want to present you in more detail the new combined company and the 2 leaps towards the future of health care. Now let us have a look how procedures have developed in the last month. Let me point out that this is -- that this commentary is based on data until October 18. By the way, I also looked at the data of this week, not in the slide deck, they still look very, very similar. But let me first highlight again the cadence of drivers for our business. First are the procedures that create demand very directly in Diagnostics and more indirectly in Imaging and Advanced Therapies. Demand then triggers orders that then become revenues and profit. Therefore, procedures are the defining precursor for the growth profile of our business. On this slide, we are looking at the number of tests in central lab volumes as precursor for our in vitro business and at the number of MRI exams as a precursor for our in vivo business. We deliberately picked MRI because MRI is, so to say, not positive -- has no positive tailwind from COVID-19 exams. We can clearly see that for in vitro, the number of new COVID-19 cases had a clear negative correlation with in vitro procedures at the beginning of the pandemic. We also see that this correlation has been muted with the recent increase in new COVID-19 cases until mid-October. We believe that this is due to the fact that everyone has learned more about the disease, how to manage to avoid infections and also our customers have adjusted their processes accordingly just as we all have adjusted with wearing masks and adhering to social distancing. What we also see is that in -- that in vitro procedures are not back fully to pre-COVID levels, but we see a trend towards a normalization. For example, in China, where ambulatory care is performed at hospitals only and testing for routine care only comes back when people are coming back to the hospital. Similarly, for our in vivo business, here, we also see that procedures are closely back to pre-COVID levels but see a trend towards stabilization of procedures despite the volatility in COVID-19 cases. These development and trends are important for our view on the upcoming fiscal year 2021, where we based our outlook on the assumption that the environment for routine care testing will continuously improve and that normalized procedure volumes will bring investments in the United States back to normalized levels beginning with the new calendar year. Consequently, our outlook is based on the assumption that current and potential future measures to keep the COVID-19 pandemic under control do not negatively impact the demand for our products and services. However, while we cannot fully foresee the impact of a second wave, these are our main assumptions as of now based upon stabilizing procedure volumes despite an increasing incidence of COVID-19 cases. And coming from our bigger-picture assumptions, this brings us to our guidance for fiscal year 2021. Before we dive into the details, let me share some important points in this -- in the beginning. First, as mentioned before, we saw a translational headwind in Q4 of about 5 percentage points. We assume this headwind to persist in fiscal year '21. So we expect a negative impact from foreign exchange of close to 5% in the top line. This drops through to the EBIT level, but we do not expect a material additional negative transaction effect from foreign exchange. Second, we had an increase in our outstanding shares from our ABB transaction in September to 1.074 million (sic) [ 1.074 billion ] Shares as of September 30. This share count is the basis for our EPS calculation for fiscal year '21. And third, we slightly updated our definition of adjustments for EBIT and EPS. We diligently look at the justification and materiality of each of these adjustments, obviously, especially the topic of materiality has changed with regard to the Varian transaction. The impact on already reported figures is very, very limited and we updated it for the outlook comparison, and it is on the adjusted EPS side about EUR 0.01. You can find a restatement of the most important KPIs also in the appendix of this presentation. Let me start with our outlook for revenue growth in fiscal year '21. We expect the group to grow between 5% and 8% comparable. The wider range of growth caters for the higher uncertainty than normal and is based on the assumptions of recovery and stabilization of procedures as well as additional opportunities from potential upside from COVID-19 testing. Breaking this down to the segment level, it means for Imaging, we expect growth to return to at or above 5%. For Advanced Therapies, we see a similar dynamic. We expect growth to return also to, at or above 5%. An additional dynamic with Advanced Therapies is the robotic business, which should be accretive to growth in fiscal year '21. However, on the backdrop of the pandemic, this is too early to quantify. For Diagnostics, we expect growth ranging from mid-single digits to high single digits. The lower end of this range represents more or less a rebound to revenue levels prior to COVID-19. The upper end of the range assumes a rebound, additional organic growth and a material revenue contribution from COVID-19-related tests. However, there are further opportunities from COVID-19 tests depending on market dynamics, basically, the supply and demand of such COVID-19 tests. If these opportunities materialize, it could provide an upside potential to push Diagnostics even above the high single-digit growth. Now to our outlook on adjusted earnings per share in fiscal year '21. We expect adjusted earnings per share between EUR 1.58 and EUR 1.72. This compares against the comparable EUR 1.61 adjusted EPS in fiscal year '20 restated for the updated adjustment definition. To make a year-over-year comparison, you need to take into account 2 main topics. One topic is the higher share count in fiscal year '21, as discussed before. With the share count increasing by over 70 million shares from 1 billion, this dilutes the year-over-year EPS development by roughly 7 percentage points. The other topic is foreign exchange. The expected translational headwind on revenues close to 5 percentage points dropped through to the EPS ceteris paribus. The transactional effects from foreign exchange are more volatile, but with close to 5% translational headwind and the hedging rolling off, we would expect slight headwind from transactional effect as well but not material. This is an important element to understand when comparing the midrange point of our guidance with consensus EPS expectations for fiscal year '21. From our point of view, the consensus does not take into account the full foreign exchange impact from the translational and probably even less so from a transactional perspective. Adjusting the consensus expectation for this, it would likely be very much in line with the midrange point of our outlook. Taking out the topics of share count and foreign exchange, we would see a comparable growth in EPS between 10% and 18% year-over-year. This is also in line with our previously communicated ambition to grow EPS by around 2x of revenue growth. Now let us have a look at the determining factors for EPS, starting with margins. We expect our adjusted EBIT margin to improve by over 100 basis points year-over-year. Imaging is a major driver for this improvement, where we expect margins to improve year-over-year by around 100 basis points. For Diagnostics, we expect the adjusted EBIT margin to recover to at least 5%. If additional opportunities from COVID-19 tests like the Antigen Test would materialize, as commented on in the revenue outlook, it would provide further margin expansion potential. In Advanced Therapies, we expect to keep industry-leading margins, roughly on prior year levels despite the dilution from Corindus. Our financial income, net is expected to be between EUR 60 and EUR 80 (sic) [ EUR 60 million and EUR 80 million ] of expenses. The tax rate, we expect to be between 27% and 29%. This range represents what the company is structurally set up for in terms of tax exposure currently. Bear in mind that the tax rate in Q1 to Q3 in fiscal year '20 was between 27% and 33%. Only Q4 was substantially lower due to the positive discrete items I mentioned beforehand. Finally, I would like to provide you with some indications on Q1. Of course, this is also linked to the same assumptions as the fiscal year outlook, especially in regard to the assumed stabilization of procedures despite increasing infection rate. We expect the group comparable rate to be back to positive territory, clearly below the range for full year, having in mind Q1 last year was a decent growth quarter not impacted by COVID-19. Margin, on the other hand, was rather weak last year. We expect Imaging to be the driver for better performance there, while Diagnostic margin is expected to be positive but still behind last year's Q1 margin. And with this, I hand it back to Bernd, who will take you back in terms of flight level, dealing with our delivery in terms of strategy implementation.

[Bernhard Montag, President, CEO & Chairman of Management Board]

Flight level, nice comment. Okay. Thank you, Jochen. We have shown you in detail what we have achieved throughout this demanding year 2020 and on which grounds we are looking more optimistically towards 2021. Now I would like to show you where we stand on our strategic journey to ensure market leadership up and beyond 2025. Over 2 years ago, we made a promise, a promise to shape the future of health care. When we IPO-ed the company in 2018, it was clear that this was aimed at supporting our Strategy 2025. This year, we concluded the first chapter of our upgrading phase. And even though it was a year facing a global crisis with the COVID-19 pandemic, we never lost focus to deliver on our priorities to shape the future of health care along our 5 so-called strategic quests, which are precision medicine; therapy of tomorrow; technology-enabled services; patient journey stewardship; and digital, data and AI. And at the same time, as promised, we have tapped into adjacent growth markets to further improve our growth profile and to leverage our economies of scale, and we continue to constantly work on optimizing our product and service portfolio in our focus areas. In fiscal year '19, we have made an important move forward in the execution of our strategy with the acquisition of Corindus Robotics, investing into the theme of therapy of tomorrow. And in 2020, with the planned acquisition of Varian, we pave the way to become a market leader in cancer care, one of the most complex diseases. With cancer, we are addressing a disease, which is one of the biggest burdens of mankind, which is key for our customers and in which our combined skills will make the difference. Thus, we continue to deliver on our strategic promises: further enlarge our innovative product portfolio and step into adjacent markets like vascular robotics and become a market leader in cancer care. With this, we are in an even more -- we become an even more holistic partner for our customers, putting us on track for our aspiration of market leadership beyond 2025. So what makes us so confident that we can continue to deliver on our promises even in the light of the current global pandemic crisis? We are confident that our products and services are and will be even more relevant than ever before, whether it is for the diagnosis of COVID-19 patients with our in vivo or in vitro product offerings or for any other major disease. It all starts with diagnosis. Our products create touch points with patients along the entire clinical pathway, and with our planned takeover of Varian and last year's takeover of Corindus, we are more and more growing into therapy space. This creates an unmatched symbiosis of market-leading product, service and software offerings in the field of diagnosis and treatment, all supported by comprehensive AI and digital offerings. We believe that with Varian and also, on a certainly much smaller scale, Corindus and our consistent innovative product rollouts and scale, we will become more relevant in the future, get to a different growth profile and become even more resilient. Demand for diagnosis and therapy products and services is driven by fundamental trends such as demographic shifts, increase of chronic diseases and better access to health care in emerging markets. This ultimately drives procedure growth, creating the need for precise diagnosis and therapy solutions. Health care providers, governments, and at the end of the day, the society must handle ever-rising number of patients that need diagnosis and therapy. That creates challenges for health care providers, which have to master the shift to value-based health care, reimbursement changes and staff shortages, which drives consistent need for higher efficiency and industrialization. And this is exactly where our solutions come into play. This is where we have unparalleled offerings in our portfolio, whether it's our digital solutions, AI protocols, our high-throughput diagnostics instruments like Atellica, our state-of-the-art imaging equipment with the best workflow and quality in the market. The fundamental growth drivers and the need in the health care industry for increasing efficiency, more precise diagnosis and therapy will continue to grow demand for our products and services. And these fundamental circumstances are here to stay even and maybe even more so in a crisis situation like COVID-19 as efficiency and productivity gains will be key maneuvering through these rough waters. In coping with these ever-growing needs, continuous innovation is key. In 2020, we never lost focus despite the pandemic when it comes to continuously innovating and delivering on our upgrading targets. As a result, we can present you an impressive lineup of innovations on which we will provide more detail than today at our upcoming Shape 21 product show event. As already said by Jochen, you should have an invitation for this event in your inbox in the course of the day today. As already indicated at our Meet the Management in December 2019, we are working towards major product and digital solution rollouts in Imaging. We will launch a new MRI system with a unique compact design, which will set new standards in the market and will allow us to enter and create new markets. It will be able to bring MRI systems to where they haven't been before. With our revolutionary CT photon-counting technology, we will provide higher clinical value and reduce radiation dosage at the same time. Since we talked about this last year, we have made significant progress in the development. We are confident that these innovations will underpin our very strong positioning in the imaging space, allowing us to further outgrow our addressable markets. Our Diagnostics team has done a superb job and timely launched high-quality COVID-19 tests. Whether it's an antibody, PCR or our antigen test, we have the full offering. In addition, we made progress towards launching our new integrated immunoassay and clinical chemistry Atellica analyzer for midsized labs with lower throughput, complementing our portfolio besides the Atellica Solution for high-throughput labs. In our Advanced Therapies business, we remain fully convinced that robotics will play a major role in minimal invasive procedures in the future. In 2020, we have seen a very successful continuation of our ARTIS icono rollout, a proof point that innovation is a key success factor. Hence, our funnel of upcoming highly innovative product rollout is strong and will make us even more competitive and relevant for our customer base. Once the acquisition of Varian is concluded, we can even further expand our product offering along the entire clinical pathway of cancer care from diagnosis to therapy. We know that it will help us to extend our market-leading positions, further take market share and to continue to capitalize on the depth and breadth of our portfolio. This unmatched depth and breadth of our portfolio and our strong access to C-level decision-makers at leading health care providers has also been key for us to substantially increase our Value Partnerships in 2020. In a year of the global pandemic, our order intake with Value Partnerships increased significantly to an overall order intake of around EUR 1 billion in fiscal year 2020. This successful expansion is evidence for the strong relationship we have achieved with our customer base. These long-term partnerships allow us to reach an entirely new level of strategic alliances with leading health care providers around the globe. They help us even better understand the needs of our customers while, at the same time, improving transparency and visibility for us and our customers for many years. It creates new growth opportunities, and we benefit from the ongoing consolidation trend in the health care provider space. So before we conclude today's presentation and open up for Q&A, let me reiterate our strategic and financial aspirations are unchanged. With our strong product rollout, our unique positioning as a holistic partner for health care providers and the unchanged fundamental growth drivers in our business, we remain confident to execute on our targets we communicated a year ago, which is to deliver above 5% comparable revenue growth and around 10% adjusted EPS growth in the midterm. However, to be fair, the acquisition of Varian will impact this situation. Currently, it has only led to an increased share count, but I'm very optimistic that we have a chance to see higher numbers on this chart come autumn next year, i.e., when we fully integrate Varian into the picture. The acquisition of Varian will lift us to a next level by making 2 leaps in one step. With our support, Varian will make a leap to the next level in cancer care. With the integration of our capabilities in imaging, digital and AI, Varian will be able to offer the broadest product portfolio in cancer diagnosis and therapy. For us, the envisaged integration of Varian means a leap in impact and a materially higher level of relevance for our customers. With our unique technology position and clinical understanding from prevention to in vitro and in vivo diagnostics to therapy and posttreatment offerings, we become the most holistic partner for the entire spectrum of our customers with the most comprehensive portfolio for all major diseases. To conclude. Despite facing a global crisis, we have shown that our business is resilient. We look optimistic towards 2021 and beyond. And we continue to work on rolling out unmatched, innovative products. And with the planned acquisition of Varian, we are set to build an even stronger company to shape the future of health care. With that, I believe it's time for Q&A, so I hand it back to the operator.

[Operator]

[Operator Instructions] We will take our first question. It comes from the line of Patrick Wood from Bank of America.

[Patrick Andrew Robert Wood]

The first would be the guidance for next year implies a pretty decent number in terms of hardware and equipment sales on the Imaging side, and I'm just curious to see what gives you such confidence? Is it the backlog and the funnel of conversations? Is it what the hospitals are saying to you? Is it the innovation? I'm just curious as to what gives you confidence that you're going to be able to place systems at that kind of a rate next year, and if there's any implications for hospital access due to COVID. That's the first question. And then the second question is, basically, you talked a lot about the value-based care contracts and things on that side. Could you maybe share with us some, they can be hypothetical, but examples of the kinds of contracts that are being set up? Is there risk sharing in terms of patient volumes? Or is it more about you guys being measured on uptime and either paying or being paid based on that? Just some idea of the flavor around the kinds of contracts you're seeing.

[Bernhard Montag, President, CEO & Chairman of Management Board]

Yes, Patrick. On the guidance for the next year, I mean, first of all, it's clear that this is certainly not an easy moment for any company to give a guidance here in -- but the confidence comes here out of, on the one hand, the order book; on the other hand, that we have a high share of recurring revenue. We have service as a stabilizing factor. And also, when looking at the regional distribution, we feel confident when looking into the details of what is the situation in China, which is a continuous growth engine, Europe also being a very stable factor and a slight recovery in the United States, yes, coming from the sharper impact in this year plus the innovation which you mentioned here.On the so-called Value Partnerships, this is mainly long-term arrangements. The big portion is in the United States, yes. For example, UPenn, WakeMed have been booked in Q4. These are typically multi-year contracts where we go into -- I mean the guarantees we take is, on the one hand, uptime. Of course, on the service side, it's the continuous delivery of equipment. We go into smaller topics where we share risks or opportunities when it comes to improvement of workflow and process changes on the customer side. And what also really plays a big role in these partnerships is the digital offerings, which we bring into it. Plus, very helpful also is the acquisition of ECG so there that is very often now also a consulting piece in these arrangements.

[Jochen Schmitz, CFO & Member of Management Board]

One aspect to it, I think, is that the performance risk of those contracts is not very large for us. The performance, we do not super risky stuff. It's all proven stuff, but we are able to establish a longer-term relationship on, I would say, on more or less standard terms, and the customers do benefit from our advancements in technology and service offerings.

[Operator]

We will take our next question from the line of Veronika Dubajova from Goldman Sachs.

[Veronika Dubajova, Equity Analyst]

I will also keep it to two. My first one is just thinking about the guidance, and I want to follow up on a couple of the comments that you made, both Jochen and Bernd, you made in terms of what it assumes for the Diagnostic picture. Just would be great to understand exactly what is the size of opportunity from COVID-19 that you've embedded. And if you can give us some flavor for what your antigen manufacturing capacity is today and how it will evolve over the year, that will enable us to make a call on what we think that contribution should be. So that -- if you can talk to that, that would be very helpful. And then my second question is, and apologies if I've missed this, but I'm not sure if you told us what the order growth was for the quarter. And if you could tell us, please, that would be great. But just your thoughts on the sustainability of that as we move into Q1. Just curious, I mean do you think we are now back to consistent year-on-year positive order growth as we transition into 2021? Or is there any uncertainty that you still see on the margin when you talk to your customers when it comes to hospital CapEx?

[Jochen Schmitz, CFO & Member of Management Board]

Yes, Veronika. Thanks for your question. On the guidance side, let me first start with explaining again why did we have those assumptions in place, not only to protect ourselves giving a guidance, but based on what we see out of the -- of the data from the usage of our system. That's the main driver behind those assumptions. And we saw this development in a very, very steady progressing way even throughout times when, in particular, in the United States, the pandemic was still super active and that is the basis for those assumptions.The guidance currently does include -- in particular, the guidance on Diagnostic does include a material portion of antigen tests. And I would say, if you want to quantify it, it's in the ballpark of low triple-digit million revenue.We are currently ramping up the capacity. I mean we have, obviously, plans together with our partner here to ramp it to a very significant number per month. But as you know, this is never fully without risk and you need to have the whole supply chain in -- so to say, in order to make this happen. Therefore, I would not give you a guidance now on the monthly capacity we will achieve, but it will be much more than the low triple-digit revenue line we have baked into the Diagnostic guidance so far.On the order growth side for fiscal -- for quarter 4. Order growth was, in its totality, across all businesses, including service, plus 6%. And on the equipment side, it was flat on the super high number of last year. So therefore, we were very satisfied with this development.

[Veronika Dubajova, Equity Analyst]

And can you talk to the pricing of antigen, how you're going to position it versus the other tests on the market?

[Jochen Schmitz, CFO & Member of Management Board]

Pricing currently is in the mid-single-digit euros per test. I mean, obviously, it's also depending, as the fundamental laws in economics, on supply and demand. Currently, it's in the mid-single-digit euros.

[Operator]

[Operator Instructions] We'll take our next question from the line of Lisa Clive from Bernstein.

[Elisabeth Decou Bedell Clive, Senior Analyst]

Two questions for you. First, thanks for the detail on your increasing base of long-term partnerships. Could you just run us through how the accounting works on those contracts? If it's across Imaging and that hospital system will be buying machines over a 10-year period, are you paid a sort of -- I know every contract is different, but if you could give us any general characteristics. Are you paid sort of a set amount every year? Or is there some lumpiness around when you actually install units over the course of that, say, 10-year contract? And then second question, the Fresenius SE CEO last week mentioned the German Hospital Future Act sets aside EUR 4.3 billion for providers to invest in modern emergency capacities and better digital infrastructure. I'm just wondering if there's any specific upside for your business units around this investment and whether you've seen anything like it in other countries thus far.

[Jochen Schmitz, CFO & Member of Management Board]

Okay. Lisa, let me start with the first question. The revenue stream on those Value Partnerships is roughly 2/3 is recurring. And the other -- so what I say, and I'm now arguing very conservative with 2/3 recurring only. The others are, so to say, a firm commitment of the customer, but they are tied to their acceptance, so to say, or the timing of when the instrument is installed. Therefore, it's not 100% recurring. It's not a monthly charge we get, but it's still very, very firm. Therefore, we like this business a lot because it's 2/3 fully recurring roughly and the rest is a firm commitment over the contract duration.

[Bernhard Montag, President, CEO & Chairman of Management Board]

Yes. Second question, which was about, if I understood correctly, about the German law. I look at it as this is one of the stabilizing factors, which makes Europe, in total, a stable contributor to the growth targets we have but also to what we have seen in the last year. I mean take Germany as an example here. Hospitals got reimbursed, so to say, for empty beds, which was also a kind of a state subsidy during the COVID, the first wave in the March-to-June time frame. And this type of safety and security for our customers -- hospital-based customers in Europe in many countries is one of the aspects why the business is stable and we are also confident for the future. It is partially maybe offset by -- when you look at private imaging centers, there's maybe a little bit more of caution, but it helps, in the end, to support what we have given as a guidance. I would not see an additional upside to what we have said. It's more a baked-in aspect. And bear in mind, just as a number, roughly, Germany is, I think, about 7% to 8% of our total revenue and half of it is recurring revenue, yes? So any movement in one country is normally averaged out, which is one of -- also one of the messages I gave when I talked about the resilience of the business.

[Elisabeth Decou Bedell Clive, Senior Analyst]

Okay. Bernd, that's very helpful. I suppose -- I guess specifically just thinking around if we do end up in a prolonged recession and CapEx budgets often do get tightened in that environment, do you think it will be different this time, given that there may be specific funds set aside like what Germany has just laid out?

[Bernhard Montag, President, CEO & Chairman of Management Board]

Yes. I think on -- in Germany, let me take a step back. I mean I think the CapEx cycle discussion is mainly one circuit around the United States, yes? And now when you look at the order intake we had there, the commitments to long-term partnerships, also when you look at the Varian numbers, by the way, which came in also very positive, I'm very, very happy with -- very happy also what we saw there. It showed that there is quite some resilience also in the United States when it comes to this highly critical topics of taking care of patients, which is not about COVID. So as I said, the European growth is helping us to offset what we see in some of the more, let's say, private -- or let's say, more market-driven health care economies like the U.S.

[Operator]

We'll take our next question from the line of Michael Jungling from Morgan Stanley.

[Michael Klaus Jungling, MD, Head of MedTech & Services and Analyst]

I have 2 questions, please. Firstly, on the 2021 guidance, if I look at the cheat sheet that you had sent out, it does say in the footnote that the guidance is predicated on the pandemic in "being under control." I mean if we look at what's happening in Europe now, one could argue that it is not under control and that it's getting worse. And therefore, are you seeing a chance here that you could come back to us after Q1 results, and you say, well, it's not under control and we have to make an adjustment to our guidance. I'm just curious what you mean by under control, and are we already below that threshold? And then question #2 is on the antigen test. I was hoping you could provide some more color on a few things. What are the critical success factors, for you, of generating revenues? What do you need to do to be successful in selling antigen tests? And have you really secured some large tenders? And also in which countries is the test now available?

[Jochen Schmitz, CFO & Member of Management Board]

Yes. Thanks, Michael. Let me start with your first question on the guidance. First of all, what we wrote in the cheat sheet, by the way, it's in the earnings release, it's the same font size as the guidance text, so it's not a, so to say, part hidden yes? It is -- that we said we assume -- or we have the assumption or we baked or we based our guidance on the following thing that we believe -- that we said that the measures, the lockdown measures, which are taken -- potentially taken or currently taken or potentially in the future taken do not impact the demand for our products and services, yes? And we qualified those lockdowns measures as measures, which obviously are hopefully taken by government to control the pandemic. So we did not say when the pandemic is under control. We referred it to the lockdown measures.And why did we say this in this precision? Because, for example, in Germany, in the first lockdown, there was a clear guidance to every hospital to just focus on COVID-19. This regime has changed with this lockdown, for example. This guidance is not there anymore. Now that does not mean it is not there because hospitals and customers adapted their processes to it and things like this.And again, what I tried to highlight is that we say the basis for this assumption, and that is not an assumption which comes out of the blue, so to say, is the machine data we saw even during times of super-spreading pandemic situations in, for example, the United States. That's the basis for you.On the antigen tests side, we have the regulatory approval for Europe. We are currently starting to ship the first tests into -- in particular, also into Germany, but we expect to see also demand coming from across Europe. And we have already a decent backlog of firm orders in the sizeable double-digit millions available. And we are currently in the process of getting the approval in the United States. Also there, the funnel is building up. And obviously, currently, there is -- and particularly when you also listen to government representatives across Europe, you hear a lot about their hope on the antigen tests, by using the antigen tests broadly to be able to keep lockdown scenarios to a meaningful level. For example, I think it's in Slovakia. Slovakia, the Prime Minister said that they want to test the whole population of Slovakia on a regular basis. I listened to Boris Johnson, I think it was on Wednesday night when he talked about using antigen tests very, very broadly to be able to minimize any lockdown scenarios and things like this. So different to the antibody tests, we believe that there is already, today, more demand for it -- significantly more demand for it than with the antibody tests. The antibody tests, as said, we expect them to get into more demand when vaccine is available and then the immune reaction is necessary to be tested. That's for the antigen test.

[Michael Klaus Jungling, MD, Head of MedTech & Services and Analyst]

Jochen, can I just follow up then on the antigen test? So what are the critical success factors to make sure that you can sell as much as you can versus, let's say, some of your 2 major competitors? I'm trying to understand whether you have the framework in place to be successful. What do you think that is?

[Jochen Schmitz, CFO & Member of Management Board]

I think, generally speaking, it's the quality of the test. It's an intact supply chain. And then what we currently see is that there is clearly a demand overhang currently. And therefore, I'm relatively assured that when we have the first 2 things in place, which we have -- which we will have, then we will be successful with this test as long as the demand is there. And currently, it is there.

[Operator]

We'll take our next question from the line of Scott Bardo from Berenberg.

[Scott Bardo, Analyst]

Yes. So just to start off, please, on the Diagnostics business. I think you outlined a picture of recovery for the Diagnostics business as compared to maybe volumes in 2019. But you're suggesting broadly half the margin of 2019, and I think that 2019 was seen as a trough year of margin for Diagnostics. So I wonder why you're not being more bold here. Following on, please, from this. We've heard now from Roche and others that demand for antigen test is very high, higher than supply. Siemens Healthineers was very competitive with serology capacity as compared to other leading diagnostic companies, yet Roche and Abbott are manufacturing tens of millions of these tests per month. And I think your comments about maybe low triple-digit millions only implies 2 million or 3 million tests a month. So what I want to understand is do you have the ability to be competitive from a capacity standpoint? And indeed, if that is the case, could we see some material uplift to the guidance that you've currently outlined for Diagnostics? So that's the first question, sir, please. And the second question, just pulling on a comment that you made about how the group aspires to grow the bottom line around twice the pace of the top line development. Is there any reason to assume that, that dynamic changes on the integration of Varian?

[Jochen Schmitz, CFO & Member of Management Board]

Scott, thanks for the question. I'll start with the second one. I would say we will go into more detail in this regard when we have the closing done and most likely -- maybe already with Q2, but the latest with Q3. That's our current assumption.On the Dx side, when you look at the profitability development from fiscal year '19 to '20, and by the way, the guidance for this -- for fiscal year '20 was that this is trough, and not '19 was trough. You said slightly down, we need to be precise when we went into the year last year with the guidance. The -- when you look at the profitability development relative to '19 and '20, roughly 50% of margin decline, roughly, came from volume and mix. And this is -- was primarily, almost in its totality, driven by COVID-19.Then on top, what we obviously see is that we are in a different volume level by this. We have, on top, underutilization of our manufacturing capacity, which is obvious. Secondly, we invested in R&D for COVID-19 to cater for the needs of new tests. And then I think one major cost item are logistic costs, higher logistic costs because the airlines and freight rates went up significantly. We're talking about healthy double-digit million numbers for the full fiscal year. Then obviously, we placed more Atellica. That means we have seats and we have more amortization. We still have a growing installed base on Atellica, which caters for service capacity. And then, lastly, significant headwind from foreign exchange in Diagnostics, in particular, in Q4, but also throughout the year in the 60 basis points arena. And then we also -- in the Minicare acquisition, it's an early-stage acquisition, we have higher hopes and expectations for this business. It's about high-sensitive troponin on a point-of-care device. And this is also a lower double-digit investment amount. So that is, so to say, the bridge toward the profitability in -- from '19 to '20. Let me talk about next year or the current year '21. We expect a significant positive impact from volume and mix. But -- and this leads over to your question on the antigen test side. We are not a rapid test producer, generally speaking. We are not in that business. But we came relatively quickly to a partnership agreement with a U.S.- Chinese firm. And therefore, this test does not cater for the same level of contribution margin as our self-developed classical IA or point-of-care test just to make this clear. And therefore, we do not have our own manufacturing capacity in place for it, but our partner. And we support the partner, obviously, where we can and that's why we are currently, I would say, a bit more cautious on what we commit here.And what I said before is what did we bake into our guidance for the 5% up to, whatever, 9% or higher single digit is an amount of revenue of low triple digit. And we clearly articulated that it might be -- or that we might see -- or that there is potential upside to this, which would then bring this number, if everything else stays as we plan it, up or even beyond this 5% to 9% range. That's how we said it.

[Scott Bardo, Analyst]

All right. Just one point of clarification then because I think Abbott mentioned some 50 million tests a month, Roche up to now 100 million tests a month. We're not to expect that from Siemens Healthineers by your comments here. But you are a laboratory company and you do have good expertise and infrastructure here. So will you be launching a laboratory antigen test, where I imagine demand is very high, and you have tremendous ability to serve capacity?

[Bernhard Montag, President, CEO & Chairman of Management Board]

Yes, Scott. I mean let me chip in here. Yes, we are developing such a test, yes. Whether this will be a huge blockbuster, I think, remains to be seen because the beauty of the antigen test is what Jochen and I and Marc and so on have gone through today in the morning that you get the result within 15 minutes.And so it's the point-of-care, the beauty of the, say, point-of-care or point-of-need, while in the lab, I mean it might be that the net sensitivity specificity values are a little bit higher, but you lose one of the big advantages. So this is why I'm, let's say, only carefully optimistic when it comes to these type of tests. We are developing them. We are also not alone here, as you probably know. So it's part of the portfolio of tests. I think, as another upside, depending, of course, on how things develop on the vaccination front, is the semi-quantitative antibody test, which we have, which could play a major role as a companion test, so to say. So I think we are well equipped when it comes to also on the antibody side. But for the time being, antigen is, from my point of view, a rapid test topic given the current need of society.

[Operator]

We'll take our last question from the line of Julien Dormois from Exane.

[Julien Dormois, Research Analyst]

I just have one question, which relates to Advanced Therapies, which is actually a double question. But the first part of the question relates to the margin achievement you had in AT over this quarter. I think I was a bit surprised by the magnitude of the decline in margin because the dilution from Corindus, you were able to offset that in the first 3 quarters of the fiscal year. So I'm just wondering why, this time around, you were not able to do so. And the second question still relates to Corindus. Could you just provide us with a quick update on the situation there in terms of maybe, I don't know, sales achievements, machines being placed or anything that could help us understand where you're heading with that business? And what are the upcoming milestones for this?

[Jochen Schmitz, CFO & Member of Management Board]

Julien, let me start with the first question. When you think about the top line development in Advanced Therapies, they have seen -- we should not use that too often, but have seen trough in this quarter, Q4 was minus 6.4%. And as you know, we guided for about 300 basis points Corindus impact on the profitability line. For the full fiscal year, this was not 100% evenly spread throughout the quarters. So Q4 was a bit more intense in this regard. And being able then to get -- excluding this 300-plus basis points of Corindus, on a minus 6.4% revenue line to an underlying profitability level, which is -- which was very much in line with prior year, I think, was a success from our standpoint.And so therefore, I feel very comfortable with the margin development in Advanced Therapies throughout the year. They did an excellent job in keeping their costs under control, on the one hand, and being very, very mindful about the successful rollout of the ARTIS icono platform.

[Bernhard Montag, President, CEO & Chairman of Management Board]

Yes. And talking about Corindus and where we stand here. On the R&D side, I'm very happy with what I see. So that is the combination, on the one hand, of Imaging with the existing robot. It is secondly the progress we make in developing the applications in the current version plus the future neuro version, which is -- which will give us the opportunity to expand this into the very important area of stroke treatment. Certainly, the last year did not make it easy here to create adoption with customers simply because of the pandemic. This is a highly interactive topic with demoing the robot. It is taking people aside, and that was, certainly, the last 9 months have not been the ideal environment for teaching hospitals a new procedure. So their minds were somewhere else, and there were some real limitations when it comes to working together intensively.So that is the only topic, which created a bit of a delay in terms of creating an installed base. But taking this aside, I'm very happy with the progress which is achieved.

[Marc Koebernick, Head of Investor Relations]

I think then we're through. And I hope we'll hear you again and see you soon on the road show or virtually, however, and at latest then with our Q1 results next year. Thanks. Bye.

[Operator]

That concludes today's conference call. Thank you for your participation. Ladies and gentlemen, a recording of this conference call will be available on the Investor Relations section of the Siemens Healthineers website. The website address is www.corporate.siemens-healthineers.com/investor-relations. Thank you.