Earnings Call: Q1 2020

Apr 28, 2020

Ladies and gentlemen, welcome to PetSafe of Vermont's 1st Quarter 2020 Revenue Conference Call. I now hand over to mister Rodrigodi, Deputy CEO, and group CFO. Sir, please go ahead. Thank you. Good evening, everyone, and thank you for all your presence tonight. I hope you are in a good shape. I must see this call from France within the store relations team connected from home too, a quiz that you know very well and Junior as involved. So we get, I'm going to present you some, to present you, sorry, the group review as of March. End of March 2020. And what we have done to, cover this crisis and the outlook for where we, what we believe we can be, we can say today. I'll leave, first of all, to squeeze the hand draw through to be some precise stuff in advance of my amon macarons, quick read. Thanks, Felipe, and good evening. All opening also that all the participants to the Coca Cola safe and healthy in these extraordinary times. So when it completed event for the first time from hope. Finance surplus release related to the first quarter of 2020 revenue and the update on for the COVID 19 for our business has been released today after the closing of the market. As you've heard already this presentation will be followed by a previous session. Slides are available in the Perfron's website with the Investor Relations Press Release Documentation section, and a replay of the conference call will be available later today. On the gift card site in the same section. Today's call contains forward looking statements that address our expected future performance and that by their major address matters that are uncertain, his expectations of the debt factors and uncertainties that could cause actual results to differ materially from those described in the forward looking statements. For detailed, a detailed description of the factors and the consequences, please refer to the risk and control section in our universal registration dayton in 2019 available on Twitter from our website. Now I'll turn the call over to Olivier. Thank you, Chris. Before we go investing in Q1 to I would like to share with you some key facts and to be reflecting the achievements made during this period in this extraordinary time that we are living today. So if you move to the to the side 3, what what we have done over this last week, we have tried to prepare successfully pilot performance to weather the storm and to manage the after crisis period of the future in certain number 9. And and and you are driven to the 3 cap key priority to 5,000,000. First of all, partition number we have put in place a world system to, Ian's Asian program and Asian standard in the group. 80 Countries, around the world. We have put $165,000 employees working from home. Which is roughly 2 thirds of our operation workforce. And we are only faxes and people working there at home, at the end of 2019, but even end of January, sorry. In 6 weeks, we have been able to move, to 5000 to 150,000, people working at them. I just wanted to to stay a minute there just for you to have an idea of what does it mean and what is relevant in terms of of where for the dedication of the different team, but we are very, very proud to have done that. In doing so, what we have done, we have not only protects employee, which was the 1st priority, but we have also been able to protect by supporting brand and government, in ensuring business continuity. I can give you that roughly close to 90% of our people, of our clients are served by home working employees. It has not been so easy to to make it happen. Of course, you need to have the agreement of the client. You need to be sure on the security path. But we have been able to get the agreement of the client. And most of them are very happy to have that because the continuity of the business is is gone. People are continuing to be served. And in some case, and I'll come back to that later on, you have a sharp increase of some client activity. While you have those have decreased, but she has sharp increase, which is linked to this situation. So protecting employees, protecting jobs, but also protecting the company, So we have launched a reduction cost program on SG And A, mainly in freezing salary, freezing increase. Freezing a lot of projects, cost, mainly on SG And A to make sure that we are going to get out of this of this barrier safely. While in the meantime, with all the team of the finance team and and and support by your banker, we have been able to to secure an additional credit line of 1,000,000 adding to those we have already had also, we had just treasury. So today, we are roughly in the range of 1,500,000,000 available, credit, to support your prices. And on top of last, during these payers, we have been able to confirm our rates rating with Sonad and Poor that this complement triple B minus with stable outlook. So that's why I know of 3, 3, 3 issue, protecting people, protecting them, protecting the group. And clearly, what we call, you have work at home, the payment has been one of the main reasons to address its priority. Of course, we have, our strategy and system implemented on-site, but also we have, I would say both 7,000,000 masks that are, that have been deleted as we speak in the different countries in different centers. So that that was our key site. And, also, you know, and I can tell you, this is a it has been a a a a a huge work of this last 6 or 7 weeks. If we come back now to the figures that you see that the growth in 2020 for the Q1 was 6.2% like for like, despite the effect of the COVID-nineteen operation. And clearly here, you have 2, 2,000,000,000. Of course, we have a fantastic growth in January and notably in February that has been partially offset by flat performance in March, previous 2019 impact. In March, in fact, you have 2, 2, 4th 9, if I may say, the first, the first fortnight has been muted. The second one has been impacted by by the COVID-nineteen. If we change now to selling slides like 4. You have the detail of the figure and what I just mentioned about the like for like, which is 6.2% like for like in a positive quarter while reported in the 6.4. And it's just what I just mentioned. If we move now on page, on page 5, you have to decline this, I reckon, precise or yellow. So very few currency effects, which is in fact an improvement of the dollar, which has been which has been offset by the decrease of mainly going to be pesos and the Sanjuan pesos, but also the Brazilian real. At the end of the year to like for our growth, which is roughly 1,000,000 in this quarter. Let's move now to precisely to the different, to the different, I would say, part of the company. You you find on page 6 in detail by vision and by a cost service and specific service. What is interesting is to see that the core service and leaves hasn't been able to deliver a growth of 6.8.8%. While the specialized service only 2.2.2 is, of course, a mix of very, very good performance of Long Edge Line solution on which I'll come back in a minute. And an impact, a significant impact on TLS, where the travel ban and the difficulty to to move the fact that nobody is moving anywhere has reduced dramatically the activity in, in this part of the way, in this part of our activity. Let's move to Jengish World. So Jengish World is 4.8% like for like and on Page 7. Again, satisfactory growth in the 1st 2 months of the year, of course, very slightly lower than March, despite the first impact of the COVID 19 in North America, everything has been impacted except for Healthcare. The internet service and automotive industry. As of today, in the U. S, 90% of the employees are working at home. We had a significant growth in APAC, very strong growth in Malaysia and along Q1. And what is very promising return to solid revenue growth in March in China. As revenue are still down in UK, despite the fact that we have been able deliver growth in March linked to, to the implementation of our off-site service for the government on September. But as a whole, that is another figure. If we now move to Peter Volatan, I would say, not a surprise, double digit growth in March, despite the slowdown compared to, in March, with the 1st 2 this is the 1st 2 months. I would say very few things to say that everything is doing well in Colombia and Brazil business. And even in Mexico, that we are able to deliver growth, financial service, detailing, and internet service industry expanded at good pace. And what is absolutely amazing in this region, we have been able to very quick implement to work at home solution. And as of today, it's 80 percent of the people in this region are working at home, and which is a little, you know, significantly higher than the origin. And we are close to give you an example to 100% importable. That is absolutely amazing. As far as Europe is concerned, you have growth, which is lower, which is, which is more mixed, which is, either by regional adviser by, by, by business. I mean, that's exactly sharply, March, especially in Tumiya and Italy where about locked down strictest locked down policies. And you have an increase, which is, you can see there, you can see there is a smaller increase in of course, Indonesian will ask that it's 1 100% also working at home. It's called Navia, Turkey, Egypt, and Russia. Where we have opened last year on new site. So, another month, which is a little more mixed, and either one of them that's still good. If we move now to India and Middle East, we had a sharply decrease in March due to the drastic load down in India. Lots of sites have been closed there and during the month. We have been able to expand worker term solution, to minimize this impact roughly 6 60% of the items in India working at around 58%. We have prioritized international offshore contract. And we took the advantage of that to increase the termination of the less profitable domestic contract. We know that we had an offer, an offer issue because we are not able to to to sell all our clients. So we decided to put all of strength and also I thought on the international parts to maximize not the sales, but the results. If we move now to specialized service, it's, they're nice, as I may say, language line solution hasn't been able to deliver double digit growth in Q1. In fact, for language line information, this company is already living with working at home. It's a business model, so it's not a big change. There was an impact in March mainly for the people we're working in health care and decided to postpone the non COVID-nineteen upper to reduce a little bit of the business, but as a whole, the business we are aware of. Of course, there is a sharp decline in our Dintailments, notably in March, but also it started already in January, in February with China, where operation were significantly reduced and that is linked, of course, to the general escalation. So that's where we are at the end of, of Q1. If I move now to Page 12, just to give you ideas, what we know, we know that the margin will be negatively impacting each one. Mainly due to Q2. We know that equities is probably the worst months. May and June should start to recover progressively. This is a, this is not driven, but clearly a preclinical and we hope that May with all the policy that has been announced across Europe, but not only across Europe also elsewhere. In starting again, and we hope that we will be able to collaborate, especially in the countries that were locked down, and we hope that it will help us. Second thing, which is interesting to notice is ongoing positive financial momentum. Surprisingly, or, business development team are very, very active, even if they cannot meet the people, but doing that remotely with virtual disease, with virtual stuff, has enabled a fantastic possibility of developing new business and new client? And we think it's good for the future. We are not able to do to deliver you a guidance at this stage. We need to have a PR view of this a certain quarter to be much more precise in our figures? But if we believe that like you and the things are going to improve gradually in Q2, especially in May, June and also starting July and we are we're gonna be confident that we could, take advantage of these needs needs to with all the measures that we have taken to to take advantage of that in term of, term of commercial that I've mentioned earlier, but also in finance. And we think that we are going to, to continue to deliver, our client needs across the world and to show that telecom art is probably one of the most resilient companies of this world, of the big BPO world. That's what I wanted to let you know. I'm still, of course, open, I'm open for questions that you might have. And I'm ready to take this question. And we have a first question from Edward Stanley from Morgan Stanley. Go ahead. Everyone. Hi, Olivia. Thanks for taking my questions. I've got Sri, please. If you say April is the probably the worst month or you hope that it improves after that. Can you give us an idea of, either the last couple of weeks of March, which started to get very bad or what you're seeing in April, particularly in India, I guess. If we're trying to model that And then I'll I'll ask my question. I'm not going to answer any detail of each month, but clearly, it's definitely March is complete because March math depends on lots of when peep when countries have decided to log on to so it's difficult to read. What is clear is that, probably a trend we are going to be done, double digit, while we believe that, in May, we should be better to be probably better than that. You can see better than that. To what extent, I have no idea precisely, it's difficult to tell. So that double digit was for April rather than Q2 as a whole. No, April. I'm just speaking of April. I'm not speaking of Q2. I was interested to see the 250,000,000 cost saving strategies, which seems pretty large. I didn't realized that there were that many levers to pull. So can you tell us, you know, what specifically has amounted to us? It's an easy SG and A. By nature, it's an annual basis, so it won't you won't have that in a full year basis because and turn it to it. So what has been done, is, of course, no more trouble. Which is a significant internal impact in Teleperformance because people are traveling and traveling a lot. No more projects no more full time, no more higher, no more full time. I'm not speaking of agent, but no more, I'm speaking as a management, no more high freeze increase. No more, travel travel done. We have a lot of projects that has been freeze or significantly reduced. So, so, of course, there will be some other costs that will happen in the meantime. In front of that, we have for some development of the work at home. So, I don't know what will be the final figure at the end of the year or for 2020 because you won't have the impact of the fuel up. 250 is in the full year, but we are, we are doing that. Yes. It's a mix of a lot of things here, SG and A, SG and A, SG and A. That's the decimal tool. Okay. And on the second half of the year, the outlook sounds relatively positive. And it sounds like it's around well, comparatively positive, it sounds like this is around mainly nuke clients that you've acquired, can you give us a feel for in which verticals you're acquiring clients, why you're acquiring time to eat your competitors going first? Are they outsourcing? No, I'm not sure. So first of all, We do believe that, we need to be close to our supplier, and we have engaged a large last connection to be closed from the client. To tell you what will be the volume, exactly the volume that is going to be delivered in made sure. One that knows that, please give me the figure because I don't know But what we've seen, what we've seen is a business development, important, decision development. And we see that as very, very effective. I don't know if we gain market share of Or if it's much more a trend that has already launched, I would say, the coming on. That is happening today, but what has been decided very rarely in this crisis is to be very, very close on the trial. And, and not only, by mail, by phone, by social media, to be, to, to help people, to understand what they have to do, how to move on when you're working at home just to be close on the client because and we have a lot of testimony for clients that people are That's what I've learned. Of course, there are a few of them. Of course, and I'm, I'm not mentioning that, but there are people that are faculty, just trying to balance the stuff, hotels, transportation, all these people. This is difficult for them, of course. And we have less volume. But that's the rule. If things are, and I don't know, frankly, and I'm the one that know, please tell me I don't know how it's going down in 2, but we have prepared to take to move on is this example in 1 in each 2. That's the way I can tell you. Okay. I just had one quick follow-up on something you said earlier. The the, you said working from home will incur can you give us a feel for how much cost per agent are the capitalized costs? It's difficult to tell you. What I can tell you is that when you move so quickly, you have, of course, a time where the productivity is not perfect for us to reach some of the best but at least we have overcome this situation. We have some investment to do. We believe that there will be some CapEx needed to that. But in the meantime, as we are reducing your CapEx in development. We believe this is going to be Russia, more than positive. More interestingly than what's happening in 2020, was sure tomorrow that the level of working at home will not come back to five thousand people in the room. And I'm convinced that I don't know where we're going to stand, but we should stand probably at higher level than what we are today. 2020, 25% of our workforce. I don't know why I am not able to to to tell that tomorrow, to to do today. With clients that were reluctant to move to working at home are discovering that this is working, not for all, but this is working, and that might help. For the future and especially for the expansion of the group to know. So we have another question from Bill Anazes from UBS. Go ahead. Good evening, everyone. Thank you very much. For taking my questions. Lily, I know you've broken down the mask figures in specialized services, but perhaps can you give us the 4 quarter figures for TLS and LLS? For the first quarter. Second question was TLS store profitable in the first quarter? And in a scenario for saying, travel restrictions or a slower return, do your cost savings cover any closure of application centers within that business. And very finally, does the 250,000,000, euro cost saving program include the investments in project legal, which I assume have been postponed, or is it all incremental to that as well? Thank you. There is a bit of reduce on the project Eagle. So it's true. There are some things that have been postponed or reduced, but there is a part of it that is done, of course. About TLS, CLE. TLS is the most that you can pass as a group today. Very, very, very tough time because, finally, nobody's traveling anymore. So you have no more sales in TLS. So the impact of the price on TLS is huge. It's huge because even if the people have been able to get costs dramatically, and I can tell you that the company is doing very well, in doing so, but you have no more, you have no more sales at least for the, for the, normal sales, right, 2 sales for the Q2, I'm not sure it's going to start again very quickly in Q3. So we have some some turnover code, of course, as we speak very well, but it's more center. It's a big center. But clearly, the major impact is in internal processes in Dallas, don't, don't dream. So, but we are here to several clients. We try to adjust as much as we can. But clearly, TELUS is going to be, to be in a little time and start in Q2. Yes. That's true. Great. Thank you. So we have another question from from from Goldman Sachs. Please go ahead. Hi, good evening. Thanks for taking my questions. I have one on the employee cost, please. Given the kind of the clients facing in some of your end markets, like the travel sector. Are you considering any employee for loss fees, and is that cost benefit included in the $250,000,000? I'm not sure. No. No. I'm paying cost. It's direct cost. Most of it is direct cost. It is a margin. Of course, there are some employee reduction in SG And A that the big impact in which ones, the margin Of course, there are some up, something is called, there are some, so you have in your country where you had said a lot down. So it has an impact on the margin, but January 1st is impacted. It's much more in the margin, and I'm not sure should whoever I understood your question because you are far away. I don't know where you are locked down, but I've had time to understand the question But clearly clearly I'm just trying to understand if you've taken and the governments across Europe have, long employee for low schemes. Right? So have you have you taken advantage of any of this scheme so that you can give us a call? Yes. Yes. In Italy, Spain, in France, in Germany. But, you know, the big impact are the big countries, not least vision that this country are important, but of course, the impact of the, and clearly, we took advantage of that. Yes. The person to give us an idea what percentage of the employed costs are therefore I'm not able to answer you. I'm not I'm not able to answer you today. Especially because, rules have changed all over the months. And I think it would be clear minimum from now, but, today, I'm not able to give you a precise, you know, this is the reason to follow One of the difficulties is the fact that this crisis is evolving every day. So, everything is changing every day. And it's difficult to, to precisely, all the impact. So I cannot answer you this cannot give you some sort of pay. No problem. Thank you. And one question on working capital, please. Are you facing the difficulty collecting your receivables, especially from the hard head sector. That's all. Yes. Good question. We had some demands from people wanted to lend things there. Delay payment, but not so much so far. We have not seen major, major impact. We are, of course, looking to that very precisely. This is going probably to happen much more now. So we are very precise on that. But so far, we have seen major major impact. Of course, we are following that very precisely, especially as you know, when the Easter crisis continues in times because it's where I lie, we're a liability Wonderful. Thank you. Last one, please. You've mentioned that April was down double digits. Is it 10 to 20 over 20? I mean, it's double digits. April. You said April in the month of April, I think you said revenues were down to a double digit. Correct. Yes. I've got it wrong. Okay, thank you. K. We have another question from Laurent Gilles from Exane. Go ahead, sir. Good evening, Olivia. I would have two questions. The first one regarding cost cutting, which part is cyclical I will come back next year on which part which part is structural, I, sustainable lower SG and A, a level of cost. The second question regards, like, productivity, if people work at home normally, they are not traveling any longer. So they may work longer period of time in a day. They may be more collective. So this is going to help you going forward on that. You're right. You're right. But you're right. At the time, you put in place the working at all, the work at home, you have inefficiencies, I'm telling you the truth when you move advice, 150,000 people, 6 weeks from SunTrust to home, I can tell you, it's not done. Let's put it this way, it is. So it's now it starts to be a little more it's more, I would say, manageable, but the start has been tough. Course, and the trade activity in this time, we are not everywhere, but of course, you change all the ABs and you change the receipts. So it's a 7 of course, on the margin that this is the Cigna overall and this is partial could continue, but this is, of course, something about the structural part, of course, I don't know. Of course, most of the steps are contractual, but you discover that finally, you are able to manage this company without traveling, which is, so whether it's structural or financial, difficult I do believe that we will need a certain point of time to continue to travel, and frankly, to stop traveling, actually do since now, as we have done, since now 7 minutes or 8 weeks, even more because we start to use some mid February. Last problem was the 20th February, So it has its its control, but, but this is I'm not sure if you cannot, we I do believe that we can reduce it to 0 milligram But clearly, it's a big impact, you know, people are traveling across the world everywhere and you stop that from nothing. It doesn't impact because it's significant impact. Okay. And I have a last question regarding way your contract have been set up. So normally, you get, let's say, base fee plus a bonus depending on some KPI, you are able to fulfill, I guess that quality KPI, this time is a bit difficult to, to fulfill. So At the beginning, it was really good, but we relaunched when we get the agreement of the client, there was a discussion about to free revenues and menus. Of course, both sides. I mean, of course, to be very very close to the client to understand what's going on, local interpretation to react that all the legal team spends their time now. Seeks to free to review all this statement of work and the MAC to freeze that. Because the clients were absolutely likely to continue their tariffs. And of course, we understand that KPI could be, could be chaotic at least at the beginning and we agreed to freeze that. Okay. So you don't expect plus or minus how does that answer the clear situation? Okay. And then assuming that the lockdown are no longer in place, nobody come back to work, but still we have the economic crisis. So how do you believe the volumes on verticals with react, all your customers? You believe it's back to normal or some some I don't know when it's going to be back to normal. Today, it's difficult to tell, but the main impact of the group was much more or not for impact, ability to sustain, of course, demand impact. But the offer, the fact that, absolutely, to have a significant people because of our freedom. You can understand that it was a lockdown because there was a lot of difficulty to come to work because transportation, whether it was possible or something like that. So the main impact for us is first half, is it so far was mainly offer. The demand staff, the demand part, of course, in existing, as mentioned, in transportation, and we are significantly on decrease in transportation business, in hotel business and all that. Of course, the main impact for me is of I need to lock down, which is done or reduced, it will significantly help, I believe. So we have another question from Niccolo Tabula from MainFirst. Good morning. Can you hear me well? Yes, very well. Great. The first question would be on the productivity. Do you have any numbers on the number of calls processed, late margin being April, you can share with us? Okay. No, no, it's not free in that. The reason for it to be the main impact, as I mentioned, a crack to extend it. In some case, you have size were totally true. So you have to move this part of your side to work and to home. So So suddenly, things are disappearing depending where it's not. And this is the main impact. That was the main impact. For it to be, of course, it's, in the fact that suddenly, you have to stop the African country, where the government decided to stop, totally. After they came back, after they come back partially because they need us to, to make it, to make it work in some countries. People because we are supporting 2019 outline most of the times. So the quality impact is the fact that you In some case, you you had a lockdown. You had the total lockdown in India, but not coming in India, but mainly in India. It was a total lockdown. So you have to, we have to move quickly now at least on a little more than close to 60% of working at home. It's not happening in the day. You can imagine. And this deployment of the working at home, so, how do you manage that? Because I guess, people don't use laptops in the working station, usually. So do you do the There is a mix of what we call VUE, bringing on your own device. And and take some, try to take some, computer from, from the from the center to home, and to buy some computer because everybody's picking up the RASK Ma, as a Maxwell or nobody's speaking computer world because we have to buy, we have to buy wholesale computers. So we bought some, some of them. So it can mix of all distribution. And of course, it depends a lot of the country, the story was this one, yes. And when you said 66 percent for the 150,000 employees working at home, so that's 235,000 employees, which are operational, as you mentioned, especially. And, so what about the remaining 100,000 employees? Because last year, you had 290,000 full time equivalents and, only 10,000 is a supervisor that can work also at home, but, and we try to put maximum people in production. But there are people that are well done. They cannot work. That's difficult. And that's the, that is an issue. There are people that are working at home. And there are still people in center, not so much, but there are still people in center, where you have the social distancing to what is important, what is a key issue for us is the people that are locked down that you cannot even move. So I hope it's going to be reduced. In May and in June because we just have to rework because of the union. Okay, great. And regarding the CapEx, you don't have any rough guidance of where would you Yeah. The on CapEx, it's always the same story. It's like a let's get training. You want to stop it. It takes time. Because we are running on the, on the guidance of 7% like for like growth. So you might imagine that we may imagine that we had some project. So this project, some of them have been launched. So, you're obliged to finish and some of them have been stopped. So, I believe the reduction of CapEx will start to be to be seen in May. And, early in May, and to be much more visible in the 2nd part of the year, because, and today, I cannot give you figure because in the meantime, we, I mentioned earlier, we put much more money on the working at home. So, we have budgets This is going to be, to be significantly reduced versus the budget that the budget has, what's even versus last year. So we are growing So, it's too early to give you perspective here. Great. Thank you very much. So we have another question from Lucas Ferani from Deutsche Bank. Hello. Thanks for taking my question. So the I'll just have one left, just on the, the headwinds in terms of the revenue line what's the part that's really led by demand coming down from your clients and the part that's led from you not being able to have, the employees and having a 100% service level because it seems from a new point that actually demand is not moving much and all of the kind of headwinds to revenues from, obviously, with lockdown and not being able to have all of your employees working at the productivity at peak. Is that fair to say? I would say the 1st month, March, Street, and probably May is the main stories offer. I don't know, 2020 that, maybe 75, 25, 25, except JLS, except JLS, when it's from your projects, because which is exactly your opposite of the other story. But as a whole, I think that today is the main story and it has been the main story has been it's easier for the ability to sell. Okay. And just on the contract, again, it was mentioned previously, but just is there a part that's based, solely on what's the service level, how many calls, how many agents you have working, or is this just the base fee plus something different KPIs and mostly quality. Is there anything that can be done? There are plenty of agreements. So, I'm not aware of all of them. Largely, the idea is to share. It's much more of the volume to KPI. Of course, we cannot, be able, you're gonna be paid it should be delivered by service, but it's mainly the new ability to sell the volumes of calls and traction because now Oracle, it could be also for its non voice interaction and BPO stuff that are continuing to be to be, to develop, especially in e Commerce And Banking and all that. And the the last one on NLS, so I think you you mentioned that, there are also some headwinds there because the traditional kind of activity in health care, affected by the virus. Is there any, potential benefits from the increased activity in health care, because of the various gap, probably more people. I'm not sure if you use the word benefit for the virus, but the let's put it this way. What we saw on MLS we saw, we saw probably reduced growth. We have successful level of growth that we had, and we experienced in the first two months of the year. But frankly, I'm not really worried about LLS. LLS is going to deliver. Very good growth again this year, probably less than what we expected at the beginning of the year, but very good growth. Of course, there are some things that have been postponed. And of course, it has an impact especially in March and probably in April I don't see what's go what is going on in in May, June, it's difficult to predict, but I or at least in May, maybe in June, I believe this stuff that has been postponed with the restart. So I'm not so concerned by, you know, let's, you know, let's say different. This company is no no to work at home. Job in that 4 years now. Yeah. Yeah. Now, we are able to to to deliver. So, frankly, frankly, it's probably the less we are in part of the group, so less difficult part of the group, because I wouldn't say it's, business as usual, but close to Of course, it's not the business as a whole. People are making out, getting costs, are taking care, but they are much more in a position to much more traditional position in this part of the group. I don't know if there are other questions. Yes. We have another question from Christophe Shapiro from ODDO. Please go ahead. Just two questions for me. The first one is a clarification on organic for the Q2 because you said basically that April is down double digit. May is better. So should we implement that? It should be. Q2 will be down to to what level. I don't know, but it will be down. Yes, sure. Does it mean that it could be only, let's say, single digit decrease? In in in second in second in Q2? In May. Yeah. Because we have really double digits made. Let's say high single digit and June, let's say, even single digit, mid to high, let's say, to q 2. My point is to say the q 2 is not necessarily detreting by double digit? No, no, no, no, no, no, no, no, no, no, no, no, no, it's just because I it's the way you say it. So it means that the Q2 will not business necessarily drop by, more than 10%. Is that correct? But again, keep in mind that probably the waste is going to be done. Of course, LLS will be significantly down in this Q2. Yes. So the mix effect will close them out margin, Benoit, for sure. Probably, probably. And so if you look, let's say, at the full year, obviously, it will It is massively difficult to forecast. I mean, but Nothing. And what level of organic, the margin is going to decline? You mean that if you put a 0% organic for the full year or 2%, are you able to as a flat margin, which means that below 0% organic, you are in a I don't know, I don't know, but it seems to me difficult that we have no impact on the margin for the full year. If you have an impact, a significant impact in Q2, especially with, with Stella, to what extent, I don't know, to a lead, but it's difficult to tell country. Okay. And the last one is about China. You say that you recover in a certain extent. Do you recover the pace of normative growth that you experienced, during the last quarter over there? China was supposed to grow dramatically in 2020, so it will be kept at the beginning of the year. And we are back close to a plan. Course, we are not able to, to swallow what has been lost, but at least we are back on track. And is it a kind of specific area, if I may, which means that if you look at Iberico LATAM or unless and part of the world, so imagine that you do let's say, with a sharp decrease, do you expect this kind of area to recover, let's say, more or less fully in Q3 or Q4, let's say. What do you mean that we cover? We are going to swallow all the loss that we have. I don't believe that we are going to all the loss that we are going to cover, the reduction of the business that we are going to suffer in Q2, hope to be clearly No, it's not the cash out, but it's obviously, but the full year guidance was an organic of 7%. Are you able not really for the Q3, let's say, but for the Q4, to post the 7% organic let's say, leaving out there. Why not? Why not that the trunk is trunk is I'm not making condition today. Frankly, as I told you at the early, we are not able to deliver again today. There are so so many, so many you know, there is a guidance in sales and there is a guidance in margin. This is difficult, really difficult today to really much more stability to see that. We hope we'll be able to do that after the Q2, but frankly today, I don't want to mislead, mislead the market, tell you that things are doing well, things are doing badly, but what I can tell you is that we had a good first quarter. The second quarter will be probably difficult with the other heat on sales. I'm trying to think probably a hit also on margin that is going to be, I think, by Jimmy from Teles, notably, that's also by the lockdown. What will be Q3 and Q4? I must have said that, I don't know. We had some forecast, but I don't know what I'm sure is to see first the group is solid and have liquidity with Italy and can be well managed. And secondly, I do believe that on a commercial part, on the I mean, business development activity side, the group is very active. So I have 2 things on which I'm sure today. Okay, okay. And I'm sorry that I have to be more precise but conditioned for us. No, no, but I can fully understand for sure, The last one for me is, what's, could you help us to understand the cost, the extra cost of work at home into the OpEx because it seems to say that the operational profit margin in H1 will be much more affected by TLS But, also, by the lockdown, by the by the lockdown, the country Yes. So the lockdown is a a lack of faith, if I may. Yes, the platform, I mean. For sure. For sure. And on top of that, you could or we could add some extra cost related to work at home? I don't know if it's your first or level of productivity. So legal to make a distinction between the fact that you change your totally operational forces and what is clearly additional cost. I know what is additional cost in terms of, of, of CapEx, of laptops, and then is not dramatic, so this is not huge. So the fact that it is not working from day 1, perfectly, that strategy is able to to access today. I don't know if there are other questions, but I'm ready to take 1 or 2 last questions before I move on. Okay. So we have another from Lucas Ferrali from Deutsche Bank. Please go ahead. Hi. It was just a quick follow-up. This is some pressure for from government, on companies who are using them, the various measures to follow people. We said you're using European Countries Are you worried there might be pressure on the dividend from that side? No, so far, the French government says that Vivienne might be, provision if she decided to use to not to pay social charges or not, or use grant funds. Loan that has been guaranteed by the government, which is not our case. We didn't choose that, and we are not going to use that, especially in France. So, to show off, it's an issue, only for France, and just remind you that we have to two thousand eight hundred people in front there, she's 333,330,000 across the world. So So, question is on this one. So the board will make a decision on time on this issue. And he would be, he would know that sometime, but, the machine has been to postpone message in our assembly to end of June to meet sufficient time to make an appropriate decision by the board that will be done probably in the 3 weeks to come. The last question, I'll take it. If not, No. We have no more questions, sir. We have no more questions. Thank you to all. I hope you have understand that we are living in a complex way, especially I believe you too. So what we tried to explain is where we are to, to begin. I just wanted to confirm in telling 2 things So we have made a fantastic work to move to this working at home situation. We are still uncertainty. We are still in fact that are not totally, I would say, compute and understood. But what what we do believe that this company is solid, not only financially. It is going to be a resilience and take advantage of the situation when the situation will come down here with them. Answer date. Thank you to all. Keep safe and, we'll be in touch in the coming year. We're coming in the weeks with the. Financial intermediation, agenda, the next event, as you mentioned, the NDA, next week or meeting a financial communication event, we will take that from a seller there in our meeting. As we announced in 23rd March, we proceed with showed us to now making a new postponed to 26th June. Why it was initially stable in April 16? And regarding next communication and financials to the performance, H1 usage will be released in 29th July with a webcast standard day. Of course, Tejas wants to be continued to participate in the coming months with numerous now digital conferences organized by doctors and in parallel, concentrated to reach out directly for your interest in digital meetings with us, offer our questions, and we will be happy to address the request. Thank you all, and speak to you. Bye. Thank you. Bye. Bye bye. Ladies and gentlemen, this concludes the conference call. Thank you all for your participation. You may now disconnect.