Clas Ohlson AB

STO:CLAS B

Earnings Call Transcript

[Lotta Lyrå, President & CEO]

Good morning, and welcome to this presentation of the Q1 result '18/'19 for Clas Ohlson. My name is Lotta Lyrå, and I am the President and CEO of Clas Ohlson. And today, I will present together with Pär Christiansen, who is new CFO in Clas Ohlson since July 1.So it's actually been 1 year for me now, and I would like to start by saying that I am extremely proud to lead this fantastic company. I'm very confident that we have a good plan to meet the future and that we have a solid team to execute the plan, but it doesn't make me satisfied. We have just started to roll up our sleeves, and that's a little bit the mindset of this quarter, I think.So let me just briefly take you through the agenda. I will start with a business update, and then Pär will take you through the financial development. We will comment on a couple of events after the reporting period, and then we will go into a short summary and then a Q&A facilitated by Magnus Råman.So going in then to the business update. I would like to start by saying that Q1 is according to our own plan, both in terms of the sales we deliver and the underlying earnings we deliver. We see a solid sales growth of 6%; sales increase organically, 10% in total; and 3% like-for-like. Online sales during the quarter grew 60%. And we see this as a proof or a sign of the relevance that our offer has, a little bit independent of the weather. And again, the market conditions continue to be quite challenging. And still, we managed to deliver according to our plan.The underlying earnings amount to SEK 62 million. And I think this reflects quite well the market conditions that we have right now. We have costs in the quarter totaling SEK 30 million. That is nonrecurring or relating to the action program, Clas Ohlson 100+ strategy implementation that I will come back to in a minute and sCORE. So all in all, a solid performance in our underlying operation and according to plan.If I then take a step back, I think it's fair to say that we continue to see a retail landscape in change. Just the other day, the Swedish Retail Research Institute (HUI) released a report where they signaled that the transition from physical retailing to online retailing goes faster than they expected. And of course, what's driving this is the underlying customer behavior that is changing.What we also see in all of our market is that the competition for the consumer's wallet is more fierce than ever, and it's a lot about competing on price. Exactly for these reasons, we believe that the work we have ongoing when it comes to making our offer even more unique and even further developing our customer service is really what's right to focus on.What I also would like to mention is that I think that all of these movements in the market also leads to that challenging the cost structure in each retailer is more important than ever. And there is really no other way to grow in a profitable way. And this is the reason where we decided to make smartness and simplicity, 1 of 3 building blocks in our strategy. And we will, today, communicate a little bit more details around this area and where our target is, and I will come back to that in a minute. And of course, all of this we are doing to create both short-term, but also real long-term shareholder value.If I then comment a little bit on the approach that we have chosen, we have decided to, in parallel, expand our customer base and drive growth and challenge our operational model and our cost structure. And during spring, we, for internal purposes, put all of these actions into a program and with a roadmap to go to it -- go with it. And it consists, basically, of growth initiatives and cost initiatives. And today, we will also form a little bit more in detail around this.So we call this then an action program, and what do we mean by that? It's basically that we have taken the strategy. This program contains exactly the same focus area and content that the strategy did. But we would like to be a little bit more clear on exactly what we are doing, the effect of it and when the effect will come.So in essence, we have already communicated a financial goal of 5% organic growth. That, together with a cost structure, a cost reduction of SEK 200 million to SEK 250 million, will lead to an operating margin of 6% to 8%. So we are working both to drive growth and to reduce our costs.And to make all of this happen, we are investing 1% to 2% of the operating margin in '18 and '19. And of course, we have spent now almost 5 years implementing the sCORE platform, and that's also the base that we build all of these components on.You have seen in today's report that we also now start to use the word underlying result. What we are doing with that is that we are becoming more transparent on how the 1% to 2% that we are investing is distributed per quarter.Going in then to the growth initiatives to comment a little bit on that. First 2 points that really aim at increasing convenience for our customers. We have, during summer, implemented click & collect in all of our markets. And we believe that this is an important step in order to make sure that we can be convenient but at a very low cost for the customer.The second part is that we just, a week ago, increased the assortment that we have at MatHem.se from 800 to 2,000 products. And this is the highest level of convenience that we have right now in the online channel, where you can actually have products delivered same day or next day.Then thirdly, a very important effort that is ongoing is that we are working with our assortment. And during summer, we have addressed approximately 50% of our assortment. And what we are doing is that we have basically analyzed the performance, and then we have put together an action plan to address what we need to address. And this can entail changes in the actual product mix, it can -- has to do with the pricing, sales solution or what may it be to increase sales per square meter. That is the purpose of this activity. And we will now, during autumn, do some tests on this 50% and then move on to the coming 50%.We are also working with our store optimization program where we are testing some new formats. We are doing tests with compact stores in more rural areas, and we are also testing pop-up and lab store formats.Naturally, given what I started with, online sales development is really important for us. And what we see during the quarter is that we achieved growth of 60%. We still come from very low levels, and this is one of the reasons why we need to accelerate fast. But during the quarter, we managed to get a 5% share online of our total sales.Let me then come to the cost-savings initiative where, as I mentioned before, we have decided to be a little bit more clear and transparent compared to what we talked about in May. It's the same focus areas, but we want to be clear that we see a savings potential here of SEK 200 million to SEK 250 million that will be realized during the coming 8 quarters and with full effect from financial year '20/'21.And to give you some more information on the most important 3 areas here, and I will start with a more efficient organization. We have a headquarter with approximately 470 full-time employees. And I believe this is one of the potential that we have in order to actually become more efficient to work with the headcount, especially in the headquarter, and that is something that we have started.As I mentioned before, we are optimizing the assortment, and that can lead to growth, but it's also the base for a more efficient sourcing setup. And the reason is that as the product mix becomes more efficient, it also gives preconditions to actually consolidate volumes and get a better starting point for our sourcing.The sourcing in itself is then a big potential that we see. And today, I would like to mention indirect purchasing. We purchase things we don't sell, products and services, for approximately SEK 1 billion in Clas Ohlson. And here, we see big potential in reducing that spend to contribute to the SEK 200 million to SEK 250 million total cost saving that we are aiming at for the coming years.With that, I would like to conclude the business update and hand over to you, Pär.

[Pär Christiansen, Chief Financial Officer]

Thank you, Lotta. Moving on to the financial development. First part, sales.Q1 sales grew healthily by 10% to SEK 1.958 million (sic) [ SEK 1,958 million ] and, especially, online was up 60%, a focus area for us. Looking at the organic sales where we have the target of 5% annually, we were at 6%, like-for-like 3%. We have added 14 additional stores, net, compared to Q1 last year.And then looking at sales per market, we had healthy growth in all our markets: Sweden grew 6%; Norway grew 7%; Finland, 4%; and outside Nordic countries, by 13%.Then looking at the gross margin. We had a gross margin of 38.5% in the quarter. And the increased commercial activities in the quarter, especially celebrating Clas Ohlson's 100 years with our customers, had effect on the margin. But that said, all of the sales were contributed to gross profit.Then looking at currency and foreign exchange in the quarter compared to last year, we had a neutral FX. The different legs were, of course, contributing in different ways. We had a strong NOK contributing to sales and we had a weaker U.S. dollar contributing to a lower purchase price. But then on the other hand, we had our FX hedges and the currency effects going through our inventory that are lagging a little bit, and you can see that in the quarterly report under our hedges.Then looking at the share of selling expenses. It was at 33.7%, up 1.6 percentage points. And especially, here is one of the areas where we invest 1%, 2%, that we have told you about before. So that is one of the main reasons that is increased.The admin expenses were up around SEK 10 million, as previously communicated in Q4, and we expect that to continue in Q2 as well, as previously guided.Our profit landed at SEK 32 million with operating margin of 1.6%. The earnings per share were SEK 0.47. And then looking at underlying EBIT that we started to communicate now, the underlying EBIT was SEK 62 million and the underlying EBIT margin was 3.2%.The investments in the quarter amounted to SEK 49 million. We had around SEK 7 million on stores and refurbishment and SEK 33 million on IT systems. And also to mention, as Lotta said before, that the sCORE platform is now implemented, which will, of course, affect the investments going further.We have a strong financial position. We had a cash flow from operating activities minus SEK 28 million. Inventory amounted to SEK 1.937 million (sic) [ SEK 1,937 million ]. Worth mentioning, it was down SEK 100 million from Q4. And if you look at the historical numbers, we usually grow between this quarter. So I think, last year, we grew SEK 65 million between Q4 and Q1. And now we were down SEK 100 million. So this was part of our plan to reduce the inventory from the sCORE implementation.The turnover rate for the inventory was 6.2. And yes, that concluded that.Cash flow after investing and financing activities was minus SEK 17 million, net cash of SEK 37 million, and we have right now approved credit facilities of SEK 650 million. So we have a strong position right now.The proposed dividend. The proposed dividend is SEK 6.25 per share, equivalent to 115% of net profit for the full year '17/'18 and is in line with the dividend policy. Good.Today, we also reported the August sales. The sales amounted to SEK 725 million, up 8%. We had growth in all our countries: Sweden, up 2%; Norway, 13%; Finland, 14%; outside Nordic, 11%. And looking at the organic sales, it was up 4%; like-for-like, 1%; and online grew 31%. And we have added 13 additional stores compared to August last year.Handing back to Lotta.

[Lotta Lyrå, President & CEO]

Thank you, Pär. So to summarize this quarter. First of all, Q1 is according to plan, mostly when it comes to sales development and underlying profits as well as profits, reported profits.We are confident in delivering the 4% to 6% EBIT margin for the full year '18/'19 and '19 and '20 as we have previously set out. And we have really full speed ahead on implementing the initiatives that I mentioned before. And the reason for that is, of course, that the quicker we get to growth, the quicker we get the cost saving, the better the result will be. But it means that we are front-loaded, cost-wise, in this quarter, and it will most likely also affect the next quarter.And what are we doing then? Well, we have a number of initiatives when it comes to driving growth related to convenience, but also to optimize sales per square meter, and that is important part to take us to the 5% target. And we are working with a number of cost-saving initiatives within headcount, within sourcing, within product mix to achieve the SEK 200 million to SEK 250 million of cost saving.And of course, all in all, this is about after 8 quarters delivering 6% to 8% profit, and this will be then in the year '20/'21. So I think with that, we are ready for Q&A. So over to you, Magnus.

[Magnus Råman, Research Analyst]

Thank you, Lotta and Pär, for the presentation. I can start off perhaps by asking a little bit about the sales progression, I mean, over H1, if we look calendar-wise, you clearly saw an improving sales trend with positive like-for-like sales. Then coming into the last 3 months, you saw in the summer, I guess, June sales was clearly boosted by your 100-year celebrations. And then in July, you reported negative like-for-like sales. And in August here, you reported slightly positive like-for-like, but it was based on a very easy comp, I'd say, since like-for-like sales was negative 3% in August last year. And just putting this sales progression into perspective of what you mentioned in the presentation, Lotta, about the shift in the retail industry, would you say that this is due to an acceleration of this trend or is it only weather-related what we've seen in the recent months?

[Lotta Lyrå, President & CEO]

I think this summer, it would be naïve not to say it's a mix, actually, because I think, also, we see pure online players indicating that they have been impacted by the weather, so to say. So I think that's a sort of an industry impact. So I think it's a little bit both end.

[Magnus Råman, Research Analyst]

Okay. Then on the cost savings that you give us a bit more detail around in this presentation. You mentioned sourcing as an important part there. At the same time, in this report, you mentioned increasing sourcing cost as a driver to the weak result in Q1, should we see that as a temporary effect or are you seeing a pressure upwards in the sourcing in general?

[Lotta Lyrå, President & CEO]

I think what we need to address is much more, structurally, how we work with sourcing, both in terms of how we actually work with suppliers very practically to achieve a more efficient value chain, but also to actually broaden our sourcing markets. So the ups and downs that you see in this report is more a consequence of raw material moving and so on. But what we will address in the cost saving initiative is much more structurally because I think it's about having another platform for our sourcing that will make us, long term, successful in this area.

[Magnus Råman, Research Analyst]

And broadening to even further sourcing markets, there is no risk that, that will require more from the organization, that you are seeking to reduce headcount in the central organization?

[Lotta Lyrå, President & CEO]

I think the net effect of this headcount work will be that, in some parts, we will have to increase competencies and it might be right, given what you are saying. But in other parts, we have a big need to streamline where it's much more about transactional efficiency-based work. So it will be both end, but the net is that we will be fewer.

[Magnus Råman, Research Analyst]

Can you help us with any lead there to -- more examples of what central cost you are thinking about?

[Lotta Lyrå, President & CEO]

No, but I think we have identified a number of different areas and it's no -- I don't want to go into the details of exactly which department will do what. But I think if you look at central resources, you normally have a mix of transactional work, making sure that things are paid and all of these things, and you have more core and more noncore activities that you can also work with. And then you have the development activities where I think it's also important to say that, if you look at, for example, marketing right now, it's quite a drastic shift towards digital marketing. And of course, we came from another background with more paper-based marketing. That also means something. So there are different components that will enable us to achieve headcount reduction.

[Magnus Råman, Research Analyst]

And then final for me before I leave over to the audience here. On the Amazon trial or actually the commercial launch of Amazon in U.K. that you plan for the autumn. Can you give us any lead to the selection you plan to enroll or list here? Is it comparable to the MatHem corporation or are there any differences?

[Lotta Lyrå, President & CEO]

We see this as a test to understand a little bit about the potential, but also actually to learn how it is to work with an actor like Amazon. And I mean, it's no big magic here. Of course, it's our own brands that we will prioritize and then see what else, but that's really the focus.

[Magnus Råman, Research Analyst]

Okay. Any questions in the audience? One back here, perhaps, Andreas.

[Andreas Lundberg, Research Analyst]

Yes, Andreas Lundberg with ABG. On the cost savings, you talked about SEK 250 million, which it sounds like a very high number given your EBIT last year, you were short of SEK 500 million. Is that, first, a clean number or -- and do you need to take any cost to achieve those savings?

[Lotta Lyrå, President & CEO]

If I start with the last question, the 1% to 2% that we have already guided on, what we need to sort of invest to achieve the SEK 200 million to SEK 250 million is included in those 1% to 2%, so there is no extra cost in order to achieve that. And I understand that it can high -- sound like a high number, and that's one of the reasons why I also mentioned that we have -- we purchased goods not for resale for SEK 1 billion today. We have just below 500 headcounts in our headquarter. And so I think we have done this work very thoroughly. Otherwise, we wouldn't be releasing the numbers. So the SEK 200 million to SEK 250 million, we are very confident about.

[Andreas Lundberg, Research Analyst]

Maybe I'm being stupid, but could you clarify this sourcing, SEK 1 billion, you talked about more in detail? What does it mean?

[Lotta Lyrå, President & CEO]

Yes. It's basically services and products that we don't sell. So it could be everything from toilet paper to IT consultants or marketing agencies or coffee in our offices. So everything we buy to run the business that we don't sell.

[Andreas Lundberg, Research Analyst]

Got it. And what savings comes first now? I think you said it will come gradually from now.

[Lotta Lyrå, President & CEO]

Yes. Yes, I mean, some of these effects, per definition, have a little bit of lead time. For example, on the COGS side, it needs to go through the inventory and therefore, there is a lag. So it will come gradually. And what we are saying is that it will happen during these 8 quarters. And as of financial year '20/'21, there's a full effect. So that's the information we released today.

[Magnus Råman, Research Analyst]

Perhaps a question in the front here from Nicklas.

[Nicklas Fhärm, Country Head of Sweden Research & Analyst]

It's Nicklas Fhärm with SEB Equities. I would like to ask you -- thanks for clarifying the full year guidance, offers a lot of comfort, of course. But as I interpreted, at the same time, a bit of a warning on profits for the next quarter, Q2. Is that reflecting the need to get really ready ahead of fiscal Q3, which, in your case, is abnormally important every year? Is that how we should interpret the perhaps slightly higher need to continue to invest in this current trading period at least? And should we expect a similar margin decline in Q2, i.e. 4 percentage points year-on-year?

[Lotta Lyrå, President & CEO]

If I take the first one and then you can follow up. No, I think the primary effect is actually that we are investing in these cost initiatives to get going on that as quickly as possible. So it has more to do with the action program than the actual seasonal effect. Then you're absolutely right. That's always, and also for this quarter, where we believe that it's more important than ever to be prepared for Christmas, given the competitive climate. So a little bit both end, but mostly related to the program. Then the gross margin.

[Pär Christiansen, Chief Financial Officer]

Yes, the gross margin.

[Nicklas Fhärm, Country Head of Sweden Research & Analyst]

EBIT margin.

[Pär Christiansen, Chief Financial Officer]

The EBIT margin. But I guess, it's also related to the gross margin itself. And I say if you look at Q4, we had 3 components affecting the gross margin, with currency, with onetime cost and also promos and marketing. And in this quarter, we more talk about the marketing and promo parts, so currency will be less affecting us going forward, given everything will be at this stage. And the onetime cost is no longer there. And I understand that it's hard to do a quarterly assumption from your side. Therefore, we -- I mean, we guide the 1% to 2%. So I guess, that one, you got pretty well, all of you. And then each quarter have a little bit of a more strong or weaker in terms of the sales, which will then affect the absolute turn. And I guess, into Q2, we will have the normal seasonal effects building up for Christmas, as you say, both in terms of capacity, but also capabilities. We had the sales for the 100th birthday. We -- I think we sold 3x as much as we thought in terms of visitors on a webpage. We have now introduced click & collect, so we are preparing for that sales period, and that will affect the second quarter. Same with some of the marketing costs that we take in Q2, that will then be launched in Q3, so there's a combination of this.

[Nicklas Fhärm, Country Head of Sweden Research & Analyst]

So what does that mean? Does that mean that margins are going to be down about 1 to 2 percentage points or by 2 to 4 percentage points as in this quarter?

[Lotta Lyrå, President & CEO]

Yes. We don't guide -- I mean, we have given -- we have communicated an underlying result today exactly how much we have invested, the SEK 30 million. And we have guided on the 1% to 2% on full year, and we also say that we are confident when it comes to the 4% to 6%. And then, in addition, we are saying that it's slightly front-loaded for this quarter and the second quarter. So I think that's as far as we go today.

[Nicklas Fhärm, Country Head of Sweden Research & Analyst]

Fair enough. My next question would be when we look at working capital development. So obviously, inventories grew by about 14% year-on-year, sales 10-ish. And I was just wondering, sorry if I missed this in your presentation, but are there any particular reasons for why inventory to sales would come down and improve working capital developments throughout this fiscal year? Or should we expect a little bit along the same lines in terms of an underlying trend for cash flow?

[Pär Christiansen, Chief Financial Officer]

Yes, I understand. We build up the inventory a little bit for the release of the sCORE program in May. And that, we have seen that we are taking it down. We are not fully done with that, so there's an underlying trend going down. And then for the quarter, we added some 14 stores times SEK 4 million, some SEK 60 million up in this volume. So I guess, we believe that we will have an underlying trend a little bit going down. Then also, meeting the buildup for the Christmas, so when you look at it, what is what, I guess it will be difficult. But comparing apples-and-apples, we will have a little bit of a decrease in the inventory because of the sCORE release that we will see. And we also see that, right now, we have a pretty good inventory for the normal products for the Christmas. So we have already started that buildup. So I think no big surprise on inventory levels.

[Magnus Råman, Research Analyst]

Any further questions here in the audience? Do we have any questions from the telephone conference?

[Operator]

[Operator Instructions] No questions registered on the telephone lines.

[Magnus Råman, Research Analyst]

Perhaps, firstly, I could just then tie into the question from Nicklas on your guidance here, your 1 to 2 percentage point guidance. You related a little bit to the Q4 quarter where you had around 5%, 5.5% year-on-year decrease in your EBIT margin. And there, you were quite specific saying those 3 different drivers were sort of equally weighting on results. And now you're saying that the one-offs are gone and then the FX will neutralize. So implicitly, if you're not going to be increasingly aggressive on promotional activity in the coming quarters than when you were in Q4, it implies that you would be, on a quarterly basis, in the range of 1 to 2 percentage points. Is that reasoning fair?

[Pär Christiansen, Chief Financial Officer]

It's not unfair.

[Magnus Råman, Research Analyst]

Okay, okay. Yes, I'll hand over to -- I think it was a follow-up question from Nicklas as well here.

[Nicklas Fhärm, Country Head of Sweden Research & Analyst]

Thank you, Magnus. So can I just ask? Obviously, I understand, appreciate, that sales per customer is very important rather than like-for-like going forward for obvious reasons. But still, sales efficiency rates are going to be, I think, instrumental to the investment case. So my question is could you, at this stage, give us some kind of feeling for the number of stores, say, year-end fiscal 2018/'19 and perhaps some more information on the numbers of square meter developments? Because so far, you're continuing to expand, of course, on both metrics, please?

[Lotta Lyrå, President & CEO]

Yes, you can say that we are -- as we informed about already by Christmas, we are following through with what was contracted, and that is what you see coming in right now. But then we have implemented a much more strict process to actually approving new stores and are extremely restrictive to that, I would say. And then the approach we have taken, I think I said in the Capital Markets Day, we have gone through every single store. And what we conclude is that we have a handful of stores or even a bit little bit less that are actually bleeding, meaning, they don't contribute result-wise. The other ones are actually contributing result-wise. Therefore, we have decided not to launch a store closure program. So instead, we are using the normal break options and the normal possibilities for renegotiation that we have to decide do we step out or do we continue to run. And approximately 50% of our stores are up for this consideration during the coming 2 years. That is the approach we have chosen. And it's actually a case-by-case exercise because, at the end of the day, it's about -- if you have a certain amount of sales relating to a store, it's about ensuring that you can serve those customers in another channel or through another store. And one of the things we have done, for example in Finland, was that we decided to close one store and relocate it because that was more favorable. So this is the way we work with it. And right now, we don't release any specific numbers regarding the square meters or the number of stores, this is the approach we have chosen.

[Nicklas Fhärm, Country Head of Sweden Research & Analyst]

Just a quick follow-up anyway. Do you think that the average floor space will have shrunk at the end of this fiscal year? I mean, you should have some possibilities even within breaks to sort of reallocate space.

[Lotta Lyrå, President & CEO]

Absolutely. I'd say it like this. We are working a lot to increase sales per square meter because I think it's also about when you sit with a certain portfolio of contracts, what we can always do is increases the sales per square meter. And that, I think, is the quickest way, in a way, to actually get the efficiency up, and that is our main focus.

[Nicklas Fhärm, Country Head of Sweden Research & Analyst]

All right, perhaps final question. Last famous words. I was just wondering, in August, let's just -- I think you said it yourself, it's been a complicated summer of trading, but nevertheless, my question is you produced a percentage point like-for-like, so that's good, probably better than most. But I was wondering do you have the same promotional activity, I mean, deliberate promotional activity in this month as you did in fiscal Q1, please.

[Lotta Lyrå, President & CEO]

No. I would say that we actually decided to be a little bit more conservative, and the reason for that was that we could actually see the impact of the weather conditions, but also, if I connect to what Pär mentioned before, we had a fantastic online first quarter, right, but we also -- that also put pressure on the different parts of our value chain. So we decided to hold back a little bit on promotions in e-com in August in order for the logistics to catch up. So -- and in that context, again, I think 1% like-for-like and almost 30% online is, yes, is a number I'm quite happy with.

[Magnus Råman, Research Analyst]

All right. Are there any further questions in the audience? Maybe I can round off with 1 or 2. When it comes to the logistics and deliveries improvements, can you give us an update on the status of the refitting of the Insjön logistics center to better handle single process deliveries as a number one? And then perhaps also help us with an update on the status of utilizing feeder stores for quicker deliveries, briefly.

[Lotta Lyrå, President & CEO]

Absolutely. So we have installed a new packaging machine in the DC in Insjön in order to remove one of the bottlenecks that we have in the e-com flow, which is a lot less automated than the normal logistics setup we have there. So that's one of the -- and then we have done a lot of continuous improvement work. But still, as I just said, it's really one of the most important things going forward to look into how to really make that efficient. Then the feeder store setup, we are working hard to get in place for Christmas, and that is still the plan. And the purpose with that is, of course, that it gives us the possibility to, together with the last-mile providers, allow customers to shop with us online, almost to the day before Christmas Eve. So there's a big commercial potential in that, apart from the convenience that it would give.

[Magnus Råman, Research Analyst]

And on the first reply here on a central capacity for single process delivery, would you say that if you saw online sales penetration come up to 10% in the near-term future, are you rigged with the technology you have today to meet those volumes without delay?

[Lotta Lyrå, President & CEO]

It's a good point. And what we are actually doing right now is that we are looking at our e-com business. If it's [ 1.5 billion ], which is actually what it would be if our targets are fulfilled, how would we then work with that fulfillment? Because we believe that's a little bit how we need to work right now, make sure that every customer is happy, release bottlenecks, continuous improvement, but then also take a step change. And we are in the middle of that investigation.

[Magnus Råman, Research Analyst]

Okay. And perhaps also just a final one on the Clas Fixer service, the rollout plan here, if you can help us with that as well.

[Lotta Lyrå, President & CEO]

Yes, we are still planning for a pilot, a Beta test, before New Year's, in Sweden, Stockholm to be more specific.

[Magnus Råman, Research Analyst]

Okay. If no further questions, I think we'll round off there.

[Lotta Lyrå, President & CEO]

Thank you.

[Pär Christiansen, Chief Financial Officer]

Thank you.