CMD 2017

Nov 21, 2017

Slides

So good morning, everybody. Great to be here and share with you all the hard work we've been doing as a company. And we deliberately started with this movie, because for us this is the end of the beginning. It's a new strategy, round up, round it up with a new brand promise, human forward. For many of you who have been following the company for quite a while, we are a value based company. So our founder wrote that as a company, you don't have the right to exist if you don't contribute to society. And our goal in life is to bring people forward, human forward, our clients, our candidates, maybe you, and certainly societies or at least the societies where we're active as a company. And this is for us, at least no small feat because this is 14 years ago that we launched our former promise, which was good to know you. And there's nothing wrong with good to know you, so good to know you. But still, for us, Human Forward is really the positioning we would like to take, which is in between humanity and technology. If there's one thing we've learned in the last 3 years is that technology supports us immensely, but the human touch will still for a long time be important. So it's a promise for us to our stakeholders. So let's see where we are and where we want to take this company. Let me explain this slide to you. On the axis, you see, call it, trades of companies. So personal, traditional authority, tech or algorithm driven and an innovative authority. And we are going to be more data led. So on the top on the bottom left, you'll see the professional players. They are inherently more candidate driven, so they have invested more in technology, but are not data led. The generic players, they are very much personal, still around branches, around human connection, but not data led. The tech players, so the LinkedIns, the Indeeds, but also all the startups we've analyzed are great on tech, but they don't have a client base, they don't have a candidate base. So we are going to use data and I'm going to show you in the afternoon what data is all about. And interesting is that data gives us, as a company, the ability to scale. Just to give you an example, our Singaporean business, which is a very small business, we make 1200 matches a year, but our database is 210,000 profiles big. So we're going to follow these people throughout their working life because they might come in as a temp, They might be looking for a fixed job. They might become a freelancer. And we're not just going to use this data in the branch model. We're also going to use this model into new online fueled models. So again, this is more of an experiment, but we've got many of them. In Singapore, we allow 3 of our big clients to search in our own database because the value of our database as compared to a LinkedIn is these are vetted profiles. We know these people, we've met these people and that's value for our clients. So this means for us that building the company and making the leaps and bounds in growth is not going to go through major acquisitions. So you won't see us buying 1,000,000,000 companies, 1,000,000,000 sized companies to become the leader because data allows us to grow in the combination with our geographical presence. And that's something we're going to show you today. So you know this one. I'm going to spend some time, of course. Yes, we are still confident to get to the 5% to 6%. Robert Jan will show you the steps we're going to take to go into profitable growth again in a different mix than 10 years ago, but absolutely with the potential to get there. And we're very proud of this one and this goes back to human forward. We are a sustainable company. Some of you might know that we're the only company in our sector in the Dow Jones Sustainability Index and we've got an ambition. So by 2,030, we have the ambition to touch 500,000,000 people in their work life. So this will be probably in those, I don't know, still far out, but let's say, dollars 4,000,000 to $5,000,000 get a job. Today it's 2.5 dollars But we have more than 100 projects running across the world for training people, for bringing people back to the labor market. And we think that inherently there's going to be a role for us to play. We have people checking in on our content. We have, of course, our clients, roughly a quarter of a 1000000 clients. So touching 500,000,000 people and it's increasingly tough to know where you are. If you're going to be productive for the next 20 years, if you're 45, what do you need to do? Check-in with us. Check-in with us personally or check our information and our data. So we are very excited about this sustainability goal. So an update, ABFS, Activity Based Field Steering, quite some good results across the board in house. We're going to spend some time, remains a big winner, but also professionals. So our European professionals businesses are all above their respective markets. And you know that wasn't the case a few years ago, so we're very happy. That's not tech. That's just ABFS. That's just performing day to day because that remains very important. Perm doing very well in SME. We're going to spend a lot of time on how we penetrate SME. Some blocks on Org. Productivity, very much handled by Robert Chan, so I won't spend too much time. TTA, so total talent architecture. Rebecca will share with you how we navigate and how we help navigate our clients in an increasingly tough talent space. But still, Rebecca was introduced, but she's our MD of SourceLight, our global business handling big clients. And you see the growth in MSP and you see the growth in RPO, which is definitely above group average. But everything we do and what we've learned is not about the tools. It's about people and performance and leadership. And that's why we have our leaders on stage who drive the business every day and with the use of data, teach their people to work in a new way. And what we've also found is that just going to the top right of the slide, if you just bring in a chatbot or if you just bring a testing model or if you just bring in a profile builder, it won't work. So if we've got some great tools on the right hand side for you, the right hand side, and we bring in more candidates, if you don't touch all the basics, they will never get to the match, to the center. And the same, to a certain extent, goes for our clients. So we won't show you silver bullets. We won't show you quick fixes, but we will show you a journey with very promising results, creating a company that in its entirety doesn't exist in the marketplace and gives us the window to grow and prosper and play our role. You see at the bottom end, end to end measurement and customer experience, 2 very important things. I talked about integrating tools and it needs to be seamless. So your Apple phone, well, call it a phone word, your Apple device, it's so seamless, it's incredible. That's the journey we want our candidates and clients to have. That's honestly speaking not the case yet. Sometimes you need to go from database to database. Chris will say to you that sometimes the Monster load up is 3 seconds or one second. Well, that's at least one second to slow. So getting it seamless and then seamless to people is going to be crucial. So the customer experience and customers decline the candidate needs to be superior. And end to end measurement, we measure everything. So in the room is Joanna Erwin, our new CMO. Hi, Joanna. We measure everything. So marketing is not although we show you quite some nice movies and clips. Marketing is about how do we get from awareness to more matches, where does it go right, where does it go wrong, where does technology help, but also where does the human contribute or where does the human doesn't contribute. So our business, historically, if I would ask you, you would say there's a very low barrier to entry. You just go out, you visit a few clients, they want people, you find them and you're in the business. We think this is going to change. This is a bit of a complicated slide, so I'll spend a bit more time on it. So, tech as a differentiator. Higher barriers to entry favoring big players in a fragmented market. You know our market is fragmented, right? 6% market share, that's what we have. Not yet the world leader, getting close. But there's no value in being the world market leader. There is value in dominating a space, dominating a geography, dominating a job category, where scale and proximity matter. So this is a very interesting thing, scale and proximity. So there are companies that have got scale. LinkedIn's got scale. They got no proximity. So getting that balance right is crucial. So what do you see here? On the top right hand side, the pie charts are around the part of the business with us. And then you see on the axis, you got perm, perm professionals and contingent. And you got small clients and large clients at the bottom from left to right. So the top right is contingent large clients. As you know, we're quite dominant there. This is a space, which from a pricing point of view is commoditizing. So what you need to do here, you need to protect, but at the same time we're attacking. We're attacking through workforce scheduling, which Francois will show you, which will give a new horizon to contingent large clients. Very excited with it and we're also very excited with the immensely fast pace at which this is converting. And you see also the Tech Touch balance. So top right will go way more to Tech. Then we have the bottom right, which is professionals perm large clients. This is a huge space. It's actually a bigger space than the top right. So professionals with large clients is a bigger space than the top right and we're smaller there. Interesting enough, clients have got a big headache in this space. They don't want to work with many suppliers. They've got issues on finding people. They've got issues on keeping people. They've got issues on freelancers, on compliance, on pay rates, on training. And Rebecca will show you how we're helping our clients. Top left, of course, a big space for us still and a growing space. Call it midsize small contingent. So here again, mostly Dominik and Sebastien will show you how we are getting offerings in this space, which will speed up our market share. And at the same time, we're introducing self-service platforms. One of the conclusions we found in the roughly 3 years we've been doing this is it goes slow. So I was with a group of 15 of you a year ago talking about our projections and we said or you asked how fast is this going and we didn't know. But now in France, we connect with Randstad Direct in this space and clients are slow to move. That's okay. We're still going to be leading if this picks up because it will pick up. But clients will still want a traditional offering, that's great. We think they will want a full tech offering also. And then top or bottom left, permprofs, SME space. We think this is a space which is very ripe for disruption. And we told you before, we're going to be disrupting, partly ourselves, but mostly the business. And this is where the high threshold comes in. If you are a small perm player and I don't care which geography, what do you bring to the table? You've got no database. You're one of many who have a LinkedIn license. So where do you get your people from? Because in many spaces, there won't be any active job seekers. So what do you have to sell apart from the fact that you operate at relatively high cost and low speed. So we are going to build models, which will disrupt this space. You won't spend much time on it because welcome everybody at the webcast, you never know who's listening. But this will be a space we're going to disrupt. By the way, the same at the top end on contingent. And we foresee a large consolidation on the right hand side with large clients. So you know we are a growth industry. We've always been a growth industry. On the right hand side, you see bars, which is around penetration rate. So we spent with you quite some time on the fact that many European countries were below record penetration or 2,008 penetration. Well, many of them are back. The Dutch business, the German business had never seen before penetrations. Linda will show with you will show you and demonstrate and talk about the fact that also the U. S. Is at record penetration. And some big winners already in our space, but we feel definitely long term winners also will be Italy, as you can see, at around 1% penetration, going up rapidly and Spain, low. But we're leader there. And we have $1,000,000,000 So it does move our needle. And we're still a growth industry, but for you who followed us for years, you'll see more drivers of growth. Definitely technology because clients will be increasingly worried about how to organize this. And their answer is in many times to outsource it to the likes of us. But what's very interesting is the bottom 2, variety of work forms and the governance of work. So I do a lot of lobbying, talking to governments about labor markets. And in many markets, we are still the bad guys of flexibility and we don't want flexibility, we want fixed jobs and blah, blah, blah, blah, blah. Well, actually there's new flexibility coming in with the Ubers of this world. And I've got nothing against Uber, but there is societal pushback. If you are a company that doesn't really talk about people, that doesn't really talk about employing people and the only thing you're saying is, yes, they're freelancers, meaning what does it really mean? And we do see certainly in Europe, which is a big market, pushback. And here we provide a solution because we are well regulated flexibility where people are insured, where people get a pension, not in every system, but in many systems. And we think that's a solution and we think this will drive penetration because of flexibility, gig economy is there to stay. But people, they do want a decent living. It's actually also a sustainable development goal of the United Nations. And we can help there. And we think our business in general, because this is not something I'm doing alone, I'm doing this with my colleagues from Adeco and Manpower, This is where we provide a voice and this is where we provide a solution. So we're quite optimistic here. And of course, the cycle always plays a role, but underlying, there's different things happening. So we're so proud of this slide that we're going to show it twice. Robert John said, I also want to show this slide. So I said that's okay, but I'm first. And why is this an important slide? It's the first time that within the top 3, one outgrows the other 2, not just because they're dominant in a market which grows fast. We outgrow competition in mainly every market And that's why we're going to show this twice. But it's also interesting and I think that's a point we want to make. Don't be fooled with the fact that this is just around tech, because here you see 3 businesses. And absolutely, our French business is compared and together with our Dutch business, they are most supported by tech. But they will show you this afternoon, there's also some other stuff they're doing. It's also in the basics a very well run business. Our Italian business is by no means a tech business. If you come through an Italian if you visit an Italian branch, there's still a lot of paper. 1st because of us and second because of our clients. And this takes time. Our Italian business is a homegrown business, which bought a company and just integrated it really well. We didn't lose anybody. We still have a culture that people want to belong to and everybody from Objective Alavoro, which was a negative growing company, they're happy to belong. ABFS gives them guidance. The culture gives them belonging and purpose. And we grow 25%. They say to us all the time this will stop, Chris, but we're very confident that this will not be the case because the Italian market has this pickup in modernization of the labor market. And then our mostly Spanish business says Iberia, but our Spanish business is a mix. So again, our Spanish business, very well run business, mostly homegrown management and most of them are engineers, which we don't see a lot in our business. So they really engineered quite a lot of stuff. They before Tech and Touch, so I sent her an A there, please go there. They've got self developed ATSs. They've got data driven sales tools. They've got tools that signal when a client is becoming inactive already for quite a few years, and they outgrow the business. So free for us all 1,000,000,000 businesses, which have a basis for growth, which is very broad. Still, the more tech you put into it, the better it will support them. So in house, this is very much protect and attack. Again, sometimes we surprise ourselves. And you know I've been active in in house for a long time. This is yes, I don't know, surprisingly positive. It's also almost growth through the cycle, right? So although, yes, absolutely, in 2009, it went down. Since then, it has outgrown the rest of the business for a long time. The name of the game of this business, apart from a very low churn, you see it, 98% retention, often 100% market share is conversion, margin to bottom line. And increasing that conversion through workforce scheduling is going to be very interesting. And we do this at a big base, roughly a quarter of our business and also growing into a segment which is just below that, slightly smaller client. We think we got a great offering there, which Francois will show you. So 3 years of very hard work and we're connecting the dots, very much talking to you about that. Digital factory scale ups, RIF, our investments, our external innovations through M and A. We're not going to spend too much time on OC yet. We're going to do that probably next year. A few words here. For OC, we've bought a capacity we don't have ourselves with the exception of our U. S. Business. We got a statement of work solutions business in the U. S. Doing very well, growing double digit. And OC does the same. So we're building a statement of work European business in IT and Engineering as we do as we have in the U. S. So this will lead to a global statement of work business, which is a very attractive space, but it's a very scarce capacity to really calculate these projects on a client base. So more to follow, but very promising. So as I we're going to talk about and we got some local innovation that we're going to show you. And this is where it gets complicated, because if you get new tools, everybody's really excited and everybody will say, yeah, this really works. But then our finance guys comes in come in and they ask the tough questions. They always do, by the way. They say, okay, so what kind of problem or solutions are you doing here? Are you just experimenting because of experimenting? How big is this market? And ideally, is this a global market? And what's the product market fit? What are the achievements so far? These are the same questions we ask our startups within RIF. And then it always gets a bit dicey because they're always very excited about their tool, but then we start asking these questions. And if it really has growth potential, then we scale it up. So it says pilot, MVP at the bottom, minimal viable product and then rollout. And we will show you quite a few of our initiatives, which are in the right hand scale. So the conclusion of my first presentation this morning on general strategy, an integrated tech approach is crucial, meaning if you don't touch all the basics on training your people, on finance, on how to run the business, on go to market, on marketing materials and on tech support, it won't work. It won't work. So we're not going to talk to you about tools. We're not going to do workshops on individual tools because that's not really what it's all about. And that makes it hard work because at the end of the day, and I love all colleagues, immensely, the human makes it happen. And we will show you this afternoon that although the tools are great and the whole approach is great, it takes time for people to work differently. It takes us 1 or 2 years at least and it's probably never finished, but I think that's interesting. And by the way, that also makes it exciting. Probably new, reemphasizing again, we firmly believe in our business, this is the first time that because of data, there's higher barriers to entry in favor of the big players. So we do see certainly consolidation at big clients level and we will see disintermediation of small players with no database, with no tech support. We're still running the learning curve. So we will show you through our digital factory what we're scaling up, but still through Riff and through our major countries, we're still experimenting. And we will never stop experimenting. Show you this afternoon, a lot of tech in our business is still far from mature. So we still experiment. And very important, we will show you we've got some large addressable markets that we're rolling out into. And at the end of the day, further market share driven by Tech and Touch. So very much organic growth. We've always talked about organic growth. We're back to organic growth. But based on data, which is a different type of organic growth, which we think has much more potential through our people. So our Dutch MD, some of you read Dutch newspapers, talked about Tech and Touch. And interesting is that although he talks a lot about growth, he explicitly said we're not going to fire people, still this gets picked up. And that's also something where our industry is different from banks. Digitization doesn't lead to layoffs. Digitization at Randstad leads to more connections, better connections, faster growth. And although we're going to talk about cost savings, we're not going to talk about less people because again, 6% market share. So that's why our people are picking this up, very motivated. We do a people survey every year. The new survey is just in. And again, we pick up quite a few points. And you might say how important is that? Well, in a people based business, people going out with self confidence, happy where they're working, that really works. So we're in a great place and great to share the rest of where we are with you today, but it's hard work and it's not going to be easy. Thank you very much. RJ, you know one slide already. Thank you so much, Jacques. It's good to be here again. It's a bit of a special day for me, as you can imagine. It's special because we are sharing the details of our take and touch strategy with you. It's also a bit special because this will be my last Capital Markets Day. And I've been thinking about that a little bit. You're not we're not done because next year we'll still have the Q4 results, the full year results, the annual meeting of shareholders to share with each other. But in case you might be interested, why does it feel good? It also feels good because I want to put something in place, which is the foundation for my next career. And there's one thing I wanted to share with you. My father retired at 57, and he never worked after that anymore. And that is a bit of a strange thing that I don't want to see happening to myself. So another phase in my career. I'll be still transferring and I would like to introduce Henri Schirmer, who sits over there as my successor. He'll be with us in the morning today. You can ask him any question you want, but he knows nothing about Randstad. But if you want to ask questions about Unilever, be our guest. He'll leave in the afternoon because he still is with Unilever and he'll join us at the end of March next year at the AGM. And then I will transfer duties to Henri. As some of you know, I also have some operational responsibilities for a few countries. I'll transfer that later in the year and then spend 2019 as an advisor to the supervisory board. But it's great to leave Randstad behind with a great team, with a great strategy, with a great finance team who has organized this today again with a great successor, makes me very happy. It's too early to say goodbye, as I said, but it might be the right moment to set the board up for some challenges because I will remain a shareholder, but I won't be there. But again, this is a strategy which is shared with all of us. I'm going to take you through 14 slides only to share a few things with you. First of all, current trading. Actually what you see here is more or less the press release of the Q3. So revenue growth in October is fully in line with the Q3. The volume trend has so every week we measure the volumes of people that we place with our clients. We can see in the month of November, it is in line with October. And we see if you look at the distribution, we see robust growth in Europe, continued and slight improvement in the U. S. With the emphasis on slight. The outlook, Q4 is a bit more challenging because of a stronger comparison base that is geared especially towards the end of the year. There's also a lot of uncertainty. I mean, the month of December, Christmas, we all like to be off with Christmas, but we don't like our people to be off because you can't invoice. And Christmas is on working days, so that takes out 0.5 working days compared to last year. And that typically also has an impact on the gross margin because in some countries we have a cost against which we can't invoice. So that's why we believe the gross margin is expected to have some savings kicking in, especially from the Monster Highs. So that's why we have some savings kicking in, especially from the Monster side. So that sets us up for the Q4. And again, this is the slide that Chuck showed. I have a completely different explanation here as you can imagine. The story here again is we are ahead of markets, but we still in some countries below the peaks in the past. For example, France, still 15% below the peak. In Iberia and Italy, very low penetration rates, which is clearly sort of an emerging market. I mean, imagine those old markets being emerging markets, but that's what they are. It's just we are just establishing ourselves as an industry in those markets effectively. And the U. S. Is above peak, which might raise some questions, but please note that our product is also an outsourcing product. There's lots of clients that just want to get rid of reaching out to clients, connecting with sorry, reaching out to candidates, connecting to those candidates, testing the candidates, taking care of Obamacare and so forth, all kind of complexities. So and I'm also showing this slide again because what we believe is what our strategy should do is make sure that this continues, being ahead of the market. Looking at a few countries now. France ahead of the market here clearly, which again will be shown in the afternoon, but there is a clear link between our performance and the tech side of our tech and touch strategy in France. In terms of EBITA in the French market, we are number 3 in revenues, number 2 in return in the French market. Italy was already mentioned. And if we look at the growth rate of a declining business now being combined double digits, it's a great storyline. North America, it's not a great place for a few players, but we are clearly ahead of the troops here and Jacques already spoke about the reasoning behind Iberia, but also in return, we are the leader in the market. Another component of our growth rate is perm. In the permanent placement space, we I'm sharing with you some details on the contribution of perm as a percentage of gross profit. Just a data point in 2,007, that was 12% of gross profit before the crisis. Today, it's 10%. So that's at the consolidated level. But if you look at the more distributed level, you see that in some countries, it's way above. The average here is at 10, but big countries like Belgium, the Netherlands and Germany are on the right hand of the graph, which means ample opportunity. Also when we compare ourselves to the average growth rate of the competition in 2017 year to date, you see a 2% point difference. That means we have a substantial potential here. We think we could double the size of our business in our established markets. And that is clearly a strategic focus that we have in place. A few details here. Four countries in France, it is 9% of our gross profit now growing very rapidly, again relating to our partly to our take and touch strategy, but still below the 2,007 peak as you can see here. The Netherlands only 4%, so also ample opportunity to expand it further. And by the way, this includes perm, both in the space where we provide, let's say, blue collar, white collar employees, but also in the professional space. It's the whole scope of profiles that we are placing. In Germany, only 5, in Belgium, only 3. So significant opportunity here. Few things about cost. We have announced some cost saving programs, 1 in 2014 on the back of a global benchmarking of our back office, we did very detailed benchmarking. We still continue doing that and we continue to see opportunities. For example, in the space of the finance back office where we spent like €100,000,000 globally every year, we've gone through very detailed analysis and we know how companies compare and where the opportunities are and 2014, we shared with you an ambition between €60,000,000 €70,000,000 That one was realized, as you can see on the right hand side of the slide. It took us 2 years. Part of that was consumed again in the difficult market circumstances in the Netherlands where prices went down, but it was an excellent contribution to our competitiveness. In 2015, we told you about another ambition, €50,000,000 cost to be taken out from IT. We moved into a shared service center where we moved the data centers into the cloud globally, which is what many companies do. But if you look at the size of the operation at Randstad, are one of the largest in the world. This is really, really a very significant move. It's well on track. It comes with some challenges, I can assure you, but we are going to get there. Then we have another component and that is our data communication. We used to buy data communication at the local level In one country, NATO approved. In another country, consumer level quality. We have made sure that we have one approach here, collective buying and that also provides us with savings. And on top of that, we'll have more opportunities, be it an end user computing and so forth. That together is a €50,000,000 saving. We are well on our way, as you can see on the right hand side, but we still have €20,000,000 coming in. Part of those savings have been reallocated, as we promised in 2015, to the digital initiatives that Jacques just showed you, to the organic digital initiatives. And now today, we also have a program in place between €70,000,000 €80,000,000 which includes further benchmarking in the company throughout the various departments, especially back office. But also we are looking at employee benefits, the cost of that, if we can do something about it, we have some plans in place. And then finally Monster, a big change. And as you know, we always have the ambition to do restructuring with a 12 months payback. So that is going to take us for the next 2 years. In total, 20 eighteen-twenty 19, what should come through is between €90,000,000 €100,000,000 Looking at the adjusted cost base, so at the adjusted EBITA margin, I mentioned it a few times, a balancing act. On the one hand, we have a strategic ambition getting to 5% to 6%. On the other hand, we have a tech strategy that should serve us in the long term. And one way or another, we want both. We want to make sure that we have progression on the EBITDA front and on the other hand, we want to make sure that we have solid progression on the strategic side. And that is a balancing act. Once again, sharing with you here on the left hand side, the Q1 of the year from 3.6 to 3.8 reported, but if one would adjust 3.8, that's also because we had a working day, positive working day impact in the Q1. In the Q2, we had a negative working day impact and substantial investments in the digital space of which Monster is a big part. If one would adjust for it, working day 20 basis points, digital investments 30 basis points, getting to 5% EBITDA. And then getting to the last quarter, Q3 from 5.1% to 4.9%, again negative impact from working days, but also a substantial investment adjusting for that investment in digital getting to 5.4. So these are the ingredients that do play a significant role in the way we show our performance. This used to be an ice ball, a bucket, a basket, whatever you want to call it. But here we have the ingredients that determine the performance of the company in 2017 'eighteen. On the left hand side, we have taken the consensus growth rate for 2018 at 4.5 and our expected market outperformance that we have just shown you, but also the impact of business mix changes, perm growing faster than the rest, in house, as Jacques showed you, outperforming the market across the board. SME focused through our activity based field steering, so very much looking at that segment of the market and coming through with good successes in various markets in the Netherlands, in Germany, in France. On the right hand side, digital, we have ongoing investments. However, Chris will explain you about Monster next year, where we have the ambition to get to breakeven next year. And also, we have additional early signs of additional sales growth in our overall digital efforts. I already referred to it in the context of France and you'll learn more about it in the afternoon. And our OpEx savings, so you add it all up, put it in the bucket, then we feel comfortable clearly with the 4.6% consensus for this year. And for next year, contrary to what some others are saying, we expect margin expansion to come through at the EBITDA level. That is clearly our ambition. Looking at M and A for a bit, these are our last projects. In the first three columns, you can see the reason why we acquired it and in the last column, you see the current status of that acquisition. So profits in the Scandinavian market, it served us to have a bigger footprint in the staffing space and in the professional space. And it is in line with our ambition to create to be an EVA positive within 3 years. Then we have OIBUTI Volavoro. That was it wasn't a gift, I but it was a damn good purchase, I tell you. This is an Italian company that was in decline. It's now growing rapidly. And on top of that, we integrated the back office fully. We left the front office in place and it's doing wonderful. It's purely in the staffing space, clearly ahead of our ambition. Kareo, a Japanese acquisition, by the way, the first two were both €400,000,000 roughly of revenues. Kareo, €65,000,000 smaller, it helps us in staffing and in professionals and it's growing rapidly and we use that sales scale in the rest of the organization to accelerate. Then Monster, we'll talk more about it in the afternoon, clearly underway. BMC, an acquisition in the Netherlands in the professional space, also they won a pretty good deal, very disciplined M and A process, excellent execution ahead of plan. And OC, as Jacques said, we'll talk more about next year. That one is clearly underway where we see significant growth in the French markets, in the Belgium markets and where we are gearing up in the German and in the U. S. Markets. Looking at M and A going forward, what are we going to do? Well, as you can see here, on the left hand side, the same categories again, but now in a different sequence. The first block is what do we need to invest in our Take and Touch strategy. The second block in the professional space and the third block in the staffing space. Starting with Tech and Touch, mainly organic. That's what we're going to do through our digital factory as just also addressed by Schuck and complete the repair of Monster and the global rollout. These are the priorities here. So from an M and A standpoint, not a lot of significant things to expect. Professionals, another space where we have an ambition. OC is the vehicle to expand and conquer the tech space in Europe, including the statements of work that Jacques just referred to. So it will be organic growth and bolt on M and A. And on top of that, over time, we'll have some small and mid sized M and A across the board. The professional space is even more fragmented than the staffing space globally. There clearly is an opportunity to have a more prominent position in this space, but we'll do it gradually. And then finally, staffing, we analyze the world, we look at the significant markets and we concluded that we are not yet at the right size in the Japanese market in the UK and Australia. However, that is not a priority. We believe there are other options that go before these and we have a pretty good footprint in Japan Australia and U. K. As we all know is a difficult market, but still we have a pretty good footprint to work from. So at the bottom, focus will be on value creation on the basis of our current existing footprint. We don't need any geographical expansion. We just want to be bigger in the markets where we operate. There will be no large transformational M and A going forward. That is not on our agenda. It would not support the take and touch strategy that was just outlined to you and we'll talk about it more in the afternoon. And very specifically for 2018, we anticipate limited M and A. Few words on free cash flow. Over the last 10 years, we have a very volatile stock price, but our cash flow is not that volatile. So something sort of goes wrong here. So we felt we should spend a bit of time on that with you once again. This is where you see our free cash flow from 2,007 into 2016. And if you look in the middle, you see 2,009, you might remember that was a horrible year. It's followed by the way 2,008, where you see a relatively high free cash flow, that was when we acquired Vidior and when we applied our copy paste strategy on copy pasting best practices and we started to address DSO in one go and that's what we earned with proper DSO management. So that was a pretty good one. And then came 2,009 with 27% revenue loss, 27% revenue loss and look at the free cash flow, release of working capital. That's what happens to the company. 2010, a good year again, growing, but that's why we started to invest again in working capital. Well, you can see we made one adjustment to 2013 for €131,000,000 because of a tax payment, The only one by the way. And you can see our CICE now something that is delayed. We could have sold it, but it has a cost. We decided not to do that. By the way, the 2013 CICE66,000,000 has arrived in the bank, safe and well. So we're very happy with that, as you can imagine. But I just wanted to point out the relative stability of the free cash flow of the company. As per today, if you look at 2017, we've made significant investments in the working capital side. We have made investments in the EBITDA of Monster, CapEx of Monster. So that sort of is a also a specific impact in 2017. If you look at 2018, if we apply the consensus again, we will get the CICE in 2014. We should see a significant improvement of our free cash flow. This is not a mistake as a slide, it is illustrative and what I'm trying to show you here is we have tested our cash flow against 6 scenarios, 6 scenarios. So free cash flow, 6 scenarios. Nice growth scenarios, but also a thunderstorm and a double thunderstorm, which is even worse than 2,009. And what you see here is the bandwidth of what happens to the free cash flow in those 6 scenarios. So once again, emphasizing, I just shared with you the past and this is like the potential future in 6 scenarios. And people very often underestimate the impact of working capital in the downturn. I wanted to emphasize that once again. Of course, this is not only to inform you, it also has impact on what we do. Because if in the company, we have less need for capital for M and A and we have the stable cash flow, there's something we should do with it. So here on this slide, you see on the left hand side, you see the old strategy, so to say. So our first priority is investments in organic growth, then in M and A, then dividend. And then you see share buybacks and special dividend with a star behind it, because we always said, if the balance sheet of Randstad becomes very relaxed, we'll entertain discussions with yourselves and with the other shareholders to look at what to do with it. So far, we didn't get there. With the new strategy, we're probably going to get there. It's very likely we're going to get there. So one change is the new strategy. Another change is the founder of Randstad, who still has a substantial share in the company, roughly a third of the shares of the company. He's now 84. He has transferred his duties to a professional team. They are running the sort of the holding company where the interest sits and they also have a slightly different view on this, whereas the founder was always much more focused on whatever money you have invested in growth. There's much more balanced view here now. So there will be support for a different strategy in this space. So what we are working on, it's not finalized. What we are working on is that we use this sound free cash flow outlook again for our investments in organic growth, but let's say 3%, 4% working capital needed for organic growth, 3%, 4% of revenues needed. We are going to maintain our dividend, our cash dividend policy. I mean, consensus is around 1.0 leverage ratio. That result, that should result in a cash payout of the dividend over 20 17. In 'eighteen, we'll have some selective M and A as I've just presented to you. And when the leverage ratio is below 1 point 0 times EBITDA, we are investigating the optional additional cash returns to shareholders as you can see here. And we'll get back to you on that in the first half of twenty eighteen. That's a process that needs to run properly. Again, I explained to you the position of the founder and we believe that we can come up with something very decent to you in the first half of next year. Finally, I was thinking about how would I want you to go away from this session today. And I just wanted to summarize it quickly for you. So if you remember this, that's probably the most important part. So what Jacques also presented in order to improve EVA on the right hand side, of course, we have the 2 components, earnings and capital. Actually, there's one more, it's not here, it's flexibility. Because if you get it right in 1 year, you have to make sure it's also right the next year. And this company needs to make sure we are flexible. 2009, we were able to adjust the cost base by more than 30% in 6 quarters. And that is because staff turnover continues. But now, I mean, I explained to you about the IT outsourcing. We buy IT by the kilo, more or less. That allows us to make adjustments there too. So we constantly have to make an investment in the flexibility of the company as well. That's what we do. But looking at earnings and capital on the earnings side, gain market share that is our first priority. So whatever the market does, we should be north of it. And that is through our in house, through perm, etcetera. Then we have digital on top of that, which was already discussed by market performance. That's how we set our own ambition. Finally, our activity based cost activity based field steering, that should help us to make sure that we address the right markets, for example, the SME segment and our cost savings that I just discussed with you. Together, that should result in improved earnings. On the capital side, as I said, selective M and A, strong focus on DSO, which is absolutely required. And by the way, you also talk to other companies. I know Henry talks to Unilever sometimes. Can you make sure that payment terms are sort of kept within the range set by directives in the European Union because we have agreed 60 days. We are not a bank, come on. We have clients that come to us for money. That's not what the business we are in. I mean, it's difficult to run a bank by a banker. So imagine running a bank by a staffing organization. And the capital allocation policy, which we'll come up with in the first half of next year. We think those ingredients are the sort of economic parts of the strategy that we are sharing with you today. And I think now, David, you're in charge. We're now getting to Q and A. Yes. Hopefully, it works. Sorry, 2 housekeeping questions. First of all, for the people in the webcast, there's no availability and option today to ask any questions. And in the room, let's please limit yourself first to 1, and then we take it from there. Thanks. George, I think was the first one. Hans, thank you, please. Good morning. It's George Gregory from Exane BNP Paribas. I guess it's for Robert Yan. Just on 2018, specifically the I was hoping you might give us some color on the margin building blocks. So as I can see, there's 3 items that we'd be keen to get your thoughts on. Firstly, you mentioned Monster. The aim is to target breakeven. What sort of reduction should we expect could we expect for 2018? Net cost savings, obviously, you've put out a target. And then finally, digital investments, obviously, you've made some sizable investments this year. What is the delta going into that? I appreciate it's 3 within one question. But if you can give us any color on those three elements, that would be useful. That's one question, right? And this includes the whole company. Indeed, Monster is clearly one component here. And the other component, I think I can summarize it into the incremental conversion ratio. So the cost savings should come through in that as well. What we are looking for is to have additional growth in gross profit and drop through of that additional growth into EBITDA of between 40% 50%. That is how we set the ambition for ourselves. In some cases, it's north of that. In some cases, it's a bit south of that. But on a blended basis, it should be between 40% 50%. And it's unavoidable if that is the rule of the game, then you'll see margin improvement, EBITDA margin improvement. And any color on Monster at all? On Monster. Monster. Well, I think breakeven is quite some color. So you think you can get there? We think that's the ambition we have. I mean, we don't know for sure how the future looks like, but with everything we have in place, Chris will talk about it, we think that that is the realistic assumption and ambition for 2018. Thanks. George, maybe quickly on Building Blocks. So the gross margin assumes, let's say, quite similar mix effect as in previous years. So if you look at 2017, there's a mix effect because of the fast growth in in house. So it assumes a negative slightly negative mix effect in the gross margin also in 2018. Sorry, Denis. Thanks, Margita. Margita. Yes. Good morning, everybody. Denis Moureaux, UBS. I have one question on the dividend actually and especially in comparison to what you've shown on the free cash flow, which So are you willing to commit to a much more steady dividend payment in the future with that backdrop? Well, two answers here. One is, you're right, you're referring to when we canceled the dividend. This was following a transformational transaction buying Vidior. By the way, buying Vidior in 2,007, announcing it in 2,007, completing it in 2,008, after the stock price had halved. We felt timing was good then, but only then we found out 2,009. As a result of the debt level, we paid the shares and in cash. As a result of the debt level, we felt it was not safe enough for the company to continue its dividend position is out of the question now, to have such a high level of leverage. We aim at MAX 2 now and we were just we were slightly north of 2 when we acquired VDR. So that's one. Your second point is that is what we're going to discuss in the beginning of 2018. But these are clearly options that we have in mind as well. Matthew, finally. Good morning. I was going to ask a slightly different question, operational question. Historically, as you got towards the end of the cycle and the dreaded scarcity word Gott mentioned, one of the advantages of Staffing Company was that in practice, branches might find that the more scarce clients went candidates went to clients who paid a slightly fatter margin. Is that dynamic pricing, I suppose, as it was, is that possible within the MSP and in house model and all of this new tech? Or do you find yourself in a market where you can't actually do that? Yes. That's a great question. I like operational questions, as you know. We're going to show you this afternoon also pricing tool. And that's very helpful. So in the old days, we would say to a client that this was a very tough to find profile. Now we're going to show the profiles that are out there, the clients that are competing for the same profile and that leads to a higher price. So that's the good news. And we have the traction already at Tempur team, which we're going to show this afternoon. We also have it at Yacht. So that's good. But it's not all good news because we're still fading out with large clients buying at 120 days payment terms where we're not going to go, clients who still think it's all purely purchase driven. So now that offsets, although at the end of the day, it's stable margin. Ideally, yes, if the cycle in Europe persists, we do see some increased pricing power and more tools prove to clients. So we're optimistic, but it's too early to give guidance. And Mitch, just to avoid, where are we in the cycle? As you know, we don't really invest in that. We make sure the company adjusts very quickly to whatever happens. But if you look at the composition of growth, blue collar, industrial manufacturing is still a large chunk the largest chunk of it. So we have no indications to support an assumption of being late in the cycle. Thank you. Andy? Just another question on pricing. We've seen pricing come under pressure for the last 2, 3 years in some of your major markets. As part of the strategy, you're going to focus more technology into those large client portions of your business. How do you think that plays out from a pricing perspective? Is it we're going to see that incrementally get worse? Yes. So there's a few things to mention here. So first of all, we are very optimistic about a large part of our growth with large clients is going to be with professionals. So although we're going to, in a way, be quite competitive in pricing and professionals that but we're competing with a lot of different companies on different pricing, yes? The staffing environment from a pricing point of view is totally different environment. So for us, that's still a very attractive field, which won't dilute margins. And the second one is on pricing, which is very much the conversion game with in house and workforce scheduling, which we're going to present this afternoon. Conversion is already very high in in house. But as I mentioned, in the protect and attack strategy in this segment, we will still see a high conversion. So even if this margin would still come down, we will have higher conversions. That we are shedding a lot of low margin business currently in the Dutch and also still in the French business is very much also the role we see as a market leader. Someone needs to push back here, and that's what we're doing. So we talked a lot about growth, and we didn't explicitly emphasize it, but this is not growth at the expense of margin. Because again, as we showed you many times, in our Dutch business, we can easily grow 3% to 5% faster. We're not going to do that because we don't think that's the right way to go. So we're very much awaiting our clients to come back here because at the end of the day, they probably won't find the people they like. So that's going to be the pricing power, but let's see if that happens. Does that answer your question? Yes. Okay, good. Mark? Sorry, Hans. Yes. Mark here, thanks. Mark Watsberg, ING. I want to clear up a bit on the guidance for next year on the margin. Are you now saying that your margin will approach to 5% to 6%? Should I take it as a 5% to 6% because the spring factory Monster could be quite sizable? Maybe you can give a bit of color on that. Then you have a bit of working day positive impact. And then you have the conversion ratio. So to me, that doesn't add up to something from 4 to 4.7 to 4.9. So could you give a bit more color maybe on the digital investment? What explains that? So you want 4.95 or 4.98 because we know, right? Well, as precise as you can be, but It doesn't add up to me. So that's why I'm a bit puzzled. This is not a surprise, this question. We knew it's coming. We have our scenarios. Let me rephrase it as follows. It's not impossible to get to the 5%, but it requires a steep growth rate. It requires the conversion, the incremental conversion that I just referred to. But if you look at the consensus now, 2018 with 4.5% growth, that's not going to bring us there. That's going to it's going to show clear progress, but not exactly to that mark. And there's 2 answers to this question. The first one is, we get asked that question a lot. Do you still believe in your 5% to 6%? And we do feel with the different company we're creating, with the conversion rates, with opening new markets and digital that 5% to 6% is totally feasible. The second one is, will you get there into 2018? And you know, we're not aiming we don't start with we want to get to 5%. So if we would decide solely to make 5% next year, we can do it. But that's not the goal. It's the result of what we do. The growth rates, of course. Again, the investments because at the one hand, you might say, we aim for a breakeven at Monster. But if we do see tractions in some markets, we're still going to invest and then we're going to say, well, by the way, we still lost a few million. But we'll have a story. So absolutely, given the business we're in and our strategy, making a step in mid singles growth next year and the rest every quarter we'll update you. Yes. So the key priority is to show market share gains with improved EBITDA margins through a good incremental conversion ratio. And then it depends on the model, the scenario you put in. The digital investments, can you shed a bit of a light? They are included in this analysis. So if Monster is at 0, it means they are still making investments. We continue to make investments in the digital factory, but we also should start to see the results of them coming through. We are seeing it in 2017 in selected markets. We should see that more broadly in the company in 2018. And organic investments here, the returns can be very nice. You might remember our EVA in 2007 being at 31%. Yes, Shwoshen, there at the back. Thanks, Suhasini. And Amit, of course, return on invested capital, Mark. Good morning. Suhasini from Goldman Sachs. In one of your previous slides, you showed how you plan to disrupt the smaller perm market using those who basically have just a LinkedIn license. I'm guessing that you plan to use your own database to so do you think your database will rival the likes of LinkedIn in the future? No, I don't think they will rival the likes of LinkedIn. They are as big as LinkedIn. Okay. And I will show you this afternoon. Looking forward to that. Thank you. We knew this question was coming, so. That's a quick one. That saves time. Thanks, Dolby. Hi, there. Can I ask sort of 2 questions disguised as one, but last year, it's on digital markets, so general digital markets? But last year, you talked about U. S. With a couple of U. S. Markets being right for disintermediation and the plans to do that in 2018. I think that wasn't necessarily U. S. Perm, it was also professional. How have the thoughts evolved on that? And in the similar sort of line, what's your strategy with 3 lancers? Thank you. Yes. So yes, absolutely, the U. S. Market in our perm and process is not the same, but it is a similar market. So yes, there are a lot of small players in the U. S. Market in professionals perm. And we do think their business models are not very sustainable given where we are going to go with our strategy. This sounds a bit, how do you call that, quizzical, but we're not going to share the way we're going to do it. Linda always calls this stealth. But we're definitely going to show you once we see traction. So today is all about and I hope you get that, that the basis for this intermediation is quite clear. And that's and yes, time will tell. Yes. Also some online versions here. So I mentioned the Singapore model, which is in any market. But the Singapore model, again, allowing our clients to search for their own candidates in perm. Our cost is 0. It's really 0, certainly in perm. But it takes a lot of time. Interesting enough, our clients have a hard time looking into platforms. Our clients have a hard time navigating technology and data. So interesting what we see in our French offering, for example, we got a few of these emerging online offerings. 2 thirds of the client who search, which is still a very small group, by the way, they succeed in finding someone. 1 third calls us and we're monitoring this. They say, well, I'm looking for it and it looks great, but can you help me? So it's also sort of a sales channel, which goes back to my earlier statement. It's very tough to really measure the improvement like for like on what you put in, in digital Because, yes, I get more leads in my branch network because of my online offering. So this will take time, at least 2, 3 years for these businesses to get any traction. Investments in marketing, very much investments in marketing, I introduced Joanna. She comes from the finance industry. And as you know, went a bit ahead of us in digital, in creating a social footprint, in how to make your offering visible because we sell through our people mostly in our day to day business. An online offering will allow so you need to get your clients to work with it. And it's complicated. Even our big clients, and maybe Rebecca in the afternoon can talk about it, even our big clients, the best HR professionals in the world, they still have issues navigating this as we have because it's not an easy space. Yes? And do you include freelancers in your previous Yes, freelancers. Yes, freelancers is very much linked to what I said as one of the drivers of our penetration because a freelancer has 2 issues. The first one is how am I secured? And the second one is am I insured and all that. And the second one is where is my next job? And society is saying in Europe, if 10% of the workforce is a freelancer, they're not insured and they don't pay taxes. And Social Security systems are pooling systems, so you bring people with relatively good health and good employability into the system. They are net payers, but they're not in this system. So something needs to give here. And we got freelance offerings. What's also very interesting about freelance, and again, Rebecca, you can spend some time on this afternoon, clients want their curated pool of freelancers. So we're now working with clients where we say and we use the capabilities of Twago here to say, okay, so you want all your freelancers, whoever work for you, who might work for you because based on the algorithms, we can see which kind of freelancer interested in working for you, we'll just curate it. And you can go in or we can go in, whatever is going to be dedicated for you. So that's compliance and availability on freelancers, very interesting space. Thanks. Thank you again. I wondered if you could just And whether you have any views on how they might affect different players within the industry? There's some concern that very high-tech, very low touch might have much higher costs. And I wondered if you had a view on that. Yes. This is a challenge. The EU sets new standards in this space and we have adopted those standards to cover us globally. So that is sort of the threshold for our global operation. They will become effective in the course of next year. Most probably, there are some discussions though about this. We are spending a few million on this to gear up here. So we think it's an effort. It's not always useful because you have to throw CVs away that are older than a certain period of time, whereas you might still be able to use those. But it's not a significant cost to our operations. It is a burden that we would love to have to reduce, but we can handle it. Yes. And as a follow-up on this one, we do think we're well positioned because we have curated platforms. We got vetted people. We got vetted profiles. And that's a difference from an open source and nobody knows. So from this point of view, we talk a lot to governments on how to handle this because they're also looking for a new one. Yes. And there's a commercial opportunity connected to it. There's lots of global clients that are looking for compliance suppliers. And by adopting a standard at the EU level globally, we think we have an additional commercial argument. We hope it works better than the payment directive. Tom, Hans here, yes. Thanks. Good morning. Tom Sykes from Deutsche Bank. Just in addition to Matt's question on data, do you sell I mean, and you made the comments about the quality of your data. Do you sell any of that to third parties? Would you consider selling it to them by itself just Of course, you can buy anything to us. Yes. You can buy a job, you can buy no. This is where we draw the line. So great question. So this is a sensible area or sensitive area, right? But it plays to our advantage because this is where always being compliant, always being a value based company, always investing in relationships with governments, we are credible in this space. And we also advise governments on where to take this, because Robit Jan mentioned the fact that we're bringing our database to the cloud. Well, honestly speaking, sometimes in Germany, they still think the cloud hovers above the country, and it doesn't. So we need to really get our message right. And we also, in connecting to candidates in future, we need to do this in a very, 1st of all, compliant way, 2nd of all, in a non invasive way because what we do see already, I think recent studies in the U. S. Say that close to 60% of candidates find the HR space increasingly unpersonal, again, a basis for our tech and touch strategy. So although we might reach out to people through chatbots, it still needs to be in a noninvasive way. There's going to be some trial and error here, but we're going to be very transparent with governments, lawmakers on what we're doing. And it's very much also AB testing. And there's some very counterintuitive stuff here. So in Asia, where and again, I mentioned Singapore, which is a bit of investment or an experiment hub for us. So we do 4,000 personal connects and we do 4,000 chatbot connects. Actually, people like the chatbot better. Why? And we research that. It's because it's in their own time and they can just take it as they want. So that's okay that apart from privacy, we still need to work. If you do it non invasive and very, call it elegant, then it's good. Because people are still they have the initiative and they know that at the end of the day, they can still connect to a human where, of course, on the LinkedIn, there's no alternative. I don't know if you're on LinkedIn. I'm on LinkedIn. And of course, I got a yes, I got no CV, right? CEO, staffing. So I get lots of funny jobs, which they don't match, they totally don't match. And I got no one to complain to. Well, with us, you can complain. You do see in retail already some companies, they open shops and why? Because they want to have a stone thrown to the window, because they want to complain. With us, you can complain. You can also say, I'm totally lost, can you help me? I think that's the value of our strategy going forward and the weak point of the just data companies. And as you build up maybe more freelancers, contractors, etcetera, would you consider selling more services to them that you might make a margin on because of that like insurance? Yes. Well, that sounds like an attractive model, Tom, but we've tried it. So we've got a business in Germany called Goup. They're 20 years old. Interesting enough, they were an online offering to begin with 20 years, one of the first movers ever. They now also have people visiting clients and managing the data base. 90,000 freelancers roughly. And there is insurance stuff and there's but it doesn't really gain any traction. So we're not really advocating that. Actually, the Monster side, we cleaned up. So on Monster, you saw lots of stuff, but we it goes against what we call the seeker experience, because the seeker experience needs to be super fast, super personal and just about seeking and not buying a new lawnmower or whatever. I don't know what you were selling before, but let's say close the link to that. Thank you. We will sell other services, sorry. We will sell other services, but then very much linked to what we do. So what we're going to do on the Monster side is going to be RiceSmart. So if you're not looking for a job, but you're in a job and you want to know how you're matched up and what your future is, you can buy a RISE Smart diagnosis or even a RISE Smart Talk online to a job coach. We are selling employability scans in the Netherlands that if you're 45 plus, you can check your employability, which is a big data tool. We're still selling it directly to client, but I can totally envision this being on our site. But that's then very close linked to our business and employability. More questions in the room. Paul? Yes. I can do it. Yes. Thanks. Yes, it's Paul Sullivan from Barclays. I mean, both you and Adecco are pitching a story where digital is additive to growth. The market doesn't seem to believe you or doesn't want to believe you. I mean, where do you see the biggest risks to the strategy? Or where do you see the biggest risks in terms of disintermediation of your existing business and franchise? Yes. So we don't see risk of disintermediation. So we are the aggressor here. One of the learnings and again, we're going to spend more time. One of the learnings of 3 years of RIF analyzing 2,500 HR startups, they don't scale. They don't scale because they need a human moment. They need sales or they need candidate contacts. And therefore, you need people, and you can't scale against us. So that's not going to happen. We're already growing 9%, as you might have seen. I don't do risks. He does risks. The biggest headache we have or challenge, and we're going to talk about it this afternoon, is our people really using the tool, changing the way they work. And that will define the time we need to really, yes, get to a next level of performance. So that's our biggest, yes, how do you call it? Again, not worry, yes, a challenge. That's around people, yes. Maybe the final question in the room. This is Anvesh from Morgan Stanley. In the statement of work business, do you end up taking more risks versus a traditional recruitment model? Because then probably you are also responsible for the performance of the candidates in a way. And how does the margin compare in that business versus the traditional business? Yes. Good question. So statement of work is a very attractive space. It is what clients increasingly want, yes? So you sell a service. And that's why we bought OC because we do, as I mentioned, in our U. S. Business, have got that capability. It's what's the return, Linda, of our Stayman and Work business? Yes. Yes. So roughly 8% EBIT, so a higher return. Also, our OC business is at this 8%, 9% bracket, But you need to pick your battles. So interesting, yes? So okay, well, let's talk very short about this. What we're going to do is stay OC in Europe is going to get client leads from our German business, from our French business, from our Belgium business. And they said to us, well, please know that we just take 1 in 10 client proposals. And that's tough because we are a business that always says yes to clients. But in a statement of work business, you really need to talk about the risk. You need to break it down into small parts of service that you say to the client, you're okay, then we move on. So it is a service, but it's a totally different way that you are working with the clients. So way more confrontational, way more fact based. And that's why we acquired OC. We looked hard at it. Francois is really close to it. And that's their business. So we like it. And as for we think we can build a leading European and maybe worldwide presence in this space compared to our peers, because this is a space that, of course, is also done by the Accentures and the Capgemini's. So it's a very broad space. We're going to take a part of this, which is the least complicated part. Just a small contribution from the risk guy? So the statement of workspace is big and you can go all the way from relatively very basic simple risks, which are easy to manage, where you can agree on easy conditions, filling boxes, to very complicated sort of building machines or whatever. And it's clear that we prefer this side. So we're very selective, as Jacques said. And by and actually, we just finalized an audit on our statement of work business in the U. S. And they in France. And they put it they break it up in small chunks, and then they search the approval of the client before they move on. So this is how you break up the risk in very small components. So we are very selective here, but the risk return is there and that justifies us to take the low end of this base. And also part of it is, of course, OC being a good business is a relatively small business. So if they do a project, then they bring in people. But of course, our companies can bring in more people. And therefore, we have more of what you might call direct fulfillment in the project, which is also an interesting combination. You see the business of OC, they if you go to their website, you see an engineering firm. If you look into the financials, you see most of it being secondment. So it's sold with that image, but a lot is delivered through time and material. Thank you. Okay. That's it. Thanks. Coffee. Good point. And a break. Yes. Yes.