Axfood AB (publ)

Good morning, everyone. This is Alexander Bernd Rop, Head of Investor Relations at Axfood, and welcome to the Axfood Third Quarter 2025 Telephone Conference. So with me today, I have Simon Margulis, President and CEO, and Anders Lexman, CFO. In the investor section of our website, you will find the presentation materials for today's call, and we encourage you to have that presentation at hand as you listen to our prepared commentary. after the presentation we will be taking questions and recording of this call will be made available after the event on our website so with that i will now hand over the words to simone so please go to page number two thank you alex and good morning everyone oxford summarizes another strong quarter with high customer traffic volume growth and increased market share

With increased loyalty and growth in our store chains, as well as improved efficiency and solid cost control, earnings increased in all operating segments. In addition, we continue to invest in strategically important areas to become even more efficient and further improve our competitiveness. In recent years a logistics structure has been developed to enable continued profitable growth and during the quarter we announced plans to establish a new highly automated logistics center in Kungsbacka in southern Sweden. In sustainability we presented the food 2030 report, our proposal for a more sustainable food strategy for Sweden. We also continued to phase out fossil fuels in all our transports, had a new solar park in full operations and launched innovative new products focused on sustainability and health. Following that introduction, let us now turn to page three and the agenda for today's presentation. I will start with a brief market overview and then I will give you a review of our third quarter performance and some of our strategic priorities. Following that, Anders will take you through the financials and lastly, the outlook for the full year and a brief summary to conclude from me before we open up for questions. Turning to page four, but let's go straight to page five and take a look at the quarterly development. As in previous quarters, market conditions in Swedish food retail during the third quarter continued to be characterized by intense competition and high price awareness among consumers. Overall market growth amounted to 5.4%, and Statistics Sweden reported that the annualized rate for food price inflation was 4.4%. This was somewhat lower than in the second quarter this year, However, in absolute terms, compared to the second quarter, the price development was relatively stable. Axford is successful in navigating a changing market dynamic by leveraging the strength of our business model of strong and distinctive concepts working in collaboration. Thanks to affordable and attractive offerings, more and more consumers are choosing to shop with us. Having maintained our momentum, we delivered a strong performance in the quarter. Growth in our retail sales amounted to almost 20%. Excluding Citigrass, which was acquired in November last year, growth amounted to just over 6%. As such, our growth again was above the market rate, both including and excluding Citigrass. Volume growth from increased loyalty, customer traffic, and new store establishment was the main driver behind this development. In e-commerce, we grew 11%, which compares to the market growth of 8%. Excluding Citygross and the discontinued business Middagsfrid, sales were up 6%. Turning to page 6. Consolidated net sales for Axford grew almost 7% in the quarter, driven by continued strong momentum in Willys, Hemköp and Snabgross. We also saw a positive trend for Citygross. In all, Citigrass net sales amounted to just over 2 billion SEK. However, on a group net sales basis, the contribution from Citigrass was 345 million SEK, due to internal eliminations in Dagab. Please go to the next page, number 7. Group operating profit increased to just over 1 billion SEK, and the operating margin was stable at 4.8%. Operating profit included items affecting comparability of minus 39 million SEK related to CityGross. Adjusted operating profit, which exclude these items, also increased to 1.1 billion SEK and the adjusted operating margin was higher at 4.9%. In all, the absolute growth in group operating profit was driven by Willis & Dagab, However, Hemsköp and Snabgross also reported increased profits year on year with strong growth in percentage terms. So the earnings performance was once again very well balanced this quarter across our operating segments. Citigrass had a negative impact on the group's profit development, however to less extent than in the previous quarters. Let's now go deeper into the development in each operating segment. starting with Willys on page 8. Willys continued to outperform the market in the third quarter with a growth of 6%. Growth primarily came from higher volumes as a result of an increased number of customer visits and new store establishments. A higher average ticket value also had a positive impact on the sales development. Willys is Sweden's most recommended food retail chain and has a unique position on the market. The rate of increase of new members in the Willis Plus loyalty program continued to be on a high level. And in addition, loyalty among existing members remained strong. Earnings grew and amounted to 587 million SEK, which correspond to a stable operating margin of 4.9%. The increase in operating profits was primarily driven by the increased sales volumes, a stable gross margin development and good cost control. Leveraging its position as Sweden's leading discount grocery chain, as well as its liking among households, Willys is continuing to develop its offering. Among many initiatives, stores are continuously being upgraded to the new Willys 5.0 store concept. Willys 5.0 entails a significant improvement to the customer experience through a substantial upgrade of store layout and design. The assortment is key and here the focus is really on enhancing the offering of fresh products. Willys 5.0 is a scalable concept which gives flexibility and opportunities to establish more stores. Because establishing new stores, this is exactly what Willys wants to do. As the store chain is currently accelerating its expansion pace to reach even more consumers. In October, Willys reached a significant milestone when it opened store number 250 in Rosengård in Malmö. Over the past 10 years, Willys had expanded store base with more than 50 stores on a net basis. And now the aim is to open at least 10 new stores each year in the coming years. Moving on to Hemköp and page 10. Hemshop's retail sales growth of 6% in the quarter exceeded that of the market, and like-for-like growth was also strong at almost 5%. Hemshop demonstrated volume growth driven by customer traffic. A higher average ticket value also impacted the sales development positively. Total net sales for Hemshop increased 7%. Operating profit was higher at 103 million SEK, and operating margin was 5.1%. The increase in operating profit was mainly driven by the increased sales, a stable gross margin and good cost control. Turning to page 11. I just talked about Willys modernizing its store base and Hemshop is also modernizing stores at a rapid rate in order to enhance the customer meeting. In addition, its offering is continuously being developed with a focus on price value, fresh products and meal solutions. Hemshub's performance in the third quarter was strong, representing a continuation of its momentum for some time now. This development is despite them operating in traditional grocery, which is a segment that, while being the largest on the market, has seen its share of the market decline in recent years. It's important to take this into account when analyzing Hemshub. And it is quite clear when you look at the customer data, such as development in penetration, in loyalty and purchases, The PEM köp is clearly outperforming their main peers. We are now on page 12. We acquired Citigrass nearly a year ago to create new growth opportunities for our group. The organization is working according to a clear plan and has a comprehensive development agenda in place to reverse the chain's weak performance in recent years. This year is a transitional year and we are today reiterating that we expect to reach profitability at some point in the second half of 2026. While total growth of Citigrass in the third quarter was impacted by store closures, like-for-like growth amounted to slightly more than 3%. Citigrass reported on an operating loss on an adjusted basis of minus 4 million SEK. The loss was less negative than in previous quarters, with positive effects from like-for-like growth. In addition, structural measures and efforts to streamline operations also contributed to the development. On a reported basis, operating profit amounted to minus 43 million SEK, which corresponds to an operating margin of minus 2%. This included items affecting comparability of minus 39 million SEK pertaining to structural measures, including discontinuation costs for the store in Kungälvskurva in Stockholm, organizational changes and sales currents within the non-food assortment. In August, the new communication concept and the improved, more affordable customer offering was further developed. Also, the Citygross store in Borlänge was closed ahead of concept change to Willys. Turning to page 13. The 3% growth in like-for-like sales for Citygross represent a positive trend. The chart on this slide shows comparable sales on a rolling 12-month basis, each quarter from the third quarter 2022. As you can see in the chart, after a couple of years with declining sales, Citygross is now back to growth, which of course is encouraging. That said, we're still in early days, on our journey with Citigros and maintain a high activity level to enable the chain to become a competitive player on the market once again. Citigros has excellent potential as a pure play hypermarket operator, an attractive segment that is continuing to account for a growing share of the market. With a long-term perspective, we are leveraging our knowledge and experience to develop and strengthen the chain for the future. Moving to slide 14, our restaurant wholesaler, Snabjos, delivered growth of 6% in the quarter on both a total and like-for-like basis. Higher volumes through increased customer traffic had a positive impact on sales, in addition to a higher average ticket value. Operating profit was higher than in the prior year and amounted to 101 million SEK, corresponding to a higher operating margin of 6.3%. The increase was mainly driven by higher sales, a stable gross margin, and good cost control. Next page, number 15, and Dagab. Dagab's quarterly net sales increased by 5%, driven by sales to Villis, Hemsköp, and Snabyos. Operating profit increased to 341 million SEK, and the operating margin was higher at 1.7%. The performance was primarily due to the sales growth and a lower cost level with increased productivity in logistics. Operating profit was however negatively impacted by a lower gross margin. Dagab is continuing its effort to optimize the flow of goods and streamline the group's new logistics structure. The logistics center in Bålsta, the fruit and vegetable warehouse in Landskrona, and the recently expanded and automated high-bay warehouse in Backen, Gothenburg, are all contributing to the group's capacity and efficiency. In addition, and we are now on page 16, work on establishing a new highly automated logistics center for southern Sweden has been initiated to ensure increased capacity and efficiency. As previously communicated during the third quarter, letters of intent were signed with our automation partner, Vitron, and with Kungsbacka Municipality. The logistics center, which will stand approximately 90,000 square meters and be environmentally certified, will handle picking and deliveries of goods in all temperature zones to grocery stores. Total capacity is expected to increase at least 20% compared to current volumes in the southern Sweden. The facility is expected to be put into operation starting in 2030. Turning to page 17. Now it's time for Anders to take you through the financials. So please go to the next page, page number 18. And Anders, please go ahead.

Thank you, Simone. During the first nine months, net sales for the group increased by 6.6% to approximately 66 billion SEK. Including Citigrass, retail sales increased by 19.3% and excluding Citigrass, the increase was 6%. which was more than the food retail market in total, where growth amounted to 4.5%. Operating profit excluding items affecting comparability increased 5.8% to just over 2.8 billion SEK. The operating margin excluding items affecting comparability slightly decreased from 4.3% to 4.2%, where the CityGross acquisition impacted the margin with minus 0.3 percentage points. Next, page number 19. During the third quarter, the cash flow was minus 40 million SEK, which was 380 million SEK higher compared to last year. We saw a strong underlying operating cash flow both for the third quarter and the nine-month period. mainly due to a less negative contribution from net working capital compared to last year. The negative calendar effect was higher last year. The negative cash flow from investment activities of 421 million SEK in Q3 was somewhat higher compared to last year, but in line with previous quarters. We have a higher pace in our investments in our retail operations and a lower pace in automation investments compared to last year, since we now are through with our investment in the fulfillment center in Bålsta. By the end of the third quarter Exford utilized approximately 3.1 billion SEK of the group's credit facilities compared to 2.5 billion SEK by the end of Q2 and 3.2 billion SEK at the end of Q1. The increased utilization compared to Q2 was due to the dividend paid out in September. And then please turn to page number 20. Net debt has increased since the acquisition of Citigrass in Q4 last year. In addition to the loans raised for the acquisition, net debt also has increased with the Citigrass leasehold debt of approximately 2 billion SEK. As we communicated in the Q2 report, Exwood has successfully refinanced the existing revolving credit facility in the beginning of Q3. The new RCF amounts to 4 billion SEK, where 1 billion SEK have a term of three years and 3 billion SEK have a term of five years. And the conditions in the new agreement are in all essentials unchanged compared with the old facility. The equity ratio amounted to 20.2%. 4%, which was lower than December 2024, but above the actual year and target of 20%. The lower equity ratio compared to Q3 last year was also a result of the Citegross acquisition. Total investments excluding leasehold and acquisitions for the first nine months amounted to 1.3 billion SEK. Year to date, we have established seven new Groupon stores, the same number as in the prior year. We have however increased our store modernization rate compared to last year. And then please turn to page number 21. When we look at the capital efficiency we have a negative development of our rolling 12-month networking capital as percentage of sales. As I have mentioned before the impact of Citigrass acquisition is expected to increase this KPI with approximately 0.3 percentage points on a rolling 12-month basis. Capital employed has increased over the last years, mainly due to both the acquisition of Bergendals Fod and Sittergross, as well as the investments in Bålsta. The level of capital employed increased slightly during the first nine months, mainly as a result of increased leasehold debt and utilization of credit facilities. Due to the increase in capital employed, return on capital employed decreased somewhat compared to last year to 16.4%. And thereby, I have come to the end of my presentation and I hand over to you again, Simon.

Thank you, Anders. We are now on page 22, but let's go straight to page 23. While we maintain our full year outlook for capital expenditures, our store expansion plan is slightly revised. Due to a slight delay, the number of new group-owned stores opened during the year will amount to nine. In addition, the store network is expanded with three retail-owned stores joining the network from competing retail chains. As for items affecting comparability, structural costs in Citygross are now estimated to amount to SEK 150 million. As a reminder, the outlook for next year, 2026, will be presented in conjunction with the release of our year end report. Please now turn to page 24. So let me summarize. We are summarizing a strong third quarter with higher growth than the market and improved earnings in all operating segments. Just over a month ago, we held a capital markets day at which we discussed how our business model and structure create opportunities. We also laid out our main competitive advantages, and I would like to mention them here again. First, with our brands, both in store concepts and product labels and a high quality affordable assortment, we are well positioned to meet consumers diverse and evolving needs. Second, we have attractive store locations and a significant potential to expand. Third, our integrated value chain provides the right conditions to quickly adapt when customer behaviors or market conditions change. And it also gives us efficiency. Fourth, to us, the key to drive long-term growth and profitability is based on customer traffic, loyalty, and volume growth. We have seen a strong development in all these areas over a long period. And with our scale, we can further strengthen our competitiveness. Our performance in the third quarter really shows how we drive growth in all segments on the market, both organically and through expansion, and how our integrated value chain gives us efficiency. The strength of our business idea enable us to continue to challenge and grow. We are maintaining a high rate of development, and I am convinced that we are poised to strengthen our market position in the years ahead. That was all for today. Now please turn to page 25 and I hand over to the operator to open up the line for questions. Thank you.

If you wish to ask a question, please dial pound key 5 on your telephone keypad. To enter the queue, if you wish to withdraw your question, please dial pound key 6 on your telephone keypad. The next question comes from Frederick Iverson from ABG. Please go ahead.

Thank you, operator. Good morning and thanks for the presentation. I have two questions. First, if we could dig into the margin profile in villas a little bit. I guess Q3 tends to be quite a bit stronger than the other. quarters especially Q1 and Q2 but now it's been almost in line with the previous two quarters for two consecutive years and I know you took some price investments last year but in addition to that I guess has the market been has it been even more campaign driven during the summer months or do you see anything else that sort of explains why the normal margin uptick that we usually see in Q3 didn't really materialize this year.

Yeah, thank you for your question. As you said, there are some seasonal effects and also the mixed effect also have an impact on the margin wheelies. But I would say to start with, wheelies have a stable margin development, even though there's a really high competition in the market. And we have a customer that is pretty much in the same behavior as we've seen the last year with a strong focus on price and with a high a high price activity level in the market. So by that, we still have, we continue to have a stable market development in Willys, which we are really happy to see. And one thing that is also affecting a little bit on the bottom line for Willys is that we are We have a high expansion rate in Willys. This year, until September, we have opened up seven new stores for Willys compared to four last year. And by that, we see some... The margin gets some... It dilutes in the margin because we get higher personal cost when we open stores. And then it usually evens out...

after a couple of months but but when we open many stores uh we have some more personal costs uh the staff cost for staff uh during the first until until you get up in a growth rate in the stores okay thanks that makes sense um and second one on city girls you have been talking about earnings getting back to black figures in the second half of 2026 and and now you sort of reiterated that statement, but you were almost there already in Q3 this year, although on an adjusted basis. Has the progression in city growth been stronger than you expected before, or was this more or less according to plan, so to say?

would say we are working according a comprehensive plan to turn around city girls both to to to create growth uh since it all starts with a growth in like for like sales uh uh so so i would say we're pretty much following our agenda for city girls there are some season effects also in the hypermarket segments during q3 so i would say since we are we are This is a journey and we say something will go up and it will go down. We are here in the long run to create a really strong format in the hypermarket segment. So I would say we are not ahead of our plan. We are following our plan. So we reiterate our guidance. for the second half of 2026. However, we are really happy to see these positive signs, primarily on the like-for-like sales, I would say, because that's where it will start. And then, of course, that we see the results of the initiatives that were made to decrease the cost level. Of course, we're really happy to see that we see these positive signs. But we are according to plan, I would say.

Okay. Thank you. And maybe a short follow-up on the like-for-like growth. I recall you did some price value investments. Would you care to give sort of a ballpark figure on the volume growth in the quarter?

I would say we have a comprehensive agenda regarding the growth. And it's all about developing the... offering both the assortment, but as you said, also to strengthen the price position. It's also about how we do the marketing, the campaigns. It's about operations in store. And I would say that it's a mix of growth and price. But as you said, we are strengthening the price position in Citigrass. And by that, the majority is driven by volume.

Okay, good. Thank you.

Thank you.

The next question comes from Gustav Haggeis from SEB. Please go ahead.

Thank you. Good morning. Thanks for taking my questions. I'll take over from the last statement of yours that you had primarily volume growth in Citigrass in the quarter. And if I read correctly, that was the case also for Willis and Hemshapp. which is a bit contradictory to the market growth, which appears to have been four out of five percentage points in the quarter in the market was inflation. And you say that you've primarily driven your growth through voluming, given that you're 25% or so of the market then. It appears then that you've price invested compared to the market quite a bit here in Q3 or so. Or are we talking different numbers that don't really add up here?

Yeah, I understand it's difficult for you to see, because what you can see is the SCBF figures on inflation, and that consists of a basket that is set once a year, and it's not changes over the years. So they set the basket once a year, and then they could, how to say, differentiated volumes. However, when we look in the price factor, internal figures, it's a gap between those figures. And I will not be able to say our figures, but that has been the issue for all times, that we don't really see the same internal figures on pricing than SLBA is reporting.

Okay, but then on a general topic question then, given that the margin seems a bit under pressure and also your comments on much price action in the market and price competition, is your view that you've lowered prices in the quarter and more so than competitors, regardless of what the FCB figure is?

No, I would say, I mean, I normally don't go into details about our price strategies, but for us, it's always about securing our price positions in the market, where Willys, of course, is the cheapest on the market. And also HempShop, it's important to be really price attractive. And we see really good, how you say, development in the, that's what I wanted to show you also, the customer figures about HempShop, really. taking notice of the price position that they have changed during the years. So the only way, of course, it's about for us always to be competitive in the market, but within Citigrass we made the price investment that we talked about both in August and in April. So for the other formats, it's all about to always to be competitive in the market. But I would say the margin for both Hemshöp and Viljus has been stable during this year.

Sure, but turning then to DAGEP, just help us understand what the underlying development is here. If I recall correctly, you called out 11 million extraordinary costs for Midas Feed and another 20 million or so for ramp-up costs for the new facility last Q3. Just to understand, when looking at DAGEP's development here, if you were to add back those figures to the comparable, EBITDA is flat or actually a little bit down year over year and you have called or guided the market for up to 300 million in savings on a yearly basis once fully ramped up in Daga and you're not there but it would be very helpful if you can help sometimes. First of all if that base is correct so that operating earnings are basically flat or slightly down for Daga and secondly if you have how far you've come on that journey towards 200-300 million savings on an annual basis for Dagab and where that money went. We know that margins in Citigroup for instance are quite much better than consensus here today.

Yeah, thank you. For Dagab we are realizing the efficiency gains both in Bålsta And also in Landskrona, our fruit and vegetable warehouse. So we see that the productivity is increasing and we are realizing the efficiency gains of the early community span from 200 to 300 million SEK. And we are in the lower, on a yearly basis, and we are in the lower span, 200 million SEK. However, we both have a negative margin development in Dagab due to mixed effects. the gross margin, I mean, gross margin development in Dargab due to mix effects. And that is because Dargab is supporting the chains in their role in the market. And also we have some product mix that is affecting the gross margin negatively for Dargab. So we see the positive effects in Dargab in realizing the efficiency gains and the productivity, and then we have a negative effect on the gross margin.

But is the mixed effect explaining then the 50 million negative underlying development for DAGAP? You have volume growth, right? So it should be some type of uplift. Or is that going into some of the other retail concepts like city growth? It would be, I think, very helpful. Since you have that break-even target on city growth, I think it would be helpful to understand how much of that is actually just transferable from DAGAP and how much is sort of underlying improvement for city growth.

So the gross margin development in Dargav consists of a different part as I explained. First, the mixed effect, which is a negative because we have deflation in fruit and vegetable that is affecting the gross margin in Dargav negatively. Dargav is also supporting the chains, and that is what we see on the negative side. We're realizing the efficiency gains in Dargav, both in Boston, the fruit and vegetable, Okay, so last one.

Sorry to dwell on this, but I think it's quite important since you have the target to go break even in Citigroup and you have guided for up to 300 million savings in DAGEB. Do you expect DAGEB to showcase any of that? those savings into Q4 next year, or is that going to go into the other concepts, and how do you distribute them then between, you think, DAGEP and City Girls and Wheelies, just to get a feel of what's going on on the line?

For us, it's about leveraging our business model, and that's about growing as a group in a whole. And we do that by having strong store concepts, growing like for like, and total sales. That gives us volume in the behind, and then it becomes more efficient. So for us, it's really important to do the long-term investments we do in our logistics structure so we can be competitive over time. The efficiency gains, you don't maybe won't see them in DAGAB as a whole. You have to look at us as a group in a whole. So for us, it's really important to grow like for like sales in Citigrass. And then to have growth in all our segments. And this quarter we show growth in all segments. We show increased operating margin in all our segments, which is a really positive. And that's make a summarize a really strong quarter. So for us, it's about leveraging our business model and also playing the game with our competitive edges. And that I think that this quarter shows really that we're doing.

Okay. Thanks for taking my questions.

The next question comes from Magnus Rahman from SB1 Markets. Please go ahead.

Thank you very much. I'd just like to ask on the price and inflation topic again, because now you state that you see a bit different numbers internally, but if we just relate to the SCV stats, we had a food price inflation that rose in the early spring this year, an index level that came up and thereby also year-on-year inflation. However, this index level and the inflation rate has come down sequentially in the recent two months. And if we look ahead and if we just assume this an unchanged index level, come to very low inflation rates entering next year and then we have the halving of the VAT in April. From this perspective of food prices I'd like to ask firstly if you see those price changes can be driven both from changes in your procurement cost and also from competitive pressure. Do you view that the decrease in prices that we've seen in the recent months have been driven by reduced sourcing costs, or is it an increased price pressure that you see in the market?

I would say that the inflation, even though we don't see the same figures as S&P, we see the same trends within our internal figures. I'd just like to clarify that. But the trends that we see is driven by the... the sourcing, the price fluctuations that we see in our sourcing. So as you said, we have a shortage in the market on red meat, also in dairy, and that increased the prices in the beginning of the year and continue during the year. And then we have a deflation in fruit and vegetables that has come down because of the sourcing prices. And I would say that it's pretty much what you see in the market changes in the pricing. And then if you look into the VAT, as you asked, of course, we see positive on the VAT because we have a consumer that has been under pressure for many, many years. So by reducing the VAT in Sweden, we create consumption spam for the consumers. And of course, that will be positive. How that will affect us volume-wise, it's really, really difficult to make any forecasts on. So we better come back to that when we implement the new VAT level in April next year.

Right. But there was a question also previously about underlying volume. And I guess that maybe it's good to clarify that underlying volume growth could not only be driven by sort of an increase in the number of units. It could be a mix shift when people trade up. If they buy more meat, sort of more higher quality type of meat, then you get an implied volume growth, but it's not more calories consumed. It's a higher sort of shift up in mix toward the premium. And this, I mean, with the halving of the VAT, I guess it's fair to assume that we would see some type of mix shift that could contribute to your margin and profitability.

to make forecasts about that but I would just say that when we talk volume we talk volume and when we talk mix or price it's different things so when I say volume I don't talk about mix I would just just clarify that so but of course we're hoping as we see that the volume goes up in within fruit and vegetables when the prices comes down we are hoping to see a little bit more how to say the the the share of the more sustainable food to increase. We hope for that, but it's very difficult to make any forecast about it. It's really possible for the consumers to have a larger consumption share.

To conclude, the overall gross margin improvement that we see clearly on the group level both in year-to-year terms in Q3 and in year-to-year terms on the nine-month rolling or nine-month-to-date basis, is, in your opinion, predominantly driven by a relief in the sourcing costs rather than a relief in the price pressure in the market.

Now you said the development of the margin. That was not... You asked about the price. So to start with the... Anders, sorry.

Yes, sorry. Magnus, the gross margin that you see in our report is not the same as the gross margin that we see in our change and in our stores because it's... It's how to disclose and report the COGS. It's a different way.

Yes, I know that we have to wait for the annual report to get the product margin. Yeah, what I'm trying to get at is that there should be, if you look at the overall sourcing costs from an FAO index perspective, for example, we see that we should not expect an increasing pressure, rather a relief in the source of pressure. And with the items that you mentioned that goes into the cross-border, for example, diesel prices for transportation and so on, that is also points to a relief rather than an increased pressure.

But this leasing pressure also obviously affects the prices in the stores. I mean, they follow the way out in the stores.

Yeah, exactly. And I mean, the indexation of rents should be flat, if anything, entering 26, I guess, with the inflation rate we have now.

Yeah.

What happens in 26, we have to come back to. Right. Okay. I will settle with that. Thank you. Thank you.

As a reminder, if you wish to ask a question, please dial pound key 5 on your telephone keypad. There are no more questions at this time, so I hand the conference back to the speakers for any closing comments.

So I would like to thank you all for joining us today, and I hope to see you in next