SAF-Holland SE (SFQ) Earnings Call Transcript & Summary

Good morning, ladies and gentlemen, and welcome to the SAF-HOLLAND SE conference call regarding the full year 2020 results. [Operator Instructions] Let me now turn the floor over to your host, Michael Schickling.

Yes. Good morning, and welcome to the annual analyst and investors conference call of SAF-HOLLAND. I'm Michael Schickling, Head of Investor Relations. This morning, we have published our annual report with the audited financial figures for fiscal year 2020 as well as the presentation slides used in this call. Your host today will be Alexander Geis, our CEO; and Inka Koljonen, our CFO. We will start with the presentation, which will focus on the strategic and financial achievements in 2020 and the outlook for 2021, followed by a Q&A session. I now would like to hand over the microphone to our CEO, Alexander Geis.

Thank you, Michael. Dear ladies and gentlemen, a warm and healthy welcome to our today's publication of our 2020 figures. This is Alexander Geis speaking, and I do hope that everybody is healthy. Before we get started, please allow me to share some insights into our 2020. As everybody knows, 2020 was dominated by COVID globally, and this was also for the SAF-HOLLAND family very challenging. I am personally very proud of our employees and their team spirit and how all of them helped to maneuver through that storm. In 2020, we continued doing our homework and paved the way for our future success. Now let's get started with a summary of 2020, please. Our sales came in with EUR 960 million and those in line with our guidance. With an adjusted EBIT of 6.1%, we came in a bit higher than our guidance of 5% to 6%. Despite the crisis, we invested further into automatization and had a CapEx ratio of 2.5% in 2020. Due to our dedicated Cash-is-King efforts, our net working capital ratio improved to 11.9%, which also was an important cornerstone to achieve an operating free cash flow of EUR 114 million. And Inka will speak about that in details later on. On the next page, we're going to share some more insights in what we did in 2020 and why this is the start of a success story. Next page, please. Starting on the left side, I want to highlight again the resilience of our business model. We are not automotive. We are in the commercial vehicles business with a high aftermarket share and a huge installed base, especially in Europe and North America. Due to a lower OE share in 2020, our aftermarket share went up from normally roughly 25%, up to then 30% in 2020, which helps to come in with a 6.1% adjusted EBIT margin, as mentioned before. Secondly, we already started our U.S. restructuring program and the SG&A rightsizing globally in 2019. This pays off now. The supplemental collective agreements in all German plants helped to stay competitive for many years now. Salary cuts and short time work also helped our profitability short-term in 2020. In terms of our financial discipline, I have to say that this was a big, big success story. Lastly, speaking of our continued strategy execution, I can tell you that we further rolled out our operational excellence system to become even more efficient. That we ramped up our China facility now. And that we closed unprofitable locations in all regions. And that we further increased our focus on our aftermarket business. Inka, you want to add something?

Not at this point. Thank you.

All right. Then let's move to the next page. On this page, we can see the quarterly performance of the group. Upper left, starting with sales, a decline of 25% from EUR 1.284 billion in 2019 to now EUR 960 million in 2020. You can see that with EUR 193 million in Q2, we clearly bottomed followed by an okay Q3, in my point of view, and a stronger Q4 with EUR 251 million. On the lower left side, speaking of our adjusted EBIT results, with 6.2% in 2019 and 6.1% in 2020, no big difference. Also here, we bottomed in Q2 with a low 2.7%. Then with a 6.4% in Q3, you can already see our measurements kicking in, followed by a strong 8.1% adjusted EBIT margin in Q4. Worthwhile to mention that in our adjusted EBIT margins are also EUR 8.9 million inventory write-downs included, but also EUR 12 million will not be sustainable because this was due to short time work and salary cuts. And how the different regions performed you can see on the next page, but maybe Inka, you would like to add something here?

Yes. Thank you, Alex. So from my point of view, maybe at this point of time, I would like to point out to the strongly improved quality of earnings. If we look at the overall adjustments. In 2019, the adjustments were at EUR 45 million. So that was the difference between the adjusted and the reported EBIT. In 2020, this number came down to EUR 28 million. And for 2021, we are looking at a number between EUR 15 million and EUR 20 million, of which EUR 10 million relates to PPA, depreciation and the remaining part to real restructuring. So we see here a strong improvement of quality of earnings with the adjustments going down.

Thanks, Inka. Now having spoken about the group, let's take a look into our different regions, 3 of them, starting with the EMEA region. EMEA came in with EUR 553 million in 2020 versus a EUR 626 million in 2019, which is only a decline of 12%. We did outgrow the market by further increasing our excellent market share, and I will come back to this later on. A 9.5% adjusted EBIT margin in 2020 was close to the 9.6% the year before. Q1, you can see with 9.4%, pretty stable. Q2, where we bottomed with 6%. And given the circumstances, still a good result. Then starting with a 10% margin in Q3, followed by a strong 11.8% margin in Q4, we clearly can trust our success in the EMEA region. In those results, 6.2% are not sustainable, but also do include EUR 3.2 million inventory write-downs. Americas, we can see on the next page, with a massive decline of 38%, which was in line with the overall decline. For us from EUR 534 million in 2019 to a EUR 332 million in 2020, this region got hit very hard by COVID. In Q2, sales halved compared to 2019, followed by a slow recovery in Q3 and in Q4. Despite this sharp decline in sales, the team managed to still achieve a 4.1% adjusted EBIT margin in 2020. Also here, we clearly bottomed in Q2, as you can see. And then our structural measurements helped to achieve a 5.6% margin in quarter 3, followed by a strong sustainable 5.7% margin in Q4. Those numbers do include 5.8% non-sustainable savings and $4.9 million inventory write-offs. So pretty much a balance. Worthwhile to mention also that we further invested in new products, such as a better air disc brake axle. And most importantly, a new ductile fifth wheel to tackle the standard market in the truck segment. The Americas region is our biggest potential by far. And last but not least, APAC region, on the next page, please. Our APAC sales came in with EUR 74 million, which is a decline of nearly 40%. And with an adjusted EBIT margin of a negative 9.9%, I am not happy at all. But in absolute numbers, this is a negative EUR 7.3 million versus a negative EUR 9.5 million the year before. We now finished consolidating our facilities and branches in China and are ready for a new start now. APAC without China was still positive for us. And at this point of time, in late March 2021, I can already say that especially India is booming and SAF-HOLLAND with an excellent market share of approximately 60% is heavily participating. That's a good thing. And I pause here for a moment and hand over to Inka.

Yes. Thank you, Alex. So let's move then to the investments. Alex mentioned already the financial discipline in his introduction. On this page here, we see the long-term development of our CapEx both in absolute and relative terms. And you will see that we are investing significant amounts here year by year. In average, we are talking about a number of about 2.5% of sales in a normal year. If we look at 2018 and 2019, these were clearly peak years regarding investments. We invested heavily, especially into a state-of-the-art facility in China, but also in EMEA. For 2020 and the guidance for 2021, we are back to a level of approximately 2.5%. But of course, with higher sales in 2021, this will also be a higher number in absolute terms. So as mentioned in the past, we have invested heavily in APAC and EMEA. This year, still focused in EMEA. But going forward, we are clearly also going to invest in Americas, in U.S.A., because, as Alex mentioned, this is one of the highest levers really to increase the value of the company. Investments in R&D remained stable at some 2% of sales. About 1/3 of that is invested into megatrends around digitalization, automatization and autonomous driving. Then to the net working capital. Yes, so next to the disciplined investment management, the net working capital was the second main driver for our very good cash flow performance. So here also, we see the long-term development, both in absolute and relative terms. And you see that in 2020, we had a significant improvement of the net working capital ratio. So coming down from 14% in 2019 to a level of 11.9%, huge improvement. Main driver was the Cash-is-King program with the goal of reduction of overdues and inventories. It was a huge step in my perspective to establishing a cash culture in the company. We have been previously mainly driven by sales and margin growth or steered by that, and we have managed for a huge action to establish really cash as the third KPI and also to install awareness of the importance of cash by focusing, by communicating and by having also a bonus-relevant target for this KPI. On the next page, you will see a very simple illustration of the main drivers and how we look at it. So again, coming from an EBITDA, and I always compare the operating cash flow to the EBITDA because I say, let's look at what we will be able to convert from EBITDA to operating cash flow and what goes stuck in the net working capital. Here, we see the opposite effect that due to the huge activities in the Cash-is-King program and the focus areas, we have managed to create cash inflows from net working capital of EUR 49 million, clearly the main driver. Yes. And then if we set the operating cash flow in relation to EBITDA, this I referred to as the cash conversion both internally and externally going forward. Then we see here really an exceptional result of the cash conversion of 148%. And I say this is exceptional because, clearly, in 2021, we will need in a growth environment also to invest into inventories, specifically. On the next page, you will see the historical development of the cash conversion rate. Of course, something I looked at. And it's between 62% and 177%, so quite lumpy. And goal is now going forward to focus more transparency on drivers, forecasting and internal target to get a long-term harmonized and ongoing strong cash performance and the cash culture. And again, be aware, 2021, the exceptionally good results will not be repeated. Then we move to the balance sheet structure and the leverage. So I think it's obvious that with our financial discipline and the strong cash generation, our net debt position has improved significantly in 2020. Leverage has come down from peak levels of about 4.4x EBITDA in Q2 2020 to 2.4x at year-end 2020. And within that, we are in the target range of 2 to 3x EBITDA. This is where we want to be. I think with this, we have improved the balance sheet structure and also improved our financial headroom. It provides us flexibility. Nevertheless, focus going forward will be to further improve and enhance the balance sheet structure and invest mainly into organic growth of the company. Yes. And with that, I would like to hand back to Alex for the strategic goals for 2021.

Thank you, Inka. Ladies and gentlemen, a high-quality growth is our strategic focus also in 2021. We promise you to manage a profitable growth in a still uncertain environment, and our material availability is secured to even deal with further increasing demands, and I will come back to this later on. We manage raw material price increases quite well at the moment. And already initiated sales price adjustments in all regions. And speaking of market positions, new product releases secure and further increase our market positions in the main markets. In EMEA, for example, we have an excellent position with an increasing axle market share. And on the truck fifth wheel side, we are #2 in Europe with approximately 30% market share. In Americas, a huge restructuring program in the last 2 years helped to gain back customer confidence. We are the clear #1 leader in fifth wheels and #1 in air display axles in North America and especially with an increasing air disc share to come in the future, this is a huge potential for us. APAC, India, checkmark. Australia for us, checkmark, as New Zealand is. And also Far East Asia, also a checkmark in my point of view. Only now SAF-HOLLAND China has delivered. In 2020, we increased our efforts in new technologies and business models. For example, product improvements for the total cost of ownership, which is very important for our customers, such as our smart axles. We have a strong focus on digitization, electrification and autonomous driving. And our new electric-driven axle systems are already delivered to major key customers for trials. And we invest in new digital business models with, for instance, subscription fees. Last but not least, on the right side, we are driving our ESG excellence by further improving our corporate governance, enhancing our sustainability efforts and increasing the percentage of female leaders. Having spoken about that and how we see the markets in 2021, we can see on the following page please. Starting on the left side with Europe, you can see truck, plus 15%, trailer, plus 16%. And I can already report that our order intake year-to-date is higher than it was in 2018, and surprisingly, even higher than in 2008. March 1, in our biggest axle plant, we went from a 2-shift to a 3-shift operation. And the second axle plant goes from 2 to 3 shifts in mid-April, so does our Turkish plant. The output is extremely good. Our fifth wheel production is fully booked, and our aftermarket business is booming. I am very happy with our start into 2021 in EMEA. Speaking of North America, truck, plus 41%, trailer, plus 32%. This is a very bullish market at the moment. And also here, we already ramped up our productions. Brazil, truck, plus 30%, trailer, plus 6%. And our subsidiary, KLL, manufacturers of bus and truck suspensions and axles, and is also fully booked with a great performance year-to-date. Speaking of China, truck, minus 15% to minus 20%, trailer, minus 5% to a minus 10%. And here, we are focusing on air disc brake and air suspensions due to the new regulations which kicked in, in 2019 and 2020 for dangerous goods transporters. Last but not least, on the right side, speaking of India, truck, plus 30% and trailer, plus 40%. I like those numbers. And with -- this is going with an upside potential in air suspensions due to new legislations also. And what does that mean in terms of our 2021 guidance? You can see on the next page, please. We are guiding as follows for 2021, and this is given the COVID circumstances at the moment. Sales to be between EUR 1.050 billion and EUR 1.150 billion. Adjusted EBIT to be around 7% of sales and the CapEx ratio, as Inka mentioned before, also to be around 2.5% of sales. We now go to the next page, please. We can see what are the key takeaways are in our point of view. We showed a proven margin and cash flow performance during the pandemic. We have a resilient and high aftermarket share with a huge population, specifically in Europe and North America, and we are best positioned for recovery with leaner structures now and an improved product portfolio. We are benefiting from an upswing in Europe, North America, Brazil and India based on leading market positions there. And we assure a disciplined approach to manage demand and working capital investments in a recovery cycle. Ladies and gentlemen, thanks for listening to us. And I think we are open for questions now. Thank you.

[Operator Instructions] And the first question comes from Mr. Nicolai Kempf.

It's Nicolai Kempf here from Deutsche Bank. You already mentioned that you will aim for profitable growth. And given this very high demand you just stated, which is obviously very helpful, I'm just a bit concerned that you will also translate this into earnings given that it could even lead to a shift and kind of big end work or air freight, which is typically more expensive. So can you just confirm that you are able to translate this higher sales also on higher earnings?

Yes. Nicolai, this is Alex speaking. Thanks for the question. This is a very valid one. Well, in previous years, we focused, in my point of view, much -- too much on just the big customers. Of course, they are very important. But what we also did, we spread the risk by also supplying now heavily to medium-sized and smaller-sized customers. This, of course, comes in with a little bit better margins. And this is how we are operating now. And secondly -- and this is also due for Europe and for North America. And secondly, what we also did, we did shut down some specific product portfolios where we could not manage in the last couple of years to become profitable. So we stopped those product portfolios because we couldn't make any money. And that also leads to higher profitability.

Can you also then say that the growth in EMEA is mainly driven by the medium and smaller-sized customer or by the big customers?

Well, meanwhile, we have a really good share of medium ones and smaller ones. Basically, if you speak about the 2 really big trailer manufacturers in Europe, that Schmitz and Krone, yes, of course, they are also our customers, but the share of sales is not that much to us anymore.

Okay. Understood.

And regarding the profitable growth, if I may add, I mean, if you look at our Q4 margins, you will see that the structure of the earnings is much better. And with the growth now kicking in, we will be able also to participate from economies of scale. So it's, I think -- and looking at the numbers, this is also the case that growth going forward will be high-quality and profitable growth.

And the next question comes from Frederik Bitter.

This is Frederik Bitter of Hauck. Congratulations on the results, and I'm really excited to see you, overall, basically moving forward. Just allow me to pick your brain or question you a bit on the topic, which I'd like to understand a bit better. So if I look at the midpoint of your sales guidance, which is EUR 1.1 billion, and then just did the math a bit and thinking, okay, the incremental sales obviously and an incremental EBIT margin, that contribution margin operating leverage, however you want to call it, of about 20%. So ultimately, and then deducting the EUR 12 million in one-offs, temporary cost savings from last year, by adding the EUR 9 million or so on the inventory write-down side. So in the end at EUR 1.1 billion in sales, I end up with adjusted EBIT of about EUR 84 million, which equates to a margin of 7.6%. Now you're guiding for around 7%. But just trying to understand if it's -- if you think you're rather conservative there or any other factors we need to keep in mind with the margin might be closer to 7% and to 8%, in fact?

I would say the calculation you did and the drivers you mentioned are certainly right, but it's a complex environment with many effects. Some of them we know already. And we are having, of course, also headwinds from the raw material price impacts. Steel prices impacting us to some extent, definitely. A large part of it, we will be able to remediate by passing on to customers, but we do have headwinds. And also, if we all look at the newspapers, the situation overall is still very uncertain. We have material shortages. We have goods in transit. We have a pandemic situation, which is still not resolved. Luckily, in contrast to 1 year ago, the industrial companies are doing well in spite of the lockdown, but still a couple of uncertainties and also some headwinds and some tailwinds within this number. So I think this is -- the sale around 7% is, at the moment, our best guess.

Okay. I guess with those numbers, if I consider, obviously, certain material cost headwinds, which are not possible to end customers. So let's see where you end up really. But general thought about the 20% operating leverage, is that somewhat correct? Or would you think because of -- I mean, sales was obviously falling quite a lot in 2020, that operating leverage might be even higher now? Or is it something you would you consider sensible?

Reasonable.

Yes, so let me summarize it again what Inka just said. Given the circumstances with COVID uncertainties, we feel comfortable with the guidance of around 7% and we need to stay cautious in the present times.

No, definitely, we appreciate that. And it is rather that you list your guidance at some point during the year than the opposite. Of course, that's much appreciated. On the regions, now with a lot of the improvements -- improvement programs concluded, particularly in Asia, still ongoing, obviously, in the Americas and North America, particularly. But where do you see like sort of midterm, what kind of margin potential do you see now in the regions? And obviously, EMEA, so sort of should be double digit. But Americas and APAC are really -- will be interesting to see what kind of implicitly, what kind of margin levels you think you could achieve when the factors are really obviously in an upswing.

Well, Frederik, as you know, we are not guiding the regions. We are guiding the group. But as you know, in the past, specifically in our second biggest region and the one midterm with the highest potential, in my point of view, Americas and here, North America, I am personally not happy with a 4%, 5% or 6% margin. This has to come back to normal levels. And the normal levels were in '14, '15, around 7% to 8%. This should be our target. But as I said before, we are not guiding the different regions. But the biggest lever we have in Americas. And we are pushing that and working on this for 2 years now, and we have good signs coming in.

So I suppose in Americas should be even higher, say, between obviously, APAC and EMEA, maybe not quite double digit, but at least high single digit, I would suppose? Just doing the math overall and thinking, okay, you're seeing that product portfolio and clean it out, et cetera.

As I said, we are not guiding the different regions. But we are working towards that.

Okay. Of course. No. I understand. Sorry, for the inception here. And the last one -- the last one, Inka, please. Since you've been with the company now for a little while, and obviously, you've underlined your cash focus in the previous conversations we had as well. But what kind of working capital ratio and also cash conversion targets you have for the company? What do you think is a good metric to look at in 2021 and also in the next couple of years...

I was kind of expecting this question from you. No, okay. We are guiding sales and margin and CapEx. And as mentioned quite extensively, we are now installing cash culture and cash metrics. And at the moment, we cannot yet guide for cash flow. And the reason is simply that we are not yet there in terms of cash steering also internally. So we are building this up. We are building up the systems for the steering of cash flow. Maybe at some point of time, we will also guide for cash, but not at this point of time. Simply, we're not yet there. But I think from my presentations and from our discussions, you can see that I have an extreme focus on this topic. And believe me, I'm following up internally also on a very regular basis where we stand and what we will do here. So I cannot give you any number for this year. Simply also the start -- also from the business perspective, not only from our internal status, but also from the business perspective, the situation is quite dynamic. We are experiencing very strong growth in the beginning of the year. At the same time, with rising raw material prices, which we will see an impact in the inventories, we have topics with the freight situation around the world. So we have to react in a somehow different or situative way than maybe in a normal year. So this makes it all less forecasted for me. So at this point of the year, it's really -- it would not be wise to give even any indication regarding cash.

Okay. No, I appreciate that. That's fine. We can obviously have our thoughts on this. No, that's perfect. And the last one just popped up actually again, Volvo. I mean, obviously, you have relatively low truck exposure generally. And perhaps, obviously, Volvo was just a tiny part of that. But they were saying that they will shut down production up to 2 to 4 weeks in Q2 because of supply chain constraints, particularly on the semiconductor side. How do you think about the situation for your truck customers and obviously, for your truck business? Do you think you will be likewise impacted in Q2? Or is it something that's maybe a bit more specific on certain customers? Or how do you mitigate that?

This is a really good question. I expected that, of course. And what I did, I had a lot of calls with suppliers and also customers specifically yesterday on this. I see that as a change for us because the trailer manufacturers would be impacted only by the semiconductors for the EBS and telematics. This is not the case. They still have a very solid supply. There are 3 main EBS suppliers when we speak about Europe now. This is the Haldex, Knorr-Bremse and the WABCO. Haldex is not in the truck business when it comes to EBS, so they are fully supplying into the trailer business. But also Knorr-Bremse, there are no supply issues at the moment in terms of EBS. So everybody is healthy. And we have some very clear collaborate trailer manufacturers in Europe. They already saw that coming and prebought a lot of EBS parts. So if we would now see our split of OE business, speaking of Volvo Europe and our business in Europe, 90%, as a friendly reminder, of our OE business is the axle business. Only 10% is truck related, so mainly fifth wheels. We don't see any drop now in fifth wheels so far, because we have -- we supply to all truck manufacturers, of course. And this could be a chance for us since if some of the truck manufacturers couldn't produce at full steam in Q2, that might cause a little release on the steel supplies and the steel prices. But to summarize at the moment, the trailer builders are not affected at the moment. We talked across Europe to about 15 of them yesterday. And everybody was still okay with the supplies of the semiconductor-related components such as EBS.

Okay. Now that is good to know. But at least, at short, I mean, I had a conference call with another company yesterday, I talked to the CFO, who is indicating that there might be a bit of an H2 topic because of stock levels, et cetera. But it remains to be seen maybe those supply constraints will ease somewhat going forward, hopefully.

And the next question comes from Mr. Philippe Lorrain.

Philippe Lorrain here from Berenberg. I just wanted to bounce back a little bit on Fred's question on the production. So if I take your outlook for the production rates for trucks and trailers, is this exactly the number that you're using to back your guidance? Or is your guidance based more like on the backlog situation that you observed in your own company and probably also like a bit of a margin of safety versus this overall market forecast?

Philippe, thanks for the question. Well, if you see the difference, what we think how the markets will develop in 2021, it's not exactly what we see at the moment when we talk about the order income, specifically in Europe, as I mentioned before. This is higher than 2018 and even in 2008. If this would be running all 2021, then our outlook for the market, specifically Europe for 2021 wouldn't be accurate, that should be higher then. But at the moment, we see the, let's say, the guidance and the order intake from all our customers coming in, and this is why -- and under consideration of the circumstances at the moment. And as I said before, we remain cautious. And all this together led to our guidance of somewhere around EUR 1.050 billion to EUR 1.150 billion.

Okay. I understand that. And just also to bounce back like on this comment that you made, like on the fact that you exposed 90% to trailer axles. Was it just for the European business or...

This is for Europe. This is for European business. So roughly 90% OE, okay? OE is actually related -- or trailer-related because we also sell kingpins and landing axle, all trailer-related. It's roughly 90%. So then the other 10% is mainly fifth wheels, truck-related for Europe. If we speak about the Americas or North America -- let's speak North America, it's about 50-50. So 50% is trailer-related, axles, suspensions. Mechanical expansions, we have 70% market share, we are the market leader, kingpins, couplers. And the other 50% of the OE business is truck-related here, fifth wheels, but also truck suspensions. If you speak about South America and mainly Brazil, very much dominated by truck and bus suspensions.

There are no more questions. [Operator Instructions] There's a question from [ Verna Freidman ]. Okay, there's a question from Mr. [Olan Kernan].

Can you hear me?

Yes.

Loud and clear.

Yes, just one question. With all your consolidation in plants, et cetera, in the last years. Do you see any meaningful restructuring costs coming in 2021 and the following years? Or with a view on the adjusted earnings, are the main adjustments then the next years only is PPA, we have to adjust?

Yes. So as I mentioned in the beginning, we are looking for 2021 at total adjustments between EUR 15 million and EUR 20 million. Of which about EUR 10 million will be PPA. Then reminder -- remainder is restructuring.

There's another question from Mr. Frederik Bitter.

Yes, just one -- sorry, just one I forgot to ask. And I didn't have -- apologies, I didn't have the time to look for the whole -- for the annual report because it's a lot of reporting going on this morning and the call being quite early. But just -- did you book a -- did you book quite some -- or how many provisions do you book like for loss of business and perhaps some product-related provisions as well in 2020, which because of the obvious upswing in the truck and trailer cycle, which you not see materializing, which might be reversed. So it's might be a bit of a technical question, that would be interesting.

Our accounting policy is in guide with all existing rules and regulations. And I would apologize, but would really not like to comment on accruals towards the outside. Maybe just in the way that as we are guiding conservatively, our accounting policy is harmonized with that, means also more on the conservative side.

There's no more questions. [Operator Instructions]

All right. If there are no more questions, then please allow me to close our call today by saying that we did a lot of homework together with the team around the globe for 2019 and 2020, and I'm very confident of our success in '21 and also the future. So we rightsized the company. We have now lean structures, the right products in the right markets. So this is a pretty good foundation for our future success. And last but not least, I would like to thank everybody for the trust in us and your investments. Thank you very much.

Thank you.