Fielmann Group Ag U/Adr

Good day, ladies and gentlemen, and a warm welcome to today's earnings call of the Fielmann Group AG following the publication of the financial half-year figures of 2025. And with this, I'm happy to hand over to Fielmann's CFO, Steffen Becher.

Hello. Well, Ingmar, that was definitely the most enthusiastic intro we had in a long time. Thank you very much for that. And I think it's just It really given the way the company performed. I think this is the right setting the right tone. So to say welcome everybody to our earnings call for the half year one results that and that is the period ending 30th of June. Today is the 28th of August. We already published our preliminary numbers just ahead of our AGM on the 10th or 11th or something of July. So no real news, but still we want to give you the opportunity to hear a little bit more on the numbers and definitely give you the opportunity to ask any questions You might have, you are all aware that this is the half year one results call and we're going to host in September, we're going to host a more comprehensive session on our vision 2030 and or vision 2035 and targets 2030 that we announced on the AGM where we're going to So let's jump straight to the summary. But before we do that, I have with me Nils Scharwichter and Nils Scharwichter most of you know maybe Nils you turn on the camera there is Nils hello and Nils has been as I introduced him to some of you as he was one of my guys so working in the CFO office He has been with the company six years then left us to do some equity research then came back. We're very happy to announce that mid of August we promoted Niels to Permanent full-time director of investor relations Patrick Möller who was with us for a few months helped us tremendously in taking what we had you know telling us what you know normal companies should have helped us through the AGM and he's now taking a well-deserved break and we thank him very much for everything he did for us. And he basically helped me to jump into this position. And I'm actually super proud that somebody who after school decided to do his first professional endeavor with Thielmann is now a director in our company and part of the senior management team. Thank you very much for everything you've done here so far. Good luck. And very glad to have you on board or being in a different role. With that, we go to the summary of the first half year in a nutshell. We continue our growth trajectory. We have a slight delay here. We continue our growth trajectory. We continue our margin expansion. We are in a challenging environment. Consumer sentiment is still, because of everything that's going on, is still difficult. In the first quarter, we had a lot of snow, even a lot for upper Midwest standards, a lot of snow. And then we had Liberation Day right on the beginning of the second quarter. And all that was absolutely not helpful for consumer sentiment, but it has picked up since. in, you know, in late May, June, it started to pick up. But still, across the world, challenging consumer sentiment was true. We do have a strong development across all major markets. We have a very strong development across all product categories. So very Happy with the numbers that we're producing. You see that group sales increased by 12%, 4.5% of that organically. Around 8% come from the U.S. acquisition, so SHOPGO that we consolidated fully for the first time on 1st July 2024. So with that, we're basically down to organic growth for the remainder of the year. Just want to flag that to you so that you don't expect, you know, all these big numbers from now on. Quarter by quarter, it's going to be organic. 4.5% is good. It's not great. It's definitely at the low end. Over the last five, six years, we delivered around 6% organic growth, but, you know, with four and a half in that environment, we are satisfied. Vision 2030, our target is around 5% organic growth in that part of the business. So we're kind of there, but as I said, definitely on the lower end of the range that we're going to deliver. Our group suggested EBITDA profitability. We always said, and I've been saying it for the last, two years actually that I've been working for a few months just at my anniversary one and a half weeks ago so for the last two years I've been saying we're working on profitability we're working on profitability and we're working on profitability adjusted EBITDA improved significantly margin for the group is now at 24% after 21% last year Europe at 25% US at 15% all with quite impressive growth rates and that is You know, the usual mix. That's the great news about our business. There are no news in terms of what we do. We're pulling the same levers that we've been pulling, you know, cost control, efficiency in the stores, and, and improve continuously improving sellout structure and all that trust profitability. for the business and gets us fully into the target corridor that we have. Adjusted EBITDA, EBT increased also substantially by 29%. Margin is now at 12.9% after 11% in the last year and that is despite, you know, us I think 300 million and 300 million in debt, which obviously is not helpful for EBT. You know, we have all the PPAs, so the acquisition related riders of the intangible. So despite all that, our margin is improving. And it's actually quite a nice pyramid shape that you want to have as a As a CFO, you want to have group sales at 12%, adjusted EBITDA by 26%, and then adjusted EBT by 29%. So you have this pyramid structure. The further down you go in your P&L structure, the higher the percentage growth rate. That shows you that we're looking at operation leverage here, which is exactly what we're aiming for. We confirmed, and I know this is boring, but there are quite a few companies who didn't. We confirm our outlook that we published for the financial year 2025. So we're saying nearly 2.5 billion sales, 24% margin for the group. And looking at the results, you see why we do that. We have a slide later at the end of the presentation on that. And we announced Vision 2035 and targets for 2030 in our ADM. And as I said, in September, we're going to talk about that. On the next slide. You see the numbers basically again, but in a much prettier shape. You see the total consolidated sales with the organic growth. CAGR actually for 23 to 25 was 12%, so we're pretty stable on the consolidated sales growth rate. CAGR for adjusted EBITDA was about 19% now this you know the last year we were 26 so we see an acceleration but that's also acquisition driven Q2 in profitability we typically talk about year to date but Q2 was a bit lower but that's basically a phasing of our marketing expenses we really held back you know with timing the marketing a little bit according to season and that changes every year because you know we're not one of these companies that says we always do this campaign then and then we do the other campaign then so we face it a bit so there's an 8 million difference in marketing spent between Q1 and Q2 and if you factor that in for the Excel guys among you that's the in other operating expenses if you factor that in then you see that actually the profitability across the quarters is pretty similar product mix we always if the Sun is with us and it was this year especially in Germany if the Sun is with us we always have a slightly higher Cost of goods sold in Q2 that's basically driven by more sun and therefore more sunglasses and margin on sunglasses without prescription is lower than margin on glasses with prescription. And that's basically it because all the Northern Europeans, once the sun comes out, they come to feel them and they buy new pair of sunglasses. We talked about 28 or 29% growth. The CAGR for the two years is 23%. So we see an acceleration. We see a stableness in the sales growth. We see an acceleration in the profitability growth, which is exactly what we wanted. A bit more into detail, the top line growth or the top line increased by 12%. By now, everybody knows that song. Let's look at what we mean when we say all product categories in all countries. Here you see the product categories. First, you look at it and sunglasses is the only one. that helped me back by writing double digit growth in all product categories. Sunglasses still at plus 9%. and all other categories at double digit growth. This is obviously mainly influenced by the Schottko optical consolidation, especially the contact lenses, because the contact lenses are a strong product in the U.S. Organically, we put that here for your further information. and adjacent healthcare services relatively small high growth because all the eye exams we do in our US practices as basically adjacent those eye exams done by the optometrists are actually adjacent healthcare services by 87% Organically, it's still 50%, but that's because we're really trying to broaden in the US. We're trying to broaden the availability of doctor appointment, and that's why that category grows. And it also grows because we have our eye care, eye health checkup in Europe, and that is developing as well as undoubtedly you have. I wear 4% some of that influenced by by our US acquisition organically to be honest SVS vision a bit struggling if you put if you put together the SVS and Shopko and you treat them as if we acquired them all on day one, you see a slight growth in unit sales in the US and we're flat to slightly positive in unit sales in Europe. As I said, very, very challenging consumer environment at the moment for us. so we're pretty happy that we're outperforming the market with our growth and that's partially by this growing slightly above zero and it's partly because we're growing quite extensively as we do in you know countries like Spain and Austria and the Czech Republic and Poland we see that there the economy is a lot more is a lot more vibrant and therefore we also see that we have higher unit sales than for example in Germany Innovation is driving our adjacent iHealth business. We have the, as I said, we have the iCheckup and then we have the business in the US and you might, you know, all these trends that you see here are basically the foundation for our 2030 targets. So these strategic growth drivers that you see on this page and that we talked about, are basically the growth drivers that we're going to use to get to our 2030 targets. But as I said, that's more equivalent than what September had. One way to tell you the story. So product categories overall, you know, ignore sunglasses, double digit growth. We're very happy with that. If we look at the individual markets, On the next page, you see the company growing, the group growing at 12%, obviously the U.S. at 143%. That's driven by the SHOPCORE optical consolidation. I'm so glad that this consolidation part is over and we can talk about real numbers going forward. All the other countries, as you see, 5%, 8%, you know, 5%, 6%. So really a healthy development. Think about where we stand and what the state of the world is and you know and what market position we have so you have an absolute market leader in Germany, Switzerland and Austria and in these countries we still grow by five and six percent and outperforming the market overall. We're still at mid-syndagic and that's as we always said you know four to seven percent is our guidance for organic growth in Europe The US is now our second largest market, which still driving the integration of the businesses. So, you know, I said earlier in Q1, we were done with the, you know, systems integration. So the, you know, management team integration, now it's all about business model transformation, which try out a few things and you know, identify the winning formula for all the U.S. But still, all that integration really drives profitability, as you will see on, you know, on one of the latest slides that the profitability has really increased quite dramatically. And actually, we're higher in the U.S. profitability now than we were individually in those companies when we acquired them. Spain and Portugal still our high growth dynamic. countries they are performing the market I always said the great thing about our country portfolio is not only that you know we touch the lives of a few hundred million people but and you know help them to hear and see the beauty in the world better but we also have a great portfolio of countries in terms of very, very mature market leading companies in USA, you know, and then some really hot growth engines in Spain and Poland, and then some, you know, next generation growth entries like in the Czech Republic. In others, that's basically where you're going to find Poland. You're also going to find Italy. They have returned to growth. You know, we closed quite a few stores there because we had to review our profitability profile and it was not a profitability profile. It now is. Still, you know, mid-teens in terms of profitability for the year and Italy has also now returned to growth. after the store closes. So they're only at 2%, but still, you know, after everything the country went through, it's pretty great. And we're continuing to become more and more international 39% of sales are generated by Germany and that's just because of the US dollar that depreciated against the euro quite dramatically. Otherwise, we would have hit our target of 40%. But you know, in 2023, we were at 30%. So quite a dramatic increase in, in, you know, out of Germany sales, which helps us to be, you know, a lot more balanced across the global economy, looking at profitability. On the next slide, significant margin improvement. I told you all that you read about it. Yeah, Europe at 24.8%, so 25%, the US at 15%. You know, Europe is going to be there or there about for the end of the year, we said that in our, in our, in our guidance for the year, the US is going to improve a little bit. definitely not to 20%, somewhere between 16 and 18, 19-ish. And that's where the U.S. is going to land. So they're going to improve further and further and thinking about that they came from just under 10% by the end of 2024, ending up at mid-teens, high mid-teens is going to be a great success. And we're very happy with the EBT, I think. Looking at half the numbers, we also look at the balance sheet. Pretty happy, actually very happy. You need to move that finger away from the numbers. Yeah, thanks. Cash generation in the first year, we had a bridge facility for about 305 million and we refinanced 275 million. So despite that decrease in financial debt, which we paid out of cash, we still have 100 million more cash at hand than we had at the year end. We're going to pay a dividend of about 96 million. So first half year, we worked for the company to provide the company with. enough cash to grow and invest net debt to EBITDA so unadjusted EBITDA so our leverage is at 1.1 if you adjusted for the dividend that we don't that we then paid like two weeks after after the cutoff date and it's still 1.2 coming from 1.7 so pretty dramatic de-leveraging and that's all because of the strong cash generation, the EBITDA growth. So, you know, two-pronged approach. We're actually paying down debt, we're actually accumulating cash, and we're growing the EBITDA at the same time, and that's how we deliver the business. You know that in terms of leverage, our policy is, you know, we feel very comfortable with anything that has and that is below two. And yeah, we're at the lower end of that and that is including leases. Our equity ratio improved and jumped over the 40%. And then one of the bigger effects for those who look in detail at the at the balance sheet is the currency translation. So Euro to U.S. dollar, U.S. dollar depreciated from 104 against the Euro in December to 117. and that really drives a decrease in intangibles, goodwill and right of use assets, aka rent or leases, whatever you want to call it. That effect decreases our balance sheet by 35, 45 million euros alone just because of that currency translation effect. But as I said, it's all a non-factual rent, it's a translation and not transactional. On the next page, looking at our cash flow. Cash flow statement is mainly impacted by the U.S. acquisition and opposite roles in the business. Operating cash flow jumping from 198 to 236. The main difference here is slightly lower cash conversion with paid out bonuses. So slightly higher bonuses, so the provisions went down, the cash went out. So the cash conversion rate between operating cash and EBITDA moved from 86 to 83, still a very high cash generation. And the driver behind the growth is the EBITDA improvement because, you know, we're a cash on transaction business. People get their glasses and they pay. And then, yes, we deal with health insurances and all that. But the major part is cash on delivery. And that broke for a very healthy cash flow profile. In the U.S., we actually take down payments on ordering. So we actually have a slightly, you know, we actually have a positive working capital effect from growth there. So that's a small that you see. Cash flow from investing activities. 37 million, prior year was 15 million. If we just look at the maintenance and growth capex, remember we paid for the SHOPCO acquisition on the 1st of July. This is the 30th of June, so it's not in here. If you just look at maintenance and growth capex, we are this year at 37 million, last year we were at 33 million. And that is basically in line with our growing business. And then the prior year, you know, why is the prior year 15 million when you already spent 15 million for maintenance and growth capex? Well, because we had disposals and we had basically and basically to generate the cash. And that was a 18 million cash inflows. So 33 minus 18 is the 15. And this year we didn't do any of that in a significant manner.

So it's 37 and this is seven it's zero. So that's why 37 and 15 million.

cash flow from financing activities all over the place minus 100 million this half year plus 96 million last year well we paid our shop go acquisition on the 1st of july but to make sure that we can pay on the 1st of july we last year we had to increase our debt by as i said you know initially 200 280 million um and that was the cash inflow and this year we basically repaid the debt we we we raised the should shine uh that's a promissory note um that should i think everybody knows sunshine So that's basically what we did here in financing. And then we have the repayment of leasing liabilities, and that's in line with our own business. So we remain highly cash generative. We have a high quality balance sheet, but still maybe on the lower end of the leverage. And we're pretty happy with that more conservative approach. Which is the opportunities for this year that we see? Well, opportunity would be a strong organic growth in our established European markets. You see it in those markets. We are really doing good in those markets that have a more vibrant economy like Poland, the Czech Republic, Spain. That's where as soon as that happens, it has a direct impact on us. Germany is still We still do have great potential for expansion optical retail in the US and Spain, Eastern Europe and hearing aids. Hearing aids, you see it. Spain and Eastern Europe, you see it as well. And the US, as I said, we're trying out things, we're in the middle of the business model transformation. So for us, you know, we don't think quarter by quarter, we think more longer term for us. laying a proper foundation and really, really addressing the US market in the right way will help us in the long run to really reap the benefits and bring the US to where we want them to be, which is, you know, a strong organic growth with a margin that's very similar to our European businesses. So that's what we're doing at the moment. of our senior management team members has now transferred to the U.S. He was our strategy manager. He has now transferred to the U.S. and is living there and working there and basically running the business model transformation together with the U.S. leadership team. Our chief sales officer, Bastian Körber, is spending now about 10 days a month in the U.S. to help with that. So we really have full focus now on the business model transformation in the U.S. and that will bring us tremendous joy and potential for expansion in the future. Probably, you know, only a quarter of that this year, if at all, but definitely for the future. Primary eye care is definitely a promising market. You see that we're growing. You will probably listen to what we said at the AGM or the strategy recording that Mark and I did and where we also talk about this as being a small but very important piece of what we're going to be doing over the next five years. Unchanged consumer sentiment is the biggest impediment where we have the growth. A skilled labor shortage is becoming more and more an issue that we have under control. Trade conflicts and tariffs. Well, for now, the EU and the US have a deal. Our industry analysts said, you know, You know, they signed the deal and there is very little impact on the optical industry. And we always said that, that at the moment, we don't see any problems there. But, you know, let's see how long those agreements hold before we're happy. But at the moment, I would say trade conflicts and tariffs are going a little bit down on the risk. The biggest risk remains by far the consumer sentiment. Now let's get to our outlook for 2025 at the last slide. We're totally on course to achieve our targets. Customer satisfaction is where it should be. Our customers are happy and that's great because happy customers talk about their experience and happy customers return. Unit sales. at 4.7 million. So we said around 9.5 million. I talked about the reasons and so we're confident to get into that direction. Total consolidates at nearly two and a half billion and I can fully confirm that. Consensus is about 2.47, and that's, you know, we think along those lines as well. Adjusted EBITDA of around 580, a margin of about 24%, with the European margin around 25%, and the U.S. margin being in the high mid-teens. So, we are confirming that, and the adjusted EBITDA margin increased by, you know, we said that we didn't know how all that financing and and the acquisition goodwill impairment, you know, write downs and all that work. So we said it's gonna grow at a similar rate. Well, it's gonna grow on 1.7% so far. So we're pretty confident in that. So we are one of the companies who basically say, yeah, you know, it's end of August and we confirm our targets for the year. And with that, I came to the end of my short presentation and we have a bit of time

Yes, thank you very much for the presentation, and we will now be happy to answer your questions in a couple of minutes. And for a dynamic conversation, we kindly ask you to ask your questions in person via the audio line. You can do this by raising your hand. If you're dialed in by phone, please use the key combination star 9 followed by star 6. or our chat box if you're not able to speak freely. And we have received a couple of questions. Mr. Ebert, you should be able to speak now.

Yes, can you hear me?

Yes.

Q2 Sales Number vs Q1 Could you give us an indication how much of this was FX translation effect, whether there are normal seasonality patterns here, and kind of what measures you're taking and what you expect in the coming quarters there? And then I'll ask my second question. Thank you.

Yeah, U.S., as I said, it's a – It's an interesting environment. Q1, we were still up against the weather, which was a lot worse than usual in the Midwest, and that means a lot. and definitely Q2 Liberation Day. So President Trump's announcement of the magic formula for tariffs didn't really help a lot for the stock markets. And you know how dependent the Americans are on the stock markets for everything in their life, especially. So that wasn't helpful. That really knocked down consumer sentiment. So we could instantaneously feel that people were hitting the brakes, you know, going into full backward throttle to say, look, you know, we don't know what's going on with the economy with my personal income. So we'll be, you know, we'll be very cautious with what's gonna happen here. So, we really sensed that. So, your sentiment is right. We've seen that consumer sentiment came back up beginning mid-May. June looked better. July looks better. We still revised downwards internally our expectation for the U.S. sales because we just We just had to. And then, you know, obviously the FX effect was also not helpful. So overall, I'd say not the greatest year for our US experience. Plus, as I said, when the middle of changing the two companies into one and changing the way they do business. So that obviously also leads to a bit of distraction. But midterm, so next year, the year after, we're still very, very confident that we've done the right thing and working on it. And we see the margin expansion at least. And then, you know, once we're through with the business model transformation, we're going to see an uptick in U.S. sales as well.

Are you gaining or losing market share? Do you have any insights there?

We see, well, total US market share is... No, I mean in your region, sorry. I just wanted to say we're under 1%, so if we take the European levels, we still have 30% to go. We do see that our competitors are actually reporting higher organic sales or growth figures than we are. We're looking at that. We do see, you know, we're looking at day one conversion rates, which is one of the primary key indicators for us, which basically means how many people come out of the optometrist's office with a prescription and how many of those file it with us or leave, you know, immediately on the same day or how many leave and then come back or go somewhere else. We see that that number is actually pretty stable, slightly trending downwards, which would be an indicator for losing market share. Our biggest issue at the moment is doctor availability. So, you know, we're specializing on the more rural parts of the upper Midwest, which is great when you're there and you're running because there's a lot of competition. which is not so great if one of your doctors retire or leaves the area and moves to a city then it's very hard to attract doctors to work there and once you don't have doctors then you don't have a prescription and then that's not great for sales and that's currently The biggest issue now, we did a lot of hiring over the summer. We now have after Labor Day, which is, I think, next Monday or the Monday after next. We actually have the highest availability of doctor hours ever. So we expect the business to pick up. But yes, so far, we're seeing lower numbers in our numbers than what our competitors are reporting for the U.S.

Okay, so you did feel obviously the FX effect in that quarter, the translation.

Yeah, yeah, of course.

Okay. And for the group as a whole, my second question, please. I mean, you addressed it.

That was a very long first question. I know. I know. I'm sorry.

I'll be done. Group A Group B Group C I just wondered what underlined your optimism at this stage being in mid-August or end of August with that number.

Well, we're going to see a pickup in the U.S. sales, and we do have quite a few Campaigns on going on now, you know after the summer Coming out in our well in Germany and in all our markets basically I just you know this morning. I I had a forecast meeting with sales and you know and yesterday we really go through each country and say what are the activities we just closed out, you know, we talked about extensively about the July results and All of which I'm not going to share, but I'm going to tell you that, you know, nearly two and a half billion is what I see currently in the numbers that I have as a forecast for this year.

Okay, thank you.

Thanks for your question. Well, Mr. Abbott was raising his hand right in the beginning of your presentation. Making sure. That's how we know Craig. Okay, so we move on to the next participant. Mr. Rossi, you should be able to speak now and place your question, please.

Yes, good afternoon. I hope you can hear me well.

Yep.

Yep, thank you. So good afternoon, everyone, and thank you for taking my two questions. So the first one is just to come back on the U.S. So I heard that you were expecting a pickup in sales in the second half of the year. And I recall that during the call in May, you were saying that almost 85% of the margin improvement was coming from organic growth. So in a worst-case scenario, have you planned any contingency measures or mitigation measures in case of maybe a less optimistic scenario in case of a prolonged adverse consumer sentiment there? So that's my first question. And the second one is regarding the rollout of your teleoptometry platform. Could you share with us any KPIs of what you see in terms of customer profiles? Were you able to attract a new profile of customers or what's the conversion rate there? Thank you.

Sorry, the rollout of?

Yeah, your teleoptometry platform. you know, the high health checkups and so on.

Thank you. Definitely can talk about that. So number one, the US, if something happens and what are our mitigating measures? Well, first of all, we we know that the US is a big market and as a big investment for us and We definitely want to make it work We know that we are basically in the US Trying to change the way the Americans are going to experience visiting their Optometrists and their opticians so we know this is not a quick fix and we know it's going to take a while to do that So any mitigating actions we're going to undertake? cannot You know, harm or impede the long-term development of the business. So, you know, firing opticians is not on the menu. Firing doctors is not on the menu. Accelerating in making them more efficient is definitely on the menu. And that's why, you know, we're shipping quite a few people from from Germany to the US to consult and help there. As I said, you know, one strategy manager working there and our CSO basically being there to consult and to meet and to help and guide and do whatever you do as a board member when you're looking at your second largest market. And mitigating actions that we have are relatively limited in the U.S. In this case, we're still bringing together the two organizations. And yes, we took a rift, as you say, in the U.S., so a reduction in force. But we still see here and there people that we can let go, mainly in the back office departments like the insurance handling, the finance. We're becoming more and more integrated and working on that. So that's number one. and number two is marketing expenses where we're becoming a lot more selective in how we spend it and then and number three is being a little more careful in terms of you know expansion because obviously If we're in the middle of changing the business model and a new store is going to lose money, even in the US for the first 10, 11, 12 months, then it doesn't make sense to accelerate that expansion now. So also that we always said for the last one and a half years, at least that we said, look, We bought these two companies now. Let's bring them together. Let's make them work before we continue expanding on that. And that's what we're doing. So these are the three mitigating levers that we have and that we're actually pulling. The optometry platform, our eye health checkup, we showed that in the AGM. I think we also showed that in the strategy review recording that we posted in July. On our website, you see that, you know, we're getting to more and more customers are actually excited about that. And we're growing at quite tremendous rates, but that's because it's still a low level. But, you know, we are now at over 200 eye health checkups that we've done. In Europe, we're obviously doing all the stuff in the US where everybody has to see an OD before they get a prescription. But in the US, in Germany and Europe, we actually, you know, we're attracting a lot of customers. So far, it's mainly customers who are in store anyway. So we're not there yet that, you know, we see a lot of people coming in our stores and, you know, who have never been at a Fielmann. But quite frankly, that's very difficult in Germany because we have 56% market share in units. So, you know, finding somebody who's never been to a film on this is difficult for us, but we're happy with the development. We're going to expand it and we're definitely pursuing our idea of turning this into a pan-European platform for, you know, all sorts of opticians and yeah, and making good headway there.

Okay, very clear. Thank you, Stephen.

And we move on to the next participant. Ms. Gomez, you should be able to speak now and place your question.

Hi. Thank you for having me. Could I, very helpful clarification so far and Craig actually saw one of my questions, but if I could clarify on the marketing expanding. So it was a little bit higher in the first half. I understand that you were mentioning calling out some of the summer campaigns. that help give you confidence for the sequential acceleration we should see in the second half. Does this mean that marketing expense cost will be also sequentially higher in the second half to support that growth in the U.S. and also in your core markets like Germany? That would be my first question, just as a clarification.

Yeah. Well, I said that marketing costs in the second quarter were 8 million higher than in the first quarter because just of the phasing of those yeah of the campaigns and let me just if you're asking a specific question and I happen to have the file here let me just give you give me a minute I just look I just look it up so that I give you the precise number and then I don't lie which I shouldn't But we just look, we just finished the as I said, we just finished the forecast. And so far, we spent in marketing for the year, we spent 44 million first half year. and our forecast for the year is about is about 84 million so we're not going to see you know we're going to see targeted marketing expenditure but we're basically going back to first half year like second half year so 44 to 84 you know slightly less marketing expenditure which is a Which is obviously an answer to is a mitigating action to slightly, you know, less enthusiastic growth in our set.

Thank you. I appreciate that. And then if I could just go into the cash allocation priorities in terms of the dividend payout policy. We are seeing a reduction year over year. Just if you could give a little bit more color into the thinking in the short term I would assume there's a focus on obviously the debt payments that are there but any other insights would be helpful in terms of all you are planning for the rest of the year our dividend policies is we want to

have our investors obviously participate in the success and the growth of our company. We're looking at payout ratios of the profits attributable to shareholders in the 60%. We've been doing this last year. We've been doing this this year. We will be doing it, you know, usual caveats apply, but we will be doing this next year. We increased our dividend payout by 15% because our profitability grew by 15% from 23 to 24. So that's basically how we look at it. We say if the company grows and the profitability increases, then unless we do something major, we should be having our investors participate. In that, you've seen our leverage profile, you've seen our targets. So we have to be within our target range of leverage, we have about 0.9% or 0.8% of the dividends. in headroom so multiply this with 580 million in EBITDA that gives you the debt capacity that we have to you know should we do something so I don't really see that the dividend for the next years is under any imminent danger unless something really really really big comes along but so far we're pretty happy with the profile that we have I personally feel we're slightly at 1.1% We're probably at the lower end of our target range for leverage. So I think before we're cutting dividends, we should be increasing debt, which will better utilize our balance sheet that we have and that is super stable. That's how I look at it. So no imminent danger for your dividend payments.

I appreciate that. Thank you.

Well, thank you. And in the meantime, we haven't received any further questions. So everything appears to be answered by now. But should further questions arise at a later time, please feel free to contact Investor Relations. We therefore come to the end of today's earnings call. Thank you for your shown interest and a big thank you to Stefan for your presentation at the time you took to answer the questions. It was a pleasure to be your host today and I wish you all a lovely remaining week and with this Stefan I hand back over to you for some final remarks which concludes your call for today.

Well, we definitely want to have Ingmar more. We want to have more Ingmar than grumpy Germans on the call. So thank you very much, Ingmar, for being our host. Thank you all for joining. Thank you very much for your questions. Thank you very much for the continued dialogue that we have with each of you, you know, between meetings and conferences. I know that I sometimes have to be a grumpy German, but I definitely enjoy the exchange with you and you give us a lot of food for thought. You know that we've been changing the way we do investor relations over the last year. I hope this format is now great for you. We have Niels, who is a great guy, so reach out to him. And then we look forward to the next highlight, which is You know, a mere three weeks ago away, and that's on September 17th in Frankfurt. You can join us in person or online for our Capital Markets Day slash Analyst Day, where we are going to really, really spend a lot of time on your questions and be definitely on Vision 2035 and the targets for 2030. And we hope to see and hear you there. Thank you very much for your continued interest.