Kuwait Projects Company Holding K.S.C.P. (KPROJ) Earnings Call Transcript & Summary

Good afternoon, ladies and gentlemen, and thank you for joining the KIPCO H1 2020 Earnings Conference Call. My name is Avi, and I'll be moderating the call today. [Operator Instructions] And I have the pleasure to hand over the call to Elena Sanchez to begin. Elena, please go ahead.

Thank you, Avi. Good afternoon, and good morning, everyone. This is Elena Sanchez, and on behalf of EFG Hermes, I would like to welcome everyone to the KIPCO 1H 2020 Results Conference call. It is a pleasure to have with us in the call, Mr. Pinak Maitra, Group CEO; Mr. Anuj Rohtagi, Vice President, Group Financial Control; and Mr. Moustapha Chami, Vice President, Finance and Accounts. The call will begin with a presentation from management of the key highlights of the first half of the year, and then we can open the floor for Q&A. At this time, I would like to hand over the call to Mr. Pinak. Thank you.

Thank you, Elena. Good afternoon, everyone. We are glad to have you all in our first half 2020 earnings call. We hope you and your family are keeping well and taking all necessary precautions to stay safe during these testing times. Our thoughts and prayers are with the victims of COVID-19 and their families. In today's call, we will cover both the first and second quarter 2020. Since Kuwaiti companies were exempted from publishing first quarter financials because of the outbreak of COVID-19 as per CMA directed. Please note that today's presentation is also available on our website along with quarter 1 and half yearly financial statements. As usual, we draw your attention to Page 2 of the presentation, which reads out a brief disclaimer. Some of the statements that we will be making today and the information available in the presentations are forward-looking. Such statements are based on KIPCO's current expectations, predictions and estimates and are subject to risks and uncertainties, which may adversely or otherwise affect the future outcomes. They are not guarantee of future performance, achievement or results. With this, I would like to move to Slide 4 of the presentation. The last 6 months have been unprecedented in more than one way. The world has faced one of the worst pandemics in recent times, that is COVID-19, which has affected every region and country. Globally, the government responded with lockdowns and travel restriction as a containment measure which adversely affected economic activities and business sentiments. The regional situation was excess berated by oil price meltdown, which significantly dented the economic parameters of region as depicted on Slide 4 in the MENA 2020 GDP contraction is forecast to be of 5.7%. The response of the global regulators to the economic shock associated with COVID-19 has been swift, giving some flexibility to navigate the worst part of the crisis. The situation is still evolving as best case or a second wave in the fall or winter of 2020 poses risk. Additionally, the timing of mask availability or vaccines or other medical solutions is highly uncertain. And therefore, the length of the pandemic and its impact is equally uncertain. However, recent times has given us hope as oil prices have recovered significantly, together with the speedy completion of Phase 1 and 2 of trials for medical solutions, with vessels for Phase 3 expected in late 2020. A number of forecasts are out there. We have chosen to be positive and are showing the IMR forecast for the region, which shows a rebound in 2021 with a 3.4% GDP growth. Moving on to Slide 5. Our group companies have proactively managed the situation and have done everything possible to look after the 3 key parts of our stakeholders: Our employees, our customers and the society at large. We have worked on supporting our employees to let them work from the safety of their homes while ensuring our customers face minimum inconvenience. At the same time, we cannot overlook the people in our society who are suffering due to the pandemic. KIPCO group companies have donated circa $11 million to show our gratitude to the society, which has given us so much over the years. Now moving on to Slide 6. KIPCO portfolio companies are diversified across sectors, which are commercial banking, insurance, asset management and investment banking, media, real estate, industrial and education. Each of the sectors were affected by COVID-19 by varying degrees. Our companies in insurance, media and education accounting for circa 30% of the group revenue were least impacted. While insurance impact due to this -- due to slowdown in new business in motor and travel, COVID-19 also resulted in reduced health and motor claims. Given GIG has a significant portion of corporate businesses, impact was limited. In fact, GIG's revenue increased in both quarter 1 and quarter 2 2020. So in some sense, performing better than the sector. Media was another sector, which performed reasonably well. Lockdown resulted in large increase in content consumption, while lack of sport events and new content production impacted players. The sector responded with direct to video releases of movies on their pay TV platform, releasing stock press series and rerun of old shows. Moving on to the education sector. Online education insured academic sessions continue as students are learning while staying at home. Then in the lead are sectors which are impacted to a moderate extent, accounting for 51% of the group revenue due to the pandemics impact. And the oil price effect together with regulatory actions to soften the long-term effect on economy and consumer confidence. Commercial banking profitability was negatively impacted due to reduction in discount rates impacting margins, interest and principal deferrals resulting in modification losses and economic slowdown impacting asset quality and cost of credit. Nonetheless, a clear positive has been the building of immense trust in the banking sector, which goes to the occasion to support businesses and ensured minimum inconveniences to the customers through commitment and also use of digital ways of working and delivering. This will have a positive impact on banking profitability in the medium-term with improved customer experience and lower operating costs. Burgan Bank also expedited its digital journey, launching a new solution for a merchant called [ Tijaradi ], which is first of its kind in Kuwait and launched a new retail app in Feb 2020, which now has around 24,000 customers. Moving on to Slide 7. Our industrial portfolio, accounting for 4% of our group revenue comprised of petrochemicals and food sector, which experienced opposite business trends. On one hand, petrochemical sector was significantly impacted due to the double whammy of reduced demand and oil price meltdown. Food sector witnessed increased demand for long life essentials. However, both the sectors saw disruptions in supply chain due to lockdown and cross border trade. Our investments in real estate and asset management and investment banking accounting for 16% of our group revenue that hit the worst due to lockdown induced rent waivers, capital market volatility toward web generation. However, we view these trends as temporary. And these businesses to recover sharply with the ease in lockdown restriction and return of life to normalcy. Thus, on an overall basis, 30% of our portfolio had minimal impact, 51% moderate impact and only 16% significantly impact. As you can see from this data, the diversification and investment strategy of the KIPCO group played a key role in protecting us from the worst of the COVID impact. I will now hand over to Mr. Moustapha to provide you with KIPCO financial performance update on Page 9 of the presentation.

Thank you, Mr. Pinak, and good afternoon, everyone. I hope you and your loved ones are staying safe. Kindly note, 2019 financials were restated due to a change in the classification of OSN after an increase in ownership. Please refer to Note 2 and 3 of our first half financial statements for details on the restatement. As highlighted by Mr. Pinak, KIPCO Group has been impacted by COVID-19, especially in the second quarter, the 3 months ended June 2020. Referring to Page #9 of the presentation, revenues have increased by 15% in the first half of 2020 to reach USD 1.272 billion compared to USD 1.104 billion in H1 2019. The increase in revenue was led by an increase in investment income, partly offset by reduced interest income and hospitality and real estate income. The increase in investment income was a result of a remeasurement gain on KIPCO stake in PMGL, post its consolidation in accordance with the IFRS 3 rules on business combination. Led by quarter -- during first quarter of 2020, KIPCO reported a revenue of $756 million, which was 39% above the $542 million reported for the first quarter of 2019. However, the second quarter of 2020 revenue was impacted by COVID-19 and resulted in 8% decrease in revenue to $516 million from the $561 million reported in the same period of 2019. The decrease was largely driven by lower interest income and lower hospitality and real estate income and also lower investment income. We have reported a net profit of $30 million for the first half of 2020, this translates into an EPS of KWD 0.0046 per share or $0.015 per share. In the first quarter of 2020, KIPCO reported net profit of $94 million compared to a loss of $16 million reported in the same period of 2019, while for the second quarter of 2020, KIPCO reported a loss of $58 million, mainly driven by COVID-19 impact on group companies as compared to a loss of $43 million in the same period of 2019. Now I will hand over the presentation to Mr. Anuj.

Thank you, Moustapha. I hope you are staying safe and healthy. We now move on to discuss Burgan Bank's results that are on next slide, Page 10. Since Burgan Bank held its investor call yesterday, we will be focusing on some of the key highlights in our presentation. Before we begin, with -- reminding you once again that during the year 2019, Burgan Bank's results included a 1-month lag in terms of its subsidiaries financial reporting. As such, quarter 1 2019 and H1 2019 numbers should be read within this context for comparison purpose as 2020 numbers are for full 3 or 6 months. In addition, Bank of Baghdad, which was classified as asset held for sale, in the financial statements as of December 2019, has been consolidated in the financial statements as of June 2020. The reclassification was driven by cancellation of Bank of Baghdad sale due to uncertain macroeconomic conditions following COVID-19. The loan book increased by 3% at the end of H1 '20 versus 2019. Continuing with its strategy, the bank has been targeting growth in Kuwait, while following a cautious approach in its subsidiaries. As a result, loan book growth in Kuwait, which increased by [ USD 510 million ] or 5% in H1 2020. And also consolidation of BOB was offset by reduced loan book in Turkey by [ 7.7% ], that is $221 million compared to 2019. Deposits grew by 6.8% in H1 '20 versus 2019 from Kuwait operations where around $1.5 billion deposit were added in H1 2020, that is 17% growth and BOB consolidation impact, USD 714 million. Operating income for H1 '20 was $350 million, lower by $28 million compared to H1 '19. Further, if we then look at the quarterly breakdown of performance, the revenue in quarter 1, '20, was 20% higher than reported quarter 1, '19, while quarter 2 '20 was 29% lower than corresponding quarter in 2019. The decline in quarter 2 was majorly driven by Central Bank discount rate cut of 25 basis points in November 2019 and further 125 basis points in March '20. And reduced economic activities also impacted the noninterest income. Following this rate cut, net interest margin for the period H1 '20 decreased by 22 basis points to 2.2% during H1 '20 versus 2.4% in H1 '19. If we adjust for the 1-month lag in H1 '19, there was a decline of around 50 basis points. Provisions charge to P&L increased to USD 107 million during H1 '20 as against USD 52 million in H1 '19, driven by higher ECL provisions in the backdrop of macroeconomic and business conditions. This includes USD 32 million countercyclical precautionary provision booked in quarter 2 '20. As a result of the above-mentioned movement, Burgan Bank group posted a net income of USD 74 million in H1 '20 versus USD 145 million in H1 '19, a decrease of 49%. NPA ratio increased to 4% at the end of H1 '20 as against 2.1% in 2019, primarily driven by higher NPAs in international operations, mainly Turkey. And impact of BOB consolidation. The bank reported a CET1 ratio of 10.8% and capital adequacy ratio of 16.2%. Moving on to Page 11. The regional loan book declined by around $100 million. The reduction in Turkey loan book was offset by BOB consolidation. Overall, share of our regional loan book and customer deposits was 27% and 30%, respectively, of total Burgan Bank's loan book and customer deposits. The net profit of regional operations was lower by 38% during H1 '20 versus H1 '19 due to interest rate cuts and challenging macroeconomic conditions, as mentioned earlier. Can we please now move to Page 12, which is about Gulf Insurance Group. For the 6 months ended June 30, 2020, GIG has posted strong results. Gross premium return was USD 749 million, registering a healthy growth of 31% over USD 571 million reported last year. The increase is majorly driven by the medical business. On the bottom left chart, you can see that combined ratio stands at 92%, which is a 2% year-on-year improvement. This improvement is majorly driven by lower claims incurred in medical, motor and general accident segment, which resulted in overall 2% reduction in ratio -- loss ratio. If you look at the top right-hand side chart, net investment income for H1 '20 has increased [ 4.19% ] to USD 22 million from USD 19 million last year. The correction in securities market that happened by the end of March 2020 has been offset by booking gains in quarter 2 of 2020. GIG reported a net profit of USD 32 million for H1 2020, a 21% growth over a profit of USD 26 million in H1 2019, driven by prudent underwriting and investment approach of the company. On the operations side, making further progress on digitization projects remains the key, and the group is adopting necessary strategies to transform its operations in terms of distribution of products, claims, services and other supporting functions. I will now hand over to Mr. Moustapha to cover the next couple of pages.

Thank you, Anuj. We can move now on to United Real Estate on Page 13. On the top left chart shows USD 172 million of revenue for the half year ended June 30, 2020, representing a decline of 3% versus the same period of last year. This was a result of decline in rental and hospitality revenue by 41% due to rent waivers and temporary shutdown of hotel businesses during lockdown in different regions. This was offset by higher contracting and service revenue by 13% contributed by URC's contracting arm UBC. Operating profit declined by 84%, driven by lower revenues and higher property operating costs. On the bottom left chart, you will see net loss stood at $18 million during the half year ended June 30, 2020, from a profit of USD 8 million in the same period of last year. The net loss is driven by decrease in revenue, as I mentioned earlier, and evaluation loss on investment parties. Moving on to Slide 14, which has United Gulf Holding Company. You can see on the top left chart, revenue for the first half of 2020 was $64 million, which reduced from $120 million in the same period of 2019. This is largely on account of a sharp decrease in investment income, owing to adverse market movements, along with the reduction and share of results from associates to USD 5 million in the first half '20 from $25 million in the same period of 2019. Investment income decreased from $28 million in the first half of 2019 to a loss of $9 million in 2020. On the top right chart, provisions for credit losses increased to $16.4 million compared to $0.5 million during the same period of last year, mainly driven by the uncertainties caused by the COVID-19 pandemic on different sectors, while estimating ECL requirement, along with customer-specific factors that cannot be segregated from COVID-19 impact. On bottom left chart, you can see UGH reported a net loss of $31 million the first half of 2020 as compared to a profit of $10 million last year. The decrease in profit was a combination of lower revenue and higher provision considering uncertain market conditions. Provision for first half of 2020 increased to $19 million from $2 million in the same period of 2019. UGB's total consolidated capital adequacy ratio stood at 17.7% as of June 30, 2020. I will now hand over to Mr. Pinak to cover the remaining pages.

Thank you, Moustapha. Let's now move to Page 15, which talks about OSN's growth and outlook. While in 2019, OSN strengthened its content rights with ability now to distribute across the MENA through OTT. In 2020, OSN has grown its rebranded OSN streaming OTT platform, with OTT sub tripling to greater than 250,000 in 4 months, with partnerships already signed with over 15 major telcos across MENA region. OSN is expected to accelerate its OTT growth in both key markets as well as low-income markets. Further, direct OTT sale is showing accelerated run rates and with contents like Disney+, HBO, NBCEU, et cetera and OSN's own Arabic originals. OSN aims to capture a substantial portion of the growing MENA OTT market. MENA market is highly under-penetrated when compared with western and emerging markets, and thus, this presents a significant opportunity for OSN to lead penetration increase, along with increasing market share amongst existing base. OSN is now operationally stronger with strengthened management team, reduced cost base and improved technology platform. Further, OSN is producing original non-scripted Arabic shows with first shows releasing in quarter 3 2020 and more in quarter 4 2020 and 2021. This would add further value towards OSN's existing strong content base and enhance OSN's streaming as well as DTH demand. In addition, with a strong OTT proposition as well as newly launched low-priced DTH product, OSN is heading to expand its footprint in low-income MENA countries with huge population but lower TV and OTT penetration. OSN EBITDA for the first 6 months of 2020 is significantly above the budget presented in November 2019, pre pandemic by 94%. This continued in July 2020. This confirms the trend that OSN established in 2019, where the actual EBITDA results were ahead of the budget by 17%. We remain hopeful that in early 2021, OSN will deliver positive EBITDA results. Moving on to Slide 17. United Industries reported USD 8 million net profit during the first half of 2020, which is a 66% reduction than the first half of 2019. This drop can be attributed to decrease in its share from Qurain Petrochemical Industries company during the period. Jordan Kuwait Bank reported a steady operating performance as seen through a net interest margin of 3.5% during first half of 2020, slightly below the 3.7% reported in first half of 2019. However, the bank reported a net loss of USD 8 million for the period compared to the profit of USD 23 million during the same period of last year. This is largely due to higher provisions where the bank, in the wake of macroeconomic condition, which increased 3.3x versus the previous period to $36 million from $11 million. These were the highlights for first half of 2020 results. Our group companies are slowly coming back to normal, just like the rest of the world, and business activities are picking up as we speak. We continue to have a solid cash position and a strong financial profile with no debt maturities over the next 3 years. As a group, we are focused on sectors which are naturally profitable and have low penetration in the region. And in turn, diversifying our presence in countries with young demography. Our efforts in digitization will enable our companies to achieve this vision. We are optimistic that we'll be back to quarterly profitability soon aligned to revival in economic activity and momentum. I'll now hand over to Abi to invite our listener to raise any questions they may have.

[Operator Instructions] Our first question comes from Alex Ayoub from Waha Capital.

Just a few questions, please. Can you tell us how much cash you currently have at the holding level? From our estimates, you have about $0.5 billion and you plan to come to the bond market to get more cash? I thought that you usually try to have at least enough cash to pay the next debt paying, which is, I think, $815 million in 2023. That's the first question. And the second question is about OSN sale. Can you give us a bit of update on OSN sale? Are you still planning to sell that this year? Or this is likely to grow next year? Or you're not planning to sell it anymore? And lastly, can you please tell us what's your current LTV? And what is your strategy in terms of maintaining your LTV, around which level?

Thank you. So we'll go one by one. You asked for the cash balance. As of June, we had around $1.2 billion, we obviously repaid the $500 million in July. And currently, we'll have around $700 million left. So that's a rough number as of now. If I ask Moustapha the exact number, probably will have the exact numbers, I'll get back to you on that. In terms of the LTV number, we have been maintaining around 38% LTV. And our strategy, obviously, is partly driven by a temporary impact that the COVID situation has on our -- the portfolio value. Directionally, we are targeting ourselves to be within the rating guidance. We believe our assets are under value. And as the situation progresses quarter-on-quarter, we will be guided by those factors how we move towards that 30% to 35% level.

I'll take up the OSN question. We continue to believe that the media business is a global business. As we said in our previous earnings call and conferences, we are preparing OSN to have partners. Partners who will bring value to the operations of the business. That journey is progressing well. And so we are quite optimistic that the way the business is evolving. We will attract many partners. Given the reality of COVID where things have greatly disrupted to all businesses, we believe that, that is likely to be a 2020 item, but very much in forefront of our thinking and all the actions. But the encouraging part is that without the partners, we are doing fantastic. And with the partners, we'll be quite excited to report to you all how much more than fantastic we will do. So it's a great place to have very difficult 3 years. And to come out on the right side of it.

Definitely. So just to clarify on the LTV, are you planning any equity injection to support the equity in these tough times? And then just on the bond market, are you planning to come to the bond market to support liquidity at the holding level?

So the usual guidance we gave you was that before 12 months of maturity, we want to have enough money to pay for the bond. And I think that we are following the same script that we have been following for the last 20 years. So yes, we will have sufficient money organically to pay the bond off. But yes, we will look at market opportunities. If interest rates get to what is attractive to even more attractive levels, we will have that option available to us. Currently, we are not thinking of it, but we will always be driven by market opportunities.

We currently have no further questions. [Operator Instructions] Our next question is from Rakesh Tripathi from Franklin Templeton Investments.

Could you talk a little bit about the cash flows during H1 and your expectations for the full year for the [ holdco ] level in terms of dividend receipts, your expectations on the operating costs and interest outflows and related things?

Yes, Rakesh, thanks. So as we guided you in our last call, we are expecting around $90 million of inflows, primarily from dividends. Almost all of it is from dividends. Most of these have been received. In terms of expenses, the interest expenses are around $150 million, OpEx around $30 million. So these are the key numbers.

Okay. So those are all dollar figures, right?

Correct. All numbers we are using are dollars number, correct. And these are for full year 2020.

Okay. So $90 million, you said are expected dividends and bulk of it has already been received in H1?

Correct.

We have another question from Alex Ayoub from Waha Capital,

Sorry, I have a few follow-up questions, but I'll take in to 1 or 2, and I will jump back to the queue in case any other investors want to ask questions. Just on the rating. So how committed are you to your high-grade rating? I heard you were downgraded by S&P? Are you having discussions with Moody's? What do you think is going to happen there? Can you just tell us how committed you are to the high-grade Moody's rating, especially in these tough times?

So our commitment has been consistent. And so that position remains. We are in regular dialogue with the rating agencies. And so the past practice has continued through the COVID. So not much change there. We expect that in 2021, the numbers will itself make the case for us. The rating agencies took the action in April, S&P. And [ that is it ], given the fact that they tend to be conservative. We believe that the values will show up. And once oil prices get more stabilized, the Kuwait market would also rebound. So we see it all happening organically. And therefore, we believe that it is not appropriate for us to react in panic and be overly conservative. So that's perhaps our response to your first question.

Got it. Sorry, just on this one, like would you consider additional equity injection to support your rating? Or not necessarily at this stage? Because...

As management, we obviously -- sorry, please complete your question.

Sorry. Because the LTV is above the threshold. So previously, in the previous years, they used to inject some equity to support the LTV. I was wondering if that is still being considered, not necessarily.

So from an option point of view, we look at all scenarios. We look at debt, we look at equity, and we have it trigger ready, meaning that we can pick it up if we need to, given a significant amount of cash we have. And given the fact that we don't need any liquidity for the next 3 years to pay off any maturing debt. We believe it's not prudent to inject equity now. The rating ratio is a rating ratio, which is a mass -- it's a calculated number. We, as management, have a understanding of the underlying values of the business. And we believe that like many good companies in the world, 2020 will be in a variation. And in 2021, will go back to normalcy. Therefore, what I told you was that organically, will correct itself. So when things are naturally happening, perhaps it's not prudent to intervene and create more liquidity when liquidity has very little value from the point of view of earning something on it unless you invest it.

So that's a very good point. And just sorry, on OSN, I -- somehow my line was not great. Did you provide some numbers on OSN? Can you tell us roughly how much was the EBITDA for the first half? Are you profitable or not yet? Can you give us some financials on OSN?

Yes, we wish we could. We have a partner in that business. And therefore, we are trying to respect the -- it's a private company, right? And so we are a public company, OSN is a private company, it's a partner. So it's not the easiest way to -- us to share. So therefore, we gave you 4 percentages to give you comfort. And comfort we gave you in the -- during our discussion on the quarter first half earnings call was that clearly the growth business, that's the OTT has grown significantly, and we said that related to the December base, our customer base has grown by 3x. So -- and we gave you a number up to $50, 250,000 subscribers, and we are earning roughly [ $9.99 ] like most OTT app. So you can do the math. Now in terms of the EBITDA, we have directed you that in first quarter of 2021, we are going to hit the positive numbers. So to that extent, we have tried to help you think through and keep comfort that as KIPCO, we continue to feel comfortable and hopeful about the increase in value of OSN and the profitability for OSN both. I'm sorry, I cannot give you much more than that.

Our next question comes from Mark Agaiby from BlueBay Asset Management.

I just had a follow-up on one of Alex's questions regarding the progress on the OSN partial sale or bringing in partners. So you mentioned that in the current environment and COVID, et cetera, that any developments on this was likely to be 2020? Did you mean 2020? Or did you mean that it was to be, maybe, delayed to 2021? That was the first one. And the second one was just given the cash clear gap between dividend received and interest expense and OpEx. How would you in the next few years attempt to get that closer to a onetime coverage rather than the gap that we currently see? And sorry, just a clarification. When you say guided to positive EBITDA in Q1 2021 for OSN, is that on a positive -- on a quarterly basis or on a -- last 12 months? They are my questions.

So in terms of the projection for getting a partner, we want to say 2021. And we spoke 2020, we misspoke, okay? So that's one answer. Then moving on to the question of...

The cash flow coverage, onetime.

Cash flow onetime. We believe that it's a function of our operating businesses delivering better results. And we see that if you look at 2019 as a trend and then extrapolated forward in 2021 and 2022, we believe that around that time frame, we will get to that -- the target that you are directing us organically. And when we are saying this, we are still assuming that we will be in the legacy business more than we have been for the past 20-plus years. Clearly, as a group, we are changing. The group is digitizing actively. In 2021, first half, we will start giving you guidance on the impact of that on our results. So to simply put, we believe that the organic results will get us closer to a onetime coverage sometime in 2022. We believe that digitization will accelerate that. So that is a long way to think about it. The other piece is to think about it is that as OSN is growing in value, and as the partners come in, there's going to be a significant cash injection that will come into our business. There are other businesses also that we believe are exit opportunities for the group at a significant value over our current cost base. And therefore, the combination of these 2 will make us [ comfortably ], and that's why I made the point that there is a good chance, although nothing is guaranteed in life, that by 2022, we will have sufficient cash to have the ability or the option to pay off our debt maturing in 2023. There was a third question?

I'm sorry. Sorry, I think...

Did I answer all your questions, Mark?

Yes, I had a third one, but I can't remember what it was now. I'm sorry, I was just -- it was on the last 12 months EBITDA. Was the EBITDA, in Q1, was that quarterly or last 12 months?

Correct. So the third question is that it's the -- it's going to be that for that quarter, not last 12 months.

Okay. And sorry, just one last thing, sorry. Previously, you've spoken about how there could be a [indiscernible] might need further capital injection from one of your JV partners. Obviously you have the majority stake now compared to the other partner. So any color on that? Do you still think that [ you might need ] -- obviously, this impact [ is actually ] would be much smaller than the previous one. But would you expect there to be one? Or how is OSN now? Given that it's getting to a positive EBITDA territory, do you think there will need to be further equity investment from you or you and the other JV partners?

Thank you, Mark, for the question. So the company has not asked for any new capital injection since the first quarter. And so that's the good news. So the company, that's a real proof that business is getting better. We don't expect significant amounts of need. And so for both the partners, it becomes an easier amount, if there is a call. And for modeling purposes, if we want to do and we believe and attribute a very low probability, and that will be done to significantly enhance the revenue capture of the business. And so it will be a growth driven capital injection rather than what has happened in 2018 and 2019, which was a restructuring investment. So that's different in nature. And so all the injections that if anything that management requires will be in the $25 million, $50 million range, but that is a very bullish and extremely conservative forecast that we are putting out. But we don't see management asking any of that. We are just giving you some color for you to think about it.

And Mark, Pinak's comments of injection into the company was into KIPCO because of the partnership. That was his comment previously.

Sir, what are you saying, sorry?

Well, Pinak mentioned about injection work in the previous question's answer, he was mentioning into KIPCO, not into OSN.

We currently have no further questions. [Operator Instructions] We currently have no further questions.

Thank you so much. We really appreciate Abi, Elena, and all of you who are on the call for participating in the call. Again, please take care, wash your hands, the 3W that we have been spoken of, let's all practice it because we all have a joint responsibility to each other. Thank you so much for participating in this call. Good afternoon.

Ladies and gentlemen, this concludes today's call. Thank you so much for joining. You may now disconnect your lines.