Redefine Properties Limited (RDF) Earnings Call Transcript & Summary

Good afternoon, everybody. Welcome to Redefine's Group Interim Results for the Half Year Ended 28 February 2021. I hope you are all well. Today, I'm going to be joined in presenting to you by Leon Kok, who's our Chief Operating Officer; as well as Ntobeko Nyawo, who is our Chief Financial Officer, and we did celebrate last week Ntobeko's 100th day with Redefine. So please be kind to him in your questions at the end. Okay. Just in terms of focusing on what matters most. When we go through the presentation this afternoon, there will be a number of emerging themes that we want to bring across, and I hope we do so. And I'll just touch on a few in terms of growing reputation, you will note, I'm sure, from the share price, which we know still got a way to go in terms of the discount to NAV relative to our peers. We have improved stakeholder confidence. ESG is an ongoing journey for us, where we are embedding ESG into all aspects of what we do, and we have committed to tangible sustainability targets as well. In terms of investing strategically, our asset platform is now starting to take shape as we had hoped. It is now becoming one that is focused and greatly simplified. We continue to expand in the logistics sector, both in Poland as well as domestically. Leon will be touching on that in due course. And then very importantly, our diversified asset platform is now positioned for sustained growth as the eventual uptick in the economy emerges in a post pandemic environment. From an optimizing capital point of view, you will note that our balance sheet risk has been greatly reduced in that we are now currently at a loan-to-value ratio of 44-odd percent, with a clear path to sub 40% into the 22 financial year. Liquidity has been bolstered as a consequence of a number of noncore asset disposals. And you'll note that our interest rates hedges have been extended at lower rates to take advantage of the current low interest rate environment. In terms of operating efficiently, you'll note that rental relief to tenants, although not in the prior comparative period is tapering, which is good news, and it's largely thanks to our government endeavors to responsibly manage the economy through the various lockdown phases. Rental reversions being negative is a feature across the board. Leon, once again, will touch on that. And having said that, we have maintained high levels of tenant retention during this period, which speaks to our ability to retain as well as attract tenants. In terms of engaging talent, we have accelerated transformation at senior executive level. Our collaboration efforts are on an ongoing basis being intensified, and we have adapted to a flexible working environment, which is more like a hybrid, if you like, going forward, which will be the model for all office dwellers in due course. Turning now to growing reputation. If you have a look at the first half outcomes, you note from an environment point of view, a lot of work has gone into lighting efficiency projects with a view to reducing our scope 2 emissions by about 1%. We have established forward-looking targets to contribute to the United Nations Sustainable Development Goals. And we have 23 new buildings to be certified for green building status as well as 17 that are in the process of being recertified. In terms of our social pillar, we have our young and upcoming staff participating in the United Nations Global Compact, Young SDG Innovator program. We have refreshed our stakeholder engagement strategy with neats and tweaks, and we'll share that with you at our next results presentation. And we've had a renewed emphasis on respecting human rights and promoting diversity as well as inclusion. In terms of governance, we are very proud that the ISS have awarded us a rating of 1 for the ESG governance quality score. That's the highest you can get. Our ethics training and ethics management plan has been developed and is being rolled out. And we've embarked upon a future strategy project to guide us into the coming years, and this strategy will be outlined once again at our next results presentation. In terms of putting our purpose at the heart of what we do, this is a work in progress in that we are, on an ongoing basis, looking at our stakeholders and who impact most on us and who do we impact most on. This is an ongoing refinement process, and we'll be sharing with you a lot more on our future engagement strategy going forward. In terms of our second half, focus for our growing reputation, we will continue to make strides in improving our stakeholder confidence. And in doing so, our share price will improve, and we will hope to be closing that discount to NAV relative to our peers. We'll continue our work on ESG in terms of entrenching it throughout our business and what we do. And we'll continue to develop our stakeholder relationships. The last point I want to make is our values are absolutely critical to us to ensure that we react appropriately between stimulus and response. In that space, to choose how we react, our values guide us, and we will, on an ongoing basis, be entrenching such values. I'm now going to hand over to Leon, who's going to take us through investing strategically, but particularly focusing on our local portfolio.

Good afternoon, everyone. Let's get into it. Our property assets under management now total ZAR 75.3 billion. That compares to ZAR 81 billion, if you can recall, at the end of August. That's reduction of roughly ZAR 6 billion was driven largely by the property asset disposals of ZAR 4 billion. Also, we've got a stronger rand now in the Feb compared to end of August, which was roughly reduced our offshore assets by ZAR 1.5 billion. And then was also an impairment of ZAR 1 billion. In terms of the rand over and above that, there's also ZAR 2.7 billion of noncore property asset disposals at an advanced stage. Just to highlight, that does not include the ZAR 2.6 billion of properties held for sale, which is disclosed further on in the supplementary information in the pack. It specifically exclude the disposal of the second leg of our Australian student accommodation. As well as the Chariot disposal. So over and above there's properties held for sale, there's ZAR 2.7 billion of noncore disposals at quite advanced stage. A big chunk of that relates to our local student accommodation, which I'll touch on in a bit. In terms of our local deployment of capital, the ZAR 5.2 billion was raised. ZAR 4 billion was used to repay debt. We've also deployed ZAR 400 million into development activities and Capex, and we've given you an indication of where that was spent. The bulk of that was for local development spend on logistics expansion. And then also we suffered that tax of ZAR 393 million. Roughly about ZAR 150 million of that was on the capital gains tax with the disposal of Leicester and the balance of that related to the tax incurred on the taxable income of 2020, which was not declared as distribution. So 84% of our property asset platform is now local. And as Andrew indicated, our repositioning of the platform is largely complete following these disposals. In terms of our local portfolio, the local portfolio is valued at just shy of ZAR 62 billion. That's a reduction of ZAR 2 billion from financial period last year. The bulk of that's related to disposals. And as I indicated, we'll touch on in a second, also certain impairments. The average value per property is at ZAR 214 million, and the number of properties has reduced over time, as you can see, to 290 properties as of the end of February. Our weighted average unexpired lease term at 3.5 years is still in healthy space, slightly shorter than what we had at August. And the weighted average lease escalations in force currently in the portfolio sits at 6.8%. We'll touch on the lease reversions in a minute. The number of tenants at 4,284 is largely reduced given those disposals. In terms of the outcomes for our local portfolio, our active portfolio, and as you know, we externally value our portfolio twice a year at financial year and as well as at the half year. It was revalued downwards by 1%. We've given an indication of the exit cap rates per sector there on the right, on the presentation. If you can see those exit cap rates are largely the same as what it was end of August. So the bulk of the movement in valuation was around income assumptions, which was slightly tapered off. Interesting to note also that we had total netting of 490,000 square meters of space, which is roughly split half-half between renewals as well as new lets. Which, in my view, is a very positive indicator. It's clearly demonstrated there is activity in the market despite all the trials and tribulations brought about by COVID. During the period, we also completed 2 new logistics developments totaled just short of ZAR 230 million. And there's an ongoing focus for us to rightsize our tenant's footprint to make sure that they continue on a sustainable footing. There's also ZAR 293 million worth of development in progress. That is a new development site at the S&J Industrial Park in Johannesburg as well as a convenience retail center called Quena Square in the West Rand. Our renewal reversions are under significant pressure, and we'll see that in the minutes in the various sectors. However, one way to mitigate against that is to make sure that you've got to evenly distributed lease maturity profile, so you can absorb that in any given period. And we're comfortable that our lease maturity profile is still in very good shape. In terms of non-core disposals for -- within the local portfolio, ZAR 1.2 billion, the bulk of that was 2 retail assets. In terms of the retail portfolio. Our retail portfolio is now valued at ZAR 24.3 billion. We had a renewal success rate of 59.8% during the period. So those are the leases that came up for renewal during the period, of which 59.8% was renewed. The gross COVID relief granted to our tenants, this includes discounts as well as deferrals, so we didn't net off the deferrals receipt against that number, was ZAR 75.4 million. We've got ZAR 56 million of redevelopments in progress. This is spending money on the existing assets to make sure they remain fit for purpose. Disposals, as I indicated, ZAR 900 million in the retail space. And our active vacancy has stayed roughly the same. We improved, in fact, from 5.6% to 5.5%. Trading density of our tenants during this period compared to last year's first 6 months was a decline of 7.4%. Clearly you can see the impact of COVID on those numbers. And we're still very pleased with that retention rate. This is the retention of our total tenant population at the beginning of the period compared to the end of the period comes to 95.6%. The renewal reversions, those are the leases that we managed to renew during the period was a negative 13.6%. However, it's important to note that, that only relates to roughly 7.1% of the total GLA within the retail portfolio. In terms of the office portfolio, the portfolio is now valued at ZAR 23 billion. We had a renewal success rate fairly low at 29.1%. COVID relief within the office sector. Again, this is a gross number, it's at ZAR 20.6 million. We've disposed of ZAR 48.4 million, which is 2 properties during the period. And there is redevelopments in progress of ZAR 31.9 million. The active vacancy, particularly in this sector, is of concern. It's sitting at 14.6%. That's an increase from the August number, 13.8%. You can see on the right, though, the sector or the category within the office sector that takes the most strain is within the secondary space. Luckily, the bulk of our portfolio is skewed towards the premium and A grade offices. We've got solar PV installed, the 3.3 or 3,294 kilowatt peaks. And our tenant retention still sits at a very healthy 95.8%. The renewal reversions at 24.5% is not a pleasant number, but again, fortunately, only relates to 5.1% of the GLA within the office sector that was renewed during this period. In terms of the industrial portfolio, our carrying value is at ZAR 12.2 billion. The renewal success rate was at 47.2% and COVID relief fairly miniscule in this portfolio at ZAR 11.3 million. Very proud with the new facility that we bought from Massmart and Brackengate. It's completed during this period. And it's a 52,600 square meter facility on a 15 year lease. Our noncore disposals amounted to ZAR 280 million. The active vacancy of 7.1% is unexpectedly high, it's up from the 4.1%. The bulk of that increase, though, is again following the restructure of the next due lease, where we similarly agreed to take back some of those buildings that was vacated by them and it was vacant. Those properties are in the process of either we're trying to let or similarly trying to dispose of. In terms of developments, quite active in this space, we developed ZAR 240 million and in progress as a further ZAR 148 million. Our tenant retention came in at 89% and the renewal reversions at a minus 4.4%. Again, this was related only to 4.5% of the total GLA. We'll now quickly just have a look at a video of our industrial portfolio. [Presentation]

No doubt, COVID is still with us. As we just said, particularly, [ with our team ] coming out of a potential third wave starting [ we're certain about professionals calling that. ] The impact of it is still felt throughout the portfolio. So the kind of things that we're looking at within our retail sector is to see how best we can accommodate and promote the online shopping within our centers. And we're exploring click and collect platforms and such like. We're also looking at tenant's mix within the malls to make sure that our balance to essential services is well-positioned. And then across all three of our sectors, the sustainability initiatives is very much top of mind to look at, in particular, water, our energy consumption, and more importantly, our waste management efforts. As far as the office is concerned, we do expect this sector to be so -- quite volatile and fluid during this time. It's not yet clear how the workforce will settle. One thing we are for certain now is that we cannot see that a 100% work-from-home office environment is sustainable. Certainly, in terms of our own experience, we have noticed that some engagement levels, particularly when we employ new people and such like is particularly challenging. So we're reasonably confident that in a post-COVID environment that we will work with a far more hybrid situation, and that's where our focus like to make sure that we are positioning the platform such while our office portfolio is such that we can accommodate the baring requests and needs from our tenants. As far as the industrial portfolio is concerned, we still have access to well-located and strategically located pockets of land. And we will certainly look to explore that on a tenant demand driven basis and also to refurbish those well-located all the warehouse units because in the current climate, most certainly, the emphasis is going to be on convenience, cost as well as access to particularly the warehousing facilities. In terms of our alternative investments, as I mentioned earlier, we're very pleased to announce that we have concluded the disposal of our local student accommodation platform. That includes our investment in Respublica Student Living, our 53.4% investment in as well as the directly held assets in Hatfield Square, Roscommon house as well as Yale Village. This transaction will amount to roughly ZAR 1.1 billion. It is still subject to the purchaser, confirming their funding, but we are very confident that this transaction will proceed. Its also subject to us advancing a ZAR 280 million loan, which is only going to be for a period of 12 months as well as an EBITDA guarantee with a maximum exposure of ZAR 50 million. In terms of our complementary assets, a big focus for us is on our solar PV rollout, and in particular, within the retail sector, we're closely following developments around that limitation of 1 megawatt per single installation and to see how best we can exploit that once that limitation is lifted. So that for us is a key focus. And then similarly, with our non GLA income for us is also a key focus area, particularly in the current climate, in forcing us to really think about things in a different way. And non GLA certainly lends itself to being creative, and definitely an area that we're closely looking to exploit. So on that note, we just want to quickly show you some video on our non GLA efforts. And thereafter, I'm going to hand over to Andrew. [Presentation]

Moving on to our international portfolio. You'll note that the carrying value at half year is ZAR 12.3 billion. EPP is sitting at ZAR 6.8 billion and our logistics platform in Poland, sitting at ZAR 2.3 billion. Those are our core investments going forward. As you'll see from the graphic at the bottom. On the right-hand side, you'll note that we are out of the U.K. We're in the process of exiting Australia as well as Africa. So our focus going forward is going to be South Africa and Poland, logistics and retail. Having a look at the see-through LTV, it's standing at 52%. And we'll be looking going forward as to how we refine our balance sheet to improve that see-through LTV in the coming periods of results. Just moving on then to some key outcomes for the period. You'll note that COVID-19 has had an impact on EPP's ability to pay dividends. It will play out in the numbers that Ntobeko will be presenting. Our development pipeline in Poland for logistics remains strong, and I'll talk a little bit about that in due course. EPP completed the acquisition of the last tranche of the M1 acquisition. It was 4 power parks that they acquired. And we realized ZAR 2.8 billion from the disposal of Leicester Street, which was our first development in the student accommodation sector in Australia. Swanson Street will settle contractually during the first half of '22. And the reason for the delay in terms of settlement is as a consequence of the Australian borders remaining closed for this calendar year to international students. We are in the process of exchanging our interest in Chariot for M1 Marki as a consequence of EPP completing the M1 portfolio acquisition from Chariot. I wanted to stress why Poland. And you will look at the bottom graph on the right-hand side, and you'll note that it is forecast that the Polish economy will bounce back in a post-COVID environment within a year as opposed to South Africa, which now could be anything from 2 years onwards. And it's important to note that the vaccination rollout in Poland currently sits at about 20% of the population that has been vaccinated, which compares to our 0.5% odd. In terms of the European logistics platform, you'll note that the value of our income producing assets, this is for 100%, not our 46.5%. So it's a EUR 422.6 million. We have the benefit of continuing operations without much disruption during the COVID period. Income-producing GLA, sits at 605,000 square meters, and that will grow by a further 173,000 square meters through ongoing development activity during this financial period in the second half, which will take us to just short of 800,000 square meters of GLA. If you have a look at the unexpired lease term, it sits at a healthy 5.3 years. And I think what is very important to note is that the Polish cities rank as one of the cheapest in Europe from a cost of warehousing. And that comprises 3 elements. It's not only the rental component, but similarly, from a labor cost point of view and electricity and diesel point of view as well. So if you have a look at it, not only does e-commerce and distribution drive expansion opportunities in the post logistics area. But similarly, the cost is very compelling, which will similarly attract a lot of activity going forward. Just in terms of capital allocation, where we want to allocate the most of our capital is in the high-yielding, from income as well as from a capital point of view. And you'll note that we have ZAR 470 million committed in the second half of this financial year, centered around European logistics, expansion through development, as well as a local retail and industrial development, which Leon did touch on earlier. In terms of the focus for the second half of this financial year, we will continue to evaluate every property assets capital growth prospects. We'll focus on opportunities to expand our income base. It will include non GLA endeavors. And very importantly, to attract and retain quality tenants, we need to remain relevant. And in doing so, create spaces for people to live, work and socialize sustainably. And it all centers around the human experience in a post-COVID environment. Moving on to optimizing capital. I'm going to hand over to Ntobeko now.

Thank you, Andrew. Good afternoon. I think I'll get straight into it. Just overall, a very decent set of results, given really a volatile macroeconomic environment as a backdrop to this result, which really is riding on the unpredictable trajectory of the pandemic. The other guys are saying it's a 1 in a 100-day event, but I think we will just check through the numbers quickly. Firstly, we're quite pleased directionally from the direction we're making on our -- on putting more strength on the balance sheet and reducing the LTV that has come out at 44.3% at half year, which was -- which is really around about a 3.6% improvement from what we last reported at the end of August 2020 financial year. If we then take -- I'll just expand a little bit more around about where we want to go with that and getting the LTV to comfortable levels. But just touching on some of the few notable outcomes in the first half is really that we've got a decent access to liquidity of ZAR 4.8 billion in our facilities as well as cash on hand. That enables us to really put a business in an environment where it can navigate in this very unprecedented times that are playing out in the global economy. Also, we did take an opportunity to really look -- if you look at where the interest rates are from a cost of debt on our balance sheet, we did take some opportunity to really do some blend and extend on some of our hedges. And our term of debt, on average, working out at 2.7 years. And which is slightly just shy of where we were at the end of last year at 3 years. We're quite comfortable that we've got all the ability then to refinance and continue to manage the balance sheet prudently through this environment. As I've alluded to earlier, just a touch on the -- where the LTV came out at 44.3%. Our work is -- we're pleased with the direction on that. But we're still committed to a very clear plan, as Andrew alluded to earlier, of where our comfortable levels is an LTV that is sub-40. And those initiatives we're committed to. We think this business will then rightsize on its asset platform on a sustainable basis on a constrained source of capital. One of the key things that I think also played out in the first half of the year is really that we remain highly cash-generative in quite a volatile environment. We're pleased with our cash-generating competence within the business with collections sitting just at 98% in the first half of the year. And in terms of covenants, we are all within the covenants in the period that we're reporting on. I think the liquidity position just continues to strengthen and remain as we continue to maintain our cash generation ability. But I think also just to touch on, we will continue to have our strategic exposure in terms of debt capital markets. You can see there's some maturities coming up in the next 12 months of ZAR 2.3 billion and a drive pricing will continue and test and see where that goes in line with balancing and blending that with our overall capital management on the balance sheet. On the dividend decision, just at the interim, that considering all the requisite solvency and liquidity levels. We -- the Board has resolved to defer its interim decision into the year-end one. But I think we are very precious about our REIT status. It's core for investment proposition. And we're looking forward into the -- we've got an intent around where we want to go with at the end of the year, divi. And subject to the requisite solvents and liquidity test will also make a call at the end of the year around that. Then if I could just touch on the numbers, you can quite clearly see the impact of COVID in the numbers, if you compare the period to the previous ones. And also the fact that in the -- in FY '19, we had a distribution from EPP, which is not in these numbers as well on top of that. But I think one important trait that is quite pleasing for us, directionally, is that if you look at our distributable income coming out at ZAR 1.4 billion, it's actually lower than the previous period. But we are pleased that the nonrecurring income, which really has been a feature in our past years, is actually reduced into a smaller contribution in the current period, which actually talks to the sustainable earnings base, our income liability, which is pleasing to note. And I think on the back of these numbers as well, I think though, to a lower extent in this previous 6 months, is our continued support, as Leon alluded to, to our tenants because that is really where the magic of our economic equation starts by having a tenant in a space that is relevant and provided by Redefine. If I just also touch on some headlines in the half that we're in. The ZAR 0.26 of this is really where we're coming out. We've also spoken about the dividend income recognized on receipt only. So that's why we don't include any dividends that we didn't receive in this period from our offshore investments. Then I think if you look at this set of metrics, one of the metrics that is starting to come up, but we're still not happy from a discount point of view. Our market cap coming up at about ZAR 25 billion, it's far much more better than the periods when we were really under hard lockdown, but we would like to see that improving as we continue with our strategic efforts to reposition and focus our business, as Andrew alluded to earlier. The headwinds. I think there's really 3 important things that I would like to touch on our headwinds. That's really around if you look at our continued support to the tenant that comes in there in terms of what is happening into the headwinds but also, I think some of the properties that we've disposed, you'll see that they'll have an effect on the pace of how much we can generate. Of course, you can see these are the tough times. But I think as we anticipate, that the fundamentals will start coming into favor, getting into the up cycle. Hopefully, this mix will change going forward for our business as well. A marginal uplift in the NAV of about ZAR 0.05. I think, really on the back of -- on the plus side, really pleased with the profit that we've generated in the first half. But also Leon touched on the property valuations outcome, which was a negative and roughly about a negative percent in the portfolio that also brought it down. So it could have been a little bit more. We would like to see that trend going forward, and then we'll continue monitoring it quite closely. And I think just in terms of the results, you can see that we'll continue to optimize and put strength in the balance sheet and look at the things in terms of positioning Redefine really in terms of where it's going. We're quite happy that it's positioned for an upside. And with that, I'd like to thank you and then hand over to Andrew.

Thank you, Ntobeko. Okay. Just moving on to engaging talent. Just touching on some key outcomes for the first half. Ntobeko, as you note, he's firmly in the seat as CFO. We are very proud of our learnership program, where we've got 53 learners during 2021 that have been rolled and this will take our total graduates, if all are successful this year, to close to 300 since 2013. I did allude earlier to the fact that we've implemented remote and flexible working policies, at the end of this month, we will relocate our head office to 155 West Street. And through switching from P grade space to A grade spots, we expect to realize significant savings as a consequence thereof. We are very proud of the fact that we have been certified for a sixth consecutive year as a top employer. And there's an ongoing focus around health, safety and well-being of all our employees, particularly on the emotional side, where we are all feeling the stresses and strains of COVID fatigue. And then lastly, we are in the process and have almost completed a total review of our remuneration framework and policies, which will necessitate a separate engagement with our remuneration chair as well as one of our non-executive directors in due course to test whether or not we have achieved what we have endeavored to do in terms of reconsidering our remuneration policies and practices. In terms of looking forward from a human capital point of view, we are encouraging all staff to move away from linear thinking and to embrace change to be adaptable and to constantly reconsider how better to conduct ourselves in all aspects of what we do. We also have embraced a flexible work and connected space. And this is all centered around boosting the human experience, and then from a cultural point of view, embedding diversity is absolutely critical to foster innovation as well as trust and transparency. So in closing, I want to mention that we believe that subdued property fundamentals will remain as well as a low growth environment into the new financial year as well. And our outlook depends not only on these factors, but to a large part, our fortunes are hedged to this, and that is the outcome of the battle between the virus and vaccines to stimulate mobility, particularly to change or restore human behavior around retail as well as office spaces. And then very importantly, our outlook also depends on how effectively economic policies are deployed to limit lasting damage from this unprecedented crisis. We hope that this afternoon, we've been able to demonstrate to you that COVID-19 has provided us with a unique opportunity to reset every aspect of what we do. And it's very important to note that the execution of our strategic priorities will position Redefine for the eventual upward cycle. Unfortunately, due to the evolving and highly uncertain environment in which we still find ourselves, we are not in a position to provide guidance on financial year 2021's distributable income per share. With that, I thank you for your intelligence for listening to us. And Ntobeko and Leon are going to join me now, where we're going to now hand over to yourselves for any questions that you may have.

I will read them in the order that they appear to me. And I'm just looking here, I see SBG Securities. Mr. Nene, is dominating the front position. He's got 2 questions. The first is which assets are excluded in like-for-like NOI calculations, do you perhaps exclude noncore assets? So Mr. Nene, I'll answer that quickly for you. When we look at like-for-like, we use a term called active and simply put active means that the assets were in for a full period on both sides for the comparable period as well as the current period. We don't exclude noncore assets in that process, unless, of course, one of them has been just sold in the current period, which then will be naturally excluded as a consequence of what I said earlier. The second question, on average, what was your discount or premium to book on the disposals on the local portfolio? I'm pleased to report that there was no discount to book for the disposals. And certainly, there wasn't any significant premium. They were essentially close to book that -- slightly better in most cases. But certainly, none sold at a huge loss other than student accommodation, which you'll know has been written down since the August year-end. The next question is from Investec from Nazeem Samsodien. And he asks, you mentioned refining the look-through LTV, what options are you considering to reduce this? This will be primarily via ELI? Or do you have plans for EPP. I would answer this as follows Nazeem, it's for both. We are still busy with our thinking. It is not yet ready for public disclosure. But we are absolutely looking at all aspects of our balance sheet to see how we can better fund from a sustainable point of view, all our assets, including our international ones. Adrian Jardine from South Alpha has asked what is the rationale for providing a vendor line of ZAR 280 million as part of the Respublica disposal. As far as you're able to disclose, were commercial banks or other lenders unwilling to provide the full funding requirement for the transaction? So Adrian, the vendor loan, as Leon would have alluded to in his presentation. On this point, it is a short term loan. It is a loan provided to the acquirers to provide them the space to inject an equity investor. As you know, you cannot 100% debt fund any asset in this environment. And for that reason, this vendor loan is going to be replaced at some point with an equity injection. Okay. So those are all the questions that I can see. I trust that we've answered everybody's questions. We look forward to the one-on-ones with all of you. And if there's anyone who is not going to be seeing us, I would suggest, please, if you do have questions, send our Investor Relations an e-mail, and we will gladly respond to any questions you may have. With that, I thank you for your time. I thank you for your confidence and supporting us, and we look forward to a post-COVID environment in due course, where we can have a very different conversation, and that is one about growing and expanding Redefine as opposed to the current situation where we've been looking at how do we rightsize our asset footprint. With that, I thank you all the best and go well. Cheers.