Earnings Call: Q1 2020

Jan 21, 2020

Hello, and welcome to the Easyjet Q1 20 Analyst Conference Call. My name is Courtney, and I'll be your coordinator. 4 days event. Please note that this conference is being recorded. And for the duration of the call, your lines will be on listen only. However, you will have the opportunity to ask questions. If you require assistance at any time, please press star 0 and she will be connected to an operator. I will now hand you over to your host, Johan Duncan, again today's conference. Thank you. Good morning, everyone, and thank you for dialing into our Q1 2020 trading update. Joining me on the call are Andrew Findlay, our CFO, as well as Michael and Holly from our IR team. You should have been sent to slides along with the statement, which is also available on our corporate website. And as usual, I will briefly talk through the Q1 results and then follow-up with plenty of time for any questions. You may have. So firstly, an overview of the quarter in which Easyjet has delivered a strong performance. Our revenue performance highlights advantages are network strategy has delivered. Having Europe's leading point to point network between the confidence primary airport is a strength that shouldn't be underestimated. Revenue proceeds performed ahead of expectations with our deal initiatives continued to be a major factor in the strong performance. We're also seeing a robust level of demand across Europe while competitor capacity growth in the market was around the same low levels we highlighted at our full year results in November. These factors together have resulted in an upgrade to our RPS guidance. Underlying cost performance in the quarter was in line with expectations as we continue to deliver on our cost program leading to no change in our cost guidance for the full year. It suggests holidays was launched successfully at the end of November with a strong momentum. And our operation performance has been strong mid quarter in spite of strikes, and a net traffic control environment, which remain challenging as demonstrated by our improved OTP and CSF scores. I'll run you through the key financials. We carried 22,200,000 passengers during the quarter, an increase of 2.8% from last year as easy adjusted value for money offering impacts good demand from our customers. The capacity capacity grew by 1% in the quarter, in line with our expectations. And when combined with strong demand and continued execution of revenue initiatives, it's led to our load factor improving by 1.6% points to 91.3%. Passenger revenue grew by 9.7% in the quarter to just over SEK 1,120,000,000, pounds and ancillary revenue grew by 10.8 percent to SEK301,000,000 in the quarter. Please note that the proceed numbers, which follow our own airline only basis, excluding ECGAAP holidays. Total revenue proceeds at constant currency including EBITDA's holidays grew by 8.8% which is a strong performance. Airline Post proceed a fuel at constant currency was in line with expectations and increased by 4.3% in the quarter, as we will discuss later in the presentation. I will now run through revenue in a bit more detail. I'm starting on the left hand side of the graph. The bankruptcy of Thomas Cooked provided a benefit in the quarter representing 79 fee proceeds at constant currency. Consider revenue increased by £1.08 per seat due mainly to further innovation and conversion uplift supported by the use of data. This success included continuing to refine our seasonal pricing on allocated seating as well as pricing algorithm on bags. Underlying training has been particularly strong, leading to an increase in revenue proceeds of £2.87 at constant currency. And this was driven by a material increase in Berlin, reflecting the work we have done to optimize our German network robust demand as well as low growth by competitors on each of that market. And finally, about 1 third is due to significant increase from our successful revenue initiatives to stop delivering results through the second half of twenty nineteen and have continued the momentum into the start of 2020. Our commercial team have delivered these initiatives across across a greater section of our network but have also begun to expand the timing of our late deal initiatives. In summer 2019, we concentrated on the period 7 days out from departure This is now expanded to 10 to 15 days from departure and further refinement and expansion across the network to come. Moving on to costs, focusing on costs continues to be a key strategic objective for Easyjet to ensure we maintain our competitive advantage on the network we operate. As expected, we delivered a cost increase of 4.3%, excluding fuel at constant currency in the quarter. This increase is mainly driven by lower capacity growth for the quarter, which will continue to be low in Q2, ongoing regulatory and inflationary pressure our airports and maintenance and ground handling charges, ownership costs, and prepaid agreements and higher retention levels. It is important to note that costs were delivered as expected despite the impact of strikes in France, which drove over 800 installations over a 3 day period in December. These increases have been partially offset by continued focus costs, including our ongoing operation resilience program and the up gauging of the fleet as this just continues to move from A319s to to A320s and A321s. Moving on to fuel and FX. This slide summarizes our forward jet fuel and currency hedge positions. Our hedging policies continue to represent the cushion against the risk of major volatility in fuel prices. As of 31st December 2019, we had hedged 71% of our full year 20 jet fuel exposure and 51% of our full year 'twenty one exposure. Turning to forward bookings. H1 remains slightly ahead of the same last year with around 75% of the seats booked for the half. 68 seats are booked for Q2. This is slightly ahead of where we were this time last year. Next slide shows the expected capacity growth across the European short haul network through the winter And as you can see, short haul capacity in Easyjet market is expected to grow by just 0.5% in the half with Easyjet reaching 1.5% growth. In terms of competitors on our routes, we are expecting a decrease in capacity of 0.2%. This is a decrease of 0.6 percentage points compared to the figure we highlighted at our full year 2019 results in November. Now moving on to our industry leading sustainability program, the strategy we launched in November was a groundbreaking one for an airline taking immediate action on carbon emissions. We hope that this will drive real change and that others will follow our lead. We continue to focus on driving efficiency, and we're working through reevaluation through our partnerships airbrush and right electric. Because as I said in the November, we see carbon offsetting as an interim measure. In terms of progress, since our announcement on the 19th November, we have offset the carbon emissions from fuel used for all our flights. We have offset that 800,000 tons of carbon so far with Mind Indian Easyjet customers having now taken the net 0 carbon flights. Customer reaction has been very positive and well received. We've seen a significant improvement in customer satisfaction as a result of this initiative with a 7 percentage point increase from customers who are aware, their flight was offsetted and with 11% more customers saying they will choose etajess the next time they fly as a result of the flying being offset. EasyA holidays. I'm very pleased to report that EasyA holidays was accepted loans on the 28th November with the first passengers traveling on the 6th January. At launch, we offered holiday to around 700 Hampton Hotels in over 100 destinations. And so smart customer feedback has been very positive Not only with the holidays on offers themselves, with 85% of customer insight in great value, but also with the user experience on the website, including the ease, with which a booking can be made. Our direct contracts with hotels that performed well accounting for around 50% of all our bookings in line with our expectations. We're seeing strong demand for flexible data and leveraging the EZF network with around 60% of the EZF audit customers so far choosing the ratios other than the traditional 7 or 14 nights. We also seen a strong demand for 4 and 5 star hotels, which I currently around 75% of all our bookings. The access to great value is to just flights and our highly efficient operation had resulted in our holidays a like for like basis being highly competitive in the market. And we are on track to deliver against our guidance of being at least breakeven in our 1st year of trading. Moving on to outlook. During the first half, we will grow capacity by around 1.5% as we continue to focus on driving profit perceived in cash, which is slightly lower than our previous expectations of 1.7% growth primarily due to the impact of French air traffic control strikes. As we explained at the full year results, we plan to grow full year 2020 passed it by around 3%, which is towards the lower end of our historic growth rate of between 3% 8%. In the first half, we expect revenue proceeds at in currency, excluding incident holidays, to show a mid to high single digit increase. This is an upgrade from our previous expectations or low to mid single digits. For the first half, we expect headline cost per seat for the airlines, excluding fuel and at constant currency, GAAP by mid single digits. This will include an expected 1 off maintenance charge. The full year headline costs proceed with airlines, excluding fuel net constant currency, is expected to be up low single digits, assuming normal levels of disruption, which is no change to our previous guidance. States and exchange rates highlighted, we expected £70,000,000 year on year positive impact from FX on a full year headline PBT basis. Around 25,000,000 of this is part of the fuel bill. Unit fuel, it's it's expected to have an adverse impact of between 110 £170,000,000. The total fuel bill is expected to be circa 1,000,000,000, including our 25,000,000 investment in carbon offsetting unchanged from previous items. As a result, we currently expect to deliver headline loss before tax for the first half of twenty twenty which is better than the loss experienced in the first half of twenty nineteen. DTS holidays is expected to be at least breakeven in 2020 which is no change to previous guidance. Regarding H2 expectation, it is still early in the year when considering the number seats booked we'll give you an update at our half year results in May when there's more certainty around the outlook. So thank you for listening, and we are now more than happy to take star 1 on your telephone. Our first question comes from the line of Jared Castle calling from UBS. Jared, please go ahead. Thank you, and good morning. 3 FMA. Firstly, just on Jeremy, if you could just give some color on, you know, how performance is there and also just the thinking about, you know, moving into Q2 with higher taxes and, you know, potentially more kind of, rail supply coming on stream, what would that means for the business? Secondly, just just on the cost, I mean, you know, looking further ahead. I mean, if you're in a low kind of capacity, both environment call it more towards the 3 than the 8th, you know, over the medium term, how how how would you think about the ability to kind of stabilize ex your unit cost or or or or or, you know, what kind of bandwidth are we seeing in terms of in terms of the increases? And then just lastly, on EasyJet, holidays. I'm thinking a little bit about booking process. Obviously, you know, tour operators tend to do a lot of selling at the moment. You know, given you, you know, the the call product is still obviously the airline, do you do you expect the way that holidays gets booked through Easyjet It's slightly different to kind of traditional car operators or or or very similar or, you know, is there some new answer? Thanks. Yeah. So, start with the with holidays and the booking profiles. So traditionally, the data holiday segments are booking earlier. Which is, you know, good for ourselves. So that's something that we like. The early bookings, also the focus around the holidays when comes to the financial outcome, it's clearly an initiative also to drive profit receipt. We said there are focuses about profit receipt, road key, and then also sustainable positive cash flows. And the part of it does just that. So it's actually a good compliment to what we're seeing is the normal demand curve from an airline point of view. On the on Germany and Berlin. We are really pleased with the performance in the quarter. It's one of the strongest performers on a year on year basis. We talked earlier about also double digit increase and then RPS environments in in in Germany, and this is very much an analogy you know, the optimization we've done of our network and we see that that will continue. In terms of going into Q2 and then, you know, factors beyond, you know, the partly beyond our control. I think that we still have, you know, quite a good, you know, opportunity to do more from an optimization point of view. We reckon that that the Berlin is just optimized around 75% of what we think we can do. So this is very much down into the control of ourselves and we see that we have more opportunities to improve this situation, better to also mitigate, you know, impact that might fit outside our, or, you know, our our controls. I'm not very concerned about them. Very pleased with the with that performance. On costs, Andrew, if you wanna Yeah. So I think, you know, we got a a a number of opportunities. Just just gonna take you through what happened in the quarter. So, basically, as as you expect, with lower capacity growth, which is more pressure on the denominator from from a cost per seat perspective. And that was also impacted by, French National Strikes. We had, an impact on the cost basis, but also to cut capacity in the quarter. We had some increased inflationary increases associated with ground handling particularly. Now for that, to be clear, that's as a result of us. Transitioning is slightly different model, in a number of our airports to an open book model, which is which will give us opportunities the future, which is something we did exactly a few years ago, which is working well, and we've come with a couple of other of our UK bases. With the scope of maintenance costs, you know, with the, you know, vigorous reduction in in capacity growth in the in the half, to, to, you know, to take out that strategy and focus on on a contribution. We took the opportunity to do quite a bit more maintenance activity in the quarter. And we'll see that in Q2 as well. I think the comment about the one off activity that we're doing there. We also saw some impact as a result of the, the lower, crew, attrition rates, which we've seen over the last couple of quarters, but we expect to equalize out in the second half of this fiscal year. So from a point of view of this quarter into the into the into the full year, we haven't changed our full year guidance. And and, as as we've said, it will be slightly higher cost per seat in the first half than we expect in 2nd. Longer term, we we are absolutely focused on continuing focused on operational resilience. That's something where we're all focused, on as a as a team, but and we see our opportunity there. We see opportunity in accrued productivity around how we work with our crew to improve that and how we base our crews. It's something we're working on. Another area of of of focus, as I said, is ground handling and leveraging the open book deals that we've, we've signed up in 2019, which is a a good model that works well. And, obviously, we've got the underpin of the up gauging. We've only got 83 2021s in the fleet as we stand, and we've still got, but we've got, the order book out to reach 30 over the coming years. We are over the coming years, we're taking out quite a few 83 19s and converting those into higher gauge aircraft. So there's an opportunity there So it's quite a bit to go after, and we're comfortable with our guidance that we've given to the full year on costs. Thanks very much. The next question comes in from the line of Savi Syth calling from Raymond James. Please go ahead. Hey. Good morning. Just three quick questions for me. On the UK side, just wondering if you can provide a little bit of color on on demand. Last year, I think you saw a lot of kind of maybe uncertainty related, kinda demand weakness. Is is that gonna now fully recovered or just not getting worse or, you know, what you're seeing in the UK? Second, just given the strength, in in the environment, I know you're not increasing your capacity outlook today, but just wondering what your willingness is to maybe push the path a little bit more. And then finally, to the minor question, you know, Flybe doesn't really kind of join a lot of markets that you're in, but any opportunity there, to take on any kind of, signature you gave to flying or anything that's great because. Thanks. Yeah, thank you. So on the UK, just I think it's just worthwhile pointing out that we see that, you know, it's a good demand environment really across the whole of the the network. But it's, you know, it's correct to say that we're seeing no impact on bookings, you know, related in, for instance, to the 31st. So January Brexit date. We have, we have a, you know, kind of a Brexit tracker from a booking point of view. And as of the 31st March last year where they had one of the deadlines, we could see the bookings were impacted at that point in time. That didn't happen in the in October and that is certainly not happening in here in on 31st January. So I think it's, you know, from from the uncertainty around Brexit, I think the data's going to weigh. People have kind of got used to that and and and moving on and planning on, you know, going on with the lives as certainly has increased as we move forward into that process. So So we're robust and a good demand really across everything in the UK. In terms of the capacity and the growth and unities. I think it's fair to point out first that, you know, the company has grown quite a lot in the last couple of years. You know, we've taken also strategic, great positions in the last couple of years. We've grown 20 percent of the capacity, without the Berlin transaction. That's an example. And the focus is really on, you know, moving into more of these number 1 and number 2 positions at the primary network. And that's something that is still at the core of what we're doing. So I think even if we are at a kind of lower size of the growth path to capacity, now it is this year being in, but not the 3%. You know, we will still focus on getting on to these these positions. We're operating and flying to around 106 airport. So we have this leadership positions and just a little bit more than 50 of those. So we still got more to do on that. So we will not be constrained by making, you know, actions and taking these positions across the network. But overall, you know, 3 to 8 is is where the company has been, you know, previously, and that's where we continue to be. And now we see that growth that we've had in the past, we wanted to mature. We wanna optimize the results on that. And we would be, of course, also looking out for opportunity where we can strengthen our position, as I mentioned, on this network. On Flybee, I mean, it's, we are, you know, So we do it in any market. We are looking into opportunities that exist, and we're also looking into opportunities that exist because of changed it in the competitive environment, and this is no different from that. But, we will see and continue to watch what what that will mean also in the UK. Alright. Thank you. Thank you. The next question comes in from the line of Andrew Lobbenberg calling from HSBC. Please go ahead. Morning, guys. Could you talk a little bit more? I mean, I know you, Andrew, it's looking already a bit, but but about how aggressively we think costs can, improve into the 2nd half. Can they go negative and, what can drive and how much confidence can we have in in that strong cost inflection. Can I ask about your views on on the this guy's government review of air passenger duty? And then can you just tell us what's going on with visibility, when does he come abroad? What will his role be relative to the rest of the group? Yeah. So I I I can pick it up from the bottom there. Peter actually joined us yesterday. So he's in the company as of now, and he really seems to have him on board, and he will be a great contribution to continue to deliver on our plan with all the priorities and the focuses that we have. So it's great to have him on board. And, like I said, really looking forward to working with him. Update the revision. I mean, we are, you know, liaising direct with the governments on this, we believe that this is an opportunity, given that this has now come up on the top of agenda, for a number of reasons. In terms of the situation with Flywheel, but then it should be revised. We believe it should be reduced overall. It's one of the highest passenger taxes in the world. And, none of the revenues as far as we can see goes into anything, what we believe it should do, which is to read a decarbonized aviation, to continue to have the industry for the have the ability for the industry to continue to grow and therefore making sure that connectivity in the UK is, it's maintained and increased. So that's what we wanna do. We also wanna see that the design clearly of the the exchange. We think it should be bladed into the efficiency of the of the airlines and then also possibly into the carbon emissions that exist and taking into account also that we as the 1st major airline in the world have decided to offset the carbon from more flights. We believe that that is something that also should be taken into consideration. But that's something that we are, myself, or personally engaging directly with the government on. Andrew? Yes. So I'll say hi, Andrew. So number 1, know, obviously, we've got increased capacity growth in the second half of the financial year. So, effectively, this denominator increases, especially with the CPS perspective. That's it. We're absolutely focused on the absolute numbers. So our operational resilience continues to be a huge focus by the organization. And we're confident of the measures we've put in place around, the way we manage disruption in the business And we've seen that actually seen that come through in the first quarter of this, this financial year as well as the underlying performance taking away the, the Fed strikes and we've seen improvements in our 3 hour delays in the first quarter. And we hope to see that come through into the second half as well. Other areas we're focused on obviously, the the maintenance cost of the activity that we've done with, we've we've done in the, the first half, we we won't be replicating a lot of activity in the second half. But we have taken the opportunity to serve to do quite a bit of maintenance. It's increased year on year. But, from that perspective, we're we're comfortable with our in our full year guidance. And as I said, with, with it, you know, we'll continue to focus on cost over the medium term as I as I asked to to Jarrod. I think, it's it's it's clear from our perspective, you know, with data and the the effective data in our underlying operation and the and the and the success that has had on operational resilience. There's other opportunities where we can apply that capability set and that's what we're thinking about now. Can I just ask on on COGS? You speak about maintenance a lot. And I think you mentioned maintenance one offs is that It's gonna be more maintenance in Q2 and Q1. And just taking the maintenance 1 off, just going into the headline cost number. Is that right? That's right. So, effectively, there's a there's a catch up. We we may need to do a catch up in the second half. So if it's a gift card for a catch up that we need to do over the coming years in our aircraft that we are, that we're expecting to do in the second half in the second quarter. So we can do a I suppose we can give you a heads up on will go into main into headline costs, yes. The next question comes in from the line of Neil Glynn calling from Credit Suisse. Please go ahead. Hi. Good morning, everybody. If I could ask 2 quick ones, please. The first one just following on from the the the topic of maintenance Just interested, could you confirm if you have any aircraft disposal plans through the rest of the year? Is some of that maintenance in any way related to disposal plans or or completely unrelated. Second question, the load factor was quite nicely in the first quarter, and it's the first meaningful increase in a couple of years. Just wondering, is this a function of disruption, or how should we think about that as you, balance volume and pricing given that the preference has been more for for pricing than load factor over the past couple of years. And then the third question, ground handling progress. Andrew, you mentioned Gatwick, where, obviously, you, contracted with a new supplier on the ground handling side. Has been followed by a couple of other UK cases. To what extent should we expect there to be rollover with, perhaps, new, third party providers across the rest of the network over the next few years or have those plans, from both at all. Yeah. I mean, on on the last thing. Yeah. That's definitely the model, I mean, we would like to see rolling out, you know, into other places. It's it's something that actually for all the for all the parties who work for the 3rd party works for ourselves as well. He gives clarity, he gives incentives, and he gives penalties on the on the performance. And, you know, the operational, also performance is, is, we believe, better We've got, type of, of, incentivizing and penalizing, you know, the, the, the procedures and the outcome of that. So that's definitely something we would like to see as we are discussing also currently across the other companies in the network. On the on the load factor, yes, I I think it's fair to say that there is, you know, the self help initiatives that we've been doing. In, in the last year that is also working on, you know, when we're seeing that we introduced in, in the summer where this clearly, you know, take the And even when we then go into lower demand periods, such as January as an example, we knew that we can then look at the, the benefit for them selling in earlier than we probably did before. So you see January as an example, we have 3% on on the load factor there. So it goes both ways, and I think it just become better because of the data initiatives we've been doing when we're comparing to, you know, similar routes. So that is points of effort that we learned from that and can be more aggressive earlier on when we see that the demand is lower. So we are we feel very excited about what is in the is the limit for us. And even if it's now been these initiatives has been expanded across the, you know, great to share the network, It's still not, you know, implemented everywhere clearly. So we still need a lot more to go with these initiatives, and we also got planned initiatives to come one of the great things with these these data driven initiatives is that they take about from an idea of analyzing the opportunity. It takes us about 8 to 12 weeks to get it in place and getting the melt across the network. So it's a very, very quick way of seeing and and getting upside. So we're very excited about that. Neil, on the on the main since the main driver is the level of c checks that we've been doing. So, obviously, as you know, the the the the the heavier of the the the the check that we do on some of our older aircraft. And to be clear, there there is a the, the underlying inflation pressure remains to be some. But, as as a result of the activity around the C checks, there's just a level of returns that we've got this this financial year. It's actually relatively low. We've got quite a few deliveries this year, but the FDA takes all the time to relatively low. We've, as you as we said in the statement, we've just completed another 10, 70 specs, for this, this financial year, and we we are undertaking, as we do every year, another review of our of our fleet plan over the medium to another term as well. The next question comes in from the line of Rashika Sabiani calling from Barclays. Please go ahead. Hi. Good morning. 3 questions for me also. The first one, I know it's still potentially a little bit too early and was not all airline to finalize the plans for some but could you give us an early indication of of how you think the summer environment will look given the very low rate of, capacity growth that we've seen in the winter? And then my second question relates to that. Can you just touch upon what you decided to do with the Thomas Cook Slots in terms of utilization kits and so on? I said, very finally, just on your, H1 RTS guidance. I've just given what you've delivered in q 1 and the easy comparable in q 2. You could submit, I guess, in the mid to high single digit guide, it seems a little bit conservative. So is anything specific that we need to keep bearing in mind in terms of q 1 versus q 2? Phasing to make a realistic one? Thank you. No, I think it's, it it is, you know, the we think the appropriate guidance to give at this moment in time, you know, we've had a good start for the year, no doubt for that. We see that, you know, the the strong momentum that they had at the end of the financial year that continues to improve with, clearly into the quarter. And we look forward to that continue. So it's a combination really about a better demand environment, a better capacity environment and then also the self help initiatives that we're that we're doing ourselves. So, looking forward into the summer, it is, as you say, it's, early on, it's early on to give any more, you know, guidance on that. What we're looking forward, clearly, hopefully, that this momentum that we're into that. I will continue into the quarter and then we'll update to talk more about the performance later on. We are slightly ahead of the bookings for the summer. Versus last year, but, you know, we'll we'll update you a little bit more on that when we get into May. Yes, amazing. Yes, the tumor cooks off as well, there were some results that we had in that sorry, Ecwid as well and then also in Bristol. So we're looking to fly them. We're looking to optimize them and we have them included into the net that we are on sale right now. Okay. The next question comes in from the line of Multi Shores calling from Commerzbank. Please go ahead. Hi. Good morning. Also, some clarification, from, like, Yeah. Also some certification from my question first of all. Maybe can you give us a little indication on Alright. Just a reminder of how many years you're fleating and then how you're profiting from the 7 to 7 next day so that your competitors are not fleating in new more efficient planes. And, that's the return of the or the timing of the return of the 767 MAX. Get any role into your scheduling or interior across planning. And, the second of all, maybe if you talk a little bit about current bookings and mark this typically different between anything. I mean, you don't know if the bill was complicated, the rest of the market, but is there anything we keep in mind in market, which is a little bit concerned over the next month? Yes. So on the math, I think it's not like we are doing changed it to our schedule and to our network, speculating where the max will come in, in order to do that. So I think that that's all included in what we're seeing overall from the general capacity point here. I know it does affect some place that is out there. We don't do anything that is, you know, specific in relation to that because we don't know when they're gonna get back in. So I think, that that what other questions was. Oh, the Kirkwood is Berlin. Yeah. I mean, it's basically, if you're looking across, you know, what what does well for us, Berlin is actually one of the strongest performers on a year on year basis. And reading across the network, we're seeing also good demand for beach destinations where we are. We're seeing also a good demand also from, from from Amsterdam, so UK. So it's a strong and robust demand really across the the, the whole network. Just and, Monty, just on your on your point on neos. So we've got coming 34 neos, in the in the in a320 neos and 8 a321 neos every aircraft that will get from now on to be neos. And, obviously, we'll be migrating more towards neos as we retire off the A319s. Okay. Thanks. The final question comes in from the line of Manira Kahali calling from Bank of America. Please go ahead. Hi. A few questions for me, please. On the unit cost, is it possible for you to quantify the impact of the French strides and the ground handling. We also wanted to revisit the earlier question on a higher tax is in Germany and how you think that would impact pricing or demand out of Germany. Also did the French strike have any impact on unit revenues during the quarter. And then lastly, if I can follow-up again on a previous question, what routes would you be flying on the Thomas Cooks? Yes. Dorothy Costs, on the film strikes, we haven't given a specific figure, but it was single digit millions impacts on costs. So as you'd expect, that's, that's not great, but it's gonna that we've, we've installed within our, in our September in the Q1. With respect to, it does have a, an impact on unit revenues. So we haven't given that is relatively relatively small, but we haven't disclosed it in the in the in the bridge. But for, but for, again, 800 cancellations with the impact on that. I think with respect to, the Thomas Cook slot, it's fair to say that we, you know, we, as you'd expect, we, circulate those slots within our our our schedule, and we try to optimize the schedule. So we can't tell you exactly what those specific slots were used for as your we'll, be stuck with them within our main schedule. But you'll explain that we first start to fly again to Sharma Shafe from Gatwick and, that will that will help towards the utilization of those slots that we took over from Thomas Cook. The majority of those slots where are you being used to to fly to the, the destination, the leisure destinations that we, we've applied to it on, already, but we've obviously recycled those to optimize them out of Gatwick base. I think just on taxes in general, we are engaging us fairly quite a lot of time with, you know, governments across Europe as well on these discussions on taxes. We believe that taxes and due to some fairs. First of all, they should be reduced. We see that no other revenue of these things to the extent that it should be studio into activities is really decarbonized aviation. So we have today, I see 2 little transactions what the revenues of the so called eco taxes, taxes or duties are actually there to do. So that's one thing. And the other thing that we are also, are speaking to and requesting is clearly that taxes should be defined and that would be the same thing in Germany. Should be, designed around the output of of the efficiency of the various airlines. You know, if you're taking our carbon offsetting that we have done, which we know is a credible methodology of compensated for the for the coverage that you emit, we believe that there are any taxes and, and, that comes on to the ticket price should be linked into that performance. And I think it's fair to say that there's an understanding for that argument across the Europe and also in the UK. And now it's just more down to how these taxes are being designed. So we believe that we are made the right decision to carbon offset to what we do and we are always strongly, but this should also take it into consideration when when governments are looking at taxation. And then also that any taxes that that are out there, that we need to make sure that the revenue side of this one ends up and going into activities to decarbonize the bills. Aviation. So we can continue to grow and we can continue to grow in a way that has less impact on the environment going forward. Okay. We have no further questions coming through. So I shall now hand it back over to you yourself, Johan, for any closing remarks. No. Like I said, to summarize, we're having a very good start of the year. I'm really looking forward to this environment to continue a lot of opportunities and a lot of self help conditions is on its way. So thank you very much for joining. Thank you for joining today's call. You may now disconnect your handsets. Host please be connected to complete further instruction.