Societatea Energetica Electrica S.A. (EL) Earnings Call Transcript & Summary

Hello. I'm Alexandra Titan, Head of Investor Relations Department of Electrica. Together with the entire management team, I would like to welcome you to the presentation of Electrica's results for the final year 2020. Those of you who are connected only by phone, please download the presentation in PDF format following the link available on our website under the Investors section. [Operator Instructions] Currently, note that the entire conference is being recorded. And due to the large number of participants, the attendee's voice feature will be disabled. First of all, I will let you know about the subjects we will discuss during this presentation. We will present the financial results for 2020 and the main aspect on the impact of COVID-19 had on the group's activities, and we will discuss also about the status of group strategy implementation. Afterwards, we will have a Q&A session. I will now leave the floor to Ms. Corina Popescu, Electrica's CEO. Thank you.

Welcome, and I would like to address only some short in the beginning. We'll present the 2020 financial results and also the figures for the budget for 2021. I sit together with all my team, and we are ready to answer to all your questions. Some few words in the beginning related to the implementation of our strategy. In 2019, we define and present our strategy for the next 4 years. Today, we are -- after 2 years of this presentation of the -- we are in the middle of the period of our strategy. And I would like to present only some milestone that were happened. So the period that we passed until now with the period when we try to consolidate the existing activity group and to step in, in what we define the growth of the group, inorganic and organic growth. Last year, we finalized the legal merger of -- in the -- to our existing activity. I speak now about DSO merger and Electrica's Service segment merger. We succeeded finalize all those projects even if wasn't a very easy year. And also Electrica Furnizare transformation, the implementation was finalized in Q3 2020. Also last year, we finalized our ITC strategy, and this ITC strategy will be actually the foundation of the future development of Electrica Group. And we plan all our projet based on this strategy, which is very important in order to reach our synergy that we'll define in all our project. Why are those very important? Digitization on DSO and supply activity are 2 milestones that we can reach only if we speed up the implementation of ITC strategy. Smart metering and also the asset management, advanced asset management at the project that can be implemented and show the results only after an implementation of those strategy. Actually, 2021, I hope that will be, for Electrica Group, the year when we'll succeed to show to our investors the organic and inorganic growth. And we already inform you about our project on production and gas supply activity. Those 2 segments will be on our focus in 2021 and the implementation of strategy on those 2 segments. I hope we'll come up with complementary results in what we planned for 2021. I will kindly ask Mihai to start the presentation with the financial for 2020. And also with the figures for budget for 2021. And at the end of the presentation, we are looking to receive questions from your side, and we are ready to answer to them. Thank you very much.

Hello, everyone. I will first start with a summary of the consolidated financials. Last year, we have recorded a net profit of RON 388 million on a consolidated basis. First thing to be noted is that the result is in line with our budget. In fact, it's likely above the budget. The same holds true also for the stand-alone financial statements, where we have managed to deliver on budget given much more slightly above the budget. I think this is interesting to note also for you the evolution in the last quarter of last year. But I would start for the -- for this explanation by looking back to the numbers in the last quarter of the previous year in 2019 just to recall some one-off events. We had some changes in the collective labor agreement at that point in time, and we have eliminated some benefits for the retired persons. As a result of this elimination last year, we have a reversal in gross amount of RON 55 million, plus the net increase in the long-term employing benefits of RON 10 million. We have contributed towards a positive roughly RON 54 million effect in the last quarter of 2019. As opposed in the last quarter of 2020, we did not have any one-offs related to this area. Instead, we had an impact, increasing the provision expense by roughly RON 13 million. And I think this better explains the performance along with other factors in the last quarter. Obviously, the results of 2020, as we have also forecasted in our budget and we will further explain in each segment, including some one-off events to main event, 1 related to the supply segment and 1 related to the consolidated financials to some reversal of provisions. But I will describe them in more detail later. The same positive evolution was recorded when looking to the EBITDA evolution and also consolidated revenues. Last year, we have closed with a net debt position of RON 81 million, which is an increase of roughly RON 250 million as compared to the previous year, where we had a net cash position. And this stems from the significant investments made by the group in the distribution segment, which are supported also by additional leverage, plus the dividend payout ratio, which is actually implemented by Electrica, both at group level and at subsidiary level. Then let's try to explain briefly the EBITDA evolution, where we have recorded last year, compared to 2019, a RON 235 million increase. And obviously, this is a result of many factors, out of which the most important is the increase in the energy margin by RON 255 million. And this evolution comes from both segments. RON 61 million positive evolution comes from the distribution segment, and we have here 2 contributing factors. RON 90 million is the increase in the electricity distribution revenue, where we did have a distribution tariff increase, but that increase was offset by the negative effect of the distributed electricity quantity. We had a drop of roughly 1.4% in 2020 of those quantities as compared to 2019, whereas our budget forecasted an increase. And the drop was on the high and medium voltage levels we could see further on. Whereas on the low voltage levels, we had an increase. This accounts mostly for the household consumption. A negative impact on the energy margin stems from RON 28 million as a result in the increase of the cost of electricity purchased to cover the network losses. Mostly is a price effect as a result of the overall purchase price increases to ensure this cost element. And this was partially covered by the positive impact of the overall volume reduction of quantities necessary to cover network losses. The most significant impact on the energy margin comes from the supply segment, is RON 194 million effect depicted from this evolution. And the explanation behind is recovery of roughly RON 144 million on the regulated segment for the supply last year, which, as it is described also in the presentation in our report, is, in fact, a recovery of unrecognized cost of electricity from prior period, prior to 2020, where the recognized cost of electricity in the regulated tariff did not cover in full the actual acquisition cost for the electricity. Now moving further to other elements. We have an overall OpEx increased by only RON 28 million, and there are several contributing factors that offsets each other. The employee benefits have increased by RON 154 million. But here, I already mentioned about the evolution in the last quarter of 2020 as compared to 2019. So you should net of the RON 54 million positive evolution in 2019. Last quarter, with a RON 13 million impact in the last quarter of last year. And another -- which is the most significant variation, another significant impact on the personnel expenses stem from the redundancy cost variations. So we did have implemented, in 2020, additional voluntary leave programs. The impact of those is roughly RON 25 million, but we also had some increases in the employee -- normal employee benefits, current ones, in all segments. We should know the fact that, in the distribution segment, personnel expenses, the pass-through elements and the philosophy behind the full regulated period foresees for Electrica an increase of the personnel expenses, the regulatory values, from 1 year to another. So we have room to actually increase those benefits to the employees in order to align them to the market practice. Another maybe small element is only RON 4 million variation in maintenance and material costs. There is also a significant RON 64 million reduction of the operating expenses. Most of this decrease comes from the distribution segment in what concerns the controllable OpEx, where we have managed to achieve like roughly RON 50 million reduction. And I think that is very important for the group because it's quite sizable as compared to 2019. And we will also discuss for the budget for this year as an important assumption of the budget is that we will try to operate the distribution, the sole distribution company based on the level of controllable OpEx approved by ANRE. Then also on this OpEx overall variation, it is important to note the positive net effect of roughly RON 65 million year-over-year from the variation of the impairment adjustment for the trade and other receivables. And again, this is netting off 2 important elements. One is RON 105 million related to Oltchim. In fact, the Group, Electrica plus Electrica Furnizare, made a VAT adjustment in the third quarter of 2020. As a result of this one, we have reversed some provisions. And considering also the fact that we have implemented the VAT group in the third quarter of last year. This has had also positive effect on the cash position of the group. So that's the positive factor. And it was netted off with roughly RON 43 million variation from the recognition of additional impairment adjustment, also considering the IFRS 9 provisions and the analysis made in accordance with the standard. Some other less significant items is a one-off gain from the acquisition of our Long Bridge Management subsidiary, which is, in fact, a small photovoltaic park acquired by Electrica in the third quarter of last year. It's a positive gain of RON 7 million as a result of the bargain purchase price and it is detailed in the financial statements. And there is also a negative change in provision of roughly RON 9 million. So all in all, that's the main -- these are the main drivers behind the EBITDA evolution. And of course, also the net results for EBITDA evolution, and we also had some additional impact from the depreciation, net financing income, considering the additional leverage brought at the group level, overall decrease of interest rates for the excess cash that we had contributed to the net result reported by the group last year. Moving forward to analyze the distribution segment. Our estimated regulated asset based as of the end of last year is roughly RON 5.8 billion. As I already mentioned, the distributed quantity of energy dropped by 1.4% as compared to last year. I would say that besides what it was already mentioned for the consolidated financial statements here, we also have the decreasing overall revenues as a result of the decrease in the revenues from network construction, but these are recorded in accordance with IFRIC 12, and they had only a 3% limited impact on the margin. The other variations on the revenues already explained, together with the network losses evolution and the employee benefit expenses. Again, personnel expenses, since they are recognized in the tariff, our strategy is to be aligned with the regulatory framework in this area and noticeably enough I would mention the decrease in the operating expenses, especially the controllable operating expenses. As you can see, that segment has a net debt position. And again, is explained by the fact that we are using leverage at group level for financing the CapEx, which is in excess of the depreciation. The following slides are presenting detailed information on each DSOs, Transilvania Nord, Sud and Muntenia Nord, and you can briefly have the details. I would not insist on those ones. Starting 1st of January, we have only 1 single entity, Distributie Energie Romania. But for the rest of 3 years out of the 4 regulatory period, the tariff will be followed by each region. So that's also the basis behind the preparation of our budget for this year and also for the years to come. Out of the operational indicators, if you look back to the -- for example, to the percentage network losses, in order not to draw any misleading conclusions, I would say that these are calculated for the overall quantities. But it is important to be noticed that, on the high-voltage level, on the medium-voltage level, we had decreases on the low-voltage level, we have increases of the quantities. Regulatory targets are established ex-ante and there is also an ex-post analysis of the network losses. And the analysis is made on each voltage level. So although it appear that, in 2 cases, we have achieved below the regulatory target -- above the regulatory target, in fact, the analysis is made for each voltage level, and the impact is only limited in the case of 1 DSO only for the high-voltage level. We have managed last year to implement in full the CapEx program, which was challenging enough at the beginning of the pandemic crisis, but the degree of completion is 100.5%. So we are happy to -- that we are able to deliver the implementation of the investment as assumed. In fact, for this year, for 2021, we have assumed the targets already approved ex-ante, plus some additions of investments in order to account for the connections, which are below 2.5 kilometers, we'll discuss further on. And I think out of this indicator for the distribution, these are the most important one. Network losses, we already discussed, is higher than in 2019, overall amount RON 28 million, but in fact, is lower as compared to the budget. And this is also explained by the structural change of the distributed quantities by voltage level, by the decrease of the quantity of energy. So what concerns the budget that there is a positive contributing effect. Moving forward to this -- I mean, for Electrica Serv, which is also part of the distribution segment, I would say that the main challenge last year was to be able to deliver the plans, assuming the budget in what concerns the revenues to be derived outside the group. So from external customers, together with Electrica Furnizare for new services, and since we had 2 months of lockdown and a very difficult period, we are not able to deliver in full those ambitions. Still, we have planned for relaunch of those as assuming the 2021 budget. On the supply segment, important to note is that Electrica Furnizare continue to be market leader last year. We hold a market share of roughly 19.2%. Our market share, we have the largest number of consumption places in the customer base. Obviously, since last year, we still had regulated market, and part of our consumers were in the regulated market, part in the competitive market, and you have the details of those supplied volumes for each market segment in terms of volumes and in terms of revenues derived by each customer category and also in terms of number of customers in each category. Regarding the evolution of the EBITDA for the supply segment, there is a increase of roughly RON 126 million in 2020 compared to 2019. We already discussed about the positive margin evolution. RON 144 million is recoveries from the past, but we also had an additional positive impact on the margin. Since, in 2020, the spot market prices on the day-ahead market have recorded an overall decrease of roughly 20% as compared to 2019. So for the offtake necessary for Electrica Furnizare in order to supply our customers, we have benefited also from this positive evolution of the day-ahead market prices. This was countered by us in some regard in the last quarter of 2020 by the fact that starting September 1, the limit for the prices for the balancing market were eliminated. We even had negative prices in the balancing market and the overall increase of the prices in the balancing market has contributed over the results in the last 2 months of last year. One important element, I think it was mentioned also in our previous earnings call was the fact that for the second half of 2020, we were issued by ANRE regulated quantities through regulated contracts with producers for 99% of the need, whereas our estimate was for roughly 60%. In the first half, we had 73% covered regulated contract. So as a result, the excess quantity was rather sold to existing customers on the retail market or to new customers and the rest, which we were not able to sell in the retail market, it was sold on the wholesale market. And obviously, there is -- there was a price risk attached to that selling of the excess quantity. Another element of the evolution for the EBITDA on the supply segment was the increase in the employee benefits, RON 31 million, but this is including also a one-off effect of the redundancy cost attached to the voluntary leave programs. And there was also a negative impact generated by the receivables' impairment adjustment variation by roughly RON 38 million. The adjustment for all came in the case of Electrica Furnizare is only RON 10 million. The rest, it comes from the parent company, Electrica. Supply volumes recorded an overall increase of 0.4%. And I think this is pretty much all the details behind the supply segment to -- you will have more details for this budget when -- in the slide to come. On the liquidity and the impact of COVID crisis, I would only mention that it had only a limited impact on the group's liquidity and the recoverability of our receivables. In fact, for example, in Electrica Furnizare portfolio, there are SMEs holding the valid state of emergency certificates and outstanding balance of those customers is RON 37 million at the end of 2020, but only a proportion of those customers require the deferral of payments, roughly 2/3 of those customers, so the impact is only RON 23 million. So again, limited impact considering the size of the company and turnover and overall balance of the receivables. There are no significant changes in the evolution of the aging intervals in the collection of receivables end of 2020 as compared to mid of the year and even the end of 2019. So this evolution actually is encouraging because they did not affect significantly group's liquidity. As it is shown also in the slides, we ended this year with a gross net position in terms of cash of roughly RON 751 million, which is not so significantly below as compared to the December 2019 level. And in order to make sure that we have adequate liquidity, we have increased the availability of overdraft limits. And then, therefore, the -- if we put on top of this one the available overdraft limit, our access to liquidity is rather high. We have reduced the utilization of the bank overdrafts through the implementation of cash-pulling structure at Electrica's group level, and this can be -- had a positive impact also on the net finance costs. A few words on the budget figures. In this slide, you have the consolidated budget IFRS values. Of course, more details you have in the materials for the GMS, which are already available. And in order to explain the rationale behind our budget, I would briefly discuss about the 2 main important segments of the group. On the distribution segment, our main assumptions behind the budget is that we have constructed the budget using the regulatory values. Of course, we have made some variation in what concerns the distributed quantities because we have some excellent values, but we have considered the evolution of distributed quantities in 2020 as compared to last year. And considering our estimates for the post-COVID recovery, we had made the -- based reasonable assumptions towards the distributed electricity volumes for 2021. Tariff were already approved, so have quite certainty on this math. Our network losses were budgeted considering the percentage targets approved by ANRE. For the personnel expenses and for the occupational health and safety cost, we have budgeted based on the regulatory values and they are not subject to efficiency factors, and our target is to operate in 2020 based on those values. The thing holds true for the operating maintenance cost, budgeted using the regulatory values, but they are subject to the efficient factor. So it's very important to manage to operate within those levels. And we do hope that one of the positive effect of the merger is that it will allow Electrica to operate better by sticking with this regulatory budget, which is important for us and for the shareholders to be able to deliver the regulated return from this segment, of course, excluding the negative effect from the past corrections from the prior regulatory periods. Other assumptions, as I already touched briefly for the CapEx, which was already announced, is higher than the values approved by ANRE, being put on top some significant amount for what we estimate to be additional investment for connections under 2.5 kilometers for final customers. And it is the result of the amendments brought by the lawmaker. We will see during the year if our estimate is accurate considering the requirements from the customers. And the case maybe those might be adjusted. We -- our plan is to stick with those values. In the following slides, you do have the detailed split of the budget for each region. As explained already, tariffs are still approved for each region. So, for us, it's important to monitor the tariffs -- the performance of the segment for each region. Now moving forward to the supply segment. Probably you won't find too many numbers behind the budget, but it's important that once you exclude the one-off recoveries in 2020, this year, we will have a structural change of the market. We won't have regulated prices for the end consumers, for the producers. So we've made in the budget some assumptions regarding the transition of our customers from the universal service price segment to competitive offers. This is based on the current evolution of shifting the portfolio from the universal service to a competitive market based on our experience in the first 2 months of this year. And of course, we have made also some assumption regarding the addition of new customers in the portfolio and with -- from inbound and outbound market and also leaves of those ones, but we cannot provide too many medical details for -- in order to protect this commercial-sensitive information also from our competitors. We have decided that, in the first half of 2020, to allow to apply the discount for the clients for the universal service price. This strategy aims at allowing customers more time to design to select a competitive offer out of the Electrica's portfolios' offer. And moreover, to be more market proactive, we have extended by the end of 2021 the possibility of the customers to select any competitive offer from Electrica Furnizare portfolio and to -- not to suffer any negative consequences as a result of shifting at a later stage until August 2020 from 1 market segment to another. Of course, we apply as many times as possible retention strategies and also cross-selling opportunities because we also have, in our portfolio, besides electricity, we have natural gas sale and also services. So we hope that -- and the budget, especially for the natural gas, foresees the significant increase in the volumes, still not that sizable, but we hope to actually have those cross-selling opportunities implemented at a larger scale. So I think for the supply segment, these are the most significant factors. Of course, we will have some -- and it is included in the budget, some estimated increase in the supply cost. There are costs associated with the electricity market liberalization. Some of them are induced by ANRE regulations. We have to send notification to the customers, contract and so on. So this contribute towards an increase in those supply costs. Their marketing costs attached to this effort for liberalization and so on. Last but not least, a few words about our dividend distribution. So you saw the proposal. It's -- the gross dividend per share is RON 0.73 per share, is quite comparable in absolute amounts with the prior 3-year's period. Year-end yield is calculated based on closing price on March 4. It's 5.3%, obviously, with this explanation. Distribute -- dividend payout ratio is 85% -- 87% out of the distributable profit. Just to recall, distributable profit is a stand-alone profit less the appropriation to legal reserve, which is a mandatory distribution. So -- and this is consistent with our dividend policy, which forces for the dividend payout ratio between 65% and 100% of the distributable profit. The rest of the RON 36 million, roughly, shall be retained by the company. Obviously, this is still -- this is only the Board proposal, it's subject to the GMS decision. And in these slides, and I will not focus on those ones because these are detailed also in the report. You have the main corporate events in the last quarter of 2020. I think with this, we have reached -- we have more details in the appendices to the presentation. We have reached to the end of the presentation, Alexandra?

Thank you. [Operator Instructions] [Break]

Hello, again. Our 10 minutes are up. This is Anamaria Acristini, Chief Corporate Development Officer of Electrical, and I will be answering the questions that we've received. So the first question was the following: In the annual report, it was mentioned an ambitious internal transformation project referring to the supply segment, which aims to successfully transform and optimize the sales and customer relations activities. I would like to ask regarding the first stage, which is -- that is focused on developing the sales strategy. What exactly is the sales strategy, and what the company is planning to implement? So we've been presenting this project in the last quarterly report, and we've tried to explain how it was developed. I will try to take 1 step back. The project started in 2019. And its primary focus was exactly to turn a traditional supply company into a sales-oriented and customer-oriented company. Traditionally, Electrica was more consumer oriented than the customer oriented, and we've made all the steps necessary to become customer oriented. Actually, it was very good timing because the implementation was finalized in September, September 2020, so it was just before the liberalization. The strategy, because the question is focused on the strategy, actually, concerns the 2 key areas. One is retention of our existing customers, and how to develop our existing customer base? How to grow internally through cross-sales and reiteration activities that Mihai was talking about before? And on the other hand, also on the outbound side. And actually, we have already started opening outbound customer relation centers even this year. We have to admit that some of the outbound activities were delayed, mainly due to the pandemic. But this year, we see that the market is recovering, and we think that we are on a good track to go ahead with the strategy. Also, last but not least, we have been focusing on developing new products. And starting 2019, actually, our product offering has been -- has increased dramatically, both B2B and B2C. And through the partnership with -- between EFSA and [indiscernible] 37.54 and also EFSA with other organizations, we see that our supplier will actually become a partner of partners. So transitioning into what would be a provider of complete energy services. I hope this has answered the question. If there will be more details needed, you can always send us an e-mail on this. Okay. Next question. From the management perspective, the market liberalization, how it's going to impact the business results in the short and the long run? Aside from what Mihai has presented in the budget, there is not -- there are not many details we can give because this is rather commercially sensitive. But what we can say is that what we have seen in other countries, there is always a lag. So customers do not react immediately on the liberalization. There is a lag. And on the other hand, we have done all the efforts to make sure that our customers are informed and that they take the best decision. Of course, we'd like to retain as many as possible. So far, it's too early to tell, but I believe our budget is saying that we are striving to remain market leader. Okay. Next question. Do you consider a network for e-mobility? And can you detail about it? Difficult question, to be honest. It is in our strategy as part of the new technology pillar. However, as you have already seen, I guess, in the GMS document, our financing needs are growing, and we are looking at e-mobility, mainly from the perspective that it would be useful if it could access the Just Transition Fund or other EU funds that would allow the financing. We already have actually 5, I think, 5 charging stations, which are stored in our own locations. And we have a partnership -- actually, we're negotiating a partnership for further development. But in terms of financing, it would be key to get EU funds in this direction. Next question. How do you see the quality of consumer, i.e. a small consumer producer of electricity? I hope we understand the question correctly. We have to look -- we, as a group, we have to look at prosumers from 2 perspectives. From the distribution, of course, that it's becoming more difficult for the network because it's actually more difficult to make sure that the network can accept these new small capacities, which are installed. But from the side of the supplier of -- we don't have any problems in this direction because the energy is regulated by ANRE. However, looking at it from a strategic perspective, we don't -- we actually believe that this is the trend, and we embrace it. And we think that we are prepared to take on the prosumers. Okay. Mihai? [indiscernible].

Yes. I will take that one. So 1 additional question is, how do you explain the difference between realized and budgeted EBIT for distribution and the return on RAB. [ 3. 29% ] multiplied by the estimated RAB is roughly RON 370 million. And you are budgeting for 2021 an EBIT of RON [ 200 ] million. And the comparison between the -- I think it's between the regulatory EBIT and the accounting one would be highly welcoming news for all. Yes. Okay. Let's take the -- because there are also subsequent questions. First of all, I think we have mentioned first time 2 years ago when we have presented a budget for 2019 that we have started the first -- this fourth regulatory period with significant negative corrections from the past for the second and from the third regulatory period. And obviously, there is, from the start, the difference between the -- but this calculation, because you start from the first year with this negative balance of correction, so we'll not be able to deliver in full the regulatory rate of return that you have payback from the past. Besides the fact that there are differences between the accounting EBIT and the regulatory EBIT, this is the most important one. There also intra-period. By intra-period, I'm referring to the 4 regulatory period corrections. There is the correction for distributed quantities on 1 period -- from 1 year to another for the network losses, for the X enterprise of electricity for other cost elements, how this affects the reported accounting EBIT. But we retain the recommendation. Maybe we will considering how much we can further disclose in terms of this reconciliation in our future presentation. Another question is, how are you seeing the volumes distributed evolving in January and February? For obvious reasons, because we did not disclose yet figures for the first quarter of this year, we cannot provide detailed information. But what we can say is that, on the low-voltage level, the evolution is rather similar with last year. And we see a slight recouping of the volumes on the high- and medium-voltage levels. Another question is whether the salaries increase projected for 2021 was reflected in the revenues agreed with the regulator? I think this one is referring only to the distribution segment because only there we do have regulated tariffs. And yes, it was also mentioned in the budget rationale. Personnel expenses are budgeted based on the regulatory value so they are embedded in the tariff. And the last question is referring to the supply segment. Can you comment on what is happening on the supply segment starting this year? And how you believe that you will be impacted? Okay. Besides what it was already mentioned in the presentation, so first of all, no more regulated contracts with producers. No more regulated tariffs for the end consumers. We see already a shifting from the universal service portfolio to competitive market is more aggressive than it was in the past. Customers are stimulated to make this shift. Obviously, we see also an intensification of the competition with this market liberalization efforts, but there are not only risks attached to these liberalization process, there are also opportunities. Some opportunities related to cross-selling opportunities, selling natural gas, selling services to those customers. And again, with the data available for the first 2 months, I think we've made the most reasonable assumptions in the budget. But of course, it's a period where a lot of risk and opportunities could impact the segment. How -- and final one is timing, how much would be corrections from past period impact on the [indiscernible]? I think we have disclosed this information in the notes to the consolidated financial statement. And if you allow me one moment, I can give you the figure, too. I think it's RON 88 million, RON 88 million, yes, of this -- at December 31, 2020. And I'm referring to the outstanding balance for this period, okay? Not the ones coming from the second and third regulatory period. Thank you.

Thank you very much. Those were the questions. We have to end the presentation here. We are waiting to meet you during our next presentation. Thank you. Have a good day.