Okay, thank you. Welcome to Scandinavian Tobacco Group's first ever Capital Markets Day. Welcome to those of you being here in person in The Ned in London. It's good to see all of you here despite the circumstances. I'm quite pleased to see so many faces that have shown up, so thank you very much for that. Also, for all of those of you following us on live stream, welcome. We have, I would say, a surprisingly big amount that has signed up for the event, and that, of course, is a pleasure for us. I can only say that we have been working hard to deliver a good day for you here. Our ambition is that we will give you some insights to our company. We will give you insights to our strategy, but we will also tell you more about our financial ambitions and how we expect to fulfill those going forward. Of course, all of that in the aim of creating and continue to create value for our shareholders. I have to say that this event is being video recorded and we will upload it afterwards on the internet website of ours, where you can listen through every detail you might want to. Let me now run shortly through the agenda for the day. Here we are. First of all, we will have an overview of our CEO, Niels Frederiksen, talking about our overall strategy, followed by our Chief Supply Chain Officer, Graham Cunningham, that will give you some more insights into the engine room of our company, the supply chain and manufacturing. After that, there will be a short break, and question and answer session. I will come back to some details how we are going to conduct that. Second session will take focus on the commercial units of our company, where we will have our Divisional Head for Europe Branded, Jurjan Klep, starting off, followed by Régis Broersma, that is our Head of North American Branded and Rest of World. Finally, we also have Sarah Santos, that's going to give you insights into our North American online and retail business. We will have a short Q&A session, and finally, we will conclude the day with some insights to our financial model, our financial ambitions, by our CFO, Marianne Røslev-Falk. Before we get started, we would like to show you a short video that is visualizing our purpose of the group. To be human is to seek meaning. In an increasingly complex and globalized world, meaning can be hard to find. We work harder. We build bigger. We run faster. We hear, but we forget. We see, but we ignore. Despite being more connected than ever before, we are losing connection with what really brings us together and makes us human. We rely on our senses not just to survive, but to connect with the world around us. Our greatest memories, the good and the bad, are shaped by sounds, images, textures, flavors, and aromas. By engaging all our senses, we connect with the vibrancy of our world, and we remember what it means to be part of something bigger. From the annual milestone or the big celebration, to the midday meditation or the individual moment of joy, we use rituals to create meaning and feel a sense of belonging. They inspire us to strive for more. More passion, more joy, more new ideas, more drive, more creativity, more in the moment, more courage. More human. Yes, with this, we will open the session, and I will give the word to Niels. Thank you, Torben. Good afternoon to everyone here in London and everyone on the live stream. My name is Niels Frederiksen. I've been the CEO of the company since 2015, but I've been with the company for more than 20 years, covering almost all functional areas. I wanted to start today with this purpose video because I wanted to share with you one of my favorite smoking rituals of a good summer. Now every weekend there's a football game on, and my team, F.C. Copenhagen, plays every weekend. If I'm not in the stadium, I will be in my summer house on my veranda with my iPad watching the game. As I prepare for the game, I brew myself a strong cup of coffee, I go to my humidor, and I look for the perfect cigar for the game. I'll always pick out a number of cigars, because picking out just the right cigar for that match is not as easy as you would think. At the end, I'll choose one, I'll bring it along with my cup of coffee, I'll settle down in a nice comfortable chair ready to watch the game. I'll bring out my cutter, my favorite lighter, and I'll start the slow process of lighting up that cigar and enjoying it throughout the game. That's one of my favorite rituals as a cigar smoker, and one of the things that make me a much nicer person to be around. We'll come back and talk more about the rituals, but I wanted to first talk a little bit about who we are as a company. Scandinavian Tobacco Group is first and foremost a cigar company, and our vision is to become the undisputed global leader in cigars. We are already a leader in cigars, and we export our products to around 100 countries around the world. We have some very strong market positions in the U.S. and Europe, and around 90% of all cigars is still consumed in these geographies. On top of that, we operate the most successful online and retail business within handmade cigars in the U.S. As you'll see over the course of the day, the handmade cigar we consider to be a unique segment where we can compete across multiple parts of the value chain and win. For machine-rolled cigars and smoking tobacco, our focus is really on optimizing our market share based on a very strong portfolio of brands. Let's take a look at why we think Scandinavian Tobacco Group is an investment worthwhile considering. As a leading player, Scandinavian Tobacco Group have delivered consistent performance since our listing in 2016, strengthening our margins and delivering stronger and stronger cash flow. Our strength is really based on some of the finest and strongest portfolio of brands in the industry, and we have many number one and number two market positions across the geographies. Based on the consumer insights that we generate and have generated over the years, we've been able to implement disciplined and consistent price increases offsetting market declines. In parallel with that, we have been focusing on optimizing and simplifying the business, leading to healthy margin improvements and stronger cash flow, all things that forms the basis for a strong capital allocation policy. It is my clear belief that we are the strongest cigar, the strongest company in the cigar industry, and we are better positioned than any other company to further consolidate the industry. We have the financial strength, the expertise, and the intention to consolidate the industry further. Let's take a look at our role in the bigger tobacco market. We are really a niche tobacco company focused on rituals and smoking enjoyment. To us, the quality of the tobacco we use actually matter. We are occupied with creating new smoking experiences and with making sure that we put our craftsmanship to use across our many different product categories. We're not a mainstream tobacco company, and we try to avoid going up head-to-head with big tobacco companies. We have a well-balanced portfolio, both across the product categories, but also across the geographies, and this is part of the risk mitigation against new regulation, which still has a regional approach. We believe in the sustainability of the cigar category. It is an older consumer base, it is smoked less frequently, and it's smoked more for enjoyment than many of these other categories. We know that many cigar smokers are actually dual usage, dual users in the sense that they will also consume other tobacco or nicotine products. Let me introduce some of our fine brands. In the handmade cigar segment, we are number 1 in the U.S., and we are number three globally or outside the U.S., it would be more correct to say. We own a number of the Cuban trademarks in the U.S. only. These are brands such as Cohiba, Punch, Partagás, Hoyo. Outside the U.S. and globally, we own strong brands such as CAO and Macanudo. Whereas we are the market leader in the U.S. and we can compete comfortably across all segments from value to super premium, outside the U.S., we really need to strengthen our brand portfolio further so that we can invest more money behind globalizing our handmade cigar business. Let me turn to the machine-rolled cigar segment. In machine-rolled cigars, we are number one outside the U.S., and we are almost nonexistent in the U.S. for all sorts of historical reasons. Also here, we have a great assortment of brands being able to compete across all meaningful segments. Our job here is slightly different than in handmade cigars because here we are working hard to reduce our the number of brands we have in our portfolio to a core set of brands that we believe is required to compete and win in the markets where we are active. Let's turn for a second and talk about regulation and how we try to use this to our advantage. I think it's fair to say that we have many decades of extensive experience in dealing with and adapting to new regulation. In many cases, our categories remain more leniently regulated than cigarettes. Our success today is really based on an in-depth understanding of new potential regulation, and we try to make sure that we are well prepared to deal with this from a supply chain perspective, but also making sure that we can adapt our consumer propositions in a way that we remain competitive. This makes us a trusted partner to many of our customers because it does not only hit the industry, it also hits our customers, and many of them have a need for guidance and education when new regulation is passed. Our core focus remains the U.S. and Europe, where we work directly or via trade organizations with the legislators to make sure that when they pass new legislation, they have the best possible information available and know the likely impact of the new laws that they will be passing. I will not today go into detail with any particular parts of regulation, but I'm of course happy to answer any questions there is in the Q&A. What I will emphasize is that whereas on the one hand, we see new regulation as a challenging threat to the industry, it is also an opportunity. We see again and again that new regulation is much easier for us to deal with than our smaller competitors, and we consider it one of the things that will trigger acquisition opportunities over time. With that, let me turn to our sustainability strategy. Now, responsibility is embedded in Scandinavian Tobacco Group as a core value, and it shapes how we conduct our business. In 2020, we launched our new sustainability strategy that really focuses on four core areas, people and communities, the planet and how we work to ensure that we have a sustainable business, ethics, which is particularly critical in our line of business, and then the governance, which is really how we ensure adequate oversight with our business. However, as we said, we are working hard to implement that strategy, but we've also, in the course of 2021, realized that we needed to raise our ambition in this area even further. We have been working on the next generation of our sustainability strategy. We will come back within the next 3-6 months and show you how we intend to accelerate our efforts within this area even more than what we're doing today. Let's turn to look, and I hope it's not me they're coming to pick up, but, let's turn to our performance over the past five years. Scandinavian Tobacco Group has really been on a journey to transform itself to a more professional, more customer- or consumer-oriented, and more scalable business. We've implemented a number of initiatives over the past couple of years, and to mention a few of them, I would say we have gone from a decentralized to a global operating model. We have increased the number of commercial people in our executive leadership. We've invested significant sums in building further consumer insights. We've upgraded skill level across a number of critical areas such as digitalization, Lean procurement, strategy execution, and planning. We've started what you all know is a substantial journey towards implementing a global SAP solution for our company, something which I think will be very, very good for us over time. Over the years, we may have seen year-on-year variations in our performance, but since the listing, we have significantly improved the size of the company and the profit of the company. We have today stronger margins, more healthy cash flows, and we believe altogether delivered attractive returns to shareholders. Before going to talk about the future, I just wanted to talk a little bit about Scandinavian Tobacco Group in an even longer time perspective. People often ask me, "You know, isn't life in the tobacco industry with all categories in fundamental decline? Is that not a difficult industry to work in?" I always say to them, "Yes, you know, working in the tobacco industry is challenging, but the people that come and join us also join a team with ambitions and a history that proves that we can build a bigger company, even in a challenging industry." Since our divestment of cigarettes in 2008, we have more than tripled the size of the company. We have more than quadrupled the size of our earnings, and we're delivering significantly stronger and more consistent cash flows. In other ways, our strongest argument for future success is really our history. I think to me, our history is our credibility. We intend to build a bigger business, and we want to become the undisputed global leader in cigars. When you join Scandinavian Tobacco Group as a new employee, you join us with a growth mindset, not with a mindset of declining or managing a declining business. Let's look a little bit at our updated strategy. Again, I would say it may seem trivial to a non-smoker, but to a cigar smoker, cigars actually matter. This is why, in the new strategy, we have put rituals at such a central element of our new strategy, and this is also the reason I started with the storyline that we did. Rituals are a critical element of what we do. When you look at how these rituals fit into a consumer's everyday consumption or everyday pattern, when you, as I do, smoke cigars, and when you are facing a society that is fast-moving and changing all the time, the rituals matter. It doesn't really matter whether these rituals are a cigar, a pipe, a cup of coffee, or something entirely else. Rituals are important, and that is why we have developed this new purpose of crafting the rituals that make us more. The updated strategy is first and foremost a commitment to our core cigar business, but also a recognition that while we continue to grow and develop the business, we also need to look outside the cigar business into the wider tobacco category to see all the developments that are taking place and to identify whether there are opportunities emerging where we can meaningfully play and win. Our growth incubator, which is part of the new updated strategy, is really a commitment to deliver better organic growth going forward compared to what we've done in the past. We continue to believe that growth is possible to deliver not only through acquisitions, but also organically, partly through our core cigar business, as also evidenced by the announcement we made today around expanding our U.S. superstores, but of course also in some of these new categories that we believe we can play in as well. With that ambition in place, let's look at what we consider to be our five must-win battles. One paper back. Our must-win battles is really where we, which is really our key priorities and is where we put the bulk of our resources and the bulk of our attention. We see the biggest, organic growth opportunities in handmade cigars, also evidenced by the announcement on the new stores, but also, importantly supplemented by a higher level of globalization of the handmade cigar business. I believe that the impact of COVID-19 to the consumption of handmade cigars globally show that when we can engage with consumers better and more frequently, then they will engage back with the category, and we believe this supports the long-term sustainability of the handmade category more than any of the other categories that we are active in. When we look at our machine-made rolled cigar business, it is really in a better shape than it's ever been before. With the acquisition of Agio, we have a much stronger base from which to optimize this business and prepare ourselves for the next acquisition. Making acquisitions and integrating them with as high speed as possible is, of course, also a must-win battle and one that we work hard at improving on a constant basis. We are very satisfied with the latest two acquisitions we've made, which we believe have both been highly value accretive for our shareholders. Now, we believe that we can be the most cost-effective operator of any cigar business, which would also mean that this will benefit us whenever we do an acquisition, irrespective of how high the synergies are. We are also aiming to be the best in class when it comes to working capital, so that we can basically release surplus cash from the acquired companies, and altogether, let's say, risk protect the uncertainty that will always be associated with acquisitions. When you look at a company like ours that grow through acquisitions, there's always a risk that complexity takes the upper hand, and hence we constantly work on how to simplify the company. This really covers everything from our processes to our brand and categories to how we organize and work and operate the company. I think the single biggest commitment we have at the moment to simplifying the company is our global SAP implementation, which will not only support standardization and automation of processes, but also will support a cultural transformation of our company. Our last must-win battle is around creating the necessary performance culture. A culture that not only supports strong execution of our plans, but also attracts the type of individuals we need to succeed. These are people with a growth mindset, people that like challenges, and people that embrace changes, because that is what you will get when you come to work for Scandinavian Tobacco Group. Let me quickly cover what the team will go over in the course of today. What we will try to show you is that Scandinavian Tobacco Group is a market leader with a successful history of strong financial performance and industry consolidation. We'll also show you that despite increasing regulation, we know how to navigate these and grow the company. We are focusing really hard to professionalize the company, allowing us to leverage our experience and our financial firepower if and when the opportunity arise. Our focus will continue to be on combustible products, but we will also start looking at other emerging categories. We use our craftsmanship to create the best possible consumer propositions across the categories where we compete, and we continue to believe in the importance and passion around tobacco and smoking experiences. We have a proven M&A strategy with successful acquisitions under our belt and room for and an opportunity for even further consolidation. We firmly believe that no other company is as well positioned to win in this industry as we are, and hence we continue to pursue our vision of being the undisputed global leader in cigars. Let me finish off with a few words on our management team. Because since I took over back in 2015, I've been working diligently and hard to put together a diverse leadership team that I actually believe can execute our strategy and achieve our vision. What I've been focusing on is really putting together a team with the right combination of industry insights, functional expertise, and intellectual capacity. What I have here is what I believe is a battle-tested leadership team ready to take Scandinavian Tobacco Group to the next level of performance and to make sure that we can deliver and develop a sustainable business also for the future. With that, I will thank you for your attention so far, and I'll give the word back to Torben, who will take you to the next point on the agenda. Thank you. Yes, thank you very much, Niels, for this introduction. As said, now we will take the next step into kind of the engine room of our company. For that, I'm very pleased to leave the word for our Chief Supply Chain Officer, Graham Cunningham. Here you go. Thank you, Torben, and permit me to extend my welcome as well to everyone in the room and those of you joining us online. My name is Graham Cunningham. I'm the Chief Supply Chain Officer here in Scandinavian Tobacco Group. I've been with the group for just over four years now. Prior to this, I spent 20 years in fast-moving consumer goods, leading diverse global teams across procurement, manufacturing, integrated planning, customer service, logistics, and warehousing. Today it's my real pleasure for the next 10 to 15 minutes to take you through an overview of our global end-to-end supply chain. Through the information I'll share with you, there are really four key takeaways today. The first one is we have a robust global manufacturing network. We have a distinct production model that we feel drives consumer value, and therefore, shareholder value. We have a committed sustainability focus, and I'll share some information on one of the pillars that Niels described, the planet pillar. We have a continued passion through a highly engaged workforce to constantly optimize our production and drive the business forwards. Let's start with an overview of the seed to smoke. One of the things that gives me energy in the morning is the juxtaposition we have actually across our end-to-end value chain. It all starts with a seed and agriculture, and it ends up with the latest online e-commerce and fulfillment platform driven by an integrated planning system that has artificial intelligence in it. On one end of the spectrum, it can take us up to five years to craft a luxury vintage handmade cigar. On the other end of the spectrum, it can be clicked and in the hands of a consumer in 24 hours. Let's build a little bit on the front end of the process. Points one and two here about seed and tobacco barns, we use the rule of magic sixes. It takes six weeks to plant and germinate the seed. It takes a further six weeks for the plant to mature and be ready for the first priming or harvest. Six weeks later, the plant harvest is actually completed, and then we take the green leaves into a tobacco curing barn. It looks very similar to the picture on point two there, and that's where the magic happens of the green leaves turning into the light brown that you know and associate with our products. That's when the natural sugar sets in, that's when the nicotine becomes balanced, and that's when the first characteristics of the cigar really develop. After that, there's a process called fermentation, which is a natural process using air, and that's when the leaves we can put through one, two, three times and enrich the body of the cigar. We can enrich the taste of the cigar, we can enrich the look, the touch, the feel, and that's where our craftsmanship really comes to the fore. We then put that prepared leaf through our production facilities. We bunch, we roll, and then we dispatch and sell in more than 100 markets. Let's look at each of those steps. Everything on the left-hand side of the screen here is the six weeks, starting with the growing, the curing, the fermenting. We believe that we have distinctness in our cigar production model that drives real consumer value. If we look at our handmade cigar products, we deliberately choose to vertically integrate all the way down to the fermentation process. If one of our must-win battles is to grow in handmade cigars, that fermentation process and the number of times we do it and the leaf that we select crafts unique consumer experiences. With the thirst for new cigars and with the thirst for innovation, it gives us real ability to innovate constantly and grow the market. If you look at our machine-rolled cigars, here our loyal consumers are looking for consistency, both in taste, in look, but also in quality time after time. They want a reliable, dependable partner, and here we deliberately choose to go as far as blending and threshing so the taste profile is consistent, the quality is consistent, particle size is consistent, and we can be that dependable partner to our loyal consumer base. If we look forward a little bit about our global supply chain operations, we really focus on a proximity model. The key elements here of the design are proximity to where the leaves are growing and then proximity to the lead sales market. If you take our handmade cigars, which is the yellow boxes here, typically the majority of our leaves come from the Caribbean and Central America. We process that leaf directly closest to the point of origin, and that's the fermentation, that's the bunching and rolling, that's the leaf selection to make those unique consumer experiences. Now you'll hear from Sarah and Régis a little bit later about how important North America is to our handmade cigar business. Therefore, we also pack, finish, and make our own boxes in those factories with close proximity to distribute into the U.S. If you come to the blue boxes, they represent our machine-rolled cigar portfolio. Typically, our wrappers, which add the taste to the cigars, are grown in Asia. Again, the proximity model, we process, select, and cut the leaf in Indonesia and Sri Lanka. Then here we decouple the supply chain, and we pack and finish in Belgium, which is closest to some of our largest sales markets, like France, which you'll hear more about from Jurjan in the coming presentations. We also have niche plays and strong market positions in the fine cut and pipe tobacco in certain markets. They're predominantly in the Nordics, so we have pipe and fine cut factories in Denmark. Again, just to repeat, proximity to where the leaf is grown and then proximity to where we're driving the sales and the growth in the business. Now with such supply chain disturbance in the news at the moment, I thought I'd spend just one minute talking to you about the resilience in our business model. The first thing is our most valuable commodity is our leaf. It's our tobacco. We have always had a policy in STG of holding two years of leaf inventory, and that's to buffer against acts of God, natural disasters, or crop failure. We've been able to serve record volumes in recent times without disturbance from that leaf inventory, and we continue today to maintain those inventory positions. Now, I know many companies say that their people are their greatest asset. Well, I really mean my people as my greatest asset. We have a highly engaged and resilient workforce, and I'll show you some details on that in a moment. With their agility, how we run the shift patterns in the factory, we're able to scale up and scale down according to how the market is moving. One small example, pre-pandemic, average week, we were maybe producing 900,000-1.1 million handmade cigars. Peak pandemic, we were able to ramp up the production to 1.9 million cigars per week, so doubling capacity through the agility that we have in the workforce. You also heard from Niels that we're continuing to simplify everything that we do. That also applies to the technology platform, the ways that we operate the equipment, the standard operating procedures. If you take our cuts network, where we cut the wrappers from the leaf, the technology's the same in the Dominican Republic, in Indonesia, in Sri Lanka. We can move knives around, we can move tobacco around, and it gives us real agility in the network to work through things. Now, yes, I'm not gonna mislead you. We are exposed to many of the supply chain volatility that other companies are seeing, such as logistics disruption. What I would ask you to bear in mind is you can get between 500,000 cigars and 1.5 million cigars in a standard 40-foot sea container. The absolute impact on us is much less than other fast-moving consumer goods companies. This is a reinterpretation of the slide that Niels showed with our history of proven acquisition and how the company's grown. In operations, we fundamentally believe in integrating and releasing the value from those companies that we acquire. To put some numbers behind this, we're able to serve today DKK 3.5 billion more in net sales versus 2016, at a production footprint that's 30% less. You'll hear from Sarah about how the acquisition of Thompson Cigar enriched the North America and online division, and how we consolidated the warehousing and logistics platform. You'll hear from Jurjan about the Agio acquisition and how it's enriched our European branded business. Here in operations, our typical path is acquire, consolidate, integrate, realize the value in 12-18 months. We delivered the extra volume through the acquisitions, 30% less production facilities. Now, obviously, we're not acquiring and integrating all the time, so we also need a strong fundamental base of continuous improvement. Niels mentioned it briefly, one of the core pillars of our operating model is Lean or Six Sigma. We're passionate about it across our operations community, which is just over 8,500 people. In the past 4 or 5 years, we've delivered significant improvements to what I call the basics in supply chain. Fundamental duty number one of care to your employees is to keep them safe. Despite the acquisition consolidation trail, we've been able to deliver over a 50% improvement to our safety across our operations in STG. I know you're familiar with some of the standard measures around equipment efficiencies and effectiveness. On handmade cigars, where we thresh the tobacco, you can see that we've added almost 30% onto the effectiveness with which our threshers are working. If you look at the bottom one on the machine-rolled cigars, this is on our natural machine-rolled cigar portfolio, we've been able to add 800 basis points onto the effectiveness and the efficiency of the machines. Across all of our handmade cigar operations, we also use a Japanese philosophy called Kata. If you want to read more about it, you'll find it on our public perspectives on the internet. Here, through studying time, motion, interlinkage between processes, we've been able to drive the productivity per head across our handmade operations up by 700 basis points. More people keeping safe, more productive assets, simplified manufacturing base, realizing value behind the scenes. Now, I've talked about people in the workforce a lot. Niels mentioned 100. I've already mentioned 100 sales markets. There's another 100. Before our loyal consumers get to enjoy that ritual, that moment of smoking enjoyment with our handmade cigars, they actually pass through 100 hands in our operation. 100 hands. So when I said our people are our greatest asset, it's because I need a highly engaged, highly motivated, and passionate workforce to deliver a luxury experience. We recently ran a people engagement survey company-wide, and if you look at my colleagues in operations, over 70% of our workforce directly touch the leaf and manipulate our most valuable raw material. Of that workforce, 83% is highly engaged, 92% are proud to work for STG, and nearly 90% say that work gives them a feeling of personal accomplishment, and that's really important if 100 hands are touching our luxury premium handmade cigars. A lot of nice words on the slide. What I'd like to do is just break and show you a brief video, the smiles of our employees in each step of the process. Play the video, please. Rolling. Years of careful upbringing and meticulous attention are placed in the skilled hands of rollers and transformed into cigars. Enjoyment caters to more than the eye. Draw and flavor must be perfect. Filler tobacco is central to the cigar, held in place by a binder before fitted with the finest leaves, the wrapper. Its fate is sealed with a cap. The cigar is a complex creation crafted with tradition and care. Thank you. Let's shift gear a little bit and have a look at our CSR approach. As Niels mentioned, we have four pillars, yeah? People and community, planet, governance, and ethics, and today I really want to focus on planet. We refreshed our approach in 2020, and really focused on building robust fundamentals. What does that mean? We started with analyzing our Scope 1 and improving at that point. This year, we have extended our philosophy to Scope 2 and Scope 3, and we hope to release further information over the coming months working towards the release of our sustainability report in March next year. I'm happy today to talk about some of the improvements that we've made. The first thing is you've heard about our approach to continuous improvement, driving machine efficiencies, reducing waste, and transforming. Today, we're able to manufacture over 1.5 billion cigars at 35% less carbon impact than we were 18 months ago. We're also in the final stages of negotiating green electricity power purchase agreements for all of our European manufacturing platform and starting to address our scope 2 initiatives. There's much more to come on this and as I said, we'll be releasing more information over the coming time. Building on that momentum, there's much more to come. We're not done with the optimization. We're not done with our continuous improvement mindset. We're currently upgrading our warehousing, logistics, and fulfillment capability in our U.S. citadel to the latest technology. We will continue to drive automation and robotics in our high-cost manufacturing locations to offset labor inflation. With a simpler manufacturing network with aligned technology, it enables us to play labor arbitrage on key parts of the portfolio and move volume around. We're investing in the latest integrated planning and procurement technology to bring data-driven insights to our decisions. You heard from Niels, regulation is an opportunity for us, again, to invest in technology, to consolidate, and to focus on lifting the offering even further from a consumer perspective. Thank you very much for your time, and I'll hand back to Torben. Thank you, Graham, and thank you, Niels. Now it's time for our first Q&A session, relatively short one. There will be two ways to conduct this for you here in the room. There will be a microphone, and please state your company and your name. Then on the live stream, there will be the opportunity to go into the Slido app, and there you either can use the QR code or you can use the code here which is 89403 where you can direct your question and we'll take care of those. I will leave the floor for anybody here in the room. Any questions you might have at this early stage? I will say there will be ample of opportunity, also later on by the end, where we will have a good time for all questions you might have. Doesn't seem as there is any questions here in the room. Yes, we have one here. Thank you very much. Richard Garstang from Oldfield Partners. I just wondered if you could actually expand a little bit on some of the comments you made around new categories and be able to expand into new things. What does that sort of mean? A bit more sort of detail on that would be great. Thank you. That's for you, Niels. Thank you for that question. I think what we have said over the years is that cigars is our core business and where we will put most of our effort and most of our money. We are also seeing that with the development that is taking place in the wider tobacco categories, there are all sorts of new opportunities emerging. On the one hand, we have the view that we should not be competing head-to-head with big tobacco. On the other hand, we are also convinced that there's going to emerge opportunities where we can meaningfully play and win. These will typically be you know, niche segments where there's a higher component of enjoyment, typically a little bit of an older consumer profile, and that's what we're looking for. We also think it's naive to think that we can, you know, live off cigars alone. We think we need to supplement it with some of these other categories, and we think we haven't seen, let's call it the last invention in that area yet. Okay. Thank you, Niels. I hope that answered your question, Richard. Yeah. Perfect. Anyone else here in the room for a question? Otherwise, yes, there's one here. Gerry? Gerry Gallagher of Deutsche Bank. Just following up on that, Nils, could you maybe talk a little bit about whether you're thinking about these new categories from an organic perspective or an M&A perspective? Following on to that, just the general M&A question. You've done a couple of, you know, very powerful deals in terms of return on invested capital, probably from day one, maybe not as many as you would have wanted to do. Could you just talk a little bit about how the landscape for M&A sits today, perhaps compared to where it has done over the last few years? Thanks. Yes. If we start first around the new categories, I think that, you know, we've said before, and I'm happy to say again, we are not going out and investing a lot of money in this. We are going to explore these categories. We're going to start experimenting, and the best example is really our Versa Hemp product in the U.S. We're talking about a test launch in three to five states in the U.S. on smokable hemp, the non-intoxicating part of the cannabis plant. We think there is a niche market for consumers that wants to smoke a non-nicotine product with a nice smoking experience. It's sold at a relatively high price. We think that's a way of testing, you know, can we be in that particular segment. Now, could there emerge acquisition opportunities over time? I think the answer is yes. I'm also thinking that we would want some level of evidence before we would put a significant amount of money behind that. It is not an area where we are going to be, let's say, overly bold. We are, you know, taking a cautious approach to it, but we think we need to build some of these new income streams in new areas as well. If you look at the general M&A landscape, I think the best way to describe it is that the industry is not bigger than we are. We are in contact with everyone. If there's anyone who is looking to divest their business, they will know that we have an interest. This also does not mean that we can automatically, you know, generate more acquisitions faster because it's really different things that end up triggering versus different divestments. Sometimes it is, you know, a new generation having to decide whether to step into the business or not. Sometimes it's new legislation, and sometimes it's just, you know, people not liking the risk profile of the business. What I can say is that we do believe that with the acquisitions we have made, and with the progress we are making in the earnings of the company, we have moved ourselves to a new level of capacity, so we can actually afford more acquisitions today based on basically being in better control of the business, making more money. From that perspective, we believe we are in a better position, or we are more ready than we've ever been for acquisitions. Okay. Thank you for that, Nils. I'm just looking out here. Then I can see we do have a question from Niklas Ekman at Carnegie. You mentioned that regulation has created an opportunity for M&A. Can you give some examples of this? Has the M&A activity in the industry increased since Tobacco Products Directive in Europe and the FDA deeming regulation? I think that if you look at the Arjo transaction, I think that transaction is a good example of multiple factors being in play. It's seldom one particular thing. For Arjo, it was really a combination of the risk profile of the industry versus the alternative use of money inside their own company. They had, over the years, built a secondary investment vehicle into industrial products, and they wanted to take some more money from the tobacco business and move it into the industrial part, and they were feeling increasingly uncomfortable with the risk profile of tobacco. This was especially related to a few big markets where they have a big exposure. If you go a few years further back, we did buy a Belgian company called Verellen back in 2014, and there the owners basically said, "You know, we are not going to implement TPD2. We don't really want to bother, so we'll sell the business." It's a number of different things. We are somewhat surprised that we've not seen more M&A opportunities come up from new regulation, but we are hoping that they will come in the future. Okay. Thank you, Niels. We have another one from the live stream from anonymous. You mentioned supply chain issues, and I think this is for you, Graham. In your recent results calls being dealt with by the first quarter of next year, is that still the case? I think, thank you for the question. I think with this audience, I want to be really specific. You know, we have supply issues, but into Europe, and they're driven really by three key things. One was a shortage of summer seasonal labor availability at the end of summer. That's solved. The factories are fully crewed. The second one was a delay in shipments coming out of China and some of our key packaging materials. We've built extra inventory to cover that volatility, and again, that issue is solved. The third thing that we spoke about in the results call was a slower than expected ramp-up of machines. Again, that issue is solved, and now we have plans in place to supply the full volume into the market and clear the issue, worst case, through quarter one, and we remain aligned to the guidance that we recently communicated. Thank you. Okay. Thank you, Graham. We have a question from Sean: Given the ERP implementation, would you be willing to do large scale M&A right now? In what areas, geographies, and products? I think that's for you, Niels. Yes. Obviously we are very occupied with planning as well as we can for the SAP implementation, but we also have the fundamental view that we cannot control when the big opportunities arise, and we basically have to manage our way through a situation. Again, we always remind people that just because we buy a company, it doesn't mean we automatically need to integrate it on day one. We have flexibility on how we can organize that, and we would certainly not want to let an attractive M&A opportunity pass because of the SAP implementation. That's our, let's say, our view on the issue of priorities. When it comes to where would we prefer to see the next large transaction, and here I would say that if we had to choose, we would rather do more in the handmade area right now, and especially things in the handmade area that would support further globalization. We will take any type of transaction that we believe is right for the business long term, but that's probably where we would prefer it if we could choose it ourselves. Okay. Thank you. I see still, questions coming in from the live stream. But, any more here from the room? Otherwise, we'll take another one from the live stream. That is: Watching the videos, there's a great luxury goods category pitch here. So how can you best promote awareness, to this? Anything beyond store rollout? So maybe also for you, Nils. Yeah. Thank you. You know, handmade cigars is a luxury category, but it's also a category for everyone. The U.S. is two-thirds of global consumption of handmade cigars, and it's a category consumed, you know, from $3 up to more than $100. Luxury is certainly an element of this category, and we do everything we can to premiumize the handmade cigar category. It's very appropriate that we brought along with us today Sean Williams, who is our Cohiba brand ambassador, and he'll be happy to talk to you about some of the latest initiatives we've done, which is basically placing more, you know, $250 cigar products out there and selling them. We are doing as much as we can to premiumize, but it's also important to remember that it's people from all types of life that smoke handmade cigars, and it's something that actually brings people together across income barriers of all. Thank you. I think with those words we will conclude this Q&A session for now. Again, there will be plenty opportunities later on during the day for more questions. Now we'll take a relatively short coffee break, bone stretcher, whatever that is required, and we will be back here a quarter to three. So thank you. Thank you. Welcome back, all of you, after this short break. Now we are starting the second part of our capital markets day, which will focus on our three commercial units. First, we will have European Branded, followed by North American Branded and Rest of World, and then we'll conclude with the North American Online and Retail. Starting up, I'm pleased to welcome Jurjan Klep, Senior Vice President for Europe Branded. Thank you, Torben. Good afternoon everyone here in the room and the people who are joining via the live stream. My name is Jurjan Klep, and I'm Senior Vice President for the division Europe Branded. I'm with the company for almost 25 years, during which I had several commercial and general management positions throughout the group in various places around the world. During the next 50 minutes, I will give you an introduction to the division that I've been leading since January 2019. What I hope you will get out of this presentation, and what you take away, is that the European business is a strong business and builds on strength. Strength because we are the European leader of cigars with a strong brand portfolio and a strong market position in the key markets. Strength because we have delivered strong financial results and further potential for market share growth. Thirdly, strength because we have been successfully integrating Agio, that made us a stronger business with further potential to leverage on pricing and brand leadership. I will show you several examples throughout my presentation how we're going to deliver this, but let me first give you the highlights of the division. Europe Branded is primarily a machine-rolled cigar business. About three-quarters of our revenue is generated by machine-rolled cigars, and about 17% by smoking tobacco. We contribute to 35% of the group net sales and about 30% of the group EBITDA. What you can see on this slide is that we have been able to grow profits since 2018. With a strong performance through the first nine months of 2021, we already outperformed the full year performance 2020. You can also see that we have a significant uplift in 2020 that followed the Agio acquisition, with a substantial growth in net sales and EBITDA. Let me show you why the Agio integration made such a positive impact on the business in Europe. Because Agio did not only make us more profitable, it also was almost a perfect fit for STG, both on the market, places where they were strong, and the brands. When we took over Agio and closed the transaction in January 2020, Agio was a Dutch cigar business, family-owned, with almost, or just over 3,000 employees and a turnover of close to DKK 1 billion, mostly generated in Europe. This slide shows how Agio had a positive impact on our market share positions in the key markets in Europe. That's the brands Mehari's, Panter, and Balmoral actually contributed very well and fit into the portfolio of STG. What I'm personally very proud of is that we have been able to integrate Agio into STG by keeping our market share and net sales stable, and at the same time, we have been capturing the synergies that we have been promising ahead of time. With the Agio integrated into our business, we believe we have an unrivaled brand portfolio in the market, where we have five strong brands covering all relevant price segments. The market shares that I showed on the previous slides are together and combined a market share of around 33% in our core European markets. We believe that makes us one of the leading, if not the leading, cigar company in Europe. With further potential to drive sustainable profit growth through pricing discipline, legislative changes, and trade partnerships we have in our key markets. On this slide, we also show you the competitors. You can see that some of our competitors are the large tobacco companies that have been in the industry for a long time. The key competition is coming from the small and medium-sized enterprises, mostly family-owned, with local or regional strongholds. We believe that we are in a good position to compete with these companies. One of the companies that we have on the slide here is Mossi. Mossi, and I'm sure many of you have seen the press release that we sent out last week with the announcement that we acquired the majority stake of this company in Italy. Mossi is a relatively new company in Italy in the European market. It has been the first company that successfully entered the traditional cigar market in Italy, and they became a challenger in a market that STG so far didn't have an opportunity to get into. We believe with our muscles, our capabilities, and our competencies, we are able to grow and accelerate the growth in this most profitable part of the Italian market going forward. Moving from brands, markets, and competitors a bit more to the general dynamic of the market in Europe. Historically, we have seen a volume decline of around 3%-5%. More recently, however, we have seen that the market slightly improved. This is on the back of COVID-19, but also because big tobacco entered our market in a number of markets in Europe. We therefore believe that the market decline going forward will be around 3%. It's also evident that we expect more regulation throughout the different markets in Europe, and I think Niels already mentioned it. I think we have a strong track record in adapting to new legislation, not only making sure that we're compliant on time, but actually also to turn this threat into an opportunity based on which we can grow. Let me give you a few examples of this by doing a small deep dive in a couple of our markets. Let's start in France. France is one of the biggest cigar markets in Europe. We are the leader in this market with just over 50% since the Agio acquisition. We have a strong portfolio with strong brands, with Signature, Mehari's and La Paz, covering all relevant price segments. We have the largest dedicated cigar sales force. An example how we have adapted to local legislation is the name change of our biggest brand, Café Crème, into Signature. We did this in a way that we not only have been able to keep our existing and loyal consumers, we actually also gave us a platform from which we could grow further. We also have seen that Big Tobacco entered the French market with new propositions. Also here, we took that as an opportunity for us to drive further growth by going to the market with a proposition that not only actually could compete, but also now is outperforming big tobacco in this category. That's because we have a better product, and we have the focus and dedication to drive this growth. Moving a bit more south to Spain. Spain, for us, also had a significant impact from the Agio acquisition. The market share is almost 25%, but we are a challenger in this market. We have a strong portfolio with the brand Signature, Panter and Mehari's. We have a competitive sales force covering the relevant channels and points of sale. Also in Spain, we have been successful in adapting to new legislation. Also here, the example of Café Crème is something we celebrate in STG, because also here we have been able to change the brand from Café Crème to Signature and creating a platform for which we can drive further growth. I'm talking a little bit about the way we split our markets. What we do is basically split the markets between leader and challenger markets. What you can see here that actually many markets in Europe, we are leaders, we also have challenger markets. The way we approach this market depends on the role and the strategy we give to the market based on their position. You can imagine that where, when we are leader in a market, we actually focus more on pricing and driving profitability. Where in the challenger markets, we are focused on market share growth. The way we look at this is to evaluate if we can drive this market share growth organically or that it is better to buy to buy our market share. I think Mosi, and this is the product that we actually communicated last week, is a good example where we basically made the evaluation that for us, it's better to buy this share than to try to build and enter on our own. When we look at this further translate it this into priorities, I think all our markets in Europe work with the same four priorities, and we basically divided them into four, accelerate pricing, simplify portfolio, win and winning segments, and win the key customers. To what extent we drive these priorities in the markets depends on the position. Let me give you some examples around pricing. Pricing is our most important lever we have in our strategy. This is based on the strong positions we have in several markets. We believe that with the excise increases we see in the markets, we create opportunities that can help us to drive pricing. With this pricing, we are able to offset the total market decline. The way we do this is by building capabilities and investing in insights to make sure that we take the right decisions about this pricing agenda we have. Secondly, a simplified portfolio, and I think Niels already mentioned this, that this is high on our agenda to succeed in. You can imagine when you acquire companies and integrate portfolios, that drives complexity. You also have seen the slide with the many brands we have in Europe, and it is our task and our responsibility to make sure that we simplify this portfolio. What we want is to have less but bigger brands. We also know that with the legislative changes we see in the markets, that our shelf space will shrink, and we need to make sure that we reduce the number of market SKUs, and this is also what we do. Thirdly, to support Graham in driving his efficiency in his factory, we need to reduce the number of pack and cigar formats. All this we have translated in a strategy that we call Portfolio 2025. In this strategy plan, we have a roadmap with initiatives that we have started to roll out this year. Then finally, win in winning segments and win the key customers. We still have pockets of growth in our markets. Traditionally, STG is strong in the non-aromatic, non-filter, more traditional parts of the market. We are actually under fair share in the more growing segments, filter aromatic. This is also where we are investing in pricing and in distribution. With the key customers and building their relationship, we believe we have a further potential to grow our market shares in these winning segments. This brings me actually to the end of my presentation. What I hope you have taken out of the presentation today is that we have a strong business in Europe, and that we have further potential to improve profits and market shares, both organically and via acquisitions. With that, I'd like to hand over back to Torben. Thank you, Jurjan, for this insight to Europe and Branded. Now we will move on from primarily Europe-focused business to North America and Rest of World, which is quite a lot to talk about. Régis, please. Okay. Thank you, Torben. Good afternoon, everyone here in the room. Good afternoon on the live stream. My name is Régis Broersma, and I'm actually already closing in to about 20 years in the company. Had many positions and actually lived for the group in 6 countries. I'm waiting for Niels's call to send me somewhere else again. Let's start. Currently, I'm leading the North America branded and Rest of the World division. In the next 15 minutes, I will give you some insights on what my division is all about. It covers all product categories and a very wide range of markets, about 100 markets. If we start here, the key takeaways that I would like you to remember at the end of the day. First of all, we are the leading provider of handmade cigars in the U.S. We're actually growing also very fast internationally. We do that because we have an unrivaled portfolio of super brands that actually resonate really well with our consumers. A very strong brand equity that we have in our brands. The third point is that we are investing in handmade cigars. We will continue to invest in handmade cigars. This is our must-win battle, and our future growth is actually coming from this category. That is very much focused on handmade cigars and on the U.S. There's a whole wide range of rest of the world, and there are plenty of net sales opportunities there, which I will come back a little bit later on. Also in some of the markets where there's very high regulation, it's all about maximizing EBITDA. These are the four key takeaways. If we then look a little bit at the financials. About one-third of the group's total net sales comes out of this division, but with very high margins and a very low OpEx base, we actually convert that to very high EBITDA. So 43% of the group's EBITDA comes out of this division. If you look on the right side, there's a steady growth in net sales. You see the growth in EBITDA being even faster. Especially in the first nine months of 2021, there has been a big jump, and we're now crossing the 40% EBITDA margin in this division. The question might be, okay, what is causing the jump in 2021? It's twofold. One is that we're actually reaping the benefits of many of the strategies that we put in place over the last two years. Some of them I will come back on later. Second of all, it is also COVID. Some parts of the group have been negatively impacted, some parts positively. Two areas that positively impact this division are handmade cigars. People are more at home, so there's more smoking occasions, so there is a bit of a mini boom. The second one is that all the airports, all the borders are closed, so consumers buying their products in lower-cost channels are now moving domestically. They are forced to buy domestically, where we have a higher invoice pricing and a higher margin. These two reasons are driving the uplift in 2021. About the markets. As the title of the division already says, there are two main regions, one North America, the other one rest of the world. If you look at North America, in Canada, very high market shares. We have one of the biggest sales forces in the group in Canada. Very high regulation, also very high excise, and a very strong position in market share. If we then look at the U.S., we have 5 key business units there. One of them is focused on our mass market products and servicing the convenience channel. And then we have 4 business units that actually sell handmade cigars. Two of them direct our own brands direct to our retailers, and two business units that are basically wholesale business units that sell our own brands, but also competitive brands. We have rest of the world. There we have our own sales organizations in Australia and New Zealand. Like Canada, it is a very strong position. We have our own sales force. It's highly regulated, high pricing, high excise. Very similar. Then basically all the other roughly 100 countries, we have a full distribution network in place. It's not our own sales forces, we use distributors. The main region that contributes to the sales there is the Nordics, and especially Norway is contributing a lot to the net sales in this part of the region. Interesting part here also is contract manufacturing. We put a team in place about a year ago, one and a half year ago, that specifically focuses on selling our idle capacity to basically big tobacco. We had a five-year plan, strategy plan, that was last year. We already achieved it. We have to draft a new strategy plan. This is all about filling our capacity and actually making our factories and team happy on running a more efficient operation. Good. The categories. I think this is the division where it is very equally split between the different categories, so it's each a quarter. But if you look in the two regions, very, very, very different. North America, very cigar focused. U.S., handmade cigars. Canada, machine-rolled cigars. If you then look at the rest of the world, it is basically an equal split between smoking tobacco, machine-rolled cigars, contract manufacturing, and accessories. Each one third. Very different setups. Let me walk you through this slide. Here we show how each area is contributing to the division's net sales, the growth for the future, and how it contributes to the average gross margin of the division. Let's start on the left side. About a little bit more than 50% is actually being sold via North America. And the biggest chunk there is handmade cigars with 26%. Rest of the world, a little bit less than 50%, and the main driver there is the Nordics, especially Norway, with about 10%, and the conversion to EBITDA is even higher there. A very important market for us. Where does the growth come from in the future until 2025? That is from handmade cigars. It is one of our must-win battles. That's where we invest in, and that's where we expect also the growth to come from. Another one that we have is other markets. There's, as I said in the beginning, net sales opportunities in different pockets. That is in South America, that is in Asia, and that is also in contract manufacturing. Then the other areas, like U.S. mass market, Canada to Nordics, Australia, and New Zealand, they're characterized by very high regulation. It is plain packaging, dark market, high excise, and the markets are there a bit under pressure. That's why this one's a little bit lower than the average growth of the division. If we then look at gross margin, basically all the areas contribute positively except for other markets. The reason behind that is, as I said, we have a distributor network there. We sell at a lower invoice pricing, lower margin, but we don't have the OpEx base because we don't have our own sales force there. On top of it, of course, we have contract manufacturing, which in business model is always at a lower margin in itself. What should drive the growth of the division? We basically based it on three pillars. One is accelerate handmade cigars globally with a focus on the U.S. and with a very strong brand portfolio. The second one is what I mentioned with the markets where we have a high regulation. That's where we need to maximize for EBITDA. That's pricing, design to value, simplification, OpEx reduction. With releasing that cash, we can actually, with key pillar number 3, we can actually invest in net sales opportunities across the group, but also within the division. On the next slide, I actually highlighted for each three main initiatives that we have initiated and also executed in 2021. I will not go through all of them. I will pick two. The first one is the launch of Forged Cigar Company in February 2021. Before that, there was one selling company selling all our handmade cigars that we have, handmade cigar brands. The basket was so big that when the sales rep came to brand number 5, 6, 7, 8, the customer was really like, "Okay, this is too much." Brands like La Gloria Cubana, Partagás, El Rey del Mundo, they didn't get the attention they deserved, so it didn't release the potential of those brands. What we did is we moved those brands to a nationwide new company called Forged. Since, what is it now? 9 months, it has surpassed every KPI that we put in place. As a result, we actually are now expanding with new feet on the street. Great success story. Then on the right side, we have Versa Hemp, and Niels was so kind to already discuss it. This is coming out of the growth incubator. Also there we have now a dedicated team. This is where we combine the skill set that we have, the expertise in blending and casing of pipe tobacco, more than a hundred years. We combine that with hemp flower, and it truly creates a unique smoking experience. Still small, with the potential to be a very profitable category in the future. Let's deep dive a little bit in the U.S. handmade cigar market. On the left side, you see some of our power brands, like Cohiba, like Punch, like CAO, El Rey del Mundo. It's great that Sean is here for Cohiba, and he does sell the $250 cigars, which is great, which we launched last week. On the right side, you see some of the competition. Davidoff, Oliva, Altadis, bigger companies, and then you have a lot of boutique companies also. With the split with Forged Cigar Company, we have two selling organizations, and we can both fight and win versus the big companies and the boutique companies. The total market in the U.S., we have estimated that now at 360 million cigars in 2020. That has increased. The great thing is we have increased with the market and actually outperformed. We now hit 100 million cigars sold in STG handmade cigar brands in the U.S. That's a very nice milestone. Good. The channel distribution. Where is handmade cigars sold? You see that on the left side is the total market. 40% of all handmade cigars are actually sold in retail. Brick-and-mortar, moms and pops, the liquor stores, and 60% is sold in the internet catalog channel, of which Sarah will come back to. She holds about 50% of that. 40% retail, extremely important. If a consumer, new consumer comes into the category, they will first go to the retail channel. They get the advice. They get educated, and over time, they migrate actually to the online channel. Really important that we are present there, that we intercept the consumer for the future. On the right side, we focus on the 70% 'cause Sarah focuses on the other 30%. Within that 70%, our split is on the right side. Here we see a quarter is basically internet catalog, Sarah's competition, and 75% goes to brick-and-mortar and retail, either by distributor or us directly supplying it. It's a very high percentage, which is great because this is where we intercept that future consumer. The great thing about the U.S., there's not that much regulation yet in consumer engagement, so there's a lot of things possible still. That's why each of our brands has a 360-degree consumer engagement program where they have to touch on these six items that are on the screen here. Just a few examples. Innovation collaboration. Very often when a consumer comes into the store, he or she will ask, "What is new?" There's like 10,000 products on the shelf, but they want to have what is new. Innovation, extremely important, and we have upskilled our capabilities there and increased the percentage of innovation. This is tobacco innovation. This is packaging concept innovation, but also collaboration with other companies and brands that are affinity brands with some of our brands. That can be Weller, Rabbit Hole Whiskey, S.T. Dupont Accessories, Louis XIII. We have sponsorship and experimental. A good example there is Barstool. Barstool touches 1/3 of millennials in the U.S. It is very powerful. We just finished our 1-year program with them, and also there, all the KPIs that we set there, we have overachieved. A great vehicle there where we actually target our target group. We are actually capturing our target group. The last one is digital social influencers, so connected. Here we upskilled a lot in the last couple of years. Each brand has a Facebook, Instagram, Twitter. Name it, they have it. We actually all put it into cigarworld.com, which is an overarching platform where all our consumers can go to, our current consumers and our future consumers. I can talk hours about this slide, but sometimes a small video says more than a thousand words. Original video was actually also a few hours, but a minute is good. Thank you very much. More than happy to answer questions on there later. For now, back to you, Torben. Yeah. Thank you, Régis. Thank you also for this video. Really and truly American, I would say, so thank you. Now we will stay in the U.S. and I will now pass the word to Sarah Santos, that is going to talk more about our online retail channels. Excellent. Thank you. Good afternoon. As Torben said, I'm Sarah Santos. I'm a Senior Vice President also on STG's Executive Management Board. Since January of 2020, I've been the President of the North America Online and Retail Division. Been with the company about 19 years and held various positions. Prior to that, I did the same for several other multi-channel retailers. Today, I'm gonna start off with what I'd like you to take away today. That is that STG is in a lead position in the U.S. handmade market online. We're an omni-channel business and we've got a growing retail component. Despite our lead position, we're optimistic about further growth in the online channel. Let's get into the details. The division accounts for about 1/3 of group revenue and over 1/4 of the group's EBITDA. Our main product category is handmade cigars, by far, followed by accessories, which includes items like humidors, cutters, lighters and the like. As you look to our recent performance, you'll see in 2019 that on top of organic growth, we also realized synergies from the Thompson Cigar acquisition. Moving forward to 2020, multiple factors were at play. Our bottom line certainly benefited from scale as retailers transitioned from brick and mortar to the online channel. Our top line benefited from increased smoking occasions for consumers, which raised basket sizes, as well as a reduced promotional stance. Moving into 2021, Q1, we saw a similar dynamic to 2020, and in recent months we have seen a portion of consumers' wallet share transition back to our retail stores, as you saw in Régis' results. The division's comprised of five distinct business units. The flagship amongst them is Cigars International, which is omni-channel and celebrating its 25th anniversary this year. 10% of the sales for this business unit come in via phone calls to our contact centers. 7% of the sales come through our retail stores and the balance online. The other business units in the division reflect a strong history of M&A integration, starting with the most recent, the major acquisition for the division of Thompson Cigar in 2018, followed by Pipes and Cigars, an acquisition in 2013. This is a business unit where nearly 90% of the sales are pipe and pipe tobacco products. Next, we've got cigar.com in the portfolio since 2005. Last but not least, CigarBid, which is a wholly digital auction proposition. Many media, including Google and the major social media outlets, prohibit the advertisement of tobacco products. As a result, catalog marketing direct to consumers, which is permissible, is the lead influencer of sales in the division, followed by email and traffic driven by search engine optimized content. When we look at the online competitive landscape, we make up 46% of the online channel. Of that, Cigars International alone is 25%, leaving a pretty large delta between ourselves and the next largest competitor. As you look at the pie, there's a large slice that's comprised of many smaller retailers who originated and still remain with a foothold in brick-and-mortar retail. This is a slice of the pie in recent years we've seen grow, particularly during COVID, as shopkeepers adapted and put up their own web shops. What differentiates us from the smaller players in the category is a strong proprietary brand portfolio. Our sales are comprised of 35%-40% proprietary brands, and another 16% comes from our North America branded General Cigar and Forged Cigar portfolio, leaving about 35%-40% third-party manufactured products. While the category is traditional in many ways, it's quite mature in that pre-COVID, we were already seeing 60% of the volumes move through the online channel. Let's take a look at our consumer file. When we began to see the impact from COVID, it happened to coincide with a refresh of our digital propositions. The two combined have led to our active consumer file, topping 1.4 million consumers, and our retention rates have grown above 60% and have been sustained. This is a quite strong retention rate for an e-commerce retailer, so I'm quite pleased with that. If you look to the value of our consumer file, while we've seen material sustained improvements in our basket sizes over the last 18 months, over time, the revenue generated per consumer, as well as their contribution, was quite stable and predictable over time, growing as the years go by that they engage with our businesses. Another distinguishing characteristic of our multi-business unit online division is that we have a focus on consumer segments. This was the creation of a project we call Project Winston, named after Winston Churchill, which is appropriate given our location today. We even got to see a statue of him during some sightseeing this weekend. The purpose of Project Winston was to further delineate our online propositions from one another and focus on particular consumer segments. In establishing that proposition, we analyzed over 20 variables to determine which drove significant differences in consumer behavior. For example, we found that age does determine a significant difference in the price paid per cigar, as well as the number of cigars consumed per year. There we go. Some other examples include consumer segments that are quite exploratory across brands and others that stick within a tight assortment of products that they know. A couple examples of how we've delineated our online propositions include our Thompson Cigar business unit that focuses on Steadfast Dans that stay in that tight assortment, offers a continuity program, offering automatic shipments at a cadence of the consumer's choice. Now when we look to our cigar.com proposition with a focus on Hot-Shot Charlies who desire the status that is unlocked in the upper tiers of that division's loyalty mechanic with early access to new-to-market products, as well as access to rare and limited edition products. This is an area that I could go on quite some time about, but I'll leave it at those examples, and if you're interested in more, I'll take them during questions. In order to create and adapt these propositions, we needed to assemble a deep business intelligence and analytics capability. We did this through a combination of ongoing testing, consumer insights, as well as machine learning that we apply in the form of personalization. While the benefits from that personalization are driving the increase in basket size as well as retention rates, they ladder up to an increased lifetime value from consumers over time. In the future, you can expect to see further investments in these areas, particularly in the area of pricing, where you may see dynamic pricing that's cued off signals on supply and demand, particularly in the tail of our portfolio. We combine the insights generated from our online division with those in the retail channel. Some of our findings are that a third of consumers only engage with the online channel, a third only engage with brick-and-mortar, and the remaining third participate in a hybrid of both channels. As Régis began to mention earlier, we found that consumers begin their engagement in the category at brick-and-mortar, and they continue to purchase the majority of their cigars there until they've been in the category from 5-10 years. We see the inverse, where a larger portion of their cigar volumes are purchased online. While a larger percentage of cigars are purchased online, we estimate the value of the two channels to be quite similar, although the margins and EBITDA at retail are higher than those seen online. Thus, we see this as an untapped value pool for STG. Today, our retail footprint stands at seven stores, of which six are superstores. The most recent four were opened in the Texas and Florida markets, and the previous three were in Pennsylvania. With the recent openings of stores, we were able to assess the financial returns of the stores as well as the impact on the catchment area in which we open them. We'll take an example with The Colony, Texas location, which was opened in 2018. Through this location, we confirmed that the Cigars International retail experience appeals to a broad segment of consumers, and it's got a draw from over a 30-mile radius surrounding the store. May seem like a large radius for a retail shop, but keep in mind that there's fewer and fewer areas to smoke publicly due to smoking bans. We've also found through opening the recent stores that there is an initial dilution of our online share in the year following opening. After that year, we see a strong halo effect to the tune of double digits. The Colony store, which just had its three-year anniversary, has delivered 25% ROI during that period. Because the borders to the U.S. have been closed down until very recently, I don't assume many of you have had the opportunity to come experience one of our stores. I've brought a short video with me to give you a peek inside. We recently opened our newest store in the retail division, and that's in The Colony, Texas, which is just outside of the Dallas-Fort Worth market. We're very busy here at The Colony, pleasingly busy here at The Colony. I would say on an average week, we see anywhere from 1,000 to 2,000 people coming out to these stores. We don't sell cigars. We want to sell an experience. We want everybody that walks through our doors to feel happy, welcome, and just love being here. In conclusion, we've been seeing the retail stores deliver the expected results, and we're expecting to open another 6-8 stores over the next 2-3 years. We'll continue opening those stores in the areas where we have infrastructure established initially. Each of those stores will require an investment of $4 million-$7 million and will cover things such as the initial lease obligation as well as our beginning inventories. Those stores are expected to deliver above a 20% ROI within their first 3-5 years of operation. In order to achieve our strategic must-win battle of growth in handmade cigars, we will couple this retail expansion with an ongoing data-driven consumer focus in our online channel, with focus on continued testing, personalization, and maturing of our loyalty mechanics. Thank you. With that, I'll hand it back to Torben. Thank you, Sarah. Thank you, Jurjan and Régis. Now it's time for our second round of Q&As. We will have 10-15 minutes for that. Once again, if you have a question here in the room, please raise your hand, company and name. For those following us on the live stream, you know the drill. You have the QR code and also the Slido. I think I'll start to see if we have any questions here in the room. Yes. H`i, this is Pallav from Barclays. You mentioned that the U.S. mass market cigar is expected to grow below the group divisional average. Would it make sense to combine with the cigar business of Swedish Match once that is spun off next year? Yeah, I think you can start, and then notes can continue. Maybe to repeat your question on the handmade, was it on the handmade cigar market? Mass market. Mass market. Okay. For us, our presence in the U.S. on mass market machines cigars is really limited. Basically, we pulled out because it's either invest for 10 years a big acquisition. Yeah, of course, you mentioned Swedish Match comes up. In principle, we don't comment really on ongoing discussions on specific targets. Yeah, cannot really comment on that one. Would it supplement nicely? Probably yes. Yeah, we have to see. If I can ask one more question on the iSub acquisition. In a number of European countries, the market share grew significantly, but in U.K. it has been flattish. Why is it different in U.K. versus Italy, France, and other countries? Thanks for the question, and I think it's basically quite a simple answer because iSub was quite small in the U.K. STG already had a significant market share, but we saw very little impact from the iSub transaction into the U.K. market. I hope that answered your question. Okay. I can see there's a lot of questions coming in from the live stream, so I think we'll start with the first one. That is, how has big tobacco entering the machine-made cigar market, we call it machine-rolled cigars segment, how has that caused volume decline in Europe to slow from 3%-5% to 3%? Please elaborate. The question really is their entrance into the machine-made market, how has that kind of changed the overall market dynamic? Yeah. Also this, I think is a very good question, and thanks for that. So let me first of all say that we saw the market trend improving in general, throughout the last few years, and that both is on the back of COVID-19, but indeed also driven by the entry of big tobacco into our category. I think what you should realize is that the cigar market is a niche market, and when big tobacco is entering our market, with their muscle, they can build distribution of a new product relatively quick. Our business relative to cigarettes is very small. When they launch the product, they actually have a significant impact on our market, and they create new segments that we also can tap into. That is basically driving that the market decline has slightly improved, and therefore we also say that it goes from -3% to -5% to -3% going forward. Maybe just again for you, Jurjan, here. A follow-up on this is, how sustainable do you believe the new decline rate is in machine-rolled cigars in Europe, and has it really changed the outlook for the division? I think you have addressed it slightly. Let me first of all, you know, say that we cannot give specific outlooks for our division going forward. But I believe that this is sustainable. The reason I believe it is that we already have seen the first significant impact following TPD2 implementation in 2017. The product that had grown in a number of places actually is still there. We believe therefore that it is sustainable, and we also see it with the growth of our own products that we launched in this particular segment. Perfect. Thank you. I think we have a question for Sarah, and that goes for the store selection or location selection. What really drive your decisions on picking one selection from another? Excellent question. We use a data-driven scoring methodology leveraging a third-party partner. Some of the factors that go into the store location, certainly population, income, traffic, things of that nature. We've established an algorithm, and we leverage inputs from third party. Yeah. Thank you. Thank you. I think we'll take another one from the live stream before seeing if there's anybody in the room here, and that is for you, Régis, I think. How confident are you that the sustainability of the higher U.S. demand for handmade cigars is going forward? Yeah. We actually believe this is sustainable. We believe that there is an uplift during the COVID period, and we believe that the current level is actually the new normal. We do believe this is sustainable. On top, if there would be a drop, we have so many activities in place and strategies that we will be able to compensate that, if that happens. Okay. Thank you. Just to ask if there should be any questions in the room. Yes, Gerry? Excuse me again. I've got no knowledge whatsoever of the cigar consumer in Texas relative to the one in Florida, relative to one in Pennsylvania. The fact that you choose Texas and Florida doesn't surprise me. What is it about Pennsylvania? I've got excise in the back of my head. Could you talk about what, why Pennsylvania works? Absolutely. Good question. You are on the right path. All of those states have low excise tax, actually none, in most cases. Pennsylvania was. It's the origination of our retail stores simply because it was our backyard, and operationally it was easy to execute out of our distribution center. There is also high consumption in Texas and Florida. Thank you. I think you just should stay on stage for just a while, Sarah. Sure. Because there's a question here again from the live stream. What's the end game on the retail expansion, and how much will it contribute to divisional sales? Yeah. Right now we envision 20-25 stores in the next five or so years. As you saw in the presentation earlier today, our 7 stores account for 7% of our sales, so you can sort of use that as a gauge for what to expect in the future. Yeah. Okay, thank you. We have one question here from Andre. Looking at your rest of world business, what would make an attractive market for you, not only to keep it as a rest of world with a separate distribution, et cetera, but to actually enter it properly, much like you did, I don't know, France, U.K., Germany, for instance? Yeah. That's a good question. In principle, what we're doing right now is that, as well as, we have certain pockets of net sales opportunities, like in Asia, like in South America. The key is to get critical mass there. Those markets are relatively small, which needs to be nurtured and, basically grown up. It is about, yeah, is that gonna happen in the next few years? Maybe, maybe not. It's really about if a market takes off or not. This at the moment really about selecting the right distribution partners that we have, and we prefer to have a distribution partner that covers multiple countries, and build it like that. Okay, thank you. Yeah. We have 2 questions for you, Jurjan. First of all, how much is the acquisition of Mosi growing your market share in Italy? Yeah, thanks for that question again. Of course, we are very delighted with the announcement last week, where we announced the acquisition of the majority stake of Mosi. We are not disclosing any market shares locally in local markets. What I can tell you is that the Italian market, and if you look at that market, that volume-wise, the segment that this product is playing into is maybe about 25%. However, the value of this market is between 60%-70%. What we're looking at here is driving value and not so much a volume share. I hope that that has answered the question. The next question is on the Café Crème name change to Signature in France and also for that matter in Spain. Is that only in those two markets, or have you done it in other markets as well? How did it actually impact your net sales? Yeah. What we have seen when the Tobacco Products Directive was implemented in 2017 is that some member states put more pressure on the name change of Café Crème than others. Here we took a prudent approach and mitigated the risk by changing the name Café Crème to Signature in all our markets in the EU. The question here also, did it have any measurable impact on sales? Well, we didn't see a negative impact on sales. Actually, what we have seen by changing the name, we believe we actually had a positive impact on the brand. The Café Crème brand was quite a traditional and old brand built around quite a traditional part of the market, in which Signature actually we have created the potential for further growth. Actually it had the opposite from a negative impact. Okay. Thank you, Jurjan. I think unless there are more questions in the room here. Yes, Andre, another one. You go. Yeah. You mentioned earlier that you work together with Louis XIII. Did I hear correctly? Can you elaborate on that, just for my curiosities? Yeah. On that one, we have that with many brands, with the Rabbit Hole, with Weller, a lot of affinity brands that our consumers are connected with. Louis XIII, we do use that partnership with brand ambassadors. When we go to store, when we do our events, when Sean is doing his Cohiba events, we do have Louis XIII present. That's U.S. only, right? U.S. only. Yeah. Yes. Okay. Thank you. I think we will take a stop again, just a short break. We will be back here five minutes to the hour. After that, after Marianne's presentation, there will be plenty of time for more questions for all of them. Thank you. Again, for now the final session of our Capital Markets Day. Now we will turn our eyes to the financials, where Marianne Bock will go through our financial achievements and also some of our financial ambitions and go more into detail with that. Please, Marianne. Thank you, Torben. Good afternoon, everyone, both to all here in the room and also on the live stream. My name is Marianne Bock. I have been with STG for three years as a CFO. I am a certified auditor by background, though it is ages ago I left that sector or industry. I have spent the previous 25 years in manufacturing companies, all companies undergoing large transformations and all listed on the Danish Stock Exchange. In STG, I'm responsible for finance and IT, and compliance, as well as internal and external communication. I often get the question, why move to STG three years ago? I didn't intend to find a new job three years ago. Niels invited for a cup of coffee, and coffee is always nice, even though I said to him, "I'm not gonna move." A couple of hours with Niels changed the picture. I think the passion that Niels showed for our products, our consumers, our employees, but most importantly, also the vision that Niels had on where we could bring STG and the potential of STG simply changed the picture, and I joined, and I haven't regretted one single day. Enough about me. The key takeaways that I would like you to leave with today is we like to cement the history of a very strong financial performance and stakeholders, shareholders return. In 2016, when we were listed, we defined a capital allocation policy that is attractive to shareholders, but also allowing for M&A and also allowing for our organic growth. We have a strong cash flow. That cash flow, and with that cash flow, we are able to invest in growing our top line, but also investing in efficiencies within our company. All that supports our financial ambitions, and I hope that during this presentation will give you more insights into how we are believing we can achieve our financial ambitions. We have a track record of a strong financial performance. We have, over the last five years, on average, grown our organic EBITDA growth with more than 5.4%. Adjusted EPS growth, we have grown more than 5%, while our cash flow has increased to DKK 1 billion on average each year. The year 2020 and 2021 has been significantly impacted by changed dynamics in our markets due to the COVID-19 pandemic. These two years are to be seen as exceptional years with very high growth. Regardless of that, we're very, very proud of our financial performance over the last five years. The strong financial performance supports our attractive shareholder returns. Our return on invested capital has been increasing due to increasing profitability. Return on invested capital is a new metric that we wanna focus on, and we will continue reporting on. Talking about capital allocation, we believe that we do have an attractive capital allocation policy, and we have, over the last five years, including this year, returned more than DKK 4.5 billion to our shareholders. The strong financial performance and our attractive shareholder return are all supporting our financial ambitions. Our ambition is to grow EBITDA organically on average 3%-5% annually. This also implies that there could be years where we are below 3%-5%, but also years where we are above 3%-5%. With EBITDA growth, consequently, cash flow before acquisition and sizable investment will also grow. The return on invested capital, we also have the ambition to grow that. As I said before, that is a new metric that, we wanna follow up closely. We do not have a target yet. We are in the process of defining our approach to return on invested capital internally, but we do have the ambition to grow the return on invested capital. Just going shortly back to EBITDA growth. When we talk about acquisitions, the synergies coming from acquisitions are not included in the 3%-5%. These will come on top of the ambition of growing 3%-5%. All our divisions will contribute to the growth of EBITDA of 3%-5%. When we wanna grow 3%-5% in EBITDA, it does require that we see a slight growth in net sales, but also margin improvements on a group level. Each of our division has their own characteristics, which Jurjan and Sarah and Régis has explained very well during today's presentations. Europe Branded, a leader in the machine rolled cigar market in Europe, committed to sustainable growth coming from strong brands, disciplined pricing, and optimizing cost bases across markets. Europe Branded will show an increase in net sales below the group average, but a margin improvement above group average. North America Branded and Rest of the World delivers to all sales channels in the handmade market in U.S., enhancing growth across these channels. North America Branded will show a growth in net sales at group level and an improvement of margins also at group level. North America Online and Retail drives the online business in U.S., delivering present categories, but also new categories on that online business supported by our retail network. North America Online will deliver an organic growth above group average, but a margin improvement below group average. All division will deliver to our ambition of growing EBITDA with 3%-5%. Let me turn to our cash flow. In a normal year, we believe that we'll be able to deliver a cash flow, core free cash flow above $1.5 billion. We generate $2.2 billion in EBITDA. Financial items deducted with $100 million, tax with a tax rate of 22%, and maintenance CapEx of $150 million results in a cash flow above $1.5 billion, a strong cash flow. Our strong cash flow combined with our leverage ratio target of 2.5x is very supportive of our M&A strategy, but also shareholder returns. We do maintain the flexibility to increase the leverage target of 2.5x in connection with M&As. It is, though, also important to say that we are mindful of our investment grade rating, and we do not wanna jeopardize that. We maintain a disciplined capital allocation strategy. We wanna create value through increasing return on invested capital. In our capital allocation policy, we remain committed to increase our ordinary dividends slightly year-over-year from the current DKK 6.5 per share. We are also committed to return excess cash to our shareholders via share buyback and/or dividends. We do prefer share buybacks. It gives us the flexibility in connection with M&As. M&A is what STG is built on. It is part of our DNA. It is an integral part of our strategy. We have been part of consolidating this industry for the past 10 years, and we have shown that we're successful in integrating M&As. The recent biggest acquisitions is the Thompson Cigar business, or acquisition, that Sarah has also talked to, and the Agio Cigars in the Netherlands, that Jurjan has talked to. Thompson Cigar acquisition, we bought back in 2018. This was a family-owned business, with an online platform and a very strong consumer base. The value of this acquisition was $62 million. It increased our revenue with approximately $100 million. The EBITDA on a standalone basis was close to zero. We committed to increase that EBITDA to an EBITDA margin of 15%, and the value in this acquisition was coming from integrating the commercial and the back offices, as well as warehousing and shipping facilities. In 2020, we acquired Agio Cigars in the Netherlands. Also here, a family-owned business. The fit with your brand, as Jurjan has also told you, was more or less perfect geographically and brand-wise. The value of the acquisition was EUR 210 million. It increased the revenue of STG by approximately DKK 1 billion, and the EBITDA of Agio on a standalone basis was approximately DKK 200 million. We committed to releasing synergies of DKK 225 million, and during the process, we increased that to DKK 250 million. The value from this acquisition was also coming from combining our sales forces, integrating back offices and functions, and optimizing our manufacturing footprint. End of this year, we will close the last plant in that plan, and after closing that plant in Holland, we have finalized our full integration, and we have delivered on the DKK 250 million that we committed to do. Both these acquisitions has shown to give a return on invested capital in the level of 20%. Agio and Thompson Cigar was fundamentally two very different acquisitions. When we look for acquisition, we look for acquisitions in three areas: in the handmade market, in the machine-rolled market in EU, and in the U.S. online business. Our rationale for M&As is to strengthen our core, to grow market shares, and also deliver significant synergies. Our approach to M&A is very structured and disciplined. When we screen targets, we do that strategically and structured. When we enter into negotiations and deal execution, we do that well prepared. We bring our industry knowledge. We have core competences within a valuation, and we do it with thorough due diligence. When we close deals, we have a defined set of integration principles that we have shown work well in the past. Before I wrap up and go to my final slide, I know that from investor meetings that a lot of investors are interested in a completely different topic, our new ERP project. We have today 12 ERP systems that we wanna replace with a SAP S/4HANA Cloud solution. This is a key enabler for our strategy execution. It will enable us to build a more efficient company, but it will more importantly enhance the speed with which we can integrate new M&As. The faster we can integrate M&As, the faster we can release potential synergies. We are well on the way with our project. Right now we are scoping, preparing benefit cases and implementation plans. We expect to do the first go live in the end of 2020, and then with a three-year implementation plan. You cannot talk ERP projects without talking risk. We wanna mitigate risk in such a project as well as possible, and we believe the best way of doing that is to implement a simple core. Different exciting solutions that might bring potential benefits, we will postpone until we have implemented a simple core successfully. We will continue to the more exciting solutions. We believe that is the best way of migrating any potential risk. Coming to my last slide and summing up, we have shown a strong financial performance and also shown attractive shareholder returns since the listing in 2016. We drive our business being focused on growing earnings, increasing cash flow, and increasing value through an increasing return on invested capital. We commit to a disciplined capital allocation strategy where we focus on value creation and shareholder returns. We are also committed to disciplined M&A approach, where we ensure that we create added value with the acquisitions that we do. This concludes my presentation. It also marks the end of all the presentations on this Capital Markets Day. We will go into a Q&A session now with all presenters present. With this, I will hand the word back to Torben. Thank you, Marianne. As said, thank you, sir. I will ask all presenters to just stand up so you are prepared for any question that might just come in. Again, we have both the live stream opportunity through Slido, but also anybody that wants to ask a question here from the room are more than welcome to do so. I think we'll start with one on the Slido, and that's on North America Online and Retail. Can you please say a little more on social media strategy and influencers? Is this advertising channel only relevant to this division? Ah. Yeah. I think maybe it's for you, but also maybe Régis can elaborate. Exactly. It's absolutely relevant to the North America Online and Retail Division. Influencers play a role because paid advertising through social media channels is prohibited. This is an area where we're increasing our maturity, and we're already seeing benefits from doing so. As Torben mentioned, it's also part of the North America Branded Division strategy. Definitely not only Sarah's division, also my division. We actually diverted quite some investment funds to the social media strategy. What I said, cigarworld.com, every brand has their own platforms in Instagram, Facebook, websites. On the influencer part, it is not only influencers that are on Instagram, but this is also like the shop clerks, for example, that influence in store to get the consumers to our brands. Sarah, please stay on stage here. Yeah. Because there is another one that is on the retail store expansion. You mentioned 20-25 stores in a five-year perspective. Mm-hmm. Can we count on this? What factors would prevent this from actually happening? Yep. 20-25 stores is our ambition over the next five years, and we'll deploy those in accordance with our capital deployment strategy as Marianne described. No? Okay. Mm-hmm. Yes, please. Yeah. Maybe I think it's relevant to add on the stores that we constantly debate what is the real potential for the number of stores in the U.S., and nobody has an accurate number. As Sarah explained, we have a data-driven approach to find out what are the right locations, how fast could we expand, and we'll do that based on the evidence that comes from the current stores. What we said in the beginning is we built 4 test stores. You know, they've been set back a little bit due to COVID-19, but we're very confident that they're doing what we expected them to do. Now we're moving to phase two, which is 6-8 stores in the next two to three years. In that same period, we continue to generate New potential venues. We keep refining our model for what makes a perfect store. The current thinking is that the 2025 stores in the U.S. at least is the potential that is there. I think that 2, 3 years from now, we'll be able to give you an even more precise number. Also as I confirm whether all stores are doing as we expect them to do. We're being, how can you say, cautiously bold, is maybe the best way to put it. Maybe, Niels, you could stay on stage because here are some more M&A related questions. First of all, are you only planning to make acquisitions within cigars? Régis explained some of our thinking about moving into new geographies, be it Asia, be it South America. I think we're at a stage where we're beginning to look at these geographies to figure out what are the right way to get feet on the ground. Because there's a big difference in these countries between, you know, covering with export sales versus having feet on the ground, generating local ideas, being able to influence, local legislation to change excise taxes. We had an excellent example recently of where, you know, one of our employees went to talk to the EU around, import duties, on cigars. As he was having the conversation, he was finding that they were very receptive, and he was asking them, "Why is there one rule for cigarettes and another rule for cigars?" The guy said, "Well, you know, they asked for a lower percentage, so we gave them a lower percentage. We never heard from the cigars." Right? My point here is that there is lots of influence still to be had with legislators, also in Asia, also in South America. Today, most of the rules are not in our favor. To really influence that in an effective way, we need to get local, and that's also where you could see potential acquisitions. I think the question is also around, you know, would we go and buy something in an entirely new category? As I said before, you can't rule that out, but it's not the playbook number one. You know, we build on the basis of strength we possess, and if we can support them by acquisitions, we'll look at that. I think it's way too early to speculate about us making any acquisitions outside of cigars. Cigars remain our core business. Maybe, Niels, another way to kind of question the possibility of expansion, is there any plans or thinking about expanding the online business to, for instance, Europe or Asia? I think that the rules for running an online business outside the U.S. are very different from the rules running it in Europe. Running it in the U.S. is very different from running it outside of the U.S. I think before COVID-19, my own view was that it's not really worthwhile looking at online opportunities outside the U.S. Today, with COVID and the additional acceleration we've seen through with COVID-19, I think it is an area we will look at. Again, I don't think that it's a super high opportunity short term, but it's one that we need to mature along with other opportunities that we can see out there. Thank you. Lots of questions coming in from the live stream, so but just want to make sure anybody in the room wanting to ask a question. Otherwise, I think we'll just take another one from the live stream. This is for you, Marianne, on the ERP investments. Total CapEx and how will these be allocated until 2024, 2025? Good question. The total investment for the ERP, what we announced last year in our annual report, was DKK 280 million-DKK 340 million. We are just now refining our plans. I do not expect that number to change significantly, but you should go for the higher part of it. The allocation will be approximately DKK 100 million over the next three years. That's as much as I can say now. When we come to the annual report in March next year, we will have laid out the implementation plan, and thereby also I can be much more precise on the capital allocation over the future years. Maybe again, Marianne, another question relating to investments. Now the question is on these 2025 retail stores, whether we have the cash reserves already factored in. I think the question is that part of this DKK 1.5 billion that you're mentioning, if we're going to invest in these many stores? Yeah. These are not part of our one point five million, because the 1.5 million that I mentioned was before a sizable investment. We do have such a strong cash flow that if we decide to implement 20-25 new stores during the strategy period, we will have the cash for that, also without it hurting any shareholder returns or potential for acquisitions. Perfect. Thank you. Anyone here in the room? Yes, Gerry? Sorry, I've got another M&A question. Could you talk a little bit about the level of competition for whatever assets are available and how that competition has maybe changed in intensity or not over the last couple of years? Yeah. I think that the best way to express this is that we see sporadic interest in various acquisition candidates. You know, we try to be extremely disciplined and also patient when we go to this acquisition opportunities, because we still believe that nobody is fundamentally a better owner of any of these assets than we are. If I am right in the fact that we can operate any cigar business more effectively than any of our competitors, if we are, you know, world-class working capital, you know, or not world-class, but let's say best in class working capital within this industry, all of these things make it very difficult to be up against us as a bidder. At the same time, we also don't want to overpay. You know, we are buying assets in a category with, you know, with a risk profile that is different going out. You know, we try not to do stupid things. But we certainly don't see a lot of interest in the same type of assets. Okay. Thank you. I think we are getting close to a conclusion of the day. Unless. Yes, Gerry? Sorry, one more. You've been listed now for over five years. You were held privately or semi-privately before that. Niels, could you talk a little bit about how the culture of the business has changed? How the people have developed, the feeling within the business, all that soft stuff which is a bit soft for us people, but nevertheless is very, very important. Yeah, if I understand your question correctly, Gerry, you're basically saying, you know, how has it changed the company becoming public versus the previous ownership? I think, you know, one of the big changes you experience is that, you know, everyone's attention is on you all the time. The organization has been somewhat distracted by the fact that even though we don't manage the company quarterly, we do care about each quarter. My job and the rest of the leadership's job is to make sure we keep our eyes on the long-term success and not, you know, get distracted from the short-term things. I think that we have not had as many changes from becoming listed as we've had from the transformation programs we've implemented. Because going from a decentralized operating model to a global operating model, centralizing a number of things like procurement, strategic planning, all these things, have led to more people leaving us because we're running the business in a different way. We basically, you know, I always say that we've gone from having good people employed to having specialists employed. It's not no longer enough to be a nice individual and good to be around. You now need to be a specialist in Lean or in procurement or in IT to be around. That's some of the changes that we've seen. I think that the organization is coming nicely together around, let's say, the project. It also helps that we've done well in 2020 and 2021. It raises the whole ambition level from everyone. People can see that the project is doable. I think we have one for you, Régis. That is on innovation in handmade cigars. How much room is there actually for innovation in the category considering FDA and Deeming regulation? The FDA regulations are still Deeming, so they're not implemented yet. At the moment, we can still do all the innovation that we desire. We are prepared because it's all about predicate blending. The definitions have not been published yet by the FDA. We're ready, but we'll still also be able to do innovation going forward. Okay. Thank you. Then I think it's for Marianne. STG has a huge surplus cash flow and seems to be under-leveraged. Is it possible to reduce the equity base faster than the current share buyback? Thank you. Not a surprising question. As I also said in my presentation, we prefer share buybacks towards dividends, also extraordinary dividends. Yes, I do believe that there is room for increasing our share buyback at least slightly, and that we will be focused on doing. Okay. Yes, Andre? Looking at the, let's say, less popular categories in your geographies, let's say handmade in Europe and rest of all, do you think there is long-term room for them to be developed and become more popular, at least in the handmade? Sure. I think maybe, for you, Régis, and When I actually showed you the three key pillars that we are driving. The first one is accelerating handmade cigars. That is not only U.S., because when you look at it, about, well, 65% of the global consumption of handmade cigars is in the U.S., but there's still a big bucket outside of U.S. We see with the range and availability of our handmade cigars, we are in a very good position when it comes to inventories. Our growth rates at the moment, last year and this year already, are really high. Hope that answers your question. Okay. Thank you. There are no more questions from the live stream. I think also we are about the conclusion. From our part, I would say thank you very much for all the good questions you have addressed, both here in the room, but also on the live stream. We sincerely hope that you have got good insight into our company, what we are going for in our ambition to both growth the company, but also to continue to create value. Thank you very much for that. Before I will conclude completely, I will just mention that we will have kind of a social component for those of you being present here in London, which is of course. That is a social component where you have the opportunity to talk with the EB members in a more relaxed context. Also, most importantly, we have Sean Williams, our brand ambassador for the Cohiba brand. He will be there for you. Any questions about the craftsmanship of a cigar, there will be a possibility to have a talk with Sean. There will be a possibility to understand kind of the products. As I understand, Sean, you have had your own brands that you have developed over the times. A true connoisseur in this field. Due to smoking restrictions, of course, that will be on the terrace just outside the room here to the left. There's a terrace where you can have all the enjoyment of our products. With that, thank you very much for being here. Thank you for participating, and that's it. Thank you.