Good morning, ladies and gentlemen. Welcome to our video call in light of today's publication of our half-yearly financial report, 2023. I would also like to welcome the two members of our Executive Board, Oliver Schwegmann and Ralf Brühöfner. As always, Oliver and Ralf will guide you through the presentation and will answer your questions afterwards. You can start with your questions even during the presentation. To do so, please use the chat window, and at the end, I will read out your questions anonymously. One last note from my side: we record this call and will publish it on our corporate website. That's it from my side for now. Oliver, Ralf, the stage is yours.
Ladies and gentlemen, this is Oliver Schwegmann, the CEO of the Berentzen Group, speaking. Together with my colleague and CFO, Ralf Brühöfner , we, as the executive board of the Berentzen Group, would like to welcome all of you to our half-year 2023 results call. We trust that all of you are doing fine. You should have received the presentation by email in advance so that everybody can follow the charts we are referring to. After our presentation, we will, of course, take our time to answer your questions. With today's publication of our half-year financial report, we look back on six months that continued to be directly affected by Russia's cruel war against Ukraine and its consequences on our economy and markets.
Tense and partly brittle supply chains, significantly higher price levels for various raw and packaging materials, as well as for energy compared to pre-war levels, last but not least, high inflation rates that restrict the purchase power of consumers, leading to an increasing abstinence from consumption. Over the past year and a half, we had to take numerous countermeasures to deal with this multidimensional crisis, from massive cost increases to volatile supply chains and from efficiency losses in production to inflation-driven consumption abstinence. Besides adjusted purchase procedures to secure material availability, higher flexibility in our production planning, and strict management of inventories, passing on the massive cost increases to our powerful retail partners was key to rebound towards performance excellence.
As the cost increases kicked in step by step during the course of the year 2022, they have largely arrived in 2023 and unfold their full effect on our P&L. In the first months of the 2023 financial year, we were able to largely pass on the heavily increased costs to our business partners, mainly to the strong German retailers, after a long and tough negotiation period. Now looking at our half-year results, two major effects remain in these figures. Firstly, the successful implementation of our price increases at the powerful German retailers took quite some time at the beginning of 2023, so that the positive effects have only gradually developed. Secondly, with these significant price increases, we were able to cover the costs, but not our pre-crisis profit margins, due to toughest negotiation and risk of delistings.
Our clear goal ahead of us remains to increase profit margins back to 2018, 2019 levels and beyond. Therefore, further price increases are necessary, although powerful German retailers already demanding price reductions. Despite all these challenges, which are reflected in our half-year results, Berentzen remains a solid and well-positioned player on the beverage market with a clear mission and strategy. We are Berentzen. Our purpose is to awaken the thirst for life. At Berentzen, all our employees are motivated and energized to work for the people and society to experience more liveliness, fresh optimism, and joy of life. I always show this chart in our presentations, even though every one of you knows it by heart. However, it is the core of our purpose and the driver behind our ambition, and therefore always worth to mention for a better understanding of who we are.
Berentzen enlights people from morning to evening. Our brands and products accompany our consumers throughout the whole day. We wake them up with a healthy and freshly squeezed orange juice from Citrocasa. We quench their thirst with our natural mineral water, Emsland-Quelle. We offer a refreshing pleasure moment during the afternoon with one of our tasty Mio Mio flavors. We energize the party people with our Berentzen shot liqueurs, and we indulge our consumers at the end of the day with our premium Norden Sea Salt Gin. Berentzen is part of consumers' lives throughout the whole day. The Berentzen-Gruppe has clearly defined its strategic and long-term growth pillars. Each of our business areas contribute to our sustainable, profitable growth path. Within each business area, there is one strategically leading topic to which the organizational focus and the resource allocation is directed.
Those topics are our engine for beyond market growth rates and for over proportional gross margins. Within our branded spirits business, we focus on the consumer demand for socializing and celebrations. Our core focus brands, Berentzen and Puschkin, which are especially known for a wide range of colorful liqueur shots, are a popular accompany for parties, festivals, and many other social gatherings of young adults. Within our private label business, we clearly focus on the consumer demand of highest indulgence and quality at an affordable price. Together with our retail partners across Europe, we develop exclusive top premium spirits at an attractive price, which especially during times of high inflation, offer new shopper groups access to top premium products. Within our non-alcoholic beverage business, it's all about the consumer's demand for exploring new tastes and varieties.
Today, consumers do not stick to the same products, but they want to try new brands, new products, and new taste varieties. Mio Mio is one example how to successfully bring a new and modern brand with a wide range of taste flavors to young and curious consumer group. Last not least, within our fresh juice system business, we give a perfect answer to a growing global consumer mega trend of healthy lifestyle. Consumers more and more strive for a healthy lifestyle with fresh and high-quality products. Citrocasa gives the ultimate freshness experience through a freshly squeezed healthy orange juice at the point of purchase. Now let's turn to chart eight, which gives an overview of the revenue performance. We were able to maintain the turnover momentum ignited last year, and once again generated a double-digit growth rate.
After EUR 79 million in the first half of 2022, we have achieved EUR 89 million after the first six months of this year. In contrast to the 2022 financial year, more than 90% of the increase in turnover in the first half of 2023 was driven by necessary price increases. Nevertheless, there have also been positive volume effects this year, especially in our strategic core topics. According to this, our products remain highly relevant for consumers, even in times of stagnating economy and loss of purchasing power. I will get back to this later in my presentation. First, let's now have a look at the key earning figures. As expected, the sharp rise in costs in the course of 2022 is reflected in our earning figures.
Although we were able to increase the absolute gross profit by around 1.7%, the gross margin suffered significantly due to the simultaneously strong increase in revenues. I mentioned before that during toughest negotiations with our strong retail partners, we were largely able to pass on the costs, but not the costs plus our gross margin yet. Therefore, for the time being, we have to deal with a gross margin decline by 3.9 percent points to 41.6%. In addition, a remarkable increase in expenses for returnable bottles and significantly higher logistics costs had a negative impact on our operating consolidated EBITDA and consolidated EBIT. While our EBITDA fell by 7.5% to EUR 7.3 million, our consolidated EBIT declined by 30% to EUR 3.3 million.
It goes without saying that we are not satisfied with this decline. Let me underline that we started off this year with an even stronger negative impact on the group's earnings figures in Q1, due to our gradually implemented price increases over the course of the first three to four months of this year. The earnings development in the second quarter was already showing in the right direction again, with still quite a long path to go. Our clear and focused goal is to raise and regain the quality of our margins as quickly as possible to go back to the 2018, 2019 level and beyond. The half year figures presented today underline our firm foundation of this journey ahead of us. We demonstrated dynamic revenue growth and also increased our consolidated gross profit despite multidimensional challenges we had to face.
As I said earlier, our gross margin declined in the first half of 2023 by 3.9 percentage points. In strongly inflationary times, this temporary effect has to be accepted and dealt with. As the cost increase for packaging and raw material, for energy, as much as for logistics, hit us suddenly and significantly, it is not possible to increase our prices to the strong retailers in only one go at a rate that covers both cost increases and gross margin stability. Therefore, more steps in future are crucial to regain our margin quality, despite big retailers already demanding price reductions from us. You can imagine that the atmosphere in our negotiations is getting tougher and tougher, as also the retailers suffer from declining shopper frequency and restraint in consumer spendings.
To demonstrate the significant impact of our successful price increases so far, we have adjusted the revenues for the inflation-related price increases. Since the entire increase in turnover is due to price increases and the volume has remained nearly constant, we have put this year's gross profit in relation to last year's revenues. It shows that we were able to pass on both our material cost increases and part of our margin, but obviously, there's still some way to go. The lower gross profit margin is therefore entirely due to the higher revenues and not to lower gross profits. On the next slide, you can see once again that there was a positive impact of the actions we have been taking so far. We were able to increase our EBIT margin by 250 basis points during the second quarter.
In the first quarter, the cost increases had their full effect on our business. In the course of the successfully implemented price increases, we were able to raise our earnings quality again. This goes in line with our expectations for the financial year to date, and we do anticipate a further recovery in our margins until the end of the year. On the way back to our previous earnings quality and beyond, besides further price increases, the over-proportional performance of our strategic core topics play a major role. With the exception of the premium and medium private label concepts, all our strategic core topics have, again, shown a strong growth. I would particularly like to highlight the development of our strategic brands, Berentzen and Puschkin, in the spirits segment, and Mio Mio in the non-alcoholic beverage segment, with growth rates of more than 25%.
This reflects both price and significant volume effects. Despite a smaller rate, but still pleasing in the development of Citrocasa, which is slowly approaching the pre-corona turnover level again. As you know, the fresh juice system segment suffered the most from the corona pandemic. The decline in the premium medium category of our private label business is entirely due to a temporary supply and logistics bottleneck for our strong and significant Bourbon whiskey. Without this bottleneck, also, the premium medium category, as one of our strategic core topics, would have shown a positive development. In the meantime, those mentioned temporary supply challenges have successfully been overcome, we expect the premium medium private label business to be back with growth momentum in the further course of this year.
Before I hand over to Ralf, I would like to briefly present the revenue performance of the individual segments, starting with the spirit segment. In this segment, we were able to increase revenues by 13% compared to the first half year 2022. The development of the focus brands, which include the Berentzen and Puschkin brands, with +25.1%, is impressive. Even the private label business has, as a whole, was able to grow, despite the just mentioned significant one-off effect in the Bourbon whiskey business. The spirit segment, in total, generated revenues of EUR 53.8 million in the first six months of this year.
The highlight of the non-alcoholic beverage segment is once again our Mio Mio brand, which was able to continue its growth sales performance in the second quarter and reached an impressive growth rate at +28.2% in the first half of the year. In total, segment revenues increased by 14.1% to EUR 22.8 million. The very positive development of fruit sales is largely responsible for the revenue growth of 9.2% to EUR 9.5 million in the fresh juice systems segment. This shows that the consumer demand for freshly squeezed orange juice continued to rise, and that our unique selling proposition of our so-called one-stop shopping system, which includes selling machines as well as supplying fruits and bottles, is highly relevant to our customers.
Despite our growing revenues of our fresh juice system segment, we are nevertheless not satisfied with the sales development of the machines. The juicers remain the strategic core focus of the overall development. They remain the key driver also for the sales development of fruits and bottles. As the sales of juicers in the first six months of this year were largely stable at the level of last year, also because many retailers in a high inflation period secure their cash positions and reduce their investments, we need to intensify our commercial efforts, especially in one of our core markets, Germany. Therefore, we will also undertake changes in the German sales structure in the upcoming months to strengthen our capabilities. Let me briefly summarize the journey of our business and performance in the first half of the year.
Business has developed as we predicted and expected. We were able to increase consolidated revenues significantly, but massively higher costs have fully arrived and unfold their full year effect in 2023. This had a dampening effect on our earnings figures. Extensive price increases we pushed through have been showing their first positive effects during the second quarter. Our main objectives remain over proportional growth of our high-margin strategic core topics, as well as further price increases at the beginning of 2024 to regain margin quality. I would like to hand over to my colleague, Ralf Brühöfner, now. He will provide you with more detailed information regarding our main financial KPIs.
Thank you, Oliver, good morning all together, also from my side. In the following, I would like to explain how our cash flow, our debt situation, and our return on investment have developed in the first half of 2023. At the end of my explanations, you will have understood that these key figures for the first half of 2023 were characterized by recurring seasonal effects on the one hand, but also by special influences on the other hand. You will also see that the Berentzen-Gruppe has an unchanged high level of financial stability, solidity, and good solvency. Having said that, please have a look on slide 17 of the presentation. As you can see here, free cash flow, as of H1 2023, was negative at minus EUR 19.7 million.
The first half of the previous year, this KPI was also negative, but the extent was EUR 7.9 million lower. What are the reasons for this development? This was not due to the operating cash flow, as that was again positive at EUR 4.3 million, and then so far is sufficient to finance the payments for investments and assets of EUR 3.6 million. The fact that it was around EUR 1.7 million lower than in the previous year was the result of a slightly lower EBIT of EUR 1 million, higher interest expenses due to higher interest rates and higher credit utilizations, and of higher outpayments for taxes. It was mainly trade working capital effects that led to a total cash drain of around EUR 20 million. Three issues are relevant in this context.
First, usual volatilities as of the reporting date, which varies from year to year, depending on different payment and settlement dates of whatsoever short-term liabilities. I would neglect this aspect here. Rather, it is more important to look at, second, the recurring seasonal effects, and third, the fundamentally higher investment effect, which was particularly priced but also growth related, and thus had a negative impact on Free cash flow. The magnitude of the recurring seasonal effects is immense. Free cash flow in the second half of the year was always clearly positive and amounted to an average of around EUR 13.6 million in recent years. Thus, we expect a significant recovery in Free cash flow in the second half of this year as well. Higher material prices and higher revenues have led to a massive investment in trade working capital since the end of 2021.
It increased by EUR 23.5 million compared to the end of 2021, and by EUR 8.3 million compared to the end of June last year. Let's go into details. First of all, we have the seasonally lower financing effects from the deferred payment of alcohol tax in the amount of EUR 6 million-EUR 7 million. You can understand this by looking at the blue part of the pillars. At years end 2021 and 2022, the financing effect of the alcohol tax is always higher, being EUR 36 million-EUR 37 million. In the years before, it was more than EUR 40 million. This basically depends on the level of gross turnover in those seasons.
This is the most important issue, massive increases in purchase prices have permanently driven up the inventories by almost EUR 15 million, from EUR 39 million to EUR 53.8 million. In addition, revenue growth in those segments whose receivables are mostly not included in the group's factoring program, has increased the value of trade receivables by EUR 4 million between the end of 2021 and the first half of 2023. All these investments had an impact on free cash flow in 2022 and in the first half year of 2023. However, in my opinion, the peak of this development is reached, which means that such massive additional investments in trade working capital are not likely. All these factors mentioned before have, of course, an impact on the net debt, as you can see on slide 19.
Starting from a net cash situation at the end of 2022, the net debt at the end of the first half of 2023 amounts to EUR 12.9 million. I have already explained most of the cash movements shown here. I also have explained that we expect a seasonal recovery in the second half-year. By the way, the item cash flow from financing activities includes mainly the dividend payment for the financial year 2022, paid out in May 2023. It will be covered by the operating cash flow generated in 12 months, 2023. The fact that the Berentzen-Gruppe remains stable and solidly financed is shown by the debt leverage on slide 20. Having a LTM EBITDA of EUR 16.1 million, the leverage is only 0.8. As a result of trade working capital investments, capital employed also increased.
In view of a LTM EBIT of EUR 7.9 million, a level that we have also shown in 2022, ROCE decreased from 9% to now 7.5%. Nevertheless, our ROCE is higher than our weighted average cost of capital, and it is, compared to other companies of our size and our business, such as Schloss Wachenheim, Lucas Bols or Marie Brizard, near the average. As we permanently strive to be better than the average, we are only lightly satisfied with it. This leads me to my pre-final chart, in which I will summarize what has been said. Basically, operative cash flow are sufficient to cover CapEx and dividends. Price inflation effects have led to a massive increase of trade working capital items, mainly stocks, with effects on free cash flow, net debt and at least on ROCE.
The investment peak with regard to stock value seems to be reached. With the aim of being able to finance growth on the one hand, and to optimize the capital employed and thus ROCE on the other hand, we successfully implemented two measures in the last half of the year. First, increase of bank facilities from EUR 33 million to now EUR 42.9 million. Second, intensified working capital management. This has already led to a lower stock value of about EUR 4 million. It was a hopefully good to understand view on our actual cash flow, ROCE and financing situation. Let's move on with the outlook for the upcoming months. As Oliver already said, our half year results were totally in line with our expectations.
Taking this into consideration, we today reconfirm our full year guidance, which we published in our 2022 annual report at the end of March 2023. We expect significantly increased revenues coming from EUR 174.2 million in 2022, and being EUR 185 million-EUR 195 million in 2023. Every business segment will continue its revenue growth in 2023, of course, to a different extent, and will therefore contribute to the positive growth dynamic. With regard to our bottom line, we forecast consolidated EBIT of between EUR 7 million and EUR 9 million, and consolidated EBITDA of between EUR 15.6 million and EUR 17.6 million. Accordingly, we expect our earnings figures at roughly the same level as the previous year, due to the challenges that Oliver has already presented in detail. That's it from my side. Now we are happy to receive your questions.
Thank you, Ralf and Oliver, for your presentation. I will take a look at the chat, but there are no questions so far. Now you have, once again, the opportunity to ask your questions via the chat window. Okay, one question: You said in your introduction that retailers are asking for price reductions, Oliver.
Yes.
How will the pricing situation go on?
Of course, this is part of the Well, this is always part of the game between industry and retailers. Retailers are very short-termly looking at certain price levels, which has come down a little. Of course, we don't look at the price levels which go down in the last four weeks. We have to compare the price, the overall price levels between the pre-war situation of 2021. Compared to 2021, we are still on a significantly higher cost level today versus 2021. We, of course, react to the price reduction demand. We, of course, are going to avoid it. We argue with a lot of figures we have and analysis we have, that there's no reason for price reduction, just the opposite.
Because when we say that we forwarded the, the price or the raw cost or material cost increases, we still have to cover this year's increases, cost increases for personnel, for example. So, this is a normal situation with, with, with retailers. We will have tough discussions, but of course, the aim remains that we have further price increases, which we announce being effective for the beginning of next year.
Okay, one more question: Sorry, how flexible are you in marketing costs and other costs?
Yeah. Generally, of course, we have always the opportunity to maneuver with our costs when it comes to investments into commercial parts, investment into marketing. Of course, it's not our aim to always cover our profitability by cutting down investments into our brands, like marketing, promotional activities, and so on. Our target is, of course, to have a sufficient investment into our marketing activities, commercial activities. Because one thing is very clear, we need to over-proportionally grow with our strategic core topics, what we also reported for the first half of the year. Of course, we want to continue in the second half of the year.
Okay. Do you feel that the low point in the EBIT margin has been made and that the upward trend is now continue?
I mean, of course, we, we showed in our chart that the EBIT margin in the first quarter versus the second quarter was already a difference between 250 basis points. Of course, there are also seasonal effects from quarter to quarter. Anyhow, as I said before, is that the price increases we put in place was, of course, announced for the beginning of 2023. Of course, the negotiation period with retailers really last partly long and until April, and even further. That means that the price increase effects, which we see in the first half of the year, should be lower than the price increase effect we have the second half of the year. And also, as you know, is that the strongest quarter we always have is the fourth quarter of the year.
Of course, we do believe, and we are very convinced that EBIT margins will rise again and rise further in the next quarters.
Okay, the next questions are on Citrocasa. Even though you extended the product range with your pomegranate deseeder, we see a decline in quantity sold. Can you shed some light into this?
Mm-hmm.
Do you have maybe any current figures of the main competitors, Zumo and Zumex, to compare? Moreover.
Mm-hmm
Do you see any substantial structural changes in the market? How is your plan to reactivate the volume growth in sales? You mentioned changes within the sales teams.
Mm-hmm.
What do you mean by that?
Okay. First of all, as I said, in my part, is we are of course, not satisfied, because machines is the core of the business. Of course, we benefit compared to competitors from our one-stop-shop system, where we also deliver fruits and, and bottles, and we do it successfully. Of course, the machines remain the core business. In the first half of the year, we have seen a lot of light and shadow. There are markets are growing double-digit, and there are markets who fell down. Especially we are not happy with the German market, as I said before. The German market is behind expectations, the German market is also behind last year, which overall, led to an overall, let's say, largely stable, sales versus last year.
We unfortunately do not have figures from Zumex and Zumo. There is no market research institute really covering these kind of sales. That is, we have, we have no insights on this, what their very recent development is. We see, of course, current challenges on two things. Number one, also the retailers are a little bit reluctant to have heavy investments. Number two, the retailers have, of course. The biggest issue on the retailers is finding people, other staff, and also the cost of staff. Of course, in such a machine, you need staff to operate these kind of machines on the store floor. These are the little bit the limits currently.
Nevertheless, we are still very convinced that these machines is a very, very good offer to retailers to increase their margin structure, especially in fruit juices and so on. What I said about Germany is something which we are now about to change in the German structure. The sales team in Germany was more a field force. These were people who travel from shop to shop to shop to sell a single machine. We believe now that it's much more important to manage key accounts.
To, to go to the central purchasing departments of big players, so we need to change our profile of the of our people from, let's say, field force, more to key account management, and this is a change we are currently undergoing.
Okay, one question to the non-alcoholic beverages. Regarding your KPI contribution margin after marketing budgets, you reduced the full year guidance. Please explain the main driver for that decision.
Yeah. This is because of the, the, the ongoing business, which means that we were very cold summer in the regions where we had the sales for water. We're talking about regional water and the sales volume, and of course, the turnover. Within the contribution margin, therefore, is slightly reduced, and this only depends on the water business, the mineral water business so far. Of course, the HoReCa, the gastro business for our franchise brand, which is Sinalco. You know, that the HoReCa business in these days is very under pressure, this is another reason that we re-reduce this contribution margin after marketing budget. It is not because of Mio Mio. Mio Mio is expected to be in growth again, but it's because all of the other items we have.
Now that energy prices are lower, what are you doing to counter future volatility in energy prices?
In, in which prices?
Energy.
Energy prices.
Yeah.
I mean, yes, energy prices are much lower than last year, but they are still strongly ahead of 2021, as you know, even in our company. This year, we changed the way to purchase energy. We are currently purchasing daily on the stock market, which in this year helped us a lot to also reduce our energy costs. Of course, what we also did was investing into photovoltaic and so on. The efficiency, how to use energy, and the sources of energy has been slightly changed, and we will have further investments to invest in renewable energy. The big question we currently have, and which we cannot answer, is: how do we purchase energy next year?
We still cannot clearly say if it's better to continue with the model of daily stock market purchase, or if we can go back to a full year contract or even a hybrid model, model, where we, the part of the energy need we have, have a fixed contract, and the rest is more like floating. This one, we don't know yet. In general, we do think that the energy price we see today and the, and the, let's say, good news for this year compared to last year, will continue for next year.
Okay. One question about our P&L positions. Other operating expenses went up for EUR 1.2 million. What do you summarize in this position? Other operating income increased by approximately EUR 1.5 million. In the report, you justify the effect due to accruals and issues which are not related to the accounting period. If you combine the effect from both, they together stand for only half of the change. Where did the other half come from?
Yeah, it's a very analytical, analytical question, of course, concerning all the other items, but they are welcome. Perhaps the other operating expenses, I think there was a question about this EUR 1.2 million. I think the growth or the deviation in comparison to last half year was mainly due to a, yeah, fund. What is this funding-
Deposit.
You know, the return.
Deposit, return deposit
Deposit for our return of bottles. On the one hand, this is about EUR 500,000, and the other main issue or main item which comes out from this deviation is all these things around depreciation, depreciation on stocks. You know that at a stock level of about I've shown to you, there is something about EUR 50 million. You have always depreciation, depreciations on stocks. This was a little bit more, not only a little bit more, much more than in the previous year, and this is the other this is the other figure which causes this deviation. So it's EUR 500,000 for depreciations and EUR 500,000 yearly for-
For this deposit for returnable bottles. With regard to the other revenues, mainly this is, this is everything which is not strongly business or, or, or, turnover related, let me say it in that way. Mainly we, we book all this into account, which comes from our, our budgets for our customers. Yeah, you know that we have some negotiations concerning all these discounts and so on. And at years end, we have an expectation, an valuation of what it should be, and sometimes you have a little bit of other earnings, sometimes you have a little bit of other expenses at the time when all this negotiation take place again, and we have to deduct or increase all these amounts.
That's the main, main reason for that. There are some of other items, of course. You know, in half year we have, we have a lot of items in this, other, other revenues. Something like, yeah, revenues coming out of the usage of our of our car policy, and so on, and so on. Many items, it's hard to explain here, but the main deviation, comparison to last year came out of this issue, from the negotiation with our customers.
Okay. Do you cover meanwhile with Mio Mio, all regions in Germany? What growth-
Yeah
Potential do you see with Mio Mio?
Yeah, I mean, we always said that with the implementation of our sale of our own sales force, which started mid of 2020, this team is already about 30 people big, which is we're very happy about this and the effect they have. The main effect on this field force was, of course, increase of distribution levels, also mainly in Southern Germany. three years ago, there was a huge difference between Northern part of Germany and their distribution level and Southern part. This gap is getting closer and closer. I think three years we were about 25% weighted distribution of Mio Mio in Southern Germany. We are now reached more than 60%. So there is a strong, strong increase in distribution levels we currently see, and this can even go further.
It's not only the distribution level of Mio Mio itself, it's also the variety of the portfolio. We have, in the meantime, I think, 11 flavors of Mio Mio, and of course, you know, one have only two flavors, the other has eight flavors, others have 10. So we see two effects, which will also drive growth in future. Number one, there is a higher demand on the consumer level, so the consumers are. We are winning more and more consumers every day, and they stay with us. Number two, the overall distribution level will further increase in Northern and Southern Germany, but mainly Southern Germany. Number three is that the range of the portfolio, which is presented in the shelves, will also increase.
I see, we see, for the next years to come, also every year, double-digit growth easily.
Okay, thank you. There are no more questions right now.
Yeah, there's one.
Oh, okay. Could you provide an update on your current ESG actions? Concretes on the stellar position in that regard.
Yeah, of course. We give, give the next update during the I, I think we have published our ESG report in the end of May. This was the latest update what we published there. Considering that, we are just just aiming just to identify new issues with regard to to decarbonization effects and with regard to further lower the emission of the company. You know, we have a three year strategy on our ESG items, and so therefore, we will this will be the first year where this three year strategy will fulfill the targets for the year of 2023. This is mainly personal related or with regard to HR, you can have a look, of course, in our ESG report with considering that.
Yeah, the next, the next stage is just all to fulfill, and all our strength now is to fulfill the aims we had for 2023. Next steps is 2024, next steps is 2025, and now we are looking further, above, or beyond 2025. There will be a strategy, which we publish next year for the years behind 2025. This will be the next step. Nowadays, we're just looking on our 2023 targets so far.
Okay.
Of course, we have, we have a lot of, really a lot to do with all these regulation items. Last word, on this issue, I think, there, there's a lot to do for our, yeah, our core member of the, of the team, ESG, with all this regulation, it's called Lieferkettensorgfaltspflichtengesetz, CSRD, you have read about that. The, the main work, in these days is, is about.
Fulfill
To fulfill all the regulations and to fulfill all the things we get from our customers. You know, that they are just bind it in this construct of Lieferkettensorgfaltspflichtengesetz. There's something like Niedergelassene and so on. The big suppliers are demanding us just to fulfill all their, all their needs. This is a lot to do, and we are prepared to do that. We are very well prepared, as you see, with this positioning in these days. A lot to do with the regulatory items instead of pushing forward the things of itself. It's a little bit angry about that, I think every company is concerned about that and is doing it in these days.
All right. Once again, no more questions. We have reached the end for today. Thanks again, Oliver and Ralf.
Thank you.
Ladies and gentlemen, thank you all for your participation and your ongoing interest in the Berentzen-Gruppe AG. If you have any questions afterwards, please do not hesitate to contact us. You will find the contact details in the IR section of our corporate website. We hope to see you soon again. That's it for today. Have a nice day. Bye bye.
Thank you. Bye.
Thank you. Bye.