Earnings Call: Q1 2021

May 7, 2021

Thank you, and good morning, everybody. Welcome to the Stanley Steiner Q1 presentation. Q1 is a quarter where we deliver a stable development in a challenging environment. We deliver an underlying 3% growth. The retail business showed a resilient performance and a low demand for our foodservice sector. Adjusted EBIT comes in at SEK 88,000,000 versus SEK 75,000,000 in the Q2 of last year. It's a quarter where we use the new segments to support value creation for the group going forward. It's also the quarter where we introduced a new sustainability reporting, and We'll be going more into detail to that also. It's also I want to make clear that we are going through a full review of It's a very good business, and we're going to talk a bit more about that also at the later date. So flipping page, Looking at the total business over time, we show a strong and resilient track record With a KEGS net sales CAGR up 7% over the last 5 years, stable EBITDA margins of the within the region 7% to 8% and also stable returns on capital employed within the region of 10% to 11%. Looking at the quarter, stable Q1 in terms of markets and Returns, giving this the current environment, mainly impacted by COVID-nineteen and bird flu effect that impact foodservice and export sales. And then we have got challenges in the ready to cook business in Denmark. Going on to the next page, here we introduce amongst a long list of Sustainability keep the eyes that we follow on track internally, we have identified the 6 that we think give a good impression on how we are forming within this EC area. 1 we will be looking at is and report externally, and Julia will come back to how we actually perform It's CO2 emissions. We will be looking at the well-being of our employees, the lost time within injuries. We'll be looking at the use of integrated products in the value chain. We'll be looking at the feed efficiency, How much feed goes into producing 1 kilo of bird? We'll be looking at the animal that these papers are living under and we will also be looking at critical facts and more about that later. Going on to the next page, you see very strong drivers for the substitution through which chicken. The Q2 impact of chicken is about 10 times lower than that of Red Leaf, quite remarkable when you think about it. And it can have a similarly low climate impact as fish and plant based, as you can see from this chart. In addition, it's healthy and affordable. We see a clear untapped potential in our domestic market versus more developed geographies. So you can see to the right of this paid consumption level versus other geographies. Talking about the growth potential here on the next page, drive organic growth is one of our 3 pillars for value creation, really to continue to have a very high focus on strong innovations across the group, also taking best practice within this field. That coupled will improve product efficiency and reduce costs through the entire value chain and then also to look to which degree we can export this into other companies. Looking on to Page 8, giving a little snapshot at Scanner Standard. You see our 5 domestic markets. Our presence in those markets give us a diversified country specific risk. We see strong local brands in each of these geographies. We're to cook being the core of the business. We are well represented in all 5. If you are from this where we have had a cake over the last 5 years of 5% and looking ready to eat. There we are represented with significance in Sweden, Norway and in Denmark. And within this area, the CAGR over the last 5 years is more than 30. Target leading positions in 3 out of 5 geographies, number 2 in 1 and number 3 in the last one. And flipping page, you can see how our strategy execution for growth looks like focusing on best practice sharing, product development, driving scale advantages through the value chain and also trying to export this. And to the right, you see the areas in which we are constantly trying finding the right balance and finding which efforts to be shared across the group. Going on to Page 10, giving you a list of the background to the new segment reporting, something that has been prepared for a couple of years to make sure that we are prepared, have the historical data in place and so forth. You will be aware that our Railies to Eat category have grown organically from a bit less than €500,000,000 now to €2,000,000,000 And you can see to the right that if we haven't been for COVID-nineteen in 2020, we would have to deliver a clear increase in net sales also in 2020. So this category represents a bigger growth potential. It, as you will also see later, reports clearly higher margins, and we believe growth in this area will also have a positive impact on our trading multiple over time. We now represent 19% of group sales, and that development have Accentuated the rationale for the separate follow-up of ready to eat and ready to cook. It's largely different skill sets. It's different production processes, different production lines that are making these products. And we believe this is a better way to identify and spread back the best practice to form a basis to continue to grow and to improve margins We will be having 2 reportable segments. It reflects how we manage and monitor the business. We have restated the financial information that's presented in the press release from the 1st April and there's more particularly more details on note to of that. Having said that, the dedicated country organizations remain unchanged within the maximum The organization of Sanddysandla. Just to remind you, within the ready to cook area, we have got 5 main production sites, 1 in each country. And ready to eat, we've got 3 production sites across the group. Going on to the next page, Page 11. You see the segment breakdown that of this quarter, 78% is rated And the 18% is ready to eat. To the right, you see how these two segments have contributed to the EBIT development, Radies to group have impacted with an improvement of SEK 2,000,000. For the highlights, we have impacted with SEK 13,000,000. On the bottom of this page, you see how these segments are broken up and how they all add up to the group total. Looking more into Bailey Secooq. This product area delivered a 5% growth Fixed currency, 2% in the quarter. Adjusted EBIT being at SEK 69,000,000, the same level as last year and margins also at the second level. And within these numbers, we have taken a hit of SEK 19,000,000 relating to Bertha Blue in this quarter. And if it hasn't been for that, that will present actually about 1 percentage point of margin. You also see here, we've seen a positive development in Well, we have seen many more weather metrics. Although this quarter is seasonally more challenging due to the cold weather, We've seen stable development in injuries and there has been no critical complaints in this quarter. Going on to Page 13, 5% underlying growth within 36 can be broken into a topic where Norway, Denmark and Finland have the majority of the growth. In Sweden, we have been focusing on less activities, on campaign activities, margins, and we have had flat development in Ireland in this quarter. Of this growth of the 5%, 4% comes from within the retail area, that represents all in all, about 80% of all sales of Ready TO Cook, and we had a positive development from Cooking Brands. And the growth in Shield drive Foodservice sales dropping with 12% as we continue to see restrictions on consumption across Europe. Within the export area, you see we have sold that. We have realized really exceptionally low export prices, firstly due to the COVID-nineteen, but there's an oversupply of food service market in Europe, and that has been further accelerated by a new outbreak and the restrictions to the sale of surplus products in Sapiensha. Going a bit more into Ready to Cook, looking at the breakdown of Ready to Cook products into wheat And into Foodservice, we see relatively stable, 4% to 8% growth on a quarter by quarter basis with the retail, whereas Foodservice is down with about 12%. It also shows, when you look at the photograph, that once the future risk outlets are allowed to reopen, And we will see a clear coming back to growth development in total revenue. If you then look into the EBIT bridge, properties, Cook, I see altogether a stable adjusted EBIT, The environment and positive volume development driven by growth in Norway and Finland It's also impacted by quite significant inventory sellout in Denmark. We've had negative pricemix, mainly driven by very low export prices, as mentioned. And we have seen an increase in cost of goods sold, mainly relating to peat prices increasing in Ireland and also reduced production cost is always driving that number. In improved OpEx, partly related to the strategy project that we did in Q1 of last year. Going into the key priorities within the Swedish Krog on Page 16. It's clear that the Swedish Krog business in Denmark continue struggle. This part of the Danish business delivered a negative EBIT of SEK 50,000,000 in the quarter, driven mainly by a lot of stock clearance in a very difficult export market, also high cost or high product cost. And this is my primary focus to make sure that we have defined a sustainable turnaround for this business. Also bringing you awareness to the fact that we see historic high increases The feed cost, and as we are milling the feed ourselves here in Ireland, we initially get the impact there. We are in the process of ensuring that we get the selling prices adjusted accordingly. And we do anticipate a high level of compensation due to this relationship model that we have been working to over many years. There might be a bit of phasing for a few months, but otherwise we anticipate good competition. Another area I would like to draw your attention to is very systematic yield improvement program that we have underway initially implemented in Norway and also now being introduced in Sweden will be rolled out in 2 parts of plants within the coming year or 2. Going from ready to cook to ready to eat on Page 17, within this area, we saw a 7% decrease in reported sales and 3 And the decrease in local currency, driven by the lockdowns in Northern Europe. Adjusted EBIT coming in at SEK 26,000,000 from a low quarter we had last year. And in these numbers, we have taken a hit of SEK 9,000,000 due to the fact that we have had Its e production line closed in part of this quarter. That closure have impacted numbers by about SEK 9,000,000. And if you were to learn, With those back, this part of the business actually delivered more than 10% EBITDA margin in line with our financial targets. Employee injury is below our 12 months rolling, And we've seen a large drop in critical complaints. Going on to Page 18, Looking a bit further into the Baby to Eat area, we delivered a 19% growth in those products sold into retail. So of the 3% decline in fixed currency, we've seen good growth in Sweden and in Norway, markets where there is a very high domestic and and retail exposure. We've seen a COVID-nineteen related decline in Denmark due to these temporarily low activities, particularly in the quick service restaurant area in all of Europe. The channel change altogether, obviously, retail growing by 19%, as mentioned. And it kind of shows the high demand for these convenience products also now really coming through within retail, which service dropping by 16%, where we are confident that once these outlets reopen that we will see a strong bounce back from this area. Looking on to the EBIT bridge for Ready to Eat. EBIT coming in at SEK 6,000,000, partly impacted by reduced volume, mainly driven by this a quick service restaurant area in all in Europe. We've seen a clear positive price of price product mix with a positive mix from higher share of high market products. We also had benefit from the low prices on third party raw material purchase That impact positively into this area and also some positive development from OpEx improvements. Going on to the next page, looking at the breakdown It's the retail and foodservice already to eat. You see a strong demand within retail, and we have referred to that. And first, foodservice being down. But it's also clear when you look at the numbers to the bottom of this graph that once foodservice reopen, you will see Quite a significant close of those gaps, which we here have realized. So As we are all aware, these restrictions largely will be still in place, and we anticipate that they will be gradually lifted during the course of the second half second quarter of the year and will resume good balance sheet coming to the second half of the year. Looking at the other parts with that all of the other the remaining area is basically regions and also Group costs, you can see that on Page 21. Going into the last area I'll talk a little bit about is as part of our sustainable protein offering, we're really gearing up our plant based product activities. Initially, we introduced the plant based products that are branded. We have launched those in April in a couple of markets across Europe. We now have confirmed listings for the second half of the year in Norway for a branded concept that we have developed over a period now sending about 50% of all RTE sales in Norway, where we now will be extended that range with plant based products. Looking at our now SEK 2,000,000,000 Ready to Eat business, that's clearly an ideal platform to roll out these and several other plant based concepts, similar brands, same brands, same product development skills. These products are produced at the same production lines, same customers, same logistics setup and it's basically the same Brian, so we can extend into this area. It's a very low obviously, low risk strategy and to build this step by step over time. With that, I would like to hand over to Julia for more numbers. Thank you, Leif. Yes, more numbers. So on Page 24, we're coming back to the overall P and L. And as we've been mentioning, we've done quite a lot of changes to our reporting In this quarter, it was up to the format of the report that we implemented these new reportable segments. And the group has also implemented a new strict definition So items affecting comparability. To be able to compare between the years, we have also restated the years 2020 2019 for this. You can find more information about these in the notes in the quarterly report. But what you can see here for in this quarter now, we have no non comparable license and the same for the restated Q1 of 2020, there's no non comparable items. Looking at the margins, they are improving versus last year, but they are coming off from a low base. Looking at the finance net, it is low compared to last year. This is mainly driven by the fact we had Quite high negative currency effects last year, but we also have a bit of reduced interest rate costs in this quarter compared to previous year. It's a quite high tax rate, around 24% in this quarter. This is mainly driven by a negative adjustment that we do to last year expenses around SEK 3,000,000. Without that, it would have been more in the area where we normally are, 20%. Overall, the income for the period and adjusted ETFs are improving, again from a low base, but we're still seeing improvement. Moving on to Page 25, Looking here at the sustainability targets, there were the results of the targets that Leif was mentioning before across these 6 KPIs that we are measuring now. Also worth noticing that these targets are part of the management team's bonus scheme since 2020 and now also in 2021. Looking first at the CO2 target, here we are actually emissions are increasing by 2%, which is not ideal. Our target for the year is to decrease by 10%. It's an ambitious target. We have put in place with a lot of new efforts here, also initiated together with the science based target initiative. Looking at the lost time injury, the way we measure the safety in our plants, we also have seen an increase of 8% versus the same quarter last year. This was not where we want to be. We also want to be the target is to reduce by 10% versus last year. And also here, we're putting in measures in place to be able to reach these targets. Looking at the use of antibiotics, here we see a continuous decrease. We're down 16% versus the same quarter last year. So here we are expecting to be putting a target to reduce even further for the full year and we're hoping to reach this. Looking at seed efficiency, So there is the kilo feed needed for 1 kilo of light weight. This is relatively stable Compared to the last year, the same quarter, we do have an overall target of decreasing this further, and we are hopeful to reach this as well. Looking at the animal welfare indicator that we are mentioning, we are using what we call a foot score. This is also improving versus the same quarter a little bit, 5%. As Leif was mentioning, this number is quite heavily impacted by the climate in the Q1. We have an ambitious target of coming down to 8. We also have targeted place to be able to reach this. It's mainly driven within the Irish and Swedish farmers to come to the target. You can finally look at critical complaints. We had only 1 this quarter compared to 6 in the same quarter, so it's a quite hefty reduction. Also ambitious target for the year must be at 0, maybe a little bit more of an additional target, but this is still what we are aiming for. What's noting overall here is that, I mean, we are starting to starting with this. So now we're showing you what we are measuring internally, but we do to refine these measures over time, for example, here with the science based target initiative. Moving on to Page 26, looking at our returns. We are seeing improved returns versus the same quarter last year despite increase in both capital employed and equity. Now the adjusted The return on capital employed is at 9.8% and adjusted return on equity is at 11.9%. And equity ratio continues to improve at 1% up. This is last year's now at 29.8%. Moving to Page 27, looking at our working capital situation. We still see a continued low level of working capital, obviously, helping our overall cash situation. It was slightly negative actually this quarter. There's been a positive contribution from Postpaid tax payments related to COVID-nineteen state aid of SEK 17,000,000. We do also have reduced inventory. As we talked about, we had some sellouts in this quarter, Quite some big reduction versus last year and also at the end of 2020. And there are quite low receivables This quarter, as you've had less export shipments, it has long payment terms. So all in all, we're coming to our working capital Sales ratio of 0.1 percent minus 0.1%. If I were to adjust this for the Contribution from state paid, we would have been at plus 0.1%, still very low. Also if I would adjust it for the financing elements that we do have in our In here with terms of factoring, etcetera, it would be up at 5.5%. So still below where we ended last year, but sort of in line with the target level of being 6% working capital to sales ratio. Looking at our cash flow overall on Page 28. We do see a fairly strong operating cash flow despite the challenging environment we had. As I said, we have a help from lower working capital with the lower inventory levels. On the opposite, we've had quite a bit of slight from flow in CapEx spending in this quarter. The paid taxes in this quarter is Quite high. It's again affected by an adjustment related to preliminary tax payment in Ireland that was a bit too low last year. Those are the other items. We have done a repurchase of share of SEK 32,000,000 this year. There was no activity left last year. And the other items in And the other point in that is net related to net leasing and negative currency effects on the NIBD. So overall, we have a change in the NIBD of Minus €8,000,000 I would still say overall we have a robust balance sheet. Our leverage was at €2,500,000,000 And we have a strong liquidity still in the company. Moving on to the Slide 29 and our cash flow guidance. There is basically no change versus last time. The capital expenditure for 2021 is still estimated to be around €400,000,000 up from €355,000,000 in 2020, driven by a combination of Efficiency investments, capacity and ESD investments on top of the normal growing maintenance. The paid interest is estimated to be at 3% to 3.5% of average NIBD and there have been the tax rate to be around 19 to 20. We do still have our continued liability in the shape of the Manuform acquisition. As you know, there has been 3 owner trenches, 1 for 2019, 2020 2021. So the last tranche is now due in 2021. Looking at the dividend, the Board is in today's AGM proposing a dividend of SEK2.25 SEK1.25 per share. We expect this to go through. The Board also intends to call for an EGM in the second half to propose an additional dividend of SEK1.25 per share. So overall, if you add it together, we have a dividend yield from closing in on 4%. And we just want to remind you that our dividend policy is to be at around 6% of net earnings over time. And with that, I'd like to hand back to you, Ulf. Thank you, Liam. As you I think you all got the impression that Q1 delivered a stable result in a challenging environment, impacted mainly by continued COVID-nineteen impact, but also top top with Berke Lueb. We do see a full review of the Danish ready to cook business underway. New management I think today, recently, we identified a number of building blocks that we are following through very clearly. Overall, We see price adjustments will be expected to absorb the effect of the raw material increases. The new segment focus that we implemented have implemented, we are confident it will support performance and value creation, giving even more focus on particularly RTE, but also on Raditzenkrupp. We have a strong dedication to Focus even more on improving our already leading sustainability position. We'll be reporting much more clearly on this on an ongoing basis. We will be calling for an ESG day, inviting for an ESG day Later on in the year, we will be excited to talk a bit much more about this exciting area. Hopefully, also you saw here that we are quite excited about our plant based initiatives and the way they are compressing. We do expect gradual improvements in the market conditions in the second half of the year. And to be more specific when it comes to COVID-nineteen effects, do anticipate the reopening gradually impacting crew service sales during the course of Q2, but we fully take more into the second half of the year. And the board intends to call for an ATM in the second half of the year to It's an additional dividend of SEK 1.25 per share. With that, I'd like to take any kind of questions. Thank you. We have a question from Daniel Schmidt of Danske Bank. Daniel, the line is yours. Yes. Good morning, Leif and Julia. A couple of questions from me. And you're right in the report and you also commented on the last slide, Leif, regarding the Cooking business or Ready to Cook business in Denmark. You're right in the business that You're looking to find a sustainable long term solution for the Danish ready to cook business. And I think You mentioned lastly here building blocks and you said new management, if I'm correct, if I heard you right. But is there also are you guys also contemplating Selling this business? I mean, we are we're looking at all options, But it is clear that we have identified a number of building blocks that we will be implemented and also that we are confident that we will see performance improving. But this is, as mentioned, a key priority for us to make a turnaround of this business. But are you saying that turnaround is The sort of the number one priority and if that doesn't pan out the way you expect, then you would be Considering divesting or are you pursuing both at a sort of at an equal focus? We have a focus on improving the performance of the Danish business and are not ruling out any scenarios. But as mentioned, the new management have identified a lot of improvement opportunities which we will be implementing and we will also see a clear improvement in performance coming into Q2 and also later on. And can you say anything about those building blocks? No, but they are quite I do realize that we're coming from a low base in But it is we will see a clear improvement in the performance in Denmark and in particularly in the integrated group area in Q2 and also in the quarters after that. Okay. Better, better balance. On the volume we take in to what we sell, it's one of the building blocks. We're also looking at other areas in addition to. Okay. But just coming back to the possibility to divest these entities, Is that a difficult exercise to sort of untangle? Or is it very intertwined with the rest of your operations If you look at it on a stand alone basis? But I mean, if you look at it, at all our businesses, our registry group and registry In all our markets, they are linked together in the sense that there are some raw material sourcing, but they also We're also sourcing from third parties. It is a different manufacturing set up in all other markets. That's also why We are making this, let's say, new segment approach to it, so we can ensure even more focus. So it's more There's some sourcing synergies, there's some commercial synergies. But otherwise, it is it's a different manufacturing set up and so forth. No matter where you look at Denmark or in the middle of our market. All right. Okay. So you're basically saying that You're pursuing both avenues, but it sounds like you are seeing improvements already in Q2 versus what you saw in Q1 From an operational perspective at least? Yes. Yes. And then sort of coming To raw material, as you mentioned, being a synergy between the different entities. And you've seen rising raw material costs, Of course, and most of that is passed through if you look at the Nordic business, but maybe some delay when it comes to the Irish business. And you mentioned some phasing effects of a couple of months. Could you quantify that a bit more what the sort of the short term impact could be when you look at Q2? When we as you rightly in Ireland, we are buying in the feed format ourselves as we are milling the fee and sending it to the farmers within our own operation. So there we get The cost inflation hit our own purchases quicker. And there we are in the market with price increases. So there we have seen a And it's something that over the time, we have to, let's say, buy more expensive raw materials until we get the selling prices adjusted. So there is a bit of phasing there, a little bit of it coming already realized in Q1 and a bit of it coming into Q2. When you look at the Nordic region, Traditionally, the phasing effects have been very small, basically aiming to implement the price increases on the birds on the same day as we get the price increases from our customers. Sometimes not 100% on the same day, but it is and as you will know, our track record in this field is good. So that is generally a good understanding that feed initiated raw material inflation that we get compensated for. And we also compensate when fee prices are going down. So it's It works both ways. But if I heard you correctly, you said that you already had some negative impact from phasing in Q1 and there will be some in Q2. Well, will they be of Cool magnitude, and this will be sort of behind us. If we look at spot prices today, you should be through this effect As you get into Q3, is that how we should look at it? Yes. That's what we anticipate. Of course, the feed prices are going a lot. And you know as well there is also some element of speculation going into this area. So It is relatively volatile, the peak price the peak market at the moment. So our my main focus is ensure that we get compensation in the market and that we are confident we will get. Yes. But the impact on Q2 is not going to be significantly higher than in Q1. Is that Correct to say? Yes. Okay. All right. And then on the bird flu, and you're right in the report that given that we had additional outbreaks in April in Denmark Sweden, sort of the export ban is prolonged until August. You did have sort of extra cost for it in Q1, of course, and in Q4 last year. Are you seeing those costs fading in any way in terms of What prices or is this still going to be sort of a similar impact in Q2 as you see it and maybe also during the summer? I think the vertical effect is going to be relatively similar into Q2 as we have seen more outbreaks coming out. When it comes to export prices, one has to keep in mind that it's very exceptionally low export prices that we have seen Basically all through last year or since the COVID-nineteen impact and also into this year is mainly driven by the pandemic. The way the foodservice market in Europe is underwater have meant that there is a surplus of chicken product from Not so much from us, but we also have a bit. But it's mainly from other Continental European players. Some of them are, let's say, 80% foodservice and industrial related in the client portfolios. Of course, a lot of these volumes come out at very, very low prices. So as We see the impact of that reduced. We also I think we can say that we can see some improvement in export prices in Europe. It is from a very low price very, very low base. But we have seen concerns in European players actually taking volume down, but there has been a little bit less pressure on the supply and demand situation. So some improvement there. Well, as the first two impact, we are more into August until we see that coming through in the Asian markets because we are depending on them actually reopening. Yes. But that also assumes that there's not going to be any additional breakouts during the summer. Is that correct? Yes. I want to also have to say that it's quite a number of years back. We had it last time. And Usually, these outbreaks, it's very rare to see them all the summer. Yes. They usually die down with the heat basically. Yes, exactly. It's actually these cases that were here in March April, That's really unusually late. It comes with the migrating birds. And by that time, purchase should have migrated, but maybe some of them have been a bit late. Yes. Okay. All right. And you also said that sort of, of course, we've seen the reopening in Northern Europe to some extent when it comes to Seasoning restrictions on the foodservice or Horiqa business in some markets. Any reflections on sort of Denmark Finland or Benelux or whatever in recent weeks where you've seen easening restrictions? We can see the effect, the positive effect. But also bear in mind that we are now sort of comparing with Same week last year where we had the last time already taking place. So one has to To be careful what you compare with, I think, if you see what we Yes. But if you compare on a sequential basis, if you compare it to sort of March, Are you seeing any difference now in the middle of Q2? Yes. We do anticipate gradual improvement, and we already see the first signs of it. It is a bit different from market to market, But it is clear that these restaurants out of home are less, they are increasingly being allowed to reopen with less and less restrictions. So that is quickly faster. And if we which everyone, of course, expects and hope see a recovery in Hori Eken Foodservice Gradually through Q2 and maybe getting into some bit of a more normal world as we enter H2. Do you still think that sort of retail could be equally strong? Or do you see a backlash when it comes to retail? If you look over time, retail our retail sales have grown with about 6 percent on average per year. It's more or less where we have been through this also. The fundamentals of the preference, particularly in this, exactly the same. It's not even strengthened as far as we see it. The importance of the Sustainable protein, that's even in further enhanced where our chicken comes out very well. So we anticipate that it continued good demand within retail. And one that also had to bear in mind that our ability to eat segments into detail is really gaining ground. And there we are we're quite confident that consumers have now tried these much more convenient, ready to eat products, And they are very good quality, and we see repurchase going on. So well, as pandemic on off, we're quite confident that consumers will Continue to buy these products because they offer high quality convenience that a lot of consumers are really eager to get. Yes. All right. Okay. Maybe a final question regarding the reporting structure. And you make Sort of a quite substantial change from country based to product based, and it's Sort of taking place just before basically half of the Board is changed out. What sort of made you take the decision to do it before the new board is on board? Well, this is something that has been underway for at least 2 years, where a lot of preparation have been going through to ensure that we I have the historical numbers solid, so we can compare and before solid numbers. So this has nothing to do at all with any changes they face to the Board. And so this is something we are we firmly believe in right for the business going forward. And as the business further develops, we believe this The right way to the right lens kind of to look into the business. And also bearing in mind that The dedicated, the country focus remains. That's where the Farmers are, that's where our customers are, that's where the local operations are. So that is fully intact. So this is and other lens to kind of look into the business that we are keen on. Okay. But does it Still requires sort of country managers to be part of top management now that you've changed the structure? Yes. Okay. That's all for me. Thank you, Elias. All right. Thank you. Good questions. We have no further questions on the phone line, so I'll hand back. All right. Thank you, everybody. It took a bit longer, but we wanted to make sure that this Fully explained. And thank you for your time, and thank you for your engagement. Have a super day. Bye bye.