Good morning. I am the Operator for this conference. Welcome to the Geberit Conference Call on the First Information 2020. Please note that for the duration of the presentation, all participants will be in listen only mode, and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. Should anyone need assistance during the conference call, they may signal an operator by pressing star key and zero on their telephone. This call must not be recorded for the location of broadcast. At this time, I would like to turn the conference over to Christian Buhl, CEO, accompanied by Roland Iff, CFO, and Roman Sidler, Head of Corporate Communications and Investor Relations. Please go ahead. Thank you for the introduction. Good morning, ladies and gentlemen. Welcome to our Full Year Sales Conference Call. We will first comment on our fourth quarter sales figures, then review our full year sales performance, followed by our guidance for the financial results in 2020, and finish with an outlook for Geberit this year. I start with the fourth quarter. We recorded another strong quarter with a net sales growth of 6.8% in local currencies, driven by a very strong November and December. The main drivers were no material restrictions for the building construction industry during the second pandemic wave. Second, a strong growth in Germany, supported by the temporary VAT reduction. Third, a buildup of safety stocks of wholesalers during the second pandemic wave, the opposite effect compared to the lockdown wave in spring. Fourthly, pull forward effect in U.K. and Russia due to Brexit and extraordinary currency driven price increase as of January this year. Let me now comment on the development in the various regions in Q4. In Europe, currency adjusted net sales increased by 6.4%. In Germany, net sales grew double digits by 13%, supported by the before mentioned temporary VAT reduction until the end of the year. Switzerland was up 9%, Austria 6%, France 5%, Benelux and the U.K./Ireland up 3%, and Nordic and Eastern Europe both up 2%. The only region with declining sales was Iberia with - 4%. Outside Europe, we increased net sales in Far East Pacific by 16%, driven by very strong growth in China. We achieved a strong growth also of 12% in America, driven by increased demand for electronic faucets. In Middle East Africa, sales were up 1%. The product areas have again developed differently in the fourth quarter. Installation and Flushing Systems grew by 10% and Bathroom Systems by 8%. Piping Systems showed again a much slower growth dynamic with + 2%, indicating to weakening new build segment and project business also during the fourth quarter. I will now comment on the full year 2020 sales performance. Net sales in CHF decreased by 3.1% to CHF 2.99 billion. The sales decrease was driven by a negative currency effect of - 4.4%. In local currency, we managed to increase net sales by 1.3%. We achieved this result despite the COVID-19 crisis hitting also the building industry in the second quarter. The crisis led to a historical sales decline at Geberit in Q2, the weakest quarter for Geberit at least since we got listed at the stock exchange in 1999. However, we managed to compensate this historical decline with a recovery in the second half of the year. Overall, we gained further market shares in 2020. This was also driven by the conscious decision not to reduce our customer presence during this unprecedented crisis, and by the conscious decision to avoid short-term work when demand collapsed in the second quarter. The sales development varied substantially by country depending on the degree and length of the lockdown and the business restrictions imposed on the building construction industry in the second quarter. In markets where construction sites were closed, corresponding to around 20% of our business, sales declined in average by around 10% over the full year 2020. These countries include France with -7%, Italy with -8%, Spain with -13%, the U.K./Ireland with -16%, South Africa with -17%, and India with -24%. The remaining countries were also impacted by lower construction activities during the first lockdown wave in Q2. However, the losses were compensated or even overcompensated again in the second half of the year. We recorded the strongest growth rate of 2020 in our core markets, Germany, Switzerland, and Austria, representing about 50% of our business. In Germany, net sales grew over the whole year by 7%, in Austria by 5%, and in Switzerland by 4%. These growth rates in our core markets confirm our ability to gain market share despite our already strong position and high market shares in these countries. The fastest-growing product area was Bathroom Systems, with a double-digit growth rate in these three core countries. Sales in Eastern Europe and in the Nordics each increased by 3%, with high single-digit growth rates of behind-the-wall flushing systems. Sales in Benelux stayed on previous year's level. The strong growth of 7% in Netherlands was compensated by a decline in Belgium, where construction sites were much heavier restricted than in other countries. In Americas, sales were up by 2%, driven by the strong growth of electronic faucets due to the increased demand for the hygiene-related touchless products as a consequence of COVID-19. Sales in Asia-Pacific declined by -7%, mainly driven by the before-mentioned collapse in India. Sales in China increased over the full year despite the lockdown in the first quarter. Finally, sales in Middle East/Africa decreased by 14%, driven by the before-mentioned decline in South Africa and a difficult environment in the Gulf. Let me now comment on the sales development for product area in 2020, again, in local currencies. Bathroom Systems were up 2.3%, supported by the ceramics business and the strong growth of the shower toilets. Installation and Flushing Systems grew with 2.1%, driven by the disproportionate growth of behind-the-wall flushing systems. Piping Systems declined by 0.8%. The weaker development of Piping Systems was driven by the second half of the year, indicating to a weakening new build segment and weakening project business. We now comment on our guidance for our 2020 financial results. The EBITDA margin for the full year is expected to be around 31%. The substantially improved profitability level is mainly driven by lower raw material prices, not incurred marketing expenses of around CHF 25 million, and CHF 10 million savings of not incurred travel expenses due to the COVID-19 induced business restrictions. The full-year tax rate should reach around 15%, and CapEx is expected to be around CHF 150 million. Before I come to the outlook, let me briefly update you on our share buyback program. Despite the crisis, we continued our share buyback program in 2020. In total, 356,000 shares have been bought back last year. Thereof, 262,000 shares at an average price of CHF 406 under the program launched in June 2017. Under the new program launched in September, additional 94,000 shares were bought back. Let me now comment on our outlook for 2021. Obviously, the uncertainties due to the COVID-19 crisis remain to be very high. The situation around the various lockdowns is changing week by week. The timing for a return to a more normal life cannot be predicted today. As you know, we have a general very low visibility in our business with an order book of less than two weeks. Therefore, we refrain at the moment from providing an outlook for the building construction industry and raw material markets. Let me comment on some of our key business priorities this year. As mentioned before, the COVID-19 related restrictions led to reduced marketing expenses of around CHF 25 million last year. We aim to reverse this effect again this year and to increase marketing spend again on normal pre-COVID levels. To overcome the still existing restrictions for physical marketing events and activities, we will further and significantly shift the marketing mix to more digital activities this year. For example, we will replace physical fairs in the first half of the year by complete digital events, so-called Geberit Innovation Days for our professional customer groups. Another priority this year will be new product launches. Among others, we will introduce a completely new supply piping system called FlowFit, with several benefits and advantages for installers. The third priority this year will be the further expansion of our digitalization efforts with dedicated initiatives in marketing and product, including the buildup of additional IT capacity. In total, we will increase our spending for digital initiatives by another CHF 15 million compared to last year. Let me close our introduction with a short summary. The building construction industry and Geberit have been hit by the COVID-19 crisis, with a historical sales collapse in the second quarter. However, the decline has been compensated in the second half of the year, and we were able to gain further market shares in this crisis year, 2020. At the same time, costs remained on a low level as the COVID-19 induced restrictions did not allow to pursue the business in a normal way. In combination with the normalized sales level, this led to an extraordinary and, under normal circumstances, not repeatable profitability level. The main reasons for these strong results on top and bottom line were a strong financial fundament, a prudent crisis management, avoiding overreactions, our conscious decision not to diminish our customer presence throughout the crisis, and finally, a high flexibility of our organization. It is worth to mention that we achieved these results without restructuring or any people layoffs, without changing our strategic agenda or harming our future potential, without material short-time work, and without financial support from the public sector or taxpayers. The crisis year 2020 has proven the resilience of our strategy and our business model, now also including the ceramics business, the quality and strength of our customer relations, the robustness of our supply chain, our undiminished pricing power, and our ability to generate strong cash flows also during the crisis. Finally, I want to close this introduction with the announcement of a change in the executive board. Roland Iff will retire at the end of this year after being 27 years with the company. Although Roland will remain fully on board until the end of the year, I want to thank him already now for his large contribution to the development of Geberit, especially in his role as CFO over the last 17 years. The search for a successor has been initiated. This is the end of our introduction. We are now ready to answer your questions. As outlined before, we will not answer any questions regarding the outlook of the building construction industry or raw material markets due to the obviously high uncertainty and the lack of visibility. Ladies and gentlemen, we will now begin our question and answer session. If you have a question for our speakers, please dial zero and one on your telephone keypad now to enter the queue. Once your name has been announced, you can ask a question. If you find your question is answered before it is your turn to speak, you can dial zero and two to cancel your question. If you are using speaker equipment today, please lift the handset before making your selection. One moment, please, for the first question. And the first question is from Yves Martrenchar, Exane BNP Paribas. Your line is now open. Please go ahead. Good morning gentlemen, happy new year to all of you. Just a few questions on my side. Number one, I think in the last call, you mentioned that you had about CHF 20 million of brand cost in 2020, but also, I think you had some extraordinary IT spending. I just wanted to check the magnitude of those and whether if you could confirm that any of those costs will be reversing in 2021. Then I guess my second question, I think in the beginning of the call, I didn't necessarily understand completely what you said, but I think you mentioned some extraordinary price increases in January. I just wanted to know if you could comment on those in light of the recent raw material increases that we have seen. Maybe just a last question related to Germany. You mentioned that a lot of the demand came through because of VAT reduction. On the other hand, we've also seen that many households have seen their savings go up quite significantly in 2020, and it looks like in 2021, we're starting the year all at home again. Spending is likely to revert back to the homes. Can you maybe comment on that, and if you're seeing this as a structural effect for the foreseeable future? Although this is really hard to assess at this point, but any color on that would be really key, given the magnitude of the growth you've seen in this market. Thank you very much. Thank you. Question number one, we had extraordinary costs for the brand harmonization in 2019 and 2020, and in each year, we spent CHF 10 million for this brand harmonization. This will not occur anymore as of next year because the brand harmonization is finished. Secondly, we had extra or additional costs last year for increased activities in digitalization of CHF 15 million last year, one five. This will continue this year. On top of that, we will add another CHF 15 million because we are further increasing our efforts in this area. Second question, we made two extraordinary price increases as of January 1st, purely driven by currency devaluation. One country was the U.K. and the other one was Russia. These extraordinary price increases as of January led to a strong pre-buying effect in November and December of last year. The third question, I did not 100% understand. If I understood correctly, you were talking about the home improvement trend in Germany? We see a home improvement trend, not only in Germany, across the countries, that end consumers are investing into their homes, also in their bathroom, and that we are also benefiting from this trend. Yes. Thank you. I guess the question was this, but also, I just wanted to know if the VAT reduction was the main driver for the growth in sales or if you think that that home improvement trend was also a key driver? I'm just trying to figure out of the double-digit growth, which is what? Yes. Home improvement was also a driver. Was the VAT the more important driver? We don't know. VAT played definitely a role, but we do not know the extent of that. We were growing in Bathroom Systems in the second half of the year in Germany, double digits. Thank you very much. You're welcome. The next question is from Daniela Costa, Goldman Sachs. Your line is now open. Please go ahead. Hi. Good morning. Thank you very much for taking my question, and Happy New Year. I have one question. Historically, over time, you've said, you didn't want to have margins which were above 30%. I wondered first if that comment is still valid. At the time you mentioned you would reinvest when margins got above that level. You're now above that level. Can you give us a little bit of color on, if the end markets continue to be strong, what are you going to do in terms of how will you reinvest those margins? You already have returned quite a lot through the dividend and the buyback. How shall we think about what incremental growth can you get from that reinvestment going forward? Thank you. Our target range for the EBITDA margin of 28%-30% is still valid. We don't want to go above the 30%. The reasons that we have been above the 30% last year were basically two. One is we had record low raw material prices. Secondly, as I said during my introduction, we have not been able to spend, especially marketing, as originally planned. We estimate that we have not been able to spend around CHF 25 million last year, and we plan to invest this marketing budget again this year back to a normal level. The last reason was also COVID-19 related restrictions, for example, of traveling, where we have not been able to spend, which we will spend again once the pandemic crisis is over. Okay. The next question is from Martin Hüsler, Zürcher Kantonalbank. Your line Zürcher Kantonalbank. Your line is now open. Please go ahead. Yes. Thank you. I have two questions. First of all, what's your assessment of the new lockdown measures in Switzerland? Are wholesaler shops open, or are only showrooms being closed? What do you expect is the impact, if you compare it to the last year's lockdown in Switzerland? As far as we understand this morning, the showrooms for sanitary products will be closed as of Monday in Switzerland. The business relating to professionals, for example, pickup shops where you can pick up sanitary material, will be open as of next week. That is our current understanding. Therefore, we do not believe that there is a material impact at the moment on our industry, driven by the measures communicated yesterday by the government in Switzerland. Okay. Thank you. Maybe the second one, you don't want to talk about raw material prices. I was just wondering a bit, why are you so cautious about this topic? Because we see movements upwards in the fourth quarter, which should already hit your raw material prices and your purchasing of raw materials. Just why not giving a guidance as usually? Of course, these are two different topics. We are not giving an outlook for the raw material prices, but I'm happy to comment on the recent development, what happened over the last couple of weeks. There you are right. Raw material prices went up substantially over the last couple of weeks, also in January. They went up substantially. To give you a flavor, commodity plastics, important raw material for us, is up 10% in January. Special plastics are even up 20% in January. Steel went up substantially over the last couple of weeks. We expect steel prices in January to be 15%, one five, above the levels of the fourth quarter. We have seen a recent strong increase in raw material prices. The only thing what we don't want to do is to give an outlook for the raw material prices for the next coming weeks and quarters. As you know, we are not hedging our raw material prices. We are exposed to the volatility, and the volatility and uncertainty is high. Okay. Thank you. You're welcome. The next question is from Andre Kukhnin, Credit Suisse. Your line is now open. Please go ahead. Good morning. Thanks very much for taking our questions. I'll just pick up on the last one. Do you plan any further price action beyond what you did effects related in the U.K. and Russia? We plan a regular price increase as of April of around 1%. Is it safe to assume if stock prices stay where they are, you would increase by a higher percentage to offset? At the moment, we do not think about any extraordinary price increases driven by the raw material price developments. Even at the current stock prices? Yes. We're not thinking about extraordinary price increases at the moment. Thank you. If I may just ask on German market, kind of thinking about the discussions we've had over the last few years of kind of market that was constrained by capacity and kind of underlying demand was there, but struggled to grow in full extent, and now it kind of took COVID pandemic for it to grow 7% for you. Do you think there are any learnings there in terms of maybe how plumbers now operate and what they were able to do in the second half of 2020 that can be taken forward? Or was it just kind of restock and extraordinary measures, extra time worked, et cetera? One of the important drivers for our development in Germany last year was that we have been able to gain market share during this crisis. As I said during my introduction, we did not reduce our customer presence. We even intensified our interactions with customers also in Germany. Secondly, we also used some issues of competitors who had delivery issues also in Germany. That was one of the reasons why we have been able to gain market shares. The second one is a general, the fact that Geberit, as you know, in these markets like Germany, but also in Switzerland and Austria, we are growing and outperforming the market largely by our upselling strategy, selling higher value-added products, which do not require substantially more installation time or capacity of installers. The best example, obviously, shower toilets. We have been growing double digits with shower toilets in these markets, also in Germany, and that allows us to gain market share also in these times of constrained capacity of installers. Very clear. Thank you. Maybe just lastly, on the tax rate for 2021, can you comment now already? The tax rate should remain somewhere between 15% and 16%. Great. Thank you very much for your time. The next question is from Remo Rosenau, Helvetische Bank. Your line is now open. Please go ahead. Yes, thank you. Morning. In the Q3 conference call, you were actually quite cautious on the margin for the fourth quarter, already pointing to increasing raw material prices. If I'm not mistaken, you even guided for a potential reduction of the margin year-on-year, not only sequentially. As it turns out, with this 31% EBITDA margin guidance for the full year, it seems that the Q4 EBITDA margin will be around 300 basis points above the prior year. What was responsible for this quite significant better margin development in the fourth quarter compared to your view on the conference call just about three months ago? First of all, you're right. There was one main driver. It was that top line developed much better in November and December than what we expected. Sales went up in November and December of around 11%. We didn't foresee that for various reasons. That is the reason why we are now expecting also a substantially higher EBITDA margin in Q4, driven by the operating leverage of this volume growth in November and December. Okay, great. My second question is, you mentioned the introduction of a new innovation which should benefit the installers in 2021, but I didn't get it really. What is this exactly? It is a new supply piping system. It's for drinking water, basically in buildings. It's a complete new system. It's based, again, on a pressing technology, but it has substantial advantages for installers. It's easier to install, it's safer to install, faster to install, and has other advantages. We will present this new system at our Full Year Conference there in March, also with some pictures, and then you get a better flavor. Okay, great. That's it from my side. Thank you. Thank you. The next question is from Patrick Rafaisz, UBS. Your line is now open. Please go ahead. Thank you. Good morning, everyone. Three questions, please. The first would be, with Q3, you provided us with a comment around the order books at German installers. I believe it was around 12 weeks. Where does this stand now going into 2021? The second question is on the pull-forward effects you mentioned, especially U.K. and Russia. Any chance you can give us an estimate for the magnitude of that? Then lastly, question number three. You explained in detail the marketing expenses and travel expense effects. Can you give us a guidance on how, in terms of timing, how this will ramp up again throughout 2021? I would assume travel expenses will remain low throughout the first quarter, at least, before we start creeping up again. Maybe same for marketing. I'm not sure about digital investments. Any help on that would be great. Thank you. First question, order backlog of German installers. We don't have new information. It's still 12,11 weeks, coming from October last year. The second question, we are not able to quantify the pull-forward effect driven by the extraordinary price increases in the U.K. and Russia as of January. It had a strong growth, obviously, in these two markets, but we can't really quantify. Number three, timing of SG&A costs this year. For travel, you're right. At the moment, we are still not spending travel expenses. That will obviously depend on the question, when we are back to normal business. For marketing, as I said before, we shift substantially our marketing activity to digital, and the digital activities will start already in the first quarter. The Geberit Innovation Day, which I mentioned before, which will be, by the way, a replacement also for the ISH, our important fair in our industry, which will not take place this year in March. These activities will start already the first quarter. Therefore, at the moment, we expect that marketing expenses should be relatively equally distributed over the four quarters this year. Thank you. Very helpful. Thank you. You're welcome. The next question is from Martin Flueckiger, Kepler Cheuvreux. Your line is now open. Please go ahead. Yeah. Morning, gentlemen. Happy New Year from my side. Thanks for taking my question. First one is on AquaClean. Sounds to me like the shower toilet business was up double-digit in Q4. Am I right in my assumption, has anything changed with respect to the targets for AquaClean in 2021? That's my first question. I'll take one at a time. Yes. shower toilets were up double digit in the fourth quarter, no, we don't change our aspirations and business plans. That means double digit also for 2021? Correct. Thanks. That's helpful. Secondly, regarding the search process for the succession of Roland Iff, I was just wondering whether your focus is more on an internal candidate, or whether you're looking for external and new people. What are your thoughts here? That would be helpful. Thanks. Very simple. Our focus is on the best candidate, be it externally or internally. Okay, great. Thanks. The next question is from Christian Koch, HSBC. Your line is now open. Please go ahead. Thank you very much. Good morning, and all the best for 2021, and congratulations on these strong numbers. I have two questions, please. The first one is about new product releases. You talked a little bit about the supply piping system, but is there also something more for, let's say, the front of the wall, like new products in the ceramics business or anything like a design update for existing products? The second question is about the diverging development of the product groups. When we look at the half year results, by then, the Piping Systems business was the one that performed best, and in the second half of 2020, we saw a significant outperformance of Installation and Flushing Systems as well as Bathroom Systems. The trend that we saw in Q3 accelerated in Q4, it seems, and I just wanted to ask you where that comes from. Do you think there was more renovation work done than new construction, for example? Was there any other explanation? Thank you very much. First question, we have also new product launches in the area of Bathroom Systems this year. Let me just mention two of them. One is we will extend our Geberit ONE offering. This new bathroom system we introduced two years ago. 2021 will be phase number two with an extended offering around Geberit ONE. The second example, in front of the wall, we will also introduce a new improved technology around the rim-free toilet. You're aware of the rim-free toilet technology. We have additional or have further improved this technology, and we'll introduce corresponding toilets this year. Second question, the difference between Piping Systems versus Installation and Flushing Systems and Bathroom Systems in the second half of the year. The driver for that is that the new build business and project business has weakened in the second half of the year, most probably triggered by the COVID-19 crisis. Piping Systems have a higher exposure to new build and also project business. That's the reason why they suffered more compared to the other two product areas. Thank you very much. The next question is from Arnaud Lehmann, Bank of America. Thank you very much. Good morning, gentlemen. Two questions on my side. You achieved your guide for 31% EBITDA margin for 2020, a very impressive performance. I think you haven't been there since the Sanitec acquisition a few years back. You've been very helpful highlighting the moving parts in the cost base, including marketing, digitalization, et cetera. On this basis, I guess the message is that the cost base, to some extent, will increase in 2021, including also raw materials. Are you planning any, let's say, cost-cutting initiatives or productivity gains for 2021 to try to compensate for the increase in some of the cost items and try to defend the kind of 30%+ EBITDA margin? That's my first question? Secondly, at this stage, I appreciate it's early days, but are you able to give us any indication on where you expect the net debt to land at the end of 2020? Thank you. We do definitely not plan to cut costs this year. Of course, as usual, we have many projects in the pipeline to improve our productivity as part of our continuous improvement program. We expect also 2021 to improve our efficiency in the various areas, especially, of course, the operation, meaning plants and logistics. The second question, I didn't acoustically understand. Can you repeat the question? Yes. The question was whether you can indicate to us already where you expect the net debt of Geberit to be at the end of 2020, please. We do not provide any further guidance than mentioned in the call, so we do also not give any guidance on net debt levels. Thank you very much. The next question is from Charlie Fehrenbach, AWP. Your line is now open. Please go ahead. Good morning, gentlemen. After the supporting effect of the value-added tax in Germany in Q4 falls apart in Q1, is the assumption wrong that the sales in Germany at least should be lower in Q1 than in Q4? Maybe you can tell us at least this. Thank you. Obviously, the VAT reduction ending end of last year had a positive effect on sales in Q4, but I don't want to make any statement because I don't know if this effect is so big that we will see sales being lower in Q1 compared to Q4. There is an effect, but no one knows, and I don't know how to quantify this effect, therefore, I can't give you a precise answer. Okay, thank you. Maybe a second question, just for my understanding, did you say that the profit level of 31% is not sustainable because of the rising marketing costs in Switzerland, I guess? Yes, exactly, we have just been restricted by COVID-19 in marketing, but also with traveling, of course. If we would have had the opportunity to spend the CHF 25 million marketing, we would have spent last year. You would have spent it, yeah. Okay. It's not sustainable. Clear. Thank you very much. You're welcome. The next question is from John Revill, Reuters. Your line is now open. Please go ahead. I'm afraid we can't hear you at the moment. Perhaps you're still on mute. Good morning. Can you hear me now? You sound very far away. It's very, very quiet. Volume is very low. Could you hear me now? Is that better? Yes. Please go ahead. Sorry about that. Yes. Good morning, gentlemen. Thanks for taking my call. Just a quick question. On currencies, I saw lastly in local currencies, sales went up, but in reported currencies, the sales went down. It's back to the story of the strong Swiss franc again. I wondered, what's your thoughts on the currency situation, and how much of a headache is the Swiss franc for Geberit? Secondly, how does it affect profitability at the company? Linked to this, what plans are there to counter this? You said there's no further price increases in addition to your normal one in April. Is there anything else you can do to deal with it? Thank you. The currency development is not really a headache for Geberit, because we have an almost perfect natural hedge, which means that currency devaluations or changes do not have a material impact on our EBITDA margin. The only headache which could come up is that we would be forced, in terms of sales prices, to adjust our price, for example, in Switzerland. The development at the moment, and also the development last year of the euro versus the Swiss franc, did not trigger any need to adjust our prices in Switzerland. Right. Okay. Maybe one answer is what is very important to us, and we do that constantly long term. We always try to balance our currencies. In many of our projects, we always ask the question, "Does it support our natural currency hedge?" We do that on the long term. If then currencies come down as last year, we benefit from this long-term strategy and thinking. Right. What can explain the situation of why would you be forced to adjust prices in Switzerland? Would you have to cut prices in Switzerland to prevent people going to Germany? What's the mechanics of if you had to do that, but you obviously haven't. What's the mechanics of that? Could you explain? Very simple. If currency-driven cross-border business would go up substantially, we would consider or think about price adjustments, for example, in Switzerland. That is not the case at the moment. Right. Okay. There's no price increases planned for the Eurozone then to tackle the Swiss franc strength at present or in the U.S. because of the dollar decreasing in value substantially. We did two, as I mentioned before, in the U.K. because of the devaluation of the pound, and in Russia because of the strong devaluation last year of the ruble. Nothing planned in addition in Europe or Eurozone or U.S. No. No. Good stuff. Thank you. The next question is from Christian Arnold. Christian, your line is now open. Please go ahead. Yes. Good morning, gentlemen. Thank you for taking my question. First of all, a clarification. You said before that in November and December, you achieved a growth of 11% after a weaker October. This 11%, were you referring to Germany or to the whole group? No, that was the whole group. That was the whole group. Yes. Okay. On Germany, this tremendous Q4 organic growth of 13%. You stated the different reasons. I wonder if you can give us a comment on the inventory levels at wholesalers compared to maybe three months ago, compared to one year ago. Where do we stand here at the inventory levels for Germany especially, but maybe in general as well? In general, we believe, actually, we do not know, but we believe that inventory levels at the end of the year have been rather high at wholesaler level, especially also in Germany. In Germany, due to the VAT effect, but also by the general behavior of wholesalers in the second pandemic wave, which was different to the first pandemic wave. In the first pandemic wave, especially in April, May, wholesalers in general reduced their inventory levels. It seems that in the second pandemic wave, although the construction industry has not been impacted by any large restrictions, wholesalers didn't want to make, let's say, a mistake again and increased inventory levels. That's at least for the year from one or two customers. Yes. Any guess what does it mean for Q1? Again, the same answer as I gave before to Charlie and obviously it's not helpful or not helpful in the sense that if that is true, that would have some negative impact on Q1. The interesting question obviously, what is the amount, the quantification? We do not know. Okay. Next question I have is on the supply chain. Is there any interruption you see, any shortage of electronic components, maybe for shower toilets, et cetera? No, at the moment, we do not have any interruption in supply chain, but it has become very challenging, especially in terms of transportation. Some of the components which we source, especially for shower toilets from Asia, it's not that they are not available. The big challenge at the moment is to find logistic capacity containers to ship these products from Asia to Europe. Prices for shipping containers went up dramatically over the last couple of weeks. At the moment we have all the products we need, but the situation is challenging. Thank you. You're welcome The next question is from Cedar Ekblom, Morgan Stanley. Your line is now open. Please go ahead. Thanks very much. Hi, gentlemen. One question from me. Geberit's strong relationships with your wholesalers and trained installers is key to the market position and revenue growth potential of the business. You're speaking about increasing your digital marketing presence going forward, which is obviously a bit of a shift from the in-person relationship that you've had. Do you think that this can present a bit of risk to the stickiness of your installer or wholesale relationship? No, actually, we think that is an opportunity. If I look at last year, we have been able to increase our contact with customers despite the crisis. Overall, our customer contacts, mainly with installers, went up by 9% last year. That was driven by the shift to much more digital interactions. We tripled the number of digital interactions last year with our customers, and they make around 40% of our interactions have been digital last year. Our second element, which also gives me confidence that we are able to keep or even strengthen our customer relations, still this year with all the restrictions we have, we increased substantially our number of customer trainings last year. Actually, we did more customer trainings last year than the year before, substantially more, because we shifted to digital online training of customers. We trained last year, just as one number, we trained 50,000 customers with digital training tools last year. Great. That's helpful. Thanks very much. You're welcome. The next question is from Marta Bruska, Berenberg. Your line is now open. Please go ahead. Hello, good morning. Thank you for taking my question. I have couple, start it one by one. I was just wondering, if you could give us a little bit more detail on what do you base your statement of the market share gains, especially, that you, at the same time, do not really want to quantify those one-off effects with regard to VAT impacts, to the pricing impacts, to the pre-buying impact, and you don't give us any outlook either. In this context of the extreme lack of visibility as it seems, I would like to know a little bit more on what are you actually base your confidence that you grew or outpace the market, please. Very simple. We do not believe that the building construction market, and especially the sanitary building construction market, has been growing last year. That is the simple observation why we believe we have gained market share. Especially if you go company by company, and of course, also if you compare where we have competitive figures, we are very confident that we have gained market share. You think there was no growth in the sanitary heating and air conditioning industry at all, and the industry association, like for instance, from Germany, it is just not overlapping one-to-one with your market. What's the reason for this discrepancy? Overall, we do not believe that the market for sanitary products in our geographies where we are active has been growing last year. Thank you. I would like to ask you about your digital initiatives, which I think it's very cool you are doing it, and it's quite encouraging to see already 40% of your interactions last year was being digitalized. I heard from other industry players that they had been planning to launch the virtual showroom already last year, fully digitalized in Europe. Have you seen any such a larger move by some of your largest competitors in the region? What do you think of the change in the dynamics in this space? I have one more question only. I don't want to comment on competitors and their marketing activities, but I can comment on our own marketing activities. We also shifted fairs last year to digital showrooms. We reached a substantial number of customers with digital showrooms. For example, in Germany, where we planned originally to be present at a fair, which we then switched to pure online showroom format, which was very much appreciated by customers. We did that as well last year, and I'm confident that this format will also work this year. I mentioned before the Geberit Innovation Day, that will be a kind of a virtual fair for the various professional customer groups we are serving. Okay, thank you. Lastly, with regard to your piping system for the drinking water supply, that has been a very active area for many of your key competitors, in there and for most of the products on the market already, as we've seen with being equipped with fully digital monitoring of the water quality, including like some assistance to probe for the key bacteria and germs in the water in the real time. Does your new piping system has such features? I'm very sorry. Can you rephrase the question? I didn't understand. Yes. I'm asking about the digital monitoring features of your new piping system for the drinking water supply. From the competitors, I have seen real time monitoring of the quality of the water in the piping systems launched on the market over the last three years, and I'm asking what is in your piping system in terms of digital features. There we have to be precise. This is not our business. We are selling pipes, and our competence and products are for the transportation of water. For water management, for example, monitoring, measuring, cleaning, whatever you want to call it, is not the category where we are active. Okay, that's clear. I finish it here. Thank you very much. You're welcome All the best for 2021. Thank you. The next question is from Alessandro Foletti, Octavian. The line is now open. Please go ahead. Yes. Good morning. Thank you for taking my question. I have two questions actually. We have spoken a lot about Germany, but not so much about Switzerland, and the growth rate there was also very strong. Can you explain that growth rate? I think there were two main reasons in Switzerland. One is the before mentioned home improvement trend, which is also taking place in Switzerland. Secondly, we have seen a very strong, nice development of shower toilets in Switzerland over the last year. As you know, shower toilets is a very important category for our business in Switzerland. More relevant in Switzerland than Germany, for instance? I'm sorry, say again? Is that more relevant in Switzerland than in Germany? Share of sales? Yes. Okay. Is there also a similar read across in Austria? Because that was not so stellar, but also quite strong and definitely better than expected in Q4 as well. The same statement for Austria as well. Same drivers. Okay. On all this, if you take Germany, Switzerland, Austria, what's your best guess on how sustainable this growth now is? We heard about stocking, de-stocking, VAT and so on. If you sort of summarize everything in your brain and you say, okay. Yes. How much is sustainable? Yes, it's legendary. There is something in my brain. I'm sure. It's not a crystal ball. It's not a crystal ball in my brain. There is something there, but I don't want to talk about the outlook, as I said during my introduction. We really don't want to talk about the outlook. Coming back to Q4, end of October or beginning November, when we had our Q3 conference call, we expected the Q4 to be weak, but very strong. We have a low visibility, uncertainties are high. Last year was definitely the year with the highest monthly volatility of Geberit's most probably ever. Therefore, we just refrain from talking about the short-term future of our business. Fine. Maybe on last one, we didn't speak about personnel cost development. Do you have an indication on that side? We expect this year, an average wage inflation of around 2% for 2021. Okay. Thank you. You're welcome. The next question is from Martin Flueckiger at Kepler Cheuvreux. Yeah, thanks. Just a quick clarification question. I'm not sure whether I understood you correctly. You were talking about digitization costs of CHF 15 million in 2021. If I remember correctly, you already had CHF 15 million in 2020. What I didn't understand, did you say that there was going to be on top another CHF 15 million, so incrementally now CHF 15 million versus 2020 to 2021? That's my question. This is correct. It's another CHF 15 million, or in other words, compared to a baseline 2019, it's CHF 30 million more now in 2021. Okay. That's what I understood. Thank you so much. The next question is from Manish Beria, Société Générale. Your line is now open. Please go ahead. Yes. Congratulations on very good figures today. I'm very surprised at your margin comments because you are already at 31%. I understand this is at the high point and there is a headwind next year, you also commented, the growth rate in Switzerland, Austria and Germany is also driven by premiumization. I'm just wondering, because you are already at 30%-31% and you'll benefit because of premiumization, some margin benefits from there. How could your margin not be more than 30% over the medium term? As I said before, marketing expenses going up again. Once COVID is over, we will have also normal level of travel expenses. As I also said just before, another CHF 15 million this year or even CHF 30 million compared to pre-COVID for digitalization. Don't forget another point, we have reached record low raw material prices last year, actually, more or less in summer last year. Raw material prices, as I outlined before briefly, have started to grow again and accelerated in terms of growth over the last couple of weeks. Take also that into consideration. We have had last year a historical low level of raw material prices. Is it a fair assumption to make if your shower toilets and the premiumization continues, that will be margin benefit for the company? The growth of shower toilet does not have a substantial material impact on the margins because in potential, the margin is comparable. Okay. Yeah. Thanks. You're welcome. The next question is from Bernd Pomrehn, Bank Vontobel. Your line is now open. Go ahead. Yes. Good morning, gentlemen. The Nordic region is your third largest market, and you achieved an organic growth of 3% in this region last year, which is good, but it is lower than in your core markets, Germany, Switzerland, and Austria. While actually the lockdown in Scandinavia was less severe, the trend towards home improvement is very strong, and your market penetration behind-the-wall still has room for improvement. How confident are you that your combined product offering in Scandinavia will result in higher growth going forward in this region in the coming years? Thank you. We are confident because, as I also indicated in my introduction, for us, important growth driver in the Nordics is behind the wall systems and behind-the-wall flushing systems. These behind-the-wall flushing systems again grew almost double-digit last year. However, the share of this business is still relatively low. This is also the reason why we have not benefited in the same extent from this crisis in the Nordics compared to our core markets to German-speaking countries. We are confident that midterm, we are also able to outperform the markets based on behind the wall systems in the Nordics. Okay. Thank you, Christian. You're welcome. The next question is from John Revill, Reuters. Your line is now open again. Thank you for taking my follow-up. It's just a quick factual question. What was the level of price increases that you did in Russia and Britain in January, could you tell me, please? It differs a bit product by product, but in average around 5% the average in U.K. and also in Russia. Brilliant. Thank you. You're welcome. Thank you. The next question is again from Christian Arnold. Christian, your line is now open again. Yes. Thank you. Question on the product area again. I think in the past, the Installation and Flushing Systems has the highest margins, is a bit ahead of Piping Systems and Bathroom Systems. I wonder, having all this integration work done with Sanitec, all the brand out phasing done with Sanitec, and also the strong growth in Bathroom Systems coming from shower toilet. Is it a fair assumption that Bathroom Systems now has a very similar profitability compared to Installation and Flushing Systems? No, this is not the case. The margin is still lower from Bathroom Systems compared to Installation and Flushing Systems, and we do also not expect that that will change short or mid-term. Okay. Similar to piping? Still similar? Similar. Yes. Okay. Just a brief technical question on CapEx. What do you expect for 2021, 2022? 2021, we have a budget of around CHF 180 million. Higher than last year. We expect last year to be finally at around CHF 150 million. Also in terms of investments, we have been restricted by COVID-19. We wanted to spend more, some delays due to the COVID-19 restrictions. This year we plan and hope that we can invest again on a normal level of CHF 180 million. In 2022? We don't know yet, but mid-term, we expect around 6% of our net sales to be invested into CapEx. Thank you. You're welcome. This concludes the Q&A session, and I hand back to the speakers for closing remarks. Thank you for your interest. We wish you all a good day, and see or hear you most probably at our full year conference mid-March. Thank you. Ladies and gentlemen, thank you for your attendance. This call has been concluded. You may disconnect now.