News Corporation (NWSA) Earnings Call Transcript & Summary

Good afternoon, everyone. Last year, we hosted Tracey Fellows and Dave Doctorow from News Corp's real estate division in a virtual format. I'm pleased this year to welcome News Corp's CFO, Susan Panuccio, here in person in Palm Beach. Susan, welcome, and good to see you in person.

Thanks, Mathew. Good to see you in person as well.

Maybe starting big picture first, Susan. Obviously, after 2 COVID affected years, in a period where your share price has appreciated quite significantly, how do you see the strategic priorities of News Corp going forward? And is it fair to say that maybe there's been a slight shift in those priorities because of the trends that you've seen during this period?

Yes, it's a good question to start with. I think we are quite fortunate in that probably 4 years ago, I guess. So before COVID, we set ourselves on a path where we had a look at our business since we separated back in 2013. And we really went through and had a look at the things that we've done well, the things we haven't done well and the things that we needed to focus on going forward. And out of that review, came a couple of things. One, it became clear to us that we needed to do bigger things. So a lot less things, bigger things and have greater focus and really focus on our execution capability, which we thought hadn't been as good as what it could have been since we've separated. And out of that, the simplification theme came about, which many people will have heard us talk about over the last couple of years. And that meant different things for different parts of the business, given we've got lots of different segments. So in digital real estate, we had acquired a company called Opcity. We didn't think that, that had been integrated as well as what it could be. And that's proven to be a really good driver during the COVID years for us and with the digital real estate market booming the way it has been over the last couple of years. So we had to get better at that and integrate that in. Within Foxtel in our subscription video services business, it was really important that we look to stabilize some of the broadcast trends, bring churn down and try and get a bit more steadiness within that revenue line. We had to launch some new OTT products to make sure we got the penetration in the marketplace. We've got 3 products out there now, a sports product and entertainment product and a recently launched news aggregation product, and we had to get a grip on the cost base. I mean there was a lot of work that we did on the cost base during that time. Within the old News and Information Services segment, which is now being repurposed into News Media. We had a lot going on in that segment, and it was really unclear to the market how to value some of the assets that were in there, particularly Dow Jones, which was sitting within there and were sort of clustered with all our other businesses. And we had some businesses in there that we needed to dispose of. News America Marketing was one of them, Unruly was another one. And so as we went through that journey of sort of uncluttering that segment, we did resegment that, and we took Dow Jones out, which helped us shine and investors shine the light on that great asset. And actually put some more pressure on the traditional news media businesses, which, of course, have been going through their own transition. And so we were lucky that we had started that journey, and we started looking at all those assets. At the same time, Robert and Rupert and Lachlan had been very, very focused on trying to extract money out of the tech companies from our platform deals. And so we managed to get those completed during the course of COVID. Some actually just before COVID, some after COVID. And all of that really has resulted in us being able to now repivot and focus on some of the M&A activity that we've been doing over the last couple of years. So when I think about what's happened and what's changed going forward, really nothing's changed strategically. We need to continue with the momentum that we've seen over the last couple of years. We need to integrate those M&A transactions that we've done. We've probably done about 5 or 6 of those over the course of the last 18 months to 2 years, and it's really important that we bid those in. And we have to maximize, particularly in our News Media businesses and Dow Jones, the opportunities that are in front of us as a consequence of those content deals. So I'd say nothing has really changed apart from continuing on that current direction.

There's a lot to unpick there in what you said, because you've actually gone segment by segment, as you say. I'll go through that in a bit. But maybe staying high level for now, you mentioned M&A. And you've probably been more active in that field than you have been historically. How should we think about your M&A strategy going forward? And also the acquisitions that you've done, how do you see them fitting with the historical portfolio?

So when we did that review and the work that we've done over the last couple of years, we were very clear and we've been clear with the market that we've got 3 core growth segments, digital real estate, Dow Jones and Book Publishing. And so the acquisitions that we've done over the past sort of 18 months to 2 years have been focused within those segments. So we did IBD, Investor's Business Daily, which sat within Dow Jones. We did Mortgage Choice, which was a mortgage broking business that sits with the REA asset. We acquired HMH, a book publishing asset sits with HarperCollins. And then, of course, lastly, we've just closed on the Opus transaction, which was a force disposition via the IHS and S&P merger. And we're hopefully about to close on the BCI-based chemicals business in Q4. We thought those businesses, particularly the latter ones base chemicals and Opus, which I think were a bit of a surprise to the market with great assets for us. My boss, Robert, has always shown an interest in commodity, sometimes a bit mystifying to me. But his view has always been that journalists are very, very good at FX and commodities. And within Dow Jones, we have a business called Professional Information Business, which holds our Newswires, Factiva, and Risk & Compliance business. And they have a huge amount of content -- valuable content within there. And so we thought that these 2 businesses that we could acquire and we hope to acquire very attractive multiples given the force dispositions, would complement that business very, very well. And we like those businesses because they're highly digital, high margin and very synergistic within that current portfolio, which will enable us to cross-sell and upsell to our customers. And HMH, the other business that we recently acquired, I mean, it is a great business. Book Publishing is -- if you can get the right blend with front list and back list, you can have very, very good businesses there. There's strong cash generators, which is what we like. We've got a team under Brian Murray, who is fantastic at integrating these businesses. And actually, it's got -- that business that we acquired has got the Tolkien rights in parts of the globe that we didn't have them. So we now have global rights to the Tolkien books and particularly the Amazon series coming up, we think that's going to be very attractive.

Maybe just going back for a second on the COVID macro theme. On the cost side, do you see post-COVID wage inflation as being a big issue? You've seen some of the supply chain issues impacting your business maybe in HarperCollins or News Media. How do you see that from the cost side?

Yes. Look, we're a junior end company. And so the businesses are at the moment, pulling together the budgets for next year for us to go through. And a pretty common theme that I'm hearing from my CFOs are all of those. So we're having supply chain issues and cost pressures in book publishing across freight and manufacturing. We saw that coming through in the Q2 numbers we've talked about. We're expecting to see that for the balance of the year. With newsprint, it's probably the main area that we would see, within News Media and Dow Jones. We probably won't see a huge impact in this financial year, given we have contracts in place in certain parts of the world, but we would certainly expect to see that hit as we sort of move through into the next financial year. And like all companies, wage and talent is a really big issue for us. We're seeing slightly elevated vacancies across the group, which is probably no surprise given the need to constantly go out and recruit talent, but we definitely are seeing wage pressure come through and it's different in different markets. We obviously operate around the globe. I think there's more pressure coming out of the U.S. than what we're seeing at this stage within Australia and the U.K., but that's not to say it's not existing everywhere.

Let's maybe go segment by segment, as you said, because there's a fair bit to unpick in each, maybe starting with Dow Jones. The business has done very well under COVID. What do you think has driven that acceleration? And how do you see that going forward?

Look, I think Dow Jones is a fantastic brand and it's a trusted brand. And particularly, at the moment with all the political and economic uncertainty, people tend to gravitate towards this trusted brand, and it is a truly global brand. So we have seen strong audience growth within Dow Jones. We've seen record profits come out of that business over the last couple of years. And that business probably more so than any of our other traditional businesses is farther -- further along the path for digital transition. So over 70% of their revenues are digital. It is a diversified business. So it's not just the traditional media brand. It's got this business that I talked about that has a Newswires and Factiva and Risk and Compliance in it. And the team under Almar and Will, who is the CEO prior to Almar, have done a lot of work looking at the subscription and the customer journey. So how do we improve retention? How do we lower churn? How do we ensure we've got the right engagement with our customers? And the team have also been focused, and they've been doing this for the last couple of years on advertising. So how do we maximize the data sets? How do we improve yield and pricing? How do we ensure we get the best propositions out there for our customers as well as focusing on margins? So there's a whole host of things that they've been focusing on for the last couple of years, and it's really come to the forefront at the moment. And within that professional information business outside of the consumer business, we've got this gem in there called Risk & Compliance, which has been growing double digits for quite some time now. It was much smaller when I first started in this role, it's grown into a much larger part of that business and that's been doing incredibly well.

Can you -- I mean, that's an interesting one because I think historically focus has been more on the consumer side. But as you say, there are a few gems in there on the professional side. Can you maybe talk to us a little bit more about the dynamics between professional and consumer and how you see that going forward?

Yes. I mean, look, I've been in this role as CFO for the last 5 years. And when I first started in this role, I think it would be fair to say that we probably focus more on the consumer side rather than the professional side. And that was probably for all the reasons everyone expect given the history of our company and our focus on journalism. And that business on the consumer side has continued to grow. We've now got 4.7 million subs across Dow Jones, 3.6 million of those are within the Wall Street Journal, a large percentage of those are digital. We still see a huge opportunity for growth within that whole consumer brand as it's evidenced by one of the acquisitions, Investor Business Daily, which sits within there. But we've got $12 million prospective customers across the U.S. who say that they would be likely or willing to buy a Dow Jones subscription. So there's plenty of customers that we can play in order to continue to push that growth. But as you said, on the professional side, we have got a gem of a business in there. Risk & compliance, particularly now given the sanctions and the increased regulations that are going on across the globe, it's what they do. You don't want to say that anyone profits of these types of things, but it helps customers navigate way through all these sanctions and regulations that are coming out now. And we do see an enormous opportunity to leverage the Factiva content. Robert again, my boss. He's always been of the view that Factiva has been an undervalued asset. We haven't maximized it to our potential. And so we'll increasingly focus on that going forward. And you can see that from the 2 acquisitions that we've done with Opus and Base Chemicals. So I would say we now look at both of those very similarly. We like to invest in both of those, and we want to drive growth via both of them.

Maybe switching to real estate. REALTOR and REA have done very well again in this period. When we spoke last year, Dave and Tracey were very vocal about not entering the iBuyer model. That has obviously played out very well for you. Do you think Zillow will be held back now in terms of ability to compete for a while? And does that then give boost to your business going forward?

Yes. Look, I think as a CFO, I'm very glad we weren't -- we stuck to our core competency, and we didn't take on that balance sheet risk in relation to iBuying. Look, we -- it's not that we don't participate in iBuying. We have a seller's marketplace. We partner with other iBuyers. Our model is all about customer choice and enabling that customer to come in whether it's via a partnership or whether it's from one of our core products. Look, I think Zillow is a strong competitor. They clearly have been caught up in getting out of iBuying and dealing with the associated challenges that they've had with that, but I see no reason why they're not going to continue to be a strong buyer. We need to focus on our core business and make sure that we continue to scale those products, continue to have product innovation within our core competencies, so we can continue to see that audience grow.

And as you talk about that, how do you see growth going forward in that segment, potentially in a real estate market that's not as strong as it has been in the past with interest rates increases and so on and so forth, how do you see the growth of that?

Yes. It's a challenging question. I think we like to take a step back and have a think about the macro environment in the first instance. And I think it is important to still remind ourselves that interest rates are at historic lows. So even though there's certainly indications that interest will move going forward, they are at historic lows. We had seen with COVID and the advent of remote working and flexible working, clearly, a big shift in how people look at homes where they want to go, obviously, in buying homes, and we've had the benefit of that over the last couple of years. And we've seen millennials come into the market. So I think there's 1.6 million more who have entered the market over the past couple of years as a consequence of COVID. And so I think the macro dynamics at a very high level are still very positive. We still see more new homes now than what we had pre-COVID. I think we've got 6.1 million homes with the sale during calendar 2021, it was up 15% versus '19, which is pre-COVID. So the macro environment notwithstanding everything that's happening at the moment, I think, is still incredibly strong, and we still believe over the medium to long term, there's significant growth within that market. But we are seeing as most real estate companies are seeing different tempos in the market as we go through lead volumes and different things. But we still think there's significant runway within the market.

Maybe stepping back a bit, how do you think about value maximization of your digital real estate portfolio? I mean, in terms of highlighting that value in the sum of the parts, which is quite substantial, how do you see that going forward?

Yes, it's frustrating. We still see a significant discount in the sum of the parts, and we still believe that the assets across our portfolio are undervalued, notwithstanding all the work we've done and we've talked about already here. Look, I think we will continue to focus on how we grow REALTOR and how we maximize the value. We have seen a rerating of that asset over the last couple of years. We've tried to give the market more information in relation to that asset, enabled for them to have a look at that. We will continue to be open to ideas as to how we can drive shareholder value and look at what we can do within those assets. But it's frustrating, it would be fair to say.

Maybe switching away from real estate and on to Book Publishing and HarperCollins. How do you see the trends there post-COVID? Like everyone else in the industry, you'll have some difficult comparisons year-on-year. So how do you see that trend going forward?

Yes. I mean -- it's another business that's done very well off the back of COVID. In Q2, we saw consumption levels, I think, about 22% higher than pre-COVID. So '22 versus '20 which actually when you think about that and you think about that industry, that's a huge uptick in that industry. I mean, historically, revenue probably ran anywhere between 3% to 5%, give or take, depending on what frontlist titles you had. And so actually to have the prolong period where consumption habits have changed, and we are seeing really, really strong revenue growth has been fantastic. But you're right. The comps are very, very difficult. We grew revenue 13% in Q2 off the back of strong double-digit growth the year before. We've got 19% growth coming up as comps for Q3, that had the Bridgerton series in last year. The Bridgerton series that's launching this year will tick over into Q4. So we use that sort of easy comp with Bridgerton coming in this year, but they are very, very difficult comps. And so on the revenue side, yes we are still seeing strong growth, but difficult comps. And then we've got the cost increases that are coming through because of those freight and manufacturing challenges that we talked about earlier.

Do you think is there more M&A on the agenda here in terms of driving growth, obviously, given the increase in consumption trends?

Well, I like book publishing businesses because they're strong cash converters. And so they always sit very well with me. Look we always keep our eye open within the book publishing space. Brian and his team have a great track record of getting these assets and integrating them and they've got hard cost synergies. And so they're easy assets to acquire, to take the cost out and to really see the benefit of those synergies as you move forward. So we'll constantly keep our eye open and see what's out there.

I promise you last question related to M&A on this then. Any perspectives from your side on the Random House, Simon and Chester process and any scope for further consolidation in the market to the extent you want to comment on that?

I think my boss probably put it best when he said that he thinks the lawyers will make a lot of money out of it. And he doesn't think that it's probably as great for the office. Look, I think we'll watch that process very carefully. We obviously are watching it very carefully. And if there's opportunities that come out of that, then we would look at them, no doubt like many other people.

Maybe switching then to the subscription video business. It feels like you've said you've made great progress there. Growth in your Binge platform has been really excellent. And if I'm not mistaken, streaming is almost the majority of your revenues now. How do you see that dynamic going forward? It's obviously been a part of the business that's not received that much focus, but you're highlighting that a lot more these days?

Well, I'd like streaming to be over half of our revenues. It's over half of our subs. Broadcast revenue, it makes up still the bulk of our revenue. Look, I think Foxtel has been through a tremendously difficult time over the last couple of years. We moved our shareholding from 50%-50% to 65%-35%. We did that probably 4.5 years ago. And at that time, the business wasn't on a great trajectory. It didn't really have any OTT products in the marketplace with any penetration at all. It was having challenges with its broadcast business, and it had to be honest a bloated cost base that needed to have some work done to it. And so we now are in a position certainly post COVID, where we have launched our sports and our entertainment products and they do make up 50%, 56% of our subscriber base now. Obviously, the ARPU that comes in from those customers are lower than the broadcast ARPU. But both of those products have over 1 million, where at the end of Q2, had over 1 million subscribers, which is great penetration for relatively new products in that marketplace. We've launched and it's just very -- it's early days, an aggregator product called Flash for News, which we've got that out into the marketplace now. And the technology that underpins those OTT platforms there's a lot of money on and a lot of time on to make sure they're state of the art and actually a great consumer experience. So that business has been through quite a transformation and they've done that at a time where they have taken the opportunity that COVID has afforded them to renegotiate some of the contracts. The sports contracts to look at other contracts that they had and rights contracts that they exited and to do some really heavy surgery on their cost base. And we've had hundreds and hundreds of heads that have left the business over the course of the last couple of years. And so when I think about that business now, we do have a lot more optionality for that business that we just didn't have quite a few years ago. And we said actually a couple of years ago that we wanted to get our head down. We wanted to focus on fixing the core dynamics of that business in order to put ourselves in a better position and I think that's what we've actually done.

You mentioned the word optionality. And I think there have been some comments recently as well about the optionality in relation to your Foxtel stake. How does that sit in your overall portfolio today and going forward?

I think my boss is the one that mentioned originally that we have optionality for it. And I think the way we think about that is that when we think about Foxtel and we think about how we can drive the best shareholder value in order to maximize shareholder value. We knew quite a few years ago, we were in a position where we thought that asset was being turned around in the manner we thought it was capable of doing so. So when we think about optionality now, we do think that we've put that in a great position for us to have a -- think about how we can best maximize shareholder value. And that's what we mean when we talk about optionality.

You mentioned the streaming side of the business. Maybe just on the linear distribution side, how have you seen churn numbers and the progression there? How do you see that going forward?

We had actually really good churn numbers in Q2. I think they're down to 13%, which are the best churn numbers that we've had in the past couple of years. The team over the last few years has done a lot of work on churn management, and they've been focusing on the high-value really important customers, high ARPU and trying to not offer as many discounts. So we had a lot of deep discounts within that broadcast space. The beauty of having these OTT propositions out there now is that they don't have to rely on these, I guess, low-value customers that they're getting on the broadcast side in order to try and show that they're getting growth from a subscription perspective. They've got some subscriber growth coming through very strongly via these new OTT products. So look, seasonality will impact on churn, just given the different sports seasons and what happens over in Australia. But at the moment and for the last couple of years, we've been very pleased with how that team has been managing churn.

You've left news media until the end, but I think there's a lot to unpick there. It's seen the largest increase in profitability, I think, in your last fiscal quarter. What can you tell us about the prospects of that business going forward? And I have some follow-up questions as well, but we'll start high level.

Can I say that I was surprised that it was the largest contributor to profitability. We haven't had that for quite some time. Look, that particular segment has been going through an intense transformation for the last 10 years, certainly since we've separated in 2013. And I think those businesses have made great inroads into the digital transformation as it pertains to the years coming out of COVID. So down in Australia, we converted a lot of the print mastheads, community mastheads into digital mastheads, which was really important. One, from a viability perspective going forward; and two, from a cost perspective. And we've also been seeing really strong growth within that business from core subscribers within their main metro mastheads. And so that's been really pleasing. The other thing that's happened within the Australian business is digital advertising has performed particularly well over the last 12 months. And print advertising surprisingly has performed very well over the last couple of quarters as well. And they've been doing a huge amount of cost work. So those businesses, as I said, have been in constant transformation, which has put us in good stead, I think, when we think about some of the supply chain issues and challenges coming forward. Those businesses are used to working through cost pressures. So we're really happy with how that business is performing now. The U.K. business is in a similar position. They were very print-heavy before we went to COVID. In fact, in Q2, the Sun, which is where I used to work many, many, many years ago. And I find it hard to even be able to say this, that digital advertising overtook print advertising for the first time in Q2. And so that's a real inflection point for that business as they're working through their transition. Again, they've done a lot of cost work. Again, they're focused on how they can maximize their digital penetration. We've had strong subs growth on The Times and The Sunday Times over there. And then we think even back here in America, The New York Post, which has been loss making for a long, long time, is now making a profit, and that's largely as a consequence of digital advertising, pushing on in the audience growth that we're seeing within that product. And then wrapping around all of that within News Media are obviously these content deals that we've done. And so that will give those teams new opportunities, not only to drive EBITDA growth via those content deals and revenue growth. But looking at different ways that they can leverage their content to produce additional revenue streams. So for instance, we're now having our journal -- some of our journalists being trained so they can do YouTube content, which is a different way to monetize it. They're also having a look at podcast. So I think -- those content companies, Google and Facebook, actually and Apple are working with us and our journalists to help us understand some of our content in a way, perhaps we didn't understand, and we're helping them understand our content in ways that they didn't understand, which is the beauty of those arrangements.

Okay. It does seem like the business is at an inflection point right now. And I think the key element of that is the deals that you mentioned right now with some of the big tech players. Can you talk a little bit more about how that works? And how do you see that going forward as well? Because it's quite unique, I think, to what you have done.

Yes. We haven't given out numbers. We've said that they're into the 9 figures. The global deals are under NDAs, which is why we can't talk about them, but they're global deals cutting across America, Australia, and the U.K. with the exception of Facebook that's not in the U.K., all the other deals cut across all those markets. They are high margin. So yes, they are content deals. And we've talked publicly about the fact that they're not just payment for content. There are other components within those deals that can help us drive further revenue depending on how we maximize those. Some of the examples that I've just said around podcasting or YouTube journalism or how we grow advertising or how we get a bit of funnel going into subscriptions, launching a dual subscription products. So there's lots of different ways that we're thinking about how we can monetize the content that we have and the subscribers that we have. And it's still relatively early days. I mean, we've got these deals done sort of over the course of the last 12 months. And the businesses are really working with the tech platforms in a whole manner of different ways in order to maximize those values. But you're right, they are pretty game changing for the News Media segment.

And how do you see -- I mean, there's been some concern on the digital advertising front in terms of some of the changes that Apple and Google, for example, have been bringing forward on their privacy settings, third-party cookies and so on and so forth. It seems that your business is insulated in a way from that? Is that fair? Or how do you see that?

Well, given what's happened to advertising over the years, I'm not sure we'd say we're insulated. But I think we have had a very good run with digital advertising of late. And part of that is because we've had really strong audience growth across these mastheads. Part of it is because we're seeing really strong yields coming through. But like I think most businesses that are in this space, we are working in the background to understand the impact of the cookieless world, where having to think about how some of these cases, antitrust cases that are being bought against the tech platforms over here may impact us going forward. And so look, we're pleased, and we've been having really good growth over the last couple of years, but that certainly wasn't the case prior to that.

Maybe one final question on the advertising market. What are you seeing currently? I mean there's obviously a little bit of macro volatility concerns around consumer sentiment and so on and so forth. How do you see the advertising markets holding up?

Yes. Look, for us, I'd say we haven't seen -- or certainly didn't in Q2 and nor in January. We didn't see a huge impact on advertising as a consequence of some of these macro conditions that are out there. What I would say though with advertising is it's really difficult for visibility going forward. So it's hard for us to accurately forecast going out. We've had a great run with advertising. That's really helped with some of the profitability for our business. But as far as visibility going forward, it is pretty shortsighted. But we hope to build on the momentum that we've had, but we'll have to wait and see.

I'll maybe pause for a second to see if there are any questions in the room before I continue.

The structure you have where you own over 60% of REA and then you own 80% of Move, and REA owns 20% of Move is something you really don't see in public companies very often. And over time, does it make sense for Move to be merged in with REA, just to have one entity?

Yes. Look, we get a lot of questions around our digital real estate structure and the structure of the business. And it goes to the heart of the question earlier about the sort of trapped value, I guess, that we would say -- we would see within the business. We have tried over the past couple of years to be doing different things with the structure of our business, resegmenting, giving out more metrics so we can start to shine a light on some of those assets. It's not as easy as it sounds to think about structural separation, there's tax implications, there's other things that we have to consider. All I can say on that is that there are many, many different options available, and we do consider a lot of those options, and we have a lot of feedback from investors about what they may be.

Just qualitatively can they actually be put together, does it make sense if they're together?

Well, they can operate separately or they could operate, obviously together. The REALTOR being part of REA, I'm not sure it's any different to REALTOR sort of being within our group and being held in the structure that it's held in at the moment. The markets are different. So the Australian market is very different to the U.S. market and different to the other markets around the globe. We also have assets in India, which we look at from a digital real estate perspective. So it is a good question, and we are incredibly frustrated about the disconnecting the value that we see within our share price and within these assets. And all I can say is that we continually look at things that we can do in order to unlock that value.

Any other questions? Maybe then just continuing on capital structure, maybe for a second. You did a high-yield offering recently, which appears well timed given the state of the markets. You also have a $1 billion buyback program. What's your view on capital allocation going forward?

Yes. Look, we do like to keep a strong balance sheet and a conservative balance sheet. And look, we're in a fortunate position, given how the results have traded over the last couple of years and the work that we've done over the last couple of years. That we're in a position now where we can continue to invest within the business and return some capital back to the shareholders. So we've got a $1 billion buyback in place at the moment. That's been in place for the last couple of quarters. We've been actively buying back stock during that period of time. So I would say we try and take a relatively measured approach. Probably pre-COVID, whilst we did have a buyback mandate in place, we really hadn't bought back a lot of the shares. But we weren't really in a position to do that whilst we had a lot of cash on the balance sheet. We weren't generating a lot of free cash flow. So where we are now is we're generating much healthier free cash flow. We still have a strong balance sheet, and the businesses are performing well, which is sort of enabling us to do both.

Thank you. Any concluding remarks, Susan, from your side?

Look, I think it's been an incredibly challenging time, which I'm sure you'll hear from most of the speakers who have come here over the last couple of years. And our businesses have held up really, really well. I think that's got a lot to do with the culture of the firm. We've got in excess of 25,000 employees around the globe. A lot of those people have been with us for a long period of time. And they've worked really, really hard throughout this crisis in order to focus these businesses and put them on the right footing. And so I would hope that coming out of this crisis, notwithstanding all those macroeconomic concerns that we all have, that the businesses are in really good shape to go forward. And I think we'll watch the inflation, we'll watch the supply chain pressures. We'll continue to take a measured approach as to how we invest in the business and balance margins going forward. But I think we're never complacent. I think we're in a good position to build on that moving forward.

As you say, the performance so far shows that you've got various growth levers going forward. So with that, we'll end, and I thank you for joining us again. Thank you.

Thanks, Mathew.