BHG Group AB (publ)

Thank you, operator, and good morning, everyone. Moving to slide three, please. The final quarter of 2020 continued much in the same strong vein as the previous two quarters. Adding the acquisition of NordicNest in December to the picture caps an exceptional and transformative year for us. With the acquisition of NordicNest, BHE has essentially reached the mid-term financial targets we communicated in conjunction with our IPO in March of 2018. including becoming a 10 billion SEC business. As a consequence, and to reflect our continued journey, we're updating our financial targets this morning, more on which later. Fourth quarter performance demonstrates that demand has remained strong, characterized by solid growth in our home furnishing business, but powered especially by outstanding growth in our DIY business. Today, we'll start by reviewing the results highlights, then move on to the business and financial updates before summing up and launching into the Q&A session. I'll kick it off, and I'll then hand it over to Jesper to cover the financials before I summarize, and we move on to the Q&A. Slide five, please. Please note that none of these numbers, nor the ones on the subsequent slides, include NordicNest, since we consolidate the P&L of NordicNest only from the 1st of January this year. Growth accelerated somewhat compared to the third quarter. Total growth amounted to 43%, and organic growth to 36%. Net sales reached 2.4 billion SEC. Adjusted EBIT came in at 194 million SEC, corresponding to an adjusted EBIT margin of 8.2%. More than 200 million SEC in cash flow from operating activities was generated in the quarter, and so cash flow for the full year almost touched 1 billion SEC. The underlying performance drivers in the quarter were similar to those of the previous two. Consumer interest in online shopping in general, and in home improvement specifically, has remained on a high level, and BHE has been well-placed to capture the resulting demand. Both segments, again, performed well, with the home furnishing segment now delivering robustly for a ninth consecutive quarter, while the DIY segment continues to be the most clearly favored by the strong trading conditions since the second quarter of 2020. Our two largest platforms within DIY, BigHema.se and BHG Finland, accelerated further compared to the third quarter, growing by some 40%, while some of our niche private label-based units again grew at truly exceptional rates. We reiterate that we expect a reversion to more normal trading conditions, but once again, we note that trading has remained strong thus far into the new period. Slide six, please. We continue approaching growth through a mix of organic initiatives and M&A. When it comes to the organic components, we're now reporting our fifth quarter in a row with growth above the 15% level, our communicated target over a business cycle. With a 35.5% organic growth over the fourth quarter, the full year 2020 came in at an organic growth rate of 33.7%, which was comprised by the home furnishing segment growing 30%, and the DIY segment growing by 37%. Slide seven, please. Our strategy remains focused on our four cornerstones. Firstly, the continued expansion of our leading product range, which now stands around the 1 million SKU mark. Secondly, scale and a high share of own brands in our sales mix, with full year growth at 44%, not least fueled by our private label range, and as evidenced by the gross margin trajectory, we continue building scale advantages. Thirdly, creating the most appealing shopping experience and leading in the digital realm, we grew our digital footprint significantly in the quarter, resulting in visits to our destinations exceeding 300 million for the full year. And fourthly, offering the market's best professional guidance, service, and support, including in the quarter further extending the reach of our installation network within DIY, as well as our own last-mile delivery capabilities on the home furnishing side. This is our ecosystem with the product offering at its base and the customer always at the center. And finally, an integral part of our execution approach includes leveraging our M&A capabilities to accelerate both growth and strategy execution. Moving on to the business update, so turning to slide nine, please. As we enter our ninth year since inception, some key metrics describing who we are today at a glance. On the left-hand side, Our CAGR since 2014 exceeds 40%. In this period, EBIT has grown by more than 100% per annum. Our EBIT margin on an LTM basis stands at 7.8% and is generated by our over 80 customer-facing web properties. And now moving over to the right-hand side, these web shops have been visited over 300 million times in the past year, creating some 3 million orders from customers in 19 countries across Europe. And finally, our product portfolio is leading in terms of its breadth and depth. Slide 10, please. We announced the Nordic Nest acquisition on the 13th of December. Nordic Nest is a leading online player with a focus on the affordable luxury segment for tabletop, lighting, interior design, and other smaller home furnishings items. The business, which in round numbers turns over 1 billion SEC today, has customers in many European as well as international markets. The largest geographies are the Nordics, Germany, the UK, and South Korea. We're convinced that the combination of BHE and Nordic Nest is a winning one. From a customer, product, and geographical perspective, we now cover the full spectrum, from value for money to affordable luxury, and from large furniture, such as beds and couches, to table decor and design. The geographic footprint of the group has also significantly expanded. And last, but not least, the cultures of BHE and NordicNest are a perfect match, with a strong focus on profitable growth, cost control, and customer centricity. Slide 11, please. As I've already mentioned, adding the billion-second sales from NordicNest, we're now within touching distance of the 10 billion sec in net sales that has been our target since early 2018. The time has come to raise our sights and stake out the path forward. With us announcing updated medium-term financial targets, these reflect our strong vantage point in markets that we are convinced will continue to grow. We're setting out to double the business again from 10 to 20 billion SEC. We reiterate that this trajectory will follow from combining organic growth at least in line with the market with acquisitions to deliver a combined growth in the 20 to 25% range per annum. The new profitability target is to achieve an adjusted EBIT margin of at least 7%. The past year demonstrates that 7% does not represent the ceiling for what the business can deliver. However, we are in a growth phase, and we will continue to focus on growth. We will not compromise on this by prioritizing profitability at a higher level than the established target. The capital structure and dividend policy targets remain as before. Moving on to slide 12, please. Our business model combines a multi-brand approach with acquisitions, both of which help maximize our digital footprint and result in a customer base that is both broad and attractive. As we stated a couple of quarters back, we're step-by-step increasing the granularity with which we communicate customer developments. Our ongoing acquisition agenda, however, means that our consolidated internal data today covers the main platforms rather than the complete BHE universe. With this said, as you can see on the bottom left-hand side, we've seen a steady increase in the number of active customers during the year, reaching well over 2 million. This represents a growth in active customers of more than 50% year-on-year. A few words on this customer base. The largest cohort consists of customers who are active in the labor market and in their prime when it comes to improving home environments for their families. We have a roughly 50-50 split when it comes to gender, with men being more prevalent within DIY and women within home furnishing. On the bottom right-hand side, we show how the delta between our fully loaded gross margin and marketing investments keeps expanding. The significant increase in gross margin is the result of both pricing diligence, operational efficiencies, and the growing share of net sales from our own brands. The slight increase in marketing to sales, which at 5.7% is still at market-leading levels, is connected to the increase in net sales from our own brands. The net result of these developments includes very attractive customer acquisition metrics with a strong return profile already on a new customer's first purchase. We're committed to constantly enhancing the customer experience, a commitment which was put to the test during the exceptional demand peak of the second quarter. We've cut lead times, and we've clawed our way back since then. We will continue investing in systems and in processes to ensure that we meet or surpass our customers' expectations. I'll now hand it over to Jesper who will walk us through the financials in more detail.

Thank you, Adam. As we now put the fourth quarter behind us, we can see that a high level of growth has been maintained. The patterns from the second and third quarters of the year were largely repeated in the fourth, even on high growth in the home furnishing segment and accelerated growth in the do-it-yourself segments. As Adam mentioned, net sales increased 43.2% to reach 2.355 million SEK and organic growth reached 35.5%. On the back of continued favorable market conditions, we reported the strongest EBIT and EBIT margin for a fourth quarter to date, reaching 194 million SEK, which corresponds to an EBIT margin of 8.2%. The high adjusted EBIT margin was the result of, one, a favorable price and product mix, including a continuously growing private label share of sales in the due to self-savings. Two, operational leverage in fulfillment, logistics, and SG&A due to high growth. And three, positive currency effects, which I will get back to. Moving on to slide 15. Turn to some of the sales drivers in the quarter. Similar to the performance in the second and third quarter, the continued strong trading conditions led to a strong growth in the number of visits to the group's destinations, which increased by 53% to 78 million during the quarter and generated 865,000 orders. Although the trend in the number of visits to the group's destinations was strong, the conversion rate increased somewhat compared with the year-earlier period, As in the two preceding quarters, a chain product mix resulted in a lower AOV than in the year earlier period. However, as the record high gross margin for the period demonstrates, the decrease in AOV did not have any negative effect on earnings since an advantageous AOV structure could be maintained in relation to the delivery options relevant to a given category. In other words, The AOV for bulky products, which are sent on pallets, remained high, and the high growth for small parcels could be managed by delivering to service points. Slide 16, please. As a result of continued strong market conditions and the group's position, profitability for the quarter was very high. Strong top-line growth at 43.2% resulted in strong operating leverage translating to a gross margin increase of 54.8% and an EBIT increase exceeding 100%. The gross margin improved by 2.0 percentage points to reach 27.2%, exceeding the previous record that was set in the preceding quarter. The product margin amounted to 38.4%. Just as in the third quarter, the gross margin improvement was driven by a growing share of sales from our own brand, continued focus on maintaining the price points for bulky products, additional cost and process efficiencies in purchasing and logistics, and finally, positive currency effects from the stronger SEC, resulting in a favorable impact on the gross and EBIT margin by 0.9 percentage points. Let us now turn to our do-it-yourself segment, slide 17, please. The do-it-yourself segment closed the year with strong growth and exceptionally high profitability. Net sales grew by 49.4% to reach 1.439 million SEK, of which organic growth amounted to 39.4%. The segment platforms in Sweden and Finland continued their strong trend from the previous quarters. At the same time, The Danish operations, as well as a number of the more specialized operations in Sweden, particularly those with a high private label share of sales, grew very strongly. Profitability in the do-it-yourself segment was favorably impacted by a higher share of sales from our own brands, and both gross and EBIT margin reached record high levels. The gross margin improved by 2.0 percentage points to reach 25.1%. Adjusted EBIT amounted to 143 million SEX, corresponding to an EBIT margin of 9.9%. During the quarter, we continued to develop our customer offering, including the continuous expansion of the product range, expanding the base of products for which consolidated delivery is offered, and a further rollout of installation services. The installation platform has now been introduced in the Finnish market. Slide 18, please. The home furnishing segment is now in its ninth consecutive quarter of strong growth and solid margins. Net sales in the home furnishing segment grew by 34.7% in the quarter, reaching 923 million SEK, of which organic growth amounted to 30.1%. Net sales were strong and even across all geographical markets, led by the category specialist Lampgalerian, which reported growth rates of nearly 100%. However, net sales were somewhat negatively impacted by bottlenecks in certain areas of the product supply chain, not least as a result of the shortage of foam for upholstered furniture throughout Europe. The stricter Danish restrictions also had a certain negative impact during the final week of the year. The gross margin improved by 2.4 percentage points to reach 30.3%. Adjusted EBIT reached 63.6 million second a quarter, corresponding to an EBIT margin of 6.9%. The somewhat lower EBIT margin for the quarter is attributable to Transaction costs relating to the acquisition of Nordic Nest. The relatively high cost of online marketing in Eastern Europe, which in turn were linked to product bottlenecks and associated delays between order intake and invoicing. As well as changes to the Danish warehousing infrastructure. Let us now turn to cash flow, slide 19, please. Cash flow from operating activities for the full year amounted to 994 million SEK, corresponding to a cash conversion in relation to adjusted EBITDA of 105.9%. The main drivers behind the strong cash flow was the group's EBITDA, as well as a favorable working capital trend. The right-hand graph showing the development in liquidity walks us through the start and period positions of 270.3 million SEK, adding the cash flow from operations, deducting impact of investing activities, a majority of which is M&A related, and the most related to Nordic Nest. And finally, the financing activities, which again, primarily related to Nordic Nest, in the form of a new term loan of 1 billion SEK, but also include amortization of leasing liabilities. bringing us to the period end of 299 million SEK of liquidity at hand. Slide 20, please. The group's net debt amounted to 1.8 billion SEK at the end of the quarter. Despite the acquisition of NordicNet, our strong year-to-date operating performance meant that net debt in relation to LTM-adjusted EBITDA ended at 2.2 times within our medium-term financial target range. Our financial position is strong. On top of our liquidity at hand, we had unutilized credit facilities at the end of the quarter, or 300 million SEC, which means that we can continue to execute both organic and inorganic growth initiatives. Hanging it back over to you, Adam, to summarize and conclude.

Thank you, Jesper. So summarizing on slide 22, Q4 caps a transformative year for us with stellar growth, profitability, and cash flow generation. We're reporting a fifth quarter in a row with a wealth target growth. Nordic Nest joined us and now constitutes a new vertical within our home furnishing segments. Our gross and bottom line margins are at industry-leading levels on the back of sound mix development and strong operational control. Strategy execution is in motion, revolving around our four pillars which make up the BHG ecosystem. And finally, on the back of having come within touching distance of our previously communicated financial targets, We're today staking out the path forward, including targeting to reach 20 billion SEC in the medium term. Thank you. This concludes our presentation, and we now open up the call for questions.