Mips AB (publ) (MIPS) Earnings Call Transcript & Summary

Hello, everyone. My name is Max Strandwitz and I am the CEO of MIPS. Welcome to the Capital Markets Day of 2022. And before we go into the presentation, first, a note from our legal team, so our disclaimer. And anyone that wants to read through the whole or no need to know more about the content. We also have that in our presentation. And before we actually start the presentation, just a short inspiration movie from one of our athletes, Kate Courtney. [Presentation]

So Kate Courtney, a great inspiration to all of us. And before going into the agenda and the presentation, I first want to introduce the team of MIPS that we have with us today that also will present. So first of all, our CFO, Karin Rosenthal, we also have our CMO, Fredrik Jellberg, with us today and our Head of Sales, Johan Sauer. And with us today, we also have the Chairman of MIPS, Magnus Welander who will also be available for questions and answer session after the presentations and so on. So really -- sorry, really before we go into the presentation, a short agenda point. So first of all, we will talk a bit on our performance so far against the previous target. And actually what has changed on the market. Karin will talk about our sustainability commitment. Fredrik will talk about all the great work we have done with the brand and also our product. Johan will talk about our sales priorities. Karin will then explain what does this actually mean in terms of numbers? I will do a wrap-up and then we will also have time for a Q&A. And of course, to understand the future, you also need to understand your history. So first of all, a recap of our old financial targets. We did announce them in September in 2019. And the first one was to reach a net sales of SEK 1 billion. At that point, it meant that we would need to grow with an average of a little bit more than 20%. We also had a very ambitious EBIT margin target that most company would be very impressed of that would be to achieve an EBIT margin above 40%. And despite being a growth company, we still wanted to distribute dividend. We had an ambition of distributing dividend of more than 50% per year of the net earnings. So how have we then been doing against those targets? So first of all, the performance has been a lot stronger than we planned. If we look at the net sales development in the last 3-year period, we actually managed to deliver a CAGR of 47%. If we look at our EBIT margin and our EBIT margin development, we did manage in 2019 to deliver an EBIT margin of 41%. In 2020, we managed to deliver an EBIT margin of 46%. And for last year, we did almost achieve an EBIT margin of 54%. So we did tick also that box. And then when we look at the dividend distribution, we have slowly been growing into our own dividend model of distributing 50%, by distributing 92% for the financial year of 2019. 71% for the financial year of 2020 and 51% for the financial year of 2021. So of course, really strong numbers, and we managed to tick all those boxes, and that's one of the reasons why we are here today. But for me, of course, that's only numbers. For me, it's much more important what you actually managed to achieve. And we did a couple of things that I'm very proud of during the last 3 years. So first of all, we managed to establish ourselves in a new category that basically didn't exist three years ago, our safety category. . And there, we already have some great partners that we can start to build the momentum with. We have had quite a slow-moving animal that we call Moto there, we're now actually starting to win. For us, it has also been very important to win in the U.S. market. That's by far, our biggest market. And there, you can really see that the consumers, they go into a store. They ask for MIPS and then they pick the brand and the model and sometimes something that even match the color of their jacket. And there, we have gone really far when it comes to becoming the expected safety solution in Helmet. We, of course, like that success story. So we want to replicate the same thing in Europe. There is no reason why they should be different in penetration. And that's also started working, and I will come back to that also a bit later in the presentation. And for us, we always consider ourselves to be very brave. And for us, it's also important to believe in our business model and despite going through a pandemic situation, we have actually managed to double the amount of resources that work that MIPS. For the average of 2019, we were 43 people. And if you look at MIPS today, we have 90 people working at MIPS and of course, all of this during a pandemic situation. But again, we are here to talk about the future. And why did we actually call for this Capital Markets Day? What's the key reason? First of all, we are ahead of our plan. We have outgrown our plan. And if you look at the performance that we need to do the coming years to achieve the old plan, it would have been around 10% on average per year. Which both we and most investors have a significantly higher ambition than that. Of course, we have also done a lot of innovation. We know more about the market than we know 3 years ago, so the market opportunity has also increased. And then we've also seen that the market has grown. When we presented our last market snapshot, we didn't include any growth because for us, this is very much a penetration story. If the market grows, it's great, but that's not really what matters. What matters is how fast can you actually penetrate your customers' assortment and that is really what the story is about. And of course, all of these in isolation would probably be enough to update your financial targets, but of course, we have all of the 3 of them working in our favor and valid reasons to change our plan going forward. So of course, if you look at the new long-term targets that we announced yesterday night, and they are to, first of all, achieve a net sales of SEK 2 billion by 2027, which means that we need to grow with an average of 22% per year. We have increased our ambition on the EBIT margin target, and we now have an EBIT margin target of more than 50% per year. And we kept our distribution ratio of having a payout of 50% per year. So really ambitious, but realistic targets in the coming part of the presentation would really be about what underpins those targets. So first of all, when we look at our world, we always start with a big picture. There is a couple of very strong macro trends that supports our growth story. So first of all, there is a lot of ESG focus on the world. There is not one big construction company that doesn't have safety top of mind. And of course, that is something that we can capitalize on. We also see that the helmet use is increasing all over the world. First of all, by law, and it also starts to become mandatory for some of the vehicles that people are transporting themselves in -- but we also see that people start caring much more about their own well-being and personal protection, and that's also one of the factors of increasing the helmet use around the world. We have also seen a very strong outdoor trend. A lot of people think that given that the American interest rate is more than 3% at the moment, that no one will use a bike anymore. We don't see that. We see a very strong trend. There is a lot of confusion today about inventory levels versus the long-term consumer demand in bike. We still see a very strong demand in bike is driven by a couple of different reasons. The first one being the e-bike trend. There is a very strong e-bike trend in the world. There is a consultancy report indicating that somewhere between 2025 and 2030, there will actually be more e-bikes sold than traditional bikes. And of course, you travel at a different velocity. You normally spend more money on your bike and then having a helmet on becomes very, very natural. If we then look a little bit on the smaller picture, so we talk about our markets and what do we actually expect. So first of all, we expect all our markets to price up. We see that the consumers are prepared to pay more for the gear, and they also prepared to pay more for added safety. If we look at bike, we see a very strong bike trend and that it will continue. A lot of people happen to talk about what happens in 2022. For us, and when we talk to all the major bicycle brands and also the gear brands around the world, everyone has a very strong expectations on bike going forward that there will be a strong consumer demand for many years to come, and we see the same. Snow, even though Snow is growing fantastic for us at the moment, we have a little bit more gloomy picture. We believe that, over time, winter sport will be more for the selective few. It will become a lot more expensive. There will be less Snow around the world. And we don't believe that, that market will continue to grow like it has done before. A lot of people talk about the China ski resorts industry that, that will open up. They have been doing that for 10 years. We try to be realistic. So for us, Snow, we will continue the penetration, but we don't expect the market to grow. If we then look at the equestrian, there has been a lot of new riders recruited. They are prepared to spend quite a lot of equipment and on horses. We also see that the Moto category will continue to grow, not so much the U.S. market, not so much the European market, but more if you look at the developing markets. There, we see a very steep increase in terms of sales. We see a very strong market growth because there is a lot of new helmet regulations and also starts to become mandatory to wear helmets and helmets are improving. We see the same in China, 20th of June 2020 is became mandatory to wear helmet when driving a scooter in China. And we see the same thing happening in India also. And these are 2 really, really big markets. If we then look at our own categories and what do we actually expect from them. So first of all, we continue to see very strong consumer demand in all our 3 different categories. And despite going through a pandemic situation, we haven't stopped one single day. Our office has been opened all the time. We have actually not decelerated our investment. We actually accelerated our investment because we had the opportunity, and we had an opportunity to grow faster and do a lot more than we planned. We do expect that the world will remain unpredictable. We know that there is a lot of things that happens around us that we don't have control over. But for us, what we can do is really focused on what we do. And that is, of course, to implement as many projects as possible, grow with our customers as fast as possible. Whatever happens in the world, we don't have any control of. Then during this time, we have, of course, invested quite a lot of time in our capabilities, and this might look like a little bit geeky and it probably is. But for us, it's really a big step forward. It's about our virtual test lab. And some people that follow us might have seen this in -- at LinkedIn or at other forums and so on. But what it's really about is, about computer simulation. It's about FE modeling. And this is how to predict how helmets will test even before they exist. Inspiration comes from the car industry. No one would build a car today without knowing that they are developing a safe car. That's where we got the inspiration from. MIPS has been doing this for internal use for [ reachers ] purpose for quite a lot of years because for us, we couldn't actually afford to do it because we didn't have the money. Now we bring this to our customers. We will bring that into their customer or helmet development projects. And what we can do is 2 things that we haven't seen anyone else doing. First of all, we can test helmets for rotational motion. So the more complex things in the helmet, and we can also predict where cracks will occur in helmet. Traditionally, when someone did the helmet, what happened was that they developed the helmet and they go for certification. If the helmet didn't pass, that certification, then they need to go back to the drawing board. We want them to skip that step. Speed up the process because in the end, if our customers sell, we sell because we are an ingredient brand. One thing that is very important for us, and Fredrik will come back to that. We know that if the consumers are aware about what we do, they also buy MIPS. They are prepared to spend a little bit more. That's why you always hear us being very obsessed when it comes to the MIPS brand. We want to drive the awareness around the world because we know if we have the consumer with us, we will win. In the North American market now, we are at the awareness level of 45%. So it has really increased during the last years. You know that I talked about that we want to replicate the same success in Europe, and it starts to happen. Also here, we see a big change. And just to give you a reference base, when we had our Capital Markets Day the last time. Our awareness in Europe was around 10%. If you would go to south of Europe, you will probably be at single digit, low single-digit awareness. And now also the European consumers is waking up. And then if we look at the total market, and this is, of course, what a lot of you are probably very excited about you saw the press release yesterday. We talked that the total helmet market has grown. And yes, it has grown. It has grown significantly by SEK 140 million to SEK 550 million. And it doesn't mean that the market growth -- our market growth has been 20% or 30%. There is 2 things that has happened -- we know more helmets than we knew before. There is never like official data. You always need to create your own helmet universe. But we have also included much more helmets into our helmet universe that we didn't include before. The biggest change is, of course, scooter helmets in motorcycle. So when we look at our total helmet market, it has increased significantly. It's always good to have a big market, but if you can't address it, it makes no difference. So what has then happened to the addressable market and addressable market where our naming and definition to that is helmet that MIPS can address with the technology either from a technology point of view or from a price point of view. First of all, the very interesting Safety market. There, we see an addressable market that has increased with 40 million helmets per year. It doesn't mean that the market for that type of helmet has increased with that amount. But before and also when we announced this number last time, we can only address what we called Type II helmets, so they're a little bit more advanced helmets that costed a little bit more, and that's why you saw a smaller scale or a smaller addressable market. Now we have actually launched and can address also Type I helmet. And then, of course, it also becomes logical to include some of them in our addressable market. Moto, we talked about the scooter market fantastic, even though it's a big market to go for, the consumer awareness there is very low. We know that if the consumers are aware about MIPS they will pay for MIPS. But we also know if they are not aware about MIPS, they don't -- will not pay for MIPS. And then, of course, we need to be a little bit more realistic in our assumption. And that's why we included another 10 million of scooter helmets in our addressable market. And then in Sports, we see an increase of 15 million. There is some swings between the different helmet types, but the main driver is that we have seen that the market opportunity, especially in bike has increased, and Johan will come back to that a bit later in his presentation. So of course, quite a lot of big untapped potential. If you look at the numbers in 2021 despite being the world leader in what we do. If you add the total amount of previous competition that we had. They are not even at 10% of what we do. We still only have 2% of the market. So 98% of the total market to go for. If we then look at maybe a little bit more realistic number, then, of course, we still can go for another 94% because if you would translate these new numbers into the new total, it means that we have 6% of our addressable market. When it comes to our vision this is actually the best vision I ever had for a company that I ever worked in. And that is, of course, to reduce head injuries and save more lives. Most often when people start working at MIPS, they start working at MIPS because it's a cool company. We are in the outdoor industry. People like what we do, ingredient brand, a bit exciting, but that quickly transformed into something else to actually be able to make a difference for people that quickly becomes quite addictive. When we look at our mission, then of course, with the wealth of knowledge that we have, we believe that it's our responsibility to really start leading the world to save for helmets. We have tested more helmets than anyone else in the world. We sit in all the regulatory bodies around the world. And of course, we want to make sure that all the helmets in the world that are certified are testing in the best possible way. So that, of course, is our mission. When we look at our position, again, with all the knowledge we have is really to become the leader in helmet safety. It doesn't mean that we will start producing our own helmet, but we will take more responsibility of the helmet. We have a wealth of knowledge. We have done so much test, like I said, we know more about helmet testing than anyone else. And now we will start opening up that also to our customers. They will get access to our virtual testing. They we will advise them on how to design helmet. And of course, that creates a very unique opportunity for us and a great opportunity to really become the leader in helmet safety. If we look at our strategy in 3 key pillars because, of course, we talk a lot about growth, but what will it really come from. For us, organic growth with existing business is key. That's the biggest building block of our plan. We have the customers on board already. If you look at the bicycle category or industry, we have 9 out of the 10 biggest brands in the world. Snow, we have all the 6 biggest brands. In Moto, we really start to get momentum in the safety category, also a lot of brands. So there, and this is by far the biggest part of the plan. Like I said, it's about growing with existing customers. Then we talk about the other parts and the other pillar of our strategy. It's to open up new channels and new markets. I say open up because it's not that we didn't have the request. But we were still building a brand. We were still focusing on a lot of other things, and focus is very important in MIPS. Now we believe it's the right time to also start focusing a little bit more on the lower price points, but also on other geographies. And Johan will explain also a bit more on that. Then we have the third one and probably the one that most people were most interested in, what does that actually mean to capture new opportunities within helmet safety. There, we also have 3 pillars. The first one is really about bringing our helmet development capabilities to our customers, open up virtual testing. The second part is to go into much more aftermarket products. If you look at the whole safety industry and especially the U.S. market, normally, the big construction companies refurbish their helmets every year. That means that if you have an installed base, you can sell up to 3, 4 times to the same helmet. And of course, we want to have that opportunity. So when they change the inner content of the helmet they will actually have an opportunity to buy MIPS again, which is, of course, a great opportunity. A lot of our helmet partners are also doing performance helmet when it comes to cycling and so on. They sweat and the padding becomes a little bit teared or weared. And of course, at one point, they want to change it. Now we also have technologies, which means that you can exchange the padding in your helmet and you get the opportunities to sell the padding to that helmet once again. Really hope that the helmet is still okay, but the MIPS functionality is there and we get an opportunity to get license fee in other time. And then the last one is really about doing some new technology, doing other things in the helmets that we are not doing now. We did announce a very small acquisition in January. We will now start capitalizing on that, but also do other things in helmet when it comes to comfort, ventilation and design. And what does that actually mean? Because it doesn't sound maybe like a big step. But for MIPS it is, and we call it a paradigm shift. It's really about focus for MIPS will not only be at of rotational protection, we will actually focus on the total performance of the helmet. And of course, optimizing everything that has to do with the helmet when it comes to ventilation, when it comes to comfort, when it comes to design and fit and, of course, bringing that capability to all our brand partners. Then I will hand over to Karin, who will talk about our sustainability journey.

Thank you, Max. So hi, everyone. I'm Karin Rosenthal. I'm the CFO of MIPS and also responsible for the sustainability program at MIPS. So I feel really proud to be here today to talk about our sustainability commitment and our journey to a more sustainable MIPS. So at MIPS, safety always comes first and second is sustainability. That means that sometimes the sustainable option might not be as cost efficient, but still the right thing to do. We have divided our work in MIPS into 3 different pillars. The first one, our employees, the second one, our product, and the third one, our supply chain. And the environment runs through all of these 3 pillars. So first, if we look at our employees. We want to foster a strong culture where we have people who are curious, humble and want to innovate and make the best and safest products. We also want a workplace that is free from discrimination and where we have gender equality and diversity top of mind. We also want the sustainability to be integrated into our business agenda and included in every decision. A lot of people at MIPS go to work every day with a mission to reduce head injuries and save more lives. Looking at our product if we look at helmet safety, we believe that our technology can help and might reduce the risk of injuries and sick leave. We also believe and want the customer to file as few complaints for us as possible because they -- we want them to see us as the safer option. And also, of course, we want our products to be more sustainable. So we have already started offering more sustainable products to our brands. And the third pillar, our supply chain. We currently use over 80 different subcontractors. We don't have any own manufacturing or production. And all of these, we audit at least by yearly. We also have a strong quality assurance program because we have a safety product. And all of these also need to sign our code of conduct. And then if we look at our environmental impact. So we are a fast-growing company. So that means if we don't -- no action at all, we will actually increase our emissions around 4x. So what we have done is that we have signed up for the science-based target initiative. That means that we will be audited that we will actually decrease our emissions, and that is the same as the Paris agenda that has the ambition of a global warming of not exceeding 1.5 degrees. So then looking at our total carbon footprint. We did the mapping in 2021, where you can see that our total emissions for both Scope 1, 2 and 3 was 9,400 tons. And the manufacturing was the main part of that, and only about 5% or 500 tons was related to our own operations. So we are an ingredient brand, so what we need to do is impact more in the supply chain and support them because 95% of our emissions comes from producing our products. And if we then divide this 95%, we can see that it comes from 2 different things. So first, the material when producing our products. So here, we have started to change to a more environmental-friendly products and then the energy source. So that means while producing our helmets you have the electricity in the supply chain, so we need them to change to a more renewable energy source. So if we look at our commitments, the first commitment, we have signed up for the science-based target. So we will be audited that we are decreasing our environmental impact. Second, we have signed up and will incorporate UN Global Compact. Meaning we will consider and take responsibility for labor, human rights, anticorruption and also environmental friendly alternatives. So this will be incorporated in the business and also added to the code of conduct both for suppliers and for our employees. And the third commitments is about the circular product offering. So as I said, we have started with a new product that is made from pre-industrial or waste material that has less impact on the environment. We also have only recycled packaging material and all of our products are recyclable up to 90%. So to summarize, we want to lead the world to safer and more sustainable helmets. So then it's time for Fredrik to talk a bit about our brand.

Thank you, Karin. So a lot of really nice and great initiatives and actions going on in the sustainability field. Sustainable products also needs to be backed by a sustainable brand. And for that reason, we have invested quite heavily over the past 2 years in the brand. We have built a marketing department from 1 person to 11, soon 12 people. We have invested a lot in our brand platform, new communication platform, a new visual look, new product identity, and all of these are together building the brand in a very strong way. And to become the leader in helmet safety, we, of course, need to make the consumer associate us with safety and helmets. We need -- when people see our logo, it needs to be loaded with the message of safety for helmets. When you pick up a helmet that you want to pick for yourself or for your loved one, you should really feel that this product meets the requirements that I need. That's what we need to get known for. And we can also see in our research that consumers, just like Max said before, when they understand this, they are actually very willing to both choose and pay for MIPS. Being a science-based company, we, of course, incorporate a lot of science also in our marketing. So when doing the research, we can see that we have a volume premium of 36%. And that's a really good number, but without any direct competitors to compare with, it's a bit out of context. But if you look at other industries, successful brands typically are at this level. So it's not a unique number, but what is unique, however, is our price premium. The volume premium indicates the willingness to choose a product. The price premium indicates the willingness to pay for the very same product. It's quite usual that you have a high volume premium. Yes, I want that brand. But then when it comes to paying for it, the wheel is not really there in the same way. As you see here, we are at a very, very even level between these 2 and what this indicates is that consumers who know about MIPS, they also want to choose it, and they want to pay for it. So the funnel, from awareness to consideration to actually become a customer or consumer is very watertight. And that's why we say that if you know MIPS, you buy MIPS. So this means that awareness is key for us. It's our most important KPI. And to set ourselves up for success, we have for that reason, organized our marketing department and our marketing spend in 4 main areas. First one being PR, and that's also what has been longest running for us. We have a very, very good track record in PR. We have been increasing our reach and our mentions year-over-year, and we continue to invest to go into new markets and maybe most important, will also go wider than we have done before. We have been very strong in endemic media in specialist magazines and websites, but we are now going broader, focusing on broader media to reach even more people. And it's really nice to do PR work when you get classic publications like Forbes, writing a statement like the MIPS label usually adds twenty to forty bucks to the price. But simply do not buy a helmet that does not have it. There's no sense in that. And every major manufacturer offers MIPS. So PR, really strong, really important area for us, but you unfortunately don't reach everyone through PR. So for that reason, our second area is Paid media. In year-end this year, we, for the first time, actually went into a really, really big media campaign, targeting our focus markets, Germany and U.S., making sure we continue to build the awareness also with the people who we don't reach through our extensive PR work. The third area is a bit closer to purchase, and it's about our new In-store concept and our new educational platform. We are typically, if you go into a bike store, for example, or another of our main areas like Snow or Motocross, we will typically be somewhere between 60% and 100% of the assortment, but that has not really been clearly visible. So to make sure to highlight that, we have built this In-store concept ranging from small signage to, as you see here, full shop-in-shop solutions. And that is to really claim that space and get our fair share of attention on the helmet [ wall ]. And this also gives the staff in the stores, a good talking point when selling a helmet to talk about this added safety feature. And to make sure that all staff people are properly educated, we have developed an app and Academy platform, where we educate people on how to talk about the product, how to pick up a helmet, talk about the benefits of MIPS and what difference it does for the wearer. We are sold through probably somewhere around 40,000 doors. So you can imagine there's a ton of people out there who we need to educate. And then a digital tool such as this becomes absolutely necessary. Fourth base is also very close to purchase because it's E-tail. Same thing as in physical retail, we have usually a very big part of the assortment, and we need to make that seen. And we need to communicate in a coherent way across all different E-tail platforms and also the brands on e-commerce. So we have developed assets, and we are investing into getting this out into the E-tailers to make sure we are seeing in the way we want and that the product is properly explained to the consumer. Tying all these communication together, we have our team MIPS. There are, of course, very many people using MIPS helmets out on the big pro circuits and different sports every day. But we have selected a few that we see as great ambassadors for our brand. We want to be the leaders in helmet safety. So of course, we need the leading personalities out there. These athletes are, as you see, engaging in quite dangerous activities. They are prepared to take that risk. But of course, they also want to minimize that risk as much as they can. And they are a fantastic spokesperson for our brand. And of course, as you see, they give us pretty nice content as well. So on this team, we have -- you see here, Mr. Brandon Semenuk, by far, the most decorated big mountain bike rider in the world. We have Kate Courtney who you saw earlier, World Champion and World Cup winner, we also have Tim Gajser on Motocross, who has already 4 world championship titles going for a 5th this season. And we have Henrik Harlaut, the Swedish freestyle skier, who is the most decorated freestyle skier in the world actually and Marion Haerty 4-time winner of the Freeride World Tour. So a fantastic bunch of athletes, all with their own safety story. And some of these guys, they grow up watching their idols actually perform these activities even without the helmet. They want to be better role models than they self had. So they want to promote helmet wearing in general and MIPS in particular. Last thing I wanted to talk to you about here today is our products. We, of course, are a safety product. We have last year alone, we sold more than 12.5 million helmets. So the product itself is a big contact area to the consumer. So in every helmet, we, of course, need to look as best as we can because that gives confidence in safety product. We also have a huge challenge of having more than 140 brands that we need to either fit into or stand out. It depends a bit on the price hierarchy. So we need to provide a toolbox where the brands can really work with our concept to make sure that they get the right look of our product in their helmet. And we have many different solutions and some of our more exclusive ones, they are really stealthy and tucked away in the helmet. That means that the better job we do, the less visible we actually are. And then we need to make sure that the small visible technologies we have really becomes highlighted and pops out and adds value to that product. So with great product design, we, of course, need also a matching level of our marketing assets. So this is the kind of level where we want to show ourselves in the future. This is how nicely we need to portray our product to make sure that the consumer understands what they are paying for and the benefits that it brings with it. So all in all, nicely designed, sustainable products, neatly packaged, heavily marketed everything set up to back up the very ambitious sales plan we have. And here to talk more about the sales plan, I give you our Head of Sales, Johan.

Thank you, Fredrik. Very exciting to go to market with products, platform and marketing assets that look like this. I'm Johan Sauer. I'm Head of Sales here at MIPS. And I'm going to walk you through our sales priorities in a little bit more detail. Let's start with the market opportunity. And as Max already shared, the market has increased quite a bit. We now see a total market of 550 million helmets annually. And in turn, also our addressable market has increased to SEK 195 million annually from SEK 130 million previously. In sports, SEK 45 million, the biggest change is bike where we both have seen a strong underlying growth, but in addition, adding additional price points as well. On the Moto side, we see a market of SEK 40 million, up from SEK 30 million. The biggest chunk of that is in the On-road subcategory. And if you have been paying attention in the past, you recognize that we have changed the terminology of the Moto market a little bit. We used to talk about Motocross or MX and Street. And the reality is that the type of helmets and how they're used is much broader than that. And now that we're also including scooter helmets in our Moto category, a much more relevant way of talking and explaining our 2 subcategories is On-Road and Off-Road. And this is what we'll be using going forward. On the safety side, that's the biggest increase, up to 110 million units. The biggest change is on the construction or industry where we see a market of 100 million units, the big change there is that we're no longer just addressing the Type II helmets but also a share of the much larger type I helmet market. And for those of you who have been following us, obviously, our business is doing very, very well. Despite the market growing at a very high rate across the helmet categories over the past years, we have managed to outperform the market. Both by adding more and more models in more brands product ranges and also in white -- previous white spots like the European markets, where we see an increase in momentum and more and more brands coming on board, adding more models. Secondly, we see an increase in brand awareness across our categories and across our markets. And like Fredrik already explained, an increase in MIPS brand awareness is directly sales driving. Thirdly, independent testing and helmet certification across our categories, we see a continuous movement towards inclusion of rotational motion in standards and independent testing, obviously, also a factor helping us grow. Over the years, we've also built a quite amazing customer base. Over 130 brands in sports, 30 Moto brands and now 10 brands in safety. And together, these provide us a very solid platform for continuously growing our existing business. And that is the top priority of our first strategic pillar. So let's see how this looks in our different categories. In sports, it's about winning with the existing partners, and it comes down to 2 things: one, continue winning in the U.S. It's still our biggest market and our strongest presence. And there, it is about reaching specific price points and specific retail channels to close the gap. In Europe, it's about replicating the success that we are having in the U.S. and the momentum has picked up quite a bit. We're adding more brands. And now it's about to make sure that we stay on the same trajectory that we've had in the U.S. One very, very clear opportunity in sports is to focus more on our kids. In the past, kids helmets have been a little bit out of our addressable market. But we're a little bit of shame of that because kids are the most important asset that we have. And we are now in a position to address more of those helmets, and we will actively make sure to close the gap and provide added protection to more children. Let's look at our second category, Moto, and in any category that we enter, we strive to become leaders in helmet safety. And on the Moto side, we are well on our way. Especially if you look at the Off-Road category, there, we have a strong presence in brands, a lot of models in the market. And if you look at the professional racing circuit in Motocross, the majority of the top riders are wearing MIPS equipped helmets from one of our brand partners. They're basically winning every race in Supercross and Pro Motocross and of course, this helps to create additional momentum, more Motocross brands coming on board and adding more models. So for us in Moto, 2 of the priorities are same as in sports. It's about keeping winning in the U.S. and replicating that success in Europe. The third priority is about convincing the On-Road brands. They've been a little bit slower to the game, but we are seeing an increased momentum and a pickup in interest. And for us, it starts with racing. The rotational parameters are being added and are included in the ECE 22.06 helmet certification. We are seeing a spillover from other helmet categories now, especially in Motocross. So more Moto brands on the On-Road side are showing a strong interest in MIPS. And for us, it starts with racing. Racing is the place where you build credibility in the On-Road category, and our strong objective is to create a relevant presence for MIPS there. Thirdly, our Safety category. That's our latest addition. And when we presented at the Capital Markets Day in September 2019, we had one brand on board. Today, we have established a fantastic base of 10 announced brands with the latest addition being the top international brand, Uvex Safety. But more than that, we're also seeing a strong progress and momentum on the construction company side, where now 2 -- sorry, 3 out of 5 Nordic construction companies are offering safety helmets, with MIPS integrated to their workers. So with that base, it's now about generating volumes. And as I said, we have the brands and we have the foundation to build that growth and to make sure that we create the biggest possible impact on each of our markets, we're making sure that we are working with the key partners, distributors, education providers to ensure that MIPS gets the best possible impact and to make sure that we can manage and create the growth that we want in the category. We're also building the right organization. We are building a team of educators and product specialists locally in our focus markets in Scandinavia and in the U.K., we have that already in place. And for the U.S. market and the German market, we have resources starting July 1. And we believe with this setup, we have what it needs to start ramping up the volumes. But of course, we also need to do things that support our sales. And despite that we are slightly in different phases in our different categories, for us, it comes down to 3 things. Firstly, supporting sell-through. We're an ingredient brand, and it's quite easy. If our partners sell, we sell. This is about helping our partners succeed. And we do that through key retailers and E-tailers, education campaigns and sales campaigns to help our partners succeed. Secondly, it's about educating the crowd. Fredrik already shared the famous words. If you know MIPS, you buy MIPs, and that what it comes down to. We are working with our partners, retailers, E-tailers with the help of our amazing assets, MIPS Academy, continued PR efforts to educate the crowd on MIPS. And thirdly, making sure that we keep growing our penetration. This is about constantly making sure that we improve our value proposition so that we can keep growing in our partners' product [ ventures ] . And this is how we will grow our existing business. The second pillar is about opening up new markets and new channels. It's about 3 things basically. New channels, it's about reaching down in price points in specific retail channels to access additional volumes. Secondly, it's about new markets, opening up emerging markets that are now showing a real interest in MIPS. And thirdly, new helmet opportunities, basically offering MIPS to completely new helmet categories. And the first opportunity is about opening up new channels, reaching down to the volume price points that we previously have considered to been too low. And this goes back to the founding idea of MIPS. It's about offering improved and better protection to as many people as possible. It should not be about the size of your wallet that decides if you can improve afford that protection or not. We've been asked over the years quite often, in fact, to enter these price points and enter these channels, we have said, for the most part, no. We felt that our product, our brand and our position in the market has not been ready for it. But things have changed. The interest both from the brands from the retailers and the MIPS position in the market in general is completely different today. And our ambition is to actively enter volume price point and related channels in order to win. Second opportunity is about new markets. And looking at emerging markets, it offers quite a bit of potential in volume. Moto market, for example, more than 60% of the global market is in India, China and Southeast Asia. And of course, we won't be able to address all of these. And historically, emerging markets have been completely out of our focus because of low helmet use, extremely low price points, low general awareness around safety, but this is changing. People are now willing to spend more on helmets. New helmet laws and regulations are coming into place and there is a quite big increase in interest for MIPS. So with this in mind, we will enter some of these markets and offer our technology to improve protection where we can. And the third pillar is about, like Max said, capturing new opportunities in helmet safety and it's about taking a complete helmet performance focus, looking at the whole helmet. The first thing that we will capitalize on is competence. Over the years where we have worked very hard to become leaders in rotational protection, we've also built up a quite unique know-how, understanding and capabilities related to much more than rotational. This is about offering this unique competence and capabilities to our customers and the helmet industry. Secondly, aftermarket and add-ons, with MIPS becoming a more integrated solution taking more parts of the helmet into consideration. Obviously, this opens up opportunities to provide padding, but also in safety aftermarket products. and basically prolonging the lifetime of our products and the perceived value. And the last one and thirdly is new innovation. This is about looking outside rotation. People, when they think about safety in helmets, its impacts. But fit, comfort, ventilation, aerodynamics or all factors that make a customer decide if they want or do not want to buy helmet. So if we can even make a customer buy a helmet, doesn't matter how safe it is. So looking at the whole helmet, it's about doing things that we don't do today. As you see very interesting opportunities for our future growth, and we have a unique position to capitalize on those. Thank you very much. I'll hand over to Karin, who will explain how that looks in the numbers.

Yes. Thank you, Johan. So then if we go into the financials and also tell you a bit more about the numbers. So first, as Max said, our previous target was to reach SEK 1 billion in net sales by 2025 and have an EBIT margin over 40% and payout dividend of more than 50%. Our new financial targets which we communicated last night, is to reach SEK 2 billion in net sales by 2027 to have an EBIT margin of over 50% and to continue payout dividend of more than 50%. If we then look at net sales, so if we compare to last year 2021, we need to grow on average by 22% to reach the SEK 2 [ million ] target. And if we look into what that actually means, we are saying that around 2/3 of this will come from grow existing business. And the last 1/3, half of that will come from open up new channels and markets and the other half will come from capture new opportunities within helmet safety. If we then look at our EBIT margin, so we operate as an ingredient brand. We have a highly scalable business model and we will continue our strong growth and have a gross margin of over 70%. We want to fuel our brand awareness and continue to build our brand platform. So we will increase our marketing spend to 7% of net sales. The last plan was to have in between 5% to 7%. If we then look at R&D, we are born from science, so of course, we need to continue our Research and Development and the product is the key. So we will continue to invest heavily in this with ambition of 5% of net sales. We also have a really scalable business model for the rest of the OpEx, so this will enable an EBIT margin of over 50%. Then if we look at our cash generation, we have really strong cash generation capabilities. So we have an asset-light business model. We only have outsourced production and we also only hold limited finished goods inventory. We invoice at delivery of our products and we will continue to invest in our intellectual property and our own testing facilities, but we don't need to invest in our manufacturing. So this will enable a dividend payout of 50% of net earnings. And if we look at the granularity of the reporting going forward, so we will continue on a quarterly basis, report net sales per category, both in Safety, Moto and Sports and we will continue on a quarterly basis, report net sales per region. But since we are changing or increasing our whole value proposition per sold helmets, we have soon 1,000 different helmet models on the market. We will no longer report year volume and no longer report number of brands or models. And this reporting will be applied now from Q2 2022. Thank you, Max. Now it's time for you for wrap up.

Okay. So thank you, Karin. If we then summarize what you have seen today, our strategy is really about 3 key pillars. One is to grow existing business. We are good at delivering organic growth. Our plan going forward is also about organic growth. It's also about opening up new markets and channels, really capture the opportunities on those markets and the last one to capture new opportunities within helmet safety. So first of all, we have the vision. We have the best vision I ever had in the company that I ever worked on to reduce head injuries and save lives that really becomes addictive. We have the opportunity. We have, the market wants our product. The consumer wants our products and we have the products to win in the market. We also have the capabilities. Our investment in the last years has really been about creating a winning strategies for the years to come. We have invested heavily in marketing. We have never looked as good as we do today. We have developed a lot of new products to also win in the market. The whole aftermarket concept is completely new, and that's something that we created in the last 2 years. And we also have the resources to do it. We've doubled our competence in the last years. So for us, it's about get going and really become the true leaders in helmet safety. We now open up for questions.

So Karl, Berenberg.

Yes, Karl Oskar from Berenberg here. Just first question on the lower price segment. Should we then assume that it's actually a lower revenue for you as well within that segment. So you're actually lowering prices if you think of that.

Yeah, if you look at the average ASP, that will go down for that specific market. We have, of course, done innovation. So for us, we have the products that can play in these different price points. So margin-wise, and then I'm talking about gross margins, you will not see a difference. But in terms of ASP, yes.

Okay. And just a follow-up on that, I assume it's the same customer in some of these models. Is there a -- do you see a risk that you will have to lower prices further within the higher end.

Yes.

So it's across the -- across the old...

No. So it will not cannibalize on the rest of our assortment. And those customers we are talking about on those markets is not the same as we have today in the other markets. So it will not cannibalize on each other.

Okay. And then within the scooter segment, this is obviously quite an interesting angle. Is this -- what kind of brands -- is this the same brands that you're currently working with? And how did this kind of come about? Was it coming from the customer that they wanted to implement this.

There is, of course, the big change that happened on the market was really the regulatory change that we saw in China where they started to request a lot of new helmets on or mandatory helmet rules in China. We have seen that the market demand increased quite a lot. The bigger helmet manufacturers within that category is the e-scooter brands. So you have the Xiaomi, you have the Neo and all of that. So that's where you find the big partners in that area. Then you have also a couple of very big players in India and so on. But they are not the same brands as we have in other markets.

Right. And then maybe also, could you give us some more color on safety? Perhaps, I mean, something related to the models you're launching with Uvex this year. It's quite interesting when you expect to see some real volumes sort of moving the needle for the group and perhaps just broader with regards to safety, how you actually work with educating the industry in a bit more detail?

Yes, so I mean, if we take the first one, we did announce our partnership with Uvex in end of April, we said that there will be 2 launches throughout the year. The first one is a forestry type of helmet, smaller volume. And then in August, we also talked that they will launch their Pronamic helmets, which is their flagship helmet. With that flagship helmet, you will also see that the volumes will start to increase. And then when it comes to education, of course, the safety category is a very specific [ animal ]. What we do there is normally, we team up with the helmet brands, and we talk to the industry to explain how it works. We have a lot of roundtable events where we invite the bigger construction companies in the industry and the bigger safety players in the industry and have an elevated discussion about safety. What does injury statistics look like? What is the different relevant in your current areas that you need to address? We also show them a lot of the modeling and the testing that we have done and why MIPS is a relevant option also in that industry because still, we are almost 3 years down the road. Every discussion starts the same. Great that you have MIPS but I don't need it. My workers, the only time they get hurt is when they get the falling object in their head, okay? And I say, how do you actually back that story up because if you look at the relevant in your statistics, it doesn't show that. And then they said that, no, it's true. Okay. So let's look at your data. First of all, they don't have a lot of data. Even the bigger construction companies today, they don't have a lot of data. They know that an accident happened. They normally know the result of the accident, whether it was an MTC, RTC. So a medical treatment case, a restricted work case and if the worker couldn't come back to work. But they normally don't know what actually was the injury scenario that the worker went through. So already there, we need to start the discussion. And if you look at injury statistics and you can take the U.S. market, the falling object is about 16% of the accident. So you get something into your head. If you get it directly on the crown, then there might not be a tangential force. But most often, you get it actually on the side of the helmet and you can have exactly the same impact. Then you look at 60% of the accident. Then you go into the slips, the trips and the falls. And there, you normally have a tangential force if you fall with some kind of angle to the ground or you hit some kind of angled object. So of course, there, it makes a lot more sense. And then you also take the second biggest relevant in your criteria at the site. You have the moving objects. Either you're hit by a forklift or you're hit by a steel bar moving across the site. So when they see -- and I will not explain the last 4%, but when they see that, of course, they realize that we are actually addressing most type of their injuries scenarios that they have in their site. When we also backed up what we do with science, normally, there is very few of them that talk about price points. They, of course, want to partner -- us to partner up with their key helmet partners, and that's what we're doing at the moment.

I continue Daniel Thorsson from ABG. First, a question on the visibility on the sales target here. In the previous Capital Markets Days your targets have been based on current customers and growing with them. Is this the case this time as well? Because when I try to back calculate the penetration in 27, it looks like 25%-ish of the new TAM. So the TAM has increased heavily here, but not the sales target to the same extent.

No. No. So of course, we have 3 different pillars like we talked about. The first one is to grow the existing customer base. Most of those customers we already have on board. So of course, there, you have a little bit more security, then the second part is about opening up new price points and markets. There, we have some of the customers. We still need to win some of the customers. The third pillar, the biggest part from a revenue point of view is, of course, the aftermarket product, so if we win with the customer in safety, we will have a bigger installed base. And then, of course, that starts to work out also. And then when it comes to the completely new things, that's also where the biggest unknown is. So the majority of the plan, which is more than 2/3 is growing with existing customers, best visibility, second best on the new markets and then the third one is on the new opportunities.

And should we see those pillars summing up to the SEK 2 billion or more than SEK 2 billion in sales? Or is this just the first third of that pillar, the existing customers making up the SEK 2 billion and everything on top of that could be everything up to SEK 3 billion or SEK 4 billion.

No. So what we see at the moment, all of them adds to SEK 2 billion.

Excellent. Follow-up on that, regarding the sales CAGR, 22% in the next 4 years, how should we think about the split during the year? Will we start off with a 30% growth and then, say, 15% in the fourth year as all of the other growth companies? Or will it be pretty much evenly split as you grow in the different segments?

Yes, it's actually 6 years. But anyway, if you look at the 6 years, normally, when you have a gross trajectory, you normally start a little bit higher and then you can expect a little bit lower in the end. That's how much about forward-looking statement I will do on that.

Okay. And finally, that's fair enough. Finally, on the product, new products or new technologies, how much do you think you can internally develop versus acquire and the acquisitions? Will they be meaningful in terms of size? Or will it be mostly technologies that you can roll out?

Yes. Yes. For us, we like to develop technology. We have a bigger R&D team. We're also expanding our test lab and so on. We have a lot of capabilities to develop new products. We did an acquisition in the beginning of the year to optimize the structure in helmet. And of course, we would like to do that. So I would say most of the things that we have in our plan is based on our own capabilities. If we will find a fantastic innovation out there that we could buy. Of course, we would do that. We have the opportunity to do that. We have the cash to do it. But at the moment, we are more focusing internally rather than externally because we can do it.

Okay. Great. I actually have a final one for Fredrik on the marketing side here. We have seen more and more brands launching either a new product developed by themselves or taking in another third-party product, trying to address rotational motion. How does it affect your marketing strategy here because then you can't really rely that much on the brand and you have to make more yourself? Or how do you see that playing out?

Could you please repeat?

If you have a brand, take Bontrager for example, they have both MIPS and they have WaveCel. So they will likely not market MIPS equally aggressive as a brand that has 100% WaveCel mix obviously.

I get it -- that's also why, as you see, all of these 4 main pillars that are presented is actually marketing coming from ourselves. We see great potential winning with the brands and building our brand story through them, but we can't 100% rely on others to do the job for us. That's why we do our own PR. We do our own In-store concept, we do our own marketing campaigns, and we take our own grip on the E-tail space to make sure that we build the brand because if you want to be the leader I don't believe you can expect others to do the job for you. A leader must always lead.

[ Jamie Hans Thorton. ] You talked about the larger market in safety helmets in type I and type II. Is this a sort of direct result of the conversations you've been having for the last 18 months?

Yes. Yes. And I think it's also a lack of knowledge when we talked about this 3 years ago because if you look at one of the first Uvex helmet that has been launched is actually a type I element. At that point, we had one solution in safety. That would play at all the different price points and a lot of the different technologies. And of course, we like to do innovation and product development. During this period, we have developed a generic solution that can play in most of the harness elements. So you can actually put in those in 90% of the harness helmets on the market without any adoption. And with that opportunity, then we also got the opportunities. So if you would have asked me the same question in 2019. I said, no, we can't do it. Now we can.

And just on the kids market, which seems a no-brainer really. How will this work in terms of ASPs and margins with an existing customer who does add up helmets? Will you charge less for the kid helmets? Will they not just say it's the same in lay, we want the lower price?

Yes. So I think, of course, with our market position that we have at the moment, we still decide on the pricing. And of course, we know how much we want to charge for certain helmet at certain solutions, and that will still be the case in kids helmet. For us, when we look at the kids helmet assortment, there is a lot of different helmet opportunities out there. We have done a huge science project together with KTH about understanding more about kid's helmet, what should we address in the kid's helmet and so on. And that's one of the reason also why we are rolling that out now. We will, and we have also before given a little bit of discount to kid's helmet because we think it's right to protect your kids, they normally play at different price points and so on, and we will continue to do that, not with a massive impact on margin.

Yes. Emanuel Jansson, Danske Bank here. Coming back to the safety segments. Looking at the Uvex collaboration, you just announced -- would you say that it's more likely that you will conquer Europe market before the U.S.?

No, I think we will actually do them both. We started earlier in Europe. So of course, Europe become natural to do a little bit quicker and especially the Nordic. And I mean, you also see that we are succeeding quite well in Nordic having 3 out of the biggest 5 construction companies is a clear evidence of that. What we have seen for the U.S. market is the overall awareness is higher. Normally, when you talk to the construction companies, they are much more about -- aware about MIPS. So I would say the runway will not be as long. And I think within a couple of years, I will be very surprised if they wouldn't be at the same level.

Okay. Perfect. And could you provide us with some details about how big the U.S. market is in the safety segments compared to European?

Yes. I think -- I mean, there is -- the difference is very big in terms of the market, and there is, of course, a lot numbers in terms when it comes to the U.S. market, but it's almost the same size as the European market, but the difference is that you have a much bigger retail market in the U.S. market. There, you have the Home Depots and all of them which sell a lot of retail helmets that we don't have to the same extent in Europe. In U.S., we have much more independent contractors. That goes into Home Depots and so on and buy their own helmets, then tend to spend quite a lot you normally see this Brim helmet and so on, and they can easily cost up to around USD 200. So in terms of size, they are almost the same size. If we look at the type of helmet and the type of market structure, it is very different.

Okay. Perfect. And a few questions more, but on the type I helmets, what's the average price on that type of helmets?

Yes. And if you look at the Type I helmet and you go from the starting point, then you are at around USD 5 to USD 7. That's the traditional yellow plastic hard hat. And then if you go to the highest priced one, you will find it at somewhere around USD 25 to USD 30. It's not a perfect definition. But if you take a majority of the sales, that's how it's structured.

And I can assume if you're moving into like type I helmets, they maybe are a little bit less safer than type II helmets.

Yes.

And then you also might be able to add on other types of components like the ventilation or pads, et cetera, that you talked about. Is that some kind of strategy that you might entering cheaper models and then you also can do add-on sales.

Yes. And I think already at the start when you start looking at type I type of helmet, a big part of those elements, and we have already seen that, they disqualify themselves because they are not fit for the type of accidents that we normally are designed to protect against. So already there, they are not fit for purpose. And this qualifies quite a lot of the helmet. They -- if you fall or get a bigger impact on your head, most likely they will not sustain that type of accident. Then we also have a criteria and a requirement that we decided on quite early in the process, it always needs to have a chin strap. If you don't have a chin strap on, most likely, the helmet will not stay as it should on the head. Normally, if you have a fall accident in most of the cases, you actually fall with your butt first, then you hit your head on the ground. If you fall with your butt first, you don't have a chin strap on the helmet will not make a lot of sense. So I would say that there is an opportunity to address helmet. Some of them, we need to go back, like we do in every type of helmet we do. First of all, you don't offer enough protection. But indeed, it is also an opportunity in the second discussion to offer alternatives way. And we are doing that also in the type II helmet. In a lot of the helmet, you see that the head band or the head part of the helmet is not strong enough, then we offer a way to support that and to create a stronger head band and so on. And also the head band is, of course, a replacement product from us.

Perfect. Excellent answer. And lastly from my side, just coming back to the virtual test lab and so on. Do I understand correctly that you will sell this kind of service to your customers?

Yes, we can say quality of service or we add it to the license fee. We like to have a variable business model. That's normally how you can scale up and so on. So if we do a project, if they pay a certain fee at one point, -- and then they want us to take a much more integrated part of the development process. That cost a little bit more, and that's added to the license fee.

[ Karin ] Handelsbanken. Going back to safety, surprise. The -- you mentioned that the discussions still start with that we don't need MIPS in our safety helmets, -- and when they say that our accident frequency per helmet user is so low compared to sportswear at least personally, it's very high. So how do you argue around that. They say that we have 10,000 helmets and 10 accidents per year. So how do you still make them believers?

Yes. I think, I mean, one accident is one accident too much. And we always say that the best accident is the one that didn't happen. But of course, accidents do happen. And I think anyone that had a serious accident or a lethal accidents, which also happened at some point, probably will do everything they can to avoid it. I will be very surprised if someone says, I only had 10 serious accidents last year. So not that important. So far, I haven't come across that discussion. Normally, is actually other way around. Most companies in the world are very safety conscious. They normally want to do everything they can to make sure that they have a better option that is designed to protect at more accidents than they are doing today.

And then a question about this In-store concept where you are really sort of putting the MIPS brand at the forefront. Are you getting any pushback from helmet manufacturers because that's sort of making their brands maybe less visible.

Yes. I think, I mean, first of all, we normally don't make -- sometimes we make the agreement with a smaller display and so on with the brand, then it normally carries a brand logo, and they bring that to the store. And sometimes they pay for that type of exposure in store. But when we talk to the bigger stores, and you will see some of them already is installed here in Stockholm, we are stalling a couple of units also in the U.S. There, we're taking a whole [ wall ] and that agreement we make with the store, and we have the MIPS logo and the MIPS exposure, and they want to do that because if they sell MIPS, normally, they get couple of bucks more for that type of helmets. So it's also incentivizing them to have a better exposure. So, so far, we have not got any pushback from the brands.

Great. Just on the dividend policy is great. But capital allocation, have you sort of buybacks or anything like that?

Yes, we have. I mean I am an old CFO, Karin is a great CFO. We think about that all the time. But at the same time, with all the things that we have on the agenda at the moment, growing. That is our top priority. That's what we focus on to grow as fast as we can. At one point, it might be that MIPS need to think a little bit more on the financial mechanic or how we can optimize the balance sheet, we just feel that this is not the right moment at this point, but it might change in the future, then probably growth is not as high on the agenda as it is today.

I don't need the mic. Just one question. [indiscernible]

Yes. Thank you, Peter. That's a very good question. So first of all, we are changing the way we go to market. We will try to fill the helmet with as much value as possible. Then the comparison between volume will not make sense anymore. That's why we want to look at much more on how we are doing per category and the value that we are driving in that sense. So we had a long discussion about it, and we feel that it will only distort the picture rather than to add more value. And the same is when it comes to brands, a number of brand wins and so on, we will probably still talk about it when it comes to unofficial numbers or marketing and so on when it comes to brands in safety because there, it's still about the brand wins. When we look at the sport category, we have 120 brands. One of them might not bought on volume one year. The other year, they bought a bit of volume. Is it still a brand. So how do you actually do that mechanic? It's the same with the number of models that we have put on the market. Like Karin said, we are not far away from having more than 1,000 products that has been launched on the market. Some of them will be discontinued because [indiscernible] helmet life or a model life is somewhere around 8 years. Given the success we have had, we sort of got the success in 2014. 8 years down the road, that will start to happen. So is not about being less granular in the reporting. We will not follow up volumes internally because it doesn't make sense in the same way. And then it will just be an artificial creation of something to the stock market that we're anyway not addressing in the same way. So hopefully, an answer to your question.

A follow-up on the TAM expansion -- you increased the TAM for bike quite a lot here. Is it the risk that you have overstated the numbers because of the boost in the pandemic? Or how have you addressed the strong bike market last year?

Thank you. That's a very good question. And we looked at not only one year, we looked at a little bit longer period of time. And what we normally do with volumes is, of course, we match it also with the factories because if there is volume anywhere, you need to have that also produced somewhere. So that's a good reference point. And then we also talk to the brands, and we might be wrong, but then we have the lowest assumption of all the key brands that we have, and they are significantly wrong or more wrong than we are. So it's a careful assumption of what the market should be. If you go to bigger brands and ask for the same thing, you will probably get a slightly higher volume than we estimate.

And then a short follow-up on that. The current trading now we see in the market with the consumer confidence coming down, retailers reporting pretty weak numbers, the inventory, et cetera. What do you see in your pipeline here in 2022 that is relevant to know about?

I think 2022 is quite a long period. And of course, we don't do any forward-looking statements, but there is a couple of things that we have seen that we also talked about in the last quarterly report. First one is that we start to see inventory filling up in the U.S. market. There is quite a lot of very cheap bikes and very cheap helmets in the channel and in the key retailers at the moment. You do not see the same thing in the European retailers. They don't have as much stock. They haven't also been aggressive when it comes to sourcing. So it's a very mixed picture on the market. We haven't seen any major slowdown yet. But of course, we're only early in the season, and there can still happen a lot. So far, our main contribution to the growth that we have seen is in Snow helmets, where you have the exact opposite. Fantastic start of the season. And in ski resorts, you don't have any inventory at all, and that's what starts to fill up now, and that's the production that is mainly running now. Okay. So thank you, everyone. I think it's spot on. Yes, a couple of minutes late. Thank you, everyone, for listening in.