U.S. Markets closed

Edited Transcript of MMGRb.ST earnings conference call or presentation 25-Oct-19 9:00am GMT

Q2 2020 Momentum Group AB Earnings Call

STOCKHOLM Oct 29, 2019 (Thomson StreetEvents) -- Edited Transcript of Momentum Group AB earnings conference call or presentation Friday, October 25, 2019 at 9:00:00am GMT

TEXT version of Transcript

================================================================================

Corporate Participants

================================================================================

* Niklas Enmark

Momentum Group AB (publ) - Executive VP & CFO

* Ulf Lilius

Momentum Group AB (publ) - President & CEO

================================================================================

Conference Call Participants

================================================================================

* Karl-Johan Bonnevier

DNB Markets, Research Division - Analyst

================================================================================

Presentation

--------------------------------------------------------------------------------

Operator [1]

--------------------------------------------------------------------------------

Ladies and gentlemen, welcome to Momentum Group AB's Q2 report 2019/2020. Today, I'm pleased to present CEO, Ulf Lilius; and CFO, Niklas Enmark. (Operator Instructions)

I will now hand over to the speakers. Please begin.

--------------------------------------------------------------------------------

Ulf Lilius, Momentum Group AB (publ) - President & CEO [2]

--------------------------------------------------------------------------------

Thank you. Could you please turn to Slide 2? First, I would like to say welcome to our web meeting, presenting our interim report for our first 6 months of the 2019/'20 financial year, together with my colleague, Niklas Enmark, Executive Vice President and CFO.

So we turn to Slide 4. We will go through some highlights during the quarter. The industrial market in Sweden and Norway continued to display stable performance during the second quarter of the financial year. In Finland, we could sense a little bit weaker sentiment in some customer segments. Also, we continue to improve our efficiency and profit, which resulted in an increase in EBITA of 11% to SEK 80 million, compared to SEK 72 million previous years as well as improving our cash flow. Decentralized responsibility with increased coordination in conjunction with acquisitions is the focus of the rest of the financial year in order to improve EBITA compared to last year.

Slide 5, please. As I mentioned, the overall business situation has been quite stable and we have an increased operating profit in the quarter even though the revenue decreased slightly for comparable units in local currency.

In general, the business noted a more restrained customer activity, especially in August, and it looks like the holiday period was more extended than usual. Some of this was compensated for in our figures in September, but we feel that activity level among customers is characterized by a more cautious attitude than before the summer.

I'm pleased to see the positive earnings trend in TOOLS Sweden created by efficiency gains as well as gross margin improvements, and the integration of the acquisitions made in Momentum Industrial has helped to increase their sales as well as their earnings in the quarter. Our operating margin increased compared to last year and the profit increased by 10%. In EBITA figures, it was 11%, and the corresponding EBITA margin was 5.6% compared to 5.3% preceding year.

Next slide, please. For the business area, Tools & Consumables, the sales decreased by 3% organically during the quarter, mainly due to the business's increased focus on selected customer groups and product areas even though acquisitions contributed. We have had a stable demand in Norway, but the start of the quarter in July and August was weaker than normal in Sweden and Finland.

The revenue for TOOLS Sweden decreased during the quarter compared with the preceding year, mainly due to a weaker start to the quarter than normal in July and August as well as the business' increased focus on selected customers groups and product areas and type of [services].

Order intake in September was favorable compared with the preceding year and the improving activities intended to increase profitability, including increased cost efficiency, improve sales promotion and changes in purchases of preceding according to plan and continue to contribute to a higher gross margins in the operations compared with the preceding year.

If you look in Norway, the revenue for TOOLS Norway increased somewhat during the quarter with a favorable trend primarily in the oil and gas sector as well as increased market shares. Efforts to restructure the logistic function by establishing regional logistics hubs in Region East continues, resulting in slightly higher cost for the operations during the quarter.

In Finland, the revenue remained largely unchanged during the quarter compared with the last year. The development of the industrial market in Finland remained sideways during the quarter and the business continued to prioritize customer cultivation in combination with robust cost control. The integration of the personal protective equipments business acquired from Lindström Group has contributed to sales and earnings.

The restructuring work in Gigant is proceeding according to plan and gradually contributing to a reduction in costs and improved operating profit in the unit. The group's niche companies within workwear and promotional products, together, generate revenue of approximately SEK 350 million yearly and contributed positively to the group's earnings performance during the quarter. All in all, for the business segment, the operating profit rose by 12%, corresponding to an operating margin of 3.3% for the business segment.

Components & Services, next Slide 7, please. Sales in the Components & Services business increased by 3% during the second quarter of the financial year. Momentum Industrial noted favorable revenue growth in all product areas and services with a high activity level among many existing customers. Aided by the acquisition of ETAB for the quarter, Momentum operating margins was around 13%. For the business area, the operating profit rose by more than 12%. The focus of the business area, Components & Services, during this year will be profitable growth, both organic and acquired.

We turn to Slide 8 and we can go through the reporting period. The aim for us within the group is to create increased shareholder value over time by giving each businesses better opportunities to develop based on its own conditions, and the first 6 months of the current fiscal year have been no exception. The reporting period has been eventful and our development has been positive. With the spin-off, we're continuing to take an important step in the improvement journey for long-term sustainable profitability, and earnings performance has been positive every quarter.

For Momentum Group, as a whole, EBITA has increased by 6%. At the same time, we have improved our operating cash flow through the activities implemented to optimize the group's funds tied up in working capital. But of course, we have more to prove in the future and that is what we will continue to work for with focus on decentralized responsibility in conjunction with increased coordination, primarily within TOOLS business.

If we turn to Slide 9, my colleague, Niklas, will give you some comment about the cash flow.

--------------------------------------------------------------------------------

Niklas Enmark, Momentum Group AB (publ) - Executive VP & CFO [3]

--------------------------------------------------------------------------------

Thank you, Ulf. My name is Niklas Enmark, I'm CFO at Momentum Group. And as Ulf mentioned, we have a strong focus on the cash flow with the ambition that the cash flow generation in our existing businesses can and will support our continued growth through acquisition on small to midsized companies, but also to fund our development-oriented investments.

Positive to note, our cash flow from operations increased to SEK 128 million in the last quarter with the positive related working capital. In the reporting period, this number amounted to SEK 202 million. Comparisons to last year, it's of course somewhat whopping as to this year had positive effects from account -- change in accounting principle in total SEK 122 million plus for the period and positive SEK 7 million for the last quarter. However, also adjusted for this, we see that we had a positive cash flow from all operating entities for the period, which marked somewhat of a change from historical period where we normally have a weaker cash flow for the first half of the year, such as last year.

If you turn to Page 10, you can see some selected key ratios. And as Ulf mentioned, our cost expansion measured on EBITA level was 11% for the second quarter reporting period, EBITA increased by 6% to SEK 155 million, compared to SEK 146 million the previous year. Related to our other external financial objective, our return on equity, that stood at 18% and measured on rolling 12-month basis.

Looking at our internal profitability ratio of profitable working capital, that reached 25% for the period. And this ratio is based on 2 components, basically, the EBIT margin and our working capital turnover, both of which was at level of 5% for the period.

And as you can see, we have also added the EBITA levels and the EBITA margins in the table. This is, of course, due to the fact that as we continue to grow via acquisitions, EBITA -- EBIT levels will be increasingly affected by amortization and acquisition-related immaterial assets.

Our financial position is strong with operational net loan liabilities of SEK 349 million. The increase during the year is due to dividends paid during the period, but also due to acquisitions.

And as a note, I can also just comment that the financial net loan liability in the table includes the effect from IFRS 16 adjustments, whereas our operational net loan liability does not.

Handing over to you, Ulf.

--------------------------------------------------------------------------------

Ulf Lilius, Momentum Group AB (publ) - President & CEO [4]

--------------------------------------------------------------------------------

Thank you, Niklas. If we turn to Slide 12, I will take you through the focus in the short to medium term, and this is the same 3 key elements that we have focused on since the spin-off.

And of course, as market conditions vary, we have to adapt and adjust our operations accordingly, which is executed by our close cooperation with our customers. So our overriding focus is still concentrated on change and improvement initiatives in TOOLS, continued development and establishment of niche offerings in current operations, and as a third, of course, acquisition-driven growth strategy with focus on niche acquisitions.

If I give you some comments on the first one, change and improvement in TOOLS. Of course, we are focusing on changing and improving TOOLS and streamlining sales by focus on increasing the number of customer visits. In our offering, we are moving again the core assortment as well as purchase direct from producers due to the development of logistic capabilities. In logistics, we have established a center warehouse for TOOLS in Sweden and Finland, and we are now implementing a regional hub in Oslo that will serve primarily as the first agenda, 50% of our sales units in Norway.

The fourth initiative is to continue to adopt our local presence. We will continue to optimize our local presence for TOOLS in the Nordics to change and streamline local sales outlets focused on industrial customers.

Our customer focus is primarily, again, industry, civil engineering and construction and the public sector. This means that we also adapt assortment for these customer segments and large logistic setup. This will enable us to have a clearer and cost-effective logistic offering and purchasing as well as sales effectiveness.

We will continue to work with focus on decentralized responsibility in conjunction with increased coordination. For example, in logistic and purchasing.

And the second one, continued development of establishment of niche offerings. Of course, we will continue to strengthen us in our concept within occupational health and safety, primarily in TOOLS and the workwear companies, and increase operational safety for industrial customers in Momentum Industrial, which was also contributed by the acquisition of ETAB.

So if we turn to Page 13, Niklas will go through some of the acquisition we made since the spin-off.

--------------------------------------------------------------------------------

Niklas Enmark, Momentum Group AB (publ) - Executive VP & CFO [5]

--------------------------------------------------------------------------------

Right. And that's a third cornerstone of our strategic focus is envision and to grow the group through acquisitions. From the start, as a separate company, our efforts have been dedicated towards a selective M&A strategy with a purpose to support the transition of TOOLS, broaden our offering within the existing businesses and to add new interesting and profitable companies to the group. And if you -- as you see on Page 13, over the course of these last 2 years, we have concluded 11 acquisitions with some SEK 650 million in annualized revenue.

If you turn to Page 14, you see that this acquisition can then be put into the strategic focus areas that we work with. And supporting the first strategic focus, change and improvements in TOOLS, we have made the acquisitions of 2: Knut Sehlin in Sweden and also TOOLS Løvold in Norway. Løvold being one of the remaining partners in Norway. In line with our second strategic focus, continued development and establishment of niche offerings in current operations, we have made some acquisitions, and the last one was done, as was mentioned, the acquisition of ETAB, a market-leading player within industrial hydraulics in Sweden.

We have also started building a new group of companies, working in the field workwear and promotional products through niche acquisitions of TriffiQ, Profilmakarna and Reklamproffsen and also, a couple months of back, Company Line, which together with our own previous company, Mercus, is now near SEK 400 million in revenue profitability.

We will continue to work with our initiatives in M&A. We have established a strong pipe of plus-50 companies, where the ambition is to have ongoing discussions with a handful of candidates at any given time. And as we have mentioned before, we look for profitable companies with a strong local market position that can be further developed. We target companies that have a clear end customer focus in the Nordics.

--------------------------------------------------------------------------------

Ulf Lilius, Momentum Group AB (publ) - President & CEO [6]

--------------------------------------------------------------------------------

Yes. If we turn to Slide 15.

Of course, these 3 main focus in the short to medium term, change and improvement initiative in TOOLS, continued development of niche offerings and acquisition, is to, of course, to reach our financial targets. And its earnings growth of at least 15% annually over a business cycle and as Niklas mentioned, be more and more measured in EBITA due to the effect of the amortization of the companies we buy.

Profitability is achieved. Return on equity of at least 20%, and that is, of course, combined with internal target of profitable working capital of at least 45%. And of course, also in conjunction with our dividend policy of 30% to 50% of earnings per share over business cycles.

So if I will give you some final words before we open it up for Q&As. In conclusion, our Momentum Group's operating margin has improved since the spin-off and the group's cash flow and financial position are stronger than they have been for a long time. We have a solid foundation to carry out further corporate acquisition and boost the profitability of both our business areas through the improvement that was implemented within the group. Therefore, we will continue to take action in each company, based on their unique situation and opportunity. And our aim for the rest of financial year is for all operations to continue improving their profitability and find the correct combination to reach our internal profitability goal of profitable working capital, larger than 45%. Decentralized earnings responsibility and coordination within TOOLS combines with customer proximity remain a high priority in our daily work.

So please turn to Slide 16 and open up for some Q&A.

================================================================================

Questions and Answers

--------------------------------------------------------------------------------

Operator [1]

--------------------------------------------------------------------------------

(Operator Instructions) We received the first question. If you could briefly introduce yourself?

--------------------------------------------------------------------------------

Karl-Johan Bonnevier, DNB Markets, Research Division - Analyst [2]

--------------------------------------------------------------------------------

This is Karl-Johan Bonnevier, DNB Markets. A couple of questions, if I may. And then if I'm the only one in the queue, I might make use of it. So looking at Sweden, first, and also this change and improvement program they are doing, looking at the decrease of 7% in the quarter, how much of that would you say is related to this optimization of product ranges and you walking away from volumes rather than, say, striving to keep everything?

--------------------------------------------------------------------------------

Ulf Lilius, Momentum Group AB (publ) - President & CEO [3]

--------------------------------------------------------------------------------

Yes. I would say most of it, I mean, maybe 80%. But then, of course, you gain some contracts and you lose some contracts customers in -- during the period.

--------------------------------------------------------------------------------

Karl-Johan Bonnevier, DNB Markets, Research Division - Analyst [4]

--------------------------------------------------------------------------------

When you look at that process for TOOLS Sweden, is it something that you are now accelerating again? Or is it something that is coming towards the end of all of this pruning that you have talked about?

--------------------------------------------------------------------------------

Ulf Lilius, Momentum Group AB (publ) - President & CEO [5]

--------------------------------------------------------------------------------

It's coming to the end, but of course, we have more to do, core assortment and of course, where we get products for the customers that they ask us to get for them.

--------------------------------------------------------------------------------

Karl-Johan Bonnevier, DNB Markets, Research Division - Analyst [6]

--------------------------------------------------------------------------------

So if you look at -- just coming back to -- what I try to get -- grasp an understanding of is the -- as you saw the -- a little of an acceleration in the decline in TOOLS Sweden, again, in Q2 compared to at least what you have seen in the last 2 quarters. I guess the feeling was that you were coming towards the end of the pruning, but do you feel that we are taking a next step here so should we expect these kind of declines to continue as you optimize the product range?

--------------------------------------------------------------------------------

Ulf Lilius, Momentum Group AB (publ) - President & CEO [7]

--------------------------------------------------------------------------------

Yes, some decline, but that, of course, will help us to increase the EBIT level. I mean TOOLS Sweden is the company within TOOLS that has made the most accelerating on the EBIT level during the quarter and during the year. So...

--------------------------------------------------------------------------------

Karl-Johan Bonnevier, DNB Markets, Research Division - Analyst [8]

--------------------------------------------------------------------------------

Exactly. There's always communication about this, I guess.

--------------------------------------------------------------------------------

Niklas Enmark, Momentum Group AB (publ) - Executive VP & CFO [9]

--------------------------------------------------------------------------------

Sorry, can I just comment on that? As we mentioned in the report, I think one important thing to remember is that we actually saw quite a holiday effect in Sweden in the first couple of months, July and August, where we actually had -- was quite lower activity level, and that ramped up in September time. So we had seasonality effects during this period that was more sort of accentuated for TOOLS Sweden than, basically, any other company I would say also.

--------------------------------------------------------------------------------

Ulf Lilius, Momentum Group AB (publ) - President & CEO [10]

--------------------------------------------------------------------------------

That's true.

--------------------------------------------------------------------------------

Karl-Johan Bonnevier, DNB Markets, Research Division - Analyst [11]

--------------------------------------------------------------------------------

Excellent. Just to fully grasp that then, if we look into the second half of the year, obviously, we don't know where PMI and all those kind of effects will take us, but when you look at the effective measures that you're doing in-house, taking out volumes that you don't feel that you are supposed to do long term, are we coming towards the end of that? Or is there still a lot of time to go for it?

--------------------------------------------------------------------------------

Ulf Lilius, Momentum Group AB (publ) - President & CEO [12]

--------------------------------------------------------------------------------

We're coming to the end of that.

--------------------------------------------------------------------------------

Karl-Johan Bonnevier, DNB Markets, Research Division - Analyst [13]

--------------------------------------------------------------------------------

Excellent. Looking at the inventory you have in Norway, you indicated there were still some excess costs coming in, setting up that structure. But obviously, it was quite a good decrease compared to the effect you saw in Q1 on that. Do you see, also going into the second half of the year, are we coming through this and now you're -- it's supposed to be, I'd say, more of inefficiency than -- generated than costs -- a short-term cost problem?

--------------------------------------------------------------------------------

Ulf Lilius, Momentum Group AB (publ) - President & CEO [14]

--------------------------------------------------------------------------------

Yes. We will close the project at the end of December. The project has been prolonged and it's due to a couple of reasons. One reason is that we decided to extend with VMI -- VMA solution and some automatization in the warehouse. So we're investing in those 2 things and that prolonged the project, but it also gives us an opportunity to serve more larger region then we were from the beginning.

And the second is that the logistic director and responsible manager for the logistic hub left the company. So we got some new persons to drive the project. So now it's upcoming and we will also, of course, during this time, make some adjustment within the ERP, so it will not be possible locally to do some things that they have been able to do before, in order to make them to use the hub.

--------------------------------------------------------------------------------

Karl-Johan Bonnevier, DNB Markets, Research Division - Analyst [15]

--------------------------------------------------------------------------------

Excellent. Then just coming back to, say, more of a general feeling. Obviously, we have seen PMI statistics going down quite dramatically in -- at here in our state, and those numbers are volatile. But how do you see those correlating with your own business sense, so to say, out there? And what you are seeing from customers and in your discussions?

--------------------------------------------------------------------------------

Ulf Lilius, Momentum Group AB (publ) - President & CEO [16]

--------------------------------------------------------------------------------

It's mixed. It's more, I would say, sideways feelings we've got. But of course, some segments is up and some was down. We could feel that, of course, mining and construction and automotive has been down, but we could see strong numbers in September. But we could see a small decline in pulp and paper segment, for example. So -- and the food and beverage is doing pretty well. So it's mixed -- mixed signals, mixed in different countries, but still somewhat sideways from a high level.

--------------------------------------------------------------------------------

Karl-Johan Bonnevier, DNB Markets, Research Division - Analyst [17]

--------------------------------------------------------------------------------

And when we look at Components & Services in this respect, I guess, they seem to have a fantastic business environment for themselves out there for the moment, looking at the margins level here. You've managed to get out of it, and it also looks like your M&A transactions in that space has really come up and now delivered up to their full potential if we're looking at the Brammer transaction, these kind of things. Is that the right kind of perception of it?

--------------------------------------------------------------------------------

Ulf Lilius, Momentum Group AB (publ) - President & CEO [18]

--------------------------------------------------------------------------------

Yes, it is. And also, the last acquisition of ETAB, which is a niche specialist within hydraulics, and we have a supplier partnering up with who wants us to be doing more of that in -- all over Sweden. So we're also accelerating that partnership with them.

--------------------------------------------------------------------------------

Karl-Johan Bonnevier, DNB Markets, Research Division - Analyst [19]

--------------------------------------------------------------------------------

And when you're looking at expanding into the other geographies in the space, do you have any new openings there?

--------------------------------------------------------------------------------

Ulf Lilius, Momentum Group AB (publ) - President & CEO [20]

--------------------------------------------------------------------------------

Yes. We have actually started to -- made a geographical expansion in Norway, and we start -- we have started in the Oslo area. So we said don't -- let's start all over Norway. If we can't be good in the Oslo area, we can't be good in Norway. So we do need more the Japanese way, taking some local geography, be good, and then we expand from that.

--------------------------------------------------------------------------------

Karl-Johan Bonnevier, DNB Markets, Research Division - Analyst [21]

--------------------------------------------------------------------------------

And when you look at the Norwegian market opportunity, obviously, starting in Oslo, then over time, I guess, this area should have the same kind of relative potential as you have seen in TOOLS and Tools & Consumables for the Norwegian TOOLS change, yes?

--------------------------------------------------------------------------------

Ulf Lilius, Momentum Group AB (publ) - President & CEO [22]

--------------------------------------------------------------------------------

I didn't really get -- what do you mean by that?

--------------------------------------------------------------------------------

Karl-Johan Bonnevier, DNB Markets, Research Division - Analyst [23]

--------------------------------------------------------------------------------

If you look at the long-term potential you're getting from Momentum Industrial into Norway in a proper way. I guess TOOLS Norway is the biggest part of the TOOLS chain at this stage. Is it the same kind of opportunity, relatively speaking, than you're looking at the Momentum Industrial?

--------------------------------------------------------------------------------

Ulf Lilius, Momentum Group AB (publ) - President & CEO [24]

--------------------------------------------------------------------------------

No. I would actually say, yes, as some (inaudible) which I know, if you take the Swedish market, the Norwegian market in components services is half of that due to the industry. And I would say the Finnish market is also half of that. And then you have a little bit less in Denmark. That's kind of that -- how we see on the -- in general the market's perspective.

--------------------------------------------------------------------------------

Karl-Johan Bonnevier, DNB Markets, Research Division - Analyst [25]

--------------------------------------------------------------------------------

And then final question for me. Looking at the cash flow, you obviously, detailed the IFRS 16 impact. But I guess, this kind of business tends to have its best cash flow when volumes are slowing down and you can optimize the inventory and get payables down and so on. Is that what is happening out there for the moment or is it something else driving, say, that part of the equation?

--------------------------------------------------------------------------------

Niklas Enmark, Momentum Group AB (publ) - Executive VP & CFO [26]

--------------------------------------------------------------------------------

No. But you are right, Karl-Johan. I mean in worst times, these types of companies that we represent, of course, have the benefit that we can sort of -- we can pretty rapidly change our buying patterns, which have a positive effect on the working capital. I would say, that, of course, we are more looking at the risks related to the business environment as of now. So we are not taking sort of huge risk when it comes to sort of expanding, rather the contrary, that we are looking at sort of mitigating a possible downturn in economy. But I would say that the major impact that we see in the cash flow generation is basically the work that we've been doing in the companies, working with payment procedures. Also, actual agreement discussions with both customers and suppliers. That's the main reason. And also, working more with optimization on our inventory level. That was bringing down sort of the assortment level -- number of articles in the assortment that we have with. So it's -- and it's the majority around the positive impact that we see right now.

--------------------------------------------------------------------------------

Karl-Johan Bonnevier, DNB Markets, Research Division - Analyst [27]

--------------------------------------------------------------------------------

Excellent. So it's not a cyclical consideration that is coming into that component yet?

--------------------------------------------------------------------------------

Niklas Enmark, Momentum Group AB (publ) - Executive VP & CFO [28]

--------------------------------------------------------------------------------

No, I wouldn't say that. That is not been the major impact that we see, no. No, it's more internal efficiency measures that we have right now.

--------------------------------------------------------------------------------

Karl-Johan Bonnevier, DNB Markets, Research Division - Analyst [29]

--------------------------------------------------------------------------------

And Niklas, just to finalize. Looking at the acquisition pipeline, if we get to slightly slower business environment now for the next say, 6, 12 months or some time, do you think it's going to be easier or more difficult to convert that pipeline into transactions?

--------------------------------------------------------------------------------

Niklas Enmark, Momentum Group AB (publ) - Executive VP & CFO [30]

--------------------------------------------------------------------------------

That's a good question. I think, of course, if we have a downward revision of the economy and that impacts, basically, the business climate of these companies, then, of course, from our perspective, we would like to take that into consideration when we acquire companies.

However, looking over time, of course, the sellers can have a pretty opposite view that they would like to sell based on, basically, historical performances. So there could be, perhaps, sort of a gap related to the view of the company going forward for, like, 6 months before sort of the -- a possible downturn have actually impact in the numbers and also the sort of the perception on the sellers. So I wouldn't say that it's going to be easier, rather, perhaps the contrary, to be honest. But I think that will be pretty short times, say, like over 6 months. And just to clarify, I mean, we are not just looking after M&A into one sector. We are -- we have a pretty broad stroke when we look at the M&A pipe. So we are trying to sort of also work with M&A targets in various sectors and various parts of sort of the business cycle.

--------------------------------------------------------------------------------

Operator [31]

--------------------------------------------------------------------------------

There are currently no further questions. (Operator Instructions) We haven't received any further questions, so I hand back to the speakers.

--------------------------------------------------------------------------------

Ulf Lilius, Momentum Group AB (publ) - President & CEO [32]

--------------------------------------------------------------------------------

Okay. Thank you very much for taking the time to listen to us. And if you have any questions, don't hesitate to contact us. Thank you very much.

--------------------------------------------------------------------------------

Niklas Enmark, Momentum Group AB (publ) - Executive VP & CFO [33]

--------------------------------------------------------------------------------

Thank you.

--------------------------------------------------------------------------------

Operator [34]

--------------------------------------------------------------------------------

Ladies and gentlemen, thank you for your attendance.

This call has been concluded, you may disconnect.