Anora Group Oyj (28Q.F) Earnings Call Transcript & Summary

Good morning, and welcome to this presentation of Anora's Q2 results. My name is Milena Haeggstrom. I'm the Head of Investor Relations here at Anora. And our presenters today are our CEO, Kirsi Puntila; and CFO, Stein Eriksen. And after their presentations, we will start the Q&A session. [Operator Instructions] And please also note that this call will be recorded and published later today on our website, anora.com. And now Kirsi, please go ahead.

Thank you. Thank you, Milena. Hope you all had a lovely relaxing summer break. For us at Anora, one could describe this quarter 2 and the summer in general as a direct reflection of this year's season. The quarter started okay with the Easter effect helping us a little. Then it deteriorated with the rain drops falling in May and early June and then finally started picking up once the sun started shining again. But joking aside, we are dividing today's session into 2 sections. We will first have the regular Q2 business and finance update with Stein. And then I will refer back to what I promised in our last quarterly meeting, which means a reflection of my first 5 months as CEO and how we plan on moving forward. So the beverage industry -- you go back to the previous, sorry. The beverage industry faced headwinds in the second quarter. Yes, the unusually poor weather in May and June affected sales negatively, but also the ongoing shifts in consumer trends were visible in many of our traditionally strong categories. Based on a recent study by Boston Consulting Group, it's a European study from 9 different markets. So 17% of the Europeans say that they are reducing their alcohol consumption. And 27% say that they are actively seeking low sugar and low-calorie drinks and functional drinks are also gaining in traction. In the Nordic markets, the total sales volume declined by 1.8%, with Spirits posting modest growth of 0.1% and Wine saw a decline of 2.1%. The overall picture is still very much the same as in the previous quarter, Q2 being yet another quarter of negative growth in the monopolies, 16th to be exact. But at the same time, Anora is still a resilient player in the Nordics, and we are above the pre-COVID levels of 2019. In total, monopolies represent 45% of the total business in quarter 2, which shows that we are less and less dependent on the monopolies. Let's then dive into the key figures and start with the top line on the left side of this slide. There is no hiding away from the fact that top line is what remains our biggest challenge. Net sales was down by 6.6%, amounting to EUR 165.5 million, primarily due to lower volumes in Wine and Spirits segments. We are, however, pleased to see our gross margin reaching 42.6% of the net sales, supported by improvements in the Spirits and in the Industrial segments. This, I think, is a testimonial to many of our internal efforts working on revenue management and operational efficiency. We also maintained strong in controlling the costs, resulting in reduced operating expenses. Next on line, on the right side of the slide is the EBITDA and EBITDA elements. Our Q2 comparable EBITDA ended up at EUR 14 million, which is 8.3% down from last year. The comparable EBITDA margin was 8.4% of net sales, and the decline can be mainly blamed on lower net sales. In fact, the comparable EBITDA margin increased in Spirits and Industrial, whereas the Wine segment declined due to lower net sales in the filler business as well as increased marketing spend, and I'll talk more about that later on. Despite the less than satisfactory result in Q2, when looking ahead for the full year 2025 guidance, we still remain confident in hitting that window of EUR 70 million to EUR 75 million. And why do I say that? Let's look at some of the highlights of Q2 to build further confidence for the rest of the year. Firstly, I am very pleased to note that our targeted wine campaigns in Sweden are delivering strong results in winning market share. And this is no longer a 1-month wonder, but a result of continuous and well-planned efforts. And the same goes for the ongoing success of 8% wines in the Finnish grocery channel. Overall, our new relevant launches and partner wins, especially in Sweden are our medicine. And this medicine, we intend to copy also to Finland and Norway, but this is, of course, taking a little bit longer time to finalize in the rest of the markets. Secondly, we have our dear Koskenkorva, which keeps on giving month after month. We are very quick in reacting to changing consumer trends and also providing markets with lower alcoholic variants and ready-to-drink options. The success of our recent liqueur launches, let alone the new Koskenkorva Lonkero, long drink range, they are contributing to double-digit growth for Koskenkorva. Also, I think I mentioned last time the challenges of our traditional aquavit category in expanding into new occasions. And now it looks like we have a very good start with a product called AMP, the on-trade targeted nightlife shot product. And the third element because of which my confidence is high, is based on the markets beyond the Nordics. Lithuania has now been operational for a couple of months, and we see positive signals also from global travel retail with our biggest accounts. Then I will move on to give you a bit more flavor to each of our segments. There. In Wine, our total net sales declined by 8.9% to EUR 74.9 million. The timing of Easter in April was not enough to compensate for the decline of net sales. But let me explain a little bit more on the dynamics of the Wine segment content. It is basically divided into 2 elements. One is with the lack of a better word, so-called commercial own and partner brands business. And the other one is the so-called filler business, which is the factory capacity that we sell to others. So the bad result in Q2 was, yes, partly caused by weaker wine sales in Norway in particular, but mostly by lower demand and increased price competition of filler services in Denmark. Gross margin in the Wines was 28.5% of net sales, gross profit amounting to EUR 21.3 million. Since the last quarter, we have focused on gaining market share, particularly in Sweden, which we are very, very proud about. So this, together with the success of the 8% ABV wines in the Finnish grocery channel led to market share growth. Wine segment's comparable EBITDA declined to EUR 1.9 million, which is 2.6% of net sales. And this is, of course, something that we need to address moving forward. As said, the decline was mainly driven by the lower net sales in the filler services, but also due to increased marketing spend in the first half of the year. We discussed that already last time around, and this will be offset now by the second half of the year where we won't spend as much and hence, the full year impact of the marketing spend will remain stable. Then over to the Spirits segment. In the Spirits segment, net sales declined by 8.4% to EUR 53.6 million. And this is explained mainly by the recently lost partners. In fact, 2/3 of the negative this quarter is due to the previously communicated partner losses. Our market shares declined across main countries with Norway, in particular, experiencing weak performance. Koskenkorva net sales grew from the previous year, representing almost 18% of the total Spirits sales. So Koskenkorva is a significant brand for the Spirits segment. And despite the slightly lower volumes, our gross margin improved again to 45.2%, which is reflecting the impacts of revenue and mix management. Gross profit amounted to EUR 24.2 million. Then EBITDA, Spirits segment's comparable EBITDA amounted to EUR 8.6 million. But although the absolute EBITDA decreased slightly, the good news of the quarter is that comparable EBITDA margin increased to 16% of net sales, thanks to lower operating expenses. And then finally, the third segment, which is Industrial. The Industrial segment's net sales increased, and that was mostly driven by phasing of contract manufacturing volumes, offset by lower volumes of other product categories as well as side product sales prices. In Q2, the Industrial segment's total net sales declined to 57.8%, while the external net sales increased by 1.6% to EUR 36.9 million. And this is mostly driven by phasing of contract manufacturing volumes, as said. Industrial gross margin increased to 49.6% of net sales and the gross profit amounted to EUR 28.6 million. Comparable EBITDA increased to EUR 3.9 million or 6.7% of net sales. So with these key highlights, I will now hand over to Stein for a bit deeper financial analysis and then continue more about the next steps after Stein.

Yes. Thank you, Kirsi, and good morning, everybody. Let's have a look at the financials for Q2. Before starting with going deep dive into the numbers, let's start with a summary of the highlights in Q2 related then to the financial summary. Sorry, some technical issues here.

Looks like we're starting the Q&A earlier than anticipated. Now I think there's something...

Yes. So let's start with the highlights of Q2. So I think it's fair to say that Q2 was a mixed bouquet. It's -- what we can say is that we are pleased with the gross margin development. We are pleased with the OpEx reductions, and we are pleased with the improved performance in the Industrial segment. However, I think it's also fair where we are not pleased, it's the development in net sales, and that was the main driver for the EBITDA decline then -- that ended at EUR 14 million compared to EUR 15.2 million this year. Net sales, as Kirsi said, decreased with 6.6% or EUR 11.6 million, where around 2/3 of the decline is related to the lost partner business in Spirits and lower filler volumes in Wine. Looking at the balance sheet, Anora ended with a net debt of EUR 199 million, fairly in line with last year and liquidity reserves ending at EUR 297 million, somewhat lower than last year, partly explained by lower sales of receivables this year compared to last year. We are also happy to see that we had an underlying reduction of inventory of EUR 20 million, driven by good improvement in Industrial as well as reduction of partner inventory in both Wine and Spirits. Then let's see some of the most important projects that we are currently working on in the finance and IT. And I'm pretty convinced that these projects will contribute not only to enhance the financial follow-up of Anora, but also improve the underlying operations of the company. Starting with number one, earlier this year, we successfully migrated Anora Denmark to our common ERP platform. And also, like Kirsi said, we established a new entity in Lithuania. The next major milestone is integrating now Arcus Norway into our common Anora SAP solution. And this transformation will significantly strengthen our internal control and follow-up. It will unify our master data across the group and establish standard procedures and processes across the company. It will also allow us to unlock further synergies, particularly in areas such as procurement. The go-live for this project is expected to take place in late Q4 this year. Another important step that we have taken in Q2 is to enhance our Power BI capabilities, and we have established a dedicated Power BI team within Anora that will accelerate the development and enhance the relevance of the reporting. And this is everything from market data to better and improved follow-up of inventory as well as we will also look in improving our current pricing routines and pricing follow-up. So really seen progress so far in Q2 and expect more in the upcoming quarters. During the quarter, we also successfully implemented a new cash management system, and this will improve the cost efficiency, flexibility and security of our payments going forward. And we already touched upon the inventory reduction and the cut of number of SKUs, but another complexity issue in Anora is the number of legal entities. And we are also working to reduce the number of legal entities. And so far this year, we have either closed down or merged 5 legal entities in Finland and Denmark, and we have another 6 additional entities that are scheduled to be closed down for the rest of 2025. Then let's have a little bit deep dive into the net sales development in Q2. I think Kirsi has already mentioned a lot of the explanations. But if we start with Wine, that declined with 8.9%, ending at EUR 75 million. The decline was, as she mentioned, lower demand and increased price competition of filler services in Denmark as well as weaker sales in especially Norway. Owned and partner wine sales declined slightly, but we are very pleased to see that the strategic focus of the Wine segment in Sweden, but in particular, has resulted in strong market share increase in the quarter. In Spirits, net sales decline was explained mainly by the recently lost partners and industrial net sales mostly due to the phasing of contract manufacturing volumes explained the increase, offset by lower volumes of side products. And for the first half year, the net sales was down with 5.3% to EUR 306.8 million and once again, primarily due to the lower volumes in the Wine and Spirits segments. Then let's move over to gross margin. And as I said, we are fairly happy to see a continued improvement in gross margin. And as you can see on the right-hand side, the underlying development in gross margin has been constant. It has been a constant trend now for several quarters and years and continues then to trend positively. And we ended first half year with an underlying gross margin of 43.6% in the first half of 2025. The input cost here exemplified with the development of Finnish barley has flattened out and the improvement is mainly due to improved revenue and mix management as well as improved efficiency in our Industrial segment. Then let's move over to comparable EBITDA in Q2 that ended EUR 1.2 million below last year. The decline was solely explained by the decline in net sales versus last year as the gross margin improved as well as the OpEx decreased in the quarter. Looking at the different segments, Industrial had EBITDA growth due to continued efficiency improvements in supply chain, and we also had some improvements in the group's expenses due to different timing of expenses. Spirits was slightly down in EBITDA, where lower sales were compensated with higher gross margin and lower OpEx and the Wine segment was mainly down due to lower net sales. Then let's move over to the balance sheet and the cash flow. Operating cash flow ended at minus EUR 53 million, somewhat lower than last year. Liquidity reserves at the end of June ended at EUR 297 million and comprised of the group's EUR 20 million overdraft as well as an unutilized revolving credit facility of EUR 150 million. Net debt ended more or less on par with last year, EUR 199 million, and the leverage ended at 3.0 compared to 2.8 last year. If you look a little bit more in detail into the net debt development, that ended in Q2, as I said, at EUR 199 million from EUR 122 million at the end of Q4 last year. And no drama here. As you can see, the EBITDA explaining, of course, a positive development of EUR 22 million. But as you also know, we normally have a buildup of working capital in the first part of the year, then mainly explained by inventory buildup as well as payment of excise duties. Net financial expenses were EUR 8.4 million compared to EUR 9.6 million last year, then mainly explained that we paid down some of the loan facility, the term loan last year of EUR 50 million. And then CapEx ended at EUR 7 million. That was also on par with last year, then mainly related to replacement investments and improvements. And dividend ending or that was paid out of EUR 14.9 million by the late of April 2025. Moving over to the last slide before handing the word over to Kirsi, and that's the net working capital ended at minus EUR 10.3 million or minus 2% of net sales at the end of June. And as you can see on this slide is that we have had quite a good reduction of working capital compared to previous years, of course, also then, as you know, related to the increased sales of receivable program that we launched in beginning of Q1 2023. Like I said, we are happy to see inventory reduction of EUR 20 million compared to last year, and this was driven by -- around half of it was driven by Industrial, but also good improvements by both Wine and Spirits. However, I said it before, I say it again, we still have potential to reduce the inventory even more by especially then focusing on our tail products. So that was the financial review. Then leaving the floor over to you, Kirsi.

Thank you. Thank you, Stein. I will first now summarize the key takeaways of our quarter 2. So market -- firstly, market share in wines is now showing longer-term positive development in the Nordics. That's the good news. Secondly, net sales was down by 6.6%, amounting to EUR 165.5 million. Thirdly, gross margin shows nice continuous improvement, thanks to our ongoing efforts on it. And fourthly, comparable EBITDA ended at EUR 40 million, which is 8.3% down from last year. And as to the full year 2025 guidance, our comparable EBITDA is still valid and as I said before, expected to hit the EUR 70 million to EUR 75 million target. Very good. I would then -- or is there -- yes, I will move on, and I'd like to change the gear a little bit and leave the Q2 behind for a second. The only way is up, as they say, and I continue believing in it now after having analyzed the business thoroughly with our team in the past few months. In the Q1, I stated that I will allow myself to pause before speed and analyze the situation at Anora properly. So after the first full quarter as CEO, the prework is now done, and I'm quite pleased with the diagnostics. So the key reflections of the first 4 -- 5 or so months is that we have a strong foundation, and we have a strong portfolio to build on and generate sustainable profitable growth. However, it is true that our operating environment is tough, and we have not succeeded in turning the company to a success story since the merger a few years ago. Furthermore, our current performance is not good enough. So third reflection is that we do need clear actions to accelerate our performance in short to midterm to improve our cost competitiveness as well as pursue opportunities in our portfolio and core business, and I will get back to those shortly. But finally, it's not all doom and gloom. There are opportunities and growth opportunities in our current markets as well as beyond them and beyond the core, what we're doing right now. But before considering those, we need to fix some of the ongoing challenges at our hand. Therefore, we have initiated a strategy process to meet the needs of the changing environment. I will now go through them briefly and have them section -- reflection by reflection. So starting with the strong platform and maybe not reading this through all the way. But as I said, we have a strong foundation, our strong brands, our ability to innovate and our very talented people. So the portfolio to build on our future growth. We have an established presence across on-trade and off-trade, so all the channels in our markets. We are a multichannel operator. We have capacity to create innovations and push forward the launches as we have hopefully witnessed and shown you in the past few months. And we also have some of the most -- Nordics' most respected and loved professionals in different disciplines. So in this context, I would especially want to thank our customers and partners for their trust, but also our employees for their continued dedication. But going to the next reflection, clearly, something is not 100% right. Someone once said that in order to know the future, you must understand the past, and that's what we have been analyzing. So it is clear that some of the internal challenges that we have are listed here. We have overcapacity in our current footprint. We need to further improve responding to challenging -- changing cost levels. We are only now getting clean from some of the recent merger complications. And there are important pockets of categories where we are not present currently with our legacy portfolios. And those are the so-called low-hanging fruits that we can quite immediately fix. Externally then, there is no significant growth in our current markets or Nordic monopoly channels. Customer consumer behaviors are really changing, and there are an ever-increasing pace of change when introducing new products and packaging formats. So how do we respond to all of these challenges? We respond to them by introducing a program where we can fix the business together. Before investing heavily in the actual growth, organic or acquisitions, Anora must first fix its current performance. Therefore, we are now engaging in a strategy work in the coming months to define our midterm growth ambition and work is divided into 2 phases. It's -- first and foremost, is Fit & Fix, and then it is the Focus area. So the Fit and Fix phase is delivering short and midterm performance improvement over the next sort of couple of years. And then while the focus is driving growth initiatives from 2026 onwards. And perhaps then diving deeper into the fix area. So elaborating the sort of fit and fix phase, we are investigating numerous areas and actions to strengthen our performance. And these actions include looking at cost competitiveness and operational efficiencies, portfolio optimization, Stein mentioned, inventory and revenue management, which is already showing very good traction, but we need to accelerate those work streams, looking at the product portfolios and launch execution and then, of course, the balance sheet efficiency, just to name a few areas that we want to look into. So to sum up, it will be hard work ahead us reaching our goals, which is why we're not only accelerating actions to improve our financial performance here and now, but we are also beginning to update our strategy to guide us through 2028. So we are talking rather a midterm strategy than a very long-term strategy in this respect. So I look forward to sharing more about these initiatives at our upcoming Capital Markets Day in Helsinki, which will take place on the 5th of November in 2025. And with this context, I will finish by welcoming you all warmly to that event in November. Right. I guess it's now time to go back to Milena. So I'm looking right and left because Stein is on my right side and Milena on my left side, and we can open the Q&A.

Yes. Thank you, Kirsi and Stein. And we already have the first question here. It's coming from Maria Wikstrom.

Yes. I mean thank you for the presentation as well some thoughts, I mean, for the -- like future strategy. I wanted to get a bit more color on the partner losses in the Spirit segment. And I mean you said, I mean, this has been discussed in the past, but if you could just remind me a bit on the reasons and on the number of and maybe the magnitude of the partner losses in the Spirits segment?

Yes. Thanks, Maria. There's a little bit something in the voice. I don't hear Maria super well, but I think I got most of it. So you talked about -- asked about the partner business, especially in Spirits. And I think, of course, it's unfortunate, but as I said here internally as well that I've also been on the other side of the table where you -- when the economy is in downturn, very often brand owners start then looking at the solutions that how can we improve the situation. And then obviously, the quick fix is to look at the current distributor and see what can be done there. So there's many of the changes or the losses, partner losses in the Spirits is more of a natural phenomenon of natural change. We've experienced a long period where Altia and Arcus back in the day and Anora now have had very long-standing partner relationships. So some of them is more of a natural movement when the going gets tough that you tend to change the distributor. And then very often, you also come back to the old distributor. And this has also happened to us already now in some cases. But yes, of course, very, very unfortunate. So we have had sort of some significant partner losses. So that, of course, affects the overall net sales and even the share development. Still, we also have a short list of very strong candidates to replace those partners. But as in partner business, you lose the partner very quickly, but gaining it takes a little bit more time. So I can't unfortunately reveal or talk more about the future partners. But that is correct. We have lost some of the partners with Spirits.

And can you be more specific? I mean, when these losses started to have an effect, so that will help to build up the forecast I mean, going forward?

These losses that we talked about have happened already. So we're seeing the effects now. There are no new partner losses that has happened in the past few weeks or months. But these are the losses that we discussed, I think, already last time. So there's no further losses, at least in sight, hopefully not happening.

And when we think about the future, I mean, the partner sales are still in your comparable figures until Q1 '26? Or how should we look at that?

Yes. Do you want to, Stein? Or do you want me to?

Yes. So Maria, you can calculate around the same loss that we had in first half, and you can just multiply that with 2. So we will see more or less the same effect on the top line in Q2 -- in the second half of 2025 as we did in the first half of 2025.

Yes. Perfect. That's helpful. And then I wanted to touch upon the competition. I mean, given that the monopoly volumes have been muted for some time. I mean typically, I mean, then there -- I mean, a lot of the players are just focusing, I mean, getting some volumes, and I would think that the price competition is intensifying. So how could you describe the competition situation? I mean across your Nordic markets?

Yes. Obviously, the biggest markets where we can see the sort of a negative effect are Finland and Norway for rather different types of reasons in Finland, of course, the channel shift from the monopoly to the grocery retail is a significant change for us. Still, as you know, I mean, the market share for wines in Finland is extremely strong. And then we are accelerating also in providing products of low alcoholic beverages to the spirits -- in the Spirits segment to the grocery. So then it's that whole playground in Finland has changed quite a bit in the past year since the 8% wines were introduced to the grocery. Then looking at maybe the other sort of market where you see the sort of share losses mostly is Norway. And that is a combination of different elements. I mean, historically, if you look at our business in Norway, it's probably the most polarizing in the way that we have been very dependent on legacy categories such as aquavit. And there, the sort of changing to the grocery retail takes a little bit longer time because there hasn't been the similar type of law change as in Finland. So we have more of a polarized portfolio that we have the legacy categories that have recently been declining. And then the speed of moving to the new channels and getting listings in the segments where we are not yet present, it will take a bit longer. It doesn't mean that the plans are not there or the actions are not there. But in Norway, it looks like it's taking a little bit longer to be able to change that environment. So the competition is -- there's no new -- I don't know how to say it, but there are no new miracle brands or products that would be completely disrupting the market that we wouldn't know of. On the contrary, I would almost say that we are quite quick in reacting to the market changes as far as the consumer trends are concerned. But yes, in certain markets like Norway, turning this ship is taking a little bit longer than maybe somewhere else, like in Sweden, where you can quicker react to the wine market share changes to say one example.

And then finally, I would like to ask for the growth rates in the nonalcoholic category. And if you could remind, I mean, how much of your sales is, I mean, from nonalcoholic beverages? And then also interested a bit more color on the RTD segment. And is that -- mostly like now you talked about Koskenkorva, I would assume that this is relating to Finland. But if you can talk about your RTD strategy across the Nordic markets and bit like how big part it represents currently on your sales?

It is growing in importance, of course, because of the consumer trends, but also because of the Finnish grocery channel, as you rightly pointed out. We do have, of course, I mean, the 2 biggest pockets of the, I would say, ready-to-drink business is coming from the Koskenkorva variants, which is now the new -- Lonkero -- 3 new long drink variants, and we are obviously introducing new products to that portfolio. But also, as far as the partners are concerned, our Pellegrino water brand is a very important brand for us, and we are super proud of the Pellegrino success in Finland in particular. So yes, it's growing in the actual percentage, I don't know if we're going to reveal that or not. But I mean, it's a more and more significant part. And for us, the low-alc basically means wines that are less than 10%, spirits that are less than 30% and then, of course, the sort of RTD and the nonalcoholic beverages, which are also growing in terms of the total share of portfolio. The challenge, of course, is that if I'm totally honest, is that when you come with a background of Spirits business, it will take some time for us to offset, of course, some of the losses that we are seeing now, especially in Finland when the Alko numbers are what they are. But we are very good in responding to that changing environment. But the actual percentage, how quickly we are growing it, we will not maybe reveal here.

Actually, Kirsi, maybe I tell that it was disclosed actually in our sustainability report. So it's 5.9% for last year. And we have the next question coming from [ Heietela ] .

I kind of missed the part you were talking about barley prices. Have I understood right that other raw materials have risen in price, but barley has fallen? And what was the effect of that to you? And secondly, barley price is very low now in Finland. Are you worried about the situation about the future of barley farmers?

Yes, I can comment on the barley prices. Yes, of course, barley, especially Finnish barley is a significant part of our input costs. So -- and that's also why we choose to show it on a separate slide. But it's exactly like you say, the barley prices, they are at a low point and lower than what we expected at the beginning of the year. I think that's fair to say. I mean the harvest of Finnish barley will be now during the next 2 weeks, of course, really excited to see how the harvest will go. But you are correct, the barley prices is at low levels. When it comes to your second question related to the farmers, I don't have any good answer to that, I think. I can't really answer what the farmers are thinking. But you are correct, the barley prices in Finland are at low levels. And of course, this will also potentially impact our gross margin going forward.

I think the farmers have been quite happy in the past years because the barley prices are quite up.

Yes. Exactly. Yes.

Thank you. And let's move ahead. So we have the next question from Rauli Juva at Inderes.

Rauli from Inderes. Just wanted to ask on your outlook assumptions. Basically, you continue to see that the full year market volumes would be roughly on the same level as last year and the H1 was down 5%. So is that kind of -- is that still in the range of roughly at the same level? Or are you expecting some improvement in the market volumes for the second half?

Do you want to start and then I can...

Yes, I can answer that one. Yes, it's like you say, Rauli, yes, the volumes, they have been pretty soft for the first half of 2025. It's between 4% and 5% in volume decline for the first half. We do believe somewhat improvement in the second half of 2025. That's in our internal prognosis. But of course, let's wait and see. But as you know, the monopolies, they have launched now the July numbers, and at least they look somewhat better than the year-to-date numbers. Then I've touched a little bit about the guiding that no doubt that we are somewhat underperformed versus our own expectations for the first half of 2025. But then also remember that Q3 and Q4 normally is between 65% to 70% of Anora's yearly results. And when it comes to the guiding, it's based on thorough estimates, and we are still in -- still believe that we will be in the range between EUR 70 million and EUR 75 million in EBITDA.

Yes. And how dependent is that on some recovery on the market? So if we would see minus 5% for the full year, is it possible to reach your guidance with those kind of market development?

I don't want to comment specifically on the numbers. But what I can say is that when it comes to our internal prognosis, we are pretty pleased, as I started with, with the development in gross margin. We are pretty pleased with the OpEx development. And also, like Kirsi said, we are accelerating now the actions with the Fit, Fix and Focus program. And then also, we have a strong brand portfolio in Koskenkorva. We are gaining stronger and stronger momentum in wine, especially in Sweden, that is the biggest market. And then we have an upcoming and important glögg season and at least from what I hear from our internal people is that we have a strong glögg program coming up in Q4.

Yes. Maybe I can add on the excitement on that because it is true. I mean, as Stein mentioned, we now have the -- we're accelerating our ongoing initiatives, but -- and also we have the less and less dependence on the monopolies. But that third part that Stein was mentioned, obviously, the ongoing Koskenkorva success, market shares in Sweden, which we believe that will accelerate and we can start copying also to other markets, but the glögg season, I just wanted to add on that. We obviously are not allowed to reveal what the next Blossa annual is. So welcome to the PR event. I think it was the 10th of September, if I remember correctly. But we've also now been able to extend the period of the glögg season, so to speak, and we're launching a glue wine as well as pumpkin spice for the Halloween season. So I think we are really, really excited for the upcoming glögg season in the Nordics.

Yes. Maybe you should sell the clogs and glue wine also in the rainy summer days.

I fully agree. I fully agree. And obviously, also in all the Alpine countries, I would say.

But yes, one more serious question still. On the sold receivables, you have declined on that now. Is that likely to be a permanent shift on the policy? Or is that something that varies?

Yes. It varies a little bit between the quarters, Rauli. But I think we also mentioned before, we have stopped selling the receivables of Globus Wine, and that's around EUR 10 million. So it will be at least constant with EUR 10 million lower than what you have seen if you compare to last year.

[Operator Instructions] Let's give the floor to Sanna Perälä.

Sanna Perälä from Nordea. I would still like to touch upon the guidance. Rauli already asked something, but could you elaborate a little bit more on the like concrete measures you will be taking in order to improve your profitability in H2? And is it -- does your guidance require just the profitability improvement? Or will it require also top line growth as well? And if so, how will you achieve it? Market share gains? Or what does it require?

Yes. I think we mentioned about the Fit, Fix and Focus initiatives that we will then be telling more about in the upcoming weeks and months. But I don't know if you want to further add anything on top of what we've already said, which is our belief in the markets being sort of flattish overall. And then our initiatives, as mentioned in terms of the revenue management and the further market share improvements and then the brand portfolio initiatives, as mentioned. But I don't know if there's anything further that you want to sort of get into the details, Stein? But it is based on these elements that were mentioned to Rauli already.

And then let's give the floor to Matti Kaurola.

Maybe like other analysts already covered my other questions, but a bit more about this longer-term outlook question. So we've seen, like you said, 16 consecutive quarters of declining monopoly sales. And you also mentioned the BCG report in which they were saying that the alcohol consumption in general is quite drastically decreasing in the whole Europe. And is this kind of an existential question to Anora? How are you going to mitigate this kind of structurally melting top line, so to say? I mean, like, of course, you can do internal cost savings and improve the -- on performance. But if you're in a structurally declining market, how are you going to kind of respond to that in a way kind of find some sort of growth story around this kind of structurally weakening situation?

It's a very good question, an absolutely relevant question, and that's exactly what we are working on here in the upcoming weeks. And then we will talk more about our growth path and growth opportunities and growth plans in the Capital Markets Day in November. But of course, I'm still saying the same thing as I did in the quarter 1 is that it's not like the change is happening overnight. And I think already now, we are well advanced in making those structural changes also internally so that we are doing things differently. We're looking at our portfolios. We are filling the pockets of opportunities. It's not like people are stopping drinking altogether, but people are more conscious of the choices, what they are drinking. The occasions are still there. So we don't see that this is like a drastic decline per se, but it's more of a little bit of a change and structural change for sure. But still, I would say that we're very capable of changing Anora to be successful and winning in the new environment as well.

All right. Then maybe other question. You said that you are not too dependent on the monopoly sales anymore. What are then the other channels? Like what is the remaining 55% of the kind of channels you are selling?

Don't get me wrong, monopolies are extremely important for us, and we are doing everything in our power to keep it that way so that they are by far, single most important channels for us. And we have a very good relationship in all Alko, Systembolaget and Vinmonopolet. So we hope that, that will not go away. But of course, back to your original question, we are quickly adjusting to the changing market environment, which means that the other markets and channels that you were mentioning, of course, the retail in Finland, the growing grocery also in Sweden and Norway. But as was in our longer-term strategy in the past Capital Markets Day, the 3 different -- 3 pillars of our strategy are the Nordic markets, but it's also adjacent markets. And by that, we mean Denmark and all of the Baltic markets and finally, the international expansion. So in the second strategy pillar, we are now obviously growing Denmark as we speak. And as I mentioned, we, a couple of months ago, opened up our own operations in Lithuania, which makes us a strong pan-Nordic, pan-Baltic operator to give the best service for our customers and our partners. And then the international expansion is developing as planned. I think I mentioned last time that we are consciously increasing our share of international business. We're not doing any crazy promises or crazy jumps here and there, but we are very structurally and constructively increasing the share of international and global travel retail for that matter. And on that front, I can happily say that now it looks like the global travel retail is also turning after a very, very difficult period of time. And we see some growth in -- with our key customers in global travel retail as well.

And then let's move on to the chat questions. We have 2 questions from Georg Liasjø. So let's take the first one. On a general level and as a ballpark number, what would you say the margin potential accounting for initiated efficiency measures on an adjusted EBITDA basis for Anora would be at the current level of activity without making any assumptions about increased sales or mix switches?

Do you want to take that?

Yes. I think we save that for the Capital Markets Day, to be honest, we won't reveal any numbers here.

And then continuing more specifically, if I understand it correctly, you are currently paying about EUR 8.5 million or NOK 100 million per year to lease the facilities at Gjelleråsen. At the same time, you have significant overcapacity at this facility. What is your best guess regarding underlying annual savings potential if you were to move out to a more appropriate and rightsized facility? And would it be possible to achieve such savings prior to '36?

I don't think we will answer that question either. It's...

I think I can only say that, of course, with the program that we are launching, we, of course, evaluate all the aspects of the company, and that's the work that we will initiate now. So obviously, the supply chain footprint is part of the evaluation.

Okay. Thank you. And do we have any more questions from the live audience or from the chat? [Operator Instructions] It doesn't look like that. So thank you to the speakers and to everyone joining us online and for all these good questions. And please be reminded that our next scheduled events are the Q3 interim report on 31st of October and the Capital Markets Day, like I said, on the 5th of November. So please mark those in your calendars and look forward to seeing you then. Thank you.

Thank you.