Earnings Call: H1 2015

Jul 29, 2015

Good morning. Thank you for standing by and welcome to the Rexel Second Quarter and Half Year twenty fifteen Results Webcast. At this time, all audio participants are in a listen only mode. I must advise you that this webcast is being recorded today on Wednesday, July 29. I would now like to hand the webcast over to your presenter today, Hussie Provost, Chairman and CEO of Rexel. Please go ahead, sir. Thank you very much. A very good morning, ladies and gentlemen, and a warm welcome to our second quarter and first half twenty fifteen results presentation. I am joined today by Catherine Gjoa, our Deputy CEO, and I will start the presentation with the highlights of our performance in the past three six months. Catherine will give you the details from a financial perspective, and I will come back at the end to give you a few concluding remarks and confirm our full year targets before opening the floor for questions. Let me begin on Slide three with the highlights of the quarter. In the past quarter, we posted sales of over EUR 3,400,000,000.0, up 8.4% on a reported basis. This increase was boosted by a strong 9.6% currency effect, mainly attributable to the appreciation of U. S. Dollar versus the euro. But on a constant same day basis, sales were down 1.6%, including the copper effect. Excluding this impact, sales were down 1.8% on a constant same day basis. This drop mainly reflected a sequential slowdown in North America, which is largely attributable to a 32% decline in sales in the Oil and Gas segment. Our sales in Europe were up 1.5%, which represents a good sequential improvement over the 0.1% decline recorded in the first quarter. Despite the slowdown in organic sales in North America and the impact of Cable on our gross margin in Europe, we posted a sequential improvement in adjusted EBITDA margin, which stood at 4.4% in the second quarter compared to 4.1% in the first quarter. And to protect our profitability going forward and further improve our adjusted EBITA margin in the second half, we've implemented a series of measures, more particularly a cost efficiency program in North America, which I will detail a bit later in this presentation. We posted solid free cash flow in the second quarter. We actually generated €104,000,000 before interest and tax, which is the equivalent of €66,000,000 after interest and tax. And finally, we continued our efforts to optimize our financial structure with the successful placement of €500,000,000 in notes due in 2022, which allowed us to refinance U. S. Dollar notes due in 2019 at a significantly lower coupon. On Slide four, you have the highlights of the performance in the first half. First half sales reached more than EUR 6,600,000,000.0, which represents a 7.8% increase on a reported basis. But again, there was a strong positive 8.9% currency effect, which means that on a constant same day basis, sales were down 1%, including a negative copper effect of 0.1%. Excluding this impact, sales were down 0.9% on a constant and same day basis in the first half. Our adjusted EBITDA margin stood at 4.2% in the first half, which is lower than last year, where we had 70 basis points higher EBITDA margin. And net debt at June 30 stood at €2,600,000,000 Important to realize is that, that debt in the half was impacted by a strong negative currency effect of €134,000,000 Consequently, the net debt to EBITDA ratio stood at 3.2x at the June versus 3x at the December. Lastly, we confirm the financial targets we announced in February. We expect actually to be at the low end of the range. And I will give you a bit more insight in what's behind that outlook in my concluding remarks. And that brings me then to a geographic perspective on the results. So starting with Europe on Slide six, which represents 54% of our total sales. In Europe, sales were up 4% in Q2 on a reported basis and 1.5% on a constant and same day basis. France in France, representing one third of Europe, our sales improved sequentially as they were broadly stable in Q2 after a 3.6% drop in Q1. This sequential improvement reflected higher cable sales. There's also the benefit from an easier comparable base last year. And as a matter of fact, in general, construction levels in France remain quite low. In The UK, sales were down 2.3% on a constant and same day basis. If you exclude impact of branch rationalization, then that is 1.8%. This drop is actually mostly attributable to a lower impact of project business in our mix in the quarter. Sales in Germany confirmed their return to growth, rising by 1.7%, in particular, reflecting a solid industrial end markets and higher cable sales. In Scandinavia, sales continued to post solid growth of almost 8%, with Sweden up 8.3%, Norway up 10.2% and Finland up 3.3%. And in other European countries, performance We have some strongholds like Belgium and France and Austria, where sales was up respectively 62.1%. In Southern Europe, Spain posted double digit growth, thanks to both strong domestic and export activity. Italy posted 2% growth, but Switzerland was down 2.8%, impacted by lower pricing, which is entirely related to the evolution of the Swiss franc, while volumes were actually stable. In The Netherlands, conditions remained difficult with sales down 3.1%, which marks a significant sequential improvement over the 13.2% drop posted in the previous quarter. Slide seven summarizes our performance in Europe in the from a half year perspective. So first half organic sales were up 0.7% and adjusted EBITDA was down 6.5% in euro terms. Gross margin was impacted in the second quarter by Cable for two reasons. First, Cable sales were up in volume. And as Cable sales carry lower margin, there was a dilutive mix impact. Second, cable prices faced heightened competitive pressure during most of the quarter with a negative impact on the gross margin. So OpEx were under tight control and actually partly offset the negative impact on gross margin. And as a result, adjusted EBITDA margin as a percentage of sales stood at 5.6% in the first half, down 45 basis points year on year. Let quickly comment on an acquisition we made in Belgium. Slide eight actually gives you the details. We recently acquired Electroindustry and Akoustique, which allows to strengthen our market share in Belgium. This company is an electrical distributor based in the Antwerp Port and in a way it's a beachhead into the port's industrial zone, and it benefits from strong industrial end market exposure. With around 30 employees and three branches, Electroindustry and Acoustique posted sales of €15,000,000 last year, with a profitability above group average. This summarizes the European story. So let's move now to the other side of the Ocean, North America. On Slide nine, you have the details for the second quarter. Sales in the region were up 12.8% on a reported basis, which of course reflects a strong positive currency effect of €223,600,000 mainly due to the appreciation of U. S. Dollar against the euro. On a constant and same day basis, sales in the zone in the second quarter were down 5.9%, which mainly reflects the strong deterioration of demand in the Oil and Gas segment with 32% lower sales as well as lower copper sales. End U. S. Sales were down 4.6% on a constant same day basis. And let me give you the main components of this drop. Oil and Gas represented around 3.4 percentage points as sales to the Oil and Gas segment fell 33% in the quarter in The U. S. Lower Cable sales represented 1.4 percentage points and there's also the impact of the branch network optimization, which I will explain a bit later in detail, which accounted for another 1.2 percentage points. In Canada, sales were down 10.3% on a constant and same day basis. And also here, would like to share with you the main components. Oil and Gas represented around 2.9 percentage points as sales to the Oil Gas segment fell by 29% in the quarter. Lower Cable sales represented 2.4 percentage points. And there was actually also an impact of lower photovoltaic sales, which represented another 3.4 percentage points. So that gives you the perspective on the second quarter. From a on Slide 10, you'll find the details for the first half. Organic sales in North America were down 3.3 on a constant and same day basis and 3.9% on a constant and actual day basis. Gross margin improved by 20 basis points in the first half to 22.2% of sales, which is an improvement driven by pricing efficiency initiatives generating higher commercial margins that were implemented in Canada at the end of last year and optimization across the board on back margin. The bad news came from OpEx, which actually grew by 1.8% in the first half, while sales decreased by 3.9%. As a result, OpEx as a percentage of sales grew by 105 basis points in the first half to 18.6% of sales. This increase mainly reflected the lag between the slowdown in sales faced in Q2 the adjustment measures to be taken in such an environment. But remember, there is also still the impact, as we flagged last time, of higher logistics costs related to the transformation program, which has been underway and ongoing. And I will detail in the next slides the cost efficiency measures we have implemented, and that will produce actually positive effects in the second half to deal with that reality. Adjusted EBITA margin, the first half dropped by 90 basis points to 3.6% of sales, obviously, as a consequence of that OpEx situation. Slide 11 details the cost efficiency measures I have just mentioned. In The U. S, we have taken some drastic actions and decisions. First, in the second quarter, to deal with the OpEx challenge, we decided to optimize our branch network through by merging 23 branches with other existing branches in the same commercial regions, and we also closed another nine branches in Q2 for profitability reasons. Second, we reduced the full time effective base by two thirty seven people in Q2. And third, we decided to streamline even further our initial plan to create and reconfigure regional distribution centers. We now plan to have 13 at the end of the year, two fewer than initially planned. And the combined effect impact of these measures and actions give us a total estimated OpEx saving on an annualized basis amount of around EUR 20,000,000. And of course, in the second half, we'll start benefiting from that. In Canada, on top of the implementation of our pricing initiatives to improve gross margin, we've also taken additional cost measures such as implementation of an absence no pay program in Western Canada and Quebec and further adjustment of health insurance costs. Now I think we covered here the North America business quite extensively. So let's move now to Slide 12 with an overview of Asia Pacific, which represented 10% of our sales, starting with a view on the second quarter. So sales in Asia Pacific were up 18% on a reported basis, reflecting a positive currency effect of EUR 37,600,000.0 on the one hand and a positive scope effect of EUR 18,200,000.0 on the other hand as a consequence of the impact of the acquisitions we made in the past. On a constant and same day basis, sales were down 1.1%, a slight improvement over the minus 2.5% we recorded in the first quarter. Performance in the region was mixed with sales in Asia up 1.6% and sales in the Pacific Region down 3.8%. In China, sales were up 0.4%, but you have to take into account the significant drop in wind sales. As a matter of fact, if you exclude the wind, sales were up 4.2% in the quarter. In Southeast Asia, sales were up 5.7%, driven by high end non resi business and Lighting projects, which more than offset the lower sales in the oil and gas industry. In Australia, sales were down 3.8%, a sequential improvement over the 7.5% drop recorded in Q1 and reflecting continued low project activity as well as the impact of the branch rationalization program we implemented in Australia. If you actually exclude the impact of branch closures, sales were only down 4.5%. And New Zealand sales were down 4%, again, a slight improvement over the trend we've seen in the first quarter. On Slide 13, you'll find a summary of our performance for the first half. Organic sales were down 1.7% in the half. Gross margin stood at 18.4%, which is lower than last year due to the impact of low activity in Australia. OpEx rose slightly by 0.4%, represents 16.4% of sales in the first half, which is a slight increase over last year. Adjusted EBITA margin dropped by 110 basis points to 1.9% of sales. And again, the main reason for that is the impact of a weaker performance in the Pacific Region. So we've done the Tour du Monde, so time to then get into the details, the financial details, and nobody is better placed than Catherine to do that. So Catherine? Thank you, Rudy, and good morning to all of you. The table on the left hand side, I am on Slide 15, details the evolution of our sales year on year in the quarter and in the half. Our reported sales were boosted by a strong positive currency effect of 9.6% in Q2 and 8.9% in H1, mainly related to the appreciation of the U. S. Dollar against the euro. Our sales also included a slight net positive scope effect of 0.4% in Q2 and 0.3% in H1. Organic sales were down 1.4% in Q2 and 1.2% in H1. You can see the breakdown of both figures on the right hand side of the slide. In Q2, copper represented a positive effect of 0.2% versus a negative effect of 0.4% in Q1. Overall, in H1, copper had a negative effect of 0.1. As previously commented by Rudi, organic same day sales, including the copper effect, slowed down in Q2 at minus 1.6% year on year versus minus 0.4% in Q1, leading to an H1 growth of 1%. The calendar effect in Q2 was a positive 0.2% versus a negative 0.6% in Q1. Overall, in H1, calendar had a negative effect of 0.2%. Slide 16 details the evolution of our profitability since the beginning of the year. Our adjusted EBITDA margin in H1 stood at 4.2% of sales, Q2 showed a sequential improvement at 4.4% of sales versus the 4.1% recorded in Q1. Nevertheless, the 4.2% margin in H1 represents a year on year drop of 70 basis points, which is detailed in the table. Gross margin in the first column dropped 30 basis points in the half to 24.3%. This mainly reflected a drop in European gross margin in Q2, largely due to lower gross margin on cable sales and to a lesser extent, lower gross margin in Asia Pacific. Both impacts were partly offset by improved gross margin in North America, notably in Canada. The second column shows that our OpEx increased by 40 bps to 21.1% of sales 20.1% of sales. This mainly reflected a strong increase in North America, mostly attributable to higher logistic cost in The U. S. And significantly lower activity in Q2 due to the oil and gas segment. In addition, our OpEx in The U. S. In Q2 were also impacted by a bad debt charge of EUR 2,900,000.0. As already mentioned by Rudy, we have taken necessary measures to reduce our cost base, both in The U. S. And Canada. In Europe, we continue to exercise strict cost control and OpEx as a percentage of sales dropped by 20 basis points in H1. The combination of the 30 basis point drop in gross margin and the 40 basis point increase in OpEx resulted in the 70 basis point drop in adjusted EBITA margin that was previously mentioned. We target a year on year improvement in adjusted EBITA margin in H2 in line with our full year 2015 guidance. Let's move now to Slide 17 with our P and L statement for the half year. Let's start from our reported EBITDA of EUR 2 and 75,400,000.0, down 7.3% year on year. Our PPA amortization stood at EUR 8,600,000.0 versus EUR 7,600,000.0 last year. Other income and expenses amounted to a net expense of EUR 59,200,000.0 versus EUR 33,700,000.0 last year. They include EUR 36,800,000.0 of restructuring costs versus EUR 22,600,000.0 last year and EUR 19,100,000.0 of goodwill impairment versus 6,300,000.0 last year. The year on year increase in restructuring expenses is mainly related to our North American operations. The goodwill impairment charge is mainly related to our operations in Australia for EUR 10,300,000.0 and to our operations in The Netherlands for EUR 8,500,000.0. Operating income stood at EUR 207,600,000.0 versus EUR $256,000,000 last year. Net financial expenses amount to EUR 139,400,000.0 versus EUR 91,700,000.0 last year. This included EUR 52,500,000.0 of one off costs related to our financing optimization operation that took place in Q1 and Q2. I will expand on that shortly. Excluding these EUR 52,500,000.0, net financial expenses were down 5.2% year on year. Income tax amount to EUR 25,000,000 versus EUR 52,400,000.0 last year. The rising tax rate from EUR 31.9 last year to 36.7% this year is mainly due to nondeductible goodwill impairment losses recognized in 2015 as compared to 2014. As a result, net income from continuing operations stood at EUR 43,200,000.0 versus EUR 111,900,000.0 last year, and net income from Latin America discontinued operation represented a loss of EUR 41,700,000.0 and is detailed in the appendix five. Recurring net income stood at EUR 133,400,000.0, down 8% year on year. Slide 18 details our free cash flow before interest and tax in the quarter and in the half. In Q2, we generated solid free cash flow of 144,200,000.0 before interest and tax, a significant improvement over the EUR 94,500,000.0 of Q2 twenty fourteen. This was mainly achieved through tight control of working capital. So this cash flow generation in Q2 allows us to post positive free cash flow before interest impact in the half year of EUR 2,400,000.0. In the first half, the working cap improved by 70 basis points year on year from 12% of sales 14 to 11.3 of sales in H1 twenty fifteen. Improvements in payables and receivables more than offset slight deterioration in inventories. Our growth CapEx amounted to EUR 51,200,000.0 versus EUR 41,500,000.0 last year. Slide 19 presents the usual bridge of our net debt over the quarter and over the last six months. During the quarter, we paid an interest charge of EUR 36,500,000.0 and an income tax charge of EUR 41,800,000.0, and our net financial investment was a limited outflow of EUR 9,800,000.0. During the half, we paid an interest charge of EUR 76,600,000.0 and an income tax charge of EUR 75,600,000.0. And our net financial investments was a limited outflow of EUR 20,000,000. Our net debt at the June stood at a little over 2,550,000,000.00, up EUR 3 and 43,400,000.0 year on year, on which almost EUR 134,000,000 is due to negative currency effects and EUR 51,000,000 came from the financing optimization one off already mentioned. Let me inform you about the outcome of the choice in dividend payment that we proposed to our shareholders. 59% of them opted to receive their dividend in Rexel shares. As a result, dividend paid in cash on July 1 amounted to EUR 91,200,000.0. Slide 20 details our net debt at the June. We have three bonds, which represent over 50% of our gross debt and our securitization lines represented more than one third. Our senior credit facility is undrawn and constitute a reserve of EUR 1,000,000,000, which we can tap if necessary. Our financial structure is sound with strong financial flexibility. We have an average maturity of four years and no significant debt repayment before June 2020. We also continue to reduce the average cost of our financing on gross debt by 85 basis points from 5% in H1 last year to 4.15% in H1 this year. I will detail on the next slide the successful placement of EUR 500,000,000 of euro senior notes that was completed in May and allows us to refinance at a lower cost an existing bond. Lastly, our net debt to EBITDA ratio stood at 3.2 times at the June. The ratio at the June is traditionally higher than the one at year end because of the seasonality of our business. We confirm that we intend to be a three times or less at the end of the year. Last May, as indicated on Slide 21, we issued a new bond of EUR 500,000,000 with a seven year maturity and a coupon of 3.25%. This was used to redeem our USD 6.125 senior notes due December 2019. The nominal reading as redemption was EUR 442,500,000.0. As indicated earlier, the one off charge recognized in our Q2 net financial expenses stood at 33,000,000 and the refinancing generated net present value of EUR 14,400,000.0. The successful placement and the refinancing came on top of the straight repayment in Q1 of our EUR 7% senior notes due December 2018. These two operations combined will generate significant savings in interest charge totaling 41,000,000 on an annual basis. The average interest effective interest rate on our growth rate should stand at around 4% in 2016 based on the prevailing interest rate at end June twenty fifteen. This compares to an average effective interest rate of 6.7% in 2012, as you can see on the chart. These operations demonstrate our continuous efforts to improve our financing structure and reduce our financial expenses. Let me now hand over to Rudi for his concluding remarks. Thank you, Catherine. So we go straight to Slide 23 in order to give you an update and a bit more color on how we view the two key factors that impact our sales and profitability. On the one hand, sales to the Oil and Gas segment and on the other hand, copper prices. Concerning Oil and Gas, we mentioned in this presentation that our sales to that segment declined strongly in Q2 as a result of the suspension or downsizing of several projects in the wake of falling oil prices. And as mentioned, the impact was particularly strong in our North American business. Given this performance, we now estimate that sales to the Oil and Gas segment in the full year could fall by between 25% to 30%, which is actually equivalent between 1% to 2% of our group sales. With respect to the copper prices, the evolution has been below our expectations. As you see on the right hand side of the slide, prices in dollar terms were down by 17% in Q1 and over 10% in Q2. Current prices are currently at around 5,500 per ton. And assuming that this price remains constant in the second half, we estimate the following impacts at USD 1.12 per euro because there is currency, of course, you have to take into account. So at USD 1.12 per euro, circa 0.5% on sales, a drop of circa EUR 13,000,000 in gross margin and a decrease of circa six basis points in adjusted EBITDA margin. And at USD 1.07 per euro. So Silica 0.3% on sales, a drop of around EUR 8,000,000 in gross margin and a decrease of around four basis points in adjusted EBITDA margin. So that's the sensitivity analysis we've made and factored in our working hypothesis for the remainder of the year. Having said that, let me conclude on Slide 24 with an update and remarks and comments related to the targets for the full year. To get straight to the point, we confirm the financial targets we announced in February and are in a position to be more specific right now. We confirm these targets, but we're at the low end. And actually, view of the first half performance, detailed today on the one hand and the lower than expected copper prices and performance over the oil and gas sector. On the other hand, we expect to be at the low end of the range represented in February. And the way we express this is that we expect an organic sales decline of maximum minus 2% for the year and an adjusted EBITDA margin of at least 4.8%. And regarding cash flow, we stick with our at least 75% of EBITDA conversion rate before interest and tax, which corresponds to an around 40% of EBITDA conversion rate after interest and tax. The adjusted EBITDA margin target for the full year 2015 obviously represents a year on year improvement in adjusted EBITA margin in the second half, building on the sequential improvement we recorded in Q2. I think we've been very clear today about the cost efficiency measures we're implementing, which should contribute to us achieving that target. And on the gross margin side, we have very specific action plans in place to maintain the momentum we've seen in increasing in the first half. And our teams are mobilized and incentivized to that end. Lastly, we did not reiterate our dividend policy in today's press release as we do not repeat it every quarter. But as there was a question or a comment of an analyst this morning, I just want to make sure there is no misunderstanding. And for the record, reaffirm here that our dividend policy is unchanged. So we stick with the policy, as you very well know, of distributing at least 40% of recurring net income, and you are very well aware of our track records in the past couple of years in that sense. So thank you very much for your attention. We are looking forward to your questions. Go ahead. And your first question comes from the line of Lucie Carrier. Please ask your question. Hi. Good morning, Rudy. Good morning, Catherine. Thanks for taking my question. I have a couple. The first one is actually on the European margin and you've explained obviously that you've seen an impact on gross margin from the cables or higher cable sales. But I have to say compared to history, the variation seems very pronounced. So considering that European margin normally is kind of a rock for you in terms of profitability, how should we think about the evolution of this margin for the rest of the year, especially if we continue to see strong copper sales? Second question I had and maybe you're talking you're targeting a higher second half margin an improvement year on year on the second half margin. So if I follow you correctly, you're expecting to achieve about close to 5.4% margin in the second half. What are the can you detail what you see as drivers of this margin improvement in the second half and as an improvement year on year? And then just finally, wanted to come back to your initiatives in North America. You spoke about initiatives put together in the second quarter, but I had the feeling that some of the branch optimization was already kind of part of the broader investment program that you've been carrying since the end of twenty thirteen. So what is new in the initiatives in North America? And when you talk about the €20,000,000 savings annualized savings you expected to reach, is that just from the new initiative? Or is that for the entire transformation program that you've been carrying in North America for the past two years? Okay. Thank you, Lucy, for those questions. I'll let Catherine answer the European question about cable all the elements in that equation. Let me get into your second and third question first. On your first question on your second question about the drivers of the profitability improvement in the second half, there's a number of considerations. One, on gross margin. We simply assume that we will continue the momentum we have in gross margin across the board. In that sense, we consider the negative impact of Cable in the second quarter not as a trend, but as an event, which has led us to very specific rules of the game in terms of driving that business and dealing with that business in the second half. On the OpEx front, clearly, the most important there's two sides. One is in Europe. It's about OpEx discipline and continue to fine tune and streamline. But the biggest part is what we are doing in The U. S. And in that sense, third question is related to it. What I talked about earlier is actually somewhat new because Brian McNally and the team went through a very in-depth assessment of their of the productivity of their branch network. We came to the conclusion that during that exercise, we actually could merge 23 branches with existing branches in a number of commercial areas. We took out headcount, we took out a few management layers, we simplified the go to market model. As a consequence, we could reduce headcount with two seventy three full time equivalents. Having realigned the branch network, we tested all the hypothesis on the logistics network, eventually ended up with a decision not to invest in the DC in Texas, which is also related to the oil and gas situation and not to invest in a DC in Northeast Ohio because that's mostly an industrial logistics platform we need to support our Rockwell business. And we actually can also manage that through a network of super branches with the right inventory to serve large customers with a distinct profile. So this has been, in the second quarter, a very significant effort to align the logistics and the branch network optimize wherever we could. The total impact of that is indeed $20,000,000 better OpEx picture on an annualized basis. I mean simple answer is that you could take half of that $20,000,000 and that's coming into the second half. The other thing to mention is that is the evolution of transport cost. Actually, we see a positive evolution there. In Q1, we still had $3,200,000 extra cost that became in Q2 1,400,000.0 We expect that, that will disappear in the second half and therefore, will help us definitely in the comps. Also important to mention is that we will also expand. This is also about resource reallocation. We're adding a DC in California. We're going to add three to five branches in the first phase. Platt branches, we use our Platt franchise there and Platt has shown close to double digit growth in the first half and we think they will continue to drive that. So there is also return on investment there on the OpEx side that we factored in. And all that together gives us indeed the confidence that even with assuming that sales in North America and U. S, in particular, will be down in the second half, we think somewhere mid-, even high single digit decline due to that severe impact of oil and gas, that with that even with that profile, we can drive the EBITDA improvement. And I didn't talk too much about Asia Pacific. Also there, there's a set of measures to make sure that we end up where we need to end up. So that's actually kind of the working hypothesis. And I think I answered through this answer also your third question. So I would hand over to Catherine here to give you a bit more insight in the European gross margin profile and the relationship with cable or all Yes. So the cable market was very competitive in Europe. We have a strong cable sales in H1, notably in France, Germany, Sweden, but also Spain, Netherlands and Italy. Cables represented in Q2 and H1 around half of the GM drop. The pressure in Europe on cable gross margin start to ease in June. Obviously, it is too early to commence on July. But we have in our perspective to more resilient H2 in terms of GM in the second half. Thank you. Sorry, could I just have one follow-up, please? Actually two small ones. First on the €20,000,000 savings that you've spoken about. So if I understand well the €20,000,000 savings are the net savings versus the expense you have for this transformation and they are coming on top of your previous investments program. Is that correct? Yes, it is correct. Okay. Thank you. And there is a restructuring associated with that because obviously, if you go that far to take out the headcount I mentioned and streamlining the operations, there's an element in there, which actually was not there three months ago where we discussed. And maybe, Catherine, you can No, no, just to repeat, it's an annualized basis. We started at the end of Q2, so it's annualized. So it is not all in 2015. There will be a part also, obviously, in H1 and 2016. Exactly. And the other thing is how much restructuring exactly do we have associated with this? Restructuring in North America in H1 was EUR 10,800,000.0, which explain more or less bulk of the part, the increase in H1 in restructuring. You have seen that we have invested EUR 36,800,000.0, which is an increase of EUR 14,000,000 versus last year. And we are planning now to have a restructuring cost for the year of EUR 60,000,000, more or less in line with 2014 level. Thank you. And just sorry, the last follow-up is on the recovery of the margin in the second half. Is there obviously also an element of that coming from Europe, I mean, not only from cables, but potentially from better mix, notably France maybe at the end of the year? Yes. I mean, you hear both of us saying yes. So indeed, we assume that this cable situation we faced in Q2 will not repeat itself in the same way and in that magnitude in the rest of the year. And yes, depending on which country grows faster or behaves better, we could have some there's some mix effect, yes. But the weighted average of all that, again, for Europe is reflected in the working hypothesis that we will see slight growth with gross margins holding up, strict OpEx control and management and therefore Europe remaining the rock you were talking about before. I think the European rock is very solid And there's no reason to believe that, that would not be the case in the second half of this year. Okay. Thank you very much, guys. All right. Thank you. Your next question comes from the line of Denis Moro. Please ask your question. Hello, Denis. Hello, everybody. It's Denis Moro, UBS. Three questions, please. The first one relates to actually the number of branches in The U. S. That came down by 6%, which is quite intense. Can you detail the main locations and end markets which have been affected by this cut? Secondly, could you detail the price effect excluding the copper price effect during the first half or second quarter? And lastly, could you update us on how your market share has developed in Europe, given all the efforts that you make on your cost base? So do we see some gains or losses in some countries? Okay. I'll let Catherine deal with your price question in a minute. With respect to your question about U. S. Branch network, I really don't have a map of The U. S. Right here with all the cities and the states. So we I cannot answer that question right now. To make a long story short, the logic is very simple. If we have too much brick and mortar and too many branches in the same place by regrouping and reconfiguring, we think we can do the job in a more cost effective way. And that also includes examples where before there was a JEXPRO branch and a Rexel branch that we would use the same branch, the same building and give a place to both teams and banners in the same location, which we didn't consider in the past, but which is part of this consideration. With respect to your question about market share in Europe, let's just quickly go to the countries. So we know for a fact that in France, we slightly increased our market share in the first half. If I take this by end markets, we probably were stable in industry. We slightly gained in the non resi area on the back of our larger medium sized and larger project business. And I would say in line with market in the resi environment. In Germany, where industrial the industry represents one third of our sales, we know for a fact that we did better than the market. The market was up about 4% ish. In the first half, we were up about 5%, 6% in industry. In the C and I space, stable. On a total country basis, maybe slightly lower, but you need to realize that we are mostly active in Southern Germany. And in Southern Germany, we actually increased our number of active customers, gained share on the back of the improvement of the service levels of our Mayzak warehouse. So overall, I mean, after four or five consecutive months of sales growth in Germany, we think we're in a pretty good place from a market position standpoint. In The UK, I will call it broadly stable. We've made some inroads on the industry side. At the same time, in some metropolitan areas like London, where we are not as big as our average market share in The UK, we mathematically could have a negative impact due to the fact that the non resi market in London has been more buoyant than in other places. But at the same time, you take the weighted average of all that, we see that we see good growth with ten months in the resi market. So again, I think weighted average broadly stable. We know it in Scandinavia that we're gaining share. I mean, we've seen there now continued high single digit, even double digit growth. We are growing in Austria faster than the market. I think in Switzerland, we've done a nice job in dealing with the collateral effects of the Swiss franc because volume wise, we're doing well. I think in Spain, we fully benefit from the recovery in some places. We had some growth in Italy, although in Italy, we're only present in a few provinces. So I would say, in Belgium, we're beating the markets. In The Netherlands, I think right now, we're start we stopped losing relative to the market. So I think in Europe weighted average, but again, we do not have all the data yet. Lot of those data come with three months delay or sometimes even six months delay. But having cross referenced this, cross checked this with suppliers, which we do on a quarterly basis, I think we're in a pretty good place in Europe overall. That's quite good. Before the follow-up, still the pricing question and the copper versus non copper effect. So, Catherine? So copper was negative, same day sales, minus EUR 400,000.0 in Q1, positive 0.2% in Q2, giving an H1 at minus 0.1% in same day sales. And Q2, obviously, we have a mix effect because the copper price was minus 10% in minus 10% in USD and plus 11% in Europe. Okay. And for the price effect on the other goods excluding copper Is that something? Slightly positive. Excluding cable sales, it's 0.2%. 0.2%, yes. Okay. And just one follow-up question on the reorganization in The U. S. If you were to quantify the progress and the completion, what would you say? Are we at 60%, 80%? No, no, We're doing very well. On the Eclipse IT side, we're pretty close to finalizing Wave four. There is a Wave five. Wave four will be completed in Q3, Wave five will be completed in Q4. So by the end of the year, we can call the Eclipse conversion done. And actually, we're accelerating the development of a digital platform, an e commerce, e business platform as we are a bit ahead of schedule on the ERP side. So we think that we actually can even be in a better position from a commercial perspective and an operational perspective at the end of the year in terms of the platform we need for future growth. On the logistics side, well, you've heard me talking about the fact that we're now focusing on implementing 13 DCs rather than 15. There's no purpose in itself in building warehouses and adding brick and mortar. So we've been continuously looking for optimizing, aligning the branch network with logistics network. For example, I'll give you an example, the Rexel C and I business is now organized as a dedicated business unit. We have eight districts there. Each district has what I would call almost a dedicated hub, a dedicated DC. So in the alignment, the better alignment between the commercial and the operational management structure, we have made more progress. So having said all that, by the end of the year, we can also consider this logistics program, this network optimization program as done. And I can say we will move on with life, so to speak. So the third element in all that is because this transition process triggered some extra cost, as I explained. On the transport cost side, in Q1, we were still EUR 3,200,000.0 higher, Q2 EUR 1,400,000.0. That will also disappear in the second half as we promised in previous calls. So I think we will be able to start 2016 with a clean sheet of paper in that sense. Your next question comes from the line of Margaret Paxton. Please ask your question. Can I just ask quickly on North American oil and gas? I think some of your peers are talking about the decline flattening out. I just wanted to ask what you're seeing there in terms of trend? And then just to clarify your comment to Lucia earlier on about the cable sales in Europe being an event not a trend. Just to clarify, do you mean that you don't expect such a high dilutive effect from the cable sales? Or do you mean you don't think it will be such a high portion of sales? And then finally on North America being a clean sheet next year. I think you've been asked this sorts of times before, but in 2016, what kind of margin range are you thinking about when you say a clean sheet? Okay. Well, let me start with North America oil and gas question. Yes, there's different schools of thought out there. I mean, I spent the whole week last week in The States. So I talked with a lot of suppliers and customers and we look to this oil and gas business in and out. Look, we are careful and that's why our working hypothesis for the second half is that we will be still down somewhere between 2030%. I mean, of course, we're in two sides of the oil and gas business. With the Rexel Inc. Banner, we're more upstream. But we've seen in the first half a drop in the rig counts with more than 50%. Now indeed, some people will say that this drop will not be as severe or will not continue in the second half and there's maybe something to say for that. But as a matter of fact, 80% of our upstream is project business, not MRO business. So if you're more on the MRO side as a supplier or a player, then you could have slightly different assumptions. But as we are more on the project, the CapEx side of all that, we prefer to be careful and we extrapolated the second quarter trends, the actually the exit run rates we've seen in June to be more specific. Our JEXPRO banner is more active downstream, but also there, we have not we have avoided to dream ourselves a miracle. So we stick with more with quite conservative assumptions there. And by the way, downstream, given the profile of the business, there's also some negative impact on adjacent businesses, industrial business like OEM and the metals business, which are affected by that oil and gas situation. So our assumptions are what they are as on the basis of what I explained. The same is true in Canada. The only thing in Canada is that we see some recovery of mining. Mining was a very was a big drag on our performance last year. So we see the potash mining business going the right direction. And it looks like I mean, our assumption is that we will gradually be able to offset partially, I guess, the negative oil and gas impact in Canada by an improvement in mining in the second half. On Cable Europe, again, I mean, let's call it spade a spade. We saw increase in Cable sales. In some cases, we didn't like the gross margin that went with it. So we're going to take I mean, the instructions to the teams in charge are to take smarter decisions in making trade offs. And the working hypothesis is that they will take smarter decisions in the second half. So that's more a trade off issue. And I'm confident that we will be able to do so, which brings me then to your last point about U. S. Well, we're not going to talk about 2016 at this point. So it's too early. We have an Investor Day at the February. And at that time, we'll answer your question. Okay. Thank you very much. Thank you. Your next question comes from the line of Andreas Willi. Please ask your question. Yes. Good morning. I had a follow-up question on the cable issue again. I mean, I understand that you discount cables to get electrician through the store as a teaser and obviously then you get more volume elsewhere and that's kind of a trade off you have to take. Was that really the issue in Q2? And so if we then have less discounting in cables in Q3, will that have a negative impact on market share? Or has the whole industry gone into a bit of a price war in Q2 on cables and everybody will stop doing it in Q3? If you could just elaborate on the difference between the two things, what is Rexel specific push for market share relative to industry price competition? Okay. Thanks, Andreas. Well, it's definitely not a teaser for the attrition story. It's very simple. We were able to conquer a few big projects in which the cable component was significant. And I mean, of these projects were quite low in, I would say, initial profitability because some of these projects over the lifetime then improve in terms of profitability, but through other product categories, but let's not go there. So it's not a teaser for electricians case, it's a specific set of projects that we took in the second quarter, which were didn't have the right profile and we learned from that. There's no reason to extrapolate anything. I insist on that. It's true in general that the cable business and the project based construction cable business is a very competitive place and that it indeed takes very tight rules in the way we do the arbitrage, we make the trade offs in terms of investment in terms of gross margin versus volume. But again, I insist there is nothing structural here that you should extrapolate for the sector or the cable industry. Thank you very much. All right. Thank you. Your next question comes from the line of Bruno Solor. Please ask your question. Yes, good morning. I would like to know please the evolution of the discounts that electricians are getting from you? If your listed price was 102 years ago and they get X percent of discount, how is this evolving? I'm not sure that I understand fully your question. Mean our business is not a discount business. Our business is a value added I know it's not a discount. Value added service business. So the way we manage pricing because at the end of the day, that's what this question is about is a very structured process where we segment the markets and on the basis of that segmentation, velocity of products and appetite or acceptance of price sensitivity of customers or types of customers, we actually have a differentiated pricing policy. And one of the reasons why actually we see we are confident that in the second half, our gross margins will remain intact in comparison with the first half is that we think that our pricing metrics and pricing methods are sufficiently sophisticated to deal with the market demand and the market reality. To put it another way, are your customers having more, let's say, bargaining power over you than before or less? No. I mean, this is not about bargaining power. I mean, it all depends on the end market. I mean, when we are in the nonresi space, we have kind of two types of business. There is the business of the contractors and installers, the small and medium contracts and installers, that's, call it, regular business with the normal pricing models and mechanisms. Then there is the high the big project and large contract business, which indeed could require us teaming up with specific manufacturer to make sure that the offer is competitive, but still profitable. So yes, that's a different type of business where the pricing project where in this case, project pricing, which is in itself a science, has a very different profile than the over the counter sales to, for example, small electricians smaller electricians in branches. So and that's non resi. In the resi space, you actually have even more counter sales, over the counter sales and smaller contractors and electricians. And in the industrial space, this is very much direct customer business. We do direct business with Alcoa of this world and Alstom's of this world. There you very often have contracts, which are based on a TCO model, total cost of ownership and productivity improving all over time. So their price is only an element in a productivity equation. So I mean all so we cover, of course, the whole spectrum. But if your question is, has something fundamentally changed? No, nothing has fundamentally changed. Okay. Thank you. Thank you. Your next question comes from the line of William MacKay. Please ask your question. Yes. Good morning. Thank you for taking the question. I wanted to come back to North America, please. You disclosed that oil and gas relates to 10% of your revenues in the region and also that the decline is in the order of 20% to 30% or 25%. So that would account for around 2.5 percentage points of the decline. And yet you're reporting an organic decline much larger than that against the backdrop where many of the construction markets are recovering. You've highlighted that you've gone through a branch consolidation and a significant branch consolidation in your restructuring program. I wonder, can you specify what the impact on your growth was from the consolidation of branches on top of the consolidation of oil and or the reduction in oil and gas demand, therefore giving an indication of what the underlying growth you're seeing relating to the construction market is? Because it's very hard for me to equate the declines you're seeing against some of the positive moves that we're seeing in some of the construction end markets. Well, mean, I think the detailed answer on your question is on Page nine. I'm not going to repeat that, but you find all the details here that we can share. It shows you what's coming from oil and gas, what's coming from lower cable sales, what's coming from branch network optimization. In U. S. And in Canada, what's coming from oil and gas cable and TV. So that is the answer. With respect to the different end markets, look, clearly, oil and gas is a big part of our industrial activity. As I was mentioning before, on the sector side of our business, have some collateral for oil and gas in our OEM and business and with some of our larger metals customers, which has some extra negative effects, which is not in that direct oil and gas number. So that's more indirect impact. On the resi side, you're right, resi is up in North America, but I need to remind you of the fact that resi in our balance of sale is only 5% of our sales. So I could imagine that there are other distributors out there or companies out there who are more upbeat or have better numbers, but that's just because their profile is different in that sense. And on the non resi side, it's a mix. Again, not every state in The United States behaves in the same way. We know for a fact that West Coast and Northeast are up in non resi and we are benefiting from that. There's other places where that is not the case. Of course, we also are not in every state in The United States. So it could be that in some places where there is growth, we are actually not present. So it's hard to draw a line. But if you compare our numbers with usual suspects and some of them already published their numbers, I mean, take Wesco, for example, and I could give other examples, but take Wesco, for example. I mean, what's happening in their industrial business and in their non resi business is definitely not very different from what's happening in our case. Of course, they have a utility business we don't have and their utility business is up. They have a big government business we don't have and they have, and that business is for them also up. But so if you kind of start peeling back the onion, so to speak, and you look to the underlying trends, I think we can explain why we are where we are. And I think you have the answer on your question. Yes. Thank you for the detail on Page nine. It's very clear and thank you for the answer. If I can sort of similarly come to the question around The United Kingdom and France where you've highlighted the France, you've highlighted the cable sales growth factor. But how would you characterize the trend in the market within the French market? There's been some optimism around certain sub segments or verticals in construction in France, but it may be too early for you to see it. Do you get any sense of any shift there in a trend? And again, with regard to The United Kingdom down 2.3%, I think you highlighted and we know the regional difference between London versus the rest of the country. But do you think you're losing share anywhere there? Or is there anything specific that would suggest you were lower than the overall market trend? Well, let me start with France. So on France, there's some very early indicators that would point towards a gradual improvement, although we have not seen that because we're late cycle and those indicators are pretty much driven by early cycle businesses. The working hypothesis is that if those early indicators would continue to behave consistently in the next month that 2016 should be a better year than 2015. I'm not going to quantify that, but I'm qualifying it, let me put it other way. You need to take it by end market. I mean, the industry on the industrial side, as I said, we pretty much behave in line with the market. In non resi, we're in the larger project business. Now being in the larger project business has triggered some of that cable business and we talked about it and that's where we gained share, but with a gross margin impact that we discussed. On the resi, it's pretty much a renovation play. It's not a new construction play. So in France, we know we're gaining market share slightly. We continue to reinforce our position. We think we're in the right place, in the right categories, in the right end markets. So the jury is out. I mean, France has the French market has been quite erratic. Over the past twelve months, we sometimes had a month where we started to believe that it was getting better and then the month after, it didn't continue. So also the summer period is going is a difficult period to use as a proxy for improvement. So I'm not going to make statements about it. And in The UK, well, I think I explained where I think we are. We're making inroads on industry. We have reinforced our MRO portfolio. A non resi, I think we as we are underrepresented in the larger London area mathematically, there negative is impact effect on market share calculation. And on resi, we see this with Denman's and that is actually going the right direction. Now, I mentioned that also before, there is still an effect of comparison with last year because in The UK, we actually We closed actually did not necessarily merge them, we closed some of them, which now has an impact. So there's some impact there and that will be still there this year. And next year, of course, the baseline will be more equal. So I don't think I can give you more detail at this point. This is as much as we know. Thank you very much for the comprehensive answer. Cheers. Thank you. Cheers. Thanks. Thank you. Your next question comes from the line of Pierre Bustard. Please ask your question. Yes. Good morning to both of you. I have two questions, if I may. The first question, would like just to come back on your initial comment on your dividend policy, which has not changed, I understand that. But could you consider a cut in the dividend? Or will you maintain it as EUR 0.75 per share like you did last year? That's the first question. The second question is regarding the M and A pipeline with only one acquisition this year. When you look at your competitors, Sunnipar, you made a number of acquisitions, including in The U. S. So if you can have more clarity on the acquisition pipeline and in particular in The U. S. For Vexcel. Okay. On dividend, I cannot give you more details. Obviously, year at the end of the year, when we come together with the Board, we decide on cash allocation. Our policy is, as we call it, our golden triangle. Is, on one hand, our commitment to shareholders to pay an attractive dividend, which we've been doing consistently. There is the notion of having an envelope for M and A up to EUR 500,000,000 a year On average. And you need to see this over a longer period. And then there is the third corner of triangle, which is staying below three net debt to EBITDA ratio. So we are in that triangle, not every corner is the same every year, but that's a decision and a discussion for February. And at that time, we give you an update. As I said earlier, explicitly, the dividend policy is the same policy as at this point as we had, and there's no need to question that in any way. On M and A, we have a number of cases in the pipeline, not only in Europe in The U. S, also in other places, even Europe. We'll keep you up to date every quarter. We have a pipeline. I must admit that in The U. S. That given the kind of a challenging market that this year we give full priority to finalizing all the transformation program and optimize the go to market model. So that, as I said earlier, we have a clean sheet of paper next year. And I can tell you that in that context, M and A is a key priority. So no more comments at this point. Of course, it takes two to tango when you're trying to conquer an M and A target. If you make comparisons with other companies out there, I mean, they do not necessarily have the same strict investment criteria as we have. They also strategically do not necessarily use the same parameters as we do. So I would not draw conclusions about our M and A portfolio or pipeline or external growth strategy on the basis of those comparisons. Actually, for a fact, and I'm not going to give names, there's some targets out there where we actually were involved and we said no, because we thought that the price was too high and or the quality of the company not good enough to sustain an investment case. Thank you. Thank you. Your next question comes from the line of Christophe Querron. Please ask your question. Yes. Good morning, everybody. Just two questions, if I may ask. First one is about Europe. Could you come back a little bit more on gross margin evolution per country? Even you don't give any details, but give us the flavor of what's going on in dedicated and local markets, please? And going back to also Europe, could you give us what's going on with Germany where you have done a lot of reorganization in terms of supply chain? Then just could you give us where you are in terms of evolution vis a vis the logistics more particularly on the impact on the profitability? Second question is around Asia Pac. Could you give us more granularity on what's going on per country on what is particularly the trend as it seems that China is in a more difficult environment, notably regarding pricing and what are the main focus of Rexel as going forward into this region of the world? Okay. So with respect to Europe gross margin, I mean, I cannot and will not give you details by country. But I mean, there is this very simple rule that there is a correlation between the level of concentration of a market and our market share position on one hand and gross margin entitlement or EBITDA entitlement, I have to say, on the other hand. So in Europe, clearly, we're in a strong position because there's many countries where we are number one or number two in relatively highly concentrated markets, which of course give us EBITDA levels, which are quite significant. If you're in a country and you have 30% plus market share, the EBITDA levels can easily be high single digit. And if you're a 20% market share player, again, still the number one or number two, you get into nice mid single digit EBITDA level. So that logic, that rationale, and I we expressed that to you at roadshows and at these kind of calls, they're still valid. And I think you will have to do it with that rule of thumb to judge the quality of the detailed execution in the countries. I mean, a reason why we are confident for the second half is that we believe that we're in a good place there. With regards to Germany, yes, Germany, the Meisach DC is up and running at very good service levels. We have full rates of above 90%. We have increasingly more satisfied and convinced customers. Actually, our new customer count is exceeding our previous track record in the past six months. We see productivity improving. We see better quality of inventory. We're actually expanding the SKU range. Actually, we're adding 50% more SKUs to offer a better value proposition to our customers. So in general, I think we do well. The transport cost also there is going down. Warehouse cost goes down, obviously, as productivity improves. So one of the reasons why we've seen us consolidating and even reinforcing our market position in the South Of Germany, which is our stronghold is related to that. So I'm very pleased. We also have a management team that is up and running. We have a new leader. We have a new lady joined us Joy who joined us running the logistics. We'll have a new sales director September. So Patrick Berard and the team there have done a nice job in solidifying the German management structure too. On Asia Pacific, let me start with China. We are an 80%, 85% Industrial Automationsystem integration player. So far, we have not been too much affected by the negative trends in resi or non resi or in general. I'm going to be honest, we expect some pressure in the second half on sales, even in our Industrial Automation arena. That's also cross validated with some large suppliers. But that also has to do with the fact that we don't want to take too much risk on working capital. We could grow much faster if we would give in on receivables, which we don't want to. So there's a trade off there. Moreover, there's this whole wind business that was huge last year and in comps terms is a bit distorting the picture. So without going into the details, we're going to talk every quarter about what the China business is with and without wind. Otherwise, we're not going to give you a good perspective on our core business there. Southeast Asia is an interesting case where despite the fact that half of our Southeast Asia business is oil and gas, with the same pressure, I mean 20% -ish decrease, we're able to compensate 20% decrease of 50% of our business in oil, which is oil and gas with a similar increase in the non oil and gas part. So our Lighting projects do well, the acquired companies perform better than the business case. The high end non resi larger project business in the hospitality area is doing well. So that's a balancing act, which works for us. Know the situation in Australia, I think we extensively talked about this. Australia is not anymore the country where we saw double digit drops and complete decline of sales because of the mining situation. And I think step by step with the new team there because also there we have a new leader. And also there, we upgraded the management team. I think we're increasingly more seeing momentum building of improvement. New Zealand is, I guess, too small to talk about. It's not changing anything in the total scheme of things. So that's a quick update on Asia Pacific. Okay. May I ask two other questions really quick, if I may? Sure, sure. Go ahead. Yes. First one is related with the hiring of someone at the strategy rule. Could you elaborate a bit more of what is your view about this hiring of such people in terms of repositioning Rexel and what is the rationale behind this hiring? That's my first question. And second question, sorry to come back on Europe, but it's a bit to me that despite the organic growth coming back, there are not such an impact at the margin. You explained a lot what's going on there. But if I remember well what you have said into the past, you always mentioned that you need to have allocation or a good direction coming from Germany, France and U. K. In order to come back with a certain level of leverage on the profitability. Is it still the case? Or do you plan plan to come back on such a level at the operating leverage in 2016 more than in 2015, putting your guidance at the bottom of the ones you mentioned at the beginning of the year? Let me start there in Europe. Again, if you take Europe, you need to understand what's happening in each country. You mentioned UK and Germany as a decisive factor. The more decisive factor is actually France. And relatively spoken, France is still underperforming kind of the overall European performance. So that is, of course, thinking about next year and the evolution of our European business, a key factor. If we get France back on run rates that are at least at European level and even hopefully better, I will talk about the hypothesis in February. I have there's no reason to doubt that we would not be able to get to the leverage the operation operating leverage you're talking about. By the way, if you factor out this cable impact on gross margin and you look to the business on the not just taking the view of a quarter, but taking the view of the last eighteen months, so to speak, and you do sensitivity analysis, again, there's no reason to believe that we would not be able to continue with a strong Europe generating the profitability that you expect from it and we expect from it. On the hiring, you need to see this in a broader context. We just finished with the Board of Directors an exercise called Rexel twenty twenty, which is a comprehensive strategic plan, which we discussed with the Board. And we will actually, while we have the Investor Day in February next year, give you an update because that will be the frame of reference for our discussion at that time. And in that context, we decided to actually reinforce the executive committee with a dedicated leader for everything that will be related to the execution of the Rexel 2020 strategy, which covers obviously strategic initiatives. It covers M and A, it covers new business development, it covers expansion an expansion program. So we thought that we would benefit from having a dedicated leader with a dedicated team going forward to drive that effort. And that's why we recruited Thierry de la Rue, who is actually not coming from the sector, but has been is a real international cosmopolitan leader, worked for many different companies and different industries, also has a consulting background earlier in his life. And I think this is part of creating a team that is the right blend, the right mix of expertise and experience like people like Patrick Berard and at the same time, new people coming in, giving a new perspective, a new impetus and enriching their Excel HR value proposition, so to speak. Okay. Thanks a lot for all the answers. Thank you. Thank you for the questions. Thank you. There are no further questions at this time. Please continue, sir. Okay. Well, I'm really pleased with the interest. A lot of questions, and I would call them all very good questions. And I hope on your side, you will call our answers very good answers. So with that, I would like to thank you for joining the call. Wish you a great day and a good summer. And for those who take holidays, wonderful holidays. So thank you. Thank you. That does conclude the webcast for today. Thank you for participating. You may all now disconnect.