Good morning, and welcome to Tokmanni's first quarter result presentation. My name is Mika Rautiainen, and together with Tokmanni CFO, Mr. Markku Pirskanen, we're gonna present the key points and the key results of the first quarter. After that, there is time for questions and discussion. As we say over here, the weaker purchasing power slowed Tokmanni's sales growth down during the first quarter. Tokmanni's target for the first quarter and for this year has been to continue with the sales growth, but we didn't succeed with that. Revenue grew only by 0.6%, and actually like-for-like revenue decreased by 2.7%. Last year during the first quarter, it was very strong growth figures, but I have to say that the main reason for lower sales figures is basically several shocks for Tokmanni customers during the first quarter. First of all, the inflation already started in the end of last year. Higher energy prices, higher fuel growing, whereas non-grocery product groups sales were declining during the first quarter. This is the main reason for the lower gross margin level of 32.4% compared to previous year's 33.1%. In groceries the gross margin is clearly lower compared to non-groceries. No sales growth, lower gross margin and rising operating expenses ended up with clearly lower result. -EUR 500,000 compared to last year's well record high EUR 6.8 million. This was obviously a disappointment for us. The cash flow from the operating activities amounted to, or it was - EUR 65 million. The inventory level is the main reason for this, and basically the high inventory level. Basically the biggest reason is the problems actually from last year in the supply chain when it comes to the factories, production capacity and the shipping arrangements. That's why we've been forced to basically order and bring all the spring, summer season goods to Finland tow to four months earlier than ever before. We have like a basically full. All the warehouses are very full at the moment. On the other hand, we're ready for the spring season, but still, this is a very difficult situation for us. Luckily the situation will ease up during this year. Earnings per share was -EUR 0.04. Some of the key points during the first quarter. Like-for-like customer visits in stores down by 4.1%, which is like a little bit strange situation for Tokmanni is we're quite used to growing figures with customer visits. As mentioned, the shocks were from, according to our analysis, quite strong for our customers. This is what our customers also say when we are doing customer surveys. The like-for-like average basket grew by 1.5%. The average basket is on a good level since the previous year's growth was 4.3%. As mentioned, sales of groceries basically all product groups grew clearly. The non-groceries actually all the product groups were declining. The sales were declining. Tokmanni online sales increased almost 30%. It is very good, but as for Tokmanni online, the first quarter is basically the smallest quarter of Tokmanni business. Online share of the total sales was during the first quarter only 1.7%, but it's growing, which is very good. The inventory increased due to securing flow of goods, expansion of the assortment and higher purchasing prices. Obviously, the higher purchasing prices have actually quite strong effect on the inventory level or, yeah, the value of inventory. Also the main reason for this is that we just had to make sure that we well, basically we ordered everything, all the spring summer products already 12 months ago. We also got the goods to Finland much earlier than ever before. Now according to basically our office, for example in Shanghai, there is a lot of production capacity available due to less demand in the global market. So, for example, for next year season, we are able to move towards normal supply chain rhythm, which means that, you know, like, we're able to basically go back to the previous standard with ordering timings and so on. This will obviously make our inventory level much healthier in future. The construction of the new warehouse right here, very close to us, at the moment, that has started as planned, which is very good. Miny Lifestyle Brand was also launched successfully in the end of February. Tokmanni Klubi, our customer loyalty program, has already 1.1 million customers. This is very good and very promising development for Tokmanni. Couple of things regarding the retail environment for Tokmanni in Finland. First of all, the consumer confidence is remarkably down during the beginning of the year, and it looks as if it will continue like this as well. The purchasing power has weakened due to the rising inflation. Obviously, there is uncertainty in our customers' minds regarding the future. Customers are cautious with their shopping behavior and so on, and we have to take this into consideration. The buying prices and domestic transportation costs, basically all operating expenses, have risen significantly. On the other hand, the employment rate in Finland is at a high level, which is very good. The spring season, we are better prepared to the spring season than ever before because basically we have all the spring and summer season seasonal products already in Finland. Almost already in our stores, basically. We're ready to start. Unfortunately, weather-wise, the start this year will be, or it is, two to three weeks delayed. We believe that low prices and discount retailers will be having a more and more important role for consumers in Finland during this year due to all these reasons mentioned regarding consumer confidence and buying power. These are the times when the discounters usually manage pretty well. We believe in that as well. As mentioned already in the end of last year, there will be a fight for the market shares in Finland, and here's the figure regarding Tokmanni's and Tokmanni's competitors' market development. As you can see, from the beginning of the pandemic, first quarter 2020, Tokmanni has been winning market share, well, quite a lot. The competition really started last year and, well, I'm pretty sure it will also continue from here. Luckily enough, during the first quarter, we have been winning market share again, which is extremely important, and actually our target as well. Here were the key points, and then we go to the key figures. Markku, please go ahead. Okay, thank you, Mika. Let's go through the figures a little bit more deeper and starting with familiar graphs, basically. I have taken four years development here so that it is a little bit better to analyze a longer term here because we have had this Corona time and going over this Corona time perhaps tells us a little bit better how the business has developed. Here, as said, you see the four years development. Starting about the revenue, as already mentioned, revenue grew only 0.6% as a total. The good thing it was that we gained a market share during Q1 2022. When we look for like-for-like revenue, it decreased 2.7%, but at the same time, we have to remember that last year we have a very good growth, 12.7% when we are looking at like-for-like revenue. Interesting thing is that when we are looking at our sales mix, we were selling more groceries clearly, whereas the sales of non-groceries declined. I think so that this is clearly telling us about the consumer's purchasing power and the decreasing consumer confidence. People are basically buying more the products what they are needing daily and perhaps leaving for the future the non-grocery products. About the comparable gross profit and then the gross margin, which is of course very important for us. We reached to 32.4% during Q1 now compared to last year's 33.1%. Why it is declining? There are mainly or basically two main reasons. The product mix, which I already mentioned, we were selling more groceries, and as everyone knows, they have a lower margin compared to the non-grocery products. The other thing is, of course, that we are aiming to keep our low price image clearly, and we are normally the last ones which are increasing our prices. When we are looking at this four years development here, we are seeing this, that this 32.4% was even higher compared to 2019 and 2020. At the same time, I have to say that, and as we have already communicated earlier, that according to the strategy, we are clearly targeting to improve our gross margin. That was not according to our target. The other thing which is affecting to our margin level is how much we are selling product labels managed by Tokmanni, meaning the private labels and also the direct import. Due to this product mix, we are seeing here that our private labels were decreasing down to 28.4%, compared last year's 29.6%. As said, the main reason for that is the product mix, because in certain product areas, we have a higher share of private labels. Now when we sold more grocery stuff, the share of private labels in these product groups are on lower level. The direct import, I have already earlier also said that they are in relation to how much we are selling private labels because we are able to better control from where we are purchasing and how we are purchasing when we are purchasing private labels compared to the brand products. The direct import also decreased compared to last year level. Jumping next to operating expenses and as a whole, the ratio was 25.2% compared to last year's 23.2%. There are a couple clear reasons behind that one. Of course, when we are taking the personal expenses, which is the biggest part of our OpEx, the personal expenses ratio increased up to 14.5% against last year's 13.6%. Reason behind that was that our personal expenses were on higher level due to the volume of sick leaves, and then that was due to the coronavirus pandemic. The other thing which increased our euro-wise expenses is the expansion of a store network. When we are looking for how many stores we have at the end of Q1, we have 197, and last year we had at the same time 192 stores. It is clear that it will bring more euro-wise expenses. At the same time, I have to of course say that when we are increasing our store network, we should get more revenue. At the relative expense ratio should be at least on the same level or even better. Now we didn't succeed on that. The third thing which affected the operating expenses was the cost inflation. Almost all cost items were increasing euro-wise. One example has been taken here. Property expenses are big cost item for us and especially high energy prices and also the general cost inflation affected our property expenses. Comparable EBIT, it's natural end result from gross margin and operating expenses and of course the revenue level and ending up during Q1 2022, EUR -0.5 million compared to last year's EUR 6.8 million. We were clearly behind on last year's figure. At the same time, I have to say that Q1, which is from seasonal point of view, the lowest quarter for us, it's very much depending on revenue level. In the low revenue, it's clear that when you have a bit lower margin and higher expenses, it come through very strongly. Balance sheet, financing and cash flow, we ended up, when we are speaking about our inventory, to the figure EUR 305 million, roughly, compared to last year's EUR 250 million. It's on high level. There are three different reasons behind that. We took products earlier into our inventory to be sure that our shelf availability is on high level. Other thing is that we have clearly expanded our assortment. I'd like to remind also that when we speak about the inflation and the higher purchasing prices, it clearly affects our euro-wise inventory. As Mika already mentioned, it seems that the need for earlier purchases will not go away, but will be on lower level during the year. We should be able to improve our inventory level and inventory turnover ratios during the coming quarters. Due to higher inventory level, the cash flow was EUR -65 million, clearly lower compared to last year's EUR -22 million. At the same time, of course, I like to remind you again about the seasonality, that the cash flow normally is on the lowest level during Q1. Looking at the interest-bearing debt, the total EUR 419 million, compared to last year's EUR 393 million, so a bit higher level. At the same time, looking at what are so-called real debts, we had EUR 125 million on that item. Other debts are these lease liabilities which are coming due to IFRS 16, which we are reporting or using as a standard when we are reporting. The ratio of net debt to comparable EBITDA was still on quite good level, 2.4, when we are looking what is our target in our strategy, which is 3.2. We were clearly on lower level when we are looking that figure. About the net capital expenditure, basically speaking about investments, construction investment, our new warehouse and the amount EUR 7.4 million is coming from that investment. Basically this EUR 3.4 million. We're looking the total investments, 2022, we are estimating them to be EUR 18-20 million, excluding the construction of a new warehouse building. That's about the key figures, and now I am handing over to Mika. Thank you. Thank you, Mika Rautiainen, for your informative recap. About the year kind of figures, we have a very clear focus for the rest of the year. First of all, as we already mentioned, in this kind of situation, the role of the discounters, the role of low prices will be same issue. Basically, we will focus on sales growth. Even in this situation, we will focus on the sales growth. It's gonna be the best assortment and the low prices. Also the Tokmanni, very good chance of improving our sales growth with Tokmanni Klubi. When it comes to the gross margin, obviously, we're happy about the sales growth. Short-term action points, we'll obviously take to improve Tokmanni's profitability. Basically, in our strategy, we were talking about the large scale stores and see what's happening in the construction market. We'll focus on the profitability, short-term profitability issues. As already mentioned several times, also, we expect the revenue to be at the previous year's level. Obviously, the target is still to grow the business, but I have to say that the shocks for our customers were in euros expected to be from EUR 90 million-EUR 110 million in 2022. Obviously, there are all these elements of uncertainty, but at the Thank you, ladies and gentlemen. As a reminder, if you wish to ask a question by phone, please press zero one on your telephone keypad. We already have one question coming from Nicklas Skogman from Handelsbanken. Please go ahead. Yes. Hi, good morning. Thank you for taking my questions. Hi. Hi, Nicklas. If we start with the new guidance, if I look at the midpoint, which is EUR 100 million, and then given the result in Q1, it would require you to deliver the same or actually slightly better earnings for the remainder of the year as compared to what you did last year. Thinking about that, with the background of your comments on consumer purchasing power, higher input costs, cost inflation. With that in mind, I'm keen to hear your thinking around the new earnings guidance and how you arrived there. Well, Markku, please, you can also join this, but I would say that, obviously from last year, there are some weaker points and soft results in, well, some areas where we can see, we can clearly see that there is room for improvement. For example, if you look at the quarters from last year, we were not successful, not that successful with fourth quarter results. Also during the third quarter, it wasn't that successful. We know exactly, like, where we have room to improve our operations from last year. However, we definitely need to take this consumer behavior into consideration. I would say that the way we analyze the situation in Finland is that the pandemic will start going down, the effects of the pandemic, at least for the spring, summer season. Obviously, nobody knows what's gonna happen during the coming fall, but still, we feel that, you know, the pandemic is not such a big issue. The pandemic still cost us losses in customer visits. Another issue is this, let's say, you can probably understand what I mean when I say that there is an anxiety with Finnish consumers regarding the war. Excuse me. That will probably go down a little bit as well because it cannot continue that long. Obviously, we don't know what's gonna happen with the war, but still, the first shock was pretty strong. Now we can see that it's kind of going down a bit. Obviously, one of the biggest issues is the inflation. There we feel that we haven't seen the highest inflation rate yet, and that will probably cause some problems. There we feel that a discounter definitely can be on a very strong position. Markku would you like to add anything or what, Nicklas Skogman, was it an answer to your question? Yeah, no, I kinda see how you're reasoning there, but it also means it's pretty dependent on Q3 and Q4 that you're doing better sort of operationally this year compared to last, it seems. Can I ask then, given that you haven't even mentioned the shift in Easter to Q2 mostly this year, I was wondering if you would share with us how you are sort of performing year to date, sales-wise, given that Easter tends to have a positive effect on sales. Well, for Tokmanni, it's obviously the timing of Easter has a well big role, but it's even more, it's the start of the spring season. It's the best possible combination we could have is the start of the spring season and Easter together. Unfortunately, it didn't happen this year. We're delayed two to three weeks from last year when it comes to the start of the pre-spring season. I don't know weather-wise how situation is in Stockholm, but over here in Finland, it was this morning, it's still the southern part of Finland, and it was - 2 degrees Celsius. We still obviously the snow is melting away, but still, it's not really the start of the season yet. It's a very crucial point, the start of the spring season. It will always come. It will come a little bit later or earlier. The best possible combination is when it joins Easter, but this year it didn't happen. We're quite confident on that. Last year, we still had some issues regarding the supply chain and seasonal products coming in. This year, we're all set. It's only some sunshine and warmer weather. Okay. Good. On the high inventory level, and if you combine that with maybe a bit softer demand, do you see a risk of markdowns later on this year? No, we are not expecting actually, markdowns. We have everything set for a very good spring, summer season. When it comes to the inventory level, it's really a strange situation that we could actually see already confident we do everything to have a very successful spring season. I don't know, we don't really see. Let's say the inventory level is. When we are on a high level of inventory, if it would happen so that we were not or will not be successful on our sales. That's of course always a risk, for that markup, what you asked. Yes, we have to sell these products next year. Okay. We believe in the spring season. My last question would be on you mentioned the different product mix with more grocery. That's the situation, meaning that the higher the priced products we're not selling, if I understood right your question. Yeah. I was wondering if, you know, the slightly more high- Winter products. Obviously, we could see the cautiousness of our customers like, "Okay, we're in a situation of a high inflation, and a little bit due to the fact that developing back to a normal level. Actually not that much of effect. We could clearly see with the customer visits that now people- Just to clarify that, on your guidance. Sorry, the next question is on the guidance, because you imply a negative like-for-like growth for the full year if you look at flat total revenue growth. Then if you try to fix, then you should have a growth. Just trying to think a bit out loud here, how you think about that. No problem, Nicklas Skogman. We're actually also trying to figure out, like, how it's gonna be, because obviously it's been like a little bit behind also. Hopefully, like I said, the spring summertime will ease up a little bit the inflation situation. It's extremely difficult to. We don't know exactly like what will be the final inflation rate in Finland. As you know, probably compared to Europe, we're a little bit low, on a lower level. It's a little bit like. We are of course seeing this inflation figure, which is leading to the direction of higher basket size. We have basically two drivers which is affecting. Of course, the third drivers are our own actions to try to get the higher basket size. Basically three different items. That's why it's a bit difficult to say exactly how it is going to happen. Okay. Just to sum up then, if you break down the like-for-like that you sort of implied down a little bit with flat revenues, do you expect that to be mainly the basket or mainly visits? Let's say that we're basically taking it as a cautious guidance due to the experiences during the first quarter. We're not actually giving a direct guidance, whether it's like traffic or whether it's basket, but as a combination. Sorry to not give you a clear answer on that, but I'm sure that you understand why not. Yes. It's of course very difficult. My last question here is on the gross margin that is down 120 basis points year-on-year. Is it possible to say anything about how much is related to mix and how much is impacted by freight cost, and how we should think about both mix and freight costs going into the next quarters? Thank you. We are not splitting it exactly, but it's clear that the I would say that the mix has a bigger effect compared to freight costs. Both have effect and the third effect is of course, as we said, that we are Trying to keep a low price image. Certainly this mix has a quite big effect. How it is going in the next coming quarters. As Mika said, that we are targeting to increase our market share in non-grocery products. Which should or if that happens, it leads of course on a higher margin. Freight costs will continue on that, roughly on the same level. That's clear. That's the drivers again, how it goes. I can't give you an exact answer to that one. Of course, the third thing what I mentioned was this, how we are handling our price increases. We are following our competitors and seeing how the market is reacting and clearly targeting to have the lowest price level in Finland. You are focusing on sort of the non-food grocery because is it fair to say that there are discounters within the food sector that have a better price position in Finland? It's mainly in the non-grocery area that you have the strongest price position, or is it a combination? Now, if you look at the sales figures regarding the retailers in Finland, actually Tokmanni has been performing pretty well with groceries, actually. As already mentioned, that the grocery product groups were growing during the first quarter. Yes, we well, first of all, during the first quarter, we could see that people are buying only groceries because that's you know, you need that every day. Obviously we try to win now market share with non-food products, with the non-groceries. Depending on the situation, actually, even if it's with lower gross margin, the groceries still supports the total picture of Tokmanni. Because in a difficult situation, people will always need groceries, and we have a very good price level. There is, let's say, a very important support from groceries. Obviously we would like to sell more non-groceries. It's a really interesting combination where we are balancing at the moment. Yes, that makes sense. Thank you. Thank you. Thanks, Nicklas. Ladies and gentlemen, another reminder, if you wish to ask a question, please press zero one on your telephone keypad. It seems that we have no further questions. Thank you very much. Wishing us all sunny and especially warm spring days. Thank you very much. Thank you.