Earnings Call: Q1 2020

Apr 30, 2020

Thank you, operator. Welcome to the Wacker Kimi AG conference call on our Q1 2020 results. Doctor. Rudolf Staudigl, our CEO and Doctor. Tobias Older, our CFO, who will take you through our prepared slides in a minute. The presentation is available on our webpage under the caption Investor Relations. Before we begin, allow me to point you to a safe harbor statement, which you'll find at the beginning of the slide deck. Doctor. Staudigl? Ladies and gentlemen, Welcome to our conference call and the first quarter 2020 results. We delivered a strong performance in Q1. Sales were at 1,000,000,000, 3 percent less than last year, but 4% over the previous quarter, driven by volume. EBITDA came in at EUR174 million, a solid 23% higher than last year. These are good performance in chemicals, mainly due to a better cost base. Volumes in chemicals were up despite a pandemic induced slump in China earlier in the first quarter. Polysilicon benefited from its ongoing focus on cost reduction. While our first quarter performance was quite good, we started to see a deterioration in business conditions almost across the board in late March early April. The lower order intake is a function of the global response to the pandemic. As sales are slowing in some areas we are ready to adjust production levels accordingly. We are preparing for a harsher environment. We exercise strict cost controls. We focus cash generation and working capital management, and we push out CapEx and technical expenses were possible. But we will not compromise future growth. The work on our more significant restructuring program targeting annual savings of about EUR 250,000,000 by 2022 continues. At the same time, we take precautions now work from home, and we have intense medical surveillance on our teams in the plants. Infectional rates at our plants are at very low levels. Our top priority is the health of our employees, while maintaining production to supply our customers reliably. And a range of scenarios are possible. Early re openings and the fast refilling of supply chains could see the economy showing signs of recovery as we progress through the year. Longest instills would undoubtedly have more adverse effects We expect the global economy to contract sharply in the second quarter, and this will affect our customers and us. Given the volatile situation, it is currently not possible to issue a precise forecast for the full We believe that initial steps undertaken to lift the lockdowns will lead to positive economic effects. However, it is hard to either quantify or time these effects. When we last spoke in March, we identified a risk potential of over 1,000,000 to our forecast. We see this risk materializing but cannot reliably predict to what degree Tobias? Welcome. I will now take you through the presentation and provide you with the current trading update for each segment. Starting with Page 4, We had a good start to the year with results in line with our expectations. Sales were down 3%, primarily due to lower prices for solar grade polysilicon and standard silicones. We benefited from efficiency gains, cost management and a lower depreciation charge following the impairment in polysilicon last year. Gross profit improved by 48 percent to 1000000. We are actively taking steps to reduce expenditure across Our efforts show in the gross profit development and are also clearly visible in the SG and A line which was down 8 came in at for the quarter. On reflects our strong financial position. Having secured new loans of 1,000,000, we ended the quarter with approximately 1,000,000 in cash and cash equivalents, combined with additionally available credit lines of 1,000,000 we are solidly financed. Shareholder equity improved to 1,000,000,000 following the net profit in the first quarter and lower pension provisions. Pensions declined by 1,000,000 as the applicable discount rate As we move on to the segment, please note that we are only providing a trading update today. As Rudy already explained, it is not currently possible to give an accurate forecast for 2020. While we had a good performance in Q1, the next lower raw materials and our aggressive cost cutting will help offset some of these headwinds, but will not fully compensate for lower prices and volumes saw sales decline by only 2%. Growth in our specialties business helped offset weaker prices and standards, somewhat higher sales in the Americas helped compensate declines in China which was down nearly 20%. Silicones add value in many diversified markets and as such, they are not immune to a slowdown in GDP. While some end markets are clearly under pressure, Others like industrial applications and release coatings are seeing strong demand. The Q1 EBITDA margin at silicones came in at 20.1%, reflecting a good sales mix and cost performance. Our new silicone metal furnace in Norway is performing very well, and we saw a significant drop in our production cost. Looking at the current trading in silicones, we continue to see good cost performance in siloxane. However, we also see a lower order intake we may need to adjust Polymers saw a strong performance driven by volumes and efficiency gains. SAID increased by 3% with growth in Europe, offsetting weaker demand in China. We had high utilization rates at all plants and our new powder dryer in South Korea helped drive volume growth even higher this year. EBITDA margin climbed to 18.6 percent with firm prices, efficiency gains and cost discipline. Looking at the current trading in polymers, we see China demand recovering and other regions reporting weaker sales. We will adjust production levels accordingly should market conditions not improved. Stricked cost management and lower raw material costs should support the result. By solutions on Page 8, saw strong demand in all businesses. Sales increased by 9% with cyclobextrin, cysteines and biopharma performing particularly well. We saw high utilization rates in all our businesses which supported higher earnings. Looking at the current trading advice solutions, we see high demand in cyclodextrin and have a strong order book in biopharma. At polysilicon on page 9, we saw a good cost performance but experienced weaker volumes overall. Sales declined by 13% with somewhat weaker demand and lower prices for solar grade polysilicon year over year. The vast majority of wafer cell and modular manufacturing takes place in China and the effects of the coronavirus already showed in the first quarter. Reported EBITDA improved significantly compared to last year as we made good progress on our cost roadmap and increase semi grade volumes. Inventory valuation effects were lower than previous year. Looking at the current trading in polysilicon, we see customers in China resuming production, but now believe end markets will not be as strong as we previously forecasted. To be in the range of 105 to 125 gigawatts this year compared to our previous forecast of 135 to 155 gigawatts. Now looking to cash flow and net financial debt on page 10. Gross cash flow in the quarter improved substantially to 1,000,000. By the first quarter saw the typical seasonality driven investments in working capital, the absolute figure is 4% lower than last year. Our efforts to CapEx in Q1 was down 55 percent to 1,000,000. As we completed our major projects, and tightly controlled spending on new projects. With net cash flow from operations of 1000000, Our net financial debt position improved to 1,000,000. We are taking a hard look at cash flow and have have installed firm controls on expenses and working capital. With a strong cash generation and a good liquidity position we feel well prepared, good market conditions remain challenging. Let me hand you back to Rudi. Thank you, Tobias. Looking at current trading, we see a mixed picture as Tobias just said We have some markets going at a good or even strong level. These include semiconductor polysilicon, silicones for industrial applications and release coating as well as our biopharma business. Much slow. On the other hand, our PV installations leading to lower demand for solar grade polysilicon. Also, Automotive and consumer demand suffers from the effects of the pandemic response. Slide 11 shows a few of our products with currently high demand. In biosolutions and the medical grades in silicones, we are operating at capacity levels. In line with most economists, we expect a pandemic driven global recession to hit our markets in Q2 and Q3. The slowdown will afflict our customers and us. The pandemic risk we highlighted in our last call is unfortunately materializing, and we are responding rapidly to the developing situation. We currently focus on maintaining the highest level of production possible while taking the necessary precautions for a more pronounced downturn. Starting tomorrow, we will reduce production at our German polysilicon sites. We aim to avoid layoffs ensuring that our highly trained staff is available to return to work once demand improves. We are also looking for options to introduce short term work in other operations and administrative functions as the situation unfolds. Work on our shape to future efficiency program is progressing well. We will reduce CapEx to below EUR 300,000,000 this year by shifting smaller projects and delaying non essential technically upgrades. All these measures will help secure our strong financial position The pandemic makes for a tough time and forecasting is impossible. Please bear with us through these exceptional times. Seeing how our team is pulling together and how efficiently we manage to run our plants gives me confidence. With our diversified operation silicones, we will be ready when markets pick up again as supply chains get restocked and markets regain traction. In polymers, Volatility in oil based competitive materials may create some disturbance, yet the performance of our products continues to drive volume In BioSolutions, we expect growing earnings contributions from our biopharma business as the year progresses. Polysilicon suffers from temporarily weak demand But the rapidly shifting markets towards high efficiency products improves our midterm outlook substantially. Integrated production, continuous innovation, strong customer focus and cost performance have always been part of our DNA. We take up the challenge and continue to work on improving our operations and processes. While there is a lot of uncertainty out there, we are facing difficult times, I can see a future where we emerged stronger from the crisis than before. Thank you. Thank you very much. You. If you find your question is answered before it's your turn to speak, you can dial 0 and 2 to answer your questions. If you're using speaker equipment today, Please leave the handset before making your selection. First question. It is from Andreas Heine of MainFirst. Please go ahead. Your line is now open. Yes, thank you for the opportunity to ask questions. First, on polymers, could you highlight how the April was and what do you expect hear from the second quarter, let's say how the equation works out in potentially lower volume, but on the other hand, a materially lower raw material costs. And the second in polysilicon, so sales in the first quarter were not that much weaker. And now you have these short time working. So I guess that you expect the Q2 to be, even worse than Q1 and that you potentially have built up some inventories, which you try to avoid in the second water bank, curtailing your production. Could you give some insight how the delivery, momentum was throughout Q1 and what you see from today's point in Q2? Andreas, Tobias, Tobias, yes. I start with the first question on polymers. We have seen significant deterioration in business conditions, I think, almost across the board in late March early April. And this also affect polymers, our mostly construction driven business, you had seen that sales in the first quarter was up, compared to prior year. We had a very strong European business, but yeah, some headwind in China already in the first quarter. But in April, this changed. So the expectation is that revenue should be around 15% below prior year. And as, orders have also declined the shutdown situation in Europe and the Americas, you could see that number for May June, May the 15% should be a higher number, but it's hard to assess right now. On the raw materials side, for sure lower ethylene prices that are sort of linked to overall energy and oil in Europe, NAFTA driven in Asia and U. S. More gas driven, ethylene prices come down. I think with a time lag, also wider aesthetic monomer prices should come down from both the cost base being lower and also demand being lower for them. Grace, on polysilicon. The impacts on the polysilicon demand are different in the first quarter and the second quarter. In the first quarter, It mainly was determined by a slowing production in China and especially, slowing transportation capabilities. Worldwide, shipping modules, to all locations in the world. And the reason obviously was the, corona epidemic in China. And all the impacts of the slowdown of the shutdown in China. In the second quarter, we see production capabilities coming back in China. On the other hand, the demand, the global demand is pretty much down all over the road because of reduction of installations because of the epidemic or the effect of the epidemic. And so we had reasonable sales, I would say, in the first quarter, but we see this overall global slowdown starting in the second quarter. And the question really is, how long will it persist? I mean, so far, we are saying the global installations will definitely not, surpass last year's installations but we really need to see on a short term how things develop. We started with a 30% reduction in utilization of labor. And we will adjust as needed. And this 30% decline in labor is fit to the cut in utilization rate in production, I guess? And production support maintenance staff, for example. The next question is from Thomas Rudglesworth of Citi. Please go ahead. Your line is now open. Good afternoon and thank you for the opportunity to ask questions. First question is on, you kind of know the recovery in polymers in China, but didn't make the same comments for silicones. Have we seen the worst of it in silicones in China now, and what do exit rates look like for silicones? And if you could give us any sense of, the kind of exit rates for March, into April in U. S. And Europe for silicones, that'd be super helpful. And then I had a kind of second question, which is on to touch on power tariffs. Notably in Germany, given that we are in a lower energy price environment for both gas and oil, is that something that you're able to lock in for longer now, and or would consider doing so? Kind of elaborate on that and then how you see power costs going forward from 2020 to 2021? Thomas, on the Silicon's question and, the development in China, you noticed that, rightly that there is a difference. So, why construction activities have seen a faster pickup in China. Again, we see an overall silicones customer segments, still a slower progression of the recovery. And I think the expectation was that after the lockdown in Q2 would be back to normal in China and from an end customer demand perspective that apparently is not the case and that affects silicones. I mentioned that the April revenue for polymers is some 15% below prior year. The same would be true for fleet counts, so also about 15%. And with the lower order intake, we also see a decline going forward into May and June. I remember your question on Europe and the U. S, they're moving pretty similar. We had still a strong 1, in both regions, both Europe and NCA, NCA even a bit stronger. But we now see a similar pattern in both regions. I think the second block of your questions was on power tariffs and you asked about how we can benefit from the decline in electricity prices and gas prices. In the short term, from our overall rolling hedges that we do, I mean there's limited impact for the year 2020. But yes, we see lower prices against prior year. It is a benefit that we can can capture. But your second part of that question was how can we take advantage of that for longer term, yes, we do, we do this. We have a scheme of rolling hatches that we typically follow And given the now very low prices, we have extended buying forward contracts on both electricity and gas. Okay. Any would you say so, what part of your power is kind of further how much are you hedged out kind of beyond maybe 1 year? Could you give any indication of the quantity that's would be more than 1 year hedged? No, I don't want to talk about those. Okay. That's fine. Sure. Okay. Thank you very much. Thanks. Very helpful. Thank you. Welcome. Thank you. The next question is from chetan Udeshi of JPMorgan. Please go ahead. Had a question just on the pricing environment. You know, we've seen in silicos, for instance, the commodity pricing in China has taken another leg down over the past few weeks. How do you see in this weak environment the pricing for specialty products holding, both to some extent in silicones, but also in polymers given the raw material prices also weaker at the same time. And can you probably help us understand how to think about the operating leverage in terms of the impact from say, weaker, 15% to 20% weaker sales on margin or on just the absolute earnings? So in other words, what would be the flow through of say 1 year lower revenue to earnings? Any rule of thumb there would be useful. I would take the first question. I think the second acoustically, we had some challenges Your question was on the price, development in silicone split between commodity business and specialty business, for sure, the most pressure is on the commodity side. We had seen year over year some headwind, which also shows up in our revenue being below prior year, but I would say at least 80% of the price decline is just on commodities. Specialties are holding firm. But yes, there are also here and there, price movement, but mean more than 80% is commodity. And I think the second question would be helpful if you could maybe Yes. I was just trying to understand how to think about the operational leverage from lower sales on EBITDA or EBIT whichever way you think it's easier. I'm just trying to say if the sales are down 15%, 20%, how to think about how to think about the impact of that on margin or on EBITDA. So do you guys have some sort of a rule of thumb that every euro decline in revenue could be like $0.50 impact on earnings or something, which helps us maybe model the the negative leverage, properly? Chetan, very straight answer. Yes, we do have we do have these rule of sums, but we don't want to share these, unfortunately, for modeling purposes. So, hope for your understanding. Is the next question is from Patrick Rafais of UBS. Please go ahead. Your line is now open. Thank you and good afternoon everyone. And three questions, please. The first one is a follow-up on your comments around polysilicon and the production reduction in Germany. You later talked about a 30% reduction in labor Is that for Germany or is that for your global capacities? And if it's only for Germany, should we expect a similar plan for Charleston in the future? The second question would be, I realize you cannot give a guidance at this point, but back, in March, we talked about the 100,000,000 plus risk event as a framework number in the risk assessment Not a calculated number. Have you run these kinds of scenarios now and will this the your scenario analysis back up such a 100,000,000 plus risk event And then the 3rd question is just a quick one. The slide 11 where you showed these products that benefit from a pandemic demand. Can you quantify how much of your sales will be related to these activities? On the short time work, it's restricted to Germany. Charleston is is running on a semiconductor polysilicon, although not on full capacity. To the second question, as I said in the call last time, the EUR 1000000 for plus 1,000,000 is a risk category. It's not a calculated number and there's no spreadsheet for that. And as we said today, it's the pandemic risk of materializing, but we don't have a guidance on 2020 as it's impossible to forecast. The the depth of the recession in the 2nd quarter and then the pattern of the recovery. And the third question was on the, on the products that show, yeah, additional demand, from the situation, I think we don't have a specific number now that we can highlight here. Not a big number, certainly. But is there a very, yeah, future oriented, great products that certainly will be in higher and higher. Thank you for this. I just want to add that quite a few years ago, we put a lot of emphasis on medical applications of our silicon products and put in clean room facilities, etcetera, etcetera. And that's really paying off nicely right now. Okay. Thank you. Then we go to the next question. It is from Jung Friesch of Kepler Cheuvreux. Please go ahead. I have 2 follow ups on polysilicon. First of all, you mentioned that you adjusted production levels. Would you say that further cost cuts and the measures in division may keep the EBITDA for Q2 at 1st quarter levels despite lower fixed cost coverage to volumes, assuming stable pricing? And then the second question is, if you can provide more color, if you have shipped any polysilicon from Tennessee to China in the first quarter given that this should be now possible due to the U. S. China phase 1 trade deal? Thank you. So the first question, I don't think that we are in a position to answer that right now. I mean, we have an idea about it, of course. And we certainly continue to reduce our costs, but to give a forecast for the second quarter, would not be the right thing to do at this point in time. And on your second question. No, we do not ship policy. We can to China from Charleston. Has a very highly qualified Semiconductor product and this is what we are focusing on. Okay. Thank you. But you would be technically able to ship to China? No. The tariffs for America product produced material are still in place. Thank you. The next question is from Laura Lopez, Autoban. Please go ahead. Your line is now open. So a couple of questions from my side regarding the shape or future or your restructuring program When are we getting more details on this? So maybe also regarding restructuring costs and a little bit of the phasing of those 200,000,000. I remember at the beginning, you mentioned that we shouldn't expect a lot of impact in 2020, but first quarter show already positive signs. So is that included in those in that initial target? And then 2 maybe general questions, one on taxes. So you had a positive impact in the first quarter. Is that due to some tax loss carry force or something like that? And do you have any potential guidance for the year? And then on dividend, I think there was nothing mentioned in the press release or in the presentation today. So do you confirm this, the dividend payment still? Laura, let's start with the first two questions. First one on the shape of the future program. As we said, we are targeting $250,000,000, not $200,000,000, as the cost reduction on both the personnel and spend side, which we want to achieve by the end of 2022. And given the situation with the COVID-nineteen crisis, I think the urgency of achieving those savings has increased. And over the past couple of weeks since we last talked, I think we had made excellent progress despite many people just working remotely. We have, from a project approach started to, yeah, define the ID organization also supported by external benchmarking. We have then defined the cost target of the 250,000,000 and now the phase over the past couple of weeks was to really develop specific measures We will now enter into negotiations with the employee representatives And as long as we as soon as we have agreement there, the implementation phase will begin as as quickly as possible. I would say on the indirect spend side, which is not personnel related, we also made great progress over the past couple of weeks. And there we will see faster ramp and savings, then on the personnel related measures. So overall, it is unchanged that we do not pack meaningful savings in 2020 just to be conservative. I think the good, start into the year cost wise was also mainly driven by our strict budgeting from last year and a very good cost discipline in the organization already showing progress It is not so much related to the measures that we are actually talking in the shape of the future program, which is really a comprehensive program across the entire organization. So when will you get more details? So we are heading for the Capital Markets Day in June. And then we would like to talk more about the timeline on or when to build in what level of savings? The second question was on the positive tax that shows in the first quarter. This comes basically from two elements the first is that with the impairment that we have taken on the polysilicon assets in last year, we have a lower depreciation level in 2020 going forward, but the impairment was not, tax effective. And for that reason, our pretax profit is lower And in addition to that, there are some other, reversal effects from tax audits that also contribute to a positive tax in the first quarter. And if you look at the full year 2020, you could expect also, taxes to be positive, especially from the impairment consideration that I talked about. And on your question on the dividend, of course, the proposal that was published proposal by the executive committee for Ashland and the supervisory board to the general assembly, of course, it still holds. Otherwise, you have, you would have learned it from an ad hoc anyway. So yes, of course, it still holds. Thank you very much. Our financial position is really strong enough to yeah, to keep the proposal at this point in time. Thank you. The next question is from Thomas Kuboda of Societe Generale. Please go ahead. Your line is now open. Yes. Good afternoon, gentlemen. I hope you are all well. Sorry, if I repeat a question that was asked before, I missed part of the call because of phone problems. So I still wanted to ask you about your initial target in polysilicon, you wanted to adjust costs in a way. So you should have reached an exit rate of run breakeven at the end of this year. Now you have cut your PV installation expectations for the year. So my question is what what does the cut in your expectations for the market volumes, due to your target of break even exit rate for the polysilicon division. And I will have a follow-up question. I mean, the slowing demand certainly does not impact our ambition in cost cutting. And, yeah, that's what we can say on that. You have you have said on the last call that at the prevailing price level, you were a little bit ahead of your of your plans. Now we have seen that that prices are continued to be under pressure less than than in the recent past, but still, they were coming down. Can you make up for something like this? Or is it fair to assume that the combination of the market pressures is throwing is throwing you back in your ambitions? Well, of course, if price levels are going down, the ambitions arise. There's no question. But we will see by the end of the year, how everything turns out. I think the biggest uncertainty is in the market development at this point in time. Understood. It's very, very tough to predict. Understood. My second question is on cash and especially in regard to the restructuring measures, you haven't announced yet. I fully respect that. And it's not a question how much, but in the interest of balance sheet and liquidity preservation, my question is do you expect any significant cash outflows for the SG and A cost restructuring programs still this year or are those outflows, whatever they will be, expected from 2020 onwards only? Thomas, there will be most likely 2 components for the cash cash outflow on the restructuring. If we think about the portion that we can do with accelerated retirement, this will spread over the years, over 2021, 2022. So there will not be a massive impact from this type of approach to lower the headcount on the 20 financials and cash. If we think about the second part, more like a severance program, this will, yes, will be offered if we find agreement with the employees representatives. And yes, I would expect that to be in the second half of twenty twenty. But, it is by far not from the numbers that some calculate, please bear in mind that the 250 that we are talking about is roughly 50% non labor, 50% labor. And of the labor component, there's most likely a big portion also working with a retirement approach. So, you can do the numbers if you like, but, I don't have any guidance today to this. So Is there a headache? Because of the current situation and the stretch stretch liquidity eventually? A little. Perfect. So We will push for the program as strongly as possible. So as I said before, we are really happy with the progress that we made. The urgency will drive the change most likely, even even faster. And there doesn't I mean, did I get it right headache? No, there's no headache at all. Perfect. To end on the even more positive note, the oil price, I mean, it has crashed a lot of market participants do not expect the oil price to recover shortly anytime soon. What does this low oil price due to Wakashimi? Public is the tailwinds? I mean, we are not oil buyers. We are not oil based business, but for sure, some of the raw materials have seen also massive declines like ethylene dropped by in the most recent numbers, I've seen. So yes, we will see lower raw materials and lower energy. Will all segments participate or should we rather think in polymers only or how should we see this? It is primarily polymers because those raw materials are closer to oil, but it will also be silicone if you think about methanol, which is linked to coal and gas. Perfect. So thank you very much. Very clear. Thank you. The next question is from Sebastian Bray of Berenberg Bank. Competitors still adding capacity within China or do they plan to do so within the next 6 to 12 months? My second one is also on polysilicon. What is the next big regulatory event either in China or elsewhere that will set 1 and beyond. Is it just draft documents for the next 5 year plan in September, October? Or is there a specific announcement or event, we whose date we know about? And the third question is on the Polymer segment. Are there any customers who are likely to ask for ad hoc renegotiations of pricing or are you sitting pretty for the next three quarters and these only really reset properly to reflect lower raw materials at the start of next year? Thank you. As far as aware of to your second question, there are no specific regulatory events scheduled at this point. I I know that, especially in China, they are thinking about special yeah, incentives to install more modules. And these programs will certainly be published over the next few months. But there are the normal regulatory rules, basically, in every country to support installation of solar modules. And to be honest, I, acoustically, I did not hear your first question. Says in China that are currently constructing polysilicon capacity or planning to do so within the next 6 to 12 months. Or is that are done for the time being? Well, there is, especially one competitor that has announced construction of additional capacity. That's correct. I assume you're referring to Daco, but do you, at this stage, based upon what you hear the market, do you assume that that is going to go ahead or? Well, I think we have a clear picture about our competition in China. And as I said, there is especially one who is obviously eager to add additional capacity. Which is on the extent to which customers can, particularly if they're distressed as for ad hoc renegotiations in construction or are you able to capture the raw material tailwinds for most of 2020? Sebastian, I'll take this one. I mean, if you look at overall polymers, we always say that 25% of our business is index based from our own selling prices linked back to the raw material input. And those will definitely move with the decline in raw materials. But the 75% there, I mean, some regular contract or annual contract, some semiannual, some quality projects. On the construction side, we have a firm stance on pricing. So I expect the impact more on the volume side than anything else. Thank you. The next question is from Sean McLoughlin of HSBC. Please go ahead. Your line is now open. Thank you. Just a couple of follow ups around Charleston and polysilicon. In March, you said that this facility is now qualified for semi. It's ramping up. You're saying today that it's not operating at full capacity. And you're not shipping to China, it's producing semi grade. Do I understand that you're not shipping to the solar sector now from this facility? Yes. We are only shipping limited amount of material to out of Charleston. What I meant is, the full capacity of 20,000 tons for solar material is not utilized. On the other hand, It's this facility is qualified for semiconductor material and is producing a semiconductor material at at the highest quality. The customers and the customers are not in China. Thank you. So can is it fair to say that the capacity of, let's say, this high purity semi grade would be somewhere near to 10,020,000? I would say it's below 20,000. And certainly higher than Tim. Thank you. There are no further questions. Thank you, operator. Thank you all for joining us today and for your interest in Wacker Chemie. We look forward to further discussions with you as the quarter progresses. Thank you.