Ladies and gentlemen, welcome to Kesko's full year 2021 release call. I'm Kesko's CEO, Mikko Helander. I have together with me our business area presidents, Jorma Rauhala, Ari Akseli, Matti Virtanen, as well as, our CFO, Jukka Erlund, and IR, Hanna Jaakkola. Today's agenda is, the following. I will first give an overview of our business performance in 2021 and Q4. Thereafter, I will go through our guidance for 2022. After the presentation, we will be happy to take questions both by phone and via chat. EUR 776 million, the best result in Kesko's history. Our annual result has improved for 7 years in a row, and our quarterly result has also been a record for 11 quarters in a row. The record result is strong proof that our growth strategy is working and being successfully executed. Key events in 2021. As said, this is the best result in Kesko's history. We were able to significantly increase our profit in comparable terms by nearly EUR 208 million. Our net sales grew by 8.2%. In Grocery Trade, both retail sales and profit were record. Strong sales growth and all-time best profit also in Building and Technical Trade. In Car Trade, the division is going through a strong transformation, and as a result, we saw a significant profit improvement. Net sales growth continued in 2021. The net sales totaled EUR 11.3 billion. It was up comparably by 8.2% thanks to our strong strategy execution. Net sales increased in all our three divisions. Comparable operating profit for 2021 was record high EUR 776 million and profitability 6.9%. It increased due to good net sales growth and sales margin development, as well as improved cost efficiency. Comparable operating profit increased in all our three divisions. Return on capital employed, one of our strategic targets, continued to improve and was at the level of 17.2%. It improved in all our divisions. Kesko's financial position is strong. Cash flow from operating activities was close to EUR 1.2 billion. Capital expenditure totaled EUR 277 million. Another of our financial targets, net debt to EBITDA was zero, well below the target level. We continued the investments in sales growth and better operational efficiency. In accordance with our growth strategy, we bought Byggarnas Partner in Stockholm area. In December, we announced the acquisition of Kungälvs Trä in the Gothenburg region. The acquisition is expected to be completed in the first quarter this year. All-time best Q4. First, some Q4 key figures. Net sales and operating profit continued to strengthen, resulting in an operating margin of 7.2%. EPS was 0.40 EUR. Net sales in Q4 2021 totaled nearly EUR 2.9 billion. It was up comparable by 7.2%. The growth was especially strong in Building and Technical Trade. Comparable operating profit for Q4 was a record high EUR 204 million, and it increased by nearly EUR 38 million. The profitability was 7.1%. It increased due to good sales development in Grocery Trade and Building and Technical Trade and improved cost efficiency in all divisions. Good development continued in Grocery Trade. Net sales totaled EUR 1,557 million and grew comparably by 2.6%. Net sales grew in K-Citymarket, Non-Food, and Kespro. Comparable operating profit for Q4 was record high EUR 131 million, and it increased by EUR 8 million. Profitability was 8.4%. Profitability improved especially thanks to growth in Kespro's food service business and K-Citymarket's Non-Food sales. During the quarter, retail sales market grew by 1%, and retail price growth was 2.1%. Food service market growth was 16%. Restrictions on restaurants in Finland impacted the food service business towards the end of the quarter. Our result was record. K Group Grocery Trade retail sales were up by 0.1%, and Kespro sales were up by 20%. K-Citymarket non-food sales grew by 4%. Online grocery sales grew by 14% in 2021, but decreased in Q4 due to very strong comparison figures. Profit growth continued strong for Building and Technical Trade. Net sales grew comparably by 18.5% to EUR 1.1 billion. Net sales grew in comparable terms in all operating countries. Growth in B2B trade continued strong in all operating countries. In addition, growth has been supported by strong volume development in the construction market and continued rise in material prices. Comparable operating profit grew nearly by EUR 30 million- EUR 74 million. The profitability improved and was high 6.7%. Comparable operating profit grew in both building and home improvement trade and Onninen's technical trade in all operating countries. The changes that we have carried out in recent years have had a significant positive impact on the division's profitability. Also, the acquisitions and their successful integration have supported profitability. In addition, the market development has been strong. During the quarter, construction renovation market was growing in Northern Europe. Growth focused on B2B trade. Demand in B2C trade has come down from last year's peak levels. Product prices continued to increase, and there were availability issues in some product categories. Our result was record sales and profitability improved in all operating countries and units. In Finland, both Onninen's and K-Rauta sales grew clearly, also profit improved further. In Norway, development in Onninen was particularly strong and profit improved also for Byggmakker. In Sweden, good development continued. In sports trade, both market share and profitability continued to grow. In Car Trade, transformation is proceeding and bringing results. Net sales for Q4 totaled EUR 219 million. It declined comparably by 6.3% due to availability issues regarding new cars. Comparable operating profit for the Car Trade division grew by EUR 2.4 million. Profit improved thanks to higher sales margins and cost adjustment measures. In Q4, demand for new and used cars as well as servicing decreased. First registrations of new cars were down by 15.5% due to component shortages. In Q4, 40% of new car registrations were EVs and plug-in hybrids. Our profit improved thanks to sales margin growth and cost savings. New car sales were down due to availability issues. Share of EV cars and plug-in hybrids was 47% of our sales. Market share of K Group brand was 14.7% in Q4. Transformation of our operations is proceeding well and all businesses are profitable. Outlook for 2022 is good. Guidance for 2022. Kesko estimates that its comparable operating profit in 2022 will be in the range of EUR 680 million-EUR 800 million. In 2021, Kesko's comparable operating profit totaled EUR 776 million. We continue the execution of our growth strategy. Our strategy provides a good foundation to continue on the growth path to increase sales and improve profit even further. Profitability in food trade is on solid basis. We have the most extensive network of grocery stores across Finland combined with effective online sales. Our strengths include also the K retailer model and store-specific business ideas that are built by using data to ensure the best customer experience. There are still plenty of potential in implementing store-specific business ideas further. We will also continue investments in updating the stores. Kespro is a strong market leader in growing food service wholesale. There are significant synergies with our grocery stores. Once the pandemic eases, demand for services is expected to grow, and food sales are expected to partly shift from B2C trade to food service wholesale. Also, food price inflation is expected to support sales growth. We aim to continue strengthening our market leading position in online grocery. Online grocery has grown by almost 450% in two years. K is the biggest online grocery operator in Finland with over 500 K grocery stores in online network. We offer very competitive prices. We have our own brands, and our purchase volumes are large to ensure competitive prices. Customers value Plussa customer loyalty program with both general and customer-specific Plussa offers. Plussa money and affordable deliveries. Store-specific business ideas are visible also online with local products and service products. Our selections is the biggest on the market with as much as 40,000 products. There are different delivery options: home delivery, Click and Collect, fast delivery. Last year, we delivered some 2 million orders. Customer experience is excellent with NPS of 81. Feedback emphasizes wide selections and high quality. We are constantly developing our capabilities. The first automated in-store collection system in Finland will start operating first half of this year. Good growth. Good outlook for Building and Technical Trade is. Sorry. Growth outlook for Building and Technical Trade is good. Growth is supported by our focus on the growing B2B trade complemented by good B2C trade. There are still further potential to improve operations and customer experiences by developing sales processes by increasing the level of digitalization and improving the efficiency of internal operations. Our aim is to accelerate growth with acquisitions also going forward. Green transition, changes in population structure and urbanization will continue to support construction growth. Once the pandemic eases, demand in B2C trade is expected to normalize while demand in B2B, which now accounts for 75% of the division sales, is expected to remain good. Price inflation is expected to support growth, but prolonged price inflation would lead to lower construction volumes. Also, for Car Trade, 2020 and 2021 results were record. The transformation of Car Trade division is growing sales and improving profitability. Our focus on selling new cars, used cars, and services offer significant growth potential. Good collaboration with the Volkswagen Group and Volkswagen Group's strong product offering supports our success. We are putting efforts to improve competitiveness through better customer experience, digitalization of operations, and better efficiency of internal processes. Demand is expected to be boosted by the need to reduce traffic emissions and update the Finnish vehicle stock. Delivery issues related to the availability of semiconductors will continue to hinder business also in 2022. Dividend proposal. Kesko's good ability to produce profits and the strong financial position enable a good dividend capability. Kesko's board of directors proposes a EUR 1.06 dividend to the annual general meeting. It is over EUR 420 million in total. The proposed dividend is proposed to be paid in four installments in 2022 in April, June, September, and December. The payout ratio is 74%, and it is in line with Kesko's dividend policy. Thank you so much, Mikko, for the presentation. Now we are ready for questions. Let's first take questions from the conference call lines. Please, operator, we are ready. Thank you. We will now begin the question and answer session via the telephone lines. If you have a question for our speakers, please press 0 and 1 on your telephone keypad now. Please hold until we have the first question. As a reminder, to ask a question, you have to press 0 and 1. We've received the first question. It is from Niklas Ekman, Handelsbanken. Your line is open. Please go ahead. Yes. Good morning. Thank you. It was a bit difficult to hear you for the first 14 minutes. There must have been something wrong with the phone line, so apologies if you have mentioned something on this topic. I'm keen to know what you're seeing in terms of pricing in your B&T segment. I understand that has been driving going up quite a lot over the past couple of quarters. What are you seeing now in terms of 2022? Do you expect H1 to still be very positively affected by pricing and then it sort of flattens out in H2, or what's your view on that, please? Yeah. Good question. We have seen already some price inflation in Building and Technical Trade, and we expect that this development continues also in 2022. It varies in different product categories, but it is obvious that based on increases in raw materials manufacturing costs are increasing. Due to that reason, as I said, we are expecting also clear price inflation in 2022. Jorma, would you like to add something? Totally agree with what you said. If you look at those construction forecast companies, what they are forecasting and they are saying the same. We also see the first quarter that prices have still increased. Of course, we are working very hard to transfer those higher costs to the sales prices. Yes. I think we managed very well on that, last year. Exactly. Okay. Yeah. Very good. Thank you. For the grocery division, what sort of volume demand year-on-year do you expect in 2022? Thinking about food retail specifically. Yeah. In wood retail, we expect also cost and price inflation volume-wise, especially if and when pandemic will end during this year. We are expecting volume-wise maybe slight decline, but at the same time, we should remember that there will be also volume shift from grocery to food service. When you remember that, we are clear market leader in food service, this development might be also positive for us when at the same time we are expecting also price inflation in grocery and food business. Ari, do you want to add something about that? I agree with you. This is the big picture that market will be by volume-wise flat, but good part for Kesko is that we are operating in the both market, in the food service and also in the grocery market. Yeah, exactly. Yeah. Yeah. Perfect. Thank you very much. We have another question. It is from Svante Krokfors, Nordea Markets. Please go ahead. Your line is open. Yes. Good morning, and thank you for the presentation. Couple of questions. First one is, how do you look at your relative position versus competitors in grocery if we assume that food inflation continues to rise and perhaps rises more than expected? All in all, we have gained heavily market share in last seven years, from competition and of course, due to that reason, this is main reason also why our profitability is today very good in grocery business. We are working hard to continue this development. Of course, more and more we are looking food trade as one complete entity because again, I remind you that we have very strong position in Finnish food service market. For us, most important is that all in all, our share in food trade is growing. In grocery already we have very strong position, and we are very pleased that we have succeeded to make Kesko also clear market leader in fast growing food online business. Food online, our grocery store network and food service is very strong combination, and we believe strongly that, based on this combination, we are in good position to continue growth also in future. Thank you for that. On the same theme, could you elaborate a bit on your suggested split from store sales to K-store sales to Kespro sales. Could you elaborate a bit on how that impacts your margins and on your full year guidance? Perhaps just the impact on your margins from that shift. Yes. My colleagues definitely they can do that. Before that, I would like to stress also that this strong combination of grocery stores online as well as leading position in food service make Kesko also quite a unique player in food business in Europe. That is definitely one of those main reasons why Kesko is so well-performing and so profitable also in food trade. Jukka, Ari, maybe Jukka you are the best guy to open a bit more those numbers. Yeah. In the big picture, I would say that the channel shifting away from grocery stores to Kespro doesn't really play a big role. Both of those channels are very profitable for us. In that sense, we don't expect very big sort of differences in results coming from that side. Thank you, Svante. Any further questions? Investments for this year and perhaps also split into stores and online investments and so on. Ot her question, Svante. Yes. Can you hear me? Now we can hear. Okay, great. Yes, on CapEx, could you elaborate on CapEx levels going forward and perhaps also the split between store investments and online investments and so on? Yeah. It is important part of our growth strategy that we invest heavily in the future and we continue big investments. Jukka, maybe you can open a bit more those numbers. Yes. We'll continue upgrading our stores and the stores still take the biggest proportion of our CapEx. We'll continue on that side, upgrading the stores, but we also continue investing to the digital capabilities and IT capabilities and so on, in order to offer a new kind of services for our customers and, like, you know, also new technologies on the online grocery picking side as well. We'll continue on those side, but not really a big change happening in the sort of proportion of those CapExes. According to our strategy, continue our CapEx. Plus, of course, acquisitions. Yeah … we are seeking continuously new targets to make also in future acquisitions and support our strong growth also based on acquisitions. Thank you. The final question's on the guidance, which is EBIT guidance 2022, which is understandably wide. Could you elaborate a bit on, I mean, issues that you cannot affect yourself, like the pandemic development and construction market? What needs to happen in the environment for you to either reach the low end or the high end? The pandemic, as you mentioned, of course, is still a big issue. Now, at the same time we should remember that, from Kesko's point of view, definitely we can say that we have managed very well also this pandemic situation. I believe that we will do also this year. Pandemic is a question mark. Of course, geopolitical situation is now, let's say, interesting, at least in Europe, and why not also worldwide. That could complicate the business environment and disturb also our businesses. Nobody knows. Now, inflation, we mentioned already. Inflation is now going up, and in longer term, especially in Building and Technical Trade, inflation might be negative. In short term, we believe that inflation in all our businesses is supporting also our growth. Especially geopolitical situation, pandemic, are definitely those biggest issues where we don't have so much impact. Thank you for very good answers. Perhaps a last question, which I guess you will not answer, but regarding Oda, which now has ramped up operations, do you have any observations or comments that you want to share? No, definitely we answer. We like competition and newcomers challenge us. It is great and very important to remember that in last two years we have succeeded to increase our grocery online business nearly 450%. That is very strong message that we are doing also excellent job in online business and we invest in online services. Customer satisfaction is sky high. NPS 81. Nearly two million deliveries last year. Outlook is very positive in online business. It is also important to remember that the foundation of our successful online business is also store network. We have excellent K stores nationwide, 1,200 K grocery stores, and we have succeeded to combine online services on those stores. That creates very, very strong and successful platform to succeed in online business also in the future. Of course, we invest also money on new technology and, Ari, maybe you can continue and open even more those details how we are developing also our online services. Yes. Like Mikko mentioned, we are clearly a market leader in online grocery business in Finland. We have many capabilities which are very strong when you are playing in that field. Like, for example, buying power, it's totally different than comparing to, for example, Oda. We have strong share of the private brands, and the price difference between private brands and A brands is at least 20%. At the same time, we have very good variation of different delivery models, fast deliveries, cooperation with Wolt, for example. Click and Collect. Click and Collect, and also customers have visited, you know, strongly supporting the model that they can pick up the o nline shopping from the stores, we have much wider assortments like a 40,000 SKUs in grocery comparing to the 5,000. Most customers actually are doing the online shopping because they like to save time. If you have very limited assortment, it actually means that you have to go still to the stores. We are very confident with the situation. Okay. Thank you very much for taking my questions and for the good answers. Thank you. We actually proved you wrong. We answered the last question as well. Well, we have a couple of questions here from the chat, but are there any more questions from the conference call lines? No. There are no further questions at this time. All right. I turn to the chat, and I have three questions here. First of all, Jutta Rahikainen, SEB, asking, "What level of food inflation do you expect?" Probably for this year. We already discussed that, but if you would like to comment. That is so difficult question that maybe I ask Ari to answer it. Thank you very much, Mikko, for that because it seems actually that in Finland, food inflation seems to be at the moment at a lower level than general European level. It's expected that it will grow during the year. A question we slightly touched on the geopolitical issues. Any updates on Senukai, please? Geopolitics probably does not help, is the question. No. Geopolitics is geopolitics, and I don't see any impact coming from geopolitics in Kesko Senukai and our Baltic businesses. All in all, we should remember that 2021 was also successful for Kesko in Baltics. First, Onninen businesses in Baltic countries developed very well as well as Kesko Senukai had good progress volume sales-wise as well as profit-wise. Also, the outlook for 2022 is positive in Baltic countries. Okay, between us, Rakauskas family, we have some issues, and we are working also on that side. One day I believe we will reach some kind of resolution. When? I don't know, but most important that the business itself is performing pretty well. Very good. Thank you. Then the last question. You still have time to post questions, use the chat function. There is a small delay before I get the question, so just use the opportunity. But Jutta asking, "Do I read your guidance framework correctly that it assumes that the pandemic to ease during 2022? Pandemic to ease. Yeah. At least we hope. But we can say that Jutta read pretty carefully our guidance. Very good. Well, I would like to thank all the active participants and our management here for the questions. Have a nice day. Exactly. Have a nice day. Thank you for your participation. Thanks. Bye-bye. Bye.