We see sustainability as one of the core prerequisites for the long-term success and future viability of our group. I am very pleased that our group financing is linked to our ESG strategy.

Yes. With the conclusion of the ESG supplementary agreement, the financing costs of the revolving syndicated loan are also influenced by three Key Performance Indicators, which reflect the company's sustainability performance in the areas of CO2 reduction in its own operations, product range, and increasing the proportion of female managers. The financing of 500 million euros agreed in September 2022 included a rendezvous clause, that later allowed the credit margin to be linked to specific ESG indicators. The ESG component now enables an interest rate reduction of up to 2.5 basis points.

The structuring of the sustainability component was supported by Helaba as ESG coordinator.

We are not currently utilising the syndicated credit line. It serves as a back-up in the event that unusual events occur or an opportunity arises in the M&A area, so that we can act quickly. And to your follow-up question – a total of nine banks from Germany and abroad are involved in the syndicated credit line, which runs for up to seven years.

We are very satisfied. On the one hand, we had significantly better weather than in the previous year, which encouraged people to spend time in their gardens, on their terraces or balconies. On the other hand, consumer sentiment was slightly better than in previous quarters. This is due to the fall in inflation rates and the unchanged low unemployment rates. However, sentiment is far removed from previous highs.

For 2024/25, we expect sales to be slightly above the level of the previous financial year, which was 6.16 billion euros. We estimate that adjusted EBIT – earnings before interest and taxes, which we adjust for non-operating effects such as impairments – will be at or slightly above the previous year's level of 254 million euros. I can understand why some market observers see this as cautious, given that the first quarter went well due to the weather. However, we believe that the complex macroeconomic challenges remain, meaning that a strong recovery in the consumer climate, which is important for Hornbach, is unlikely in the short to medium term. We therefore consider the admittedly cautious forecast for 2024/25 to be appropriate.

2023/24 was a very challenging year in macroeconomic terms. We are therefore satisfied with our solid figures and the resilience we have demonstrated.

This is correct. However, sales and adjusted EBIT in the past financial year were in line with the forecasts revised in September 2023. For sales, we had predicted a figure „at or slightly below the level of 2022/23“ - which was 6.26 billion euros. In the end, sales fell by 1.6% to EUR 6.16 billion. Our previous expectation was „roughly on a par with the previous year“. What is important to me is that the results are very solid for an environment characterised by inflation, in which customers tend to spend less and are very cautious when making impulse purchases in particular. And on average over the past ten years, we have grown by 6.2% annually in the Group.

Hindsight is always wiser. For adjusted EBIT, we had most recently expected a decline of 10% to 25% compared to the previous year's figure of 290 million euros. 2023/24 then brought a drop of 12.4% to 254 million euros. The operating result was thus at the upper end of our adjusted forecast.

Of course, our goal is to achieve a disproportionately low cost trend compared to sales growth. Unfortunately, the inflationary environment, the disruptions in the supply chains and the succession of exogenous crises have made it more difficult to achieve this goal. With regard to our operating expenses, we are naturally maintaining our previous strict cost discipline. However, the greater levers for improving profitability are our sales and our gross margin - and the latter in particular has improved sequentially in recent months thanks to our efforts.

Our broad geographical footprint is indeed having a positive impact here. Although the operating margin in our eight foreign markets fell by 0.5 percentage points, at 6.5% it was still significantly higher than the margin of 1.9% in Germany. This also has an impact on the share of adjusted EBIT: Germany accounts for 24% with 60 million euros, while the rest of the world accounts for 76% with a total of 194 million euros.

Our operating cash flow has improved from 345 million to 455 million euros in the past three financial years. In the most recent reporting period, this primarily reflected the change in working capital, namely the reduction in inventories totalling 187 million euros. And free cash flow rose by more than 45 million euros to 232 million euros. The 5 per cent decrease in capex investments to just under 193 million euros at the holding company played a role here. Around 41% of this was invested in the acquisition of land and the construction of new stores, and 38% in the remodelling of stores and their equipment. Software and acquisitions each accounted for around 10%.

The ability to be more agile and therefore more resilient than in previous times is important. Conversely, we want to avoid redundancies because they cause costs that put pressure on margins. What have we done about this? Where possible and sensible, we have added a second or third supplier to a product or range in order to become less dependent on supply bottlenecks. We at Hornbach are big fans of local and regional suppliers anyway. We only get a very small percentage of our goods directly from China, for example. However, many of our suppliers naturally have global chains, which means that we could also be indirectly affected by corresponding distortions.

Our priority is to reduce our net debt or to bring our net debt to EBITDA (earnings before interest, taxes, depreciation and amortisation; editor's note) into an even better ratio or to keep it there. That is very important to me. I am also trying to keep interest charges away from the company as far as possible. In addition, we want to finance our capex investments on average from the operating cash flow; the ratio should therefore be equal to or greater than 1.0.

That is not an issue for us at the moment. I know it's en vogue, but I don't think much of it, as it would probably further reduce the liquidity of our shares on the stock market.

As of 29 February, the ratio of our net debt to EBITDA was 2.5. That is our target level; if the figure is lower in future – all the better. Of course, this will also strengthen our rating. In autumn 2023, Standard & Poor's confirmed our BB+ rating. We would like to be one notch higher, then we would be investment grade and probably have even lower financing costs. On the other hand, we already have a very strong balance sheet. The holding company's equity ratio has risen from 40.1% to 43.5% year-on-year, which I would describe as very robust. This results in a very comfortable credit rating.

Yes, we have reduced our debt by 167 million euros. Among other things, we have repaid our promissory note loans to a significant extent.

In terms of debt capital, we have a financing mix in which we utilise the traditional options offered by access to the capital market. A key and traditional component is our outstanding bond. It has a volume of 250 million euros and matures in October 2026. At an appropriate time, we will refinance the bond. However, the issuer will no longer be Hornbach Baumarkt AG, but the parent company Hornbach Holding, as we believe it makes sense to bundle the financing in the parent company. When we delisted the Hornbach Baumarkt share in February 2022, we already stated that we wanted to focus on one share and one capital market launch.

At the time of the issue in October 2019, we had already passed the low point of the low-interest phase. The bond therefore has a fixed coupon of 3.25%, which I consider to be favourable from the perspective of the time, but not optimal. Currently, the price of the bond, which has a remaining term of two years and five months, is 97.7%, resulting in a yield of 4.25% per year. As far as refinancing is concerned, Hornbach was rated one notch lower at the time of issue than it is today, which should tend to depress the interest rate of the future bond. On the other hand, interest rates have risen overall since then. If we were to issue a comparable bond today, the interest rate would probably be very similar to the current bond. However, in view of the expected series of interest rate cuts by the ECB, I assume that refinancing could become more favourable for us by the end of 2026 than it would be today.

Finance leases within the meaning of IFRS 16 account for a large proportion. This essentially relates to the part of our stores that are leased from third parties. In addition, there are promissory note loans, standard bank loans and mortgage loans, which we utilise rather opportunistically. At the end of February, we also had unutilised credit lines of 521 million euros; this includes the revolving syndicated loan of 500 million euros discussed at the beginning.

In the past financial year, we repaid two bullet promissory note loans and did not take out any new ones. This is in line with our general strategy of continuously reducing net debt. No financing instrument with a significant volume will mature in 2024/25. Next year, however, a larger promissory note loan will fall due again, but I could imagine that we will also repay this from our current cash flow.

For 2024/25, we are planning capex investments at the previous year's level, roughly 193 million euros. For the years after that, I can imagine that they will also be around this level - perhaps plus/minus 10%. The lion's share of the investment sum will always flow into our physical stores - for example in new buildings, but also in existing properties, for example for the installation of drive-in car parks, which are very popular with customers, or the installation of photovoltaic systems. Investments are also being made in IT infrastructure.

We had estimated that capex investments would be slightly below the 2022/23 level. At 192.6 million euros compared to the previous year's figure of 203.5 million euros - a decrease of 5.4% - I would say that the announced volume was met.

Sales at our DIY stores fell by 1.1% to 5.78 billion euros in 2023/24. In Germany, sales in DIY stores and garden centres fell by 2.6% in the past financial year, while in the other eight European countries in which we operate stores, they rose slightly by 0.3%. As a result, the share of sales has shifted slightly: Germany accounted for 48.2% of revenue in 2023/24, while the rest of Europe accounted for 51.8%.

That is correct, but I would like to point out that compared to the pre-corona year 2019/20, our like-for-like sales adjusted for exchange rate effects in the DIY store subgroup rose by 28.7% in 2023/24.

Our business in the Netherlands benefited from a higher number of customers and strong sales in the project business. In addition, the construction industry in the Netherlands - in contrast to Germany - developed positively, which also benefited us. The number of our stores there has also grown from 14 to 18 since 2019. In addition, competition for large DIY stores and garden centres in our neighbouring country is not as intense as in Germany, which makes business easier for us. Competition in Austria is very intense, similar to Germany. In addition, a clearly negative trend in the construction industry had an impact on the building materials business in particular.

We have gained share almost everywhere since 2019; on average 2.6 percentage points. According to surveys by market researcher GfK, the share in Germany rose from 13.1 to 14.9% between 2019 and 2023, in the Netherlands from 21.1 to 27.1%, in the Czech Republic from 33.3 to 36.2% and in Switzerland from 12.0 to 13.9%.

Our successful interconnected retail concept played a key role. By this we mean the mutually reinforcing synergies between our bricks-and-mortar and online business. The simplest example: with „Click & Collect“, the customer searches for and orders goods in our online shop and then picks them up in one of our stores.

Compared to the previous financial year, our online sales fell by 11% to 732 million euros. This means that the expected consolidation following the boom during the coronavirus pandemic has continued. Compared to 2019/20, however, online revenue is still three quarters higher. The online share of the DIY store subgroup's total sales, including „Click & Collect“, thus amounted to 12.7% in 2023/24. This is a decline of 1.4 percentage points. However, this only reflects the general, cross-sector trend of falling e-commerce revenue. One should also look at the pre-corona figure: At that time, the online share of total DIY store sales was below 10%.

Direct sales accounted for 517 million euros, a drop of 10% compared to the previous year. „Click & Collect“ accounted for 215 million euros, a decline of a good 13%. „Click & Collect“ in particular was exceptionally high in previous years due to store closures during the pandemic. On the other hand, our online sales also show that direct shipping remains at a very high level and that this channel has established itself with our customers even after the pandemic. The development of our customer accounts should also be emphasised positively: they increased by 17% to 4.1 million.

They date back to the 2021/22 financial year, when the restrictions on daily life due to the pandemic were at their peak. At that time, total online sales amounted to 944 million euros, which corresponded to 17.2% of total DIY store sales. Direct mail order contributed 588 million euros and click & collect 356 million euros. Now that stationary shopping is possible again - and many of our products still have a high haptic component - this share has declined as expected.

In fact, the gross margin increased from 33.4% to 33.8%. The second half of the financial year in particular contributed to the increase. This was due to lower raw material prices compared to the previous period and a more profitable product mix.

Let me give you an example: in 2022, there was a veritable panic buying spree for fuel, electric heating appliances and the like …

Although this brought us additional sales, these tended to be low-margin products. In contrast, good weather like in spring this year brings us a lot of customer interest in our garden and landscape range, which is generally higher-margin.

It accounts for a quarter of total sales. We would like to increase this share. We have our own brands in all product groups and differentiate between „good“, „better“ and „best“ - depending on our customers' needs.

On the one hand, this has to do with the increase in the online share, which has a lower gross margin due to shipping costs and a different product mix. On the other hand, it is a consequence of the adjustment to higher inflation. Purchase prices always rise first before higher sales prices become established on the market. Due to our permanent low price strategy, we only adjust our sales prices upwards if our competitors' prices also rise.

We had to cope with a significant increase in our purchase prices from 2021 to the end of 2022. This has calmed down over the past year. The supply chains are working again and freight costs for sea transport are significantly lower than they were two years ago. Due to our moving average prices, it will take some time for the lower purchase prices to be reflected in the gross margin. However, the trade margin has been improving for several months now.

Store costs as a percentage of sales climbed from 4.5% to 4.8%. This was mainly due to higher salaries. The central cost ratio rose from 24.9% to 25.6%. In addition to higher salaries, investments in IT staff also played a role here. Overall, our cost ratio of 30.5% was one percentage point higher than in the previous year. For the current year, as in the previous year, we will constantly review operating costs in the branches and administration and reduce them where possible. However, it will not be possible to prevent further cost increases due to wage adjustments.

Price increases for wood affect us not only indirectly, but also directly, as we have many products made of wood in our range and we also trade a lot in wood. Over the past four years, there have been significant fluctuations in the price of this raw material, which had less to do with the availability of wood itself than, for example, with sawmill capacities in the USA, the availability of lorries for transport and the like. However, the price of timber fell again last year. In addition, many of our products are of course linked to the price of oil, so this raw material is also very important for our calculations. In principle, all industrial metals that play a major role in the manufacturing industry, such as copper and aluminium, are also relevant for us.

We pay a lot in renminbi in South East Asia because some of our partners there use the Chinese currency.

We have a lot of customers who really want to tackle big jobs - who want to renovate an entire room, for example. That means drywall construction, painting or wallpapering, flooring and possibly even laying electrical wiring. Then there's all the detailed work. However, we actually saw fewer of these larger projects being carried out last year than in previous years. Instead, customers tackled smaller projects, such as „just“ laying a new carpet or „just“ repainting the walls. However, we have more customers than twelve months ago and are now seeing that the volume of the shopping basket is slowly increasing again, which points to larger projects. This makes us more confident about our sales and earnings performance in the current financial year. Incidentally, it has no impact on margins whether the proportion of sales from large-scale projects is larger or smaller.

As a DIY and garden centre, existing properties are particularly important to us. Our basic themes are refurbishment, renovation and modernisation, which we sometimes jokingly refer to as the San-ReMo effect. In the nine European markets in which we are active, the properties have a relatively high average age, so we don't have to worry about demand. In response to your question, the sharp decline in the construction industry does affect us, but it is not having a fundamental impact on our business, at least not for the time being. But there are long-term consequences: What is not built today cannot be renovated or modernised in a few years' time.

There is a strong correlation between the sales of HBU, which is only active in south-west Germany, and construction activities in the country, partly because the subgroup mainly has commercial customers. The 10% drop in sales to 381 million euros sounds like a lot, but from what we hear from our competitors in the building materials sector, we are still doing relatively well with this decline. Adjusted EBIT slumped by two thirds to just under 5 million euros. The slump in the construction industry is likely to continue for at least this year. There is a silver lining on the horizon from the ECB: I expect interest rates to be cut by 0.25 percentage points before and after the summer break. This could give the construction industry an initial boost.

Because HI's business largely consists of properties let internally to the DIY store subsidiary. Changes in sales and earnings at HI are therefore mostly due to changes in the property portfolio or in the property utilisation of the DIY store subsidiary. This is all very unspectacular.

62% of the sales area of all Hornbach DIY stores is owned by the Group. A good half of this is recognised as assets in the balance sheet of Hornbach Baumarkt AG, the other half is held by HI.

In 2023/24, adjusted EBIT in this subgroup rose by more than 13% to 63 million euros.

Hornbach has always paid a dividend since its IPO in 1987. Our target is to pay a dividend at least at the previous year's level, which has always been the case over the past 37 years. The average payout ratio should be around 30% of consolidated net income after minority interests. With earnings per share of 7.83 euros, this corresponds to 30.7% for 2023/24 after 24.4% and 19.2% in previous years.