Earnings Call: Q1 2021

May 4, 2021

Welcome, everyone, to our Q1 earnings call. Today, I'd like to quickly refresh your memory on our vision and mission for the company before covering the highlights of the Q1 and then handing over to Christian for our financials and our updated guidance. Company. It was less than 10 years ago when we actually started HelloFresh from a blank sheet of paper. Shortly thereafter, we sat down with by then, I think it was a 5 person team and articulated what our mission should be. Company. It says we change the way people eat forever. And what we mean by that is that we offer our consumers an affordable, home convenient and delicious way to cook the best meals at home and hence fundamentally changing the home cooking experience. 7 of 10 dinners globally and 5 in 10 dinners in the U. S. Cook and consumed at home. This is one of the largest consumer spend categories and at the same time a category that vaccine, very little innovation and disruption in the last couple of decades, and that's what we're here to change. Company. In our Capital Markets Day in December, we also outlined our vision for the group, which is to evolve from a leading meal kit company to a fully integrated food solutions group. Already today, you can see our broad suite of product offerings to consumers. We are not only the undisputed market leader in meal kits, quarter, but have also added innovative new meal kit brands like Green Chef and EveryPlates to our roster. We have very successfully expanded experience to Ready Meals with the acquisition of Factor, and we've made first forays into online grocery by scaling up our HelloFresh marketplace in Benelux. So from a portfolio perspective, I think as of today, we already touch a lot of the different buckets of a consumer's food budget, and we will increasingly continue to do so going forward. Quarter. Over the course of the year, we should get to close to €1,000,000,000 in cash on our balance sheet, and I can promise you that we will continue to focus company on making our value proposition to consumers better and better over time. With more meals on the menu, better service levels, more competitive pricing, we will go after the huge home cooking TAM while adding many more exciting products to our offering and hence allowing us to capture a larger part of our consumers' food budget. With that quick refresher, let's turn to the near past and actually focus on what happened in the recent Q1 of 2021. First of all, quarter. We continued with our impressive customer growth rates. We added sequentially about 1,000,000 customers, both in the U. S. And in international to 7,300,000 customers from 5,300,000 customers in Q4 2020. Most of that was driven by unlocking new capacity in our current. Secondly, we also saw a beneficial impact from the ongoing pandemic with both order rates and AOV up year on year, but slightly down sequentially, very much in line with our projections that we gave on the Capital Markets Day in December. Quarter. Q1 also marks the highest ever net revenue quarter, amounting to 1.44 €1,000,000,000 in a single quarter. With €159,000,000 in adjusted EBITDA, quarter. That's an 11% EBITDA margin. This was also among our most successful quarters ever and outperforming some of our internal plans. Cochrane site, 2 in the U. S. And 2 in international, more specifically in the Netherlands and in the UK. We also saw our recent acquisition, Factor 75, doing very well in the Q1. Our synergy plans came to life, and we managed to scale the business quite successfully and continue to see good momentum, quarter, which gives us a lot of conviction that we're able to execute M and A deals very successfully. Gasoline. Finally, given the positive trading year to date as well as the robust outlook across core markets and all future growth initiatives that will be landing over the course of this year. We have upgraded our guidance and now expect revenue growth between 35% 45% for 2021. Quarter. Now focusing on customer growth. Q1 is typically the seasonally most favorable period of the year for us. With customers staying home, the weather usually not that great in large parts of the Northern Hemisphere, and hence, that's where we usually focus our marketing initiatives quarter disproportionately over the course of the year. This has paid off quite a bit. So customer counts has gone up by about 74% year over year from 4,200,000 customers same period last year quarter to 7,300,000 customers in the Q1 of 2021. That's not only very strong year on year growth quarter, but also very strong sequential growth because we added both in the U. S. As well as in international about 1,000,000 households. And so sequentially, we grew by about 2,000,000 from 5,300,000 to 7,300,000 customers. This also sets us on a very strong trajectory for the remainder of the year. So as we go into the Q2, the Q3 and the Q4. We also expect very robust year on year growth given the customer base that we have now attracted and that continues to order growth high rates. Order rates quarter have been up by about 14% year over year from 3.5 orders to now about 4 orders. Quarter that is slightly less than what we have seen in the Q4 and can be explained by the fact that, number 1, markets have been opening up post pandemic in large parts of our geographies and secondly, that we also had an influx of new customers. If you think about customers on average joining about halfway through the quarter. That is also something that somewhat drives account, the average number of order that every customer can get in a given quarter. It's still meaningfully above pre pandemic levels cost of, and we expect over the course of the year, it will stabilize or slightly go down from the level that we've seen right now. But the exact and the right way to look at it is always on year over year numbers rather than sequentially because there is some seasonality in our business. On AOV, we also increased AOV year over year by about 4%. At the height of the pandemic, we had average order values quarter up by about 10% to 12%. So you can see that it has been slightly coming down. Again, this is quarter, partly due to the fact that we've actually increased and brought in a lot of new customers over the course Q3. New customers usually come with price incentives. Nonetheless, if you look at it compared CO2 pre pandemic, you can see that baskets have remained larger and that also we have growth benefited from actually broadening our product portfolio and customers attaching more and more products to their order. So not only meal kits, but also from the suite of products that we offer most prominently in the Benelux and our HelloFresh market. But also in other geographies, our offering has just become quite a bit larger, and that is reflected in higher AOVs compared to pre pandemic levels. Quarter. Now if you put all of these three things together, very strong customer growth, high continued high order rates, quarter, better AOV than pre pandemic levels. You can see how we've also achieved the best ever revenue quarter of the company quarter because we've grown revenue from about €700,000,000 last year all the way to €1,440,000,000 in the first quarter of 2021. That's a 116% increase in constant currency quarter and something that I believe is really a testament to the fact how much consumers love the product and how well we actually hit the nerve of consumers. Key drivers have been, as I just reiterated, the strong customer growth supported by ongoing high order rates and AOV. With that, I'd like to hand over to Christian the contribution margin. Our contribution margin is down year on year by around about 60 basis points to 28 This is a result of a number of partly offsetting quarter. On the one side, we saw an improvement in procurement expenses as a percentage of revenues by 0 point quarter by 1.2%. Now why is that? It's been driven by a number of factors. Number 1, as Dominik had alluded to in his intro, company. We ramped up multiple new fulfillment centers during that quarter, both in the U. S. As well as in international. Secondly, quarter. In our U. S. Business in February, we saw meaningful weather disruptions. 2 out of those 4 weeks in February were impacted by heavy snowstorms, and that somewhat impacted also our production expenses in those weeks. And then thirdly, given that we've added a lot of new customers through our service in Q1 and new customers typically come with a certain level of price incentives that we offer that has a certain impact on margins as well. And looking forward into Q2, you should assume that contribution margin as we Continue to ramp up new fulfillment centers and also on the packaging side, basically, if when the weather gets It's warmer, also have a certain increase in our packaging costs. You should assume the contribution margin for Q2 broadly stable to slightly up versus what you've seen from us in Q1. And that also means from a year on year perspective quarter versus Q2. Last year contribution margin should be meaningfully higher, given that Q2 quarter. The contribution margin level, meaningfully by COVID effect. Let me turn now Q1 of 2019. Our marketing expenses as a percentage of revenue are lower by 1 point core 17%. And we managed to end up there at the low end despite us adding 2,000,000 customers sequentially in this quarter. Company. We've achieved this because customer acquisition costs are still at attractive levels and give us very strong ROI on that marketing clients. And on top of that, we still see high order rates and strong retention by our existing customers. And existing customers obviously generate revenues and profits without us having to target them through marketing the. With that, let's have a look at our EBITDA. Despite us ramping up 4 new fulfillment centers, despite us meaningfully expanding our customer base, actually the biggest sequential expansion that we ever delivered is what we've delivered in Q1 and despite us spending new adjacent the absolute EBITDA in that quarter. This industry leading profitability is very broad based, which you Q1. When you look at the profitability of our 2 segments, both segments delivered double digit EBITDA margins with our U. S. Segment with a margin of 11 Q1.5% and our international segment with 13.3%. So that's a summary of our P and L in Q1. Quarter. Let me now switch gears a little bit and talk about our cash flows. In Q1, we We achieved again very strong cash flow from operations of €209,000,000 This is driven quarter. I'm very strong profitability, so the €159,000,000 EBITDA that we just looked at. And on top of that, given the strong sequential growth that we have delivered in Q1, we also saw meaningful cash inflow from working capital close to €100,000,000 in that Q1. Let's also talk about our investment cash Cone. We've deployed CHF 27,000,000 in CapEx in that first quarter. That's a number that you should expect to continue to rise over the coming three quarters. Given that our growth is now even stronger than we initially anticipated, we also want to bring forward certain investment projects. That means we're planning now for 2021 with CapEx of €200,000,000 instead of the €150,000,000 we had initially guided core for this year. To also talk about our cash flow from financing, this quarter. It comprises primarily 2 parts. One is the, let's say, business as usual amortization payments of our financial leases, around about SEK 7,000,000 in the quarter. On top of that, this also includes SEK 39,000,000 cash payments for the settlement of share based compensation. Now for share based compensation, we have the choice to settle those either in shares or in cash. Given that this time, at the time when those share based compensation became due, our share price was in the low 60s. We decided it was better value for our shareholders to settle actually this in cash quarter rather than creating dilution at that share price level for our shareholders. But in sum, if you put all of this together, CHF, around about CHF 150,000,000 alone in this Q1 of 2021. Quarter. Let me conclude now by repeating our guidance for the full year 2021, which we had increased on fiscal 2015. We've increased our constant currency revenue guidance for the year from previously the 20% to 25% to now 35% to 45%. All that I had said previously with respect Q2, our expected average order value for the full year being between €48,000 €49, and our average order rates on a quarterly basis to be between 3.7% and 3.8% for the full year. That still holds true. So no changes to what we discussed at our Capital Markets Day. Same applies to that we still expect customers to revert back to a normal seasonality pattern this year, I. E, lower order rates, lower customer acquisition activity from late June through end of August. So no changes to that. But given the strong increase in our customer base, which we've Given the decent EBITDA performance that we've delivered in Q1, we also decided to narrow our EBITDA quarter. Our margin guidance from previously 9% to 12% to now 10% to 12%. With that, we look call the the The first question is from Shiketa Kia, Morgan Stanley. Your line is now open. Please go ahead. Great. Good morning, everyone. Three questions in the quarter and going into second half and perhaps even into next year, are you assuming overall retention will remain above pre COVID levels? 2nd, on the different geographies, can you share with us what are some of the fastest growing markets at the moment? And are there any remaining capacity issues across your markets? And lastly, on Factor, now that you've had a few months with Factor, how have your expectations for the Prepared Meal segment How big of an opportunity do you think it can be? Would you seek to do similar acquisitions in international? And lastly, can you share whether Factor Okay. Thanks, Raquel. Let me take your first cost of question. So on active customers and share of reactivation, reactivations We're roundabout in the mid-20s, low to mid-20s across the group, yes? So somewhat In terms of growth differential between our geos, That growth that we've experienced also in Q1 is really very broad based. So in substantially each of our markets, you We've seen very strong year on year growth. With respect to capacity, I would say the overall situation is much It's better than what we had experienced during last part of 2020. Having said that, there were definite there were still a couple of markets where We had to actively steer demand, especially in the first half Of Q1, Germany, for example, is one example where we added throughout the quarter further production lines. So there, at least until end of February, we still quarter. Yes, to be fair, I think that also applies in large parts to the U. S, not that we were trading at 100% capacity utilization but very close to it. And so certainly, like not as much an issue as the etcetera that we're holding back on. And with regards to factor, I think overall, it's very it's been very good. It's been very strong. The teams have been working together very closely. We have seen a lot of synergies come to life. We've seen a very strong growth momentum in the Q1. I think it underscores our ability to do M and A and then also very quickly leverage our growth playbook. I think the team and the team's motivation has been great, but really bringing a lot of the sort of like growth playbook that we like and that we have played in the last couple of years is something that we have certainly seen can drive a very big difference in a short amount of time. So if you think as of today, our smaller brands, Factor, current EveryPlate, Green Chef. I think each of those brands is on track to become a very large car. And to be fair, in private markets, I think each of those brands would probably be valued at much, much higher multiples than as part of the group at the moment. Great. Thank you. The next question is from Fabienne Carmont, Kepler. Three quick questions from my side. The first one regarding your It was higher in the U. S. And in international. Does it mean that you're using more price incentive strategy for the international part closure business? And this is the way to look at it for the remaining part of the year. 2nd questions would be, can you remind us how the add ons are working in your new countries, how consumer reacting to that as well how consumer reacting to your grocery offering in the Benelux? And finally, So in terms of marketing spend, I think over the whole of Q1. We saw overall a pretty good environment. Customer acquisition costs have comeback to levels that we've seen towards the end of 2019 and the beginning of 2020, so pre pandemic levels. Call. But at the same time, that means that it's still extremely attractive to us. So for every marketing dollar that we spend, we actually make that back chair unheard of. If you think of U. S. Versus international, then I think in the U. S, we basically opened up 2 new facilities. And with those 2 new facilities, we actually also wanted to scale them up and get them to a certain scale to operate international. And we've also seen that, obviously, pent up demand has been quite strong in the U. S. So I think that's sort of like a little bit the story on marketing, we were quite happy with what we've seen, and we think that question. We have continued to so first of all, there is our normal add on store, which we have in literally every market. And then there is the advanced version, our HelloFresh marketplace, which we have in Benelux. So in Benelux, we have continued to add more products to our HelloFresh marketplace. It now stands at close to 150 products. Catch rates from consumers. And we actually have seen a beneficial impact both on AOV as well as on the average profits that we clipped per order. And for the remainder of the year, we will certainly continue to add more products to it cohort and then observe and monitor how these relationships hold true. The more products we add, the more attach rates the higher baskets we get. We will be monitoring that closely. And at the same time, we will also start rolling out our HelloFresh marketplace in some of the other countries. In most of our other countries, right now, we have about 25 products on offer, and we'll scale that up in a number of other markets to over 100 products over the course of this year, which puts us on a very good trajectory CRE to scale it up further in the outer years and really sort of like eat into consumers' food budget, capture a larger part consumers' food budget over time. And Fabienne, on your third question, the wage inflation Question. So there is a certain element of that as the economies come back, including the U. S, We also see a certain effect in our direct labor wages, but all of that is priced into the margin guidance that we've put out. Okay. Thanks a lot. The next question is from Robert Burke, Berenberg. Your line is now open. Please go ahead. Yes. Hi, everyone. Three questions, if I can. The first is perhaps a little tedious, but you mentioned many of your markets have started reopening. Can you just give us some examples of what you've seen still in Australia, New Zealand, regions of the U. S, those that are perhaps more open than others, both in terms of the customer growth in Q1, but also perhaps more interestingly, the order frequency and the basket size there? The second question on Green Chef, you launched recently in the U. K, interested to know what appealed to you about the U. K. And I assume it's too early to say how it's going, but maybe some comments on your interest. Anything any color you could give there? And maybe quarter? Remind us how many countries you expect to add either Green Chef or EveryPlates in 2021. Quarter this year, how should we be thinking about the seasonality of margin through 2021? Thanks. Call. So what appealed to us, U. K. Is, I think, a very developed market. It's a market where we also have different competitors, where we have bid out our menu quite strongly over the last couple of years. So U. K. Customers have in the HelloFresh trend amongst the largest choice already. And we think that sort of like to expand TAM further in the U. K, quarter. There was sort of like a strong desire in the markets that we've seen in customer research for also more premium offerings for more specialty diet. And so we felt very well equipped in terms of our resourcing, in terms of our fulfillment center infrastructure, the state of automation in our manufacturing sites that we can deliver a great product to consumers. And that's why we Pict U. K. As the 1st market for Green Chef to internationalize. With regards to every place, we have that live in the U. S, we have Fed Life in Canada, and we have Fed Life in Australia. So that already covers sort of like around 70% or 75% our sort of like geographic coverage. So in every place, we're a step further. And over the remainder of the year, we'll see if we further internationalize it. There are certainly more country launches coming. But yes, as you said, in terms of performance, it's very early. We Q1 launch that I think 2 or 3 weeks ago. And hence, I think we're in the phase. We're really trying to customer market where we're looking very closely at customer feedback if the type of meals, the advertising, the messaging thing resonates with customers. And as we see proof points for that, we're then also willing to scale it up. Markets Day, which is that Australia and New Zealand have obviously returned to normalcy quite a while ago. And here, we can see them going back to sort of like normal seasonal patterns. So in summertime, slightly lower order rates and lower AOB as we've come out of the pandemic stabilizing nicely, I think very much in line with actions that we had, which is no surprise to me because we have a 20 person demand forecasting team that looks at customer level data and is usually very good at making accurate predictions. And so we can only underline what we said during the Capital Markets Day that there haven't been any surprises. Same for the U. S. We want refrain from giving like a state by state data. But certainly, in the U. S, I would say about half of the country has been wide open. And if you look at our Q1 numbers. I think you can be very bullish on the future outlook. I think overall, customers having switched to buying more online over the course of the pandemic, have seen that there are clear advantages in not using an online grocery service, but using a full meal solution like HelloFresh and that you can see in continued very robust order rates. And we don't see like huge differences between the states that that have opened a little more up and the ones that are more close. And then Rob, on your question on margin seasonality, if you, contribution margin perspective, our weakest quarter is Q3. So Q3 peak holiday season in most of our markets, I. E. Lower order rates the During the quarter, we still obviously have the same fixed cost base and that's the key impact to our contribution margin somewhat. Also, our highest temperature most of our markets, I. E, more insulation materials and higher packaging costs during the quarter. So Q3 typically from a contribution margin perspective, the softest quarter and similar on the EBITDA margin. So that falls through to the EBITDA margin as well. And on top of that, quarter. In terms of our marketing invest in September, we dialed that up meaningfully in the back to school period in most of our markets where the benefit of that quarter. This year, Q2, similarly healthy margins to what you've seen from us now in Q1. Q3, you should consumer margins are seasonally somewhat lower and then Q4 basically back up again. Perfect. Thank you. The next question is from Mifel Neisser, Deutsche Bank. Your line is now open. Please go Great. Thank you. I have three questions as well. Firstly, on the guidance for 2021, I'm just trying to understand what Your thinking is in terms of what needs to happen for you to hit the upper end of the range and what sort of incorporated in the lower end of the range when it comes to revenue growth? And how we should think of the next three quarters of the year in terms of customer additions given in my calculations to even hit the upper We're likely to see the customer base sort of decline over the next couple of quarters. Is that the right assumption given the seasonality you're incorporating? Some color there would be great. My second question is on the capacity expansion. Could you remind us again How much of incremental revenue capacity did you add in the U. S. With the 2 new sites that you opened? And how much more Can we expect over the rest of the year, if I'm not mistaken, there's one other facility coming up in the U. S? Any color some color That would be great. And my third question is on current trading as well. If you look at consensus, there's a 30% plus sort of growth assumed for Q2, which is still, I guess, great given the comp from last year. But is that still too conservative in your view, some color there would also be great. Thank you. Okay, great. Maybe, Nisla, I'll take your first and your third question together. So quarter. What defines the 2 bookends of our guidance? I would say the upper half the underlying trends as we do right now with the normal seasonality baked in. And then the lower end, it takes a couple of sensitivities around seasonality potentially being a bit more pronounced than or somewhat more pronounced than what we would consider, let's say, completely business as consumer environment. So that's ballpark what defines the 2 bookends of our guidance. What does that mean for our customer development. So into Q2, you should assume our customer number to be broadly at the current level, potentially even touch up from where we sit right now. Q3 then, as As we dial back on new customer acquisitions typically for at least 2 months out of the 3 months in Q3, you could see that going down a little bit and then up in Q4. That's going to be the seasonal pattern that we foresee on our customer development. Quarter. So what does it mean in terms of quarterly revenue development for Q3. You should assume down versus current levels because of lower order rates, as we had discussed before, from a From a seasonal perspective. In terms of your question on capacity expansion, We had outlined at our Capital Markets Day that we effectively wanted to versus Q3 last year as a baseline. We wanted to group. Substantially double that capacity by Q1 2022. And we are by now We are well on track towards that goal. And I would say, from a capacity perspective, between onethree Q2. That's the end of the Q2. And then there's another side going live by the end of the year. And also in international, Australia, Canada, other geographies, we have a number of new fulfillment centers, which are still going to come on stream between now and Q1 C22. Great. Thank you. The next question is from Markus the Also three questions from my side. I mean, but the first one maybe on Again, could you maybe tell us a bit more how you yes, what the experience is so far, but how you sell it? I mean, I. E, Yes. Is it all incremental? Or are consumers choosing 2 meal kits and just one ready made meal? That That would be quite helpful. I assume retention is improving, the factors included, but that would be quite helpful. The second question is Yes. On something I asked before is the question, how much of your customers, both new customers and activations actually pay the original price, yes? And I know you don't disclose this, but if you could maybe help us a little bit to understand, is that actually a relevant question? Is That's something to think about? Or do you think running on a longer term base on discounts is actually okay for the business, yes? So that would be It's quite interesting just to see where the levels of discount boxes actually are in the mix. And then the third question, If you can just update us again on new markets, where are we in terms of launches, what new markets can we expect in the next 2, 3 quarters for launch. Norway, Italy, and you said last time, I think, Japan takes a bit, but just an update, what we can see as incremental markets throughout the year, it would be helpful. Markus, let me try to tackle earlier questions. Going back to Factor, I think the logic behind the acquisition was to expand our TAM because if you look at the customer base that Factor has, we can see that they over indexed on singles, that they over indexed Mayo and that they over indexed on using the products for lunch rather than for dinner. That's what we really liked about it. Quarter. Right now, we only sell it as a stand alone product, meaning you need to subscribe to Factor. You cannot use your HelloFresh account to actually subscribe with Factor. You need to register from scratch. We course. So don't sell any of the factory meals into our HelloFresh customer base. That's something that we think is very promising, but which we will only be able Q2 potentially next year. At the moment, we've been laser focused in improving the underlying fundamentals of the business of Factor car and hence allowing it to scale very efficiently and at great customer acquisition costs. Again, if you think about the broader context, expanding TAM and then kind of like how big is the ready to eat space, then I'm I'm very convinced that number 1, in the private markets, I think with the growth momentum, etcetera, that we're seeing, it would already be valued at very, very, very much higher valuation than what we paid for it in a couple couple of months ago. And secondly, that there is a lot of growth runway. If you think about our goal to achieve €10,000,000,000 in revenue over the next couple of years, then I think Factor in the U. S. As a stand alone in the U. S. And selling it into the HelloFresh customer base and then eventually internationalizing it can contribute meaningfully through that €10,000,000,000 revenue goal. So that's really the logic around Factor. And we're just in the very first innings about what we want to do with the brand and what we want to do with them in that space. But we do think it's very attractive. Secondly, your question on customers that pay the, I think you called it, original price. So number 1, there is a headline price And discounted price, yes. Undiscounted price. So customers have different price incentives. So some customers have a high price incentive on the first orders. Other customers have smaller price incentives on multiple orders. But if you look at our overall customer base, then the vast vast majority of customers is in any given week not subject to any price incentives. Price incentives, however, are a very important measure for us. We much rather give a price incentive to customers to try out our service and form a habit over the 1st couple of weeks, then giving that same money to Facebook, Google or anyone else to do advertising. We much rather convinced customers to come in at a very attractive price point, try out the service, form a habit and then basically go on to pay sort of like an undiscounted price. But if you look at our profitability, I think we could discount a lot more or give a lot more incentives. And we just don't need to because after customers have formed a habit and understand the value of the products at an undistounded price, they usually become quite sticky. And so with the pricing structure that we have at the moment, to use price incentives mostly to get customers through the door and then to allow them to form a habit at a very advantageous price. That is something that has proven very successful over and over again over the last couple of years and more successful than spending the same amount of money on advertising on TV, Facebook, Google or any other platform. Okay. Very clear. So from your answers, I would I should assume it's the vast majority, I think, as you said. So 80% plus, is that fair, pay the discounted price roughly? I can't give you that answer on top of my head. It's not something that I look at, as a regular basis. Connections. In terms of country launches, I think, again, what we have disclosed at the Capital Markets Day is that we want to scale our new brands over the course of the year. So that's what we did with the Factor acquisition and with the GreenShafts U. K. Launch. Call. We also said we'll be launching new geographies over the course of the year. There are 2 that are in the mix for this year. And when we have updates on fixed launch dates, we'll make sure you'll be among the first to hear Codatin, but they're certainly on the plan for the rest of the year. The next question is from Clement Genolot, Bank of America. Your line is now open. Please go ahead. Good morning. Thank I've got 2 questions from my side, if I may. The first one is on the retention rates and especially in the U. S, what's Your view on this rate, is it still at versus pre COVID levels or now flat? And my second question is on raw materials inflation. I know that some big food manufacturers the And also on some back hedging. What's your view on this? And do you intend to absorb it cohort. So in terms of retention rates, we have seen over time over the last couple of years company that we have structurally improved order rates from our customers as we have invested in better pricing, as we have invested in better service levels and as we have invested in more choice for our consumers. So if you compare customers from 2017 to 2018 to 2019 to 2020. I think over all those years, we have seen that our retention rates have structurally improved as we have improved the product and basically created more value for each consumer that we serve. Quarter. I think it's also important to note that if you look at our average retention rate, that there that we benefit from very high order rates right in the beginning and then kind of like settle on the same page as other leading e commerce companies. So putting the 2 together, making our payback periods much, much quicker and making the overall cash efficiency much, much better content in food delivery or in overall e commerce. So that is something that is, I think, structurally really important to understand. Company. Now in the U. S, I think you definitely have seen that during COVID, these sort of like structural trends working more from home. They've also ordered sort of like more frequently. Now as we've seen sort of like some of the states sort of like more opening up. And as we've seen more countries moving back to sort of like a pre pandemic environment over time, we've also seen that there is some impact in our retention rate, but structurally, we continue to see the same trend. Quarter. So if we compare the Q1 of 2019 with the Q1 of 2020 and the Q1 of 2021, that you still see structurally class improving because we're just adding more and more value to our offering to consumers. And, Clement, on your second question on ingredient price inflation, so there's a certain level of that. Having If you look at our track record of decreasing procurement expenses as the central percentage of revenues, I would say that track record business. And you should expect from us that that's not going to fundamentally change going forward, I. E. The levers that we have ourselves in terms of optimizing our supplier conditions, in terms of our menu planning. Also, if there's a certain price inflation in attached to a certain category of ingredients, we have much higher flexibility to just bring different recipes, different ingredients and are not exposed to those kind of inflations as, let's say, a normal general grocer. And that will continue. So you should expect us to be able to maintain a very attractive procurement expense as a percentage of revenues. And for us, it's also not an automatism in terms of passing on price inflation to our customers. We set our pricing effectively at the levels where we, based on our price sets, can optimize for total cumulative profits that we achieve in those markets. It's not one for one linked to underlying food price inflation. With that, we Probably have to wrap it up here and let you go through your other commitments. We're already 7 minutes