DFI Retail Group Holdings Limited (D01) Earnings Call Transcript & Summary

Ladies and gentlemen, thank you for standing by, and welcome to the Dairy Farm's 2020 Half Yearly Results Briefing conference call. [Operator Instructions] Please also note I would now like to hand the conference over to your host today, Mr. Ian McLeod, Group Chief Executive of Dairy Farm; and Mr. Clem Constantine, Chief Financial Officer of Dairy Farm. Thank you. Please go ahead, gentlemen.

Okay. Thank you, Anna. And thank you everyone for dialing in this evening for our half year results for 2020. I'll just move quickly through the presentation disclaimer on Slide 2 and then moving to Slide 3 for the agenda. We'll cover off the 2020 half year results highlights, which I will do in a second. Clem will run through the financial results. I'll come back with a business update on where we are in turn to our strategic priorities and our business transformation progress, and then complete with an outlook on where we believe things might be progressing going forward. Okay. So moving on to Slide 4. Clearly, these are extremely unusual times, and we are having to respond to those times in the way that every other retailer is as well. But we're also keeping a sharp eye in the future. And we have not taken our eye off the transformation board in the process. So we've continued to push forward on some of the structural changes that we made and business evolutionary changes that we've been developing in order to make sure that we're well set for the future as time progresses and we move out of the current unusual times. So total sales for the half year, including all associates and joint ventures, were actually up 6%. In terms of subsidiaries on profitability, the profit proved pretty resilient in our subsidiaries despite the COVID-19 impacts, bearing in mind that our subsidiaries cover not just food, but also other sectors as well. I think what this demonstrates is something, which I've said before is that there's a combination of both our business change programs, which we're now putting in place and seeing the benefits of and also our portfolio of diversity where we have stores in food, in health and beauty, in home furnishings and restaurants and also a combination of subsidiaries, which we control and also investments in other businesses. That combined portfolio impact provides us with some degree of resilience to the effects of individual events and underpins our overall performance. So what we've seen is we've seen strong sales and profit growth coming through in grocery retail, including Southeast Asia, this time, which you might recall has been fairly problematic in the past. Strong performance has continued to take place in home furnishings with IKEA improving in each of the individual countries in where we operate and also seeing some strong contributions coming through from e-commerce. The lockdown restrictions, however, have impacted areas where they are largely dependent upon high footfall from tourists, most notably in health and beauty and mannings, where we've had strong benefits from Chinese tourists coming over the border in Hong Kong in the past. And clearly, with COVID, those board restrictions have had a bearing on the health and beauty performance for Mannings in Hong Kong. But also the 7-Eleven, Maxim's, where there have been restrictions that have been made in relation to lockdown, which has compromised passing foot traffic into those areas. And therefore, that's a natural effect. We still believe in each of these markets, in each of these businesses that the underlying strength of those businesses remains strong because of their scale in each of the markets in which they operate. So they will have resilient performances relative to competition, we believe, and will still be set there for improved performances over time as things hopefully get back to some form of normality. We've also seen strong profit growth coming from Yonghui and Robinson's Retail for the 3 months ended 31st of March. Bear in mind that both of those businesses report their results after we do. But given their strong bias towards food retail, then clearly, the impact on most food retailers has been positive in relation to the change in consumer behavior. And but also announcing an interim dividend of $0.05 a share. So those are the overall highlights of the performance of the last 6 months. I'll now hand over to Clem to talk you through the actual financial results. Thank you.

Thank you, Ian. Good evening, everyone. Let me take you through the interim results of Dairy Farm International Holdings Limited. Total sales, including associates and JVs were $14.5 billion, plus 6% on last year. Sales were driven by strong top line performances from both Yonghui and Robinsons. Total sales of subsidiaries were $5.2 billion, minus 9% on last year. And sales continue to be impacted by our space optimization program in Southeast Asia. Subsidiaries underlying [ PATAM ] was $101 million, minus 4% on last year. A strong underlying performance given the circumstances associated with COVID. Our share of [ PATAM ] from associates and JVs was $4 million, minus 94% on last year. And this drop was mainly driven by a steep fall in Maxim's profits. Total underlying [ PATAM ] for the group was $105 million, minus 40% on last year. So total reported profit after nontrading items was $115 million, minus 35% on last year. Underlying earnings per share was $0.0777 and we've declared an interim dividend of $0.05 per share. Now turning to sales in a little more detail. Total subsidiary food sales were $3.8 billion, plus 1% on last year. Grocery retail sales were $2.8 billion, plus 5% on last year. And we saw good performances from nearly all our divisions with sales particularly strong in Hong Kong and Singapore. Convenience sales were $1 billion, minus 7% on last year. All 7-Eleven businesses were impacted by lockdowns. Furthermore, China had to deal with 400 stores closed at the peak of the pandemic. Health and beauty sales were just over $1 billion, minus 36% on last year. The decline in visitors following the border closure in Q1 has significantly impacted our Health and Beauty businesses, both in Hong Kong and Macau. And as a consequence, we focused our efforts on improving our offers to local customers as well as ensuring we are managing costs in a prudent way. In Southeast Asia, Health and Beauty performed well in Q1 but was also impacted as government restrictions came into force from March. IKEA reported strong sales growth of 5% due to the annualization impact of new store openings. IKEA also saw strong e-commerce growth, which was partially offset by enforced store closures due to COVID. With respect to the associates, Maxim's were significantly impacted at minus 29% on last year. The business saw an improving trend throughout Quarter 2. However, the latest restrictions announced will obviously impact the business going forward. Yonghui and Robinson sales are based on Q4 2019 and Q1 2020. And sales growth was strong at plus 22% and plus 32%, respectively. Although it's worth noting that with respect to Robinsons, we're comparing 6 months this year, with 5 months last year. Overall, subsidiaries underlying profit was $211 million, minus 10% on last year. And if we exclude the IFRS 16 adjustment on PBIT, the underlying PBIT for the subsidiaries was only minus 7% down on last year. The negative impact of movement restrictions and border closures on health -- on our Health and Beauty and convenience businesses were set off by strong profits from grocery retail. Our cost improvement programs have also started to kick in, helping to underpin profits across all our divisions. Our SG&A costs are $20 million lower than last year, reflecting efficiency savings in all areas, including IT. So overall, we have seen a robust performance from our subsidiaries in very difficult circumstances. And this performance is further underpinned by our ongoing transformation programs. Now turning to cash flow and net debt. Operating cash flow for the first half was $76 million. Working capital worsened as a result of the slowdown in both Health and Beauty and convenience sales. Other operating cash flow saw a reduction due to tax paid in Q1 historically paid in Q4. And as a consequence, net debt has moved from $821 million at the end of the year to just over $1 billion at the end of June. However, Dairy Farm remains in a solid financial position and has access to $750 million of liquidity consisting of $270 million cash reserves and $480 million of unused committed debt facilities. Now in summary, despite the challenges of COVID, this is a robust financial performance, underpinned by the diversity of our portfolio, the ongoing positive impact from our improvement programs and the many customer initiatives we are rolling out. And with this, let me hand you over to Ian to take you through our business update. Thank you.

Okay. Thank you, Clem. Just moving on from Slide 10 into Slide 11. This is a reminder in a slide that I know I've presented before, it's just a reminder of what we regarded our strategic priorities in relation to building capability, growing in China, maintaining our Hong Kong strength and revitalizing Southeast Asia and, of course, looking to see how we might improve in terms of driving digital innovation. We've continued to focus on those aspects and we have 3 basic time lines to evolve over a 5 to 6-year period, as you no doubt recall. Phase 1 being about building a solid foundation, Phase 2 about delivering consistently well and then Phase 3 being about driving through Dairy Farm's difference. We are still in progress of building a solid foundation, but I believe that we are making some very strong progress in that regard and moving further on to delivering consistently well in many areas. So as we sort of transform -- transition out of Phase 1 into Phase 2, we're confident that we are strategically in the right direction. That's also been helped and improve by the improvement programs themselves. 4 key programs: One, in term of driving fresh supply chain efficiency; another in relation to improving labor productivity and then looking at 2 ways in which we might leverage our scale and gain economies of scale through negotiating more collectively. One through procurement centralization for goods not for resale. And the other one through assortment optimization. We're looking at ranging optimization far more effectively by country and by banner and by segment. And each of these individual areas are proving to be very productive in terms of their ability to generate savings or leveraging cost savings, which we then look to reinvest more broadly in making sure the business remains or improves in terms of its overall competitiveness. Fresh supply chain moving end-to-end has seen some significant improvements in terms of driving end-to-end efficiency. Collective sourcing means that about 60% of our fresh produce volume is now sourced collectively across all our Food businesses. And efficiency improvement program has been put in place in the stores to drive up fresh food freshness and also drive down stock loss and stock waste. Our assortment optimization program has been running for 2 years now and where we've identified key suppliers and local suppliers, we believe, can help us improve our assortment for our customers. We're also acting collectively as a group in order to make sure we can use our economy of scale to improve our cost prices. Each of those programs has proved to be very successful. And in terms of the improvements, they're ones which we are now seeing annualize and will continue to improve going forward. So the underpinning support we have from the improvement programs that Clem alluded to, has had a material benefit to the business in terms of our ability to, perhaps, within the subsidiaries with some of the environment -- external environmental shocks that we've experienced in these uncommon times. Moving on, just on 1 or 2 of the aspects of what we've been doing. Rather than cover everything in detail for each individual one, we've endeavored to pick out 1 or 2 key elements that I'd like to talk about. And then what I'd like to do is just take you through 4 or 5 of the key areas where we're seeing some progress, just to give you a better, sort of, understanding of some of the changes that are being made and the benefits that are coming through. We're talking about building capability, and I believe that we've got very strong leadership team in Dairy Farm and also some middle management strength [ in-depth emerging ] as well. So we've strengthened our talent pipeline. And we're also beginning to evolve and develop new junior management development programs and want to make sure we start to build through a strong succession plan for the future. What's also evolved is some cultural change we've had where one of the strongest challenges, I believe the company faced was that we had very strong silo management mentality, which meant our ability to act collectively as a business was compromised. Over the last 2 years, we've worked very hard to try and break down those barriers and have people acting as one business and part of a broader team. And that came to the floor in a very positive constructive way as we focus very heavily cross-company on driving approach that we adopt through the COVID crisis. In terms of China, we continue to expand 7-Eleven in China. As Clem alluded to, that's been pretty challenged in the last few months due to the severe lockdowns in Guangdong and the store closures that we had to endure. A number of those stores are now open, but foot traffic, particularly in the MTR areas is still quite limited. And certainly not back to that as it was before. But as things return to some form of normality, then we're confident those positions will continue to improve. We still see great potential for our 7-Eleven business in China and further expansion plans are -- continue to be in place, both our own stores, our franchisees, and therefore, that expansion is set to continue. Indeed is continuing as we speak. Within Mannings in China. We've now sought to adopt a more so China focus. One of the benefits we've had in 7-Eleven is by focusing very heavily in the Guangdong area. It's given us the opportunity to understand that market particularly well and ensure that we're very well represented there. Mannings has tended to take a cross China approach more broadly. And our strategic focus is changing slightly, such that we focus our off-line development within South China and Guangdong and then look to evolve and develop broader e-commerce approach into evolving developing Mannings across China itself. Moving on to maintaining our Hong Kong strength. We've had mixed results across [ balance ]. It's fair to say. Wellcome has done particularly well over the last few months, and the team have done an excellent job in terms of managing supply chain to the best of their ability in order to respond to fairly dramatic volatility in terms of customer demand. Clem has mentioned the challenges that Maxim's have faced. And 7-Eleven has been impacted or perhaps not as severely as China, but it has been impacted by lockdown restrictions and reductions in foot traffic through the last 6 months. And Health and Beauty with regard to Mannings because of the broader restrictions that have been placed has always had a bearing on that business. So some businesses have actually performed well. Others have found it far more challenging. We also announced more recently the divestment of our Taiwan business in Wellcome. That business actually has performed better in the last, sort of, 6 to 12 months than it has done in probably the previous 24, and literally term from being a business in decline to one that was in positive growth both in terms of sales and in terms of profitability through some of the initiatives and programs or price investment strategy we put in place. So actually, it's performing in quite a positive way at the moment. And it's credit to the team there in terms of what they did to turn that business around from where it was. However, it's a small -- relatively small market and there's increasing consolidation and increasing levels of competition. We felt it was better and more appropriate for the business to be consolidated into a larger scale business in order to ensure that it was able, more effectively, to compete going forward. And also to seek to protect the future career development and job opportunities for our team members there. And therefore, we felt it was better in all our interest, including the acquirer of the business in order to make sure that, that business moved on into other hands. With regard to revitalizing Southeast Asia, we've seen a strong grocery performance and whilst there's certainly been benefits in most grocery businesses as a result of a move to buying food in the grocery stores and cooking at home, we believe that had it not been for the change that we made within our businesses over the last 18 months to 2 years to improve operating standards, to improve freshness, to improve availability then we would not have been in a strong position as we were in order to respond to those very significant changes in customer demand. In an announcement that we made last year to look to see how we might consolidate our position in some of these markets, particularly within regard to the Giant brand and the space optimization was put in place. There's been a substantial amount of work that's been taking place in Malaysia, Indonesia, in order to bring that about. And that is now close to completion, and it's proven to be the right call strategically and it's been executed extremely well on the ground by the team. And whilst it's impacting our overall sales performance, we'll begin to see improvements in the stores that remain in order to make sure we can still compete effectively in those markets. So moving on. We're now not just thinking about repairing the challenges that we faced from the past, but also how we might move forward and advance in a more effective way for our customers and across our individual markets. The most significant announcement is the Yuu program where we're launching the large rewards program in Hong Kong, which I'll cover in a bit more depth in a moment. The launch of the Meadows brand, which is our own brand into key markets. We've also developed used formats for our upscale stores and that's been launched into each of the key markets as well. We've got a number of growth initiatives evolving with regards to e-commerce. And recognizing the importance of the local customer in Hong Kong, we've just launched a price investment program, which is seeing encouraging results in Mannings. And IKEA continues to expand both online and off-line, I'd like to cover that as well. So just taking each of those in turn. The Yuu program is driving digital transformation. It will be the biggest rewards club ever, covering all the major brands in Hong Kong: 7-Eleven, IKEA, Wellcome, Mannings, Marketplace, KFC, Pizza Hut and still underpinned and supported by the in enJoy Card with our approach with Hang Seng. So a number of different aspects to the program. It's going to be the most compelling affiliate program across Hong Kong. Customers will be able to enjoy benefits from a points based earn and burn common currency in each of those individual banners. It's a program that we've been working on behind the scenes for some considerable time and it literally launches within the next 24 hours. So a very strong launch program. High customer awareness. It includes more than 10 household brand names across 2,000 locations, across Hong Kong, so it's readily accessible. And customers will be able to enjoy the benefits of earning points and gaining loyalty discount just simply by doing what they've done in the past. So people say, there's no such thing as a free lunch, but I think there's a free lunch, a free breakfast, free dinner as well. So this is literally something that all our customers can enjoy and hopefully, will make the difference between them shopping with us and shopping with our competitors in each of those individual segments and banners in which we operate. So we're pretty excited about it as a business. We think there'll be a major initiative and a major change in Hong Kong. And frankly, given what Hong Kong has been going through over the next 6 to 9 months, I think the general public in Hong Kong will certainly welcome this benefit. And for us, it also unlocks a very powerful CRM personalization capability. Through the data, which we will receive from our customers, we'll be able to look at far more targeted effective promotion programs and far more effective, motivational purchasing discount availability that actually are targeted directly to customers in terms of knowing what will motivate them and what they will be interested in. So effectively, we will be doing the filtering for them in order to make sure that we can best represent their interest in each of our stores. And that is also true in terms of our data analytics capability and understanding what sales and what doesn't, so that we can optimize our ranges even more effectively throughout our banners in Hong Kong as well. So it works on a number of different levels. We're very pleased with Hang Seng as our partner in this. They're very committed to the program as well. And it's great to have the opportunity to join forces with other Jardines brands in order to make sure we pull together something, which is going to be very effective for everybody in Hong Kong. The advertising marketing campaign is extensive. You literally won't be able to miss it if you're in Hong Kong. We're using George and Alex Lam as our headline. George was renowned and famous in Hong Kong for a song called, Uptown Girl, made famous by Billy Joel elsewhere in the world. We're using that as our signature tune. We've changed the words to match to the Yuu program with George singing it. And they'll be appearing in each of our marketing channels in order to make sure we've got somebody who's instantly recognizable and his son across Hong Kong to get that resonance for the local customer. And indeed, we will be taking some of our target store banners and painting them blue, as we hope to do for the rest of Hong Kong, too. I think it's a really exciting program. I think that some of that our customers will be excited about, and we expect opportunities to provide that loyalty to them for some time to come. Moving on to Meadows. Meadows is a new brand that we've just launched very recently as an own brand. And it covers a number of different aspects and is a key part of our value strategy. One of the things that I felt is important within our Food businesses is that we need to make sure that our pricing is competitive. And therefore, we set ourselves a position to develop a common brand across our key banners, food banners and indeed convenience banners and to some degree, our Health and Beauty banners as well. We have one brand, one own brand strategy. And the emphasis is on quality but also on value for money. And value for money talks about quality and price. And the price target is to be 20% at least lower than the prices of an equivalent brand. And these products will be as good as the brand, if not better. So we've launched the first 300 SKUs. We've sourced them from around the world to get the best quality at the best value that we can. We've looked to introduce them. A very significant amount of work has gone into making sure that they are well designed, they taste great and they're really competitive in terms of pricing. Prominently positioned in our stores. They're already receiving a very strong customer response. We're very confident about the quality of the products, and there'll be more to come besides. So these are going across a number of banners, in a number of countries, in a number of categories and are launching progressively in those countries over the next couple of months. When I first arrived here a couple of years ago, whilst we did have some good own-brand products and indeed still do, we have probably between 20 and 30 corporate brand, alternative sub-brands. The challenge with that approach is that the customer can ever remember any of them. And therefore, if you want to be famous for your own brand, it has to be memorable. The name has to be memorable. It has to be easy to pronounce. And it has to be something that people can recognize and know that they can only get it from you. The Meadows brand fulfills all those customer-targeted needs. And that is really, I believe, the reasons why we're actually seeing some strong successful results coming through from each of these new brands that we have in place. Already, when it comes to saltines, where we were being outsold by the brand leader by 3:1 prior to the launch. We're now in a 1 brand in saltines. We're also the #1 brand in butter and margarine within our stores. Meadows is also the #1 brand within frozen vegetables. It's actually the #1 brand in nuts across each of 3 banners, whether it be Meadows in Wellcome or Meadows in Mannings or Meadows in 7-Eleven, it's the #1. And our potato chips here increased by 700% since the launch of Meadows chips. So this is the start, not the end, but we're very encouraged by the progress that we're making, the adoption of the product by the customer. And the way it provides us with a competitive advantage as we launch and develop more products under this brand going forward. Moving on to how we're refreshing and reformatting our stores. Within the Giant refresh. As a reminder, which I spoke of before, we've done over 100 Giant remodels since 2019. So the stores that are going to continue under the Giant brand in each of those markets. We've all developed a low-cost remodel program, which has now taken effect and is integrated in the improved operating standards and Fresh, hygiene -- health and hygiene standards that we put in place as well. And the stores, although albeit has been some time for -- because -- since I've seen them since COVID is introduced, are significantly better in terms of their operating standards than when it first arrived. And it's credit to the teams there for what they've delivered. But there's more to come with Giant. We're not finished. There's more to come and we'll announce that in due course. When it comes to upscale, we focused on trying to get a consistent approach into upscale as well. So trying to make sure that in upscale, whether you are in Malaysia, in Singapore or in Hong Kong, we have a consistent upscale format applied. There are differences around the edge, but you can actually see that they're all part of the same family. The brand being used in Malaysia is Mercato, which was a brand that we bought a few years ago in Malaysia. And CS Fresh or cold storage fresh is the evolved brand that we put into cold storage in Singapore. And then we have the known MarketPlace brand here in Hong Kong. We've launched pilot stores in each of these brands, in each of these countries in the last few months. And the customer response has been very encouraging. We're seeing an average of a 30% increase in customer count. We've seen a very strong focus on Fresh, which is being recognized, appreciated by the customers with triple-digit growth in Fresh meat and produce. And we're looking to strengthen our international sourcing requirements, as I mentioned earlier on Fresh, in order to make sure that we match the changing customer dynamics for our products from around the world with great quality and exclusivity to us. But also looking where we can to support local suppliers more broadly and line in place in Hong Kong, we have a dedicated area just for Hong Kong produced product because we do believe that it's important that we -- where we operate, I mean, we've been here for a while. We have a responsibility to give local suppliers a chance and we fully intend to continue to do that. This is an example of the Mercato store in Malaysia, in Penang, and you can perhaps see the difference in terms of the emphasis in relation to freshness. Equally, in CS Fresh in Singapore. Again, a focus on freshness. But you can see between the 2 brands, there's a very strong sort of commonality of approach in principle in terms of how these particular stores are laid out. And this is a recently launched Marketplace store in Hong Kong. But again, a very strong focus on fresh food. And it was also the store that was featured in the opening page of this particular presentation. So lots going on with new store formats, evolving and developing, encouraging results so far and more to come. And so again, it's actually started to take some of the changes that we've been making behind the scenes starting to bring them forward and introduce them customer-facing to improve the brands overall for the future. With Mannings, I mentioned earlier on, that there's been a challenging times with Mannings, and you've seen that in the results that Clem presented. But what we are doing is making sure that we make Mannings even more relevant to the local customer than perhaps it was before. We're looking at our ranges, we're looking at our pricing and we're looking at improving our overall performance. So we're focused very much on what customer needs. We recognize even within Hong Kong, there are different demographics in different areas. And as a result of that, we're seeing the benefits of having a more targeted effect. The value [ investing ] we put in place that underpins and supports the price investment is very clear, and it's something of an approach that we learned from our successes in Taiwan in terms of having a single mind approach and an engaging approach to the customer. And therefore, using the Mannings cats to represent it is not just about the use of a cute cartoon, it's to reinforce the customer that when prices are reduced, and they see the cat, then those prices are long-term price changes. They are not simple, one in, one out, week on, week off price discount reductions on promotion. So this is a sustained step change in terms of our price position in Mannings. And whilst this has only been in place for a matter of 3 or 4 weeks, the results are very encouraging. We've seen very strong volume growth come through, strong customer count running through. But the interesting thing is it's not just about growing the products that have actually been lowered in pricing. There are a number of key brands in there. Just giving customers more confidence, and therefore, they're growing the overall basket as well. So it's helped the overall store. It's not just about cannibalization. It's been growing at overall volume and value position. And as a result of the changes we've made, even at this early stage, we're seeing them being sales and profit accretive. Again, it's early days, I have to put that emphasis on it but we believe is a step in the right direction when -- around all our markets. But in Hong Kong, we're seeing people looking for that particular improvement in value and our job and our determination to seek to provide that in each of our banners. In terms of e-commerce growth, we've seen strong e-commerce growth come through in a number of different markets. We've seen over 10% increase in e-commerce and penetration in Mannings in China. We've seen an improvement in our cross-border e-commerce site. And once it's early days, we're seeing improvements there as well. We've launched more recently a Mannings transactional website, which has been developed from scratch in the last, sort of, couple of months. Again, we're seeing a strong uptake of that from customers as well. By having that online/off-line opportunity, particularly in relation to Click and Collect, which surprisingly has had a strong uptick in terms of customer demand. And so, with so many Mannings stores around Hong Kong, that's giving additional opportunities for customers to access that product online and then collect it from the store itself at their convenience. Equally within Guardian, we've seen e-commerce growth there, an improving sales and service capability there. Very strong demand coming through when COVID first broke, which is difficult for all retailers to maintain, but we've increased our capability through our warehouse pick-and-pack model. And put more lines on both in Guardian in Malaysia and Guardian in Singapore to respond to that additional demand requirement. There's still more work to be done, but we believe it's a step at the right direction. In food, our service capability in food has probably lagged e-commerce in other markets. But that is something that we're working on quite strongly. We're evolving a new website for our Marketplace stores in Hong Kong, and we have plans to improve performance in other markets, too. But Hong Kong will be our initial focus. So there are plans in place to improve over time our e-commerce capability in each of our key markets. It should also be said that within IKEA, they've had a very strong e-commerce performance as well. And IKEA continues to grow both online and off-line. So we've seen a number of evolution developments come through there. We've seen sales and profit growth despite COVID-19. It might be thought initially because IKEA might be regarded as non-essential items that would have an impact. But actually, because of the value and the quality of the brand, we haven't seen that severely as has happened. Certainly, at time when there's been a lockdown restrictions on stores, particularly in Indonesia, we've seen a very strong lift in e-commerce. And the IKEA team are ready to respond to that. We've seen very strong growth in e-commerce in the last few months. Also in-store as well, we've seen good responses there too. As people move to cooking at home, and cooking utensils have been sold more effectively in the stores. So the market haul effect has definitely been strong. And even to the extent of people sitting at home, looking at an old kitchen, saying it's time for a change. Well, it's been the catalyst for them to come to IKEA and seek to buy more. So we're very encouraged by our IKEA performance in these times. We've opened a new store in Macau. That's been in the planning for a couple of years now. It opened just a couple of months ago. People literally had to -- because of COVID had to go online and order a ticket to actually get into the store. So I've been at retail a long time but I've never had to issue tickets for admission before. So that's now released, and we've got more people coming in besides. So that's an encouraging launch. And just last week, we opened a large replacement store in Taoyuan, in Central Taiwan, which was a large hole in the ground when I saw it about 7 or 8 months ago. And is now open to a fully fledged -- our latest store in Taiwan, which continues to grow as well. And we've got further new stores planned. So more to come with IKEA, both online and off-line. This is a photograph indicating what new IKEA Macau looks like in a shopping center that's just being developed in Macau, where IKEA is the anchor. And you can get basically the products there that you would expect to get another IKEA stores supported by the Swedish food market, which also goes well. The Swedish meat balls might not be a traditional Asian Dish, but certainly, we have pretty strong demand for those in each of our markets. And the Taoyuan store that I mentioned has just opened, and that's how it looks like today. So strong performance from IKEA continues, which we're encouraged by. And we believe that we're well set here for the future. It's been a tough time. You can see that in the results. But our job is to try and look beyond where we are today, and to make sure we continue to build this business for the future in a strong and effective way. And we firmly believe that we are doing that. So our confidence in the transformation remains strong. But clearly, with the duration extent of COVID impact, that still remains uncertain. Our transformation progress now provides a solid business foundation, which I mentioned earlier on. And our improved initiatives will continue, but we're very encouraged by the progress that we've made in terms of bringing them to bear so far. There is both macro changes to our business and micro change to our business that are taking place. All about building a better Dairy Farm for the future. And our offline and online investment will continue in a very disciplined way. We have very strong -- a much stronger approach to ROI than perhaps was there before in order to make sure we're investing the money in the right place at the right time. Mannings is improving, but the tourist dynamics are key. And whilst we're making changes now, we believe that any change we're making in Mannings now without the tourist flow, we'll certainly benefit there. It will come out stronger when those borders open up again, as indeed, we will be doing in other markets. So still a long way to go. Many challenges within the business. There's a strong team here, which I believe are determined to make sure we see Dairy Farm grow from where we are, address our challenges, both external and internal, and build a stronger business as a result. Thank you.