HelloFresh SE (HFG) Earnings Call Transcript & Summary

Dear ladies and gentlemen, welcome to the fiscal year 2019 results of HelloFresh SE. At our customer's request, this conference will be recorded. [Operator Instructions] I may now hand you over to Dominik Richter, CEO of HelloFresh, who will lead you through this conference. Please go ahead.

Good morning, everyone, and welcome to our full year 2019 earnings call. Today, we'll be covering in detail what we preannounced in January, a fantastic fourth quarter and the resulting full year 2019 numbers. We'll also be giving guidance on 2020 and a brief assessment of how the looming COVID-19 virus, according to everything we know so far, will have no big impediment to a great 2020 for HelloFresh. Let me start off first, though, with a quick reminder of our mission. We verbalized our mission very early on in the company's existence and remained true to it over the last 8 years. We've defined our mission as changing the way people eat forever. With more than 280 million meals delivered in 2019, whatever we do touches a massive number of people and lives every week. There's a number of dimensions where we fundamentally change how people eat. First of all, budget. With each meal that we're sending, we're helping consumers save real money. Our meals are priced very competitively at price parity to supermarkets in most markets and meaningfully below already in some as well as massively cheaper than take-out or restaurant visits. We do that by cutting out the middleman and all the food waste and make weeknight cooking really affordable. Secondly, health. Another dimension where we really make a big difference is around health. The most powerful way to lead a healthy life is through high-quality and unprocessed foods. We democratize access to high-quality food at low prices, no matter where you live and how far the next trusted food source is away. Thirdly, we really change the way people eat around taste. The quality of our meals is the #1 reason why consumers continue to order with us. Consumers tell us regularly that they find new cuisines and eat much more variety with HelloFresh. And finally, sustainability. We contribute to a better environment with every meal that we send. Not only do we cut out food waste almost entirely, we also have a lot less carbon emissions than traditional retailers and promote responsible sourcing standards. So really, with the scale at which we operate, our value proposition around budget, health, taste and sustainability has a tremendous positive impact on millions of households all around the world and really proud that we lived up to the lofty mission we created 8 years ago in 2019. With regards to this 2019, I'd like to share with you the macro-level highlights that make 2019 very successful for us. It was the first year where we celebrated group-wide adjusted EBITDA profitability. We've seen the underlying profitability in a number of our markets for a number of years now, but 2019 was really the first year where most of our mature markets operated at significant profitability, and hence, also as a group, we achieved the first full year of adjusted EBITDA profitability. We did that while growing revenue at 37% in constant currency. So really at the scale at which we operate to achieve that growth rate is something that the whole team is really proud of. I already covered that in the review of our mission, but delivering more than 280 million meals to nearly 3 million active customers really shows you what an impact we have in the lives of many million households around the world. What we're particularly excited about is that also in 2019, we invested in significant product improvements. So we, in a lot of markets, doubled the number of meals on the menu and really established meal kits as a mass-market product. If you compare our selection or meal choice that we have on the menu right now to only 2 or 3 years ago, then you'd see that we're now relevant for a lot more target groups than we were back then, so constantly evolving and enlarging the total addressable market that we serve. We also gained market share across both our segments, in the U.S. as well as in International, and I think in a lot of those countries are now synonymous with the whole category. Finally, we continued our efforts in reducing food waste and carbon emissions, making HelloFresh the most sustainable way to do weeknight cooking on an ongoing basis and really having a big impact on the environment. Now a lot of the things that we're going to talk you through now in the financial review for 2019 will actually not be completely new to you. It's actually quite in line with what we already told you for our Q3 and our Q2 results. But that's actually something that you should be eager to hear, because, in this instance, we're firmly continuing the trend from previous quarters of strong revenue growth, margin expansion, reduced customer acquisition cost and relative marketing expenses and also rapidly increasing adjusted EBITDA profitability. So first off, orders. Order growth in Q4 came in very strong, a 42% year-on-year increase. This helps also our full year 2019 results which came in at 37.5 million orders in all of 2019, a 38% increase year-on-year. Especially for our supply chains across markets, such growth in orders is a real challenge, and I'm very proud of what the team has achieved last year. Really thinking and realizing how much more product we're shipping through our supply chains in just 1 single year is something that requires a lot of hard work, and I'm really proud that the team did so well. Revenues grew almost in line with orders. Constant revenue growth for Q4 accelerated to 39% year-over-year, even higher than the full year revenue growth of 37% to over EUR 1.8 billion. Both of our segments contributed strongly to the overall growth with the U.S. segment, especially in the second half of the year with a very high-growth momentum. Our contribution margin remained flat in Q4, but is still up for the entire year 2019 by 1.3 points. Certain price investments helped us scale marketing spend very efficiently and with high ROI but partially offset by contribution margins remaining flat year-on-year in Q4. Like-for-like, we've seen the largest improvements to our cost base and procurement and through fixed cost utilization, given the much higher number of orders that we've seen compared to last year. Let's come to marketing. This was one of the biggest drivers of outperformance in 2019. In Q4, we saw very good year-on-year improvements, minus 6% year-on-year, slightly higher than what we anticipated. While we know pretty well the effect that higher brand recognition and a more mature customer base has on a percentage of revenues we need to spend on marketing, we also benefited from better pricing and marketing channel innovation. As our customer base matures, every week, more orders come from existing customers compared to new customers, and we need to spend relatively less on growing. That's an effect that we saw a lot in all our markets and something that with maturity, we expect to continue. This held true for all of 2019 and resulted in year-on-year improvements of about 3.4 percentage points compared to our 2018 marketing numbers. We expect that trend to continue now that our most mature markets are profitable, and benefit from that high brand awareness going on. With that, I want to hand it over to Christian, who is going to lead you to our profitability numbers as well as other financial metrics and the guidance for 2020.

Okay. So let me put together how these effects impacted our EBITDA in 2019. So when you look at the next slide, you see that our group EBITDA has been positive for both the full year of 2019 as well as in Q4. We achieved for the full year, a positive EBITDA of EUR 47 million or 2.6% in terms of margin. And in Q4 already, we achieved a very healthy margin of 7.5% for the group. Let's now drill one level deeper and look at our 2 operating segments. Both of our operating segments have been EBITDA positive in 2019. Our International segment already with a very strong full year margin of 10.6%, but also our U.S. business, for the first time, generated a positive EBITDA with a margin just shy of 1%. In Q4, our U.S. business already delivered a pretty healthy margin of 6.2%. I think this should give you a good sense on what the direction of travel is for our U.S. business. So if you fast forward to 2020, we would expect that our U.S. business will generate already an EBITDA margin somewhere in the mid-single digits. For International, for 2020, we want to maintain our margin at this very attractive level of around about 10%. And this is despite us, as you know, ramping up 2 new markets this year, Sweden, which we launched a couple of months ago, as well as France. So despite that, i.e., ramping 2 very early-stage businesses up International that we want to keep the margin at around about the 10%. With that, let's briefly recap what the core drivers of our margin expansion were on the next slide, on Slide 12. While in previous years, our margin expansion has been very much driven by savings on the COGS and on the fulfillment side, i.e., coming from contribution margin expansion. During 2019, still saw that. But the bigger driver of our margin expansion for the first time, were really savings on the marketing side. And Dominik has taken you through some of the underlying drivers, which resulted then in a margin expansion from marketing of 3.4% for the full year, and in Q4, even more so of close to 6%, 5.9% in Q4. Also on G&A, we start to show some positive leverage. If you leave one-off expenses out, we saw leverage of close to 1 percentage point. And then on D&A, with a bit more D&A primarily driven by IFRS 16 as most of you are aware of. And all of that basically has led to positive group EBITDA margin of 2.6% for 2019. So we're definitely proud that we delivered, or you could say even over-delivered, of the promise that we gave you a bit more than a year ago to generate in 2019 positive EBITDA. But we're equally proud on the progress that we made on our cash flows. So let's have a look at that on the next slide, on Slide 13. 2019 marked the first year where we also, on our cash flow from operations, generated a meaningfully positive number of EUR 42 million in that year, i.e., an improvement year-on-year of more than EUR 90 million. So cash flow from operating activities, which is after -- also after paying taxes, after paying interest, positive EUR 42 million in the year of 2019. With that, let's have a look also at our cash position. And at the beginning of 2019, Dominik and I relatively frequently still got the question, are you adequately funded, given all the growth initiatives that you're executing on with ramping up new brands, ramping up new geographies? Now more recently, we haven't got that question anymore. And the reason for that you see on the next slide, on Slide 15 -- sorry, on Slide 14. We started the year with a strong cash position of EUR 194 million, and we ended the year with a strong cash position of EUR 194 million, i.e., we largely self-financed this very strong growth that we delivered in 2019 on our own. Going forward, we will also provide you with an additional KPI, which is free cash flow. So let's quickly go through how we define free cash flow, that's cash flow from operating activities, minus CapEx, minus all IFRS 16-related payments, including any repayment of principal on the leases. So relatively conservative definition. In 2019, that number was relatively close to breakeven already, i.e., negative EUR 12 million. For 2020, we plan free cash flow to be positive already. And this is despite us planning to invest even more in CapEx in 2020 versus what we have invested in 2019. Because of the very strong growth that we delivered over the last couple of quarters and because of the very strong start that we had so far this year, we actually want to bring forward a couple of CapEx projects that we initially had earmarked for 2021. We will bring those forward into 2020. This means that in 2020, we will spend around about EUR 60 million to EUR 70 million on CapEx versus the just shy of EUR 40 million we spent in 2019. But despite the step-up in CapEx, we are planning for a mildly positive free cash flow in 2020. With that, let's go through our outlook for the year 2020 on Slide 15. Given the strong start of the year, we target constant currency revenue growth in the range of 22% to 27%. For Q1, you should expect us to be even somewhat above that range. And then in the second half of the year, we will be more within that range, primarily driven by the very strong comps that we've created for ourselves over the last couple of quarters. From EBITDA margin perspective, we're targeting a range of 4% to 5.5%, i.e., we target a continued nice expansion versus 2019. And from a segment perspective, as I alluded to earlier, for the International segment, we want to maintain our EBITDA margin broadly stable at a very healthy level of around about 10% that we delivered in 2019 already. And for our U.S. business, we want to further expand our EBITDA margin to already somewhere mid-single digit in 2020. Now for Q1 this year, and most of you know that Q1 is typically the period where we show the highest activity on the marketing side with corresponding costs on the marketing side. Despite that spending pattern on marketing, you should expect from us to be at least breakeven already on EBITDA in Q1. Okay. With that, we would open it up for Q&A.

[Operator Instructions] The first question is from Robert Berg of Berenberg.

Three questions, please. The first, going back to the marketing and kind of price incentives. You mentioned that maybe a little more price incentive, a little less marketing with obviously both positive effects on revenue and EBITDA looking forward into 2020. Interested to hear any comments on retention profile between the 2 side different strategies are, customers joining on this slightly lower entry prices showing any difference in retention profile to historic levels? And how we should think about those customers going forward? Secondly, on CapEx, the brought forward spend. Would love to hear a few more details on maybe what you're bringing forward? Is it capacity increases, automation, and any benefits that we might see from those? And the third question, interested to hear your thoughts on Blue Apron as a competitor after their recent announcement. Are you seeing any impact from their weaker performance? And would you have any interest in investing in that business?

Thanks, Robert. So maybe let me start off with your question around marketing and price incentives. So I think what we've alluded to in the past is that we're fairly agnostic, whether we invest in price incentives or whether we invest in media spend. What we've seen is that as we've expanded our selection of meals so much, making some of those meals even more affordable helps us both in lowering marketing spend as well as an increasing retention with our target customers. So while we trade in like a tiny little bit of contribution margin, we actually make back a lot more than that on lower customer acquisition cost and on an improved retention profile. Then the second question that I'm going to take is around Blue Apron. So I think you know that sort of like we're very comfortable with building up organically. We've done very few acquisitions in the past, and I think that's definitely a lot closer to kind of like what we feel really comfortable with. I think in each of the markets, especially also in the U.S., we've seen very high market share gains, which came from improvements into our product, much larger meal selection, et cetera. And I think that's going to be the prime focus for us also in 2020. So there are no imminent plans for us to engage.

And on your CapEx question, Rob. The projects that we are putting forward is primarily for capacity expansion. So we want to make sure we have and continue to have an adequate infrastructure in place, not just for the strong growth that we're experiencing now, but also for next year and the year after. So there are a couple of projects we're pulling forward. From a geographic perspective, we don't want to necessarily comment on which countries those concerns, also from a competitive perspective.

The next question is from Marcus Diebel of JPMorgan.

It's Marcus. Also three from my side. I mean first of all, congratulations on the margin. I think it's encouraging to see that TRE leverage is really coming through now. Again, more conceptually, how do you think about the business in terms of marketing initiatives from here and also on the gross margin? How much more is there still in -- yes, that you can get? Or would you say that the gross margin benefit that we've seen in the last couple of quarters has now played out, has been largely scaled in the U.S. But do you think that there is also an element of still improving gross margin further? Secondly, on the cohorts, the question, you previously commented that you keep about 24 -- 20% of revenues after 24 months. Yes, if I remember correctly. But the customer acquisition costs of in certain cohorts, and of the 20% that stay covers for the whole 100%. Sorry to be a bit more complex here. But is there any change in this cohort development or cohort metric? Or is that broadly stable? And then thirdly, Christian, you previously commented on pre-chopped meals, yes, and that they are really getting a lot of traction in Australia. I personally find it quite exciting given this is a, in my view, a new market. Is there something that you see in terms of latest developments? Has it improved further? Are you planning to move this also into other markets? So where are we on pre-chopped, and if you could just comment on the latest experiences there.

So with regard to contribution margin, I think also in 2019, we've definitely improved contribution margin in our cost base like for like. I think we alluded to that in one of the pages, mainly around procurement, around fixed cost utilization and also a couple of other sort of like smaller unit costs. We also saw a fairly good like-for-like improvement. I still think there is a number of opportunities of how we can get contribution margin higher. I think the nature of contribution margin expansion is that those projects always takes some time until they surface in the P&L. So a lot of the stuff that we've been working on over this last 6 to 9 months will actually like start having an impact now in 2020. Equally, a lot of the stuff that we're working on right now will have an impact on contribution margin, positive impact on contribution margin towards the end of the year. So we definitely see contribution margin go up in 2020 as well. But as you said, kind of like for us, it's always the decision kind of like if we improve something like-for-like. If you think back to our growth flywheel that we've also covered a couple of times, do we want to take that to the bottom line, or do we want to invest that into other projects that we have? And so I think for 2020, what you can expect that we improved contribution margin to over 29%. So definitely, like an uptick compared to 2019, and I'm still quite confident that over the next couple of years, we can get 1 point higher or 1.5 points higher year-over-year, just given the long line of projects that we have in the pipeline and that the team's already working on. With regards to the second question around cohorts. So we're, obviously, kind of like active in 12 different markets. Cohort profiles across those 12 different markets are actually fairly comparable, and it's also fairly comparable what we see right now to what we've seen last year, 2 years or 3 years ago. That's one of the major benefits that we have in our business model that allows us to actually forecast very accurately how much revenue we're going to make with a new cohort of customers that we bring in. And given that we generate so many data points, we can -- we have very high degree of predictability of how many -- how much revenue a given group of customers is contributing 3 months, 6 months, 9 months, 12 months down the line. So that's, I would say, a key feature of our business model that then allows us very good predictability and hopefully very good guidance.

And Marcus, on your last point, what we definitely see is that there is a high receptivity by a certain part of our customers across most markets to express type meals and recipes. And you may have seen that in a number of our markets, we, therefore, increased every week the number of these type of recipes that we are offering, and whether that's basically by having a better service pre-chopped in some markets or by the type of recipes that we are selecting or the number of pots that people need for cooking that, that may vary a little bit market by market. But it's an increased emphasis on this quick and easy express meals, that's something that you can see in our recipe selection already over the last couple of quarters and that's certainly going to continue.

Could you maybe -- just a follow-up question. Could you maybe tell us, maybe in your most successful market in this regard, what is the share in total orders? Is it like 20%, 30%, 40%? That will be quite helpful. Just want to see where the trend is going and with those kind of like quick pre-chopped meals?

Yes. But it's a relatively healthy share. We don't want to give, for competitive reasons, too much granularity, frankly.

The next question is from Olivia Rao (sic) [ Alvira Rao ] of Barclays. Just a sec. Sorry, sir, I think she hang up. So the next question is from Fabienne Caron of Kepler Cheuvreux.

Three questions from my side. The first one on the U.S. So you had a very strong growth in active customers in Q4, more than usual on rather low marketing expense. So I'm just wondering to which extent are you benefiting from customers leaving Blue Apron? Because your business, as you said, is very sophisticated. So is there a way for you to know how many customers you're gaining from them? And does it mean that the way to look at the U.S. going forward is actually with strong tailwinds. So you'll be in a position to continue to gain a lot of customers with rather low marketing expense? Would be my first question. The second question is more numbers. Regarding your holding fees for the full year, you had roughly EUR 51.4 million. What would be the figures for us to pencil in for 2020? Same as well in terms of numbers, you have some special items in the U.S. in Q4. If you could comment. And the last one on numbers, sorry. What trend do you expect in working capital for 2020, please?

So maybe on your first question around competitors and competitive dynamics, so I think last year, we've definitely seen a benign competitive environment. It's very hard to peck a number to customers that move from one brand to the other. I think what we are mostly focused on is just making sure that across all dimensions, we can have the leading offering in the marketplace. And so what we did over the last 2 years is really when it comes to order to delivery, when it comes to the speed of order to delivery, when it comes to the number of meals that we have on the menu, when it also comes to the diversity of meals that we have on the menu, the number of cuisines, the price affordability, et cetera, across all those dimensions, we've set the targets that there's no reason why we cannot be leading the entire market in all of those dimensions. And I think that's something that translates into very good active customer numbers in the U.S. So really, if you go back 2 or 3 years in the market and just given where we -- where our fulfillment infrastructure was, et cetera, the product offering was very comparable to some of our biggest competitors. I think as of today, across the most important dimensions, we're really a notch up and consumers realize that, and there's no reason not to choose HelloFresh but to choose another brand, and that's what we think has been the main driver behind the great customer growth in Q4 or in the second half of the year, especially in our U.S. segment.

Okay. And with respect to your other points, Fabienne, on holding fees. This is really, let's say, driven by our -- by the transfer pricing system that we have in place. How you should think about that, it's effectively a profit split arrangement that our individual subsidiaries have with us as the parent, that from the time when they turned permanently profitable that, effectively, the profit is split on a certain ratio between the subsidiary and the parent. So it's not directly linked to actual costs. So what you should expect, basically, over the next years is more and more of our geographies, basically, will have used up all the tax flows carryforward and now are moving towards the tone that this holding fee is continuing to go up. But from a group perspective, it's obviously left pocket, right pocket. In terms of special items, as you have seen and as we had in the press release, in January already, we increased certain legal provisions for early-stage litigations. There's no removement since then on that topic. On working capital, the dynamics of our business model stay unchanged. So as we continue to grow, you will continue to see a certain amount of cash inflow from working capital. For 2020, for modeling purposes, if you assume somewhere, let's call it, between EUR 10 million and EUR 15 million cash inflow from working capital, that's ballpark, probably the right assumption.

The next question is from Nizla Naizer of Deutsche Bank.

I have three questions from my end as well. Firstly, Dominik, you mentioned at the start that you'd maybe talk about the coronavirus impact of what -- how it could potentially impact the business and how you'll stand in a potential situation like that, some color on how you'll think about the ongoing situation would be great. Secondly, very strong growth again in the international market. Could you perhaps give us some color as to how fast the developed international markets were doing and what were the margins like there? Did you have any impact on -- from the bushfires in Australia? Some color on the quarter would be great. Lastly, could you reiterate the midterm margin guidance of 10%? I mean it has been for 2021 -- sometime in 2021 has been the previous commentary. At the rate the margins are doing, do you think we could see that even sooner, sometime in 2020? Some color there would be great.

Sure. So in terms of the coronavirus, I think looking at our supply chain as well as on our consumer exposure, we don't have any exposure to Asia. We have very little to no exposure to other, at the moment, high-risk areas. And so far, our cross-border supply chains are not really impacted. As a matter of fact, we have a very diversified pool of suppliers for all ingredient categories. So in no single category are we dependent on one single supplier. We always are very diversified in all those categories. And given the business model that we have, we always have the opportunity to either mitigate potential ingredient shortages, changing recipes or meals or switching out ingredients altogether. And so that's why we don't expect any adverse impact. If there are small- to medium-scale interruptions to our supply chain, we do believe we can mitigate those fairly well, and we've done a huge exercise in modeling out all the different ingredient categories and how we might potentially be subject to any interruptions. So as of now, and with everything that we know, given that there is no consumer exposure so far and given that our supply chain is well diversified as well as our pool of suppliers, we actually do hope and do believe that if the situation doesn't dramatically worsen, then we'll be very fine.

And Nizla, on your other 2 points, in terms of growth rates, international and for our developed markets, so for the whole of our International segment, we grew in Q4 around about 32%. And our more developed markets within that, which make up obviously the vast majority of that International segment, they've been growing very nicely as well. So each individual markets was at least in line with our internal plans. And yes, we see also in our developed markets a very healthy growth rate, both in 2019, and that's expressed by the Q4 growth rate of that segment as well as in the first 8 weeks of 2020 now. And with respect to Australia specifically, so despite those severe bushfires, our Australian team has operationally addressed that very well and traded well around it. So there were certain weeks, where, let's say, a couple of hundred deliveries could not be fulfilled, but that's a tiny portion of our total volume in Australia. Also sometimes, when roads were closed, we had to shift basically certain volume to Asia, for example. But despite that, it did not have a meaningful impact on the results of our Australian business. And that's what you see shining through in the overall international growth as well as margin profile. If you recall, International has delivered a margin of north of 14% in the fourth quarter already. That brings me to your last point. On midterm margins, so that is unchanged from our perspective. So we said we are targeting to get towards the 10% towards the end of 2021, and then want to operate around that level for the full year of 2022 and that is largely unchanged. We are well on track on that path but it's also not an automatism. So we have to continue to work hard and to work to realize that target.

The next question is from Andrew Gwynn of Exane.

Two questions. One, a big picture, one more detail. So just as in the big picture, I suppose you're quite unusual in the food delivery space in the sense that you're making money. Other food delivery companies are pretty content to, well, reinvest much more vigorously, and indeed, obviously, quite significant losses. Is there a temptation for you guys just to materially stamp on the accelerator? Or indeed actually now, at a stage where spending more money just wouldn't give a decent return? Clearly, the performance is an exception anyway. Just on the second question, typically, we've seen obviously quite a bit of seasonality quarter-to-quarter. Q1, in particular, typically quite a big investment period, how you put up a EBITDA loss. Is that what we should have in mind for our model? And perhaps just a little bit of a teaser on how January and February have gone clearly pretty strong given the Q4 number and also the full year guidance?

Thanks. So let me take the first question around conceptually sort of like how we get to our margins and also whether that makes sense to accelerate or not. I think the short answer is, we're in a very good position to balance growth and profitability, high growth and profitability. And I think inherent to that is the fact that how we get to our target margins, which is, in the end, we capture the whole profit pool that is out there. So when you think about a retailer, then there's also not only the retailer's profit pool, but there's the brand's profit pool, the manufacturer's profit pool, the wholesaler profit pool. And what we're able to do with our direct-to-consumer model and with the supply chain that we've set up is to actually capture that entire profit pool. And that's why compared to, let's say, retail business, we're just able to have much, much higher margins than if you're only selling third-party brands or a small portion of your own brands, because we basically control that supply chain end-to-end. So that's on the margin side, where we're able to actually generate significant EBITDA margins at scale because we're able to capture the entire profit pool. Balancing that growth -- balancing that profit with growth, I think you've seen over the last couple of years that we're not really holding back on growth. Maybe compared to some of the marketplace peers that you might be referring to, we're also shipping like physical products. So for us, a 37% growth rate year-over-year like we had last year, that's actually like a real challenge for the supply chain, because the way that we source foods, that we ship food, manufacture it, et cetera, that comes with a lot of complexity. And so for us, kind of like as we've basically referred to in our guidance, to be able to continue to grow our business by -- around a quarter year-over-year and expanding margins by being able to tap into much more of the profit pool and the food supply chain, that's what we think conceptually is the right strategy that allows us to expand our market-leading position and still deliver like very healthy profits.

And on the Q1 EBITDA margin question and overall how current trading has been so far. So you're absolutely right, Andrew. Q1 is typically the period where we spend, on a relative basis, most on marketing of all the 4 quarters, and that has an impact on our EBITDA margin in that quarter. However, having said that, you should expect us that we land at least around breakeven in that Q1 2020, i.e., you will see versus the same quarter last year in 2019, which was around negative 6%. You will see -- you should expect a very nice year-on-year margin expansion in Q1. And also from a top line perspective, obviously we're just 2/3 through that first quarter, so still relatively early. But I'm very happy how we've hit the ground running so far in the first quarter of 2020.

As there are no further questions, I hand back to the speakers for the conclusion.

Thanks a lot for attending the earnings call. We'll be back in May with the first quarter results that Christian just guided you to, and very excited to be covering them then. Thanks a lot. Have a great day. Bye-bye.

Ladies and gentlemen, thank you for your attendance. This call has been concluded. You may disconnect now.