Mega Lifesciences Public Company Limited (MEGA) Earnings Call Transcript & Summary

[Foreign Language] I'm Vivek Dhawan, CEO of Mega Lifesciences. For a lot of people who are English speaking, we're going to try and do this in English, right? Because I can speak Thai, but I would -- we probably have a lot of investors from other parts of the world. So with me, we have our CFO, Mr. Thomas Abraham, who is along with me, I have a finance head, the Deputy CFO and our Head of IR, Mr. Manoj, and we have our Vice President, Finance, Mr. Francis also, Francis Rego. So we have 4 of us joining this call. So without spending any more time, let's begin the call. I'm going to let Manoj give you the background because I'm sure all of you have seen the MD&A. And before I go into further details of how the year looks like, the year ahead and what we see going forward., I would probably like Mr. Manoj to give the -- some detail. And if you have more questions, we can follow up with that a little later. So Manoj, over to you. Thank you, everybody. Please, Manoj?

Thank you very much, sir. Good afternoon, and a warm welcome to everyone for the third quarter 2022 earnings call. I will first take you through the synopsis of 9 months 2022 performance. Our overall revenue has been at THB 11.8 billion in 9 months 2022, reflecting our overall growth of 8.6% Y-o-Y. The branded business revenue has been at THB 5,991 million, representing a growth of 14.3% Y-o-Y. The branded business has grown because of strong consumer demand for our branded products. All the regions performed well. Southeast Asia contributed to the maximum. The distribution business has been at THB 5,568 million, which has grown by 3.4% Y-o-Y. Despite the challenges we had in Myanmar, still we have been able to maintain the sales of our distribution business. In terms of gross margins, our overall gross margins have been at THB 5,248 million, and gross margin as a percentage to the revenue has been -- has improved to 44.5% in 9 months 2022 as compared to 41.4% in 9 months 2021. The improvement in the overall gross margin is primarily coming because of the growth in branded business, because branded business has grown at over 14% as compared to distribution business. And the branded business gross margins also have remained healthy at 67.6%, which has reflected the overall improvement in gross margins for 9 months 2022 as compared to 9 months 2021. The distribution business, gross margins have remained steady. Normalized distribution gross margins have been at 17.8%, 9 months 2022 as against 17.2% in 9 months 2021. The SG&A has remained steady at 26.8% in terms of value, THB 3,167 million as compared to 26.4% in 9 months 2021. And our reported net profits have been at THB 1,840 million, reflecting a growth of 27.3% in 9 months 2021. And the adjusted net profits have been at THB 1,881 million, reflecting a growth of 34.6%. The adjustments mainly are pertaining to the forex gain losses and the losses arising on account of new businesses. So overall, in synopsis for 9 months 2021 -- 2022, we have grown our profits primarily driven by growth in the branded business, and better segmental gross margins and overall stable SG&A. Our operating cash flows for 9 months 2022, we have been at THB 974 million, which represents 53% of the net profits. The operating cash flows are likely to improve by year-end. We continue to remain a net cash company with a strong balance sheet. We have spent around THB 243 million towards CapEx in 9 months 2022, which is mainly towards expansion of our manufacturing facilities and capacity expansion in our manufacturing plant in Thailand. Out of THB 243 million, THB 190 million has been stepped -- spent towards that. And going forward, we expect the CapEx to be around THB 475 million, which is primarily coming from Thailand and Indonesian plant. Thailand, we expect to spend THB 268 million further for consolidating our manufacturing operations and capacity expansion and THB 46 million towards ESG. And in Indonesian plant, we expect to spend THB 161 million, which is towards adding new dosage forms, warehouse and plant upgradation for our newly acquired Indonesian facility -- manufacturing facility. We have, in all, plan to launch 16 products overall, out of which 11 products we have already launched in 2020 -- in 9 months 2022. Also giving you a very short synopsis of our quarter 3 2022 performance. Overall, our revenue has been at THB 4,052 million, representing a growth of 1.3% Y-o-Y. The branded business revenue has been at THB 2,034 million, and it has remained flat, but this is in comparison to the best-performing quarter, which was our third quarter 2021 in terms of revenue. We have still been able to maintain the levels of sales the branded business made last year. Distribution business has been at THB 1,928 million, which grew at 3.3% despite the ongoing challenges in Myanmar. Overall, our gross margins have been at THB 1,864 million, which is 46% of the operating revenue as against 43.3% in third quarter 2021. The branded business, gross margins remained healthy at 67%. And the distribution business, gross margins normalized, have been at 19.6% as against 17%, mainly coming from the principal mix. The overall SG&A has remained steady at 27% for both the periods, third quarter 2022 and third quarter 2021. And our reported net profit for third quarter 2022 has been at THB 658 million, representing a growth of 7.7%, and THB 690 million adjusted net profit, representing a growth of 26.2%. So this is a very brief but synopsis of financials for 9 months 2022 and third quarter of 2022. Now we may open the forum for Q&A. [Operator Instructions]. And thank you very much to everyone for your participation.

Thank you, Manoj. We can take questions now, and I can give you a little quick brief, if you like, and then we can open it up, a very short one. And Manoj has covered most of the things. I think our medium-term guidance still remains that in the next 5 years, that 2025 will double our bottom line. So we did 1,200 something '19 -- in 2019, and we expect to do at least [ 2,500 ], '24, something like that, about that we are aiming for, and we are still confident of achieving that in spite of all that happening around us. So that's the first thing. Please remember that we were at THB 1,200 million in 2019, right? So it's a big difference and we were planning to do that in 5 years. We are very close to it and we'll get there in spite of all the troubles that you see around us. Number two, in 2022, remaining period, we are -- we said that before, we are still saying mid- to single digit -- mid-single-digit growth. I think we stand by it, we should achieve an overall mid-single digits growth, and we should have double-digit growth in profit. So I think those 2 things have a very high likelihood of happening in the remaining part of the year. That's number two. Number three, 2023, we are still projecting that our branded business will grow from mid- to high single digit. That's one. Distribution business has a possibility of taking a hit because not largely at the bottom line, but largely on the top line because of the consumer business and the scenario in Myanmar which is unpredictable. So I cannot make guesses, but we are very well prepared. We are very tight. We are very efficient. In spite of all that, the pharma business will do fine. The consumer business can have an impact. But we are looking at all possibilities and let's see how things look like, but we are not going to project anything on the distribution business at the moment. So the branded business still has got a high single-digit growth possibilities in the year 2023. And these are 3 key factors I wanted to tell you. And then I said, why, in spite of the COVID impact going away, in spite of vitamin C, D, et cetera, not growing at the rate they were growing, they are still maintaining a new high, number one, compared to '19. Number two, a lot of our other business, whether it's herbal, whether it is supplement, whether it is our OTC drugs and our pure pharmaceuticals are taking off and growing and doing far better than they were doing during COVID time. So we have a strong balance of both. So that's a very good sign. At the same time, we have a strong pipeline of 186 products, 186 products, out of which 58 products are pending registration, 128 are under development. And there are probably a new trial of about 37 of, what we say, consumer health and prescription is about 143, and over the counter in the consumer health is about 6. So we have a nice strong pipeline of drugs and new products coming in. So with that, we believe with all this happening and the work we are doing, the possibility of achieving THB 2.5 billion in '25 remains very, very high, right? So I mean there are -- I'm sure you have a lot of questions in your head. Thai baht does affect our profitability and Thai baht helped us. But at the same time, the mix of products, the branded business, the growth in manufacturing, a lot of other things that also contributing to our growth in profitability. The baht has an impact, but so does many other factors that have impacted our business, right? Branded business growth, largely in the last quarter, in the 9 months has been because also our [indiscernible] business has grown. Also, our over-the counter drugs have grown. Also our other supplement other than COVID supplements have grown. So it's across the board, it's not just -- it's not -- the COVID business is not growing the way you saw in '21 or early '22, but still -- is still staying strong. Overall, we are doing better than we thought or anybody thought we would, right? Distribution business has the same story. Vietnam [ and Cambodia ] are doing very well, still doing well because we largely do pharmaceuticals. Myanmar, with their country economics, the situation we are in, we are still in good shape. We are committed to be in -- to Myanmar. We are not going anywhere, and we believe in the long run, we still have a great opportunity to succeed in the country as things get changed and turn around. And by the time we are watching and doing what is best in the market to ensure growth and maintaining what we have in hand, right? Other than that, I'm sure, I mean the FATF and all the other stories are well aware, the impact is limited. Myanmar, I've seen that before. It was already under all kinds of restrictions when we started in 2011, '15 until it got out of it. And things got better, but it has not impacted because our business is actually pharmaceutical. So we are in the -- we are not -- we are doing clean business, and I think the impact on our business is very limited. And we continue to fund -- source money through the banks and continue to pay, et cetera, for our pharmaceutical business that we are doing in Myanmar. So the guidance has also come out from the Myanmar government, Central Bank as well as the facts that we hear around you, which I'm sure all of you have a lot of knowledge. If you need more information separately, either Manoj or Francis can take you through because this is a long requirement list that you can see. Myanmar is going to be an issue and it's going to remain until the situation improves. But as I said, we are monitoring carefully, and we still, if anybody has, we still have a very good head start. Because we have a great brand. We have product that have gone for 25 years. We have local companies and generic brands. Our business is not only high end, most expensive. So I think in this scenario, a well-known product, expected product people who take it regularly have a chance to at least continue, if not grow your businesses. So we stand in a stronger position in Myanmar than probably many other people. That's what our belief is based on the model we have in place. Indonesia, very good. We have got a lot of products approved. Now we have a lot of oncology drugs coming out, and we are hoping to see better years coming ahead because of the pipeline we have and the products we have with that. But we always told you integration is a 5-year story. It won't happen [ overnight ]. By 27%, we have a target of getting to $30 million, which we are very confident of achieving with the pipeline we have and the work we are doing in the country. So please give us time. Drugs take time and it's going to take some time to get that movement to happen, but there is thing - good things happening and good growth happening in that area. CBD, let's not talk about it too much. It's all over the streets. Mega has products ready. But under the new regulations, we shall see what happens. Well, it's not something that we are very concerned about and not something that we are very much in a hurry to launch till we have clarity, until we have the right product. But we are ready. As the laws get more clear, we will be in a position to launch and supply to the Thai market. So other than that, I think most of it is well explained in our MD&A. And if you have any questions that go beyond what we have covered and things you want to know more about, which we can talk about now, we open the floor to Q&A. I have nothing more to add. The manufacturing facilities and all capacity expansion, but we explained already what we are doing in Thailand and Indonesia is part of the requirement, GMP facility improvement, efficiency improvement. And we are doing a lot of work in that area, ESG. We've also just got our TSSI, we got listed in it and the top 170 companies in the country. So I think all those things are moving in the right direction, and the factory has also done a lot of work in solar and energy savings and efficiency in many, many areas. At the same time, improving output and growing our production capability. So all that work continues. And we are, as I said, confident of delivering our plans for 2025. '23 is still -- in our plan is still a growth plan. We're still going to grow our branded business between the high single-digit range, somewhere there.

[Operator Instructions] Over to you.

This is Thanapol from CIMB. So I have a quick question pertaining your distribution business in the third quarter. So first, if you look at your MD&A, it says that the gross margin for the segment was 24.5%, which is highly unusual for the business. So is there any particular reason for this? And what is the level that we can expect going forward? And if I may ask a follow-up question, we know that the government is not giving out import licenses in Myanmar. So I would like you to have some more color on the demand situation in the Myanmar. So if the government does allow imports again, do you think there will be demand to support whatever your clients are importing into Myanmar?

I think the pharma demand is still there because these are chronic disease areas and people have diabetes, heart disease still continue and they continue to buy brands they know. So I think the pharma demand is still there, and we don't cover 70 million, 60 million population in the country. Our probably customer base likely 5%, 10% of the country. So I think the pharma demand is still there. But is there an impact here? Yes, people will move in cheaper products, people drop down a level. All these things will happen. But companies who are there, been there long term, have products available regularly. And pharmaceutical licenses are still available. So we're still able to import, number one. On the consumer side, there are bits and pieces. Licenses come and there are other methodologies that there are approvals that the government is allowing to do which we are working on. A lot of our partners have local manufacturing as well, and they're looking at other methodology. I think so that will also probably come back in some sense. So as I said, Myanmar distribution has an impact and the large impact probably in the consumer health, consumer area, FMCG. And we need to see what happens. We can't tell you exactly. So far, the impact has not been bad. But going forward, how much will be impacted, we need to see. But there are licenses, there are border trade licenses being granted. There are local manufacturing licenses being made. So I think there are multiple actions that companies are working at, but they are brand owners, we are distributors. So as and when there are solutions that arise, and I think we are working on it, we believe it shall continue. Demand is an issue of income, right? And as GDP drops, income drops and the possibility of money in the pocket drops. So definitely, it's going to affect demand. And the large effect will be goods that you don't need, right? So there will be some products that it affected. Some may be less effected, some going to be more affected as -- till the demand situation changes. So there is going to be an impact. And that's why we see we have clearly said distribution is going to drop in the years to come. While our branded business, and we are only giving you a guidance on the branded business, we are not giving you guidance on the distribution business for 2023. But having said that, the impact on the bottom line is very negligible because what contributed out of the branded are -- sorry, the consumer business was very small compared to our brand and our pharma business. So we see the impact being limited at the moment, and it may be, in some ways, compensated by our growth in other markets in the branded business. So that's our view for the year or 2 years going forward. 1 or 2 years Myanmar, we are leaving it and keeping ourselves tight, preparing ourselves to stay there and be ready for changes that happen. So that's my feedback. If there's anything I missed on your question, let me know.

The gross margins.

Gross margins, yes. So on the gross margins front, we have explained in our MD&A that our normalized gross margins have been around 17%, same at a similar level what we have seen earlier. So in quarter 3, what had happened was there was a huge backlog of dollars which we had to clear. So we were able to secure dollars and make the remittances for those dollars. So as per the accounting rules, the losses arising on account of foreign exchange are recorded under the forex line. But we have been able to recover these amounts from our principles because the forex doesn't belong to Mega, it belongs to the principals. So the forex recoveries have been recorded under the revenue line, which has ultimately flown down to the gross margins. That's why gross margin is looking very high, but the corresponding cost of that is being recorded under the forex line. So net-net impact is still the same. It is only a line-wise reporting, which we have clarified in our MD&A. But overall, as we explained, we have normalized the gross margins of distribution business, and they are at very similar levels what we have seen in the -- historically for distribution business.

Pattadol from Thanachart. May I ask more about the outlook of the gross margin of the distribution business? So if I get this right, we should assume the normalized level of gross margin for distribution of around, let's say, 17% to 18% over the next year? I'm not sure if I can...

Correct. I think that's what we also guide, 17%, about that, because of the old then the model changed. So it's in the range of 17.5%, right? I think that's what we said, 17% to 18%. So you have said it correctly. I think we are saying 17.5% if I see somewhere in the MD&A or something between 17 and 18, you're absolutely correct. After the correction was done in Philippines and some countries where the model changed and then it got corrected, now it's having in that 17% or 18% range. You're right, yes, correct.

And about the Q3 results, so should we subtract -- I mean for the bottom line that we see of around THB 650 million, so should we subtract out the difference between the reported gross margin and the normalized gross margin of the distribution business out from the bottom line to see the real operation of Mega in Q3?

No, you should not because the real operational results of the company is reported in the profit after tax. What is not reported correctly is the gross margin. So if you want to look at the gross margins correctly, you should reduce that extra gross margins of the gross margin. That's why we say actually the reported gross margin is 19.5%, but the real normalized gross margin is 17.5% for the -- 17.8% for the distribution business. But the profitability and everything else is correct. It's just that because I mean, Manoj explained. So is that clear? Or do you still need clarification?

Yes. It's quite clear, but my question is that so on the reported Q3, we saw that Mega had FX loss of around, if I'm not wrong, around THB 10 million. But from what you said, it seems like the FX loss is supposed to be much weaker because you have to record the FX loss from Myanmar currency, but the fact that the FX loss was just around THB 10 million, that is because you also had the FX gain from the Thai baht.

Correct. You're right. We also get FX gain from Thai baht, yes, that's why. But you should also realize that most of the FX losses in Myanmar, which is occurring because of principals that we distribute for, don't belong to us. We recover it from the principals. So there are 2 aspects to this. One is, the cost of that forex loss, we get it recovered, but it goes into the revenue side. It's a model change that has happened. ut you're again right, because the forex losses reported in Myanmar is getting set off with the forex gains we made in Thailand or other countries. And you are right, yes.

So 2 questions, really. One is related to the branded business. If you could just help me understand like which elements within the branded business were growing the fastest and which ones were below average in terms of growth. That's the first question, please.

I don't think we declare any product-wise growth. But what I -- what we are trying to explain that in spite of COVID-related products...

Declining.

Declining, which have declined. We are not at the same level, let's put it the other way. It's not what it used to be. If you looked at third quarter in 2021, there's a huge quarter, right, because COVID was at its peak, C, D, zinc. We have a lot of products. We get all treated with that factory. So they are not at that level, they have come down, but they have not yet come down to the 2019 level. But we also had Gofen and Loreze and ZIRIN and so many other products which are over the counter or what we call self meds depending on the regulation in the country. And then we have a whole pharma business in the market which has also shown growth. So overall, across the board, some things have flattened out and the others have grown. So we have seen some have declined on lower level, flatter meaning lower than they were at that period. So -- and we expected that. We are not saying that we can continue growth of 30%, 40% of vitamin C. It won't happen. A lot of people came in and went out, but it's still at a much higher level than the 2019 levels of vitamin C. So that's the guidance that we've been offering that this is going to happen. But what does it mean? When this tapers out, a lot of other products and whatnot, people are not buying, not using, not doing anything about pain, back pain, allergy, et cetera, et cetera, and all the other products are also same growth. And so has a real rebound in the hospital business, where [ hospital ] business, operations, surgeries, consumption has also gone up. So put that together, we have seen a growth in the branded business in spite of them declining, right? As part of that group, it could be 4, 5, 6 products, depending on the country, what is what. But in that range, they have seen a decline.

Okay. So would it be right to think that more like this -- the growth in third quarter '22 of the 9-month period has been more pharma and OTC as opposed to nutraceutical supplement business?

I think there's both only exclude the immunity-related products, that's all the rest have also grown. It's not just pharma. Other than immunity, let's put it that way, if you want to define that group, I mean we don't do that, but let's say, people consider them an immunity product, so I would call them immunity of COVID [indiscernible] people [indiscernible] COVID-related kind of products. So yes.

Okay. That's really helpful. And then are there any products that you've seen sort of lower demand for as kind of affordability and maybe inflation impact the consumer?

Not really. I think we have not done that. We have not -- we've always priced our product for what is right in the market, and we are not doing something just because to make it affordable and gain more share. It has to be our strategy, right? If the market -- we have products which are cheap. We have multivitamins that are very, very low price. And they are targeted that way. We have products that are targeted at the high end and they are different. So all products are not -- it doesn't depend on today that the product must go down in pricing. So there may be some areas where we may want to relook at in the market. But just to lower prices that we think we can gain share doesn't happen. And everybody -- if the market drops, everybody else will say, let me sell prices at cheapest product discounted. So I can get some share back from somebody else. So you think we are the only one, no, we are not the only one. And that's not going to change the consumer, just because it's cheap, let me buy more. Consumers in the market are going to switch brands. If there's a group of people who switch brands and go to the cheapest brand, they do it anyway. And there's a group of loyal people who buy your brand regularly because they get the right price. So trying to market your business only to the people you want to switch, then that's your strategy because the people you want to switch are much higher. But that way, if you say that, I'm sure there are much more cheaper vitamin Cs in Thailand than Mega. So everybody should go to them because they're the cheapest.

Okay. So I mean you'd say that basically the products that you're selling, the demand is not that sensitive to any price changes.

I mean there are price changes, but they are not being designed only for this reason. They are strategically designed. I want to stay with that price. Sometimes we want to gain share. Sometimes, we also want to make sure that the impact on the end price is much lower because the cost in the local market has not gone up that high. Even though the currency has gone up, our salaries, our advertising, our expenses are in the local currency. So I think we price the product based on the potential where we are targeting. Pricing is a very big part of the strategy. Is not only based on, today, I'm losing share so let me drop my market price and I can gain more share. And that is not a very -- it's not always correlated. It's not one-to-one, right? At least that is not what we have seen in the market.

Okay. That's helpful. The second question is just related to branded margins. And I know these have been quite high. This year, they've been very high. But just curious, like I think there was a little bit of a drop in the third quarter '22, not a big drop, but just wanted to understand what your outlook is for those margins like over the next year or 2.

I think we only give a guidance of 62% to 65%. Some changes happen because of exchange, onetime material costs that we are carrying forward, we have acquired early, or sometimes, it is also the product mix. In that period, we are doing some very high-end pharma products where we have a higher margin, then the margins will look a little bit different. But overall, I think it will remain between 63% and 65%, right? I doubt we'll guide anything above that, that anything above that.

Okay. And then the last question, sorry, is just on the FX impact. Like what would be the -- if we look at the revenue growth in brands and what would be the impact of Thai baht depreciation on those numbers?

Thai baht depreciation, I don't know what is the number, 3%, 4%. Thai baht...

Yes. The baht impact would be 3%, 4% on the bottom line. You're talking about brand growth next year or this year?

Well, I meant this year, but also next year as well.

Yes. I think baht, how it's going to behave is up to everybody to guess. But as of this year, I think the impact on bottom line would be to the extent of approximately 4%. That's our estimate because it's a complex thing to really put a finger on because we do certify different countries' currencies, and we also spent many of the SG&A in baht in many of the foreign countries. So it's not only just the revenue getting increase, but expenses also go up. So the net impact of all that, we think it's approximately 3% to 4%. That is our estimate as of now.

If there are no more questions, then we can...

Sir, I had one more follow-up if that's all right.

Yes. Sure.

It's just related to the goodwill on the balance sheet. And I noticed there's some mild volatility and I think it's been increasing in the last few quarters. And I just want to understand what that's related to.

What's that? Sorry, can you come again? We weren't clear.

Sure. It's just related to the goodwill on the balance sheet, which I think has been increasing over the last few quarters.

[indiscernible] have done in Indonesia, in Malaysia, all that in. So...

And compared to the last 2 periods, what we are seeing is mainly coming because of the Thai baht depreciation.

Okay. Okay. So that's just FX.

Yes, please.

There are no other questions. Thank you. Thanks for joining us today.

Thank you very much. I don't have anything to add. I think it's been -- thank you very much for all your support, belief. And in the business, in the management and what we are trying to do, I think you have to believe that it's going to -- it's a tough year. Everybody is having a tough time, but we believe we're in the right space. We're doing the right things. And the future is definitely there in the markets where we are building our brands, being a reasonable, sizable business with the pharmaceutical, consumer health and all the rest of the things that we are doing, building a brand that people love, people feel good about and use regularly and helping people to stay healthy. So our mission stays alive. We continue to build a brand that people love. So we care for your wellness is our real commitment to the world where we are in. Once again, thank you, and we hope to see you again next quarter.

Sorry. Could you make a -- sorry, I have -- sorry, just to interrupt, I have 2 questions, but I think you did not see it in the message. The first question, I would like to ask about a seasonality effect. Is there any seasonality effect? I remember that the fourth quarter should be normally high season for Mega retail, so is that true? Or is that not true?

Who is this? Can you ask him to identify?

My name is [ Anton Fong, Secon Security ].

I think [indiscernible], you are right, but seasonality is not that much. We have seen that -- we have seen Chinese New Year. We have seen Songkran. That's where we see seasonality. And then what is seasonal in us? We don't have a cold and flu product as much you like. If you go to [indiscernible] on the big brand, when the hay fever come, the business goes up. But most of our products, a lot of them are regular products. A very few -- Gofen is a pain product. Loratadine, Loreze is a -- it's not that big where is so big that allergy is down so people will not take allergy, but allergy is throughout the year. So I don't see a very large impact on our business by seasonality. COVID, if it comes down and the 3 year goes down, people don't want to build immunity, that we have already seen that drop. So I don't think there going to be any impact.

I think we are also looking at the fourth quarter. It used to be the highest quarter, traditionally. But that trend has changed now. So I think this year, fourth quarter, we would rather compare with last year's fourth quarter. We still expect to grow the brand. So we are not comparing with the first 9 months of the year. We'll be comparing it last year's last quarter, if that's what you're looking for. What's the other question?

Another one, I wanted to ask -- I have heard you target Indonesia about USD 30 million, right, on revenue in 2027. Is that too small? I'm not sure, comparing to the Indonesian population around 276 million.

When you are sitting at 0, $30 million is also big. And remember, Indonesia is not an easy market. How many people have succeeded in Indonesia? None. Most people have gone out. So you have the [indiscernible], the [indiscernible], the [indiscernible], the [indiscernible], and it's a 5, 7 company market, right? To break in there and be successful in areas and to make money, the size can be $500 million also is too small. Yes, you're right, it's huge. But we have to build a platform. We are now building a strength where we are building a consumer health care business, a pure pharma business, both, and building a good pipeline, building good capabilities, building good teams. So what we are saying is that in the next 5 years' time, we should be ready with that. And we will keep evaluating. This is a plan based on what we have in hand. But as things improve, we are not stopping there, right? We are building the model. And Indonesia is a well-served market, and we have to break in there and make ourselves successful, a profitable company doing at least $30-plus million. That's our goal. First step. Step two, $30 million has to become $100 million. So on a longer-term vision between $25 million to $30 million, we are also internally aiming to become anywhere between $70 million to $100 million. But step one is $30 million, becoming profitable. Step 2 is reaching up to $70 million to $100 million and becoming much bigger in size. And in specific area, not everything, but selecting areas where we can play and win. So that's the plan. So by '30, the plan is to get to $70 million to $100 million. By '27, the plan is to get to at least $30 million and breakeven. So I think this is a -- the 5, 7-year plan where we see that we should be a sizable market player compared to Thailand and everywhere else so Indonesia has become a sizable chunk in our business overall. That's the idea. It took us a long time, about 25 years in Thailand, so we are only saying 10 years, give us 10 years in Indonesia, not 25.

[indiscernible] normalized GPM for distribution business is 17 point -- you already answered. Okay, it's already answered.

Any other questions? Sorry if we missed the chat because it didn't come up with the chat. Apologies [indiscernible], sorry very much, sorry. I think there are not any more questions in the chat also and we don't have anybody on the line asking more questions. So please, if you have anything, you always know you always can call all of us freely. We are very happy to get back to you at any time. And once again, thank you so much.

Thank you.

See you soon. Thank you.