Fourlis Holdings S.A. (FOYRK) Earnings Call Transcript & Summary

Ladies and gentlemen, thank you for standing by. I'm Costantino, your Chorus Call operator. Welcome, and thank you for joining the Fourlis Group conference call and webcast to present and discuss the full year 2024 financial results. We have with us today Mr. Vasileios Fourlis, Chairman; Mr. Dimitrios Valachis, CEO; and Ms. Elena Pappa, Investor Relations and Corporate Affairs Director. [Operator Instructions] And the conference is being recorded. [Operator Instructions]. At this time, I would like to turn the conference over to management. You may now proceed.

Good evening, everyone, and thank you for participating in our annual results conference call. I'm Vasileios Fourlis, Chairman of the Board. During 2024, we continued to deliver on our strategic priorities. We had strong retail performance, thus gaining market share in a difficult market environment. We also delivered significant profit improvement and thus exceeded our guidance, profit guidance. We also enhanced our shareholder returns through higher dividend, $0.15 per share and share buybacks. Finally, Trade Estates, our subsidiary, was successfully deconsolidated. And later on, we will have some more details regarding that. Going more in depth regarding the execution and growth of all our BUs. IKEA delivered the first new store, Patras after many years. And next week, we are opening Heraklion, which is going to be, in our opinion, the fourth largest store of IKEA in terms of turnover in the region. We also continued our remodeling of IKEA stores and especially the airport store, which is now producing very good sales results. Also, we have a new generation of urban IKEA stores that we plan to open during the next 2, 3 years. Going into our second pillar of activity, sportswear, 2024 was a milestone year because of the signing of the agreement with Foot Locker. Foot Locker is the world leader in sneakers and especially sports style and high-performance sneakers also. We have signed an agreement to develop the stores in 8 countries besides the 4 that we are now operating, 4 more countries in Western Balkans. Starting last Monday, we have acquired the first 3 Foot Locker stores in Greece, the week coming 3 more in Romania, plus the 3 that we have already opened in Bulgaria. We plan this year to have a number of new stores also. Intersport, the performance sector of our sportswear business, opened 8 new stores and launched the world's first football club store Athens, which is going to be a pilot for all of Intersport stores. In our Health & Wellness sector, we have 4 new Holland & Barrett stores, and we are still working to deliver performance on this new sector. Finally, our logistics arm, TRADE LOGISTICS, signed a very important agreement with InterIkea, IKEA International in order to build and operate the InterIkea logistics center for the Eastern Mediterranean. This logistics center will be operational towards the end, beginning of next year. A few words I would like to say about the deconsolidation of Trade Estates. As you all know, that was one of our targets to deconsolidate Trade Estates and accounted from now on as a participation subsidiary. It will not be consolidated line-by-line as it has been until now. So from now on, in our income statement and balance sheet, it will be obvious, the activity of retail plus the participations below EBITDA. The private placement of 60% -- of 16% has provided close to EUR 30 million cash flow for the group. And by the end of the first quarter, we will be able also to announce the profit coming from this transaction. I think I will pass to Dimitrios Valachis, our CEO, to go into more details regarding the company's review.

Thank you, Vasileios. I will start with -- give you an outline how Fourlis Group looks like today. We are a focused retail-driven group operating across 3 core business pillars: one, home furnishing with IKEA concept; sportswear, which as of quarter 4 last year, apart from Intersport now we have also the Foot Locker, which broadens our offering, our customer reach and our geographical footprint; and health awareness driven by our Holland & Barrett franchise, which we are continuing to expand in Greece. Alongside our retail businesses, we have TRADE LOGISTICS, our in-house logistics platform. This is a key enabler of our retail operations and is now evolving into a profit center, offering third-party logistics services and unlocking operational efficiencies across the group. And finally, after the private placement, we maintained a strategic participation in real estate investments through our 47% stake in Trade Estates. While no longer consolidated as a subsidiary, Trade Estates continues to represent an important value component within our portfolio as it will contribute in the group through its high dividend payout and strong profitability. As a result, the structure today reflects a group that is strategically focused and committed to delivering long-term value. Our strategy remains clear and focused. We are committed to delivering high-quality products and customer experience and service, investing in our people and driving digital and operational transformation. We will continue to expand our retail and logistics footprint, grow our omnichannel and e-commerce capabilities and maintain a strong focus on efficiency, cash flow generation and sustainability. Let's now move on to look at the financial performance of 2024, and we will start with the group's continuing retail operations for 2024. As a reminder, in the 2024 financial statements, Trade Estates is fully consolidated and presented under discontinued activities. Despite the challenging external incident during the final quarter of the year, we exceeded our profitability guidance for our retail business. In late November, just before the Black Friday period, our group was a target of malicious cybersecurity attack, temporarily disrupting digital systems across our company's operation, mainly impacting store replenishment in home furnishing segment and our e-commerce channels. Thanks to our rapid incident response collaboration with cybersecurity experts and full compliance with GCPR obligations, the issue was quickly contained and resolved. No leakage of personal data was identified. The incident had an estimated negative impact of EUR 15 million in sales, primarily concentrated in December. However, through swift cost adjustments, a strong operational agility, we fully absorbed the impact on profitability and delivered ahead of expectations. As a result, revenues grew 1.6% year-over-year, which represent a 4% volume growth. If you remember, IKEA has reduced, from the beginning of the year, the prices by 10% in at least 1/3 of our rents. Gross margin improved to 46.9%, driven by strong supply chain efficiencies and disciplined commercial execution. EBITDA rose by 17.9% to EUR 42.3 million with the margin expanding to 8%. EBIT grew 26.8% with a margin of 5%. And finally, profit before tax increased by 2x to EUR 7.9 million and profit after tax to EUR 6.3 million. This performance highlights our team's ability to navigate unforeseen challenges and protect our margins. Looking ahead from 2025 onwards, the group's profitability will also include our contribution of income from Trade Estates as it will be consolidated as an associate company under the equity method.

Right. I will not go into the details of Trade Estates since Trade Estates has already announced its results. What I would like to emphasize as far as the group is concerned is that the target of Trade Estates to reach a gross asset value of EUR 1 billion and net asset value of EUR 0.5 billion by 2030 still holds. We already have the signed projects that will take Trade Estates to around EUR 750 million to EUR 800 million. And we believe that the participation of the group in Trade Estates will be -- will provide a significant cash flow -- annual cash flow coming from the dividend policy of Trade Estates.

So we saw the results of our retail business. We also look at the Trade Estates results. So in summary, the group -- the profit of the group goes to EUR 20 million, up from EUR 19.2 million last year. Our strong operating cash flow generation has resulted from the increased profitability of the business and the efficient management of working capital, enabling us to invest in our further expansion and also deliver shareholder returns while maintaining a healthy and flexible balance sheet. The total shareholder returns for 2024 is approximately $9.5 million. Out of which, EUR 7.6 million will be the Board's proposed distribution of a cash dividend. This is equivalent to EUR 0.15 per share and represents a 25% increase versus last year and a payout ratio of approximately 38% of 2024 net profits. An additional EUR 1.94 million was allocated to our share buyback program, representing 20% of our total shareholder returns for the year. By year-end, the group held 2.6 million treasury shares, representing 4.9% of the current share capital. At the same time, we continue to invest in our future growth with EUR 25.1 million in retail CapEx, primarily supporting IKEA and Intersport store expansion and maintenance. Our retail net debt position remained stable at EUR 85 million, while our net debt-to-EBITDA OPR ratio improved from 2.4x down to 2x, reflecting the group's increased profitability and cash generation. This gives us the financial flexibility to continue funding our growth, reward shareholders and further strengthen our strategic positioning across the markets we serve. And with this, we are moving on to see in detail the different sectors.

Thank you, Mr. Valachis. Let's start with performance and strategic development of our home furnishing segment, IKEA. We have made good progress in expanding and optimizing our IKEA network across the region. One of the key highlights was the opening of the new IKEA store in Patra in October 2024. It spans 7,200 square meters and is part of the Trade Estates Top Parks concept, bringing greater reach and accessibility to a high potential region. At the same time, we completed the remodeling of the IKEA store at the Athens International Airport retail park. The resizing of IKEA allowed us to introduce 3 new complementary tenants: Intersport, Holland & Barrett and Plaisio, creating a more dynamic and synergistic retail destination. In Bulgaria, we are expanding through new formats. A Plan & Order studio opened in Pernik in Bulgaria in March of 2025, enhancing our urban presence and service model. We are also preparing and advancing our pipeline. Our Heraklion store is on track to open this month, and our planning continues for the IKEA flagship store in Ellinikon targeted for 2028 as part of the most significant mixed-use development increase. Additionally, we are actively exploring new urban format new generation IKEA stores near smaller cities to bring the brand closer to more households. Our IKEA strategy continues to focus on high-quality customer service, accessibility, flexibility and efficiency with formats tailored to market potential and evolving consumer needs. We are also advancing our key strategic priorities, including expanding the network, reinforcing our presence near city centers, enhancing our omnichannel offering to provide a seamless customer experience across physical and digital touch points and leveraging digital tools and technologies to improve operations and better serve our customers. Turning to the financial performance of our Home Furnishing business in full year 2024. IKEA continues to be one of the best-performing regions with InterIkea Group -- within the InterIkea group, maintaining a leading market position across our countries of operations. Despite operating in a subdued home furnishings market, volume sales increased by approximately 3% year-over-year. This was below our expected run rate of plus 6% in volume and plus 4% in value, which was temporarily disrupted by the cybersecurity incident at the end of November. Nevertheless, the business delivered a strong recovery and exceeded profitability expectations. Gross profit margin improved significantly, rising from 43.7% to 46.8% in full year of '24, reflecting the benefits of our supply chain efficiencies and strong sourcing capabilities. EBITDA also increased by 22.7%, reaching EUR 37.5 million with the EBITDA margin improving to 10.8%, up from 8.8% in the previous year. EBIT grew by 30.2%, reaching EUR 29.6 million, with margin expansion from 6.5% to 8.5%. This strong performance was driven by a combination of commercial discipline, cost optimization and operational efficiency, enabling us to fully absorb external disruptions and continue delivering solid profitability. Moving to the sportswear business, where we continue building a leading multi-platform across our region. A key milestone in '24 was the launch of our partnership with Foot Locker, making our entry into the fast-growing lifestyle and fashion segment of the athletic retail market. We successfully introduced the Foot Locker brand in Bulgaria, opening 3 new stores in top-tier retail locations with strong early consumer engagement. In April of '25, we will have completed the acquisition of Foot Locker's operations in Greece, which is already done in Romania, significantly expanding our footprint. This partnership supports our strategic goal of broadening our sportswear offering, while also strengthening our geographical spread. Just a few words to put this partnership into context. Foot Locker is one of the largest chains of sporting goods stores in the world. It was founded in 1974 and has approximately 2,500 stores in 26 countries. This is a game-changing partnership for us, enabling us to expand across 8 countries, Southeastern countries, and tapping into the underserved, high demanding markets for sneakers and athleisure. Alongside the Foot Locker, we continued to strengthen our position in the sports performance, especially Intersport. In 2024, Intersport expanded its footprint with 8 new store openings across our region. And the major highlight also within March was the launch of the world's first Intersport football club store in Athens, a unique concept built entirely around football culture. Together with Foot Locker, we are building a sports retail powerhouse, well positioned to capture growth across both performance and lifestyle segments. Our strategic priorities are very clear. We aim to enhance our leadership in sports performance through Intersport store network expansion, strong brand partnerships and enhanced consumer engagement platform, at the same time, enter dynamically through Foot Locker in the large style category and expand Foot Locker's network across Southeast Europe. At the same time, we are focusing on synergies between the 2 brands, growing our e-commerce and omnichannel capabilities for both brands and leveraging digital tools to elevate the customer experience. In terms of key figures, for the sportswear segment, revenues grew by 4.1% year-over-year, reaching EUR 181.1 million with a strong acceleration in the final quarter of the year. Growth was supported by network expansion, enhanced product assortment and effective promotional campaigns. Our gross profit margin improved to 47%, up from 45.4% in full year '23. This reflects optimized inventory management and supply chain efficiency, alongside discipline pricing and category management. This improvement, combined with strong cost control led to solid profitability growth. EBITDA OPR rose by 12.4% to EUR 12.6 million with the margin improving to 7%. EBIT increased by 21.1% year-over-year, reaching EUR 5.3 million with margin expanding to 2.9%. Moving into the Health & Wellness segment. In 2024, we launched 4 new stores in Athens as part of our 3-tier format strategy, bringing the total to 10 stores across Greece, complemented by a fully operational e-commerce channel. We are seeing high customer loyalty and conversion rate, and we are now taking targeted actions to further increase brand awareness. At the same time, we are actively exploring new opportunities for expansion in both assets and other areas. In terms of key figures, revenue reached EUR 2.3 million in full year '24, up from EUR 0.8 million in the previous year, driven by strong customer conversion, loyalty membership growth and a significant increase in like-for-like sales, approximately 50%. Our gross profit margin improved to 48% from 46% last year, reflecting a favorable product mix. EBIT settled at minus EUR 2.4 million from minus EUR 2 million last year as we continue to invest in store rollout and infrastructure. However, we are seeing clear signs of improving profitability as stores mature and sales grow. Let us now turn briefly to TRADE LOGISTICS, our group's logistics platform. A key highlight in '24 was our collaboration with InterIkea for the new international distribution center in Aspropyrgos, spanning over 5,000 square meters. At the same time, our existing facilities [indiscernible] continue to operate at high productivity level, supported by advanced automation, robotics and daily picking capacities of over 60,000 units. Looking ahead, TRADE LOGISTICS is evolving into a stand-alone business unit with the ambition to provide third-party logistics services across Southeast Europe, while continuing, of course, to serve the group's omnichannel retail growth. And before we close, let me take a moment to highlight our progress in ESG, a core pillar of Fourlis Group's strategy. Sustainability has been embedded in our operations since 2008 with a focused internal sustainability department and the dedicated internal sustainability reporting department. We have also made investments in further supporting our ESG capabilities through an internal ESG reporting tool that enables us to automate the process of data collection and validation. Within 2024, we completed our Double Materiality assessment and aligned our reporting with the CSRD Directive, ESRS, GRI standards and the ATHEX ESG reporting guide. Our ESG strategy focuses on 5 key areas: energy and emissions, waste management, working conditions, social contribution and corporate culture and governance. We have established a new Board level committee for sustainability, ensuring ESG is under direct strategic oversight and embedded across our operations. On this slide, you can also see some of our tangible outcomes from 2024, a 12% reduction in Scope 1 emissions in Greece and solar-based energy covering more than 300 megawatt hours of our needs, savings in food waste from IKEA, shoe recycling initiatives, significant community impact [indiscernible] over EUR 1 million in flood relief, over 45,000 meals distributed, volunteer actions and the strong governance foundation with 56% independent BoD members and 0 incidents of corruption and 44% women on the Board. We have also established clear targets under each pillar from emission reductions and circulated goals to workplace safety and governance effectiveness, all supported by our [ Board-level ] committee on sustainability. And with that, we are now -- thank you very much for your attention. With that, we are now open for any -- at your disposal for any questions you may have.

[Operator Instructions] The first question comes from the line of Stamatios Draziotis with Eurobank Equities.

Could I start with one regarding current run rate and what you've been seeing at the start of the year, especially regarding IKEA, which is your flagship franchise. And maybe if you could share with us what your targets are for this year? I know the situation is -- the current backdrop is somewhat fluid, but I'm curious as to what you have budgeted in essence for 2025?

Yes. Thank you for the question. I will start with giving you a look -- an outlook of the market as reported by Elstad. And this is for 2024, Elstad posted that the clothing and footwear grew by 4%, whereas the furniture and electrical market was down by 10%. And this trend continues the first quarter of this year. However, in IKEA, if you take out the effect of the incident, we are -- we had an increase of 4% in volume, that's gaining market share in our business. And this continues in the quarter 1, and we are continue growing IKEA at single digit, of course, but it's continually growing month after month, and our first quarter results will show again for another quarter, a growth in IKEA. In sportswear market, this is even higher. And our first quarter results are significantly higher than the same quarter last year, going close to double digit, and this trend continues also in April. So we are growing in all our sectors, and this is the trend that we foresee that will continue.

Great. And are you keen to share with us any specific targets for 2025?

We are going to do that in the general assembly after having the first publish of the first quarter results when we will have a clear -- much clearer picture of how the year outlook is. Keep in mind also that we are not -- we are -- it's not the most easy times to make predictions under this external environment. However, we -- it is important to say that we are confident that we're going to deliver. We still reconfirm and we continue to confirm with the possibility of upside for our medium-term target, that is EUR 750 million and 8% EBIT IFRS 16 that we communicated to you a couple of years ago.

Great. And can I ask a final question on the cost side. The gross margins, as you mentioned, during your speech were quite impressive. Actually, they expanded materially in 2024, you referred to supply chain efficiency. So I'm just wondering to what extent these very high gross margins are sustainable and maybe a similar comment on OpEx, which were also contained in the context of the supply additions, obviously. So we didn't see much inflation coming through. If you could comment on that as well.

Yes, of course. What happened in the gross margin is that we had better prices, both in sports goods and IKEA. And these prices are unchanged in 2025 as we work. So we confirm the margin levels achieved because this is not based on onetime actions, but it's the new standards, the prices, the purchase prices we enjoy from our suppliers, plus all the measures we took to optimize our markdowns and inventory availability and so on. So yes, the margins will not increase further, but we'll stay at this level for 2025 at least. OpEx, we are optimizing our processes. We simplify the way we work. So we will continue -- the OpEx will continue growing below the growth of our profitability, well below our profitability despite, as you said, some -- the inflation in the salaries and be the increase in the cost of labor. Our efficiencies outperform these factors.

[Operator Instructions] Ladies and gentlemen, there are no further audio questions at this time. I will now pass the floor over to management for any written questions from our webcast participants.

Right. Thank you very much. I think the first question that we have, what is the outlook for gross margin, has already been answered regarding the gross margin. Regarding the smaller shops, Dimitri, would like to say a few things about the sales mix and the margin of that.

Yes. The smallest of concept works already well in Bulgaria and Cyprus. In Greece, we will open the first -- such a store in quarter 4 this year. Actually, it is an upgrade of an existing pickup point that will move from a pickup point to 2,500 square meters. And this is the first shop of the new generation in -- of a smaller shop in new generation, we're going to have in IKEA in Greece. So after the opening of this, we will have the first results how this works in Greece. And we will continue on with the full launch for the reaching 10 such stores in Greece by 2026, beginning of 2027.

Right. Let's go to the next question. Could you please explain on what basis you have given out 2% of the market cap of the company? Obviously, this question is referring to the stock grants and the stock options. Let me say, first of all, we have not given. The General Assembly has decided to provide these incentives and these rewards to the top management, the top management, which comprises of about 40 different individuals. Most of these, I would say, the 90% of the majority of these people between 2010 and 2020 during the Greek crisis had accepted a reduction in their salaries, had never before in the past received any kind of stock option plans or stock grants. And the management and the Board of Directors deemed appropriate to propose to the General Assembly and to the shareholders to reward these people, not only for their past performance and hard work during the Greek crisis, where a huge number of Greek retail companies went bust, but also to provide incentives for these people going forward. So for me, as Chairman of the Board and speaking for the Board, I think the Board did very wisely to propose this to the General Assembly and the General Assembly, I also believed it very wisely to approve these programs. Regarding the second question, the company is now cash rich. You would have a great capacity to buy back shares. Please give evidence that you had run detailed calculation regarding buyback versus investing in new stores. The existing buyback program ends in June with the General Assembly that we have in front of us. And the Board intends to propose a new buyback program in order to increase the remuneration of the shareholders. However, let me say that the management and the Board have as their obligation to plan for the future as long or -- and also for the short term. We cannot postpone the opening of stores. We cannot accept to lose market share in a market that is under a lot of pressure just to go and do and have share buybacks. We will have a balanced spending of our cash between investments and before -- and between shareholder remuneration. Okay. We have another question regarding gross profit margin. I think we have covered that.

I said that part, the shareholders...

Okay. Now operating expenses grew faster than sales for all segments. What are you investing in? So...

I think the only area that our operating expense is growing is -- the operating expenses is not growing faster than our revenues, yes, but not our profitability. And our revenues, you take us a point of reference, the [ 1.6, ] which doesn't include -- it's not even the volume increase or it doesn't include the impact of the incident. However, our operating expenses grew below our gross margin evolution, and that's why we improved our profitability. And the only expenses that grew faster is the investment we did as we informed to you in the previous quarters in making a restructuring in Bulgaria and Romania, making impossible because we are focused in this market to have a profitable growth in Intersport for years 2025, '26, and we saw that starting to happen from Q4 last year. And as you see, the profitability of Intersport has improved in the second half of the year despite the impact of the incident.

I think, Dimitrios, if you allow me to add. Yes. As we have mentioned in the past, our target outlined in our 5-year plan is to reach EUR 750 million by 2027 with an IFRS EBIT margin of 8% or a non-IFRS EBITDA margin of around 10%. So the economies of scale that will come with increased sales with opening new stores, both IKEA, also Intersport and Foot Locker, will come to increase the profitability. So yes, indeed, you might see certain operating expenses growing faster in certain periods. But going down the line, you will see the economies of scale of increased sales helping a lot the EBITDA margin.

I'll continue and read the rest of the questions.

The decline of IKEA revenues.

Yes. In Q4 2024, your IKEA revenues declined by 5%, although you opened a new store. Does this affect your expectations for coming stores?

No. Because before the incident, quarter 4 for IKEA was running with a high single-digit growth. It was close more than 7%. The decline you see there with just the impact of the incident with a one-off item, it will not be repeated. So Q4 was a very successful quarter for IKEA despite -- at least without taking out the impact of the incident in terms of growth of sales. And again, the same happens in March and April, IKEA is growing more than 5%. Simply, what you see there, and you will see also in January in the first quarter results, is that IKEA, as we informed you, had a major hit of the EUR 15 million plus EUR 5 million we have in January each from the incident.

And how was Q1 2025 for IKEA? We already answered that. How much are you to invest in Holland & Barrett this year?

Regarding Q1, we believe that Q1 regarding IKEA and if we also take into account the repercussions of the incident for January, will end up at almost breakeven in terms of like-for-like sales. However, we are seeing within the quarter an increasing trend of sales, a significant increase in trend of sales. And we are optimistic that Q4 has already begun quite strong. Next week, we are opening a very important store. So we believe that Q2 will be an important quarter in terms of sales. Regarding Holland & Barrett, minimal investments this year. We're still testing the concept. So no significant investments besides a few stores and maybe a few shop-in-shops. And the outlook for 2025, of course, the outlook is for significantly increased sales and profitability, and we will issue the guidance in our shareholders' meeting.

Next question. The valuation is extremely low. The company is just a bit more worse than they included real estate by now. Is that something that Board and management is looking at? Are you considering to exploit this low valuation? Have you calculated the return of share buybacks versus investing in new projects?

As I said before, of course, we know that the company is undervalued. I believe that the deconsolidation process confused in terms of accounting a number of investors. Things are now going to be much clearer. And we try to balance the cash available between buybacks and also opening new stores in order to consolidate our position in the market. So we are not spending money in new projects without taking into account our position in the market.

The next one, thanks for your presentation. Could you please give us a color about CapEx needs for the year?

Of course, the CapEx needs for this year will be in the same range like 2024. That means between EUR 25 million and EUR 28 million. The majority of this goes to IKEA like 2024 because we have the new opening in Heraklion. And in sportswear, we have additional CapEx. So that's going to be EUR 2 million to EUR 3 million more than 2024 for the new activity of Foot Locker. So in total, versus EUR 25 million this year, our CapEx next year will be between EUR 26 million, EUR 27 million and EUR 29 million.

Questions. With the current tariff war, will you suffer or benefit from the restrictions between U.S.A., China and U.S.A., Europe?

Well, this is an important question, but it's very unclear yet because we have to wait and see what happens in the end, of course. Let me provide an example regarding a possible repercussion for us. For example, we import a lot of sneakers from Vietnam because Vietnam is a major producer of Nike, Adidas, et cetera. Now of course, Greece does not impose any tariffs on Vietnam. However, the changes in the supply chain that could take place because of the overall situation might increase pricing. On the other hand, there might be an increase in supply coming towards Europe that might suppress prices. So we are very careful regarding the possible repercussions. We have a wait-and-see attitude.

Next question. The share price is unbelievably underperforming all the other stocks from the Athens Stock Exchange. Is that a concern for you? Are you looking at share price performance? What do you think the underperformance is caused by? Is there any plan to distribute extra dividend or hold share buyback from the sales of Trade Estates? Wouldn't it be wise to prepare for a recession period or slow down by introducing a share buyback program?

Again, yes, indeed, as I explained before, we believe our share is more undervalued than it should be. The deconsolidation period has produced part of that confusion. We believe now with the new accounting of the company will be clear how the retail and the other activities are performing. And yes, we would propose a share buyback from also the sale of trade, but no extra dividend at this point. So it's the dividend and -- the increased dividend of EUR 0.15 per share plus the new share buyback program that will be proposed to the general assembly.

Next one. Congratulations for the results. Two questions from my side. One, IKEA gained market share increase last year, but why you believe the home furnishing market increase was weak last year? What is your view for this year and over the medium term? And second, how the remodeling of the IKEA store in Athens International Airport is impacting performance?

Okay. Thank you for the questions. They are pretty very good questions. Last year, the home -- not only furnishing market, but the home accessories and furnishing and electronics and white goods market in Greece decreased in terms of value by 9%. These are the statistics that just came out. We, of course, outperformed the market. The big -- and we will continue to outperform in the market even this year. The big question is, why was the market down last year although the sporting goods market and the footwear market and clothing markets were 5% up last year? Now we believe that the increased inflation in food and in rents are putting pressure on the average household. Therefore, they are spending less on durables. This is the only way we can explain these results of the market. Again, however, we are opening a new IKEA store in Greece, which is, I would say, the third largest metropolitan area in Greece. And we have not been present there only with a small store. So we will increase our sales through that. And the remodeling of the IKEA store at the Athens Airport is impacting performance very positively. The store this year has very strong double-digit improvement.

Next one. Number one, what was the contribution of the new IKEA in Patra in Q4 of 2024? And secondly, how is volume growth for IKEA in Q1 of '25, excluding this new IKEA?

Contribution of the new IKEA in Patras was very low last year because it opened at the beginning of October, and then we have the incident. So it didn't affect the results. The Q1 of IKEA was overall flat versus last year. However, as Vasileios said, at least this is mainly due to the January results. So that was the last effect of the incident. March was growing high single digit, and April is growing double digits. So we are -- this -- the -- every month, IKEA seems that it's catching up. And we -- this we expect to continue ahead of us.

Now regarding the mix and the margins of the small shops, I think we didn't answer that before. Regarding the margins, I think...

The margins of the small shops, they are slightly less than 1 or maximum 2 percentage units compared to the big stores, of course. But nevertheless, all of them are above the 8% EBIT target that we have for us minimum performance for any business that we are investing in.

And the mix of the smaller stores, the market hall items?

The market hall items, it's much higher than in the shops [indiscernible] in the smaller shops is lower, that's why the gross margin is lower. But the prices would be the same. However, the product mix, it's going to have an impact on a slightly less gross margin, and this will have -- but the profitability is very acceptable and very much in line, and this will have a positive impact to the overall results.

Yes. The -- again, to further expand a little bit on the smaller shops based also on the Cyprus experience, you have to understand that the larger the store, the more furniture we can accommodate in the store. So it is normal that smaller stores have a smaller participation of the furniture in their mix. That is why also their margin is a little bit smaller because the so-called market hall items, which are the glasses, et cetera, et cetera, have a little bit smaller margins.

A follow-up from a previous question. What do you mean by balanced split between new investment and shareholder remuneration?

Yes. Right. So depending on the decision that the shareholders' meeting will take and by this, I mean the percentage of the buyback. For example, whether we will buy back 5%, at 4% or at 6%, this will also, let's say, formulate the amount that will be spent on the buyback. And at the same time, there are certain new investments that have to be made like new Foot Locker stores -- so the need for new stores because you have to understand that we have accepted certain obligations regarding the growth of Foot Locker, for example. So the balance between what we have to do for growth and also the amount that will be decided to go for the remuneration of the shareholders through the buyback.

Are you looking at all the market development and potential crisis development? How does it affect you? Wouldn't it be wise to have the shareholder buyback? I guess, it means in place now, the company potentially could buy back shares cheaper, and that is in the interest of all shareholders.

Well, the only thing I can say is that the Board has decided to make the proposal in our regular shareholders' meeting. And yes, indeed, there is a share price performance motivation in the remuneration program.

Moving on, how does the incident spill over in January 2025 if it happened in November of '24?

Yes. Well, it actually happened the last week of November '24. And our first priority was to have our -- all our activities open, not maybe at the full service level, but [indiscernible] shops was closed apart from the first day in IKEA. And the recovery of the back office systems, which is important to have the real-time availability of the inventories to run completely the e-commerce business took a little bit longer and to close the result -- to close the books of 2024. That's why it spilled over to January, which is -- but the impact was much less. EUR 15 million was in December and only EUR 5 million was in January.

Okay. We are finished with the written questions. Let us get back to the audio in case there is an extra question, and then we are good to go.

[Operator Instructions] Ladies and gentlemen, there are no further questions at this time. I will now turn the conference over to management for any closing comments. Thank you.

Thank you.

Thank you very much for this discussion, and we're looking forward to discussing again at the half year results.

Thank you.

Ladies and gentlemen, the conference has now concluded, and you may disconnect your telephone. Thank you for calling, and have a pleasant evening.