Helmut Zodl: Yes. So, Veronika, we have a very large components of our portfolio is localized. And I would say it’s not close to 100%, but not far off 100%, that’s how I will answer the question for most of our modalities. And we continue to expand that on an ongoing basis because it’s not only the localization of the manufacturing, but there’s also the innovation in China. So having specific product that’s really made for China, made in China, that’s really how we look at it. So innovating for the China market then accordingly. So this is quite high percentages. The teams worked very hard. And we have a long €“ as Pete said earlier, we have a long history in China. It’s an important market for us. Our brand is very well recognized, which we are proud of and we are continuing to innovate for customers in China.
Peter Arduini: And I would just to put a finer point, Veronika, I mean, for what we have set as our operating plan for 2023, we have all of that localized and feel quite good about it. As Helmut said, as we bring new products out, one of the big question is, how much you’re going to localize versus not. But for what we need to compete, we’re in a very good position with localized components and that type of recognition that’s needed in certain types of tenders or constructs to compete.
Operator: Our next question comes from Anthony Petrone with Mizuho. Your line is open.
Peter Arduini: Hi, Anthony.
Helmut Zodl: Good morning, Anthony.
Anthony Petrone: Hi, Pete. Hi, Helmut. Congratulations on the spin and a great initial quarter out of the gate here. So congratulations to the team. Maybe a little bit on new product introductions, MPIs and that is certainly a contributor here. So in the plus 13% overall, I guess what percent of that actually came from new products.? And then when we think about the backlog, what is embedded in there for new products? What percentage of the backlog is going to flow through with newer systems that are recently introduced, let’s say, over the last 12 to 18 months? And I’ll have one quick follow-up on capital allocation.
Peter Arduini: Yes, Anthony, I’ll make some comments and Helmut feel free to jump in. I think again, in this business having new products that bring solutions that solve some of the challenges for customers, in many case, productivity, products that help deal with some of the labor challenges or expertise and then solving big issues for patients. We’ve been quite fortunate with a lot of our launches recently again and some of the classic modalities, MR, CT, we mentioned about the PET system that has integrated AI on it. All of those have played a key role. I think in the fourth quarter, we were in the upper 20s, high 20s or so relative to vitality rate on new products that have been recently launched. My metric typically is if you’re above 20% in that range, that’s a very good vitality metric, then you were closer to 30% within new products that are out there.
I think there’s quite a bit of demand as we talked about for certain products in outpatient centers and there’s still quite a bit of demand in updating, in some levels, an older fleet within the acute hospitals around the world. Helmut, do you want to add anything?
Helmut Zodl: Yes, I would just add, I think as Pete said, so the innovation and the new products are happening really across the portfolio. I just would call out, it’s happening both on the device and I talked about a couple of those innovation in my remarks, but it’s also happening on the digital side. So a lot of AI and machine learning that happens on the device accordingly, which is really a different way of introducing an NPI. So there’s a lot of times spend on that by the team, which really helps clinicians significantly both get more productive, but also help better patient outcomes.