Thank you for standing by, and welcome to the DGL Group Limited Full Year Results 2022 Call. All participants are in a listen-only mode. There will be a presentation followed by a question and answer session through the webcast. I would now like to hand the conference over to Mr. Simon Henry, CEO. Please go ahead.
Thank you very much. Simon Henry here, founder and CEO of DGL, and alongside me here is Ben Halsey, our CFO. We're here to talk about DGL and the FY 2022 financial year. Working through the slide pack and turning to page four. DGL is a diversified industrial group operating primarily throughout Australia and New Zealand, but trading throughout the world. We are focused on the chemical industry, and we have grown substantially over the last 12 months. We look at some of our sort of headline numbers here. Net assets over AUD 300 million, over 3,000 customers, 550 staff and growing. Sales of over AUD 370 million and substantial capacity for manufacturing, transportation and storage of chemicals and treatment of industrial waste. Turning to page five.
We operate from 54 sites stretching from Darwin to Christchurch. We've got both Australia and New Zealand well covered. We can service all the major metropolitan regions and industrial hubs of the respective countries. We own considerable property, currently valued at AUD 160 million and operate from over 47 hectares of industrial facilities. Turning to page six. DGL has had an outstanding year. We've grown strongly. We'll see here on page six some of our high level financial results. Our revenue's up 88%. Underlying EBITDA at AUD 65.6 million exceeded forecast, up 133%. The company has grown strongly. We've seen the value being extracted out of our assets working together.
We have survived and prospered through these difficult times of supply chain disruption, war, and COVID-related challenges. Moving to page seven. Once again, we look at FY 2022 as being a stellar year with strong growth. Employee numbers up over 90%, customers over 170%, sites increased over 80% and rapidly expanding our truck fleet to sort of connect all these sites and move materials. Moving to page eight. We acquired 11 businesses in FY 2022. These businesses bring wider range of services to our extensive existing customer base. They bring in new customers, they increase our service offering, and they cover geographical regions where we might not have covered previously.
Pleased to be able to say that these acquisitions have all been well and truly integrated into the DGL Group and are all performing strongly. Turning to page, actually it's page 10, and I'll hand over to Ben, our CFO.
Thank you, Simon. We will now go through the financial results in a little bit more detail. If we could please turn to page 10. We're pleased to announce that DGL performed very strongly in FY 2022. As Simon noted, we exceeded the forecasts included in our May 2021 prospectus, and the results presented today are in line with the upgraded guidance provided in April. In FY 2022, DGL achieved sales revenue of AUD 370 million, and we achieved underlying EBITDA of AUD 65.6 million, which is 133% up on the pro forma FY 2021 performance. The pie chart on the top right highlights the customer revenue by industry. Agriculture remains the largest industry that we serve across the group at 36% of total revenue.
The acquisition of Austech, AUSblue and Total Coolants means we have entered the automotive industry and now provide a wide range of new products and have diversified our revenue streams. The pie chart at the bottom left shows the customer concentration of the group. It is pleasing to again note that through the increased contribution from other DGL customers, our largest customer by concentration is now down to 10% of total revenue. Turning to page 11. Here we summarize the financial performance of the DGL Group for financial year 2022. Sales revenue and gross profit are both significantly up on prior period. This is as a result of high volume and acquisition contributions.
Cost of sales increases have been well managed by the group and highlights the nature of the mixed pricing relationship we have with our customers. We're very proud with the AUD 138 million of gross profit achieved in FY 2022. Employee expenses increased in total. This was expected, as we retained most of the acquisition employees following integration, but also we've been investing in people, and we've also seen some wage growth across the group, as previously highlighted. Administration and general expenses are up. This is a result of the increase in scale of the group, but also increases in general activity and costs resulting from COVID employee disruptions. Overall, an underlying EBITDA result of AUD 65.6 million, and very pleasing. Turning to page 12. This page shows the divisional revenue of the group over the last three years.
As highlighted in April, chemical manufacturing has had a strong year, with sales revenue increasing to AUD 235 million. Across FY 2022, we saw strong demand, which we were able to match. We also made a strategic decision early in the year to hold higher inventories to ensure supply to our customers. The acquisitions this year have made a strong impact, with their performance approximately 93% higher than their prior year comparable period. Warehousing and distribution sales increased to AUD 63 million. Warehouses continue to be well-utilized, and an increasing fleet and more service offerings are driving a stronger tie between the divisions and the customers as we offer a fuller service. Operationally, the environmental division had a very strong year, and this is reflected in the sales revenue, up AUD 25 million to AUD 88 million for FY 2022. Moving to page 13 and the balance sheet summary.
Net assets have grown by AUD 111 million to AUD 306 million. This has largely been funded by earnings and scrip. Working capital has grown by AUD 22 million to AUD 43 million. AUD 12 million of this increase is related to the working capital of the acquired businesses. The balance is due to the increase in the activities of the group and the growth we've seen during the year. Receivables from customers have increased to AUD 57 million, of which I'm pleased to say 90% is within 30 days of due date. Inventories have increased to AUD 48 million, of which AUD 35 million is raw materials. Property, plant, and equipment has increased to AUD 219 million, and goodwill increased to AUD 99 million. The investments we've made during the year have been partially funded by bank debt, capital raised during FY 2021, and earnings.
Overall, our balance sheet remains strong and well-positioned to meet customer demand and to continue to grow in the future. Turning to page 14. This page further highlights a few of those aspects previously discussed on the last page. Working capital was up to AUD 43 million as at the end of June. The increase in receivables and inventory has been funded through both trade payables and through secured trade finance provided by our bank. If not for the secured payables, our investment in working capital has increased to AUD 65 million as at the end of June. More specifically on inventory, we have provided an indicative inventory days ratio. This shows that on a like-for-like basis, inventory days is approximately 27 days higher. This translates to inventory holdings being approximately AUD 18 million higher than at the same time last year on a pro forma basis.
This graph highlights the strategic decision DGL made during April and March to hold higher inventory levels to ensure the security of supply for our customers and to ensure our competitive advantage in that space. Moving down to property, plant, and equipment. As highlighted, property, plant, and equipment has increased to AUD 219 million, up from AUD 133 million as at June 2021. Both investments in plant and strategic property, as well as a AUD 30 million increase following the revaluation of land and buildings, have contributed to this increase. Finally, Return on Capital Employed has increased to 16%, a reflection of the positive capital deployment during the year. Turning to page 15. DGL's total bank facilities are now AUD 135 million, of which, as at June 2022, we have drawn approximately AUD 90 million.
Most of the debt has a maturity date of September 2024, and as at June 2022, we remain well within our covenants. The net bank debt to EBITDA less rent is up to 1.2 x, and net bank debt has increased to AUD 66 million, with the gearing ratio increasing to approximately 22%. We remain well-funded with headroom available. Turning to page 16. Here we summarize the cash flows. FY 2022 has been a busy year of capital deployment, with AUD 102 million of investing cash flows in FY 2022, split between acquisitions of businesses, strategic property, and other capital expenditure. This deployment of capital has been funded through operating cash flows of AUD 24 million, financing cash flows, and cash held from the previous year's capital raise.
During FY 2022, DGL spent approximately AUD 4 million on maintenance CapEx and approximately AUD 8 million on growth expenditure. Growth CapEx is planned to be higher in FY 2023 but is reliant on external approvals for some projects. Turning to page 17. Just highlighting the operating cash flows of the group. Underlying operating cash flows have increased to AUD 33 million when accounting for tax payments and acquisition costs paid. As outlined previously, over the past six months, we've made a strategic decision to hold higher levels of inventory than previously anticipated. As outlined, we estimate this has resulted in DGL's inventories being approximately AUD 18 million higher. This is primarily being held on raw materials to service our customers.
Adjusting for this investment, we estimate the underlying operating cash flows to have been AUD 51 million, resulting in a 77% cash conversion in FY 2022, following on from the exceptional results in FY 2021 of 100%. The bridge at the bottom of the page highlights the flow of funds during FY 2022 and the deployment of earnings and borrowings to working capital acquisitions, strategic property, and other CapEx and other items. That concludes the financials. Now I'd like to hand back over to Simon to discuss the strategy update.
Thank you very much, Ben. Simon Henry here again, CEO. Turning to page 19. DGL is focused on industries that have considerable room for growth, Warehousing and Distribution, Chemical Manufacturing, and environmental solutions. We don't see these industries being threatened or in their twilight. We think it's good to focus on industries that, in years to come, should show strong growth across Australia and New Zealand. They're heavily regulated, high barriers to entry, and are the kind of businesses we like. Turning to page 20. DGL grew very strongly in FY 2022. This was achieved through the careful deployment of capital into acquiring businesses, buying strategic property, plant and equipment, investing in people, and establishing and developing a platform or a foundation to support strong growth in years to come.
Once again, the industries and the nature of our business is highly regulated, and this is sort of causes it to be to have high barriers to entry. DGL has serious scale now with its facilities, with its assets, with its licenses. We are well advanced in our ambition to be a leading diversified industrial group. Turning to page 21. Once again, we look at our assets, and we look at our extensive customer base and the ability to cross-sell our services to further support our customers more or less on one platform across Australia and New Zealand at multiple levels in their businesses. As Ben mentioned, we've got a strong balance sheet. We've got plenty of borrowing headroom if we wanna deploy it. We reinvest our earnings.
We are well-positioned to continue to grow strongly in years to come. Turning to page 22. This is an example of a company we took over, Austech Chemicals, located in Narangba in Queensland, focused on the automotive industry, growing strongly and prospering inside the DGL Group with its access to capital and shared services and back office support. It's an absolute pleasure to have acquired this quality business and to see it prosper. Turning to page 23. We've got a number of organic projects and developments on the go across Australia and New Zealand. They're all progressing at pace. Like a lot of industries, we have to obtain licenses and consents, and they often take longer than expected.
On one hand, it's frustrating, but on the other hand, it does demonstrate that these are barriers to entry. You need deep pockets and patience to get through the regulations to establish environmental treatment facilities and chemical formulation facilities. High barriers to entry. We love it. It's tough. We've had a lot of experience at it. Being well-capitalized, we can demonstrate to the authorities that we have got the necessary disciplines and experience in place to manage these projects and to run good, safe operations. Turning to page 24. DGL felt it was important to explain to our investors and our customers the good things that we do. We thought it was important to explain how we care for the people that work inside DGL, the communities that we work in, and our upstream and downstream supply chains.
To this end, we have embarked on developing an ESG framework, and it's in its early stages here. We've also carried out a cultural review in the company, and the report came back positive that DGL in fact has a wonderful culture, and we plan to protect that culture and hopefully see it grow in years to come. Page 25. There's no shying away from the fact that we're a chemical company. We work with dangerous chemicals and lots of them, so health and safety is front and center of everything we do. Pleased to be able to report that we had no significant events in FY 2022. Excuse me. Page 26. Once again, DGL is well-positioned to continue to grow strongly in years to come.
We're committed to reinvesting our earnings back into the group as long as we can see good targets to acquire and projects to invest in. Sitting here today talking to you, we see almost endless potential across Australia and New Zealand. We've had some exploratory trips into the U.S. looking at opportunities there. In the fullness of time, I would expect to see DGL expand beyond our current New Zealand and Australia focus. Turning to page 27. We've acquired four new businesses which were announced this morning. These are highly strategic acquisitions, once again, bringing in more customers, expanding our service offerings and covering geographical regions that we may not have been focused on before. I'm excited about these companies.
The integration has already started, and I hope to be able to report to you in six months time on how they're doing. Turning to page 29. DGL has had an outstanding FY 2022. I expect the company to continue to grow strongly in years to come. That said, I don't expect that the growth we saw in FY 2022 to continue at the same rate in FY 2023. I think that would be expecting too much. We're well capitalized. We've got great people. We're focused on growth industries, so the outlook is fantastic. But I do want to manage expectations. Obviously, we live in interesting times with the conflict in Ukraine, droughts in China, the tail end of COVID, shipping constraints. It's very hard to forecast where we're going.
That said, we're well-positioned to weather any storms or challenges that come along and to take advantage of any opportunities that come about. Thank you. Questions, please.
We've had a couple of questions come through from the listeners. The first one, the question being asked is how much inventory pricing risk is there on inventory health? The answer is that, look, we hold raw materials for a very diversified range of products. The inventory covers some pre-booked sales, and the conversation at the moment with our blue-chip manufacturing customers is more around being the assurance of supply as opposed to the price, and that provides a competitive advantage for us.
Yeah. Thanks, Ben. Holding inventory comes with risk. Some of that risk can be offset with forward sales. We are very sensitive to how much material we hold. We do like to use our balance sheet strength and our physical assets, our warehouses for holding material. DGL has been able to demonstrate over the past 12 months as having the commitment and the discipline, and to hold raw materials where our competitors haven't for one reason or another. This has contributed significantly to the good result. I do plan, or we do plan to hold high levels of inventory higher than we have in the past, until such time that we see international supply chains returning to normal, and I've got no idea when that happens. Ben.
Thank you, Simon. We've had another question come through about the seasonality and earnings. On a normalized basis, we expect that our seasonality remains somewhat similar to historic patterns. Traditionally, we have seen a split of 45% to the first half and a 55 split to the second half. At the moment, we expect that to continue on. In terms of the acquisitions that we have made, the reason for that fluctuation or the seasonality is contributed to by the ag season, and the build up and the build down in that period. Another question that we've had come through is the working capital that we have put into the acquisitions post-settlement.
Look, pre-settlement for the bringing on these acquisitions, there was approximately AUD 12 million that was required to be invested into this. Look, it's a strength for DGL that we can improve the performance of these businesses by supplying more inventory and holding more inventory. It is possible that, you know, the base level of inventory that those businesses come on with, we increase that in order to take advantage of the market. Look, it's not unlikely that we see an increase there. Following on, we had a similar question regarding to operating cash flow and when do we expect to see the cash flow normalize. In terms of the operating cash flow, we had an exceptional year in FY 2021 and achieved a cash flow conversion of 100%.
In FY 2022, look, we appreciate Cash Flow Conversion was slightly lower as we had a small amount of working capital drag, but also a strategic investment in inventory. To a certain extent, we expect the Cash Flow Conversion to normalize next year and would expect, you know, somewhere in the region of 80%-90% as we continue to grow, and also as we continue to remain agile and, you know, free to choose what we decide to invest in, whether it be stock or other ways to support our customers. We had a question here on the EBITDA contribution from acquisitions in FY 2022. It's an interesting question. The plain answer is we don't split EBITDA from acquisitions.
Once those acquisitions are integrated into our group, they utilize the assets and resources of the group. A number of them are merged into existing companies where we buy business and assets, and in some cases, we look to wind up those subsidiaries and operate them from a single company. To that extent, we don't track the EBITDA of the acquisitions in order to present it to the market. We do know that all three divisions have performed strongly during FY 2022, and we expect that to continue. We've had another question through inquiring as to the debt position following the four acquisitions. At the moment, as it currently stands, our net debt is AUD 66 million.
We expect to utilize earnings and available cash, and I expect our debt level after those acquisitions will be in the mid-70s. We've had a question with respect to the outlook statement and some clarity on FY 2023 earnings. In FY 2022, because of strategically higher stock holdings and expanded capabilities, balance sheet strength, we did achieve some opportunistic growth in earnings, which at this stage we cannot say that we'll be able to replicate again to the same extent to next one, FY 2023. As a result, we do expect our earnings to flatten in FY 2023. Notwithstanding, we do have the acquisitions we have announced today and earlier in the month that we expect will have a contribution towards our FY 2023 earnings.
There's a question here about the first two months of this financial year and our trading. I'm pleased to be able to report that all divisions of the company are performing strongly and in line with forecast. We don't have any worries about any element of the business at this time. There's been a question here about the opportunistic earnings. Look, they were achieved because we were able to supply, procure, deliver products and services that our customers required at that time through a unique set of circumstances. Look, we don't expect that to continue again, and that's just the nature of the unpredictable environment that we're currently operating in.
Thanks, Ben. If I can just add to that. Nothing we love more at DGL than a challenge. In the past 12 months, we've all thrown up all sorts of interesting challenges with shipping and commodities running out and so on. We just focus on using our capital and our assets and our shipping capabilities, our tanker fleet, work round the clock and come out smiling out of these crises. You know, it's a credit to our team of how they've responded to some of these unexpected events that have come about, and how that we've been able to deploy our extensive network of assets and continue to supply our customers when many of our competitors couldn't.
Thanks, Simon. Look, we've been asked for clarification again on the outlook. The flat earnings comment is with respect to the underlying business as at the June 30th 2022. We expect the acquisitions that we've announced today and over the last month, so that includes Flexichem as well, to be on top of the earnings that we achieved in FY 2022.
Yeah, if I can just add to that, please. We're very careful about what we're saying here. DGL had a spectacular FY 2022. I'm completely committed to seeing the company grow rapidly, strongly in years to come. That said, it's unreasonable to expect DGL to grow in FY 2023 at the same rate that it grew in FY 2022. That growth wouldn't be sustainable. We need to be careful that these acquisitions that we do integrate them fully, make sure we've got all our systems working, make sure that we've got our capital deployment on target, and ensure that, you know, we've got the bench strength and management in place to ensure that we run a safe operation and don't get ahead of ourselves.
Thanks, Simon. We've had another question through with regards to CapEx and our outlook view on growth and property CapEx. At this stage, our growth CapEx remains, again, like we stated, subject to receiving external approvals. At this stage we do expect growth CapEx to be in the order of AUD 10 million-AUD 15 million, depending on timing of spend and approvals. At this stage, we expect property, which again is fluid, dependent on the opportunities that arise, to be in between somewhere AUD 10 million-AUD 20 million. It's our current view at the moment and is subject to change. We're not beholden to purchasing property, but if strategic opportunities arise, then we do. Simon, we've had a question here with regards to strategic investment to inventory.
Has there been any tangible benefits such as new customer wins, and could we provide examples of relationships or standard sale, supply?
The answer is yes. A significant element of the success that DGL has enjoyed in FY 22 has come about simply because we had the foresight and the discipline and the capital and the assets to hold raw materials where our competitors didn't. It wouldn't be appropriate for me to name the customers that have been the beneficiaries of our policy and approach, but I can tell you that it's been a significant contributor to the spectacular result.
Thank you. We've had a question here on the U.S.A. opportunity.
Mm.
Would this be a modest capital investment to ensure a measured entry into the U.S.?
Yeah. Great question. No, we're not gonna bet the farm on the U.S.. Look, I'd be comfortable acquiring a small business there to get a foothold. You know, $5 million-$15 million, that would be the range that I'd be looking at. It would need to be in a field that we are highly familiar with and preferably connected to international customers that we're already working with, and you know, where we can take our engineers and further develop whatever target we take over in the U.S. if we decide to take one over, and use it as a springboard or a platform to consider further expansion. We are taking this very, very slowly and very cautiously.
Thanks. Simon, we've had a question on M&A strategy going forward, and the ability to handle a certain number of acquisitions a year and, you know, understanding that management
Another great question.
Not unlimited.
We acquired 11 businesses, so we're getting very experienced at it. As I've said, those 11 businesses are all well-integrated, performing well, and culturally integrated, which is probably the biggest challenge when you take over a new business. I do plan to buy more businesses. I can't predict how many or size or where, but let me say that we still see considerable opportunity across Australia and New Zealand for agglomeration and rationalization of chemical supply chains.
We've had a question with regards to organic revenue growth, and whether-
Yep. Thanks, Ben. At a high level, DGL has grown in excess of 20% compounded per annum for over 20 years. I don't see any reason why this growth rate won't continue in years to come. That said, it's not always consistent. Some years we grow more than 20%, and some years we grow less. When we look at a high level breakdown between acquisitions and organic growth, we see 55% of our growth has come from acquisitions and 45% has come from organic. We had strong organic growth in FY 2022. Once again, I don't see any reason why this sort of split won't continue in years to come.
Thanks, Simon. We've been asked for some color on organic growth, CapEx already spent, but yet to fully contribute. We're constantly buying and looking to expand our fleets, or investing in plant at manufacturing sites or setting up greenfield manufacturing sites. Those are expected to contribute in FY 2023, as they come online. In terms of scaling those up, you know, they are partially commissioned to start with then fully, and they'll continue to contribute to earnings as we grow. It also allows us to get closer to our customers geographically and shift production around sites to ensure more efficient manufacturing production runs.
Thanks for that, Ben. If I could add that here at DGL, we play the long game. We're not looking for a sugar rush on our investments. We're quite happy to invest in assets that may take years to come on stream, but they are strategic. Once they are on stream, you know, they're complete gems and, you know, we're proud to own them. This is a strategy that we deploy now. We look at property, where we buy it, the licensing, the infrastructure, the investment back into plant and equipment and trucks. We're really keen deployers of capital back into the business. This is, you know, reality, why we have enjoyed such strong growth for so many years, and we'll continue with this approach and philosophy.
We've had two questions on inventory. The first one: Are there any particular clients or products where we've made large inventory investments? Look, we don't talk about clients or products per se, but in terms of industries, look, the investment has primarily been across the agriculture and automotive industry. More specifically on products, we have over 1,000 products, and the investment has more or less been in the raw materials that goes into building the finished goods of those 1,000 products. There is. It hasn't been made across the board, but primarily in agriculture and automotive related products. The next related question is if we're seeing any early signs of normalization in supply chains that may lead to an improvement in cash flow conversion.
We're seeing Simon here. Shipping rates coming back, so it's cheaper to ship. That was before this drought came about in China. I don't think our inventory levels will rise from where they are now. I think over the next 12 months, they will reduce, but they won't go back to where they were historically. I think we're at the peak now. Do I see supply chains normalizing into the future? Well, if you'd asked me a day before Russia invaded Ukraine, I probably would have said yes. Now I'm not prepared to venture a forecast on where the world's going, frankly.
We've had a question here to ask if we can quantify or identify the level of opportunistic sales. The transparent answer is no. There, you know, there is a portion there that we've discussed today, and it's been, you know, well read that, you know, there were some opportunistic earnings during FY 2022, but the ability to highlight what was opportunistic is not available. What we did use was our strong balance sheet, our expansive fleets, and our ability to execute that allowed us to take advantage of those earnings and revenue.
Thanks, Ben. It's really important to look at the result of DGL as being the sum of all moving parts being deployed and the assets being utilized. Really hard to analyze or break out one element that caused DGL to have a good year. Our spectacular result has really come about through all assets working well together.
Thanks, Simon. We've had a question here. What is the opportunity across the three divisions, noting that active customers are up from 1,200 to over 3,000?
Endless. Limited only by the number of hours in a day.
What we've tried to also establish in our acquisitions announcement today is a further integration of how the offering the services and products we offer to our clients can be provided by more than one division. We do operate as a group, and we're trying to establish that to the market that we don't operate this business as three silos. They all work together. Resources get deployed across and in all, we can offer our customers a better service. There is a significant amount of opportunity there to increase the services and products we provide our customers across all three divisions and across the geographies that we reside in.
Yeah. Thanks, Ben. Once again, I sort of go back to the presentation. DGL is exposed to industries across Australia and New Zealand that are doing well. With our assets and our capital, we are well-positioned to further grow our service offering to our already extensive customer base.
Thanks, Simon. We've had two questions specifically on urea. They just wanna understand how we're tracking in terms of sourcing Technical-grade urea.
Thanks for that. The world urea markets are in chaos. We're looking at Incitec Pivot. I understand that they're closing down their plant in November. We are holding strategic quantities of technical-grade urea. Once again, that's just one of the raw materials that we are holding at higher levels than we have historically, simply as insurance against supply chain disruption.
Thanks, Simon. We've had a question here on visibility over forward orders. What kind of forecast do we have from customers in terms of what they require for the year in terms of holding high levels of inventory?
Without going into details, our forward order books are solid. I was asked the question before, how have we traded over the last two months? We've traded well. In looking into the future, I don't see any storm clouds as far as our forward orders are concerned. Once again, we've been able to demonstrate to our customers over the past 12 months that we are prepared to spend our capital on raw materials to be the provider or the supplier that they can depend on.
Thanks, Simon.
The next question. You read it out please, Ben.
What signals has DGL received to say that the earnings run rate is declining, which would be required to say EBITDA will be flat year-over-year?
Well, we haven't really. What's happened here is, FY 2022 was a wonderful year, and there may be the expectation out there that we continue that same rate of growth. You know, we're going to great pains here to ensure that we dial down expectations. We are committed to growing the company, but once again, the company will grow. I'll see to that, but once again, it might not grow or it's unlikely to grow at the same rate that it grew in FY 2022.
Thank you. Property asset values. How conservative is your AUD 160 million of property assets, and how are they valued?
It's not conservative or optimistic. They're third-party valuations from seasoned valuers. I think the revaluation came in at an increased AUD 31 million. They're good properties. I simply see them as fair value.
Thanks, Simon. We've had a question here about utilization of people and assets.
Mm-hmm.
How does it compare to twelve months ago?
White hot, flat out. I'm not quite sure of the correct expression, but obviously, you know, we are suffering labor shortages as everyone else is. No, we're enjoying very high rates of utilization. Some of these companies that we have bought will bring in further capacity, which we will quickly absorb. To answer the question, we're running at historic high levels of utilization across the group. Right. I think that's all. Thank you everyone for joining the call, and I look forward to talking to you again, probably in February or March after our mid-year results. Thank you very much.
Thanks, Simon.