Tokmanni Group Oyj

OMXH:TOKMAN

Earnings Call Transcript 2022-Q1

[Mika Rautiainen, executive]

Good morning, and welcome to Tokmanni's First Quarter Results Presentation. My name is Mika Rautiainen, and then together with Tokmanni's CFO, Mr. Markku Pirskanen, we're going to present key points and the key results for the first quarter. After that, there is time for questions and discussion.

And as I mentioned, as we say over here, the weaker purchasing power slowed Tokmanni's sales growth down during the first quarter. Tokmanni's target for the first quarter and for this year has been to continue with the sales growth, but we didn't succeed with that. Revenue grew only by 0.6%. And actually, like-for-like revenue decreased by 2.7%.

Last year, during the first quarter, it was very strong growth figures, but I have to say that the main reason for lower sales figures is basically several shocks for Tokmanni customers during the first quarter. First of all, the inflation already started at the end of last year, higher energy prices, higher fuel prices, higher food prices, basically our customers had less money to spend in Tokmanni stores. And the second thing, peak weeks of pandemic in the beginning of the year caused less traffic in our stores. And last but not least, the start of the war in Ukraine caused anxiety for the Finnish consumers. And that also showed in our figures.

Our sales basically concentrated on groceries. Grocery product groups were all growing, whereas non-grocery product groups' sales were declining during the first quarter. This is the main reason for the lower gross margin level of 32.4% compared to previous year's 33.1%. In groceries, the gross margin is clearly lower compared to non-groceries.

No sales growth, lower gross margin and rising operating expenses ended up with clearly lower result, minus EUR 500,000 compared to last year's, well, record high EUR 6.8 million. This was obviously a disappointment for us. The cash flow from the operating activities amounted to -- or it was negative of EUR 65 million. The inventory level is the main reason for this.

And basically, the high inventory level, basically the biggest reason is the problems from -- actually from last year in the supply chain when it comes to the factory's production capacity and the shipping arrangements. And that's why we've been forced to basically order and bring all the spring/summer season goods to Finland 2 to 4 months earlier than ever before. So we have like basically full -- all the warehouses are very full at the moment. On the other hand, we're ready for the spring season, but still this is a very difficult situation for us. But luckily, the situation will ease up during this year. Earnings per share was minus EUR 0.04.

Some of the key points during the first quarter. Like-for-like customer visits in stores down by 4.1%, which is like a little bit strange situation for Tokmanni as we're quite used to growing figures with customer visits. But as mentioned, the shocks were, according to our analysis, quite strong for our customers. And this is what our customers also say when we are doing customer surveys. The like-for-like average basket grew by 1.5%. The average basket is on a good level since the previous year's growth was 4.3%. As mentioned, sales of groceries, basically all product groups grew clearly, and the non-groceries, actually all of them -- all the product groups were declining and the sales were declining.

Tokmanni online sales increased almost 30% is very good. But as for Tokmanni's [ sales ] for the online, the first quarter is basically the smallest quarter of Tokmanni business. And online share of the total sales was -- during the first quarter, it was only 1.7%, but it's growing, which is very good. The inventory increased due to securing flow of goods, expansion of the assortment and higher purchasing prices. Obviously, the higher purchasing prices have actually quite strong effect on the inventory level or, yes, the value of inventory. But also, the main reason for this is that we just had to make sure that we -- basically we ordered everything, all the spring/summer products already 12 months ago. And we also got goods to Finland much earlier than ever before.

And now, according to basically our office, for example, in Shanghai, there is a lot of production capacity available due to less demand in the global market. So for example, for next year season, we are able to move towards normal supply chain rhythm, which means that like we are able to basically go back to the previous standard with ordering timings and so on. This will obviously make our inventory level much healthier in future.

The construction of the new warehouse, right here very close to us at the moment, that has started as planned, which is very good. Miny lifestyle brand was also launched successfully in the end of February. And Tokmanni Klubi, our loyalty -- customer loyalty program has already 1.1 million customers. This is very, very good and very promising development for Tokmanni.

A couple of things regarding the retail environment for Tokmanni in Finland. First of all, the consumer confidence is remarkably down during the beginning of the year, and it looks as if it will continue like this as well. And the purchasing power has weakened due to the rising inflation. Obviously there is uncertainty in our customers' minds regarding the future. Customers are cautious with their shopping behavior and so on, and we have to take this into consideration.

The buying prices and domestic transportation costs, basically all operating expenses have risen significantly. But on the other hand, the employment rate in Finland is at a high level, which is very good. The spring season, we are better prepared to the spring season than ever before because basically we have all the spring and summer seasonal products already in Finland, almost already in our stores basically. So we're ready to start. Unfortunately, weather-wise, the start this year will be -- it is 2 to 3 weeks delayed.

We believe that low prices and discount retailers will be having more and more important role for consumers in Finland during this year due to all these reasons mentioned regarding consumer confidence and buying power. These are the times when the discounters usually manage pretty well. So we believe in that as well.

But as mentioned already, in the end of last year, there will be fight for the market shares in Finland. And here is the figure regarding Tokmanni's and Tokmanni's competitors' market development. As you can see from the beginning of the pandemic first quarter 2020, Tokmanni has been winning market share quite a lot. But the competition really started last year and, well, I'm pretty sure it will also continue from here. Luckily enough, during the first quarter, we have been winning market share again, which is extremely important and actually our target as well.

So here were the key points, and then we go to the key figures. Markku, Please go ahead.

[Markku Pirskanen, executive]

Okay. Thank you, Mika. So let's go through the figures a little bit more deeper and starting with familiar graphs basically. I have taken 4 years' development here, so that it is a little bit better to analyze longer term here because we have had this corona time. And going over this corona time perhaps tells us a little bit better how the business has developed. And here, as I said, you see the 4 years' development.

Starting about the revenue. As already mentioned, revenue grew only 0.6% as a total. The good thing was that we gained market share during the Q1 2022. When we look for like-for-like revenue, it decreased 2.7%. But at the same time, we have to remember that last year, we have a very good growth, 12.7% when we are looking at our like-for-like revenue. Interesting thing is that when we are looking our sales mix, we were selling more groceries, clearly when -- whereas the sales of non-groceries declined. And I think so that this is clearly telling us about the consumers' purchasing power and the decreasing consumer confidence. People are basically buying more products what they are needing daily and perhaps leaving for the future the non-grocery products.

About the comparable gross profit and then the gross margin, which is, of course, very important for us. We reached 32.4% during Q1 now compared to last year's 33.1%. And why it is declining? Mainly -- or basically 2 main reasons. The product mix, which I already mentioned, we were selling more groceries. And as everyone knows, they have a lower margin compared to the non-grocery products. The other thing is, of course, that we are aiming to keep our low price limits clearly, and we are normally the last ones which are increasing our prices.

When we are looking on this 4 years' development here, we are seeing that this 32.4% was even higher compared to 2019 and 2020. But at the same time, I have to say that -- and as we have already communicated earlier, but according to strategy, we are clearly targeting to improve our gross margin. So that was not according our target.

The other thing which is affecting to our margin level is how much we are selling product labels managed by Tokmanni, meaning private labels, and also the direct import. And due to this product mix, we are seeing here that our private labels were decreasing down to 28.4% compared to last year's 29.6%. And as said, the main reason for that is the product mix because in certain product areas, we have a higher share of private labels. And now when we sold more grocery stuff, the share of private labels in these product groups are on a lower level.

And the direct import, as I have already earlier also said that they are in relation to how much we are selling private labels because we are able to better control from where we are purchasing and how we are purchasing when we are purchasing private labels compared to the brand products. So the direct import also decreased compared to last year level.

Jumping next to operating expenses. And as a whole, the ratio was 25.2% compared to last year's 23.2%. And there are a couple of clear reasons behind that one. Of course, when we are taking the personnel expenses, which is the biggest part of our OpEx, the personnel expenses ratio increased up to 14.5% against last year's 13.6%. And reason behind that was that our personnel expenses were on a higher level due to the volume of sick leaves, and that was due to the corona virus pandemic.

The other thing which increased our euro-wise expenses is the expansion of our store network. When we are looking how many stores we have at the end of Q1, we have 197. And last year, we had, at the same time, 192 stores. And it is clear that it will bring more euro-wise expenses. But at the same time, I have to, of course, say that when we are increasing our store network, we should get more revenue. So that relative expense ratio should be at least on the same level or even better. So now we didn't succeed on that.

And the third thing, which is effective to operating expenses was the common inflation. Almost all cost items were increasing euro-wise. And one example has been taken here. Property expenses are a big cost item for us, and especially high energy prices and also the general cost inflation affected our property expenses.

Comparable EBIT, it's a natural end result from gross margin and operating expenses. And of course, the revenue level ending up during Q1 2022 minus EUR 0.5 million compared to last year's EUR 6.8 million. So we were clearly behind on last year's figure. At the same time, I have to say that Q1, which is from a season point of view, the lowest quarter for us. It's very much depending on the revenue level. And in the low revenue, it's clear that when you have a bit lower margin and then higher expenses, it comes through very strongly.

Balance sheet, financing and cash flow, we're ending up when we are speaking about our inventory to the figure of EUR 305 million roughly compared to last year's EUR 250 million. It's on a high level. There are 3 different reasons behind on that. We took products earlier, our inventory to be sure that our shelf availability is on a high level. Other thing is that we have clearly expanded our assortment. And like to remind also that when we speak about inflation and higher purchasing prices, it clearly effects to our euro-wise inventory.

But as Mika already mentioned, it seems to be that the need for earlier purchases will not go away, but we'll be on a lower level during the year. So we should be able to improve our inventory level and inventory turnover ratios during the coming quarters. Due to higher inventory level, the cash flow was negative EUR 65 million, clearly lower compared to last year's minus EUR 22 million. But at the same time, of course, I'd like to remind you again about the seasonality that the cash flow normally is on the lowest level during Q1.

Looking at interest-bearing debt, the total EUR 419 million compared to last year's EUR 393 million, so a bit higher level, but at the same time, looking at what are so-called real debt, we had EUR 125 million on that item. Other dips are these lease liabilities, which are coming due to the IFRS 16, which we are reporting or using as a standard when we are reporting. The ratio of net debt to comparable EBITDA was still on a quite good level, 2.4. When we are looking what is our target in our strategy, which is 3.2. So we were clearly on a lower level when we are looking that figure.

And about the net capital expenditure. So basically speaking about investments totaling EUR 10.8 million, but at the same, I'd like to emphasize that this black portion in that Q1 2022 bar is our construction investment, our new warehouse and the amount EUR 7.4 million is coming from that investment. So basically this EUR 3.4 million is roughly at the same level of what we have had during the last 3 years' time. We're looking the total investments 2022, we are estimating them to be EUR 18 million to EUR 20 million, excluding the construction of a new warehouse building.

That's about the key figures. And now, I'm moving the speech to Mika. Thank you.

[Mika Rautiainen, executive]

Thank you, Markku, for your informative recap. About the year 2022, obviously with these kind of figures, we have a very clear focus for the rest of the year. First of all, as Markku already mentioned, in this kind of situation, the role of the discounters, the role of oil prices will be in a very important role for our customers in Finland at the moment. So we will take this as a competitive advantage that we have, and we will make sure that we'll -- our customers will understand the same issue.

Basically, we will focus on sales growth. Even in this situation, we will focus on the sales growth. It's going to be the best assortment and the low prices. Also, the Tokmanni Klubi, the loyalty program, it will give us an opportunity to reach our customers with personalized offers and things like this, which will, of course, we feel that we'll have a very good chance of improving our sales growth with Tokmanni Klubi.

When it comes to the gross margin, obviously we're happy about the sales growth with the groceries product groups, but now it's starting to win market share with non-grocery product groups. We have a very good price level at the moment with non-grocery product groups in Finland, but we're definitely going to invest in marketing for non-food products.

Short-term action points will obviously take to improve Tokmanni's profitability. Basically, in our strategy, we're basically -- we were talking about, what we mentioned, the large-scale Tokmanni stores, 10 to 12 of them in Finland. However, at the moment, the construction costs are on a very, very high level. So we'll probably take a time out regarding the large scale stores and see what's happening in the construction market, and we will focus on the profitability -- short-term profitability issues. And as already mentioned several times, also normalizing the inventory level by the end of this year. So it's very clear focus for Tokmanni for the rest of the year. It's going to be sales growth. It's going to be better gross margin. It's going to be cost control and a lower inventory level.

When it comes to the outlook for 2022, we expect the revenue to be at the previous year's level. Obviously, the target is still to grow the business, but I have to say that the shocks for our customers were unexpected and stronger than we expected. So we have to take this into consideration with our outlook. And comparable EBIT in euros is expected to be from EUR 90 million to EUR 110 million in 2022. Obviously, there are these -- all these elements of uncertainty.

But at the moment, this is our outlook for this year.

[Markku Pirskanen, executive]

So thank you very much. And now, it's time for questions. Please, operator, go ahead. Join me to answer the questions. Thank you.

[Operator]

[Operator Instructions] We already have one question coming from Nicklas Skogman from Handelsbanken.

[Nicklas Skogman, analyst]

So if we start with the new guidance, if I look at the midpoint, which is EUR 100 million, and then given the result in Q1, it would require you to deliver the same or actually slightly better earnings for the remainder of the year as compared to what you did last year. And then, thinking about with the background of your comments on consumer purchasing power, higher input cost inflation level. So with that in mind, I'm keen to hear your thinking around the new earnings guidance and how you arrive there.

[Mika Rautiainen, executive]

Well, Markku, please you can also join this. But I would say that, obviously from last year, there are some weaker points and soft results in -- well, in some areas where we can see -- we can clearly see that there is room for improvement. And for example, if you look at the quarters from last year, we were not successful -- not that successful with the fourth quarter results. Also during the third quarter, it wasn't that successful. So there are basically, we know exactly like where do we have room to improve our operations from last year. However, we definitely need to take this consumer behavior to consideration.

I would say that the way we analyze the situation in Finland is that the pandemic will start going down. The effects on the pandemic, at least for the spring/summer season, obviously nobody knows what's going to happen during the coming fall. But still, we feel that the pandemic is not such a big issue. And the pandemic still caused us losses in customer visits.

Another issue is this -- let's say, you can probably understand what I mean when I say that there is an anxiety with Finnish consumers regarding the war. And that will probably go down a little bit as well because it cannot continue that long. Obviously we don't know what's going to happen with the war. But still, the first shock was pretty strong. And now, we can see that it's kind of going down a bit. But obviously, one of the biggest issues is the inflation. And there, we feel that we haven't seen the highest inflation rate yet, and that will probably cause some problems. But there, we feel that a discounter definitely can be on a very strong position.

Markku, would you like to add anything -- or Nicklas, was it an answer to your question?

[Nicklas Skogman, analyst]

Yes, yes. I kind of see how you're reasoning there, but it also means it's pretty dependent on Q3 and Q4 that you're doing better sort of operationally this year compared to last it seems. Can I ask then, given that you didn't -- you haven't even mentioned the shift in Easter to Q2 mostly this year, and so I was wondering if you would share with us how you are sort of performing year-to-date sales wise given that Easter tends to have a positive effect on sales?

[Mika Rautiainen, executive]

Well, for Tokmanni, it's -- obviously the timing of Easter has a, well, big role, but it's even more. It's the start of the spring season. It's -- the best possible combination we could have is the start of the spring season and Easter together. Unfortunately it didn't happen this year. We are delayed 2 to 3 weeks from last year when it comes to the start of the spring season.

I don't know weather wise how situation is in Stockholm, but over here in Finland, it was -- this morning, it's still the southern part of Finland and it was minus 2. So we still -- obviously the snow well is melting away, but still it's not really the start of the season yet. It's a very crucial point, the start of the spring season. It will always come. It will come a little bit later or earlier. The best possible combination is when it joins Easter, but this year it didn't happen. But we're quite confident on that. Last year, we still had some issues regarding the supply chain and the products, seasonal products coming in this year, we're all set. So it's only some sunshine and warmer weather.

[Nicklas Skogman, analyst]

And then, on the high inventory level. And if you combine that with maybe a bit softer demand, do you see a risk of markdowns later on this year?

[Mika Rautiainen, executive]

No. No, we are not expecting actually markdowns. We try to -- or we have everything set for a very good spring summer season. But it's -- when it comes to the inventory level, it's really a strange situation that we could actually see already coming a year ago because we had to place the order so early. And also, like we had to reserve the shipments of the products so early. So we have a bit of a situation over here. Usually we would have like shipments coming in April, May, even June. But now, we have basically everything in Finland at the moment. So we will definitely do our everything to have a very successful spring season. And I don't know, we don't really see -- let's say, the inventory level is on a very high level, and that is a problem for us. But we can see that the situation in normalizing. But anyway, we would have been ordering these products to Finland anyway, but now they all came at the same time.

[Markku Pirskanen, executive]

I just add to be, we always are more careful or not careful, but thinking a bit more from an accounting point of view. And it's clear when we are on a high level of inventory, if it would happen so that we were not -- or will not be successful on sales. That's, of course, always a risk for that markup, what you ask it. But when we are looking at what kind of products we have now in our inventory, speaking about especially spring season, we have products which will not go or will not be spoiled. And that's good, except perhaps when we are speaking about the flowers. But otherwise, these products are still sale. We have capable to sell them in the future always when we speak about the risks.

[Mika Rautiainen, executive]

It's outdoor furniture, which is good, barbecues, swimming pools, things like this. So if the season -- if there won't be any spring, then -- yes, then we have to sell these products next year. But we believe in the spring season.

[Nicklas Skogman, analyst]

And then, my last question would be on -- you mentioned the different product mix with more groceries. And so if we compare to last year what people haven't bought this year, does that tend to be more of these slightly higher ticket items, which would then be explained by weaker consumer confidence?

[Markku Pirskanen, executive]

Higher ticket items.

[Mika Rautiainen, executive]

Yes, but we are not selling higher tickets. But perhaps if I understood your question right, our -- yes, that's good question, but I would not say -- or at least I don't know, but that's the situation, meaning that the higher priced products were not selling, if I understood right your question.

[Nicklas Skogman, analyst]

Yes. I was wondering, the slightly more higher priced product, if that's where you've seen the biggest drop compared to last year now in Q1 and so far this year?

[Mika Rautiainen, executive]

Yes. In a way, now if you think about the cautiousness of our customers, obviously people are concentrating on products that they need daily. And when it comes to bigger investments like -- well, especially with -- well, during the first quarter, it was like regarding the winter products. Obviously we could see their cautiousness of our customers like, okay, we're a situation of high inflation and a little bit anxiety and things like this. So let's not make big investments regarding high-ticket products as you call them. But we are basically seeing that when it comes to, for example, outdoor furniture, obviously that's higher ticket -- or high ticket products. First of all, our price level is excellent in Finland compared to some other retailers. We have a new assortment over there. It's about winning market share. We need to make the deal instead of somebody else. Probably there will be like less business in some areas, but we just need to take market share with these areas.

[Operator]

We have another question coming from Markus Heiberg, Kepler Cheuvreux.

[Markus Heiberg, analyst]

So first -- so I have a couple of questions, I'll take them one at a time. But the first question I have is on the revenue growth and consumer behavior throughout the quarter. Can you elaborate a bit on how the traffic levels develop in, say, from January until April because the total visits you state are down some 4%. Is that representative for all month or did you see some big shift in customer traffic? That's my first question.

[Mika Rautiainen, executive]

Yes. Well, first of all, it's -- let's start with the pandemic. There were a couple of really high peaks with pandemic during the beginning of the year, and we could always see that we're basically on a daily basis that there are less customer visits when the peak weeks were on. So that was clearly one issue. Then obviously, we can see that customers have less money because, like if the payday is the last day of the month, then the last week, for example, like this week, would usually be a week with a little bit less traffic due to the fact that the payday is coming on Friday, only on Friday. So like by the end of the month, people will have a little bit less money because they've had to use their money to higher energy costs, fuel costs, food costs. So this is something that we can pretty easily reflect with our customer -- daily customer visits.

Now, especially in Finland or with this kind of winter, yes, the energy costs were very high. They were very high for Tokmanni stores to keep them warm, but also for our customers. And obviously, when the weather is getting warmer, obviously that will ease up a little bit the buying power in Finland, because like no more heating during the spring summer time. But this kind of element, then when the war started, let's say, the first week was pretty dramatic when it comes to customer visits. But after that, it has been developing back to a normal level. So actually not that much of effect, but we could clearly see with the customer visits that now people were just watching TVs at home, like what's going to happen. And what's happening in Finland basically and how is Finland taking the whole situation to consideration. So we could see that with our customer visits.

So as I'm -- probably it's a little bit strong way to say that our customers had strong shocks during the first quarter. And obviously, we hope that we will get rid of this kind of shocks after the first quarter.

[Markus Heiberg, analyst]

So just to clarify that on your guidance -- or sorry, the next question is on the guidance, because you imply a negative like-for-like growth for the full year, if you look at flat total revenue growth. And then, if you try to break that into visits and basket, now the basket was up a little bit year-on-year, traffic was down. But should I expect this to shift, that traffic should pick up and basket to come down or how should we see that in the guidance? Do you expect a higher traffic level year-on-year because, of course, the pandemic, as you note, had a negative impact on traffic. So I'm just trying to understand this because if the basket is holding up and traffic is picking up due to reversal of COVID effects, then you should have a growth. So just trying to think a bit out loud here, how do you think about that?

[Mika Rautiainen, executive]

No problem, Markus. Actually we are also trying to figure out like how it's going to be because, obviously, it's been like unexpected situations during the first quarter. But obviously we will do our utmost to get the customer visits, the traffic back to normal. And we're like investing in marketing actions and so on to come back to the normal situation. And we do see pandemic not that much of effect anymore. Hopefully, the war will be a little bit behind also. Hopefully, like I said, the spring summer time will ease up a little bit inflation situation, but it's extremely difficult to see how the customers' minds will work. But let's say that we have been down with the customer visits. This is definitely one area where we want to be back on track, so to speak.

And then, the average basket, that's very difficult question because it's all about inflation. As I said, the energy is probably -- the problems with energy prices are a little bit down due to the heating, less heating costs. But we don't know exactly like what will be the final inflation rate in Finland. As you know, probably compared to Europe, we're a little bit on a lower level, but it's a little bit like what will happen over there. So...

[Markku Pirskanen, executive]

I can perhaps add some drivers concerning this basket size, it's an interesting question because basically we have 2 different drivers where we have certainly which is affecting these consumers or customers' purchasing power, which might lead to the situation. But the basket will be on a lower level in the future because we are buying less than earlier because they don't have money.

On the other hand, we are, of course, seeing this inflation weaker figure, which is leaning on the direction on higher basket size. So we have basically 2 drivers where -- which is affecting. And of course, the third drivers are our own actions to try to get the higher basket size. So basically 3 different items. And that's why it's a bit difficult to say exactly how it is going to happen.

[Markus Heiberg, analyst]

Just to sum up then. If we break down the like-for-like that you sort of implied down a little bit with flat revenues, do you expect that to be mainly the basket or mainly visits?

[Mika Rautiainen, executive]

Let's say that we're basically taking as a cautious guidance due to the experiences during the first quarter. So it's -- we're not actually giving direct guidance, whether it's like traffic or whether it's basket, but as a combination. Sorry to not give you a clear answer on that, but I'm sure that you understand why not.

[Markus Heiberg, analyst]

Yes. It's, of course, very, very difficult. And my last question here is on the gross margin that is down 120 basis points year-on-year. So is it possible to say anything about how much is related to mix and how much is impacted by freight costs and how we should think about both mix and freight costs going into the next quarters?

[Markku Pirskanen, executive]

So we're not splitting it exactly, but it's clear that I would say that the mix has a bigger effect compared to price costs, but both have an effect. And the third effect is, of course, is as we said that we are trying to keep a low price image. But certainly, this mix has a quite big effect. And how it is going in the next coming quarters? As Mika said that we are targeting to increase our market share in non-grocery products, which should -- or if that happens, it leads, of course, on a higher margin. Freight costs will continue on that -- roughly on the same level, that's clear. So that's the drivers, again, how it goes. I can't give you an exact answer to that one.

And of course, the third thing what I mentioned was this how we are handling our price increases. We are following our competitors and seeing how the markets react and clearly target to have a low price level in Finland.

[Markus Heiberg, analyst]

But you are focusing on sort of the non-food grocery because is it fair to say that there are discounters within the food sector that have a better price position in Finland, and it's mainly in the non-grocery area that you have the strongest price position? Or is it a combination?

[Mika Rautiainen, executive]

Now if you look at the sales figures regarding the retailers in Finland, actually Tokmanni has been performing pretty well with groceries actually. And as already mentioned that the grocery product groups were growing during the first quarter, so yes -- well, first of all, during the first quarter, we could see that people are buying only grocery because that's -- you need that every day. But obviously, we try to win our market share with non-food products with non-groceries. Depending on the situation, actually even if it's with lower gross margin, the grocery still supports the total picture of Tokmanni because in a difficult situation, people will always need groceries, and we have a very good price level. So there's, let's say, a very important support from groceries, but obviously, we would like to sell more non-groceries. So it's a really interesting combination where we are balancing at the moment.

[Operator]

[Operator Instructions] And it seems that we have no further questions.

[Mika Rautiainen, executive]

Thank you very much. Wishing us all sunny and especially warm spring days. Thank you very much.

[Markku Pirskanen, executive]

Thank you.