Welcome to Duell's First Half, 2024 Financial Report Webcast. The report will be presented by CEO Jarkko Ämmälä and CFO Riitta Niemelä. My name is Pellervo Hämäläinen from Investor Relations. Jarkko and Riitta are going through the presentation, and after that we have the questions and answers session. Questions can be sent through the chat during the webcast. Let's go, Jarkko and Riitta, stage is yours. Thank you, Pellervo, and good morning from my side also, everyone. Yes, like Pellervo said, we have a different fiscal year, so now this is already our Q2 and H1, even though we are early 2024. Here are a few reminders on what Duell is, what they do, and where we operate, size, and location. So we have headquarters in Finland, but we operate all around Europe. We are a market leader, Nordics, but also now in Europe getting bigger and bigger market shares. UK, Benelux, Germany, also France is the biggest market in our industry and where we take a stronger part. A few key figures here: today we have 8,500 active dealers around Europe, roughly half are still in the Nordics, but the rest of Europe is growing now month by month. We cover all sales channels, from online sales to smaller workshops. So the company today, roughly 200 employees, where mainly are Nordics because our biggest warehouses are still in the Nordics also. Okay, let's go to, h ere is just also the highlights where we operate. We cover every different, we call it powersports categories, but also the bicycle is an important part of the group now. But we cover from ATV to snowmobile, off-road, on-road, water sport, and also we cover all technical spare parts, but also the personal equipment, protectors, helmets, etc. So we cover everything else, but not the complete units. That's the kind of easiest to remember. Okay, let's go to look at what we did on the Q2 and H1. First Q2, it was a solid quarter for us. Even the market is still continuing to be difficult, hard to understand where the market is going and when the market starts to recover. But we did it pretty good on the net sales. We increased 10%. If you're looking for the comparable currencies, it's even more than 15%. Of course, the part that is growing is this TranAm, which is including now these quarters. And last year it wasn't yet there. It's coming then on the later last year. And we are growing mainly in the Europe market, where even there is off-season market timing. They are mainly a motorcycle market, but we get it in a good growing plan there, and that's where we can see the numbers now already. What is positive also: these net sales are organic net sales growing also. It's 4% compared with the current years. And especially Europe is the driver of that. And of course, when the turnover is good, it's also quickly positive on the EBITDA margin. So EBITDA is growing percent-wise. Even we have an issue a little bit on the gross-margin-wise. There are currency rates negative. And also, like everybody knows, the shipping costs now, the Red Sea issue, and those are growing. So that was a slightly negative impact on the gross-margin-wise. And we have a few one-offs on the inventory, what we open later on more. One big driver that's why EBITDA is now growing well is we really have good cost control. We fix the cost matching of the current market situation. And third, a really important point: what's happened this quarter is now we are now in a much stronger financial position. So like most of you know, we have a rights offering share issue, direct share issue, and also the rights offering. So the net debt is much, much lower now. But also a big part of those financial positions is that our net working capital management now brings a really good result compared to the current situation. For example, what was the situation a year ago? Okay, let's go forward. The main events, what's happened this quarter: of course, we paid the last part of the TranAm deal's purchase price. That's what we did at the end of December. Here is a lot that happened this period anyway. So then we have new shares rights issue that we closed in early January. That was really positive on the company financial situation. Same time or just before, we agreed on a new bank agreement with Nordea. That is now fitting better in this current situation on the market and the company. So we are extremely happy that that is done this period. Then a few important points: the people changes, positive things. Magnus started as the COO of the company on January 1st. Then the negative things, of course, like Riitta decided to change the new page of his life and leave the company at the end of April. That was the, I call it, only negative what's happened, these events, the big ones. The other one is positive. And also the early February Duell board decisions to do a new share-based incentive plan. A few key employees on the group started this program. So a lot happened in this quarter. Okay, now I give the word to Riitta to go a little bit inside those numbers, why they look like, how they look. Please go ahead. Thank you, Jarkko. So welcome to this webcast also on my behalf. Let's have a closer look on financial figures of our first half year of this financial year. So Duell, the revenue amounted to EUR 55.2 million in this first half year. The net sales growth was 7.5%, whereas the net sales growth with comparable currency was 11.6%. Organic net sales growth with comparable currency was -0.8%, so nearly zero. The sales growth derived from the TranAm acquisition, as TranAm is not included in the comparable figures. Meanwhile, in quarter two, the organic net sales with comparable currency was 4%. So we had, in quarter two, positive organic growth. There was a decrease in Nordics, where we had challenging markets, especially in Sweden. But there was an increase in the rest of Europe due to the increase in Duell's growth market, especially the increase in online dealers. Gross margin has improved slightly during the first half year, but there is a slight decrease in gross margin during quarter two. This was heavily impacted by the transport costs and also currency fluctuations. Duell has a profitability improvement project ongoing. Related to this, Duell has targeted to have increases in margin when going onward. Duell adjusted EBITDA was EUR 1.6 million, having an increase of EUR 1.1 million compared to the previous year. Duell has adjusted its operating costs to correspond to the current demand level. The fixed expenses level is on the same level as in the previous year, even though TranAm's fixed expenses are now included and were not included in the previous year. The differences between the adjusted and reported figures are explained by the items affecting comparability. During this financial year, the items affecting the comparability included EUR 2.8 million, and these were costs related to the rights issue fees. Then the capital expenditure decreased when we compared to the previous year. We still have the investment project on a new e-commerce platform ongoing, but with currently lower gear. Duell's net working capital was EUR 58.9 million, with a decrease of EUR 8 million when compared to the previous year. The comparable figure includes also TranAm. The same difference, the EUR 8 million, was in the end of last year and in the quarter of this financial year when compared to the previous year. This is a result from the fact that Duell has dropped significantly the general level of inventory, and net working capital is now having a normal fluctuation according to the seasons. Duell's net debt was EUR 30 million at the end of February, a decrease of EUR 33 million compared to the previous year. The decrease is due to the direct share issue that was in March 2023 in last year and due to the rights issue in January 2024. Also, naturally, the decrease in net working capital. The net debt includes the loans and revolving credit facilities from financial institutions and cash and bank. Operating free cash flow decreased by EUR 2.5 million in the first half year of this financial year. This is purely attributable to our new group company, TranAm, which is having seasonal fluctuations also. Let's have a look at our quarterly development. Yeah, just to remind, the quarter development is that our main quarter is now going on because in Europe, we are growing well in Europe, and Europe is operating mainly Q3 and Q4. So that's just a kind of reminder from you everyone that our quarter is normally a bigger quarter in the coming months. So they are also turnover-wise, but also EBITDA-wise. So that's why we just want to remind this one, that the quarter per quarter is not exactly the same. Yeah, this gives a good insight for Duell seasonal business. But it's also good to see when reading these bars that they are not fully comparable, as Duell has made several acquisitions during the last three years. And their figures, the acquired companies' figures, are included from the moment when the company was acquired. Okay, Jarkko, you can continue from here. Thank you. Okay, let's go forward. Where are first our focus areas? There's nothing changed. Our main focus has been in 2024 to improve the profitability program. That means, of course, the gross-margin side, but also the cost base. So that's where we continue in this market situation. So that's the key and most important area where we focus. The second one focus area is optimized net working capital. Like you see the numbers and you know historically, that is a quite big swing of the season inside of the winter when we prepare for the taking of the summer production. And those elements are a driver. But overall, we have already been really successful in working with lower net working capital, and we continue that process. Then the numbers outlook, we don't change anything. This is the same financial outlook like a few months ago. So because the market is pretty difficult to see exactly where it is, and there are a lot of question marks on the top-level financial side or the customers' buying power and so on. So we didn't give any outlook of the net sales in 2024. But part of those all programs, what we have, what is going on, we are confident that our EBITDA level is better than last year's. So we don't change this outlook. Here is just a reminder also of our vision, mission, and strategy. Maybe the strategy point we have is three key cornerstones in strategy. They highlight still the same geographical market expansion. It means also that some new categories on the new market. It does not mean only entering completely new countries. But that's the one important element. The second one, being the partner on the online sales, our online customers or the customers who are selling online or hybrid customers, being a good partner. So that means that we have a wide portfolio. We are stocking well and a lot of things inside that, what this means. And the third one, of course, the brand portfolio development. It's ongoing. It never stops. It's also the one part of that is the own brands part, own house brands, private label products, but also that we really have the best brands on the market to offer to our customers. So that's the key element in our strategy, and there's no change there. Okay, and yeah, that's a good bridge to here. At the end of the day, it's clear that we have a strong position on this value chain from brand owners, manufacturers, to dealers who sell out to the end users. If they sell out online or they're selling in the stores or they've been in the workshops, one-man workshops to a big retail chain, we have a strong value chain. Our business is between there to do our part of the work. That's pretty clear. Okay, that's it. And Pellervo, now let's start the questions, I guess. Yeah, thank you. So we are now ready to go through the questions that you have sent. The first question is related to the growth, especially in Europe. So could you describe from which countries or markets and categories the growth is coming? Yeah. It's coming from Central Europe. The biggest part of Europe is growing, coming like Germany. We've been a very successful, with the biggest motorcycle market in all Europe. We entered Germany two, three years ago, month by month, getting more customers, customer base, also strong online customers. So that's who can bring the quick growth. Also, there are really big online customers who see our value in this business. So I would say the one Central Europe, but Germany, if I need to put one country at the top of the list where it's the best growing in this period, was Germany. Then what about TranAm? TranAm, of course, they have the high season, mainly in summer. But how did the Q2 look like? TranAm is a solid business, been a long time on the market, extremely respect for the dealers and the brand owners. So they are doing solidly, like well what they do, really profitable. That helps for us more on the profitability side compared with the turnover-wise. The U.K. market overall is a slightly difficult situation in general. But I would say TranAm is doing a great job there. But it's not the big growing that is not coming there if you talk about the organic growth. Okay, very good. Then about the inventory valuation. So how material was that and what did it include? Inventory, you mean our, y eah, our inventory. The valuation adjustment that we mentioned. Okay. Yeah, yeah, yeah, exactly. Yeah, this is, y eah, maybe Riitta can answer. But of course, there is some close-out winter products, maybe clothing side, what we need to something maybe write down and these kinds of things, seasonality, short terms. We run a clear process quarter by quarter. So that's the one impact in there. Good. Then as we all have witnessed the strike here in Finland, so how do we see this as to be impacted on our business? So it's mainly for the coming months and the current month. Yes, we are lucky now that, first of all, it's really sad that Finland is in this situation overall. It shouldn't be in this situation if you're looking for Finland, where we are in the country financial situation or so on. The impact for us is not so heavy. Of course, it's an impact on something, but mainly this coming season, we already have a lot of products taken in before the strike. And then a lot of main deliveries from suppliers or the factories are coming at the moment from other warehouses than Finland. So Sweden is the biggest where we take in the products now because they are mainly summer products. And we use this Swedish warehouse also, the European and North European customers. So it's not really a big impact now in the... Of course, like we all know that we don't know how long this will continue, like this strike. It can be continuing for a few weeks in the worst case. Sure, the containers are somewhere. They did not arrive in Finland, but they should arrive. And then at least it brings the extra cost. It's not only, t he big problem is not right now that, yeah, we miss the products completely or we have very critical products. Some are delayed, but it brings the extra cost afterwards. I would say the bigger impact is the Red Sea issue, which started at the end of December, the container price going double very quickly. A few weeks, they doubled at the end of December to mid-January already. Now they start coming down, but this negative hit, we already took it on some part of the Q2 because that was the peak of the transport cost in mid-January to mid-February. And now the price started coming down again, normal. So all in all, not a big impact on the Finnish strike, but something sure. Okay, good. Despite that, we foresee that the market will remain still pretty soft, but there was some positive development mainly in Europe. So how do we see this continuing? Is the market anyway having some positive signs, or how do you see it? Yeah, there's a little bit of a positive sign, but I would say that in the last years, it's a pretty similar situation in Europe than the Nordics. But in Europe, we can win the market shares much more than the Nordics. So that's why we have a more positive situation in Europe. Even the market is pretty similar. The dealers are still scared to take a big inventory in the house. They continue now to want to work on the lower inventory levels all the time. In the long run, that is positive also for our business models. So because then they need somebody who really daily can supply more products when they sell out. Of course, I would say the biggest trigger is the interest rates when they start hopefully coming down. Everybody expects that in the summertime. So that's maybe, I would say, the positive trigger then. Things can change quickly also then that maybe demand is growing. But our own estimate and the planning, we believe it will continue quite soft. But mainly, it's really difficult to see how and when there can be improvements. But all in all, we believe that the bottom is already seen. So now it's just a matter of time when the total market starts growing. There are already some positive numbers, positive databases, but also positive feedback on the traffic, on the shops, and those when the sun is going up. Then there's already, especially in Europe, is already now the season really started, the motorcycle season. In the Nordics, we are still in the situation that the season change is not really turned on the summer season yet. So we are a slightly different situation, country by country, but all in all, it's pretty similar. It's just a matter of timing a little bit. Yeah, related to this one, so let's talk a few words about our customers, so the dealers. So as you mentioned, that probably we have seen already the bottom, but do we see that the dealers are still destocking, lowering their inventories? And are there differences, let's say, between Europe and the Nordics? Yeah, not so much, to be honest, like main Europe and Nordics. They have already done that. Everybody dropped their inventory a year ago quite a lot. There's not so much room to drop the inventory anymore. So now they need to buy if they want to sell. Then the question is, which dealer decides to cut off the portfolio or something like that? I would say the U.K. is a little bit later, the same issue. The U.K. is now more on the fact that the dealers are still overstocking quite heavily. In Europe, it's not so much an impact anymore. It's already kind of done now in the last 12 months-16 months. Of course, there is here and there still overstocking. It's kind of when you have bigger dealers, you have maybe more room to lower inventory. But if you are, like we have a lot of the, let's say, small or medium-sized dealers also, there isn't an issue at that moment anymore. Thanks. Then about the net working capital levels. So are we happy with the current net working capital level today? And is it kind of sustainable now or what? And And how low could we go, let's say, in the end of Q4? There is also the seasonality between these quarters. So how do you comment on that? If I take it first, maybe Riitta can come into detail. Then, sure, we have always those we call a swing. In the winter, we are going higher because we buy from the factories and then we sell out the stock and start to sell out. But you need to look in the long run. How is the swing still there? Let's put it this way. The level is lower than the previous year. So we are pretty happy with what we've done, but we are confident that we still have room to improve that. We are working on that a lot. We are going to improve that also in the end of the summer. Of course, we are much lower than now, but we are also lower than, I would say, historically. So then is, of course, the other side is the market dynamic changes a little bit. The dealers want to buy one by one every day. So you need to kind of stock also try to stock until the end of the season. So it's kind of optimized also that reason to keep stocking is more important for us than maybe some other historical years when the dealers didn't need it anymore. They have it in stock already. And also the own brand portfolio, what we do now and growing these own private label house brands, we are really kind of manufacturing the products. And then there are also minimum quantities and those things because our strategy is to increase those own brands and private label products. So it's kind of a combination of all those. But sure, it is, let's say, one of the main focuses, the net working capital coming down. We are happy where we are right now and the plan for the next six months. Okay. In addition to net working capital, the profitability is one of our focus areas. So we have gone through this profitability improvement program. Do we see that we are, let's say, from a cost-based perspective at a stable level? Or do we see that it could even kind of increase in the second half? Yeah, we are happy where we are now, the cost-based one. It is a main part of this strategy also, this season, and already started a year ago because we see the market is soft. That's how it is. It's important to control the cost base more than just looking for the growth, whatever it takes kind of. So sure, we need to improve many sectors. We need to also maybe hire more people somewhere, but somewhere we can save somewhere. It's not a big difference if you look at the short term, like H2 compared to H1, like cost-based. Then the profitability program, which is extremely important, gross margin also including there and a lot of things. We are pretty happy where we are now. But this is kind of, i t's not like one program that is top. It's also the process for the future because this is a lot of detail and a lot of different tasks. But this is extremely important for us to get a better profit on those because now we can't, t he top line is not, let's say, the main focus. It's more focused on the profitability, net working capital now. Very good. Then we have still one question. It's a bit, let's say, forward-looking question. So as we had the focus in Q2 mainly in the winter season, so how does the, let's say, the coming spring and summer season look like? Of course, we have noticed also that the dealers have somehow changed their behavior. The pre-orders have been smaller. But how do you see the high season coming now in the summer? Yeah, in the winter season, like the Nordics, we are pretty quite happy with how it is going, where we end up. We all know that the snow situation was quite okay, but then the other financial demand is not so great. But the weather was on the positive side. Now, in the coming spring, yes, we have a good order book in this current situation. Like we already talked about the dealers' change. They want to work on lower pre-orders and those more on the seasonal orders, what they needed. But then if we put all those together, we are happy with the current order book that we have it. So we are slightly positive about coming in the spring. Now is the most important month. From here to May is clearly the most important for us. Then we see quite well where we end up. There are many databases. It matters which dealers, how many dealers we have, new dealers, what product lines they agree to buy from us. So those kind of all together data is where we can estimate what we are going to do. We are pretty happy. We are a little bit on the positive side. Also more important maybe even is that our network dealers' level is now slightly more positive than, for example, like one month ago. Of course, the end user. The good point is end users still want to do it. They want to ride a motorcycle. They want to ride a snowmobile in the winter. That's not gone anywhere. It's just, of course, the top line financial brings the matter of the demand. Of course, like we talked about those dealers' inventory levels and those things all together. But we are slightly positive about how we see now this Q3 and Q4. Very good. We have gone through all the questions and would like to thank you for your participation. Also Riitta for her career at Duell. Moving forward to the next steps. Thank you very much. We will have Q3 coming out in early July. Riitta, if you want to have some greetings, feel free. No, I was just thanking you. Thank you, everyone. I have worked with this for five years. It's been an amazing road. Amazing trip. Thank you. Thank you. See you again. Thank you. See you again.