Tokmanni Group Oyj

OMXH:TOKMAN

Earnings Call Transcript 2022-Q2

[Mika Rautiainen, executive]

Good morning, and welcome to Tokmanni's Second Quarter 2022 Results Presentation. My name is Mika Rautiainen and together with Tokmanni CFO, Mr. Markku Pirskanen will present the key points and the key results of the second quarter and the first half of 2022.

Tokmanni's revenue during the second quarter was basically at the previous year's level. EBIT was clearly lower mainly due to the cost increases. I've been working for more than 30 years in retail, and according to my experience I haven't ever seen this kind of second quarter before where basically inflation, pandemic, the atmosphere from the war and mainly the nonexistence spring/summer season is -- was affecting both customers and retailers.

Let's take a look at the figures a little bit more careful like how did this -- all of this effect in Tokmanni. The revenue grew by 1.7%. It was basically approximately EUR 5 million more compared to the previous year, EUR 306.7 million. Like-for-like revenue decreased by 1.5%. Gross profit was basically on the same level, EUR 1 million more compared to the previous year. And gross margin, 34.8% was slightly lower compared to the previous year.

Comparable EBIT amounted to EUR 27 million compared to previous year's EUR 32.3 million, clearly lower EBIT. However, 8.8% of revenue, which is quite good level for retailer. Cash flow from operating activities was EUR 62.8 million compared to EUR 61.5 million during previous year and earnings per share, EUR 0.35.

Some highlights or, let's say, key points regarding the second quarter. First of all, there is a clear change in customer behavior in Finland. First of all, customers are more cautious with their purchasing decisions. This is very understandable and the natural, well, inflation, energy prices, fuel prices, food prices and now even the interest levels are going higher. So basically, people are becoming a lot more cautious with their purchasing decisions, which is pretty natural.

During the second quarter, Tokmanni's sales was basically more towards groceries. Actually, it was -- it's a good product mix for Tokmanni in total so that if we lose due to the season, which is not there, if we lose sales, there is always these grocery departments, which are attracting our customers.

Tokmanni's online sales decreased by 4.8%. According to our customer surveys, basically customers are saying that they're happy after pandemic. They're happy visiting our stores. There will be a slight drop with Tokmanni online business due to this fact. But we see that online business will be also increasing, growing in coming months. Basically due to the fact that we are offering wider assortment through the online channel.

Like-for-like customer visits decreased by 2.6%. This is mainly due to the fact that the spring/summer season began only in mid of June in Finland. Average basket increased by 1.1%.

We launched a new Miny product group in the end of -- or during the first quarter. The target was to attract new customers, young female customers. And we were very happy to see that this was also happening in the stores where Miny department is at the moment. So we will also continue with Miny later on. I'll come back to that a little bit later.

One of the definite highlights is with our loyalty program, Tokmanni Club, Tokmanni Klubi. The program has now already 1.3 million members, which is actually exceeding our target for this moment. So we're very happy about this because it gives us a lot of opportunities, for example, personalized offers and customer data as well.

So as mentioned already, the spring/summer season in Finland started very late, basically in the middle of June, and it affected sales, profit and especially inventory level.

The Tokmanni's inventory value increased significantly. And that, of course, is something where we need to be extremely careful when it comes to the focus for 2022 the second half. Some positive things also is that we are planning to start using the new warehouse in 1 years' time, basically by next summer and the construction work with the new warehouse is progressing as planned. This is, of course, one of the key points when it comes to the Tokmanni supply chain efficiency. So we're very happy about this progress.

And then let's take a look at the first half figures. Revenue grew by 1.2%. It's been a very difficult first half of the year for Tokmanni. Obviously, it's -- there are strong figures from previous years, 8.8% growth. And even with the like-for-like growth, 7.8%, but still it was pretty difficult. Based on that, we -- in Tokmanni, we think that we did okay when it comes to the revenue development. But yes, obviously, it was like as mentioned, it was a little bit difficult.

Gross profit was basically on the same level in euros compared to the previous year. And the gross margin, 33.8%, slightly lower compared to last year. Obviously, we have been holding on with this discounter, the price image -- one of the best price images in Finland and keeping the price level for our customers as the lowest in Finland. And of course, it has its price, and you can see that in our gross margin level.

However, we think that this -- even if it's been an investment, we think that it's -- it will be benefiting us when it comes to the, for example, second half of this year. Comparable EBIT was EUR 26.5 million, clearly lower compared to last year EUR 39.1 million. And basically, the EBIT level was 5% compared to the 7.4%, which basically shows that it's been slightly difficult the first half of the year.

Cash flow from operating activities was minus EUR 2.3 million compared to previous year's EUR 39.5 million. And this is basically due to the increased inventory level and of course, lower EBIT level. Earnings per share, EUR 0.32 compared to previous year's EUR 0.48.

If we then look at the market development, the red curve is Tokmanni and the black one, all competitors. As you can see here, it's a tough competition. It's very difficult to win market share at the moment.

We've been trying to analyze this quite a lot, and we feel that the winning of the -- a clear, very strong winning of the market share during the 2020, as you can see from the figures, is now something where we really need to fight harder to continue the -- winning the market share. But it's -- as you can see, it hasn't been that easy. But we feel that it's quite a lot due to the strong success during the 2020.

And next, it's Markku, please. Markku will be presenting the key figures, a little bit closely.

[Markku Pirskanen, executive]

Yes. Thank you, Mika. And good morning from my side also to everyone. And let's look figures, as Mika already mentioned a little bit deeper. And I'll take some graphs also, which hopefully clarifies a bit more the figures.

So let's start about the revenue, and here, we have -- as we had also already during Q1 4 years' development. And why I have taken the 4 years development, this 2019 is perhaps some kind of basic year before the corona started and 2021 we had a corona time, and 2022 we had, had many different kind of other issues which have affected the operating environment.

On the left-hand side, these 4 bars are quarter based and these 4 on the right-hand sided are half year's figures on these graphs. So starting Q2 2022, the revenue was about the level of '21. Total revenue grew by 1.7% and like-for-like revenue decreased by 1.5%. And it's clear that the operating environment was very, very challenging.

Inflation basically started already at the end of '21, and we can even say that it has accelerated during the first half of 2022. And that, of course, has affected very much to customer confidence, which is on very low level in Finland at this moment.

The other thing which affected to our revenue was the late spring and summer season. It was very exceptional timing for starting spring and summer season this year.

Looking what kind of products have sold. Well, we can say that home decoration, groceries, cosmetics and apparel sales has increased. And if we look a little bit these product groups, groceries, it's proportional from our mix is now on a higher level as it was also during Q1.

This is perhaps reflecting the customers' way to think that we really need -- or they are really buying products, which we are really needing. And perhaps the non-grocery is not first in the in their mind.

Cosmetics and apparel, corona has not over, but it has been on lower level now during Q2 and people has started to move around more. And perhaps this has pushed the cosmetics and apparel sales during Q2 2022. During Q2 product groups, which sold very -- sold on a lower level was garden soil and fertilizer plants and also outdoor activities. And the selling of these product groups are quite clearly in relation to what kind of weather we have had during Q2 and the volume was not too good, so these product groups were suffering.

When we look at these 4 years' time period here, how the revenue has developed, we can calculate but average yearly increase has been roughly 6%, which is perhaps quite okay development during these 4 years' time. Of course, the jump during '20 and '21 was very high due to corona pandemic. And if we look at the development during the first half of this year, it has been quite similar compared to Q2 2022. And also this 4-year period is about the same kind of development when we look at total numbers.

Next, a couple of words about the comparable gross profit and margin. Q2 2022, 34.8% compared to last year's 35.1%, so small decrease there. But when we are looking for euros, we add this profit. What was affecting to our gross profit and margin? It is clear that the sales mix, more groceries, it has an effect to that one domestic freight costs.

Gasoline prices has increased in Finland clearly, as it has done, I guess all places in Europe. But of course, affected the freight cost during Q2 here in Finland. And one other thing, which Mika already mentioned was our aim to ensure the lowest price level in the market, it has clearly affect our gross margin level.

Next, the product labels managed by Tokmanni, which means mostly private labels and also direct import. Our target is to increase the share of private labels when we look a little bit longer run. But now you can see that during Q2 2022, and also when we look at the half year figures, the private label's share was decreasing. During Q2, the share was 31.9% compared to last year's 33.1%. And same kind of development as said during the first half '22. Direct import, we achieved about the same level compared to Q2 2021.

Operating expenses, that is a big challenge at this moment. As I mentioned already, inflation, it has affected to almost all expenses what we have. Looking our proportion of operating expenses against the revenue during Q2 2022, it was 20.5% compared to the last year's 19.2%. So quite significant increase there.

And if we compare to the 2020 figures it was 18.5%, still bigger difference. But we have to remember by 2020, the revenue started to increase very rapidly and the cost was following a little bit later on, and that's why this Q2 2020 figure is so low.

And looking about 2019 level, it is -- it was 21.5%. So now we are a bit lower level at this moment. So what kind of cost items was affected or was increased mostly? We can name 3, salaries, real estate and marketing. Salary rises, according the collective agreement and also still during the Q2, the amount of sick leaves were on a higher level compared to last year.

Real estate costs, the general cost inflation affected were, but also that we had more stores compared to Q2 2021. Marketing costs, there are some surprising element where. This paper costs and paper prices -- the paper prices increased during Q2 strongly, which affected to our marketing expenses. But also, we made some more activities if we compare Q2 now this year compared to last year, and our activities was mainly in relation to our Tokmanni Club marketing activities.

Comparable EBIT, it's -- of course, the end result when we thinking revenue, gross profit and expenses and also adding the depreciations there. Comparable EBIT Q2 2022 at a level of EUR 27 million compared to last year's EUR 32.7, so sorry, EUR 32.3 million. So a clear drop by EUR 5.3 million. And the main reason for that is increasing, operating expenses, but also increasing the depreciations.

And we have to remember that our rental costs are calculated as a depreciation due to the IFRS 16 standard. And when we have more rental costs, it is shown in our depreciations. But at the same time, I have to say that also the so-called basic depreciations were increased due to the reason that we have invested during the last couple of years, a bit more compared to the so-called normal investments.

Next, looking and transferring to the balance sheet, financing and cash flow part and the dominant issue here is clearly the inventory, which Mika already mentioned. At the end of June, we've had a level of almost EUR 340 million compared to last year's EUR 253 million, so very big difference between these 2 figures. And there are 3 different main reasons behind all that.

The higher purchase prices, late start of the season and also we have targeted to have a better shelf availability. And also, we have some new stores, as I already mentioned. So these reasons are behind of that increase on about inventories -- inventory increase. And it's clear that we have to make the actions to decrease the inventory level because we can say that at this moment they are on higher -- too high level on that.

Cash flow, minus EUR 2.3 million compared to last year's EUR 39.5 million. And the reason behind of that lower cash flow is clearly increasing inventories or higher level of inventory amount, but also the lower result what we achieved during the first half of 2022.

Interest-bearing debt, now we are at a level of EUR 448 million compared to last year's EUR 384 million. And if you look what we have here in our debts, it's EUR 100 million so-called noncurrent corporate points. And we have taken this noncurrent -- sorry, we have taken current corporate points now during Q2, and we have EUR 55 million here when we -- last year, we didn't have these kind of bonds and loans. And the rest of dips are so-called liabilities, which are based on leases coming through IFRS 16.

Even the interest-bearing debt has increased, we can say that we are still in a good position when we are looking at the ratio of net debt to comparable EBITDA. It was 2.6, which is higher compared to last year's 2.0. But at the same time, we have to remember that we have set the long-term target, which is EUR under 3.2, and we are clearly now under that target.

Net capital expenditure, meaning the investments, looking 6 months period, January through June, we were at a level of EUR 22.4 million, which is clearly more compared to last year's EUR 5.9 million, but the main explanation there is our new construction work for new warehouse, which part was EUR 12.8 million out of which EUR 22.4 million.

The other investments was normal store investments for store network and also renovating stores. And also at the same time, we like to invest to develop our digital services.

When we are looking what kind of investment we are expecting during this year, it's still at the level of EUR 18 million to EUR 20 million. And that amount is not including the construction of a new warehouse. And comparing the last year figure, it was EUR 21.7 million, but you have to remember that it also included the acquisition of TEX stores.

So that's about the figures at this time, and I'll still transfer the speech to Mika. Please, Mika. Go ahead. Thanks.

[Mika Rautiainen, executive]

Thank you very much, Markku. Yes. Obviously, Tokmanni strategy is guiding basically all operations and activities of Tokmanni. But in this situation in this retail environment, obviously, our full focus is in 2022, basically the second half of 2022. And the focus is especially on sales, inventory and costs.

First of all, as mentioned already, customers are more cautious with their purchasing decisions. Actually, customers, they need to do savings, they need to save money for the higher fuel energy costs and things like this. So obviously, low prices are emphasized in customers' purchasing behavior and that's, of course, very good for Tokmanni, which is the biggest discounter in Finland.

And we are doing that, we are offering basically our customers and, of course, targeting at the same time for sales growth by low prices, attractive assortment, targeted marketing with the help of Tokmanni Club and excellent service. But low prices will be in customers' focus in Finland for sure. And that's -- we feel that, that will be a competitive advantage for us.

Obviously, we'll continue with expanding the store network actually in 1 months' time. There will be the next new store opening in Nurmijarvi, somebody is interesting in the location. And of course, the Miny lifestyle concept will be expanded. We will probably have more than 20 or approximately 20 stores with Miny lifestyle concept by the end of this year.

And obviously, as mentioned already several times by myself and Markku we'll focus on the inventory level. And actually, all the actions to optimize the level are already in place.

And after a couple of years with a very problematic supply chain, it now seems a time where we can basically start building a better efficiency and cost control with the supply chain and our stores. And that's, of course, to improve the profitability. But at the moment, we can see that if I take an example, for example, from outdoor furniture, where basically to -- first of all, to get any shipments to Finland this year, we had to place the orders in May last year, actually, even before the season start.

Now it's actually a situation where we can basically decide on the orders in August, even late August, which basically means in Finland that the season is practically already gone. So it -- of course, it helps and it gives us the sign also that the supply chain is, in a way, getting more normal. And that's, of course, always a situation where basically we can start building the higher efficiency in our supply chain.

But with all these changes when it comes to customers, the retail environment, of course, fast reactions and flexibility are extremely important. And we feel that Tokmanni is in a very good position to act fast and be flexible regarding the market changes. So this all will be in focus for the second half of 2020, sorry, 2022. And the outlook is basically the same. So we expect revenue for 2022 to be at the previous year's level and comparable EBIT in years, we expect to be from EUR 90 million to EUR 110 million in 2022.

So that's the key points and key results. Thank you. And actually, Markku, please join me. Thank you this time is also for Markku. This is the last time -- the last result presentation for Markku. Markku has decided to still do something else, not only CFO for Tokmanni. So obviously, I would like to thank you on behalf of everybody in Tokmanni for basically a fantastic job you've done.

Markku also, I don't know whether it's a record in Finland, but Markku has more than 100 quarterly result presentations in stock exchange companies the last 5 years, a bit more than 5 years in Tokmanni. So that's really great.

And thank you very much for your professionalism and also as a friend. Thank you very much.

[Markku Pirskanen, executive]

Okay. Thank you very much.

[Mika Rautiainen, executive]

And all the best for you.

[Markku Pirskanen, executive]

Okay. Thank you very much.

[Mika Rautiainen, executive]

And by the way, during the Finish session, we already gave Markku some flowers. So on the name of a cost control of Tokmanni, it's only one bouquet.

[Markku Pirskanen, executive]

Yes, that's good. So, let's go to the question.

[Mika Rautiainen, executive]

Yes, let's move to the questions. Okay. Operator, now it's time for questions.

[Operator]

[Operator Instructions] And our first question comes from the line of Nicklas Skogman from Handelsbanken.

[Nicklas Skogman, analyst]

I have a couple of questions, please. The first one is on the gross margin. It is only down 25 basis points year-on-year, and that is despite what you said about the negative mix effect from grocery sales.

And as far as I can see, private label sales are also lower compared to last year. And then you mentioned freight cost as well. And then you also mentioned that you've been sort of holding back price increases. For me, I would have thought the gross margin would be down by a lot more if you factor in all of those items.

So I guess the question is, is it really that much of a negative impact from not raising prices in the way that you basically needed to compensate for higher input costs if you factor in the negative mix and then the freight and so on?

[Mika Rautiainen, executive]

I'll start then Markku, you can continue afterwards. Yes, it's a little bit like a mixed situation. We actually -- since the late start of the season, we basically lost sales with big garden products. Maybe one of the biggest, I think, I don't know how you call it in Swedish or really what -- but for example, garden soil or dirt, whatever you call it, fertilizers, things like this.

We basically -- we are the biggest retailer for garden soil. And it's very, very low-margin products. And basically, we lost the sales. But in a way, it affected -- well, I cannot say positive, but it wasn't affecting that much our gross margin. So it was -- at the same time, for example, outdoor furniture, we were doing actually pretty well. There was like a sales increase with outdoor furniture, this kind of product, but we lost with big volume products during the second quarter regarding the garden.

But always with a big, big volume products, the prices are also extremely sensitive. And the price level is very competitive. That obviously had a basically background to this situation. But would you like to add something, Markku?

[Markku Pirskanen, executive]

Yes. And it's -- as you said, it's clear that the drop was not too big. But we are following what is the competition situation in Finland. And I'm looking what the competitors are doing. And as we said -- as said also earlier, we are targeting to be on lower level when we are comparing to our competitors. And of course, it means that the prices has increased. But at the same time, we have taken care that the prices are under the competitor's level.

And of course, to be honest that when we are -- other costs are also increasing, you should be able to increase even more. So when we -- when you are losing your gross margin in this kind of situation, it leads easily to the situation about your EBIT decreases.

[Mika Rautiainen, executive]

Well, exactly, as Markku said, obviously, the buying prices are increasing for all retailers. And for us, it's extremely important to show the lowest price level for our customers. But like when the competitors are increasing their prices. So obviously, it gives us some space for also checking the price levels. Hopefully, that answers.

[Nicklas Skogman, analyst]

Yes. No, I think I understand what you are saying. But then if we look at your guidance, which is still very wide, in H1, you -- or EBIT is basically down 32% year-on-year. And with the EBIT guidance of EUR 90 million to EUR 110 million, that implies development in H2 being either up 25% or down 5% EBIT wise. And if we assume then perhaps your OpEx will continue to grow at a pretty high pace. To me, it feels like you must be expecting a gross margin that either -- it must basically be up year-on-year in H2 for you to still have this sort of the upper part of the range in place since the midpoint implies a 10% EBIT growth in H2 year-on-year.

[Mika Rautiainen, executive]

Yes. Well, obviously, at the moment, it's so very difficult to see what will be happening in the market. And basically, for example, as you very well know, July is the summer holiday month also in Finland. People are actually coming back to work already next week. July has been a lot of traveling abroad for Fins as probably in every country after 2 years of not traveling.

So basically, already starting from next week, we will be seeing a little bit more carefully like, okay, what's happening in the market? Because like the people will be back from their holidays, not that much of traveling anymore, then we also see like how people will react with all the pressures with increasing energy, fuel, food prices and things like this. So it's a little bit early. We -- definitely, we want to see like, okay, what will be happening in August.

We obviously expect that we will be like on, let's say, on a strong side when it comes to sales as well because like the competition will be pretty hard. And we've been trying to position ourselves very clearly on the low price level, and we should be benefiting out of that during the coming months. So it all starts from there. But when it comes to the guidance in this kind of environment, it's extremely difficult to be more exact with the guidance. I don't know, Markku, would you like to add something on that?

[Markku Pirskanen, executive]

Yes, that was very, very good, good. And perhaps something what I'd like to say is perhaps when you ask it about the gross margin we certainly has had during the first half of this year, lower level of private label, for example, compared to last year. And we can assume or we can push more private labels during the second half of the year, which, of course, means that it gives us a possibility to achieve a bit higher gross margin, at least a possibility for that. And also, we have to remember that also last year, when we look at Q4, the costs already started to increase at that time. So perhaps the change compared to this year, of course, when we are looking at the end of the year is not as big as it has been during the first half of this year.

[Operator]

Our next question comes from the line of Markus Heiberg from Kepler Cheuvreux.

[Markus Heiberg, analyst]

So a couple of questions from me as well. And you started answering a bit earlier here. But on the traffic development, you see that like-for-like traffic is down about 3% year-on-year. And this is quite stable versus 2019, the way I see it. And how have you seen these metrics developed through the quarter and into Q3? And what should we expect in terms of traffic?

And then also you can touch upon the basket size, which is still at a very high level and how, sort of the number of items has developed. So if you could elaborate a bit on how you see traffic and basket develop over H2? That will be my first question.

[Mika Rautiainen, executive]

Okay. Maybe I'll start and you can continue. Yes. First of all, it's like 2 sides with when it comes to the traffic. It's 2 sides. Basically, during the second quarter -- during the second quarter, the traffic was clearly affected by the start of the season, which was really like slow, right? It started in the middle of June, and that's it.

And unfortunately, we lost quite a lot of -- from the season start, and it affected, let's say that we didn't get those -- well, in Finland, when the season starts usually in April, a lot of people come in to the stores, buying their garden soil and plants and fertilizers and things like this. And we basically lost all of that. Actually, it was in April and May then in June, it finally started, unfortunately, too late.

So obviously, when it comes to the third quarter and fourth quarter, there is no -- this kind of issue. And when it comes to the Christmas season, the Christmas season, it will be there, whether it's snow or not, but the Christmas season will be there for sure. So basically, this is the positive side when it comes to the traffic part.

Then obviously, the -- let's say, the negative side or I don't know whether it's going to be negative, but there will be like clearly more competition because people need to be cautious with their spending. And today in Finland or any day in Finland, if you open TV or radio and look at the news flash they're all the time saying that the costs will be rising. People need to be extremely careful with their spending because the interest rates are getting higher and so on.

So obviously, we Fins are like this that we -- definitely, we become more cautious if like all authorities and experts are saying that this is exactly something we need to do. So in a way, this is the downside. But on the other hand, that's the place where we'll be, well, hitting the market or targeting the market showing that, hey, listen, guys, we do have the lowest price level. If you need to save money, visit Tokmanni. But yes, let's see, I don't know exactly how this will be ending up. But yes, there are like, obviously, we target with a positive traffic during the third and fourth quarter, but we cannot say how dramatic the customer behavior will be due to the situation.

Now when it comes to the average basket, we haven't seen any major changes with the average basket like that, for example, that people would be buying only, how do you say, low-price unit products or something like this.

Actually, we had a very good sales growth also with product groups or product over 100 years price point. So we haven't seen any major changes with the average basket. The only change is due to the seasonal issues like where basically, we are selling more groceries instead of the garden products. But yes, it's going to be an interesting third and obviously fourth quarter as well. Hopefully, that was giving you some kind of idea how we see the business.

[Markus Heiberg, analyst]

That was actually very helpful and very interesting with the sort of quite unchanged customer behavior so far, if I can understand you correctly in terms of the items people are buying. And then my last question is on the inventory actions that you are mentioning. What kind of actions are these? And should we expect higher campaign level into Q3, getting rid of seasonal items, which could impact your gross margin in H2? Or is it more of a sourcing adjustment that you are making?

[Mika Rautiainen, executive]

Yes. Well, if I take one -- well, a product group, which was affecting on the inventory level by like increasing that mostly. That was, of course, garden. Now we've been following extremely carefully the buying prices, for example, for outdoor furniture products. And we made a very careful calculations regarding the buying price level at the buying prices, they haven't been coming down enough for us to basically clear the inventory for out-of-furniture or, let's say, the garden products.

So it means that -- based on our calculation, it's more beneficial to keep the garden products for the next season compared to start campaigning with, let's say, EUR -50 to EUR -70 million. We have seen -- I think that we've seen some -80% discounts in the market. And that's not for us at the moment. Obviously, we'll have some campaigns, but not like we would need to clear the inventory level totally.

So we made the calculations that we will keep the, for example, the outdoor furniture or let's say, garden products for the next season, even though it will be cost from storage and so on. But no emptying the inventory level at all.

[Markku Pirskanen, executive]

And about the actions, it's clear that when we are looking at our logistics and our sourcing, it's more normal today. We have earlier or we have had to order earlier, but we are sure that we have these products, and we have a good shelf availability. And now it seems to be that the logistics is working at least about the normal way, which means that we can postpone our orders to later stages, which should, of course, effect due to our inventory levels during the second half of the year.

[Mika Rautiainen, executive]

We've had like -- well, almost like -- well, 1.5 years, we've had quite strong buffers regarding -- to make sure that we have goods for our customers. And now it's time to clear these buffers because the supply chain seem to be very -- getting back to the normal situation.

[Operator]

[Operator Instructions] And as we have no more questions registered, I hand back to our speakers.

[Mika Rautiainen, executive]

Okay. Thank you very much, everyone. And one more time, thank you, Markku. And let's see in October with the third quarter result presentation. Thanks.

[Markku Pirskanen, executive]

Thank you.