Khadim India Limited (KHADIM) Earnings Call Transcript & Summary

Ladies and gentlemen, good day, and welcome to the Q4 and FY '25 Earnings Conference Call of Khadim India Limited, hosted by MUFG Investor Relations. [Operator Instructions] I now hand the conference over to Ms. Masoom Rateria from MUFG. Thank you, and over to you.

Thank you very much. Good evening, everyone, and welcome to Q4 FY '25 earnings call of Khadim India Limited. Today, to discuss the results, we have with us from the Management, Mr. Rittick Roy Burman, the Whole Time Director; Mr. Indrajit Chaudhuri, the Group CFO. They will take you through the Results and Business Performance, after which we can begin the Q&A session. Before we begin the conference, I would like to mention that this conference contains certain forward-looking statements about the company, which are based on the beliefs, opinions and expectations of the Company as on date of this call. The actual results may differ materially. These statements are not guaranteeing the future performance of the company and involve risks and uncertainties that are difficult to predict. I now hand over the conference to Mr. Rittick, sir. Over to you, sir.

Hello. Good evening. I hope I'm audible. On behalf of Khadim India Limited, I'm pleased to welcome you all to today's conference call, where we will be discussing our Q4 and FY '25 results. We sincerely appreciate your time and interest in our company's performance, and we hope you have had the opportunity to review the financial results and investor presentation available on the stock exchange. The global macroeconomic environment during the quarter remained challenging with shifts in consumer spending behavior leading to a muted demand. Despite these headwinds, we maintained steady revenue growth with Q4 revenue at INR 149 crores, which is up 3.8% year-on-year. Gross margin improved by 68 basis points, driven by volume growth and better cost control. One of the key milestones during the quarter was the successful completion of our demerger process. The scheme of arrangement for transfer of distribution business of Khadim India Limited into KSR Footwear Limited has been approved by the Honorable National Company Law Tribunal Kolkata Bench. While this order dated 27th March 2025, the said scheme has been effective from 1st May 2025. And in terms of the said scheme, all the assets and liabilities as demarcated pertaining to the distribution business of Khadim stands vested with KSR Footwear with effect from the appointed date, which is 1st April 2025. KSR Footwear will be listed shortly, and we believe this strategic move will enable sharper focus and better performance across both the retail and distribution segments. We are targeting breakeven in the distribution segment by FY '26 with a renewed focus on cost reduction and sales growth. The retail business will continue to drive performance with a 2-pronged approach, maintaining value-focused pricing under the Khadim brand and premiumizing our sub-brands through price enhancement. Looking ahead, we are excited about the launch of our new athleisure segment in the upcoming spring/summer season. This price-sensitive range, combined with our higher-margin products, is expected to contribute positively to our gross margin in the coming quarters. As a part of our cost efficiency measures, we have also shifted some e-commerce warehouse operations to Ekart Logistics, allowing us to benefit from their scale and expertise while converting fixed overheads to variable cost. As of FY '25, our retail store network stands at 886 stores with 14 new stores already added during the year. This includes 213 company-owned outlets and 673 franchise stores, reflecting our continued commitment to an asset-light expansion strategy. Looking ahead, we are optimistic for FY '26, expecting volume growth driven by reduced MRPs and new product introductions. Now moving on to our financial performance, quarter 4 FY '25. For the quarter, we reported revenue from operations of INR 149.1 crores, reflecting a 3.8% year-on-year growth. Our gross margin for the quarter stood at 46.9%, up by 62 basis points as compared to the same period last year. EBITDA for the quarter stood at INR 15.18 crores. EBITDA margins for the quarter stood at 10.2%. Profit after tax Q4 FY '25 was INR 0.92 crores, showing a 10.1% decline year-on-year with margins at 0.6%. For the year-ended FY '25, revenue stood at INR 623.7 crores with a slight increase of 1.4% and gross profit margin stood at 46.7%, which has improved by 130 basis points through our consistent efforts in premiumization. EBITDA for the year stood at INR 66.6 crores with an EBITDA margin of 10.7%. Profit after tax for the year stood at INR 5.06 crores and PAT margin stood at 0.8%. Looking ahead, we remain confident in our strategy and proactive approach. We are committed to building on our strong brand, expanding our retail footprint and innovating to meet evolving consumer demands. We believe that these efforts will yield positive outcomes in the coming quarters, and we are excited about the opportunities ahead. With that, I conclude my update, and I'm happy to open the floor for any questions. Thank you.

[Operator Instructions] We'll take the first question from the line of Arnav Sakhuja from AMBIT Capital.

So I want to know in the retail segment, how many stores are we planning to open in FY '26?

In retail, we are planning to open around 50 stores combining of COCO and franchisee in FY '26.

And what would be the mix of COCO and franchisee amongst these 50 stores?

Around 7 to 8 COCO and balance franchisee.

And is there any [indiscernible] profitability guidance you can give us for our retail segment in FY '26?

Retail means as we have told that we have reduced the MRP in our Khadim brand. So there will be some margin reduction in that. So for that, maybe in the first quarter and in the second quarter, there will be some gross margin reduction. However, we think that will be combatted with the value growth. Already, we have seen this year, there is -- in FY '25, the value growth -- value degrowth has stopped. We are static at -- I mean whatever we have -- the volume we have sold in FY '24, we have sold the same volume in FY '25 also. In the last 3 years, there was continuous volume degrowth. So I think we would be able to increase the volume. That will increase the value sales. However, the margin will be slightly in the lower side.

And just one more question. So as you spoke about -- as you mentioned in your opening comments and as we discussed in the last quarter call as well, you've been piloting an athleisure segment, this new segment. So would the margins be better for this segment? What would be the margins in the athleisure segment?

Athleisure margin will be more or less same as of footwear. We have kept value-based product, so that the more volume uptake is there because in the athleisure segment, there's a lot of competition. If we keep a higher-margin product, I think that will not be able to sell from our store. So we have kept at the same level of margin what we generally get in our Khadim product. So more or less, the margin will remain the same, but it will increase the value sales for our store with no cost because already we are incurring fixed costs in the store.

Next question is from the line of Bhargav from AMBIT Asset Management.

Sir, my first question is that is there any time line on the listing of KSR Footwear?

We are already in that time line zone, but what has happened is that in the NCLT order, there is a transfer of authorized capital from Khadim India to KSR, which is pending in the MCA. So once that thing is done, which will be done within this week, we will be announcing the record date and the listing process will also start.

At best in a month's time, it should get listed, right?

Yes. Yes. We are already in it.

Second, what is the debt reduction plan in the retail business? Because I believe there will be close to about INR 100-odd crores of debt on the retail business.

Yes. We have a plan of reducing the debt, but that depends on the cash flow and also the profitability of the business and some extraordinary income. So whatever cash is generated in excess of what is required will be used for reducing the debt. In the last 2, 3 years, we have already reduced the debt from INR 125 crores to INR 100 crores, and we will be again in the process of reducing the debt.

Because if I look at your FY '25 operating cash flow in the retail business, it's closer to INR 44-odd crores, right?

Yes.

So then we are generating good cash flows to sort of -- so is it fair to say that in 2 years' time, we should be debt-free in the retail business?

That will be an aggressive statement, but we'll definitely try. Another thing is that we have creditors also. We also reduced the creditors' debt so that the working capital cycle is also improved. So taking both the thing together will -- definitely, if the cash flow comes in, we will reduce the debt because our debt is mainly working capital debt, It's a straight type of thing. So whatever excess cash you park in the cash credit account, your interest is saved.

Okay. And as both companies become separate, do you envisage any increase in fixed cost because there will be some duplication or you don't?

Yes. In some cases, like the audit fees and all these things, there will be, but the 2 -- we are maintaining the 2 departments. So the costs are totally different. And maybe some common expenses like the NSE/BSE fees and all these that we'll be having -- incurring in both the companies. I mean that is very, not a very big amount, but that there will be some duplication.

And lastly, I mean, on the distribution side, we have a factory in place, whereas in retail, we do most of outsourcing. But now with the demerger, is there any change in plan or we continue with our in-house manufacturing on the distribution?

In-house manufacturing will be catering to the distribution, but some product which we used to take from our manufacturing division, Khadim India will purchase it from KSR Footwear Limited.

[Operator Instructions] Next question is from the line of Divyesh Dagliya from Neo Wealth and Asset Management.

I had a couple of questions. Number one, I wanted to firstly ask with respect to the balance sheet split that we're going to see between both the businesses of KSR and Khadim India. How much is going to be split to the distribution business and what proportion will stay in the company itself?

The assets that are eligible for -- that are used for the distribution business will be -- has been transferred to KSR Footwear Limited, like the factory -- machinery molds, the factory buildings, the warehouse that caters to the distribution business, all the movable assets of this division has been transferred to this KSR. And the retail assets have been kept in the Khadim India Limited. We have already -- the asset detail has been given in our SEBI results, which assets has been -- in the demerged entity, means in the discontinued operation has already been given. If you want a detail, we can provide that.

Yes, please, that would be helpful. And I just wanted to understand the loans and the borrowings we have in our books, that is not against any of these factories or it's not pledged against any of the fixed assets, right? It's against [indiscernible] guarantees.

Loans are generally of cash credit nature. So some portion of the cash credit has been given to the KSR Footwear and INR 100 crores of loans are kept in Khadim India Limited.

So I believe the split is INR 120 crores. So that's INR 100 crores with Khadim and INR 20 crores with KSR.

Yes.

Next question is from the line of Anupam Jain from Indira Securities.

What is the update regards Punjab [indiscernible]?

It is pending before the high court. Already, we have got a date, and I think that has been done on 19th of this month. And the next date would be in the month of July. We are in -- one of the bidders has already got the payment, and we think that we'll definitely get it within this financial year.

Okay. My primary question is also that why are we taking this court -- taking this case in court?

Because we have got the arbitration order in our favor for that -- against the arbitration, the government has moved to the court.

Okay. And the UP government that you have received till now [indiscernible]

All the payments from UP government has been received.

Punjab government is still pending, INR 25 crores, INR 26 crores that was pending.

Around INR 32 crores.

[Operator Instructions] The next question is from the line of [ Raj Patel from RK Securities ].

Just 2 quick questions from my side. So can you please elaborate on what specific changes have you been observing in customer behavior and spending patterns? And how are you evolving the consumer preference influencing the product development, pricing and marketing strategy? Apart from that, is there any notable shift towards online or omnichannel purchasing? And how is the company adapting to this trend?

So regarding the consumer preferences, what I can say is that while there is a bit -- there was -- over the past many months, there was a little bit of inflationary pressure, because of that, we have taken the call of reducing prices in some of our -- in our mother brand Khadim. So because of that, as the CFO mentioned a while back, last year, we were able to arrest the volume degrowth. We had to give discounts and all these things. So pricing-wise, that is one consumer trend is there that they are looking for some sort of value. But having said that, it's not that they are looking in all products for value. There is also a segment of consumers in our country that are looking for value-added products. One is total value and other is value-added products. So there also, we have done a lot of work in our sub-brands. We are changing a lot of elements in our products. We are changing historically whatever soles you were using, we are trying to use better soles, better materials, we are trying to give better comfort into our products. We are trying to make our products less serious looking because of the casual need of the consumer, the consumer wants to wear casual stuff, okay? So all of that work is also going on. A lot of work has gone on behind it. Many of it has come into effect, and a lot would come into effect in regards to the product in the near future for our sub-brands, yes. And regarding the online bit, online bit, yes, online, people are consuming products online. But we need to promote the online products digitally, which we are doing. And I would say online is not as upbeat as it used to be during COVID times, but it still has its fair share. A lot of people are buying online, but the other part is because most of the brands are offering discounts now almost 6, 7 months in a year, so the discounts that you get on your e-commerce sites, you are also getting it in the stores. So that way also, the sale is happening from the store also who are looking for the discount.

Okay. And my second question was, what is your outlook on the consumer demand trends for the upcoming quarters? And how does the company expect this to impact the revenue growth? Additionally, could you provide the guidance on anticipated margin and any key factors that may influence the probability going ahead?

Yes. See, sorry, can you just repeat the question once again?

So what is your outlook on consumer demand trend for the upcoming quarters? And how does the company expect this to impact the revenue growth? Additionally, could you provide guidance on anticipated margin and any key factors that may influence the profitability going forward?

Okay. Okay. So the consumer trend in the upcoming quarters, I mean, it should be good. It should be better than before, of course. But inflationary pressures remain where -- but this premiumization trend is there, and we are -- I will not comment now, but we are looking for some collaborations, also brand collaborations, et cetera. So through that also, we expect to have more premium customers walk into our store so that they can consume that product also and they can, what we call that they can have a look at our sub-brands also. So that is one, that trend is there. Premiumization trend is there. And the value customers, we have reduced the prices. We expect volume growth from that in the coming quarters. Along with that, we have also changed certain policies regarding the channels that we use for selling our products, which is franchisee, then company-owned outlets and then we have changed certain policies. So we -- due to the change in those policies, we are seeing rejuvenated, renewed sales growth in many a strong market of ours in Assam, Bihar and many other Eastern zone states. So keeping all these things in mind, I will not give any number, but I hope -- we hope -- we are all hopeful that we will have a good sales growth in the coming quarters.

Next question is from the line of [ Sahil Bora from A&S Associates ].

I have a couple of questions. My first question is regarding Ekart Logistics. Sir, the shift of warehouse operations to Ekart logistics is noted as a cost efficiency measure. Sir, can you give us some quantifiable cost savings and operational improvements expected from this transition?

Sir, mainly, we have shifted our e-commerce operation from our own warehouse to Ekart, so in our own warehouse, it was related to fixed cost thing. So when we move to this Ekart, it is a nature of variable, how much article we keep in that Ekart logistics, the cost is dependent on that. And in terms of the infrastructure, their infrastructure is much better compared to us because they deal with this e-commerce business. They have all these things, which reduces the sales return and also, we can do the claim at the proper time. And in terms of cost, there is around 20% of cost reduced from whatever cost we are doing in our own warehouse.

Okay, sir. And how has this affected the company's fixed versus the variable cost structure?

As I told you, the cost -- in terms of fixed cost that we are doing in our own warehouse through our own workers and through our own rented place, that has gone out. And in place, there is a cost in terms of, it's a nature of variable thing, how much we sell per unit cost. If we sell more, then the cost will be more. If we sell less, the cost will be less. But in terms of -- if we keep the same number of items, we have seen the cost has reduced by 20%. And also, we are able to get better infrastructure and better service to our customer.

That sounds promising, sir. Sir, I wanted to know if there are other similar efficiency initiatives underway or planned?

Yes, already in our own warehouse, we have implemented a new system. We used to -- the software that we used to do in our warehouse was our homegrown. Now we have shifted to D365, Microsoft D365 WMS, and we have already implemented the first phase. In the second phase, we have all this -- all the stocks will be -- means from the rack, it can be built, so that the FIFO basis of -- means in the physical count also, we can do the FIFO basis of billing, which will improve our -- the stock aging can be improved drastically and also the obsolescence of stock can be reduced. So these types of things are already in the pipeline, which will -- first phase is already implemented. The second phase will be implemented after the festive season.

Sir, my next question is regarding the expansion of the retail store network. So the retail store network has expanded by 18 new stores, which includes both company-operated and franchise outlets. Sir, I wanted to understand the strategic rationale for maintaining this mix? And how does the company ensure consistency in brand experience across the franchise stores?

We have -- last year, we have also closed our -- around 30 co-owned stores because they were loss-making. So we have taken a conscious call that in terms of loss-making store, we will not keep it. We will just close it, and we will open a store where the rental is less, and comparatively, the cost is lower. So that's why you can see only 18 has been added, but 30 stores of COCO has also been closed. So effectively, it will be a -- 48 store has been opened. And also, in terms of combination, we generally keep more on around 80-20 ratio of our own store to franchisee because in our own store, there is lots -- there is CapEx also. And in case of franchisee, the CapEx is on the franchisee. So this ratio will be maintained, so that the efficiency in the capital can also be done and the sales can also be increased.

And sir, lastly, what are the growth target for store additions in FY '26 and which markets or formats are prioritized for expansion in the retail network?

So as I have already told you, 50 stores, and that will mainly be in the Eastern, Northeastern side of the country and also in Southern India. So because in this geography, the brand is very prominent. And out of that, around 7 to 8 would be our own COCO stores, and the balance would be franchisees. Franchisee, it will be a combination of both EBO and FRM. FRM means we send the stock to the franchisee. And in the case of EBO, we sell the stock to the franchise. So, it will be a method -- both the method taken together will be around 40, 42 stores, and COCO around 7 to 8 stores.

We take the next question from the line of Akhil Parekh from B&K Securities.

I have 3 questions on the retail business and one on the distribution front. On retail, if I look at, our gross margins have declined over the last 4, 5 quarters. And one reason you have said that we are giving more push to volumes. Is it now safe to assume that the gross margins which we clocked in FY' 25 at around 56%, we are closer to the bottom now, and from '26 onwards, we should see stabilization in the gross margins and hopefully improve from there. That's my first question.

No, because if you see that in the last year, in the last 2 quarters, we have reduced the prices of Khadim, and the margin has come down. But this year, it will be a full year of operation of the lower prices. And in certain categories in children's products, in school, we have also taken a conscious call of reducing the price because of the economy. So I think the margin has not come down. But in FY' 26, it will come to a level playing field, which means in FY' 26, the margin will be the margin that will be sustaining for the next year. However, as our MD told that in the sub-brands, in some sub-brands, there are some products where we are increasing the margin, seeing demand and the acceptability. So with that also, we'll try to improve some margin. But in FY' 26, we'll bottom out in terms of the margin.

What would be the safe assumption for margins basically for '26?

So it's purely dependent on the volume thing, how much the combination of Khadim and sub-brand. So at present, I cannot predict what will be the margin, but it will be lower than whatever we have done in this year.

Okay. Fair enough. And would you be able to give the pre-Ind AS margins for FY' 25 for our retail business?

Can you come back again?

Pre-Ind AS EBITDA margins for the retail business for FY '25?

It's around 15.61%.

No. But these are post-Ind AS margins, right, not the pre-Ind AS...

Around 4% is the rent cost, so you can subtract it from that.

Okay. So, around 11.5% is the pre-Ind AS margin for FY '25.

Yes.

Okay. And just last 2 more questions. One is, would you be able to quantify the interest and depreciation cost for the retail business for FY '25?

Yes, that has already been given in our SEBI thing. Retail, and this is -- the result that has been given in the SEBI thing is for retail only. And the depreciation for the...

Sure. Got that point. And lastly, on the distribution front, would we expect this business to turn EBITDA positive from this year, FY '26?

FY '26, we will definitely be in the EBITDA positive, but it's dependent on other factors also, the volume and the prices. But definitely in FY '27, with the lowering of cost reduction initiative that will be taken this year, we will be profitable in KSR in FY '27.

The next question is from the line of Bhargav from AMBIT Asset Management.

Clarification, when you mentioned that margins in the retail business may be lower because of price cuts, you are referring to gross margins and not EBITDA margins, right?

Yes, yes, gross margin.

So because of volume growth, there is a case to argue that EBITDA margins actually expand given the volume growth, which can come in the retail, right?

Yes.

We take the last question from the line of Anupam Jain from Indira Securities.

What will be the ROCE and ROE for Khadim India for FY '25?

We can come back with this answer to you on a one-to-one basis, okay?

Okay. And second question that I had was that your franchisee store has quite increased since a lot, 5 years, if I have to see the number from 543 stores that have reached 673 currently. But yet, the contribution has not increased that much. So what will be your strategy -- after the demerger has already happened, what will be your strategy in this?

No. This is mainly because our franchisee, the sale that we book is MRP less trade discount. For that reason, also, it is less. And the franchisee in COCO, we booked the sale at MRP. So now there will be a mixture of FRM and TFM where the -- sale booking will be in the full value. So there, we will see that the franchisee -- means contribution will increase. But previously, the sales booking is a discounted value, and also mainly our franchisee consists of Tier 4, Tier 3, where the sales volume is also less. So both taken together, the franchisee sales remain lower compared to the COCO sales.

Overall, what will be the SSG growth, because I can see in the last 3, 4 years, there has been no SSG growth.

SSG growth will come only if the volume increases because since we are slightly decreasing the ASP. So if the volume increases, then only SSG growth will come. And with the macroeconomic scenario not so good, so we think that the lowering of the prices in the Khadim brand will improve the volume and that will bring the SSG growth in our store.

Yes. Volume degrowth has been arrested in the last financial year that has gone by. So now expect that volume growth would come, and that will give us SSG. Renovation is also being done in stores. That would also give us SSG. So yes.

Okay. And this athleisure apparel that you're launching, this will be launched in all stores?

Yes. No, we are expanding it to as -- many more stores. In the beginning, it was limited to around 20 stores. Now we are increasing it to around 50 to 75 stores. So we'll slowly expand it in all stores.

So when will it be fully scaled up? And especially when will this be fully scaled up in your company-owned stores?

It's there in our company-owned stores mainly and some of it, whichever franchisees feeling confident to keep it, we are also billing it to them. We have an aim to at least complete our entire company-owned stores by end of this year.

So that will stretch our working capital?

No, it shouldn't stretch because we are also canceling a lot of designs, which we feel is not -- I mean, it's not trendy enough anymore for the Indian economy. So we are keeping that check in our mind. Like nothing should put a stress on our working capital because we are also canceling a lot of designs, we are putting it in discount, trying to take them out whatever trends we feel does not work anymore for the Indian consumer. So that way, it should be fine.

So you're around looking at 40 stores in your company-owned stores to add your segment every quarter?

Yes, you can say it.

Around that is what you're targeting internally?

Yes.

And I had a last question. So you are majorly Kolkata brand -- East side driven company. More in the terms of brand visibility, it has reduced quite significantly in the last 2, 4 years after pandemic. And it is much more aligned with the older people. That is what the feedback has been generally. And there is a competitor that is providing much better at a lower price point and a better quality. That is what we are hearing. So how are you addressing that?

Sorry, can you -- who is offering what? Can you come back again?

Your peer in this segment basically is offering at a lower price point and a better quality, and the footfalls has been low due to that also. That is the feedback that we are receiving. How much light do you want to shed upon this?

No. Maybe some of the peers are offering at a lower price. But if you see our -- I don't know where you have got this feedback from, but if you see our product quality, the color combinations and such thing -- only problem which we actually had was for the last 3, 4 years, our prices had increased a bit too much, especially in the mother brand Khadim. So that's where some people might have said that the product has become too expensive, but we have taken a call on that, and we have reduced the prices. But when it comes to the product attributes and the color combination, the look, I think you should do more thorough research. I don't think it's that much affected. The price, we were affected for a while where we have taken the call.

Okay. Fair enough. So do you think the footfalls will come back? What is your footfall guidance for next year and what you're targeting internally?

I mean footfall guidance -- we want to grow our pairs. We used to be 1 crore pair a few years back. So we want to reach there as fast as possible and then grow beyond that. That would be the footfall guidance. And more than -- one thing is footfall and we also want to have -- we want to have meaningful stores. We will not -- just to have an unprofitable sale, open store wherever we feel like, we want to have stores in meaningful locations and -- so these things will help us to increase our sale and our footfall. I think there's a lot of scope left in that. The markets that we are in, in the existing market itself, there are many, many markets still left where if we focus and open the store, we can increase the -- you're asking for footfall and volume growth, right? The footfall will increase like that. Yes, because you have to open the store...

30%, 40% volume growth.

I won't comment on percentage, but some of the markets which we are focusing now in Northeast and many of the Eastern states where I felt, we felt that the sale has dropped much beyond what the Khadim brand popularity is in those markets. So now that we are coming back with a full-fledged renovated shops with fresh merchandise in those kind of markets in many Eastern locations, I think that would give the increase in footfall for us. That would be the main source of increased footfall, opening franchisees in these meaningful locations.

May I request that you rejoin the queue for further questions as there are several participants waiting?

Just one question. How many franchisees we have taken over because we introduced a new model also?

We are planning to -- we have taken over almost 50 now. So, we'll, as the opportunity arises, we'll take over many more, whoever is, wherever it's needed. It's not that we'll take over everywhere, but wherever it's needed, we'll do it.

We'll take the next question from the line of Akhil Parekh from B&K Securities.

Just one bookkeeping question. What would be our effective tax rate for the retail operations going forward in '26 and '27?

The effective tax rate will be 25.2% because the losses that we have -- was there in the FY '20 and '21 has already been adjusted with the profit for the next -- for the last 3 years. So now it will be on the, I mean whatever taxes that come will have to be paid.

As there are no further questions from the participants, I now hand the conference over to Ms. Masoom Rateria from MUFG for closing comments.

Thanks, everyone, for joining on the call today. I would also like to thank the management for sparing time and addressing the questions today. We are at MUFG, the Investor Relations, Khadim India Limited. For any queries, please feel free to reach out to us. Thank you.

On behalf of Khadim India Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.

Thank you.

Thank you.