Good day and thank you for standing by. Welcome to the NKT Q2 Report 2022. At this time, all participants are in a listen-only mode. After the speaker's presentation, there'll be a question and answer session. To ask a question during the session, you will need to press star one and one on your telephone. You will then hear an automated message advising that your hand is raised. Please be advised that today's conference is being recorded. I would now like to turn the conference over to your speaker today, Alexander Kara. Please go ahead.
Thank you. Good morning, everybody, and thank you that you take the time to listen to our Q2 results. With me in the room, I have my CFO, Line Andrea Fandrup. Further, I have Basil Garabet here, the CEO of NKT Photonics. This will Basil's final meeting for the results. Just let me say some words. Basil started in 2015 in NKT and developed NKT to the status where we are. He was obviously instrumental and welcome, Basil. You have today the chance to ask him some final questions in case you have any. Welcome, Basil. Let's go to the key message for Q2 and the highlights.
In Q2, we had an organic growth of 11%, which was based on good performance of Solutions application, where service and accessories was low in revenue and in EBITDA compared to a strong Q2 last year. We had a record high backlog because we could book finally the Champlain Hudson Power Express project in the U.S., which brings power from Canada to New York and the South Auckland second system. Based on this backlog and the new project which we have awarded, we have decided to strengthen our manufacturing capabilities in NKT Solutions, and we expand our high voltage production capability in Karlskrona.
As you know, we have also entered into an agreement to divest NKT Photonics, which will be the final step in the process to fully focus on NKT on the core business, the power cable business. If you look at NKT, the divestment. On 24th of June, NKT entered into an agreement to divest NKT Photonics to Hamamatsu, a company in Japan. The closing transaction is subject to regulatory approval and we expect that this take place later in Q1 2023. The Q2 results of NKT Photonics was that we grew 18% in revenue. The EBITDA was -EUR 5.8 million, which was negatively impacted by the transactional cost of EUR 6.1 million of the divestment. This led to a net result for discontinued operation of -EUR 9.1 million in Q2 2022.
NKT Photonics is presented as discontinued operation and as asset held for sale from Q2 2022. If you look at the performance in Q2, the development. We have the positive financial performance of the Solutions business line with where we executed orders or which we have won in the last quarters and years. That was a positive development. Also, we grow the revenues in application, whereas the EBITDA was negative impacted on increasing costs, and we may come back later. Service and accessories, revenues and EBITDA was lower against a very high comparison of last year, same quarter. We had temporary higher costs in Q2 in the accessories business.
Overall, H1, if you look at, we grow from EUR 640 million to EUR 700 million, 9% for the half year and on EBITDA from EUR 73 million to EUR 80 million, which is 11.4%. If we look at the Q2 Solutions results, we have increased activities and worked on different projects with each different technology. Just to name here some, East Anglia THREE is an MI technology project. BorWin, Dogger Bank, Shetland, SuedLink 525 kVDC. Then we worked also on AC project, Ostwind and Troll, which is Troll for power from shore. A good mix of projects with different technology.
In April, we commissioned the power cable for Hornsea 2, an offshore wind farm in the U.K., which will deliver clean electricity to 1.3 million households once it's in operation. Based on all this execution, we have a good utilization, actually full utilization of the Victoria in Q2 with various installation activities. The high backlog and also the contract awards of Solutions extension in Champlain, as we mentioned, make the decision to expand the production capacity in Karlskrona. Overall, in Q2, we increased organically by 22% and EBITDA from EUR 23 million to EUR 30 million, which is a satisfactory result. If you look at the markets, we got in 2022 Q2 two large projects awarded.
The second, SuedOstLink, which is parallel to the first order from 50Hertz and is a part of the energy transmission from the North Sea to the south of Germany. We received the Champlain Hudson Express. SuedOstLink was below EUR 700 million and Champlain Hudson more than EUR 1.4 billion. If you look at the total market in the first half year of 2022, it was around EUR 5 billion, which includes the SuedOstLink extension and Champlain Hudson Express. After the end of Q2, NKT announced the turnkey supply for the project East Anglia THREE offshore wind farm in the U.K. This is not yet in the backlog, and it's based on final notice to proceed from the customer and final investment decision.
Overall, a strong Q1 on high voltage project awarded of EUR 5 billion. If you look at our backlog, our backlog has grown from EUR 2.8 billion end of Q1 to EUR 4.6 billion in market price or EUR 4.0 billion in tonne of metal price. In round numbers, increase of EUR 2.1 million in market price and EUR 1.85 million in tonne of metal price. From the backlog we expect to execute around 10%, which means 10% out of EUR 5.4 billion. On the right side you see here the projects on which we work, offshore wind and interconnectors, and we have added now here Champlain Hudson and SuedOstLink too.
Looking on application, the revenue has increased in Q2 with contribution from various geographies where we are active. In product segments, the growth on the revenue was mainly from high inflation and primarily price, means price increase, less on volume. Despite the higher revenues, we have seen a decrease in the operational EBITDA, and this decrease is due to higher material costs in application on the metal side. We work with customers to increase prices and work on the contracts to improve the situation, and we work also with our supply chain to secure the future. We see in the market overall a slowdown in certain market segments and in particular on the construction-based segment where we deliver cables.
Overall a growth, but driven by price increases, organic growth 16% and EUR 7.2 million EBITDA versus EUR 7.6 million. Service and accessories in Q2 dropped from EUR 65 million to EUR 47 million, whereas last year we had several repair jobs. Besides the decrease of the revenues on the repair jobs in service did well on the remaining business. Of course, the repair jobs are important in terms of revenue and EBITDA contribution. On the accessories side, we are impacted by higher temporary costs, which are consequences of the footprint transfer of high-margin accessories from Cologne to Alingsås. Overall need to state here clearly, EUR 1.8 million EBITDA in service and accessory is not satisfactory and needs to be improved.
With this, I want to hand over to Line and she goes through the financial details.
Thank you, Alex. Giving the full highlight here of the income statement and just recapping what Alex also said. NKT is continuing the good growth momentum back from 2021, where we grew 15% year-over-year and actually won with 7% and now here for the Q2 with 11%. For the quarter primarily by Solutions and Applications. NKT did have a slightly lower operational EBITDA in this quarter. Just to note the comparison base of exactly as we closed off with services and accessories here, where the 2021 service and accessories business line was very strong performing. A slight decrease in absolute terms, only somewhat.
For the first half, we are at an operating EBITDA of EUR 80 million, compared to the first half of 2021, where we were at EUR 73 million. In respect of the result from discontinued operations, we're presenting Photonics as Alex went through with a solid growth and a negative EBITDA primarily due to the transaction costs. When you look at our FTE numbers comparison base full year when we ended the 2021 and until now, you'll see the underlying growth in FTEs due to of course the expected growth ahead of us and the expansions in Cologne and Karlskrona, but also some of the footprint changes in our factory layout. Moving on to the balance sheet highlight.
We saw a strong improvement in our working capital position from EUR 35 million working capital in Q1 to a very positive availability of EUR -200 million in Q2. This is very much due to the Solutions business line, phasing of milestone payments and then related to the order backlog and the recent awards. This positively impacted our capital employed position for the quarter and our ROCE also in combination with the improvement in earnings is at 4.1% compared to end 2021, we were at 3.4%. We of course continue to follow this important performance metric for the return on capital employed for the company.
The net interest-bearing debt reduced from Q1 to 2.4 in Q2, leaving the quarter at 0.2x EBITDA. Yes. Just to note also on the hybrid, you probably saw in our press release that we redeemed the hybrid of EUR 150 million on 12th September. NKT does have sufficient funds in place to repay the security, and we are, of course, considering the future financing capacity to make sure that we have enough flexibility for the growth ahead, the strong backlog and even the activities we see, and at the same time securing the right financing structure for the company.
Turning to the cash flow of the quarter, positively impacted by the working capital position, leaving us at a positive cash flow from operating activities. Investment continues at a level more or less on par with same time last year due to the expansion programs and the Solutions. As you also note from the key highlights and the report that we announced, a further expansion in Karlskrona of around EUR 90 million for next phase to go up there. The quarter closes the free cash flow at EUR 88 million. We keep the financial outlook for 2022 at EUR 1.35 billion-EUR 1.45 billion revenue and an operational EBITDA of EUR 130 million-EUR 155 million.
Geopolitical and macroeconomic dynamics at the moment means that there are certain uncertainties associated with second half. Therefore we maintain. Reiterating the key messages of Q2, an organic growth of 11% primarily driven by Solutions and applications, while sales and accessories, as expected, came down from the very favorable 2021. A very strong order intake in Q2, a record, and a very high corresponding order backlog, giving a good visibility into the future. We will expand our high-voltage production in Karlskrona further, and at the same time also this quarter the announcement of the divestment of NKT Photonics to a good future home where they will maximize the potential of the company.
With that, we will hand it over to question and answers.
Operator, we are ready to take questions from the audience.
Thank you. As a reminder to ask a question, you will need to press star one and one on your telephone and wait for your name to be announced. Once again, if you would like to ask a question, please press star one and one on your telephone. We will now take our first question. Please stand by. Your first question today comes from the line of Massimiliano Severi from Credit Suisse. Please go ahead. Your line is open.
Yeah. Hi, it's Massimiliano from Credit Suisse. Thank you for taking my question. My first question would be on the Karlskrona expansion, and if you could maybe comment a little bit on the phasing of the EUR 90 million of CapEx and on what does it mean in terms of space capacity for NKT Solutions in 2024 and further?
Yeah. Thanks for your question. The EUR 90 million, the majority of the investment will happen in 2023, a little bit this year. The capacity expansion will have approximate impact of EUR 2 net million after it is completed from 2024 onwards.
Perfect. Thank you. My second question would be if you could maybe talk about the guidance. Is it fair to say that if we expect supply chains to not get any worse than they are as of now you should be able to be on the higher end of the guidance? Or do you expect the weakening outlook for construction to be a big drag and potentially bring it far away from the upper end of the guidance.
Let me say something about supply chain. The supply chain, what we are looking here, impacts mainly the application business and the construction part of the cables which deliver the goods to the construction business. What we have seen. Let me give a little bit more color on this. What we have seen, we dropped out of Russia for material procurement, aluminum, and also from any sales activities in Russia. We have to switch to new suppliers in the market. We have seen also in the market that some supplier of metals, in particular aluminum, have seen huge price increase, cost increases on energy and gas, and even some reduced or stopped even production of their output.
We have to look for a new supplier and this also outside of Northern Europe or even Europe. This has led to an increased cost, particularly in aluminum, due to the transportation, but also on the premiums in aluminum. This is an effect which we try to correct through discussion with price increases and discussion with our customer. Also price increases you need to be able to change price based on your contracts and on the terms and conditions which are defined. We work on price increases with the customers. At the same time, we look at the supply chain, how we can secure going forward the supply chain.
We have seen a sharp increase of this cost in Q2, which we could not compensate it through a price increase. This will be not over in Q3. It will go into Q4 and work on correct these actions. That's one part in Solutions. Solutions also what we see is a slowdown in some market segments, which is related to the construction side of the cable. We have here two effects, the slowdown and the increase of aluminum in particular in Solutions. That's to say for the Solutions. On the other side, we have Service. As I said, we had an unsatisfactory Q2 in Service and Accessories.
One part is the higher cost on accessories, but it's depending also on the Q3 or Q4 results or second half that's been formulated in this way on if you have any repair or repairs. We believe that we have reached the bottom of the accessories from the footprint change, and believe that should go up. Also here, as I said, important is contribution from repair jobs. Here we have also certain uncertainty in the service business. Then on the Solutions side, as you know, from quarter to quarter, there's a different phasing in the project. It can also be changes. Based on this application, service and Solutions, we came to an uncertainty overall in the market. We came to the conclusion not to upgrade our guidance.
Perfect. Thank you. Very comprehensive. My last question would be on the repayment of the hybrid and the sale of Photonics. Now you have announced DKK 90 million of CapEx in cash krona, but you still have more than DKK 100 million left from Photonics disposal. My question would be if you have any comment on what you think could be the strategic priorities, and maybe also on the hybrid, if you think it will be fully refinanced or maybe just partly, and you'll use part of that to bring down the leverage. Thank you.
Oh, thank you for the question, Maximilian. I hope I heard all you asked, but to touch on the hybrid here and our considerations, we see a great, let's say, future here for NKT in terms of the backlog. We called the hybrid now, but we also see that there is a scenario where doing a new hybrid would be the right way to finance NKT's growth ahead, making sure that we have a capital structure that will be best fit for the years to come.
This is in the meeting right now, and I think we see a hybrid as a new hybrid as a route that is definitely something to consider.
Thank you.
Thank you. We will now go to our next question. Please stand by. Your next question comes from the line of Daniela Costa from Goldman Sachs. Please go ahead. Your line is open.
Hi, good morning, all. Thanks for taking my question. I wanted to ask on two things. First, Rikke, I guess you could comment a little bit, given the new CapEx investments, on the cadence of free cash flow that you expect over the coming years. Is that gonna be like, I guess, negative? Do you expect it to be negative in 2022, 2023, and then harvest the benefits after? Will you start harvesting some benefits a bit before? And related to this new investment actually, why did you decided to go for Karlskrona, versus, for example, going for some investment in the U.S.? That's the first part. On the second part, I wanted to ask you regarding margins of the backlog.
I guess your peers have commented recently that margins in the high voltage segment, I think Nexans said could go between 17%-24%, more towards the submarine side. They've commented that terrestrial was a bit lower. Can you comment a little bit given Champlain and Germany, their terrestrial contracts, are those more on the lower end? Do you see this kind of very high teens as a long-term possible for NKT? If you could give us some commentary there. Thank you.
Thanks for the question, Daniela, and let me start with your first question, and then I will hand it over to Alex and some of the others. The new CapEx in Karlskrona, we don't guide on cash flow, as you know. Obviously this should be a solid contributor at the end of integration to the continued future ahead for NKT also meaning a cash contributing. What we are, of course, looking into, and you know equally well as we do, is a very booming market, even with the, let's say, scarce capacity in terms of getting all projects executed as customers are actually approaching us, and even in some cases we cannot take in more orders at certain points in time.
This is an ongoing consideration in general, NKT's capacity. Therefore we will see a future where, of course, this new investment will be contributing to cash generation, but also a future where we'll continue to consider what next steps to take to make sure NKT continues to grow. On to you, Alex.
The question was why do we invest in Karlskrona, expand in Karlskrona and not in the U.S. As you will see, EUR 90 million, the CapEx is not a full factory. With the EUR 90 million we use already existing to a large extent, it's civil buildings already built, in particular the port which we have just finished. We have here the most returns from the investments. We can practically, as I mentioned earlier, with the EUR 90 million, we can increase revenues in 2024, from 2024 onwards by around EUR 200 million. Within, let's say, a little bit more than a year. It's relatively low CapEx compared to the revenues and fast.
This is the decision for Karlskrona. Also, of course, we have delivery obligations from the complex which we have in hand. Now, the question regarding the margins, the 17%-24%, if you look at our Solutions business, we have a onshore business and a offshore business. Where we said, we moved the lower end of the high voltage onshore business to 25 to that is in order to improve the profitability. Then we work further on improvements in the factories.
As we execute the project with improved margins, which we are seeing coming in, due to the improved supply demand balance, we also expect the growth go up with the margin over time. That is, yeah. I think that hopefully answer your question.
Sorry. Can I quickly follow up on actually on the answers on both? You mentioned the EUR 200 million incremental sales on Solutions. Can you recall us, 'cause there was already some incremental sales from the prior factory expansion that you had announced, I think mid or end of 2020. At full capacity, I believe in the past you used to guide to close to EUR 1 billion. At full capacity, what's the level that we should think full capacity now with all the once all the factory expansions are done?
Yeah. I mean, let me then, in 2021 prior, we decided to increase the capacity. We ran Solutions around EUR 700 million-EUR 750 million. We started the first investment where we announced EUR 150 million. We said on the item 49 in between to EUR 1.1 billion from 2023. From 2023, EUR 1.1 billion, and from 2024, we said now that we have the EUR 90 million investment, which brings us to EUR 1.3 billion per year on revenue.
Yeah. Of course, pricing is a big part of this mechanism also. That's embedded in what Alex said.
Exactly. Pricing is a big part. Of course, the question is how much you have turnkey or supply only. This is round numbers.
Mm-hmm. On your second answer, sorry, just to clarify, because I'm not sure I fully understood. Do you agree that terrestrial is lower margin than submarine? Do you agree with the bands? I think Nexans has mentioned sort of terrestrial more on the low teens, submarine, more on the sort of high teens to 20%. Just, I'm not asking you to give a value, but does that make sense in broad ranges when we think about the mix?
I mean, if you talk about terrestrial land cable, AC onshore land cable, classically has a lower margin than a sea cable. Also here we're seeing increasing demand going forward on 400 kV AC in Germany. That could also have a positive impact. In general, AC onshore is lower. If it comes to DC 525 Kv, you have seen that we announced the SuedOstLink extension. Here I would say margins are not necessarily lower than a sea cable.
Understood. Thank you very much.
Thank you. We will now take our next question. Please stand by. Your next question comes from the line of Akash Gupta from JP Morgan. Please go ahead. Your line is open.
Yes. Hi, good morning, everybody, and thanks for your time. My first question is also a follow-up on projects margin. I note you had fully utilized vessel in Q2, but I'm wondering if you can talk about current capacity utilization rates in overall solution business in all aspects of manufacturing and installation. Is there any scope of improving margins from full saturation in future that was perhaps not the case in Q2? I mean, basically, I want to understand when we look at future margins and solutions, how much improvement can be driven by price mix, or could utilization also play a role versus last quarter?
That is a big and complex question, Akash. I mean, of course, the result is impacted by utilization and also on the mix of the factories. We are increasing our utilization, and we have a high backlog, and so we have still potential, for example, on 33 kV AC, for 2022-2023 and onwards. On installation, obviously with more volume, and in Karlskrona and in extrusion, and more turnkey projects, we also have a higher utilization of the Victoria, which helps us. We had a good utilization in the first half, and we see a little bit less in the second half.
Overall, the increased revenues on turnkey has logically and consequently an impact on the utilization of our vessel.
Thank you.
I think we.
Yeah.
Yeah, please, Akash.
I had a follow-up on applications margins. I think you explained well that you have some contracts and you had some cost increases. I wanted to understand more on the timing of when you will be allowed to revisit or increase the pricing, like when these contracts will roll over. Maybe if you can tell us more about the timing of accessories margin improvements going forward.
I mean, as you can imagine, opposite to our Solutions, we have hundreds of contracts. The terms and conditions are varied from them. That is not a quick fix. We have increased the prices substantially in Q2. The revenue increase was practically from price. Whereas the volume was flattish or slightly increased. We are able to increase prices, but there's also limitations, and these limitations are set by the contracts and the terms and conditions with the customer. We work on that, and at the same time, we see that we can improve from the procurement side to come to more normalized levels on materials, which then of course would help us.
Also, now we work also on the footprint movement. These are not yet, let's say, activated. This is still ongoing. Overall, we work on it, but it will drag into Q3, and we are not sure when we are through, to be honest.
Thank you. My final one quickly is on the Rhine River water levels, which are again back in headlines in recent weeks. Is it fair to say that could also be a headwind in the second half, which is incorporated in the guidance? Or are you better placed now versus few years back when you had impact from lower water level impacting your transportation cost?
No, the Rhine River will not impact us at all in Q2, as we have no load out of cables from Cologne. We have delivered Ostwind 2. There will no impact at all. Impact unfortunately is only for the nature and the fishes.
Yeah. Just to Alex, in Q3, but,
Sorry, Q3 and Q4.
We are in a better position because we have a, let's say, a barge that actually can handle shallow water better than the situation back in 2018.
Yeah, that's correct. Yeah. Good that you mentioned that. We have a barge which is designed for low waters in the Rhine and for that to cope with the Rhine River. As I said, we have no load outs in the second half of this year.
Basically, this is not a risk for guidance, for this year.
No. That is risk zero.
Thank you.
Thank you. Once again, if you would like to ask a question, please press star one and one on your telephone keypad. To ask a question, star one and one. We will now take our next question. Please stand by. Your next question comes from the line of Claes Westerlind from Nordea. Please go ahead. Your line is open.
Thank you. I hope you can hear me.
Yes. You have a question for me.
Yes, I do, actually. First of all, I just want to say thanks for the years within NKT and the many quarterly presentation, Basil. I hope you are very happy about the new owner of the company. Not least, now you know if you were the prettiest person in the bar.
Absolutely. Yes. Yeah. We definitely were the prettiest girl in the bar.
Good to hear.
Yes. Very good.
Okay. Going to the cable activities. Alex, maybe you could give some comment on the pipeline, both for the more near term, so 2022, but also the pipeline for the next year. That would be my key question.
The pipeline, you mean in Solutions, I guess, huh?
Exactly. Exactly.
I mean, I said before, half year there was EUR 5 billion. Then we have the U.K. CFD round, where we are successful to sign a contract with them for East Anglia THREE. Of course the remaining, what is it around 1.5-5.5 gigawatts needs to be awarded. And as you know, there's some contracts where there may be pre-agreement, some customer may play the market. And we have of course here some chances in the U.K. CFD, and there are several other projects in the near future which come.
The statement of EUR 7-8 billion on average for 2022, 2023 and 2024 is valid for all segments, interconnectors, offshore wind, power from shore. There is plenty of opportunities. That is good for industry. That means the supply and demand that has shifted, and we can now really be more selective. The more there are more projects in the market which we can cope with them, you know. Enough, I guess, for the whole industry.
What kind of projects would you say no to? Is that purely due to timing and price? Or this being more selective, what does that actually mean?
No, I mean, timing of course, you need to have a production capacity available. Otherwise, unless the customer is willing to change their schedule. It depends also on the other cable companies, competitors, if they can deliver or not. Timing, availability of capacities is a prerequisite unless customer can change. The second is then price. There's enough projects in the market so we can say, okay, this price is attractive. Also of course depends on conditions in the contract and is it, yeah, these are the two main criteria.
Okay, that makes sense. Just a final question regarding a hybrid, Line. You mentioned that there is a scenario where you could issue a new hybrid. What scenario would that be?
I think what we are very much considering here is market conditions, right? Now we called the hybrid we had when it was also stepping up to a coupon above 10%. There's of course, let's say a pain point to when we would finance NKT's future with a hybrid. We do think the hybrid, if market conditions are good, could be a good way to finance the growth ahead of us also.
that would mean if you're going to do a greenfield, a new factory. Is that what you mean?
No, it's not actually a little bit broader than that. It's not a trigger when we're waiting for FID. It's actually making sure we have the finance, the right capital structure for NKT from when the hybrid is eventually called on first of September. There we want to have a hybrid in place or some other kind of financing to make sure we can continue with the good momentum we have.
Oh, sorry. Just to be sure. Does it mean that without a new hybrid, your balance sheet is not strong enough to get these, some of these large orders?
No, it doesn't mean that in a complete linear context. It means that we see a future where NKT has a lot of opportunities to grow and continue the momentum, and we wanna secure that. If and when we make a new hybrid, it is to secure that. It's not for a trigger event and it's not as a standalone to secure. We have a stronger balance sheet.
Okay, thanks.
Thank you. We have one more question. Please stand by. Your question comes from Massimiliano Severi from Credit Suisse. Please go ahead. Your line is open.
Yeah, hi. Thanks for taking my follow-up. It's a very general one. If I think about the cost of transportation of a cable, do you think that first of all, if you could give us a sense of how much of the total cost of a project would be in order to transport a cable from Europe to the U.S.. The follow-up would be if you don't open a factory in the U.S., do you think that in the future you will still be competitive enough to transport a cable from Karlskrona to the U.S. even after your competitors have opened their U.S. factories? Or would that mean that you would basically focus on Europe rather than on the U.S.?
Yeah. I mean, if you look at transportation, I mean, you need to look at the cost of a vessel or the day rate of a vessel, and then you take the numbers of days which you need to take from Karlskrona to the U.S.. You need to consider also, even if you have not a factory, take our competitor. If their vessel is currently in Europe, and they have a job in the U.S., they need also to go with an empty vessel over to the U.S., load the vessel, load the cable in the U.S., and bring it to the transporter.
It's unlikely that maybe at a certain point in time that a competitor has permanent vessel on standby in the U.S. so because they have also projects not only in the U.S., but that is of course a little bit assumptions. You need to calculate the cost or the price of a vessel at the day rate and then some days, and then you need to put it in relation to the total project size. Obviously small project connecting two islands, I don't know. I'll just say now EUR 10 million or so would not make sense. That is clear. But for a large project with several hundred millions, the transportation costs can be maybe absorbed in the overall package.
Of course, you need also to see what is the drawback. If you have a factory in the U.S., you need also to ensure that you have the load. There's plus and minus for both. But we think we can deliver projects in the U.S.
Perfect. Thank you.
Thank you. There are currently no further questions. I will hand the call back to you.
Okay. Thank you very much for your time to listen to this, to our results, and wish you, everybody, a good day and talk to you soon. Bye-bye.
Thank you. This concludes today's conference call. Thank you for participating. You may now disconnect. Speakers, please stand by.