Kamux Oyj (KAMUX) Earnings Call Transcript & Summary

Good morning. My name is Katariina Hietaranta and I'd like to welcome you to Kamux's Full Year '24 Results Presentation. We'll have our CEO, Tapio Pajuharju; and CFO, Jukka Havia, presenting the results. And after the presentation, we'll have a Q&A session. Thank you. Go ahead, please.

Thank you, Katariina, and welcome aboard. And I think the headline says it all. It was not an easy journey on the last quarter and the full year also was challenging. On the top line, we got hit and then also on the profitability. Once we monitored the market in our operating countries, I think I understand that the markets were not normal and then I think towards end of the year since October, both November and December were very exceptional. And then on the performance, I would say that whether half is market related, half is our own game; but there is own game we need to also improve. But the markets were not normal on the last quarter, that's in a way fair to say and I think we'll dive deeper on those ones. And today we'll have the Q4 in details, then we'll review the market positioning, look at the highlights and low lights and then the changes in our showroom network. We'll review the countries by each of them and then we'll have bit of a strategy look. Jukka will go through the financial development targets and then we share the outlook and then we have time for questions and comments at the end. So let's get going. All in all I think on the top line we were struggling, but that was not the main struggle. I think the main struggle was on the profitability. And in all of the markets, the way to operate and obtain metal margin was the most challenging. On our adjacent services we did a decent and good job, but the metal margin was the one which was in a way hurting the most. Then there were couple of cost elements, which also impacted unfavorably on that one. Then on the offering we have, I think you will see that the inventory levels on the value terms were higher and that's one of the challenges we had as our Kamux game. Later when we have look on each of the market, it seems that we had difficulties of obtaining lower priced petrol driven cars whereas we were a bit heavy on the higher priced and especially on the hybrids and EVs where we also had a good performance. But I think we were lacking the performance and the pieces of the lower priced petrol vehicles in all of the markets especially in Finland. That was one of the main drivers for the performance. Then on the positioning, we still remain #1 on the domestic marketplace. Sweden, we are on the Top 7 position. Germany, we are unchanged on that one. The markets are not equal and there were lot of changes on the market by market. And I think towards the end of the year, most of you who've been monitoring, you've been seeing what's happening in the new car business, what have been happening in the offers and the interest rates and then how some of the players have been slashing both new and used cars to the markets mainly in Finland and Sweden. Germany, roughly the same elements, but not to the same extent as seen in Finland and Sweden. Then on our team, we have strengthened our team. We have Joanna Clark joining us on the 15th of April, the recent announcement. We have Juha Kalliokoski joining the team 1st of March as the COO and he will take care of the operative selling and buying and inventory management in Finland, then for Sweden and Germany. That in a way enables the rest of the management team to work on the speeded up execution of the strategy. So we have more scale and scope for the strategy execution. Then for Juha's term, productivity improvement on the selling, buying and inventory management on the consequent markets. Johan Kempas joined us lately on January 1. He was onboarded during latter half of December, an excellent strengthening to the team. Then beyond the management team, we also have very good capable players joining in Germany. We have Sebastian Janik, who is our new Head for International Sourcing in the group. We have Michael Ungerer, who is our new Sales Director in Germany. Very capable individuals both. Then we have Joni Tuominen helping the Finnish operation as the COO and then a couple of other additions to the team. So we have strengthened our team making a speedier execution of the strategy, which in the current climate is definitely needed to become successful and become profitable again. The picture is roughly alike in the figures. The pillars tell the same. Top line was not the main challenge. The main challenge was profitability mainly driven by the metal margin. Adjacent services doing steady job, but I think we were lacking bit on the volume and that's why the insurance and finance were delivering not as good as in the past. Number of cars sold, we got hit on all of the markets. And I think on the value terms, Kamux performed rather well and actually was strengthening the game. On the pieces terms, even in Finland we were lacking the pieces and that's where we had an issue. I think we've been learning how to sell EVs, we've been learning how to sell luxury cars, we've been learning how to sell right price cars, but then we were lacking the economy level petrol cars in Finland. Roughly the same in Sweden. Germany we had a good offering, but we had other issues on Germany. Adjacent services: Kamux Plus, very steady, good development on that one. Financial as well, but then we were hurt by the volume and also the insurance, the same game. Store count, we've been changing and optimizing store count. Finland, we've been opening Hyvinkaa with very good results. Klaukkala and Tornio closed. We have obtained new showrooms in Espoo, 1 in Friisila which is going to be our flagship store for the capital region and then we got Petikko from Secto as well, which is going to be our Worx flagship for the capital region. And then closing Ylivieska combining that to Kokkola. And then we were at the very year-end on the last week of December closing Konala and opening in Herttoniemi, which is our now largest showroom in the eastern part of Helsinki and a very good start with that one. Sweden, we've been upgrading our premises in Sundsvall, Helsingborg and closed Norrkoping, closed Boras, Norrtalje, Heron City and then Gavle and Uppsala also closed. While we do that, we've been upgrading our Gothenburg store. It's now according to the Kamux concept. We've been now loading it with the cars and seems to be delivering a very good promising game in Gothenburg and that's our largest store in Sweden. Germany, we have opened Siershahn. We have closed Lubeck and Kaltenkirchen, which were loss makers and then we are having plans to open 1 or 2 stores during this year in areas where Kamux is not present for the time being. Finland, and I think we did a good game on the general thing, but we were lacking the lower priced and with the lower priced, I mean EUR 7,500 to EUR 15,000 petrol engine cars and I think that tells a bit about the consumer confidence. That's where the high demand is. The mobility for the people is what it used to be. They need to find an alternative car with a used car, but they were not able to spend on the EUR 35,000 to EUR 40,000, which seems to be now the most difficult one; not the most expensive, not the cheapest, but on that level and then especially the petrol engine car seems to be one. We have been rather good in EVs. We're also having a good game on the margin with the EVs. Hybrids the same. But then on the price level between EUR 35,000 to EUR 55,000, that's where we've been struggling a bit. And then the capital region game, we only get it better towards the very end of the year and the results are not -- we are not happy with the results in Finland. On the other hand, we know what to do and we've been addressing that. It will not happen overnight, but we'll get it better on the Finnish marketplace. Then where we have, I would say, success and which is also indicating about future gives a bit indication. On the customer satisfaction, we've been going up. We've been going gradually up. We already now know how it's going to be looking in the month of January. We continue on the very same trend. We have not been doing that with the cost. We've been doing that with our training and service. So in that respect, we are on a good trajectory on the customer service. Sweden, I think when we had storm and turbulence on the market, I think the last 2 months in Sweden were maybe even tougher than in Finland. Two of the main players on the Swedish marketplace, 1 with both on the used cars and new cars, were slashing inventory like no tomorrow and then even the largest player on the used car market had very, very, I would say, dynamic and aggressive actions, which were gradually hitting the market and hurting everyone on that platform. So we are not any better, not worse; but the market was really challenging on the Swedish game. What do we see in Sweden? We still have stores which are performing extremely well. But then on the other hand, we have stores which are clearly off the chart and we need to help them to become profitable faster and we have all the means to make it happen. And I think we believe we can make Sweden profitable. With Johan on the team, we have a good grip on that. It will not happen overnight, but can be done. Johan has been joining us officially 1st of Jan. We see the strong grip and strong experience in that respect and now I think we are building up a team who can make it happen on that respect. And especially on the used car business, now we have team who can deliver as well. It will take time, but we'll get there. Germany, we've been doing actually rather steady journey and a very, very good gradual step towards profitable growth. Then on the month of December, we were hit with the volume and that then became a deal breaker for making it happen. Then it's good to remember and I think Jukka will share it in more details when we go through the profitability and especially the way we distribute the financial services sales related profits. Now it's been distributed equally on a quarterly basis based on the time when we've been selling those and not the way we used to do that on the '23 when we posted all of that in the month of December. So that's the big delta on the profitability of that one. Germany, I think most of the people who follow car industry know Auto Motor und Sport also outside of Germany, highly respected media, they do mystery shopping. And I think at least to my knowledge, this is the first time we've been awarded 2 rewards from Auto Motor und Sport. One in Hameln, which is I think maybe not the largest store, but one which we've been renovating, making it very Kamux like. It's an old Audi [ hangar ], but now delivering excellent profitability, excellent customer service and also being recognized by the local media over there. Job well done. And the same in Duren, which is our first store in the South. They've also been doing excellent job. And this is mystery shopping and as you can see, it's a small amount of stores who've been awarded on this one. And this reflects the grip we have in Germany and I think going forward, we're going to see the similar type of execution in other stores as well. So we are on top of the game in that respect. Then I think our vision is unchanged. We are just on the podium. We are hanging in. We need to figure out how to speed it up and we were lacking the volume growth and I think Jukka will dive deeper on that one. Then on the '24, we were executing the Project Core and on the Project Core, the ones to remember; we had 2 parts. One is the productivity, which is mainly the way we operate and people related, that is fully in the pocket. Then the other half is car related, that is not fully in the pocket and we have some tail coming through for the second half of this year. Everything is going to be completely on the car-related cost. And then in order to improve and speed up the strategy execution, we have selected actually 4 points we're going to be putting lot of energy and effort. One is pricing and I think on the pricing, we realize with our volume both when buying and when selling, every single euro counts. Now we've been realizing and monitoring our way of pricing the cars, the way of buying the cars. We leave money on the table. That money we want to have in the pocket of the company and distribute it on the bottom line. That's what we're going to be working very diligently and hard on that. Then on our offering, I think in general we had a good grip on our offering, but we did not foresee the change towards the lower end so fast and we didn't see the change towards the petrol engine driven fast enough and we were lacking the inventory. When we found out that's the name of the game, we were late on the game and had difficulties of sourcing them. When having the opportunity to source, the margins were not even close to the Kamux standard margins. We elected not to do it. That's something we need to do clearly ahead of the game going forward. And then I think on what we call KMS, our ERP system, the process is excellent, but it has to be beefed up a bit. So it's flagging up things earlier and people are following the discipline to the full and that's where we are working. So these are the 4 points we are operating. And inventory management, which is one of the core competencies, we've been rather okay when you take a time lag of 120 days. But during the 120 days, you have multiple things you can do and I think we're going to do more dynamic inventory management, which is also reflecting on the pricing. And as a result of that, we're going to be able to have better metal margin going forward. Then I think I will pass it on to Jukka.

Thank you. So I'm going to go through some of the key numbers and metrics from the group total perspective so consolidated numbers. And like Tapio stated, of course we did have really difficult last quarter of '24 and we had all kinds of challenges in all the markets, but that is especially linked to the profitability because the top line, the revenue was actually quite close to where we landed in '24 and the real challenge has been on the gross profit. The gross profit was down by about 15% on average the whole group per car sold and that's quite a major decline and that had the consequences for EBIT as well. The other challenge on top of the fact that the margins were squeezed is the fact that we have been on purpose driving the inventory value, the average price of the cars up, especially in Finland. And we ended up the year, if you compare end of December '24 to end of December '23, having an inventory which is in Germany and Finland about 20% higher than it was a year ago while in Sweden both in pieces and in value we actually drove the inventories down. And that of course has led to the fact that the returns on the invested capital have gone down. Even if we sort of have tried to match the demand of the marketplace, like Tapio stated, we ended up having a mismatch and the mix we had on the inventory was not optimal. EPS, the net result of the net profit and earnings per share for the last quarter was 50% down from what it was in Q4 '24 and the same applies for the full year. So the full year '24 EPS landed eventually at EUR 0.12 per share while it was EUR 0.24 in '23. And finally, like we have announced earlier, we did go through a refinancing process. So that was finalized and at the end of '24, the debt on the balance sheet that was refinanced, we have 3 plus 1 plus 1 year debt facilities in place. So we have the ammunition. However, of course now we have to be careful managing both the balance sheet as well as the profitability going forward. Looking this from a pure number perspective, these are the tables. In the middle you see Q4. On the right hand side you see the full year. The revenue for the full year for the second time in a row was just above EUR 1 billion. There's a little bit of a growth in value so close to 1%. However, the further down you go the P&L, the worse it unfortunately looks. And for example for the Q4 so even if we were only down by 2% in euro terms in revenue, the gross profit went down by 22%. And adjusted operating profit for Q4 was EUR 0.7 million while we had EUR 5.5 million. So it's a major decline and that of course affected the full year profitability as well. So end of the day, the full year adjusted EBIT was EUR 11.6 million, that's 1.1% of the revenue. Finally, inventory turnover, of course when the inventory value went up, we were not able to sell, was also about 20% worse than what it was a year back. So we ended up having on group average 55 days in inventory outstanding while it was 46 a year ago. So towards the end of '24, lot of these metrics went unfortunately to the wrong direction. The equity ratio was quite close to where we were so that's still around the 50% mark. And now here you see for 3 years, '22, '23, '24, end of the quarter's net working capital on the left hand side, inventory on the right hand side and the inventory value went up by almost 12% driven by Finland and Germany. So even if in Sweden inventories declined, still we had much more capital tied in and that then of course led to the fact that we also had end of the year more interest-bearing debt on the balance sheet. And that is the key driver, the change in inventory is the key driver for the fact that the cash flow for Q4 and cash flow from operating activities, which you can see here on the left hand side, was EUR 14.8 million, still clearly positive. But if you look at what we had '23 and '22, there's a major decline. So now the capital is tied on inventories and now into the '25 we then have to manage. The inventory turnover is one of the key metrics and part of these focus points that Tapio mentioned in the strategy execution and that applies to all of our markets. And that then leads to the dividend proposition. The Board of Directors have yesterday decided to propose to the AGM; the AGM will be held 22nd of May; that we would pay a dividend of EUR 0.07 per share out of the EUR 0.12 EPS, which would imply about 58% payout ratio. So that it would be paid in the autumn and so that it would be paid based on Board's discretion and it's maximum EUR 0.07. So in reality it's anything between EUR 0.00 to EUR 0.07 and it's up to the Board of Directors to decide in autumn '25. So that is the proposition towards the AGM to come. Last year, so from financial year '23 results, we paid out EUR 0.17 per share, quite close, same type of payout ratio, but it was split into 2 tranches. The first tranche was paid after the AGM in springtime and the second tranche was paid in the autumn. Now the proposition is to pay all of it out end of the year, the second half and secondly so that it will be fully at the discretion of the Board of Directors. And with that said, I think going forward, Tapio, you maybe can jump into the longer-term perspective.

Yes. That's something discussed before the meeting as well. They are unchanged. We are on the journey of going for 100,000 cars, revenue off of this and then the EBIT target is unchanged of 4%. We are a bit far off on that one. We know how to improve the game and I think domestic marketplace we know what to do. Sweden, we have a long journey. We started with a negative one. Germany, we are getting closer to the breakeven and going to go above. Then on the NPS, we are actually good trajectory on that one and good development. What is the outcome on the early first month of this year, we're going to be good. eNPS we are still low, clearly below. We are 1 notch up. We used to be on 6, now we are 7. Finland is way better than this one. We still have issues in Sweden and that's reflected on the number for the group. And then for the outlook of '25, we expect that adjusted operating profit will be exceeding this year and then repeating what we had on this one. Really challenging period, especially the Q4 and especially 2 last months of the Q4. Top line not where we want to be, but close to prior year. Profitability due to the metal margin not where we want to be. Inventory higher up than we want to be, lack of the lower level petrol engine cars. Now we know what to correct and correcting, as you know, will not happen overnight. But I think in our way of business where the stock rotation is still rather high, can see visible results rather soon. Now time for questions.

Now time for questions. We will begin by questions from the teleconference line. Please go ahead.

[Operator Instructions] The next question comes from Maria Wikstrom from SEB.

This is Maria Wikstrom from SEB. I had few follow-up questions. So first of all, I think you mentioned that the post-sale repair costs, they were up and hurt the gross margin. And I was wondering that have you discovered that the pricing of Kamux used product has not been correct as you are getting more of these after-sale service costs or how would you describe the situation there and how do you prepare yourself better for these repair costs in the future?

If I've said that, then I delivered the wrong message. Actually the after cost is going down quite nicely. Pre-costs have been going up. We've not been able to limit as we had under Project Core. Now we have a way how to do that. The people who are buying the car, they are estimating the pre-costs and we follow up how good they are on the estimation and then I think we also set certain limits how to do that and the same applies for the after cost. But the after cost, we've been actually going quite nicely down on that one. Pre-cost is the issue where we need to focus and then we've been trying to consolidate the partners with whom we do the pre-cost. We are halfway on the process of having the right partners and having the right price level with the partners.

Then I wanted to ask that now during the Q4, you saw that there was a great demand for cheaper gasoline cars. So obviously I think I mean you've been quite many times hurt by changing customer preference I mean on a very quick time. So how you can prepare yourselves to be more agile to the changes in customer preference and read probably the market more correctly so that your inventory will be positioned to current customer demand?

I think that's part of the S&OP process, which I think has been more indicative. Now it's going to be a decision-making process. We have our own data based on the KMS. We see what is moving where we book the margins. Then we have the market data, which in the car industry is very accurate and online. We just need to make faster decisions based on the data, nothing else.

Okay. And then I think you sounded I mean quite positive, Tapio, in your statement in the report about Sweden and you saying that you are confident that you can return the operation to profitable levels. So what makes you so confident that you can actually turn Swedish operations to black figures?

We still have lot to do, but I think we know what to do and we have great examples of good performing stores. Then at the other token, we have the bad performing stores. We have an idea how to lift them up and then we still may need to consider closing some of those if we cannot make them profitable. Now we have collecting a team who can do that and I think Johan's grip and then beefing up his team can do the job.

Okay. And then finally, given that you made some changes in your organizational structure and you appointed Mr. Kalliokoski as Chief Operating Officer. But then at the same time that the Board is basically the boss of the CEO and Mr. Kalliokoski still sits on the Board. So how does this reporting structure really work that you will be the boss for Mr. Kalliokoski who then will be your boss I mean given that he sits on the Board?

I think time will tell. We have no experience on this one within Kamux. You see this type of arrangement in some of the companies where the founder is a big shareholder and operating in the co-op area, you see this actually quite often. Time will tell. We've been working with Juha in the past. The other way around, I was in the Board. We had a nice good relationship with him. He's a capable professional in his territory. So I don't foresee any major issues and I think we can work together quite well.

The next question comes from Calle Loikkanen from Danske Bank.

I have a few ones if that's all right. If we start with the inventory and perhaps the inventory today, how does the inventory today match the current demand? So basically asking that you will struggle with top line and margins also in Q1 and onwards.

I think Q4 was not only the inventory, it was the market and the inventory. Markets are similar for everyone so that's something we cannot change. So the market will prevail as it is. Our own inventory we've been addressing it and we are gradually going towards a more suitable fit for the market both in Finland, Sweden and in Germany. And I think the way to obtain metal margin, we are in a better shape, but the market is still the market.

Okay. All right. And then I was wondering about the Q4 and obviously based on at least my calculations, you lost a bit of market share -- quite a lot of market share actually in Q4. I was just wondering that can you give any color on who have actually won market share in Q4? I'm not asking for any specific names, but perhaps more broadly that is the small players or the big players or who has been gaining market share?

It varies market by market. On the domestic market, the ones who've been having a good trip and good availability of the lower-end petrol engine vehicles, they've been gaining pieces. And then in Sweden I think it's been buying market share, which is clearly not profitable and not healthy. I would not count that. The main players have been either forced to do that or been doing it with their own will; but in any case, it has not been a healthy way of gaining market share. Germany, it's everyone. If there's 1 phenomenon which is fair to highlight, I think the branded dealers, the ones who have big brands in their pocket, they have had in a way automatic supply of some of the needed cars. They have been gaining some share and most likely with a healthy and profitable way then what is the outcome of the others on this one is still a mystery. And I think we're going to see the numbers when some of the nonpublic companies will go out with their P&L and filing it. I think in Finland, it's towards the summer. Sweden, roughly the same time line. And in Sweden, the ones who monitor the Swedish marketplace, I think there are more than 100 companies going out of the business and no longer playing the game. So it's an automatic consolidation. We have seen that in Finland, but in a clearly smaller scale. Germany roughly the same, but not the scale like in Sweden.

Okay. That's very, very helpful. And then I was wondering about the market overall. I mean obviously very challenging, but has the market changed now in January, February? Are there still a lot of aggressive offers on the market and so on?

Yes. Maybe still I forgot to say 1 thing. On the pieces, Kamux has lost market share. On the value, not so much and I think we've been gaining in some of the areas value. Commenting on the marketplace, I can only comment what is visible only. If you go to any of the social media, open any magazine, any other media, you still see lot of interest rate offers. You see some of the car offers, which are, I would say, strong, maybe no longer aggressive, but strong. And I think some of the inventory cleanup is happening by some of the players. It's in a way easing up and then I think we are gaining strength and speed towards the season, which is soon to start. But still some players are playing with the tools which are normally not used.

Okay. That's clear. And then I was just wondering about kind of your thoughts on -- and now talking again about the pieces not the value, but the pieces of cars. But when do you expect that you have made sufficient changes in your inventory and your offering so that you could actually go back to gaining market share rather than losing it? Are we far away from that point?

I think in theory when we look at our rotation times, we say that 6 weeks should be doable. In real life, 6 weeks is not doable because you have still -- you have the ones which are moving very fast and then you have the long day stock. But I think we are talking about weeks.

And now we are ready to take questions here from the audience before moving into some of the questions we have received from chat. Any questions here? Pia?

Pia from Carnegie. A few questions and I'll start with the increased maintenance and repair costs. So could you still clarify is this a result of inflation, a business mix or something else?

I think inflation. When you see what the workshops are charging for certain things both on the spare parts and on the hours, that's clearly gone up and then our ability to estimate how fast it's going to go up has not been perfect. And that's why we have taken the -- when buying the thing taking the pre-cost estimation very, I would say, vocally and strongly and start to follow how good we are on that and it has a major impact on the pricing of the car. And then I think the other thing is that we are still in the used car business and that's the area which is in our own control, how good do we repair the car. When we are in the used car business if it's a car which is 3-year old, we would need to accept that there are certain scratches on the bumper. When it's a 1 year or younger car, it should be perfect. And that's where we need to have a good grip on how to make them sellable with a standardized way.

Then regarding your network in Sweden, you say you are critically reviewing your network and I don't know if it's specifically Sweden or the overall network still. But does this mean that Kamux will continue to contract before growing the network again?

I think we have certain stores we are monitoring very closely whether we can make them profitable. If it's so, we'll continue. If not, then we need to close. On the other hand, we know that we are clearly underrepresented in the Greater Stockholm area. So that's under [indiscernible] or something we need to do over there. But I think we will not open before we have the current capacity in a good shape. And then also in the northern part of Sweden beyond Sundsvall in the north, there is a big market, actually very lucrative market. We are not there and I think longer term we need to be there. Then regarding Finland and Germany, we still have some areas where we are addressing the optimal network, we'll need to make decisions. And in Germany, we are in a need to open 1 or 2 stores this year to make it scale in Germany.

Then if I continue still, you say you believe it's possible to make the Swedish business profitable. Do you dare to say anything about the time line?

That's something we will come back later. Now we have Johan and the team on the game. We know what we are doing. We will see how fast the management will be delivering results. But already we know that some of the stores we've been able to beef up and make rather good. Then the question is how we can lift up the bottom end of the stores faster than in the past.

And then still if I continue with the guidance. So listening to you today, should we understand that it's really H2 weighted in terms of earnings growth?

I think we give guidance for the full year of '25. So it will come during the year.

And then finally, if I can, I have 2 more questions still. Regarding the change in management and appointing Juha Kalliokoski to the CEO. Is this a change driven from within the company or is it a change driven by the Board?

We appointed Juha Kalliokoski as COO, not CEO. It's a common decision. And I think we know Juha from the past and also as a Board member who knows how to buy, how to sell cars, how to manage inventory and how to increase the productivity of the team. That skill set we have a need for that and I think we could have that also outside of the company. But once we have an individual in, it's clearly faster, we know the individual. So it's a safe choice in that respect.

Sorry for misspelling. Right. Then finally, regarding your dividend commitment. So should we understand that the dividend can be 0 this year?

I think the most important thing is that we're going to stay in the business. We have all the means to be successful in the business. And then I think our intention is to pay the bonus, but it's for the Board's discretion to decide do we pay or not.

[indiscernible] I do understand that profitability is the main challenge, but coming to this CMD EUR 1.5 billion sales target, reaching it in a reasonable time requires high single-digit growth several years in a row. So how that sounds?

I think when we set the target, we said it's mainly organic and on top of that we may have nonorganic activities like M&A, acquiring something, adding up.

Rauli from Inderes. A few questions from me as well. On the lower priced cars, which you haven't been able to source enough, I think this was not the first quarter that happened. It happened also earlier last year and the problem seems to be that you are not able to kind of buy them so that you could make money. So can you give some kind of concrete things what you will make to correct that assuming that the market will remain as tough as it is?

We have already changed couple of levers on the lower end between EUR 7,500 to EUR 15,000 petrol engine cars. We have first of all changed the salary model for the people who are buying it. So it's more motivational for them to buy that because they used to only get on the margin and the margin they will not earn as they would like to earn. And then at the same token, we've been increasing our trading power for that. And then on top of that, since -- let me now think what is the day, but it's on the website as well and on the social media and everywhere. We are open from 10:00 till 10:00 for the people for selling the cars except on Saturdays and Sundays we are until 9:00. We used to be 5 days a week office hours and we'll be beefing up the team. We have a new team leader on the consumer purchasing team in Finland and we are also then using Webcars in Sweden to help us on that. So I think we have lot of levers how to get there. Still the sourcing of these cars is not automatically easy.

And what's that compensation model you mentioned? Was that changed earlier kind of to the different direction when your strategy has more emphasized the higher value cars?

We changed towards more on the margin made and for sure you have the higher margin on the higher priced cars and it's more lucrative for the individual buyer to go for that. Now we make it in a way equal for them whether they buy that or this.

Okay. Good. Then I have to come back also to the appointment of Juha as the COO. Can you give some practical example also from that? You say that I guess you, Tapio, will kind of focus more on the strategy execution, but it seems the reporting lines for all the countries and operative actions will go to Juha. So what will your role actually mean then in the future?

Not only me, I think we have the team who will work on the Kamux concept together with we will work on the offering, which is the S&OP. We're going to work on the digital and the KMS. And then we will -- this is, by the way, Jukka's last show. We are very unhappy that he's leaving, but he's leaving and so we're going to be appointing a new CFO. So working on that metrics. Where Juha is very strong is on the operational buying and selling and getting the productivity on the country level on a monthly basis, weekly basis, daily basis, hourly basis. And that's where his focus is and I'm very happy that he's joining the team.

Okay. Great. And then I could handle 1 question to Jukka as well. You have been silent so Jukka, you can say something. On the efficiency program, you mentioned that the personnel-related things are in the pocket. So were those fully visible already in Q4 or is there something to be gained kind of still from beginning of this year?

Well, if you look at from the cost incurred perspective, the action was done in '24 from that perspective, yes. If you think about the benefits we gain, some of that will flow into '25. But you can say most of that was done. And that is sort of the second or the other half of the program because roughly 50% was linked to the premises and the staff and that was linked to the network optimization as well. That was done. However, there are some actions that still will have impact on '25. So you will get like originally stated the full impact would come in the second half of '25.

We have a couple of questions also via the chat and I shall be translating this so let's see how we go. Have you set any kind of deadline for taking in the unprofitable business in Sweden and Germany? Shall we see a downgrade or sales of Sweden or Germany to somebody else?

I think Germany, we are on a steady path and I feel good that we can deliver the path. Sweden, we feel confident that it is doable. Then time will tell how fast. And then I think if we're not able to make it profitable, then for sure we need to consider something else and that's maybe one of the tools in the toolbox.

Okay. Another question, it's a fairly long one so I'll shorten a bit. Looking by the figures, it looks like that the Secto purchase and Webcars has not given the input into purchasing activities as you might have expected. So how would you comment on this?

I think on the Secto, the benefits are to be seen and we are very happy with the cooperation we do with Secto. Initially when we acquired the large stock of the transition, some of the vehicles were in a position where we had difficulties of getting the full margin on that one. Now we know that we've been doing exactly what we've been planning and actually at par with that, initially not. Then with the Webcars, it's very early days of the journey. We're very happy with the capability, skill set and the way of working. Going forward, they're going to be clearly an integral part of our sourcing both for Finland, Sweden and Germany. And especially Sweden, we're going to work very close cooperation.

Good. Thank you. And that was all from the chat side. Any further questions from the audience or shall we call it the day?

Thank you for the questions. Thanks for the attention. Enjoy the rest of the day. Take care.

Thank you.

All the best.