Avon Technologies Plc (AVON) Earnings Call Transcript & Summary

Good morning, ladies and gentlemen, and welcome to our 2020 year-end results. Before we start, I'd just like to thank David Evans, who joined the Board in 2007 and served as Chair since 2012. He's retiring from the Board this morning and will be replaced by Bruce Thompson as Chair. I'd like to thank David for his service and support over what's been a remarkable period for the group, and we wish him all the very best for the future. For our presentation this morning, I will start with the key highlights. Nick will present the 2020 financial review and 2021 outlook, following which I will provide further thoughts regarding the medium-term outlook, before closing with the key takeaways. We will then take questions from those of you who've dialed in, followed by questions from those of you that have logged into the webcast. 2020 has been an exceptional year for Avon Rubber. We've delivered strong profit growth ahead of expectations and refocused the business as a leading provider of life critical personal protection products. Over the last 3 years, the consistent delivery of our strategy has built a broader, more visible, longer-term contract portfolio to position the business for growth in 2021 and beyond. Organically, we've continued to focus on maximizing sales from the current products and complement with selective product development to expand the wider portfolio. During 2020, we've secured new multiyear sustainment contracts to supply the U.S. DOD with M50 masks, M61 filters and associated spares and accessories to support the 2 million masks in service. Additionally, we further broadened our respiratory protection customer base through a 10-year contract with NATO to supply M50 mask. We've also delivered a strong year in First Responder due to increased demand for respiratory protection and greater use of the products as a result of the global pandemic. To complement our organic growth, we've continued to target selective value-enhancing acquisitions. Helmets & Armor, which completed in January, was a milestone acquisition and has significantly expanded our portfolio with the addition of ballistic Helmets & Armor. The business has made excellent progress since completion, securing multiyear contracts with the DOD, and the integration process is on track for completion by the end of 2020. The divestment of milkrite | InterPuls was a significant step in our strategic development focusing the group on life critical protection products and providing funding for capacity for future acquisitions. The acquisition of Team Wendy in November is a further important step for the group, creating a global leader in helmets. The combination of Team Wendy and our Helmets & Armor business provides increased growth opportunities from a broader product range and an enhanced customer base. I'm delighted with the progress made to date, which is delivering a broader range of opportunities and adding value for all the group stakeholders, all of which leaves us well positioned to deliver further growth in 2021 and beyond. COVID, for most companies, 2020 has been defined by COVID, which has made this an unprecedented year. Whilst our results have been positive, this does not mean we're immune to COVID. So I wanted to just take a few moments to discuss our collective response and the decisions we've made to manage and navigate this crisis. We have continued to prioritize the safety and well-being of our employees and their families as our primary focus. We updated our sickness policy and have paid full wages to all employees who could not attend work during this period through either illness or isolation. We've also moved nearly 20% of our global employees from our sites, so they've been working remotely since March and removed all our high-risk employees on full pay. Our liquidity position has been strengthened throughout the period, and we entered 2021 with a strong balance sheet and our new longer-term $200 million bank facility. We've also ensured we paid our suppliers on time and helped prepare their COVID defenses in our supply chain. It's thanks to the dedication and resilience of our employees that we've been able to support our customers, maintain our operations and supply chains and deliver these strong results whilst overcoming this level of change and Disruption. To meet the challenges of a wider and more U.S.-centric business, I've evolved the structure of the leadership team, so the key business leaders and global operations and supply chain leader are based in the U.S., which will also help us to overcome travel limitations from myself and Nick in the near term. When you look at our COVID response, I'm hugely proud that we did the right thing at the right time. This has resulted in a more resilient progressive and agile business that has delivered exceptional results and shows we continue to evolve and progress as a global organization. In 2017, we launched our investor proposition and so these are the KPIs you should measure us against. As you can see, broadly, it's another good set of numbers. We continue to make progress, and we remain confident in our ongoing commitments across these targets. With that, I'll hand over to Nick to provide more detail.

Thanks, Paul, and good morning, everybody. So now turning to our year-end numbers and our outlook for next year. I'm delighted to present another strong set of results today. The results shown on this Slide are for the group's continuing operations including the first 9 months of contribution from Helmets & Armor, but excluding milkrite | InterPuls, which was divested at the end of the year. To give you the full picture of our performance, we've also included the organic constant currency growth rates, which exclude Helmets & Armor. Revenue growth of 30.8% comprises flat organic revenues at constant currency, the first time inclusion of Helmets & Armor revenues of GBP 40.8 million, offset by a small currency headwind of around 1%, with the average exchange rate for the year of $1.275 to the pound. Moving further down the slide, you will see, once again, that we have continued to grow our profit ahead of revenue. With an adjusted EBITDA of GBP 38.4 million, a 35.2% increase on last year, with an organic increase of 6.8% in addition to the Helmets & Armor EBITDA contribution of GBP 7.3 million and an EBITDA margin of 17.9%, reflecting the initial cost synergies. On an organic constant currency basis, the EBITDA margin increased by 140 basis points as a result of improved product mix reflecting commercial pricing of the new M50 and M53A1 contracts and the strong increase in higher-margin First Responder revenues. Looking at EPS, the strong organic operating performance and first conversion from Helmets & Armor offset the increased adjusted tax rate of 17% compared to 8% last year, resulting in an adjusted EPS of 76.5p, an increase of 13.8%. Cash conversion of 84.9% was a little below our 90%-plus target due to the working capital outflow in Helmets & Armor as a result of the transitional arrangements for 3M. Organic cash conversion was 123.3%, well ahead of our normal expectations, reflecting collection of the $16.6 million Rest Of World receivable, which held back cash conversion last year. Following completion of the milkrite | InterPuls divestment, net cash was GBP 93.2 million at the end of September. Our ability to generate strong returns on capital employed continued with another excellent return of 22.7% in the year. So reflecting our confidence in the outlook for the business for next year and beyond, we have proposed a final dividend of 80.06p per share, resulting in total dividends for the year of 27.08p. This is once again up 30% on last year and in line with our progressive dividend policy. I now want to talk a bit more about our revenue growth. As I've previously mentioned, revenue increased by 30.8%, reflecting the acquisitions of Helmets & Armor, flat revenue on an organic basis and small currency -- and a small currency headwind. Military revenue, down 3.6% was offset by First Responder revenues, which were up 7.8% notwithstanding our exit from the Fire SCBA market at the beginning of the year. On an underlying basis, First Responder revenues were up 23%. And U.S. DOD revenue of GBP 58.9 million was up 7.5%, benefiting from a full year of deliveries for the new M69 and M53A1 contracts and an increase in M50 spares and accessories. Rest of the World Military revenues of GBP 23.9 million were lower than last year as a result of 2019, including the $16.6 million Rest of the World contract. The exception of underlying First Responder growth of 23% was driven by a strong increase in demand as a result of the COVID pandemic for both original equipment, particularly masks as well as replacement filter spares and accessories. Now moving on to look at our strong balance sheet position. As you can see on the right-hand side of the slide, our year-end net cash following the divestment of milkrite | InterPuls and the GBP 20 million one-off pension contribution was GBP 93.2 million. Before deducting lease liabilities of GBP 22.8 million, cash less bank borrowings was GBP 116 million, more than sufficient to fund the purchase of Team Wendy in November. And following the Team Wendy acquisition, we are left in a small cash position. This, together with our new $200 million medium-term bank facility Provides both short-term liquidity and funding to make further value-enhancing acquisitions in due course. Given all the moving parts over recent months, I'd now like to walk you through the key building blocks for 2021. Our medium-term revenue outlook is underpinned by multiyear military contracts across the product portfolio. Together with a strong opening order book of $101.7 million and continuing strong demand from First Responder customers, this provides excellent revenue visibility for the new financial year. In 2021, as you can see on the slide, we expect revenues to benefit from our Military and First Responder respiratory business growing in line with our 3%-plus investor proposition, a full year contribution from Helmets & Armor, the ramp-up of the VTP and DLA body armor contracts in the second half following completion of first article testing and 11 months contribution from Team Wendy. We expect EBITDA margins to continue to improve as a Result of continued improvements in product mix, synergy delivery and operational leverage within Helmets & Armor and an inclusion of Team Wendy with its 30% EBITDA margin. CapEx, including capitalized development costs is expected to be around $25 million, with depreciation and amortization before the amortization of acquired intangibles of around $20 million. Cash conversion is expected to be in line with our 90%-plus medium-term guidance, and the adjusted tax rate is expected to normalize at around 21%. Finally, I would like to remind you that as previously announced, we'll be adopting the U.S. Dollar as our reporting currency for 2021. You will find U.S. dollar summaries of our 2020 results and 5-year track record in the appendices to this presentation. So before I hand back to Paul, I'd just like to finish with a summary of our outlook for 2021. We're confident in delivering our 2021 expectations. This is supported by Military revenue continuing to be underpinned by our long-term contracts, our opening order book of $101.7 million, strong ongoing demand from First Responders, full year of Helmets & Armor and completion of the Team Wendy acquisition in November. When all this is taken together, it sets us up for another great year in 2021. Thank you very much. And I'd now like to hand back to Paul.

And given the significant changes to the business this year, I'd like to spend some time to focus on the future, so you can better understand the medium-term opportunities for the group. Over the last 3 years, we've been successfully executing our strategy, growing the core by maximizing revenue from our current portfolio and improving our operational efficiency, pursuing selective product development to maintain and expand our leading product positions and targeting value-enhancing acquisitions to further accelerate growth and add value to the group. This has transformed the business with a strong product range of respiratory and ballistic protection products, which have established Avon Rubber as a leading provider of life-critical personal protection systems. I'd now like to talk to you about our Military outlook and how we should be thinking about the portfolio over the medium term. I will start with the respiratory protection products. When looking at the strength of the portfolio, the white bars show the expected life of the products with the customers, and the red bars show the period under contract. We have long-term contract frameworks with the DOD for the M50, M61, M69 and M53A1 products. These, along with the 5-year contract for the U.K. GSR mask and the 10-year agreement with NATO underpins the medium-term order expectations of $105 million to $150 million per annum. Now turning to look at the Military position for the ballistic protection product lines, we see similar framework contract agreements, but they're usually for shorter-duration life cycles. The IHPS helmets is the next-generation combat helmet for the U.S. Army and remains in low rate production. We expect This product line to generate orders of $40 million to $60 million each year with the recently announced $92 million contract, providing coverage through to 2023. The VTP product is our next-generation of body armor for the U.S. soldier protection system. And we supply 3 plates, the ESAPI, XSAPI and XSBI. We're currently going through the first article test process for these products. And once complete, we're guiding to annual orders of $25 million to $45 million. The legacy ESAPI body armor contract with the Defense Logistics agency is an 18-month base contract with 2 1-year options with a maximum ceiling value of $333 million. We've already received the first $20 million delivery order and expect deliveries to begin during 2021, which further underpins our medium-term outlook. And we're guiding for orders of $40 million to $60 million per year over the lifetime of the contract. When we also include the additional run and repeat orders from flat armor and Rest of World Military, we are anticipating annual Military orders of $115 million to $185 million for our Helmets & Armor product lines. Now turning to First Responder. On the back of strong H2 revenues related to COVID, the underlying business has grown by an impressive 23% during the period, and we expect to see ongoing high demand through this next wave. We continue to see a wider global opportunity for the First Responder products across both product lines and are continuing to build a wider customer base for the future. The NATO contract is a perfect example of our ability to maximize growth from our existing product portfolio and broaden our customer base. The 10-year framework contract provides NATO countries and partners access to our respiratory portfolio and includes masks powered air, supplied air, filters and accessories. The first 5 years, we'll see the fielding stage of these masks, which will then create an installed base, which will be maintained for the next 20 to 30 years, and we will see the sustaining phase of this program where masks are replaced along with the spare parts, filters and accessories that will provide an ongoing revenue stream. Our order expectations under this contract are included in the Rest of World Military guidance of $30 million to $45 million outlined on the earlier slide. This brings us to our continued investment in product development, which has continued to grow and maintains a full pipeline of multiyear R&D programs. For those that are new to Avon Rubber. We're a customer-centric business. In our minds this means looking at our customers, understanding their needs and identifying the technologies that do not yet exist to further enhance their capability and effectiveness and growing our business around our customers. We maintain our competitive advantage by continuing to develop the next generation of technology in partnership with our customers to meet their future operational needs. Over the last 10 years, we have on average spent over 5% of revenue on R&D investments, and we're committed to continuing this level over the medium term even as we continue to grow. Hopefully, you have been able to see the benefits of the Helmets & Armor acquisition throughout this presentation, but I just want to give you an insight to the work we've done so far. After completion Nick and I spent a lot of time in the U.S., getting to know the people, focusing on the key priorities and putting our transition plans in place. And we made considerable progress in the first 3 months of ownership. Integration remains firmly on track to complete this quarter with the transfer of the business onto our IT systems and operational frameworks. We remain confident of delivering the $5 million of synergies we initially targeted in 2021 as well as identifying further long-term efficiencies. Team Wendy was another significant acquisition and strengthens our portfolio as a leading provider of life-critical personal protection systems. The acquisition will create a global leader in Military and First Responder helmets, adding a high-quality and highly complementary business to the group. Team Wendy has a track record of profitable growth and delivers attractive financial returns that are above the group average. We completed the acquisition at the beginning of November, so we'll have 11 months impact in 2021, which underpins further growth and higher margins during 2021 at a group level. Team Wendy have had a strong start to the year under our ownership, but I'm really pleased with how things are progressing and the engagement of the team. We have transformed the outlook of the business in 2020. We believe our future performance is sustainable. It's highly visible, and has a wider range of medium and long-term opportunities across both Military and First Responder. Our products have high barriers to entry with significant advantages over our competition. We're committed to product development in partnership with our customers to develop the next generation of products and have maintained a full pipeline of R&D. We believe maintaining competitive advantage is critical to our strategy, along with further complementary M&A. And collectively, this will lead to further value creation for the future, which supports our confidence for 2021 and the group's medium-term outlook beyond. When considering all of this, I hope, like us, you're equally excited that the next 3 to 5 years will be very positive for the group and we look forward to the future. Ladies and gentlemen, that's it from us. I'd like to thank you for listening, and both Nick and I will now take questions. We'll take questions from the conference call first. And then for those that have submitted questions via the webcast, we'll read them out and answer them. We'll now take questions from the conference call. [Operator Instructions] Thank you.

[Operator Instructions] We will take our first question from Henry Carver of Peel Hunt.

Just one around kind of product development going forward. And obviously, with the M50, you did retain the IP on that or enough a bit so that you own enough of it to hold sway over that. With your new just sort of product development, is that the case with everything you're developing and also with the new products in conjunction with customers? Or just any sort of color around that would be very useful.

Yes. Thanks, Henry. I'll take that one, I think. What we've traditionally done is either ask the customer to fund brand-new technology that doesn't exist, like we did with the M50 when we did that platform and also happened, obviously, with the M69 Aircrew product. And then in recent times, we've been funding that R&D expenditure. So when we fund it, we completely own it. So M53A1 was ours, and that's driving that commercial revenue mix and hence, the margin. So I think we've gradually sort of been doing more of that over recent years. I think sort of with tomorrow's technology, if the -- particularly the U.S. government wanted to invest in that, we'd be delighted to do it. It's a great return on the investment when they pay for it. But what I would say is probably the majority of it is now becoming ours and we control it. And then if there is sort of a breakthrough technology that we've never done before, that's probably where we'd use the funded model.

Perfect. That's very useful. And also then slightly separately. On the First Responder market obviously, it's been very strong coming into -- well throughout the year and coming into next year. How do you see the shape of that over the next sort of couple of years? Is there a kind of inventory build happening at the moment because everyone realized that they didn't really have sufficient equipment in the wake of, amongst other things, the pandemic? Or is it just other factors going on there? How do you see it for sort of the next 18 months, couple of years?

Yes. I think -- so certainly, this year, with what's going on. We've sold more masks, but what we have seen is a much greater uptake in filters. So that says to me that people are actually using the products as well a lot more than they probably did in the past. And I think that we're seeing that in -- certainly into the first half of 2021 continuing. So I think that side is going to be consistent. The other side, as we go to the future, as this Pandemic in this morning's news in the U.K. is quite encouraging, I think it has to be assumed that over a period of time, there will be a vaccine. Vaccines will be rolled out. What I think you're starting to see with the dynamic now is that we've got a very strong respiratory law enforcement business. We're now starting to sort of launch the helmet range into that. So whilst the COVID sort of benefit will probably wear off over a period of time, you will see the sort of helmets come through. And I think there's a lot more opportunity in our First Responder to grow that business because at the moment, I've got quite an imbalanced business, very heavy towards the respiratory side. I'd like to see sort of more products coming into that product portfolio as well that we continue to grow for the future. So I think you will see over the sort of midterm, you'll see the helmet revenue stream starting to grow. And then equally, I'd also be looking at adding some further product adjacencies off that when we've got a very strong sales and distribution network going into that customer, being able to sell further products at the same time.

[Operator Instructions] Our next question will come from Annabel Hewson of Stifel.

I've just got 2, if I may. Just looking at that fairly big step-up on the filter spares and accessory side given the growing installed base of masks, what kind of percentage of the overall group could you see that reaching? And I know you've had a pretty busy year on the M&A front, but what is the climate like in terms of incoming calls to you and in terms of -- you've been very focused on North America. But would you -- are there any opportunities to go beyond that?

Thank you, Annabel. Nick, do you want me to take both? Or do you want to come in on one?

If you take them out first, I would say.

No problem. And if anyone could tell, Nick and I are actually separate rather than being able to look at each other at the moment. The -- so the first side, in terms of the accessories, I think probably 2 years ago or since 2017, I think that was down at sort of 15%, it grew to sort of 25%. We're continuing to see that profile evolve, Annabel. I think the army came on building in 2015. So what you are now seeing is that sort of huge slug of products that were installed with the army is coming through. I think also from the Military side, they did have sort of war stocks related to COVID. And they were moving and they were using those war stocks. So I actually think you're probably going to see quite a strong continuation on the accessories, particularly into '21 and probably '22 as those are sort of replenished that have been used over the last 18 months. So I think that's sort of one upside that we've seen. At the moment, in terms of first responders, we're not really seeing them carry much stock. We're sort of currently on a pretty healthy backlog in order pipeline within there. So we're probably sort of seeing 3 months visibility at the moment in terms of repeat orders, and they're still remaining quite strong. So I think that will sort of continue whilst we're in a COVID environment and probably will be the case until we've sort of got to the back end of a full vaccination rollout through all the different territories. So that would be my view. But then the third side is, I think we'll also see a greater masks platform with NATO coming on. You're going to see exactly that same business model that we've seen in the States starting to sort of build across those European customers. So we'll probably see quite heavy initial mass system purchases over the first 5 years and then sort of you'll start to see all of those spares and accessories building that sort of sustaining revenue stream thereafter. So I think there is sort of a nice complement in there. Just on M&A, I think it has been a busy year. At the moment, we are focusing on sort of how we extract value, which we've been doing with Helmets & Armor throughout the year. There's a bit of work we've got to do with Team Wendy, but it's a very different integration process. It's not as heavy as what we had to do with the 3M business. So I think that we're seeing this year as a sort of consolidation year, putting everything in place really getting the businesses where we want them sort of maximizing the margins and efficiencies out of them. And then we're probably ready to go again. Sort of next year would be the ideal time line. I think anything coming out in this environment it would have to be exceptional with very little integration work required simply because we're sort of busy with that and the new programs. I think I've always said I don't do it when I thought it was right and we had the bandwidth to do it. So the rest of sort of 2021 probably isn't the right bandwidth, but '22 certainly is and '23 probably as well.

Our next question will come from Andy Chambers of Edison.

I hope you can hear me okay?

Yes. Fine, Andrew.

Yes. Sorry, my microphone is a bit iffy. Just to ask 2 things really. One is just following on on first responders. Could you just give me some idea of how much of that is in the U.S.? And how much is international? I'm just interested to know whether you're starting to see pickup in international demand for the products? And secondly, just looking at the H1/H2 splits and taking into account what you've said in your order levels, I'm just -- you had an exceptionally strong U.S. Military performance in the second half of the year, and you had a quite weak Rest of the World's performance. I just wondered if you could give a little bit more detail around why Rest of the World didn't have a higher underlying base even with last year's export contract or the 2019 export contract. And whether there was anything exceptional in the run rate seen in the second half of the U.S. Military business?

I think just taking that point first, Andy, it's largely timing of some of the more sizable orders that we had. So we had a key order for rest of our contract that we supplied in Q2, and that sort of pushed our U.S. DOD sort of activity into the second half. So it can -- the splits can look a bit lumpy when you look at them on shorter time spans. But overall, the business developed as we expected it to. And as -- when you look at it as a year as a whole, nothing sort of exceptional or unusual within there. In terms of the first responders, around 70% of that business is in North America. And that's where we have seen the strongest growth in the second half. We do, though, have -- see a building pipeline in Rest of World. And so I think as we look into '21, we do see Rest of World becoming a bigger piece of first responder and having a bit more balance there than we had in the current year.

We have no further telephone questions at this time. I will now pass back to Paul for any web questions.

Brilliant. Thank you, operator. We've got 2 questions so far. So the first is from Andy Douglas, and it says, "I appreciate that it's early days, but can you give us some initial thoughts on how Avon Protection Team Wendy can work together to possibly drive revenue synergies? Is there anything interesting new that you found now and what you've looked under the hood?" I think we're obviously sort of a month in. We also had very good access to the management team between announcement and completion. So I'm actually really encouraged with that business. It's everything that we thought it would be. It's been a very well-run business for a long period of time. It's got a very stable sort of long-term management team. So it's been very smooth and very consistent. We've sort of been very clear about sort of how do we restructure their accounts in terms of our approach and architecture, which they've done. We've got them onto our reporting line. So we've done all of that. So it's been very clear. We've moved them onto our insurance. We've done all of that stuff. We've started to already work on the sort of programs and the opportunities. I do think there will be some sort of midterm opportunities for consolidating the supply chain. So Team Wendy will be sort of looking at providing more to Ceradyne, which we spoke to people about. So that will come through. I think revenue, there's been a really good response from the market. I think it sees it broadly positive. There's a lot of excitement with our customers. But we are currently running the brand separately from the sales structure. There's going to be a lot of discussions that are needed before we can ever sort of do that. So it's just being patient, finding the right time, but I'm really encouraged the business is delivering exactly as we thought it would do. It's got a very good sort of orders. It's continued to run through this period, similar to us, really. So from that side, I'm very pleased. Then there's a question from Anthony Plom as well from Berenberg. He said, "I hope you're both well. I had 3 questions, please. Adjusted EBITDA increased 6.8% organically year-on-year. Just to confirm, does this adjust for any benefit from IFRS 16? If not, what would the organic increase have been? Number two, closing order book up 19%, how much of that could have been delivered in FY '20, if you'd wanted to? And then the third question, basically trying to work out how much revenue was suppressed last year out of choice in favor of delivering the higher-margin First Responder market. Number three, on Military side, clearly, very U.S.-centric now, but can you remind us of the opportunities coming up in Europe?" There's quite a few in there. Nick, do you want to deal with the adjusted EBITDA increase to 6.8% organically and the impact of IFRS?

Yes, sure. So we've restated the 2019 numbers to state them on the IFRS 16 basis and make the adjustments to the base EBITDA number. And so the 6.8% is measured on a true like-for-like basis with each year having the adjustment to the IFRS 16 lease in it. Because we're now managing, tracking the business on this basis I don't, on the top of my head, know what it would have exactly what the increase would have been on the old GAAP basis, but it would be directionally similar because the base year, both years are consistently treated and doesn't distort the overall trajectory.

Perfect. So the second part is then the closing order book, up 19%, how much of that could have been delivered in FY '20, if you wanted to. I think I'll take that. If that's okay, Nick.

Sure.

It was a year. It is what we've delivered in the year. So that was our number. I think we did sort of probably find it more challenging in the second half, getting volume out of the door with all the disruption that's in the business. So I think it's probably fair to say, if this has been normal times, it may have been 1% or 2% higher. But it is what it is. We have had those sort of challenges that we've been dealing with. So that was the number that we delivered really. So -- and then the third side of sort of how much revenue was suppressed last year out of choice in favor of delivering the higher-margin First Responder market? None really. The products we were focusing on -- we did actually have an interesting mix split last year, where we suddenly started selling a lot more filters. So we were moving labor between the factory of masks versus filters. But that shows the flexibility that we've put within that business, particularly at the Cadillac side. And then on the Military side, clearly, very U.S.-centric, but can you remind us of the opportunities coming up in Europe? But there are a few. Obviously, NATO is a significant opportunity. So we're currently dealing with 4 customers. The NATO press release said that there's potentially 13 showed interest in joining that at the moment. So I think sort of making sure that we contact those customers and then build those frameworks and get them onto that framework agreement. There's also some sort of wider Rest of World opportunities as well that are out there. So I think over the next 5 years, you are going to see a much stronger performance of our European customer base, albeit we will still be growing in the U.S. as well with the wider product portfolio that we've got. So I'm still quite happy that there is a wider global opportunity. And I think that is one of the things for Avon. We've got an exceptional business in the U.S., but I would like to see a stronger global business, and that's going to be one of the things that we work on over the next sort of 5 to 10 years. So yes, I think -- I hope that covers your questions. That's all of the questions that we've got on the webcast. So thank you very much for everyone for dialing in this morning. We hope you enjoyed the results and the questions that we've gone through, and we look forward to seeing all of you soon. And hopefully, if this vaccine and rollout process sooner rather than later would be better for all of us. So thank you very much, and we hope to see you soon. Bye.