Haypp Group AB (publ) ($HAYPP)

Welcome to Haypp Group Q1 2026. [Operator Instructions] Now I will hand the conference over to the speakers CEO, Gavin O'Dowd; and CFO, Peter Dely. Please go ahead.

Good morning, everyone. -- and welcome to High Group's Q1 results. Our CFO, Peter Daly, and I Gavin O'Dowd, will take you through today's presentation. Starting on Slide 3, which is the agenda for today. I will take you through an overview of Haypp and the Q1 performance highlights and Peter will take us through the consumer, financial and segment performances before I progress on our key strategic priority markets. and an outlook. I would like to take you to Slide 5 to remind you of some of the key dynamics around our business. We are a retailer of risk-reduced products with a strong focus on nicotine purchase which, as of today, make up approximately 70% of our sales. We have multiple store fronts per market, and we offer -- and we operate in 6 markets in Europe and in the U.S. Approximately 90% of our revenue comes from product sales with the sales of Media & Insights to brand owners accounting for just over 10%. While jurisdictional complexity around the sale of nicotine is often viewed as a hardship, given our expertise and scale, we view it as a barrier to entry. We target to approximately double our 2024 revenue by 2028 and increase our 2024 EBIT by 3x to 4x. Moving to Slide 6. The scale of market growth potential in our existing geographic footprint is determined by the U.S. and the U.K. While the U.K. is a distant second, it has some very favorable long-term dynamics. Continuing on to Slide 7. The U.S. and the U.K. are also the 2 markets with extremely low online penetration rates, reflecting the early stages of the category life cycle. Hence, these are 2 markets, which we have dedicated significant resources to in recent quarters, and we will touch on this more throughout the presentation. Moving on to our quarterly performance updates and starting with Slide 9. We are happy to see continued acceleration in nicotine pouches, not just for the quarter as a whole, which grew 40%, but continued acceleration within the quarter. Both reporting segments performed exceptionally strong with the growth segment, reflecting the scale of the opportunity in the U.S. and the U.K. And in addition, the core segment showed that even but our high market shares, there is still opportunity for additional market share growth. In the past 3 years, Nicotine patches have increased from 45% of our group volume to approximately 70% today. Moving to our performance highlights on Slide 10. We An increase in active customers was the primary driver of our growth. However, increases in the share of wallet further added to the growth. This is reflected in the higher growth rates for volumes than for consumers. Combined, this led to over 24% revenue growth at constant currency. The performance in the growth markets was exceptionally strong with 83% increase in volume driven by over 120% growth in the U.S. and over 100% growth in the U.K. And at constant FX, led to a 58% increase in the sales for the growth segment for the quarter. Gross profit was up 20% with a stable gross margin. This consisted of substantial increases in the Media & Insights, which was reinvested into the consumer offer to further accelerate the flywheel. We have materially increased investment in the U.S. and the U.K. in terms of capabilities. This, combined with increases in marketing expenditure, while the window to do so remains open has led to a reduction in EBIT margins, which we expect to continue for the remainder of this year before extending back towards our 2028 guidance of 5.5 percentage points. On Slide 11, we show the actual performance of each of these KPIs and the relative change versus prior year. These reflect the drivers of growth both increasing consumers and the further increase in orders and average order size. With that, I will hand over to Peter.

Thank you, Gavin. Good morning, everyone. Let me move to the column section and starting on Slide 13. In this slide, we are highlighting the continued strength in our consumer base during the first quarter. Active consumers reached a new all-time high and grew by 17.8% on group level. We have 2 reinforcing trends, rapid growth in growth markets, supported by core markets turning into growth. The real standout is the growth segment. Active consumers increased 66% year-on-year, driven primarily by the U.S. and U.K. Our marketing efforts in these markets are showing clear early traction with strong conversion and repeat purchase behavior. In core markets, active consumers grew 5% year-on-year, which is a meaningful improvement compared with the declines we saw earlier last year. This is driven by a growing number of nicotine pouch consumers and stabilizing smooths consumer base. Overall, the momentum we are seeing in both core and growth markets gives us confidence that our consumer acquisition strategy is working, paired with sustained strong retention and that we are building a strong foundation for continued volume and sales acceleration. Moving to Slide 14. On this slide, we are showing the continued acceleration in nicotine pouch volumes across the group. Nicotine pouch is now make up 69% of our total volume compared with 45% in Q1 2023. That shift in mix is a major structural driver of our long-term margin expansion. Group nicotine pouch volumes grew 40% year-on-year, which is a clear step-up from the mid-teen growth rates we saw through most of last year. The U.S. and U.K. remain the strongest contributors, both delivering triple-digit growth. Our core markets also performed well. Nicotine pouch volumes grew at high-teen rates taking market share, and nicotine pouch now represents more than 56% of core volume. Smooth declines continue to moderate helped by improvements in our consumer offer to cater for mixed category purchases in Swedish households. And while the U.K. with discontinuation affected the vape and heat not burn category, we saw strong growth in Germany and Sweden. These 2 markets together up by 119% versus Q1 last year. Overall, the category dynamics remain very supportive and our scale positions us well to capture the ongoing shift towards reduced risk products. Moving into the financial performance section, Slide 16. Before we go into the quarterly performance, I would like to touch on our increased disclosures, which we have introduced this quarter. We recognize that as our business grows and the importance of our growth segment increases, some of you may wish to have more information to better understand our performance. For this reason, we are disclosing group and segment total volume and share of nicotine pouches, gross profit by segment, group sales by revenue stream group overhead cost breakdown by marketing, fulfillment and G&A costs. We have also folder emerging rep and heat not burn segment into the other 2 segments as they have moved out of introductory stage and are now being managed by the local teams. Since Vape U.K. was shut down, this leads Germany, which will be folded into growth markets and Sweden, which will be folded into core markets. For transparency purposes, we will continue to provide details on their performance. See the Q1 2026 report and the published KPI file for full details and historical data. Moving to Slide 17 and looking at our net sales momentum. Net sales grew by 19.6% year-on-year. And when we adjust for currency effects, growth was even stronger at 24.3%, making this the highest constant currency growth rate we've delivered in the last 6 quarters. The SEK 180 million absolute year-over-year growth is the highest quarterly growth we ever achieved. The negative FX translation impact is mainly driven by the SEK to U.S. dollar translation with NOK's contributing as well. On the macro level, you can see that our top line grew faster in constant currency than our volume. The positive mix impact is driven by Media and Insights revenue which continues to grow faster than our product sales. What makes me particularly happy that all critical parts of our business contributed to this excellent result. Looking on the different product categories, we can see that nicotine power remained the key growth driver. Considering that nicotine pouches makes up almost 70% of our volume, strong growth par with increasing share of sales creates a positive mix impact on our overall sales performance. Within nicotine pouches, U.S. and U.K. are the key growth drivers with solid mid-teen growth in our core markets. Price/mix for the nicotine pouch segment was negative in the quarter, driven by the U.S. business unit. Without going too much into the details now. I would like to highlight that the promotions are driven by manufacturers, and this is a margin neutral for us. There is an offset in all cost of goods sold. Our smooth sales stabilized and after a few challenging quarters in 2025, the decline is slower than what we anticipated in our Capital Markets Day outlook. The improved performance is mainly driven by a targeted improvement in our consumer offer in Sweden to better cater for household purchases, better mixed snus and nicotine pouch order is common. Wave and heat not burn products reported sales increase contributed by 0.8 percentage points to the overall growth, which is an exceptional performance considering the negative impact of the U.K. vape and heat-not-burn discontinuation. Sweden and Germany volume, as I mentioned, was up by 119%. Moving on. to Slide 18, gross profit and gross margin. First time ever, we delivered gross profit above SEK 200 million in a quarter. It's a major step-up in absolute terms. Gross profit growth is in line with our net sales growth. Gross margin remained stable, a marginal increase of 0.1 percentage points was realized. Retina gross margin, we experienced 2 opposite impacts. The fast growth of Media & Insights across all of our markets increased the gross margin level by 1.7%. Media & Insights accounted for 11.6% of the group revenue in Q1 2020. The incremental benefits from Media and insights above last year were partly invested into a consumer offer in the form of targeted pricing and free shipping offers resulting in a 0.1 percentage point increase in our overall gross margin. On Slide 19, you can see the details of our overheads. Over has increased in the quarter, and this was fully expected. In order to better understand our overhead base, starting from this quarter, we are breaking it down into the 3 important elements. Marketing, fulfillment overheads and the pure G&A. Marketing spend increased as we leaned into consumer acquisition, while the opportunity window remains open. Our paid marketing efforts are concentrated mainly to U.S. and U.K. In U.S. and U.K., we see substantial increase in our new nicotine pouch consumer acquisition rates. Fulfillment overheads reflect the labor cost, utilities and other external costs connected to our own warehouses. This cost category grew slower than the volume. Cost up by 17% versus 23% volume growth, which shows that scale benefits accounting to materialize. In G&A, you can find the salary of the office population and external costs like legal and tax advisory Audi license fees, et cetera. The primary drivers for the increase were our organization are beared out in the U.S. and U.K. and central organization around AI. We also recognized costs connected to building up operations in new geographies, which will benefit the group in the medium term. We expect overhead intensity to moderate as revenue scales through midterm. Moving on Slide 20 and on adjusted EBIT. Adjusted EBIT for the quarter was SEK 27 million, with a margin of 2.5%, down from 5.2% last year. This decline is fully aligned with our investment plan. We are prioritizing consumer acquisition and market share in the U.S. and U.K., and the growth segment accounts for the majority of the margin compression. We expect this investment phase to continue through 2026 with margin expansion resuming as scale benefits flow through in 2027 and and 2028. Moving to Slide 11, our working capital and leverage. Working capital improved meaningfully in the quarter, with inventory normalizing after the year-end store bed. Inventory turns and net working capital growth improved, supported by strong top line growth. Leverage remains very low at 0.2x. We remain disciplined in managing working capital, especially as we scale in the U.S. and U.K. Moving into the segments, and let me start with the growth segment on Slide 23. This is where we continue to see the most significant acceleration. Active consumers grew 66% year-on-year and total volume increased 71%. Both the U.S. and U.K. delivered exceptional performance with volumes up more than 100% in each market. This reflects strong category momentum, improved assortment and the early benefits of our organizational beat. Net sales in the segment grew 41% or 58% at constant currency. Gross margin remained stable at around 20%, which is a strong result given the level of investment into our consumer offer. The growth markets represents 28% of our Q1 net sales which is an increase of 4 percentage points versus Q1 2025. This shift is expected to continue into the future as well. EBITDA for the segment was negative at SEK 23 million. This is expected and reflects the deliberate investment phase we are in as we build local teams and skier consumer acquisition. These investments accelerate the long-term market share capture and are already translating into strong consumer and volume growth. Overall, the growth segment is performing in line with our expectations and is the primary driver of our long-term revenue and EBIT expansion. Moving to Slide 24 and our core segment. In the coal segment, we delivered steady and predictable performance consistent with the role this segment plays in our portfolio. Active consumers grew 5% and total volume increased 9% in driven by the nicotine pouch category and supported by improvements in the smooth consumer offer. Net sales grew 13% with rising orders per consumer clear signs that we are increasing share of wallet among our existing consumer base. Gross margin was stable at 18.1% and EBITDA increased to SEK 75 million. The driver for EBITDA margin reduction is the inclusion of the vape category. The core segment continues to generate strong cash flow and remains the foundation of our margin profile. Nicotine pouch penetration in the core markets reached 56%, up 3 percentage points year-on-year. This shift in category mix supports long-term margin expansion and reinforces the structural advantages of our business model. With that, I hand back the word to Gavin.

Thank you, Peter. I'd now like to take you through our priority markets. Moving to Slide 26 and the U.S. I would like to touch on how the market is evolving, how we are doing and how both are reinforcing our flywheel. Starting with the market. which continues to outperform the expectations we laid out in our Capital Markets Day early last year. Part of this growth relates to increased average daily consumption as more people use nicotine patches to completely switch away from more harmful products. This increase in average daily consumption moves a greater share of the market to consumption levels where the benefits of online become more appealing, particularly the price advantage, but also the breadth and assortment. The U.S. assortment continues to expand rapidly with new products coming to market, both via the synthetic nicotine path and via the FDA's marketing granted orders. We expect the FDA to grant authorizations for more new products in the near future. These dynamics greatly reinforce our economic flywheel as it has done in other markets, not just in terms of benefits for the consumer, but also with a notable increase in demand for our Media & Insights services. In preparation for the acceleration, we are already, which we are already experiencing, we have built out our local U.S. team to manage the scale. We continue to see robust growth in customer acquisition via our organic Google rankings or SEO, However, we're also taking the opportunity to add to our new customer inflow with paid marketing across select channels while those opportunities remain open. In summary, many of the dynamics we are now seeing in the U.S. are similar to those we experienced in our core markets at the beginning of this decade, giving us high confidence for the future. Moving to the U.K. In the next slide, Slide 27. The tobacco and Vips Bill received Royal Assent at the end of April, in line with our expectations and we expect secondary legislation to iron out the remaining details over the coming quarters with enforcement expected by mid-2027. The outcome of this legislation is expected to bring restrictions in marketing opportunities, which will solidify our online market position and reduce our marketing costs once implemented. In addition, as with all markets, which place restrictions on marketing, the relative value of media on our platform increases. In addition, we expect to cap on nicotine strengths in the market at the same level as Haypp have self-regulated to since entering the market. Ultra strong products are now estimated to account for circa 20% of the U.K. market. We have already enhanced our local team capabilities in the U.K. in Q1, and we will continue to accelerate the new customer inflow while the opportunity remains. Given the robust growth rates, we will automate our U.K. warehouse during this summer to facilitate future volumes. Moving to the next slide, Slide 28. There has been little change in either European regulation or Swedish litigation since last quarter. The Tobacco Tax Directive continues to be negotiated with a first draft expected this year. European Commission is preparing a public consultation on the third Tobacco Product Directive. Both of these directives are expected to undergo revision during the negotiation period for states. Regarding the Swedish litigation, Haypp is still awaiting a decision on the appeal from the Supreme Court. Haypp does not expect any material impact from this decision. Moving to the penultimate slide. In summary, volumes and sales growth is accelerating, predominantly driven by new consumer acquisitions in the U.S. and the U.K. We will continue to invest in marketing to accelerate our growth while the opportunity remains, and increases in our G&A costs are expected to slow throughout 2026 and scale for future years. We are happy to confirm that we are on track for our 2028 targets. And with that, moving to the next slide to recap on those targets, which were set for 2028. We expect revenue growth of 18% to 25% CAGR from 2024 at constant currency. And we also expect a 5.5% adjusted EBIT margin, plus or minus 150 basis points subject to the investment opportunities, which remain at that time. Before handing over to the operator, I'd like to thank the team for the great work in recent quarters, which led to the robust acceleration in this quarter. With that, I will hand over to the operator for questions.

[Operator Instructions] The next question comes from Alexander Silgistrom from Pareto Securities.

Congrats on a strong quarter and also appreciate the increased transparency here in the presentation and the report. Maybe a first 1 on the M&A growth in the quarter. Is it fair to say that growth was approximately 40% year-over-year? And could you also walk us through the main drivers here?

Alexander. Yes, absolutely. I think 40% is there or thereabouts on this as it works through. And with M&I tends to grow -- if we break it down into the 2 component segments of both media and insights, media tends to grow based on 2 pillars, which is as we get more consumers into the platform, the value of the existing media tends to increase in line with revenue or there or thereabouts. But in addition, we always develop new media products throughout the year, which we can also sell in the following calendar year. So this is the first quarter of that coming through. And then when it comes to insights, they also tend to grow on 2 pillars. As there's more and more payers entering the market, there tends to be more players looking to buy the existing inside services from us, but we also develop our insights offering throughout the year, which also creates extra products to sell to our existing consumers. And that's why we generally see the Media & Insights pace growing at roughly twice the rate of our overall group revenue, and this is no exception.

Yes. That's clear. And then on maybe just on the strong growth also in core markets, 14% here organically. Could you try to break out sort of the effects from lower structural decline in snus, sort of the lack late price decreases and also how sustainable are these growth rates?

Yes. So within Dovonex, the excise regarding snus without came through in Q3 2024. So we'd already lapped that by the time we've gotten to Q1 '25 as it came through. And that is part of the overall snus decline rates that we've been experiencing in the past. But what we're dealing with here are the primary driver, of course, there is slower declines in snus, but the primary driver of growth in the core markets is megaline pouches itself. It is accounting for the vast majority of the uptick in the growth rates.

Okay. So then it should be quite sustainable as well. I would presume and then maybe a follow-up also on the sort of rumored PMTA delays in the U.S. Do you have any news here? And also then the impact on the ramp-up in marketing investments into H2?

Yes. So I think you're potentially referring to an article which was released on Reuters a few weeks ago, whereby there was an indication of delay on it. I think that needs to be taken in conjunction with what the FDA have been saying another forum since then, which has been a lot more positive. And I think that may be reflected in what you may see from other of the industries quarterly reports, which came through so far this year. So I think there's a general expectation that the FDA will start to improve more products in the not-too-distant future.

Okay. That sounds reassuring. And then also on the gross margins here by segment. Thanks for breaking that out. kind of surprise that growth market carries higher gross margins as compared to core markets. Could you sort of explain that difference?

Yes. It's a -- this is more of a reflection of the dynamics within the markets. And I've often said in the past the hardest place to sell loser nicotine pouches online is Sweden. You have incredible penetration of stores relative to the population, and you have for historical reasons, incredibly low traditional retail margins in the physical point of sale as it goes through. So you're generally dealing with 20 to 30 percentage points of higher retail margins for offline in the U.K. and the U.S. versus what you're dealing with in Sweden and to an extent within Norway as well. So hence, that creates a lot more oxygen to be able to provide even higher price gaps in the growth markets than we do in the core markets, while still generating quite healthy gross margins. And this is what gives us the confidence to invest into those markets in the knowledge that even as we invest in, in the form of fixed cost and overheads through it, with those healthy gross margins, we recognize that it will scale and bring itself back to profitability quite quickly.

Yes. And then maybe just a final 1 on overheads. Just looking at the chart here, seems like you're then sort of lapping G&A in Q2 and in and that you're lapping marketing spend as well in Q3 and then, of course, you may increase that to further gain penetration. Is there a fair assumption on sort of how to see the development of the overheads here in 2016?

I think that when you are looking at the 3 components of the overheads, there are different drivers behind them. This is why we felt it's important to break it out and provide more transparency on this category. Looking at the marketing piece. There, as we indicated already, as long as we see good return on the invested money, we are more than happy to boost the consumer acquisition rates, particularly in the U.S. and U.K. and keep investing most probably even heavier during the second half of this year than what we are doing today. Looking at the fulfillment line as we can already see, that's a fairly stable element and grew lower than our volume overall in the categories. So I don't see any reason to believe that, that line going to change in any direction. And then going to the G&A. As Gavin alluded, we do expect the absolute growth rate of the G&A expenditure to slow down during 2026. And as our volume grows and the business scales, as a percentage of revenue, we do expect this line to normalize in the mid- to long term.

The next question comes from Mario Atsina from Barclays.

Just 1 from me on volumes. Obviously, great to see the 7% volume growth in growth markets this quarter. Just on Nielsen growth, I know it doesn't capture everything, but we have seen that volume growth of the category has been moderating over the last couple of prints. So just wondering your thoughts on this and if you think this is something that will be sustained.

Yes. So when we stood up in the beginning of 2025 at our Capital Markets Day, we gave out more conservative growth rates for the U.S. market than perhaps was generally expected by other players in the category. We consider we are tracking well ahead. The current size of the U.S. market is well ahead of where our expectations were when it got to that point in time. And our assumption is that the current growth rates in the U.S. are fairly reflective of what we can expect for the future. So I know there may be some views that the market will accelerate again and take a 1 more. But I consider it that this is -- given the current scale of the market, I consider current overall market growth rates to be quite reasonable at this point in time. Given our relatively small share as a company, given our relatively small share within the market, what we are more interested in is the driving forces of the future growth as in how much of it is coming from increases in average daily consumption of existing consumers versus new consumers entering into it. And what we can see is that there's more and more consumers moving up to the thresholds where our offer is quite relevant, and that's why we are seeing our growth rates in the U.S. coming in at 5 to 6x the growth of the overall U.S. market.

That's clear. And just 1 more on Nikitin patch taxes in the states. So obviously, we had about New York a couple of months ago, but there have been other reports of Iowa and use and perhaps other states considering introducing taxes on nicotine parts. Just wondering your thoughts on this and how you expect that to develop?

Yes. I think as the category develops, it is inevitable that taxes will be introduced at a state level, of course, much of the U.S. We envisage that between now and this time next year. there could be close to 20 states, which will introduce some form of tax on the product. And I don't consider that to be a -- once those taxes are reasonable. I do consider this to be a particularly negative dynamic either for the industry and especially not for us. At an industry level, first of all, this category is still incredibly affordable versus that of other negating products such as cigarettes. So I think there's lots of space to adopt the types of taxes which have been introduced New York, which you picked out is perhaps 1 of the most exceptional, it's 1 of the highest tax rates which is coming through and it's expected to be approximately $2 per can at this stage. When it comes to our position on this, we tend to benefit quite well when taxes are introduced in at a state level, a shock in prices, whereby prices go up by $0.50, $0.80 a dollar from 1 day to the next with in traditional retail tends to drive a lot of consumers to becoming much more price aware for a temporary period, and we tend to see a material uptick new customer inflow from those states as those taxes are introduced.

The next question comes from Daniel Tarian from Deutsche Bank.

I just wanted to quickly talk on a few consumer dynamics. One being, of course, active consumers were up. A number of orders were up, but the average order value was slightly down. Is that just a reflection of newer consumers tend to order less? Or are you also -- is that just more price heavy investment in discounts would be the first question.

Yes. So on that one, Daniel, you can see that while you're right, consumers are up Orders are up slightly more, volume is actually up slightly more again. So actually, what we can see is that, on average, the consumers are ordering even more in volume. So what this is when it comes to average order value, what you're seeing here is a reflection of what Peter was talking about in his space, which is that for some of the markets, the manufacturers are reducing the price to us which in turn has been passed on to the consumer, which is reducing the average order price per can as it goes out. So that's the remaining moving part when it comes to the average order value.

3 Okay. Awesome. And then the next question is on that slide regarding the U.K. and the ultra high strength users. You mentioned that's about over 20% of current volumes in the market. How -- if that rule does come into place and over 20 MG pouches band, how do you see those consumers transitioning? Are they likely to turn towards a liter sourcing? Or do you think they will move back down towards a regulated or approved nicotine concentration levels?

Yes. So I think -- so in summary, I think they will move back into the lower nicotine space. And let me give some context behind that. Many of these products, which are branded has been over 20 milligrams or products which have been developed a number of years ago. And while they carry excessively high amounts of nicotine, they're not always the best when it comes to negative delivery relative to the strength that sits within them. There are a range of products which have been coming from very credible manufacturers over the last 2 to 3 years, which are operating well below the 20-milligram limit, which delivers nicotine at a pace which can more than meet the needs of those consumers when it comes to satisfaction rates. So I think both as the consumer was going to mature and understand the category a little bit more, they were likely to start to move back down anyway. So I don't believe that these consumers will remain within the illicit part of the category. I think the vast majority of them will move back down in today or will be the legal part of the category in order because there's no -- there's no necessary nicotine release patterns that require them to stay where they are. The products -- the sub 20-milligram products have improved so much in the last couple of years that will more than meet their satisfaction needs.

Perfect. Okay. And then last quick question. Just conscious on Slide 7, that's the penetration slide from the CMD. So you may not want to give updated numbers on where online penetration in the U.S. and U.K. sit at the moment, but it would be helpful to know if there's -- what's that level of disconnect between the level of penetration and the number of consumers that are consuming at that critical threshold level that warrants turning towards the online channel?

Yes. So it tends to be -- there's an even more fundamental question, which I often go through my mind on this 1 as regards to what is the consumer. And of course, within some of the numbers that come out from the market on the consumer space includes people who may use 1 or 2 pouches a week down to people who may use a candidate as it goes through. So there's quite a spectrum here even on the definition of consumers. And then, of course, the share of the market, which is online tends to be skewed much more towards consumers, which are more heavily, which are more heavy users. So you can definitely see that dynamic running through on this one, Daniel. But we can see that definitely growing as regards to both the share of consumers, the average daily consumption increasing. And hence, the share of the consumer number and the share of consumption, which the online offer is rather than for. And that's why we're seeing the levels of growth rates as 1 of the main drivers why we're seeing the levels of growth rates that we're experiencing in the U.S. and the U.K. at this point in time. So we can see these rates growing rapidly at the moment, and we expect them to -- we don't have updated data which is -- which were sufficiently accurate for us to be comfortable with sharing. But we do certainly get a sense that this is growing quite rapidly as in online as a share of the market is growing quite rapidly at this stage.

And so -- because you mentioned both your share -- the share of online channel is growing and the number of consumers at that high level of consumption is both growing. I was more so asking, are you making progress in closing that gap?

Absolutely. So I think we're -- I think the share of online is -- I think those 2 are growing pretty much in line with each other, Daniel.

There are no more questions at this time. So I hand the conference back to the speakers for any written questions and closing comments.

There are no written questions at this point in time. So I'd like to thank you all for your time this morning. It's greatly appreciated, and I look forward to seeing you all for our Q2 results in August. Thank you very much.