Ayvens (AYV) Earnings Call Transcript & Summary

Ladies and gentlemen, welcome to Ayvens Third Quarter 2024 Results Conference Call. Today's speakers will be Tim Albertsen, CEO; and Patrick Sommelet, Deputy CEO and CFO. I now hand over to Mr. Tim Albertsen. Please go ahead.

Thank you. Good morning, ladies and gentlemen, and welcome to this Ayvens Q3 and 9 Months 2024 Results Conference Call. I'm hosting this call with Patrick Sommelet. First, I will present the highlights of our Q3 2024. And then as always, Patrick will comment on our financial results, and then we'll take all the questions you may have afterwards. Let's go directly to Slide 5. Ayvens has continued to deliver steadily on its integration road map with robust business and financial performance in a continued contrasted environment. Starting with the financial performance, underlying margin stood at 521 basis points this quarter and 530 basis points over the last 9 months of this year. This level is in line with the Group's financial objectives and reflects the measures implemented over the last few quarters to restore profitability. Thanks to our continued focus on cost control, our cost/income ratio stood at 63.4% in Q3 2024, confirming the improving trend begun in the previous quarters. On the used car sales, Ayvens is reaping the benefits of our best-in-class combined remarketing channels that allow to leverage its most profitable markets to optimize resale volumes and prices, notably on electric vehicles. As a result, used car sales results per unit remained at a high level at EUR 1,420 per unit, a decrease of only EUR 60 compared to Q2 2024, this in an expected normalization of the used car market prices. Bottom line, our net income Group share came in at EUR 147 million as it was strongly impacted by the negative nonrecurring items this quarter. This Patrick will give you more details in a few minutes. Our capital position is strong with a CET1 ratio of 12.6% at the end of Q3 '24, up from 12.5% at the end of Q2 2024. Now turning to our integration journey. The Group has continued to move forward and reached major milestones this quarter. First, IT platforms have successfully been migrated in 5 countries since we obtained the D&O. These 5 countries represent 26% of our fleet. The IT migration notably concerned France mid-October, one of our 2 flagship entities, where employees now operate in a single IT environment in one building and under our new Ayvens brand. The new integrated IT systems enables harmonized business processes throughout the migrated entities concerned and will allow to start extracting cost synergies in the coming quarters. The ongoing integration of our legacy treasury center has made significant progress, together with a strong decrease in Ayvens derivatives portfolio, which will significantly reduce the volatility of our financial results going forward. In parallel, rebranding has continued to be rolled out, now covering 32 countries out of 42 in total. Also the Group's banking activity has been positioned under the new global mobility brand, Ayvens Bank, which is a key asset in supporting the Group's funding and development strategy. Overall, the Group recorded EUR 32 million of synergies this quarter versus EUR 27 million last quarter and EUR 20 million in Q1 2024. So with EUR 80 million of synergies year-to-date, we are on track to reach our objectives of EUR 120 million for the full year 2024. Last but not least, I'm happy to share that Ecovadis has awarded Ayvens the Platinum medal, which places our Group in the top 1% of companies assessed worldwide by Ecovadis over the last 12 months. This clearly illustrates our commitment to be better with every move as a leading global sustainable mobility player. Let's turn to Page 6 and look at our earning assets. Our earning assets increased by 5.8% year-on-year to EUR 53.1 billion. On a quarterly basis, earning assets remained broadly flat, resulting from our commercial selective approach over the last few quarters to maintain margins at a satisfactory level and onboard sound EV asset values. This has led us to consciously adjust the fleet downwards in some selected countries, notably in the U.K. and Turkey, where market dynamics are and will remain less attractive. As a result, the total fleet is down 1.6% versus September '23. EV penetration in terms of car deliveries stood again at 39% in Q3 2024, a similar level compared to last quarter. Battery electric vehicles penetration was 27% and plug-in hybrids penetration was 12%. Let me now hand over to Patrick, who will comment on our financial results.

Thank you, Tim, and good morning, ladies and gentlemen. In Q3 2024, Ayvens demonstrated the strength of its business model and market positioning in a softening economic environment and contrasted perspective in the auto sector. The gross operating income stood at EUR 724 million this quarter. The decrease compared to the previous quarter, which stood at EUR 785 million was mainly driven by significant nonrecurring items, which stood at minus EUR 47 million this quarter versus minus EUR 21 million in Q2 '24 and to some extent, to somewhat lower service margin in July 2024. If I compare versus Q3 last year, the decrease was fully explained by the minus EUR 127 million swing in nonrecurring items, which stood at the time at positive EUR 80 million. The Group's underlying financial performance remains solid with robust underlying margins, which stood at EUR 693 million, corresponding to 521 basis points of earning assets, the used car sales results, which is continuing on its gradual normalization trend at EUR 77 million in Q3 '24. This is down versus the EUR 91 million we recorded in Q2 '24, but up versus EUR 66 million in Q3 '23, whose accounting result was strongly hit by impact of previous reduction in depreciation costs and PPA. Let's now move to Page 9 to further comment on margins. Our leasing and service margin stood at EUR 647 million in Q3 '24 versus EUR 694 million in Q2 '24 and EUR 693 million on an underlying basis. Again, July 2024 was marked by lower service margin linked mostly to lower fleet rental revenues. August and September were back to satisfactory levels. When looking at margins over the first 9 months of 2024, they stood at 530 basis points of earning assets, which is in line with our financial and commercial strategy. If I now zoom into nonrecurring items this quarter, they were notably the result of the significant decrease in interest rates by 70 to 80 basis points since end of June. This has negatively hit the mark-to-market valuation of our derivatives portfolio for a total amount of minus EUR 54 million. As Tim said earlier, this interest rate swap portfolio has been significantly downside along with the review of our funding sources in foreign currency. As a result, the mark-to-market value of the derivatives as of 30th of September '24 now stands at EUR 14 million versus EUR 70 million 3 months ago with a sensitivity that has been brought down to EUR 2 million per 10 basis points of rate variation. Therefore, going forward, the volatility of this portfolio and that of Ayvens P&L will be drastically reduced. Finally, you will note that hyperinflation in Turkey had a positive EUR 10 million impact this quarter compared to negative EUR 37 million in Q2 '24 as car prices have been better correlated with the overall Turkish CPI. Let us now move to Page 10 to look at the car sales results. On Slide 10, you will have noticed that this slide has changed very little compared to last quarter, reflecting the very gradual decrease in used car sales price. As you can see on the graph on the left-hand side, the used car sales results per unit has continued to trend slightly down with a similar pattern as previously. Again, this quarter, the evolution by powertrain shows the UTS results on ICE still at high level and a negative impact on BEV, which are somewhat plateaued. This is also helped by the effectiveness of our remarketing channels, which allow us to leverage our most profitable markets and optimize both resale volumes and price, notably on BEV. Overall, excluding the impact of previous reduction in depreciation costs and PPA, underlying UCS profit was at EUR 1,420 per unit in Q3 '24 versus EUR 1,480 in Q2 '24, a limited decrease. On a reported basis, the result per unit is slightly down quarter-on-quarter at EUR 493 versus EUR 575 in Q2. We sold 157,000 cars this quarter, a stable number versus Q2, demonstrating our strong remarketing capability. I will now comment on operating expenses on the next page. In Q3 '24, operating expenses are down quarter-on-quarter by 3% with reduction both in CTA and underlying expenses. Starting with CTA, it stood at EUR 20 million this quarter as some of the spend will move into early 2025. This amount will most probably pick up in Q4 '24 as IT integration have now moved ahead. Full-year CTA spend should not reach the EUR 190 million we had planned initially and should land around EUR 120 million, EUR 130 million for the full year. Q3 '24 underlying operating expenses decreased by 3% compared to Q2 '24, reflecting our continued strong cost discipline, notably on IT costs. If we look at the first 9 months of '24, underlying costs have remained broadly stable on a like-for-like basis at plus 0.5% year-on-year despite inflation still running at sustained levels, illustrating our tight monitoring of costs. The underlying cost-income ratio in Q3 '24 stood at 63.4% and 64.3% for 9 months 2024. I will now comment on the rest of the income statement on the next page. Cost of risk was down to EUR 29 million versus EUR 31 million in Q2 '24 and after 33% in Q1. Expressed as a percentage of earning assets, the cost of risk stood at 22 basis points in Q3 and 23 basis points on 9 months at a mid-cycle level. The effective tax rate, which stood at 35.5% this quarter was negatively impacted by hyperinflation in Turkey and to a lesser extent by the Group restructuring executed in the context of Ayvens integration roadmap, which generates short-term tax return. Over the first 9 months of 2024, Ayvens effective tax rate stood just below 31%, in line with our expectations. Net income Group share stood at EUR 147 million this quarter, a quarter-on-quarter decrease, mostly due to the negative minus EUR 60 million pretax swing impact on the mark-to-market of derivatives versus Q2. You can see that excluding the negative mark-to-market of swaps net income would be at around EUR 190 million and RoTE at around 9.5% [indiscernible]. If we now move to the next slide to comment on the respected assets and capital, you can see that RWA increased this quarter by around EUR 500 million to reach EUR 58.3 billion versus EUR 57.8 billion at end June '24. This increase has been mostly driven by our cash position, which we deposit with Societe Generale, the amount of deposits increased by EUR 1.6 billion over the quarter and the portion we deposit over 3 months will generate a higher RWA charge has also increased. All in all, this cash position generated an increase in EUR 700 million of the RWA credit, partially offset by a decrease in RWA coming from the rest of our balance sheet, notably linked to decrease in flexible fees and balance sheet optimization. As a result of this evolution of our capital generation as well, CET1 stood at 12.6% at the end of Q3 versus 12.5% at the end of Q2. This is a strong level, standing at EUR 224 million basis points over the MDA. This concludes our presentation. Thank you for listening, and we are now ready to take any questions you may have.

[Operator Instructions] The first question is from Sharath Kumar of Deutsche Bank.

I have 2 questions. Firstly, can you highlight the reasons for the margin weakness? I know you had already flagged during the second quarter results that second quarter margin may not be sustainable, but Q3 level was a touch lower than your broad 530 to 550 basis points guidance. So maybe what were the reasons? And what do you kind of -- what is the way forward from here? So that would be my first question. And second, can you also speak about some of the risks, say, residual values, particularly in the BEV space, given recent weakness in that market?

Thank you, Sharath. Let me start with your second question first, and then I'll hand over to Patrick on the margins. So as you have seen, the used car market seems to be holding up quite well. I think we have spent significant resources to work on the residual values and also on our, let's say, capacity to channel the EVs in the right channels. First of all, more than 50% of our EV sales is actually done cross-border, meaning that they are sold in another country than where they were originated because it's quite a fragmented market and you see very different prices in different markets. So we have a strong capability to actually sell the cars to where we get the best price, and we are utilizing that. So it's true that we have seen quite a significant drop on the used car sales price of EVs over the last quarters. Having said that, in Q3, we have seen a stabilization and in some markets actually an improvement. So -- and for the months we have seen here, we see that as a continued trend at least for October as well. And then, of course, as you probably know, we explained last time, we have taken quite significant actions on residual values on all new BEVs that we put on the fleet. So we do believe we have the right positioning there today. And we have also on top of that, we are accelerating our capacity to do second live lease, third live lease for these cars and that's an ongoing activity that we're going to roll out. So I hope that answers the question on RVs and EVs. Patrick, on margin?

Yes. Thank you for your question. On the margin, actually, when we look at the detail of the quarter, and I don't like to give intra-quarter information, but it's always good to have a trend and to understand exactly the numbers. So the July margin, service margin was weaker and August and September were back to satisfactory levels and EV margin was in line with expectation. So there was some -- there is a weakness in part of the service margin, which I mentioned and which is a full fleet short-term rentals, which are lower. As the order book goes down, we see this activity going down as well because usually, it is an activity which is behaving well when our customers are waiting for their cars. Obviously, now that the order book is shortening, they are working less long, so they rent less -- they do less short-term rentals. Also, in July, in some countries, we have a bit of a seasonal impact related to the fact that some of our clients in France, in particular, would get their car ready for holidays, hence we have higher renting cost in July. So that's more -- that's not a general observation across countries but in some countries, it does happen. Again, that explains somewhat lower July, that's EUR 15 million only difference in service margin quarter to another altogether a limited magnitude.

And in terms of the outlook going forward. Do you -- are you confident of kind of increasing it to, say, the low end of the 530 basis points that you had guided earlier?

It's -- we have given indication that we see no reason today to contradict or to change.

The next question is from Kiri Vijayarajah of HSBC.

A couple of questions. So firstly, coming back to that core margin evolution. And look, thanks for the additional color. But your average contract duration is what, more or less 4 years now. And I'm really looking for a better explanation as to why kind of contract repricing effort seems to have played out in the space of just 3 to 4 quarters instead of that 3 to 4 years that you'd expect given how long your average contracts last? And then secondly, in terms of the kind of eventual pivot towards organic growth in the fleet, I know we talked a bit about it on the last earnings call, but there seems to be much less discussion of it today. So I'm just wondering, have you turned more cautious in the overall sort of volume growth outlook for the next few quarters? I know you'll probably give us new guidance for fleet growth in the fourth quarter earnings. But just in terms of the tone of the discussion, it just seems less discussion of sort of chasing -- using the benefits of being the lowest, most efficient producer in the industry and chasing volume growth. So I just wondered how we should interpret that.

Thanks, Kiri. I'll start with your second question as well and then I hand over to Patrick for the margin question. So I think we have spent significant amount and resources to really look deep into our business and the structural profitability of the different clients, partners, segments, countries. And I think that was a necessary exercise to actually start looking at where we want to grow because we want to start growing again, and we have actually put actions in place to get back to that. And the first signs are that we are stabilizing the order bank. So that's the good news. But we have also taken quite significant decisions as I stated in the introduction, we have a few countries where we consciously want to actually decrease our footprint for different regions. U.K. is one of them. And it's actually the bulk of, let's say, the reduction that we are seeing for the time being is coming from two, three countries. So -- and I think now we have a plan. We know exactly where we, first of all, have a good capacity to grow where there is segment that has some interesting perspectives and where we know the profitability is at the level that supports our, let's say, future objectives on margin and also what kind of clients obviously is in those segments. So there is a plan that was actually initiated a couple of months ago, and we are starting to see the first effects of that. And I can't give you any guidance where we want to be for next year, but we definitely want to start growing the fleet a bit again. And the margin?

Yes. On the margin, Kiri, -- the stabilization on the margin in '24 is mostly due to leasing margin in a context of stable, slightly and now more strongly decreasing interest rates. And the leasing margin in some countries can also be adapted to some customers depending on the level of interest rates, not all the countries, not all the customers, but in some. But I would say, generally, when rates are going down or stabilizing or going down, it's easier for a fixed lender to generate leasing margin as in any fixed rate business -- lending business. The service margin is still -- is coming back slower into satisfactory territory. On one side, there are the synergies which we are seeing in our service margin, which are going in nicely. On the other side, there is still the impact of auto parts inflation. It's true that now [indiscernible] inflation is coming down, but we can -- we know and we see that in some countries on auto parts, have in mind the Netherlands, for example, where you have auto parts inflation, which remains relatively high and a very tense labor market in our workshops for the repair of cars. So that's something that we look at very closely and that we expect to monitor on the increase in the months and years to come. Again, on the – under Q3, the VPs is really [indiscernible].

The next question is from Geoffroy Michalet of ODDO BHF.

First question is on the difference -- sequential difference between the earning assets that are stable and the funded fleet that is done minus 1.2%. So we understand there is kind of a change in the mood where you were more in a mode reignite the growth in Q2, and it seems a bit more risk off. Can you also comment a bit on the competition, notably because we saw Arval results saying that they were suffering from the used car sale results, whereas it's a bit the contrary for you. Maybe they are paying their too aggressive policy over the past 2 years, but maybe we can have your comment on that? Also wondering if the earning asset guidance is out of reach now for this year. And also on the margin, again, maybe if we could have some color on the impact of the new cars entering the fleet and that may erode the margins? Or if there is also an impact of the outgoing cars from the fleet on -- you touched a bit with some auto parts, but maybe there are other items that you would like to highlight.

Yes. Thank you, Geoffroy. Yes, so let me start with your first question, and I hand over to the Patrick. So I think what -- I mean, I think we have taken decisions in terms of our margin, but we also took some very clear decisions in Q1 basically to protect our balance sheet in terms of EVs. Competition has been quite slow to adapt, I would say, which, of course, have had an impact also on our capacity to write some of this business. Having said that, it looks like the market is getting better educated, especially around electric vehicles and that we are seeing a more homogeneous way of looking at residual values going forward, which should help us as well. But it's very clear that we don't want to grow for the sake of growth. That's not really wanted to grow fleet and net earning assets if the margins are at the right place. And again, we are in a structurally growing market. So we do still see segments and areas of the market, some countries where there is still plenty of opportunities, and that is pretty much what we're addressing. But clearly, we have been in a position for probably 6, maybe even 9 months where we have taken a decision that not necessarily was completely followed by the market, which have had an impact. But as I said, it looks like the market is getting better educated on EVs and residual values on these cars. So in terms, I cannot really comment on the used car sales on the Arval side. But what we are seeing is a stabilization at a high level for the time being, mainly driven by the fact there is a short supply of ICE cars in Europe because the new car sales has been down since 2020. And then, of course, the fact that people have, let's say, been a bit more slow to adapt to EVs is creating obviously a demand in the market that is healthy for our residual values on ICE cars in particular. But we do anticipate still that there is a normalization of used car market [indiscernible] but looks like it's good news that it is a bit slower than we anticipated. On the margins, Patrick?

Yes. Thank you, Geoffroy. So indeed, the front book now that the new production, if I may say, is better priced, especially in the service margin side because as you can imagine, for the past 3 years, we have had high inflation, again, even higher inflation on the auto components. And we are not protected in our contracts against higher inflation. So as the inflation has been volatile on the upside for the past 3 years, the back book, the stock -- in some countries, at least, the stock was severely hit in terms of service margin and RMT margin in particular. But now the new production, it's fair to say with inflation going down, the new production, the price has been adapted, and it's also part of the effort of repricing we have been conducting since the Q3 of '23. And in time, we will see the effect of this repriced service margin in our overall margin in our disclosure. That's actually taking place in most of the significant we are in, in Europe, where we can confirm that the service margin is today, especially on RMT price side, which is the one impacted by [indiscernible]. It is better price on the new production that on the stock. I don't know if this answers your question.

Yes. Maybe just one follow-up on that. Roughly for how long do you still see a drag for the back book in some countries where inflation on auto parts was strong?

The average contract maturity is [indiscernible] months. So that again year by year. It's going to go out progressively in the next 1, 2 years indeed.

But it's not more concentrated in some quarters or some semesters than others, you would say?

No, I think what we can say, Geoffroy is that this is mainly related to the Western part of our European markets. In the Eastern part of our European markets, typically, we have had an inflation price because there has been inflation in these markets for 15, 20 years. In the Western part of Europe, we have not seen inflation of any significance probably, and hence, it's related to that part of the book, which has, of course, the majority of our business.

And maybe a last one. Could you help us maybe quantify, let's say, the positive effect of the front book and the negative effect of the back book roughly speaking?

It's very difficult to say because it depends very much in each country. And the countries are priced very differently and have a local dynamic. So it's something which is a bit difficult to comment on a general basis.

The next question is from Julien Onillon of Stifel.

I have 3 questions. The first, could you comment or to have a view about the possibility of a penalty made by the French government on this discussion currently on the budget to corporate their fleet will not go quickly enough towards EVs because there is some talk that they may put some tax or penalties, specifically to corporates, which are not moving to EVs fast enough. Have you an idea about what could be the impact for you? That's one question, and it's quite too early to think about that. Second question will be again a bit about the tax. The French government has decided that all company making more EUR 1 billion of revenue in France will have to pay extra generous tax. Have you made a measure what could be the impact for you in Q4? Because I guess you make more than EUR 1 billion of revenue in France. What could be in euro the impact in Q4, if there is any impact on the tax income? And finally, a final question last year, your used car sales jumped dramatically. You sold a lot of cars in Q4 last year. I mean you mentioned that the used car market is stabilizing much better than you were anticipating right now. Are you planning to do the same phenomenon? Or should we expect the same phenomenon, a big jump in the number of used cars sold in Q4 like we have seen last year? Or it should be more stable because you don't have so much inventory to sell?

Thanks, Julien. So let me take your first and your third question first, and then I hand over to Patrick. So I think, first of all, the discussions around mandating either companies or companies like us to have a certain percentage of EVs in our new sales. We are clearly against. We don't think that that's the right way to do it. That's a position we have taken in France, and that's also a position we have taken European-wide. We are in close discussions with the European Commission on these subjects. And we were also part of the discussions that took place, I think, 4 or 5 months ago in France on the same subject. So it's difficult to see how it pans out. I mean we are not against electrification at all. We think that that's the right direction to go, but it needs to be under the right conditions. And that is actually what we are pushing for. We are working through our European association, Lis Europe, where I'm a Board member myself, and we are in close contact with the decision-makers on these things, where obviously, if the whole ecosystem works well together, that means the manufacturers, companies like ours, charging facilities and the whole ecosystem obviously is facilitating the transformation in the right way. We would not necessarily be against accelerating the electrification, but it's clear that it cannot be just put on one player or one part of the market. It has to be --and I think what, let's say, the discussion we have seems to reasoning, I would say, at least at European level today. On the used cars, I think what happened in '23 -- end of '23 was a bit of a coincidence because somehow all players, including also some of the manufacturers, the captives of the manufacturers and some of the bigger players like Arval's. We sold a big number of cars, as you mentioned, in the last quarter of '23 to actually de-fleet a bit up to the year-end. And obviously, somehow everybody did the same, and that actually had a really, really negative effect on the market prices at that point. We have our stocks fully under control, to be honest, we are selling around 150,000, 160,000 cars per quarter, and that's also what we expect to sell in Q4, perhaps a bit less. But our stocks today are where we want them to be to a very large extent, and we do not anticipate to accelerate sales for that matter. Maybe on the tax.

On the tax, yes, it's difficult to comment on something which is not stabilized yet. But what we can expect as we see the project today is a limited impact on us for a number of reasons. One of them being that we have our holding in France and the holding is bearing a lot of cost [indiscernible], taxable income, but also some specific features of the business, which makes it that the taxable income is lower than actual income overall. But again, we will wait the final tax overall. We don't expect a major impact in '25 [indiscernible].

Okay. May I come back a bit on the penalty potentially. Again, it's a discussion in France right now. But my question was also if there is a, let's say, a penalty if the corporate is not moving fast enough towards, let's say, EVs, it could be, the question would be, would it impact your customer, which will have to pay the penalty or you as a sort of supplier of fleet? That's a bit of the question now fleet belongs to you, but it's for one customer in direction. So what do you think it could happen if something happened like that? And if there was a penalty would be impacting your customer and directly, you will invoice a higher price it's impacting you. How do you see the eventual negativity of such an event?

Yes. I think, again, also coming back to the tax question, there's a lot of speculation on this. I think initially, the proposal was to actually put the mandates on the leasing companies, rental companies. Now I think the one that is on the table now is actually that it's the corporate client who will have the penalty, which means that, obviously, our customers will ask for having more electric vehicles than they have today. Now actually on the new order in France, the intake of EVs is pretty much at par with most of the other European countries. So I mean, that's -- in the case where there would be a mandate put on leasing companies, it would then be up to us to obviously consider that what kind of residual values is right in that scenario and judge the risk. So it's a bit difficult, Julien, to really give you a very clear answer on that because, again, there are several different discussions ongoing. Again, if there is mandates that will eventually mandate us to be at a certain level of electrification by 2032, 2033, I don't think there will be necessarily any negative impact. But if they would start implementing mandates coming from '26, '27, it could be questionable whether that is the natural rhythm of electrification and that could have some impact. But I mean, at this point, the market is adjusting themselves to a very large extent. And of course, we are an important player and we play a role in the way we look at this market. We will continue to look at our balance sheet and ensure that we don't take too much risk on that.

The next question is from Matthew Clark of Mediobanca.

So just coming back to the interest rate environment. I mean interest rates are falling or look to be falling much faster than would have perhaps been expected when you formulated your margin guidance. So how does that affect your 530 to 550 basis point margin guidance? Should we be looking more to the upper end of that or above that as a result of the lower interest rates? That's my question, please.

Matthew, no, we don't really change our outcome for the year.

And why is that? Is it that simply the benefit from lower interest rates is not material enough? Or is it offsetting negatives?

No. But first of all, as a stock business, we have made some borrowings mostly in the first part of the year. So we are not benefiting fully in '24 for the lower interest rate. Second, as we said in the Q2, in some countries, and we are being very selective, as you know, we want to raise. So we need to be somewhat more aggressive than at the beginning of the year. So we are passing some of this interest decrease to our customers. You see that we have now -- we are now slightly defeating -- that defeat is mostly correlated to 1 or 2 countries in which we want to limit our position due to either risk or limited profitability. But the fact is that on a more general basis, we need to accompany this decrease to our customers if you want to restart growth. So that's the 2 main reasons that I can cite that I can give you [indiscernible].

[Operator Instructions] Mr. Albertsen, there are no more questions registered at this time. I'll turn the call back to you.

Thank you very much. Well, thank you for listening, and thank you for the questions. And don't hesitate to reach out to our Investor Relations teams if you might have further questions. Thank you for your time, and have a good day. Goodbye. Thank you.

Ladies and gentlemen, this concludes today Ayvens conference call. Thank you for your participation.