DP Poland (LSE:DPP) — Interim Results for the Period Ended 30 June 2023

0:00 Good afternoon, ladies and gentlemen. Welcome to the DP Poland PLC Interim Results Investor Presentation. Throughout this recorded presentation, investors will be in listen only mode. Questions are encouraged. They can be submitted at any time via the Q and A tab that's situated on the right hand corner of your screen. Please just simply type in your questions and press send. The company may not be in a position to answer every question it receives during the meeting itself. However, the company will review all questions submitted today and publish responses where it's appropriate to do so, and these will be available via your Investor Meet company dashboard.

0:32 Before we begin, I would like to submit the following poll. And I would now like to hand you over to the executive management team from DP POLAND PLC. Nils, good afternoon, sir. Good afternoon. Thank you very much for the introduction. Thanks everybody for your time today. I really appreciate it. Today, we'll have myself. I'm the CEO of the Domino's Pizza Group in Croatia and Poland, and we have Edwards, our CFO, our group CFO as well. Afternoon. Okay. So we'll start today. We've been with the company for just over a year now, so we thought we'd sort of share where we've come on the journey the last twelve months and focus for the next twelve months. So look, it's been a big year for us. It's been a really big year, and we've really turned this company around.

1:23 So we came in, we refreshed the board and management team, and most importantly, we added the global Domino's experience. So, you know, what we're trying to do is emulate the other successful Domino's brands around the world, and that's what we're trying to do here. We looked at our portfolio. We did close 10 stores in the last twelve months. So I came in, we identified loss making stores and stores that we didn't see potential in. These were mainly shopping center stores, and with the the trend in shopping center stores and no Sunday trading and the increase of rents with with inflation, we've decided to close most of those locations. We still have another two locations we would like to close, and then we're really happy with the rest of our portfolio.

2:10 You'll see later on the slides, we still have a few loss making stores, but we really feel that we can grow ourselves out of that and make them profitable as well. We used a lot of CapEx, lot of capital investment in existing stores, and that was for maximizing productivity. You know, we're we're going in there, reimaging the area, and we see sales are increasing. We also see delivery times dropping in the stores that we do this, and that bring down brings down our labor as well. We're focused on the high volume mentality, and that's going very well. So the increased customer value proposition through faster delivery, compelling pricing, and high quality pizza is really working for us.

2:57 Over the next twelve months, we'll continue our focus on increasing our average weekly order count as this is key to further increase profitability. We'll continue improvement in customer retention numbers through operational excellence and further reduce times and now delivery times. You'll see in some further slides, we've made some big reductions and we strive for more. And then most importantly, growth and profitability to drive compelling franchise proposition.

3:30 So our h one twenty three results, we've got some pretty good numbers up here. Group revenue, up 26 and a half percent on the same period of the year before. 5% of that is from the purchase of the Croatian market. 21% is growth in the Polish market. So and remembering we had closed 10 stores as well. So closed 10 stores and we're still up 21%. So we're getting big revenue growth. The average order of weekly count is up to nine is up to 700, so 14% up on the on the year before, which is some impressive numbers. And the big one for me is the like for like sales. So we're 17.7% up like for like sales in the same period.

4:18 12% of that was is is increased customer count, and and the rest is either in price or changing our discounting strategy. Group EBITDA, up a 171% on the year before. Q two saw some really increases in profitability as the inflation started to come off into the second quarter, And we've got some charts further in our presentation to really show you exactly what's happening there.

4:50 When we talk about the revenue growth and the p and l structure, it's important to say the main drivers of of this growth. So, basically, 65% of the growth was driven by the other account, and this is exactly the element we are putting the biggest emphasis on because that drives the midterm and long term profitability of of the organization. What is also very important is the fact that the growth was equally delivered by two channels that we have, delivery and non delivery channels. Nondelivery channel is growing a bit faster, but the share of this business in our portfolio is a slow is is smaller.

5:35 It amounts to 40%, and we believe that the compelling propositions in carryout business is a good remedy for the inflationary pressure across Europe. The numbers are translated also to the Net Promoter Score that was increased by more than 50% for both returning and new customers approaching Domino's Pizza in Poland. And those numbers are good ways for the rest of the year and for the future year. Together with growth in the net revenue, we also see, of course, the growth in direct cost because this is a consequence of the of the of the account increase.

6:22 But what we are proud of is the fact that this space is much slower than the pace of the growth on the revenue and system sales, which is automatically transforming to the EBITDA positive results of 1,100,000 at the end of the h one twenty twenty three. Direct costs at the beginning of the year were partially affected by the inflations in energy, food and labor, But

6:51 with all the actions taken on the management side, we were able to mitigate most of those pressures. The first one is the standard scheduling system that was a system for the control of the labor cost. We were able to implement it at the end of q one and roll out at the end of each one to to the full network of in Poland, and that allowed us to drop the cost of labor by three to four percentage points of net revenue. Then with regard to the energy, we've frozen the prices using some of the governmental support for the small and medium businesses.

7:36 And with this, we were able to reduce the direct cost and improve the trading margin and improve our EBITDA. Food costs is is the external factor that we are not really able to control fully. However, even in this area, we did a lot on our portfolio structure as well as on the forward contracts with our main suppliers. Thanks to that. We got these good pricing positions for for quarter three and quarter four and reducing pressure on the food costs simply dropping the prices of the on the sub exchanges let us got a positive result also on on EBITDA.

8:30 SG and A grew by 34%. The major factor for this drive is the TV campaign that we run at the beginning of the year. We have a very good response and results from our consumers. For the autumn of this year, we concentrate on digital because our target group is there, and we believe that we will get even better efficiency, cost efficiency, and better return out of these investments. All in all, the EBITDA improved by 170%. The absolute number of £700,000 improvement on this line was also incorporated to the to the net result of the period. It's still negative, but we see a very good trajectory for the future.

9:18 And we believe that the second half of the year will be better than the the first half. Okay. So executing our strategy for growth. So, look, when I first arrived, the main problem was sales. We just didn't have enough sales. You know, the the only way to get out of the problem that we had was was to grow ourselves out of it and increase our sales. So we went back to basics, and what do we do? We improved the pizza quality. So we upgraded the pizza quality, we increased the amount of toppings, we increased the amount of cheese. The big one was deliveries. So we started to deliver faster. So now we're down to seven, eight minutes faster to the customer than we were before I arrived.

10:05 And then the third big factor was becoming competitive on price. So, basically, we're just trying to create value value to the customer, and this really improved the the customer retention. So, I mean, overall, it was just a better experience, and this is this is key to raising raising volumes. This led to our high average weekly order count. It's it's growing it's growing fast, and and this is the key to unlocking profits. And that's sort of where we're at the moment at number four. So, you know, we're seeing really improved profitability now as we've got the order counts growing. We're at a stage where the where the company is now actually making money, and we see no reason to for any slowdown in in in growth there.

10:53 Once we see the the profitability in the stores, this leads to the franchising. So, you know, profitable stores are essential to franchising. You know, we need to make sure that the the proposition and that's a good investment. So as the more profits that come into our store, I think the more exciting franchising in Poland will become. And then this will allow us a lot of organic growth, because as we convert our corporate stores to franchisees, that will provide medium term capital for further for further growth, and then we continue on. Okay. So this is a slide showing the delivery times and the weekly order counts. So when I when I arrived, we were in in the low thirties.

11:42 You know, now we're down to around the twenty five mark, twenty twenty five minute mark. So getting to the customer is a a lot quicker. We've found savings in the store, and and that's not only increased our our sales and our weekly order count as you can see on the side, but it's also helped our labor figures because we're just more efficient in in the in the store. Look. We we strive for more. I mean, twenty two minutes is our next goal. You know, we do have some digital initiatives in the in the background that we're working on that we feel that can save a few more minutes off our delivery times, and 700 orders per week per store is not where we want to stop. We've got some slides later on the presentations showing our goals, but this is this is just the start.

12:33 So a few things we wanted to share with you today. So the mobile app. This is a big one for us. You know, we work very, very hard to try and push our customers onto the mobile app. Earlier this year, we'd launched we relaunched our app, improving it less clicks, making it a better visual. And look, it's really helped with with the retention and the usage of the app. So at the moment, we're 89% of delivery orders now placed online, and our mobile app is is now improving dramatically. So we're a 163% up on the same period of last year of mobile app downloads. Net Promoter Score. This is a big one for us, and super proud of this number.

13:18 So, you know, we came along and like I said before, we decreased the the deliveries, you know, we're a third quicker to the door. You know, we put more cheese and we've just made our product a high quality pizza, and and look at the results, you know, for new customers and returning customers both for over 60% up on on the feedback we're getting from the same period of time before.

13:41 Our customer base is growing, which is rather important. Returning customers and and, you know, loyal customers are now up to 64% of our customer base, and and order counts are increasing 14% year on year.

13:59 We talked a lot about the average weekly order count, how important it is for us, and why we concentrate on this for a medium and long term just to make this company profitable. And just to give you a flavor what it means for the pizza business, this is an example of this slide, how we read it via the store network structure. On the left hand side, you can see all the account on the Polish corporate source. H one twenty two, when we when Neil survived the organization, we had 61% of the source below 650 orders on a weekly basis, average on a weekly basis, and just one fourth of the stores being about 750. Currently, we are getting closer to 40% of stores being about 750, and we can say that in overall over the last twelve months, we were able to improve the order count by 110 orders on average on a weekly basis for every single store.

14:59 That translates directly to the EBITDA that the stores are able to generate. On the right hand side, you can see the slide exactly in the same structure, but showing which stores are profitable and which are nonprofitable. And you can see clearly that in last year, just one fifth of the stores were profitable. There was a big group of stores being on breakeven. And currently, we are approaching a half portfolio being profitable and 80% of our portfolio being breakeven plus. When we translate it to the average EBITDA picture, we can say that over twelve months, we improved by four percentage points the store EBITDA on average. And this is how we understand every single $100 added to the business on the EBITDA level.

15:52 Just to give you another flavor what it means for us, I I would like to show you also the market or submarket we are dominant that. We play the first we have the first position on. This is Warsaw area. And here, using exactly the same activities as earlier in his I mentioned pushing the same parameters of our business, we were able to double the number of the of the stores having the orders above 750. And on average, we improved our weekly of the company 140, which is almost 25% more than on total market. And at the same time, the profitability went up by more than five percentage points in the same period, and we doubled the number of profitable stores.

16:45 In this picture, we see 85% of the stores being above breakeven or a breakeven plus. This is out of those two slides, we can draw two conclusions. The first one is that it proves pushing the top line and all the account is directly transferable to the EBITDA.

17:05 And the second conclusion is that whenever we play a dominant role in the market, those effects are even more visible. Therefore, when we go to the to the end of our slides and we will discuss about strategy, One of our goal is definitely to to grow to add space and improve the source performance of those network that we currently have. These two slides can be transferred to kind of a summary EBITDA perspective. Here, you can see the horizon of the last eighteen months,

17:38 which describes you a fluctuation of EBITDA on a monthly basis. And we can clearly see a positive trend over the over this period, and we start seeing very positive results more or less from May this year where the time the system scheduling system for the labor cost has been spread over the all our network where the food prices started to abate and whether we could absorb also the freeze on the energy prices. January and February is a bit difficult well, the the difficult month for us because that was the moment that that was the first week the winter after we're starting the war in Ukraine. So we absorbed lots of our inflationary pressures. But generally speaking, we managed to cover that with some of our activities, and we stay on the growing trend.

18:40 To to give you the flavor, what has changed in the most important period for us when we see that the results are getting back to the business, please compare the last four months, which is my August 23 to the my August 22, and you will see that there is a visible step change in the performance of the organizations, and we simply want to follow this pattern for the next months. Yes. So I suppose still just on on this last slide, Edward. So I mean, the the the biggest three changes for us is more volume. We're putting more volume through, and our two biggest costs of the business is food and labor. So, you know, when I first arrived, the inflation hit. So, you know, where we are today compared to December, January, and February, you know, we're talking five percentage points more on food. So it was it was an uphill battle and and one of the biggest costs for our business. The other one was the labor. So we we brought brought in the tent the tender scheduling system from Australia, and we started rolling that out in January, and then by early July, we had that rolled out in every single store in the country. And and we've seen consistently labor dropping down that whole period. And since we've had the tender improved, our labor has sat at a very, very nice level. So, you know, before I arrived, you know, we've cut nine nine percentage points off our food and labor compared from a year ago to where we're sitting here, plus that extra 21% of sales. That's what we're starting to see these profits come in,

20:11 you know, and and we don't see it stopping. You know, we we we don't we don't see unless we have another big inflation, you know, we don't see our food increasing and our labor, you know, we've been working very hard on this, we don't see that increasing as well. Sales augmenting is still continuing. We're still double digit, still still growing our customer count at double digits. You know, we we see this trend continuing.

20:34 Yep. Okay. So now that we've got we've got all of our our house in order, you know, we can really start concentrating on the future, and we just wanted to give you a bit of a flavor of what we think is possible in Poland in the next three to five years. Certainly, Poland is a big country. You know, we've got 40,000,000 plus people. Booming economy has been for a while, and and and we feel the country can support 500 plus stores. Our medium term target is 250. To the right hand side, our average weekly order count. So, yeah, you know, we're proud of getting to 700, but and that's where the profits are starting to unleash now that we've got our our correct food and labor numbers in line, but we need more, and we're very confident for more. So our goal is 900, and and we simply get that from from other European Domino's countries,

21:28 and and Croatia as well, another one that we own, is doing far beyond 900 orders per week. So we're very confident that we can get there and get that growth. At the moment, we have 20% of our portfolio above 900, and that's our goal over the next three to five years is to get the whole whole group up to 900, you know, and the profits when we're hitting 900 are going be very quite nice. Franchise stores, so at the moment, we are 7% franchise stores. So the profitability on for franchisees is quite good. Year to date up to August is 10%, and as you saw from the last slide that Edward presented, you know, we had a poor q one because the inflation was still was still relevant.

22:13 So the franchisees are quite happy, you know, they're making good profits out of their stores, and, you know, our goal is to move that to 60% and ultimately 90%. Group pre IFRS, so our modeling is showing as we increase the stores as corporate and then also sell down to franchisees, and what I'm saying that we should be making between 1013% EBITDA. Yep. And even today, sports of stores are doing already 6% EBITDA. Of course, this is not the trade for us EBITDA, but at least show the directions we are want we want to go. So that is a kind of a proof that the direction chosen is the right one to to deliver the matching number. Okay. So in summary, you know, look, we're we're we're really proud and really happy with the last twelve months.

23:03 As Edward mentioned, if we didn't have the inflation, we'd be, you know, very, very good position there. But, you know, compared to all of our competitors and other Domino's markets, you know, we are doing very, very well. We see no reason for it to stop, and now that our KPIs are in line, we don't see the profitability going back under either. So in summary, significant progress made over the past twelve months. Revenue and profits are growing fast. Improvements in delivery times and product and product quality is driving higher customer satisfaction. Higher average weekly order counts is the key to to higher profitability. You know, we see in our existing stores, the stores that are over 700,750 are making really good profits.

23:48 Improving store economics will kick start the franchisee rollout and provide the flywheel for growth. You know, this is a big part of our transition and will be the folks moving forward. And then the last point we want to get across is that the Polish market has huge potential for 500 plus online stores.

24:10 I think that is our presentation for this h one results update. We wanted to make it much more condensed than the previous time just to give you the main bullet points. I think it's a good time for the questions. Yes. Is that right? Yes. So, also, a lot of the information is in the appendix. So if you have any questions about want any more information about the economy in Poland or our competition or there's a whole lot of information in the appendix. Happy to answer any questions now, and otherwise, you can email us, and we can speak to you privately. Edward, that's great. And thank you very much indeed for your presentations this afternoon. If I may just jump back in there before we move to the questions. Ladies and gentlemen, please do continue to submit your questions just by using the q and a tab that's situated on the right hand corner of your screen. But just while the team take a few moments to review those questions that were submitted already, I would like to remind you that a recording of this presentation along with a copy of the slides and the published q and a can be accessed

25:13 via your investor dashboard. Edward Mills, we did receive a number of presubmitted questions ahead of today's event. And as you can see there in the q and a tab, we've also received a number of questions throughout your presentation this afternoon as well. So Alex, if I may just hand over to you just to share the q and a session with the team, and then I'll pick up from you at the end. Thank you. Thanks, Mark. Thank you. Brilliant. Thank you very much. So first question that's coming here, I think it's probably to you, Edward. Can you please comment on the development of the business from a long term perspective, particularly extending the master franchise agreement? Yes, sure. So answering this question, I think it's very straightforward. We have a master franchise ten years plus ten years. So we have a privilege to prolong it for another ten year. We are entering the growth path, I think, for the first time in the history.

26:06 We have a lot of support from the DPIs or the franchisor, and we simply believe that this is the moment for the transformation. So they are very supportive. We want to follow this path. We want to make it delivered, and we feel very confident that next ten years will be very, very successful for us. Great. Thank you. Neil, I've got one here for you. And and, Edward, you might want to put up slide 21 while Sure. This. Can you explain the supply side competitive picture? What is your estimate on market share? Who are the other players?

26:45 Okay. Yes. So in Poland, we are number three. So we're the third ranked player in Poland. I think it's Just one that's Yes. Okay. Yeah. Yeah. So we're number three. So number one is actually a local pizzeria, a Polish pizzeria called De Grasso. Number two is Pizza Hut, and and we're third in that rank. So we are dominant in in the the biggest city in Poland, which is Warsaw. We're also dominant in the third biggest city in Warsaw as well. So, you know, we do have a lot to catching up to do. As you can see from this slide, yeah, they're they're the numbers. We still have a 100 and a 100 and frog scores, and, you know, we feel we'll be chasing down Pizza Hut. Yeah. But the important thing here is also to understand the quality of different players on the market because the numeric distribution is not everything. I believe that within this portfolio, we have, like, two or three players that we really should confront with.

27:46 There might be some small players also on the market. So

27:51 we choose the right competitor to look at, and we believe that we have a big potential to to beat some of the players that you see on the street. Right. Thank you. Got a couple of questions on cost, which I'm gonna put you, Edward. Yeah. Sure. How far along the cost cutting optimization journey are you in terms of HQ costs, commissionary, labor savings via tender? And is there more to be done here, or have you achieved the bulk of the cost savings at this stage?

28:21 It's a very good question, and thank you for asking this. Like, actually, it's in my nature that I will never give up cutting the cost. This is a bit of the role of the finance manager. But being very direct, I think we have somewhat of a half pace with this with this cost cutting. We put the priorities on the areas that we believe are most important for the solid growth and sustainable business. We started from the labor cost of the sales because they weighed most. So down the scheduling system is the first element that that we wanted to implement. We believe that within this element, there are also some upgrades that we can potentially do in the coming year just even to improve the the situations on the labor cost that we currently have.

29:09 We in the office, we already started looking at the cost structure. We improved a bit of the headcount to the positions that we believe is optimal. We also looked into the cost of the organization, the incoming salary.

29:27 I believe there is still some room for the improvement, especially with the optimization of some of the processes. This is important, of course, for the whole organizations, but it requires some CapEx investments. And we just put it into the priorities on some lower position. Potentially, we will start looking into this in more more carefully quarter four or beginning of the next year. Did did I answer the questions or I'm missing something? No. I I think you answered the questions. There there's a follow-up question, which I'm gonna put to Neil's here, but it's very specific on on Tanda, which is can you talk us through the difference that Tanda has made, and is it fully rolled out across the entire network? Is it working as well as you thought, or are there further gains? And is it benefiting the top and bottom stores equally?

30:18 Yes. It's definitely met our expectations. It's affected every store in the country. I think what is really encouraging for us, the gentleman, one of our best managers in the country, he actually was in charge of the rollout. He's actually been running one a store under his umbrella for a number of years, and it's in top 10 profitability of stores, and he's and and he he's had direct control over that for a number of years, and even he found savings in his labor. So even, you know, the best in class in Poland found savings, and we're really where we really found some savings was the bottom. And yeah. So the the bottom stores where we got the most savings and the best run stores, yes, we still did see savings.

31:06 You know, we're still learning it, and, you know, we we feel as the sales go up, labor will just continue to go down. So, you know, in your labor, you have a big fixed cost for your management, and so the higher your sales go up, the lower your labor will go down. So, yes, we are very happy with it. One more comment to the cost, the previous question. Sorry for that, but they cut it to to pieces. Of course, in the HQ calls, we have lots of the of the customers that are connected with the performance, but they are not so directly visible. So this is like we are pushing strongly on the mobile app development just to save on the cost of the aggregators. We are pushing on digital in the communications and on the performance marketing just to reduce the that just to be more efficient in the in cost spending on marketing than we used to do it before.

31:59 So we we are looking at the cost of transact transactional cost with in the ecommerce. So I will say that there are plenty of rooms for the optimizations, but the scales and the results of the ops optimizations in the absolute terms will be definitely much smaller than, like, launch of the data scheduling system. So from that perspective, we have not started with everything in in one moment, but we are going through step by step down by the level of the priorities. And soon, we will be getting closer and closer to the next projects that will improve the performance of the of the organization. Thank you. Got a bit of a follow-up question to that. We'll certainly link to that, but I think it's worth going through, which is what enhancements have been made to your digital infrastructure to drive sales and efficiencies? And Edward, do want to pick up on that? Yeah. So as I said, we know that within our organizations when we look at the the the digital development, we had to just cover some deficits.

33:10 So we improved the the accounting systems. We improved some processes to be automated. So we moved the organizations to the average. But the only one one of the major things that we put biggest emphasis on is definitely the digital.

33:27 We want to differentiate ourselves from the competitors on the market with this specific medium. We believe that in the ecommerce, especially, a proper digital development gives the competitive advantage. And for that reason, we put a lot of effort to upgrade our mobile app. We did the first upgrade at the beginning of the year, and it resulted in tripling the number of the downloads of the of the apps you saw on the previous slide. Now we are getting to the closely to the relaunch of the app. We are having additional features for the cross sell, upsell, better directed telecommunication. So all in all, we want to be in the positions that we really talk to our customers, and we offer them the promotions that they really need, and we do not supply any.

34:20 At the same time, we do not forget about the web page solutions that we currently have. But definitely, the mobile first approach is the one that the ecommerce is currently putting the bet on, and we won't be there as well. So so the web page will be upgraded accordingly. Thank you. Next question here for you, Niels. What are your priorities over the short term? Priorities over the short term, pretty basic. Continue handling the rush. You know, what we find in our stores, you know, the better operation we are, the more sales increase. So, you know, that's where we are at the moment. We continue to focus on operations. It's always it's a focus on operations.

35:07 And short term goal is to continue the sales growth, get the profitability into the stores, and then start the franchising. So that is our short term goals. Brilliant. Thank you. And I've got another question for you here, Niels. Can you please discuss how competitors are responding to your progress and benchmark against your KPIs? Look, as far as benchmarking KPIs against our competitors, I'm not too sure on on on that. You know, we watch their marketing. We we know what they're doing in the marketplace. We always want to make sure that we're either matching our competitors or or trying to beat them with value. So, you know, we know that we're the fastest delivery company in Poland, and, yeah, but we're just trying to create create that value. So it's not just on price, it's it's that our overall package, you know, our delivery times, our pizza quality, the way our stores look, and the last thing is our price. So, you know, we remain competitive in the markets, and we want to be the market leaders, we're not followers, we want them to follow us.

36:09 Right. Thank you. Coming back to you, Edward, for this next question. In terms of your bottom five, ten, 15 stores that are in the sub six fifty average weekly order count, do you feel that they can be improved enough to get to this sort of seven fifty to 800 order count in a reasonable timeframe? Or are there further stores to close? And 51% of the stores have an average weekly order count of less than six fifty. Can we get a better idea of how low some stores are in terms of average weekly order counts? You know, it's it's a very wide questions and very good questions. And we we have been asking these questions ourselves for the last twelve months, so what to do with our subnetwork structure. So we did this a deep dive analysis into the portfolio that we currently have, and we divided this portfolio into the pieces, making kind of the baskets with the labels impossible to improve, possible to improve our cash cows and so on. So the the the the basket that we believe is structurally impossible to be to to grow, to to change the the the profitability is, in our opinion, in 95% already closed.

37:26 That were the stores that were located in the in malls. After the COVID time, the the purchase patterns of the consumer changed dramatically. The malls were hit by 30% drop in the traffic. At the same time, those locations had the highest possible rents, 10 times higher than the street locations. So from that perspective, we just wanted to get rid the stores that were kind of a disruptors instead of instead of concentrating on the right right source of the capital potential to grow. We did this exercise. We closed them. In our opinion, current store network that we have has all has the potential to grow.

38:16 One of the stores will be growing definitely faster, and other stores will be potentially growing slower. We do not forget about organic growth. We want to open new stores. We want to go into the franchise mode. So hopefully, next year, we start this journey with the franchisee partners on board. And, you know, this is a business, and business is dynamic. And if we realize that some stocks require another approach and some stocks will require to be closed, probably we will take this decision. But we will be taking this decision definitely on some sound arguments supporting this decision. Thanks, Edward. We've got one last question here, and I think this one is for you, Niels. What do you attribute as a reason for the ongoing growth in sales?

39:09 Look. I I I think I've mentioned it before. I think that the overall experience the customer is is receiving is just better. You know, twenty five minutes of it's not twenty minutes, but it's still a good number. So our pizzas are arriving fresh and hot. We're consistently delivering on time now. Our product is better. Our communication to the to the consumer is better. You know, our marketing department's done a great job in the last last year. We've reshaped everything there. So, you know, it's just the overall the overall package. Our product's better, our service is better, our stores are looking better, and and our marketing is really driving through. Brilliant. Thank you, Niels. That was the last question. So I'm just gonna hand back to Jake. Perfect. Niels, Edward, Alex, thank you very much indeed for being so generous of your time there and addressing all of those questions that came in from investors this afternoon. And, of course, if there are any further questions that do come through, we'll make these available to you immediately after the presentation has ended. Just for you to review to then add any additional responses, of course, where it's appropriate to do so, and we'll publish all those responses out on the platform. But, Nils, perhaps before really just looking to redirect those on the call to provide you their feedback, which I know is particularly important to yourself and the company, if I could please just ask you for a few closing comments just to wrap up with, that'd be great.

40:26 Yeah. Cool. Thank you very much. Good. Thanks, everyone, for your time today. I hope you can see the, you know, the turnaround that we've made. You know, with the company, it's been a tough year with the inflation, but, you know, we feel we've come out very well. We're very confident in the future. We're very happy with what we achieved in the last twelve months. And, look, we're really excited for the next twelve months and what we can achieve. So thank you very much for hearing us today. Thank you. Thank you. Neil, Edward, that's great. And thank you once again for updating investors this afternoon. Could I please ask investors not to close this session as you'll now be automatically redirected for the opportunity to provide your feedback in order that the management team can better understand your views and expectations.

41:11 This may take a few moments to complete, but I'm sure it'll be greatly valued by the company. On behalf of the management team of DP POLAND PLC, we would like to thank you for attending today's presentation. That now concludes today's session. So good afternoon to you all. Thanks, Jack.