Capital & Regional Plc (CAL) Earnings Call Transcript & Summary

Good morning. And welcome to our 2020 results presentation. Apologies, we are unable, due to COVID restrictions, to be hosting you in person this morning. We have guests both dialing in and on our webcast. A special welcome to our new Board member, Katie Wadey, who is on our webcast today, and of course, our Chairman, David Hunter. Stuart Wetherly, our Finance Director, will also be presenting today, and we will have time for a Q&A at the end. It's been a year of immense change, disruption and volatility on an unprecedented scale. We came into 2020 feeling confident post the growth point recapitalization in December '19. By March, we were feeling -- we're in a situation that very few could have foreseen. In my 30 years in this industry, I never thought we would be saying that collecting 60% or 70% of our rent was a good outcome. I am proud of the way our team have managed the challenges on a personal and professional level. These results are a testament to their hard work, agility, creativity and commitment. Thank you. This is a humanitarian crisis, first and foremost, than an economic one, and that has been our approach throughout. I would like to take the next 2 slides to explain the impact on the various areas of our business, what we are seeing, how we have responded and importantly, how we are looking forward. This is one of my go-to slides whenever I am asked to explain the impact of COVID on our business. It details our footfall in yellow against the national index in green, and importantly, our stores trading in the blue bars. Reading the mainstream media, one could be forgiven for thinking that all retailing will move online. However, as evidenced by the opening of the first Amazon Go store last week, physical retailing remains critical as a distribution platform. Further, and as we can see on this graph, each time restrictions were eased or lifted, our footfall and stores open rebounded very quickly. Anecdotal feedback from our retailers was that sales also rebounded very quickly. Despite social distancing, impacting store and center capacity levels, basket sizes went up. Many told us that they were surprised by the speed and strength of the response. This reinforces why we believe stores and, in particular, the essential and services retailers in our community centers are as relevant today as they were when we launched the strategy in 2017. We remain confident that we will see a similar pattern when the restrictions are lifted, hopefully in April. I'm keen to look at how we have responded to the COVID challenges. I will start by saying that all the hard work we have been doing since 2017 in repositioning our centers in accordance with the community center strategy, have, in our view, placed us in a stronger position to withstand the impacts on our trading environments. The strategy was established with the benefit of sound research and market knowledge and in full view of the long cycle structural changes impacting physical retail. I believe our occupancy at 92%, footfall stores open and the fact that all our centers remained open are reflective of the important role we play in the distribution of goods and services into the local communities we serve. Clearly, our retailers believe this as well. Not only did 95% reopen in the 72 hours following the easing of lockdown 2 restrictions, but we also completed 63 leasing transactions versus 66 in 2019 at positive spreads to ERV. We supported our retailer customers in several ways including delivering a 30% reduction in service charge in lockdown 1 and 10% for the full year, with a 13% reduction forecast for 2021. I will be going into our operational performance in more detail later in this presentation, following Stuart's presentation on our financial results for 2020. Thank you, and over to Stuart.

Thank you, Lawrence, and good morning, everybody. 2020 was clearly a challenging year. Our focus has been on operational resilience and maintaining optionality as we guide a path through the pandemic. Restrictions on trading on both ourselves and our retailer customers from March onwards and including the peak Christmas period, resulting in a significant reduction in income. This has flowed through to the bottom line, resulting in an adjusted profit of GBP 10.3 million for the year, down from GBP 27.4 million in 2019. COVID-19 has also impacted valuations both directly through the loss of income and also in accelerating existing structural changes. This is reflected in the fall in NAV to 150p per share and the increase in net debt to property value to 65%. In light of the current level of uncertainty and conscious of maximizing cash flexibility, we are not declaring a final dividend, we plan to maintain this position until market uncertainties resolve. The movement in property valuations has eliminated our distributable reserves. The REIT rules include provision that in such circumstances where a group cannot pay a dividend, the minimum PID requirement is treated as having been met no further distribution or tax payment is required. Net rental income at GBP 34.2 million has been impacted in primarily 3 ways. Significantly increased levels of bad debt, further CVAs and administrations and the loss of car park and noncontracted income. The first 2 I will cover on the subsequent slides. Car park and other noncontracted commercial income has been impacted by the lower activity incentives due to nonessential retailers having been required to close for significant parts of the year and social distancing restrictions being in place at other times. In total, this has reduced income by just under GBP 6 million year-on-year. Other impacts on NRI include the benefit of a net GBP 4 million surrender premium relating to a major unit at Luton, which is now being transformed into a new Lidl supermarket and a GBP 2 million reduction in NRI related to the impact of the new leasing standard. The latter is largely compensated by corresponding reduction in interest payable. Snozone had an encouraging start to the year, but was significantly disrupted from March onwards. Being required to close approximately 6 months of the rest of the year and operate on a reduced capacity other times. Operations remain closed, but we hope to be able to resume trading from the 17th of May. Net group costs are in line with the prior year at a level that is 1/3 or GBP 2.3 million lower than 2016. Rent collection for the 2020 financial year is currently 80% of the amounts originally billed. This breaks down as 95% for Q1, 75% for the last 3 quarters of the year. We made good progress in the latter part of the year, reaching amicable resolutions with a number of our retailers, providing, in some cases, modest concessions in return for settling the remainder of their outstanding balances in full. Throughout the pandemic, we've sought to firstly focus our support on those retailers requiring it most, typically our independent operators. The progress made reflects the significant effort from across the whole business, utilizing relationships at all levels from [ lower incentives ]. Rent collection for Q1, 2021 is currently running at 60%, and we've agreed deals would improve this by a further 10%. We're in active discussions with our retailer customers to resolve the outstanding balances, assisted now by the clear prospect of being able to resume trading next month. We've seen an acceleration in CVA administration activity, although it's still being primarily focused on the fashion and department store categories that we've been actively reducing our exposure to over the last 3 years. Of the 39 units impacted by CVAs or administrations in the year, 34 remain in occupation or are subsequently being re-let. The largest single impact in the year has been Debenhams, where we have 3 units that are at risk of being vacated in the short term. Annual empty rates and service charges circa GBP 2.1 million, that we've agreed terms on new occupiers to 2 of the units and have an offer on the third. COVID-19 has exacerbated industry-wide pressures on retail property valuations. Sentiment has again been the major driver with an almost complete absence of the functioning investment market and comparable transaction evidence. The trend of recent periods of London assets outperforming has continued again with the average decline of our 3 London assets over the year, 21.8% versus 36.2% on the rest of the portfolio. This reflects a stronger operational performance and strategic fit and particularly alternative use underpins, examples being the residential opportunity at Walthamstow and the plans for a new medical center and anchor tenant at Ilford. In these uncertain times, we've continued to prioritize the preservation of cash, viewing that until such uncertainty is resolved, it is too early to be making long-term decisions. We have maintained GBP 60 million of unrestricted central cash, equivalent to approximately 1 year's gross revenue. Maintaining significant levels of central cash enables us to ensure the stability of the group, providing resources to fund central overheads and to enable judicious investment in capital expenditure, while also providing contingency in the event of further trading disruptions. Our 4 asset-backed loan facilities are nonrecourse in ring-fenced SPV structures without any cross-default provisions. We've been working closely with our lenders to agree the most appropriate way forward on a facility-by-facility basis. On Luton and Hemel, we've obtained covenant waivers that are being reviewed quarter-by-quarter. While we remain absolutely committed to managing the assets and delivering the best long-term outcome for all stakeholders, with asset values below the level of the outstanding debt on these facilities, the economic rationale for committing central funds to cure these loans is, at the present time, challenging. On the mall facility, we've obtained a waiver of all financial covenants until the next interest payment date at the end of April. And we are in detailed discussions with the lenders about the longer-term extension of these waivers in return to the provision of additional funds and central cash. On Ilford, we've secured a waiver of the financial income covenants until the end of July. We have also agreed outlined terms on a longer-term modification of the facility covering at least the next 12 months to facilitate the completion of the planned medical center and the re-letting of the Debenhams' anchor unit, which if they proceed, the group will partially fund from central cash. In summary, while COVID-19 has and continues to have a pervasive impact on the business, we remain in a resilient position by virtue of the structure of the group and our loan facilities, our strong central cash reserves, the support of our key stakeholders, including the lenders of our long-term debt and our operational resilience. Together, this gives us a stable base for the short-term and provides a path for us to return to a more normalized trading environment. This, in turn, will enable us to better assess the retail landscape and the needs of the business and therefore, determine the best approach for addressing debt levels in the longer-term and shaping the group's future to capitalize on its strengths and expertise. Thank you. I will now hand back to Lawrence to give you more color on the wider business.

Thank you, Stuart. Reflecting on the financial results, I want to reiterate Stuart's comments on leverage. Clearly, this is not where we want to be. It is the product of the sentiment that exists around our subsector. We appreciate the continued support of our stakeholders as we navigate a path through this. We have learned once again that physical retail remains relevant for essential value and services-based retail. This is our strategy, and I believe in it. All community shopping centers are not the same. And these community centers form an essential part of community infrastructure, and therefore, have an important role to play in the ongoing evolution of retailing. COVID restrictions have accelerated the long-cycle structural changes in our sector. Our strategy continues to increase our relevance and our operational performance. Where we are most progressed in repositioning and remerchandising is where we see the best performance, and that has just been magnified during COVID. Our platform, our teams, our culture and our investments into our platform are delivering sector-leading results. We have continued to deliver on the key operational initiatives which gives us real confidence. Placing our teams and our communities at the center of everything we do remains essential to our success over the short, medium and longer term. Turning to merchandising. We have made good progress in remerchandising. As our customer proposition, this is of paramount importance, aligning our offer with the needs of our communities. In 2017, fashion represented 30% of our income. Today, it is 20%, and we have plans to reduce that number further. Our grocery and essential retail representation has increased through the 250-plus leasing transactions we have undertaken during this period. We are working with the sectors where there is demand for physical presence, and that is motivating us to work and think differently. Our low base rents at GBP 12 to GBP 15 per square foot, majority, high density and growing trade areas and the shift to local are all supporting our progress even in the current challenging environment. As we have said, merchandise mix matters, the majority of our centers are now or are in the process of being grocery anchored. We are working with retailers for whom the economics of online with its high cost base are most challenging. The fast-moving consumer goods and services businesses, where physical is a critical, and in some cases, the only distribution platform, where we provide the most relevant and proximate offer with high footfall and a deep understanding of the community and its needs, enabling us to target and tailor our offer to support success for our retailers. I'd like to turn now to our platform. Our platform is increasingly acknowledged as best-in-class. The investments we have made over the past 4 years include decentralizing our structure from central to local, providing autonomy to our teams who are unquestionably best placed to advise on the needs of their local communities and increasing our agility in responding. A rebalanced organization through continued investment in systems, streamlining our support functions whilst investing in income generation. These investments allow us to attract a wider pool of talent and experience, bringing new skills and backgrounds into our business. We have improved our data capture and analysis, creating better insight and faster action. And our culture has continued to develop and evolve. And there is always more to do. On retailer support, I am very proud of the way we have moved quickly to support our retailer customers. Firstly, to ensuring our environments are COVID-safe places to work and to visit, then helping our retailers achieve the highest standards, especially those smaller and independent retailers who may not have access to the support afforded from being part of a large chain of stores. Our existing partnerships with local authorities, local police and EHO and community groups, ensure a unified approach to guest and staff safety, reflecting the specific issues and communication needs that exist in each area. We move swiftly to review our service charge costs, resulting in a 32% reduction for the first 2 months of lockdown and a 13% or GBP 2 million reduction for 2021. The challenge continues to balance the need to support smaller and independent retailers, many of whom are totally reliant on the income derived from their stores to support their families, to enable this and to meet our own obligations and commitments that has been incumbent upon us to collect rent from those larger, well capitalized, profitable and in some cases, retailers who remain trading throughout the lockdowns. We haven't been able to provide every retailer with everything they have wanted. However, we have provided concessions to over 80 of our retailers totaling GBP 1.4 million. The focus and the effort by our leasing, property management, credit control and senior management team has been exceptional in assessing and processing the multitude of requests for support and ensuring that contractual obligations are met. Our focus is shifting to how we best support our retailers as we emerge from the restrictions. Consumer research and our own experience from previous lifting restrictions indicate a strong recovery or bounce back. So our energy is centering around how we facilitate a return to higher capacities in a COVID-safe way. Turning now to leasing. Leasing is the lifeblood of our business, driving our remerchandising in line with the community center strategy, increasing our relevance to the local communities that we serve. Our leasing momentum has been maintained with 63 new deals versus 66 in 2019 at a premium to ERV. Better still, our leasing pipeline is robust, with a further 57 deals in varying stages of completion, representing GBP 3.9 million in income, along with a further 23 lease renewals. Occupancy has been impacted by the restrictions and their on flow impact on physical retailers with total occupancy reducing by circa 500 basis points over the full year 2020. Debenhams will have a further impact, albeit we are encouraged by the progress in releasing the stores, which Stuart referenced. We have offers on 3, and we're very advanced on 2 of those 3. Leasing velocity will be key to restoring our occupancy to prepandemic levels. And over the following slides, we're keen to provide more color on how we will recover. We very much see the recovery from a leasing occupancy and income perspective linked to 3 key retailer groups. Firstly, independent and start-up retailers who are already a growing and successful feature of our business, especially in kiosks and smaller shops; secondly, the opportunity that exists in fitted-out stores, further lowering the barriers to entry for pop-up and existing retailers who are seeking to relocate into prime pitch, which we typically represent; thirdly, a continued rollout of the multiple and national retailers in the core community uses, including grocery, medical centers, including employment, gyms and pharmacy. Part of this is formerly out-of-town retailers who are seeking to relocate to smaller formats in urbanized areas such as London. We are convinced as the increased measures are put in place on car movement in urban areas that accessibility to out of town and big box stores will be impacted, driving demand back to highly connected town centers, especially in London. We are seeing real growth in our commercial income and pop-up store team, where we now have a team of 4 and it's growing. Many of these people don't have real estate backgrounds. As we said, back at our half year results, we foresee a growth in smaller and independent retailers, not dissimilar to the post-GFC recovery. And we have positioned ourselves for that. We are working hard to ensure these retailers have robust business plans and store presentations to aid their trading performance from day 1. Our focus on CML over the past 3 years is showing tangible results and pre-COVID, we're seeing growth in CML income across our portfolio with further income enhancement identified. Following the road map announcements, our CML team have been busy with inbound inquiries for stores and kiosk from potential operators. We have completed on a series of marquee leasing transactions this year, including Matalan and PureGym at Maidstone and a former BHS Department store and the job center at Walthamstow. Then in Luton, in the former M&S, we are on-site as these photos demonstrate with a new Lidl store opposite at existing and refitted Tesco. We've secured agreement with Lidl to establish a new format fresh food market, which will have a series of new and established local, independent retailers in shops and kiosks. And this format has application elsewhere in the portfolio. In addition, we are advancing discussions with Lidl in 2 centers to further increase our exposure to grocery and anchor our centers with higher repeat destination footfall that creates opportunities to remerchandise accretively around them. And in the service category, our planned NHS primary care medical center in Ilford is continuing through its final approval processes with discussions on foot for similar facilities in 2 other centers in our portfolio. There are ancillary uses that have already expressed interest in collocating near these facilities, providing further leasing momentum. In addition to the halo impact, increased footfall will create for existing and potential retailers. However, there is more to do and learn. We have over 7,000 car spaces in our portfolio. And the opportunity that exists around how we optimize their use has led us to a groundbreaking JV with U.S. company REEF, a first in the U.K. REEF will provide a range of new solutions to optimize existing car park performance through enhanced systems and technology to new uses, including dark kitchens, car park charging for bikes and cars, last-mile logistics and self-storage. Turning to mixed-use, intensification of our real estate, which remains at the core of responding to the needs of our communities for new homes, improved facilities, including hotels and offices, service uses and, of course, fitness and health care. Once again, we have made progress at Walthamstow with a minded to grant consent in January, a deal with PRS operator Long Harbour, bringing the plans for 495 apartments in 2 towers, one step closer to realization. The next steps are with the GLA and council. And we are anticipating an unconditional deal with Long Harbour later this year, triggering a GBP 20 million capital receipt and start on site. We remain committed to exploring the options that exist across our portfolio to increase density, especially in our urban London centers. We are conscious of the complexity, time lines and viability requirements that need careful consideration and management. And our experiences at Walthamstow place us in a strong position to assess and unlock other opportunities across the portfolio. Turning to Snozone. Nick and the Snozone team have enjoyed a lot during these lockdowns, and have responded brilliantly. Our thanks to the entire team. We remain confident in the leisure business and the Snozone team hence, the decision to proceed with a third full line facility in Madrid at the Xanadu shopping center. Snozone are considered market leaders in their field. And the opportunity to take over a well-established and profitable slope in a key European city on a capital-light basis was exactly what we've been targeting for the business, which has the capacity to grow, leveraging the existing team. We are actively pursuing other opportunities for Snozone in this sector and believe the business has the experience and capability to manage other leisure facilities outside the current ski slope focus. The health and well-being of our teams and all of those in the communities we serve remains of paramount importance. We are very proud of our ongoing support for our communities, which, once again, this year, where we supported over 80 charities and 78 community groups. We donated 750 hours in support and raised over GBP 130,000 in sponsorships and donations. Our work with senior council leadership intensified during the past year with active engagement and support on a range of issues from essential worker parking to partnerships on awareness campaigns around social distancing and the use of face masks. And we cannot forget about the contribution from an impact on our own teams. We focused hard on connectivity and mental health as we supported each other and has been especially pleasing to see our Star survey results, which placed us in the top quartile of companies, including a Net Promoter Score of plus 41. Our commitment to the environment also increased this past year as we undertook a full audit of our activities and initiatives, culminating an external materiality assessment and the appointment of new advisers and a renewed, broader, more integrated ESG strategy. We are committed to the better building partnership net 0 carbon framework to achieve net 0 by 2040. There is an implicit expectation from our local communities to ensure that we are a responsible corporate citizen, which makes ESG an essential element in our community strategy. We are looking forward to working with our stakeholders to deliver meaningful change during this year and beyond to meet, then exceed our stakeholders' expectations. ESG is a deeply embedded part of our culture, and we look forward to renewed vigor as we seek to achieve a further step change in our performance in this important area. In summary, we are very proud of what our team has achieved this past year in the most challenging and disruptive of circumstances. The sense of partnership in our leadership team and the acts of support and kindness across our business coupled with energy, passion and commitment to achieve our objectives is inspiring and humbling. Our community strategy, the work we've undertaken over the past 4 years and the investments in our leading platform have enabled us to deliver sector-leading operational results, which speak to the resilience of strategy in light of the acceleration in a long-cycle structural change in physical retailing that formed an integral part of our community center strategy in 2017. Lockdowns have shone a light on the importance of communities localism and our 15-minute neighborhoods. We are not immune from the wider impact of sentiment towards our sector and its impacts on valuation and in turn, our leverage. We believe more than ever, our role is to be prudent and cautious around the capital structure of the business, to be stewards of that capital until we have more clarity on a return to normal trading conditions and a recovery in liquidity in retail real estate markets. We fully appreciate the ongoing support of our stakeholders is key. And we appreciate and are encouraged by the support we have received to date. That concludes our presentation. Stuart and I will now be happy to take your questions. Thank you.

Thank you, sir. [Operator Instructions] Our first question comes from Matthew Saperia from Peel Hunt.

Plenty of evidence of the operating platform, working hard and productively in the presentation. Clearly, there's going to be a lot. Well, there already has been, and they will continue to go, I'm sure, plenty of changes of ownership in the U.K. shopping center market. At what point would you guys consider utilizing your platform to manage centers for third parties? And then as a second question, if I may. Looking at Luton and Hemel Hempstead, what are the options there that are presented to you guys given that the value of those assets are below the debt outstanding on them? And over what kind of time frame would you imagine or envisage conversations with the lenders ongoing?

Thank you, Matthew. It's good to hear you on a line. So there's 2 questions there. Perhaps I'll take the first one in relation to the platform and the potential that exists to effectively extend it further over third-party-owned real estate. I'll pick that up and then Stuart will answer the question in relation to Hemel and Luton, if that's okay. So just quickly in relation to management platform, very proud of what the team have done over the last 12 months in very trying circumstances. It's the same trying circumstances everyone's been operating under. But I think these results are very, very robust operationally, the things that we can control. We -- there has been some dialogue in relation to take on third party management. But I will say we're going to be careful about that. And there are a few reasons for it. Firstly, out and out, so the asset management is not super profitable. So we need to make sure that it's not a loss leader situation that we can make money out of it for our shareholders. But it doesn't compromise our focus on the core portfolio where our shareholder equity is invested. So focusing on the 97% rather than the 3% or 4%, if that makes sense. And lastly, part of that cost base is making sure that we're operating in geographies that we understand and we're represented in, not being a situation where we're having to incur high cost in terms of travel, time and monetary to attend to assets because they're increasingly operationally intensive, making sure we're not in a situation where it's just being efficient for the business to provide a level of support that we think these assets require. So hopefully, that answers the question. We're not ruling it out, but we're going to be cautious about it. I'm very conscious that we've got a great team with subscale, we could do with some more raw material, but it just needs to be on the right basis, if that makes sense. And I'll hand over to Stuart on the Luton and Hemel question.

Yes. Thank you, Matthew. I think it's fair to say there's a range of options on the 2 facilities, I think, but underpinning everything is getting back to a more normalized trading environment. Clearly, we all hope that, that starts next month with nonessential retail being able to open. And then with the further relaxations that are scheduled beyond that. But it's not really on a facility-by-facility basis. So we're working closely with the lenders on Hemel, you've probably seen in the detail of the results. We've agreed the sale of parts of the Hemel block that will help bring the loan balance down. On Luton, Lawrence mentioned in the presentation, we've got the new unit we're creating for Lidl. So all those things sort of factor into play. So I think getting first and foremost, a sort of stable operating environment back, hopefully over the next few months being positioned where we've got rent collection, returning to more normal levels. And I think then sort of taking it from there alongside those other asset-specific initiatives will enable us to continue to work closely and then set our longer-term plan from there.

Is there another question on the lines? No? We've had a few questions on the web but...

There are currently no further questions over the phone, but I would like to hand it back for any web questions.

Excellent.

We've had a few further -- I think some of this has been dealt with. We got a few further questions on the balance sheet coming through from Robbie at Numis and [ Mado ] at Absa about time lines, about the resolution of debt covenants and settlement of long-term solutions. And how likely use of the -- that you'll require a capital or raise to improve the LTV? And what would be the catalyst for a capital raise in your opinion. I don't know if there's anything further you want to add to that?

Yes. Certainly I'll start with this, and I'll hand over to Stuart, but I'm feeling this is a time for immense discipline, if we're frank. I think we need to see a path out of lockdown. As we sit today, 70% of our stores are closed effectively. And the government set out a road map to reopen those, hopefully, during April. We're conscious that may change. It might be later. Hopefully, it isn't. And the rest of that road map needs to be adhered to effectively for us to move from a position where we're collecting, let's say, 80% of our rent for 2020 or 70 -- in the low 70s percent of our rent for the 3 affected quarters, almost 60-odd percent with the line of sight to 70% for the December quarter. So we need some income certainty and some operating certainty in terms of the operating theater, before we start to look at next steps in terms of balance sheet. I think that's our position as we stand today. Let's get that clarity around what the near future looks like. Let's get some clarity around income, let's get back to collecting 97% of our -- 98% of our rents, and I think we'll be in a much stronger position to assess the capital needs of the business at that juncture. Stuart?

Yes. I echo that. And as I said, also some initiatives we're working on specific facilities. I mentioned Hemel and Luton, but also the Walthamstow residential transaction, that's bringing GBP 20 million sometime around Q3. So all these things will also help and throw into the mix from -- but as Lawrence says, I think the key, first and foremost, is it's getting that more normalized trading environment for us to plan from that.

And I'd have to stress, I don't even want to interpret it, but that's -- we're sitting here idly not doing anything. I think far from that. Hopefully, the presentation this morning reinforced that over the coming months, we're working as hard as we have been all of last year. And in the first 3 months of this year, doing the things that we think we're very good at, which is leasing space, improving occupancy and increasing our rent collection. If we can continue to do that, then that's obviously a huge step in the right direction in terms of dealing with the balance sheet at the appropriate time as well.

Okay. And just a couple more points on the balance sheet. One from -- which I'll read out together, one from [ Alan Carter ], are all your lenders equally supportive? And then [ Charles Bowles ] at Titanium, Good day Lawrence, Stuart. Cap Reg performed very well operationally and management -- operationally the management to be commended for this. However, it's overshadowed by finance and structured debt, which seems not to be being dealt with. Is this due to a reluctance of shareholders to support a capital raise? Surely, a capital raise is necessary for survival.

So I think Alan's question first, [ Alan Carter]. Our banks all equally supportive. Stuart and I are on the phone with them, pretty regularly aren't we, Stuart? I think I'd say that the they're all equally supportive. They see the world in slightly different ways. They have slightly different approaches. But I think across the piece, we've been very appreciative, and we are very appreciative of the support from our lenders. I think some of them are on the phone today, I'm sure. I think they appreciate our transparency, and they appreciate our strong operational performance.

Yes. And it's a relatively small number. It's 4 lenders that cover the 4 different facilities. So it's not a large number of different stakeholders we're dealing with on the lending side.