Viaplay Group AB (publ)

STO:VPLAY B

Earnings Call Analysis

Earnings Call Transcript 2024-Q2

[Matthew Hooper, executive]

Good morning, everyone, and welcome to today's Q2 2024 results conference call. My name is Matthew Hooper, and I will be your host today.

Joining me here on the call is our CEO, Jorgen Madsen Lindemann, and as usual, our presentation will be followed by a Q&A session. We are adopting a new format for this call this morning, with shorter presentations from us, in order to provide more time for questions and discussion.

You can find our results materials, including a presentation deck, on the Investor Relations section of our website. We will not, however, follow the slides, but they do provide the usual information for you. Please be advised that today's conference call is being recorded.

If you want to ask questions and you are following the webcast, please post your messages -- or the questions on the message board at any time, and I will read them out for you. If you prefer to ask your questions directly, you are of course welcome to do so by using your phone keypad. But more about that later, when we get to the Q&A session.

I will now hand the call over to Jorgen to walk you through the Q2 highlights. So over to you, Jorgen.

[Jorgen Lindemann, executive]

Yes, thank you, Matthew, and good morning, everyone. Our results are in line with expectations, and our outlook remains the same, so we have made no changes to our forward-looking guidance. We are fully focused on making all of the operational improvements that are necessary to achieve our plans and return to profitable growth and free cash flow generation. We have made progress, but there is still much to do.

Our corporations generated 3% organic sales growth in Q2, while the losses for the corporations' preliminary reflected higher content costs due to the annual inflation built into our sports rights contract and the weakening of our SEK reporting currency against the currencies in which we buy our content.

Turning first to our largest business, Viaplay, which accounts for almost half of the group core revenues, Viaplay's sales were down 1% year-on-year on an organic basis. This reflected a decline in the core subscriber base, which was partly offset by the 11% to 27% price increases that we have introduced across almost all of our markets. These price increases resulted in 1% quarter-on-quarter organic revenue growth for Viaplay, despite the quarter-on-quarter decline in the subscriber base.

We continue to discuss with our key B2B distribution partners how we can enhance our commercial relationship, so that we can get fairly remunerated for our content. The Q2 subscriber figures also reflect the usual pattern as we enter the summer period, and the number of the international sport league seasons come to an end.

We are prioritizing value over volume in our Viaplay business and the price increases reflect the content investments that we have made and the value for money that our competitive and relevant products offer to our partners and to our consumers.

Let's move on to our second biggest business line, the B2B partner, linear channel subscription sales, which accounted for almost 30% of core group revenues. Sales were up 7% on an organic basis after the price increases that we have introduced. There is still much to be done in this area, and discussions are ongoing with our partners to ensure that we can together monetize much better on the investments that we have made.

The discussions with our partners include what we can jointly do to launch relevant new products in our market. A good example is Viaplay's Sport News, our new Sport News channel, which includes content from both Sky Sports News and Sky Sports Premier League channels in the U.K. It is being rolled out this summer, firstly in Denmark in August, and we are discussing both channel distribution deals and advertising sales deals at the moment. We will also together focus on tackling account sharing, which is a major value leakage issue for the industry and especially for high ARPU products.

As I mentioned on the Q1 call, we estimate approximately a third of the Viaplay subscribers, including 1/3 of the Viaplay Premium subscribers, have sharing their account details for their subscriptions. We have now started this summer to implement broader initiatives, which are already up and running in the Netherlands and Denmark with the other countries to follow.

Initial signs are good, but it is yet early days. We're also working with our industry peers to combat piracy. But it is very clear that we need to do much -- we need more help from the politicians and regulators to prevent and release all forms of illegal content distribution.

Our third largest sales business is advertising, which accounted for just over 20% of the group core revenues in Q2. We said last quarter that we would like to see our total ad sales return to growth, and we managed to achieve that in Q2. The 5% organic growth that we reported was well ahead of the ongoing decline in the linear TV advertising market, and this was driven by a number of factors, including Swedish linear ad sales being up year-on-year in Q2.

Our radio advertising revenues were also up in growing markets in Norway and Sweden, and our digital ad sales are continuing to grow at a rapid double-digit rate with a 31% increase in our overall digital ad inventory. This is an important transformation as we plan to replace all lost linear advertising revenue with digital ad revenue.

Two other examples of further innovation of the advertising side are the recent free TV partnership with Talpa Network in the Netherlands, where Talpa's widely available SBS9 channel was rebranded as Viaplay TV and includes selection of our vast amount of sport content hours.

And the launch this summer of a hybrid video-on-demand tier for our Viaplay subscribers in the Nordic. The new tier is competitively priced and includes advertising. The first rollout was in Denmark, and the other markets will follow.

Finally, let's look at our sub-licensing and other sales, which account for less than 5% of the group call revenues and compromise the revenues that we get from Viaplay Select, as well as the sport and non-sport sub-licensing deal we have done in our call markets as part of our self-help measures to bring down our committed cost base. Per-year number includes our studio operation that we have now closed or sold, and our sub-licensing sales were up 11% on an organic basis.

Moving now to the cost side, I would like to remind you again of the comment I made last quarter that our Nordic content costs have been growing almost twice as fast as our Nordic subscription sales, and that is clearly not sustainable. The primary reason for this is the competitive pressure on sports-wise pricing in the last few years and our over-invested in original programming. We've also had significant currency headwinds.

Looking ahead into Q3, we have the Champions League now also again in Sweden for the first time in 3 years, as well as a new season of the Danish Superliga, the Premier League, kicking off. We will be launching our Viaplay Sport News Challenge in Denmark. We have fifth skiing is back. We'll have more Formula 1 races, including world champion Max Verstappen's home Grand Prix in the Netherlands next month, and we'll premiere new seasons of proven local productions like the 'Paradise Hotel Sweden', 'Charter Fever' in Norway and ‘Expedition Robinson’ in Denmark.

Finally then, we have continued to streamline the organization by exiting the non-core markets. Poland is the only one left now. And more broadly, we continue to improve the setup and functioning of our team across the core business and ensure that we locally mandate and accountable teams with strict governance processes, but there still remains more to do in that space as well.

All of this is critical to enable us to achieve our goals of low to mid-single-digit percentage revenue growth, double-digit operating profit margins in 5 years, free cash flow generation in 2025 for our corporations, and in 2027 for the group, so that we can build our balance sheet and enable shareholder return.

So, that concludes my initial remark. So, in the absence of a CFO, Matthew has volunteered to comment on our financial performance and position. So, over to you, Matthew.

[Matthew Hooper, executive]

Thank you, Jorgen, and good morning again, everyone. I'll keep this short and focus on the key points here. So, we'll start as usual with our organic development. Our organic growth was again higher than our reported growth due to the divestment of the remaining studios' operations as well as the continued interplay of our currency mix this quarter.

FX had a negative impact of SEK 10 million on sales for our core operations, inflated our core costs by SEK 79 million, and core EBIT was therefore negatively affected by SEK 89 million in the quarter. This means that 60% of the SEK 153 million year-on-year decline in core EBIT was due to FX. The remaining SEK 64 million was a result of SEK 109 million of higher sales, SEK 143 million higher COGS, and SEK 30 million higher SG&A.

Based on current rates and our more limited ability to hedge currencies, we expect a negative transactional FX impact on full-year EBIT in the range of SEK 300 million to SEK 400 million. The H1 impact was SEK 130 million. 80% of our OpEx relates to content costs, which were up 8% in Q2 and reflected the rise in sports content costs due to the annual inflation in those agreements as well as adverse FX effects, as Jorgen mentioned.

Sports makes up 80% of our content costs, and our content costs are expected to be broadly flat in the second half of the year. Our core SG&A costs were up 7% in Q2, as we now allocate all central overhead costs to the core segment. This results in a higher SG&A cost for the core segment throughout the year, which is largely offset in H1 by the headcount reductions that were made in Q3 last year.

The increase in SG&A will be higher in Q2, as the comps include the majority of the headcount savings from last year. For the non-core markets, we actually made a small profit this quarter due to the reversal of some accrued costs and lower marketing costs.

For the rest of the year, the non-core EBIT line is basically the Polish SG&A, and there is no change to our guidance ranges for the non-core operations. We had a SEK 48 million positive IAC this quarter, which comprised a SEK 71 million gain on the sale of Viaplay U.K., SEK 76 million of costs arising from further redundancies, and SEK 53 million of positive unrealized and non-cash FX translation effects related to the previous content provisions that we have made.

Associated company income was in line with expectations, and we continue to expect our share of Allente's full year 2024 earnings to be in the range of SEK 100 million to SEK 150 million. As expected, there were no further dividend payments from Allente in Q2.

Moving on to our cash flow, our operating cash flow of SEK 614 million comprised the core EBIT losses of SEK 72 million, just under negative SEK 100 million from the combination of CapEx, interest, taxes, and adding back the depreciation and amortization charges.

A positive working capital change of SEK 794 million for the core segment, and a SEK 1 million cash flow from the non-core operations. The positive working capital change reflected the usual seasonal patterns when it comes to payments for sports and non-sports content, and we continue to expect a working capital build-up again in Q3, as usual given the timing of sports rights payments in particular.

We drew down SEK 1.5 million on the SEK 3.4 billion RCF after the end of the quarter to fund the sports payments for full due in July. Our financial net debt when excluding net lease liabilities was a net cash position of SEK 372 million at the end of the quarter, with cash and cash equivalents of SEK 2 billion, total borrowings of SEK 1.9 billion, and SEK 250 million of prepaid borrowing expenses.

We have a very clear focus on cash flow and cash return on investment, and this is reflected in how we make and follow-up on capital allocation decisions. It will take time for the impact of these actions to be seen in our results, and we do still sit with large and long-term content commitments in our core and non-core markets that we are looking to monetize in as many ways as possible. So that's it from me on the financial performance position.

[Matthew Hooper, executive]

We are now ready to take your questions. [Operator Instructions] So we'll now have a look at the questions. So the first question we have is coming from Tom Singlehurst at Citi. So, Tom, over to you.

[Thomas Singlehurst, analyst]

Hopefully, you can hear me okay. The -- apologies if I missed this at the beginning of the call, I didn't quite capture. But I'm interested in the -- firstly, in the advertising trend, just to see what those are going to things specifically one-off in the second quarter, I don't think you had any particular rights that were sort of expected to significantly boost advertising, and whether that first quarter signals a slightly better outlook for the full year? That was the first question.

And then I'm particularly interested in some of the actions you're taking to sort of crack down or address piracy and account sharing and progress you're making there and the scope of that to drive incremental revenue across the second half, presumably with relatively high jobs. So those are the 2 questions I have in the short-term.

[Jorgen Lindemann, executive]

Yes. So when it comes to the advertising market, as I said, it is a combination of a decline, which we unfortunately still see in Sweden and in Denmark. We could believe that the Norwegian advertising market has been flattish in Q2. But the decline then in the Swedish analog market and then Danish market is then offset by the digital initiatives that we are having, the initiatives that we're having on our digital advertising, the digital eyeballs that we are generating, which was quite substantial also here in the second quarter.

At the same time, we saw very strong radio markets. So we believe that the Swedish radio market would have been up with some 6% and like the same plus minus the Norwegian market. So it is a combination of declined free TV, strong digital advertisement, which, as we said as well, we would like to see replace the losses that we are having in the analog market going forward. So we make that transformation. And then last but not least, of course, that the Norwegian or the Swedish radio market was good.

When it comes to account sharing, we have rolled account sharing initiatives out in the Netherlands and also now in Denmark. And obviously for us, it is important to learn from those 2 markets we are rolling out now as well in the fall for both Sweden and Norway as well, Finland. And the first learning that we are having is that, more than 90% of the people who used to share accounts are still customers with us. That was, of course, a worry that people would say this is not worth it or whatever. We can't share accounts with all our friends and therefore we don't want to be with you.

But I think it is. I think it's very positive and people understand that it doesn't work to watch or to just share content for free. Then it is a little bit difficult to run a business. I think people on fairness appreciate that. That is what we are seeing. Denmark was recently launched and we also see positive signs there. And obviously, we are following what the peers are doing on this space as well. Netflix has been there for some time now and also, as we have seen at least from what they have communicated, have seen good results as well from asking people to be fair and to pay for the content they're seeing.

We, of course, will develop over time our offering as well for the ones who want more accounts to your subscription. So that is something which will come over time. But first and now, it is important for us to end the opportunity for sharing. But there's so much we can do. Then, of course, we have discussions with our B2B partners as well because we are selling our content into their packages that they are selling linear TV channels or whatever in cable universe or fiber universe and so forth.

And obviously, we also see account sharing there. And it is important that our partners take that serious as well, for benefit of all, for sure, all to them, that we are preventing people from sharing those accounts as well. We do have seen examples that there has been business practice from some of our B2B partners to have that as a selling point, that you can share your account, which, of course, is something we simply don't accept. And that is something we're doing, we're discussing with them as well, to be fair.

And then last but not least, the piracy, which is a big issue obviously as well. So we, yes, the politicians of course need to step up, but that can take time in all fairness. So we have ourselves initiated a range of things and speaking to peers in the market, also our shareholders to understand what they are doing in this space. It affects us all. We are talking to rights owners. They, of course, are not happy that people are sharing their rights. It's difficult to sell rights if they are shared broadly almost for free.

So it is a united effort to fight piracy as well. But that is something we are actively addressing as well in different shape and form. But that requires, again, the partners as well, or other banks or what do I know, to play ball as well to make sure that we can either block credit cards or we can block the -- what's it called block the URLs and so forth. So that is something that we need to do much more about.

[Thomas Singlehurst, analyst]

That's very clear. And one maybe follow-on question. I suppose if I look at our numbers and make them not so representative, but I think there was this expectation that profitability would improve through the year. I know seasonally, obviously, the fourth quarter would be bigger -- profitability perspective anyway. But given there's a slightly better 2Q trajectory, is there -- I mean, should we think about the full year perhaps being a sort of upper end of your guidance range, i.e. towards break-even or even flat profit rather than towards the lower end, or are there any other moving parts that are missing on the profitability?

[Matthew Hooper, executive]

Yes, Tom, it's Matthew. We haven't changed the guidance range here, so we've stuck with that, and you have that for the full year, both on the free cash flow and the EBIT, which therefore implicitly gives you a sort of working capital understanding as well. When you look at what's happened in Q2, I was at pains to point out that more than half of that year-on-year delta is due to currency. So we still have that volatility sitting in there, as you know.

It's also worth noting that, if you take the total operating income and you exclude IAC and ACI, we actually have a 75% reduction in the operating loss. There is quite some traction there from the actions that we have taken over the past year. So no, long and short, no change to guidance range at the moment, but I will leave you to draw your own conclusions.

Okay. Just a couple of things on the message board. There was a question regarding no visual presentation today. I think if the question relates to the actual presentation document, it's on the website and available to you. We just wanted to try and keep this a bit short today. We're conscious there's another 60 companies reporting their results today. We know your time is precious. If it's to do with whether we're actually going to be on video presenting to you, we've adopted this audio format for several quarters now, which seems to work well. We welcome any feedback, of course.

Jorgen, a question from the message board for you, which is just to give a little bit more information around the Talpa joint venture in the Netherlands. There's a question from a private investor around that.

[Jorgen Lindemann, executive]

Yes, no, we are, of course, very excited to have teamed up with Talpa, which is a very relevant player in the Netherlands. And obviously, we saw an opportunity, given the vast amount of content we are having, to utilize that much better, to get that out broader and still keep the Viaplay product as a premium product and intact as a very special, unique offering. At the same time, there are events and other products that we have in which actually features very well on an advertising-based channel, which is the case with Viaplay TV now together with Talpa.

So it is actually a win-win for us. So we capitalize even further on our content that we have invested in. And we have now a fairly strong presence as well when it comes to the offering we are having and enhancing the partnership with Talpa. So we're happy about that.

[Matthew Hooper, executive]

Okay. Great. Then I think we'll go to our next caller on the telephone line and that is Mikael Laséen from Carnegie. So Mikael over to you.

[Mikael Laséen, analyst]

Great, I have a few questions. First of all, when it comes to the digital ad inventory increase of 31%, just wondering what does this mean and how has the inventory increased?

[Jorgen Lindemann, executive]

Yes, but that is increasing because we have had more people engaging with our products where we have digital opportunities or advertising opportunities. Now, the trick is, of course, to capitalize fully. And unfortunately, as it is, we're not 100% sold out. So, there is actually opportunities there as well where we are fairly sold out when it comes to our free TV channels. We managed to sell all inventory we're having. There are still even further opportunities in the digital world. So, that is where you are putting or you are launching in interesting content, and then you have a lot of viewing on the content. That, of course, helps then the whale or the minis that you can, the eyeballs you can sell. And that is we have been extremely good at in all fairness the last quarter.

So, it is a strategic important part for us to make that transformation from analogue terminal, you can argue, decline TV as it looks right now, at least. At the same time, though, in Europe, you see analogue TV starts to increase and both in Germany and U.K. now. But we think that it looks a little bit tough in all fairness going forward. And that's why we have initiated the digital initiatives as well. So, if the analogue would not be as terminal as we believe or as we forecast it or I am forecast, then, of course, there is another good positive upside for us in the future. But let's see.

[Mikael Laséen, analyst]

Okay. Any formats that are successful and that can continue to support the inventory there?

[Jorgen Lindemann, executive]

Yes, you keep on innovating, actually, and also the partnership we have with Pluto is also helping out, which is a successful product as well. So, there is new clips opportunities, there is different ways of utilizing our content, the formats that we are having, which are not one-off formats like you have Paradise Hotel coming, 36 weeks. Of course, there is a lot of content in between the weeks where you have, you can utilize that much more. A lot of footage we are not showing today, which we can put online. So, there is honestly quite a lot of opportunities, to be fair, which we want to utilize and capitalize on since the content we are having has traction. So, it generates eyeballs and therefore the opportunities to grow.

[Mikael Laséen, analyst]

Okay. Got it. I'm just curious, how much of the advertising revenue line is coming from digital ads?

[Matthew Hooper, executive]

Yes, it's still sitting at a relatively lower level, Mikael, so sitting below in the 10% to 20% range, but it is growing at double-digit rates and you've probably seen the market spring 15% to 20% as well. So, we've got good growth there. Radio is also strong. I mean, just to be clear here. So, both the Swedish and Norwegian radio ad markets are growing and we've been developing nicely there. So, you still have this sort of broad split of around sort of 70% or so linear, you have around 20% or so radio, and then you have 10% to 20% in the digital space.

[Mikael Laséen, analyst]

Okay. Moving on then to the streaming side. Just wondering here about the ARPU increase of 3% quarter-on-quarter. How much of the officially disclosed prices have so far materialized in the contracts and in your Q2 revenue?

[Jorgen Lindemann, executive]

Yes, that's a good question. So, first of all, on the D2C part, of course, the ones we're not in binding and they are -- if we have 12 months contract or 6 months contract in some areas, the ones that were out of binding, they got the increase and that we have managed to increase on our own side. And we have seen, as you can see from Q1 to Q2, quite good ARPU increases. But despite the fact that we have a decline in the subscriber base, we're still growing 1% quarter-on-quarter. So, that also shows the quality of the content that people are ready to pay for it. So, that's good news.

And then, of course, when it comes to the B2B world of the partnership, it's a little bit different because then exactly some people would be in a binding period. And when they get out of it, of course, they would be, also be part of the price increases. So, it is a mix we are having. So, right now, we are realizing the biggest ARPU increase with ourselves in the D2C part. And then over time, of course, you will see that our partners will follow when it comes to the price increases.

And then, of course, there's a whole other discussion we're having with our partners as well around the ARPU, or how we have historically sold the content to them. And there we have talked about as well that our revenue has increased some 40%, but the cost 80%. So, obviously, that we need to enhance our ARPU in order to make up for the difference of our cost and what we are charging the partners. So, they just multifaceted. But good news is that the price increases have come through and people, see the value for our product.

[Matthew Hooper, executive]

And I think the other thing, Mikael, is that in Q2, obviously, that was when we implemented the price increase in the Netherlands. So, that happened in May. So, the other ones had come in progressively, as you know, but it was May when the Netherlands impacted and that was a EUR 2 increase there.

[Mikael Laséen, analyst]

Okay. Yes. And also a follow-up here. How much is the mixed effect? I mean, if you have churn in the TV movie side and more stability in the sports side, that is, of course, improving the ARPU. Do you have any such effects in Q2?

[Jorgen Lindemann, executive]

Yes, I think there should be a fair assumption to be fair that we see the sports sides being -- being relatively stable as it does. Of course, the seasonal churn you will see. But of course, it is a bit more statement here.

[Matthew Hooper, executive]

And just bear in mind that different markets have different price points. So, as you know, for the Netherlands, it's a prevailing lower price point. So, therefore, when you compare that with the Nordics, it obviously, that has an adverse effect there. But yes, so overall, I think the mix is changing and you're right to point that out.

[Mikael Laséen, analyst]

Okay. Okay. And when you mentioned it, you're still curious about the trend in your different countries in terms of the number of subscribers. How did the Dutch market perform in the quarter?

[Jorgen Lindemann, executive]

Yes, I think we haven't split out any specific markets. I think there were, like always, when there's so many products, so many packages, there's ups and downs. There was, some areas where B2B partner was growing and some other areas where we saw interesting trends in the D2C. So we haven't split that out as such, but aggregated the revenue increased Q1 to Q2 on a lower base. And as you pointed out, the sports subscribers are, for good reasons, the most resilient one, probably.

[Mikael Laséen, analyst]

Okay. Fair enough. All right. A couple of more questions, if I may. First, on the cash flow situation, it improved a lot in Q2, but the guidance is unchanged. Can you help us out a bit on how we should think about the second half? And maybe also repeat what you said about the revolver here that you utilized a bit.

[Matthew Hooper, executive]

Yes. So if I take your second question first, then we drew down 1.5% on the 3.4% just after the end of the quarter, which is natural given the seasonality in these sports rights moments where you know July is a heavy month for us. So that's natural and that is a facility which we will use from time-to-time in order to facilitate these flows. I think when it comes to the broader outlook for the second half of the year, nothing's really changed.

I mean, Q3 is the build-up quarter. So because of those payments we make, you would expect to see those negative changes in working capital coming in Q3 and then a more benign or positive but more muted development in Q4. So that lends itself to the full year outlook on group free cash flow. So nothing's really changed there. I mean, yes, it was positive in Q2, but that is typically more of a release quarter anyway. So it's the natural rhythm. So, yes, but do expect a significant buildup in Q3.

[Mikael Laséen, analyst]

Okay. And the final one, sub-licensing. How should we think about this for the second half? It's relatively lumpy, as you mentioned before, and should increase substantially now in Q3, right?

[Matthew Hooper, executive]

Yes, I mean, obviously you know that we have the Amazon deal, which then kicks in with the beginning of the new Premier League season. So therefore, yes, there should be a significant increase into Q3 and Q4. Q2 is at a lower level. If you remember, Q1 was quite high because we had particularly the non-sports content sub-licensing, which was strong with the Netflix and Amazon deals coming-off the back of Sky Showtime in the fourth quarter of last year.

So, I think, yes, Q1 was high. Q2 has come down quite a bit. Q3 and Q4 should be stronger again because we have Amazon. And then that deal perpetuates, as you know during the coming Premier League seasons.

[Mikael Laséen, analyst]

All right.

[Matthew Hooper, executive]

Yes. We've got a few things on the message board now. So some questions from Evan Campania in Norway. Two questions really, and I'll take the second one first, which is when it comes to the new sports news channel, when will that be launched and what plans do we have around that? And then I'll come back to his other question.

[Jorgen Lindemann, executive]

Yes, we are launching the channel first now in Denmark. And hopefully, we'll take some learning's from that launch. The idea is, of course, to launch it broader in the Nordic region, but the learning is now coming from Denmark, where we also have a fairly big sports hub. So that is coming out now in all fairness, which we are very excited about, and all we'll still be launching.

[Matthew Hooper, executive]

Good. Okay. And then the second question, which is a series of questions, is -- and I think we touched on some of this, but I'll raise it anyway. How is Viaplay working towards content sharing? In the press release, there are some words about limiting the number of current streams possible, but are there also actions in play regarding this problem? There was also an anti-piracy campaign launched in Sweden. Will this campaign be launched also in other markets? Is piracy a big problem in all of the Nordics, or are there countries where this is more frequent? What do you think the politicians should do with this issue? Yes, this is a lot of different questions.

[Jorgen Lindemann, executive]

I think we touched on it, to be fair. So, again, on the account sharing part, that is ongoing. That is what we are working on ourselves. As I said earlier, there are things we can do, and then obviously we do also have the partners which need to take their responsibility as well and make sure that we don't have people sharing their accounts, but actually paying for the content that they are watching. So, this is a work in progress, and we are learning from other peers around the world what they are doing and take best practice there.

When it comes to the piracy, this is not a new phenomenon, unfortunately. That has been the case for years, and obviously what we want to do now is, of course, more forceful, because we do not see the politicians acting as they should, and the way they can act is, of course, about prioritizing this, and also when it comes to legislation to make sure that it is seen as a serious crime, and therefore that you will get seriously fined as well if you are stealing content, which it is, in all fairness, and redistributing it.

So that is -- but it is a long shot with the politicians, unfortunately. So, we are speaking to peers in Europe. Also, our shareholders are very active in that space, obviously. So, we are again there sharing best practice, what can be done. The rights owners as well, of course, the Premier Leagues of the world are very focused on that. There is anti-piracy community as well in the Nordics, where they are sitting in the Board as well of that community. So, it is on everybody's agenda that it is difficult to run a business, if people keep on stealing from you. So, of course, it is serious for us, and that is why we are not waiting for the politicians that they have to act, but it might take too long time, and therefore we need to do something ourselves together with our partners.

[Matthew Hooper, executive]

Good. Well, I think we know you have all got a very busy day. I think that concludes the questions on both the message board and the telephone line.

So, I would just like to say thank you for your time and your questions today. We do really appreciate your interest and always welcome your feedback on the format and content of this session.

We are available for follow-up meetings, of course, so please do not hesitate to reach out to my colleague, Anna or me if you would like to schedule a meeting, or have any further questions. So, that is it for today. Thank you again. Goodbye for now. Wish you a happy summer and see you soon.

[Jorgen Lindemann, executive]

Thank you.