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Edited Transcript of TRAXIONA.MX earnings conference call or presentation 27-Oct-20 4:00pm GMT

·23 min read

Q3 2020 Grupo Traxion SAB de CV Earnings Call Nov 26, 2020 (Thomson StreetEvents) -- Edited Transcript of Grupo Traxion SAB de CV earnings conference call or presentation Tuesday, October 27, 2020 at 4:00:00pm GMT TEXT version of Transcript ================================================================================ Corporate Participants ================================================================================ * Aby Lijtszain Chernizky Grupo Traxión, S.A.B. de C.V. - Co-Founder, Executive President & Director * Antonio Tejedo Obregón Grupo Traxión, S.A.B. de C.V. - VP of Investors Relations * Rodolfo Mercado Franco Grupo Traxión, S.A.B. de C.V. - CEO & Director * Wolf Silverstein Sandler Grupo Traxión, S.A.B. de C.V. - CFO & VP of Finance and Administration ================================================================================ Conference Call Participants ================================================================================ * Andressa Varotto UBS Investment Bank, Research Division - Associate Analyst * Marcos Barreto Guerrero Citigroup Inc., Research Division - Research Analyst * Martín Lara Miranda Global Research - CEO & Founding Partner * Pablo Monsivais Mendoza Barclays Bank PLC, Research Division - Assistant VP & Lead Research Analyst * Ruben López Romero Santander Investment Securities Inc., Research Division - Research Analyst ================================================================================ Presentation -------------------------------------------------------------------------------- Operator [1] -------------------------------------------------------------------------------- Greetings, and welcome to the Traxión Third Quarter 2020 Earnings Call. (Operator Instructions) As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Mr. Aby Lijtszain, Executive President for Traxión. Thank you, sir. You may begin. -------------------------------------------------------------------------------- Aby Lijtszain Chernizky, Grupo Traxión, S.A.B. de C.V. - Co-Founder, Executive President & Director [2] -------------------------------------------------------------------------------- Thank you. Welcome again to Traxión's earnings call. I hope you and your families are safe and healthy. As usual, I will comment on some relevant aspects of the quarter before handing over to Rodolfo, Wolf and Tonio, who will discuss operating and financial figures in detail. I am very excited to share with you that, once again, Traxión delivered solid financial and operating results despite the adverse environment that the contingency has caused. We posted record-high financial figures. Traxión continues to conduct business profitably and efficiently. The company generates cash, has taken advantage of opportunities and serves its clients effectively. This is a result of very hard work and how the company is designed. Surely, the most important highlight this quarter is that Traxión placed a MXN 2.5 billion bond with a 7-year maturity and a fixed rate of 8.98%. The deal was oversubscribed, which I take as an additional vote of trust in Traxión, especially given the current macro landscape. With this issuance, Traxión replaced outstanding credit facilities, extended the overall maturity profile, will improve cash flows and will optimize financing costs. After 3 years of being a publicly-traded company, we have achieved this very important milestone that take us to the next level in terms of financing sources. Moving on to the operational side. As you can see, logistics has become a fundamental element of our business, especially those services related to e-commerce. Traxión has almost tripled both revenue related to this channel and daily handling volumes compared to the same period of last year. Obviously, the contingency boosted such increase. But please bear in mind that e-commerce activity in Mexico was severely underpenetrated before COVID and that people were forced to apply it during the contingency. In general, people have discovered that e-commerce not only works, but is more convenient and efficient for many things. Having said that, we believe that a great portion of this increased volume will remain a hot trend once we go back to normal. Years back, we saw that growth of e-commerce was imminent, of course, not driven by COVID, but by natural market forces. Anyway, Traxión reacted promptly and planned accordingly and has taken a portion of such growth that today represents more than 10% of total revenues. Shifting gears to other business lines. We have a stable quarter in terms of cargo operations. We still move our fleet among sectors, but with much more stability compared to when the contingency started. Our personal transportation segment grew driven by requests for increased capacity that started on the second quarter and continued through the third quarter, driven by social distancing rules. Traxión has saved over demand in this business and has been satisfied by temporarily using the fleet that normally is dedicated to schools and by outsourcing buses with regional competitors that have spare capacity. Speaking about schools, please be advised that the contracts we have with these clients are still valid. And we have granted some discounts in the interest of strong commercial relationships. When schools return to their normal activity, they will let us know in advance so that we balance our fleet, and they can resume their service in a timely manner. With this, I conclude my remarks, and I will hand over to Rodolfo. Please, Rodolfo, go ahead. -------------------------------------------------------------------------------- Rodolfo Mercado Franco, Grupo Traxión, S.A.B. de C.V. - CEO & Director [3] -------------------------------------------------------------------------------- Thank you, Aby. Good morning, everyone. Thanks for your attendance. I will now discuss the most important operating highlights in this quarter. As Aby mentioned, logistic operation now represents a relevant portion of our business, now contributing almost 3x what they did on the same period of 2019. Traxión increased by more than 66% its domestic last-mile capacity, not considering the cross-border e-commerce business that we have developed, which has grown considerably as well. We invested more than MXN 60 million to improve our IT systems. We created [Webtrax], an app that allows better tracking, improves internal processes and provides much more accurate real-time information. It is important to consider that Traxión worked extensively in 2019 to build a robust logistics platform that was launched at the beginning of 2020, which positioned the company in a privileged spot to capture the increasing logistic operating volume that the pandemic brought. Moving on, in terms of innovation, I'm very proud to share with you that, Traxi, our people mobility app launched in July, has now more than 5,000 downloads and operates 10 daily routes with 6 different time tables both in Mexico City and Guadalajara. In this service, we developed an app that monitors and controls riding capacity by using QR codes. In the personnel and student transportation segment, we have conducted an extensive commercial effort, which resulted in a solid growth in new clients and existing ones. Especially during this third quarter, we started operation with 90 new clients that require 130 additional units. Moreover, during September, we operated more than 6,000 units in this segment. This was possible mainly by outsourcing fleet of third parties with spare capacity. All this drove a growth of 15.7% in kilometer volume in this service. So as you can see, we are gaining clients despite of the pandemic situation. Shifting to our cargo business. It remained stable during this quarter. We had an increase in our cross-border business related to auto industry and obtained a license for field transportation, a service that we have developed organically and was kicked off during this third quarter. In terms of expansion, we gained a 5-year contract that will require 49 new cargo trucks for 2021. We also will be adding refrigerated trailers to our fleet to face the growth of this service. Finally, we achieved a 2.3% fuel saving as a result of synergies and new technologies. On the social and environment front, Traxión joined a breast cancer prevention and support program together with a computer recycling campaign to assist child cancer groups. We also obtained a clean transportation certification for the sixth year in a row and renew several quality assurances programs. Having said this, I will now hand it over to Wolf. Please, Wolf. -------------------------------------------------------------------------------- Wolf Silverstein Sandler, Grupo Traxión, S.A.B. de C.V. - CFO & VP of Finance and Administration [4] -------------------------------------------------------------------------------- Thanks, Rodolfo. Hello, everyone. I just want to walk you through the actions we took on the financial front this quarter, especially details of both leverage and CapEx. As you know, we were successful in placing a MXN 2.5 billion unsecured 7-year bond with a fixed rate of 8.98%. With this bond issuance, Traxión gained significant benefits in terms of overall debt profile. This is also part of our plan to continue improving our cost of financing. If we take a look at our debt profile previous to the placement, Traxión had an average maturity of around 2 years. And today, that maturity profile improved significantly after the transaction. Our average maturity is currently of approximately 4 years. In addition to that, our net debt-to-EBITDA ratio decreased from 1.8x pre-bond to around 1.7x after the placement and has further decreased compared to the third quarter of last year when the ratio was 2.16x. Traxión has a much stronger balance, broader financing sources and a very solid cash position, which results in a great financial situation among a very complex macro environment, which place us in a particularly comfortable competitive position. Moving on to details of CapEx. As you see, we reactivated a portion of our CapEx plan by deploying MXN 171 million during the third quarter. More than 70% of that was spent in the personal transportation segment mainly to grow and satisfy requests from both new and existing clients. Moreover, as you know, we deferred a large portion of the original CapEx figure of MXN 1.2 billion for the year. Even though we have exercised strong CapEx during the year by deploying capital to fund business opportunities we have encountered, and we are running well below 50% of the original pre-COVID CapEx figure. The company also has been very active commercially and has been able to seize attractive opportunities during the contingency. Finally, I just want to highlight that Traxión continued generating cash during the quarter and kept executing a strict cost and expense savings program. Having said that, I will hand over to Tonio, who will discuss financial figures in much more detail. Please, Tonio. -------------------------------------------------------------------------------- Antonio Tejedo Obregón, Grupo Traxión, S.A.B. de C.V. - VP of Investors Relations [5] -------------------------------------------------------------------------------- Thank you, Wolf. Hello, everyone. Welcome. As you already saw, Traxión continued with a positive trend over the third quarter and ended with another record-high result. I will now walk you through some financial details before opening the floor to Q&A. Traxión delivered a very strong growth in consolidated revenues of 20.4% to reach MXN 3,774 million, which is by far the highest revenue figure in the history of the company. This was driven by a considerable growth in operating activity of logistics channels and by increased demand in the personal transportation service, which resulted in an expansion of 15.7% in kilometer volume in this segment. Moving on, operating income increased 28.9%, significantly higher than growth of revenues and was mainly driven by strict cost and expense controls implemented back when the contingency started. General expenses grew only 2.5% and showed an efficiency of 280 basis points as a percentage of revenues compared to the same period of 2019. In terms of costs, there was a decrease of 9.1% in average fuel prices compared to the third quarter of 2019, which drove down our overall costs by 15% in fuel. The other operating costs behaved with efficiencies versus growth of revenues. But perhaps the most important item to talk about is the cost of facility services and supplies, which increased 66%, and is where we record the outsourcing of third-party fleets and logistics services, which continued expanding over the third quarter, as we already discussed. Moving on to comprehensive financial results. The fee was somewhat altered by MXN 36 million in refinancing fees, which is a one-off this time. Most relevant here is that interest expense decreased MXN 66 million mainly driven by a lower cost of financing. Furthermore, net income reached MXN 191 million in the period, which is a very impressive growth of 37.7% compared to the same period of last year. But there is something very relevant to highlight. In the first 9 months of 2020, net income is MXN 472 million, which is not only 60.7% higher than the same period of 2019, but also is MXN 21 million more than total net income generated by Traxión last year. And we still have one quarter to go. All that, together with a strict working capital management, drove operating cash flows to grow 47.4% in the quarter and 39.3% in the first 9 months of the year, which is a very healthy figure considering the complex macro landscape and uncertainty we are currently undergoing. Well, thanks for your attention. With this, I wrap up my observations and open the floor to Q&A. ================================================================================ Questions and Answers -------------------------------------------------------------------------------- Operator [1] -------------------------------------------------------------------------------- (Operator Instructions) Our first question comes from the line of Pablo Monsivais with Barclays. -------------------------------------------------------------------------------- Pablo Monsivais Mendoza, Barclays Bank PLC, Research Division - Assistant VP & Lead Research Analyst [2] -------------------------------------------------------------------------------- I have actually 2 questions here. The first one is, you mentioned that e-commerce was 4% of your revenues last year. And right now, they represent 10% of your revenues. But how do you see this segment evolving in the next 2 or 3 years? Do you think that you can reach 20%, 15% or 10% is the rate that it will remain? That's the first one. And my second question is on the EBITDA margin. 22%, I think it's a very good result. But do you expect any additional increase going forward? Or is this already a steady-state profitability level? -------------------------------------------------------------------------------- Rodolfo Mercado Franco, Grupo Traxión, S.A.B. de C.V. - CEO & Director [3] -------------------------------------------------------------------------------- Pablo, this is Rodolfo. Yes, we had a very good year of growing revenues in e-commerce. Now they represent around 10% of the total revenues of Traxión. And for sure, we see this percentage and, of course, the revenue growing in the future years. This is a segment that we are taking a very good look at and pushing our business through that segment. I think we're going to have a very good growth in that part of the business. -------------------------------------------------------------------------------- Pablo Monsivais Mendoza, Barclays Bank PLC, Research Division - Assistant VP & Lead Research Analyst [4] -------------------------------------------------------------------------------- And on the EBITDA margin? Sorry. -------------------------------------------------------------------------------- Wolf Silverstein Sandler, Grupo Traxión, S.A.B. de C.V. - CFO & VP of Finance and Administration [5] -------------------------------------------------------------------------------- Pablo, this is Wolf. Talking about the margins. I think as long as the market conditions prevail, we think that the company should be able to continue posting margins about 20%. However, logistics service post also a lower margin. So if such services gain relevance, as we already mentioned during the last quarters, we think that the consolidated margins could move a little bit. -------------------------------------------------------------------------------- Pablo Monsivais Mendoza, Barclays Bank PLC, Research Division - Assistant VP & Lead Research Analyst [6] -------------------------------------------------------------------------------- Okay. And you said in your earnings results that, yes, logistics has a lower margin but also lower CapEx. So probably on the return to equity or return on assets, how do you see the -- your performance evolving? -------------------------------------------------------------------------------- Wolf Silverstein Sandler, Grupo Traxión, S.A.B. de C.V. - CFO & VP of Finance and Administration [7] -------------------------------------------------------------------------------- I think speaking about both segments, they -- at some point, they compete for all that the company need to deploy in the investment. So we look for the same profitability in many of our segments. So it should be the same anyway. As you mentioned, it will be less CapEx in the logistics side. -------------------------------------------------------------------------------- Rodolfo Mercado Franco, Grupo Traxión, S.A.B. de C.V. - CEO & Director [8] -------------------------------------------------------------------------------- Yes. So the revenues from logistics are, as you mentioned, more profitable because the CapEx is much less. -------------------------------------------------------------------------------- Operator [9] -------------------------------------------------------------------------------- Our next question comes from the line of Ruben López with Santander Bank. -------------------------------------------------------------------------------- Ruben López Romero, Santander Investment Securities Inc., Research Division - Research Analyst [10] -------------------------------------------------------------------------------- Can you hear me? -------------------------------------------------------------------------------- Rodolfo Mercado Franco, Grupo Traxión, S.A.B. de C.V. - CEO & Director [11] -------------------------------------------------------------------------------- Yes. -------------------------------------------------------------------------------- Wolf Silverstein Sandler, Grupo Traxión, S.A.B. de C.V. - CFO & VP of Finance and Administration [12] -------------------------------------------------------------------------------- Yes. -------------------------------------------------------------------------------- Ruben López Romero, Santander Investment Securities Inc., Research Division - Research Analyst [13] -------------------------------------------------------------------------------- Perfect. Congratulations on your results. My first question is a follow-up on the margins. I mean, of course, logistics has a lower margin, but can you share with us what could be a margin for logistics? And what would be the cargo -- the margin for cargo? And I don't know if you can also share with us the ROIC for each of them. -------------------------------------------------------------------------------- Wolf Silverstein Sandler, Grupo Traxión, S.A.B. de C.V. - CFO & VP of Finance and Administration [14] -------------------------------------------------------------------------------- Yes. Speaking about what we expect on the margins in both segments, if you speak about cargo, we're still looking for cargo something around the 20%. And if we look for logistics, there are many things in the logistics side, but It could be something around 9% and 12% margin EBITDA. So that could, at some point -- as I mentioned before, that could kick a little bit the margins for the company. But it doesn't have to kick the ROIC. And speaking about the ROIC, the company is looking always for any investment to have at least 40% of ROIC. -------------------------------------------------------------------------------- Rodolfo Mercado Franco, Grupo Traxión, S.A.B. de C.V. - CEO & Director [15] -------------------------------------------------------------------------------- 14%. -------------------------------------------------------------------------------- Wolf Silverstein Sandler, Grupo Traxión, S.A.B. de C.V. - CFO & VP of Finance and Administration [16] -------------------------------------------------------------------------------- 14%. I don't know if hear me well. -------------------------------------------------------------------------------- Aby Lijtszain Chernizky, Grupo Traxión, S.A.B. de C.V. - Co-Founder, Executive President & Director [17] -------------------------------------------------------------------------------- Well, it's important to notice that the traditional transportation business as cargo or passenger transportation, it's a little bit above 20%. Logistics is under 20%. But the average of the company will be around 20%. We don't expect to be below 20%. -------------------------------------------------------------------------------- Ruben López Romero, Santander Investment Securities Inc., Research Division - Research Analyst [18] -------------------------------------------------------------------------------- Okay. Perfect. And the second one is on the technology side. Can you give us any update on Traxi, Traxporta and Traxión Logistics? I don't know if downloads or active users, anything that you could share with us that could show the development or -- yes, the performance of these tools? -------------------------------------------------------------------------------- Rodolfo Mercado Franco, Grupo Traxión, S.A.B. de C.V. - CEO & Director [19] -------------------------------------------------------------------------------- Yes. Ruben, this is Rodolfo. On the Traxi side, we have around 5,000 downloads right now. And we are operating around 10 routes -- 10 times in 6 routes -- 10 timetables in 6 routes, around that. It's working really well. We have a lot of confidence in this part of the business. The Traxporta part of the section, we are improving every day. We think we have a very good foreseeing of this business. We were checking a lot of options to infiltrate the market. And I think we're going to do it very good in the first quarter of next year. I think the IT part of our technology in Traxión are very good projects that we are pushing every day. And we have -- we are very confident that they will make a good difference in Traxión in the near future. -------------------------------------------------------------------------------- Operator [20] -------------------------------------------------------------------------------- Our next question comes from the line of Martín Lara with Miranda Global Research. -------------------------------------------------------------------------------- Martín Lara, Miranda Global Research - CEO & Founding Partner [21] -------------------------------------------------------------------------------- Congratulations for the very strong results. I have 2 questions. The first one is, why are you keeping the same guidance after 2 record quarters? Isn't it a little bit conservative? And the second one is what can we expect going forward with respect to labor costs and also in terms of facility services and utilities expenses? -------------------------------------------------------------------------------- Wolf Silverstein Sandler, Grupo Traxión, S.A.B. de C.V. - CFO & VP of Finance and Administration [22] -------------------------------------------------------------------------------- Martín, I think, even though we have a record-breaking quarters, there are still several factors we consider before the year-end that could pose additional challenge. For example, like elections in the U.S., the new COVID outbreak in Europe, et cetera. So we try to be a little bit conservative for this. And I think we're still having a great news that the company expects to achieve and maybe to exceed the original guidance in this particular year. -------------------------------------------------------------------------------- Aby Lijtszain Chernizky, Grupo Traxión, S.A.B. de C.V. - Co-Founder, Executive President & Director [23] -------------------------------------------------------------------------------- Martín, and regarding the labor and the facilities, what we expect in the future is that the labor is around 13%, 14% of total percentage of the cost. And I think the facility is around at 20% or 25%. So I think we expect that to maintain this trend to the future. And we will work in retaining this cost and make it not grow. -------------------------------------------------------------------------------- Operator [24] -------------------------------------------------------------------------------- Our next question comes from the line of Andressa Varotto with UBS. -------------------------------------------------------------------------------- Andressa Varotto, UBS Investment Bank, Research Division - Associate Analyst [25] -------------------------------------------------------------------------------- Congratulations on the results. I have 2 questions on my side. The first one is regarding the cost reduction on the passenger transportation segment. We've been seeing margin expansion in the segments, I think, like, 2 quarters ago. So I just wanted to know if this is recurring -- if it's occurring and what can we expect going forward. And my second question would be on the cargo transportation. We are seeing that the segment has been driven more by the logistics and e-commerce services. So while the cargo transportation increased only around 1% in the quarter. So I just wanted to get a sense on how it's being affected by the COVID pandemic. How is it recovering? And what are your expectations? -------------------------------------------------------------------------------- Antonio Tejedo Obregón, Grupo Traxión, S.A.B. de C.V. - VP of Investors Relations [26] -------------------------------------------------------------------------------- Andressa, this is Tonio. Could you please repeat the first question? You didn't -- we didn't hear you clearly. -------------------------------------------------------------------------------- Andressa Varotto, UBS Investment Bank, Research Division - Associate Analyst [27] -------------------------------------------------------------------------------- Sure. The first question is regarding the margin expansion in the passenger transportation segment, if we can expect the cost reduction and efficiencies to be recurring. -------------------------------------------------------------------------------- Antonio Tejedo Obregón, Grupo Traxión, S.A.B. de C.V. - VP of Investors Relations [28] -------------------------------------------------------------------------------- Okay. Yes, you can expect that. We've been doing improvements in terms of both costs and expenses. We've been operating with some leverage as well in terms of in operating terms. And you can expect those margins to continue to be there. Can you repeat your second question, please? -------------------------------------------------------------------------------- Andressa Varotto, UBS Investment Bank, Research Division - Associate Analyst [29] -------------------------------------------------------------------------------- The second question is regarding the cargo transportation segment, specifically, how it's been reacting during the pandemic? And what are your expectations for recovery? -------------------------------------------------------------------------------- Rodolfo Mercado Franco, Grupo Traxión, S.A.B. de C.V. - CEO & Director [30] -------------------------------------------------------------------------------- Andressa, this is Rodolfo. Well, the cargo transportation segment has been not with very highlights in the quarter. It has maintained really good. We, of course, we're expecting to wait until the future comes. Of course, there are some things are -- the COVID is growing in Europe. You know that there's elections in the U.S. So we still have some doubts on how this business will maintain in the future. But for now, it has been really equal -- really stable in the -- in Mexico. -------------------------------------------------------------------------------- Operator [31] -------------------------------------------------------------------------------- (Operator Instructions) Our next question comes from the line of Marcos Barreto with Citi. -------------------------------------------------------------------------------- Marcos Barreto Guerrero, Citigroup Inc., Research Division - Research Analyst [32] -------------------------------------------------------------------------------- I just have the one. Have you taken any cost-cutting measures during the pandemic that you think will stick even after the -- this passes? -------------------------------------------------------------------------------- Antonio Tejedo Obregón, Grupo Traxión, S.A.B. de C.V. - VP of Investors Relations [33] -------------------------------------------------------------------------------- Marcos, this is Tonio. We expect once we go back to normal, we expect a portion of these savings, especially in expenses, to be sustainable beyond COVID. That is as long as market conditions prevail and with similar conditions. But we are not going to be sure until we start going back in all -- until we see that we are actually going back to normal. We don't -- we are not going to be sure. But we know that there are some savings that are sustainable for sure, but there are others that are very uncertain. -------------------------------------------------------------------------------- Operator [34] -------------------------------------------------------------------------------- Our next question comes from the line of [Jorge Lourenco] with Morgan Stanley. -------------------------------------------------------------------------------- Unidentified Analyst, [35] -------------------------------------------------------------------------------- Congratulations for the strong results. My first question is regarding the SG&A line, specifically. I mean it was obviously a positive. So I was just wondering if you could provide more color on whether that was more related to layoffs or maybe temporary labor contract suspensions or online sales on the selling expenses side. That's the first question. And my other question is on the kilometers-driven growth in the pax transportation segment. I just wanted to ask if you still have the same effect that you had last quarter of same clients asking for more buses due to the necessity of maintaining social distancing? Or is that growth coming from other sources now? That's it. -------------------------------------------------------------------------------- Wolf Silverstein Sandler, Grupo Traxión, S.A.B. de C.V. - CFO & VP of Finance and Administration [36] -------------------------------------------------------------------------------- Speaking about the expense side, it's mainly because of what we don't have to exercise this year, mainly, like travel expenses and some other things that the company could renegotiate with the providers. So we can have better conditions in this particular year. So this is why Tonio was saying that many -- most of these savings could remain for after COVID season, and some of them maybe could go to normally -- or back to normally at some point. So we continue with the same personnel -- or the same capacity and personnel that we have before. And we didn't have nobody to hire from the company. -------------------------------------------------------------------------------- Antonio Tejedo Obregón, Grupo Traxión, S.A.B. de C.V. - VP of Investors Relations [37] -------------------------------------------------------------------------------- And quite the contrary, we have been hiring more talent in order to pay growth appropriately. -------------------------------------------------------------------------------- Rodolfo Mercado Franco, Grupo Traxión, S.A.B. de C.V. - CEO & Director [38] -------------------------------------------------------------------------------- Okay, [Jorge]. And regarding -- this is Rodolfo, regarding the transportation segment -- the bus transportation segment, the personnel, we're still having the demand of extra buses. And we see it for the next quarter also, at least for the few -- the next few months regarding the social distancing. As you know, here in Mexico, we still have very good results in the COVID. So a lot of manufacturers are still nervous, so they're still hiring extra buses for their people. It's important to note too that when the contingency is over, those extra buses that we are hiring are going to go work to the schools. -------------------------------------------------------------------------------- Operator [39] -------------------------------------------------------------------------------- We have reached the end of our question-and-answer session. I'd like to turn the call back over to Mr. Lijtszain for any closing remarks. -------------------------------------------------------------------------------- Aby Lijtszain Chernizky, Grupo Traxión, S.A.B. de C.V. - Co-Founder, Executive President & Director [40] -------------------------------------------------------------------------------- Thank you. This year has been extremely complex, and several sectors of the economy have declined significantly over the past 8 months. Despite the pandemic and its adverse effect, Traxión has grown 10 new clients, expanded operations within existing ones, has also made money and remained profitable. We kept 100% of our staff and even hired additional talent to meet our growth needs appropriately. The company has posted record-high figures during the pandemic with a strong balance and a comfortable cash position. This is a result of the business model we have created together with our strong and experienced management team. Thank you, again. Have an excellent week. -------------------------------------------------------------------------------- Operator [41] -------------------------------------------------------------------------------- Thank you. This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation, and have a wonderful day.