Vienna Insurance Group AG (VIG) Earnings Call Transcript & Summary

Ladies and gentlemen, thank you for standing by. I'm your chorus call operator. Welcome, and thank you for joining the Vienna Insurance Group conference call. [Operator Instructions]. I would now like to turn the conference over to Nina. Please go ahead.

Thank you, operator. Good afternoon from Vienna, and welcome to our half year results conference call. I'm pleased that our CEO, Elisabeth Stadler, is with us to give a short overview and share the key messages of the first half year results with us. And afterwards, Liane Hirner, our CFO, will take you through the details of the financial developments of the first half year. As already mentioned, afterwards, there is time for a Q&A session. I now hand over to our CEO, Elisabeth.

Thank you, Nina. Welcome, everyone, to today's call. We are pleased to be able to present a solid set of results with which we underpin our ambition to be a stable and reliable partner for our customers, employees and stakeholders, particularly in uncertain times like these. I think all of us know, COVID-19 has changed our life for all of us. And as long as there is no safe vaccine, we are far away from back to normal. Flexibility, diversity and quick decisions, according to local needs, are more important than ever. In all these areas, VIG's business model once again proved to be successful. Our strong balance sheet, solid capitalization, at half year, our solvency ratio is at satisfying 183%, and our prudent accounting approach built a strong foundation to master the challenges we are facing at the moment. Our broad diversification across countries, distribution channels and lines of business allows us to continue to take advantage of any opportunities that arise and pursue our long-term growth ambitions. Under our agenda 2020 management program, we have been focusing on improving our profitability on the one side and our future liability on the other side since 2017. The clear emphasis is the promotion of the digital transformation of our group and the digitization investments paid off. Online tools and digital services were in great demand and heavily used during the last months during the COVID-19 pandemic. Since autumn 2019, we are, together with our biggest Austrian group company, Wiener Städtische, founding partner of Plug and Play, the leading global innovation platform, and we are continuously sculpting potentially interesting start-ups for new ideas, solutions and services for our company. We see ourselves well-positioned to successfully continue business operations. Given our excellent results in 2019, and we are planning to propose a dividend per share of EUR 1.15 at the virtual Annual General Meeting, which will take place on the 25th of September 2020. We are aware of the recommendation of the financial market authority and fully acknowledge the intention behind this recommendation to refrain from distributing dividends. Nevertheless, we carefully review the current macroeconomic and financial environment as well as VIG's solvency and financial position. Being aware of our responsibility as one of the leading insurance groups in Austria and CEE and keeping in mind a fair balance of interest of all stakeholders, we stick to our dividend proposal, which is fully in line with our dividend policy. By doing so, we keep our track record of paying dividends to our shareholders in each of the 25 years since we are listed on the Austrian Stock Exchange. Our solid capitalization and the achieved performance in the first half of 2020 make this, in my opinion, an appropriate proposal, also in view of the large share of pension funds and retirement schemes in our free float that count on our dividend payment to fulfill their obligations towards depositors. Based on the solid half year results, which Liane will then present in more detail shortly, we currently feel that the effects of COVID-19 on our operational business are clearly manageable. Uncertainties, of course, will stay, especially regarding capital market development. And also, our investment strategy overall remains unchanged. Of course, specific industries are reevaluated. The details of our investment splits are shown on Slide 18. You know this graph, and I would like to take the opportunity to quickly update you on a new topic on our VIG Fund, which is part of the more than 7% of real estate investments. The VIG Fund was established in 2011 and reached a market value of more than EUR 400 million by the end of last year. The focus of investments is real estate in top locations in our CEE region, which are fully managed by VIG Holding. Currently, the Fund includes 22 properties in Czechia, Slovakia, Poland, Hungary and Latvia, and provides an average gross yield of roughly 6% per year to the invested VIG Group companies. Thinking of potential impacts on the VIG Fund out of COVID-19, I would rate them as rather limited. Again, this is a well-diversified portfolio with a broad tenant structure, having only a low share of retail usage and which does not contain any hotels or shopping centers. Moreover, the office space in our fund mainly consists of rather inner city units rented out in a diversified manner. Finally, ladies and gentlemen, let me shortly summarize my key messages on Slide 9. VIG is well-positioned and will successfully continue its operational business. Profitable insurance business and the digital transformation of the group stay in focus also for the next years. In view of COVID-19, the uncertainty regarding the future economic development remains high. Nevertheless, being active in Central and Eastern Europe, our experience in these markets and their approach to crisis as well as various studies, we hope that the region will not be hit as hard as Western Europe. They might even come up chances arising from CEE from near-shoring possibilities going forward. But we keep our prudent approach and stay cautious regarding future development. Further dampening effects are, of course, to be expected. Therefore, our solid half year results are pleased not to be projected for the full year 2020. Given the exceptional situation and the uncertainties regarding capital markets, interest rates and also regarding the political and regulatory environment, you won't be surprised to hear that we are refraining from announcing a business outlook for 2020 now. Ladies and gentlemen, I'm sure you will understand that. And with this, I hand over to Liane, who will give you more detailed insight in our half year results. Liane, please.

Thank you, Elisabeth, and a warm welcome also from my side. The highlights of our satisfying half year results are shown on Page 11. Premiums increased by 2.4 percentage points to EUR 5.6 billion, despite the expected substantial decreases in new business in the second quarter this year. Nevertheless, due to the strong start into the year and our broadly diversified portfolio, we are able to achieve premium growth in the first half of 2020. On Slide 15, you can see that this growth is mainly driven by other property business and helped 2 lines of business that have a clear focus on to grow further in the future. VIG generated a profit before taxes of EUR 201 million, which already considers the goodwill impairments we have announced at the beginning of August. Based on the ESMA recommendation from May 2020 and given the uncertainty regarding the effects of COVID-19 on the further macroeconomic developments, we decided to execute an event related impairment tests, which led to the goodwill impairment of in total EUR 118 million. We wrote down the full outstanding goodwill for Croatia in the amount of EUR 45 million and for Georgia in the size of EUR 13 million. The result of Bulgaria is impacted by a goodwill impairment of approximately EUR 60 million. We are very pleased with the combined ratio development in the first half of this year and the reduction by 0.9 percentage points to 95.5%. This was supported by a favorable claims experience and by roughly EUR 15 million less weather-related claims. Compared to year-end 2019, the combined ratio remained stable. Turning to page. We present the IFRS income statement. Maybe just one word regarding slightly increased tax ratio of 34%. Please keep in mind that the mentioned goodwill impairment is not tax deductible. Without goodwill impairment, the tax ratio would be 21.4%. I will come to the financial results in a minute, but would like to switch to Page 13 for a short overview on our main markets: Austria, Czech Republic, Slovakia, Poland and the Baltics. Based on half year figures account for roughly 80% of total premiums and recorded EUR 285 million on profit before taxes. In all these markets, we achieved double-digit growth rates for profits, and the already-mentioned improvement in the non-life profitability shown by the reduced compliance ratios. Premium development differs from market to market depending on the COVID-19 related measures taken. Let's now directly move on to the financial results, which is shown on Slide 19. The financial result, excluding at equity consolidated companies, is down by 4.8%. Here, I want to remind you that the figures of 2019 still contain the contribution of the nonprofit housing societies, overall, an impact of roughly EUR 36 million in the first half year 2019, which are no longer included in the financial results due to the consolidation change last year. I would like to end my part of the presentation with the solvency ratio development, which is shown on Slide '20. The solvency ratio of 183% as of 30th June was impacted by the low interest rates and the current market environment, both in their own funds as well as in the SCR. We feel well equipped as the solid 183% solvency ratio and expected this development in view of the market movements that we constantly monitor. With this, we have come to the end of our presentation, and Elisabeth and myself are happy to take the questions you might have.

[Operator Instructions] The first question comes from Youdish Chicooree.

It's Youdish from Autonomous Research. I've got just 2 questions. The first one is on just the premium growth in motor. I mean, you grew 5% in Q1. And obviously, second quarter was impacted by the COVID-19 disruption. I was wondering whether you could tell us what you're seeing in terms of premium growth in MTPL and Casco in July and August? That's my first question. And then secondly, just on the insurtech and digitalization initiatives, you've mentioned in the slide, you talked about gaining access to 300 start-ups and meeting up with 43 of them. I was just wondering whether you could tell us how much you're prepared to invest in these companies? And how much you've invested so far?

Thanks, Youdish. Let me start with the first question. The premium growth in motor. Of course, we have seen a decrease in the first time after the lockdown that is quite clear. There was no mobility. There you could see less cars on the streets in nearly all our countries. And of course, we are coming back to a quite normal situation at the moment. This differs from country to country. And I would say, our diversification is really helpful in this situation. We always see countries where the lockdown is really hard, and we see other countries where the Lockdown is very smooth or where we are coming back to normality already. Of course, we see an increase in July and August. This is quite clear because there is more traffic, there is more activity on the roads. And of course, we see that there are still less cars sold than in the years before, but it's going up in the last 2 months.

Just in terms of the 5 main markets you mentioned earlier, is there a big difference between these markets?

Of course, there is a difference between the markets. I would say, Austria and Czechia, they are quite similar. The situation is a little bit worse in Slovakia. And on the other side, we see a very good development in Poland. And especially in the Baltic states, the lockdown was quite heavy. And there, we saw a -- I would say, in the Baltics, we saw the biggest decrease in the premium in motor insurance in the first months after the crisis. And there, we are still not at the level before the crisis. Then your question concerning the digitalization initiative. You have seen, we had more than 300 really interesting candidates, which were preselected from Plug and Play. And we run 40 meetings, and we have identified 10 interesting candidates where we are going into deeper analysis now, and this could be of interesting cooperation for our operative insurance companies. You asked how much we would be willing to invest? I think we -- that depends, of course, on the due diligence and on the outcome and the prognosis of these activities. We have made a reservation of, I would say, about EUR 20 million per year for initiatives like this. But of course, if there is a business plan behind where we can see that there is a positive output or that we can earn our money back, then maybe we even would be willing to invest more.

The next question is from the line of Oliver Simkovic with RCB.

I actually have 3 of them. The first one is regarding claims. Can you give us some more insights into what kind of impact the pandemic had on claims, sort of negative impact from that? And also, maybe if you have the information on the positive contribution from potentially lower claims in motor insurance? Maybe in line with this also whether you expect a gradual recovery in motor insurance claims to precrisis levels? Or you are already seeing a full recovery in the summer? The second question is regarding premiums. I mean, in the second quarter, it seems like P&C and health held up pretty well. The biggest decrease was in life insurance. Do you expect life insurance effects similar to the second quarter to continue also in the coming quarters? Or do you see somewhat of a recovery as the lockdown ended? And lastly, regarding financial results, you mentioned that part of the relatively good result is due to the reallocation of amounts in the portfolio, which triggered some realization gains. Could you give us information how much this actually was?

Oliver, thank you. I would hand over to the first figures to Liane for the claims, and then I take over for the premiums and finish the claims again.

Okay. So I will take the third question regarding the financial result. We did some reallocations. We amended the new investments in the first half year of 2020 to hit the new reality of significantly reduced new production volumes. The impact is a lower double-digit million Euro amount.

Okay. Then I take over the question concerning the premiums, especially, you wanted to know about the situation in life insurance and the effect. Order here, I can give the same answer as we have heard before, due to our diversification, we see really very, very different effects in the different countries. Of course, life insurance significantly went down immediately after the crisis. I think that is quite normal if you have to take care of how to handle the situation, how to change from a business office to home office. If you don't know what will be the situation of your employer and so on. Then, I would say, the first idea of the client is not to conclude a life insurance contract. So the situation was that this went down significantly, the new premium business in life insurance. But I must say that the situation has changed, and it's slightly going up now. We see that in critical times like these, the clients are now taking more and more care of their future care. They are especially looking at health insurance and also at pension insurance. We see in a lot of countries, some single premium amounts which are invested into life insurance contracts, into pension insurance contracts. So the clients are taking care of the future security, you can say. And I think we will see this effect until the end of the year. If you have seen the figures, life insurance is quite flat. It's slightly going down in current premium and on the other side, slightly going up in single premium. So if you ask me, it's hard to give an outlook for the end year also in this case, but I would expect that the situation will be quite flat until the end of the year in life insurance.

The next question is from the line of Michael Haid with Commerzbank.

Three questions, if I may. First, on the combined ratio, combined ratio 95.5% in the half year or 95.9% in the second quarter stand-alone? Given the lockdown periods in the second quarter, I would have expected a bigger impact from the lower frequency losses in motor. Can you tell us why this has not been the case? From my understanding, you may have also incurred higher severity, but I'm not sure about this. Second question on the solvency ratio, which improved from 170% to 183% quarter-over-quarter. Surprisingly stronger, in my view, when I compare you to other insurance companies for other insurers, the volatility adjuster in the solvency calculation was a burden in their solvency calculation, was that also the case for you? And did you take any management actions to support the capital position? Last question, on Slide 15, you showed some significant growth in other non-motor property business, plus 7%, EUR 2.7 billion. Can you tell us in what lines you generate this strong growth? And maybe also in what regions?

Thank you, Michael. We would start with the question 2, solvency ratio, I hand over to Liane.

Thank you, Elisabeth. With regards to year-end 2019, we saw a decline in the solvency ratio. This is mainly affected by the low interest rate environment. As we all know from year-end 2019 to mid of 2020, we are facing a significant decline of the risk-free interest rate up to 400 basis points depending on the maturity band. Therefore, our SCR increased up to 6% due to a smaller mitigating effect of the deferred taxes and profit sharing. On the other hand, our own comps are reduced by minus 10%. This mainly comes from the traditional life business in Austria. All in all, this is summing up to a loss in the ratio by around 25% compared to the year-end 2016. In the second quarter, we saw a small recovery, let me put it like this: credit spreads went down and also the equity markets went up. So it's a quite stable development in the second quarter of 2020.

Did you take some management actions in the second quarter? For instance, is the reallocation of investments, did that help you? Did you lengthen the duration?

Not really. What I can say is that we are further having a focus on strengthening our asset liability management. We are -- have still the focus on optimizing our life insurance portfolio mix. So no specific measures in the second quarter.

Okay. Then I will take question number one, concerning the combined ratio, and you asked about motor insurance and lower frequency. Of course, we saw lower frequency. And of course, we saw higher severity. We have seen, on the other side, there was lower frequency in claims. But of course, the claims incurred and the amount of the claims normally was quite heavier than we have seen the standard before the crisis. And of course, the combined ratio is infected by an IBNR reserve, which we have put in a double-digit million provision for claims incurred but not yet reported at the moment. Question number three, the significant growth of 7% in other non-life, this is driven by, I would say, normal increase in individual business, and especially bigger increase and bigger growth in corporate business.

Okay. The IBNR reserve, can you say is it a low or a higher double-digit million amount? I have to ask.

I would say it's a low double-digit amount. You know we are conservative, but I think we manage our business quite well. So I think this will be sufficient for us to have a low-digit provision in that case.

The next question is from the line of Thomas Unger with Erste Group.

I have a few. First of all, you talked about the dividends and your arguments, you laid them out on why you stick to your proposal. But do you see a risk that the FMA would block the distribution still in September? And then the second question on the financial results, you also explained the gains that you recorded in Q2. But assuming a normal or not extraordinarily high level of volatility on the financial markets, what could be a run rate for the coming quarters for the financial results? Would it be between EUR 160 million and EUR 180 million per quarter? And then also, thirdly on Romania. From looking at the quarterly developments, the profits were really strong in Q2 compared to previous quarters. Gross written premiums were lower, but net earned premiums were higher. Can you explain the development in Romania, please? And then also, I understand that you don't give guidance for the full year 2020, but is there something that you can say about the underlying operating performance for the near future, the coming quarters? Trends and premiums, can we expect the full year premium level to be higher than last year or below?

Thomas, thank you. Quite tricky questions you are putting to us. Liane would like to start with the financial question -- or with the answer to the financial question.

Okay. Here, I would like to state that due to the current uncertainties, especially on the financial market, it's not possible for us to give a run rate for the next quarter. Sorry for that, but it's really impossible.

Okay. Then I take over to the dividend question. As you know, the Austrian FMA, obviously, quite well. I again must say that this is, of course, a recommendation and, of course, we understand this recommendation, but there are some other rules how and when insurance companies are able to pay dividends. This depends on the solvency ratio. And in our opinion, our solvency ratio is really very stable. You know that our capital basis is quite a strong one and also Standard & Poor's is always mentioning this in their reports, we had a fantastic year 2019. And so we really feel well-positioned to pay the dividend to our shareholders, especially as there are -- as I already mentioned, a lot of private investors through the pension funds and the pension schemes who are really waiting to getting out their money. And of course, they will, for sure, invest this money. So I think this is a good measure to keep the capital stability and the capital investments in our world. So this is the reason why we stick to our dividend proposal of EUR 1.15. We already have calculated this in our solvency ratio in all our calculations. And if you look at the half year result, more than EUR 200 million after a write-off of EUR 120 million, I think we really are in the position that we can take this decision, and we can make this proposal. Concerning your question, Romania, of course, we see -- and you know this that the Romanian market is a very difficult one or was a very difficult one. We had a lot of motor portfolio there. The premium situation was not the best one for the insurers. You know that we had these premium caps and that we had the reference premiums. We have set up a lot of activities and the loss measures, and we now see that we can profit out of these measures that these measures really make good effects. We focus on profitable MTPL business and motor business, and our activities now pay off. And hopefully, we see this development also for the next months. Maybe there are some special effects in the second quarter. But in general, we are really satisfied that the situation has changed in Romania. We have, I think, the first time since 3 or 4 years, a combined ratio less than 100. This is not market standard, but we are clearly below 100 at the moment, and it is the clear intention and the clear goal to stay in this level and make profit also out of our motor business in Romania. Then you wanted to have a guidance 2020. I think all the insurance companies and all the companies at the moment are really not able to give a serious outlook. And especially for us as insurance company, we are a very conservative company. We are always looking into the future. So I think this would not be serious to give an outlook at the moment. What we mentioned is that we can manage our operational business that we know our insurance business quite well and that we don't see at the moment any big surprises in this case. But of course, the situation on the capital markets, on the interest and the development of the capital markets is still quite unsecured. So I really ask you to understand that we are not able to give a guidance at the moment.

The next question is from the line of Fossard with HSBC.

I've got a couple of questions. The first one will be related to the goodwill you may still have on other regions. I was wondering how safe they were in light of the COVID environment? The second question was any potential contribution to relief fund in Austria? I think that was part of the discussion at the Q1 call, has the market come to any conclusion on this? And the third and last question will be related to potentially the liquidity position of the group, the funding of the 2021 dividend. Obviously, you've been talking of the Austrian regulator. But can you talk about possibly, I would say, the regulatory environment in your other operating entities outside Austria where potentially you could face, I would say, a bit more restriction in dividend upstream back to the group?

So thank you. Liane will start, yes.

Thank you. I will take the question regarding your goodwill impairment. As we already announced in our ad-hoc announcement on 10th of August, we decided to conduct a scenario analysis for certain tax-generating unit groups, which, at the end, led to this goodwill impairment of EUR 120 million. In total, our goodwill amount to EUR 1.2 billion now, if there would have been more requirements regarding the half year, we would have booked it. So this is everything for the moment. I cannot exclude any seasonal measures until the year-end, as we already explained that the goodwill impairment mainly was due to significant increases in the discount rates. So it heavily depends on the development of the discount rates in the capital markets.

Okay. Thank you. The second question was contribution to this fund in Austria. And I think this has been published officially that all the Austrian insurance companies or the Austrian insurance industry has created together with our government an assisting fund of about EUR 100 million for this business interruption insurance for especially touristic enterprises. And we are participating in this fund, of course, because we are running this business in both of our operating companies and, therefore, we are participating in these funds in the amount of our market share. Our market share in Austria is about 25%. We have seen that these solutions have been accepted, I would say, by about half of the involved clients until now, and we would expect that we will see that this fund will be fully accepted and fully used by the involved same participants, yes. Then you asked about the liquidity position for 2021. You know this, and maybe you have heard this that due to the COVID-19 pandemic and due to the uncertainty about the future economic development, some countries where our VIG insurance groups in our insurance companies operate have restrictions, looking on dividends or have recommendations from the regulators that they are -- shall not pay out dividends. This is the case for Czechia and Poland at the moment. So we did not get dividends until now from Czechia and Poland. We got dividends from nearly all our other countries. The result is that we have about 50% reduction of the dividends paid to VIG Holding in the first half of 2020, but this does not have any effect on the cash or cash equivalents available in the group, and this is -- does not involve our cash flow statement. Of course, we expect that we will get the dividends maybe later this year or if we want to be able to get them this year, for sure, we will get them next year. So I think the liquidity position for 2021 for paying dividends is quite sufficient at the moment. I don't know if you know, but, for sure, you would intend that as we are conservative, of course, we are looking also in this direction, paying dividends out from a conservative perspective. And of course, we have done some reservations for paying dividends, not only for this year, but also for the next year.

[Operator Instructions] The next question is from the line of Ashik Musaddi with JPMorgan.

I just have one question as most of my questions have been answered. I mean can we get a walk-through for the solvency ratio from 210% to 183%? And apologies if it has already been answered because I joined the call a bit late. Sorry for that.

Okay. We experienced a reduction of the solvency ratio in the first half year of 2020. The main decline related to the first quarter to the market developments, especially in the first quarter 2020. In the second quarter, we saw a stabilization or a small increase in the solvency ratio. It explains already that the main effect relates to the ultra-low interest rate environment, so the risk-free rate declined up to 400 basis points depending on the maturity band. Our SCR increased by 6% and -- due to a smaller mitigating effect of the deferred taxes and profit sharing. And on the other hand, our own funds are reduced by minus 10%, this mainly is related to the Austrian traditional life business. So this is a short summary on the development of the solvency ratio of the first half year.

Okay. But just like -- I mean, it looks like majority of the drop is because of interest rate. And if we speak to anyone, it looks very unlikely that interest rates are going anywhere in the near future. So how do you think about this 183% solvency ratio? Are you pretty comfortable with it? Because I mean, that you have been running your balance sheet at about 200, north of 200% solvency ratio and now it is well below that. So how do you feel about this 183%, especially given there is a reasonable UFR element as well in the solvency ratio?

In the light of the current environment, we feel very comfortable with this group solvency ratio.

The next question is from the line of Desmond Kinch with Overseas Asset Management.

Sorry to belabor the point on the solvency ratio. My recollection was that the company said that the bottom end of the company's comfort level with the solvency ratio is 180%. Clearly, you are especially confident with the 183% level today to pay a dividend. Could you please restate what your comfort level is in terms of the solvency ratio? And then I have a second question relating to the goodwill impairments of about EUR 120 million in Bulgaria, Croatia, and Georgia? In all 3 of those markets, the combined ratio fell, so the -- there wasn't a problem with underwriting losses, claims losses or expense ratios in those markets. Could you please give us a bit more understanding of why the decision was taken to make those goodwill impairments?

Okay. Thanks for your questions. Our CFO, Liane, will take over the questions.

Thank you. Regarding the first question, solvency ratio, our comfort zone starts with 170%. So 183% in the current environment is very -- we feel very comfortable with that ratio. And I would also like to mention that in the current group solvency ratio, dividends are also deducted. When we come to the goodwill impairment, I explained that the reason for the goodwill impairment is not so much the underlying business, it's more the increase -- or to the major extent, the increase in the discount rates due to the volatile market environment in this current COVID-19 pandemic. So it's not so much due to the underlying business, it's a technical issue. That we have substantially increased country risk premiums, this is technical.

The next question is from the line of Fossard with HSBC.

Just a remaining one regarding your reinvestments rate or your new money yield in your fixed income portfolio. Could you shed some light on what has been the average reinvestment rate year-to-date? And how this compares to last year?

Yes, I'm going to answer your question. Our new money yield in the first 6 months 2020 in Austria amounts to approximately 1.7 percentage points, which is a decline compared to 2019, which -- where it amounted to 1.83 percentage points. And of course, given the volatile market environment since March this year, we expect the new money yield also coming further down in the next weeks -- in the next month.

The guaranteed interest rate in Austria -- the maximum guaranteed interest rate in Austria for new business at the moment is 0.5%. Just to give you an information of what we promise to the clients and what do we earn on the other side.

The overall yield on the fixed income in Austria in the first 6 months amounts to approximately 2.8%.

2.8% is the running yield. Is that right?

Yes.

Um-hmm.

There are no further questions at this time. And I hand back to Nina for closing comments.

Okay. Thank you all for your interest and for listening in. Maybe you're interested to hear that the 20 -- the Annual General Meeting is held on 25th of September, and there will be a broadcast of the event. So when you're interested to listen in, there will be a link on the web page. Goodbye from Vienna, and stay safe and healthy. Bye-bye.

Thank you. Bye-bye.

Bye-bye.

Ladies and gentlemen, the conference has now concluded, and you may disconnect your telephone. Thank you for joining, and have a pleasant day. Goodbye.