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Edited Transcript of HERDEZ*.MX earnings conference call or presentation 24-Apr-20 4:00pm GMT

Q1 2020 Grupo Herdez SAB de CV Earnings Call

Mexico City Apr 29, 2020 (Thomson StreetEvents) -- Edited Transcript of Grupo Herdez SAB de CV earnings conference call or presentation Friday, April 24, 2020 at 4:00:00pm GMT

TEXT version of Transcript

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Corporate Participants

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* Andrea Amozurrutia Casillas

Grupo Herdez, S.A.B. de C.V. - Head of Corporate Finance, Treasury & IR

* Gerardo F. Canavati Miguel

Grupo Herdez, S.A.B. de C.V. - CFO & CEO of the Frozen Division

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Conference Call Participants

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* Alan Alanis

Santander Investment Securities Inc., Research Division - Head of Mexico Strategy and Sector Head for Food & Beverage

* Álvaro García

Banco BTG Pactual S.A., Research Division - Research Analyst

* Felipe Ucros Nunez

Scotiabank Global Banking and Markets, Research Division - Analyst

* Jafar Rizvi

Harding Loevner LP - Partner, Portfolio Manager & Analyst

* Miguel Angel Tortolero

GBM Grupo Bursátil Mexicano, S.A. de C.V. Casa de Bolsa, Research Division - Research Analyst

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Presentation

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Operator [1]

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Good morning, everyone, and welcome to Grupo Herdez First Quarter 2020 Results Conference Call.

Before we begin, I would like to remind you that this call is being recorded and that information discussed today may include forward-looking statements regarding the company's financial and operating performance. All projections are subject to risks and uncertainties, and actual results may differ materially. Please refer to the detailed note in the company's press release regarding forward-looking statements.

At this time, I would like to turn it over to Mr. Gerardo Canavati, CFO and CEO of the Frozen division. Please go ahead.

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Gerardo F. Canavati Miguel, Grupo Herdez, S.A.B. de C.V. - CFO & CEO of the Frozen Division [2]

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Thank you, Anastasia. Good morning, everyone. Thank you for joining us on today's call.

As all of you are aware, these are completely different times and who knows for how long. So first of all, we hope you and your family are all healthy. Our results for the quarter were marred by the explosion of COVID-19. In Mexico, this very uncertain environment turned into aggregated demand shock on top of an economic slowdown. Industrial production fell, GDP contracted, while the peso collapsed to record levels.

We are living a historical moment, unfortunately, a negative one. And with the absence of substantial fiscal and monetary responses as the developed world has implemented, the outlook for Mexico GDP is dark.

As usual, Andrea will walk you through the results for the quarter, and we will take your questions at the end of this call. Andrea?

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Andrea Amozurrutia Casillas, Grupo Herdez, S.A.B. de C.V. - Head of Corporate Finance, Treasury & IR [3]

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Thank you, Gerardo. Good morning, everyone. Net sales increased 10.4% during the quarter. Growth was mainly driven by significant volume demand towards the end of the quarter as a result of the health crisis that moved consumers to build up their food stocks. In fact, 2/3 of our portfolio grew at double-digit rates in the quarter.

On the other hand, our Frozen business was affected by crumbling traffic figures in the last 2 weeks of the quarter, coupled with weak DSD sales for Helados Nestlé. In exports, net sales increased 9.6% in the quarter. Consolidated gross margin in the quarter was 37.8%, in line with the first quarter of last year. The benefit of cost aversion resulting from higher sales in our Preserves portfolio, exceeding in offsetting an unfavorable sales mix between channels in the Frozen division.

In exports, gross margin increased 5.4 percentage points for the quarter. Consolidated SG&A was 26.2% of net sales, in line with the same period in 2019. In the Frozen segment, SG&A increased 4% as expected due to higher marketing spending to support new products in Helados Nestlé.

Consolidated EBIT and EBITDA before other income grew 7.2% and 3.7%, respectively. As you read in the press release, we registered extraordinary income of $194 million, resulting from the divestiture of 50% of our tuna fleet, according to our plans to pursue better returns for that portfolio. After extraordinary income, EBIT and EBITDA grew 34.6% and 27.2%, respectively, while the margins stood at 14.9% and 18.3%.

In the quarter, equity investments in associated companies was MXN 137 million, 40.2% lower than in 2019 as a result of ongoing challenges in the Frozen division of MegaMex in combination with a significant drop in Wholly Guacamole sale away from home.

Consolidated net income in the quarter was MXN 666 million, which was 28.8% higher than the previous year. Our cash flow generation remains strong after buying back 8.2 million shares in the quarter and CapEx of MXN 105 million. As of March 31, consolidated cash was MXN 4.2 billion, which in addition to cash flow generation includes the disbursement of MXN 1.5 billion in committed bank line as a precautionary measure and the sales of the tuna vessels.

Interest-bearing liabilities, including IFRS lease debt, totaled MXN 10.5 billion with an average life of 5.1 years and an average cost of 8.3%. Leverage ratios remain comfortable as consolidated net debt-to-EBITDA was 1.5x. The net debt to consolidated stockholders' equity ratio was 0.33x.

With that, I will now turn the call over to Gerardo.

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Gerardo F. Canavati Miguel, Grupo Herdez, S.A.B. de C.V. - CFO & CEO of the Frozen Division [4]

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Thank you, Andrea. The first 2 months of the year were very good for our Frozen division. In Nutrisa, both traffic and average ticket continued to improve and Helados Nestlé was making progress in terms of penetration and innovation with the introduction of 2 blockbuster items, Baileys and KitKat. However, with the lockdown trend interrupted in March as a health measure to protect our employees and clients, we decided to close all retail outlets on April 1 until further notice.

In line with our commitment to our shareholders, we continue assessing the feasibility of divesting from our Tuna business to improve the company's portfolio. We will keep you posted regarding any addition to what we have reported as of today. Our CapEx budget of $900 million for the year is unchanged as of today because CapEx is generally a function of internal rate of returns, and we believe that investment is counter site-able.

As you all are aware, trying to forecast the impacts of COVID-19 for the remainder of the year is a real challenge since we don't know how long it will take and how profound the impact will be. We foresee continued increases in our preserves top line, being able to counteract the lack of sales at Frozen. But the real question is the effect that the drop in disposable income will have in consumption in the back half of the year.

Regarding SG&A, we are performing a detailed analysis in order to contain expenses as much as possible to offset the EBIT margin erosion. The biggest unknown is when and how consumers will get back to the retail environment. Regardless of this, and the efforts to contain operating expenses, which are fixed, our commitment stands to the wellness of our team over any profitability target.

We are confident that the combination of our innovation efforts and changing consumer habits towards eating at home will benefit dynamics for our sector in the near future, and we are well prepared to capitalize on that opportunity.

Our long-term vision for our retail business is unchanged, as we have a strong brand portfolio with unprecedented opportunities. In fact, our plans for expansions are taking the front seat as all orders are downsizing. The weaker peso will have a significant impact over our profitability target. As of today, we do not have plans to increase prices in the foreseeable future. Having said that, we are unable to give a forecast with accuracy until the second half of the year. What we can assure you is that we manage our business for the long term, taking risks with prudence and seizing opportunities for great brands.

We will continue working on maximum capacity, prioritizing the health of our personnel and continuing of our operation -- the continuity of our operations. We'll reinforce our commitment to Mexico and its people. Last year, shareholders' total return was 7.9%. 2/3 of this return came from buyback. In yesterday's ordinary shareholders meeting, an increase in the buyback program was approved. That doesn't mean that it will be used immediately. On the contrary, we will continue to be opportunistic and prudent for the near future.

That concludes our prepared remarks. We would now like to open the call to your questions. Please go ahead, Anastasia.

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Questions and Answers

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Operator [1]

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(Operator Instructions) Our first question comes from Miguel Tortolero with GBM.

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Miguel Angel Tortolero, GBM Grupo Bursátil Mexicano, S.A. de C.V. Casa de Bolsa, Research Division - Research Analyst [2]

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The first one is regarding preserves. We saw strong performance in sales during the quarter, which, as you mentioned, is partly explained by the sales at the end of March. Could you share with us how those trends have evolved during April?

And the second one is a quick one. Do you have any update on the 2 tax issues that you shared with us last quarter, the potential refund and the auditing of your statement.

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Gerardo F. Canavati Miguel, Grupo Herdez, S.A.B. de C.V. - CFO & CEO of the Frozen Division [3]

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On the first one, April has the same trend. April has been strong in sales. We expect lesser strong May and then a downward trend because what we have seen in these 2 months is that this is really -- part of this is really consumption because it's consumed at home. So this effect, we believe, is going to last 2 full months. And then in May, the growth rate will slow.

Now on your second question, can you repeat it, please?

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Miguel Angel Tortolero, GBM Grupo Bursátil Mexicano, S.A. de C.V. Casa de Bolsa, Research Division - Research Analyst [4]

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Yes. Just if you have any updates on the 2 tax issues that you shared with us, I think, last quarter?

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Gerardo F. Canavati Miguel, Grupo Herdez, S.A.B. de C.V. - CFO & CEO of the Frozen Division [5]

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No. No. No. We don't have any update on that. I think it's a very -- this is going to take time because, as you know, all the government and all the court houses are closed. So we don't have any information regarding that.

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Operator [6]

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Our next question comes from Felipe Ucros with Scotiabank.

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Felipe Ucros Nunez, Scotiabank Global Banking and Markets, Research Division - Analyst [7]

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Yes. Thanks for the time for the call, and I hope you and your families are doing well throughout this whole crisis.

Let me -- I have a couple of questions, but let me begin the first one with M&A. You mentioned that there are no plans to slow down investment, which is -- it's a stark contrast to most of what we've heard from all of the other peers in the sector. Obviously, part of that is because you're not very levered, so you have the chance to do it. I also imagine it's also because you play in a sector that not everyone else plays. You are in foodservice, and that's probably one of the places where you might see the most bankruptcies and the most troubled companies in need of a bigger hand to come and help them.

Is this the sector where you would like to focus any M&A chances during the crisis? Or are you thinking more about something in Preserved or something in the U.S.?

And then my second question is about the status of the factories. If you could give us some color on exactly what the status is?

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Gerardo F. Canavati Miguel, Grupo Herdez, S.A.B. de C.V. - CFO & CEO of the Frozen Division [8]

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Felipe, same to your family. Same as with Miguel, I didn't get your second question.

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Felipe Ucros Nunez, Scotiabank Global Banking and Markets, Research Division - Analyst [9]

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Sorry about that. So the second question is about the plants and the operations. I was wondering if you could give us an update on how the plants are doing. Any -- I mean you mentioned in the report some of the difficulties, but I was wondering how you're planning contingencies if you have to do any other shutdowns or anything similar?

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Gerardo F. Canavati Miguel, Grupo Herdez, S.A.B. de C.V. - CFO & CEO of the Frozen Division [10]

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Yes. Perfect. All right. So let's start with the second question. Since this crisis erupted, we have had a lot of protocols in the plants because we are -- our plants are an essential business. So we have -- probably, we have about 3 daily meetings in different levels. One would be very operational, one would be medium and then with top management about COVID.

So we are in very close communication. We have all the standard protocols like distancing, like sanitation tools in the plant. We have changed all the regular schedules for breaks and lunches in order to not have our people concentrated in one place. We have -- everybody is using sanitizing masks. And we are assuring that all the operations have continuity.

So far, we don't have any of our team players in Mexico, contracted the virus, but we know that we have third parties that work for us that have been -- that have been with a virus. Now all -- we have all those protocols about if somebody feels that they have to go home and we measure them, we take temperatures in all our facilities. So we feel comfortable with all the measures that we have taken in our facility in order to contain spreading and to monitor it.

Now that is not the same situation at our MegaMex facilities in the U.S. As you may be aware, the plant shut temporarily this week for 2 weeks because we have more than 20 cases of infections. So in that case, we are -- we temporarily shut. And then it will be a little bit of a slow start going forward.

So I don't know if that answers your question. On how are we doing in our plant. Now the first one is a little bit longer because you are right. We feel very comfortable with our balance sheet. And I think that, that is a strength that we have coming into a crisis.

On the foodservice space, no, we are not looking at that space. I think that our foodservice business in Mexico represents about 5% of our sales. And I think that's a very -- it's a very good business, but we are not in that because we are in the brand and marketing and building strong brands. So our spaces, our interest are in that space.

In terms of the United States, there's also some opportunities, but also not in the foodservice space. I hope that answers both questions.

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Felipe Ucros Nunez, Scotiabank Global Banking and Markets, Research Division - Analyst [11]

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I think I misspoke because I think I said foodservice, and I meant to say restaurants. Well, I mean, some people use them interchangeably. But I was noting if you're looking at anything in that space.

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Gerardo F. Canavati Miguel, Grupo Herdez, S.A.B. de C.V. - CFO & CEO of the Frozen Division [12]

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No. No. No. We are -- our retail business is more specialized, and it has to be more about strong brands that have facilities or stores. But no, we're not looking to that. We have had a lot of -- we helped a lot of the industry of the restaurant industry now that all the people are unemployed. But no, we don't have any interest in having restaurants. We have kept serious, but not a restaurant.

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Felipe Ucros Nunez, Scotiabank Global Banking and Markets, Research Division - Analyst [13]

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Great. And then we have my other question was a follow-up on the plants. Obviously, you've gone through the experience of having to shut down a plant temporarily for 2 weeks. Is there a contingency plan in case that happens in another plant? Like are you prehiring extra plant workers? So you have kind of 2 workforces? Or anything similar to that to avoid shutdowns? Or to avoid partial shutdowns?

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Gerardo F. Canavati Miguel, Grupo Herdez, S.A.B. de C.V. - CFO & CEO of the Frozen Division [14]

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Well, obviously, we have all the protocols because we have -- we have that experience, but we are not hiring more people if we have another shutdown. It's more about our inventory, and that's why we are at full capacity right now in order to rebuild our inventories that have been depleted because of this extraordinary demand.

But no, we are not hiring more people in case we have another shutdown.

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Operator [15]

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Our next question comes from Jafar Rizvi with Harding Loevner.

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Jafar Rizvi, Harding Loevner LP - Partner, Portfolio Manager & Analyst [16]

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Could you please repeat the cash and the debt situation right now? And also, if you've done any stress testing on the leverage ratios, like net debt-to-EBITDA, and what the stress tests are telling you?

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Gerardo F. Canavati Miguel, Grupo Herdez, S.A.B. de C.V. - CFO & CEO of the Frozen Division [17]

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Andrea, can you please take that one, please?

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Andrea Amozurrutia Casillas, Grupo Herdez, S.A.B. de C.V. - Head of Corporate Finance, Treasury & IR [18]

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Yes. We have cash of MXN 4.2 billion at the end of the quarter. That considers BRL 1.5 billion of disbursements from our committed line and also includes the sale of the tuna vessel.

So in the case of our interest-bearing liabilities, we have BRL 10.5 billion, but that considers the IFRS 16 of leases. And the leverage ratios are net debt-to-EBITDA of 1.5x.

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Gerardo F. Canavati Miguel, Grupo Herdez, S.A.B. de C.V. - CFO & CEO of the Frozen Division [19]

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Let me complement on what Andrea's saying and your stress test. Yes, we do stress. And probably, we do a lot of stressed analysis because we consider a cash EBITDA, first; and second, we do it without cash.

So our stress are in terms of sensibility in our cash EBITDA. That would be subtracting the IFRS 16 and not considering our cash in hand. Okay?

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Operator [20]

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Our next question comes from Alan Alanis with Santander.

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Alan Alanis, Santander Investment Securities Inc., Research Division - Head of Mexico Strategy and Sector Head for Food & Beverage [21]

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I hope you or your families are well. I have a few questions. The first one has to do with the wholesalers. I mean I think about almost 1/3 of your sales go to wholesalers. How much of that product ends up in restaurants? That would be the first question to try -- I'm trying to get to what the total exposure you have to restaurants and foodservice.

The second question has to do with your profitability. You mentioned that it was affected at the cost of goods sold because of an unfavorable mix. But we're seeing Mexico food inflation, I mean, running faster than the rest. And I wonder, what do you expect in terms of cost of goods sold inflation going forward? Again, it's a question around profitability.

And my last question has to do with your exports. I mean with this weakness of the Mexican peso, what's the size of the opportunity for you to accelerate the exports and use that as a lever for growth?

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Gerardo F. Canavati Miguel, Grupo Herdez, S.A.B. de C.V. - CFO & CEO of the Frozen Division [22]

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Same to you, Alan. Okay. So first, we don't have a number on what percentage of our wholesalers go to foodservice. Probably, there's some. But what I can tell you is that we haven't seen any account receivable deterioration in that segment. Most of them are doing DSD. And a lot of the big ones are doing -- are doing -- they all -- they have some stores. All right? So we don't see that.

What we have done -- and obviously, our foodservice division has seen dropped -- sales have dropped dramatically, is that we are giving our customers more time to pay their accounts receivables, okay? Because obviously, they don't have any income right now. So we are extending our credit terms in order to have -- to help them recover this crisis.

In -- and we're also doing that with our franchises in the retail business.

Now on the exports, remember that we don't register in our accounting of MegaMex. So our exports that are 7% of our sales are mayo and all the salsas and guacamole that MegaMex sales. They are doing very good in terms of sales, in salsas, but we don't see a big opportunity on this in increasing a big volume. I think that the salsas, the Herdez salsa, is growing double digits in that environment. And there's obviously a benefit in price that we will invest in marketing if we get it. But we have other gaps versus our plans in MegaMex, as Andrea was mentioning food away-from-home and Don Miguel.

So I wouldn't expect a big increase in exports, not [increased]. And you have a third question?

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Alan Alanis, Santander Investment Securities Inc., Research Division - Head of Mexico Strategy and Sector Head for Food & Beverage [23]

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Yes. The question has to do with profitability. And here's what's behind the question. Basically, regarding cost of goods sold. I mean a lot of your products -- I mean we're seeing inflation of food moving ahead of -- and agricultural products ahead of general inflation. So I'm just wondering how much time in advance? What is your purchasing practices in order to protect your gross margins?

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Gerardo F. Canavati Miguel, Grupo Herdez, S.A.B. de C.V. - CFO & CEO of the Frozen Division [24]

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Okay. We're going to see input inflation, definitely, because of the peso collapse. There's -- we generally say that half of our COGS is dollar-denominated, and that is completely true that we pay in dollars. But there's other parts like 1/3 more that is peso-related even though is -- sorry, dollar-related even though it's peso-denominated, and that's where we're also going to see some cost pressures.

So ballpark, 2/3 of our costs are dollar-related, okay? And we do not expect any price actions right now. I think we believe it's not appropriate. We're not discussing it often.

So our profitability will deteriorate this year in terms of gross margin. It's going to offset a little bit with volume. I'm talking about Preserves. And yes -- and we would revaluate the situation in the fourth quarter of the year, towards the last part of the year when this crisis is a little bit over, then we can have discussions on pricing in order to establish the margins, as you mentioned. But do not expect any price actions right now.

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Operator [25]

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Our next question comes from Álvaro García with BTG.

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Álvaro García, Banco BTG Pactual S.A., Research Division - Research Analyst [26]

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Nice hearing from you, and I hope your families are well. I have several questions as well. Maybe starting on the retail front in Mexico. I was wondering, just to give us a better idea of how you're sort of limiting the cash drain, given that all stores are closed, all the business stores are closed. Maybe how discussions with landlords are progressing and whether or not -- how can we expect that cash range to evolve given the store closures we've seen in April? That would be my first question.

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Gerardo F. Canavati Miguel, Grupo Herdez, S.A.B. de C.V. - CFO & CEO of the Frozen Division [27]

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Same here, Álvaro. Same to your family. So refraining, the question would be, how is the cash constraint in the retail business? As I understood it.

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Álvaro García, Banco BTG Pactual S.A., Research Division - Research Analyst [28]

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Yes. How much are you paying rent right now? And what percentage of your locations are you paying rent? Are you paying your employees? Et cetera.

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Gerardo F. Canavati Miguel, Grupo Herdez, S.A.B. de C.V. - CFO & CEO of the Frozen Division [29]

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Yes. Okay. All right. I'm going to be a little limited on the answers because there's a lot of pool of companies that are my landlords. Okay?

So first and top of all is the wellness of our people. So all our people went home, having full salary and benefits. And they have been taking training courses on product, on service, on protocols, from home.

Second, yes, we have been in extremely high conversations, sometimes 2 or 3 times a week, with all our landlords in order to negotiate with them something that can work for both. As of today, we have had very good negotiations with them, not in favor of one party. I think this is a crisis, and everybody has to put some money on the table.

So 2/3 -- as of yesterday, we have agreed 2/3 with all our landlords. We feel comfortable with our negotiations, and we feel, honestly, that our relationship with the landlords is going to be better than ever.

So we are forecasting -- and I don't want to talk about forecasting because I said it's very difficult, but we are expecting to be closed in May, also. And we definitely think that the lockdown is going to be lifted for June 1 because the hit in the economy is extremely difficult. And we are expecting a very slow recovery, probably 50% for June now.

This is not an official forecast because it's -- I'm just guessing what are we going to do. So the cash drain is very significant for the next 3 months, and then we expect a slow recovery because we will be constrained by the disposable income shortfall of the people.

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Álvaro García, Banco BTG Pactual S.A., Research Division - Research Analyst [30]

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And just -- are all your retail stores closed as well?

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Gerardo F. Canavati Miguel, Grupo Herdez, S.A.B. de C.V. - CFO & CEO of the Frozen Division [31]

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All our retail outlets have been closed since April, everything. And...

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Álvaro García, Banco BTG Pactual S.A., Research Division - Research Analyst [32]

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I just wanted to confirm.

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Gerardo F. Canavati Miguel, Grupo Herdez, S.A.B. de C.V. - CFO & CEO of the Frozen Division [33]

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Yes. Yes. Yes.

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Álvaro García, Banco BTG Pactual S.A., Research Division - Research Analyst [34]

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I have one more -- I have -- I don't know if you're going to make another comment on retail. I had another follow-up on MegaMex.

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Gerardo F. Canavati Miguel, Grupo Herdez, S.A.B. de C.V. - CFO & CEO of the Frozen Division [35]

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Shoot.

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Álvaro García, Banco BTG Pactual S.A., Research Division - Research Analyst [36]

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On MegaMex, I was wondering if you could remind us what percentage of your business goes to foodservice. And then I was wondering if you can -- you mentioned the plant closure. What percentage of your product is at risk on the back of that blank line?

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Andrea Amozurrutia Casillas, Grupo Herdez, S.A.B. de C.V. - Head of Corporate Finance, Treasury & IR [37]

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It's around 20%. 20%.

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Álvaro García, Banco BTG Pactual S.A., Research Division - Research Analyst [38]

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That is foodservice?

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Gerardo F. Canavati Miguel, Grupo Herdez, S.A.B. de C.V. - CFO & CEO of the Frozen Division [39]

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You hear me?

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Andrea Amozurrutia Casillas, Grupo Herdez, S.A.B. de C.V. - Head of Corporate Finance, Treasury & IR [40]

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Yes.

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Gerardo F. Canavati Miguel, Grupo Herdez, S.A.B. de C.V. - CFO & CEO of the Frozen Division [41]

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All right. So let me rephrase your question. The lockup, the temporary shutdown is on the whole plant of Don Miguel, all right? So Don Miguel should be probably about 20% of sales, okay? And foodservice should be something about 10% or 15%, something in that range or food away from home.

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Álvaro García, Banco BTG Pactual S.A., Research Division - Research Analyst [42]

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And that's mainly salsas, right, the foodservice?

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Gerardo F. Canavati Miguel, Grupo Herdez, S.A.B. de C.V. - CFO & CEO of the Frozen Division [43]

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No. No. No. Food away from home is mainly guacamole. It's Wholly Guacamole.

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Álvaro García, Banco BTG Pactual S.A., Research Division - Research Analyst [44]

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Okay. Yes. Wholly Guacamole. Okay. Then I guess just one last one. I'll get back in the queue as well. But just on avocado prices, it's uncharted territory. Obviously, seeing an increase this time of year. How would you rate seeing these sort of increases in avocado prices at this time of the year? And what do you expect on the pricing front relative to when you usually see it in the summer?

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Gerardo F. Canavati Miguel, Grupo Herdez, S.A.B. de C.V. - CFO & CEO of the Frozen Division [45]

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Yes. I mean we saw avocado prices increases, and I think that this is more about the media. Growers left avocado on the trees, but we expect the price to fall significantly right now.

So probably, the cost was ahead of our budget. We had a higher cost, but we expect that to reverse going forward.

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Operator [46]

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Our next question comes from Felipe Ucros with Scotiabank.

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Felipe Ucros Nunez, Scotiabank Global Banking and Markets, Research Division - Analyst [47]

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I think both of my questions were asked by Álvaro. So I think I'm all set.

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Operator [48]

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This concludes the question-and-answer session. I would like to turn the conference back over to the presenters for any closing remarks.

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Gerardo F. Canavati Miguel, Grupo Herdez, S.A.B. de C.V. - CFO & CEO of the Frozen Division [49]

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Okay. Thank you for your participation on the call today. We look forward to speaking with you again next quarter. And please do not hesitate to contact us in the interim.

Thank you, Anastasia. Have a good day.

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Operator [50]

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This concludes today's conference call. You may disconnect your lines. Thank you for participating, and have a pleasant day.