Good morning, everyone. It's 10 o'clock and time to start today's presentation. It's a real pleasure to see you here and to welcome you to our shared webcast for Lekki, Karsten and Aveluplis. My name is Espen Erdal. I'm the CEO of Aveluplis.
And joining me on the call today, we will have Andreas Skalberg, who is the owner and CEO of Weljeke Kasten. In addition, I have Trine Engelbrekken, the ER Manager of Auropies, who will help me to make sure that we answer all the questions in the Q and A at the end of the presentation. The meeting is an open Teams meeting, so I advise all of you to keep your microphones muted during the presentation, And then we will open up for questions after we have done the presentation.
To our next call.
It's a very exciting day for both Auropeze and Willekekasten. With this acquisition, we position both companies for continued profitable growth. And we really look forward to start sharing best practices within all areas of our businesses. Arupis is acquiring 67% of Lekke Kasen, and it has been of great importance for us that Andreas Kaldewijk remain as CEO and owner of the company. We are very impressed by the way they have developed the team.
The team in Grinsta has developed the business until now, and we really look forward to working together with them in the future. To the purchase price for 67% of Norway's largest online toy store is €501,000,000 and our office has a preemptive right to acquire the remaining shares. Thus the purchase price will be settled in cash. To the acquisition. It's of great importance for Aeroprete.
And with this, We are expanding in an important product category and we gain access to very valuable e commerce expertise. We see significant operational synergies through joint sourcing of products and services and look forward to improve the retail offering to our consumers. Choice is a very important category in Norway, which where we see that all the Specialist Stores has been struggling for some time and it has opened up a great potential for online sales. But still we believe that Choice is an important category in physical retail. And with this acquisition, we can have a broad selection online as well as putting the best sellers into all Aurope stores across the country.
To the company.
We are acquiring Leffe Kasten Holding, which consists of the following group entities. You have Tas Import, which is the wholesale company that import toys and sells to the online and physical stores. To Life Skaldbag is the operational vehicle in Norway, which operates Lekki Kasten. Eno and 2 physical stores in Norway. To Shop Systems, that is a technology company developing e commerce solutions for the group.
To Esdeskogen 48 is the group's real estate company, which includes the newly expanded fulfillment center in Grimstad, now operating 21,000 square meters. And we have Toy Space, which is the brand name of the online stores in Sweden and Denmark. To the conference. I give the word to Andreas Kalleberg, who will give you a more detailed introduction to the company and the history. Andreas, the word is yours.
Thank you very much. I guess you guys can all hear me. It's been a crazy morning today, so I'm a little bit Flabbergasted, to be honest with you. It's I like to stay in the shadows in the background and suddenly I'm on national newspaper headlines and It's a little bit different, but yes, I'll try to keep it short and sweet and not to get too overboard. [SPEAKER
JEAN FRANCOIS PRUNEAU:] I'm the 3rd generation owner of the
family company and the leader. Normally with the 3rd generation things go sour, but for our in our case, we to make some changes to go online and we transformed the business in 2010, 2011 to go online and it's been a really success story for our company. We said that we had a passion for retail for almost 80 years and we still to truly believe in the retail model and we are really excited about the partnership with Aeropres that we're entering into. The picture here is also something we're proud of. It's our fulfillment center in Grimstad.
It's basically 4 building steps start in 2010 with 2,400 square meters and now we're up to 21,000 square meters. What I think is very interesting about it is that We think we can triple our business for through the existing facilities. So we believe that we have a really, really good plan for the future and we can to really boost growth for the coming 5 years now through the fulfillment center. And I just want to touch upon sort of Before we get into the next slide, touch upon sort of the change of control and the succession planning. Obviously, with the growth rates we We've been having for the last few years, we it was necessary for us to look at some kind of succession planning.
My father is turning 67 in the fall and we wanted to go out there. So we're going to contact with DHT Corporate Services in Oslo and they have been our financial advisor in the process. And for the last few months we had 4 offers from PE firms and Autopiece. But For me, it was a no brainer. When Autopiece came on board with the management team and their philosophy and as a retail company, and we truly believe in the retail business model with a variety of products in the stores.
Then it was just the perfect match and we wanted to get on board. And since then It's been such a smooth ride with Eldar and the team. And I think we're just super excited today to start to work on the future instead of No, this is with respect to our lawyers, but it's not so much fun to work with lawyers as it is to work on operational stuff. So we're excited at least. To I think I will get to next slide, Alain.
Yes, and in terms of to We like to talk. We're I would say that we're quite obsessed with the word ecosystem in our company. You've seen the warehouses owned by the company. [SPEAKER STAVROS VIZIRGIANAKIS:] And we think that the ecosystem is a huge part of our success. We don't outsource, we in source.
We have developers in house. We build strong team in house. We have our own marketing agency. We don't like to pay for services. We like to build it ourselves.
We don't want to rely on others. So I think that's I'm not saying that's for all companies, but for us it's been a huge part of our success It's that we build stuff in house and we're proud of what we managed to do from a technology standpoint and people business. We have, in In my opinion, a really strong management team. So and I love the fact that it's not like we sit here today and say we're perfect e commerce company. And pretty much every single meeting, we are sort of embarrassed about we need to improve on so many things.
And I think that's also part of the success here is that We're not sitting here today saying that we're good. We say that we have so many things we need to improve on. And I think that's what drives our motivation for the future is that we come to work on Mondays and we say This week we have to get faster, stronger, better. We have to improve conversion rates. We have to do stuff to make our sites better.
To At least that's what's driving the motivation for me as an owner and I feel passionate about the way we work. To Just the last point on this slide is that to the right here you see 2 graphs. 1 is showing the group revenues and the bottom one is showing the group EBITDA. I think we're not saying the only company, but we're one of the very few to companies out there that like to talk about future earnings and how much we make. When you talk to most online companies, They prefer to sort of push that to the future.
We will make money in the future. We are obsessed with making money now. We're not talking too much about algorithms or fancy buzzwords like to artificial intelligence, but we like to talk about building a proper business from scratch And try to grow on profitability, not just trying to get revenues up to as much as possible. And That was also key when we started to talk to Eldal and the team is that we sort of had the same mindset as we do. It doesn't help you to grow to revenues with 100% if EBITDA is not paying attention to what's happening with revenues.
So we it's just a perfect match share. We think alike and I think We can learn so much from Hydropeze in the future and I think we might be able to add some value as well to the company even though we're much smaller.
To too for the business and the way you focus on the bottom line that's fully in line with what we say. And like When we now see Aurope's and Lekkas together, it's like it's the kid in the toy store meeting the kid in the candy store and joining forces. That will just be a magic match. Like you said, Andreas, it's a very good match when it comes to the corporate culture, the way we work and the way we think. But it's also a very strong strategic match that will drive synergies.
And Lea, Kaczynski is basically ticking off to all the strategic boxes of Avril PRIS. We've said for a long time that we will strengthen the price and cost position. We will improve the customer experience and drive customer growth. And Wekicast will actually help to contribute to all these important initiatives. On strengthening price and cost position, we will start very fast with joint sourcing, and that is especially for the Far East goods when it comes to seasonal items for spring summer.
We have a big assortment overlap when it comes to seasonal assortment. And doing sourcing together, we know for sure pooling volumes will bring benefits to both companies. Lekki customers will get access to the Aladipis resources in Asia for sourcing. And of course, within on the cost side, there will be synergies. Inbound and outbound freight is some areas we will look into like payment terms and so on.
So we believe there are many synergies that will strengthen the price and cost to Cision for both companies. On improving customer experience, we are really excited to see that with Lekki Kasten's attractive product portfolio, We can actually improve the offering we have to our customers in the physical stores. So bringing bestsellers of Lekke to Carsten into the physical stores of Averroofilis and then having the broad selection online. I think that's a perfect match and really show how that to online and physical retail. We work and melt together in the future.
On driving customer growth, Obviously, we get access with this acquisition to a very attractive customer segment. The average customer of Lekkerkasten is female in the 30s, which is the younger generation that what we see in the Aeropis stores. So getting this exposure to these attractive customer segments at an early stage is very important and attractive for us. In addition to that, like Andreas said, they are obsessed by developing things themselves, having control, and they have their own tech company. And we believe that sharing development of e commerce and digital solutions will benefit both companies going forward.
To the next slide. The planning and cooperation will commence immediately as soon as the competition authorities has given their approval. We will get started. And we are really excited to work with the experienced management team at Lekki Kassel. Andreas has built a very strong team and himself will remain as CEO and owner of the company.
I will take upon the role as Chair of the Board. We have already established a road map to realize synergies. Sharing of best practices will start immediately as well as joint sourcing of products and services. But of course, on product sourcing, that will be subject to normal lead times. In the fall.
I'm really looking forward to that. We will start testing of Lekki customer assortment in selected Aurope's retail stores, And the rollout will then be based on the results we see from the tests. With that, I think I've just summarized that our ambition remains the same, that is to become the best Iscan Variety Retailer in Europe. And with this acquisition, I think we are really making a right move in that direction. So with this, we will open up for questions.
I ask you to to raise your hand when you have a question. And please just state your name and to whom you are directing the questions. You may ask to Andreas and to me. And if I lose track at some point really, you will support me. So I will give the word to you, and then you will unmute.
And after that, you mute again. I hope that sounds okay. I think the first question is coming from Eirik Raftal.
Yes. Hi, Espen. Hi, also Andreas Eiryk from Carnegie here. Thank you for taking my questions. I've got a bunch, but I'll try to limit myself.
I guess this kind of goes to both of you. And you talk qualitatively to the synergies. I think they're exciting, but could you share a bit more color on the synergies in in Nokken and what we should expect there over the coming maybe year or 2 or 3. And I also have to Andreas. And that's it's if you could share a bit more color on the historical growth rates kind of through 2018, very, very impressive both on revenue and EBITDA for 2018, 2019 2020, but maybe a bit before 2018 as well.
And I have 2 more and then I'll limit myself, this one to Espen. Just kind of the to current share of sales of toys in Europe, Reese, in terms of the size of the category. And also, I guess this one is for you, Espen, as well. You noted to that. Many of the specialists have been struggling.
We've seen Toys R Us go bankrupt. Kind of what gives you the confidence that You guys will succeed in physical toy sales when so many of the specialists have been struggling. I have a couple of more as well, but I think we should to turn give someone else a shot as well and I can jump on leave. It's okay.
Thank you, Eirik. I think I will to start answering the questions you directed to me and Andreas will fill in at the end. Your first question is regarding the synergies in NUK you and quantifying this for the coming 2 to 3 years. Obviously, that is a difficult question. We are not able to give you no exact answers to that.
We have started exploring the possibilities. I think on the sourcing synergies, you will not see synergies until 2023 because of the lead times you have to Far East. And already now, we have placed most of our orders for the summer season 'twenty three in order to get capacity at the manufacturers. So that's a little bit ahead of us. But on of course, on inbound freight, we all know that Audi Piece has a favorable deal with Maersk for freight costs.
And we can put Lekki Castell on the same agreement. We can either start negotiating some payment terms and looking into these kinds of synergies, which is more quicker and easier to grab. So we will for this. And when we have the numbers, we will communicate. Regarding the share of choice in the out of these stores, it is below 5%.
It has not been we are strong on the seasonal assortment for springsummer when it comes the trampolines and the beach toys and to small swimming pools, inflatables. So all this we are strong on, but we have not really succeeded on the choice because we are lacking access to the brands. And with Lekki Kasten, we get access to better brands. I think we can give our consumers a better offering. That leads us over to your final question regarding the success of choice in physical stores.
Of course, when the physical retailers are losing like 20%, 30% of the total sales to True Online, which has happened in this business, It's still some potential to sell Choice in physical stores and many of the physical specialist retails has closed down. So in many of the locations that Averroofis has a store, there are no other alternatives for physical sales of toys. And I think with our stores, with the broad selection, we are in an average store, we are giving 3 times 90 centimeters space for stores plus some floor space during the seasons. So it's not a big space we have for choice. But by bringing in more brands, we will give our customers a better product offering.
And I'm sure that for birthday segments, the best sellers, they have definitely a place in future retail, physical as well. And then you can get the broad selection online. So I'm sure that it's space for us to do this kind of deal in the market.
To the end of the year.
I think Andreas, the timeline was a little bit on the sales side, historically. Yes.
I'll comment on it. I just I wanted to comment quickly on sort of why I think Autopis is a success and why we want to do this. The big problem with toy stores is that you don't have the customer footprint at Autopis has. All this traffic, you can really leverage this and make this a huge success to begin with, in my opinion. I might be too overly enthusiastic about it, but like I truly believe in the model where they have all these customers coming into their stores.
And I think just redefining a little bit how we do toys will make it much better for both Aeropis and consumers. So that's just my $0.02 on that part of the business. When you asked me a question about to growth rates before 2018. It's important to mention that before 2018, we had a huge and massive to a competitor in Top Toy. They ran the Toys R Us brand and BR Toys in Scandinavia and they had a market share in Scandinavia of approximately, I would say 40% to 45%.
So, but we still had massive growth rates year over year. We did grow like 70% to 80% year over year, 90% some years. And it's always been a plan for us to grow exponentially over the since 2013 2014, we understood
that this might be a very, very big business.
So to comment on that, to that this might be a very, very big business. So to comment on that, we had quite we're from the to the Southern coast of Norway, if you know Norway, we're normally humble people, but we haven't been humble about our growth plans, to be honest with you. We always had huge goals. I mean, it was talked about the $1,000,000,000 before we even did $100,000,000 in revenues, because we believe in the model and the setup we have. To
the next question. That's perfect. Thank you, guys.
You're welcome. And then we have a question from Joachim
Harms. To
Yes. Hello. This is Joachim Harms from CPB in Hamburg. First of all, congratulations to both of you for striking such a deal. I can imagine it has been Quite an intensive process.
First question maybe to Andreas. Can you elaborate a bit more why did you decide in the very end to put the company up for sale. And you mentioned bits from Pirate Equity. I would like to understand your motivation there a bit better. Second question is to Aspen.
Can you elaborate a bit more how this specific acquisition to relates to your strategy of being the best variety discount retailer in Europe. I see that this is a specific vertical and I do not see, Ultimately, the link to discount, how you see that is relating? And maybe also connected to that, is that something you would expect to do more in the future. Thank
you. Yes, I guess I'll get started Espenor. To. Yes. You know why we wanted to put the company up for sale was basically just we wanted to we had so many companies getting in touch to be honest with you in 2020.
And we decided that now it's about time my father is 67 like I said. He's been working his hours for the last since 1974 and it was about time for us to sort of at least investigate what are the opportunities here. And as a fast growing company as well, Things change a little bit when you go from $100,000,000 to $500,000,000 and you plan to go to bigger numbers. You have to get more corporate in your mindset. And we understood that we don't have that capability in house.
It's better sometimes, even though we like to in source, we sometimes also understand that We have strengths and we have weaknesses. And one of our strengths are like we are very entrepreneurial. We like to develop. We like to create new things, but we also need someone to control to our business as we grow to become a very big business. So we understood that we needed to go out there and search the market for sort of professional buyers and professional investors.
To me, it was not at all about doing an exit. It was more about like we need to get to the next level of in our company and we need to take this from [SPEAKER UNIDENTIFIED COMPANY REPRESENTATIVE:] Which has always been my goal to take this from a family company to a proper company that can go to the next level. So to touch on sort of the More on the actual bids, we had 4 IOIs coming in and it was 3 from Typical investor, private equity investing companies, it was either based on the industrial side of the business. And like I said previously, It was really a it was not an evenly matched fight for the others. We decided pretty early on that we want to continue with Aeropis.
We did a lot to we were quite honest with our results in the beginning that we want to work with you guys. So it was just a match. It was just like there's a match here. To
the next question.
Thank you, Andreas. You are keen to elaborate a little bit more on the strategy to Parq. I think this acquisition is a perfect match with our strategy. And Andreas operates with Lekki Kasen, a very price focused company. They are price leader when it comes to toys in Norway and Sweden and then potentially Denmark in the autumn.
And for us, having low prices is the reason why we exist. And doing this acquisition, we will get access to brands at to prices that we couldn't get in the past. So for us, this is strengthening the price position of the company, And it's also giving us a very attractive vertical. We can offer our consumers the best sellers in the stores and then provide the selection online. And I think online shopping and physical shopping is a little bit different.
Like Andreas said, the footprint of Aeropie is with 36,000,000 customers transactions a year is massive. And we are exposing many customers for the products in our stores. While Doing shopping, if you want to buy toys, you go to an online store, you do that very specific on your search, but you will get the exposure of your products to much, much broader population than what you do online. So I think getting this exposure And for us, it's about exploring the online possibility for expanding the business. And we did a small acquisition back in March where we acquired 67% of LUNIUM in the interior segment.
And I think this is a smart way of connecting the online retail and the physical retail. These are product segments that is performing well online, but also are performing well in the physical stores. So I think Getting disconnected is like the new way of retail. And I think this will means that in the end, the physical and the online retail will melt together, and this is the start to that. So I think this really makes sense where we can give our customers a better product offering in the stores and we will get even more customers exposed for the great products and the prices that Lekki Kasten has.
Thank you.
Okay. Then the next question is from Markus Berg Heiberg.
Yes. Thank you. So Good morning and congratulations within a very interesting deal here. I want to follow-up a bit my first question here on difference in your e commerce operations because on one side you have this new 2 e commerce pure players that are very focused on, say, home deliveries, etcetera, whereas your e commerce operations in Europe, please, are very focused on driving customer traffic to the stores because that's where you have your profitability. So I want a bit more clarity on how you want to integrate this and how this makes sense together.
That's my first question. And my second question is on the Nordic expansion and the ambitions to grow in Sweden and Denmark and what we can expect there because it seems like Sweden was a very important growth driver in 2020. And do you expect a similar development in Denmark? And also lastly to Espen, is there any synergies here with OBE? Those are my two questions.
Thank you, Markus. On the first one, when you ask how we should integrate this, then I would basically to say we shouldn't integrate it because it's a great company that works well on their own, but we should take the best parts of Lekki Kastner and bringing it into AlloPis. And we should take the best experiences from AlloPis and share with Lekki Kastner. I think that will strengthen to both companies. So it's not about doing the integration.
I think Andreas needs to have a little bit of his freedom with his team in Grimstad, to continue to be an independent entity. So I think if you put power on the out of his store online, The selection is very broad. When you do online shopping as a consumer, you are more targeted on the products you search. So doing variety to retail online. It's more difficult.
We see clearly that what we sell online is mainly related to seasonal items, more expensive items, and people do click and collect. I think if we sell some choice at 99, 149 in our stores, That is not that is something that is really subject to online competition. Andrea's basket is bigger online then it will be in our stores because the customers are more targeted. So I think this is just an add on for to both companies. And so, I think it works well together, should not be integrated as stores.
But on the technology side, we should learn a lot from each other, because Andreas has developed his own e commerce platform. He's operating the same system as we are on our e commerce. So I think it will speed up the process of developing good solutions for our customers and it could also make it less expensive in the future. I think that's how it works. I think I will leave the Denmark expansion over to Andreas, but I will quickly.
You had a question about the synergies towards OBEA. And to be quite honest, we have not discussed this deal with OBEA. But of course, doing joint sourcing, that is the to take idea of the OBEA transaction. And when we'd let the customers add more volume, that is, of course, interesting. Future wise, if it's an idea to bring Delek Custom Products into to the OBS stores.
Well, that could be, but it has not been discussed at this point. So Andreas, maybe you should comment on the Denmark expansion plans.
Yes, definitely. Just to be clear, we look at our business in Three ways. We have Norway, Sweden, Denmark. We're extremely early days in Sweden yet. We just launched in May 2019 and we had a massive growth last year and we back to very good growth this year.
So I don't want to get into specific numbers, but it's definitely growth good growth rates coming up. And Denmark, it's really hard for me to tell. We're launching there in the second half of twenty twenty one. We are confident that we have a good setup for for Denmark as well. To speak numbers, I think it's a little bit early.
Let's look at let's just build a proper business there first and make sure we launch with enough products and a really good offering. We're more obsessed with the logistics setup. So we set up a very good new logistics setup for Sweden and Denmark, which will deliver packages 12 hours faster than we do today. So we will get a much better logistics set up for the future, which I think will drive customer satisfaction for the future. You.
That's really our goal to speed up deliveries and make sure that we have the same speed of deliveries in Denmark and Sweden as we have in Norway. And I think That's key to our success in the future. And also just I would comment quickly on sort of the we're obviously quite large in Norway, Well, I think there's a lot of growth to be taken out of Norway as well. And it's really our it's a really good market for us. And I think What I love about this deal with Aeropie is that it's really taking some of the risk down.
We can also get into retail now with 2 68 stores plus our online sales. So I just think there's so much fun stuff going on right now. So I get a little bit excited. I should stop.
Thank you. That's very clear.
To the next question.
Okay. Next question is from Ole Martin, Westgold.
Hi. Hopefully, you can hear me. I mean, congratulations with our hopefully it's going to be a very interesting acquisition at an interesting price. My first question is to Andreas. It's been fantastic growth over the last couple of years.
And Obviously, the last year we've been through obviously huge COVID effects in there. I guess it's difficult to sort of separate hot from cold water. But to do you have any sort of feel for how we should think about COVID effects from last year? And how should we think about the structural growth going forward if you have sort of any sort of structural growth rates that you see in Norway and how should we think about maybe Sweden and that work is a bit special. But Any flavor on that would be very interesting.
Thanks. Yes, definitely. Obviously, in the 12th March last year, we saw the lockdown in Norway, especially just it was boosting our sales like crazy the same day. I was at the cabin and I saw it It was like AWS alerts with high traffic and it was just crazy. So obviously, there was a huge COVID effect in the early parts 2020.
But what's interesting to me is that we've had growth year to date and we did not expect growth year to date to be honest with you, because we haven't had a lockdown this year. So I think what we see now, at least in our industry, in the toy segment, is that we see a huge shift to online shopping. And We've had so many happy customers in 2020 shopping with us in spring and second half year. And we see that we really are able to to get those customers to get back to us. And we think COVID just gave us another 1 or 2 years head start to the growth we had planned.
So So we just think it's more of like it just boosted our growth rate a little bit. It's not like we're not going to grow. It's more like we Came to a higher level within just a few months. So we are optimistic about the future and we think growth will come.
To And maybe one follow-up for me. When you look at the profitability between the various countries, obviously Norway, to Sweden. Is there any difference there in terms of gross margin of the products? Or do you see the same kind of pricing?
It's I don't want to get into too much to the specific details on. But we have obviously there's we have a toolkit now that we can do differentiated pricing in Denmark, Sweden and Norway. And we will suddenly we were certainly to test differentiated pricing in the future, but it's a little bit too technical for me to get into. But we have the 3 different sites that we will definitely look at sort of to a more differentiated approach to e commerce in the future.
And then a final question for me. Obviously, you have access to a much to a broader variety of products and brands than Hydropeas has been offering. Is there any troubles down the road of sort of Putting those brands in Aeroprete stores in the agreements that you have with these vendors or you don't consider that to be an issue?
I personally don't consider it to be an issue. I think we have very strong relationships. And I think we'll get back with a strong retail team at So we'll present a plan that's more than it's not just putting the items in the shelf. It's more of a it's a brand plan, it's a toy plan. It's more It's not just we have planograms and we do stuff properly instead of just toys will be done properly, not just throwing items into the shelves.
To Okay. And congratulations to both of you. Thanks.
Thank you, Ole Martin. Then the next question is from Peter Nystrom.
To Yes. Thank you, Espen, and congratulation to both of you. I actually got answer here from Ole Martin on to brand availability, but I can have a follow-up on that. And that's probably then to Andreas. Can you also share some comment on your brand's availability over time and how that development has been?
To Brand availability over time. In the toy segment, we never had problems with brand availability. We've always been since early days, we had all the brands available to us. So it's not there's never been an issue for us to get the brands we want basically. There are every now and then some certain high end, more like the fashion design brands that don't want to get into us.
But That's not our niche either. We want to focus on the big selling high volume brands. We don't want to go into too much too specifics on those. So I don't consider that an issue at all.
Perfect. Thanks.
Okay. Thank you. And then the next question is from Christophe Pedersen. To Hi.
This is Christopher Pattison from Nordea Markets. Congrats on the transaction. I have a couple of questions. Andreas, do you know how much of toy sales in Norway is online in the overall markets? And also to You had an impressive growth in EBITDA here.
And given that you have ample capacity in the fulfillment center, I guess also the cash flow will be strong in Norway going forward. To can you talk a little bit about
this? Yes. I'll touch on the share of sales and how much we think is going online. It's hard. We have estimates that we believe it's about 25% in Norway right now.
We see in more e commerce developed markets, we We see e commerce getting up to 50% like in Germany and the U. K. And we think just a huge we're going to ride this wave for the next 2 years. We think to the online toys growth which is explode for the next 5 years in the online business. To the second part of your question, I'm sorry, I forgot the second part.
Yes, I was wondering how the you have seen a very good growth in EBITDA and given that You have quite a lot of capacity, as I mentioned, in the fulfillment center. I guess the cash flows will be quite strong to the regional operations.
Yes,
yes. We overinvested. We might feel a bit crazy. We overinvested in the warehouse. We don't want to be you.
Now we sort of maxed out the warehouse that we can build here in Grimstad and the next step would be to build the warehouse somewhere else. So we think this It's really good for the future cash flow that we're seeing right now that we have this warehouse that can really take us. I believe we can triple our business, but let's say 2.5x on today's level easily through the existing warehouse.
Thank you.
To the
operator, Christophe. Then we have Eirikir Aftal with a question.
Yes. Hi, guys. Again, Eirik from Carnegie. Just two last ones from me. And I guess it's a bit of a follow-up on Christophe's first question then on margins for Andreas.
And you've taken massive steps up on margins every year the last 3 years. Just kind of your thoughts in terms of what you think is kind of steady state margin to for Lekkasnes and also one for Espen. Just in terms of the Obert transaction, you. Does this affect your priorities in any way like considering implementation time, tying to management resources, etcetera. Would like, I guess, just your thoughts on that as well would be great.
Thanks.
To Do you want me to start, Espen or should you start?
No, just go ahead, please.
Yes. Talking about margins, we could spend an hour another hour on how we think about margins. When you do online business, you have to think about margins in a very different way from how you think about in the retail business. If you do 30% margin on the LEGO box, it's really good. But if you do 30% margin on a big heavy toy house, which Ship is very expensive.
It's not good business. So we think about margins from a cost to base. How much does it cost to pick? How much it costs to ship? What are the payment terms?
How fast can we to turn our products and it's complicated. I don't see margins going up in the future, but again, We are cost based. We try to optimize our cost base every day. We have shown for the last 2 years that it's a scalable business. Our variable Cost is going down in the company year over year.
It's always going down and that's our focus. We want to make sure we have a really good cost base in our company, so we can grow profitably and with tough competition.
Thank you. And Eric, your final question for me on how this might impact the Orbea transaction. I would just have to to say it will not impact at all. I think this acquisition is something we do in parallel to the sourcing and the start of cooperation with Lekki Casten. It's a very important and strong category project for us.
That doesn't really involve that much resources from our side, except for the category managers in that specific category. So this is something that we can do in parallel. It will not impact our capacity on the management side to do OBEA and it will not impact the financial capability to do. As you know, this will be this transaction will be settled in cash. We have sufficient cash facilities available and the OBE transaction to be settled in shares and we have those treasury shares on hand.
So this will not impact the OBE transaction at all.
To That's very clear. Thanks, guys.
Thank you. Then it's still under Martin. Wes
to
the end of this Q and A session. And Would like to thank everyone for participating. Hope you got the information you wanted. And if you have any follow-up questions, please feel free to contact to Rene Englakken at Investor Relations with Autopis. So once again, Andreas, thank you very much for starting this cooperation with us.
We are really looking forward to it. And I think you all can see that Andreas, he will drive also ADROPIS forward in the future. So thank you very much. Have a nice day.
Thank you.