Welcome to Byggmax Capital Markets event. My name is Mattias Ankarberg, and I am the CEO of Byggmax Group. If this event would've been at the time of the IPO about 10 years ago, I would probably have been standing in the lumber yard. Today, I'm standing in one of our newest stores in Uppsala, north of Stockholm, where we have our new store concept. Today, we're going to talk about the journey to get here, the journey forward, and also some important trends that are impacting the DIY industry and our company. Welcome. My name is Sanna, Head of Marketing at Byggmax, and I will take you through this live session. Let's start with some housekeeping rules. As you can see, there is a field where you can write questions. Don't worry, your question is not public. Only I can see them, so ask away. We'll try to answer them all in the end during the Q&A. With me, I have Mattias, CEO, and Helena, CFO. Mattias, what are we going to talk about today? Well, we're going to talk about Byggmax, of course. We're going to talk about our position today. We're going to talk about the trends that are impacting us. We're going to talk about the ambitions that we have going forward. We're also going to present some news. Exciting. What kind of news? There are three main pieces of news today. Firstly, we are updating our financial targets to better reflect the growth ambitions that we have. Secondly, we are today presenting a new store format to take Byggmax basically closer to customers' homes, to retail parks and neighborhood shopping centers. Thirdly, we are also presenting the next set of initiatives to drive e-commerce growth for the next couple of years. Helena, what are you sharing with us today? I will talk about the financials, the strong 2020, and also our growth initiatives. The agenda for today look like this. We'll start with a summary and updated targets. Then we'll move on to the three big trends. After that, we'll do some number crunching. It's time for financials. Then Mattias will talk more about the way forward. In the end, we'll do the Q&A. Once again, ask questions. Mattias, over to you. Thank you, Sanna. We'll start with a summary of where we are and where we're going, including the new financial targets. Byggmax was founded just over 25 years ago with the idea to bring a new concept to the market, to bring building materials for consumers at the lowest possible prices. That didn't exist at the time. Of course, a lot of things have changed since then, but there are still fundamentals in that idea also now, today at the present level. Today, we phrase the idea a bit differently. We call it everybody has the right to a fantastic home. As you can see from these pictures, that idea is still quite relevant. These pictures are pictures from our customers' own social media accounts during last year, 2020. What do we mean by the idea everybody has the right to a fantastic home? Well, we mean that to provide that, you need to have the best prices that Byggmax has, the right assortment, a quick and easy experience, and also a caring approach. We try to have a caring approach to, of course, the customers, but also our colleagues and the world around us. One of the reasons why this business model, this idea, is still so relevant today is that the discount trend is so strong. You may know this, but discount is a sort of phenomenon across countries and retail categories where low price or discount players are taking market share. In Sweden and in all the Nordic countries that we are present, Byggmax has a really strong discount position. As you see in this graph, we are perceived to have by far the best prices. Recent numbers also sort of support this trend. These are the most recent numbers from Swedish market, where you could see that in the last year, the number of discount stores increased by 7% when all other stores decreased by 7%. Today, we are, of course, a much bigger company. Let's take a look at some quick basic facts. We turned SEK 6.8 billion last year. We are in four markets now. We entered Denmark just here in January. We operate two segments. Byggmax, which bears the name of the group, represents over 90% of the sales for the group, and is by far then, of course, the biggest segment. We had 169 Byggmax stores at the end of 2020, and we had e-commerce representing 20% of the group sales in 2020. As mentioned, we are the number one in terms of price position in the Nordic markets, and we are also ranked number one in terms of sustainability in 2020 by the Sustainable Brand Index. We also had a really strong 2020. Our sales increased by 29%, e-commerce increased particularly strongly, by 50% last year. Let's take a look at the journey to get here to where we are today because it's really been a journey. I think there are several things that are worth pausing on and reflecting on a little bit before we move forward. There are both positive things and some challenges that have now been resolved. Let's start with the positive highlights. I think, although I was completely before my time, we entered Norway in 2007, has become really successful for us. We were early with e-commerce also in 2007. Maybe on the other side of things, as many DIY projects, things don't always get right the first time. I think we did not do our homework when we entered Finland in 2008. Several things that have now been corrected. Also there was a period just before I joined where the company was, at the time, really focused on acquisitions. In early 2016 acquired two companies, of which the biggest one is Skånska Byggvaror, and that turned out not to be a great idea, basically for two reasons. First of all, it hasn't been great financially. Secondly, it sort of moved the spotlight away from Byggmax and the potential there was to develop Byggmax. Now we had a record 2020, and of course, we, as everybody in the industry, have sort of benefited from the so-called stay home effect in 2020. There's been a pandemic, people have been much more at home and they have done more home improvement. One of the biggest points today is to show you and to talk about that at least part of this performance is actually from Byggmax's own work repositioning and initiatives. Fortunately for us, we have just received public data on the market development. For those of you who follow us, you know that we have lacked good data on the DIY industry, and we are active in the consumer segment, so the B2C of the DIY, and there has not been data. Just as it happened at the same time, two countries' industry associations released data simultaneously almost. Starting out with Sweden, the industry association Byggmaterialhandlarna released numbers to say that the B2C DIY market increased by 19% in 2020. Just around the same timing, Norwegian trade or retail industry association released B2C DIY numbers from Norway that pinned the market at 20% growth in 2020. Byggmax Group increased sales in local currency by 32% in 2020. You may have heard me say 29% before, and there was a 3% negative currency effect in 2020. Two, of course, huge conclusions from this page. One of all, that there's been a super strong market growth, a real boost in 2020, but also a big market share gain for Byggmax in 2020. What is it that we have done and what is it that we are doing, and what is the potential left in that? Well, let's start with what has been accomplished. First of all, let's go back to the Capital Markets Day we had when I was new. It was June 2017. I said that there was a lot of potential in Byggmax, but I also said that before we could get to growth, there were some things that needed to be fixed. I thought it was going to take about two years. It took two years, and now it's fixed. Let's just knock that off the list. What have we done? There are some things on the list that are worth to comment on. First of all, we have turned around Skånska Byggvaror. It's been a journey, but now there are 10 consecutive quarters of profit growth and many quarters of really strong sales growth as well. Secondly, we have turned around Byggmax Finland. That's also been a journey. First we shrank it, then we got the profitability, and now it's also growing really nicely. We've done a lot of work on what we call tech platforms or IT, and basically we have upgraded or changed every major component of a retail tech platform in the last three, four, five years. We have changed supply systems, ERP, POS, online. It's been a lot of work, but now we are operating with modern platforms and can look forward. Last but not least, we have clearly reduced net debt over this period of time, cut it in just over half. That has been on the fixing side of things. Check. What are we doing to grow? Well, we are doing a lot of things. To summarize what we're trying to do before I describe what it is we are doing, we believe strongly in discount and in DIY, and you will see today why that is. We believe you need to make sort of a modern concept relevant to today's DIYers. We are trying to do what we call modern discount for today's DIYers. There are fewer people that day that completely change or renovate a roof or a bathroom. People do a lot of other things, garden, painting, storage, what have you, and there's a lot of opportunities in that. We are trying to make a couple of changes and focus on a few things, and we will speak more about them during the day. Just to summarize it, what we're trying to do is basically shift from offering building materials to offer home improvement projects. Building materials is important for many of those projects, but not all, but we would like to focus on home improvement projects for the customers. We want to offer a quality experience. We would like to have a great price, but also to have a quality experience. We would like to combine the best of the discount stores and of e-commerce, and we would still very much focus on offering the lowest price in the market. For those of you who have followed us, you know that there's been a lot of work that is connected to this. We have developed over the last two, three years, three new store formats, a garden department, a complete e-commerce rehaul, changed branding, even logo. There's been a lot of work going on to get to growth. How is that going? Well, pretty well, I think is the answer. We have more customers, we have happier customers, and we're also relevant for the DIYers we have today. You may remember that I said just before that we grew at 32% in 2020. Here are examples of good sizable and important categories that are clearly growing faster, more relevant for today's DIYers. We grew by 50% in lighting, 40%, 50%, 70% on paint, storage, tools, etc., garden 70%. That all confirms where we're heading. For those of you that also have followed us, you know that in our quarterly reports, we talk about some specific initiatives. The way we have been doing this growth effort is through three main initiatives. We have reported on them, I think, every quarter for the last two years. The three ones are store upgrades, e-commerce, and store expansion or new stores. Let's take them one by one. Store upgrades is our initiative to move the stores from the previous concept to the new concept that I was talking about before. We call it Store 3.0 at Byggmax. Store 3.0 means a wider assortment with more relevant products as per the last page, and also a better experience with a better store layout, a better store experience in general. We can see that when we upgrade stores or convert stores from the old concept to a Store 3.0, sales, like for like, has increased by 6 percentage points, though those stores outperform the others by 6 percentage points. E-commerce has been a really big focus area for us as well. I will talk more about that later today, but let's just say that we now have a really strong momentum given all the things we have done, and sales increased by 50% last year. New stores is still relevant to us. Just going back to one of the first pages I showed that the discount store segment is actually growing. There are still white spots on our map, and there are still stores that don't have a Byggmax or a low price offer. When we do the math and summarize the impact of these initiatives in 2020, and add it up, we can see that it represents 8 percentage points growth above and beyond the market, which actually accounts for the majority of the outperformance versus the market. One of the good news about these initiatives is that we're not finished. There's more to do in these initiatives, and I'll come back to that soon also. Another point today is to say we're actually now presenting some news that add to the future potential, some new initiatives, if you like. They are three, and they are between already live to live in a year's time, basically. Very quickly, the three are that we have entered Denmark. We did it in January. The secondly is a new store format meant to take Byggmax to retail parks closer to customers' home. The third one is the next wave of e-commerce growth. I will go through these more in detail later today. When we summarize where we are in terms of potential, what's left from the things we have already been driving for a while, and what do we believe about the new initiatives? We see a sales potential of SEK 45 billion. Let me walk you through it because it's a good chart to keep top of mind during this presentation. We've divided up into the three different initiatives. On the left-hand side, you have the store upgrades. Then let's go to details. As of December 31, 2020, 39% of our store portfolio was upgraded to Store 3.0. We would like to get to 100%. If we then take the 6% sales uplift multiplied by the average sales per store for Byggmax, you get to SEK 200 million in sales potential. That's that one. The middle one is that we see an opportunity to grow to 280 stores with initiatives we have right now. Some of you may have heard me say 240 before. 240 is with the current store formats or concepts that we have in the markets we have been in. With Denmark and the new store format, we take it to 280. That's around SEK 3 billion, give or take. E-commerce is also a really big opportunity for us, which we will speak more about today. One way to show the potential is to show that today we have 50,000 SKUs online, and we see an opportunity to go to 150,000. Adding also new market Denmark into this, that's a potential of about SEK 1.5 billion. The sales potential is clearly there. With that as sort of a background or context, the board has decided to update the financial targets for the group. I'll go through some of the comments and details around that right now and more in detail later on. I think there are two things worth to point out already now. The first and perhaps the most important change is to the changed sales target. Remember I said before that I said in 2017 that this company has potential and can grow, but there were some things that needed to be fixed first. Now we have phrased, I think, the target more clearly as SEK 10 billion in sales by 2025, which is an important change. The profitability and the dividend targets are not changed. They remain the same as before. We introduced also two more targets. One is a leverage target to reflect that we want to take responsibility for the balance sheet, and another one is not a financial target, but a sustainability target to reflect that we want to take responsibility for the world around us. I'll go through these in more detail at the end of the session today when you've had the opportunity to see the drivers behind what is going to make the difference here. With that, I turn back to Sanna. Thank you, Mattias. It's time to talk about the big three trends, and we'll start with the discount trend. We met with a real expert, Johan Davidson from Svensk Handel, who will share his insights. [Non-English content] Discount and low prices is what have been in Byggmax DNA. We have been offering the lowest prices in the market. We're operating it for basically since the start. We're used to being recognized for it and awarded for it. Behind me is a recent award from just last week when we were awarded the lowest prices in Sweden for a DIY project. Today's consumers, as we heard from our expert Johan, would like more. Low prices is a great starting point, but the customers also want to have a quality experience. We phrase it perhaps a little bit spiced up, so to speak, that modern discount feels like premium. We think it reflects the line we're thinking about here, that we should offer both great prices and the quality experience. I think the classical example, but still very relevant is to me, IKEA. When you go to IKEA, you know that you will have good prices, but you also have good product information. There is a good store experience, there's a really genuine sustainability work. You typically get a little bit of a nicer price. Byggmax is trying to move in a similar direction, still offering the best prices, but to offer a good quality experience. Let's take an example to try to explain what I'm talking about. On the left-hand side here, you have a flooring department for a new Byggmax store in 2017. It has really big and important products at very good prices. Very nicely so, but not more than that. On the other side, on the right-hand side, you have a new store and the flooring department in two years later at the end of 2019. Here you still have the most important products at the best prices, but you have a wider selection. There are more brands, there is better product information, there's a better store experience, and it can be maybe a little bit hard to see, but at the bottom here, there are samples to bring home to see how it works with your current home or the ideas that you have at the moment. Still best prices, but a better experience. To try to give you some more flavor of what we mean, I brought a colleague, and we went to one of our newer stores in Uppsala, just north of Stockholm. The feeling that we want to invoke to the customers coming into this store is that this is a place where they can be in and out real quick. It's high competence, it's a carefully selected assortment, and the quality is high, but the price is a sensible, good price for the customers. The new store format that we are looking at here is really an attempt from us to do two things. One of all is to be broader and more relevant for more types of customers. We introduced more product categories. We are always been really good at construction, but here's now a broader set of home improvement possibilities for the customer. The other really big point with the new format is the whole layout and design of the store. What's new in this concept is that we have rearranged the whole customer track, this spot here. This is a spot where you can get a really clear overview. It's easy for the customers to understand where they find the product that they're looking for, and also in this direction. You see everything from this spot here. This is one of those categories, departments that we completely changed the idea of how it should interact with the customers. We built the actual customer track around the service desk, which supports both the cash register, but also the paint tinting. There was one really good reason for that, Mattias. For efficiency for the customer, but also for the staff, because we can offer paint tinting. As you are probably doing right now. At the same time, if there is a customer at the cash point, you can just pop by and actually, if I'm standing from here, you could see the cash point area really well. Even out to the outdoor area if there's a customer who wants to pay from the car, right? Yes. Very efficient for you and the customer. Very efficient. We analyzed what kind of home improvement project customers are actually doing these days. I think it was just over 200. Yes. Based out of that, we said, how do we select a small set, but still the necessary product that the customers need to do those projects. It's really a deep detailed work through the buyer, the supplier, space management to develop the right assortment component. This department here really performs for the customers. It's a pretty nice experience. I think combined to previously, there's also more brands mixed with private label, and there's more instructions about what tool to use for what purpose, et cetera. One thing that we decided on is to develop garden assortment because we wanted to be more relevant for more types of projects for the customers and also to move away from only assortment in construction to the whole actual home. The way that people buy flooring has changed over the years. 10 years ago, 15 years ago, you could have a very small assortment of high-running products, but today people want to choose from a much wider range of products. This is an extension of the traditional assortment that we had just in the store, and we can see how customers are moving from picking up the most common products in the store towards actually ordering online to get it home delivered. Right. For pickup in the store for that matter. I know that something that is becoming really popular really fast is these floor samples. True. It's one customer out of four that order flooring online have previously ordered a flooring sample to be shipped home or brought from the store. Right. That's a really important factor. A really important part of the Byggmax experience is, of course, the drive-in. Yes. This is a very typical cold storage for Byggmax. It is well organized, and it is plenty of space. You can park your car by the side to load products and other cars can get around. We also have a really efficient way of checking out. If you do not want to check out in a normal cash register, you can do a self-checkout. Efficiency and time efficiency is really important for the customer experience in DIY. Actually, the customers want to do their projects, want to fix their garden or paint the wall, and not spend time in the store. If you're a discounter and have the best prices, the lowest prices to the consumer, you need to have the lowest costs. That's sort of in Byggmax DNA for many times. The whole concept is built around self-service. Another, I think, important element of being efficient with the customer is that the stores are located quite close to where the customers live, so you don't have to drive that far. We know that for many projects, customers come 10-15 times to do a home improvement project. Looking at numbers, we see that it is actually frequency. That is the most important driver of this. New customers and customers returning more often is the most important driver of the increased sales. Byggmax has always been a diamond in the rough. I really think that we are sharpening the edges now on that diamond. Let's look at the results of this change in terms of position. As alluded to earlier, we are more relevant in more categories, but we are also actually appreciated more and more by more and more consumers. We are, as I said before, used to winning awards for having the lowest prices, but now we're winning other types of award as well. Let's look at some numbers. There's actually a 10 percentage point development improvement in Net Promoter Score in the last two years among Byggmax customers. That's a lot. 10 percentage points in customer satisfaction, so to speak. There is also more customers, consumers in the Nordics who think that they are sort of willing or could consider shopping at Byggmax as an option. 4 percentage points more consider Byggmax to be a relevant alternative, which is also a pretty big number. Again, awards from lowest prices still remain, but now we also get rewards for the best DIY chain in Norway in general by the Norwegian Consumer Council or the best paint, our private label paint, by another independent survey. That concludes our view on the discount trend and how it impacts Byggmax and what we're doing to benefit from it. With that, I turn over to Sanna. Thank you, Mattias. Let's move on to the second trend. E-commerce is growing, and the landscape is changing. The world's largest e-commerce player, Amazon, is opening up physical stores, and brick-and-mortar stores are opening up online. These days, people might not even agree what e-commerce is. Let's see what e-commerce is for Byggmax. Thank you. As we already described, we are doing really well on e-commerce at the moment, and sales are increasing well. We thought we'd take the opportunity now to give a bit of a broader picture of what e-commerce is to us. I'll talk about three things. First of all, what e-commerce means to Byggmax. Secondly, I'll give you some more numbers and data around our e-commerce business. Lastly, I'll talk about how we achieve those numbers. Let's start with the really big picture. What we are trying to do with e-commerce is sort of take an extended version of the Byggmax concept into the digital world, if you like. What do I mean by that? Well, the business idea of everybody having the right to a fantastic home is still the foundation. We believe that the best prices are absolutely relevant online, maybe even more so. We would like to offer the right assortment, not just any assortment, although it's wide. We would like to have it pre-selected. It should be a good, quick, and easy shopping experience, an e-commerce experience, and we also would like to show that we care. Actually, one thing that we don't care so much about is how and when the customers shop. We try to provide many different alternatives for the customer to basically suit their needs, pick how they would like to shop. This is also an area where we have done a lot of work over the last two years, invested a lot, technology, site design, deliveries, bigger assortment, et cetera. We'll talk about some of that today, and then also about what is to come. Perhaps the most important point you need to remember about e-commerce at Byggmax is that it's a real opportunity for us, and not a threat. This may be a bit different than from other retailers. Why is that? Well, to understand that, we have to go back to the Byggmax starting point. We, again, are a discounter that are used to having just a few products or a few SKUs in store to offer all you need for the most common home improvement projects. With e-commerce, we can offer a lot of assortment, a lot of products, and we would like to be what we call relevant for all home improvement projects. That opportunity is actually pretty big. We can look at our numbers here and say that today we have just over 50,000 SKUs online with Byggmax. A competitor here in Sweden has 150,000, and if we look at the world's biggest DIY player, Home Depot, they have over 1 million SKUs online. That's a big number and a big opportunity for us. Let's look at the numbers as they stand right now. This is Byggmax branded e-commerce 2020. Sales was SEK 650 million, 50% growth, as already commented on. That breaks down into orders and average order value or AOV. Orders increased by 72% to 239,000, whereas the average order value actually decreased a bit by 13% because we sold more things of smaller goods and smaller value. This number, SEK 650 million, represents 11% of the Byggmax segment's sales, just above the market average of 9% in 2020. Again, 50,000 SKUs available online, and those online exclusive SKUs represented about half of the e-commerce growth. We also get the question sometimes, are you profitable in e-commerce? The answer is, yes, it's absolutely profitable. Profitability is also improving, still it is below the total average. Now we talked about the what. Let's talk about the how, let's talk about the how from a customer point of view. I think we have all seen many complicated charts trying to describe digital business models or e-commerce models. We made a really simple one, but we think it still serves the purpose. Five components that we are working really hard on to provide the best customer offer for online experience in DIY for Byggmax. We already talked about product, how that's an important opportunity for us to continue to increase, to provide a wider assortment and more projects. We talked about price. I think by now I have mentioned the best price many times and that we are a price leader and we think it's really important, perhaps even more increasingly important online over time as well. There are three other areas where we at Byggmax may be thinking about things a little bit differently. We have actually been doing maybe even more work in the last two years. They are the site, the website, where we would like to offer the customer a bit of a different experience than many others do. We are talking about deliveries, which is really important to us at Byggmax. We actually consider deliveries to be part of the customer proposition, part of the offer. That means a few things that we'll come back to in a minute. Infrastructure, already talked about how we have upgraded the technology, but actually we've also done a lot of work to provide a good physical infrastructure, which sets the foundation for a lot of the things that we are seeing the results of right now. Overall, we're trying to build here a kind of platform for quick and easy e-commerce shopping of a wide assortment at the best prices. I thought I'd walk through these three a little bit darker boxes here and tell you the Byggmax version of how we do things. Let's start with the site. Instead of me showing another PowerPoint page, why don't you and I, Sanna, have a look at the e-commerce site. Now we're looking at the Byggmax site, the Swedish version. Obviously you can shop this as any e-commerce site, I mean searching for products or by product category. What we're trying to do with Byggmax is to provide sort of the context of the project for the customer. Sanna, why don't we continue with the flooring example from before? I think it makes sense. Let's say we're in the mood for a wooden floor today. We will have a quick glance through. Let's say we would like to go for a sash floor today, solid wood, oak. At Byggmax site, what you will see is instruction videos for how to do the project. There are samples, as we've talked about before, both you can pick up in store, but actually you also order online. We also provide a list of other things you need to complete your flooring project, so you don't miss out when you order everything you need at the same time. You can choose to pick it up in store or get it sent home. There is more product information for those who are really interested. Sanna, I know that something is becoming really popular is also to get inspiration from others. Yeah, this is user-generated content, where we actually connect our customers' pictures with our own assortment, so it's easy to find inspiration and the right product. Really good. Thank you to all the customers that are helping out. I know also we are building out quite a lot the content for how to do many different projects. If we stick to the flooring one, just an example, there are much more details to go to for the ones that are really interested in learning more about how to do the flooring project. Right. Let's take the next part, deliveries. I mentioned before that we think deliveries should be part of the customer proposition, actually part of the offering, so to speak. What do I mean by that? Well, let's back up to what we commented on earlier. We know that DIYers actually want to spend their time doing projects. I think all of us want to fix things when we're in the mood for fixing things, and not spend the time visiting the store or actually not waiting for our e-commerce orders. We would like to take responsibility for that at Byggmax, and we are trying to approach this in two steps. First of all, what we've been doing lately, well, recently for the last two years or so, is to introduce many new opportunities in terms of deliveries, delivery options. The second part, I'll get back to when we talk about the way forward and the new e-commerce growth initiatives later on. We see that introducing new delivery options helps more customers and more customer needs, so to speak. I'll try to give some detail on this, and this is probably going to be one of the more detailed, maybe the most detailed page I'll go through today. I'll also try to make two points on one page, which is always a bit tricky. Let me walk you through it and see if we can get there. This chart shows the number of e-commerce orders at Byggmax. On the left-hand side, 2019. On the right-hand side, 2020. You may remember that the total increased by 72%, which I mentioned before. If we slice this and take it step by step, we can see that starting at the bottom, what we call large goods, so bulkier products, Byggmax traditional core of sort of heavier building materials, terraces, sheet materials, those kind of things. Orders for that increased by 42%, sorry, 45% in 2020. Very good, of course. Very happy about that. Some new delivery options actually impacted that too. We've introduced express options, choose your day flexibility, et cetera. We look at the next section, which is the online exclusive assortment. Those orders increased by 54%. Partly why those are growing faster is because we've added assortment back to the previous point around product. We have two other ones. The home delivery of what we call small goods. Now that we have a broader assortment and are relevant for more types of needs, we realized we have newer product that we could send the different ways, and that there were some unmet customer needs. Quite simple, but we introduced a sending parcel to pick up point offer, which is very much alive in other types of retail categories, but not so much in DIY. That went from almost nothing because we started to not a lot, but 9,000 orders in 2020, and still, of course, a very good growth. The big thing that has really grown the fastest and is becoming very substantial is collect in store, where we looked at other industries in retail and said that needs to be a good customer offer also in DIY. We introduced that in, I think it was 2018, and it's grown really fast, and today it represents 18% of all orders in 2020. Growing, as you can see, much faster than the other delivery options. What we're trying to illustrate here is basically two main points. First of all, when we introduce new delivery options, we meet new customer needs, and we get new sales. That helps sales. The other part is to say that we are delivering really well in terms of performance for e-commerce of the historical core, the large products, but actually all the other things are growing even faster, which is another example of how Byggmax in 2020 is becoming much more relevant for more types of customers. The last point I'd like to make around e-commerce is maybe also slightly complicated, but the point is to try to describe to you how we achieve this and still be a low-cost, low-price operator. Part of that is due to the infrastructure that we are building. I'll skip go through the details on tech and just note that we are now on a modern tech platform that we are happy about and can continue to develop. There's also a lot of work been going on the physical infrastructure. What we have done is to try to think about our store network in, I guess, slightly different way and do a lot of changes and upgrades to have what we now call multipurpose stores, so they can do several things for the customer. If we walk through some examples, I mentioned before, if we start with the left-hand side, that we ship the heavy building materials from our stores. The reason for that is efficiency. It's hard to send a complete terrace project around Sweden or Norway and get the economics in that. If you send it a couple of kilometers from the nearest store, that's a good business. The store in that respect works as a fulfillment center and serves all the customer orders of heavy and bulky goods. If we look on the other side of this graph, you can see that it serves as a pickup point. As mentioned before, that collect in store is growing really fast, so the customers are also using the locations these days to pick up products that they have ordered online. Showrooming is becoming even more important. This flooring sample, I think, is again a good example of really fast growth, 3x in the last year. Actually just having a store helps e-commerce. When we open a new store, we see that e-commerce in that geography, in that geographical area, increases by on average 15%. What we're trying to show you in maybe a bit more complicated charts in this section around e-commerce is basically three things. First, yes, we have a strong sales momentum. Sales increased really well last year, 50%. It's a big opportunity for us to continue to grow. Thirdly, we are tweaking our store network to actually support the e-commerce business to make the best out of both stores and e-commerce. With that, we conclude the e-commerce part, and I'll turn to Sanna. You'll come here, Mattias. Come. You're going to have a chat with me now. Mattias, all this talk about the retail death, physical stores are closing down and o nline stores are taking over. How can Byggmax stores and e-commerce coexist? Well, I think two main parts to the answer. Firstly, as we saw in one of the earliest charts, this retail death has not been the case for the discount segment. The discount stores have actually increased while other stores have decreased. The second part, I think, of the answer goes back to what I just described just recently, that actually, we see that the stores and e-commerce are supporting each other. E-commerce grows because we have stores, and I didn't go through it, but actually stores are also growing because we have e-commerce. What about the profit? Yes, profitability and e-commerce is lower than for the stores. The reason is the product margin is lower, but it is still profitable. It is a slightly different business model also that ties up less inventory, net working capital is much better. It's profitable, it's improving, but it is still below what the stores deliver. This year's online shopping has really exploded. Yeah. Has it been the same for Byggmax? Yes, of course, the sales was really strong. I think it's also really interesting to dig into some e-commerce data. I think we have a lot of new customers at Byggmax's e-commerce in 2020. We saw, particularly during spring, that I think it was, as in other industries, the sort of elderly generation discovered e-commerce much more than they had done before. A lot of things have really, I think, sort of almost leaped forward for e-commerce in 2020. What do people buy online? Is it the same as they do in store, or? Yeah, it's a good question. In total, I'd say it's more similar than different. People buy a lot of different things online. There are some categories where we have a much wider selection of products online that we don't have in stores. Of course, they are sort of over-represented online. Garden is one example with a lot of garden equipment and tools and all kinds of varieties around that. All kinds of sort of bathroom products. Flooring is another example. Actually people are shopping most things online these days. Thank you, Mattias. If you want to know more, a friendly reminder, keep sending in questions. We'll go through them all in the end, hopefully, during the Q&A. Now it's time for the third and last trend, the home. Let's talk about the home and home improvement. We'll start off by talking about the home improvement market or the DIY market. I think if you should remember one thing from this section is that it's a really big market basically. We'll share a few more things than just that fact. We can see, as you may know, that home improvement and DIY is really dear to the Scandinavians. Actually, Scandinavians or in the Nordics have the highest DIY spend per capita of any country in Europe. There are several reasons for that. Among them are that we have high taxes in all the Nordic countries, so it's expensive to use craftsmen. Many own multiple houses. There's a permanent house and a summer house or maybe winter house. There's also been a long tradition of doing DIY, which goes back to how we build things and lumber, timber-based constructions, et cetera. If you ask consumers why they do DIY, it's basically money and pleasure, you could speak. Just some recent data to give some more highlights on that. When you ask them specifically why they do it, the number one criteria that comes up is to save money. It's cheaper to do it that way than to use craftsmen or something else. Also two other really important factor is, I get it the way I want it. The outcome is the way I would like it to be. I have control. That's a really important factor. Also that it's fun. These are multiple choice questions, but there's big commitment around both those factors. The market is a little bit difficult to pin down in terms of public data, as we talked about before. We are happy that we now are starting to receive some publicly reported figures on the B2C market, let me try to walk you through it, and we'll do it in a couple of steps. If you think about it in sort of circles or bigger and bigger scopes, the smallest one, the tightest one is sort of Byggmax's historical core, building materials to consumers. That is about a SEK 75 billion market in 2020 across the Nordic countries. If we take the slightly wider definition, which is DIY, there you have things like garden included, it's SEK 120 billion in the Nordics in 2020. If we take the widest definition of the business we are in, home improvement, and there we include things like kitchen and white goods and some other things, it is even bigger, SEK 300 billion. By that definition, home improvement is the second-biggest retail category on the planet. When we ask consumers not only why they do DIY, but also what store or what outlet or what channel they would like to buy from, what is important when they purchase things within DIY, there are three, I think, insights that come out. First of all, price, value is the number one consumer criteria in DIY, clearly. The second one is the proximity of the store location. We talked about it before. People want to fix their projects, get it done, not spend time in the store. The last one is, of course, digital, which is increasing a lot. This is also a category where there is quite high involvement. There's actually also a category where we believe there are maybe some misunderstandings about the consumer, that all DIYers would be old or everybody's outsourcing things to contractors, et cetera, which is clearly not the case. Let's just look at some statistics and then some trends around that. 75% of all Scandinavians say that they built something last year, which is slightly higher than 70% in 2019. If you ask people about do research on sort of emotional connections or why they do things, what emotions they relate to it, the number one thing that comes up in terms of emotional connection is 70% say they would like to do projects because it creates a better home for themselves and their family, which is a very nice thing to say and maybe shows a little bit of the Scandinavians' love for the home, it's also clearly a high engagement piece. Only one in 10 of all consumers always use contractors to get things fixed, I think, it's actually been decreasing. It's a little bit less than 10% now. The average age of the Swedish DIYer is 46 years old, just a tad above the average age of the IKEA consumer. This market has also been changing. Consumers have been changing behavior, not just now during the pandemic, but for a couple of years. I think there are some important things to highlight. First of all, there's been a tendency to sort of what we call do the fun part. That means that there are fewer people today who either have the ambition or the competence or maybe the acceptance from the insurance company to completely redo a bathroom or do a roofing project. People do more smaller projects. They do garden work. They do painting. They fix the garage. There's storage to be fixed, et cetera. There is also a trend to do part of the projects and then to outsource other parts to a craftsman. Another really important and clear trend is that some consumers don't feel that they may get fooled, may get cheated if they use craftsmen, and they don't like that experience. I think the whole price transparency with e-commerce has really helped that. There is therefore a trend towards what the industry calls BIY, so buy it yourself. Consumers buying the material, but then letting contractors do the installation or the actual work. Then, as we've talked about already today, there's also clearly a shift to value. It's been going on for a while with the discount trend, and in DIY, it's been particularly stronger with the younger consumers, and of course, digitalization and e-commerce. If we look at Byggmax's position in this market, this is actually also a quite important point to make, we have a very clear position and a bit of a unique position, I would say. Again, this market is a little bit wide or varying in its definition, but if we look at it from a scale, on the one side you have more what's called hard DIY or building materials, on the other side, you have more DIY or even home improvement. Let's call it DIY. Home and interior, it says here. Byggmax is selling things along all of this scale. The main part we're selling, the traditional core, is in the building material side. The two main competitor groups that we have are what we call the trade players and the big box players. The trade players are mainly focused on serving B2B, so construction companies or craftsmen. They are really good with service, logistic solutions, et cetera. They are competent around their assortment and the projects. They are, for a consumer, highly priced, sort of expensive. The way they work is they do individual pricing towards the B2B customers. Byggmax's edge versus the trade players is clearly price. Then there are the big box players, and there are many. They are all over Europe, North America, and in many more countries, actually, they vary a little bit by market. The biggest ones that we have in Sweden, where I'm standing today, is BAUHAUS and then HORNBACH. They have basically a one-stop shop with a very wide range of products. Also, not always, but often have a really low price. They mainly serve consumers, but also B2B players. That is an offer that many people like. Not all, because it's a bit big and time-consuming, but many like it. The advantage for Byggmax is that the big box players only have a handful of stores. They are not in so many locations, whereas Byggmax has, as you may know, 169 stores across the Nordics. We have two clear competitive blocks, and we have sort of two clear competitive advantages versus those two. As we continue to grow, we will of course discover new competition and meet new competitors along the way. That is the competitive landscape. Then to be a little bit forward-looking on this last trend, we have noted several interesting things that have sort of been accelerating during the pandemic year 2020. I think I'll go through them quickly. We see that the home is having a bigger role in consumers' lives. Obviously, people have been staying much more at home during 2020, that led to more home improvement work. I think there is now almost, I think, a consensus that the home will be more important also after the pandemic, probably for two reasons. First of all, at least some people will be working at least some of the time from home. I think all studies basically point to that. Secondly, the staycation trend also seems strong with people that have bought summer houses and boats and pets and what have you. The home is just increasing in terms of role in people's lives. Actually, the second thing we see accelerating is that the home is also an area where consumers are willing to spend. It's increasing in terms of share of wallet as well. We can see that obviously in home improvement, but other things have also increased really strongly, like furniture and housing prices. Obviously, not all categories have had really good growth during this year. Another trend, which I think is one of the more exciting ones, is that we also see a new generation of DIYers coming up. It's seen across Europe. I think the biggest company in our industry, Home Depot, put it really nicely in the last quarterly report when they put some data in that shows that consumers, millennials that have been doing home improvement work, are now coming back and trying to do more and more bigger projects. We see the same at Byggmax, whereas particularly from the autumn and onwards, that younger customers have been the one driving the sales growth. We've also already talked about discount accelerating and e-commerce accelerating as two really important trends. To give you some more flavor around trends related to the home, we sat down with two more experts to hear their views. 2020 was an interesting year from a research perspective, of course, from what's happening in the home improvement market. The market was booming. What we see in the data is that people have been doing more home improvement jobs than ever. Last but not least, people were doing more projects themselves instead of hiring a professional. The engagement is enormous. Not only that, it's also that they're spending more time thinking about the jobs. They're spending more time orientating on home improvement projects, and also they like it more. It doesn't really matter what we are testing when it comes to learning new skills. Group of millennials is always the most enthusiastic. There is a lot of interest among the millennials, which has always been the case, but now in the last year, we've seen that they really picked up the brush and really started to do home improvement jobs, and that they have a positive opinion about that. I think the factor of millennials not being capable of jobs and that would lead to a more do- it- for- me market, I think we made a shift on that last year, and that is something that we can profit from in the future. The millennials are becoming a bigger audience for the DIY retailers in the next years. I don't have a crystal ball, of course, but we did ask consumers if they intend to do more home improvement than they did in the past year, and they're slightly positive about that. We clearly see that spending more time at home leads to more home improvement. [Non-English content] Mattias, what do you think? Do you think this trend will increase? I think, 2020 was a pretty exceptional year, and of course, a year that tragic pandemic that we hope will go away as soon as possible. I think in terms of home improvement market, it was also quite exceptional. People were really home and had the time and to do home improvement work. Because the home will be more important after the pandemic, we believe that the market after the pandemic will be bigger than it was before the pandemic, but not as big as during the pandemic, if that makes sense. Better than 2019, but below 2020 in terms of market size. It feels like people have been renovating like crazy this last year. Aren't people done? Are they done? Yeah. We get that question sometimes. Maybe, mainly from people who are not DIYers themselves. No, we don't see the numbers at all. Actually, we're tracking this quite closely, and we have actually a public report coming out soon where we will share some insights on the DIY consumers in the Nordics. We can see in the numbers that consumers are just as eager or planning to do just as much home improvement work in 2021 as they were planning to do in 2020. Thank you, Mattias. Now let's move on to what you all been waiting for. It's time for financials. My presentation will cover three areas, our growth initiatives, cost efficiency, and our financial position. For Byggmax, 2020 is a year with record sales and market share gains. The market in 2020 was very strong as a consequence of people spending more time and money on their homes during the pandemic. The market, as Mattias mentioned, growed by 20%, but at the same time, Byggmax grew by 32%. There are many factors leading to us growing more than the market, but we have calculated that some of the main contributors to strengthening our position is what we call our initiatives. Let's talk about the financial aspects of these initiatives. The initiatives are store upgrades, e-commerce, and new stores. If we start with the store upgrades, we aim to have all of our stores upgraded by 2023. At year-end 2020, we had upgraded 66 stores, which corresponds to 39% of our store portfolio. Why do we think it's so important to upgrade our stores in such a short period? As we saw in the film, we can see that the upgraded and the updated assortment is appreciated by our customers. The upgraded stores have a stronger gross margin from the mix of products and a higher product mix covering a broader spectrum of the do-it-yourself projects. The investment in the upgrades is low. It's SEK 1 million per upgraded store. What is the achievement of the upgrades? We see 6% growth in our upgraded stores versus the other stores. Our next initiative is e-commerce. We have in previous years invested in our platform and current CapEx is low in this area for us. We can accelerate our e-commerce and have economies of scale on our platform. This is an area where we have high ambitions. We will continue to grow with broadening our assortment and having adopted delivery options to our customers. Our e-commerce has lower margins and gross margins than stores, hence it will impact our gross margin over a period when the share of business of the e-commerce will grow. We would still have a profitable e-commerce business that remains. As a result of the e-commerce initiatives, we have received a profitable growth of e-commerce of 50% sales in 2020. Our last category of initiatives is new stores. We constantly work with elaborating on our store portfolio and being a discounter, there are still some white spots on the map. We constantly see a potential of portfolio of 280 stores. We now have four markets, Sweden, Norway, Finland, and Denmark, which we entered in 2021. Invest in new stores drive OpEx while profitability and maturity is reached at a later stage. We have calculated that new stores contributes profitability and approximately after two years, and the sales maturity is reached after three years. New stores have contributed with 4%-5% sales growth in the last years, and opening a new store is a CapEx of SEK 4 million-SEK 6 million, depending on store format. The result of this initiative is a further 10 stores opened in 2020. These are our initiatives. We see that store upgrades, e-commerce, and new stores contributes and drives growth, and is appreciated by our customers. We'll continue to work with these initiatives, we see that they have more to give in the years to come. Our next topic is cost efficiency. Byggmax has the lowest OpEx in the industry. We have said this before and it still holds. If we compare Byggmax average OpEx as a relation to sales in 2017- 2019 compared to peers in the Nordics and in the rest of Europe, Byggmax has the lowest OpEx in the industry. How is this achieved? We have a strong culture of cost consciousness. We continuously invest in efficiency, generating savings through modernizing the way we work. A good example is the development of our direct store costs. If we look at the period between 2016 and 2020, we can see that we have constantly driving efficiency projects in keeping the costs flat despite inflation and index regulations in this period. We realized scale effects as provided in 2020 OpEx. In 2020, sales grew by 20% year- on- year, while OpEx grew by 10%. Most of our cost increase is related to growth initiatives. If we look at the like-for-like sales in 2020 and the increase in our cost in 2020, we can see that the increase is mainly driven by new stores and growth initiatives. We have now talked about the growth initiatives and the cost efficiency. Let's go into our next topic, the financial position. 2020 is sales growth and scale effects. 2020 is all about records. We have record net sales of SEK 6.8 billion, a growth of 29%. We have a negative currency effect of 3 percentage points. We have record gross margin of 32.6%. Gross margin was further strengthened by product mix improvements and volume. We also have record EBITDA increased by 160% and margin doubled to 10.4%, proving strong scale effects in the period. In addition to a strong performance in 2020, we have, over the last five years, generated strong cash flows. Between 2016 and 2020, we generated cash flows from operating activities of SEK 1.9 billion. When analyzing cash flow, it's worth pointing out that seasonality from high and low season as seen in the graph. Even though growth could somewhat mitigate the seasonality, cash flow will continue to peak in Q2 going forward. The strong cash flow gives us a good headroom for further growth investments. We have had a CapEx spend of SEK 800 million in the last five years. We have an average CapEx of SEK 160 million per year during this period. Our maintenance CapEx is low. It's approximately SEK 38 million per year. CapEx is driven by our growth initiatives and store upgrades. We see that our initiatives add to sales growth. We will continue to invest since they have more to give. We will invest in upgrades, e-com, and new stores going forward. We also have a strong balance sheet. We have strengthened our balance sheet and net debt position in the last years. We have reduced the debt from SEK 1.2 billion- SEK 467 million at year-end 2020. We have the net debt EBITDA ratio, which we have as a financial new target, and this also follows some of the cash flow seasonality pattern. The ratio peaks in Q4 and Q1, where we have a ratio in the period of 3.2x and down today to 0.6x. Our financials allows for operational flexibility, organic growth, and dividend in line with our financial targets. Thanks for the presentation. It's your turn now to come and have a chat with me. Welcome. Thank you. Helena, it feels like you've been with the Byggmax for ages, but it has only been a year, and what a year. What do you think people doesn't understand about Byggmax? It is a cost-conscious organization, but also very business-minded. There is a lot of experienced people and high creativity. Developing new formats and analyzing categories is a lot of energy, and we have a lot of fun. You mentioned that the sales from the new concept generated 6% per store, but how can you be so sure? We measure everything at Byggmax. We have upgraded and non-upgraded stores, and we can measure all the way down to each product in the cold store and in any part of the stores, the sales. Thank you, Helena. You will be back later for the Q&A. Remember, send in questions. Don't forget it. Now it's time to look ahead and learn more about the way forward. Mattias, take it away. Thank you. Let's talk about the way forward. I hope we're all warmed up, because at least this is my favorite part of the presentation. I have to say, probably the part where I miss the most having a live audience, but I hope we will catch up for it at some point. When we talk about the way forward, let's just remember that sort of point of departure for us at Byggmax is this idea of everybody having the right to a fantastic home. The home is really dear to the Nordic consumers' hearts, and we have seen that it's highly relevant also in 2020. What you hopefully have learned during this afternoon is that we, as a company, are in a really good spot at the moment. We have a really strong position. I think it's been maybe overly clear that we are really positive about the discount trend, and we are a clear price leader in the market we operate in. We are also a cost leader, and we are the lowest cost operator in our industry, which is important to us. We also have a bit of a special business model in that we are really successful with stores, as we have seen discount stores still work and grow. We're also perhaps even more successful, at least recently, in online, in e-commerce. We are exposed to favorable trends. We believe that the discount will continue to grow, and we've heard it from experts. We believe that the home is more relevant after the pandemic than before. I think many facts and experts substantiate that. E-commerce will also speak to our favor because we can offer a much broader assortment and be relevant for more customers. We also now have, to Helena's point before, a strong balance sheet that allows for us to focus on growth going forward. In addition to being in a really good position, we also have a strategy that is creating really good results. We've fixed the old mishaps, as we call them, so that's now behind us. Much more importantly, the approach we now take to modernize the discount, to have a modern discount for today's DIYers really drives market share gains, and we are really happy to see that. We also have particularly a strong momentum in e-commerce and strong scale effects. Again, to Helena's point, that when we see good organic sales growth, we get the really good leverage and really good profitability increase. That's the point of departure. Then a last point that is worth to just revisit before we talk about the priorities in the future is this potential we have identified. There is clear potential left from the things that we already have been working on now for 18+ months. That is SEK 3 billion out of these SEK 4.5 billion. Those SEK 3 billion are continuing to upgrade this portfolio to Store 3.0, grow with the existing format in the existing countries, and grow with e-commerce. Then on top of that now, we have the new initiatives related to Denmark, a new store format, and further e-commerce growth. That takes it to SEK 4 billion-SEK 5 billion. What then is our priorities and what is the ambition level and how are we thinking about that? We have summarized it in a very simple page in three points that are sort of core to us, and we would like to just stay on for a second. First of all, our number one priority is to drive profitable growth, profitable organic growth even. We are on a good trend. We would like to continue to move towards being a modern discount offer for today's DIYers. We'd like to continue to take market share in the Nordic DIY industry. I would like to continue to combine great discount stores with a really strong e-commerce. Actually almost every word here is kind of important for us when we try to describe this. We believe that we have to drive the growth. We don't think that expect anything to come every year an increase like 2020. We believe that the home is more important going forward, that the market in 2021 is below 2020. We have ability to drive the growth with our initiatives. We would like to do it profitably, and we would like to focus on organic growth. That's number one. Number two is to continue to generate a lot of cash, significant cash and shareholder returns, as we call it. Helena went through it nicely, I think, to show that we are very cash generating. We now have the ability and the balance sheet to be also providing a good dividend payout in the coming years. Then thirdly, we'd like to continue to sort of explore growth opportunities connected to the Byggmax business. Both those two phrasings are also kind of important. We would like to develop, just as we've done in the last couple of years. We introduced the garden department, the new store formats, and changed the e-commerce and delivery options, et cetera. Sort of continue to expand the circle. It's important to us that it's connected to our core Byggmax business. We believe that most of these sort of newer ideas will be organic, there could also be some acquisitions involved. With a sort of purpose in mind to drive organic growth going forward, like we've done in Denmark, which I will show you soon. We made an acquisition in order for us to be more ready to drive organic growth after that acquisition. This is the ambition. We have on that last point three, continue to expand the circle of Byggmax and test new things. Three new initiatives that we would like to talk about today. I'll go through them now one by one. They range from sort of already live, Denmark, to live within a year. The three, again, are the entry into Denmark, a new store format, and further e-commerce growth. I'll take them one by one. We'll start with Denmark. Why Denmark, I guess, is the first question. Well, Denmark is a really good fit for Byggmax. It is a good size DIY market. It has price-conscious consumers, very much so, which I think other retailers have both suffered from and benefited from. For us, we actually think it's a good thing, that it is a big discount segment. There is a good product overlap, so there are quite some similarities between the assortment in particularly Sweden and Denmark, so we have a lot to bring. It's also competitors that we know. There's a good match between the Danish market and the Swedish market. Also just operationally for us, it's a good fit. We have warehouse structures on the west and southern parts of Sweden, so we are able to serve Denmark through those, and we hope that the borders will be open in not too long, and then it's of course an easy way to just connect operationally by crossing the bridge. That's very nice. If that was why Denmark, then let's talk maybe a minute also about how Denmark. Here we choose sort of a two-step approach. First of all, we made an acquisition announced just before Christmas of a small, very similar company to Byggmax, called, let's summarize it, NLT, Næstved Lavpris Træ, operate four stores around the greater Copenhagen area on Zealand, and pretty good e-commerce business. 30% of their sales is e-commerce. Very good match with Byggmax in terms of product categories, also actually in terms of culture. Not that big, DKK 125 million, a good history of like for like growth and good profitability. That's a good stepping stone for us to get in, to be locally relevant, and to have something to build on, what we then can upgrade and expand to. Separately, we have, of course, more to offer with the Byggmax modern sort of offer in terms of categories. We will also now, just in the coming weeks, open a Byggmax branded Danish e-commerce site offering a wider variety of products for the Danish customers. Moving forward, we will grow, just the way we have been growing in the last couple of years with the three initiatives. We will upgrade the stores, we will open new stores, and we will for sure focus on growing with e-commerce. We believe there is potential here to have around 20 Byggmax stores and a significant share of e-commerce business. That's Denmark. The second point is a new point. For those of you who have been fans of Byggmax, you know that we have done several format developments over the last couple of years. We introduced a new format to serve small towns, where we had needed to sort of push the boundaries for cost efficiency even further to make it even more stripped down Byggmax, so to speak, in terms of offer, to be able to profitably serve a smaller catchment area. We developed a garden department. We developed a big format store where we rolled the garden departments into, and also the Store 3.0. There's a lot of history of us upgrading, and now we are moving forward with three formats, a format for small towns, a regular format, and a large format, and both the last two include a garden department these days. This here, which I'm presenting now, is sort of then format number four, a new format. We call it Byggmax Compact. The idea is to move closer to customers' homes and to move to retail areas, retail parks, as is the common term, or neighborhood shopping centers, as some say. Today, we have a good assortment for many home improvement projects, and we will of course tweak it a little bit more for this format. The big thing here is to take a typical big size, large format Byggmax site of 10,000 sq m, 12,000 sq m, get it down to 4,000 sq m by a lot of work, to say the least, and then put that in a retail park close to other retailers. We believe that that will give us access for other types of shopping destinations and be even more close to where customers live. We will still offer drive-in, a cold storage, and a warm store, and we will have the opportunity to do all of this indoors. We are currently in discussions with a couple of different landlords. We are a bit fortunate that when other physical retailers struggle, we may get some opportunities. We expect to have the first Byggmax Compact open by the early 2022, so in about a year's time. The third news on the growth initiative side is the next wave of e-commerce growth. This goes back to what I was talking about on the e-commerce block, the e-commerce section, about our ambitions going forward. There are three things I'd like to highlight here that we are doing. First of all, we talked about the site and our content and how we would like to offer how-to guides and the context of the project for the customers. We will launch over 200 projects filled with content during this year. The how-to guides, instruction, shopping list, etc. We have actually already launched just two weeks ago the first 80 projects during here now during Q1 2021. The second part goes back to growing the assortment, where we believe we can have a much bigger assortment going forward, and we will add both brands and private label. I think you could summarize it to say that you should expect to see a bigger assortment on Byggmax sites going forward, and you should particularly expect to see the first private label ranges within garden furniture and bathroom already now here during the second quarter of 2021. Then the third part, which I try to focus a lot on also on the e-commerce part, is around deliveries, where we believe that this is part of the customer offer when it comes to e-commerce. I also mentioned that we're taking a two-step approach to this. The first step we've taken is to offer many more delivery options for the customers, and that has served us well, as you may have remembered from the charts. The second step we're taking now is that we would like to take sort of responsibility for the full delivery offer for the customer, and this is done in other retail categories. What I mean with this is that if a product, you should, as a customer, know where your delivery is. If it gets delayed, you will get notified. If it gets early, which actually happens, you'll get notified. If there is anything, in any case, you can check it out through track and trace. This is quite common in several other parts of e-commerce, but not in DIY. We are the first in the Nordics to launch. We call it proactive track and trace. We have actually already launched now in Q1 2021 for a subset of products, and we expect to have this rolled out by Q3 2021. We think it feel really nicely from sort of a Byggmax customer promise perspective to be able to take the full responsibility for the deliveries to the customer. Those are the three news. I think maybe some of you are sitting watching this and saying, "These guys are talking about big trends. They're talking about what's going on in 2020, and they haven't mentioned sustainability much at all." I think just a couple of words on that. It is obviously perhaps the biggest trend of our time. It is something that is really important to us at Byggmax. We, as we like to phrase it, combine low prices with high sustainability ambitions. We have done quite a lot, but there is definitely much more to do. This is a two-hour digital event. You have to prioritize what to talk about. Sustainability is a major topic, and we just decided to not go into much detail into that today. Moving then towards wrap up on the way forward section and connecting this to financials. What does this mean for our financials and for our targets? Let me provide a little bit more detail on the financial targets than I did in the beginning in the summary section. There are, I guess, three types of changes here. There's new targets, there are changed targets, and there are constant targets. Let's walk through it. First of all, I said as before, that this business has potential to grow, but there were some things that needed to be fixed. Now we see that the growth is coming, of course, from the market, but also through market share gains, as you have seen, and we have the actions to continue. We have set the sales target, or the board has set the sales target to reach SEK 10 billion in sales by 2025. We expect that the market will be better than 2019 but below 2020. We have a lot of initiative to execute to get there. In terms of profitability, we measure this as EBITA, and we have an unchanged or a constant target versus before. It's still 7%-8%. We have been higher than that in 2020. We were over 10%. We believe with the market, which is below the exceptional 2020 and some further growth investments, that still being able to reach 7%-8% EBITA should be doable, and that is our target. We're also introducing a target for leverage or for the balance sheet, and this is measured as net debt divided by EBITDA. For the technical details that maybe Helena can go through in more detail, but it excludes sort of IFRS 16, so the lease commitments, and it's based on rolling 12 months on EBITDA. This is set to be below 2.5x, which is we're clearly better than that already now, but we were higher before. This, we feel in management gives us good room to maneuver to both invest in organic growth initiatives and to be able to pay dividends going forward. That takes us to dividend, and that target remains at 50% of net income. The board has already proposed to the AGM here in May that there would be a dividend of SEK 2.75 per share for 2021. The last target that we have included is actually not a financial target, but it's an externally communicated as of now, and it's a target regarding sustainability. We have chosen a target. We could, of course, have many targets, and it's a really broad area, but we have chosen a target that connects to carbon dioxide emission reductions. More specifically, we have chosen a target that concerns transportation. We have actually already come really far when it comes to many of our own direct CO2 emissions. We are buying renewable energy. We have LED lights in the stores. We are for the vast majority, electric forklifts, et cetera. CO2 emissions is perhaps our biggest negative impact if you map us versus the UN 17 Goals and transportation is a big area. We have set the goal to reduce CO2 emissions from goods transport measured as per ton per kilometer by 70% by 2030 compared to the 2010 level, and we were at 32% decrease now at the end of 2020. Those are the financial targets that hopefully the background of today's presentations give some more color to how we will achieve these. As a summary then, the investment into Byggmax can be summarized into five main points. First of all, we are the discount leader in a quite lively and attractive DIY market. We are clearly having the number one price position within hard DIY. We have the lowest cost in the industry. The home is becoming more important, and discount is just growing. That's a really nice position for us. The strategy we're taking to move towards modern discount for today's DIYers is clearly driving market share gains and profitable growth. We are successful both with our discount stores and with e-commerce, which is a great strength for us. We have a journey, a target to reach SEK 10 billion by 2025. We have initiatives that can take us there. The proven initiatives we've been working on for 18+ months have more to give. We already have identified three new ones, of which one is actually already live to add to that. Lastly, financially and importantly, we are generating a lot of cash flow that allows us to fund organic growth and pay dividends for the future. That was the summary and the wrap-up. With that, we turn to the Q&A session, and I will take it to Sanna to lead us through it. Thank you, Mattias. Thank you for a great presentation. It's time for the Q&A. We've gotten plenty of questions, let's start with a guest with an outside perspective. We've asked one of the analysts that's following Byggmax. He's going to join us live over link. Hi, welcome, Andreas. Yeah. Hi there. Can you hear me? We can hear you. Great. Yeah, sorry. I assume you have some questions for us. Absolutely, but I will only stick to a few, so let the others in as well. If I start then, you touched upon it perhaps a little, Mattias, but what would you say has changed during your time as CEO compared to when you started, to make you believe in this SEK 10 billion sales target by 2025? Well, I think, Andreas, that's good. I think I would mention three things in particular. I think when I joined at the end of 2016, I think there were still quite a few areas where we were not happy and not performing that was sort of actually decreasing growth for us. Skånska Byggvaror in Finland, et cetera, where we had to shrink, and that took a while, and also hurt us profitability-wise. That's been fixed. That's one. I think the second one is maybe the more important one, is that there weren't any, or that many at least, clear growth initiatives that drove organic growth in the Byggmax business. Focus has been elsewhere for a while. I think like for like had suffered, as you may know. Now I think, well, we have three clear initiatives that we could all sort of put numbers on and allocate capital towards. I think that is a really important point for us. Then, of course, as a retailer and a consumer, I would almost say nerd, it's really nice to see also that sort of given market share and more customer groups, et cetera, taking on. We now have our own organic growth initiatives that we can invest in. I think that is perhaps the most important one. Then thirdly, the market is always hard to have a crystal ball on, as the experts say. I think everything speaks for that the home is becoming more important going forward. It should all else equal be more positive than where it was at the time when I joined. Perhaps a clarification there. I think you said that new stores could bring up to SEK 3 billion in sales. Was that correct? If so, were you basing that on a 2020 store sales average, or? Yes, between SEK 2.5 billion and SEK 3.5 billion. We'd looked at actually a little bit forward-looking. We believe the market will be not as strong as in 2020. We took it down a bit when we looked at the average sales per store. We are, of course, internally modeling that a bit differently depending on store format. Around SEK 2.5 billion- SEK 3.5 billion. It's important maybe if I should provide some more color on that to say, 240 is the number where we have an identified location, target list. It is based on the existing store format in the existing countries. There's another 40, which we believe in, when we have now done our mapping around Denmark and around the potential of the compact format. Okay. Then a couple on, you didn't talk a lot about the short term, which I think could interest some people out there. Given that you now are meeting more challenging comparables already in the first quarter, how would you say that you have experienced the market so far in 2021? Yeah, no, I think you're completely right. We are meeting an exceptional year. We're not expecting a market as strong. Already, I think Q1 was 23% growth last year, so that's pretty strong comparables. We see a very good market still now in the first months of 2021. I think the stay home effect, if we want to call it that still, sort of really peaked in April, May 2020, and it's been sort of on a gradual decline from then on. Weather effects have been okay. A little bit worse than last year, but not that bad. Spring seems to be coming now, we hope. I think there's still a very good market out there at the start of 2021. Okay, another very hot topic at the moment is raw material prices, which has moved meaningfully, at least on the timber side. How are you tackling that, and what do you think will be the implications for you and for the industry? Important one. I'll try to elaborate a little bit about that one then. Factually first, you are completely right. Raw material prices have gone, maybe not bananas, but really increased. Timber definitely including so. Then actually also on the freight side, we are lucky if we start there that we don't have a big exposure to Asia. It's a very small part of our flow, but we are impacted by raw material prices. I think this industry has shown over the last three, four years that I've been here that raw material prices and currency effects are actually passed on to the end consumers. We are a bit lucky this time because the raw material prices started to come up already during the autumn. I think all the players out there started to see that increased consumer prices in good time. Hopefully, everybody sort of has aligned and be back to the same profit margins here by high season was our thinking, and that clearly is happening. To summarize, we see that yes, raw material prices are up, but consumer prices are up in an equivalent way, which means that the product margin is not hurt from it, at least so far. We'll see how it continues. Thank you so much, Andreas, for your question and your time. Thank you. Let's move on to your questions. Are you guys ready? Yep. Okay. There has been lockdowns in Denmark and Norway. Are you impacted? There has been lockdowns. We are impacted, not that bad, I think is the honest answer. We were not impacted all of last year in terms of lockdowns. Let's see, help me here as I walk through it. Denmark was in lockdown January and a bit into February, it's super small, four stores out of us. Norway has had very local decisions and restrictions. As of just a couple of days ago, sorry, one more thing about Norway is that when Norway do lockdowns for DIY stores, click and collect is still allowed, professionals are still allowed. We have had since a couple of days, lockdowns now in Norway impacting about half of our Norwegian store fleet, 20+ stores. In numbers, it's actually not that bad. Of course, it's not great. Norway is 20%, half of it is impacted. It's a couple of weeks now, and actually our click and collect offer seems really strong because it makes up for quite a good portion of what the store normally would see. Not all of it, but quite a lot. It has impacted us now, but not very much. What is your view on competition? Is the landscape changing? It is changing. It's, I think compared to other retail industries where I've worked, changing not so fast. I think it's been changing mainly on sort of the B2B side where there's been some consolidation, which haven't impacted us that much. I think if you look back the last two, three years, two or three things have happened. Consolidation. I think basically all of the big box players have been focused a little bit more on the craftsmen and the B2B side, so picked that up. Of course, I think the thing that everybody was waiting for was when Amazon entered, and what was going to happen, et cetera. I think so far, we are very little exposure to those kind of categories where Amazon typically is in book and electronics, et cetera. Maybe some, but so far we've seen very little impact just as I think most competitors have. You're not worried? Not for now. I don't want to be the one that underestimates Amazon. I think as of now, we don't see any activity in our categories basically. Okay. How will Byggmax fast e-commerce growth affect your profitability? I think that's one question for you, Helena. Yes. E-commerce has lower margins. Over time, if this share of business will increase, obviously it will have an impact. We are planning on growing on both areas. We still will have a profitable e-commerce. An impact will occur over time as the business grows. Do you want to add something, Mattias? No, I think you put it nicely. It's a growth area for us. It will add profit, but probably decrease profitability in percent. What is the potential, your goal in Denmark going forward? Well, Denmark is exciting. We have done a sort of map, I guess you could call it, a plan for Denmark. We have an initial plan that's really focused on e-commerce, launching Byggmax's own branded e-commerce site quite soon. We also, of course, would like to continue with the combination of stores and e-commerce. We see potential for about 20 stores in Denmark, in addition to the e-commerce business. Another question for you, Mattias. Take a sip of water maybe because this is a long question, so it is going to take some time. Do you have time to sip? Okay. Okay. I'll try to remember all the details. Yeah. The balance sheet target of 2.5x EBITDA is well above current debt. Are you planning for M&A activities and what targets? Good, and as you said, a slightly longer question. Let me see if I could divide that up, and Helena, you have to help me here. Yes, there is now a target to have a leverage of maximum 2.5x. It's measured as what we call it excluding IFRS 16, so excluding the effect of the lease commitments. We had 0.6x, I believe, at the end of 2020, so clearly much lower. I think it gives us a couple of interesting opportunities. First of all, of course, we have funds to focus a bit more on organic growth now that we have things that we see that work. We are not per se focused on M&A for the sake of M&A. As with Denmark, it could be a means to sort of a faster end, so to speak. There are ambitions we have within both geographies, within e-commerce, and within certain product categories where bolt- on M&A could be a faster way there. That could be it. Yeah. What about the market outlook 2021? Is it better than 2019 or? Yes, we believe it will be clearly better than 2019. We also believe, that said maybe before that it will not be as strong as in the exceptional 2020. All right. Well, that's everything. Thank you, Helena, and thank you, Mattias, and thank you for all your questions. If you didn't get your question answered, we will get back to you by email, and all material will be available tomorrow at the latest at our webpage. Thank you for watching.