Thule Group AB (publ) (THULE.ST) Earnings Call Transcript & Summary

So welcome to Thule's Capital Markets Day 2025. My name is Catharina Paulcen, and I'll be your moderator for today. So we are broadcasting live from Thule's head office in Malma, where the audience is a mix of participants on-site and online. So we had an exciting morning, not only because of the product demonstrations, but also because it's snowing quite heavily in Sweden at the moment. So you could say that the winter season really kicked off in Sweden today. And now it's time to kick off this capital markets event by introducing our first speaker, President and CEO, Mattias Ankarberg.

So again, welcome to our Capital Markets Day. I have really been looking forward to today to present our new financial targets and the path to achieving them. And I know that a lot of you have followed us for a long time, but we are excited to today share the results of a deep dive we have done, analyzing how we have made money in the past and how we'll make more money in the future. I want you to leave today with a number of things, but 3 things in particular: Firstly, Thule has a proven ability to grow profitably, and it is our conviction we will continue to do so at an even higher pace. Secondly, you will be introduced to what we have coined the Thule Champions. These are the core of our future growth plans. And then thirdly, efficiency gains. We are fortunate to be in an industry with supportive trends. But right now, the market is tough. There's no doubt about that. I wish I could change that, but of course, I can't. But what we can do is control our costs and drive efficiency gains. We've already initiated several things, and the Thule Champions will guide us to where more efficiency gains can be made. So we will cover this and more during this day, and we will structure the day in 4 chapters. We'll start off talking about who we are. After that, we'll cover what we do better than anybody, how we create value. Following Chapter 2, we will have a short Q&A session and a break. Chapter 3 will be around our ambition. What is it that we want to do? And following that presentation, there will be another Q&A session and break. And then lastly, we'll talk numbers. We're going to go through the path to reach our financial targets and a bit of a longer Q&A session following that. Now in the interest of time, there are many other important topics that we will only cover at a high level today. So we will only, to some extent, go into things like sustainability or AI or D2C. But you are more than welcome to ask questions on any topic during any of the Q&A sessions. So let's get into it. Chapter 1, This is Thule. Thule is a product company and an outdoor company. And more specifically, we make what we think are some of the world's best products for people who want to live active lives outdoors. And we've been around for quite some time and done this for quite a long time. Thule was founded in 1942 in the south of Sweden, in Småland, more particularly Hillerstorp, and we have ever since been on a journey to develop new products and enter new product categories. And last year, in 2024, to the very top right of this chart, you can see we were more busy than usual. We entered not just 1 or 2, but 3 new product categories at the same time. We organically stepped into both dog transportation, which we call Active with Dogs, car seats and then through an acquisition of Quad Lock, entered performance phone mounts. And today, Thule looks a little bit something like this. [Presentation]

Today, Thule is a global company, and we like to do a lot of things in-house or have in-house capabilities as we call it. We have a sales footprint of 138 markets, and we have many product categories. We report 4 major product categories. The main -- the biggest one, which represents a bit more than half of the sales of the company, it's called Sport & Cargo Carriers. Here, you find roof racks, rooftop boxes, bike carriers and more. second category is for RV Products. RV stands for recreational vehicles, motor homes and caravans. We do awnings, we do bike carriers for RVs and more things. Active with Kids & Dogs is where you find the multisport and bike trailers, strollers, child bike seats and the newest categories, dog transportation and car seats. And the fourth category, Bags & Mounts is luggage, various types of bags and the Performance Phone Mount business that we acquired a year ago. Now I mentioned that we have in-house capabilities, and we particularly have strong in-house capabilities in R&D and supply chain, I'd like to point out today. We have a global R&D and test center in Hillerstorp in Småland where Thule once was founded, where we have several hundred development engineers working to develop the best Thule products we can possibly do. Having said that, we also have satellite offices to cater to some specific market and category needs across the world, in Australia, in Belgium, in China and in the U.S. We also produce a lot of what we sell in our own factories. We have manufacturing sites, 9 sites, 9 factories across 7 countries, which has been good for us for many reasons, financially, yes, but also from quality control and being close to development, et cetera. And particularly in these times with regionalization of supply chains, it's, of course, good for us that we can make a rooftop box in a factory in Germany, in the U.K., in the U.S. and in Brazil. So I mentioned that we are a product company and an outdoor company. We're also a growth company. And again, founded in '42, but we've been a public company since 2014, which is the year that this graph starts. The blue bars is the sales per year and the green line is the EBIT over time. And as you can see, it's developed with a boost of COVID and then a slowdown after, but except that, in an almost straight line. If we exclude some of the currency effects that generally have been positive, the sales development has been 5% on average per year. So a net sales CAGR of 5%, excluding currency effects. And we've had good profitability with an EBIT margin of just below 18%, 17.8% on average. One of the reasons why Thule has experienced this good growth is that we are positively positioned versus some good trends. And I'd like to point out 4 major trends today that we benefit from and that we innovate against. So number one, increased outdoor participation. So more and more people want to live active lives outdoors. Some of the best statistics we can find in this area comes from the U.S. There is something called the Outdoor Industry Association that publishes numbers yearly and sometimes more frequently. And if you look at those numbers, you'll find that 10 years ago, just over 50% of all Americans said that they engage in outdoor activities, and that's broken down in many ways. A boom during COVID, but actually continued to grow also after COVID. And last year, the number was almost 60%, 58.6% to be very specific. And what I think is interesting with statistics too is that the increase in outdoor participation is driven by some new consumer groups, more young people, more women and more ethnic groups. And if you look at the core users, the people that are most often engaging in outdoor activities, the most frequently engaged, just that core group increased by 5 million Americans just last year. So clearly, there is an interest in the outdoors that continues to grow, good for Thule. A second important trend is what we call bike is the new car. And e-bikes has really changed the game, how we move around and around mobility in many ways. Today, about 50% of all the bikes sold in Germany are e-bikes. And of course, that enables easier bike commuting, longer distance commuting, new ways to move around. Very good for Thule. In addition, there were big infrastructure projects to build more bike lanes. EU alone has a project -- a multiyear project to build thousands of kilometers of new bike lanes and has allocated EUR 7 billion to that project, which a report last month said, was on track. The third trend I'd like to point out is what we call near home vacationing. So people, of course, like to go on vacations, but there's a clear trend towards less international and long-distance travel and more travel closer to your home. And when you ask consumers why, there are actually several different answers to why. Some say it's hassle-free. You don't like the hassle of the airports and the travel. Some focus on the flexibility. I can decide last minute, I can decide to change my mind if I want to. Some connected to opportunities around remote work, combining work and vacations. Others talk about sustainability as a big driver. But in any case, it's, of course, good for Thule that people travel closer to their homes because they will travel with their car or potentially their bike or their RV and they need to bring things, and we offer products for that. Last trend I'd like to point out, which is important for us is around safety, particularly around both child safety and pet safety. And here, the trend is driven both by increased regulatory demands, which at both the country and other levels are rising, but also general consumer awareness for more safe solutions to transport kids and pets. Again, another trend, of course, good for Thule and something that we can innovate against. Now if we zoom in on the near term, though, it is clear and you are aware, we are in a tough market. And I think we all could mention some negative macro statistics and consumer stats that describe the year. But I think one chart that illustrates a lot of the market dynamics we are experiencing this year is on the right-hand side here. This is from The Economist and what they report as the World Uncertainty Index. It's a measure of how much uncertainty is mentioned in economic reports, et cetera. And it clearly rose up very quickly at the beginning of this year. And that impacts everybody, also us at Thule, of course. And if we look at our sales development this year for the first 3 quarters of 2025 that we have reported year-to-date, we are, of course, very happy to have a total sales growth of 13%, excluding currency effect. But more than all of that comes from acquisitions, of course. The Thule organic sales is negative 1.5%. Now it's -- many of you would know this. It's hard to find a perfect peer group for Thule. But if you look at a selection or the set of, I would say, publicly listed hard goods outdoor companies, they are experiencing even tougher times than we are. Let me add a little bit of nuance and color to this organic 1.5 minus number because I think it's worth to spend the time on that. I think a year ago, we were feeling quite optimistic. We had a 3.5% organic growth last year, which was in the right direction. Consumer sentiment was getting for sure in the right direction in Europe, and you started to see the signs also in the U.S. And we had a very good start to 2025. It was just early, but it looked very promising in January. And then the whole situation changed with the introduction of tariffs that led to a lot of other things and, I think, reflected partly in this World Uncertainty Index chart. And what we've seen really is 2 effects this year. Firstly, for sure, a weaker consumer in general. Now the U.S. consumer confidence numbers are almost at a 50-year low or thereabouts, worse than most crisis. Europe is better, but still far below historical levels. And if you ask consumers their intent to buy sport and outdoor products, most studies would say that's about 20% below the year before, a little bit even lower in the U.S. and a bit better in Europe. But the other factor we're seeing is also retailers being really cautious, being focused on profitability, cash, liquidity more than growth or expansion. And probably for many of them for good reasons. There's for sure been store closures, restructurings and even a few bankruptcies in our space on the retail side in the last 12 months. So what that means, of course, is they're very cautious to take in products to expand and to particularly hold inventory over low seasons, et cetera. So that also impacts the landscape we're in right now. What we see in our own sales is clearly that our own channels that are impacted by the consumer sentiment, but not by the retail dynamic are doing much better, clear growth. We are performing the best in the premium end, the higher price points where we have that enthusiastic consumer who is willing to spend the money for products doing what they love. We are doing better in Europe and in North America, as many of you are aware. And of course, new products and categories really help. So there are some bright spots for when the market will turn, and we will get back to a bit of that later today. But -- and it, of course, will turn. It's further ahead in some markets and categories. But still, so far, it is a tough market here and now. But independent of the near-term market situation, and I believe much more importantly, we are on a journey to create a bigger and more profitable Thule. And a lot of things have happened just in the last 2 years that will give good impact in the coming few years. So I'd like to walk you through a few of those things. I mentioned we have entered 2 new categories successfully last year. Both the dog transportation and the car seat entries have in their respective first years, set new records for best first year sales of any category at Thule. So well received, which is really good for us. We entered a third new category with the acquisition of Quad Lock, the global market leader in what's called performance phone mounts, a good category with double-digit growth and performing plus 15% growth so far this year, also positive for us for the future. We have upgraded significant parts of our sport & cargo product portfolio in just the last 2 years. And you may remember, I said in the beginning that sport & cargo is a bit more than half of the sales of the company. We have developed stronger products in both premium and mid-price in rooftop boxes, in bike carriers and more, and we see good impact on sales, but also on margin, and we have a really strong gross margin 2 years in a row. And of course, upgrading half of the footprint helps. We have also been focusing on some efficiency gains. And some of you know that we have taken down inventories a lot. It was high, but the work still needed to be done to bring it down, and it's more difficult in a tough market. But we have reduced inventory by SEK 1.5 billion over the last period, which, of course, helps finance a lot of the growth initiatives that we are driving. We have also changed our focus in North America, both on the cost side and the growth side. So we have done a few things. We have put in place a dedicated North America sales and marketing team focused only on North America, which is a new structure compared to what we had before and a more flat structure. And that is looking very promising. We're very happy with the work that the team has started to do. We're focusing our growth efforts on fewer categories where we really believe we have the strong opportunity to win. So we did a big job of upgrading our North American bike carrier portfolio that really paid off for us in Q2, which drove much better numbers in Q2 than in Q1. And the second opportunity we're going after is pickup trucks, where we have an opportunity. We know many of our consumers already have pickup trucks, but we haven't brought any products to market in many years. So in just 3 weeks, there will be new products out to address also that market segment. And then lastly, again, on efficiency gains, we've had a mentality and a good practice of always working with continuous efficiency gains and continuous improvements at Thule, but we have this year taken a few more actions to move the needle a bit faster. We discontinued the North American car seat development program in Q1, partly to focus the North American team, partly to focus the R&D team and other resources and partly because of market reasons that we can get into, if you like. We are changing or have changed the organization structure to what I said, a more flat, more lean structure, also closing a satellite office in North America, consolidating to fewer places that saves us costs. And we are -- not the least, we have launched a big initiative to extend and automate our biggest warehouse in Poland, which will save us SEK 100 million on a cash basis on an annual basis when fully operational and will go live in 2027. So a lot of things have been set in motion in summary that will give effect over the coming few years. You have probably all seen that we have updated our long-term financial targets, and they are updated to be more ambitious than the historical performance. So let me walk you through one by one, how we are thinking about our financial targets. So firstly, the growth target, we have changed to be clearly focused on organic growth and to be focused on a percentage number, so a continuous growth per year. And we think those 2 changes better reflect the way we think about growth and think about growth over time. Comparing the number to the previous target, which was SEK 20 billion in 2030, I think that target, it's important to mention, was set in May 2022 at the tail end of COVID, which was a different time. And we think the more relevant comparison for the new target is the historical performance, which was 5% over time, as you've seen. So it's more ambitious, and we believe we have the plan to deliver on that. And we hope that you will have the same feeling when you leave today. We'll cover a lot more around that during the day. The EBIT margin target is 20%. It's not changed. It was 20% before as well compared to historical performance of 17.8%. And the dividend payout target or ratio is 75%, not changed and very much in line with historical performance. And I'd like to take the opportunity to also mention when we talk about financial targets that Thule also has clear and quite ambitious sustainability targets, and those are not changed. Those remain. Now I'm guessing that some of you are sitting out there thinking, okay, that's probably good targets, but when are you going to reach them? And the short answer is we have the ambition to reach them in the midterm, which for us is about 2 to 4 years. And we will go through a lot more detail today. But to give a little bit more nuance upfront, you saw before that Thule has grown 5% per year over time. That's done in a market which saw a GDP growth of about 2% to 3%. So 2% to 3% outdoor overperformance, if you like. Now we believe that we have the ability and the plans in place to increase that overperformance. But of course, to get to 7%, we need some market growth. Do I believe we will have good market growth already next year? Probably not. Do I believe it's there in 2 years? Yes, for sure, it could be. Could it be that it takes 3 or even 4 years? Yes, it could. But independent of exact timing, the more important point is that we are convinced that we have a plan in place that can deliver higher growth and higher profitability compared to the historical levels. Let's get into Chapter 2. What is our competitive advantage? How does Thule create value or in maybe simpler terms, what has worked for us and what has not worked as well for us. So we've talked about products several times today already. And for those of you here live in the audience, you had the opportunity to see and interact with some in the morning. And we really have a wide portfolio of great products. We have the benefit of being recognized for having great products by, of course, consumers and ambassadors, but also through design awards. And we have, I believe, no less than 38 design awards in the last 2 years alone from the 2 most prestigious awards, the iF Design and the Red Dot Design Awards. And we have a wide portfolio. We're in many different areas. We're in bags and luggage. We are in tents. We are in backpacks. We are in bike trailers. We're in dog products. We do surf transportation. So we do quite a lot of things, a wide portfolio. And I think it's very interesting that just a few of those product categories have driven the value creation of the company. Actually, when you look back, just a handful of product categories represent 90% of the sales growth and the profit growth of the company. And if you look at those product categories, 73% of our total sales was made up of those categories in 2014 at the IPO. 79% was the number in 2019, and it's continued to increase since. And to me, this is a little bit unusual. Most companies that I've worked with or seen, you have a good core business that, of course, you nurture and want to develop, but then you have some growth initiatives that you think should move the needle and be the future. But at Thule, the things we've had for a longer time has actually delivered more growth than the newer things, which is a bit unusual, I find. And I think it's really interesting. And I'd like to share a few things around these Champions, as we call them, the champion product categories because it's important for us. So firstly, these Champions are categories where we are the global #1, and they are in small markets or pockets as we call them. And we have 6 today. This is who they are. And I use the word categories separately from the reported categories, which is a more broad definition of product categories. So it could be good to be aware. The first 3 we've had for a long time. We started out with roof rack in the '60s, roof boxes or the first one was the ski box in the '70s and bike carriers a decade later. All of those 3 are reported within what we call the Sport & Cargo Carriers reported product category structure. We have 3 more. We have awnings within the RV product category. We have multisport and bike trailers as part of Active with Kids & Dogs. And then lastly, we have performance phone mounts, which came with the acquisition of Quad Lock reported under bags and mounts. And in all these 6 categories, we are, again, the clear global #1. And we're not just global #1 by a little bit. We're like #1 by a bit. There's a distance to #2 here, a bit of a moat, if you like. And secondly, these are all small markets, niches or as I call them, pockets, typically SEK 2 billion to SEK 5 billion global market sizes and typically with a sale of around SEK 1 billion for Thule, a little bit up and down, but thereabouts. And they also share some common characteristics, mentioned a few. First of all, they all fit our brand really well. They're products that help enable this active life outdoors, and there are products where consumers that are enthusiasts really appreciate these products. So it's a good fit with the brand that we have as outdoor and quality, et cetera. Secondly, they all have good market tailwind. There is category growth for sure, some on volume, but there's also -- because of this enthusiast consumer, people are willing to spend for the best product in these categories. This is what people are passionate about and people are willing to pay money for that product, which helps the category growth. And then thirdly, it's not easy for anybody to do. There are some barriers here or a bit of a moat, if you like. And that could be for a number of reasons. So some are driven by regulatory reasons for around safety regulations. For example, things you put on a car and drive on the roads, there are clear regulations around that. Some is around intellectual property, where there are some clear strengths for Thule and some barriers. Some because they are actually quite tricky to manufacture and you need a lot of capabilities to do that, and we have in-house manufacturing. Some is more because of the complexity. Think of a roof rack. You could say how hard could it be. It's just a steel bar on top of a car. Well, all these kits, as we call them, fit kits that goes with all the cars, there are thousands of vehicles, and that needs to be updated constantly and tested, et cetera, et cetera. So as we like to say, the more difficult it is, the better it is for Thule. And then what all that means is that we have this fantastic innovation capability. We can develop these award-winning products. But in these categories, we get leverage from that. We have innovation capabilities that deliver new products, and then we drive premium in the category. We drive growth. We are positioned to do so, and we also get scale effects because we manufacture them ourselves. So it's great to have them. But even more important is that we are good at developing them. You've seen that they've driven the growth, right? And I think we have many things that make us suited to do that better than anybody else. But instead of taking my word for it, let's hear what some of the industry insiders have to say. Now if you're a mountain biker, you may have seen this clip before, but here is how an outsider describes Thule's product development process and the work in some of these categories. [Presentation]

So that's a description of how we work with developing products and developing these Champions, particularly where we have our strongholds. And at a very high level, Champions are really important to us because as the global market leader and as the player with the best innovation capabilities, which sort of allows us to control our own destiny or at least shape our own future. But it also comes with some responsibility, I would say. So let me take you through this. It's, of course, fantastic to be able to out-innovate competition. If you are working with premium products for passionate consumers, innovation plays a role. And with more know-how and as the global #1, we are bigger and have more resources than others, we can out-innovate other players in the field. And that means, to some extent, that we can kind of grow our own market because when we develop new products that enthusiasts are willing to pay for, that raises the price point, the premiumization, but also find new use cases, new pockets and develop the categories through our own efforts. It also means we sort of expand the moat or the barriers for others. We have the strong Thule brand, but also as we get bigger and bigger in small markets, it limits the opportunity and the ease of entry from other players. And I've been in consumer goods for over 20 years. And a lot of the people in the industry that I talk to these days are talking a lot about new competition, particularly Chinese competition. And of course, it's a force in the marketplace that everybody has to address somehow or relate to. But the beauty of being really big and global #1 in small pockets is that we are more shielded than others because we have the size and the limited market potential and the strongest capabilities and resources. Also, and importantly, from a financial point of view, since we also do a lot of things in-house, we get scale effects. We get economies of scale from driving organic growth in these Champion categories. Now I mentioned that the Champions come with some responsibilities, I called it or some howevers. I think there are 2 things I'd like to point out. Firstly, to be #1 is not static. You need to continuously innovate and drive the market. So it's important to have a long-term mindset and continue to innovate and bring new products and new features and upgrades to the market to remain #1. Second point I'd like to make is developing new Champions take a lot of time and resources. It took decades to be global #1 in rooftop boxes. And again, a long-term mindset is really needed to win over time. So the last point I'd like to make around these Champions is that some of them have come through acquisitions. So I mentioned in the beginning, there were 6 Champions in our portfolio today. The 3 that are within Sport & Cargo Carriers, have been around for many years. But the 3 at the bottom have come through acquisitions, now not that frequent, but still 20 years ago Thule acquired a company called Omnistor, which was the leading player in Europe for doing awnings and bike carriers for RVs, and that's developed into the RV business that we have today. We acquired a company called Chariot in 2011, an Iron Man athlete in Canada had developed a product, so he could bring his kids while exercising, and that's become the multisport and bike trailer category that we see today. And last year, we acquired Quad Lock, which is the global market leader in performance phone mounts. And I think the acquisition of Quad Lock is a good example of how we think about potentially bringing new Champions into Thule through M&A. So I'd like to invite Toby up on stage to have a bit of a chat around that.

So Toby, you've been involved in quite many acquisitions over the years. So how do you think this acquisition compared to other deals you've been doing?

Well, yes, firstly, yes, good afternoon, everybody, maybe first of all. But I would say one of the main things was we went into a lot of depth around the Quad Lock acquisition. The project actually started well over a year before we made the acquisition, and we used that time to go into a lot of depth on the project. For those who don't know me, my background, I was 7 years Head of M&A for a large Swedish corporate. I've also been CFO for a consumer company in Asia Pacific, and Asia Pacific includes Australia. So I think I could contribute quite a lot with my background. And then in making the acquisition, firstly, we did a very thorough due diligence, as you always should do in major acquisitions. We got really under the skin of the Quad Lock business. We really saw what an attractive acquisition target Quad Lock was, a really strong management team, really strong financials. So that was #1. But I think probably what was maybe different was in parallel to the acquisition, we also did a lot of homework on what really makes sense strategically for Thule. We worked a lot on what fits Thule, and we didn't call it Champions at the time, but it was the -- what you're seeing today and being presented today around the Champions and really the strategic fit with Quad Lock was a really great fit with Thule and adding another clear champion position to the Thule portfolio.

Sounds good. So Mattias, what do you think were the greatest challenges with this acquisition?

Yes. I think to Toby's point, we went through a lot of things, but I think 2 things come to mind. Firstly, to get really comfortable that this was a champion as we call it now, a global market leader that had the ability to out-innovate their competitors and not their phone case company. But we spent a lot of time on that and got convinced. And then I think the second point that came up is fit with the Thule culture. Of course, cultural fit is always a theme. But I think partly because of what Toby mentioned, we took our time. We had a lot of meetings digitally, of course, but physically in Australia, in Sweden. We involved quite a few people from both management teams to really get a good feel. And we had a lot of discussions around the brands and the overlap we see in the brands and the ambition for the brands and the consumer base that connects with the brands. And I think that made us a lot more comfortable that this is a good fit with the Thule culture as well.

So we have seen some nice growth numbers from Quad Lock in the recent year. But Toby, how is it really going?

No. It is good growth numbers. Quad Lock is growing 15% organic growth this year. So good growth. It's growing -- I mean, Quad Lock is a global business, as you know. So it's growing globally, a bit better in Europe than North America, just like the rest of Thule, but good growth overall, good margin development. So financially, absolutely good development. And I could mention also when it comes to integration, we had an intensive period in the beginning kind of plugging in Quad Lock to the Thule company, financial reporting and other areas like that, we plugged in quickly, of course. And now we're working step-by-step through further integration in the areas that we think it makes sense and really adds value. So to give a couple of examples, we've created one sourcing office in Shenzhen in Southern China to drive sourcing there. You can say on IP management, we now have one organization and Thule is taking the lead in running IP matters. And you can say on the other hand, Quad Lock is really supporting the Thule side in building a business in Australia and building a better platform in Australia, which is something we're focusing on. And then you could finally on kind of sharing learnings in sales channels as well, where Quad Lock clearly has been a strong leader in D2C side, and we've shared learnings that way and the other way also on the wholesale channel. So yes, a lot of intense activity and a lot of shared learnings and a good financial development. So yes, we're happy.

So Quad Lock -- so final question. Quad Lock has been part of Thule for about a year now. So what is the greatest learning you think, Mattias?

Well, I think actually some -- 2 things that actually connect back a bit to the process we had before the acquisition. I think we -- it was good that we had some of the more, let's call it, sensitive discussions upfront. There were, for sure, some -- there were 2 founders that were still part of the management team, really proud of what they built, as they should be. But we were really clear that we have a monobrand strategy. It will be integrated under the Thule brand umbrella, and we had that discussion upfront, which I think really has helped. And then we spent a lot of time before signing the transaction, how will we work together on what I call the operating model. And I think that has enabled us to do what you just described, Toby, to quickly do the sort of plugging in and then quickly get to the sort of more value-creating activities and the synergies. So spend the time upfront, I guess, is the learning.

Good leaning. Okay. Thank you for a nice chat. Toby and I will now leave you to continue your presentation.

Thank you. All right. So now we have talked about the Thule Champions and the value that they bring. What has worked less well for us. And I have to say it's kind of hard to actually find something that's been really disastrous or bad. You've seen the financial numbers. We've moved in the right direction on growth and at good profitability for many years. But of course, there are some things that haven't developed as we had hoped, and we can learn from that, and we should learn from that. And I would like to point out a few. So in 2017, we are here. We had been a few years on the stock exchange and really focused on becoming a consumer goods company. And we launched some ambitions to become what we call the contenders or challengers in 2 new markets, in bags or in certain areas of bags and luggage and within strollers. And now that we look back, we can see that, yes, that has delivered some growth for us, but it has not created the new legs or the new pillars of the company that we had hoped when we launched this ambition. And I think it's interesting to spend a bit of time on why. You may remember that some of the products I showed early on that I said were great award-winning products are also in these categories. So we have clearly done some great categories -- sorry, some great Thule products. But the point is that these are not, to the full extent, great Thule markets. So for one, these are big markets with a lot of competition. Take the bags market we were going after or at least the segments, they were SEK 80 billion at the time and much bigger today, of course. The #1 player in luggage and bags is Samsonite Group. They have 8 brands. It's kind of hard to beat on a number of factors, talent, distribution, et cetera. And the same thing with strollers. It's very competitive. It's very fragmented. It's a lot of, lot of players. Also, the markets are having these categories some growth, but I would say modest, low single-digit growth numbers. And I would say also a mixed brand fit. For sure, there are some things that connect really well to the Thule brand, but we have learned that the core consumer that is, of course, easiest to introduce new products still to is the outdoor passionate person, the person who want to live that active lifestyle outdoors. So great Thule products, but not fully great Thule markets, means we don't get the leverage from the innovation capabilities that we have at Thule. But what I think is also really interesting is there are some real gems within these businesses. So if you look within these darker blue sales numbers, we have, for example, had really strong traction in what we call all-terrain and running strollers. We launched that in 2014 with a lot of good learnings from the multisport and bike trailers that we had, and it's been on a really great growth journey ever since. It's also a really great Thule product, but it's also a great market, a clear niche. This is a product you use as a second stroller because you want to be out and active with your kids. It's about a SEK 1 billion size market. It's a strong brand fit. I almost said obviously because we just talked about being outdoors and being active. And there is good growth from the markets from young parents wanting to stay active and stay sporty also when they've had their children. So great Thule products and a great Thule market, and we are the global #1 with a lot more to go. So lastly, if we compare these growth efforts then to how we have been investing for growth, what can we learn from that? And at Thule, we invest -- our growth investments are mainly investments in product development, which we take as an expense on the P&L line. And this is how the R&D spend has developed over time. And for those of you who follow us, you would recognize this yearly number, which is the R&D spend as share of sales that we typically -- or not typically, always publish at the end of every year. And this is the split of the R&D investments over time. And I think there are a couple of interesting and positive things to take away from this. Firstly, I think we have been fairly good at maintaining R&D spend in our Champion categories that we have seen drive the value of the company. It was a bit of a dip, but we're bringing it back towards the end of the chart on the right-hand side. And secondly, I think it's been good that we sort of put money behind our ambitions or when we were going after an ambition, we've also really invested to try to make that happen, which I think is what an ambitious innovation-driven company should do. And then I think there are 2 interesting learnings to take away from all this. As we know that the Champions have created the value, make sure to spend enough to have a strong continuous product pipeline to drive that value going forward. And secondly, when we go after new categories, which we have and which we will continue to do, go for pockets, go for small niches where we have the strong credibility to play and build it step by step. So to summarize Chapter 2, we create value through champion product categories. We are most successful when we are the global #1 in pockets where we can out-innovate our competitors. Building challenger or contender positions in big markets has not paid off. And these champion categories have the beauty and the benefit to allow us to, to a large extent, control our own destiny. So that concludes the presentation part of this chapter. And now I'd like to invite Toby back up for a Q&A session.

So you talked about what's been creating value, and you also touched a bit upon competition, especially we're curious to learn more about the competition from low-cost countries. Is there a risk that we have new competitors, especially from China, entering our space and outcompeting us?

Well, it's, of course, a very important question and something we've been discussing a lot, and we see happening a lot in different industries and different companies. But I think for us, it really goes back to this concept of Champions. When we are clearly #1, it's more difficult to attack us, call it, the market size isn't that big. It's also not as attractive for others to attack us. And then on top of that, we typically have these barriers of entry of some sort what we talked about before. So I honestly fundamentally convinced that, for sure, we should never underestimate competition and new players, but we are much better positioned than a lot of other companies out there.

One question we see here from an online audience is if you could elaborate a bit about the development in North America.

Yes, absolutely. So it's -- for sure, North America has been the most challenging marketplace for us this year, really came to, I would say, a stop, but there was a really sort of a pause in the mentality and in the ordering in Q1, and it was really, really weak. And we have seen consumer numbers go a little bit up and down, unfortunately, now down again just the last couple of weeks. So it continues to be a tough space. But I think the more important point for us is we really took some actions early in the year. We have set a new sales and marketing organization in place. We're focusing on 2 big growth priorities where we really think we can win. And both of those things are going really well. So for us, it's about executing our plan and delivering on that.

See if we have any questions from -- yes, we're running with the microphone here.

A couple of questions. Agnieszka Vilela from Nordea. So maybe starting with your growth ambitions of 7% organic growth per year. Can you give us a flavor on what's behind that assumption and acceleration in the growth rates? And I think you mentioned that you want to see improving markets as well to reach that?

Yes, I can give you more than a flavor. I can give you a plan, and you will have it in the next 2 chapters. So we'll come back to it a lot. But you are right, Agnieszka. For sure, we think we can do better than we've done historically sort of with our own performance and with the resources that we have available. But of course, we are not naive. We need a bit of market growth to help us. But we will go through the details of that later on today.

Okay. And then maybe a follow-up also on your strategy for the products outside of your kind of champion space. What do you want to do with that products where you don't see -- you have that position today. And will you continue to spend as much as you did on R&D in that categories?

Well, have you read the chapters? No, we will get back to some of that as well. But I'd say -- maybe it's actually easier to address later. It's kind of hard to answer now. But it is, for sure, clear that we will focus more on the things that have created value, but we'll also focus more on future things where we have the insights that we have a higher chance of succeeding, if you like. And there are other things that we will do less of, and we will come back to that later today.

Carl Deijenberg with DNB Carnegie. So I had a question on -- you had the slide on the Champion categories, and you also had the slide on the nonchampions. You were talking about the ambitions back in 2017, you were contenders in packs and bags and so forth. And I guess now also with the new categories, child car seats and dog crates, you are sort of contenders there as well. Big markets, quite strong competition. So what's going to be the difference this time? And how do you make sure that the development in those will not look the same or those becoming Champions instead?

Great question. And I think -- we'll touch a bit on that later also, but it's important. So let's talk a bit about it. If you take these 2 categories that we've just entered -- or 3 with Quad Lock, they're actually quite different and much more like the -- what we think the champion categories. So take dog transportation as one example, and I'll leave the other maybe for later. Dog transportation is a fairly small market. It's about a SEK 2 billion size market globally. There are no global brands. There is good market growth in general from pet, but also from pet safety. And the technical capabilities to do a dog create when it comes to aluminum, plastic testing, we saw in the video, crash testing because it's a car-related product, we think we have a strong position to be better than anybody, and we have a really good traction. So we actually think that -- and you will hear later the future Champions, if you like. We have some really good and interesting things going on already today inside the company that we can scale up.

Daniel Schmidt from Danske. I think back then, when you talked about bags and strollers and sort of your efforts in those categories, you also mentioned between the lines, I think, that these are global products. You've otherwise been a very sort of Western-oriented company because that's where your core consumer is, and this is a way to grow in Asia basically, which has maybe not worked out in the way that you expected 8, 9 years ago. Do you see pockets where you can be big, that is relevant in Asia that you're not in today?

Well caught. Yes, we do. And it is also, at the same time, true that we are, for sure, strongest in the Western markets, Europe in particular, but also North America. And we are -- I guess it's important to say to, we are a product company. So sort of the first lens, if you like, that we use is to say, can we do the best product? And then if we can sell that in 4 countries in Europe or in 180 countries in the world, that's question #2. But having said that, for sure, there are some opportunities also in the Asian market where we can find some nice pockets for us going forward.

Maybe you'll come back to that, I don't know. But it's been sort of very obvious that China is quite small for you, and it's been small for a very long time. And then maybe you talked about sort of your performance versus the outdoor market and there were some listed names in there. If you compare it to the ones that are not public, which is, I guess, harder to do, could you give us any numbers on your performance versus your sort of closest competitors in your sort of core legacy businesses in the U.S. or in Europe as of late?

No, it is a good question. And I think one of the almost automatic drawbacks of being sort of clear #1 is that there's not much other market statistics to be really goes. But there are some numbers. And I think -- see how we put this best, and you can help me out here, Toby. But I think, for example, in the U.S., where we have the toughest markets, we have strong channel partners, strong retailers who we work really closely with and they share their inventory level and sales out of Thule products, but also the sale out of the entire product category. And there are some statistics, private statistics though that maybe you get your hands on. But -- so in the U.S., in traditional Sport & Cargo Carrier, it's down about double digit this year, which is slightly more than us. We have taken market share, particularly in bike carriers, where we have also had a big push. In Europe, I think actually, that could be a good example, we have an RV products category, and there are several listed RV players. So I guess you can compare our performance to that from an industry perspective. And I don't think we put the weighted average together, but it's clear that we are doing better than the listed ones.

Yes. Yes. So I think you can see the kind of limited market share data we can see, you could say, which is not public, but maybe through some of our retail partners, we are gaining share and we're holding share. So yes, there's not a significant change in the landscape, you could say.

Okay. Good. And just finally, also sort of you talked about seeing a better market, of course, and who knows if that's going to be true in 2026 or not. And we'll see -- but I guess there's also been a fairly sort of significant destocking going on. Do you have any view on where sort of your counterparts or your distributors, retailers are really in that journey? Is there any sort of indications that, that is easening in any way?

Yes, there are some indications, and it's part of that market picture that we talked about, and I'll come back a little bit, but let's talk about it now. So I think it varies quite a bit by category. And without going into too much detail, the RV industry is coming through sort of a weaker period and now entering a more positive situation. We can see from, again, internal metrics and things we do with the European RV associations that stock levels are coming down at the dealer level. The RV industry is typically split in 2 parts, right, the OE part and the aftermarket part. And the aftermarket sales has actually been good this year and good. It's been growing, and it's been back to fairly good levels, and we continue to see that now. So their inventory is coming down and aftermarket is growing, and now it's just -- but the OEs to work through their production inventory levels of components, et cetera, they're taking some production stops, so we accept more positive there. It's a bit more difficult in some of the juvenile and bike-related sort of retail spaces where it's much more fragmented. And it's tricky, too, because it's a sort of total picture. Maybe this is too long of an answer. But to give you an example, I was visiting a good customer that have one of our products, important products, and they also had a competitor products and the competitor products was at half price of their best seller than it used to be. And I was asking why? You can barely make money. They said, "Well, we have so much of this product left in stock." You don't have a lot of Thule products, but I have a lot of the other products. So I need to clean that out before I can buy more. So they're in a more fragmented space, I think there are more -- less visibility and probably more things to work through.

So let's take a final question from the online audience. If you could please clarify the growth target. Is it an average target over the -- you talked about the midterm. Is it an average growth target over the midterm? Or is it 7% growth in a single year?

It's an annual target. So our ambition is to grow with 7% per year.

Good. So now we will leave you off the hook and go into a coffee break, and it's going to be a 10-minute break. So see you back soon again. [Break]

So welcome back, everybody. We'll now continue with the third chapter, which is focused on what it is we actually want to do going forward. Here, we will cover our strategy our ambition and the most important priority is to deliver on that strategy and ambition. And I'll start out with the strategy. So based on the learnings we have, we have phrased our strategy like this. We want to be big in pockets, united under the Thule brand. We will be in several product categories, but there is an identity that is the Thule brand that it all fits into a monobrand strategy. And let me add a little bit more nuance to this. When we say big, we mean number one, ideally, right, by a distance. There is some moat, some that separate us from competition. We would love to be big in many pockets and many attractive pockets with good growth and good connection with our enthusiast consumers. And when we say pockets, I mean niches or specific market segments. They should all fit our identity, which is the Thule brand. So that's how we formulate and phrase our strategy. And one might think that downside of this strategy to be big in pockets is that it's kind of limiting for growth. Pockets are inherently quite small. But we don't think so. We see a lot of opportunities actually. And to tell you a bit more about the opportunities that we see, I'd like to invite Aden Johnson up on stage, our Vice President of Category Management. Welcome, Aden.

Thank you, Mattias. I'm Aden Johnson, Vice President of Category Management here at Thule. I know a lot of you are already very familiar with Mattias and Toby. But for a lot of us, this is our first time being introduced to one another. So I want to take just a moment to let you know a little bit about who I am and my background. I've been with Thule now for just over 4 years. I spent the first 2 years of my time here at the North American headquarters in Seymour, Connecticut, and then relocated last spring with my family here to Sweden to take on this role that I'm in now and join the group management team. And over my career, I spent about 20 years in the consumer goods space. primarily with global lifestyle brands that are really well known for well-designed, innovative and high-quality premium products. I started my career in New York with Ralph Lauren Corporation and worked there for about 8 years. And then after that, moved into another soft good lifestyle brand called Vineyard Vines that brought me out to Connecticut. And then from there, pivoted into more of a hard goods role. So joined the Swiss company, Victorinox. Many of you know them. They make the Swiss Army knife and I was Vice President of Merchandising and Sales Planning for Victorinox. And then that brought me to Thule just about 4 years ago and here today with you all. So just a little bit of my background so you know who you're talking to here. And I think what I'm going to talk to you now about are consumer insights. Mattias just told you about our philosophy around big in pockets and how that's a bit of a criteria in terms of us deciding which new products and new segments to get into. He talked a bit about market trends and how we use that in our decision-making process. But a third angle to this is talking to our consumer understanding who they are and how those market trends apply to them specifically. So we'll go through that. And before I get into it, and just so you know where the data that I'm going to share today comes from. We ran a survey about a year ago with existing Thule consumers who have bought a product from the brand within the last 24 months, from our largest markets. There's about 1,000 respondents to this survey just so you know where these numbers come from. But these are existing Thule consumers that we've spoken to. So let's get into it. If we look at the consumer at a high level, there's 3 things that I want you to remember about them. And the first is that they are affluent. 70% of them when we surveyed make more than the national median income in their home countries. And so what that means is they've got disposable income that they use to fuel, right, their outdoor passions and invest in premium products from brands like Thule to help them do that. So the first thing to remember is that our customer is affluent. The second is that they are active. 2/3 of them tell us that they exercise at least 3 to 4 times per week, and that overindexes the general population in a lot of our largest markets. In a few minutes, I'm going to get into a little bit more depth there on what we mean when we say that they're active. But that's the second thing to remember. So they're affluent, they're active. And the third thing, they are family-oriented. They have kids and they have dogs. If we delve into the kids' numbers for a second. If you look at our largest markets in the general population, it's about 25% to 30% of households that have children in the household. If you look at the Thule households in those markets, it's 2/3, nearly 2/3 have children in the household. So clearly, that's more than twice the general population that have kids. And then if we look at dogs, I'll give you an example from our 2 biggest markets. In the U.S., 75% of Thule households have a dog in the household. It's about 50% in the general population in the U.S. If we look at Germany, it's 35% of Thule households have a dog in the household compared to about 20% in the general population in Germany. And if you ask these people have dogs in their household, actually 1/4 of them have 2 or more dogs in the household. So when we look at the investments that we've made in kids products and dog products and continue to make and you see why that is because we already have a very engaged consumer that fits this profile that we can tap into and build more lifetime value with. So the 3 things to remember here about our consumer. They're affluent, they are active and they are family-oriented. They have kids and they have dogs. And I promised that I would take you through what we mean specifically by active and I'll do that now. When we ask what activities that they participate in? Probably not a shocker for a lot of you in the audience, but a lot of them bike. That's the most popular activity for our consumer. It's 60% to tell us that they regularly bike. But what that is, is a good vote of confidence in the continued investments in our champion categories that Mattias talked about earlier in bike carriers, but also an indication of the opportunity that we have to build more on the bike and around the bike, that we'll talk about a little bit later. But bike is the most popular activity for our consumer. If we move on to the next most popular, hiking. This, again, not a big surprise. This is probably the lowest barrier to entry of any outdoor activity. But it is a good, again, indicator for us and reason why we are still offering technical backpacks and hydration packs to support what we know our consumer is doing in the outdoors. And where it gets really interesting, there's a tie for the third most popular activity, and it's between running, and camping and RV. Around 40% participation in these areas. And when you think back to the last slide, right, we talked about 2/3 of Thule households have children in the household. And then you see that 40% of our consumers say that they like to run on an active basis. Then that starts to explain what Mattias was showing about why we've been successful in particular, in all-terrain and jogging strollers because when our customers have kids, they want to continue to run. And it's Thule, being with the best product in the market when it comes to all-terrain and jogging strollers that enables them to do that. And so these stats are really a confirmation of why we've been successful in those types of strollers. And then camping and RV. 40%, that's high. If you look at our general population, again, in our largest markets, it's around 20% of people that would tell you that they actively camp or RV. So we're double that. And the reason for that, again, I think if you go back to the family dynamics we talked about in the first slide, when you have kids, when you have dogs, it becomes a lot more cumbersome to bring all that with you on the airplane or to deal with lodging and hotels rather than to just pick up, do some near home vacationing as Mattias mentioned earlier and have room for the kids, the dogs to spread out and run around, right? So when we see these types of family dynamics, we tend to over-index in camping and RV. And that's why we've been so successful, again, in developing a champion in RV awnings and why we continue to invest in some of the tents that a lot of you here in Malmà saw downstairs this morning and all things around the campsite and RV. So those are the 4 most popular activities for the Thule consumer. And then if we look more regional nuances where there's access to winter sports, we do see a high rate of participation as well in ski and snowboard and we just launched actually in October, our latest solution for this, Thule Arcos XL. So it's actually a carrier on the rear of the vehicle that accommodates skis up to 180 centimeters. And that has been very much exceeding our expectations so far. So ski and snowboard again, really strong participation there. And then if we look at North America specifically, we see a hyperactivity for participation in golfing and hunting. We see about 30% there. And that doesn't mean that today, I'm going to tell you we're launching golf bags. But what it does mean is that when we understand this about our consumer, we can tailor our messaging and develop more use cases and develop a wider audience for products in the portfolio. And so the image that you see on the screen here is our Thule Onto rear of car carrier, but now it's shot in a golf context with golf bags and solving a pain point for somebody and showing them how this solution can do so many different things for them. And then as well in North America, with all the shoreline, we see a lot of participation in fishing and water sports as well. And that's why we've invested in the last 12 to 18 months in a completely new fishing rod carrier portfolio to support that market and running some pilots even globally to grow that segment for us as well. So if we say the Thule consumer is active, specifically, this is what we mean, and that's how we use some of this data to inform our decision-making and also our marketing our content. The other thing that we like to look at when we talk to our consumers is what's in their garage, what do they own? How can we own more of that garage? So if you look into the Thule consumer garage, here's what you'll see. If you look at the bikes in that garage, about 1/3 of them own a mountain or a gravel bike. But I think what's really interesting here is what you see in e-bikes. Mattias talked a little bit about this earlier, this trend that bike is the new car. We see it in the data. In Germany, our largest market, half of our consumers already own an e-bike. That's not just a nice-to-know stat. That means a lot for Thule. Because when you have an e-bike, you can carry more. You can go further with less effort. So that is a tailwind for us. We should be able to sell more bike trailers, more child bike seats more bike panniers because it's easier for people to carry that. I can attest to that personally. I have a 4-year-old and a 2-year old. They go to school every day, including the snow day we have here in Malmà today. In the Chariot trailer, uphill, long distance, we would not be able to bring them to go on a bike trailer without an e-bike. It is a game changer for a lot of people. And so that, for us, gives us confidence to continue to develop all these solutions around the bike because of what we see here with our consumer. If you look at motorcycles and scooters, we talked about Quad Lock in the acquisition there and building expertise in this moto space. We have about 1 in 5, 20% of our consumers that own or have access to a motorcycle or scooter. So we feel like with that expertise now having the Quad Lock family as a part of Thule, we're going to be able to hopefully tap into opportunities there in the future. If you look at North America, we talked about participation in fishing and water sports. And so I think, naturally, we do see a higher rate of boat ownership in North America, which is also around 20% of the Thule consumer. And then if we look at the vehicles in their garages. You see a high rate of SUV ownership. That's been stable for some time in North America. But I think in other markets around the world, we've seen SUVs become a larger mix of automotive sales. And again, that's not just a nice-to-know stat. How we apply that to our business is to say, as SUVs get taller, it becomes a little more challenging for some people to get things on and off the vehicle. We've seen a big trend in the last few years from bike carriers, for example, where people are now preferring to take them on the back of the vehicle because it's more convenient and more accessible. And so we see the same sort of thing in cargo carriers. And that's why as a brand we've invested in a lot of these rear-car solutions in the back of the vehicle for accessibility, for convenience and also if you have an electric vehicle, for aerodynamics. So that's how we're really applying these stats and adjusting our portfolios to get ahead of the market. And if you look at truck here in North America, this is a really interesting nuance. We have 1/4 of the Thule consumers in North America that own a pickup truck. And we feel like this is a huge, huge opportunity for us to take a lot of market share, and frankly, to be #1 in recreational truck racks. We will come out with our first new truck bed rack solution in over a decade in about 2 weeks. It will be the fastest install and the easiest height adjustment of any truck bed rack for recreation purposes on the market. And we fully expect in North America that we'll be able to be #1. So when we talk about big in pockets, we talk about being #1, this is an example of where we feel like we can play. And lastly, as a validation of what we talked about on the last slide in RV and camping, we do see ownership or access to RV and camper van, it's about 15%. So that's what's in their garage and how we measure that and how we like to look, how can we own more of that garage and tap into these consumer insights. And so to pull this all together, right, we talked about big in pockets. That's 1 of these 3 areas that you see on this diagram that feeds into our decision-making process and our criteria for these new segments and new products that we want to get into. Do these things align with the Thule brand? Do they align with our core competencies? Can we be #1? We talked also about market trends. You just saw the consumer insights. That also feeds into this decision making. But we can have the potential to be big in pockets. We can have market tailwinds. We can have good consumer insights. We don't have innovative products that can disrupt and differentiate. We still won't be successful. So that's the third arm or leg, whatever you'd like to say on this diagram that's really important. And when we feel like we can tick the box on all 3 of these things, that's when it comes together in terms of new products and new segments that we're looking to pursue for the future or scale in the current portfolio. And I'll come back in a few minutes to give you a specific example of that. But for now, I'm going to hand it back over to Mattias. Thank you.

Thank you very much, Aden. So now we have covered the strategy. We have covered opportunities. What is it that we want to do? Well, our ambition is to scale up profitable organic growth. We've talked before today that the focus is on organic growth, and we have an ambition to do that faster than we've done historically. Now there's a number of things that need to come true for us to achieve this, of course, but there are 3 things that are particularly important that I'd like to cover today. So the first one is our focus on the champion categories. So building bigger and more champion categories. Continuing to innovate or out-innovate in the existing categories that we have to make them even bigger. To add new champions, and the good news is that there are already interesting and promising opportunities within the company today. And then lastly, we will think a bit differently about the bags category and use bags to support the champions that we have in the company. So I'll go into each one of these 3 bullets now because it's important. It is our #1 priority. So starting with building bigger champions. Three areas to remember around our work to build bigger champions. The first one is we need to make sure we continuously innovate and have a portfolio of upgrade new products coming. So we will increase the R&D spend we have for champion categories and spend about 4% of our total sales on champions. Secondly, we will continuously then feed these categories with product news and upgrades, both to drive trade-ups, premiumization, but also news and new niches and use cases that Aden talked about before. And on that note, we believe, and we have proven before, that we can thereby expand the categories. We can address more use cases within each category. We have proven that this year very well with bike carriers and proven it again and again in the champion categories that we have in the company. We also can address more price points. We have, in the recent years, spent quite a lot of our efforts on the premium end, which is, for sure, the most important priority, and that's what we should own. We've done a bit more in mid-segment just this year. And we actually believe we can stretch these price points even more, developing products that are what I call premium plus, but also sort of mid, low, if you like, probably in our terminology entry level, but from a market perspective, more of a mid-price level. We can add more accessories, and we can also address some regional or market-specific opportunities. For example, the North American-specific bike carriers we have developed, that's been successful this spring. So this is how we're thinking about building bigger champions, continuing to out-innovate and grow our existing #1 positions. Now the other part of the focus on champions is to add more champions. And again, the good news is that there are really promising champion candidates, I'll call them, in the company today that we can scale up. And I'd like to cover 3, and I'll spend a little bit of time on this. So there was a question related to this also previously in the last Q&A. But going back to all-terrain and running strollers, a clear niche where we have done really well, have a really strong growth momentum. We are the global #1. There is market growth from sporty parents wanting to continue to run and be active even when they become a parent. We also see really good reception in terms of innovation here. When we bring something new up -- new out, sorry, upgraded, innovative, we see clearly the consumer responding. And we have a really good growth momentum. We will continue to put fuel to this fire and grow this part of our business. The 2 other candidates I'd like to mention are the organic entries we did in 2024, so last year. And in the beginning of last year, in the first quarter, we entered the dog transportation space with the dog crate Thule Allax. Again, it's a clear pocket, no global players. Aden just explained some statistics around how many Thule consumers today own dogs. So for sure, there is a connection with us as a brand already. Pet market is growing. Pet safety is growing even more. And this was last year, the best new category measured by first-year sales in Thule's history. Award winning products from several institutes, including the 2 most prestigious ones. So off to a good start and something we also will focus on scaling up with more products launched this year, more to come and widening the distribution. And the third candidate is car seats, which also launched last year. First products came to market in 3 countries, end of May and then the gradual rollout during the second half of 2024. This is a bit different. This is actually a competitive and quite big market. But there are few players that really focus on the premium end and the child safety focus end, which we are really doing. And we are convinced we can build a strong market position within the European premium car seat segment, and we have had a very good start to that work. You may remember that we not only won design awards. We won the most important consumer test, the ADAC test with our first product last year, and again with our second product this year. So clearly proving we are here to be able to make successful products and to win in the marketplace. Also here, there are promising trends or good trends, I would say, with the focus on child safety, both from a regulatory perspective and from a parent and consumer awareness perspective. Not the least, the real world facing in car travel with infants. Looking at the first full year sales for car seat, this is now the new best category measured by first-year sales. So another promising start also commercially and another candidate that we will continue to scale up. Some of you have seen the most recent product downstairs today that will be launched next year. So in addition to these 3 existing candidates, we, of course, have a few more things in the works. We have plans to develop more categories organically. There is work going on. You will not see a new product category in 2026. You may see the new category in 2027. And if not, you'll likely see it in 2028. As with innovation work, it's ready when we're fully satisfied, but there are some things going on. And in addition to that, we support this work of adding and building more champions with add-on M&A. There is about 25 companies today in the world that we talk actively to on a regular basis that could either add to an existing champion or potentially become a new one. But -- and if the time and conditions and several other things are right, we would, of course, be interested in using that route as well to continue to add more champions. So the first priority is building bigger and more champions. And from a strategic point of view, our ambition is to grow the number of champions from the currently 6 that we have today to 10 by 2035. I mentioned before as a third bullet point that we also are thinking differently about bags going forward. So let me say something around that. Bags is a category where we have historically not been growing in total. It's been flat across the last decade. For sure, there are some things within the bags category done well, Thule-branded products that have developed well and some other things we've actively stopped investing in and, therefore, phased out. But even so, we think there is an opportunity to do much more and actually to stop doing some things within bags. So going forward, we will focus particularly on 3 things within the bags category. We will continue to put focus on Thule outdoor lifestyle luggage and backpacks that we call it, core Thule collections that really do well and connect with our consumer. And we have some examples here. I think this is a good one. With the Thule Chasm duffel bag that has performed really well for us and continue to grow for us in -- also this year. The second part is also within bags, there are interesting, attractive pockets or niches. We already today have a really strong offer and are #1 in, for example, bags for transporting your skis or your ski boots or surf bags or your bike when you take it on the plane or on a train. And to Aden's point previously, we see a lot of opportunities around bike commuting. So in a few seconds, Aden will be back and show you an example of an interesting pocket that we're resting now in 2026 through -- within the bags category. And the last point around bags is we will also use bags to be accessories to support other champions. If you have a rooftop box, you might want to pack that in an efficient way. Or if you have a stroller, you probably have a few things you want to bring with you as you are taking your stroller out. And we are developing more accessories like packing cubes that has done really well for us. And also launching next year is what we call the Thule gear haulers that can be used to bring your things in an RV or in the back of a car or in a rooftop box or on a boat, et cetera. So bags will have a role also as functional accessories to support other Thule champions. Now there are also a few things that we will do less of. We will reduce our focus on things that haven't done so well. We will stop doing developments for consumer electronics. So laptop backpacks, sleeves, cameras, things even. Business travel will not be a segment where we focus more on and the secondary brand, Case Logic and OE product will, for all practical purposes, be out of the portfolio within 2 years. So having said that, I'd like to welcome Aden back to give an example of an interesting niche within the bags category that we would like to focus on going forward.

Great. Thank you, Mattias. So if we look, this diagram looks familiar, right? We looked at this a few minutes ago, really our guiding principles on how we look at new opportunities. And so I'm going to take you through one of those now in the bike commuting space. This is a new product called Thule InLock. Some of you may have seen it downstairs earlier. But I'm going to take you through the logic as to why we've decided to do this and why we see it as a really high potential product for us. If we look at big in pockets, what we're talking about here right now are bike panniers. We're not talking about a broad bag segment. We're not talking about bike bags. We are talking about a niche with a limited number of competitors out there, Thule already being, I would say, top 3 in this space on on-bike pannier bags. And some of you may not know what a non-bike pannier bag is. So I have one here just to show you briefly what that means, right? So this is a typical on-bike pannier bag. These bags have hardware mounted on to the rear of the bag, and this allows you to securely mount these bags to your bicycle for when you go to bike either commuting or recreationally. So that's what a typical bike pannier bag would look like today. Now I talked about this being a candidate for big in pockets. It's also very much brand aligned. You saw the consumer insights earlier. You saw the market trends. And so we know that we have a consumer that bikes and we know we have a consumer that owns bikes. So very much brand aligned and also very aligned with our core competencies at Thule in R&D and supply chain and sales channels and marketing channels that we're already in. So on this one, when we talk about the big in pockets philosophy and can we be #1 here in bike panniers? Absolutely, we think we can. If we look then at the second leg here, the trends in consumer insights. If you look at the market trends around bike commuting, you'll find, number one, government investment in bike infrastructure to encourage commuting is skyrocketing. In Europe, they're expected to spend 30% more in the next 5 years on bike commuting infrastructure than has been spent in the previous 5. If you also look at government incentives, trying to encourage people to bike commute, you'll find a lot of new programs. In the U.K., for example, you can now pay pretax out of your paycheck in a lot of places for bicycles. In the Netherlands, your employer can provide it as a benefit in kind. So between government infrastructure investments and government tax incentives, there's a lot of tailwinds behind getting people on bikes and commuting on bikes. And then we talked about the general trend in e-bikes. So in Germany last year, 2 million e-bikes were sold, 1.8 million conventional bikes were sold. And so I talked earlier about e-bikes and being that game changer to enable people to commute an easier way. So clear market trends in favor of bike commuting to support this. And we talked a bit about the consumer insights earlier and the fact that we know in Germany, our biggest market and in others, there's a high rate of ownership already with our Thule consumer base. But we also asked them in our largest market, Germany, how do you commute to work in school? 40% of them use a bike either as their primary or secondary method for those commutes. So we know from our consumer insights that people are already doing this, and we feel like we can tap into it in a bigger way. So we've got supportive market trends. We've got supportive consumer insights. We've got something that we can be big in pockets. But again, as I said earlier, without innovation, we still won't win. So can we disrupt? Can we differentiate? Can we command a premium position in this bike pannier space? Absolutely. Yes, we can. It's an innovation-based culture. Mattias said it. It's our superpower. And so I'm going to take you through how we're going to do that and what this product does. When we talk to consumers, when we do our market research, we look at what are those pain points, what is the biggest pain point with that pannier that I just showed you. What consumers tell us is it's off bike portability and comfort and ease or difficulty of mounting and dismounting the bags on the bike. And so you see why that is, right? There's all of this cumbersome heavy hardware on the back of the bag. And when you try and take it off the bike and take it with you, it's very uncomfortable, digs into your shoulders. It's a real pain point. Sometimes, the most beautiful solutions are in their simplicity. And so that's what we've developed with this Thule InLock system. And to make it easy to understand, we took the hardware off the panniers. I'll show you what that looks like here. This is our Thule InLock pannier. There's just a side panel now that you can see in the photo here that mounts onto the bike and bag comes off and on that side panel. So for those of you here today that traveled with your carry-on and you had a backpack or a laptop sleeve, and you put that over the handle on your carry-on bag. That's exactly how this functions. Super simple, game changer, in my opinion. We've solved the biggest customer pain point. It's differentiating. It's disrupting and we've got patents pending to protect it. So right, big in pockets, yes. Market trends, positive. Consumer insights, positive. Innovation, absolutely. And so all those things come together, and that is what really directed our decision to make a big deal out of this product. We feel like this can be a game changer in the market and that we can be #1 in bike panniers with this solution. Before I hand it back to Mattias, we're going to show you just a brief video of what this looks like in action. Thank you. [Presentation]

So we talked about the first priority, building bigger and more champion categories. The second priority to scale up profitable organic growth is to do what I call reach a bigger audience or, in other words, sell more of what we have. We are fortunate to work with a fantastic brand. Thule is really well known for quality, connection to the outdoors, safety, reliability, durability, ease of use, design. There's a lot of good things. And it's also a brand that has high brand awareness. But it's interesting that very few of our own consumers are aware of large parts of our offer today. In our biggest market in Germany, 2/3 of our own consumers don't know that we sell bags. So there is, for sure, an opportunity to introduce consumers to more of the Thule offer, in other words, reach a bigger audience and sell more. So we are working on that through many different activities, and I'd like to just show you a little bit of what we do. Two things that we have done more of lately is events. If it is bike events in California, arranging a stroller-running event before one of the European -- Europe's biggest running events, the Adidas 10-K, high-end surfing events in Portugal with Big Wave Surfers or dog walks in Stockholm around the Thule store. Getting out there, showing the product in real life and engaging with consumers has been a good lever for us to pull. And secondly, another and cost-efficient way for us has been to step up our work in PR, where we work with some of the best media in the world and increasingly telling the story about all of Thule or more of Thule rather than just one single product. Now there are also more concrete things we can do on specific geographies and channels. And I mentioned before that, for example, we have a new setup for sales and marketing in North America this year. We've actually just recently changed our setup in Australia. As of 1st of November, we now have our own team in Australia, not an enormous market, but a very good outdoor market where we clearly can grow. And then there is a lot of things that we are doing around D2C and thule.com on the digital side, just opening thule.com for consumers in more markets and they're now starting to engage more digitally, and we could have probably an own Capital Markets Day just during that topic. Lastly, for sure, there are some specific things we're also doing to address consumer segments and channels to make sure we build up our newest product categories. But these have been good for us. And we actually just last week, had the biggest customer and media event we've ever had at Thule. And instead of traveling to trade shows and meeting customers out there, it's more cost efficient, if we can, to be -- to bring people to us. So we were here in Malmà talking to a lot of good people around Thule, our new products, of course, but again, introducing more of our full offer to these partners. And it looked a little something like this. [Presentation]

The third priority for us is more around how I can obviously not do this alone, and neither can Aden and Toby and Catharina and I together. We need a strong team. And I have spent 2 years building what I think is a super team, a top team of what we call accountable leaders that will drive these results. So let me spend a few moments and describe that. And what we really try to do is to build a team and an organization that can scale in a simple structure and an efficient structure. So we are decentralizing what we think can be decentralized, sales responsibilities to regions and channels, category responsibilities to category specialty teams, but actually centralizing even further things where we can get scale on global investments like R&D and supply chain. And we have been working quite a lot also on how to empower those teams, clarifying responsibilities and accountabilities and making sure that the organization structure works in total. Now that's all good, nice structure, but you need strong people, and we've spent a lot of time on actively talent managing and built what I call an A team of high performers. And if you look at the top 75 people we have in the company today, which is a wider definition of the leadership structure in the company, starting with the group management team, you can see in the bubbles to the right-hand side, we have over 80 years of experience on the group management team. Looking at the top 75, sorry, 18% of those are internal promotions that got promoted within the last 2 years. And a similar number, 22% are external recruitments that we brought into the company in the last 2 years. So I feel really good that we have put both a structure in place that can scale and really great people involved that can drive this business. And then lastly and very importantly, we're also working very actively with our fantastic Thule culture or what we call sometimes in Swedish, GnosjÃandan and we do have an amazing culture here at Thule. I really believe we have this entrepreneurial spirit. They can do attitude. We're always looking to improve things, and we play to win, and we want to win as a team. And that's something we have done quite a lot of work with to make sure we stay current and that's an important part of our recruitment and promoting, et cetera, of people. So now I've talked about the 3 main priorities for achieving the ambition of scaling up. But I'd like to mention something else as well on top of this, something which is always important to us at Thule, and I've expressed it before us strengthening the foundation. But there are 3 things we just believe in that I want you to remember also. First of all, we believe in Swedish engineering. We believe we have strong engineering capabilities not just in the country, but within Thule and that we can actually bring a lot of great people to Hillerstorp and to build a strong base for product development going forward here locally. We are continuing to extend the facilities in Hillerstorp. It will be ready in 2026, and we have long-term plans in place. We have today about 270 engineers in the global test and R&D center. And it's interesting and encouraging to see we attract people from all over the world. Between Hillerstorp and this site here in MalmÃ, we have employees representing 24 different nationalities. So that's something we believe in. Secondly, we always work on cost efficiency. I think it goes back to the SmsÃ¥land's cassinette, the mindset or the culture that we have at Thule. Yes, I'm biased. I am from SmÃ¥land, but still, this year, we've also done a few things to push the efforts a bit further. We will come back more to this in the next chapter, but we are investing in automating our DC in Poland, to optimize manufacturing capacity and to continue to drive continuous improvement efforts. And lastly, what we also believe in is around sustainability and integrating sustainability into what we do, and that could also be an own session at some point. But the one thing that I'd like to mention, which I think separates us from some others is that we integrate sustainability in the way we design and develop products. So for example, our newest bike carriers that came out have a higher content of recycled aluminum, green aluminum produced with greener energy sources and, in total, have a CO2 footprint, which is 50% lower than the previous generation. Again much more to say on this, but I want to make sure that we address these points around a strong continuous foundation as well before we move forward. So in all, scaling up profitably and growth is our ambition. Building bigger and more champion categories, reaching a bigger audience and having a top team of accountable leaders will be the 3 keys to get there. And I mentioned before that our strategic growth ambition is to go from 6 product categories that are champions today to 10 by 2035, and that ties in really nicely to the organic growth target of growing 7% per year. And that concludes the presentation part of this third chapter. And with that, I'd like to invite my colleagues up again on stage for a Q&A session.

So you talked about keeping on innovating in the current champions, but I mean how many rooftop boxes and bike carriers can you really launch? Is there much more to do?

Absolutely, there's much more to do. And I think for those of you here in Malmà office today, you saw some of that down in the lobby. I think it's a great question. We've been making bike carriers for decades. What you saw downstairs that's going to launch this year is, again, solving a customer pain point the Thule Epos ParkSecure, where we've introduced parking sensors. That's the hardest part when you've got 3 bikes behind your vehicle to understand if you're going to hit something behind you and damage your bikes. And so again, we're continuing to innovate there. And the other thing I would say, talking bike carriers that you see in the same carrier is the new bike arm that we've developed. We've seen a very much evolving market in terms of bike geometries and the diversity and bike geometries out there that we've had to address with new technology and new patents, and we've done that. So yes, things like bike carriers or roof boxes can seem a bit static, but there's always evolution in the market, and there's always opportunity to innovate. And same goes for sustainability to your point earlier, Mattias.

Should we continue with questions from the audience.

My name is Johan Eliason at SEB 1. I was just curious about your comment about the OE brands and Case Logic. How big percentage of your sales today is the Thule brand and if you adjust for Quad Lock, I guess, right now, but...

Well, in total, the Thule brand accounts for the vast majority of our sales. It's published in our quarterly and annual reports, but I don't have the number now off the top of my head. But within the bags category, you have seen a clear shift over time where we once several years ago used to be -- have a higher share of the Case Logic brand and some OE product, and that's declined quite rapidly, whereas the Thule brand has grown to a split, which is now Toby, do you remember?

It's more than -- significantly more than 50%.

More than 50% Thule branded within bags.

And then this potential headwind, you talked about closing them down over 2 years and still targeting 7% growth per annum. Are we talking about 1 percentage point or what?

Yes. So I'll actually come back in the next chapter on how that mathematical equation works. But for sure, within bags, we will and we have for years, declined the Case Logic business and the OE business. And we believe we can grow the Thule brand business faster with the new focus on some interesting bags opportunities that we went through earlier.

Carl here again with DNB Carnegie. So 2 questions from my side. First, on the R&D spend in the champions. You talked about going up to 4%. And I believe you had that pretty short, I believe you were around 2.5% now. That seems to have been fairly consistent over time. So is that going to be on expense of the, let's say, nonchampion categories? Or is it going to be an incremental 1.5 percentage point step up.

Yes. So we've been at, if I remember the chart right, around 3%, 3.5% or so, we can all look at it together later historically, to your point, Carl. And we will make sure that's around 4% to capture the opportunities we see. We will spend less on other things. So we will spend more of the R&D -- higher share of the R&D spend on the champions and on what we call the next champion candidate or the next-generation champions. And we will reduce in other areas. And in the next chapter, when we talk specifically about the path to financial targets, we will also talk more about the R&D spend and how that will evolve in total.

And that takes to my next question because you talked about going from 6 to 10 champions. And I believe also from the previous chart, you were going from, let's say, 4 to 6 in the last 10 years. And you said now until 2035 and champion qualifications seem to be quite high standard. You're talking clear #1 high market share go forth. So maybe a little bit on the phasing of the 2035 is going to be pushing it hard now initially to reaching the scale, or how many can you add per, let's say, over 5 years? Is that going to be achieved by 2030 and then you're going more to profitability mode? Or -- yes.

Yes. No, good question. So we've had 5 champions since the IPO, and we've added a sixth one now with Quad Lock. To your point, it is a fairly high bar to get there, a clear -- small pocket, clear #1, high market share. We talk internally about sort of SEK 500 million turnover for us as being a bar to meet. I think the good news -- the good starting point is there are 3 things we've already launched that we can scale up. And then we again have some more things in the works and potentially in other M&A if the right opportunity comes could be helpful. But we are not thinking about the future in terms of sort of an investment phase and the profitability phase. We're thinking about a balanced approach to this, where we continue -- or sort of in parallel will drive continuous product development and continuous growth efforts, but focused on champions and the next-generation champions and efficiency gains to improve both the sales trend and the profitability trend at the same time.

I'll do online question in between. So we got a question about the common strollers are not classified as champions in this presentation. But car seats quite often connect to the strollers. So how do you see that? Could that actually help our position in the common stroller area as well?

I'll take that one?

Sure.

Yes, absolutely, again. I think that was part of the initial philosophy around why we decided to get into car seats here because a lot of first-time parents, they're buying a full travel system. And so they want to see if they're buying a stroller, they're going to use every day that they've got a car seat and a bassinet that really cleanly integrates into that whole system. So the philosophy and the thinking from our end is that by extending the kids portfolio by offering these premium car seats really focused on safety, is that by extension, we'll get more customers spending more on all the products around that with the strollers, bassinets and accessories. So absolutely. Yes.

Yes. It's Agnieszka at Nordea again. So you mentioned that apart from the kind of organic development, you will also look for champions through acquisitions. Should we read it that all the M&As that you will make will be really to fill up the gaps in terms of product and technology rather than expanding geographically or buying some kind of distribution power. And also when it comes to the '25 targets that you mentioned, could you give us some flavor about the size of the targets or geographies? .

No, a good question. And to the first part of your question, if I recall correctly, the answer is yes. We are a product company, and we are investing according to sort of the product access primarily. And that goes that the work -- the M&A work going on is also mainly focused on adding either product for specific subcategories that fit our existing champions or potentially could become new ones. So it's a product lens first and foremost, to your point. Sorry, Agnieszka, what was the second part of your question?

Size of the targets or geographies.

Right. So we -- obviously, for some of the potential acquisitions that are add-ons to existing champions, they are fairly small. Some of the larger ones that could potentially be new champions or a bit larger. I mean Quad Lock was unusually large for us. There is no secret about that. But Toby will also come back later when we talk about financial targets about how we prioritize our capital, how we think about capital allocation. I think you maybe add some more insights to this. And we are clear also in our communication of targets that organic growth is the primary focus for the company.

So how should we think about growth coming from acquisitions?

Well, I think on the note of the last answer, we are primarily focusing on organic growth. But we have seen throughout history, how we can benefit from quickly getting into champion positions through an acquisition. So we're not excluding that. But again, I think after some further presentations around capital allocations, you will have a better understanding for how we prioritize, but the main focus is organic growth.

Any more questions from the audience? Yes, we have Daniel here.

Again Daniel Schmidt from Danske. Yes, maybe one more. And I think you told us a bit about the total addressable market on car seats and dog crates before. It's changed maybe a little bit on car seats, given that the U.S. is delayed and so on. And then we have maybe 2 unknown. And maybe you know, of course, where you want to be, but how does those sort of potential champions stack up in terms of addressable market versus the ones that you feel that you're already champions in.

So most of the markets we're champions in have a market size of SEK 2 billion to SEK 5 billion globally. There are some exceptions, but most of them, at least in the premium end where we play. And if you look at the candidates that we have, I mean, all-terrain and running stroller is about a SEK 1 billion market today, growing also, fueled by products like ours. Dog transportation is about a SEK 2 billion market. To your point, car seats is a bigger market, but that premium end in Europe is not enormous. It's probably around SEK 8 billion or SEK 10 billion or so. So it's back to the original point actually that these are fairly -- these are pockets that are not enormous, but where we can win and be #1 and continue to grow them ourselves through product innovation and developing. That's where we perform the best.

I'm just thinking that maybe 2 of them are a bit smaller. And do you think that's compensated by being a much, much more fragmented market than roof boxes or bike carriers, i.e., is it a bigger opportunity that gain more market share than what you have in your bigger champion markets?

Let me just make sure I understand the question. Is it more opportunities in the existing categories you're saying?

No, rather than new ones, 2 of them are quite small. And in order to compensate for the size, are they more -- even more fragmented, i.e., competitionless than what you see in your legacy champion markets?

Good question. I have to run all the categories in my head. But if we look at the new ones, look, in dog transportation, there is no global player. There's few strong players. There is a lot of not very advanced solution out there, so very fragmented, right, and really clear opportunity for us. Same goes for the active strollers, if you call them that. But also part of the story and part of the fact we've been showing is when we have the ability to grow these segments through product development and product innovation, and I think it ties in really well with the focus on organic growth. If we continue to invest in growing these categories and then have some that we grow faster in and penetrate more and build up new champions in that will enable us to get to the at least 7% organic growth.

Adela Dashian from Jefferies. This might be a confusing question. But when you think of acquisitions and how you approach them, do you start off by looking at product categories to go after? Or is it the brand that matters the most?

For sure, the first. So we take a product lens as #1. What's an attractive category? Is there a tailwind? Can we innovate in this space better than everybody else? Or do we believe this target can and that would fit sort of with us? And then we actually want to run, as you may know, a mono brand strategy. So everything we do should be eventually fit with the Thule brand. Historically, what we've done this via co-branded or as we call it. So the original Chariot product, for example, is called Thule Chariot today. So for sure, product lens first.

And maybe also on your direct-to-consumer strategy, is it possible to expand a bit about what the ambitions are there? .

Yes, for sure. So a couple of things. Sort of strategically, we think it's great for many reasons. We want to grow all our channels, of course, so we don't grow at the expense of our partners. But having a direct connection with the consumers allows us to introduce more products to them, to learn more about what they want and to have a deeper relationship as a brand. Before the Quad Lock acquisition, to keep the numbers easy, we were about 7% of our sales as DTC, and we think we can double that within a couple of years. So the first step in that journey has been just simply to enable DTC shopping in more countries. I think we had 8 or 9 countries open for shopping at thule.com 2 years ago and now we have 17 or 18 or so. Australia will open in Q1 next year. So step by step, we are building a bigger digital footprint, getting more engaged consumers and yes, seeing the value out of that.

And you still think you have the right infrastructure in place to pursue this? Or will there be additional costs associated with this?

No, it's a good point that we've discussed sometimes before. And that's a fortunate situation with Thule. I mean, I've done a lot of e-commerce models over the years, but the heavy investments are in IT and in supply chain structures. On the IT side, we have, of course, you always upgrade, et cetera. But the supply chain setup at Thule is what I would call retail-like. So we typically supply our customers frequently. You can -- if you're a bike shop in Germany, you could probably order a product on the Monday and get it on the Tuesday or latest, the Wednesday. So we're used to sending small orders in high frequencies across the world, and that's a very good fit with the DTC business. So it's actually not been very costly at all to add these kind of services to the supply chain structure that we have.

So a final question before the break. We are selling car seats in Europe, but the dog transportation we are selling all over the world. So how does this dog transportation marketing and selling, how is that different between, for example, Europe or North America or other regions?

Sure. Happy to take that one. It's very different, actually. If you look to the European market, a lot of the purchasing and the motivation for dog safety solutions is built around regulations. In Italy, in Spain, in Germany, in the U.K., all of these countries have laws and regulations that say the dog needs to be restrained when you're driving with it in the vehicle. And so that's a motivator for people to comply with those regulations, avoid fines and it's also the right thing to do. But that's the motivator in the European market. And that's why we piloted the dog products here first because we felt like there was that strong motivation to purchase locally. But we knew we had a winner quickly after we started piloting it here and rolled it out later in the year in the North America market. And it's a very different motivation there because you don't have those laws and regulations that are mandating dogs to be restrained in the vehicle. And so we need to build that market. We need to build that awareness and tailor the marketing and the messaging approach locally there, which we've done. And if you think about it, right, a personal experience as a kid, 30, 40 years ago, I used to ride in the front seat between my parents and my grandparents. No booster seat, nothing. And look how the child safety market has evolved over the last couple of decades. And so that's what we see here that we would anticipate it's going to happen with dog safety because there's a whole trend around pet humanization. People are spending a lot on their pets. They're a part of the family and they want to protect those pets and invest in that. So we see the same evolution coming in the next couple of decades here under dog safety. And so we want to be at the forefront of that and really lead it and be the ones building the market. And I think we've been pleasantly surprised in North America actually with the results that we've had. They've exceeded expectations, and there's a consumer there that has the appetite for this. And last thing really to add is we've positioned it, not just around dog safety but actually safety for the passengers in the vehicle. So it's all about protecting passengers and dogs because in an accident, the dog can become a flying projectile, and that's harmful for all the passengers around the dog. So that's the message we're trying to deliver. Different ways in different markets depending on the consumer motivations, but great question.

Thank you, Aden and Mattias. It's time to refresh and refuel. And this time, we'll have a 15-minute break. So see you back soon. [Break]

Okay. Welcome back, everybody. Now we're going to start the fourth and final section, and we're going to talk a little bit about the path to reaching our financial targets. And in case anyone has missed it, we have new financial targets today. And here are the financial targets. Firstly, we have 7% organic growth, 20% EBIT margin and 75% dividend payout ratio. And we believe we have a clear path to reach these financial targets, and that's not just because we've set new financial targets for the company and for management, it's because we've worked through a through plan on how we think we can take ourselves and take Thule through these targets. So we have a clear plan behind this, and we're going to take you through that. In order to do that, we're going to take you through 4 areas and drill down on these 4 areas. So firstly, we're going to take you through our consistent sales growth and the sales target, going to take you through our strong and stable EBIT margin and the EBIT margin target. We're going to touch on conservative leverage and, finally, the high dividend payout ratio. So we're going to drill down on each of these areas. And for the first one, when it comes to sales growth, I'm actually going to hand back to Mattias to take you through some of the background to sales growth. So...

Thank you, Toby. I'll cover the growth part, and then Toby will be back to cover the remaining three areas. So just a quick reminder. This is the same graph that we've showed at the beginning of this presentation. We've had a pretty consistent sales growth pattern, excluding the COVID effects for 10 years, 5% annual growth on average and actually 5% also over the last 5 years. So it's a good benchmark. But as you've heard right now, our target is to increase that to 7%. It's just not 7% across the board, though. There are a lot of differences in terms of categories, market situations, and also initiatives from our side. So I will take you through that to some detail actually. But before I go in too much detail, I'd like to give you an overview. I mentioned before, and some many of you know, that we report four product categories at the highest level. The two on the left-hand side here, Sport and Cargo Carriers and RV products, together account for 70% of our sales. And we have four of the six champion categories that we have are within these two, three in Sport & Cargo Carriers and one in RV Products. Ands here, our ambition is to perform in line with history. We have grown these categories for many, many years, and we have an ambition to continue to do so also going forward. Now on the right-hand side of the graph, the other two product categories at the highest level, Active with Kids & Dogs and Bags & Mounts, represent 30% of our sales. We don't have as many champions today, but we made a lot of investments into these categories over recent years. And here, we expect faster growth. Here we expect to scale up and build the next generation of champions. I'll now take you through the situation and the plans and actually the market dynamics for each one of these four main product categories. Starting with Sport & Cargo Carriers, our ambition is to extend the global #1 positions that we have. We have champions and global market leaderships in roof racks, cargo boxes, and in bike carriers. And there are several good trends here that will support us that gives us tailwind. Now we have an increased adoption of electric vehicles. That changes how you transport things on and around your car. Fewer people want to have things on top of the car because it reduces range. And therefore, things move to the back of the car, a growth opportunity for Thule, which we are investing against. We talked about e-bikes today a few times, also opportunities for Thule to innovate, heavier bikes, proliferation of bikes, more opportunities to create bike carriers for more types of bikes, including e-bikes. And we have covered the trends around near-home vacationing, and there is actually underlying very positive trends or solid trends, I should probably rather say, within both winter sports and water sports. So good tailwind trends to support us. There are also some specific subcategories or niches that we can build a new presence in within this space. So we have already a strong portfolio, of course, for bike carriers behind the car, several years ago, used to be on top of the car. And as Aden mentioned as an example before, we are investing to build similar products for the equivalent of rooftop boxes behind the car, introducing some things, two new products in the last two years. It is growing really well for us, and one of them is represented on this photo here. And the other really interesting area we're investing in right now is around pickup trucks, where we have the next-generation product coming out in just a couple of weeks. This is also, as it represents our biggest footprint, over half of the sales, for sure, a category that will be supported from having what we call a bigger consumer audience. Focused sales and marketing team in North America. We've just forward integrated or stepped in ourselves in Australia, and this will help us give scale and, of course, drive growth in this product category. Now looking at the market trends here, and we've had some questions and discussions around that already today. This has been a solid market development over time, around the sort of GDP plus market growth of 2% to 4%, depending a little bit on the niche and the geography you're looking at. This year, the picture is different. Europe, to the best of our estimates, is more stable, probably around stable, maybe somewhat negative. We'll see where the year ends up. But in Europe, to the question -- sorry, in the North American market, in the U.S. to the question we had earlier, we've seen a really shrinking market, and our channel partner tell us it's probably at least a double-digit decline. So clearly challenging. But given the consumer sentiment will turn and the positive tailwind trends that we see from the long-term favorable factors, we -- there is no reason to believe that we will not get back to the same 2% to 4% market growth in the midterm, which will be supporting us with our ambition of growing this at 5% or more over time. The second product category is RV products. And we have, for many years, grown the Thule RV product business faster than the RV market, RV registrations, or other metrics for how to measure the size of the RV market. And that is our goal also going forward, to continue to outpace the European RV market. We have a really strong position in earnings. European market leader, clearly, and in bike carriers for RV products, for RVs, for motor homes, and for caravans. That is our main focus also going forward. Here, there are positive market dynamics, which connect to the near-home vacationing, the camping trends that are still around, the consumers' appetite for having flexible and more sort of freedom in their travel. And we Additionally, in Thule have some additional support from the trend that motor home vehicles are getting smaller. So If you're looking at the growth in the RV market, most of the growth is coming from what's today called urban vans or sports vans, which means that, that's really good, but you need to have other solutions over time to bring more of your gear, and we can see innovation opportunities in this space and develop even more products. On top of the European market, that is our main focus, we will address certain premium niches in both North America and the Asia Pacific region, and there are more opportunities there. We will also expand the product portfolio a bit. There are what we call around-the-van solutions. And one good example of that, that we've been successful with recently, is what we call panels. On the picture, you see that there are some 10 panels connected to the owning, a great additional product that helps you protect you from the weather conditions, whether it's sunshine or rain. So there are more opportunities to connect to this portfolio that we already have. Here, there's a bit of a different market dynamic. Historically, this has grown a bit faster, not much, but somewhat faster than the Sport & Cargo Carrier market, but 3% to 5% and this year, yes, we are seeing a decline in the market, just like we did last year with an RV. But here, there is a light in the tunnel. A lot of the challenges this year is to stock levels and stock level effects. So the RV market is typically best described in two channels, the OE or the manufacturers and the aftermarket, the dealers. And this year, we have seen that the aftermarket has returned to growth in terms of market vehicles sold registered, but also for us at Thule. However, there's been too much stock in the supply chain. So the OE side has taken production stops and really lowered volumes in order for the stock situation to normalize before ramping up production levels again. And that, of course, impacts us as well. So here, we see a positive sign of the market returning to growth. And step-by-step, fewer and fewer OE production stops helping the overall growth in the market. So also here, particularly given the positive trends, there is no reason to believe that we will not have a good midterm market growth again that will support our ambition to grow at 5% or more in the RV product space. The third product category is one of the categories where we have higher ambitions. And here, a lot of things have happened over the last just two years. Today, we have a one strong champion here. We have the multisport and bike trailers. That actually taps in very well to the bike commuting trend we talked about before, and that can be combined with several other products we have here like child seats -- child bike seats to tap into that trend even more. And this will continue to grow. We are convinced that the bike is the new car as we talked about several times today, and the continued shift to e-bikes and investments in bike infrastructure will support that. Now that's one side, but there's also a lot of new things that have happened here. And here is where we see opportunities in the near term to scale up some of these up-and-coming champion candidates that we have. We've talked about dog transportation being one, where we will continue to invest in both new products to widen the portfolio, but also in presence, reaching more market and building consumer awareness over time. We have talked about the all-terrain and running strollers, where we have a really strong growth trend, and we will continue to invest more in that space, both in terms of product and distribution to grow that even more going forward. And we've also talked about our ambition to be European #1 in premium car seats. Again, these latter categories that we recently have entered are supported for -- from positive trends towards safety, both for kids and for pets. So a bit more arrows here to explain the market dynamics. But also here historically, for our footprint, which has been mainly then of the champions, good market growth, challenging this year, not the least because of the retail environment in these categories around juvenile and bike retailers. But we expect the market, of course, to return to growth, actually probably a bit less on kids in the next couple of years as birth rates have declined and that impacts the number a bit. But through to the other favorable trends, we do expect the market to come back to a good growth. But more importantly, maybe or at least additionally, we do expect the good market trend in dogs. Dog accessories, in general, have grown about 5% per year globally in the last few years, and the safety-related products a bit more. So here, we have positioned Thule towards an attractive tailwind, hopefully, going forward. And here, we expect fast growth. Our growth ambition here is to grow by 15%. That is, of course, quite ambitious. And just as a positive signal here, we see that despite the challenges in the consumer market this year and particularly also in these categories on the retail landscape, looking just at our own channels are thule.com and our own stores, we are growing well into double digits, actually 20% plus this year already. So we hope and expect that as the market normalizes, we can get that effect in a wider footprint and continue to invest, of course, and grow this by 15% per year. And the last main product category that we have is Bags & Mounts. This is a story with two different sides or two stories under one product category rather. We have strong momentum in performance phone mounts, and we are reworking the bags category, as we talked about before. So we will continue to invest in the global performance phone mounts for sure, on product development. This is Thule, that's what we do, but also building market awareness for this product. There is still a lot of untapped potential to bring this out to many consumers around the world. There is good tailwinds here just from generally people being more active and being, of course, more participating in more types of outdoor activities, but people are also using their phone or their smartphone for more things. And the number of apps being developed for running, biking, and all kinds of different activities is one example of how phones get integrated into outdoor lives. So good trends also supporting the category. We've talked particularly around bags before, so I'll go quick here. But just to recap, we will focus the bags category on attractive outdoor niches and bags and accessories and the Thule collections around the Thule outdoor lifestyle luggage and backpacks as we call it. We will, at the same time, reduce the bags footprints in consumer electronics and particularly the secondary brand, Case Logic and OE. So here, we have historically had in the bags business, a low single-digit growth. I think a good example here, if there is a public -- public listed company called Samsonite Group, which is the market leader. You can follow their sales numbers, of course, and they typically also report market statistics. If you look at the Samsonite Group's development this year, they're minus 4% for the first 3 quarters of the year, which also is in line with our view about similarly how the market is down this year. Phone mounts, on the other hand, market has historically grown around 10% per year, so very strong, and we see a similar trend this year. We expect, like others in the industry, the bags to come back to historical levels of around 1% to 3%, but we expect also mounts to continue to grow fast as a category for the coming years at around the double-digit market growth. Again, a beneficial trend supporting our future growth ambitions. So the organic ambition here is actually also high. But given that we are reworking bags, that has a negative effect in the shorter term. So the midterm growth ambition here in all is 10% per year. And we're not waiting around. We're already acting to start working in this direction. A lot of things are already ongoing, as you've heard. And we are launching products also next year, and we have made sure that we address the strategic priorities with our product pipeline in 2026. So I will not go through all these new products that are about to come. You have seen some of them today, but I can mention this. We are focusing on growing our #1 positions, our champion product categories. We are investing in building out the next-generation champions, and we are reworking bags to focus on outdoor and functional accessories. Now it wouldn't be a Thule presentation unless I showed at least a little bit about some examples of coming products. So I can't help myself, so you have to hang on. But we have mentioned Thule Xscape today, which is coming in just two or three weeks, first week of December in North America, which we believe a lot in. It's called the bed rack, a truck rack, which has the easiest and the fastest install in the market and easiest to adjust that we believe a lot in. We are building on the success in dog transport and the dog crate Thule Allax, launching the Thule Allax double door also in December, so coming very soon. We are introducing, as you have seen downstairs for those of you here physically, an upgraded version of our most premium bike carrier Thule Epos with the parking sensors. So no more damaged bikes or cars or also importantly, of course, bike carriers behind your cars, because now you will have parking sensors telling you to avoid obstacles. And lastly, we are still innovating in smaller categories that could potentially one day become champion candidates or even champions. And we are looking into, in this case, the car tents category, where we're bringing out Thule WideSky, which is a hard shell rooftop tent with a low profile, so helps the range for the electric vehicles, particularly, but also in general for fuel economy, very fast setup, and it actually has a bed that converts into a sofa. So the bedroom can become a living room, if you like. So that is the priorities in terms of growth for each respective product category, and that's how that builds up to our growth ambition. An with that, I leave it back to Toby to cover the rest of the financial targets.

Thank you, Mattias. All right. Now I'm going to go into our EBIT margin, first of all. And you can see on the top right, our EBIT margin. I'm going to drill down into that. And before I go into the future plan, I'm going to talk a little bit about the history and where our EBIT margin is today. I'm going to compare our margin to history. And basically, here, you can see I'm going to compare it to the pre-pandemic period. And why the pre-pandemic period? Well, during the pandemic when the volume swings and the sales swings up and down, the margin changed a lot and was very variable. The last time we had a stable margin profile was pre-pandemic, and I think it's relevant to compare our margin now with pre-pandemic. So here, you can see on the EBIT margin, we had an EBIT margin of 17.5% in the pre-pandemic period, which was between 2016 and 2019. And today, if we take the last 12 months up until the end of September, we have an EBIT margin of 16.1%. So this is a gap versus the pre-pandemic average of 1.4%. Now I'm going to break that down and show you where that difference comes from. Firstly, gross profit, and we've been working very actively in the last two or three years to drive increases in gross profit and drive increases in our quality of earnings with a better gross profit. And here, you can see the upward trend in the last couple of years, and we're up by 4.9% versus the pre-pandemic average. So we were 40.5% pre-pandemic, and now we're 45.4%. And I show you a bit of the components of that. We work actively with our price and product mix to increase gross margin. So that's 2 percentage points of the increase. We work all the time with optimizing our supply chain. So that's 0.5% of the increase. Although when you dig underneath that, we actually have 1.5% of, if you like, cash benefits in terms of supply chain efficiencies, but we're also carrying the extra depreciation because we have invested behind automation and efficiency in the factories, which carries the depreciation. So we have an increase in depreciation within that of 1%. So net, those two is 0.5%. Finally, Quad Lock has a different margin profile. It has a big share of DTC. So It has a higher gross profit and a higher SG&A, but the gross profit impact, in particular, is, of course, positive, and that's 2.4 percentage points. So all of those together make up the 4.9 percentage points of increased gross margin. And I mentioned we work to increase our gross margin to improve our quality of earnings. And what do I mean by that is basically that with a higher gross profit margin, we get much more leverage when we do manage to grow the top line, we can see much more effect on the bottom line from growth. And you can see, as an example of that effect, when you look in the pandemic period actually in particularly 2021 when the sales were at the highest in the pandemic, we did get considerable leverage and Thule has an ability to really leverage margins with growth. The other side of that, however, is, of course, the cost side and the selling and administration expenses. And here, selling and administration expenses have gone up 6.3%. The first impact I mentioned here, Quad Lock acquisition. As I said, this is positive on gross profit, but it's negative on Selling and Administration expenses. So here, it's an increase of 1.9% in Selling and Administration expenses. Overall, you can, of course, see that the impact is positive from Quad Lock, but again, positive on gross margin but negative on cost. Then we have the development and selling expenses. And these have increased by 3.5%. The biggest component here is the R&D expenses, which have gone up by 2.4%. And Mattias showed this graph earlier. You saw the graph where the R&D expenses as a proportion of sales. And that's really driven by the investment that's been made in the new categories, as you saw from that graph presented earlier. So that's the 2.4 percentage points in R&D. We've also had an increase of 1.1% on selling expenses. This is also partly driven by the investment behind the new categories and bringing the new categories to market. It's also a component in there is that as we increase, for example, our share of D2C sales, we have a higher level of cost and selling expenses to support D2C sales. So It helps our gross margin, but also increases cost. But there is also an impact in there from the weak organic growth that we don't get the scale to offset the inflation in selling expenses as well. That's also been a factor in the selling expenses, particularly in the last 12 to 24 months. Administration cost over this period is flat. And the last impact is the warehouse and distribution expenses. Where we invested in warehouse and distribution or we increased our warehouse and distribution during the pandemic, and we've been working, and we are working to bring that down, but it is an increase versus the pre-pandemic period of 0.8%. That just gives you a background of where we are today, and then I'll take you through where we are going to meet the financial target and how we're going to meet the financial target. And I'm going to take you to the steps we're going to take to get to the 20% financial target in two stages. And firstly, I'm going to focus on the left-hand side here. And firstly, you can see I start with the LTM margin, which is the one I just presented, the 16.1% EBIT margin. And I'm going to talk through some initiated cost actions we have ongoing, which are already initiated and are going to take us to 18.5% EBIT margin. And I've got three categories of cost actions that we are undertaking. The first one here, structural cost reductions. And this is a few things. Firstly, it's an investment in Poland, which Mattias has mentioned earlier, but it's an investment in automating our warehousing in Poland and our distribution, which will deliver cash benefits of SEK 100 million before depreciation. So that's one big impact. We're also consolidating our third-party warehousing and reducing third-party warehousing at the same time. We have structurally changed our cost base in North America, which Mattias also touched on earlier. We both changed the management structure in North America, but we've also closed an office in Colorado, which reduces our cost base in North America. And finally, we are investing in automation and digital solutions in administration and sales & marketing to drive cost reductions there as well. Altogether, those structural cost benefits will add approximately 1% of margin to the EBIT margin with full effect from 2028. And that full effect is because of the timing of the investment in Poland, which is contributing as well and will be fully implemented in 2028. The second area is development expenses. And here, as we've talked about, we will have a more focused investment in R&D going forward. We will focus more of our R&D on the champions, the 4% that Mattias mentioned earlier, and we'll have less as a share of revenue of our R&D in other areas. Altogether, we expect R&D to start to come down in absolute terms already next year. And by 2028, we expect to have a 1% reduction in R&D expenses as a percentage of sales. So that will drive 1% impact on the EBIT margin or improvement in the EBIT margin. And the third area here is on the initiated cost actions is the supply chain where we have improvement projects ongoing and in particular, in two areas, which are driving cost reductions and efficiency in the supply chain. One area we're working on is on in-sourcing component manufacturing, which increases the volume we produce in our factories and improves the efficiency we have in our own supply chain. That drives lower cost in our cost of goods sold, in our gross profit. And secondly, we are focusing on technology platforms and producing our key products across technology platforms, which allows us to combine production volumes across different products within the same categories. So for example, how we produce components and parts for bike carriers, which are common with each other to drive more efficiency in manufacturing. So altogether, those effects in supply chain, we expect to contribute 0.5% to the EBIT margin. So altogether, those initiated cost actions, which are already decided in ongoing and on track, will deliver 18.5% with full effect 2028. Then on top of the initiated cost actions, we have scale-driven effects. And here are three effects that I want to talk about. The first one impacts -- effects the impact gross profit. And here, we have capacity utilization is a significant one that we have significant free capacity in our factories. We did -- we invested quite a bit in the pandemic and increased capacity, and we still have a lot of free capacity in our factory footprint. And as we leverage that with growth, we get significant benefits in capacity utilization. On top of that, as we grow, we have more opportunities to drive efficiency with higher volumes and higher volumes through our manufacturing lines, both of which improve gross profit. We work actively all the time with our price and mix, not just to offset inflation in our material cost, but to actually drive improvements in our price and mix. And finally, just a comment here, but it's important to understand that as we grow the Quad Lock business, if the Quad Lock business grows faster than the average, just mathematically, it has a negative impact on gross profit. But of course, it has a positive impact on the other side on the cost base. So just something to remember that a faster growth in Quad Lock means a negative impact on -- sorry, a positive impact on gross profit and a negative impact on fixed cost. Yes. So those are the scale-driven effects in gross profit in Number 4 there. Number 5, you see the impact from leverage on the selling and administration expenses, which quite simply are yes, leverage on the fixed cost base, which are improved with the higher gross profit we have now. And here, again, I mentioned the Quad Lock. And then finally, the third one, we expect to drive growth even in a neutral market. But if the market is with us and the market is positive, then we expect additional market growth will contribute even more to the leverage we can get from scale-driven growth. And so all of those effects together, we expect to take us to 20% EBIT margin. And we talk again about the midterm. So 2 to 4 years is the time scale we think we can achieve that. Just one -- then I'll just mention one final topic just to mention on EBITDA. We focus and we have our target on EBIT. EBIT is the right focus we have to drive performance in Thule. But EBITDA, I'm sure as many of you know is the measure of the operating cash performance. So it's -- yes, EBITDA, it's before depreciation. But here, the level that we have in the last 12 months is actually 19.4%, which is above what we had in pre-pandemic. So cash-wise, we are performing better than the pre-pandemic EBITDA margin. And we expect also to improve EBITDA in line with the improvement in EBIT. We expect that to step up in the same way as we expect the EBIT margin to step up to reach 23.5% in the midterm. All right. That was EBIT margin. Now I'm going to drill down briefly into the leverage. And the leverage is not a financial target for us, but it is something that is important for us and that we pay close attention to. And just to show you the development of our leverage, this takes you back almost 10 years in the development of our leverage. And you can see, if you look at the bars, our net debt has increased in the last four quarters, obviously, because of the Quad Lock acquisition. But we are working our leverage down again. And you see the line is the leverage ratio, so the net debt to EBITDA. And we've worked that down, and we're now at 1.81 in terms of net debt to EBITDA, which is a conservative leverage, and we're in line with where Thule has been for a significant part of the history of that 10 years. So we maintain a conservative leverage, and that's important to us. And how do we do that? Well, the way we can manage to maintain a conservative leverage and continue to invest in growth is that we have a very good cash flow generation in Thule. And the cash flow conversion, in particular, is very strong. And here, you can see the bars on this chart measure the cash flow conversion. And the top one is, if you like, operational cash flow conversion. And the second bar underneath is the free cash flow conversion after all interest costs, all tax, so the free cash flow to equity. And whether you measure over the last 3 years, the last 5 years, the last 10 years, it's a strong cash flow generation that Thule has consistently delivered. And I think if you compare this to almost any peer, you will see that Thule is above the peers when it comes to cash flow generation, because we take so much of our investment through the P&L and that we drive our growth through investment through the P&L, we have a very strong cash flow generation. Ans what does this mean? It means we can manage that leverage I talked about, but also that we can both fund the good growth and invest in the good growth at Thule delivers and also pay a good dividend. And I'll come on to that final point now, the high dividend payout ratio. I click on. And here, you see the same time period for the last 3 years, the last 5 years, the last 10 years, Thule has consistently delivered a good dividend. The payout ratio is above 75% for the history. And that's a good dividend payout ratio of above 75%. We intend to continue that. So that's our -- also our financial target to continue to deliver a dividend with a payout ratio of 75% or above. And one important aspect of this high dividend payout ratio for us is that it really forces us to be disciplined within Thule, and it's an important part of driving a strict capital discipline in the company that we -- effectively, we put ourselves between a rock and a hard place that we both have to deliver a good dividend every year, and we have to ensure that we invest very wisely in the future growth to make sure we get the maximum return from that future growth. So it's really important that we invest every kroner of our investment very wisely. Yes, I would like to spend a few minutes just saying how we think about that when we do invest in future growth in Thule. Here, if you take the left-hand side of this chart, we make investments in growth in many ways in Thule. Firstly, we have a significant investment in R&D. So when you look historically, you've all seen the figures today, we invest between 5% and 7% of sales in R&D historically. If you look at CapEx, we've invested historically around 3% of sales. Both of those drive organic growth, R&D through, obviously, development. CapEx through improving and growing our supply chain, and we really focus those investments on really delivering organic growth. And on the bottom left, we -- after -- with the good cash flow generation after we funded the dividend, there is cash flow left over to drive growth as well, and we can use our debt financing capacity as well. And both of those are available to support growth investments as well. On top of that, for example, yes, add-on selective M&A. And when we make these investments, I think -- I want to talk a little bit about how we think. Can you see on the right-hand side here, you can see the chart that Aden brought up earlier. We have the diagram of how we think when we look for new opportunities with big in pockets and making sure it matches our innovation with market tailwinds. So that's very important to identify new opportunities. But then we make very disciplined strict business plans and have strict return on capital criteria when we evaluate and decide on these investments. That's a very important part of our process. We have clear risk-based return criteria that we apply to our investments. We make those assessments in planning. We have a very strict project process within Thule. And you may be heard in the -- there was a video earlier on where they talked about the project planning process where we have different toll-gates all the time. And every time we come to a toll-gate, we reassess, we maybe adjust, we accelerate, we decelerate or we stop a project, depending on whether we think that return is still good enough. That's -- yes, a very important part of the process. And finally, that we do a post-investment review after all investment projects in Thule to make sure we share the learnings and make sure we take forward the learnings to future projects as well. All right. Then a final point, I think, is also very important here is that the management incentives in Thule are also fully aligned with TSR. So the management team has incentives aligned to total shareholder return, and we're in the same boat as the shareholders of Thule. So driving return is also very important to drive return in the investments and drive return in the share. Both Mattias and I have invested more than 3/4 of our net salary we've had from Thule since we started in warrants and shares in Thule. So we're very committed to -- yes, to Thule and driving shareholder return in Thule, and the whole management team is. All right. On top of that, we have a few words on our capital allocation priorities. We have three priorities here. The first priority that we have when we allocate our capital is fueling profitable organic growth. That's number one. And here, we invest in our product innovation and focus there on building bigger and more champions is what we will do. We focus on our supply chain and efficiency and capacity in our supply chain. We have significant benefits to improve capacity utilization, but we can drive more and more efficiency also through automation. And finally, it's very important to us to meet our sustainability goals as well. So we -- that's a part of investing in our organic growth as well. So that's number 1. Number 2 is maintaining the attractive dividend, maintaining 75% of net income as a dividend. And at the same time, keeping a strong balance sheet. And again, this is important to us to make sure we have strict discipline in our capital allocation that we -- yes, we have to prioritize our allocation and our capital very carefully. And finally, the third priority is that we use our funds to invest in selective and clearly value creating add-on M&A. And here, we want our M&A to support developing our existing champions or building new champions. And as I say, we will be very rigorous we making sure that any M&A is clearly value creating, is clearly accretive to Thule, but that is -- that is our third capital allocation priority. So in summary, we have a clear path to reaching our financial targets. We think we can build the current and new champions to drive 7% annual organic sales growth. We have initiated cost actions that are in place and on track together with scale effects, which can take the EBITA -- EBIT margin and will take the EBIT margin to 20%. And then our strong cash conversion within Thule enables us also at the same time as investing in that growth to be able to distribute 75% of net income as a dividend. With that, I will hand over to Mattias for a summary.

Thank you, Toby. I started this day saying that I'd like you to remember three things in particular. Firstly, Thule has a proven ability to grow profitably, and it is our conviction that we will continue to do so at an even higher pace, driven by the Thule champions and efficiency gains. And now that we have spent this afternoon together going through the details, we can nuance the message a bit and summarize it according to this. So as Toby said, we have a really clear plan to reach our financial targets. Our conviction is underpinned by the fact that we create our value through champion product categories, and that our ambition is to focus on what's worked, focus on exactly that and move from 6 product categories as champions now to 10 champions by 2035, helping scale up profitable organic growth. So that wraps the whole presentation of Chapter 4 and therefore, the presentation today. And now we move into the final Q&A sessions.

Okay. So final Q&A session, right? So let's start with an online question, and this one is pretty straightforward. Have you increased prices too much?

Shall I start...

We can start.

No I think -- I mean it's a valid question. I think when you look at Thule, we have products in different segments. So we launched products in the premium segment, in the mid-price segment, and in the low-price segment. So I think one point to raise I think we don't -- we don't raise prices just for the sake of raising prices, but we maybe launch more products sometimes in the premium segment than the mid-price segment. And you can say, I think in recent years, we have invested more in the premium price segment probably 3, 4 years ago, which has driven probably more of the new products we've launched have been in the premium price segment over the last couple of years. And now we're bringing more in the mid-price segment as well. So that's Number 1. Yes, Number 2 I think, I would just -- I think one question I know this is kind of question out there, have we raised prices too much. So it's a general question. But to me if we have raised prices too much you would -- you would have seen someone else take more of the pie from Thule. And I can't see someone else who's taking more of the pie from Thule. That's how I would kind of throw the question back, if you like if -- yes, if we had lost due to price, someone else would have gained. And I can't -- no one can tell us who that would be in simple terms. But it is a very important question to us. We work very hard to make sure we understand are we positioned right and are we pricing right, and, yes, are we maximizing the growth at the same time.

I think it's a good comment and just adding a little bit more to that. For sure, we have increased prices when there's been dramatic raw material and other factors in place, so has everybody, us not more than others, to your point. Probably today, we are favored, particularly in North America by having local productions. We see others raising prices more than we have done. But I'd say that to your point, too, Toby, pricing is not about the average, it's about creating the value in the right price segment. There, we have opportunities as we think we've shown today, actually to go both premium plus with, for example, the Thule Epos parking sensors of ParkSecure, but also in the lower prices. Today, we actually see the best performance in the premium band where we have the higher price point. So it is -- pricing is both an art and a science. As long as it comes with good new products, independent of the price point, we can grow.

I think we have a lot of questions from the audience. Let's start with...

Yes, I have two questions. So starting with Kids & Dogs, you obviously expect very good growth in the future. I think that previously, you said that you target SEK 1 billion in revenue by 2030. Is that target still achievable? And also, if you could give us some milestones towards that target. For example, what revenues do you expect to reach in that category in child seats in 2025?

Yes. So thank you. So I think if I remember correctly, the ambition of SEK 1 billion sales in that product category was launched in conjunction with a SEK 20 billion sales target for 2030. As I commented on when we talked about financial targets, I think that was set during sort of a different time with a different market situation. And we have actually changed the mindset more to think more about growth in terms of percentage growth over a year, as you have seen. So no, there is no specific milestone or target that SEK 1 billion by 2030 is more important than anything else. It's about expanding this product portfolio. We could do faster, of course, but then it will cost more money. This is a more balanced approach. But we do see the opportunities to build sort of champions, which we internally say is sort of SEK 500 million sort of cutoff point in both car seats and dog transportation. So we are continuing to invest, and those are two of the candidates that we have the highest hopes for at the moment.

All right. Then, Toby, a question to you actually. I think on the chart showing the EBIT bridge, you had some dotted lines there in the part showing the benefits from the scale. What did you want to say with that? Is there an upside to 20% EBIT margin if the market returns? Or what kind of volumes would you need to see to reach that?

There is upside. I mean the scale-driven effects improve with more scale. That means the more growth and the more positive market environment means we can drive those effects even more. So there is upside, absolutely.

And I think to add to that, I think a sort of dramatic version of that we have in the history, right? During the COVID period, we saw what happened and the scale effects at Thule were really positive. EBIT margin really went up very well. So I think would we see a positive market quicker than we expect and or at a higher sort of level than we expect, then of course, that would also impact our margin profile.

Daniel?

Maybe just coming back to the cost side and some of it is related to execution in Poland, of course, and that will take some time. As I understood that, that's going to be sort of ramping up through '27 and fully effect in '28. But other things are rolling more quickly. And one is, of course, with the changes you made in the U.S. You also talked about sort of extra warehousing maybe not being needed and all that. And on top of that, you also mentioned today that the R&D spending will be less in absolute terms next year than in this year. If you put those three together, how much does that move the needle in terms of the cost base in '26 versus '25?

Yes. I think -- I mean we will be on our way towards that target already in '26. So, yes, some effects will take time, and we do expect full effect '28, but we expect that to come successively through '26 and '27 and '28. But, yes, we don't have an exact number for '26, '27, and '28.

But some of it will already come through in Q4 now, right, when it comes to the U.S.

That will start to come through in Q4, yes.

Yes. And then gradually build through '26 into '27. Okay. And then you didn't talk about and that's difficult, I assume. I can understand that. You didn't really talk about mix changes. And of course, it depends on where the demand sort of ends up. But you do have your growth ambitions per business area. And at the same time, you also want to phase out Case Logic and some other parts, which I assume could be low margin. And If you put that into the equation, does that alter the numbers a bit? Or could you give any sort of shed some light on that?

Yes. Basically, there are some variances across -- between different categories in the margins. Sometimes it's a different profile. So let's take RV, for example, it's a lower gross margin, but it's a lower cost to serve the market. So the EBIT margin is in line with the others, but the profile is a bit different. But overall there are -- we don't expect the different growth rates from, for example, Active with Kids. Mounts & Bags versus Sports & Cargo Carriers and RV to change the margin profile. It's pretty neutral. And we don't have -- in summary, we -- of course, we have variations, but there's not big variations between categories. All categories have, yes, have positive and healthy margins. So there's not a significant mix change.

Then maybe the third piece of the puzzle is your own sort of production level. You've actually stated, I think, that you've increased production, although the inventory has been coming down. And I guess that's a mix effect as well between sort of third party and your own production and what's selling and what's not selling. But you have realized quite a lot -- it looks like a lot more than you promised in terms of inventories coming down and there might be seasonal effects and so on that might be bouncing up in Q4. But if you look at that variable, is there more to gain sort of already next year in a slightly growing market from you having taken down inventories quite a lot in the past two years and you might need to maybe ramp up a little bit more sort of a hard question, but any sort of some light on that?

I would say in a growing market -- growth next year, we mean growth in capacity utilization, which means we will be producing more, and we will -- that will help us drive better efficiencies in our supply chain as well.

But do you think you're too low now? Because I think you're back to the levels where you were pre-pandemic and your assortment is much wider.

Yes, we're back to -- so we expect to deliver SEK 200 million of inventory reduction this year at the end of the year. So we're on track for that. But then we think we're down at a level ahead of sustainable level. Yes, we're ahead of that. There is some seasonality through the year. So I think wait till the end of the year. But we should be ahead of that, I think. But we with then what we believe is a level of inventory that we can keep in relation to sales as we go forward. So as we grow, yes, we will need to hold more inventory, but we don't need to bounce back to a higher level at the same sales level.

Let's take an online question in between. So could you split up the 7% growth target into price, mix, and volume?

Can I start? Yes.

I think in general, Thule has had a price increases if we exclude the sort of dramatic years of COVID and specific things around tariffs in the U.S. of around 1%, 1.5% per year for the existing products we have in the market. And that's how we think about the assumption going forward as well. Now the increased effect we have on our average net selling price is coming from new products, particularly when we replace an old generation product with an upgraded version of the same, if you like. We typically are able to add good features and better design, and we carry a bit of a higher price point. So we don't expect to drive the formula, if you like, in any other way than we've seen in the past unless there are new shocks to the system, if you call it that. So low single-digit ongoing price increases and then driving [A&SP] through news and the rest should be volume.

The next question.

I'm going to build on the earlier question about upside to the 20% target. I noticed in the chart showing your expected ambition to get to 2028 and 18.5% didn't include market growth. So should the assumption here be that there is more upside to 2028 then? And also, one more question about the margin. Previously, I believe your target was to be above 20%. So I guess, yes, how do you think about that?

Yes, I can start. We have initiated cost actions, which we expect to take us to 18.5% without market growth. But with growth and scale-driven effects, that's what takes us to 20%.

We're happy for that to happen already tomorrow or latest next year. But of course, we expect the market to get better, right, before 2028. And of course We hope to get some scale effects before that. I think the part of the chart was more to show the types of effect rather than the timing.

Yes. Exactly.

And I think regarding the financial target, I think we have actually rephrased it a bit. It was -- maybe Catharina has the exact definition, but equal or greater to.

No it was maintained 20% underlying EBIT margin.

Right. Also set, I think, at a time where we were at the peak of COVID. So I think we have just simplified it and said the growth is -- target is to get to 20%, but...

It was actually maintained more than 20% EBIT margin. Yes, that's the correct word. Yes.

Change of wording.

First one, I assume to Toby, back to the EBIT bridge. You said R&D down absolute terms next year. But then to get to the 1 percentage point, what have you actually assumed in terms of growth in 2027 then, I guess?

So we are saying we expect to get full effect down 1% from 2028, so the first year. We will have to adjust a bit as we go. So we're not committing to -- we will see how growth develops over that time, but we fully expect to get down 1% by 2028.

Regardless of top line.

But I think we have also to the point, it's important to remember that we look at R&D as an expense line in our P&L, but it really is a portfolio of investments, and we can choose which products to start, to keep or to stop. And I think with the focus that we have now established on sort of the existing champions and building new ones, those will steer how we invest. And that's why we are convinced that we will get the R&D spend down in total, but still focus on what has proven to create the most value in history.

Okay. Good. And then I believe you said earlier that Quad Lock has seen a positive margin development. So just to clarify, Quad Lock has a stronger EBIT margin today than when you acquired it.

Not sure that's what you meant to say.

No, it's positive. So it contributes positively to Thule's margin. I showed you the gross profit and the cost side. It's positive to Thule's margin, but its profitability is also developing well. But...

Yes. That's what I picked up on. No mind. Maybe last one on M&A. I guess you mentioned it a few times during the presentations. But at the same time, leverage is sort of stretched, I guess, at 1.8x. So where do you feel comfortable striking new deals at this point?

Yes. I would say -- I mean, I think we are comfortable at 1.8. We want to continue to work and we have good cash flow, which helps us bring it down. But we don't want to commit to a certain figure that that's kind of what we define as a conservative leverage. But it's important to us to maintain a good credit quality and a good conservative balance sheet. That's an important part of Thule's growth story as well. Yes, I think -- I would say we use history as a guide. We're back to a same similar level we've been through history, and we want to keep that.

Yes. I have a question on your capital discipline. I just wonder why don't you have an official return on capital employed, for example, target? And also, if you have any internal targets with that regards?

Yes, I can take. I mean the simple answer is the biggest part of our investment is development cost, which never ends up on our balance sheet. So if -- you can calculate return on capital from our balance sheet, but it doesn't tell even half the story because the biggest part of our activity to drive growth and invest in growth is we take through development and R&D. Having said that, when we do projects, we absolutely -- we have a business plan and we make sure we get the return from that business plan that we want to get. And we measure return on -- we measure ROIC, return on invested capital in our business plan. And then I mean second part of your question, we have numbers internally. We want to see. We don't have one number that every project has to be at 15%. If we have maybe a very secure project that's almost guaranteed to deliver a return maybe in a secure supply chain area or something, then maybe 12% is good enough. But if there's something with a higher risk, maybe we need 20%, 25%. So we do that's what I mean by saying risk-based. So we do risk assessments and -- but it's rigorous return on capital assessments are used to decide if we should do a project or not.

Maybe just -- I think you've gotten this question before, but I think you expanded on it a bit more today. You've been in the sort of better and best category. Now you talk a little bit more about good. And do you still feel that investing in good will give you the profitability that is sort of on par or higher than where you are as a group where you target these sort of good investments, so to speak?

Yes, I can start. I think you make -- it's correct. We are investing more in mid-price this year. And next year, we will actually do a bit of both. We have the parking sensor, more premium we ever done in bike carriers, but we are on that list of products that went through very quickly, introducing a new version of a good level rooftop box called Thule Pulse coming in Q1 and actually and as we measure it, entry-level bike carrier called Thule VeloLite, which is coming in at -- we think, an attractive price point. But. Yes, in these categories, which are also champions, I mean we have a strong manufacturing footprint, a lot of technical know-how, and we, of course, design these products according to specifications that also allow us to have a good margin. So I would say about average margin that we have today, they're not accretive, but we do it because, a, we think we can drive revenue and volume; and b, it's also good from a competitive point of view that we make sure to protect that side of the market and don't let new entrants come sniffing from the low entry points and then develop capabilities to go further.

Okay. Then maybe just secondly, on the tariffs, we haven't talked about that much today, but it's been a topic of course, through the year. With the price increases that you did make, and I think you've talked about maybe additional compensating prices by the 1st of January, I might be wrong, but that was my interpretation. Where are you in terms of cost coverage, so to speak, now? And where do you think you will be by 1st of January?

Yes. I mean we increased prices in 1st of June this year in North America by 9% on average, which offset the tariff impact that we saw at that point. There have been some changes since then, particularly steel and aluminum tariffs have changed. It's not at the same scale, but they have gone up in terms of steel and aluminum, and we will compensate a bit more in the price increase from 1st of January in North America, and then we expect to be fully covered.

And then maybe coming back to the question that we talked about a couple of months ago, is that also covering -- is that on a one-to-one basis? Or is it covering for the margin as well?

So it's covering -- we want to be margin neutral basically, on a margin basis.

And just to add to that, the way we're trying to think about is, of course, we look at the direct mathematical impact of the tariffs, but there are several moving parts here. We, of course, try to look at other sources, if we can, sourcing components from other areas if needed, but it impacts freight costs, raw material prices and a lot of things. But our goal is to be margin neutral. There is a little bit of timing to this, as Toby just mentioned and that you are well aware of. But coming out of the other side in January, we think we will be margin neutral.

As time goes on, there's more we can work with to offset this impact as well. We're offsetting through sourcing. And we can resource more locally in North America. Also looking at our manufacturing footprint, can we manufacture more parts in North America to avoid some tariffs as well. So we expect to offset some of the impact, but some of that takes more time.

I think we might have a final question from the online audience. About the champions, are these to be expected in Europe and the U.S.? Or could it potentially present an entry into markets where you're likely less exposed like China?

Yes. The champions can be, let's call it, geographically agnostic. They could be a global champion or it could be like we have today in our RV business that's almost entirely an European business. As I said, we have a few things in the works. Some of them are regional. We are, of course, looking into Asia and also now in some strong outdoor markets like Australia, we're stepping in, but could also be global. So the most important thing is that it's a product category where we are the clear global #1.

Any last question from the audience here in the room? No. Then we have reached the finish line. Thank you for bringing your best questions and keeping up the energy levels. I'll hand over to Mattias for some closing remarks.

Thank you very much. I'll move over here, so everybody can see. Thank you very much, everybody, for joining, whether it was digitally or physically here in Malmo. This concludes the session today. For those of you who are here, there are still some great Thule products downstairs to take a look at or play with. And some of the management team are hanging around. So feel free to stay around, if you like. But if not, look forward to seeing you at the next event. Thank you very much.