Portmeirion Group PLC (PMP) Earnings Call Transcript & Summary

Good morning, ladies and gentlemen. Welcome to the Portmeirion Group PLC preliminary results presentation for the year ended 31st December 2020. [Operator Instructions] The company may not be in a position to answer every question received during the meeting itself. However, the company will review all questions submitted today and publish responses where it's appropriate to do so. These will be available via our Investor Meet Company dashboard. You'll be notified when they're ready for your review. We'd also like to remind you that this presentation is being recorded. Before we begin, we'd like to submit the following poll. And I'd now like to hand you over to Mike Raybould, CEO of Portmeirion Group. Good morning, Mike.

Good morning, everybody. Thank you for joining me today. This is Portmeirion Group's Full Year 2020 Results Presentation. I'm going to switch my camera off now so that we can see the screen and you can see the slides, which I'm going to go through. In terms of what I'm going to cover today, a brief overview of 2020 and our results. I'll then do a deeper dive into our trading and balance sheet and sales markets. I'm going to spend some time on the progress we've made on our key parts of our strategy. I'm going to look at sustainability and ESG agenda. And then I'll come back and summarize everything and give a forward view. As Mark has said, there's opportunity to raise questions, and I'll look forward to getting those and take those questions, deal with them at the end. Okay. So in terms of an overview, key headlines really were against a very tough backdrop, severely disrupted year because of COVID, both in terms of enforced retailer shutdowns and supply chain disruption, we were actually really pleased with how robust and resilient our brands performed around the world. Our like-for-like sales were down 11%. But what we saw was a much improved level of trading in the second half of last year. We beat our initial forecast in the second half by around 7% and returned to profitability with a profit of just over GBP 4 million. We're pleased to see that trend that we saw, that positive improvement in trend continue through into the first quarter of this year, which gives us encouragement for 2021. I'll talk a little bit about balance sheet. We finished the year with a strong balance sheet, net cash positive. In terms of our strategic progress. I'm going to cover this in some detail as we go through, but we've made significant progress on our key strategic initiatives. In particular, we've been focusing on our ongoing transformation to online and digital. This remains the biggest opportunity, I believe, that the group has to grow both top and bottom line in the future. We've been investing the proceeds from our equity raise we did in June last year of around GBP 11 million behind our key strategic objectives. And as I said, I'll go through the progress that we've made in due course. Moving on to our headlines in terms of P&L. Our total revenue was down 5% -- just over 5% year-on-year and like-for-like down 11%. The difference being that we had the full year impact of an acquisition of Nambé and a small contribution at the end of the year from our acquisition of Portmeirion Canadian business. As I said, we had an improving trend despite COVID as we went through the year. In the first half, we were impacted and were down 20% like-for-like. In the second half, down just 6%. So that improving trend helps our profit in the second half. We have had a positive cash inflow during the year of just under GBP 2 million before we have the benefit of our equity raise proceeds, which leaves us in cash positive for the year. We have significant headroom in our facilities. At the end of the year, we had around about GBP 25 million, GBP 26 million of facility headroom, which means we have a strong balance sheet, room to invest behind our strategy as well as the regular working capital requirements of the business. Moving on to our balance sheet. We continue to have a strong balance sheet, bolstered by the equity raise that we did in the middle of last year. As I said, significant facility headroom to invest behind our growth strategy. A couple of notable things here on this slide. Firstly, we had a working capital improvement of just under GBP 4 million. This was largely driven by improvement in our receivables and our debtor days. And this was driven really by 2 things. First of all, an improved mix, more online sales, particularly for our own websites, where it's cash on order. And secondly, a reduction in the debtor days for some of our more traditional customers of retail customers and distributors around the world. We see that improvement carrying on rather than being given back next year, and so that's a good pickup in terms of cash. The second area I would pick up is stock and inventory. Our headline inventory is up during the year, but I put a walk on the slide here that shows the key movements. Our like-for-like inventory was actually down 3%, GBP 0.8 million, and we expect the like-for-like inventory to reduce further in 2021. But in addition to the like-for-like, we acquired a new business in Canada, and so we brought their stock into our insulated number. And we also had new raw materials and stock for our hand sanitizer production that we turned on in the second quarter of last year in our Wax Lyrical division. The final thing to say on this slide, I think, is the Pension Scheme. This relates to a longstanding heritage pension scheme that has been closed for over 20 years where we're putting in an annual contribution. The deficit has increased in the year in terms of how it's assessed with accounting standards. That increase is really all about changes in the discount rate rather than any material change in portfolio values. And it's something we don't think is a significant or of a concern to us going forward. I want to move on to a deeper dive into our sales by market, by key geography. We have 3 significant core markets in the U.K., in the U.S. and South Korea. All of our markets were impacted in terms of retailer shutdowns. But you can see from the numbers here that our U.K. business was -- is particularly resilient, 2% down, and that shows that our progress and the desire to become more of an online digital business has largely mitigated the lockdowns and the retail shutdowns. In the U.S., our sales were up 3%, but that includes the full year impact of the U.S.-based Nambé business that we acquired last year. If we extract that, then our like-for-like sales are down around 10%. Again, that's driven by a larger-scale COVID-enforced retail shutdowns, offset by strong online growth. In Korea, South Korea, our third biggest market, we've planned our sales down. And as we previously announced with Korea, we wanted to deal with some historical overstocking and excessive grey shipping that had happened with that market. So we planned the market down. What we have done is continued to focus and be far more disciplined with this market in this area and saw some really reassuring and positive progress. First of all, within the market, our distributor, their sales out to the end consumer actually finished up 15% year-on-year, so it grew despite COVID and the impact on retailers in that market. The new product that we designed for our distributor in 2019 has started selling really well and accounts for now around 30% of the sales out in that market and indeed has led to repeat orders for our factories for this year. So Korea is down, but now at a much more stable basis. We believe we've dealt with the historical issues with overstocking from the grey ship market. We expect from this position to be able to grow in a much more consistent and sustainable way in future years, starting in 2021. Canada was previously in the many decades a 50-50 joint venture with the Nambé company. During the year, we have bought the remaining 50% and now fully own our Canadian distribution business. We've done that because we believe there's an opportunity to do more with the Canadian market. In particular, they have a very low level of online penetration. And so by absorbing the Canadian business and leveraging our existing U.S. teams and U.S. infrastructure based in New Jersey, we think we can grow the Canadian market going forward. In terms of other markets -- Rest of World and other markets, you could see that we have been very resilient in terms of our year-on-year performance. All markets have been disrupted by COVID. There's no doubt about that. But as I said at the outset, we're really pleased with how resilient our brands have performed in our key consumer markets. So I'm going to move now to look at our strategic progress. We are investing more money than we've ever invested behind a number of initiatives. There's a slide number 9 that we've put in our presentation the last couple of rounds. And so just to really recap, we're focused on 2 twin goals. The first thing is to deliver far more consistent and accelerated sales growth each year. And secondly, at the same time, increase our operating margins, effectively converting the sales more effectively into profit. We have 6 key strategic building blocks that our organization is working on to deliver those goals. The first 5 are concentrated on driving accelerated and more consistent sales growth: putting our brands at the heart of everything we do and having more vitality with our product development; significant piece of work in terms of digital and online transformation that I'll cover in some detail shortly; being much more disciplined in our South Korean market and having a more stable market and building a sustainable business there; leveraging the benefit of recent acquisitions, both Wax Lyrical, our home fragrance business in Nambé, across all of our global sales markets; and finally, being more targeted in terms of generating and building additional Rest of World export markets. And again, I'll come on to that in some detail. Those 5 things will drive consistent sales growth. In terms of operating margin growth that we're talking here about, operating factories more efficiently through investment, building capacity in our factory so that we can -- as we grow, we can push more volume through or leverage our asset base more effectively and be more effective in how we procure across our global teams. So together, those 6 things drive both the top line and the bottom line. So I want to spend a little bit of time on the most important one, the biggest opportunity that we see for our business and our brands, which is this online digital transformation. So we set a target to reach at least 15% of our group sales going through our own website platforms. We're actually taking that target up now and believe we can get to at least 20%. And on a wider basis, in terms of volume that goes through all online channels, so including our own website, but also retailer websites in our core markets, we want to get to at least 50% of our business going through online channels. In terms of progress we've made, both trading and strategic, a lot has gone on in the last 12 months. Our own website sales -- and there's a chart there in the middle -- went up 69% year-on-year. And that accelerated as the year went on, and particularly in some of the initiatives that we've been investing in come into play. As an example, in the U.K., website sales were up 81% year-on-year in the second half versus the second half in the previous year. And at higher average prices, we raised our margin points by 12 points as well as getting that growth. In the U.S., we invested and relaunched all of our websites, 5 or 6 different websites, re-platformed. They went live in October last year. And already, we're seeing improved conversion levels of at least 20%. In terms of our total online concentration in our core markets, we grew from 30% to 47% during 2020, clearly aided by the change in consumer behavior through the COVID pandemic. And our customer list, which are important for our own website, grew by 95,000 customers, which is over 47% in the year. And this is important because over 50% of our own website sales come from customers that have bought from us before or returning customers. So as we build that list of quality customer database, then it gives us a very clear indication of pathway of growth in future years. Staying on online and digital for a moment. I think it would be useful to -- I wanted to show the scale of the road map that we have in this area of the business. And so there's an indication here of some of the top line initiatives that fall under this project. And the items at the top -- to the first 5, which are shaded darker, are things we've already done through today in terms of quarter 1 2021. It started with people and capabilities that we've invested and hired a lot more people in both digital marketing and in online e-commerce sales within the business, massively expanded our teams and our capabilities in that area. We've improved all the content and retaken photographs, much improved photographs of all of our key ranges so that they can demonstrate and show up our product more effectively in online space. At the same time, we've invested in a new digital asset management system. A Global DAMS that has gone live in the last few weeks that enables us to push that content around all of the retailer websites in a much more efficient way. As I noted, we have relaunched all our U.S. websites and are already seeing good payback from that. And just in the last week, finally, we launched a virtual sales showroom. And this is a virtual house where all of our products and brands are represented, and our sales team can take buyers from retail groups, customers around the house, demonstrate our product in a virtual space with all the specifications. And this is a great tool that helps replace some of the more traditional routes of selling that we've done pre-COVID. In terms of the next tranche of projects that are shaded slightly lighter, things are going to go on in the next few quarters. A new product information management system will enable us to grow and be more efficient in terms of how we deal with the specifications of all of our products in the online space. We're going to do a complete overhaul of our U.K. websites next to redesign, improve the customer journey and user experience. And we believe that will enable us to convert traffic into sales more effectively. CRM data systems become far more important to us now in that we're in contact with the end consumer. And so understanding the consumer, what they're buying, how they're buying, what they want and building that data systems and being able to segment that data, again, will enable us to grow our own website sales more effectively in the future. We're also working on products. And what's important here is to recognize that taking existing successful ranges and reformatting them into different packaging and different formats that really works online gives us a great opportunity to increase our basket size and also connect more effectively online with our customers. With all that growth going on, we need to make sure that we can ship the products and maintain service levels, so we have a series of different investment programs going on in our warehouses in the U.K. and in North America to incrementally take up our dropship fulfillment capabilities. We increased the capacity in 2020 through additional shift patterns, process improvements in 2021 in both warehouses, both sides of Atlantic, we are again taking capacity up, and we'll continue to do that on our road map as we go forward. So to finish off with online, it really is a comprehensive road map that touches all areas of our business and people through the platform data. Our systems are warehousing, but it's very exciting. And as I said, we're already seeing the benefit in terms of trading. Moving on to the second key strategic driver of sales growth, which is about new products, bringing newness to the market. And we really want to improve the vitality rate of new product that we launch. I think the key headline on this one is that despite all of the disruption that we've had to deal with in the last 12 months we've managed to keep on track our pipeline of new products for launch this year. We've got some really exciting new products coming to market. At the center of that is a huge new collection of Sophie Conran Tableware. Sophie Conran -- the Sophie Conran Collection has been for 10 years, one of our most successful contemporary ranges and sold all around the world. We have a significant new collection for that coming out in the next few weeks. And that will be launched in the U.S., in the U.K. and Canada, Australia and Europe, already all around the world. And it will include not only our traditional tableware, but also glassware, cutlery, wood serving and metal serving items. We're also launching products under Spode. We're extending some of our heritage lines, which are still important to our underlying business, both in the Spode Christmas Tree range and the Portmeirion Botanic Garden range as well as launching new products under our Nambé brand and new home fragrance ranges as well that tie in with some of our most successful tableware ranges. So for Wrendale -- ROW is the Wrendale and Portmeirion Sophie Conran, we're now going to have matching home fragrance ranges for people that love those tableware ranges. Third biggest -- third big driver of strategic growth is our Rest of World markets. So we have these 3 core markets: the U.K., the U.S. and Korea. We want to build 2 or 3 new significant markets to complement those. What have we done? We've done a complete reset really of our export sales teams, new hires, put people into our target markets, including in the Middle East and China and Korea, a new leadership. We started signing up new distributors and online distributors, and we really expect to see progress now, growth this year and some real momentum going into 2022 and 2023 in the Middle East and the Far East and China and certain parts of Europe. As I said, we bought the remaining 50% of our Canadian distribution company in August last year. We made a good start with that business. It's been amalgamated into our New Jersey U.S. operation, comes with very low levels of online penetration, so a really good opportunity for our U.S. team to work with Canadian business and really take the online sales channel up. So we're expecting good growth, as I said, from our Rest of World markets this year, 2021, and real momentum going into the next couple of years. Finally, in terms of sales growth drivers, as we have talked about, Wax Lyrical, our U.K.-based factory for home fragrance, a good year for Wax Lyrical in that we were flat year-on-year despite all of the disruption from COVID. A fantastic piece of agility in converting production lines, candle production lines to be making the hand sanitizer that is in such short demand in the country in quarter 2. We were able to help support communities in carry-ons and sell some to the NHS Trust in the North of England. We've got a lot of learning from that project, which is going to enable us to launch into new categories in 2021. We're investing GBP 1 million right now in a big permanent factory extension and new production line, a filling line, that will enable us to make and design and sell hand and body soap, lotions and products. Some example -- pictures there of some of the new ranges. This factory extension is on track to go live at the end of quarter 2, and we expect to have sales in the second half of this year. The other areas where we see significant growth opportunities for Wax Lyrical are within our core markets, increasing our online penetration and launching new products, particularly product of titan with existing popular tableware ranges. And the new geography is about taking a U.K.-centric basis and getting extensive market exposure around the world. We're launching in the U.S., a website in a couple of months' time and signed up new distributors in other markets, including China. So we expect this division to grow in 2021 and again really have momentum once the pandemic is behind us in the next couple of years. So those are 4 key sales drivers. I want to turn to operating margins to the other side of our strategy, taking our operating margins up. And this is really based around taking off actually cost down by 10%, generating global procurement savings and increasing our capacity in our factory so that as we grow we can push more volume through and leverage that volume against our asset base. So again, just an indication of a scale of change and what we're doing here is a road map. The top 2 items were things that were done in the middle of last year, and we have 3 big projects coming online at the end of the first half this year, all automation projects in our Stoke factory, heat release, clay lifting and in-line spraying, big investments in automation, around about GBP 1.5 million of capital spend that will be paid back in 2 to 2.5 years in terms of cost reductions. But critically, it also takes up our capacity, and the amount of product we can make every hour will go up as a result of that, which will be great because as we grow around the world in our sales markets, we can push that through, push that through the factory and get more volume on the asset base. Going forward, towards the bottom, there are 3 or 4 things that are in our road map that are under consideration for the next phase of activity in our factories. And as we investigate those and bring them through kind of a capital approval process, they'll become firm projects and then start to come through and deliver benefits in 2022 and 2023. We're making good progress with our procurement project. The in-house teams working with procurement specialists outside the business. And our target is to get to a run rate of GBP 1 million a year procurement savings that will feed through into our operating margin. We're on track for that. Some of that will come through, around about 1/3 of it in 2021, and then it will build up and ramp up in the next couple of years. So overall, good progress on efficiencies and capabilities, all of which will feed into our operating margins. I want to move on to our strategic progress and come on to sustainability. This is an important area for us as a U.K. manufacturer and a business that works across the world. Clearly, we are very keen to do business ethically and in a sustainable way as we can. We're very aware of the impact that what we do has on all of our stakeholders and the environment and the communities that we live and operate in. We focus on this, as you'd expect, consistently in recent years. And we start from a good place, I think, in terms of environment. In terms of energy usage, there's a photo there of our Wax Lyrical factory that already uses 60% of its energy from wind turbines. We already have 100% of our manufacturing waste products in our Stoke factory being recycled back into the operation of the manufacturing process. In the last 12 months, we've gone further, replacing lighting with LED lights and our factories reducing the firing temperatures in our kilns, reducing cycle times so that we can reduce the amount of energy we're using for every product that comes off the production line. We converted all of our Wax Lyrical rediffusers from alcohol to a natural blend. That means that the carbon footprint is lower. And we're going to continue to invest in energy and environmental-facing initiatives in the next 12 months. In terms of people and social, the big thing here really has been about looking after our people in this COVID environment, making our workplaces safe. So a huge amount of time and money invested in doing that. I'm very glad that today we had extremely low incidence of COVID within our operations. Our factories today are working at good and pretty much full capacity. We continually seek to train and retrain our people not only on COVID safe procedures, but also regular and general health and safety. And in terms of governance, we have and we continue to apply all of the key codes that you would expect in terms of QCA corporate governance, modern slavery, anti-bribery. All those policies can be found on our corporate website. We've also made changes to our Board during 2020 with new executive directors and new nonexecutive directors, both bringing fresh ideas and energy, but also fresh challenge in terms of new non-execs as well. So to sum up where we are today, as I said at the start, clearly, a challenging year in terms of what we've had to deal with. A huge amount of respect to our teams and our people who have worked tirelessly through the year, adapting to all the challenges that COVID has thrown at us. We're actually really pleased how resilient our brands and our trading performance has been, and we've seen huge growth in online. And that gives us great confidence that there's a lot of headroom for us to grow in that area with investments we're making in the future. We saw an improving sales trend through last year. In particular, our half 2 was better than we expected by around 7%, and that positive momentum, trading momentum pleasingly continued through into the first quarter of this year. Our factories are operating at good pre-COVID levels of output in a safe way, and we'll continue to invest behind all these strategic initiatives that I've gone through in the last 10 or 15 minutes. Again, our twin objectives are sustainable sales growth and improving our operating margins each year. So we're expecting at this stage to return to growth in 2021. On that basis, we'll be able to resume dividend payments as well in a sustainable way while still investing money back in the business. So we're optimistic about 2021 and really think we're going to go into the next couple of years with great momentum from all the work we're doing in all parts of the business. I hope that's been helpful to everybody. I really appreciate you coming on the call today. I'm looking forward to going through the questions that have been raised, as I've gone through. And I'll try and pick up and answer as many of them as I can.

Thank you, Mike. Thank you very much for your presentation. And ladies and gentlemen, do please continue to submit your question using the Q&A tab situated on the right hand corner of your screen, which just one might take a few moments to review those investor questions submitted already. I'd like to remind you the recording of the presentation, along with a copy of the slides and the published Q&A can be accessed via our investor dashboard on the Investor Meet Company platform. I'd also like to remind you that your feedback is important to the company. And immediately after the presentation has ended, you'll be redirected for the opportunity to provide feedback in order that the company can better understand your views and expectations. Mike, thank you for the presentation. We've obviously had a number of questions submitted by investors during the presentation there. And perhaps if I could just direct you over to the Q&A tab and just ask you to read out the question where appropriate to do so, that will be fantastic.

Okay. Thank you. So I'll start at the top. I'll try and answer as many of these questions as I can. The first question is, is it an issue that you make certain products in China in terms of the consumer, given your British brand heritage, example, Spode? So it's not an issue. I mean Spode is 250 years old as a brand. And for many years, some of it has been made in our U.K. factories and some has been made in other parts of the world. In particular, a range that we call Spode Christmas Tree that has been selling in the U.S. around Thanksgiving and Christmas because of $10 million a year. That has sold since the 1920s and for at least 10 years has not been made in the U.K., but still grows each year. So I don't think the location of manufacture is a particular issue. The second question is what's the distributor share in Korea. The honest answer is I can't tell you right off the top of my head what share we have in Korea within tableware. What I can tell you is for 30 years, particularly our range called Botanic Garden, has been the leading and most successful tableware range in that market. This is why we took such difficult and tough action in the last couple of years to cut down the amount of product that was being reshipped into Korea because the price points are higher than other parts of the world. So protecting that market is important going forward. And we're certainly not losing share in that market. And I think we have a more stable base now to grow in a sustainable way. The next question was about Portmeirion Canada acquisition. I'm sorry. It sounds like the sound cut out. So I apologize for that. Is it a game changer? What are the growth prospects? I don't think Canada is going to become a GBP 20 million or GBP 30 million market. I think it's a full year impact. I think it's GBP 4 million, and I think we could maybe grow it to GBP 6 million to GBP 8 million over 3 years, and that really will be about online penetration. It has a very low level of online at the moment. I see no reason why we shouldn't have the same level of online penetration in Canada that we have in North America. There's a question about why Korea is an important market, south Korea. Kind of what I said earlier, it's been a big market for about 30 years. The South Korean consumer really values British brands and German brands and are very loyal. And so it's a big market for us. We will do everything we can to protect our brand there. We've taken the tough action, if you like, in the last couple of years. Now I think we get the benefit in the next couple of years. There's a question then about a long-term view and our share price performance and the decline from a peak of around GBP 12. What are the reasons for that? As far as I understand it and obviously are going to accept the price, I think it's a couple of things, John. Firstly, it's some bumps in the road that we had with reporting Korea, South Korea sales. So in '18 and '19, we missed the forecast because of excessive grey shipping in Korea, and we had to take action to -- I'll describe to pull it back. And I think that then -- the second thing is a lot of share prices were hit in March last year when COVID became the #1 thing in our mind. So I think those are the 2 things. What we're concentrating on now is we're getting investor trust. I think we're doing that with the action we've taken in Korea. We've sorted that out and building the capability of the business. And hopefully, you can see, as we've gone through the presentation, the work and the investment that's going in to really take this company and all of our brands to the next stage and the opportunities that are there. There's a question about this percentage split of sales between business to business and business to consumer and what percentage of those sales are online compared to physical retail stores. So very broadly in the 2 biggest markets, the U.K. and the U.S., which is roughly 2/3 of the group sales, nearly 50% of those sales now go through online channels, and that's rapidly advanced in the last couple of years from maybe kind of mid-teens through to 30% and then from 30% to nearly 50%. Do we own our own retail stores? We have a very limited number of retail stores. We have some outlet stores in the U.K., 7 or 8 that sell, in particular, something we call seconds. And one of the outputs of our manufacturing process in Stoke is that we get product that's nearly perfect, but not quite. And so we sell that throughout the stores. And we have a number of stores, again, 6 or 7 Nambé stores in some of the southern states in North America. Retail isn't a big part of our group, and it's not a big part of our strategy in terms of growth. And we'll wait and see what -- how the market comes back to traditional retail post-COVID. Rest of World, there's a question here. Rest of World, while small, grew well. Is this organic? And why has it been so strong? Well, I think we have well-known brands that -- actually, we sell to around 70 countries, and I think that's fantastic. And in particular, as I said, the made in U.K. product really resonates in some of those export markets. So I think that COVID has impacted different markets around the world at different times of the year. South Korea was impacted in the first quarter last year and then gradually recovered, whereas the U.K. and the U.S. kind of came later on. So I think COVID has impacted different markets at different times. But we certainly see a big opportunity ahead of us by being more focused and investing a bit more in some of these Rest of World markets. Question, antique sales have picked up recently. Has it been reflected in your heritage brands? To be honest, I didn't realize that, but our business today is a combination of heritage brands and heritage ranges that have sold in pretty much the same format for many, many years and newer more contemporary ranges. Both of those are doing well. We will continue to invest in our heritage brands, expect to grow those, but are equally focused on more contemporary product development, gifting, and as I said, online formats. The next question is about why build toiletries capacity when there are so many contract manufacturers? So a couple of things here. The production line that we are putting in right now is GBP 1 million investment. The vast majority of that spend supports the production line that can be used not only for filling hand soaps, hand lotions, hand sanitizer and hand cleaning bottles, but also can be used to fill our core product ranges; candles, reed diffusers. So if you like, there's a dual functionality there. So we can use it to extend the capacity of our existing core lines as well as go into the new category. Can I give more detail on the process of the Canada market? I think there was a question that I've dealt with on Canada, but it's a small business at the moment. It was a 50-50 joint venture for around 30 years. We weren't in control of the management team, but we sold products into it. And then the management team there were responsible for selling it on. The change now is in owning 100%. We have amalgamated into the group. We have complete control. And as I said, the opportunity is to leverage our existing North American sales team and our website knowledge and experience over Canada as well. Will the dividend payout, is the next question, would be lower than previously, has more capital as reinvested back in the business? I think that what we've done is we've put out and advised brokers in terms of expectations that we will expect to resume dividends gradually for full year '21 and then improve in full year '22 and beyond. In terms of those, that guidance that we gave, it is at a bit lower level than maybe it was back in 3 or 4 years ago. But we think that's not only the right and prudent thing to do at the moment given that we're still in the middle of a pandemic, but also I think there's a huge opportunity if we invest the right amount of money back in our business to grow. And that should then be reflected in the capital value of our company and hopefully share price. Could you broadly outline your intended dividend policy? I think that's the same question, so I hope we got dealt with that. I'd like to understand our views on capital allocation and potential buybacks. So in terms of -- that's about buying our own shares. We don't have any current plans to do that. We raised capital in June last year, GBP 11 million, and we raised that capital to invest more and accelerate our strategy, our growth strategy, in particular, online and digital transformation. Do you see any distressed opportunities, is the next question? I think that's talking about acquisitions. I think different companies have obviously handled and have been impacted by COVID in different ways. Whilst I think we've been very resilient and I think navigated it best it could possibly have been hoped. I'm sure there are other companies that have been impacted different ways. We've got a lot of work to do with the 6 brands that we already own. And so my first priority is to deliver on the opportunity that we see for those 6 brands, and I talked through some of the things we're doing to achieve that. Further down the line, if there's a compelling acquisition opportunity that comes along, then absolutely, we would consider it, but our first priority is making good and really getting the benefit from what we already have. Just a couple more questions. Next one is playing devil's advocate. Could you summarize in a few sentences why should I invest in your company compared to other potential opportunities? Well, that's a good question. So within a few sentences I think we are a great consumer brand company. We have great brands that are in love around the world. We're well diversified in terms of geography. And we've identified some significant growth opportunities both in terms of top line and bottom line, in particular, telling the story of our brand, the quality of our products in online and digital space, I think, is a big, big opportunity for us. And then the final question, you mentioned that you want another 3 growth markets. What's a conservative view about how much growth you expect to see from these? So going back to our sales analysis chart on the table, the 3 big markets of U.K., U.S. and Korea, we certainly expect those to grow, particularly driven by our online investments. The Rest of World markets, which are smaller, should have more upside for growth in terms of percentage and absolutely down in dollars. So I'm not going to pluck a number out of the air today, but we should certainly be seeing some significant growth in some of those markets. I think that is all of them. Did complete them all. Thanks everybody for submitting the question. It's really great to get that level of questions coming through.

Mike, thank you very much. And as you say, you've answered all the questions. So thank you very much indeed for that. If any further questions do come through, obviously, Mike will get the opportunity to review those as well. And Mike, just before we redirect investors to give you some feedback. Perhaps just a final few closing words, if possible, please?

Yes. Thank you, Mark. So look, again, thank you for joining me today. I hope that this has been useful. It's great to better share what we're doing with a wide group of people. We're going to carry on doing these broadcasts coming through, so I hope they're useful. There is feedback about what we've covered and what we haven't covered, then it would be very useful to have that. As I said, we're very optimistic in terms of our company, where we are today. We have a very strong balance sheet. We see some great opportunities. And the whole business is working very hard on delivering that shareholder value. So thank you very much.

Mike, thank you again for updating investors today. Could I ask investors not to close the session. Should be automatically redirected for the opportunity to provide your feedback. If you've accessed the meeting from our website, the feedback page will appear in front of you. If you've accessed the meeting via the link sent to you in the e-mail, will simply just be asked to log in to submit your feedback. And as Mike said, we greatly appreciate it. On behalf of Mike and the Portmeirion Group PLC team, I'd like to thank you very much for attending today's presentation. That concludes today's session. Thank you.