AbbVie Inc. (ABBV) Earnings Call Transcript & Summary

Great. Good morning, everybody. I'm Terence Flynn, the biopharma analyst at Goldman Sachs. I'm very pleased to be hosting AbbVie this morning. Joining us from the company, we have Rick Gonzalez, Chairman and CEO; Mike Severino, Vice Chairman and President; and Rob Michael, Executive VP and CFO of the company. Thank you very much for spending time today with us, everyone, and really appreciate it.

Maybe just to get started at a high level. Obviously, COVID is top of mind for everyone. And in our view, it's going to have near and long-lasting impacts on the health care system and business models if you think about delivery of care, clinical trial conduct and supply chain. So Rick, was just wondering, maybe to start, if you could share any preliminary perspective from where you sit on the ways COVID could shape your business and strategy?

Sure. Well, first, Terence, thank you for inviting us. It's a pleasure to be here with you. Certainly, if you look at the COVID crisis, it was unprecedented in the impact that it had, I mean, really across the world and certainly in the world that we operate in. And I would say, if you think about it at its simplest level, at the core of what we do is the physician and patient interaction. And obviously, we interact with physicians from an infield standpoint, and we interact to some extent with patients from an infield standpoint. And that was disrupted in this process as patients adhere to stay-at-home orders and as physicians' offices, in some cases, closed or in other cases, significantly reduced the volume of patients that they would have in their offices and went to telemedicine as an alternative for that. We obviously had to adapt and as our own employees went to work remotely. Well, we're now in the phase where we're starting to see a significant number of states lift those stay-at-home orders and things are starting to return back to some level of normalcy. But there are some fundamental changes that we're seeing occur in the business model. I wouldn't say, overall, it's a significant change from how we operated in the past. But certainly, as you think about it, as patients start to feel more comfortable to go back into physicians' offices, the physicians' offices are putting in significant precautions as it relates to both the density that they have in their offices, personal protective equipment for patients and for staff, temperature monitoring, things of that nature, questionnaires that patients have to answer ahead of time to try to maintain the highest levels of safety as possible as it relates to COVID. But we are seeing now, as many of those states start to return that our own infield teams are starting to go back into these offices. I wouldn't say we're planning on altering the mix of what we do remotely historically. And the level of infield in-person interaction that we would have expected prior to the COVID situation, ultimately, we expect to migrate back to a model that's somewhat similar to where we were before. And I would say the speed at which we're seeing that recovery occur is consistent with the assumptions that we made in our first quarter call, where we laid out pretty specifically the assumptions we made about timing for practices to return to some level of normalcy. I'd say it's tracking in the states that have opened up consistent with that or potentially slightly better than that. So I feel good about that aspect of it. So hopefully over time here, we'll return to a level of normalcy that's consistent with what we saw prior to COVID, and I feel pretty confident that we will return to that level of normalcy.

Great. Great. Well, that's a great intro, Rick. Appreciate it. And looking forward to the reopening and everything going on, on that front. I guess you mentioned this a little bit, but the speed of recovery consistent to maybe slightly better. I know, particularly on HUMIRA and SKYRIZI, you noted that new patient starts were down by kind of 30% to 40% over that time frame. Can you quantify that at all in terms of kind of those metrics as you think about kind of the level of the impact that you're seeing in terms of the recovery?

Well, we're seeing all of those brands start to recover. I'd say they're partially up the recovery curve. We'd originally assumed in our planning assumptions that, that recovery would take over the course of third and fourth quarter to ultimately get back to the levels that they were prior. And so I'd say they're tracking on or slightly above that. If you look at other areas of the business like the aesthetics business, as an example, it was certainly the business within our portfolio that was affected to the greatest extent. And obviously, in the second quarter -- well, near the end of the first quarter and then into the second quarter, we saw most of those practices either closed or very limited activity. I would say in the areas where we've seen shelter in place lifted, that business has rebounded significantly faster than what we had originally planned. So I think that's a good sign. BOTOX is probably a good indicator of that. And we can see in states that there's clearly a warehousing effect that has occurred, where even in some states, it has recovered to above the level that it was before, and we would expect it to go up and then probably decline a little bit from there as that warehousing effect gets burned off. But I'd say in general, I feel good about the experience that we're seeing in a significant number of states is validating the model that we had assumed and maybe potentially a little bit of upside against that model for the second quarter from what we had originally assumed. I'd also say BOTOX therapeutics was the other area that had a fairly significant impact because about half of those procedures are hospital-based procedures. And as you know, hospitals were limiting elective procedures during the COVID crisis. We're now seeing them reopen, and I'd say we're seeing a very good rebound of BOTOX therapeutics across the board. So in general, I'd say we feel good about both the AbbVie side of the business, the recovery, and the Allergan side. The one area that we have built in is the impact that we might see as we see commercially insured patients moving to Medicaid because they lost their employment. And we had factored in an impact all the way through the fourth quarter and the original assumptions that we provided for the AbbVie business. And I would say thus far, we have not seen that play out yet. One of the theories that we have is that many of those patients were furloughed, and therefore, they've maintained their insurance. So we're maintaining that coverage that we have built into it, but we're not seeing a significant impact yet.

Great. Maybe just a couple of follow-ups there. That was really helpful color, Rick. Appreciate it. On your comments around, it validates your model and there's some potential upside, was that comment referred, I'm assuming, to BOTOX and kind of the warehousing effect that you've seen. So you're seeing basically validates the Allergan deal, and there's some upside to the Allergan side of the business. Is that what that comment referred to?

Yes. The comment was primarily around the aesthetic side of the business. Yes.

Yes. Okay. Got it. And then as you think about -- you mentioned commercial moving to Medicaid and this theory on the furlough. Any other possibilities or is there potentially a lag? Like, again, this is all unprecedented as we think about the unemployment numbers. I mean how do you think about some of the other potential dynamics going on here about why you might not be seeing an impact thus far?

Well, it's clearly driven by the unemployment rate. So I said one factor is, I think we are seeing now in the latest job numbers that we're seeing a significant number of people being re-employed. You can get into the debate about what the percentage is based on this classification issue, let's say, somewhere between 13% and 16% versus people predicting probably 20% or higher. So we are seeing some positive signs there, I think, that is helpful. But one of the early indicators that we've looked at, as you've seen probably in our ads, we have been running ads that tell patients that if you lost your job and you need assistance in being able to maintain your AbbVie medicine, come to us because we have a very broad patient assistance program. And so one of the things you would expect to see as an early indicator of this shift from commercial to Medicaid would be people coming to us to try to access that patient assistance program. And that's the area we're not seeing an increase. So that's what's leading us to this theory of potentially, maybe it's because the patients are furloughed, and they still have access to their insurance. Now the lagging indicator will be what ultimately happens with Medicaid going forward. But that's essentially what I'm describing to you is we're not seeing that early indicator suggest to us that we should expect a significant shift yet.

Okay. Great. I think the other near-term and bigger-picture question relates to guidance and really on the near-term front is just perspective on updates to 2020 guidance. It seems like the most likely scenario is in conjunction with the second quarter earnings call in July, but just wanted an update there. And then any decision on how to think about 2021 or longer-term guidance as well? I know that's something that you guys have been contemplating post-closing of the Allergan transaction.

On the pro forma guidance, I think right now, our leaning is to wait until the first quarter call -- I'm sorry, the second quarter call. That is, most of our peers, that's what they've done. And it also will give us the highest level of accuracy being able to provide that guidance going forward. And so I think that is how we're thinking about it. I would say I'm encouraged by the recovery because that's an important part. But I want to see the rest of June play out. And if it continues on the path it's on, I think that will validate and give us a high level of confidence on the pro forma guidance going forward. So I feel good in general about that, but I think we will wait until the second quarter call. For guidance beyond that, I think it's too early to call the '21 guidance. So it is not our intent to give '21 guidance on the second quarter call. We'll re-evaluate that, I think, when we get to the third quarter call. We have, in some years, given next year guidance in our third quarter call. But we want to make sure that -- guidance is an important thing for us. It's one that we regard, that we want a very high level of accuracy. We obviously have a strong track record of meeting or beating our guidance. And so it's something that we spend a lot of time and effort in making sure that what we predict is something that we can deliver or exceed against. And so I think we'll want to see how, as an example, how does Medicaid scenario plays out. By the time we get to the third quarter, we should have a pretty good feel whether or not that's going to play out the way we thought or is going to be better than what we thought. We'll certainly be well into the recovery on all the key products. And so I think we'll be in a much better position to provide the most accurate guidance at that point.

Okay. Makes sense. The other topic I want to dig into a little bit. And again, based on your preliminary remarks, it sounds like everything is going pretty smooth with just the Allergan integration here. Obviously, just given the work-from-home environment here, I'm assuming that, that represents somewhat of a potential hurdle. But as you think about the integration, how is it going? Is everything on plan? Maybe anything of note on the synergy front and how seamless it has been in this environment?

Well, obviously, based on the regulatory process for the Allergan approval, we had some extra time to be able to work on the integration planning between the 2 companies. And so I'd say we have a very good plan, and that plan was well -- the process was well laid out to be able to execute it. So I'm not concerned at all about our ability to be able to deliver on the synergies. We're working that plan well. And both the AbbVie team and the Allergan team that's responsible for that work closely together throughout that entire process. So I don't see anything there that gives me any pause as to how we'll deliver against the synergies. Obviously, a significant portion of those synergies were R&D synergies, and that work was done extensively as we were going through the planning process. And now Mike and his team are in the process of implementing many of those actions. And so I feel good about where we stand on that. Overall, I would say the integration has gone smoothly. And you probably remember when we announced the transaction that we said, we had built the integration model in a way that it would not disrupt the important growth drivers of the business, meaning that immunology on the AbbVie side was going to be walled off so that it wouldn't be disrupted, hematological oncology, the same thing on the AbbVie side. And then on the Allergan side, obviously, the aesthetics business has been walled off. And we've implemented a different structure around that about how the business is operated, meaning it's now a fully dedicated global business that has a president that will report directly to me. But it's unaffected by the activity on synergies. And so we're well on our way to be able to integrate the 2 businesses in the areas that, that integration was necessary. And so far, I'd say, I feel very good about how it's progressing.

Great. Maybe the kind of corollary to that is just the operating margin question. And when you guys announced the Allergan deal, you noted that it would raise the floor on your 2023 margin profile. So just as we think about that outer year margins, is it fair to assume that you can maintain margins at least in the mid-40% range?

Yes. Terence, it's Rob. So if you look at our current operating margin profile, it's in the high 40s, just top-tier in the industry. So then when you consider the greater than $2 billion in expense synergies from Allergan by 2022 as well as the P&L leverage that will come from sales growth, it's reasonable to expect our operating margin to increase beyond that. Keep in mind, we have a very long track record of driving P&L leverage, and we've expanded operating margin by over 1,000 basis points since our inception. Now when the U.S. HUMIRA biosimilars enter in 2023, I would expect operating margin to pull back to the 45% range, which is still top-tier. And as we quickly return to sales growth after that, you'd expect operating margin to begin increasing again. So I'm very comfortable we can maintain margins in that range over the outer years.

Okay. And so just to be clear, so the 45% would be kind of the nadir that would happen in the '23 time frame when HUMIRA biosimilars reach the U.S. market and then you accelerate after that?

Yes. As you see us return to sales growth beyond '23, I'd expect us to continue to drive that expense leverage we've done in the past.

Okay. Okay.

And this is Rick. I mean that is one of the nice features of this transaction. You don't find very many companies of our size that have -- our size and our diversity that have an operating margin even at that trough of 45%.

Okay. Great. And I guess the second part of that question just relates to the dividend. I know you guys are committed to a strong and growing dividend. How do you think about the rate of growth kind of on a near-term basis and then in that post '23 period when the HUMIRA biosimilars start to have an impact?

Terence, it's Rob again. So I'll take that. The thing to keep in mind is the business generates a tremendous amount of cash. If you just look at 2019, AbbVie and Allergan combine for $20 billion of operating cash flow. So that allows us to do a number of things, including support a strong growing dividend and rapidly pay down debt and pursue opportunities like we announced today with Genmab. So given that amount of cash generation, certainly, I would expect the dividend, it's always been an important part of our investment identity. It's a primary means of us returning capital to shareholders. We've nearly tripled that dividend since inception. We announced a 10% increase last October. If you think about it from a payout ratio perspective, I mean, currently, our payout ratio is in the high 40s. So while I do expect us to continue growing the dividend, it may not grow at the same rate as earnings growth. So you could see that payout ratio drift down to the mid-40s. When we get out to 2023 with the U.S. HUMIRA biosimilar event, you could see the payout ratio pop up to the mid-50s, but then return to the high 40s as we get back to sales growth beyond that. And so again, while the rate of dividend growth may vary, I would expect this to continue increasing through that event.

And this is Rick. I mean the only thing I'd add, I agree with everything Rob just said. I mean, I think the simplest way for investors to think about the dividend is, as we move into that 2023 event, the dividend rate will slow in '23, but not -- it will still grow but at a much lower rate and then return to growth as we drive out of that period from '24 and beyond and return back to significant growth. And I would expect the dividend to parallel that kind of growth.

Okay. Great. Appreciate all the details on that front. I guess before we get to the new important product launches, SKYRIZI and RINVOQ, obviously, you had some news out this morning on 2 fronts. So maybe we could touch on that first. One of the key pipeline assets that you guys highlighted at your R&D Day or Investor Day earlier this year was ABBV-3373 for rheumatoid arthritis. So maybe to start, you could just tell us a little bit more about that program, kind of the thought process behind it. And then just quickly recap the Phase IIa RA data that we saw this morning.

This is Mike. I'll take that. So the strategy and the concept behind the TNF steroid ADC is, in some ways, very simple, but it's deceptively simple because it's based on some very compelling underlying biology. And that's the fact that in TNF-mediated disease, membrane-bound TNF is highly expressed on the immune effector cells that are doing the damage. And when a TNF antibody binds it, it's rapidly internalized, which when one thinks about it, makes it a perfect ADC target. Now people are used to thinking about ADCs in oncology, but not in immunology. And obviously, one, a very different sort of ADC in immunology. You wouldn't want to set a toxic warhead. But here we've used as a steroid warhead, and it's a novel steroid warhead with novel linker technology developed in-house that has the ability in all of the systems that we've studied to very precisely deliver that steroid to immune effector cells. We've seen that in preclinical models. We've seen it with human cells in vitro. And that observation is what caused us, what allowed us to drive this program into the clinic and conduct the proof-of-concept study that we top lined today. The proof-of-concept study was in RA patients. We were looking for a particular level of activity. And here, we use the DAS scale because we think that's the most responsive scale for a study like this. We have a good understanding of what kind of change in DAS is necessary to drive the kind of efficacy we would need going forward that would allow us to be better than not only TNF antibodies, but what else is out there. The study hit that level. And then in terms of the comparisons that we described, we compared it to propensity matched HUMIRA data that we have. And so this isn't just sort of an aggregate historical. This is a propensity matching strategy that picks patients that are very, very similar to the patients who are in the trial, and it met our expectations there. And then the second analysis was a combination of that with a small in trial TNF group. And based on that, we used a Bayesian approach to predict probability of success and future development. And that Bayesian approach predicting 90% probability. So based on that, based on the fact that it hit the efficacy profile that we wanted, have the safety profile that we'd expected, we will advance the platform into larger studies, certainly in RA and also in other immune-mediated conditions.

Great. Maybe a couple of follow-ups there is just on the comparisons, the one piece of data that wasn't in there. And again, I recognize it's a small number of patients. It's just the performance of the HUMIRA arm in the actual study. I think it was only 17 patients or so. But can you guys give any more color on how that performed? Understand it was a small number, but any additional details there?

Well, it was a small number of patients. And we weren't powered for that comparison and that wasn't one of the primary comparisons, which is why when we top lined it, we top lined it in the way that we did. We had to save some of the data for the full presentation and for the manuscript. But what I would say is the performance of the steroid conjugate met all of our expectations, and that's why we've advanced it.

Okay. Okay. Got it. And then maybe just on the safety front, it looks like there were some SAEs, and I know a couple of them weren't related to the drug. A couple were. But maybe just help us think about the safety profile as you dig down into it a little bit more?

The safety profile, as we've reviewed the data and we've reviewed them very carefully, looked like what one would expect with an anti-TNF antibody. And of course, the backbone of this is an anti-TNF antibody. So that's not a surprise. When we look at the individual events, we don't see anything that's concerning to us. There was something that was reported as an anaphylactic reaction. It's hard to differentiate that from a serious infusion reaction, which happens with IV administration of monoclonal antibodies. That occurred relatively early in the program when the agent was being delivered IV. We slowed down infusion rate subsequently. It didn't recur. Future development would be by the subcu route for the platform. So it's not something that we would expect to become a part of the long-term profile in any way, and it's not something that concerns us with respect to future development. The other AEs were similar to what one would expect in a trial of this sort. There were 2 infections that were assessed as not related. It was a noncardiac chest pain. And so we wouldn't expect that to be something that would recur in the program. So overall, the safety profile met our expectations. And together with the efficacy results that we described, support advancing.

Okay. And in terms of next steps, so it sounds like you said advance the platform. So is that 3373 is going forward into a larger -- as a Phase IIb, a Phase III trial or is it a subcu formulation and so it's a slightly different molecule? Maybe just help us think about the next steps for the program.

Well, from a clinical study perspective, the next step would be a much larger definitive dose-ranging study. So that's typically called a Phase IIb study. But it would give substantial additional evidence on efficacy and allow dose selection. And so that's the most important next step that would be, I think, a very substantial study. Then the platform molecule to select will be selected based on characteristics that would support downstream development. So we have 3373 and a very closely related molecule, 154. The differences are minor differences in linker chemistry that provide advantages with respect to manufacturability and ease of formulation. And so we would select which of those 2 based on what's most compatible with downstream development. So the ability to deliver subcu because we will pursue subcu development from here. What we think we can manufacture the best and formulate the best because we think that the biological data is transferable between the 2 because they're so similar. So we don't have a formal announcement on that today, but we would pick the molecule to advance based on those characteristics.

Okay. Great. And maybe just the last one. And so 154, there's a separate study going on where we'll have some additional safety data there or is that just based on the preclinical profile?

It's a component of the same study. It just is a separate cohort in the same study.

Okay. And so that will be a separate release when we get data for that molecule?

Well, that's not an efficacy study so we wouldn't typically top line that. But that's to get the human exposure, the PK data to confirm our expectations about the performance of that molecule and to allow the selection decision that I described. But it's not an efficacy study so we wouldn't expect to top line it in the same way we did with 3373.

Okay. And then on safety though, it was the same as 3373 though, 154?

Well, the 154 cohort is ongoing, but we wouldn't expect there'd be any.

Okay. Okay. Understood. Great. And maybe obviously, the other release that came out this morning related to the Genmab bispecific collaboration. We think bispecifics are really exciting technology platform, have done a lot of work on this front. And obviously, you guys feel the same given the deal this morning. But would just be curious kind of as you think about the assets you're bringing in, the go forward, maybe help us think about what the driver was here and then the competitive landscape aspect as well.

This is Mike. I'd be happy to take that. So we're very excited about the deal that we announced this morning, the partnership with Genmab. And it does bring a very exciting and very promising technology platform into our hands as well as a lead asset that's performing very well in the clinic. So the lead asset is epcoritamab, which is a CD3xCD20 bispecific. So it's a T-cell redirecting bispecific antibody. It has delivered very strong data in its early phase trial. Those data are still maturing, but we think there's very real potential for best-in-class efficacy and a very strong safety profile that's delivered a very, very good observed safety profile to date. And one knows what AEs to look for on these platforms, things like cytokine release and the like and the performance there in terms of delivering efficacy without untoward safety baggage has been very, very good. Together with that, it also has a subcu formulation and a very good dosing paradigm, particularly for long-term maintenance that we think will provide real advantages. So if you put all that together, we think those are winning advantages that can lead to a best-in-category therapy there. It's also in a space that we know very well, where we have very strong development capabilities, very strong commercial presence. So we think all of that together will provide a real advantage. And we think the combined strength of Genmab and AbbVie can really drive that program very, very effectively. So we would move forward rapidly into the registration-enabling studies and design a broad and comprehensive program as we've typically done for molecules in hem/onc and in other areas, of course. So with respect to the competitive landscape, there are other folks who are pursuing these pathways. But as I described, I think when you look at the efficacy potential here, the safety profile and the dosing may add up to a winning combination. It's a different area, of course. But in some ways, it's analogous to what we saw with SKYRIZI, where we saw a molecule with best-in-category potential and a number of additional advantages in a space that we know very well. And folks were initially skeptical that, that could translate into a differentiated product. But I think if you look at how both the clinical data have turned out and how the product has performed, it has shown very, very strong differentiation. And I think a lot of those same features apply to this program. The deal also brings us to other clinical-stage assets, which are slightly earlier, but making good progress, which are also CD3 bispecifics, so T-cell redirecting bispecifics against CD37 and 5T4. So another hem asset and a solid tumor target, which is very, very nice and allows us to continue to build in a space we know very well and take this promising technology with a platform that we know is active into solid tumors where it's been more difficult for others to show activity. So all of that, I think, makes it very attractive. And then there's a discovery component as well where we can use AbbVie targets on Genmab technologies and Genmab targets on AbbVie technologies. We'll jointly evaluate and select those and advance potential future candidates as well. So we're very excited about the potential of the deal.

Great. Maybe 1 or 2 follow-ups is, one of the other questions is just moving these bispecifics to earlier stage patients, particularly on the CD20 space for lymphoma. How do you guys think about that? And obviously, assuming your near-term registration trial would be in late stage patients. But is there an opportunity to move to earlier stage patients? Do you think the safety profile supports that?

So typically, one pursues initial registration in later stage patients, as you described. And we certainly will be pursuing registration in those patients. But absolutely, we think there is potential in earlier therapy. And I think both the efficacy and the safety profile that has been demonstrated to date [indiscernible] so the safety profile is very consistent with moving to earlier lines.

Okay. Great. Just in the interest of time, wanted to quickly get to SKYRIZI and RINVOQ. Obviously, very solid launches for both products. Maybe just as we think about the forward outlook here, the label expansion is obviously a key part of the story for each of these assets. So would just be curious, what are the key readouts that we should be focused on here on the forward in the kind of last several minutes of the fireside?

So Terence, you're breaking up. I want to make sure I understood the question. It's what are the key readouts in indication expansion?

Yes, for SKYRIZI and RINVOQ, yes.

Okay. Got it. So for RINVOQ, one of the key data readouts will be the atopic dermatitis, which is coming midyear. That's important as well and takes us into a new space that we've not previously participated in as a company. It's one where we have very strong Phase IIb data. One where I think there's a real market opportunity, both the ability to expand the market to treat frontline patients and to treat patients who haven't adequately responded to the one of the therapy out there. So we think it's a broad opportunity, and we think it's very -- one that will be an important addition to the profile of RINVOQ. Although the data is already out, I would point out that a key component of the indication expansion for RINVOQ is psoriatic arthritis, where we've already announced strong Phase III data and are moving towards registration, and ankylosing spondylitis, where we also are moving to registration based on data that we already have in hand and have already presented in major medical meetings. And so those will be important additions. And those really round out the rheum portfolio for RINVOQ. There are IBD components to RINVOQ as well. Those are a little further out in time with data coming in more the '23 time frame for Crohn's and for IBD. If we turn to SKYRIZI, the indication expansion program there takes us into some new areas like inflammatory bowel diseases where we ought to have the induction data from Phase III towards the end of this year and maintenance data next year with a filing next year in Crohn's disease. And then we also have an ongoing ulcerative colitis program as well, which is a little bit further out in time. And then we'll also have psoriatic arthritis data, which will round out the profile there. So those, I think, would be the top readouts.

Great. Maybe anything else in the pipeline that you'd flag in terms of upcoming catalysts that should be on our radar?

Well, I think it would be important to look at the early oncology portfolio. We've done a lot to build that with internal innovation as well as through partnerships and external innovation. A number of our internal programs in apoptosis are advancing very nicely. Navitoclax, we've already announced, will move to Phase III studies this year. The move to get those studies up and running is underway. But we have programs like ABBV-155, which is also an XL inhibitor, but it's a B7-H3 targeted XL inhibitor, so it's an ADC of sorts, but one that delivers a molecular warhead. That will complete its monotherapy work this year and combo work next year. We could see efficacy data at either of those 2 components. And that's a very promising program because what it allows us to do is to get to much higher levels of XL inhibition than you can achieve systemically. And we know that you can treat myelofibrosis based on the work we've done with navitoclax with systemic administration. But to get into solid tumors, we think it's going to take that targeting. And so that's a promising program because we know those pathways are active in a number of important solid tumors. We have other apoptosis programs that are a little bit behind that, so more next year. But that could also provide very compelling data. And then we're making good progress with our I/O programs as well.

Great. Well, I think we're up on time. But Rick, Mike, Rob, thank you so much for your time this morning. We really appreciate it. And best of luck over the coming months.

Our pleasure. Thank you.

Thanks, Terence.

Thanks.

Thank you. Take care, everyone.