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Edited Transcript of GBF.DE earnings conference call or presentation 14-Aug-19 12:00pm GMT

Half Year 2019 Bilfinger SE Earnings Call

Mannheim Aug 20, 2019 (Thomson StreetEvents) -- Edited Transcript of Bilfinger SE earnings conference call or presentation Wednesday, August 14, 2019 at 12:00:00pm GMT

TEXT version of Transcript


Corporate Participants


* Bettina Schneider

Bilfinger SE - Head of IR

* Christina Johansson

Bilfinger SE - CFO & Member of the Executive Board

* Thomas Blades

Bilfinger SE - Chairman of the Executive Board & CEO


Conference Call Participants


* Christian Korth

HSBC, Research Division - Analyst

* Gregor Kuglitsch

UBS Investment Bank, Research Division - Executive Director, Head of European Building & Construction Research and Equity Research Analyst

* Marcin Karol Wojtal

BofA Merrill Lynch, Research Division - Analyst




Bettina Schneider, Bilfinger SE - Head of IR [1]


Good afternoon, ladies and gentlemen, and welcome to our analyst and investor conference call on the results for the second quarter of 2019. We will start with the presentations of Tom Blades, CEO; and Christina Johansson, CFO, and after which, we are happy to answer your questions. With this, I would like to hand over to Tom Blades.


Thomas Blades, Bilfinger SE - Chairman of the Executive Board & CEO [2]


Okay. Thank you, Bettina. And from my side, a warm welcome and good afternoon. On Page 2. I think the headlines are obvious for us. We're looking -- Q2 has been a very robust quarter. You'll see why as we go through the numbers. For me, in particular, I take a lot of pride in announcing that that's our eighth quarter in a row of growth, 8% revenue growth and continuing to taking orders at the same very high level that we did in Q2 of last year. So I think as far as top line momentum's concerned, we checked the box. We're on track, and we're driving forward exactly what we said we would do back in 2017. EBIT is improving. We are also limping a little with one of our subsidiaries in the technology portfolio. But I think as you look at numbers, and as Christina will walk you through them, you'll see that in E&M both in Continental Europe and the North Sea and of course, E&M International, we are delivering on plan, and I'm very pleased with the progress.

Looking at the bottom line. The net profit, it's in line with the plan. There is lot of movement there again, IFRS driven and Apleona effects let's call them that, which again Christina will show you but also they're moving in the right direction. Free cash. We're better than last year, operating cash flow has improved. It's still negative, but it was also very similar last year. We're ahead of last year and that gives us confidence to reaffirm our outlook on all fronts; top line, EBITDA and cash flow, as I will repeat at the end of the presentation. But I think the overall message is: we're robust, we're on track, and we're still growing.

We have our overview of the market as before. I won't walk through all the points but I'll pick up a few which I think are germane to our business. The orange one, this is quite interesting. Polyolefins has been a demand or growing market for many of our customers. That growth is actually plateauing out. And on the flip side, fertilizers in Europe has been a declining market for our customers and that's, kind of, a bottoming out. So we've got a plateau on the bottom on one side. We thought we would select that with an orange marker.

On the positive side, the North Sea business is still going very well, growing, both in terms of revenue, and I think, profitability. On both sides of the North Sea, both the U.K. and the Norwegian side, we think that will continue. The oil price at $60 plus or minus for Brent and $56 plus or minus for WTI, is exactly, I think, as people expect. It's above what our customers' been budgeting and therefore cash flows are positive and that cash gets converted into catch-up programs on maintenance, it's good for us. And what we also noticed in Europe is a turning point from, I think, NAFTA-driven investments to ethane-driven investments.

We see that in the projects that we're announcing Antwerp for -- I mentioned the names, but I think you know the projects in the meantime for Borealis and INEOS. We see LNG projects being announced in Germany not for export, but for import, so LNG regas terminal in Brunsbüttel. And overall that thing speaks towards gas taking a stronger role in Europe, not only in energy but also in chemicals and petrochemicals.

We flip the page, we come to our international markets. In the U.S., it's still very robust, very much driven by what's happening in the Gulf Coast of Texas, Louisiana. So a lot of projects ongoing. And we're participating in that. So for us, a robust and unchanged environment. In the Middle East, I mentioned it last time, overall demand on activity is plateauing, or even dropping as efficiently picks up. That's the red marker. What we see in our business, not only for us but also of our peers, is the orange marker, in terms of in-country value. This is where the governments of the various countries around the Gulf, in particular, Saudi Arabia, the Emirates and Oman are driving the local content.

By local content, it's first and foremost employment of locals, so Omanis, Emiraties and Saudies but also where do companies generate value, where do they spend value, where do the profits go. And the ICV calculation is actually quite complicated, but it is driving towards localization and making sure that people invest in those countries and drive business there. You're able to command a higher price or even get a last look if it's -- you have a tender, if you have the highest ICV. And this is why this is such a strong focus for people in our business, not only for Bilfinger but also for our peers. And we think we're very well positioned to take advantage of that.

We turn the page. We're often asked, of course, the infamous or famous project in Hinkley Point. For me, I'm not worried. I do see the time line moving right for the award of our bigger offer, and we thought we'd try to make it a little bit simpler to understand on this graphic. I hope it does that. I think it's very important for those who follow Hinkley Point to look at June 26 this year. This is what EDF called (foreign language), which means essentially Day Zero, and what happened there was the concrete for the foundation of the first reactor was poured. That's the picture you see in the background of our graphic there. This day, 26th of June, was exactly what they predicted. So this is one of those rare projects, which although it's a multibillion double-digit project, it's actually running exactly on time. And this, of course, means that as they progress through their time chart, then they will be awarding the -- expanding NFFFs work to us, which is now also added in what is called balance of plans.

So our expectations for the order before year-end is not only necessary for us to meet and exceed our order entry targets, but it's even more important for EDF to hit that target in order to stay on track with the project. The actual graphic itself shows that at the end of June, we had a little under EUR 20 million in orders. And these are early orders working around the engineering, working around preparing the contract, working with EDF on the time line to scope, the long deal items, everything kind of working in our direction.

Today, the end of July, beginning of August, we're above EUR 20 million. And you will see there on the graph that's what intended to show by the end of the year we'll add another EUR 200 million plus to that, probably, closer to EUR 250 million on top of what we already have. And that is going to be the award of the NFFF and the balance of plans. So high level of confidence on our side, driven by the need of EDF to stay on their time line, which to date has been amazingly on track, and will assure the order comes our way before the end of the year.

The infamous scrubber business. Again, I like this business. I like it because it's driven by things we see across the market, our customers concerned by the environment. And the curve here, it's just kind of reminder that at the end of Q2 last year although we did a lot of talking, order intake was 0. A few weeks later, that turned into a little over EUR 60 million, that's the Q3 point in 2018. And then a nice pick up, as we go through and forward, we begin to sell our production slots. Then you see a plateauing there Q1 2019 -- sorry, to Q2 2019. And that was intentional.

We kind of filled our slots, and our capacity was running at 5 units a month going forward. We then looked for additional manufacturing capacity closer to the shipyards in the Far East. We're closing on a deal in Vietnam. That will now come on stream in the second half of the year. And as we go into 2020, we'll do the same for China which is why we're now able to offer additional slots to our customers, and that's why we see the order intake going up as we go forward. So again, here we're on track. We're not one of the top 3, but we're definitely in the top 10. We see continued interest, and we see continued book building, which again, as I mentioned, we will meet with our additional manufacturing capacity in Vietnam and in China. So I think with that, I've come -- hit the highlights. I've hit the marketing backdrop, and I would hand over to Christina for the numbers.


Christina Johansson, Bilfinger SE - CFO & Member of the Executive Board [3]


Thank you very much, Tom. So let's start off with the financials, a closer look. First of all, on Page 8. Orders received. We had a very strong quarter 2. As you can see, we were in line with quarter 2 last year. And just to remind you quarter 2 last year was the strongest quarter when it comes to order intake. So we were meeting that, organically plus 1 even. The mixture being a bit different than last year. In both quarter 1 and quarter 2 this year, we have seen more a steady stream of what we call smaller projects with a size below 5 million. And we have some larger projects in the pipeline that we expect to see coming into the order books in quarter 3 and quarter 4. Hinkley Point being one, but also a number of other ones. Just to remind you, last year in quarter 2, we had a substantial order intake from our North American project, Linde Braskem, which was above EUR 100 million. Book-to-bill remains at 1 and also our order backlog after the June closing is in line with what we had last year at the same time. So very solid start, maybe also mentioning that we had, and we will come to these numbers a very, very strong order intake in Europe and also in the segment Technologies.

We're proceeding very well and not feeling any weakness in regard of the market situation.

Then Page #9, proceeding to the sales numbers. Given the very good order books that we started off this year, remind you, 12% higher-order books in January this year compared to 1 year earlier. We are also here proceeding and generating a strong sales growth.

In the second quarter, we had an organic growth of 11% in sales, and we are year-to-date at plus 8% when it comes to the revenue line.

For the full year, we are not expecting to see 8% for the full year. We are still sticking to our guidance around 5% organic growth in the revenue line for the full year.

Adjusted EBITDA improved to EUR 17 million versus last year EUR 12 million in quarter 2, and we are year-to-date then accumulated at EUR 13 million for the first half year.

So we also made an improvement here. And very, very strong performance as you will see from Engineering & Maintenance Europe and also Engineering & Maintenance International, being also strong and compensating for the difficulties we have in one legal entity in the segment Technologies, that are what we also reported after quarter 1 in line with the plan. It takes more than one quarter to solve these problems, and therefore we have also have a weak quarter 2 in Technologies, and we expect that we would now in quarter 3 and quarter 4 start to see the clear improvements here. And this single entity, we are expecting to be at a turnaround point in quarter 4 this year. Also the special items or adjustments further being reduced. We had here in quarter 2 EUR 14 million of special items, most of that related to our rollout of IT investments. So our SOP rollout and also HR systems being rolled out. But clearly, we have now spent EUR 13 million during the first half year with a clear target that is special items. The adjustment will be further decreased this year, and obviously, also going forward at -- in -- somehow in 2020 we expect to have one EBITDA line and no adjustments further.

Strong performance also on the 2 major KPIs here to get to our financial targets of EBITDA sustainable 5%. On the left-hand side on Page 10, you have the adjusted gross profit where we achieved a ratio of 8.5% in the quarter 2, which is lower than what we had last year in the quarter 2 but heavily burdened by the situation in Technologies. So if I would exclude the single unit that we are talking about, in the comparison, we would have an improvement here.

Looking on the right-hand side at the adjusted ratio for selling and administrative expenses, we had the first quarter below 8% and this is something where -- that we have been cutting back on these cost all way through the strategic implementation. So in 2016, the ratio was as high as 10.6%. Last year, we closed at 8.7%. We now have a quarter below 8%.

However, we do not expect this year that we will be able to keep 7.9% for the full year, but a further improvement to the 8.7% from last year and with a clear plan also to achieve 7.5% or below that in 2020. So a lot of activities here to further reduce our SG&A ratio.

Page 11. We're going to our 3 segments, starting off with Technologies. Clearly, also in quarter 2, with the underperformance related to one single entity, we see that we have a revenue growth, organically, 6%. We also had 5% organic growth on the order intake side. And on the adjusted EBITDA, we had a loss of EUR 12 million, most of that related to this single entity that we also mentioned in quarter 1 or after quarter 1 closing.

So year-to-date, at minus EUR 22 million in the first half year.

We're very, very pleased to see that we are stable enough to be able to make up for this loss. Thanks to Engineering & Maintenance. And we clearly see that with this year, will, unfortunately, Technologies not be able to get a positive result at the end of the year. But we will be stronger and better than the results we had last year, even if the first 6 months have been very, very tough here.

So we expect quarter 3 earning clear improvement and quarter 4, a further improvement and all in all a better number than what we had last year in Technologies.

Proceeding then to the second segment, which is Engineering & Maintenance Europe, a very, very good first half year. We moved here, 2% increase in revenue. Orders received increased with 8%, a lot of this extra turnover revenue growth and also orders received coming from Northwest Europe. Book-to-bill as high as 1.1 and adjusted EBITDA achieving EUR 28 million profit or 4% margin.

Very, very strong Oil & Gas performance, both in Norway and U.K., also the scaffolding side and our turnaround contract contributing to this excellent performance in Engineering & Maintenance Europe.

The guidance continued to be positive both on the revenue side and also on the EBITDA side. So very well on track, and a pleasure to see how well we are developing this business.

Then we have the Engineering & Maintenance International. Also here, we had very strong sales, especially in North America, organic growth 44% versus last year. Orders received, clearly below what we had last year in quarter 2. Here, we have a number of larger projects that have been delayed. So also here we are expecting to see improvements in the second half.

And EBITDA, a strong improvement here growing from 0.9% ratio last year quarter 2 to 2.9% in this quarter, both contribution improving from North America above all but also from the Middle East, so moving from EUR 2 million profit to EUR 8 million profit.

And also here, the guidance remained the same, positive developments and growing both in profitability and in sales.

We then proceeded to our cash flow side. In general, we can see that both cash flow and our DSO improved in quarter 2. DSO, just to remind you, including not only the accounts receivables, also our WIP balances and our prepayments.

In total, not enough progress here. We are expecting to see here and also thanks to stronger profitability but also thanks to a lot of initiatives on the working capital side ongoing, an improvement in quarter 3 and even more than in quarter 4. So we're expecting to pick up on the cash flow side and to see a turnaround here in the cash flow numbers.

Adjusted operating cash flow, still negative, but improved. We see here minus 8% in the quarter 2. Last year, we were at minus 19%.

On the net trade assets, we had a clear improvement on the DSO moving from at the end of March 83 days to now 78 days. Very good progress but still a lot to be reduced here in the number 78. And unfortunately, on the DPO side, we had the other way around. We had 69 days at the end of March, and we are now at the level of 65, also here substantial initiatives ongoing.

Looking at the adjusted net profit, positive, not exactly in line but almost in line with last year quarter 2, and here we need to keep in mind that we had substantial changes when it comes to the financial positions and this having a large implication on the net profit.

I will come back to that. Net profit reported being negative at minus EUR 6 million. Last year, we were at positive EUR 11 million. On the financial side, we need to keep in mind that we -- last year in quarter 2, we were able to increase the valuation of our participation note in regard of Apleona, our share, with as much as EUR 22 million in that quarter to be compared with this quarter this year where we only increased it with EUR 3 million. That is the major reason for the swings in the financial results.

If we then proceed to Page 15, just to confirm that also in quarter 2, we're able to finalize the refinancing.

In quarter 1, we went out and collected on the promissory note side EUR 123 million, no covenants, and we had an interest coupon of 2.2%, maturity 3 years.

We also turned our vendor claim note with Apleona and EQT returned that into cash EUR 128 million. The cash arrived in April. And we have in quarter 2 successfully closed new bonding of $250 million. Also here, no covenants with an interest coupon of 4.5%, maturity 5 years. And in the meantime, we are still then sitting on the repayment of the old bond, 7 years old, going back to a period of time where we had investment grade in Bilfinger at a very, very favorable rate, 2.375%.

This will be repaid early December this year. And in the meantime, it obviously has got some implication from some of our KPIs. But in December, we will then get back to the normal KPI level again.

And then I would like to get back to Tom to talk about the guidance for the full year.


Thomas Blades, Bilfinger SE - Chairman of the Executive Board & CEO [4]


Okay. Thanks again, Christina. Let me, kind of, wrap it up. Revenue up, order intake maintained at a very high level, SG&A down, EBITDA improved, cash flow improved. We need to work on gross margins in particular our problem child in Technologies. So with that, no hesitation in reaffirming our 2019 outlook.

We would like to comment on our long-term fixture, our 3 phase strategy. I think a lot of [green notes] have been set. We are not quite ready yet for ticking the box there on -- for successes in new growth areas. For that, we do need to continue what we're showing you in E&M growth International. We need to land Hinkley Point and keep the scrubbers going up. But we're confident we'll get there and be able to do that too, which, of course, then feeds into top line growth continuing. What is positive is that the refinancing is now behind us.

Great result, and again, thanks, Christina there.

And then looking forward, if I went to the right-hand column, we can already see that productivity is moving forward too and complexity is being reduced. But we're not quite there where we would like to be yet. That's part of the, let's say, the final stage for which we're also on track.

So with that being my bottom line is, we're very pleased but not yet satisfied. And with that, I would pass it back to Bettina.


Bettina Schneider, Bilfinger SE - Head of IR [5]


Yes. Thank you very much. We would now start the Q&A session.


Questions and Answers


Operator [1]


(Operator Instructions) First question comes from Gregor Kuglitsch from UBS.


Gregor Kuglitsch, UBS Investment Bank, Research Division - Executive Director, Head of European Building & Construction Research and Equity Research Analyst [2]


I have got 3 questions, please. So the first one is just coming back to Technologies, if you can give us a sense where we are now as obviously another big quarter -- quarterly loss. So I'm just trying to understand with that particular entity, I think, it was in, kind of, biopharma or something like that. Where that is? And whether it's, kind of -- as both maybe -- putting it differently when you think you can breakeven?

Second question's on cash flow. So I think you flagged perhaps some challenges, some parts of the working capital. Can I get your, kind of, comfort level around that guidance of, I think, breakeven, kind of, on a pre-IFRS 16 basis, it just looks kind of ambitious? But maybe you see, and obviously, you've got a much better view than we do externally. And then finally you haven't specifically commented on the 2020 margin target. But you do flag the challenges on the gross margin side, so I want to understand that 5% margin that you, kind of, previously talked about, at what point -- and this is not kind of mid-term anymore, it's, kind of, like tomorrow. At what point do you reassess that and what does it depend on?


Thomas Blades, Bilfinger SE - Chairman of the Executive Board & CEO [3]


Okay. Thank you, Mr. Kuglitsch. Maybe I'll take questions 1 and 3 and bounce number 2 over to Christina.

I think in terms of the loss-making entity, which is in a number of markets, not only in biopharma, what we've done there is go thoroughly through the books. I think again, if you follow our comments from last time, how did we get into this position. It was a company we acquired a while ago. We acquired with it the management and the -- the family management, and we then made progress going forward.

As part of that, management change going into late 2018 and '19, we actually reviewed what was on the books in terms of projects. We looked at the change orders at not only, potential completion but also cost to complete, and we made certain provisions. And we did that also in Q2, which led to some of the numbers you see in our bottom line in Technology.

We're relatively confident that the backward-looking part of the project reviews is done. We've also been able to enter into negotiation with the customers on a number of changing notices, which if we can then complete those in our favor as expected will drive the turnaround in that entity and take us towards at least for the quarter a black zero in Q4. That's what we're intending to achieve. We're on the way. We're not there yet, but I think going forward now, I'm quite confident that you'll see improvement in the numbers.


Christina Johansson, Bilfinger SE - CFO & Member of the Executive Board [4]


Maybe if I can add to the question number one on Technology. Last year, Technology had an adjusted EBITDA, a loss of EUR 26 million. We are now at minus EUR 22 million. We are expecting that we will be able to improve that number. However, not our original targets for this year of a breakeven, so we will see that we will start to pick up in quarter 3 and 4, but we will not be able to pick up at the speed that we will bring it to breakeven. But we are convinced that it will be a better number than the minus 26 that we had last year.

We then look at the cash flow. I think the biggest improvement -- the largest improvement that we need to gain here to improve our cash flow generation is, obviously, coming from a reduction in working capital.

And within the working capital, it is mainly our WIP balances that need to be reduced. And this is work that take some time. In many cases, these individual WIP balances can be substantial, but they are linked to negotiation with clients on claims.

They're also linked to how to interpret contract terms. And these negotiations, because you're always trying to drive for a settlement and not for legal actions, they are time consuming.

And at the same time, we're proceeding with many of these projects, so you don't want to have a situation where the cooperation is not working.

So we have an action list. We know exactly which legal entities, which projects would need to contribute to this improvement in working capital reduction in WIP. And it is difficult to judge how fast you can proceed and get settlements and get the cash into your books. But I'm convinced given also based on experience from other project businesses that we will clearly start to see this. I expect personally to see some progress on the working capital reduction in quarter 3 and then quarter-by-quarter to improve that.

In addition, it's also a lot about contract management when reassigning of new contracts, and I'm not saying that we have the full freedom here to influence the payment terms, but I think, we can do better than what we have done in the past.

And also if the whole organization is active in making sure that we're not only generating sales and generating profit on this contract, but also getting the cash in as soon as possible and also in full but also a bit of a cultural change that we are presently focusing a lot goes through the whole organization. And I'm quite confident that we will see progress here quarter-by-quarter.

That's the biggest confidence and the big -- most important project going on. Then, obviously, also with an increase in profitability in the second half, we would then also generate a sounder and stronger cash flow.


Thomas Blades, Bilfinger SE - Chairman of the Executive Board & CEO [5]


And coming to your third question, the 5% target margin. I think a lot has been written on that and what are the elements and whether we reach there sooner or we reach it maybe a little bit later.

I think on our side, we see 3 major ingredients. One is that entity that we just talked about being able to do what we just described to you. And again there we're feeling confident because we think we've put the past behind us, and we have a good pathway going forward.

The second is Hinkley Point and the scrubbers.

Those are higher-margin businesses, and we need them not only on the forward-looking data, we need them in the backlog and then we to bring them through to revenue.

I think that will happen, maybe it happens a bit later than we originally hoped, but it is part of the plan and it's part of the expectation.

And the third element is just the continued focus on execution. When we look around us, we see what happened to some of our peers, even very much larger more experienced peers on the project side that's wood -- that knocking sound is me hitting my head.

We haven't had those, kind of, big hiccups. We had one there in 2018 that we inherited, and we're paranoid in focusing on execution and delivery and avoiding those mistakes.

So those 3 things, that entity, the order intake, Hinkley Point and scrubbers and finally execution, those 3 elements will deliver the 2% or the 200 basis points gross margins we targeted, and the other comes from the SG&A component. We said at the time we will deliver a 300 point improvement -- 300 basis points improvement and we were at 10.6%, we're at sub-8% for the quarter. But we will be sub-7.5% in 2020. So that side is on track.


Operator [6]


Our next question comes from Marcin Wojtal, Bank of America Merrill Lynch.


Marcin Karol Wojtal, BofA Merrill Lynch, Research Division - Analyst [7]


So first is again on your 2020 guidance. Can you remind us if your 5% margin guidance is predicated on some further divestments or shutdowns of businesses that have a low profitability? And are you making some progress on those potential divestments? And number two, can you perhaps quantify the losses from that problematic entity in Technology that you expect in 2019 so that we can assess what is the underlying performance of that division, excluding the single problematic entity?


Thomas Blades, Bilfinger SE - Chairman of the Executive Board & CEO [8]


Okay. Thank you for the question. Let me take part 1, and I think Christina already give you some clues when she described the gross margins in part 2, but maybe she'll do that a second time.

So in terms of 2020 guidance, we still have in our other operations. We have 2 entities that we're in the process of divesting. Those entities, they're accretive, so they're currently contributing to our bottom line, so they're not loss making. They are diluted, however. So accretive in terms of they're positive, dilutive in terms of our 5% goal. So that would be one element. But we're not looking at, let's say, solving our way by, let's say, unloading, for example, that entity that's loss making in Technologies. We intend to turn it around and then that will contribute to our 5% target in 2020.


Christina Johansson, Bilfinger SE - CFO & Member of the Executive Board [9]


Okay. Talking about the losses and these losses in E&T, they are related to the project business, but not to one project, it's a number of projects. And we are here probably talking roundabout that we this year expect that these project losses in total will hit us with around EUR 25 million, mainly then coming from the single unit and related to a smaller number but a number of projects.

So by reassessment -- reassessing the cost to complete but also what we can charge in addition as claims to our customers. We have then another view of these projects and how these projects can be finalized. Some of them still being ongoing and being finalized. So we're talking roundabout, I would say, 5, 6 projects that have generated around EUR 25 million of loss or expected to generate around EUR 25 million of loss this year.


Operator [10]


There are no further questions at the moment. (Operator Instructions) The next question comes from Christian Korth, HSBC.


Christian Korth, HSBC, Research Division - Analyst [11]


I have a question with regard to the scrubber business. You have said on your presentation that the current capacity in terms of production is 5 units per month. My question would be is that also the number that you are currently producing?


Thomas Blades, Bilfinger SE - Chairman of the Executive Board & CEO [12]


Currently, it is. Yes. We are maxed out at 5 per month. We will add another 5 in the latter part of Q3, which is the Vietnam production, and then another 5 in Q1, which is the China production. But yes, currently, we're maxed out which is what led to the flat topping of that curve I showed you.


Christian Korth, HSBC, Research Division - Analyst [13]


Yes, that makes sense and that also explains, I guess, part of the growth in Technologies then in the year-over-year comparison.


Operator [14]


There are no further questions at the moment. (Operator Instructions) As there are no further questions, with this, we conclude today's conference call. And if there are other things you would like to discuss with us, the IR team is available. Thanks for joining this afternoon and goodbye.