Agora S.A. (AGO) Earnings Call Transcript & Summary

Good morning, ladies and gentlemen. We welcome you at the meeting, or I would like to say, teleconference concerning the financial results of fourth quarter of Agora and also in 2019 year. And today, we have the teleconference, and we are with you in full composition of the Management Board. And so our company, of course, the management -- the company works -- Anna Krynska-Godlewska, Grzegorz Kania, they work from home so they are connected by phone. Tomasz Jagiello was in Warsaw. We have the headquarters of Helios there. Helios was closed by the administrative decision. So Tomasz with his team minimizes the effect of this decision on our result. Agnieszka Sadowska and me, Bartosz Hojika, I am Czerska St., where we always meet. But today, unfortunately, we can only hear each other. So I think that it will be the most reasonable if the results of the fourth quarter and of the entire 2019 we can treat in a nutshell because today, we are concerned about some other things. But of course, presentations we prepared for you with all the numbers and comments to them is available on our website. So of course, you can refer to this presentation and also to our report, entire report. And all the matters that you would like to ask about in detail, we will try to answer these questions in the second part of today's meeting. Ladies and gentlemen, as I have said already, we are here absorbed by some other concerns. But taking the liberty of this opportunity, I would like to say that we have this feeling that 2019 was a very good year, the best year for Agora for many, many years. I will risk even saying that, that was the record year. So we equalized our record of revenue. So that is the year in which all the businesses achieved record results, financial results. We will talk about it in a moment. So that was also the first full year of realization of our strategy, development strategy in which we realized a number of very good investments, acquisitions. So the biggest one in -- the biggest investment, 40% package of share in Eurozet Group. And if we receive the permission from the consumer -- from the Office of Consumer Protection and Competition for the remaining 60%, then this will be the biggest investment of Agora in media for over 16 years, but also the biggest acquisition in the history of our company. But in the same time, as you know, we realized also the restructuring process, among others. We closed our 2 printing houses because Gazeta Wyborcza is beating the records of digital subscriptions. But we have fewer copies -- fewer paper copies, and also, we have lower volumes from the external customers. So that is why such a big restructuring project that we realized last year. I would like -- because of this, I would like -- as I have already said, so we'll come back to our current affairs. But I would like to take the liberty of this situation and I would like thank you for this year, first of all, to our team of Agora, employees of our group, to say thank you to our customers, partners, users, readers, listeners; and also to say thank you to you, that every quarter, you also support us, you keep your fingers crossed. So we could see it brings results, tangible results. Now I propose to move to Slide #5 of our presentation. This is the only slide that I would like to stop in the context of the fourth quarter and also the last year. So the total revenues of our group in the fourth quarter amounted to PLN 378 million. They were higher by 9% as compared on a year-on-year basis. And that growth, it was thanks to higher inflows from the advertising services and the catering activities. The revenues from the sale of advertising services increased by 14% on a year-on-year basis, and the biggest increase happened in the Internet, thanks to Yieldbird company. They were higher also in outdoor advertising because of the development of carriers, Citylight and Digital, and also the acquisition of MoveTV platform and also in film and Books segment, mainly Helios network. So the revenues from the advertising services was lower in Press and Radio. And here, we have to notice that as for the Press segment, the dynamics of the revenues were affected also by the limitation of the number of titles published. But in Radio, it was related to lower revenues from the sale of the antenna time, but also because of the lower sales of our own advertising space. And as for the revenues from our cinema activity in the fourth quarter, revenues from the sale of tickets in Helios decreased by 1.5%. And at the same time, in Helios, in calendar terms, we sold 4 -- over 4 million tickets, so it means by 4% less than in 2018. But as box office, the attendance in Helios was on the similar level as last year. So also, there are other factors like the average price of the ticket and also the revenues of the bar sales. They increased by 8%. That is the effect of the increase of the average prices in the bars. So the value of the sale of publications amounted to PLN 38 million and increased by 5% as compared to the last year. And it resulted mainly from the increase of revenues from the sale of publications, Agora publications, also the revenues from the paid subscriptions to the content of Wyborcza.pl. At the end of 2019, the number of digital subscriptions of Gazeta Wyborcza amounted to 218,000. The revenues from other sales amounted to PLN 25 million. And they were high on a year-to-year basis, thanks to the catering business and also the increase in the outdoor advertising. In the fourth quarter, there were lower revenues from the sale of printing services of the entire group. So it's nothing surprising. This is the effect of closing in mid-2019 to printing houses out of our free printing houses and also the decreasing volume of orders for the external customers. The revenues from film activities was PLN 4 million, and they are increasing compared to 2018. And this resulted from the bigger number of new titles in the film distribution. And in the fourth quarter 2019, NEXT FILM introduced 3 Polish productions inspired by the historic events: Ikar - Legenda Mietka Kosza, and documentary, Kult, the band. And there were also other films from the previous periods. The operating costs in the fourth quarter increased by 7% to PLN 355 million, and the increase was caused by the development activities and result -- and it came from Internet, film and Books and outdoor advertising. The jump of operating expenses was in businesses with lower revenues. It means Press. And starting from the third quarter of 2019, the Press also includes the restructure of the printing activity and also in Radio. The biggest item among expenses is the cost of foreign services by 23% higher than in 2018 and the increase especially in the Internet segment, which resulted from the higher expenditures on the lease of advertising space by Yieldbird company. They were also higher in film and Books segment because of the higher costs relating to film and catering activities, the cost of lease in cinemas and also the fees for the copies and also the external advertisements. Payroll costs, PLN 89 million. This has increased by 2%, and it resulted mainly from the increase of this category of expenses in film and Books because of the development of Helios network and also the catering activities and also in external advertising and Radio. And then inflation in other operating segments of the group were related to lower employment. And then when we talk about the full-time jobs, so at December -- at the end December 2019, and it was 2,495. That has decreased by 216 as compared to 2018. So the job resulted mainly from the lower employment of the restructure for printing activities and press activities and also supportive segments. But the increase of employment happened in the segments film and Books and also in outdoor advertising. The drop of the daily consumption of energy and materials and the sale of sold materials and goods as compared to the fourth quarter of 2018 resulted from the limitation of printing activities after closing 2 printing houses. And this category of cost increase in segments film and Books because of the development of catering business and also printing popular book titles and higher revenues from the sale in the bars -- cinema bars. The cost of the amortization increased by 5% and amounted to PLN 24 million. The biggest increase was in film and Books segment, which resulted from the higher number of cinemas, development of catering business and also amortization of co-producers contributions within our film activities. And the representation and advertising costs amounted to PLN 28 million, and they were higher by 19% as compared to the last year, especially film and Books contributed to it because of the advertising of very popular book titles that we distributed at the end of the year and a big number of the films that were in distribution and also in the segment of outdoor advertising. But the drop was noticed in Radio, Press and in Internet. In summary, the fourth quarter of 2019 reflects the increase of revenues, especially from advertising activity. So we improved our results on EBIT level and EBITDA level. The profit of the growth on EBITDA level increased by 15%; and on EBIT level, exceeded PLN 23 million. On Slide #6, you will see the information about the events contributing to the comparability of the results between years. And moving to Slide #7, I would like to say one sentence about each of our business segments, which is what's the most important. And first of all, moving to Slide #7, film and Books segment, I would like to say that in the fourth quarter, the results of that segment were worse in 2019 because of the loss resulting in film activities and also the catering activities. But the entire 2019 was very good for this segment, especially for Helios, which generated record financial results and increased its market share. Also, it was a record film for NEXT FILM, which beat the record in terms of the turnout. And Slide #8, we present the results of Press segment. Here, I would like to say that we improved the financial results in the fourth quarter and also in the entire 2019 year. This is not easy on this difficult market, as you know, observing our results for many years. Secondly, I would like to emphasize once again the number of the digital subscriptions. We ended the year with 220,000. And now we are working still on the systematic improvement of the average monthly income from the subscriber in 2019. This revenue about the digital subscription was PLN 14. This is the increase by 40%, almost 40%. Slide #9, the results of outdoor advertising, which also ended the year 2019 with their record operating results. Here, we have to emphasize that the results exceeded our expectations, our investments in MoveTV platform, in digitization projects of this business segment. Also, the record results on EBITDA level were Internet revenues, propelled by the dynamic increase of our advertising champion program, means, Yieldbird company, which ended the year 2019 with record. And Radio, which noted in 2019 a slight drop of the market share. So this is the effect of the increased expenditure on the state-owned companies on radio in 2019. And a report by [indiscernible] analyzes the expenses of the state-owned companies over the recent years. So we can see in his report that over the last 4 years, the expenditures on radio doubled in terms of the state-owned companies. And this is the second item after -- the television is the biggest item in terms of the advertising expenditures of the state-owned companies compared to all expenses on all other media except for this television. And also, it results from the bigger activity of the leader on this market, means RMF radio. So this is the reaction to our investment in Eurozet. Ladies and gentlemen, on the last slide, #12, we summarized our progress in the realization of our strategy. We realized the majority of our assumptions for 2019. And it was very important throughout 2019 that we maintained our position on the planned path. And now we enter the turbulence period. So we are convinced that this will be temporary. So the presentation, as you know, is available on our website with our comments. So we'll try now to answer all your detailed questions, both in terms of 2019 year and also the current situation.

So I will start from the questions that we received before the conference. And the first 4 questions are for Tomasz Jagiello. So by how much the revenues of Helios will be lower by -- because of the closing of the cinemas for 2 weeks? Can you catch up with this loss in the coming quarters? Does it depend on weather, which will be very good starting from spring to winter? And whether the drop of revenues will be translated into the drop of profitability because it will not be possible to lower the fixed costs. And these are the 3 questions resulting -- concerning cinema. The last question refers to NEXT FILM.

So this is the answer. The company Helios does not have -- and I mean in this period, we can't see any threat as for the results. So because of this these 2 weeks, so slightly we have to define the costs. So today, the significant part is [Foreign Language]. Today our costs -- we estimate PLN 1.2 million, PLN 1.3 million, PLN 1.5 million as the loss to the results. So this is this period. And when we talk about the 2-week period of weak time, so it will not affect. And this is good result, and we can catch up with it. We can see a kind of shift of premieres than the disappearance. Sometimes we have a situation of lower turnout, but still the titles are there. So the dates of the premieres are changed. So after the closing period, the cinemagoers can rego to the cinemas. So is it the answer to the question?

The next question refers to NEXT FILM, so whether the coronavirus infection can affect the results of NEXT FILM. So one premiere was postponed of one of the distributed films. Could we have more postponed?

So for the NEXT FILM, that was the [ Horror in Forest ], that's -- no one can sleep in a forest now. So that was one postponement. We are not envisaging any other changes in the forecast. So we will show this film in a suitable time when the cinemas are open and will be available to the goers.

So these are all questions. The next 3 questions are for Agnieszka Sadowska. How much in the current year will be the dynamics of the advertising market? And by how much it can be lower because of the coronavirus? And in which channels the drops will be the biggest? And whether some advertisers stop their campaigns?

So the -- I would like to know the answer to the first question. So everybody thinks what the dynamics could be. And as for what we can see, there's a slight drop in the 3 categories. This is tourism, transport and the culture events, for obvious reasons. But these will be just a shift for the event. They are not canceled. They are just postponed to some later time. And the advertising industry is kind of in the state of expectation. So we all wait what the periods can bring.

Then other question to Agnieszka. This is about the sale of equipment in the closed printing houses. Are there any news about it?

So we managed to sell single equipment for PLN 2 million, like chains or other components. And the rest will be subject to scrapping.

The next question is directed to Anna Krynska. And it refers to the investment plans of Agora. Whether Agora takes into account in the coming period big acquisitions? So Interia Group is for sale. So is it an interesting investment for you?

Of course, we are not commenting on the talks that we are having, so I will not be talking about the acquisitions. But in such moments, the beginning of the crisis, so we take the breath and we recalculate our models, and we see how the market changes affect our targets. So in addition to the risk analyses and the impacts of such crisis, we see some opportunities in them, in fact.

The next question is to Agnieszka Sadowska. At the beginning of last year and this year, Agora made a write-off regarding Goldenline. So what are the priorities regarding this company, the holding of the revenues or the regaining of profitability?

So we managed to hold the drops, say, in Golden. But the results are not satisfactory, and we are working on this, that the company generates growth.

The next question refers to Eurozet. This is the question to Anna Krynska. As for the acquisition Eurozet, are you evaluating this in such a way that this year, you can manage to take over the remaining shares? Will you be introducing changes in the functioning of radio divisions of Agora and Radio ZET through, for example, having the joint newsroom?

So first of all, the answer to the question whether we can see the takeover of the shares this year, of course, it depends on the decision of the Office for Consumer Protection and Competition. So after maybe holidays, we can have this discussion. But we can't see any reason now to change our previous statements and our willingness to buy these shares. The second part of the question referred to -- yes, referred to the changes in the functioning of the radio and radio divisions of Agora and Eurozet through the creation of a common newsroom. So we're not thinking about such changes until the moment we can receive the decision from this Office of Consumer Protection and Competition. So I will not be answering this question with your permission.

The next question is to Agnieszka Sadowska. How are you evaluating the level of sales of the printed copies of Gazeta Wyborcza when you compare the digital subscriptions? Is the result satisfactory in financial terms?

The sale of the copies of Gazeta Wyborcza versus the previous year, it means 2018, dropped about -- dropped in the same time as the weekly market drops. This is 9%. But in terms of revenues, they are not dropping because we increased the prices, and we are in a position to leverage the drops in sales through the increase of prices so these inflows are stable. And I think that on this difficult market, we are satisfied.

The next question refers to the radio advertising markets. So what are the forecasts for this year in terms of this radio advertising market?

And this is the CEO, Hojka. So yes, we evaluate this radio advertising market is okay, its condition. So this market has increased. Our share in this radio advertising market decreased for reasons that I have mentioned already. And as for our forecasts on the advertising market in 2020, so the most reasonable and responsible strategy today is to refrain from giving the answer.

Another question to CEO. How are you evaluating the market of podcasts in Poland? And what are the challenges for its monetization? And what is the challenge for the year?

So we think that this market has big potential, and we think -- we have thought so for some time. So it was visible in our strategy that we announced in mid-2018, when, among other things, we said that one of our strategic goals as a group is 30,000 paid subscriptions of the Radio TOK FM, which, among all our businesses, is the most specialized in the production and distribution of podcasts, but not only, with big success. Also, following this example -- and also Gazeta Wyborcza also is publishing podcasts and it's very popular. But coming back to radio because we are realizing the strategy -- we are realizing the strategy for some time. And this strategy, we are proud about this strategy. We organized even conferences for other advertisers to share our experience because this is a unique experience of the radio broadcaster. At the end of 2019, we have 20,000 paid subscriptions of Radio TOK FM. So the goal of 30,000 for 2020 is not threatened, but we expect that the number of those paid subscriptions of Radio TOK FM in 2020 will be even bigger than we estimated in our strategy. We believe that this market has big potential. It is also developing in its specific ways, characterized by big dispersion. But today, we have this feeling, which is confirmed also by the figures, that we found our idea, our effective way of competing on this market and then using this bad trend -- good -- sorry, good trend from the market.

The next questions refer to Eurozet, and this is a question to Anna Krynska. So how Agora is evaluating the financial results of Eurozet for 10 months, in the period from 20th of February to December 31? And when Agora is expecting this decision of this Office of Consumer Protection and Competition to take over the remaining 60% of shares?

As for the result of Eurozet, so we evaluate them very well. But I would like to point out that as for the net result, our share was decreased by amortization of goodwill. So this result, you could see a much lower decrease, about PLN 9.7 million. And as the revenues and this net result of the company are very -- are characterized by big growth as compared to previous year, these are much better results. So big congratulations to the Eurozet management board and to all employees contributing to such good results. So we keep our fingers crossed that this trend will continue.

So the next question refers to the value of our -- in Gazeta Wyborcza. So we skip this question. The next questions concentrate around the Helios network, and maybe I will present them all. So it means what's the impact on film and Books will have with the closing of Helios for 2 weeks? And what will be the loss of revenues and whether the employees will be rewarded through this period with remuneration? And I think that this set of questions we have from 4 persons. So Tomasz Jagiello, would you be so kind to answer these 3 questions?

So PLN 9 million revenues in Helios network. But as I have said, PLN 1.2 million, PLN 1.3 million is contribution to the results. And the characteristic feature of the cinema business is that a big number of persons working in the cinemas are employees. They are on the flexible employment terms. So the costs disappear automatically together with the closing of the cinemas. But of course, the employees on permanent employment will receive remuneration for this period. And this is a very significant part of our costs, which the company has to overcome in this closing -- closed period.

So I think that this exhausts major questions. So it means the impact on the margin during this closing period. So they were the questions about variance and different periods.

So the situation is not changing. So the -- so for obvious reasons, these are the consequences of the government decision. Of course, we have legal opinions, and the lease fees will not be paid for this period.

So now the question, general question not relating to the closing of the cinemas but more relating to the pricing policy of the cinema network. So the question was why such aggressive behavior of the competition on the cinema market saw drastic drops in prices?

I would say it in this way that the very attentive observer of the market can see the drops of the prices of smaller scale, like in February and March, so it was in Poland for 0.5 year. So the initiator was Multikino of such policy and Helios just reacted to it. So what is the reason for this? On the cinema -- European cinema market, that was the response to lower the price -- that was the response -- model response to the policy of our networks, which introduced the subscription systems. And the 2 loyalty systems were shaped with the lower price of the long-term subscription programs. And also, it was transferred to Poland this competition attracting the customer. And the majority of [ concert ] opted for lowering prices, Cinema City. So these are subscription systems known -- unlimited program known to you. So we can say that this is the source of the appearance of such pricing policy. But as for the aggressiveness, I would say that the response is quite easy here because the cinemas are reducing the prices because it is profitable for them. We -- and now that this is the intuitive context, and this is maybe towards the price war, but this is because we are a country of very high price sensitivity. And Helios [indiscernible] prior to this announcement, was in the zone of low-cost cinemas. And in the 12 cinemas, that was the 20% turnout drop. But in all cinemas, we observed the profitability. So that is why we can see the effect in our quarterly report. So we have more than national average the increase of profitability and turnout because of the increase of the bar sales. And I understand that this will -- could be the intuitive context, but the response is easy. Because it is just profitable, it pays off.

So in this way, we've exhausted all the questions regarding the Helios cinemas. Maybe there will be more questions. Now we have the question regarding, generally speaking, the intentions of Agora. And this is a situation -- whether it is an unstable situation on the cinema market and advertising cinema and also the financing of Eurozet, can they postpone the payment of dividends?

As of today, we can't see any reason that we can say that coronavirus is the reason for suspending or changing our policy, dividend policy.

So over the last year, did you observe the sale of paper copies of the Gazeta Wyborcza and whether the appeals of the government to the society to stay at home could, in your opinion, affect negatively the sale in the coming weeks. And if yes, so how would you react in terms of costs?

We do not have full data from this week, but I think that we can see slight increases, not decreases. Of course, we have increased in subscriptions and I would say that this is a big increase. And we are also observing our colleagues from Italy, which we are in constant touch with. And we can see that there, the increases of subscriptions in this period were even 20%. So also in Italy, papers is still sold depending, of course, on the distribution points. If they are not limited, so there will be no impact -- negative impact. But we can see also a big need from the society just to reach this information not only in digital format but also in paper form, physical form. There is also the prepared special supplements together with the government, which were done originally distributed to the people's homes. So we think that there will not have drops, or if the distribution points will be reduced and we have increases on the subscription and they will be continued.

So I have a question regarding the film market. So in addition to the James Bond premiere, are you expecting that other also titles like blockbusters will also be postponed or even canceled?

This is announced. And the openings of the new titles are postponed. But this [indiscernible] from 2 coming openings and is observing the development of the situation. So I think that these are good decisions when we have just the end of this mess, so then we can count on the revenues coming from these titles that are postponed.

I have a question regarding prices of cinema tickets after the recent lowering. So how these price -- how long these prices could be at the level of PLN 15? And how it can affect the profitability despite of it?

So I think I've answered this question already. And I also say that if it turns out that the sale of tickets, PLN 15, results in bigger profitability of cinemas, so we would like to -- this trend to continue. So the price of 15 tickets -- or PLN 15 tickets is not the problem because more people come to the cinema, more people buy in the bars, and our experience confirms that we have high margin.

So I think that these are all the questions about financial leverage connecting with prices and with the schedule of openings and closings of cinemas. We have questions regarding the resignations or the postponement of the advertising campaigns in the recent time. So what is the scale and how the ordering parties explain their decisions?

So these are more shiftings, as I have already said, point suspensions. And as I said, the advertisers are waiting what the coming weeks will bring.

Agora is active on fusion -- on the merger and acquisitions. So the situation the capital markets will freeze such transactions, will you see it after the talks that are conducted by the Management Board? And will the situation which is caused the coronavirus can affect the investment plans of the group not connected with the acquisitions? And Anna Krynska, could you please answer this question?

Of course. We see certain slowing down of talks. But maybe resulting from that, we are still recalculating our models and we are analyzing the chances and the risks and opportunities. And as for the questions whether we can see any threat in slowing of the talks, we can say no because business is as usual and everybody is focused on calculations and to calculate the profitability of the investment projects and whether it will be on the desired level. And as for other investments, so maybe I will give the floor over to Grzegorz or Bartosz. But I would like to say -- I would like to make one correction regarding amortization. I said that this is the amortization of goodwill, PLN 17 million that you could see in our financial reports of Agora. As for the net profit [indiscernible] so it was reduced by PLN 19.7 million, not by amortization of goodwill but by amortization of assets when we recognized the purchase price. And it only mainly results from the lowering of the value of concession to the fair value.

So that's all I think. And I think that we addressed all questions that appear because part of them were just around the same issues connected with the closings of cinemas. So if you don't have further questions, and I can't see that there are further questions received by us -- oh, I'm sorry. We have additional questions in the meantime. So I am just quoting them. So I have a question regarding the negotiations with banks regarding the attracting financing for Agora Group. How is the Management Board evaluating the end of these negotiations? And whether the Management Board envisages the difficulties in attracting such financing? So Grzegorz Kania, I would like to ask for delivering the answer.

Thank you very much. As we informed many times, the negotiation started in March last year and they are still on. [ I cannot hear. ] So it's hard to say -- so we don't -- have no other needs. So we give some time for quiet negotiations of the best possible terms.

Next question. What is the current situation? So can you see now any room for changing the strategy in terms of the investment outlays, in particular, in the area of mergers and acquisitions and cinemas? And what is the acceptable level for Agora of net debt in the short term and long term? So Grzegorz Kania, could you please answer the second question?

Net debt in 2019 amounted to PLN 100 million. Precisely, it was PLN 12 million if we add the short-term obligations. So I wouldn't change our position in terms of the net debt. So we said that the target is -- that it will be on the level of 2x EBITDA. So we assume that it can -- 2.3x EBITDA. This is what we envisage in our strategy.

The next questions. So we have questions regarding cinemas. So we'll not come back to this topic. So the question is what is, statistically speaking, percentage of the cinema turnout in a year goes to March and April on the basis of the previous years if you compare it to the previous years?

As you know, so the season starts in September and ends in March. So if we have some turbulences in cinema, so most likely, our most possible model is that April and May are the weakest months. March is still okay. And today, we can say that March is okay, 9% to 10%; April, 6%, 7% -- 6%. [Technical Difficulty]

So Mr. Jagiello has a problem with the telephone connection, so we will elaborate on this question in writing because we cannot hear him properly. The next questions are repeated as for Interia, acquisition of Interia, and also maintaining the cinema prices. I will move to next question. So how the printing house of Agora is prepared for such employees, when there is a suspicion of coronavirus? So can it be like this that Gazeta Wyborcza will not be printed because of coronavirus in the printing house?

In the printing house and also in Agora, we have very rigorous measures, security measures. We have disinfection, cleaning surfaces and so on just to limit this risk. And we have also the minimal team that we have for emergency situation when it turns out that someone in a printing house is infected with coronavirus. But we are talking with all others -- with all other printing houses just to give support to each other. So if it turns out that we have the coronavirus in our printing house or there is coronavirus in other printing houses, so we'll cooperate just to print newspapers. So this is -- we are cooperative and supportive.

The next question is about Yieldbird. So how the planned limitations to third-party cookies can affect the Yieldbird operations?

We analyze how this third-party cookies is going to affect the market. It's almost likely to influence the retail gaming companies. And the biggest beneficiaries should be these companies which have -- could be publishers. Yieldbird cooperates with publishers. And at this moment, we don't have the negative analysis, but we are looking at it, and we think that this is also a chance for Gazeta Wyborcza, for Gazeta.pl which have their own users. And we can base our research on these users because there will be the problem of measuring the market because there will be -- because the sources of the third parties will not sum up.

So the planned openings of the cinemas and the restaurants in 2020 will be postponed because of coronavirus? So this is the question to Tomasz Jagiello or Anna Krynska.

So of course, we are in touch with the openings in the shop malls. So if the cinemas are to be opened -- we don't see any problems, not because there are problems with -- on our part. And -- so it's too early to assess whether this economic turmoil can affect the openings. So it's too early for us to evaluate these impacts on our investment calendar.

The next question is like this, whether it is reasonable to lower the prices in Helios cinemas if, after a few weeks of closed cinemas, the cinema goers can miss the cinemas so they will still go. So why the company is introducing this offer also in cinemas in cities? And here I think the rest of the question is in which there is no competition.

So as for the lowering of the prices in cinemas, we are led by competition. So we cannot -- as I have already said that we know that the lowering of prices causes certain consequences. And also we conducted our research in our network also where there were monopolies. So the lowering prices increased the profitability, higher turnout, higher bar sales and higher sale of tickets. So we think that it will not be reasonable that in the bigger cities where there is more competitive market that we use a lower price and in the cities smaller, where we are alone, that we take advantage of this dominant position, and we are not decreasing the prices. So we think this is not proper behavior. That is why the decision on lowering the prices was the decision of the entire network. And as for whether the openings of cinemas could cause the increased turnout and that we can increase our prices, so let's maybe wait because the return of the viewers will take place in some time. So first of all, they should return to the cinema so the situation is calm. And then we can just balance the supply and demand.

And the last question, whether the scrapping of the printing equipment, which couldn't be sold, will it result in the write-offs and what the value of them could be?

I will answer this question, Grzegorz Kania. So the sale of the printing equipment. So this value has already been written off in the previous period. So the scrapping of this equipment will not have any influence on the financial results of 2020. And so we expect minimal positive impacts resulting from the scrapping -- from the revenue -- scrapping revenues. So we will do that as on the loss of value and it was taken into account so the deviations could be minimal. So minimal impact on the results.

One more question, whether the Management Board will introduce the motivations based on the shares quote of all employees or only for the Management Board? So could you comment whether the changes in the share prices will change the assumptions for the motivation program?

So I would like to say that over the recent days, it's nothing -- it's not something that we focus our attention on. But of course, I would like to emphasize that today, we can't see any reasons for changing our long-term strategic goals because we expect that all the problems that we could face will be temporary. And of course, we have to think about the possibility and the date for calling the shareholders' meeting. Our status does not allow us for the distant remote participation. So most likely, we'll make a decision about the postponement of this general shareholders' meeting.

So these were all the questions that we received. So if you need additional -- any information, so please write to us an e-mail so we'll send you all necessary information.

Thank you very much for your participation and also for all the questions. And we hope that our answers exhausted your questions, that we delivered the information that is possible as of today. Thank -- we wish you health, calmness, and in 3 months, we can see each other here after the next quarter to discuss our results in person in our headquarters in Czerska St. Thank you very much, and see you. [Statements in English on this transcript were spoken by an interpreter present on the live call.]