Transcontinental Inc. ($TCLA)

Welcome to the TC Transcontinental First Quarter of Fiscal Year 2026 Results Conference Call. [Operator Instructions] As a reminder, this conference is being recorded today, March 10, 2026. I would like to turn the conference over to Yan Lapointe, Senior Director, Investor Relations and Treasury. [Foreign Language] Mr. Lapointe, please go ahead.

Thank you, Joel, and good afternoon, everyone, on the call. Welcome to Transcontinental's First Quarter of Fiscal 2026 Earnings Call. Before we begin, please note that you can find on our website at www.tc.tc, our quarterly report, including financial statements and related notes as well as the slides supporting management's remarks. A replay of this conference call will also be available on our website shortly after the call. Please note that this conference call is intended for the financial community. Media are in listen-only mode and should contact Laurence Boussicault, Senior Adviser, Corporate Communications, for more information. We have with us today our Executive Chair of the Board, Isabelle Marcoux; our next Chief Executive Officer, Sam Bendavid; our President and Chief Executive Officer, Thomas Morin; and our Executive Vice President and Chief Financial Officer, Donald LeCavalier. As referenced on Slide 2, some of the financial measures discussed over the course of this conference call are non-IFRS. You can refer to the MD&A for a complete definition and reconciliation of these measures to IFRS. In addition, this conference call might also contain forward-looking statements. These statements are based on the current expectations of management and information available as of today. Forward-looking statements also involve numerous risks and uncertainties, known and unknown. The risks, uncertainties and other factors that could influence actual results are described in the fiscal 2025 annual MD&A and in the latest annual information form. With that, I would like to turn the call over to our Executive Chair of the Board, Isabelle Marcoux.

Thank you, Yan, and good afternoon, everyone. First and foremost, let me say how proud I am that we successfully completed the sale of our packaging business. Earlier today, our Board approved a special dividend of $20 per share. This delivers immediate and tangible value to our shareholders. It reflects the strength of the business we've built over the past 12 years as well as our courage to act decisively and our determination to keep building the company. With this transaction behind us, we're opening a new chapter for TC Transcontinental with a clear focus on growing our businesses of retail services and printing and educational publishing. To lead the company through this next phase, we announced earlier today senior management changes effective April 6. This transition is part of a strong succession planning process focused on continuity and growth. I'm pleased that these changes come from internal promotions of leaders we know well, and who have delivered strong results for us over many years. Before introducing our upcoming CEO, Sam Bendavid, I want to take a moment to express my deepest gratitude to Thomas Morin for the role he's played at Transcontinental. Thomas, in 2019, we were looking for a leader with deep packaging expertise to lead our sector, and we're fortunate to find you. You did such an outstanding job that 4 years later, the Board and I asked you to become CEO, bringing your leadership and operational expertise to the entire organization. You delivered in both roles, and I'm deeply grateful for everything you've done. Today, with the sale of the Packaging business, you helped build and elevate, we come full circle. You can be very proud of your accomplishments in operational and financial performance in people leadership and reinforcing our health and safety culture. On a personal note, Thomas, it's been an immense pleasure working with you every day and a true privilege to have such a great partner. I will miss you. On behalf of the Board and my family, thank you warmly and sincerely for everything. Turning now to Sam. So I hired Sam Morgan 18 years ago and have worked closely with them ever since. I can say this without hesitation, he's a man of action, focused on performance and an exceptional deal maker. I know him well, and I trust him fully. At this stage in our journey, we need a leader with the vision for growth, analytical rigor and strong execution capability. Given his drive, his track record and his experience, the Board saw in Sam the leader we need to generate profitable growth. Thomas consistently delivered results, whether in M&A, procurement, leading our coatings business or executing our recent 2-year program to increase profitability and strengthen our financial position. Sam will be supported by Pat Brayley, who will step into the newly created role of COO. Currently leading our retail services and printing activities, Pat has driven the sector's strategic repositioning. He has also led key innovation initiatives including the launch of Raddar and the deployment of artificial intelligence and the production of content for retail flyers while improving operational performance. He's the right leader to support Sam in transforming our organization with discipline and innovation. Patrick Lutzy, a respected industry leader with more than 20 years at TC, will continue to lead our educational publishing business as President of TC Media. Under his leadership, the media sector has more than doubled revenues over the past decade. He's also introduced AI to improve processes and product offerings, reinforcing our leadership in indication of publishing across print and digital. In conclusion, the Board is very pleased to promote Sam and Pat, 2 leaders, we know extremely well, and who have proven themselves time and again. These appointments reflect our ability to develop and promote strong leaders from within. This is an important and exciting moment for Transcontinental, and I look forward to working with our leadership team as we pursue our next phase of growth. Sam will now a few words before turning the call over to Thomas and Donald to discuss our Q1 results. Over to you, Sam.

Thank you for your kind words, Isabelle, and good afternoon, everyone. I strongly believe in the growth potential of our company, and I'm energized by the opportunity to turn that potential into reality. My objective is clear: through disciplined, profitable growth and targeted acquisitions as well as smart use of technology, including AI, we will build an innovative, high-performing organization, one that delivers real value to our customers across the retail, education, books and information sectors. We have a strong balance sheet, businesses with a strong competitive advantages and an outstanding team that has repeatedly proven its ability to execute. With the support of Isabelle and the Board, I'm excited and confident as I embark on this next chapter with our leadership team. I also feel very fortunate to carry forward the experience and insights, I have gained working closely with exceptional leaders such as Thomas. Thomas, thank you for all your insights, coaching and mentoring. I wish you all the best in what's to come. With that, I'll now turn it over to Thomas, and I look forward to speaking with many of you in the weeks ahead.

Thank you, Sam and thank you to Isabelle. It's really been an honor to work alongside with you Isabelle, as well as Donald and so many talented colleagues around the organization. I have a great confidence in the future of the new TC Transcontinental because of your leadership and because of the exceptional talent I have encountered at every level of the company. I also want to say that the Board has made excellent choices. Having worked closely with Sam and Pat over the years, I can attest to their talent, their high energy and their readiness to take on this important new roles. I'm convinced they will do a tremendous job, and I wish them every success. Thank you, Isabelle, again, for your wise counsel. I also thank the Marcoux family, the Board of Directors and the talented employees of TC Transcontinental for their unwavering support. Let's now turn to our Q1 continuing operating -- operations results. In the retail services and printing sector, our recent ISM acquisitions have enabled us to partially offset lower volumes in our traditional books and flyers printing activities. Profitability was also affected by price concessions. It is important to note that strategic price concessions are an important element of our toolkit to secure multiyear commitments from large customers for our traditional activity. In our media sector, we saw lower volumes, mainly attributable to the end of the contract related to the electronic tendering system. But also, let's keep in mind that this is a seasonal business as Q3 and Q4 are the important quarters to the media sector. As this is my last call with you, I must say how confident I am to pass it on to Sam, 2 solid sectors, both well advanced in their transformation and both with potential to grow. As an illustration of this, our flyers business continue to evolve. In response to a challenging flyer market dynamic, we're preparing to launch Raddar in Ontario in the next few months, providing our customers with lower costs and greater reach. This will set the stage for further deployments as we see an opportunity for Raddar to become a national advertising platform within the next 12 months. Another example is the growth of our installed marketing business. As we continue the integration of the 3 acquisitions we made in 2025 that have reinforced that geographical footprint and expanded our offering, we're expecting to close yet another ISM acquisition soon within Q2. And we maintain, of course, an active pipeline for further other opportunities. In conclusion, I'm confident in our growth plan, and I believe that the new TC has a bright future ahead. On this, I will pass it over to you, Donald.

Thank you, Thomas. It's been a real pleasure to work with you over the last 6 years, and I wish you the best. And to you, Sam, congratulations on your new role, I'm confident you'll do a great job. Moving to Slide 5 of the earnings call presentation. For the first quarter of fiscal 2026, we reported a 2.3% increase in revenues from continuing operations versus the same quarter last year. This growth comes from acquisitions in our in-store marketing activities and a positive exchange rate impact. The growth was partially offset by lower volume and price concessions in our retail services and printing sector. Regarding profitability, consolidated adjusted EBITDA declined $7.2 million or 17.9% to $33.1 million. The decline was mainly due to lower volume and price concessions in the retail services and printing sector, partially offset by recent acquisitions and favorable exchange rate. The increase in our share price also contributed to higher incentive compensation expenses. Net financial expenses decreased by $0.4 million to $9.3 million mainly due to a lower debt level following strong cash flow generation in the last 12 months. This was partially offset by lower interest income we earned last year from the proceeds of the sale of our industrial packaging activities before we declare a special dividend in April last year. Adjusted income tax decreased by $4 million to $1.5 million and represented an effective rate of 18.3%. This led to adjusted earnings per share from continuing operations of $0.08 compared to $0.10 in Q1 last year. While our results after Q1 are lower than last year, we remain confident in our outlook. We expect adjusted EBITDA to be below last year in the second quarter before recovering in the second half of the year as we start seeing the positive impact of significant cost reductions and profit improvement initiatives. Now turning to cash flow. As expected and in line with normal seasonality, we saw a negative working capital in the first quarter of 2026. At $10.8 million working capital usage, it was over much better than the $16.4 million we had in Q1 last year. Improvement was mainly due to lower inventory. Our CapEx at $11.9 million was in line with last year and on target to be around our guidance of $55 million to $60 million for the full year. Our adjusted net ratio was at 1.69x at the end of the first quarter of fiscal 2026 compared to 1.59x 3 months ago. While we expect to generate strong operating cash flows in the rest of the year, our adjusted net indebtedness ratio is expected to increase over the next 2 quarters before improving in the fourth quarter of fiscal year 2026. As for the monetization of real estate, we expect to close the sale of one building in the next few months. Our financial position is solid. The Board has approved today the return -- to return most of the proceeds from the sale of our packaging business to shareholders with a special dividend cash distribution of $20 per share. With the sale of our packaging business, we also signed a revised credit agreement with our banks, securing the funds to repay our $250 million notes that are due in July 2026. The new agreement will also provide the flexibility to pursue our growth strategy. On that note, we will now proceed with the question period.

[Foreign Language] [Operator Instructions] And your first question comes from Sean Steuart, TD Cowen.

Congratulations to Thomas, Sam and Pat. I have a couple of questions. I guess just trying to dial in on the guidance that you would expect that adjusted net debt ratios are going to increase in the next couple of quarters before starting to improve in fiscal Q4. Can you give us a better perspective on what's feeding into that expectation? And then I imagine a part of this the back-end weighted cost savings coming through later in the year. Can you give some perspective on the dollar magnitude there and expected follow-through into 2027?

Well, you're right. Actually, the cost saving not only will help on the debt-to-EBITDA ratio at the end of the quarter, but this is why also we're positive regarding maintaining EBITDA compared to last year. That's 1 thing. Second thing is we -- when we gave guidance for Q2 and Q3, we include the possible acquisition that Thomas mentioned a little bit earlier. And there's some timing and payments. And I would say lastly, the fourth quarter is always a very strong quarter for us in terms of EBITDA and free cash flow. So those are the key elements.

And you touched on an expectation that there'll be 1 property sale in the near term. Any updated thoughts on -- I believe there was at least 2 properties that you had line of sight on and maybe somewhere behind that, context on expected proceeds and timing of additional real estate sales?

Yes. The one that's closed in the pipeline and hopefully, that will close in the next few months is north of $30 million of value. So that's 1 of the big ones that we had in the pipeline. We'll see for the rest of market, it's still a market depending on the region where you are. It's -- I would say it's kind of slow and it will depend also what's going on in the current global economy, but we're confident at least to close this 1 in fiscal year and we'll see the timing for the other ones. We have 2 other ones in the pipeline also, a small one in the U.S. and one other one in the south of Montreal.

Okay. Just one last question for me. Your credit rating was downgraded yesterday. Any thoughts on how that changes your overall cost of capital perspective on, I guess, higher borrowing costs going forward?

Well, not really because the new financing, as I mentioned in my opening comments that we put in place will be based more on debt-to-EBITDA ratio, that current rating pricing will be close to the pricing we had regarding BBB- or investment grade. And as far as the investment grade for us, it's more a question that the size of the business because the balance sheet, as you can see, will be very solid. So it's more a question of the size of the business regarding the decision by the agency.

[Foreign Language] Your next question come from Nikolai Goroupitch of CIBC Capital Markets.

Could you elaborate more on the price concessions you took? How do these developments unfolded and potentially quantify the impact on revenue growth as well?

The price concession we took in the first quarter is, I would say it's north of $1 million. It's in that region. So over -- annually it's about $4 million. But this is something that when we do important renewal that we had in the past, and we always find ways in the coming quarters to -- with our synergies or efficiencies to compensate for that. But since we -- at the beginning of new contracts, it did hit us directly in the P&L for this quarter.

Okay. I see. And could you also provide some more detail on the size of the new acquisition you're expecting to close? And how do you expect the rest of the year to shape up on the M&A front?

Well, we're confident, as we said in the comments, we're pretty much advanced on discussion, but obviously, we need to close the transaction. In terms of size, we won't disclose any amount, but you can expect that it is in the area we did for this group over the last few years. So not a big one compared to what we're doing in packaging, but very important for us, and that will create a lot of good synergies on cost side and commercial side also.

[Foreign Language] Your next question comes from Adam Shine with National Bank.

Okay. So Sam, congratulations and of course, Tom, it was wonderful interacting with you, and I wish you all the best. Maybe we could just start in terms of the Q1 disclosure around ISM timing where the volumes were a little bit lighter into Q1. Can you just maybe speak to that both in terms of quantum and what was the driver of that?

Yes. Regarding ISM, that was for us in Q1. We were expecting when we disclosed at the end of fiscal year, on the retail side, because of the current condition in Ontario and the rest of Canada would be tough. But ISM, we were expecting a little bit better in this quarter, but it's mostly timing. Having said that, if you look at the impact of pure growth in the quarter. This is something we disclosed in our financial note, it's about 5% decline. But we still expect that overall in fiscal 2026, we will have positive organic growth, excluding acquisition for that group. So it's mostly because of timing of some contract renewal or some stores that delayed some of the improvement they were supposed to make in first quarter. But we're still very confident for the rest of the year.

Okay. I appreciate that. And then obviously, interesting development in regards to Raddar going into Ontario, I didn't think that was going to happen until like a year or 2 from now. So is that based on sub negotiation with Torstar that allows this to happen? Or is there something different going on?

Well, obviously, they're an important partner of us. So anything we will do in Ontario, rest of Canada will be in discussion, negotiation and collaboration with them. But regarding the timing, we say that we will do more in Ontario, the timing of where we will be doing all Ontario, rest of Canada is still not decided, but we will certainly do some tests in the coming quarter. And it's important for us to stabilize this business and Raddar is a great solution for us regarding that.

But just to be clear, if Torstar is doing flyers and distributing it in their territory for you, are you looking to offer Raddar as sort of complementary alternative solution to replace those flyers or it comes in as an alternative solution for customers to decide upon.

Well, first, we're doing -- all flyers are done by us. It's just we're talking about distribution. So what you might see in the coming months is some region might have a distribution of Raddar, but they will still like be some flyer that might be done directly by Canada Post. But what we're saying is we will do in some region in Ontario, some tests regarding raddar in coming months in Ontario, yes.

Okay. I appreciate that. And maybe given that Isabelle is on the line, just a quick question in terms of the nature of the new sort of structure, just having a COO. Is that something where we kind of look upon Patrick as pseudo President, Sam as CEO, although he does have both titles or will get both titles? Or do we look upon this as something whereby there's maybe more in play regarding COO in regards to a future transitionary dynamic? Just curious.

No, no, no. You're way ahead there. This upcoming transition, I think you should look at Sam as a very strong growth-oriented person deal maker. He's done M&A for the company for the past 18 years. And you should look at Patrick Brayley, as a true operator, innovator, knowing print so well. So a great team with both of them. I think we have 1 plus 1 is 2.5.

[Foreign Language] Your next question comes from Stephen MacLeod with BMO Capital Markets.

Thomas, congratulations on your tenure and congrats to Sam and Patrick as well. Just wanted to touch on a couple of things. Just firstly, with respect to ISM, I mean, you sort of touched upon a pending transaction or one that's in advanced discussions. I was just wondering if you can just remind us kind of the strategy with ISM M&A. Is it about filling in geographic coverage? Or is it more about broadening your customer base? Or is it a little bit of both?

Yes, it a bit of both. We also already moving in the Western Canada with our own platform on the retail side. So we're active over there. But it's adding products, but also it will be geographical. So -- and we see many opportunities in the next few years to grow that business. So yes. And expanding of -- to expand our offering to our own clients also.

Okay. Okay. That's -- sorry, go ahead.

No. I mean I was reiterating on Donald's message. It is really both the reach, geographical and the product offering at the same time.

Okay. That's helpful. And are there any -- when you think about both of those vectors, geographic and product, I mean, are there any notable geographies or products where you're underrepresented?

In terms of products, it's a very large market. So we can go in a lot of detail. We have a very good position in the product that we deliver for our main clients right now. In terms of regional, geographical, we're solid in Quebec and on value. We have some operation in Western Canada, but I think we have the right balance regarding where the business is done actually.

But we were on the -- we've acquired the businesses in Quebec to balance indeed the footprint between Ontario and Quebec. Now we create [indiscernible].

Okay. That's great. And then I just wanted to clarify, Donald, did you say that ISM was down 5% in Q1?

Yes.

Okay. Okay. Perfect. And then maybe just turning to leverage. As you think about your -- is it still fair to assume that your net debt-to-EBITDA target exiting 2026 is in that 1.6, 1.7x range.

Well, first, we don't have a target. This is something that said that when we're not doing acquisition, it was the case before. And even though the rating is not there anymore, we will remain very prudent with the balance sheet. We have a solid balance sheet and the idea is to maintain it. to give us the flexibility to do M&A. So I would say that we don't have a target, but we were -- right now, we can be in a zone to 1.70 to 2 depending on timing acquisition. But other than acquisition, we should be under 2 and going very rapidly close to 1 because this business, our business will manage a lot of free cash flow in the coming years. So if there's no acquisition, we should be in a very good position.

Okay. That's very helpful. And then maybe just finally, if you're able to give some color around it. Can you give some guidance or color on what the impact -- what the magnitude of the corporate cost savings might be in the back half of the year?

We're working on it, but it depends also on the TSA, we have with ProAmpac right now because we will work with themt. But we said over the next 2 years is to say roughly $30 million of cost of corporate. So the timing still needs to be established regarding exactly when we'll be able to do some movement. So it will be -- some of it will come in the next -- in the second half and some of it will be mostly next year for full run rate.

[Foreign Language] Your next question comes from Maher Yaghi with Scotiabank.

[Foreign Language] I just wanted to ask a question. I -- putting aside the incentive compensation cost increase, just focusing on the retail and services and printing. I was trying to figure out the drop in organic revenue of $6.7 million came with a drop of $5 million approximately on the EBITDA side, it seems pretty high. Can you just help me understand -- you mentioned earlier that pricing was about $1 million. So I was trying to figure out why the EBITDA decrease was so elevated compared to the revenue drop?

Well, yes, you're right. For sure, price concession, north of $1 million had an impact. And also where we had some decrease is in the distribution of flyers and the rest of Canada, and you know that this is very high margin for us. So that has an impact for sure also. I would say that that's the mix that didn't help us on the EBITDA side versus what we lost on the sales side.

Okay. So is that running through the P&L completely now? Or there could be like an additional step-down function in Q2 on that side?

When you said step-down function, what do you mean by -- can you repeat?

I mean the lower profitability from the lower distribution that you have in the rest of Canada, is that running through? Or are there additional geographies that will be affected in Q2 that have not been affected yet.

Well, what we said, and that's what I said in my opening comments, we remain confident for the full year to be stable versus last year, but the impact you see in the first quarter should be roughly the same in the second quarter because the cost saving program we put in place and some other actions we're taking will start to kick more in the second half of the year.

Okay. So looking back at the -- on the revenue line, you mentioned you're launching Raddar in the rest of the country. How should we think about the revenue trajectory in the second half if you're launching that process in Q2?

Yes, hard to say for the moment because we don't know at which speed the progress will come. As we said, when we have this transition for Quebec and also a little bit of BC, for sure, top line will go down. But the most important for us is to maintain the EBITDA. But it's really hard to say what will be the impact of percentage, it depends on the timing. And the reason to be clear that the top line will be affected is that we're using less paper. Therefore, it does have an impact, but the VA and the EBITDA is not affected, and we saw the impact in Quebec. So it's hard for us to say right now because it depends again at the speed the progress will go, but it will affect the top line for sure, but it will stabilize EBITDA, and this is the most important thing for that part of the business.

Yes. No, I totally get that. Maybe just if you can give us the total revenue that you currently generate that could eventually transition to Raddar for the rest of Canada, just to get an understanding of how much we're talking about.

Well, this is something that Yan can give you some more color offline.

Okay. Great. And just on the leverage side, there's a lot of wacky, I mean ratios going on now that you still haven't cycled through the P&L and you're on a pro forma basis. But let's say, a year from now, Donald, where would you like that leverage the land?

Well, again, it depends on the timing of acquisition. As Sam mentioned in his comments, we're confident to grow the business on the ISM. Therefore, we will be active on acquisition. We have a business that will generate a lot of free cash flow. This business I mentioned that will be maybe $50 million, $55 million of CapEx. So we don't have a target for that. Obviously, the approach remains the same for us to be prudent regarding the balance sheet. And we were confident regarding our balance sheet as we speak right now. We will have room for acquisition. But if there's no acquisition, we don't mind to get to a position of 1x debt to EBITDA, but it's not a target for us. The target for us is to stabilize the business on the flyer side and to grow the business on the ISM, obviously, organic growth and acquisition. So this is more to look at it, while maintaining a strong balance sheet.

Okay. Maybe I'll ask it a different way. Assuming the M&A transactions are available to you and everything. Where do you think the business could run long term in terms of leverage? What level would you be comfortable taking the leverage up to? That's what I'm trying to figure out.

Well, it's -- I would say it's a little bit of a hypothetical question, like what we did in the past Coveris, we were comfortable to went up as far as 3.50 t because we were strongly confident in our ability to get back under 2, and that's what we did, that's what we deliver. So we -- again, we don't see -- and this is something we mentioned earlier any big acquisition coming the ISM. So I don't see any big acquisition that will push us like above 3, but it's -- like I said, we think we should be in a range of 1.50 to 2.50 in the next months. If there is an acquisition, we don't mind to be close to 1x debt to EBITDA. When we bought Coveris to, last comment on that one, we had almost noted on the balance sheet, and we were quite happy about that.

[Foreign Language] [Operator Instructions] The next question comes from Sebastian Van Berkom with Van Berkom and Associates.

Isabelle, I know you're on the line. So hello again to you. I have 2 simple questions. I just arrived, so I was a little late in kicking into the conference call. So I guess, number one, I would like to know what is the exact date of the $20 share distribution?

So we will be paying out the dividend on the 20th of March, and that's next Friday.

March?

20.

March 20?

Exactly.

Okay. And number two, given that you sold a substantial part or all of the packaging business the stub or the remaining Transcontinental, can you, Isabelle, give us some kind of a sense of what kind of a company this is going to become in the next 5 years because at the moment, the market seems to say that it's only worth about $3 after this distribution. And it means a very, very low multiple. And for me, it's just there's something wrong with this picture. So I was wondering if you could give us some clarification.

So it looks like a great body right now.

Well, the stub isn't trading yet, but it probably will trade soon after the March 20 distribution. So I'm just trying to figure that out, like it seems to be there's something wrong with the picture in that, it seems to be awfully cheap for the remaining part of the business. So is the remaining part of the business so bad that is being sold being trading at such a low price?

We think it's a good business. It's a business, but...

Pardon me?

We think it's a good business. It's a business with great cash flow. It's a business that points for growth. We see growth opportunities in the ISM sector and we see growth opportunity in...

But is this a business that you expect to grow top line at 10% a year or 15% a year? Like what kind of order of magnitude are we talking over the next 5 years?

We'll surely look to grow it internally and through acquisitions. And we have already started doing that with 3 acquisitions under ourselves only in the last year in the ISM business.

So what kind of order of magnitude are you talking Isabelle? Are we talking a 15% grower or a 10% grower? Like where are we in the next 5 years?

I think this is not something that we will disclose today. What we have said in the past is that we're -- now with the sale of packaging. Over the last 2 years, we were able to stabilize the retail and service printing business. We have growth in the media business. So today for us, and I think that we're confident to, again, stabilize the EBITDA business. We're putting this business for growth in the next few years because the portion that's growing is getting bigger and bigger, which is the ISM and even the education side of the business. So we're confident to grow the business organically over the years and then added over acquisition, but we won't disclose any organic plan or acquisition plan for the next 5 years.

Oh no, why not? Many companies do.

Well, this is not our approach. So we're not going to disclose that.

[Foreign Language] There are no further questions at this time.

Before closing the call, I'd like to turn it over to Thomas for a few words.

Thank you, Yan. And in closing, I'd like to thank you all our participants to these quarterly calls and especially to you financial analysts on the line. And I only say that your questions were always thoughtful and well received. And today, there's no difference, obviously, as you could all hear. And it's been a pleasure getting to know you over the past 3 years, and I'd like to thank you all today. Thank you very much.

[Foreign Language] Ladies and gentlemen, this concludes the conference call for today. Thank you for participating. Please disconnect your lines.