Good morning, everyone. Welcome to the conference call for Pandora's First Quarter R esults for 2023. I'm Bilal Aziz from the investor relations team. I'm joined here by our CEO, Alexander Lacik, CFO, Anders Boyer, and the IR team. As usual, there will be a Q&A session at the end of the call. If you could kindly limit yourself to two questions at a time, then that would be great. Please pay notice to the disclaimer on slide two. Turn to slide three. I will now turn over to Alexander. Thank you, Bilal, and welcome everyone. Let me start by sharing some key highlights from our first quarter. As you all know, the macroeconomic environment continues to remain challenging with consumers still under pressure. Despite this, we've just delivered yet another quarter which demonstrates our resiliency. The organic growth ended at +1 with our like-for-like flat. Underpinning this is our relentless execution of the Phoenix strategy. We've seen good progress on our key strategic initiatives. Worth highlighting is the strong growth of our Timeless and Pandora ME platforms. We also continued to complement this further through positive growth from our recent store openings, all of which are already accretive to both sales and EBIT. Given this value creation, we continue to see ample opportunity here for this year and beyond. You shouldn't be surprised to hear that profitability remains strong. Our gross margins continue to be rock solid and were helped by positive impact from our pricing actions taken at the end of last year. We see this as an important milestone for the brand and we'll talk more about this later on. The cash profile of the business remains structurally attractive. We remain firm on our commitment to return the highest ever cash distribution back to shareholders this year. Let's move to slide four, please. Looking into the remainder of 2023, we remain confident of our prospects, equally mindful of the ongoing macroeconomic uncertainty. We've started the year well, therefore have updated our organic growth guidance to -2% to +3%, with the EBIT margin guidance unchanged at around 25%. The lower end of the organic growth range would require a notably weaker economic backdrop than what we see today. We appreciate that this is still a relatively wide revenue range. It's still early in the year, and we will continue to update you here as we move through the year. A few words on current trading. So far in Q2, we've seen our underlying trading to be broadly consistent with what we saw in Q1. I want to remind you that we are only four weeks in. The environment remains uncertain and Q2 trading is concentrated around Mother's Day, which is still ahead of us. Nonetheless, we continue to be pleased with the underlying health of the business. Let's move to slide six, please. Before we go into the Q1 details, let's take a step back and look at exactly what we're trying to build here at Pandora. In a nutshell, it is to be the largest and most desirable jewelry brand in the world. Underpinning this is our execution of the four growth pillars of our Phoenix strategy. This covers driving a strong brand, leading in design, expanding our reach in core markets, and driving personalization. I'll take you through in detail some of our initiatives in the coming slides. I wanted to reiterate that everything we do really stems from Phoenix. Next slide, please. One aspect of a strong and desirable brand is to offer a sharp value proposition. At the end of the last year, we successfully adjusted our prices to offset some of the inflationary pressures we, like others, have experienced. To remind you a bit about the journey we've been on here, in 2019 and 20, we went through a major promotional detox of the group that indirectly raised our prices, shifting more of our business into full price. Early last year, we appointed a specialist pricing team. They were tasked with carrying out a comprehensive pricing analysis across the group. After extensive modeling and live testing, we decided to move forward. We rolled out the global price adjustments in Q4 of last year. It's important to highlight that we protected both strategic as well as opening price points. Since then, we've seen a broadly neutral impact to group revenues and a positive impact to our margin. This has been a good journey for us. We remain mindful of the current pressure on consumers and staying true to the brand promise of offering affordable jewelry. We certainly see further opportunities here. It's too early to say how much or when, but we will continue to be guided by the data and are confident we can stretch our pricing architecture further. Next slide, please. It's imperative that we continue to bring relevant consumer innovation in general, but to the Moments platform in particular. In January, we launched a new design of the iconic Pandora bracelet, the Studded Chain. This has been developed by our in-house design group and is unique for Pandora. It offers a totally different texture and shine versus our previous bracelets. The design came nearly 20 years after Pandora's initial snake chain bracelet, which resonates very strongly with consumers still today. I'm happy to report that the new carrier bracelet has started very well. It has driven good incremental growth for our overall bracelets, and there is a very strong consumer pull of this new design. This demonstrates our ability to build out our Moments platform for the long term. We know when we sell more bracelets, the consumers will come back to us for the charms. This unique captive business model is what puts us at a big advantage versus the rest of the jewelry market, as it secures a highly profitable and recurring revenue stream to our biggest platform. During the quarter, our base Pandora Moments business continued to perform strongly. Overall growth was slightly down, but this reflected some weakness in newer charms. With the new bracelet underpinning growth, we remain confident ahead. Next slide, please. As part of our Phoenix strategy, we continue to extend our offering as a brand across different platforms. It's good to see some encouraging results here. Pandora ME has had a strong start to the year at +21% like-for-like growth. This was relatively broad-based. We optimized the assortment last year and execution has improved across many countries. It's a good example of our continued investments and learnings paying off. Timeless, which is our second-biggest platform, has also had a strong start to the year at plus 11 like-for-like. This was broad-based and helped by better execution and a strong Valentine's Day offering. I also want to highlight that Timeless acts as a powerful platform in attracting new customers into the brand. Our internal data here shows that our entry-level rings are opening up new consumers for us. We can take them through the entire brand journey and retain them for a long time. Finally, performance in diamonds was stable and in line with our expectations. We continue to learn a lot here and see this as a big opportunity to transform the brand. We can see from the data that the consumer appetite for a lab-grown diamond offering is certainly there. During this year, we will expand our assortment to offer more classical ranges and continue with our plans for further geographical expansion. We will also ramp up our marketing efforts here to drive greater consumer awareness. Next slide, please. Let's have a closer look at the specifics of the quarter. Organic growth was plus one, while like-for-like was flat. Underlying trading was broadly stable through the quarter. We are pleased with this continued resiliency of the group. As I'm sure you're all aware by now, the macroeconomic environment continues to be uncertain, with consumers under pressure. We have seen some pockets of weakness in some of our markets, but the core of the group remains stable and has been so for four straight quarters. This stability speaks to two things. First, we continue to invest into the brand to ensure we're at the front and center of consumers' minds. Secondly, a diversified geo-footprint remains a key pillar of strength. We believe we can continue to lift the structural penetration of the brand higher in pretty much most of our core markets still. Let's move on to the next slide to take a detailed look into the growth for the first quarter in some of our key markets. Let's start with our biggest market, the U.S., which delivered minus 7% like-for-like. This was in line with the previous quarter, but was impacted by some signs of greater consumer hesitancy with conversion rates slightly down. Looking at the performance a bit deeper, our performance improved sequentially in our owned and operated stores, but was offset by weaker performance in the franchise channel. We are indeed looking at ways of helping our franchise partners to improve their performance. As I mentioned previously, we will be expanding our offering in diamonds in Q3, also expand our rollout across more stores in the U.S. We are confident this will bring incremental growth later on in the year. Next slide, please. The performance in our key European markets improved to flat like-for-like. This was helped by a small improvement in most of the markets. Germany was very strong at +11% and saw solid growth across all platforms. We continue to see a long runway ahead in this market for the brand. The U.K. remained resilient despite the weak consumer backdrop. Italy and France saw small sequential improvement, although remain soft given the macroeconomic backdrop. In Italy, while early days, we've noted slow improvements in the underlying trends. Next slide, please. In Australia, our performance delivered -5% like-for-like, which was impacted by the weak consumer sentiment. I'll touch on China in detail on the next slide, but on a high level, our performance improved through the quarter in line with the economy reopening. We've seen a sequential improvement in traffic. I want to highlight this a gradual return, but it's encouraging to see the positive trends continue. In fact, our April like-for-like growth is now positive, albeit of course, over a rather weak base. In rest of Pandora, we continue to see strong growth driven by many markets. Mexico continued to stand out at +15%, and Spain also continued to remain solid at +8%. There was also strong double-digit like-for-like contributions from many other countries such as Portugal, Brazil, Turkey, and Poland, to mention a few. Next slide, please. Coming back to China. After three years of COVID-related disruption, I'm happy to report that we are getting closer to the brand relaunch later this year. China has been a drag on the group like-for-like growth since 2020, and we now see an opportunity to turn the table. As we said previously, this will be more of a selected and gradual relaunch on a city-by-city basis. We look to see what we learn in each city and take it forward from there. We believe the brand historically has not had the correct focus. The first priority will be to reposition the brand and ensure we portray the core values. This will focus on Pandora's unique proposition, how to express yourself through our Moments platform. Another important aspect will be to invest sufficiently in media to drive awareness and finally meet customers in our channels with the correct sales narrative and storytelling. One important criteria for this effort to be successful is that traffic into stores significantly steps up from where we are today, or else it becomes challenging to ensure the right ROI. Next slide, please. I wanted to remind you again of the significant value we create from our network expansion. We saw 3% organic growth contribution in Q1 from network additions carried out over the past year. This follows from already 3% we delivered last year. We will continue to push forward here this year as we target to open an additional 50-100 new concept stores and a further 50-100 shopping shops/kiosks. Given the macroeconomic situation, we have the option to keep momentum here as access to good locations could open up. Our midterm ambition has been to open stores in the best 600 locations that we previously mapped in 2021. You can see on this slide the type of financial impact that would have on our numbers. We don't think the story stops there. We continue to see further opportunity to expand the store network in areas where we don't have a Pandora store today. We'll update you later in the year on our plans to take this further. Next slide, please. Finally, I'm happy to report that after two years of extensive testing, we opened doors last month to our brand-new store concept, Evoke 2.0, in Italy. This is an important milestone in our evolution as a brand. The concept elevates the desirability of the brand and allows greater consumer engagement across all of Pandora's platforms. It's effectively a total redesign internally, and I'm confident this will mark a step change in the way consumers engage with the Pandora brand. We'll be rolling out more than 40 new store concepts this year, most of them major cities in our core markets. On that note, I hand over to Anders for a closer look at the numbers. Thank you, Alexander. Good morning or good afternoon, everyone. Please turn to slide 18. The key takeaway from a financial perspective for the quarter was that performance was stable on the top line despite the macroeconomic situation, and our profitability remains strong. I'll comment on revenue and EBIT on the following slide. Here on slide 18 I'll just pick out some of the other KPIs as usual. Our gross margin continues to strengthen and increased 150 basis points to 77.5% in Q1. This is a continuation of the upward trends that we've been seeing during the past few years. The gross margin in the quarter includes a drag of 70 basis points from foreign exchange and commodities, but the underlying drivers continue to be strong, and there's a positive impact from our pricing actions that is also in the gross margin this quarter. As you will remember, we decided to increase inventories last year during 2022, and this is why you see the working capital being higher on a year-over-year basis. On a sequential basis, our inventory levels are broadly flat. For the full year of 2023, we also expect inventories to be broadly flat, in line with what we communicated back in the at the full year announcement in February. Finally, I'll just mention that the slight increase in leverage, net interest bearing debt to EBITDA, reflects the higher shareholder distributions which we decided to pay out in order to move up from the low end of our capital structure policy range by year-end to around the midpoint of the range. Go to slide 19, please. Here we'll have a look at the revenue performance in the quarter. Organic growth came in at 1% as, for the quarter, as Alexander already said, but let me take you through a couple of the building blocks here in the bridge. First of all, like-for-like growth was flat in the quarter, this was in line with the underlying level back in Q4, and it's in line with the high end of the guidance that we have for the full year of 2023. Secondly, we saw another quarter with solid contribution of three points of growth from network expansions. Just repeating what Alexander also said, I'll do that again, but it doesn't just drive top line, but also bottom line in our P&L. As you can see in the pink bar in the bridge here, this growth was offset by the impact from the phasing of selling of -2 points, which is mainly a reversal of the positive impact we saw in Q4 of last year. This impact, phasing impact, is mainly something that we expect to see here in Q1, and that also means that we will see the network impact being more visible in the reported organic growth already here in the second quarter of the year. Then go to slide 20, please. This is the EBIT margin, and on the EBIT margin, the conclusion is that profitability remains solid and in line with our expectations, with all underlying drivers progressing as planned. As a reminder of what we said in connection with the full year announcement, the EBIT margin in the first quarters of the year are expected to be below 2022, and then Q4 will be above 2022, and then with the full year broadly in line with last year. That's, that's also what we see here in Q1. In the underlying margin in Q1, that is what we, as usual, have in the, in the dotted box in the middle of the, of the bridge. We saw positive impact from the network expansion and the price increases, and this was then offset by the planned investments in Phoenix, and the phasing of costs that we had expected this year. The, the reported EBIT margin was also impacted by the selling phasing impact that I mentioned on the previous slides. Overall, our underlying profitability, and the, and the drivers remain unchanged and strong. Now let's go to slide 22 and the guidance. As Alexander mentioned, we have updated our financial guidance slightly. Let me just quickly remind you of our thinking and where we stand today. We've started the year well with a flat like-for-like, and current trading remains in line with that, and thereby, at the high end of our guidance. It's still early on in the year, and the macroeconomic environment remains uncertain. Based on those two factors, we've decided to update slightly the financial guidance for organic growth to -2% to +3%, and thereby lifting the low end of the guidance from previously -3%. As you can see in the bricks here, the updated guidance corresponds to a like-for-like growth of between -4% and flattish for the full year. The question that you may ask then is that, but this then means that Pandora guides that at best like-for-like growth remained flat, and isn't there a case where like-for-like is positive in 2023, question mark? There's, there's two points here that we would like to mention. First of all, the low end of our guidance would require a notable worsening of macro and trading conditions during the remaining part of 2023. Macroeconomic certainty certainly is still there. It's still early on in the year, and let's see where macro environment goes in the remaining part of the year. Secondly, if we put macro conditions aside for now and then just look at our internal plans in both the short term and the longer term, then we have great confidence that we can grow Pandora at good like-for-like levels and even higher organically due to the network expansion. We already said that back at the CMD in 2021, and we'll talk more about that at the CMD in October in London. In the short term, however, macro conditions, that's a fact, are likely to continue to wait on our like-for-like performance, and that's essentially what our guidance is saying. Please go to slide 23 and the EBIT margin guidance. It's unchanged at around 25%. We started Q1 in line with our expectations, exactly as we said at the full year announcement, and we are on track to deliver broadly flat EBIT margin versus last year for the full year. As a reminder, the guidance this year includes an extra element of flexibility, as we've called it, and that in short, that means that if macro hits harder and growth land towards the lower end of the guidance, then we will take cost actions that can keep the margin around 25%. On the other hand, if growth lands towards the upper end of the guidance, we still have the flexibility to invest even more in future growth if we decide to do that. That principle that we outlined at the beginning of the year still holds. On this slide, we have laid out the building blocks for the margin guidance again, and they are broadly unchanged versus what we presented in connection with the full year announcement back in February. With that, I'll hand it back to Alexander and slide 24. Thank you, Anders. To conclude, we are very pleased with how we've started the year. I think we've proven that over the past four quarters, we know how to navigate uncertain times through our strong brand and unique captive business model. As Anders said, the environment remains uncertain ahead, we will continue with a prudent approach in managing our cost base whilst not compromising on major strategic objectives. We look ahead to the rest of the year with confidence. Next slide, please. Before we open up for the Q&A, I want to make a little bit of advertising and remind you of our capital markets day in London that's coming up on October five. We hope to see you all there for an exciting program and a great dialogue. You won't regret coming. Anyways, with that said, please open up the Q&A. Thank you. If you do wish to ask a question, please press five star on your telephone keypad. To withdraw it, please press five star again. We'll have a brief pause while questions are being registered. The first question will be from the line of Grace Smalley from Morgan Stanley. Please go ahead. Your line will now be unmuted. Hi. Good morning. Thank you for taking my questions. I have three, please. Firstly, on the current trading of the flat like-for-like that you've seen in Q2 to date, could you elaborate more on what you're seeing by region within that? Secondly, on pricing, I think you mentioned that you see further opportunity for price increases going forward. Could you maybe elaborate on what we should expect there, what you've seen on the price increases to date that gives you confidence that there's more opportunities for price increases in the future? Also, if we continue to see silver prices rise, would you look to use price increases as a potential margin offset going into next year? Lastly, just on gross margin, as we look at the gross margin, through the rest of the year, should we expect a similar kind of strong performance as to what we saw in Q1? Thank you very much. Yeah. Hi, Grace. I can take the first and then probably the third question as well. We'll not go too deep into the current trading by region. I think what we can say is that there's no structural shifts compared to where we've seen what we've seen in Q1 overall, apart from China, but we've already mentioned that in the announcement this morning that since late March, China has been in plus compared to the double-digit negative that we saw in Q1. Apart from China, there's no changes across regions, broadly speaking. Maybe I can take gross margin as we speak. I think you should expect the gross margin to keep holding up and growing year-over-year. We will continue having some tailwind on the silver prices. Actually a bit more on tailwind on the silver prices as we go through the year, given that we've hedged all of the year already. The 77.5% that we delivered in Q1 is a good way to think about the remaining part of the year. On the pricing, just take a step back. Contrary to kind of the high-end luxury brands that use pricing as a revenue driver, this was not the intention when we did our pricing action. Also the modeling and testing we did suggested that there would be a elasticity around the 1.0 mark, which is kind of what's bearing out. We retained the upside on the margin side, of course. We are ending up with a structurally higher profitability on those items. That's the 4% that on average that we took in Q4. Going forward, what we said is we will continue to be vigilant around the affordability aspect of our brand. Pricing will be used mainly, if not only, as a means to offset cost inflation in when it's hitting us. There might be some scope to consider this going forward. There's nothing in the plans as we sit here today. Then on the silver price, I mean, In a way, we hedge the rolling 12-month hedge, so that's a way to somehow manage this. Of course it depends entirely on where silver price goes. If, you know, silver price goes north of 30, $30 per ounce, I'm sure we'll have a different point of view. Right now, that's not really on the cards. I think it's mainly for other aspects of the business where we see cost price increases coming through. Yeah. That's kind of the view on pricing. Perfect. Thank you very much. Thank you, Grace. The next question will be from the line of Kristian Godiksen from SEB. Please go ahead. Your line will now be unmuted. Hi. Thank you, guys. I'll start with the two questions. First of all, can you comment a bit and give some color on the difference in performance between the retail and franchise stores you see across regions? What are the underlying reasons, and could this trigger more acquisitions/takeovers? Secondly, you mentioned that network growth continued with strong margins. Can you elaborate a bit on the margin impact from the network growth, maybe do that in time stages? What are the full margin for, let's say, an average store that has been open for a year? Or when do the stores reach this 40% full margins you also mentioned? Thank you. I'll pick off the first one. What we have, if you go back a couple of years, then I think it's fair to say that the franchisees performed a bit better than our ONO. If, you know, a little bit closer in, I think we've kind of leveled that playing field, and now it's kind of, the delta is starting to spread in the other direction, where our ONO in general are, you know, driving like for like a bit stronger than the franchise partners. That's kind of just so you understand the performance history. The key driver right now seem to be one of two things or both. It depends a little bit on where we are in the world. Typically, we can see that the level of inventory and the quality of that inventory is a little bit lower than what we see in our own stores. That's one aspect. The other one is, of course, as things are a little bit tighter around the world, we can also see that the number of staff hours that we put in is, you know, more on the positive side of things, which means you secure conversion rates stronger. Those are probably the two main drivers. Then there's a whole array of other topical things in between, but those will be the two main points. And we're trying to now work through with the franchise partners, where we can and where there's room for that conversation to at least address the inventory position. Staff hours, of course, it's a discretionary decision by the franchisee. We're just trying to point out where we think that they're leaving money on the table. And in some cases that looks like it's meaningful money that's being left behind. I think that's kind of the commercial view. Then maybe, Anders, you can talk a bit about the network question. Yeah. Thanks for the question on the network question. The in general, the ramp up is quite fast on the bottom line. We have stores that are almost instantly at full run rate, normal run rate. Some others that takes sort of towards a year. Across all stores, they are all as a minimum margin neutral for the group, even in year one, meaning 25% or above, with some even being closer to the 40% that you mentioned already in year one. The differences in the ramp up depends a number of factors, including so what's the strengths of the brand obviously in the area? Do we have a brand awareness in the area already or is opening up the store in that city, on that street, is that part of building up brand awareness? The other important factor is, can we get colleagues in the stores, store manager or the sales colleagues that know about the brand already or are we hiring so someone that coming from the outside, that also has a clear link to how fast we are ramping up. Margin, slightly margin accretive to the group already in year one, which obviously a kind of a luxury situation to be in. Yes, definitely. Can I just ask a follow-up on that? When you say year one, and it's just to be sure it's the first 12 months, right? It's not the end of the year. It's not the Yeah. It's a run rate for the first 12 months, not after 12 months. You're right. Exactly. Okay. I think on the stores, when you are in dialogue with the franchisees on the performance, you didn't mention whether that could trigger any more acquisitions or takeovers. I mean, nothing has changed in that respect, you know, in our network strategy. You know, they are our partners. If there's a contract in place, we both part adhere to it. That there's no trigger point in the contract just because there are a couple of points like-for-like behind. This is, you know, it's a commercial business conversation that we're having. Yeah. Sorry. When you comment like-for-like points, is it also the same for the revenue per store? Is that the? Obviously it depends on where the base was. The revenue per store is also on a like-for-like basis, higher for your stores compared to franchisee stores? There's no generic answer to that. It depends very much on where we are, in the world. Typically, and, you know, Pandora started out as a franchise business, so, in some markets our partners have the very good locations. In other markets that where revenue per store is higher. The I think on actually on average, the revenue per store is probably a touch higher for the partner stores than our own stores across the world. But it's yeah, it's for different reasons, so to speak. Yeah. Okay. Makes sense. Thanks a lot. Thank you, Kristian. The next question will be from the line of Michael Vitfell-Rasmussen from Danske Bank. Please go ahead. Your line will now be unmuted. Yeah. Thank you very much. Well guys, well done, guys, on navigating in very challenging waters. Two questions from my side also. First of all, can you just add a few more details on why you think you did so particularly well when you look to markets such as Germany, Mexico, and Spain? Also if this is the case, if you strip out, I think you mentioned easy comps on Germany, and I think also there were some store opening impacts from Mexico, just to get a kind of thinking in terms of the underlying growth and also if this is obviously something which is going to continue? If you could add also some further comments on the U.S. market, and here I'm in particularly thinking about the conversion rate weakness that you have seen. I obviously understand that it's probably different across store types, but maybe if you could talk about also geographies or states in the U.S., any particular areas that you see weaker or better from that sense. Thank you. What are we doing in Germany, Mexico, and Spain? I mean, okay. Germany, we, this is now a ongoing saga. It's been running strong now for the last two plus years. We changed a bit the model. I think we have a very strong management team in place. There's no kind of magic bullet in this. I think what's different there, what they managed to do is to put, you know, have a marketing plan which is more of a what the larger markets can afford, i.e. to be always on versus if you're small in our network, then typically you only have, you know, let's say decent marketing muscle around the key consumption periods being Valentine's, Mother's Day, and Christmas, and then there's not so much activity in the periods in between. That's what we managed to do in Germany. We managed to plug that so there's kind of an ongoing activity. It's not all TV advertising, it's more social and other channels, but that, you know, that is I think is the key driver of the German of what let's say what's different in Germany. Mexico, I think it's also been on a massive growth journey that's both been driven by like-for-like as well as organic growth. Nothing really new there. They will just keep kind of working their way through that also with decent support levels and a strong activation by the store network. Spain, in fact, is one of our strongest countries in terms if I look at the brand equity. It's pretty much the same story there. We've done a very, very good job. We've cleaned up the network in the last few years. We had a, you know, a fair amount of underperforming in particular multi-brand stores. We've taken over the shopping shops in El Corte Inglés, which is like 20% of the business. We put our own people in there, we manage the merchandise, and we can see very, very strong response by the customers. Actually, El Corte Inglés also acts as a portal into not just our brand, but many, many brands. If you do well there, it kind of opens up the brand for the brand journey to continue. I think those are kind of the main points in those geographies. I'm not sure I understood. There was a question under that. Maybe you can repeat that. Sorry. Yeah, just on the conversion rate in the U.S., any particular areas that you see do better or worse and if you could just add a bit more flavor on that? Yeah. I mean, in general when we look at the U.S., we don't see major discrepancies on the performance. We have been a bit weaker on the West Coast when this was run by the franchise partner which we had there. We've taken that back. This is not massive. It kind of follows that the awareness of the brand is a bit lower on the West Coast than what we see on the East Coast as an example. Other than that, there's nothing, no major difference. It's not like if you look at Europe and you're performing, you know, bad in Greece and great in Sweden. We don't have those type of. It's a more, the marketing program and the go-to-market is a national program in the U.S. Conversion rates, what we've seen, I'm just looking up here. Conversion rates. I mean, it's, we have. If you look at the ONO for the quarter in the U.S., traffic is actually up double-digit. The conversion rate is, it's at a high level, but it's down a touch. Part of that conversion rate, when traffic goes up arithmetically or conversion goes down. We don't really have a good formula to understand exactly how this correlation works, because in different periods of the year it behaves differently. What I see, though, is that there's a delta between us and the franchisees, for instance, where our conversion is higher than they are, and that comes back to the comment I made prior on staff hours and maybe not having the right merchandise. That probably is the main part that would explain it. That's as much as I can kind of see. If I look at the basket size and average selling price and units per transaction, we tend to be similar between us and the franchisee. It's really a, it's a conversion game more than anything else. Okay, great. Thanks for clarifying that, Alexander. Thank you, Michael. The next question will be from the line of Chiara Battistini from J.P. Morgan. Please go ahead. Your line will be unmuted. Hello. Hi. Thank you for taking my questions. The first one is on your marketing spend, which was down in Q1. I know the base was quite high from last year, but I was wondering if you could update us on your views on marketing spend for this year, notably in context of more product launches in the second half of the year, the China brand reset. Any updated thoughts there? The second question is on Evoke, the new store concept. I was wondering if you could share any initial KPIs or any evidence of what you've seen and experienced with this new KPI. Finally, a question on how you see gifting and the resiliency of gifting. Historically you've always mentioned that you see gifting as a more resilient segment within jewelry. Now you're talking about some pressure on conversions in the U.S. You've talked about in the release about trading down in the U.K. I was wondering whether you could tell us more on how you see gifting performing right now and your outlook for gifting for the year. Thank you. Okay. The marketing spend for the quarter was a touchdown. If I look at what that buys me is pretty much on par with what we got last year. The reason and the delta in between is that we've done a media tender during last year, which was very successful. From a consumer feeling the brand, it's literally speaking is the same. There's no difference there. I can also see this in other metrics that we look at. For the guidance of the year, we're still in that 13%-15% range for the full year. Nothing there has really changed much. On the Evoke 2.0, we opened the doors last week. I think it might be a touch early to comment on that specific store, which is in Italy. Prior to that, we've had a previous iteration of Evoke. This is now the Evoke 2.0 that we opened last week, which when you'll have an opportunity to see, this is a little bit different in the look and feel. You know, we typically performed ahead of the comparative marketplace, which could be a region typically or comparable stores on that concept with a couple of points in sell-out growth. That's kind of what makes us quite confident that we know we have something good in our hand. On gifting, we've done some research on this. Actually, we don't see a major sentiment shift from consumers in terms of gifting. It may vary a bit between the three gifting moments, you know, Valentine's, Mother's Day, and Christmas. Christmas obviously being the strongest for the jewelry category. Mother's Day, we see very much at least this. Of course, these are claimed responses from our customers, but we see that it's kind of literally on par with what we've seen prior years. That probably speaks again to the point of us remaining rather resilient in the moment of gifting. We're just entering Mother's Day, so I don't have any date on that. We'll talk about that when we speak in August. Our Valentine's Day performance was actually very good, which again, just again, kind of, proves the point somehow that gifting is a point in the year where Pandora seems to excel. So that would be the point I say. Great. Thank you very much. Thank you, Clara. The next question will be from the line of Klaus Kehl from Nykredit. Please go ahead. Your line will now be. Yes, hello. Two questions from my side. The first question is about the current trading. Just to be perfectly clear about what you are saying about the start here of Q2, is that we should expect like-for-like in the range of 0%-3% growth from a network expansion, meaning that you are seeing an organic growth in the range of 3% here in April. Is that the way to understand it all? Will there be an impact from a sell in again here in Q2? That's my first question. Secondly, you have a negative like-for-like growth of 26% in China here in Q1, but you mentioned that things are starting to turn around. Could you please be more specific about what you're seeing here in April? That would be my questions. Thank you. Hi, Klaus. It's Anders here. Maybe I can start with the current trading piece. You're right. If we close the quarter now, second quarter now and looked at our underlying like-for-like trend, we would be at around 3% organic growth given that we have the network expansion on top. In other words, yeah, we don't expect any significant sell in phasing either way, neither positive or negative here in the second quarter. Yeah. On, on China, what you can say is sequentially as traffic starts increasing, that is starting to trickle through in our numbers. You know, each month is a little bit better than the prior, broadly speaking. Of course, then between January and February, if you wanna get really into the details, there was a shift, calendar shift where Chinese New Year's fell last year. You would have to look at the two combined somehow. Coming into April, we're actually in positive territory when it comes to like-for-like. The traffic is coming through the system somehow. I should also mention again that it's at rather low levels still versus the pre-pandemic situation. We still have, you know, you know, some ways to go before we're back into to a similar territory that we were before the pandemic. could you comment on the level of like-for-like growth here in April? Are we talking about 5%, 10%, 20%? Just a ballpark figure. I think the only thing we can say, Klaus, is that if it had been 2% or 5%, I think we wouldn't have called it out. It has to be, of course, something that is a nice double-digit number. As Alexander said, that was a significant lockdowns last year. Still, even though it's an easy comparable, it's still a double-digit positive number. Long, long-- that's the, that's the first time for some time we see that. It all, it all, it all helps. Thank you very much. Thank you, Klaus. The next question will be from the line of Lars Topholm from Carnegie. Please go ahead. Your line will now be unmuted. Yes, congrats with what I thought was a solid quarter. A couple of questions for me. One goes to your guidance for like-for-like of -4% to 0%. As I think in your comments when you presented, you said the low end of that range would require significant deterioration in the macro climate. I wonder, isn't that also the case for the high end? If your run rate is zero now, that's the high end of your guidance range. Your comps will clearly become easier as the year goes on. If China, even though it's a small part of sales, goes from -40%, -50%, -60% to +double digits, that should incrementally add a couple of% to sell outgrow. I just wonder how you end at 0%, unless the high end also includes a deterioration in the underlying market. That's really my first question, trying to understand why that zero shouldn't be a positive number. Second question, goes to the overall market in particular U.S. and U.K. Based on the intelligence you have to the extent it is relevant, how was Pandora's performance relative to the market? Was it better, was it broadly in line, or was it worse? Thanks. Yeah, hi, Lars. Thank you for that question. I think that that's a well framed question. You are right that comps are getting easier as we move along in 2023. We started to seeing some macro impact already in early Q3 of last year, starting out in mainly in Italy. As moving on into the back half of 2022, more countries being impacted by macro. China should go from a drag to as a minimum flat, that's actually what the guidance assumes that we at least stop the drag from China in the second half of the year. You might call that our conservative. There's clearly a chance that China could add to revenue growth in the second half of the year. Given the past that we've seen the last couple of years, we don't wanna bake that into the guidance. Even though it's a small share of revenue that could be an upside. Let's see. In a way, I guess you're right in the way that you frame it, that in order to remain at around 0% like-for-like then you should even there see a slight worsening on the impact of on consumers. If we listening to what the sort of the macro experts are saying, that's kind of also how we see it, saying that there is a delayed effect on higher interest rates, mortgage rates, inflation, a delayed impact before it really hits through on on consumers. Again, we're not we have been trading around this level for some time now. We're not we're not seeing trading at this point in time below the high end of the guidance. We are at the high end of the guidance. The way we think about it is that we like to plan out the year, making sure that we have set the cost space to make sure that it. If it's gonna be a difficult year, then we are prepared for that. If that doesn't happen, it's always easier to scale up than down. It is early in the year, Q1 so far so good. Let's see Q2. April is a fairly small month in Q2 actually. It's about Mother's Day that's coming soon in the next couple of weeks. Then when we have Q2 under the belt, let's see where we are. That's completely understandable. Just to be perfectly clear, everything else equal, the high end of that sell out guidance also assumes some kind of macro deterioration. That was how I read your answer. Is that correct? Yeah. I guess that's a fair way to interpret it, because it, w e do get a bit easier comps on both macro and China in the back half of the year. Exactly. Thanks for that, Anders. Lars on- And then on On the market The overall market. Yes, sorry. Yeah. On the market share. As you know, these sources are not. They're not perfectly lined. Whatever I say, you have to take with a grain of salt. If you talk about the U.K., for instance, we're using something called ONS, and the data we get from there covers both watches and jewelry. We don't have a breakdown within that. If I look at that, with that's reported both in value and volume. Volume is a bit even more difficult to understand, to be honest. If I look at the value during last year in U.K., we outperformed the market pretty much for all the quarters that we have data for, and that has carried into this year. In U.K. it seems like now whether it's 1% or 5%, this I would not put my money on that, but it looks like we're outperforming a soft market in U.K. That's kinda how I would view that. In the U.S., you know, we have credit card data. Now we also have something called BEA. Regardless of how I view that, it seems that towards the back end of last year, we started gaining a bit of share, and that seemed to have continued into this quarter. Again, it's gaining, holding or gaining a bit of share in a soft market. That's probably how you should view both U.S. and U.K. Maybe just-. Can you give some hard numbers on the overall market in Q1? Uh. Based on those sources. You have it. Here it goes. I'll give you the numbers, and that's why I'm careful with not quoting them. Because if you're to believe Citi, then it's, the quarter is down 19%. Bank of America would have it down 2%. Then this BEA would have it down 5.5%. Take your pick. Yeah. Yeah. I'll take the minus 19. I have a buy rating actually. That's why we're very careful with this. Yeah In that context, I mean, you have our organic. You should not compare it like-for-like. You should compare the organic number because that's what they will reflect. Yeah. Of course. Makes sense. Right? In that context, our Q in U.S. was down, I think three points in organic. Yeah There, thereabout. Just one clarifying thing on the ONS and BA, it's both the public official bureau of statistics, Office for National Statistics, I think it is in the U.K., and Bureau of Economic Analysis in the U.S. It should be broad, valid data. Yeah. Thank you very much. I speak to my general manager in the U.S., of course, the market is only down 2%. You know that, right? Thank you, Lars. The next question will be from the line of Piral Dadhania from RBC. Please go ahead. Your line will now be unmuted. Thank you. Morning, everybody. Two questions from me. The first is on the flat retail like-for-like, and if you could maybe break it down into price, volume and mix. I understand that the pricing was around 4% taken at the end of last year when you said that there was no sort of revenue contribution. The thought process that we have is volumes are probably down by a similar amount on that 1% elasticity you talked about. I was just wondering where the Brilliance kind of contribution comes in because we would expect to see some positive mix effects coming through from that. Maybe nobody's asked the question so far, maybe you could provide an update on Brilliance and how that's going. You said it's on track, what should we expect in terms of contribution by the end of this year on a consolidated basis, if possible? Then the second question is just on eyewear and ancillary categories. One of your key competitors at the end of last year announced a eyewear licensing agreement, and it looks like they are diversifying a bit more. I was just wondering if that's an area that you would consider in the near future, and whether product diversification is something that we can expect to hear about at the upcoming CMD later this year. Thank you. On your first question, we don't, we really don't have a proper, let's say, GMBA or mixed model established as yet. We're looking into that. But that really we don't, you know, we'd have to take that as a separate conversation. I don't have a handy answer to that. We are not guiding on specific size of collections and you should not expect us to do this. We're happy to report on the like-for-like performance on the various collections, and then there's plenty of material that you can deep dive into. On the diversification question, our Phoenix strategy calls for staying squarely focused on the jewelry category. We don't have any plans to enter that space. That said, it doesn't mean that if there is a, you know, interesting licensing opportunity for the brand, which means somebody else handles it, you know, from top to bottom, that, you know, we're not closed to that conversation. So far, we've been very focused on staying with our own operation in the jewelry space and so that you should not expect us to jump into any, you know, major activities outside of jewelry for the time being. If and so, then we would, of course, let the market know. Maybe I can just add, Piral, on the first question. I mean, directionally, your thinking is right. If you look at the mix piece, it's very stable, and it's been very stable for a long time. If we look at each of the price brackets across of what we're selling, it is quite super stable. There's been a slight shift on down trading, but it's actually, it's really small. For all practical purposes, I would say that the mix piece is close to zero with the dynamics on the price increase and thereby units, as you mentioned, broadly being where we are in Q1. Thank you. Thank you, that's very helpful. If we think about the ambitions for Brilliance, though, should we expect that it will d o you expect it to contribute to mix over the medium term as it ramps up? I appreciate you're not giving targets on where it could get to, et cetera, but is that the ambition? Is that it should contribute to mix? Because it feels like the messaging has shifted a bit away from sort of Brilliance and what that could deliver and towards more regular pricing surveys and price increases on a like-for-like basis. I just wanted to understand whether there is a deliberate change in the messaging that you're giving us today. No. There is no change. I mean, what we've said for other platforms before we did diamonds, we said that each new platform needs to reach, let's call it a critical mass within our own organization in order to get the right space in the store, the right attention from the sales associates to get the, you know, the attention from the marketing and whatnot type of communities we have in here. We put a, you know, a very rough number that probably means each of those collection has to hit at least DKK 1 billion within a few years. You know, and that's a very wide, there's no magic science, but that would suggest that there is sufficient productivity for the items so that the store people wouldn't kind of stick them in a drawer and not pay any attention to them. We haven't really put any of that thinking on the table for diamonds. It's a new category for us. We're learning. The long-term ambition is, of course, to make this something that is quite significant to Pandora, but that's a journey until we get there. I think maybe when we get to the Capital Markets Day, we will probably put a bit more rigor around what I just said. When we launched, you know, this could have gone in many different directions. Where we are now, we're very pleased with the, let's say, the performance up to this point, but we need to expand the assortment. There's plenty of things that we need to do in order to realize a much bigger business potential going forward. In the Capital Markets Day, we will definitely put more spotlight on this because I think it's a very relevant question. Thank you very much. Thank you, Piral. The next question will be from the line of Antoine Belge from BNP. Please go ahead. Your line will now be unmuted. Yes. Hi. It's Antoine Belge at BNP Exane. Two questions. Actually, I'd like to follow up on the lab-grown diamonds, especially with regards to the Evoke 2.0 format, because I think you are quite transparent in saying that in Q4, I'm going to quote you didn't quite catch the or crack the code in terms of how, you know, to deal that specific clientele, especially at a time when it's more about, you know, selling moments, et cetera. Is it possible really to share a bit of what the new format will bring in terms of perhaps, you know, selling experience which take much more time? Second question is, well, probably two in one, I have to say, around margins. I understand that this tender offer allowed you to lower the cost of advertising, is it a saving that we should have for the full year on the future? Do you think that it would in a way be better to reinvest that savings and maintain, you know, similar advertising to sales ratios? Basically, you know, having more for your bucks. The second question or the third within the second is about any indication about, you know, the quarterly margin into Q, as we had mentioned that Q1 would be lower. I don't know if you can already, you know, flag things that would make the margin different from last year. Thank you. On the first question, it's the Evoke 2.0 and actually Evoke, as a start, is not just about the diamond experience. The idea is I mean, I'm sure you've been into our existing stores. That was kind of conceived when Moments was the main idea in everything that has to do with the operation, the way it's presented, et cetera, et cetera. The idea behind Evoke 2.0 was to maintain that high level of productivity that we need in peak trading moments, also to allow for more of a self-exploration, for an ability for consumers to kind of see that we offer more. It is not just about diamonds. Diamonds is one of the collections, of course, in that experience. If you go into the Evoke 2.0 now, you will see that we're using the walls to essentially have like permanent displays for the different experience that we want to offer. There's an engraving station, there's a gifting station, then you have Pandora ME, there's a news station, et cetera, et cetera. It's a way for us to physically use the space to showcase you more. When it comes to the specifics on diamonds, I think it's something which we're still learning. We've played around with different things in the U.S. where there's been kind of a put back in the store. It had a separate table, there's a sit-down area. I think this is something that we're still trying to work through. What we're not trying to do is to create a completely different experience inside Evoke. It's a Pandora experience. Pandora will then offer you Moments over here, Pandora ME over here, and Diamonds over here. Of course, there's some different idiosyncrasies for them, but essentially it should still be a Pandora experience. I'm not trying to emulate an experience that you would have when you go into a high-end luxury brand, for instance, because this is not Pandora. We are trying to find our own ways through this. On the media tender, as we've said in the guidance, the EBIT guidance is about 25%. If things go really south, well, then we will have to do cost activity to protect that guidance. If, on the other hand, the business performs better, then that would open up some space to invest more, and that's probably in that kind of frame that we could consider reinvesting some of that. The media tender has been such good that I actually, I can maintain more or less the same pressure as I had last year. My bet, though, is as markets go soft, the pressure from the competitive pressure is gonna reduce if I look at the full year, thereby actually, relatively speaking, giving me an upper hand. Already with that scenario, I think I can deliver more. If we were over-accelerate on top of that completely is dependent on the macro and the consumer sentiment. We see that that kind of comes through in the numbers. Yeah, and then I'll gladly hand over the last question to Adrian. Thanks for that. Yeah, on the question about Q2 and margins, I think the way to think about the full year on margins is that the Q1, two and three, the EBIT margin is going to be a bit below last year, Q4 above. Then we'll be landing the full year around 50 basis points below last year. Which you can always look at numbers in many different ways, but the 50 basis points going from 25.5% delivered actual last year to around 25% this year, that's coincidentally equivalent to the net FX and silver price impact. That's one way to look at it, that 50 basis point change is purely the more technical part of what happens in the P&L. Q2 specifically, think about it like in Q1, with the EBIT margin being down versus last year. I think it's important to stress that there's no structural changes. I'm not. Alexander and I are not sitting looking at that A, B, C needs to happen in order for the full year EBIT margin to play out like this. It's just cost facing, combined, number one, combined with some revenue facing on the selling here in Q1. That's a Q1 specific thing. Then, the quarterly impact on FX and commodities. For the full year, we have a net impact on FX and commodities of 50 basis points headwind. That it is, if you break those 50 basis points down by quarter, then that's a headwind in Q1, two, three, and then a tailwind in Q4. Between the first three quarters and Q4, there's more than 100 basis points swing from FX and commodities. That, that also plays in a, in a bit. Thank you very much. Thank you, Anders. The next question will be from the line of Maria-Laura Adurno from Bank of America. Please go ahead. Your line will be unmuted. Thank you very much for taking my questions. I actually have three questions. The first one is with respect to the 2Q. I know you probably cannot give us much detail, but I was just wondering if you could maybe shed some light around if you have any type of collaboration or new line or new products such as, for example, the Marvel collection that came out in 1Q last year that you will be launching. The second thing is with respect to China, can you please provide a little more clarity as to what you will be doing from a marketing effort standpoint in terms of like, basically getting the volumes up there? The third question is, if you can already share any type of qualitative thoughts with respect to what we should be expecting from the Capital Markets Day in October. Thank you very much. So on the, I mean, you know, we don't reveal our collaborations ahead of time, and sometimes it's also because that's what's written in the contract. You know, normally I don't wanna give my competition a heads up anyway. What we are doing, and I can talk to, is, I'm sure you're aware that Disney has their 100-year anniversary this year. Each month we are coming out with one new item, which has been extremely popular. So that's what's happening. There's gonna be something happening in the back half, but as I mentioned, I can't speak to that. In China, on the specifics, I mean, the specifics are, I think the most important discussion for today is like two or three years ago, we said we were gonna go with a national relaunch in China. Midways through this kind of wait and see that we've been on, we said we're gonna do the top five,six markets on the condition that traffic was similar to what it was pre-pandemic. As I mentioned before, and it's worth repeating, we're far away from that. Right now, where I'm sitting, it really doesn't make a ton of sense to spend a lot of money when the traffic just naturally isn't there. We still wanna learn about our marketing program and all the other things that we're trying to execute. We will most likely pick 1 city to begin with in Q3. If traffic picks up faster, then we can always lob on more cities as we go. That's probably the key point for you guys to take away from this call. The main strands of the relaunch is there's new advertising, there's more media pressure. We've retooled the sales narrative in the shops. We refocused more to focus on the Moments story, let's say, we stay focused on what kind of the core of Pandora is about. I think those are kind of the key points. There's a ton of detail underneath there. That would be for the sake of this conversation, those are the main points worth mentioning. CMD. Bilal, maybe you wanna talk about the CMD? Thanks for the question. Later on the year, clearly, you know, we have been on a evolution since we announced Phoenix in 2021. We'll update you on progress across the key pillars that we already announced. You know, the way to think about it will be sort of an evolution going forward of the strategy. There's clearly elements that we will be excited to talk about as well. Hope to see you there on the 5th of October. Thank you. Thank you, Maria-Laura. The next question will be from the line of Freddie Wild from Jefferies. Please go ahead. Your line now will be unmuted. Oh, yes. Good morning, Alexander and Anders. Just one quick one from me, please. Could you please talk a little bit about your inventory composition and whether it's still full of those high runners which are easy to sell? That 22%, I think it was, year-over-year inventory growth, how that the cadence of that will go through the rest of the year to get to the flat year-over-year full-year picture? Thank you. Thanks, Frederick. I can take that one. Yeah, we are very, very happy with our inventory composition. No flags at all to raise on that point. The way to think about it, yes, the inventory is up year-over-year, but sequentially it's flat. Rolling back a year and a bit, we decided to increase our inventories last year in order to drive up availability to a higher level so that consumers less often or very seldom go into a store or online and can't buy or find that something is out of stock. We did that during last year and reached the level of inventories that we'd like in the back half of last year. It still means that as of Q1, the year-over-year in inventories are still up, but yet just repeating almost flat sequentially. If we deliver at the midpoint of our revenue guidance for 23, you should expect inventories to be flat year-over-year, flat-ish year-over-year when we get to the back half of or get to the end of 2023. We're quite happy with the level of inventories that we're operating at. Perfect. Thank you. Thank you, Freddie. The next question will be from the line of Abhinav from Société Générale. Please go ahead. Your line now will be unmuted. Yeah. Hi, thanks for taking my question. One question on your sales concentration. You said that Mother's Day, Valentine's Day, and Christmas are, like, the most important events. I mean, I know it's difficult to point out precise numbers, but on a normalized level, what would be, like, how much of your annual sales will come from these three days? That's one. Second is on your sales by channel. I mean, I see that the wholesale sales declined by an accelerated 20%, while your retail sales sequentially remained stable. I mean, it grew 12% in 4Q, and it grew 12% this quarter. Any color on that? Thank you. Honestly, do you have the number? Sorry? Just conversing with my colleagues here. I don't have a number pulling out of my hat on your first question. Okay. By the way, maybe I'll just look it up as we speak. Maybe I can start out on the other one. The number you might be referring to might be sort of looking at the overall revenue decline in wholesale. That does make it look a little bit worse than what it actually is because we have been taking over quite a number of stores during the year from acquiring or taking over franchise partners. That obviously means that the revenue by channel, it goes out of the wholesale channel and into our own stores. When you filter out all of that, going back to what Alexander said earlier today, that like-for-like, so the underlying, so real performance, if I can call it that, like-for-like performance in the wholesale channel is below what we see in our own stores. It has been like that for a while, but the gap is clearly bigger in Q1, but not to the extent when you just look at the reported revenue numbers. Okay. If you look at the, for example, at the year, full year, then the revenue is split, and you probably can see that in the public numbers already, but it's roughly that we have to the tune of 40% of the revenue in Q4, and then Q1, Q2, and Q3 being almost so very broadly similar, at around 20% of the full year revenue each. Black Friday, Christmas clearly being the biggest trading event. When you look at, for example, at the Q2, where this year the bulk of Mother's Day falls in May, then the month of May is what is that? 70%, 80% bigger than April, and thereby almost constituting a bit more than 40% of revenue for the full quarter. The trading events are sort of quite impactful. And in Q2 it's the Mother's Day, which is also in the top three or four for the full year in terms of revenue. Okay. Okay. Very clear. Thanks. Thank you, Abhinav. The next question will be from the line of Thomas Chauvet from Citi. Please go ahead. Your line now be unmuted. Good morning. Thanks for taking my questions. Firstly, you're talking about trading down consumer behavior towards lower price points in the U.K. I assume it's trading down within Pandora Moments, but are you observing the same phenomenon within Pandora ME or Diamonds for Pandora? Are you not seeing that pattern in France and Germany and Italy? It was specific about the U.K., I think, in the press release. Secondly, Alexander Lacik, earlier this morning in the media interview, you said the relaunch of China will be gradual rather than too many cities at the same time. Is that your OpEx investment spread across therefore H2 2023 and H1 2024, particularly the marketing? Are you planning to open or refit some China stores to the Evoke concept? Just a bit of clarification on your margin bridge. Anders, in your slide 23, it says 100 basis points drag from Phoenix investments, and that's as previously guided. In the press release on page 16, the guidance for that margin bridge shows 150 basis points margin drag from Phoenix. Is that a typo, or is there an underlying increase in the Phoenix investment that would potentially impact your EBIT margin by 50 basis points? Thank you. On the first question, I'm just looking. What we have in U.K., and this is Q1, I'm talking owned and operated, which is, let's say a big chunk of the business, of course. My traffic is up double digits year-over-year. Transaction volume is up a couple of points. Basket is up a few points. UPT is up, which means that the average selling price is a touch below waterline. That's probably i n a way, you're somehow compensating a slightly lower ASP, but it's not massive. It's a few points, slightly lower ASP, with more people coming through the doors. This trading up or down is not significant. It's not massive. There is something, but it's, It's a similar trend on e-com. Looking at it quickly here. Let me just double-check. Yeah. You have the, In fact, ASP is actually up two points, so it's more in the stores that there's a slight. It's really not much to write home about, Thomas, if I'm honest. I wouldn't make a big deal out of it. France and Germany and Italy. No, this is not a major deal. I think what's more important is the general consumer sentiment and the macro which drives the behavior in those markets than this kind of trading down. I don't really see this as being a big point. Then in China, I think we're. Listen, I mean, as we said, when we built the budget for the year, we did not assume that China would reopen. Therefore, we had, let's say, a business as usual type of budget, to hold the fort somehow. Then, of course, the moment we kind of hard-coded our budget, then China somehow declared that it was gonna reopen itself. This has been more playing a bit by the ear. As I said, the traffic has been slower to come back than where I think it needs to be, and therefore we'll do, you know, we'll do it one city. If things change in the next 30 days, I'll accelerate it. you know, with the type of margin profile we have on the business, we can generate sufficient funds from within, and then we'll top it up a bit with the group support. I think what I'm saying is I don't have a firm plan for China. This is gonna be something that we're gonna play depending on how the market evolves. That's just where we are. As we build the plan for next year, it's entirely dependent on how this relaunch has gone and, you know, what the China market response has been and how the market is behaving in general. I think that's a bit too early to speak about today. On the last question, Thomas, it's super well spotted, and you are right. And it, one of those small updates that wasn't caught just before the announcement. The 100 basis points that you have on slide 23 in the investor presentation is the right number, not the 150 basis point. I'm happy that you read our announcement in detail as well. Well spotted. Thank you, Anders, and glad there's no change in guidance. Thank you. Thank you, Thomas. As a reminder, please press five star to ask a question. The next question will be a follow-up from the line of Kristian Godiksen from SEB. Please go ahead. Your line will now be unmuted. Thank you. I was just wondering on the ASP as well, what was the impact of the U.S. being more promotional? You mentioned the market is still very promotional or promotional. Sequentially, it doesn't change, but what was the impact from you needing to be more promotional, especially on the gifting occasions? Secondly, you mentioned that you postpone the expansion in Thailand, and I'm a bit curious to hear the reasons for that if you're still fundamentally underlying on the outlook and why this have no impact on the CapEx guidance. Thirdly, maybe if you could comment on what are your key concerns for the rest of the year. Thank you. There is no change in the quarter on the average ASP in the U.S. Whilst, you know, the winds are blowing hard around the corners of our business, we have not gone down and responded with, you know, any change actually in the promotional strategy of the business in the U.S. That index is flat. What we've done when it comes to Thailand, of course, when there were two reasons why we needed to expand the facilities. One is from a business continuity standpoint, so that, you know, we, in case something happens, we have some alternatives to go to. The other one was, of course, as part of the long-range planning, we see that there's capacity that we will require. The decision we made was to increase with one extra site in Lamphun in Northern Thailand and an additional larger one in Vietnam further on. They were kind of sequenced, so first Thailand and secondly Vietnam. What we've done, we've simply reversed the order of those two things. Obviously, when we started this whole exercise, we did not expect that the macro would be the way it is. Short term, we can manage the volume increase, you know, either moving ourself to three shifts inside our own facilities and/or work a bit more with OEMs. The short term capacity question, we think we have covered. We still are intent on continuing with Vietnam first so that we will get more volume as well as a business continuity plan. So, you know, and then maybe the phasing of the CapEx. Anders, you can talk about that. Yeah. Yeah. On the phasing of the CapEx, in the guidance for the year, it was already in there. We made this decision to postpone it late last year. I guess it must have been probably late last year we decided to do that. That is already in the, in the budget guidance for this year. In any case, it wouldn't have been a very big number for 2023 still for Vietnam. And then I think your last question, Kristian, was about. Key concerns key concerns. Yeah. Anders is looking at me. I have more concerns. No, I think the key concern is obviously the macro. I mean, the U.S. macro, which is kind of Q4 carried into Q1. Is that gonna continue in that vein? Is it gonna go up or down? I mean, that I think is the question on everybody's mind to be honest. China is a concern, more from a positive angle, is how fast is it gonna come back? You know, if it's slow, then it slows down the relaunch plot. If it's faster, then of course we will accelerate according. I think those would be the two main points on my mind. Europe, as somebody already pointed out, we are facing a softer baseline in the second half. If everything goes to plan, I mean, Europe will hold its own. That's less of a concern in my book. It's probably more about the U.S. macro and the speed of the China recovery that would be top topics in my head. Alexander, if you were to focus on the ones where you have control, which would then it then be? Uh- Macro, I guess you can't really do anything about it, unfortunately. Unfortunately, I can't do. I can pray, but it doesn't seem to help much. No, I mean, in the controllables, what I mean, after the pandemic, of course, we have seen that recruiting and retaining retail staff, in particular in U.K. and U.S., is a challenge for all of retail, not just Pandora. Of course, that's a space where one really needs to kind of double down and figure out what the employee value proposition is in order to keep recruiting people. I mean, we have a big fleet of stores which is constantly expanding and making sure that we retain the good talent that we have out there. That's probably a controllable. We're spending a fair amount of energy on that topic. That hasn't, you know, you can, you can see it. When you have a store where you have a good management of the store, we have, you know, people that have been around for a while. Those stores are simply put, just more productive than the other ones that have the opposite. We can see it in if we look at the franchise example, as I said, you know, they put a little bit less store hours in and, you know, quality of staff is pretty much the same. It's a war for talent, in particular in those two places. That's probably something which is not a concern, but it's something we have to work hard to get to a decent place on. Okay. Thanks a lot. Thank you, Kristian. The next question will be from the line of Louise Singlehurst from Goldman Sachs. Please go ahead. Your line will be unmuted. Hi, good morning, Alexander and Anders. Thank you for taking my questions. I think we've got a huge amount of details. I'll keep it very brief. Just following up on the marketing spend, the 4% decline. Does that mean if we think back to where you were on January 1st, that sales in the quarter were ahead of where you expected them to be? We're just trying to sense versus your expectations now at the end of the period. If so, which regions would you highlight? Is that more U.S., but obviously Europe was strong. The second follow-up was if there is a little bit more cost flexibility for 2023, I know it's early days, but if there is, I suppose, Alexander, it'd be keen to hear where you'd like to prioritize the spend if you have a little bit more in the wallet to spend on priorities for 2023. Where would you rank the first couple of areas? Thank you. On the marketing spend, as I said, if you stare just at the face value number, then it's lower than prior year. If you look at what I'm getting for my money's worth, it's pretty much the same outcome. It's not a big topic for me as such. Your second question I think is more interesting if I had some more spend. Looking at it from a. There are two perspectives then you would have to apply. One is strategically where should we put the money, and then there's a short-term aspect. Of course, the world is never black and white, you live in the gray. If I kind of give you the pure answer, that would be to really deliver on the ambition we have to double our business in the U.S. I would put more money into the U.S., and probably I would put more marketing spending in the U.S. I know my awareness levels are still lower than where I'd ideally like them to be. That is the first bucket of spend. I'd probably hope that China traffic returns, and that would be the second place I would put the money because we know we are, you know, way behind there when it comes to awareness of the brand. That's the bucket. The third one would probably be, but this is not a practical answer, but if I had a magic wand, I would convert all of my stores into Evoke 2.0 because I know that this generates, y ou know, when you're trying to create brand desire, it's not just about the advertising spot or what meets you when you go online, it's also the physical experience. I think what our store staff delivers is fantastic. We know we have a very competitive experience, but the stores need a refresh. There is no doubt in my mind. Whilst we're only doing, let's say, 40 conversions or new stores on Evoke 2.0 this year, we'll definitely put down the foot to the accelerator next year. My vision would be if we can, this is a capacity question, if we can, then I would like to convert the entire network in the next three years, because I know this drives the brand experience and the brand desire. The value of the brand goes up. Those are probably the spend buckets. As I said, the last answer is not a very practical answer, but that's where I would like to invest in a better experience. We are doing something which is kind of, because it's gonna take a little bit of time in many stores around the globe, so we're doing a midways, kind of, you know, touch up refresh, if you may. But that's far from the full experience of Evoke 2.0. Other than that, I think we're well-resourced for the key bets of the year. Great. Thank you. Thank you, Louise. The next question will be a follow-up from the line of Michael Vitfell-Rasmussen from Danske Bank. Please go ahead. Your line now will be unmuted. Yeah, thank you very much. Just a quick follow-up from me. Anders, this is probably a question for you. I noticed that your refund liabilities were down by 21% year-on-year. Looking that as a share of last 12 months sales, I believe that's the lowest number we've ever seen. Can you please explain that to me? Thank you. Yeah. It's a good call out, Michael. The bigger element of that is in the U.S., or North America, I should probably rather say, including Canada, where we last year have continued the journey of reducing the contractual opportunity for wholesale partners to return products. We've been on that journey for a couple of years, actually, and took another the actually the last step last year. Now the structure in North America is aligned with the rest of the world. That's the bigger element of it. The way that we calculate the return liability, the refund liability is based on what actually. This is our own stores. We then base that on what are consumers actually returning. Then that percent of products being returned is simply going into the calculation. We are seeing. We've always seen low returns and it even come down a little bit further in our own stores. The bigger piece is the wholesale part in North America. Great. Thank you very much, Anders. Thank you, Michael. As there are no further questions at this moment, I will hand it back to the speakers for any closing remarks. Well, thank you. It was a lively debate today. As I said, we're very pleased with Q1. Once again, I invite you to put October 5 in your diaries, which, you know, we'll make sure it's worth your time. On that note, thank you very much.