Cloetta AB (publ) (CLAB) Earnings Call Transcript & Summary

Good afternoon and a very warm welcome to Cloetta's Investor Day 2025. My name is Laura Lindholm. I have had the pleasure for a bit more than a year to be the Director of Communications and Investor Relations. This is our first longer update since 2019. So we felt it was time to take the time and the whole afternoon today to talk a little bit about our journey ahead. Before we kick off the compulsory health and safety statement. So there is no fire drill today. If you hear an alarm, you use the door from which you came in and then we move 100 meters very calmly to the right, your left. Then also before we kick, especially those of you who look at this online might be quite new to Cloetta. So we take the opportunity to present a little bit ourselves and what it is that we are about. [Presentation]

So to kick off today and today's agenda, first, we have Katarina Tell, our CEO, who will walk you through the market and our strategy ahead. Then it's over to our CMO, Thomas Biesterfeldt, who -- I think we have a technical issue. Sorry, guys, we'll just change the remote control. If we could have the agenda slide maybe. [Technical Difficulty] Perfect. Thank you very much. So first is Katarina Tell, our CEO, she will she will walk you through our market and our strategy ahead. Then is over Thomas Biesterfeldt, our CMO, who will take you through the marketing and innovation. Then we will just have a short section Q&A, and then we will only take questions from the room. We'll have a longer Q&A then at the end, where it's also possible for everybody who's online to ask questions. Then after that, it's Niklas Truedsson, who will take you through our Pick & mix and for that business area. And then he will hand over to Frans Rydén, our CFO. And after that, it's time for a short wrap-up and then also the longer Q&A. Perfect. I will now hand over to our CEO, Katarina.

So I think that works. Good afternoon, everyone. And a special good afternoon to you guys online as well. I'm really happy to see you here and also for you who are online that you show this great interest and support for Cloetta. As Laura was saying, we have a really interesting day today. first, we're going to talk about Cloetta today. Then we're going to talk about our plans and strategies going forward. And I'm also super happy to share our new vision. Key message is we will continue to focus on profitable growth, and we will do that with clear priorities. I also look forward now for this day because you will be here in the room, we will have breaks and so on and there will be opportunity for questions and answers and so on. So I really look forward to have the interaction and also that we do this to a very inspirational day. But before I will go into and talk about Cloetta. I will just give a short introduction to myself. So I'm Katarina, and I'm the CEO for Cloetta. I've been at Cloetta for 7 years. Before I stepped into this role, I was the area President for Sweden. And before that, I was working at Findus and at Kraft Heinz for 10 years. The common nominator, I would say, for my 25 years in the fast-moving consumer goods industry. I say it's almost impossible. I can work so many years. I'm only 27. But regardless, the 25 years, it's been strong brands and to drive profitable growth. So that is my passion and what I've always been focusing during my career. So shortly, also I stepped in the role in June last year in the new role and when I approach this role, I was thinking, first, we need to set a vision where do we want to go with the company. Then when we have the vision, of course, we need to set a strategy, how do we reach our vision. And then it's about how do we organize ourselves to make this happen, and then it's all about execution. So when I stepped into the role, I started to listen and talk to different stakeholders. I also did a survey on the entire Cloetta to ask, what is the feeling? How does your perfect Cloetta look like? At all those information that I got, we use them to create a vision for the company. After we had created a vision, we started with a strategic work. And during the strategic work, it will also became clear rather soon that the plan -- planning or the project of building a new greenfield plant was not going in the right direction. So we had issues with the permitting process, but primarily, we were not able to get or there was a lot of uncertainty around the power supply of the factory. So we built in to do a reassessment also of the factory when -- or the plan of building the plant in the strategic work and in February, we also came to the conclusion. It was not the right decision to proceed with the greenfield plant and we also communicate that to market. After that, we have continued with the strategic work. And today, we are launching the strategies. We do it both here with you as well as we're doing that internally in Cloetta. So tomorrow, we're actually going to have a short town hall informing about the new strategies, and then we start the rollout of the strategies. And I know there has been some discussions about the plant, the greenfield plant. So I will come back to that later on in the presentation. But I must say, I'm really proud of the work that we have done. The team and I really feel confident that we have the right plans going forward. So this is really exciting to now be here to get the opportunity to present it for you. So I'm super excited. We are entering into a new chapter where we are launching our new vision, and that is to be the winning confectionery company inspiring in more joyful world. And what do we mean with winning? Well, we are Northern European leading confectionery company. So for us it's, of course, about keeping that position. We don't want to loose that position of being the leading confectionery company but it's also about for us to be able to grow, then we need to win. So we want to outperform the market. We want to be the top brand, the top employer and the top investment. And when -- and also, we want, of course, to embrace the winning culture in the team. And then, of course, what is the confectionery company? For us, a confectionary company is what we come from. This is our roots -- Confectionery is our root and the very high nature of the impulse it means with confectionery. But it's also about what is the next generation of confectionery. And of course, we want to be part of that journey and also maybe stretch our brands, our really lovely brands into new categories. And then we have -- we want to inspire in a more joyful world. And we want to be the expert in what things that sparks choice in people's lives. And I'm so proud of the team actually this week, we launched the report, the Joy Report, Cloetta's [ Q4 ] report, and we have done that together with Ipsos to Sweden. And you can find copies here and you can also -- for you who are online, you can download it from our web page. So this is really a great step in our vision that we want to inspiring a more joyful world. This morning, we sent out our new financial targets, and they are, of course, reflecting our vision and our strategies. So we are increasing our ambition from previous target when it comes to our organic sales growth from 1% to 2% to 3% to 4%. We keep our target to reach 14% EBIT margin. That is our long-term target. So these are our long-term target, but we're also committed to reach 12% by 2027. Historically, we have a leverage around 2.5%. The last quarter, we have been below 1.5%. Considering our strategies and our ambitions, we will strengthen these targets as well, and we will be below 1.5%. Of course, if there comes like a really compelling M&A, we will adjust the ratio for a time being, and then our ambition is to deleverage and come back to this level again. But this is our long-term target to stay below 1.5%. And then also the Board, we have updated our dividend policy. So before, it was 40% to 60% of our profit before taxes and now we are saying we want to be attractive to invest in. And we say that above 50% will be our updated dividend policy, and that is profit before taxes. So it's a pleasure to be here and tell you about the incredible journey of Cloetta. So Cloetta is Northern Europe's leading confectionery company, but it has been on the market for 160 years. And of course, we want to ensure we stay for minimally 160 more years. We have founded, as you saw in the video, in 1862 and go moving from a small confectionery company to the northern part -- today in northern part powerhouse in the confectionery industry. I would say the success has been from the very, very start where it's built on joy. And we have a purpose that we believe in the power of true joy. And that we -- it's reflecting in everything we do. We operate in 11 countries and we have -- or I have 2,600 colleagues around the world. Today, we are launching what we call our super brands. Our super brands are scalable, and they are more than 50% of our total turnover. I will talk to you more about this. Our net sales 2024 was SEK 8.6 billion, and we had a profit of 10.6%. So the target of 12% to 2027. It's a challenge, but is, of course, achievable. And we have since 2020, we have signed the science-based target, where we have a commitment to reduce our carbon footprint by 46% 2030. We are today in 60 markets as we were mentioning, but there are 5 markets where we call that are our core markets. And it's Sweden, Finland, Denmark, Norway and the Netherlands. And the common thing for these 5 markets is that, yes, Cloetta has been there with the brand for more than [ 100 ] years. They've been there for 120 years at a minimum. So we are very well known with our brands in these countries. We also have a market-leading position in these countries. And together, they stand for 81% of our turnover, so they are significant, these 5 markets and 19% comes from outside our core markets. We act today in 2 segments. It is Branded packed products, 72% of our turnover, and that is -- what it said products, packaged branded bags, so to say. And then we have our Pick & mix, and that is 28% of our turnover, and that is where the consumer is picking their own favorite candy and put there in a bag. You have an expert who are in the room. We have an example here in the room where you can try to do the Pick & mix experience. Pick & mix as a category as a growing faster than the packed business. Looking at the packed business divided into 4 different categories it's candy, it's chocolate, it's pastilles and gum. And it is really a strength for us to be in different categories. Because as you remember, last year, for instance, the chocolate price was up quite a bit, and we were able to navigate because we have different -- we have a broad portfolio where we can play within and also the consumer can pick from. So that is a very key strength for us. Also now we see the consumer looking more for Pick & mix. We have a broad portfolio we are offering. We're saying we are a Northern leading European market and that means we are the top -- one of the top 3 player in Nordics. But it's quite interesting to see because if you look at each market it's very clear, it's not the same competitor in each market. So if you see in Sweden, we have the competitors or peers, we shouldn't maybe say competitors, but it's Fazer and Modelez. In Finland, it's Fazer and Orkla. In Denmark, it's Haribo and Toms, and in Norway it's Mondelez and Orkla. And that gives us, like looking at all these markets, we are the only one that are 1 of the top 3 players in all market. So this is a strength. And we're also really proud of the broad portfolio we have in all the markets. If we're looking at what position we have in the market. So this is our core markets, as we mentioned, the 5 markets. Candy, that is our largest portfolio #1 or number 2 in all the core markets. As I said, these products -- or this brand, not the products, the brands, really. Has been on the market for many years. So they are loved by the consumers. In chocolate, we are only playing actually more or less in the count line segment. But still, playing in the countline segment, we are still #2 in Sweden, and #3 in Finland. So we were as well. And in pastilles, we are #1 in Sweden, Finland and Denmark. So having a position there. Gum, we today only have in Finland and the Netherlands, there, we are #1 and 2 and Pick & mix, we are really the top player in all the markets where we exist. But what is also interesting to see in this one, there's still some white spaces for us, which is also quite exciting. We have many customers, and we have divided them into 3 segments. So the largest segment is grocery. There you find like those traditionally where you go behind, you're shopping your everyday food. So in Sweden, for instance, ICA, Axfood, Coop, Lidl, et cetera, in Denmark and Norway, there's Rema. We have in Holland, there's Alberta and Jumbo and so these are the biggest part of our customers and stand for 72%. And then we have the wholesalers, that's more like business-to-business sales. And then we have incremental channels that's quite exciting because these are customers whose usually don't have their grocery as the main business like IKEA, like Normal and Apotea and so on. So there are other kind of business. But because we are such a high impulse nature it is a great incremental sales for them. So they like to have it. This gives extra on top money for them. So we had a very good business with them. We also -- all the online e-com players, we also put in this bucket. And looking at this picture, it's really the -- we have stable good sales in wholesales and grocery, but incremental channels will grow more than double digits. So it is a really interesting channel. And it's also good that we have this broad base of customers because it is -- what you can say, it is stability. We are not like if one customer had problem or so on, it doesn't rock the boat because the broad and wide number of customers makes us stable and resilient. So it's very good for our business to have it this picture. So now I'm moving over a little bit more to about the market itself, we operated. So this was more about Cloetta, now in general about the market. So quite exciting. It's actually this slide. It is, of course, only growth. But if you look at the bottom, you see a 1% CAGR. This is the volumes. This is what happened in confectionery category. So it grows 1% annually as a machinery, 1% is very much driven by consumption per capita. So it's growing in line with the population. If you look on the top graph. There you see post-COVID an inflationary shock, so to say, the inflation went up, 7% because raw materials saw went up. But till, you see on the bottom line is still the volume going. So the consumers, they really love this category. They -- even if there are some prices that has been changing, it's still a growth 1% annually. Of course, there's a little bit of shift in the volumes pending on trends and so on. So for now, for instance, we see a little bit more Pick & mix, if the chocolate price is going up, the candy goes up more and so, but still there's a 1% annual growth. And we expect that to continue. We expect also the inflation to go down a bit. So it's going to be around 2% annually in value, the category will grow per year. And what we can say also about this picture is that confectionery is growing about 1 to 1.5 percentage points more than the food in general, fast-moving consumer goods. So if you look an example, 2024, confectionery grew by 4.4%, moving consumer goods in general grew 3.3% and Cloetta grew 4.7%. So to get a little bit of correlation around this. Last week, I must say, it was a report called World Happiest Report that was published, and in this report, it was very clear that the happiest people in the world lived in Finland, then in Denmark, then in Iceland and then in Sweden. And I don't know if it's a quite incident or not but these markets also have the highest consumption of candy in the world. So this is, of course, super exciting for us. If this core market, as we said, we see this is, of course, interesting, and this is an interesting market to continue to work on. And looking at the market size, Sweden is about 1.9. But the largest market is in Netherlands, in our core markets and the smallest one is in Norway. Understanding the market dynamics is, of course, key for us because if we want to continue to exist for another 160 years minimally, we also need to understand the consumer and market dynamics. So if we look at the consumers, and you saw the 1% annually, we know consumers they seek indulgence and joy, this is something people want to treat themselves. So that we believe we will continue. But we see some shifts in behavior. So for instance, there is certain demand for individualization. There we have, as we said, the Pick & mix concept. Consumer, they want to pick their own mix of candy. We also see some increase in health consciousness and also there is an expectation that the product should be sustainable. It's not like you're willing to pay more from that. It is just expected that the product should be sustainable. We also see there is a desire for innovation. We need to constantly innovate because we want to be excited and test new products. And also, we see a little bit of change in snacking habits, moving a little bit more to healthier kind of snacks. And we also see, and I think that is no new news, of course, is the online. Everybody is online, especially the younger generation and digital transformation is increasing in speed. When it comes to regulation, this is something, of course, we need to be aware of and act accordingly. And that is, of course, the regulation is also to understand their role is to improve the public health and drive the sustainability. And what we see is now there is an increased focus on sugar taxes in some countries see they're doing some promotion limitation where in some cases, you can't have a cartoon, for instance in the pack and so on. And we also see for them to -- for us to drive sustainability agenda. We get some environmental fees and so on that all companies have to take care of. And then customers where we see their as mentioned. The incremental channels are growing. But at the grocery that there's also a movement that more hard discount is growing faster within grocery. We also see there are some in-store changes. They look how they're promoting the products differently in the stores. We also see their online sales is increasing, and they have a little bit of an issue get this efficient, so they work on to getting that efficient. And they also demand that we should be sustainable. So that is your request from our customer. You should be sustainable. And then, of course, there's a push on price they want to compete on price, but at the same time, they need the volumes to create the scale. So this is a little bit of the environment how the consumers are acting. And of course, understanding these market dynamics is super critical, and we need to adapt our strategies and our innovation according to this. So in summary, about this first part. So we are the Northern European -- sorry, no I think I need to fix with my mic. There? [Technical Difficulty] Okay I thin we are up again. We are Northern Europe's leading confectionery company and we had the vision. We want to be the one to inspire to a more joyful world. We are on a noncyclical market. As I said, there is a very stable consumer demand, and we are outgrowing the food, fast-moving consumer goods. We have a market-leading position in our core markets, and we have some iconic brands across in diverse categories and we also have this strong and diversified customer base that we're really proud of that make a consumer end market dynamics, and we continue to innovate and adapt accordingly. So how do we capture on these opportunities in the changing market environment. And now it comes to our strategic framework that we're now going to present more about it during the day. So we have our vision that I mentioned several times, but we have also made 3 strategic priorities. And this is very much about focus. It's about -- So yes, thank you. Yes. So our 3 strategic focus area. And I think the key message here is about focus. We want -- we don't want to run all over the place. We need to focus to be efficient and also to drive the profitable growth. And the first one we are saying we want to win with our super brands in our core markets. I will go through how we will do that. The second one is we will grow beyond core markets, but we will do that in a very focused way. So we are planning to do this on U.K., on Germany, and we will leverage the demand for Swedish candy in North America. And the third one is that we will accept sell in marketing and innovation to also be forward leaning and meeting the changes in the market. We [ have put ] as an accelerator, M&A. We have been driving organic growth in the last 7 years. We haven't done any M&A in the last 7 years. It is not like we're opening now Pandora's box and going to do every M&A that occurs on the market. It's about selective M&As. It's about, we find companies or prospects with the right that make business sense, that is we can find synergies and of course, they will accelerate our strategic priorities. And they are not part of the financial -- long-term financial targets. So they come on top. But we believe if we find the right prospect, this will accelerate our agenda to drive profitable growth. And then, of course, we have some enablers. We're going to enhance our operating model. I'm going to go through that. And then, of course, what is the company without the people in the company. It's just a black box. And of course, we need to leverage the future, the people and the culture in our company. So now I'm going to go through about our win with our super brands. That is our first focus area, our first strategic pillar. And starting first, what is a super brand. I think that is something. It is a new definition that we have created. But of course, these are brands that are -- have been loved by consumers for generations. These are not like just a fly coming up and going down again. This has been on the market for -- some of them for over 100 years. But they are really loved by consumers for generations and because they have a unique proposition, they have unique products. For us, they should have a turnover of minimum EUR 15 million. They should have multi-market presence and there should be multi-market opportunities. They should, of course, be scalable. And for us, it's also important to have a higher gross profit than average portfolio because if we grow with them, this will drive profitable growth. And they have already -- they are already successful. So in average, they are growing twice as fast as our -- the rest of the portfolio. So we have identified. For us, it's 10 super brands, it's 7 in chocolate and candy. It's 2 in pastilles and gum and then is 1 in Pick & Mix. And of course, these are our jewels. These brands are super important for us. We will continue to ensure that they stay relevant for the consumers. We will stay close to the heart and soul of the consumers and we will also innovate and find new exciting products in this. But really to leverage and speed up the growth it's about an expanding strategy. And this is about we're going to expand distribution in our core markets with this brand. We're going to expand these products -- these brands into new channels, and we're going to also expand them into new categories. And I will take you through this, and I will also give you some examples. So I start with the candy and chocolate. So we -- first, we go through the super brands, candy and chocolate. Then we're going to take pastille and gum and then Pick & Mix. So if we look at the candy and chocolate super brands, I hope you recognize some of the brands. So it's Malaco, Red Band, it's Ahlgrens bilar, Gott & Blandat, Juleskum, Kexchoklad and Tupla. And together, these brands stands for 59% of our candy and chocolate portfolio in core markets and the other brands. And we should also -- these are local heroes. We will, of course, not say, oh, we discontinue all, those products in these, because they are also loved, and we have a lot of loyal consumers in this area. So we will also continue to take care of those brands, but they will not be as significant supported as our super brands. And here, we come a little bit of a busy slide, but these are the opportunities where we see according to our expanding strategies. So if we look into where we can go in core market. So for instance, Ahlgrens bilar, we have in Sweden and Norway, but we see an opportunity that we can leverage this in all core markets. And if you look, for instance, for Finland, Ahlgrens bilar exist there today, but only with 1 SKU. So the brand, the consumer knows about the brand. They have seen it in the shelf. It's not that we have to launch a completely new brand because that costs quite a bit of investment, but we will leverage on what we have to and do much more with it. So this is the kind of strategy. They usually are already in the market, but it's a very limited distribution. It's a few customers. There is an awareness of the brand, but it's an opportunity to grow. We also see these products, they have -- these brands, they have a very high impulse nature because they're so loved by the consumers. And again, as I mentioned, the incremental sales we can get. So when you're shopping at a furniture store, when you come to the check out, you grab an extra box of Läkerol and so on. These kind of opportunities are there and we haven't grabbed them all and this is something we need to -- we will continue to focus on. And the last one is then how we will expand our loved brands into new categories. And to make it more visible, I will make an example of each of these strategies -- expanding strategies. So this is an example, actually, of Kexchoklad. I think if you are here in Sweden, most of you have heard about Kexchoklad, it's actually the most sold food product in entire Sweden. So no milk, nothing else. It's Kexchoklad, who is the #1 most sold product in Sweden. And it is a success. The yellow color, the checkmarks, connecting it with skiing and an active lifestyle and so on. We have really built a strong brand here in Sweden, and there is a high consumer demand for this product. In Denmark, it exists -- existed, had a few customers. And the only way it was activated was with some doing some discount. So very small sales. So what we did, we took the brand proposition and marketing material that we have already developed in Sweden and launched Kexchoklad in Denmark, relaunched, so to say. And we created a consumer demand. We increased the listings. There, we didn't have to do the promotion to get the trial and we have actually doubled the turnover in activating the brand this way in Denmark. And I will just show TVC that we are now going to also go in Denmark that we have done in Sweden. Maybe you recognize it. [Presentation]

Yes. And then we have the next one. It is actually quite amazing because we have Christoffer here today, and Christoffer is actually the daddy to this campaign, and this is where we took Juleskum, a seasonal product, also very loved in the Nordic markets. And we said, okay, let's see -- to create incrementals. And there, it was created a pop-up store together with foodora. Foodora is the leading [ qcom ] company in Sweden. And this was also quite amazing. We got some -- of course we reached a new target group, younger that it was more like triggered. Actually we sold also like underwear with Juleskum. That was almost the best sold out item, but it was really a nice success, and we also become the supplier of the year at foodora because we did [ ads ] campaign. So it was really creating some extra sales. And then we also have this one, and this is about going into a new category. Here we took the beloved Tupla brand in Finland, and we launched it into ice cream. And it has been such a success. We got really good listings and really good visibility. The team is already developing new products in this area. And actually this launch, it added 6% incremental sales to the Tupla brand with this product. And this we did together with the partner. So it was a licensing. It was not that we start to produce ice cream ourselves. But they're really interesting and nice success. And now we're going to move over to pastilles and gum, and I've been talking so long. So it's really good that we talked about pastilles and gum. So I will get the opportunity to take a little bit of a ZipMint and you will watch a little bit the movie about this interesting category. [Presentation]

Yes. So now we're going to talk about pastille and gums. And this is a really interesting category for us at Cloetta because it is actually our most profitable category. And what we see is also you know the 1% growing per year in confectionery. This one is estimated to grow 1.3%. So a growing category and profitable for Cloetta. We have 2 brands that's important for us and our super brands, and that's Mynthon and Läkerol but we have other brands that are really good and strong also in this area. Pastilles and gums, especially pastilles is our strategic hero. This is an important category for Cloetta. Today, Mynthon, Läkerol stands for 48% of the portfolio and the other brands stand for about 52%. So one of the reasons why pastilles and gum are all so interesting for us is also is very well placed for the changing consumer market dynamics. So if you think, for instance, Läkerol, you see here in the front, a bigger size. But usually, they're quite small boxes, they're sugar-free and you have a very long-lasting nice taste. That is really for maybe the health conscious consumer who doesn't want to -- wants just to have a small permissible treat. This is a perfect match. And then we have also, as you saw in the beginning of the film with the xylitol. Xylitol is an ingredient that has been approved by EU and European food and safety authorities where we can do health claims. This is something Cloetta has been the very first in. It has a health benefit because it's very good for your teeth and this is something we can claim. This is something we can leverage. And we have a couple of brands and products that contain this xylitol. This is something we can leverage. And then as you saw in the commercial, in the beginning, we also have the functional benefit, especially after you may be drinking some coffee and so on, you want to fresh up your breath, then you have a nice little mint that could create some nice refreshment in your mouth. Pastille and gums, we will also continue, of course, to work with these. These are loved brands. We continue to work on them. We continue with innovation, but we also have here the expanding strategies. So Mynthon, for instance, is today strong in Finland. Very strong in Finland, and we have a little bit also in Norway. Here, we are now rolling out in the rest of the Nordic. Läkerol, we are strong in the Nordic countries. We have a little bit of presence in Holland. We believe we can make it stronger and bigger in Holland as well. And this is also about expanding into new sale channels. It is also very important here. And here we also see we can do more with pharmacists, especially with xylitol. There is an opportunity here to grow further on this one. And then I would just -- would like to give an example. You saw the movie in the beginning, and that is about this ZipMint. I think you have it in your goody bags and also on the tables. This is this fresh little mint that is freshens up your breath. We took it. It has been in Finland for several years. We have taken it. We have adapted it to Scandic and now we have created like one set of material and we're rolling it out in the entire Nordic and it's in a very early stage. But so far, it's really promising. I think one customer went up to #1 sale side like the first 2 weeks in the refreshment area or the pastilles and gum area. So really successful first start in this. Then we come into the last segment -- super brand and that is CandyKing. This one, Niklas, will talk more about the Pick & Mix, so I will not try to steal the thunder about this. But if we look at the Pick & Mix, we divided it actually into 2 segments also. So about 75% is what we call the concept. And the concept you see here to the left for you who are in the room. It's about -- we are having the fixtures, we have the products. We have the bags. There are merchandisers who come and fills up the products. So it's really about selling a service of candy where you can pick it yourself. The other area is more what we call, it's our branded packed products where we -- that we sell as bulk. So you can also pick that. And that is primarily Sweden. So 75% is where we are offering the full concept and the 25% is where we only offer the products itself. As has mentioned several times, Pick & Mix is on consumer trend because we see this is the fastest-growing category in the Nordic. It is really growing faster than anything else. And it is about the consumer that they can pick their own choices, but the retailers are also quite fond of it because it gives them the opportunity to do something special with their stores, to give the shoppers inspirations and experience in stores so they also want it. And if they get the CandyKing concept, then we take care of everything. So we look -- ensure it looks really nice in the shelf. There are nice signs and so on. And also, as I said, the market has been growing since 2020, double digit every year. It went down during the pandemic, but 2022, it was up at the same level as before the pandemic. And what we're going to do here with CandyKing, we continue, of course, to increase the penetration. We do that in investing in the brand, and we also convert more and more stores into the CandyKing concept. As you saw, there was a white space with CandyKing. We are #1 in Pick & Mix in all 4 of the 5 core markets. So there's a white space in the Netherlands, and there we are now planning to launch CandyKing as well. And then we have also done a very successful launch, where we have done prepacked Pick & Mix for the e-com. And that has worked very well. You see you have sample also here in the room. It works very well. And now we're also planning to work more with this, expand this. So in short, we have 10 super brands, really important for us in the core markets. This is where we're going to grow. This is how we're going to reach the 12% EBIT minimally 2027. And our long-term ambition is that we have more than 50% of our super brands today coming from these 10 brands. And the ambition is that we will increase this to more than 60%. So that was the first strategic focus area. This is how we're going to win with our super brands. The next one is, that we talked about growing beyond our core markets. And I think this slide tells quite a bit of the story. We have 81% today that is our core markets and 90% of the sales is outside of core markets. But if we look at what is outside these core markets, it's 5% U.K., 7% Germany, 3% in Canada and U.S. and 4% on 50 other markets. Looking also, going back to the consumption, the happy people in the North, we have high consumption of candy. And looking also in Germany, U.K., especially Germany has a high consumption as well, is on 12.1 kilo and U.K. on 9.7 kilo per capita. And also looking at the market size. So we have today 5 core markets. If we add U.K. and Germany, we reach more than 50% of the total confectionery market in Europe. So by focusing on 7 countries, we will reach more than half of the European confectionary market. So that is our ambition, of course. And it's also -- we have already 7% of our turnover in Germany. But we also have brand. You know Red Band as a brand has been on the market since the '60s. It has high brand awareness in Germany. So it's not that we have to create something new. But the focus historically has been on wine gum and liquorice. And we have been focused on distribution in the North and the West. And by taking the Red Band brand and do it bigger to launch more products under this -- more concept under the Red Band, and also what we're saying is to we have the CandyKing. We have the repeatable model to do a test and see if this is a demand. We have already a customer asking for Pick & Mix concept so we believe there is a demand for this in Germany as well. And we also see there's an opportunity to launch pastilles and gum in Germany. And it's also about -- then about we create a winning portfolio, and then it's all about to ensure that we get the distribution. So we are today in the north and West to secure that we also get the east and south of Germany. It's about building distribution and also that we continue to work with incremental channels, as we have said, for instance, e-commerce. And here, we see like the coming brand that we will focus primarily on in Germany, Eastern and Red Band, also a brand called The Jelly Bean Factory and CandyKing. Looking in U.K. We also have a brand there from the 60s, it's called Chewits and it's 5% of our turnover. Historically, the last 20 years, the focus has been on CandyKing to launch -- to work on CandyKing in U.K. And we also have an organization. We have quite a big organization with merchandisers and so on in U.K. And we believe there is this really an opportunity we should grab and that is in the packed business. We have -- it's really -- Chewits has a high brand awareness. Has been on the market since the 60s. Most consumers in U.K. know what it is. We should expand this into new category, use the brand and sell it and expand into new category. We also should revamp CandyKing because it's a little bit drifting versus the other market, in the core market. We need to ensure that we are as successful in U.K. with CandyKing as we are in the other markets, in the core markets. And there, we also see an opportunity to launch pastilles and gum. And here it is also about distribution game. Distribution, distribution, ensure that we get distribution at all the retailers in U.K. and so on. This is super important to be winning also in U.K. And then today, we have a small business in Canada and U.S. I would say that our Canadian business is slightly bigger than the U.S., but we also see -- and we are selling primarily Jelly Bean and some products under the Red Band. But we have seen increased demand of the Swedish candy, especially in the U.S. and we see this as an opportunity. We want to understand more about then we're going to -- we are planning to do this, but we want to do it in a secure and good way, of course. And there, we have the CandyKing concept we believe, is something that will be very appreciated. It's really delivered on the Swedish candy trend. And we will start the pilot. We will do that in the New York area to ensure that we are not doing pilots all over the country. We do it in an isolated way as a start to see we are successful there. We are going to work primarily with brokers, and we also have -- we will do the offerings through Amazon. We have a good business today with Amazon that we will continue to work on. And then of course, we had some Swedish super brands that could be launched also under pack. But the Swedish candy trend is mostly Pick & Mix linked. But there is a brand called Swedish Fish, it's not our brand, but it's quite big. And it could be an opportunity to, of course, to leverage from the Swedish there as well. And then the next priority, the third priority, and that is to excel in marketing and innovations. We have, today, created a very efficient marketing model. It's about in a cost-efficient way, ensure that you reach as much consumer as possible. And this is very much linked to that we are data-driven, but also that we have worked a lot of how to understand how the consumers consume their media. We also have -- and this is something that we believe that we now can take to the next step because this is a really good base for us to build our -- the coming years upon. We will use it now and we win with our super brands where we're going to create scale in our content and instead of having different markets, developing different materials. We have -- we do it in a common way. And then instead, we invest more money to be used in consumer-faced media. Because that the consumer sees and that creates also demand and that creates sales that drives our top line. And then, of course, we also -- when we do the NPDs, it's about to do the margin accretive NPDs. So we focus on NPDs in this area also to stay relevant and interesting for the customers. And then as we have created such a great marketing model. We will take this now know-how and use it now when -- especially when we're scaling up in U.K. and Germany. So this is, of course, very important to bring with us. And then as we said, it's a changing consumer and market dynamics. We need to be prepared for the next generation, what is happening. So we're going to accelerate our innovation. We will step up in this area. And I am super proud and happy that we are now taking the initiative to start a program that we call the Cloetta Next that will really embrace the speed, our passion to be relevant for the consumers and our ambition going forward. I will not steal all the thunder around this because this will be Thomas who will present this later on in his presentation. Then I am just going to shortly talk about the selective M&A that I was mentioning in the strategic framework. And this is -- as I said, this is -- it must make business sense. We are going to evaluate, if there will be, like, for instance, a company for sales in U.K. or Germany that will help us to get the distribution up and get us to have more shelf space. So that is one area where we will look into if that could be a good opportunity for us. The next one is, especially in pastille. This is a strategic focus area for us. If we can even find a new super brand in this, this will, of course, be interesting. So pastille is another area. And then as we said, we need to be prepared for the next generation confectionary. And if there will be a company, we found interesting, a good match that will be making good business sense, that could also be interesting for us to do M&A within. So that is a little bit the framework how we look at this. And then I'm going to talk a little bit about how we're going to enhance the operating model, and this is for us to support the profitable growth journey, of course. So we see this as the 3 different areas. So the first one is the margin profit through what we call an NRM. And that is very much about -- we mentioned before, when we launch new products, it should be margin accretive, but it is also how we ensure the promo optimization, take out like unprofitable small volumes that only create complexity and really haven't harmonized portfolio. Frans will later in his part also talk a little bit more about how we work with this. And the second one is what we call the supply chain fit for purpose. During the reassessment, when we did a strategic -- we looked into the strategies, and we also reassessed if we're going to build a greenfield plant or not. It became very clear that we can improve quite a bit in efficiency and productivity in our network. We have to do it in a disciplined and focus way, but there are opportunities. We also know, and Frans will also take you through about this. We will do step up in the CapEx. And this is to create efficiency and capacity, but also in capabilities. So this is also part of our -- to ensuring that we have a supply chain fit for purpose. And then also, we know the whole market. Consumers are shifting. There's different trend we see and this is also -- we need to stay agile and depending on consumer demand and so on. And this is also one of our strategy will be. Should we produce it ourselves or should we buy it from outside. It could be a component in our products or it could be the whole product. But this is something to increase our flexibility and for us to be more agile when it comes to our supply of our products. So this is part of our creating a supply chain fit for purpose. And then it's about, of course, creating an effective operating structure. We have now strategic priorities and we need to ensure we have resources and focus on those strategic priorities. Because it will never happen if we don't work on it, of course. And this is one of our goals that we will do this and we will also increase the operational efficiency by doing this. We also will optimize our processes. We have, for instance, an integrated business plan. This one, we can do more efficient, and this is also something we will optimize. And we also will, of course, enhance the speed and agility. And one of those is like what we mentioned, the Cloetta Next, where we organize also in a slightly different way to get agility and speed in the organization. Coming back to the greenfield that we stopped this project, I think, it's important to remember why we were supposed to do it. And of course, the reason why we once said we were going to build this factory that it was that we wanted a new production capacity. It was an EBIT uplift by efficiency. It was also part of the sustainability journey. But we should also remember, it was the single largest investment in Cloetta's history. During the strategy work and the reassessment, it became very clear there were increased geopolitical uncertainties. The power supply was not secured to the factory, we also see in the strategic review that we need the production flexibility driven by the changing consumer market dynamics. And this is important. We can find the capacity and the EBIT opportunities in our own and the 3P network. So that is in short about the greenfield. And then also, just to mention, we mentioned several times the sustainability is important. The consumer request it or they just expect it. The customers expect it and regulatory demands. So this is something we have to deliver upon. So we have joined the science-based target. We did that in 2020. We are committed to reduce our carbon footprint by 46% by 2030. We have also -- I'm also really proud that out of reporting perspective, we have already started to align our reporting with the CSRD so that we are on top of. And just how we work with it. We look at sustainability out of 3 perspectives is for the people is for the -- for you, for the people and for the planet. And we have different programs how we work with these different areas. What I just wanted to say, for us to really, we act in those areas where we have a responsibility to act and where we have the ability to act. So we have this under control, so to say. And then the last but not least is, of course, what is the company without the people and what is the culture we are striving for. So we have a vision, and of course, for us is also to create a culture where we have a winning and joyful culture. And this is also about to attract and retain talent. Also with the strategic focus, we also need to create clear roles and responsibility. So everybody knows which area in the strategy to focus on, of course, and we will also increase the focus on performance. We have been performance driven, but we will now do it through a new method -- for us a new methodology, sorry. And it's called OKR. I don't know if you heard of it. I have worked with it. It's for me, it's about setting common goals for the company and their teams that really creates alignment in the organization. So that is the thing we look forward to do. And I'm also convinced and committed to have one common vision, have one common strategy that will, of course, create good alignment and engagement in the organization. So I'm so happy about that. Summary. So 3 focus -- strategic focus areas, and that is super important for us that we will keep our -- all our focus on, is this is about our winning and with our super brands. We have 10 super brands that we will focus on and secure that we win. They are key enablers also for us to deliver the 12%. The second one is to grow beyond core. And there, we have taken the decision. It's about U.K. It's about Germany. It's about exploring North America. And then we will excel in marketing and innovation and that we will do. We will continue to work on the marketing effectiveness, and with scaling our super brands, and we will work with exciting product development. And then, of course, we will achieve the operational excellence and that will happen through net revenue management, the supply chain optimization as we talked about and an efficiency-driven organization. So that was my long speech. I'm happy you're still sitting in the room. A lot to talk about. And now I'm going to hand over to Thomas who will talk about how we will excel in marketing and innovation.

Good afternoon, everyone. I'm very, very happy to be here and very excited to talk more about marketing and innovation. I know it's been a lot of information. So I hope like between now and the break, approximately 20 minutes, I will talk about that. And I hope it is going to be very exciting information for you. But Thomas Biesterfeldt I said, I'm CMO. So I'm responsible for marketing, innovation and sustainability at Cloetta. I joined Cloetta in late 2018 and prior to this, basically 20-plus years, FMCG experiences in companies like British American Tobacco, L'Oreal, in different countries, basically focusing a lot on consumer centricity, valorization and brand excellency. That's also really what everything is about for us at Cloetta. It's about the consumer. And we put the consumer at the center. That's why we call this consumer centricity and with consumer centricity, I would say it starts and naturally looking at trends. Because trends are kind of the articulated clustered opinions and perception of consumers. So let's take a look at 6, from our perspective, relevant trends for Cloetta. And the first one what we call searching for joy. I think when we look around today, we see that a lot of things are changing. Things are moving fast, there's quite some insecurity around us. When we nowadays look online, we don't know whether a picture is for real or whether it's made by AI, a lot of insecurity. And there's a phenomenon what researchers call high-tech high-touch. So meaning the more technology around us, the more we are gearing towards things that gives us security. So we are looking for joy in the small things. I think it's fantastic to say that this is an area where Cloetta has already been delivering products and catering into these occasions for decades. And it is not something that we expect to get less. So that was one of the reasons and Katarina mentioned it. We have launched a joy report basically also to understand and share with the world more around the theme of joy. These occasions, we basically can impact. So we create moments of joy. But always, as with trends, it's a bit strange. Sometimes they're almost like working against each other, like at the same time, consumers mention they love new experiences. They look for new experience and change. And obviously, not only hyper individualization, hyperindulgence and that's something we need to manage, but at the same time, innovation is really at the core of our business. And with Pick & Mix, we have a fantastic answer to personalization and shopping trends. Consumers look for products, they support a healthy lifestyle. Yes. And it's very good for me to say that already today, almost 1/4 of our portfolio is sugar-free. And we have further products that have reduced sugar, like to mention recently launched Chewits Jewels in the U.K. compliant with HFSS, the new rule in the U.K. But also, it is important to mention, if we look at what consumers say, we would expect that this category would already be much bigger, but over the past 2 years, actually declining on the level of 2% share of the market. But nevertheless, we will be ready and we are ready to accelerate when the consumer is looking for this even more. The fourth trend, and this is very important from a marketing point of view, consumers are connected and they are connected all the time. We have trends that are built through communities. Communities that are moderated even by AI or virtual YouTubers. That's the reality today. We need to understand the marketing, which of these trends will really live and which are the trends we should not look into too much. Also, it's very important to be effective in marketing in our spends and in the consumer-facing media. We will come back to it. Then the shopping experiences and overall convenience is something that has grown over the past e-commerce, for instance, or quick commerce nowadays are some examples of the convenience trend, and we have all reasons to believe that this will continue. And then I think I won't even call it a trend, but it's a hygiene factor. We mentioned it before. Consumers expect nowadays companies to be ecologically conscious. And as Katarina mentioned, we have signed up to our climate action plan with the science-based target initiative but also we have initiatives such as less and better plastic with plant pack or that we're removing, as we speak, the plastic wrapper on the liquorice boxes as one example. So how do we capitalize on these trends in Cloetta. We said like, we want to accelerate the marketing and innovations. And the teams have worked hard on this over the coming years to really build a fantastic foundation. The first thing is I mentioned consumer centricity. We work along a so-called 4-step consumer connection model. The first thing is we spoke about trends. We need to understand what is happening, social listening. Really have the ear on the pulse, what is happening. The next step is when we then talk about product, when we start to develop products. We are doing a full cycle research from the concept finally to the test products in shelf, et cetera. And actually, we have an own panel of 12,000 people that are testing our products, sensory panel, they tell us whether they like it or not. And if it's not good, back to the rework until it is really good. And then things like the joy report we just mentioned, research initiatives. Then when we have a product, obviously we need to understand that consumer needs change. So we want to stay the number 1 for these occasions of consumers. So here we see examples how we move candy in boxes. So you can bring them with them in your purse or we have the example of CandyKing moving in the prepacked. And then finally, it goes to the distribution. So go where the consumers are. And here, we follow the consumer, and we win with the winners, and we grow those type of channels and our activities there. That is number one. The second one, how we leverage on these trends is our marketing mix. And let me start by it's good to realize the category we are actually operating in. And I call it a EEE, everyone, every day, everywhere. Everyone is our consumer, everyday and can buy us everywhere. It's fantastic. It's not many categories that can claim that. But this is very, very important to understand because it has a lot of impact and imperative on our marketing strategies. Because think about every day, the consumers and the market. Think about categories like a car or vacuum cleaner for arguments like how many times do you buy a vacuum cleaner in your life, eventually -- well, unless you collect vacuum cleaners, but probably you do that 3 times a year. Then it's very important for the company to be there when the consumers are there. For us, consumers are in the market basically every day. That means in marketing, we talk about a media planning KPI of reach. And reach means we are trying to reach as many people as possible with the budget we have available. And that is a big, big difference than micro targeting consumers that are right now in the market to buy something. For us it's a different model, but the model is set up to be a very effective model if you master it. Because we are striving for availability, both in consumers' minds. When they come to the store, they should have a mental availability of our brands, but at the same time, they should see it in store. And when they work together, then really, the beauty happens. How do we work around this. We have a model that we call a marketing mix input model. That really starts with our advanced media guidelines that could for instance be, how do we build campaigns by building the optimal reach per age group and channel. You understand not every consumer you can reach through one channel. That's not possible. So you need to have the right capping frequency. Capping, when do you reach the consumer. When we go into the KPIs we adjust them if needed. We work with data and insight analysis, and then we work with partners like we do media mix modeling, where we understand like which type of advertising has the best ROI. I, for instance, can tell you, you saw a picture of Kex out-of-home advertising. It's very nice. It's very impactful, but we only do it very seldomly. It's kind of the cherry on the cake because it's a very expensive form of advertising. And therefore, not the most efficient one. So this is all things that we are working around with this model. And then thirdly, it is about the nonstop appetite of our fantastic consumers for news. And I make a difference by talking about either innovation or new product developments. With new product developments, I mean products that could be a new flavor. We see here like a whole strawberry launched last year. That's, for me, a new product development. And innovation is something that really creates a new segment or a new behavior. But NPDs in this category are absolutely critical. About 10% of this industry sales is done by innovation. And you will see like also because of the trade windows, et cetera, we have a lot of change of portfolio happening through NPDs. In Cloetta, we are quite well set up, and we worked very hard to get there. We have like -- 20% of our sales over the past 3 years are done by those type of NPDs. And in 2025, 50% of our growth is made by NPDs. And we have researched in Sweden over the past 8 years in the candy category, which type of innovations were able to deliver most incremental market share. And we outperformed with 50% to competition. So we're doing this well, and this is a well-oiled machine. But nevertheless, we have great opportunities going forward. You can imagine when you touch so much of your assortment through NPDs, it allows you to each time bring new NPDs that are accretive in terms of margin versus what you actually take out or cannibalize on. That's a fantastic opportunity because it helps you to renew your portfolio in a profitable way. And also, we work hard in sight to bring more efficiency through, for instance, a menu cards where markets can pick already ready product or SKU catalogs that gives us much more efficiencies. Good. So with that in mind, we have reached a point where we are in a position that this is also ready to scale to new markets. We have a very well-functioning marketing model. And Katarina mentioned the strategy to grow beyond core markets. Think, for instance, about the new product that we want to bring to a new market. We have consumer insights available because across our markets, these consumer insights are usually very universal. We have then a well-working positioning that has been tested and that we know will deliver. And we have a product at the end that has been tested either by the 12,000 people in our panel or external research. But by that, at the end, is very important is actually because we can save time, we can save cost, and we have a much better chance to bring quality and success to that new market. So it's really nice and a good moment to scale this. To go further from here, Katarina mentioned the strategy regarding our Superbrands. So think about we have now the consumer centricity. We have that marketing mix model that Cloetta marketing teams have perfectionized, and then we have the NPDs, a well-oiled machine. But now how could we with even more focus, drive forward and accelerate growth on those Superbrands? What can we do in marketing and innovation to support this in the best way? Our ambition is to become the undisputed leader for all or in each of these brands in their respective area of business. That is the ambition. And we have some very good marketing drivers. The first one, if we look at communication around these brands because in FMCG, we need to support our brands, we will bring more focus to our brands to those Superbrands. The second one, Katarina mentioned it earlier, if you do one content creation, but you scale this to several markets, you can understand that you utilize this type of content at the same time to several markets. And I'm actually very proud standing here that we made such a progress already since 2018 from 54% consumer-facing media up to today to 70%. And let me tell you, benchmarking and consumer FMCG, this is a very, very good number. But with these Superbrands strategy, we feel we can utilize the scale and bring it even further and stretch our consumer-facing media to 75%. So that means 75% of A&P is meeting directly to consumers. The other lever to drive efficiency is actually the product and the packaging itself because you can imagine for our factories, utilizing an already proven and superior quality product like Mynthon Zip Mint or like Tupla, which is also here in which we have done now, and we do it exactly with the same packaging and we do it with the same label. We can then move into white spots in new markets, and we do that and create scale, efficiencies and quality. But then how do we go forward from here? I feel, yes, we are very happy. We are very proud, and we really want to push these Superbrands to grow further. But thinking about the future, I thought like when I look at these trends, it starts to become a bit foggy. It's a bit difficult to say. So which of these trends in 10, 15 years from now will have relevance? Well -- and we are not making these statements, obviously, it's difficult to say. But obviously, we know that some of these trends or the combination of trends will accelerate. And this is really the ambition. We want to be ready for the future. We want to not miss any incremental opportunity for Cloetta. And we want to ensure relevancy for decades and generations to come. And therefore, I'm very, very happy also today to announce to you that we will start working with Cloetta Next, which is our innovation hub, a new organization muscle basically to say that will work in a different way with the objective to enable incremental growth, but also to ensure our future relevance. So the ambition is very clear with this. More value, future relevance and incremental growth. To reach this ambition, Cloetta Next, as an innovation acceleration program, will help us to achieve this by focusing on 3 areas. The first area, we're going to do things simply faster. We have to become faster. The world is moving faster. We want to become even faster. And we will do this through agile methods, prototyping, agile scrums, sprints. We will pick people from different teams to work in these teams and deliver prototyping faster. The second thing, not everything we need to do ourselves. Fantastic companies, fantastic minds out there to cooperate with. In a systematic way, we will work stronger together with the external world with existing and new suppliers, external manufacturers, but also start-up scales up that we can engage with Cloetta Next. And the third thing is that we will reinvent the future of impulse. What I mean with it is that we really want to look at with some of our top partners in retail, how can we define the future of impulse? How will consumers shop? What was 15 years ago, the biggest impulse in a checkout aisle, where is it now? One could argue it is maybe quick commerce. What is the next impulse in 10 years from now? And that is something we really want to be part of. So not only product but also distribution and being really a pioneer in this area. From this future outlook slide, I come to my last slide to sum up. And 4 parts I'd like you to take with you when you think about our new strategy and when you think about marketing and innovation, how we can support this. We will and first and foremost, and most important -- protect and grow our core. This is our business today, all the fantastic brands you have seen, the Kex, Tupla, the Mynthon. And we will do that evolving with the consumer trends. You remember, we spoke about the best-in-class consumer centricity, but also about the marketing mix and the efficiency of our investments. We applied on this know-how to secure successful entering into new markets. Superbrands. We will win with our Superbrands. We focus and expansion with maximum efficiency and the best quality to recruit consumers and outperform the market. And then fourth, it is about our innovation, our innovation strategy to reinvent how we do it and to bring simply more incremental innovation to the market to disrupt the market to be part and ensure future growth. Thank you very much for listening, and I invite Katarina and Laura back to the stage for a short Q&A.

Thomas, we are 3 minutes ahead of time.

Oh? The share price, I think...

No, the share price is up. So we have clearly delivered some good news today. Now we only take questions from the room, and I have reserved the first question for Nordea. And Cecilia on 1 side and then [indiscernible] on the other side over there, we will hand you the microphones. Sorry, please go ahead.

Adrian Elmlund here from Nordea. I'll begin with, I guess, 2 sort of questions. Just seem to have a lot of focus on marketing and the innovation spending here. Could you maybe develop a bit on how you kind of want to reach your margin target? If you maybe begin with -- as a percentage of sales, will marketing and innovation increase compared to historically? And how will you sort of reach the margin target? Is that -- if I understand it correctly, if you focus more on your top brands, is it more or less gross margin increase? I think you're moving from 50% to 60% of top line sales. Could you maybe go through how that impacts adjusted EBIT in sort of drop through, sort of?

Should I take it? Yes. No, Frans, he will go through this later on in the presentation a little bit more about how we -- what will come from the different areas in the profitability journey. But if we're looking at the first year, as we said, until the 2027, when we're saying we're going to reach the 12%, it is driven by the Superbrands. And as I said, they have a higher gross margin and they're more profitable than the rest of the assortment. So we're focusing on those primarily, and this will, of course, help us. And then, of course, what we said, we are also doing the net revenue management, the efficiency in the portfolio. We're looking over the supply chain, as we said, fit for purpose, to make that one more efficient. So that is also part of the journey.

To build on the point, it's -- today, we are at 7% of net sales for A&P. And the first, as I mentioned, the first enabler to invest more into our brand is basically making those investments even more efficient. But nevertheless, if you look at the FMCG average, 7% is still a little bit on the low side, but we feel we want to develop our A&P spend along our NSV growth. And we see already today, we do the focus when you look at between categories. There are some categories as focus categories. We might spend a little bit more A&P on than others. And so the Superbrands, the idea is to finance that by focusing and driving more efficiency through the more consumer-facing media.

Thank you, Nordea. Do we have any other questions from the room?

Hello, everyone. Niklas Skogman, also with Nordea. I can't tell, but think why you haven't tried this strategy before, i.e., moving into new geographies with your existing brands because you had these brands for a long time. And why now is the right time to do it?

I can maybe start answering, it's a very good question about -- from a marketing point of view. Maybe it starts with -- I want to put the attention to how the situation looked in 2018, where 54% of our spend -- marketing was simply not that efficient. We have worked very, very hard to trim it to the point where it is now. Now the teams have really built a model that we feel now it's time to scale that. I think it would be rather derailing if we would start to look too early to add new things, but we feel really now that everything is in good shape. We are ready to do that. And we want to do it like a well-trained athlete and not running into marathon without good training, that's simply the situation. So now we feel we have a good moment now, yes.

Excellent. Any further questions from the room today? Very good. Then we move on to the break. And as you might have noticed, we have our Superbrands here today. And we have Christoffer, where is Christoffer? Over there. Our Director for E-commerce, and [ Mortek ], who then also guide you through and tell you more also about that area during the break. But we'll see you back shortly. Thank you.

Thank you. [Break]

Warmly welcome back, everyone. I hope the break was both refreshing and joyful. It is now my pleasure to hand over to Niklas, who will talk through the Pick & Mix journey ahead. The stage is yours.

Thank you, Laura. So thank you very much. So my name is Niklas Truedsson. I have the privilege of taking care of the Pick & Mix business in Cloetta in addition to also running the business of Cloetta in Denmark and Norway. I joined Cloetta in 2019. And that's also when I started working with Pick & Mix. And prior to that, my main background is 6 years with Unilever, both in Nordics as well as abroad. But today, I will talk Pick & Mix with you. So I thought that given Pick & Mix is one of the things that makes Cloetta fairly unique, but it's also somewhat of an odd bird if you compare us to many other FMCG companies. So therefore, I thought it would be a good idea to make sure we're all on the same page, what is Pick & Mix and what are we talking about? And what is the role of Pick & Mix and why is it the key pillar in Cloetta's business? So I'll start about a short introduction. Basically, what Pick & Mix is, is that is when we run a retailing concept with Pick & Mix confectionery in retail stores. That means essentially that we procure and set up all the fixtures for the Pick & Mix candy in the stores. We managed the full assortment, which is a mix of Cloetta products as well as third-party products. We activate the category, both in-store through theme promotions as well as out of store through social media or advertising using our CandyKing brand. And we do all the servicing of the stores, which essentially means we go to these stores, maintain the fixtures and the hygiene routines, and we replenish all the products. So essentially, the only thing a retailer should have to do is provide the space for the Pick & Mix section and then charge the consumer as they go through the cash out. Now this model differs slightly between customers and markets, but in essence, this is how the model looks across. Now in addition to this, Cloetta also sell our brands and products to those retailers or, in some cases, competitors who run their own Pick & Mix operations. And that is when we get our brands and products, that's what we call in bulk sales to -- into other Pick & Mix sections as well. So as I said, Pick & Mix is a key pillar in Cloetta's business. And it's also a very strong competitive advantage for us as we strive to -- and our ambition to be -- to retain our position as a Northern Europe's leading confectionery company. And I'll break that down in 3 parts for you. The first one is around category leadership. Now as Katarina told you, Pick & Mix is by far the most growing -- the fastest-growing part of confectionery. And we're talking double-digit growth in both volume and value for the past years. And that is at the same time as the rest of the confectionery section has been either stable or even slightly in decline. So this means if you want to be a growing company in confectionery, you probably need to be in Pick & Mix. Now that growth, in addition to the margin it actually delivers for a retailer, makes this the most important part of any retailer's store in the Nordics. And in addition to that, a consumer spends around 2.5 minutes in average in front of the Pick & Mix shelf. And the only places in the store that can rival that is basically fruits and vegetables and the dairy section, which in itself means that the Pick & Mix section or what kind of inspiration you bring there will have a disproportionate impact on the consumers' quality impression of your store. Now all of this makes Pick & Mix a very, very important part for any retailer in our core markets, which essentially means that we, as Cloetta as the clear market leader in all 4 Nordic markets, in addition to our very strong position in all the other confectionery categories can have a dialogue and a relationship in a very different level with retailers than many of our competitors can. The second part of this is the commercial contribution it actually brings to our company. So again, we're talking a category that is growing 10% to 15% year-on-year. And we're now at a margin with this business, slightly above 7%. And it's a EUR 200 million business for us. And I would say, any business of that size growing at that speed at that margin is fundamentally commercially attractive. Now so that also, of course, gives a significant contribution to the overall profitability of us in Cloetta. The last part is the scale benefits that we get through Pick & Mix. The first one is, of course, the fact that we have -- basically, we control the assortment in the Pick & Mix shelf of more than 4,000 retail outlets in the Nordics. That means we also set the standard of how much will Cloetta's products and brands be displayed in all of those stores. So that means we can secure the availability and the visibility of our branded products as well in the Pick & Mix shops. And secondly, there is an obvious synergy with this kind of volume growth in our production. And the fact also that Pick & Mix as such is typically fairly efficient production process. And secondly, which was alluded to previously, when other parts of the confectionery category maybe be declining, this makes us less vulnerable, having all this growth in our production network. So essentially, it gives us a competitive advantage both from a category leadership perspective, from a commercial perspective as well from an efficiency perspective. Now we are ideally positioned as Cloetta to really leverage this competitive advantage because we are essentially, as I said, we're the market leader in all the foreign Nordic markets. And we're the only player who had a Pick & Mix business in more than 1 market. So essentially, we're the only Pick & Mix player who can scale this business. Now I did mention the commercial contribution and the positive commercial contribution of Pick & Mix. Those of you who have followed us for a while are aware that has not always been the case. So therefore, I thought I'd spend a few minutes on explaining the turnaround of Pick & Mix that we had and the reengineering of the Pick & Mix model that we made. So we acquired the CandyKing Pick & Mix business back in 2017. At that point in time, it was very much a volume business. In 2018, we integrated that business into Cloetta, both in terms of production as well as organization. And at that time, we delivered an EBIT slightly above 1%. Now I came into the company in 2019. We started, of course, looking at how do we make this model profitable. We settled the plans and how do we reengineer this model. And we were getting quite well on our way. But as you may recall, what happened when you came back from your winter holidays in February 2020, the pandemic hit. And that had a fundamental impact on all of society, on most businesses and equally, for us. So basically, during 2020 and 2021, we were very preoccupied managing the impacts of the pandemic. That meant it took until 2022, 2023 until we really started getting the implementation of the new model out in the market. We started getting the traction from consumers and from retailers. And it took another year for us to get the benefits of that in terms of the value that we were contributing to consumers and retailers into our pricing as well as the efficiencies we had in the new model to really start having effect. And that meant in 2024, we had an EBIT slightly above 7%, which is at the upper tier or even slightly above our midterm stated target, which was between 5% to 7%. Now we believe this margin improvement is sustainable. And to give you an understanding of why we feel that, I'll give you a little bit better view on what this reengineering of this model actually means. So at any point in time, when you want to turn a business that is turning 1% EBIT to 7%, it doesn't have to be rocket science. And basically, what we do is you make sure that you contribute enough value in your model for retailers and consumers to be prepared to pay the price, you need to be profitable. Secondly, you manage your cost to make sure that benefit comes all the way down into your P&L. Now if you convert that thinking to our reality, 2 things we had to do. The first thing was creating consumer and retailer value in our Pick & Mix CandyKing model; and secondly, using our multi market leverage and scale to make sure we become much more efficient. Now I'll take you through this, starting with the consumer retail value, and you can follow it from the top right. So basically, what we've done is we went from generically and simply providing candy in bins in not necessarily inspirational executions and not in very consistent ways across markets to delivering what we mean a superior in-store experience, which has traction with both consumers and retailers. The second thing we've done is we've gone from basically only activating this category through price promotions Which, over time, has a tendency to erode your margin to actually activating in a much more qualitative way where we do themed promotions in store, and we use social media and advertising through our CandyKing brand. Now to give you a better sense of what I'm talking about, this is essentially what our Pick & Mix business looks like in 2019, across the 4 markets in the Nordics, not necessarily inspirational, not necessarily consistent. This is what it looks like today, much more inspirational, much more consistent. And even on the bottom right, you can get a glimpse of are the digital screens that we have started introducing into the trade to take the experience to the next level. We went from this kind of promotions, very generic, very price-oriented to this, basically building our brand of CandyKing as well as driving the CandyKing and Pick & Mix in social media and advertising and also using inspirational packaging because at the end of the day, that's what the consumer puts their candy, brings home and puts on their table. Which means the CandyKing experience begins before you even enter the store. It's there when you are in the store, and it's actually after you've been in the store when you take it home. So going back to this slide and going back to the lower part, which is the operational efficiency. So back in 2019, we had very different assortments across the markets, very different products. Now we have a much more cross-market assortment, where we, through the insights we have, know which products can play a similar role in the different markets and where do you actually really need some local adoption. And that has allowed us to cut down from over 1,100 SKUs in our system to around 650 today. The second piece is around merchandising, which is not an insignificant part of the cost of any retailing operation and certainly ours. And we had very disparate merchandising models and setups in the markets. And today, we have a much more consistent way of working across the market in a much more efficient way. So this is essentially what this has done is not only has it landed us a much more profitable Pick & Mix with more traction with both retailers and consumers, it had also landed us a repeatable model. Because basically, this is now something that we can scale and leverage in -- both in our current as well as in new markets, which takes us to the more forward-looking part of this presentation. How do we now use this going forward? So I'll take you back to this slide. And Katarina showed it previously, but I'd like to touch a bit on the drivers behind Pick & Mix to make you understand what kind of potential we see in this concept. So Pick & Mix taps into 2 of the strongest FMCG trends that we have. The first one being consumer individualization or the need and expectancy for consumers to individualize their offer whatever they buy. And that might be when they go to the Nike store to get their sneaker in exactly the right shape, the exactly the right color, with exactly the right laces, with exactly the right padding and obviously, the right size. Or it may be when they go to the Sephora store to get exactly the right makeup kit for their skin complexion, matching the preferred look that they want to have in that given point in time. Now if you turn that over to a grocery retailer perspective, there are a few, if any parts of that store that can answer up to individualization the way the Pick & Mix can. Because essentially, the consumer stands in front of the shelf with somewhere between 60, up to even 250 SKUs to choose from exactly what kind of candy you like in exactly the right amount they'd like it and they can mix their own bag. Second one is the retailer trend, which is the trend and the need for retailers to drive more inspiration, more excitement in their stores, which actually accelerates the consumer trend I talked about. Because today, a consumer, if you're looking for convenience, you can go shop online. Yes? Basically in whatever thing you choose to shop on. If you're looking for prices, you can go to a discounter. So the retailers are increasing, you need to find reasons to get consumers into the stores, and they have to offer inspiration and excitement. And there are very few things again that can deliver this as well as a well-managed inspirational Pick & Mix shelf actually can do. So with this in mind, when we look at our core markets, we see clear potential to grow further in all our core markets, essentially. We are now upgrading our EBIT ambition from the previous stated 5% to 7% to a new level of 7% to 9% for our Pick & Mix business. 4 drivers behind this. And you will recognize them from Katarina's presentation. One, we will continue to increase Pick & Mix. There were around 600 to 800 stores still in the Nordics that are not carrying Pick & Mix even if the penetration is already high here, somewhere between 50% and 65% of the households. So there's still room to grow. We are obviously looking to convert more stores to CandyKing. Both stores who are carrying other -- either private label or other generic executions to what we now think is a superior CandyKing model. There is an obvious one. But also to upgrade those CandyKing stores who have a bit more standard, execution to even more premium experience using digital screens using even more premium assortment, which will allow the retailer to charge a bit more. And needless to say, maybe, but still get a bit of kickback to Cloetta in that. Third one is leveraging CandyKing and extending it in e-com. Also, Katarina alluded to it. We have already a very strong business, thanks to Christoffer back there with foodora and [ Vault ], where we deliver a prepacked Pick & Mix solution with the -- in a CandyKing cup, which also allows us to bring CandyKing into channels where a physical Pick & Mix shelf is not available. And finally, launching CandyKing model in Netherlands. We talked about it. We have a very strong team down there already. But CandyKing -- but Pick & Mix is not commonplace in the Netherlands. And there's an obvious opportunity to bring CandyKing into that market. Now looking beyond our core markets, we, of course, come to beyond core, and we can look at several markets. And there are several opportunities of entry. But I'll call out 3. And again, there will be no surprise on this. The first one is the U.K., where we already had quite a wide distributed business with Pick & Mix. But we haven't revamped to the CandyKing level that we have in the Nordics. And obviously, that is something that we look to do, and we look to do a similar journey that we now have done in the Nordics there. The second one is Germany. Germany is Europe's biggest candy market and its completely virgin territory as well for Pick & Mix. And we will pilot that, again, using the team we have in place to do that and explore what kind of traction we can get in the German market for CandyKing, Pick & Mix. And finally, the last one, which is North America, that is the world's largest candy market, where a window of opportunity has opened through the Swedish candy trend. And there, we also see a lot of traction and interest from a lot of players over there around Swedish Candy and Pick & Mix, which is also seen as an interesting part of Swedish Candy. So we will start exploring that, piloting primarily in non-grocery and using those pilots to understand and perfect what the Americans are expecting, or the Canadians are expecting from a Pick & Mix model and what gets traction. And we can then use that model when we perfected that to take into grocery retail and pilot it and potentially roll out later. So a lot of interesting opportunity, of course, a lot of exciting opportunity, but we will, of course, do this in a very structured way, making sure that we make the best use of our resources available at any given time. So to sum this up, again, to -- if there are 3 points I would like you to take with you from this presentation, Cloetta has now successfully reengineered our Pick & Mix model. We are now delivering an EBIT slightly above our previously stated EBIT target between 5% to 7%. The repeatable CandyKing model that we now have reengineered and have proven track record with is solid ground for continued profitable growth, and we are upgrading our EBIT ambition for Pick & Mix from 5% to 7% to 7% to 9%. And finally, given our market leadership in all the core markets as well as with the fact that we are fairly unique as the only cross-market player in Pick & Mix and the only player with a repeatable model, we feel we are ideally positioned to lead and leverage the grow and Pick & Mix consumer trend, both in our current markets as well in new markets. So with that, thank you very much, and I'll hand over to Frans.

Good afternoon. My name is Frans Ryden. I joined Cloetta in 2018 as the CFO. Before that, I spent 20 years outside of my native Sweden working for a group of companies that includes Kraft Foods, Mondelez, Philip Morris. So I'm responsible for finance, but also for IT and legal, and together with Laura, Communications and Investor Relations. Now over the next 30 minutes, I will take you through growth, profit, cash and capital allocation. Starting with the growth. So we're very happy to have share that we are increasing our long-term organic net sales targets from the previous 1% to 2% growth to 3% to 4% growth. Now you have to know then that 1% to 2% growth was based on the idea that was roughly how fast the market was growing and we were going to grow in line with or at times better than that market. And if you look at the slide here on the last 5 years, we have obviously grown faster than that. It's a 5.1% CAGR since 2019, despite the dip there during the pandemic. But we also know that there's a lot of pricing in this. A lot of pricing we've taken on account of our own increasing input cost. I'm going to come back to that piece. Now Katarina also presented that going forward, we're expecting a market that will grow at 2% CAGR. So it's important to note that with this new target, we are significantly stepping up our ambition by saying that we will grow faster than the market. How we will do that? I think it's been well said a couple of times, it's focusing on our Superbrands in the core markets. They are already growing faster than the other brands. They are more profitable, and we think even more focus here is the right way to go. And secondly, in the markets beyond the core, instead of going for 50 markets to again focus in on 3 markets where we have a great opportunity to win. It doesn't mean that we will exit the other markets, but this is about focusing harder. I'm not going to repeat the whole strategy, but we expect that the core markets will grow roughly at the range of the 3% to 4% per annum. And that beyond the core markets, we will grow 2x to 3x faster than that range. Now everyone is bringing out their calculators, they're saying, hey, if that's 80%, that probably means that the core markets will be at the lower end of this, maybe at 3%, the beyond core could be at 8%, then you get sort of to the 75% of the total sales that will be from the core markets in the future. You can do this in different ways. The main point here is that with this strategy, we will further diversify our geographic footprint. Katarina, she spoke about the benefit of being in many categories. When chocolate prices were going up, we could lean a little bit more heavy on other parts of our portfolio. Niklas spoke about what was happening during the general inflation surge, and we could lean a bit harder on the Pick & Mix. And by diversifying our portfolio further, we will reduce the risk in the company and also, we're creating opportunities to further profitable growth. Ultimately, growth is the engine and the oxygen of an FMCG company. Moving then to the profit. Yes, moving then to the profit. And again, going back to last sort of 5 years, our profit has been steadily growing, and we've also held a consistent EBIT margin, around 10% to 11%. Now that still leaves quite a gap to the 14% long-term target that we've held for a number of years. Katarina shared high level, how we intend to solve for this. And I'm representing it in the circle here. And it's worth noting that scale is at the heart of this. That's the growth. That is really, really important for us. And then the 3 other areas that will support this is driving margins and profits through net revenue management. It's about securing a supply chain that is fit for purpose, and it is about creating an effective operational structure. And I'm going to go back into each 1 of these and provide more details. Starting with the net revenue management. So there's 4 different areas predominantly we're tackling here. And the first one, Thomas already spoke at length and eloquently about, and that is to drive margin-accretive innovation. There's a large part of our portfolio that is turning over every year. And by making sure that every product in the funnel, before it hits the market, will make more money than the average and certainly more money than the product that it may be cannibalizing; that drives value. Number two, coming back to the pricing. So there's a graph here on the pricing in the last 6 years. I'm not giving the numbers because it's so sensitive, but it is at scale, it is at scale. And as you can see, the last 3 years, the amount of pricing we've taken vastly exceeds what we did the 3 years prior. So our brands has that kind of power. And in net revenue management, it's about making sure we get full value for what we're bringing for the effort that we're putting into the brands. And we'll do that by balancing two things. On the one hand, healthy margins that allows us to invest in the brands and drive profit with a competitive proposition to the consumer, where they will go into our customer stores, buy our product, which, of course, then generates more sales for us. I think it's fair to say also that during the time when inflation was getting way ahead of salary increases, consumers had a tough choice. But in these circumstances, we're incredibly proud that they continue to go into our customer stores and buying our products. That's an incredible strength that we have in our brands. Thirdly, it's about mix. Super brands is part of that mix, but so is always channel mix, customer mix, geographic mix. There's mix within the brand, there is a mix between products. We can maximize the value of the effort that we're putting in by working the mix. And the fourth area is portfolio harmonization or optimization. We have previously shared that we have reduced about 30% of the number of products, stock keeping units that we have since 2021. That means getting rid of small product volumes, unprofitable ones, those that don't fit and constantly replacing with something better. There is more opportunities here for sure. But as you get closer to the bottom of the barrel, you have to also be a little bit more careful. You don't want to lose distribution that's very expensive to recover. But there's a second benefit with harmonizing the portfolio. And that is about that it makes it easier for supply chain to provide volumes and doing it at a good cost. So let me move to that side of the equation. So if you imagine that if you have many different types of products, you have to make more changeovers for supply chain. If there's different recipes, you have to clean more often. When you start the machine, again, it takes some time before it gets fully up to speed. So harmonizing the portfolio will help supply chain, for sure. Now we're also going to have more focus on our existing supply chain going forward. And that means we can also have more focus on the own cost that we're generating in our business. And that will also drive efficiencies. And thirdly, how we manage on the procurement side, our vast amount of cost that goes into the actual product. 50% roughly, that's SEK 8 billion on the total circle there. 50% is raw and packaging material and consumables. How we manage the cost around this is incredibly important. And especially now when sort of on the front page of every other day, they talk about cocoa prices going up or this happening. So I'm going to zoom in on that area specifically for you. But I'll leave that as a cliffhanger. But first, I just want to comment on the creation of an effective operational structure. So Katarina already mentioned a number of things that we want to do. I would phrase it the following way. A couple of years ago, we drove a lot of cost out of our systems through zero-based budgeting. It's about getting more money or more bang for your buck, and it's also about making sure you spend where it matters the most. And obviously, now we have a new strategy. So of course, we need to go back and revisit this and make sure that the resources are sitting where it matters the most for the new strategy. Now coming then to -- back to the procurement side. Simply put, it is a very simplified model now that when costs go up, unless you've locked in your prices on forward contract, you have to take that cost. And if you have the contract, you're happy for a while, but eventually, it's over. And if costs are still up, you have to take those costs. If you try to lock in a contract for all eternity, I mean good luck with the price you'll get today for doing that. So what it really is about is making sure that we can time this so that we can get our own new pricing through before we hit by the higher commodity costs. So it's a game on timing. But it's not the only game in town. We have a professional function of buyers, roughly 20 people spread across Cloetta, who spend every day trying to figure out how we could spend less for what we are already buying. And I'm listing four different examples here, which I think are quite interesting for you. So the first one is, over the last few years, we've stepped up our professionalism, how we handle commodities significantly. So we have tools and processes not only to monitor markets but also to make predictions about the future. That doesn't mean that we're always right, but it means that we can make conscious decision when do we want to cover for how long and what percentage of the spend, instead of doing this on a standard 3, 6, 9 months or whatever, it doesn't go by default. And we are covering 67% of our commodity spend this way, up from 46% just a couple of years ago. And of course, we want to take this further. The other one down on the side here, is on the contract manufacturing. So when we're outsourcing the manufacturing of products to third-party value upstreaming. So this is not only about having a transparent book about the cost that goes into the product and that will get charged to us, but this is that their volumes gets consolidated with our volumes when we're negotiating with the suppliers. Simple terms, volume discounts. So as you can see here, we're roughly at 30% on that. By next year, we expect to have more than double it to 70% of the spend. Obviously, we buy a lot more than any given contract manufacturer. Thirdly is to have strategic agreements on the packaging side. 60% of our packaging purchases are set up this way. So yes, there is transparency on the cost side, but there something more to it. It's the fact that this is long term. That means less risk for the supplier, it means lower cost for us. It also carries other benefits. And actually, Thomas had it on one of his slides as well. When we work with suppliers, we can get novel packaging ideas coming out of it, which is an added value beyond just lowering the cost. And the last area is on value engineering, which is a type of cost mitigation. There's many different ways you can do that. But again, with an increased focus on our own supply chain structure, we will also put more focus in this area. So a couple of examples could be that you change something in the production process that reduces waste. This could be about replacing an expensive material with one that is less expensive, maybe permanently. Or if it's a flexible recipe, you can use either one of them and you always pick the cheaper one, but you still provide the same taste, mouth feel, texture, smell that the consumer expects. This could be about down gauging. Maybe you go to a thinner plastic foil that still gives the same amount of shelf life, it's good for the environment and it's good for our cost. So there's many different ways of doing this. And in this, of course, is also to make versus make versus buy, which brings us back to the whole contract manufacturing versus own investments. So key point on this slide is that we are not sitting idle, waiting for the market to turn in our favor and then reap rewards for that. This is about us actively working on our cost every day. So bringing it all together from a profit side, we expect with this strategy to be able to add 3% to 5% total Cloetta EBIT margin upside in the long term and 1.5 to 2.5 already by 2027. And in this table and somewhat mirrored in the graph below, I detailed this out. And hopefully, you recognize yourself as I walk you through these lines. All the numbers are on total Cloetta EBIT margin change. They are all rounded to 0.5%. And I provide ranges as well. Ranges, both because there are some interdependencies here, there's choices we will make as we're progressing on the strategy, and some people would think there's probably also a little bit of uncertainty about the future. So starting with the core markets, so number one, scale. Remember, that's the heart of this. Now scale from growth only works if your costs are not going up at the same rate. So scale is about growth and efficiency together. And we're expecting that we will deliver 1% to 1.5% total Cloetta EBIT margin upside from the scale in the core markets in the long term and 0.5% to 1% by 2027. Then we come to the mix and if you remember, mix is part of net revenue management. But here, I'm separating and showing the mix effect specifically for the super brands because it's so high up on the agenda. Now the super brands also drive scale, that's on the top row. But then we have the added benefit that this scale is also worth more because more of the scale comes from the super brands. So that will deliver between 0.5% to 1% EBIT margin in the long term and 0.5% by 2027. Then there's the rest of the net revenue management. You remember, this was the margin accretive innovation. It was about the fair value, it was about the rest of the mix, it was about the portfolio harmonization. Again, in the long term, 1% to 1.5% EBIT margin for total Cloetta on account of doing this in the core markets and 0.5% to 1% by 2027. On the beyond the core, despite that it's only 20% of our business, I still allowed two rows there, so it's a bit more detailed compared to size, but there are really two things I want to highlight here. The first one is, yes, we will drive scale and net revenue management. But also, we will invest in this. This will not come for free. So I want to separate the investment very clearly there. Whereas in the core market, investment which will come, is paid for by net revenue management. Here, I want to break it out. And what you see here is that initially by 2027, it's not such a big difference. It comes more in the years beyond 2027. And you see it even more clearly in the waterfall graph here. So if we think about the proposition and the level of risk up until 2027 and our commitment to reach at least 12% EBIT margin, that is not coming from a risky proposition to expand in North America. That is driven by what we're going to do by focusing in our core markets. But then beyond 2027, while the core markets will still deliver more of the EBIT upside, you start seeing here that the beyond core markets are punching above their weight, additional 1% EBIT margin versus the 1% to 1.5% from the core markets. So this is obviously about the growth, the net revenue management. You know that we're more profitable in the core markets than in the other markets. So there's a bit of a turnaround that is required here. But I think as Niklas showed, we can do turnarounds. And then for the last two rows on the operational side, we do see some potential here as well to actually deliver an accretiveness to the total Cloetta EBIT margin. But then you have to remember, this is net of the inflation that will come there. So this is still a very strong number. And then while both these sets of markets will go profitable in a profitable manner in their own rights, and we're very excited about both of them, with less profitable beyond core growing faster and also with pick & mix expected to grow a little bit faster than the branded side, there is a mix effect. And then there is also a few others baked in there. But net-net, when we look at this, we see 3% to 5% EBIT upside in the long term, which means that we are reconfirming our commitment to reach 14% EBIT margin. And as you can see, there is even some room for headwind there. And then 1.5% to 2.5% means that we are confirming the new target of reaching at least 12%, starting from 10.6% last year, at least 12% by 2027. Now profit is no good if you don't get the cash. Fortunately, of course, we have a business that does very well on delivering cash. So we have a strong cash flow. Last year, that resulted in our lowest ever net debt of SEK 1.6 billion and also our lowest ever leverage of 1.3. So we are in a really good position as we are embarking on this new strategy from a balance sheet point of view. And before I take you to the overall capital allocation, how we're going to use this cash, let me just zoom in on CapEx within operations and to some extent, what we do on the pick & mix side. So the last 5 years, on average, we spent about 3% of our net sales on CapEx investments. That is low. But that is low and it makes sense that it was low because it was in anticipation of that we were going to build the greenfield. Now as you know, and that Katarina spoke about, we did a proper reassessment at the end of last year, and we have identified a number of different options, which are about investing in our own network, it's about outsourcing, it's about leverage portfolio harmonization. And these can be combined in different ways. Now today, we are not going to share you exactly what the options are or which are our preferred option. But what I can do is give guidance on the CapEx spend. So we're looking over the next 5 years to increase our investment to 4% to 5% of our net sales, after which this would come down to 3% to 4% on an annual basis. That, of course, is significantly less than what it would have been with a greenfield investment, where we would have landed more average over a 5-year period on [ 8-ish ] percent of sales, which brings me to my second last slide or the last slide before wrapping this up, and that's on the capital allocation. So in the graph here, you can see the full set of money, if you will, that we've been allocating over the last 5 years on average, which is about a bit over SEK 1 billion average each year the last 5 years. And how we're obviously, with this growth and improve margins, we'll have more cash to allocate out going forward. Now the strategy for us here is that we're going to invest in organic profitable growth. This is about supporting the super brands. It's about the distribution and route to market, whether that is within the core markets that Katarina spoke about, or if it's for the beyond the core. And it's about creating a flexible supply network, as described previously. M&A used to be very big part of Cloetta's growth journey. It was actually up until 2017, where the growth was coming from. Since then, as shared, we haven't bought anything. We have been focusing on driving organic growth with our own fantastic brands, and it's working. And we've been focusing on turning around pick & mix that we had acquired. Now we're in a position where we say we are more open for M&A again. We never took it off the table, but we are now more open for it. But it will be as an accelerator that drives the strategy forward. It's about the access to the consumers through the route to market, passes and [ gum ]. And it's about next-generation treats, what will come sort of out of the Cloetta Next or similarly. Thirdly, we have a, as I mentioned, a very strong balance sheet. And we're also pleased to say that having reviewed our strategy in detail, what we want to do, what we can do, what we will do we are lowering our leverage target from the previous around 2.5, down to below 1.5. Now obviously, there could be an instance here where there is an interesting M&A that would require us to deviate from this temporarily. That would then happen, but with a very clear deleverage plan and how we will get back. The last box here is dividend, not because it's the least important. I just wanted to end the slide on a high note. So we are also happy that the Board has changed the dividend policy from the previous 40% to 60% of profit after tax to now saying above 50% of profit after tax. And as you know, the Board has recommended the shareholders to approve a dividend of [ SEK 1.10 ] earlier later on in April, which would be an increase of almost 50% on the dividend since 2018. Which brings me to the wrap-up. So number one, net sales, organic growth target increased to 3% to 4%, driven by our super brands in the core markets, select 3 markets beyond those leading to higher diversification. We will fuel this growth and improve margins through scale, net revenue management, securing a supply chain fit for purpose and creating an effective operational structure. That allows us to retain our long-term EBIT margin target of 14%, but we're committed to reaching at least 12% by 2027. We have really strong cash flow, our lowest net debt ever, our lowest leverage ever. And as I took you through the capital allocation strategy, the conclusion should be we are investing for organic profitable growth, M&A as an accelerator for this strategy. And at the same time, we shared that we have strengthened targets on leverage and on dividend. And with that, I will hand back to Katarina.

Yes. Thank you, Frans. Great. So it's time for a wrap-up. Thank you for spending this afternoon so far with us. So in short, the wrap-up looks as following. First of all, we are North European leading confectionery company. And we are creating joy. We have done that for 160 years, and we are committed to spread joy for at least 160 more years. The second big bullets that we also want to summarize this presentation so far is really we operate in a noncyclic market. And there is, as I said, a stable consumer demand, and we are outgrowing the fast-moving consumer goods in food, coming back to the 1% every year on the volume going up. What is also something we are really proud of, we have a broad and flexible portfolio. And this meaning that we can also adapt and meet the change in the evolving consumer demand. Our brands are really our heroes. We have been brands that has been on the market for more than hundred years. And now we have international super brands. But on top of that, we also have local heroes, we can say. And the loyalty for our brands is something that we're really proud of and also something that is a strength for us as a company. Today, we have presented we see growth opportunity, we really see growth opportunity. And we do that through our super brands, we do that through focus on Germany, U.K. and also Sweden, North America. And we also see that we will excel in marketing and innovation. We have also talked about M&A. We are open to strategic M&A, and that is very much to focus on speed up the strategic agenda to get the geographic presence and do the category expansion. But we're saying also, it should be a good business case. And in the financial targets, these are not included. But we open up from an M&A. And as Frans was saying, we really have an attractive cash flow, where we have a clear upside on the margin and of course, the shareholder value. So today, we have presented our strategies, our vision and now our new financial targets. Frans has already went through them, so I will not go through them in detail. But it is with ambition and the strategies we have, our new long-term financial targets are 3% to 4% organic sales growth. Our 14% EBIT stays, but we are committed to reach a minimum 12% by 2027. The net debt over EBITDA, we have strengthened the leverage and saying we want -- we will stay below 1.5, with of course, the exception in case of some big M&A. And then the dividend policy, we are now saying minimum 50% of profit before taxes instead of 40% to 60%. So this is a summary of what we have presented during the afternoon. And now I will invite the gentlemen and Laura to the scene, and we open up for some questions and answers.

Than you to all of the presenters and thank you to everybody here in the room and also online for staying with us this far. Now starts the most exciting thing, the Q&A. And thank you, [ Inderes ], for the fastest table delivery in the history of table deliveries. So first, we take the questions from the room. So if you have a question, raise your hand and kindly state your name and then ask your question. We also know that we have questions online, but we will first take the ones from the room. And we have gentlemen in the back.

So you're hoping for M&A. But how many targets are there available in your markets that fit what you want from a size perspective and opening up new distribution? So being open to M&A is different than having a list of names that you follow closely, you even have [ coffees ] with. So can you talk a little bit about how big the opportunity is from M&A perspective? And the second question is probably for Frans. What are you going to do with the money on the CapEx side? Is it refitting factories, extending lines, putting new lines in, so going for a bit more capacity or -- so where's the incremental CapEx going into in terms of the footprint?

Okay. So I will start with the first question. It's, of course, relevant and very good questions. So we have worked with the strategic work now since September and until now. We have a list of interesting prospects. We're also being approached quite often by a different candidate. But this is also about now to ensuring now we set the strategy. And so now it's more that we will actively go into this [ mode set ]. So it has been more screening and seeing what it is. But I would say, there are some interesting objects, but something still. We said the business sense is very important, of course. So we need to take that as a next step.

So on the CapEx, [ Evan ], so what we found through the reassessment is that there's different paths to deliver both capacity that we seek with the right margins and also on the sustainability side and they are around our own investment, contract manufacturers and the portfolio organization. So we've chosen not to sort of give the details on that today beyond the guidance on the CapEx that I shared. But obviously, when you do look at manufacturing, you would think about things like what is for production, what is for packaging, what is for automation to be able to do the same thing for a lesser cost. So there's a number of different things that we're looking at there. And unfortunately, I can't give you more detail than that now. I would sort of be starting to pull the thread on the sweater and then eventually, I have nothing on me.

Very good. Thank you very much. Yes, [ Nordea ]. Please go ahead.

[ Adrian Elmlund ] from [ Nordea ] again. Maybe I missed this, but could you perhaps break down the growth components a bit more? Like what -- historically, it's been a lot of price, you say. And going forward, you expect to basically double the organic growth. Is that more or less volume or still talking about price here? And maybe, can you connect that to -- historically, the market, you say, grew roughly 1%, and now you're doubling the expectation for the market as well to 2% CAGR. Is that also -- like is it price and volume? Or how come the market will grow faster than it has historically?

Yes. I mean so first of all, the volume, as you saw from Katarina slide, is been 1% and it's expected to be 1%. So that is not really change in the volume growth. I think what that graph really tells you is that no matter what happens, this is a category that people go back to. Then in terms of the retail sales growth on that, we're talking about 2% going forward. Now obviously, if we assume another huge hike on inflation, you would have to change that number. But then we will adjust price for that, and then it becomes nonsensical. So I think it's more the point of saying that volume for the market is 1%, retail value is 2%. We're saying that we will grow 3% to 4%, so above that. Part of that will come from volume. Part of it will come from net revenue management, of course. Now just also to be super clear, so the historical CAGR is 5.1%. So there's a lot of pricing in that. So it's not that we are increasing the speed going forward versus historical, but it will not come from hyperinflationary pricing.

Okay. And then another question maybe regarding Germany that you said you wanted to test pilot. Was it the pick & mix segment? Do you have any recent historical examples of that happening, entering a new market with pick & mix? How does it look? What's the cost? How long does it take to get the foothold, so to say?

No. So the short answer is not really because basically we have been very occupied since 2019, we're making the current upgrade of the pick & mix model to -- with the state that we are now both in profitability as well as interaction with consumers and retailers. What we do have is a very clear way we want to do this by making sure we get the engagements from consumers before we sort of start rolling into retail. So that's the answer, basically.

Have you had any pilot testing yet?

Yes. We've done some pilots in a few markets, but It's -- I wouldn't -- that's very, very early days. Ask me again in a couple of months.

But if I can just build on that answer because I think it is obvious for us. But if your question -- if I would change the question to, do you have experience of going into a retailer who hasn't had a pick-and-mix concept before and establishing it there, then the answer will be many, many, many times because that's when we take new contracts, we're going in a whole new setup. So this is just the fact that we're doing it in a new geography.

Okay. Thank you. We continue with [ Nicholas ].

[ Nicholas Koban ], Nordea. You have this 12% margin target in '27. But how should we think about the progression until 12% in '27, i.e., this year and next in terms of the margin?

Yes, Frans?

Okay. So yes. So it's at least 12% by 2027. And sort of -- and we're in sort of like early 2025 now. So it feels like it's fairly soon. So obviously, there will be a progression towards it. We're not providing, as you know, a guidance for the year. We haven't done that before. We're starting off from 10.6. So I -- if I were going to give you a 2025 or 2026 number, I would have put it on the slide already. So the 2027 is all I have to offer today.

Sure. But I was thinking if you -- if we should sort of expect some upfront investments or anything like that, so the impact would be sort of back-end loaded rather than...

Okay. No, fair enough. No, no. This will -- no. It's not a hockey stick. This will be a gradual progression to work there. If anything, I'd like to think that we will be quicker in the beginning, but I'll leave that answer.

Very good. Thank you very much. Any further questions from the room? Yes. Please go ahead.

So in the noncore brands, obviously, you sold the nuts business, right? So are there any brands that could be up for sale that you think they could actually have some intrinsic value for another buyer, and they are not core to us and that we focus on the core brands, and there should be some proceeds from that? And is there anything to be sold in that area?

Yes. Yes, thank you. Well, I would say, of course, it's -- we sold Nutisal, and I say that was like the largest of the brands that was not really fitting the portfolio from that perspective. So of course, we're reviewing all the time and see what is happening in the portfolio. But we also -- those local brands are also very strong, and we have some high loyalty and the consumers are loving them. So from that perspective, we need them all as well, and we will continue also to do support them but not in such a scalable way as we will do with the super brands. So I would say, there are no large -- [ then ] is very, very small, and it doesn't make any -- like it hardly impacted the P&L, so to say, or the balance sheet.

Thank you. Any questions from the room or shall we go online? Very good. We'll move online. So the first question comes from one of our U.S. shareholders. So good morning. Without -- let's see here. Frans, I think this one is for you. Is the new growth ambition meant to be purely organic? Or is selective M&A included in the 3% to 4% annual growth ambition?

As Katarina actually also mentioned, no, this -- that will be an accelerator to go above the 3% to 4% growth target, so that's not built into the financials.

Excellent. And then we continue. What's your take on the rise of Ozempic? Do you think it will impact Cloetta the near future?

I can take that answer. It's, of course, an interesting question, and there has been some concern about this. So first of all, we have -- we are selling joys. And regardless if you are non-Ozempic or not, you want to have joy. And we also have an assortment that is [ 25% ] -- is sugar free. We talked about the small boxes from Lakerol, that is really interesting from that perspective as well. We have also -- Thomas and I, we also had some conversation with in the U.S. because they are far ahead in this, and we wanted to understand what happening in your market. Do you see any shifts in this? Yes, of course, they raise it, but they couldn't say that they saw really big movements right now in this area. But of course, this is something we track, we have -- we're listening, we've been observant. And now also when we have -- we are initiating the program of Next, this will be something that the Cloetta Next will have under its radar. And if we see some changes, then we will of course, be agile and see what we will -- if we can find some alternatives going forward. But we have a great portfolio, and I think regardless of which weight-loss program or drugs you're going on, you still want to indulge and you still want to experience joy.

Thank you very much, Katarina. And then we have somebody who clearly wants to test our IR policy. Without going into details, can you elaborate on M&A? Do you have anything on the radar right now?

It was the same question. I think that's the answer.

Right. Correctly, sorry. Good. I think that's everything from the online unless we have somebody who wants to post new questions. Any further questions from the room? Yes, [ Nicholas ], go ahead.

One quick last one. You have the 1.5x net debt-to-EBITDA target now, and you said you're willing to go beyond that in case of M&A. But how far beyond that are you prepared to go temporarily?

Frans, do you have any?

So I mean two. So number one, I did -- even though it was indicative on the slide, it talked about the last 5 years and the next 5 years in terms of capital allocation and you had M&A update, right, and we don't really see that M&A would be a hugely disruptive thing. We're talking about that as an accelerator, if you look at that box compared to the organic investment that we're seeing. So probably the sweet spot for us is maybe a company that's roughly around 10% of our sales. And so it's not going to -- it wouldn't really drive our leverage maybe above -- wouldn't go above 3 and then it would quickly come down again.

Thank you. And we have new questions in the chat, also from our U.S. shareholders. Given that your leverage target is already met and in the absence of M&A, could the dividend be as high as 80% to 100% of PAT?

We could. Yes, Frans what can you say?

I think the Board recommends -- the Board will recommend and the shareholders will decide.

Of course, this is very much the Board's decision.

Good. Thank you very much. It looks like we do not have any other new questions online. Any last questions from the room? Anyone? Very good. Then maybe Katarina a few words to thank everyone.

Yes. Thank you so much for spending this afternoon with us. Super appreciated. And to you guys online, I hope to see you next time live. Please, again, thank you so much, and there will be an opportunity right afterwards. Okay. So thank you very much for this afternoon.