Welcome to the Clas Ohlson Q1 2024 report presentation. For the first part of the presentation, participants will be in listen-only mode. During the questions and answers session, participants are able to ask questions by dialing pound key five on their telephone keypad. Now, I will hand the conference over to CEO Kristofer Tonström and CFO Pernilla Walfridsson. Please go ahead. Good morning, everyone, and welcome to the Clas Ohlson Q1 report. My name is Kristofer Tonström, I'm CEO, and here together with Pernilla Walfridsson, CFO. So we'll cover a short presentation before we move into Q&A. So I'll start with a business update, Pernilla will take us through the financial development, and then I'll close out with events after the reporting period and the summary. So some highlights from the first quarter, we see that organic growth continues with 10% growth across the first quarter, and our operating profit came in at SEK 203 million, and our margin at 7.7%. Cash flow stable, with operating cash flow SEK 413 million, and the company is still in a very solid financial position with a net debt EBITDA of -0.4, and our EPS in the quarter amounts to 2.3 versus -0.2 last year. We also see a good start to the second quarter with 7% organic growth in August. I will come back a bit more to that. Moving in to the business update and starting from the strategic position that we talked about last time when we closed out Q4. There are three big things that we are focusing on as a competitive advantage for Clas Ohlson. It is all about the assortment, the brand, and the customer meeting. Those three things make us unique, and that's what we're investing in, to drive value forward. Looking at how to leverage this, we are differentiating, and we're focusing, across five niche areas. So we're moving more and more from a generalist retailer to more a multi-niche player. And you can see the niches here at the bottom. We tidy up your home, light up your home, conscious home environment, connect and enjoy, and fix your home. We're doing a lot of work to ensure that our business model is scalable and efficient, and ensuring also a very cost-competitive position. And we want to generate strong free cash flow that we can reinvest into assortment, brand, and customer meeting to deliver a very solid return over time. Looking at our targets, the ambition is to grow 5% a year organically, with 7-9% operating margin, and also to be industry-leading on sustainability, so looking a little bit at the first quarter, how we've been executing towards this plan. We identified three growth drivers for this year, which are very similar to the ones we have been focusing on over the last couple of years, and the first one being making our assortment relevant 12 months per year, and I think the first quarter has shown that we're doing this in a good way. We see all the niches driving growth, and it's really the non-seasonal assortment that's driving growth. Looking at the summer season assortment, it's an average summer, and the growth of 10% organic comes very much from the breadth of assortment across the five niches. We have continued with a high pace, launching new products, and we also have a lot of new news now entering the fall. Second, the growth driver, profitable and growing online business. We saw that the first quarter sales came in at 12%, so slightly above the total organic sales growth of the company. And we do see that our solid omni structure is a competitive advantage, so also with more stores added to the network, it also supports the e-com growth. The Spares Group delivered sales of SEK 210 million, and this is obviously another driver of future e-com growth. The third growth driver is building a robust store network. So in the quarter, we have added three new stores, two in Sweden, one in Norway, and there is a plan to open another five stores now in the second quarter. And for the year, the target is that we're gonna add net ten new stores. Net means that we might open more than ten, and also close some. So net, we expect ten more stores to come into the network. We're also working to make the store portfolio more efficient, and we are doing some rebuilds, and investments in the current store network to make it even more efficient and optimize the chances to deliver a good sales development and return. When it comes to customer communication, we do see that we have strong relevance with our customers, and the customer satisfaction continues to be on a very high level, and we also see Club Clas continuously growing. We now have 5.5 million members, and a year ago, we had approximately 5.1 million members. Club Clas continues to be a driver forward. We have done a lot of work to make our organization more efficient, and we are growing now without adding anything to the organization and are continuously working to make the business model more effective and scalable. On sustainability, we just released the numbers for 2023 when it comes to Scope 1 and 2 CO2 emissions, and we can report a decline or a reduction of 38% across the full calendar year 2023. Moving down into the niches, well, I've already mentioned that we do see all five driving growth, and also we see that our spare parts business is continuously evolving and also the consumables assortment. So we are very much a destination for need-based products, and once the customer enters the store or online, they also find lots of other products that they actually need, and we do believe that the balance between these five puts us in a very good position forward. The last point on customer relevance and satisfaction. So I've talked about ABC, Assortment, Brand, Customer Meeting. Here are some data points to show the progress, starting with product reviews, which is obviously a reflection of the assortment. We do receive a lot of reviews from our customers, and we also get very high ratings from our customers. So the products they buy, they like, keep, and use for a long time. Second, on affordability, one of the most important things for the Clas Ohlson brand is to always deliver value for money versus customers. And we can see from the benchmarking data here that we're doing a good job also versus the discount competitors. Our NPS, the Net Promoter Score, is very stable at fifty-eight. The store network is very strong, and we have seen over the last few years a strong development also of the online NPS. So that in all, all in all, short business update, and I'll hand over to Pernilla to take us through the financial development. Thank you, Kristofer, and good morning, everyone. As Kristofer has mentioned, we have closed a strong Q1, and I will now go through the figures more in detail. Our total sales is up 20%, of which 10% comes from the acquired Spares Group, and 10% is organic growth, sales growth in local currencies, excluding acquisitions. Like-for-like sales was up 7%, and online sales growth in the quarter was 12%, excluding Spares. Including Spares, online sales was 494 million SEK for the quarter, which add to an online share of total sales of 17% rolling twelve month. Looking at the different markets, we have really strong organic growth figures in Sweden and Norway, but Finland's performance is also improving. When it comes to macro factors, we have talked about the volatility in transportation costs quite a few times before, and this quarter is no exception. There has been a sharp increase in spot prices during the past month due to many different factors, with the situation in the Red Sea as an important trigger. We do see, however, a more stable development in recent weeks, but we'll, of course, monitoring the situation closely. We have, as you are aware, different types of transport agreements and a lag effect due to the turnover rate of our stock in trade. The Swedish krona remains weak in relation to the US dollar, which is, of course, affecting purchasing costs. Looking at what has impacted the margin, the currencies, as I just mentioned, had a quite significant impact. Here, I would also like to highlight the positive hedging effect in NOK that we had last year, which this year took off in an opposite direction, meaning that the hedging effect went negative compared to last year. The structurally lower gross margin for Spares Group also impacted gross margin negatively with about 1%. This we have mentioned before, and it is an effect that will fall out of the comparisons once we have had Spares on our books for the full financial year. If we disregard the Spares effect, things we had actively worked with ourselves, such as sourcing and pricing, have contributed to strengthen the underlying profitability. All in all, gross margin declined by 0.7 percentage points to 37.5%. The income statement shows a really strong Q1. Operating profit amounted to 203 million SEK, compared to -16 million SEK last year. As you know, the comparables include last year's write-down of IT systems and costs relating to reorganization. So also when comparing with last year's excluding one-off, profit is significantly up. The EPS for the quarter was 2.3 SEK, an increase from -0.4 SEK last year's Q1. If we look at the inventory, the total inventory level is up. The important factor for the increase is somewhat earlier restocking due to the situation in the Red Sea. The Spares Group stock in trade is included in the figures, more new products and more new stores. Most importantly is that we see that it is a sound inventory that will support future sales with a good balance between different products and categories. Cash flow for the quarter was strong. Cash flow from operating activities totaled SEK 413 million, an improvement from SEK 328 million last year. Free cash flow amounted to SEK 247 million, compared to SEK 184 million last year. Since we are highlighting the free cash flow, I would also like to mention that we define free cash flow as cash flow after investing activities, including amortization of lease liabilities. Net debt, EBITDA, excluding IFRS 16, was minus zero point four%. So we maintain the net cash position and well in line with our financial targets. So with that, I hand back the presentation to you, Kristofer. Thank you, Pernilla. So looking at August sales development, so the first month of Q2, we saw total sales being up 13% to SEK 968 million, and of which 7% organic, with the negative currency effects of 3%, and the acquired Spares Group adds 9, so we didn't have spares in the comparison. So broad-based, Sweden up 7, Norway 8, Finland 7. And it's obviously the Norwegian krona that is impacting us the most. So we do see 8% organic growth in Norway, while we report 1% growth in Swedish krona. So that has a pretty significant impact. The store network was increased by eleven stores, if I compare to the end of August last year, and similar to Q1 and to the previous quarters, we also did see all five product niches driving growth also in August. So a very strong start to the second quarter. Then wrapping up, before we move into Q&A. We are continuously working in line with the strategy we laid out more than two years ago now. We're working with our growth plan, and we believe that the general market and the general consumer situation is still fairly weak and is even more important, or it's as important as ever to execute everything flawlessly day to day, and also to continuously working with a very value-for-money assortment. As I mentioned, we do still do a lot of work in terms of renewing the current assortment, launching a lot of new products and also taking out products that do not perform as well. And we are continuously developing our sales channels. So again, five store openings in Q2, and also working to strengthen the store network that we currently have and continuously growing online sales. We believe that those three factors will help contribute to continued 5% organic growth also moving forward. And as always, we will be tight in terms of cost control, not adding any cost even though we're growing, and also every opportunity to find efficiencies will go after. So with that, we'll move into Q&A. If you wish to ask a question, please dial pound key five on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial pound key six on your telephone keypad. The next question comes from Niklas Ekman from Carnegie. Please go ahead. Thank you. Yes, a couple of questions from my end. Firstly, on the gross margin, can you elaborate a little bit about these external factors that you talked about here in Q1? How do you see these developing over the next few quarters? Are these continued headwinds, and will they worsen or be better? Just generally, what you see on the gross margin. Yeah, good morning, Niklas. So on the gross margin, in Q2, it's pretty clear that, looking at last year versus this year, obviously, the Norwegian krona is significantly weaker. So the effect that we saw in August on the sales numbers, depending, of course, on what happens to the Norwegian krona, that could have an impact. Last year, the Norwegian krona was one to four to the SEK, one to three to the SEK in September and one krona to the SEK in October. So that will have an impact, depending, of course, on the Norwegian krona, because on the sales side, of course, the hedging doesn't help. Then when it comes to the transportation cost that Pernilla talked about, that will have an impact, more so in Q3 and Q4. It'll be too early to tell how much, but it will have an impact. I don't know if you want to add anything to that, Pernilla? I think that that covers it. Yeah, and there's been no change now in, in Q1. There's been no change really in markdown levels versus previous years, right? No. As we reported in the bridge, we've seen an actually positive sales mix development, so we haven't intensified any markdowns. Very clear. And, I'm also curious about your margin target. I know you talk about reported margin, but if you look at adjusted margin, excluding the one-offs you had last year, you are now on a rolling 12-month basis, you're at 9.1. That's above the 7%-9% target. And given that growth now continues to be quite strong also in August, is there any reason to assume that these margins could not continue higher than this 7%-9% target? Any reason why you are sticking to this target at the moment and not revising it? So it's, of course, all about delivering consistently long term. So as you say, we are on the upper end of the margin target right now. We haven't revised it for the year that we just entered. And it will, of course, always be some years on the upper end, some on the lower. So we haven't made any revisions, but of course, our ambition is always to deliver as strongly as positively. But we also do see, as mentioned, that the external world is still, of course, volatile, so we also want to be prepared for anything. But I think that's the comment for now. Fair enough, good. On Spares, I'm also curious, because when I look at the average monthly sales in the first five months after you consolidated it, they grew the sales were in the range of SEK 50 million-SEK 60 million during the winter period. And now in the last five months, they've been above SEK 70 million, and that's been during the summer period. I would imagine that seasonal pattern would have been the opposite or so. Just can you clarify what, if there are any big seasonal swings here, or if the sequential improvement here is mainly related to strong growth in Spares? So there, the seasonality in spares is lower than that for Clas Ohlson, so there are no major seasonal impact. Usually, November, December are a bit stronger, but there are no major seasonal impact. So the driver of the slightly higher monthly sales is obviously growth. We have seen, as reported, as we mentioned before, a good development on the business to consumer side. As we have also mentioned before, the business to business side is a bit volatile, but now we have seen good performance across both. So no major seasonality, but rather a growth improvement, I would say. Very clear. Thank you. And finally, just when I look at your planned store openings, you have seven planned openings now for the next three months, and there is nothing announced after that. Are you temporarily pausing expansion and now kind of evaluating the pickup in store openings that you've seen, or do you expect the expansion pace to remain at a similar pace going into twenty twenty-five? We're not pausing. So the reported ones are the ones where it's all signed and announced. We're still very confident that we're gonna deliver the net plus ten fiscal year 2024, 2025. Net ten might also mean that we open more than ten and then close some. We do not expect that to slow down, and we are on track to deliver the net ten. That also obviously means expectations on a few openings also moving into 2025. Yes. And do you think that could continue into the financial year 2025, 2026? I mean, let's see. We have announced, obviously, year by year now, the outlook, and we are happy with the openings we've done. They do contribute well. And the ambition is to now show strong results also 2024, 2025. So there's nothing, nothing hindering us continuing into the year after, unless anything unexpected. So the ambition is, of course, to continue, but we haven't announced any new targets for the following fiscal year. Very clear. Thank you so much for taking my question. Thank you. The next question comes from Magnus Råman from Kepler. Please go ahead. Thank you very much. I'll start with tying into the last question there about future store expansion or potential such. I mean, you write here in the report also that you expect the online growth to surpass store growth in the market in the coming years. So in such an environment, do you see room to continue expanding the store network beyond this fiscal year? Maybe if you can elaborate in some way on that. So what we have seen over the last quarter is obviously that the online growth is slightly above that of the store sales growth. We do expect that our online business can continue to grow faster than the store sales, driven by a lot of opportunities to basically across the five product niches. Then when it comes to store and online, for us, it's really the combination. So the established omni structure that we do have, when we open a new store, we do see positive impact on our e-com business in the region, and growing online also helps drive store growth. So it's really the two in combination that is strong for us, but we still expect online to have slightly higher growth rates. So they work well together. Right. Perhaps you could also comment on how you view the competitive landscape, maybe in particular in the Swedish market, with, you know, several discounters investing in growth and quite a busy online scene as well with players growing, such as Amazon. How do you see the competitive landscape? Yeah, the competitive situation is, of course, fierce as always. Lots of other players out there doing a great job. And, for us, obviously, that means that the two most important things is, of course, having a relevant assortment that is very need-based, and then having the right price points to ensure that we do not lose any customers to anyone else. And I think the graph that we showed on product reviews, price perception, and value for money, and the NPS shows that we are doing the right things. But of course, we never underestimate the competition. But I think the combination of these things together, also with our great availability, both online and in physical stores, provides us with a strong position, but we never underestimate the competition. Thanks. And you have built a solid net cash position here in recent years, adjusting for leases. And I guess that's especially supported by the two recent dividends that have been rather small. Should we view this as preparing the group for possible consolidation in the market? Or do you see any material organic investment needs ahead, or how should we view it? No, so we do have, as you stated, of course, we do have a strong financial position. Looking at the cash position right now, of course, we have the dividend that is significantly higher than last year, then we are investing in the store network as communicated. We're also making some investments into the IT infrastructure, so all in all, we wanna be in a position where we can invest, then obviously always balancing to ensure that we deliver a strong return on those investments, then the targets for the next few years do not assume any further M&A, but I think we have shown with the Spares acquisition that we do not close that door if the right opportunity comes up, but current targets do not assume that. And second, we are also there are opportunities for reinvestment in the base business, also combined with distributing cash to shareholders now in the during the next year. And we also have a bit higher debt, supplier debt, in this quarter. You have to note that because, I mean, we've taken home products a bit earlier also. So there is also a bit of allocation effect between the quarters. Right. But it's interesting that you mentioned the dividend being up then clearly, of course, from the very, very low level the year before. But I think we have to look back to twenty twelve or something like that to find as low of a dividend as you had for your most recent dividend. So do you regard that as a high dividend even if it was like- I mean, I just- Increasing a lot year on year? Yeah, no, I just stated that it's higher than last year, but it's obviously in line with the dividend policy. We're distributing 53% of EPS. So, it was not the... It was just a statement versus last year's dividend, it's up. And of course, we wanna ensure that we continuously deliver on the dividend policy and are in a position to do that, while, of course, continuously investing into the business to ensure that we can grow and deliver a return on the longer term. Right. Yeah, just to maybe linger a little bit too long on the dividend question, but if I look at the period before the two recent years, you paid out, I think, on average, 98% over a period of some seven, eight years, where you actually had one year with postponed dividend included in that. So, and I think there is also you kept the dividend policy relative to your reported EPS, while that was including some write-downs, non-cash driven. So, I mean, it is clearly substantially lower dividend in the two recent years. Just trying to get sort of the understanding of if you wanted to maintain that policy when at the same time you're building cash, so that you prefer, you know, keeping the cash instead of distributing to shareholders. So the dividend policy obviously is in place for this year, and then it's up to the board, I mean, on the longer term basis. But for this year, obviously, the dividend policy is very clear. And we also believe it's very important to invest in driving further growth and delivering obviously a total shareholder return. But the dividend policy is obviously in place now, and it has been in place for a few years. And it's, of course, all about carefully allocating capital in a way that delivers return. So that's the key thing for us. And right now, we believe that there are opportunities in the business to further invest. We have seen that the growth drivers we've been focusing on has delivered a strong return, especially over the last sixteen, seventeen months, and we wanna continue down that path to drive long-term value creation. Right. Thank you. And just very finally, on CapEx, you retain the or you keep the SEK 200 million CapEx guidance? Yeah. Thank you. Good. Thank you. As a reminder, if you wish to ask a question, please dial pound key five on your telephone keypad. There are no more questions at this time, so I hand the conference back to the speakers for any written questions and closing comments. Yeah, we do have a couple of written questions from the webcast, and the first one is to Kristofer about the Norwegian market. What can you say about the Norwegian market in the first quarter? And I should say this is a question from Fredrik, HandelsWatch. Now, I think both the first quarter and now also August, we see strong organic sales in Norway. The performance continues. The Clas Ohlson brand is incredibly strong in Norway, and we also see that from an assortment point of view, we have taken a lot of right actions to drive traffic and conversion of customers. We're doing everything to maintain that momentum. Any big challenges in the Norwegian market at the moment? ... I mean, no, no other challenges than normal. It is obviously, as for the other two markets, a very competitive market. What we mentioned briefly before, of course, a factor outside of our control is the Norwegian kroner. So that, of course, puts pressure on the results. And also a question about the new store in Stenersgata, central Oslo. How has that performed, and has it affected the traffic to other nearby Clas Ohlson stores? So all in all, we're very happy with the overall store network in Norway. We're also very happy about the new Stenersgata store. It's performed fully in line with expectations, and also the full store network continues to perform. So we're very happy about that opening, and it's going in line with our expectations. And finally, then, generally, any major focus in Norway right now that you would like to mention? The focus is very much on our assortment, continuously renewing that. Second, continuously building our brand versus our Norwegian customer base, leveraging Group Clas as a tool there, and then continuously delivering a very strong customer experience and customer meeting. So very similar to those of the full company, but obviously executing on that day by day in Norway is crucial for us, also forward. Thank you. And that was it from HandelsWatch, and we also have a couple of questions from Arttu at Inderes. First one, consumable markets have shown some signs of weakness in the Nordics. Could you reflect a bit on the market environment from your perspective? How it has impacted, how has it affected Clas Ohlson? Now, yes, the market has been challenged, and we believe. And of course, we would rather have growing markets, but looking at the Clas Ohlson proposition versus customers, having a strong assortment that is based on real customer needs makes customers choose Clas Ohlson. Once they enter a store or online, they find a lot of other products that they really need, buy and use for a long time. So that, in combination with the right price position and great customer service, has given us an opportunity to grow despite the markets. And of course, that is our focus also forward. We can't do that much about the overall market, so it's all about our own performance. And I think the recent results have shown that we are able to go against the market here. Just to build on that, and also, we mentioned it earlier during the call or during the Q&A session, but some comments about the competitive environment? I think I've covered that. It is very competitive, both from local and global players, and it's all about focusing on the things that make a difference for your customers, and investing in the competitive advantages of Clas Ohlson. So of course, we're closely monitoring the market development and all the competitors on an ongoing basis. Furthermore, then, based on sales in August, also Finland is picking up in growth. Do you see that as a result of your own capabilities, or is the market picking up right now? What's your expectations for the coming months? So in general, there are no signs of a market pickup in Finland. The development in for Clas Ohlson in Finland I judge being very much driven by our activities and our actions. As you mentioned here, the growth organically was slightly higher in August, but that's just one month. But all in all, it's going slightly in the right direction and we are currently focusing a lot on the assortment in Finland and on our e-com business. As you've seen, we have not announced any new store openings here and now in Finland, so we're focusing very much on the assortment online and brand. Finally, then, Finland is increasing VAT. Could you elaborate a bit on the impact on Clas Ohlson and how any actions you have taken to mitigate this? Yeah, so the VAT increase is obviously broad-based for everybody in the market. And as always, we work actively with our pricing to ensure that we are competitive from a pricing point of view, while at the same time delivering the desired margin. So it's a balance act, of course, when something like that happens, but it's the same for everybody in the market. So we're monitoring that, and we're working actively with our own pricing in line with our pricing strategy. And that was it, when it comes to questions from the webcast. So, any final remarks, Kristofer? Thank you very much. Thanks for the great questions. So again, now we have closed one quarter, which obviously was strong and in line with our plan. I also think we have seen a good start to Q2, and now it's all about executing the fall and the very important Christmas period for us before we meet again in December for the Q2 report. So thank you very much for taking the time this morning.