Trading Update

Jul 16, 2020

Earnings release

Hello, welcome to Hays Q4 Analyst Call. My name is Jose, and I will be your coordinator for today's event. Please note this conference is being recorded. For the duration of the call, your lines will be on listen only. However, you will have the opportunity to ask questions at the end of the call. This can be done by pressing star one on your telephone keypad to register your question. If you require assistance at any point, please press star zero and you will be connected to an operator. I will now hand you over to your host, David Phillips, Head of Investor Relations, to begin today's conference. Thank you. Thanks, José, good morning, everyone. Welcome to Hays quarterly update call for the three months ending 30th June 2020, the fourth quarter of FY 2020. I'm David Phillips, Head of Investor Relations. I'm here with Paul Venables, Group Finance Director. Before we begin, please be aware that this call is being recorded, with the recording accessible using the number and code provided in the release. Please be aware that our discussions may contain forward-looking statements that are based on current expectations or beliefs as well as assumptions on future events. There are risk factors which could cause actual results to differ materially from these expressed in or implied by such statements. Hays disclaims any intention or obligation to revise or update any forward-looking statements that have been made on this call, regardless of whether these statements are affected as a result of new information, future events, or otherwise. I will now hand you over to Paul. Thank you, David. Good morning, everybody, and thanks for joining us. Before I summarize the key elements of today's update and take questions, I want to reiterate Alistair's comments in the statement regarding the superb response of all of our colleagues to the crisis. The past few months have seen unprecedented peacetime disruption to economies, families, and individuals. Our priority throughout, and remains today, to protect our colleagues in all aspects of our business and to continue to deliver excellent service to all of our clients and candidates. We're proud of the efforts and resilience shown by our people in navigating the efforts of this pandemic. I will now review the business performance in the quarter, and as usual, all net fee growth % will be on a like-to-like basis versus prior. Key points. Net fees in the quarter declined by 34%, with all of our markets greatly impacted by the pandemic. Temp net fees were down 26% and perm down 44%. The magnitude of the overall decline in fees to date is comparable to the 2008-9 financial crisis, the speed of decline was much greater, occurring over a period of 6 weeks versus the 7 months in 2008-9. That said, after falling sharply in March and April, net fees were broadly sequentially stable in May and June. I highlight the following key features in the results. One, conditions in each region were extremely tough. That said, fees in ANZ, the U.S.A., and Asia performed slightly better than the group average, with the U.K. and parts of continental Europe hit harder. At the specialism level, IT, which represented 29% of group net fees in the quarter, was relatively resilient, with fees only down 17%. The group's periodic cost base was reduced by 21% from GBP 73 million pre-COVID to GBP 58 million as we exited the quarter. This was driven by variable and discretionary costs being significantly below normal levels, clearly exacerbated by the fact that all of our offices were in lockdown for large parts of the quarter. Also by group headcount down 9% in the quarter. Additionally, at the 30th of June, 18% of our group employees were either in job support schemes, short-time working arrangements, or had voluntarily reduced their pay, including senior management. Also, given current conditions, the executive directors have agreed that no FY '20 bonuses will be paid to them or members of the management board. Three, while we will continue to tightly manage our costs, we expect our periodic cost base to increase as we enter FY 2021. We will incur more normal levels of operating and employee costs as normal working practices begin to resume, the job support arrangements end, and as we reverse the voluntary pay reductions. Four, since lockdown started, our business continuity was seamless as colleagues transitioned to remote working in a matter of days. Today, excluding the U.K., 85% of our offices are currently open, and we are working under a hybrid model. Five, cash performance was excellent, and we entered the quarter with GBP 365 million net cash, excluding the GBP 120 million of short-term deferrals of tax payments. This performance and our equity raise of GBP 196 million in April puts Hays in a very strong financial position. I'll now comment on the performance in each division in more detail. Australia and New Zealand. Net fees in Australia and New Zealand declined by 28%. While market conditions were very difficult, the Australian lockdown restrictions were relatively less impactful on our business than elsewhere, especially on construction sites. Temp fees, which represented 80% of our ANZ business, showed relative resilience and declined 18%, helped by some significant short-term COVID-related business wins, and perm decreased by 52%. Public sector fees fell by 22% and private sector by 31%. Our Australian business also saw net fees down 28%. In New South Wales and Victoria, together, 52% of our Australian business fees fell by 35% and 31% respectively. Queensland decreased by 27%, while Western Australia fell 16% and ACT 12%. At the Australian specialism level, CMP, our largest business, declined by 34%, while Office Support and Accountancy & Finance both fell by 48%. IT was relatively resilient, down 13%, as was our larger client, Hays Talent Solutions business, down 4%. New Zealand, which is 4% of ANZ fees, had a more severe lockdown than Australia and fell 42%. Consult headcount in ANZ decreased 13% in the quarter and by 20% year-on-year. Germany. Fees in Germany decreased by 33%, heavily impacted by the pandemic and specifically by underutilization in our temp business. Business confidence remains low overall, particularly in the manufacturing and automotive sectors, although other sectors such as IT and Life Sciences are showing clear signs of stability. Our contracting business, which represents 70% of German fees and where we operate a freelance model, was relatively resilient and declined by 12%. Most assignments were able to continue under remote working. In contrast, Temp, where we employ workers as required under German law and has a greater exposure to automotive and manufacturing sectors, this was significantly weaker and fees declined by 72%. There were three main drivers of the fee decline. First, our average Temp volumes reduced by 22% as less new projects were started across the quarter as clients tightly controlled costs. Second, as many clients closed their workplaces due to the lockdown, there was historically low utilization of Temp workers, with many assignments impacted. This led to reduction in billable hours and thus reduced net fees of GBP 6.8 million, or 30% year-on-year, which was net of government support on the German Short-Time Working Scheme. Third, given the significantly reduced level of demand from our clients and the tough market outlook, we took the decision to release 420 temps and incur the GBP 4.3 million of severance costs, which further reduced net fees by 20% year-on-year. Finally, perm fees fell by 29%. Moving on to specialisms. IT, our largest specialism, which represented 47% of German net fees, decreased by 23%. Engineering, our second largest specialism at 20% of net fees, was much tougher and fell by 52%, impacted by the temp effects noted earlier. Life Sciences performed much better and declined by 12%. Our German public sector business, now 15% of fees, performed relatively well and decreased by 13%, while the private sector was down 36%. Consultant headcount decreased by 6% in the quarter and by 12% versus prior year. Finally, as we briefly mentioned at the interims, in Q3, we restructured our German business. Our new organizational structure provides greater regional focus on the SME sector or Mittelstand, alongside a dedicated division focused on our large corporate account clients. As part of this process, we rationalized the management structure in Germany, and we will include an exceptional charge for the related restructuring costs in our FY '20 results. U.K. and Ireland. U.K. and Ireland, which represented 21% of the group, endured extremely tough market conditions and net fees decreased by 42%. The private sector, which is 68% of the business, fell by 46%. The public sector was less impacted, down 30%. Our temp business, 70% of U.K. and Ireland fees declined by 30%, whilst perm was even more difficult, down 58%. All regions traded broadly in line with the overall business, although London, our largest U.K. region, slightly outperformed, down 37%, whilst the Northwest declined by 53%. Our HTS business was less impacted and declined by 28%. Our Irish business, which is 4% of U.K. and Ireland fees, decreased by 44%. Across our larger specialisms, IT performed well, down 9%. However, Accountancy & Finance and Office Support both fell by 53%, while CMP declined by 51%. Life Sciences, boosted by some COVID-related contracts, grew an excellent 25%. Consult headcount decreased by 7% in the quarter and by 6% year-on-year. Rest of the world. In our largest division of rest of the world, which consists of 28 countries, net fees declined by 31%. Perm, which comprises 61% of divisional fees, fell 39%, whilst temp decreased by 13%. Europe ex Germany decreased by 32%. Our largest rest of the world country, France, declined 44%, as did Belgium, while Spain declined 47%. Switzerland performed very well with fees up 6%, while Poland also fared better, down 14%. In the Americas, net fees decreased by 30%. Our U.S.A., the largest rest of the world country, fell 18%, with relative strength in IT partially offsetting very difficult conditions in Construction & Property. Canada was tougher, down 45%, as was Latin America, down 51%. In Asia, fees decreased by 28%. Our two largest Asian markets, Greater China and Japan, were down 33% and 29%, respectively, although we did see improvement through the quarter in China and all of our offices there have reopened. Malaysia had a superb quarter, up an excellent 23%. Overall consultant headcount in the division was down 10% in the quarter and 8% year-on-year. Cash flow and balance sheet. We ended the period with net cash of GBP 365 million, excluding GBP 120 million of net short-term deferrals of tax payments. This was driven by strong cash generation, including GBP 110 million inflow due to the partial unwind of the temp trade debtor book and a strong performance by our credit control teams throughout the world, which reduced debtor days to 34 days versus 35 days last year. On the 2nd of April 2020, we raised GBP 196 million via an equity raise with heavy participation from our long-term shareholders, and we are highly grateful for their support. Our considerable financial strength underpins our strategy and gives us significant confidence for the future, despite heavily uncertain markets. For the avoidance of doubt, it is unlikely that the board will resume dividend payments FY 2020. Looking forward, we remain conscious of the importance of our dividends to shareholders and will look to return paying dividends as soon as it is appropriate. Finally, during the quarter, we were admitted into the Bank of England's uncommitted CCFF scheme. This scheme has provided great support to UK PSC. I am pleased to say that based on current forecasts, we are highly unlikely to utilize this facility. Of course, this is in addition to our GBP 210 million revolving credit facility which runs through 2024. Current trading and guidance. In addition to the comments I made at the start, I would highlight five further points. The group traded at broadly breakeven level through the fourth quarter, and we expect full-year operating profit before exceptional items to be in the GBP 130 million-GBP 135 million range. Additionally, as I mentioned earlier, we expect to incur exceptional costs both in the restructuring of our German business and other such programs, and also as we perform our normal year-end reviews of items such as goodwill and acquisitions. Secondly, we estimate the group's net fee exit rate was in line with the level of fee decline for the quarter overall. While current activity levels have improved, we have seen no signs yet of positive fee momentum. Three, as I stated at the beginning of the call, while we will continue to closely control and monitor our costs, we expect our periodic cost base to increase as we enter FY '21. The combination of cost increases and continued tough market conditions mean that we anticipate being modestly loss-making over Q1 FY '21. A return to profitability thereafter will require a sequential increase in fees, which in the early phase of recovery should deliver a very high rate of incremental profit drop-through. four, we have recently completed a strategic return to growth review of each division and agreed significant accelerated investment projects in attractive structural growth markets, including IT and large corporate accounts. We are confident that these investment projects will accelerate our medium-term growth and position us to take market share. After taking this investment into account, we may well be modestly loss-making in the first half of FY 2021. five, although currency translation has no impact on like-to-like net fees in the quarter, exchange rate movements will remain a material sensitivity to the group's reported results. In conclusion, this has been a very tough quarter and the most challenging work environment I've ever faced. On behalf of our board, I'd like to express again our collective thanks to our shareholders, colleagues, and other stakeholders for their deep support and commitment. The combination of our significant financial strength, highly experienced management teams, and leading market positions gives us confidence for the future despite the many uncertainties ahead. I will now hand you back to Jose, our administrator, and we're happy to take your questions. Thank you. As a reminder, if you would like to ask a question or make a contribution on today's call, please press star one on your telephone keypad. To withdraw your question, please press star two. You will be advised when to ask your question. The first question comes from Rory McKenzie from UBS. Please go ahead. Morning, all. It's Rory here. Three from me, please. Firstly, I appreciate there's a lag from client activity to your fees. With May, June stable overall, did you see any evidence of improving net fees in any countries or regions? I guess a follow-on to that, the second question. You had a net fee drag from releasing temps in the Q4. Should we expect more drags in the Q1 of the current financial year? Those two first, please. Rory, just so I'm clear on the second one, is that a generic question across the board or specific to Germany? Specifically in Germany, because that's where you called out in the same year. Okay. I guess there's kind of two related positives, aren't there? The first is that we were broadly sequentially stable across May and June. If we thought there had been any material changes in trends across this, we would have raised them in here. As it is, June, for example, was exactly in line with the overall fee part. Clearly, at the regional level, for example, Asia was slightly worse in June simply because, as most people will know, it was coming out of its original lockdown as we came across March, and therefore April was a bit better. Some of those markets went back into lockdown as we went through May into June. Again, I think from a materiality standpoint, it's not that significant. I guess on the other side of it, Europe, certainly Europe ex-Germany, performed slightly better as we went across June. No real material trends there. On the activity, look, there's kind of two or three separate things here. Activity levels have remained reasonably strong across the lockdown phase. Clearly, all of our guys and girls are working incredibly hard on talking to candidates and clients. Whilst activity trends have picked up as we've gone across June modestly in most of the markets, it's unclear to me yet when those will convert into fees, Rory. I think there's two or three things in the back of my mind. Clearly, I have the benefit of having done this job for more than 14 years now. The first part of it, I think, is for a lot of clients who perhaps didn't do any hiring in that early phase of recovery, what is hard to tell is some of the activity we've got at the moment, is that just filling the urgent jobs or is that going to be sustainable beyond a period of time? Secondly, of course, I'm very conscious, as in every year, that we normally see a slowdown in activity as we go across Europe, and specifically in places like France and Spain, activity levels tend to reduce, we lose visibility. My positives are fees are stable and activity is a bit higher, but it's too early to see that converting into fees. On the temp part of it, look, I think the positive is, of course, that most of our clients' operational sites have opened or are opening. It doesn't mean that in the automotive sector, of course, that all of the car manufacturers have restarted all of their operations. Quite a lot of it is on a phased basis. Without a doubt, we've had some of the worst idle time across this period of time, and you've seen that in the reduction of billable hours. I expect the reduction in billable hours to continue certainly for the next three to six months, because I don't think our clients are going to bring back full utilization of everybody. At the moment, we've still got about 500 temps who are on the bench and who are inactive, and we have about 600 temps who are working part-time, so there are some hours, and then we have 2,500 temps that are working fully. We're certainly in a better position at the end of June than we were in the middle of May. What it's too early to tell is as clients return to work, do they then look across their activity levels and determine what temps they need going forward? I think we'll have more uncertainty over the next couple of quarters. Instinctively, I think we've had the worst month so far, but from a magnitude standpoint, kind of the GBP 6.8 million and the GBP 4.3 million, we may well have similar numbers over the next six months. I think we've had the worst, but I still think there's some uncertainty. What's fascinating, of course, is when you compare temp and contracting in Germany. The contracting part of it is an interesting situation because fees down 12%, that is actually better than the volume. Volume declined by a bit more than that. Contractors who were all able to work remotely, primarily in the IT space, all of them were pretty much required by our clients, and that's continued as is. Where I think with temps, whilst they're still highly paid, our average temp earns about GBP 80,000 a year if they work for a full year, I think that's going to be a more gradual recovery because, as I said, most of the manufacturing and car plants are only bringing back part of their activity. I think we've had the worst quarter, but I think we may have a similar magnitude over the next six months, but time will tell. Yeah. Thank you. That's helpful. Just the final question was on the investment projects you mentioned. We lost you, Rory. Hopefully about- Jose, are we still on? Sorry about that, Rory. You can continue now. We lost you, Rory, I'm afraid. That's all right. No worries. I'll just go again. The final question was just on the investment projects. Can you talk more about what scale and form they will take and how you assess payback, given the obviously difficult outlook in general? I don't think we're really focused on payback, Rory. I think one of the benefits that we've got such an experienced management team that Alistair and myself have been running the business now for the last 13, 14 years, is we know our business incredibly well. We know the markets very well. You can see across all of these results that IT has been, from the large specialisms, our best performing specialism. We are very determined that in our tenure, that we will become the largest global IT recruiter. We're probably already the largest quoted global IT recruiter, but of course, there's some big U.S. businesses, and we're determined to invest in that market. A lot of this is effectively increasing headcount. It's investment, it's headcount that we would have let go otherwise. It's increasing headcounts in the IT specialism. It's increasing management. It's also in our corporate account business, adding a lot more account managers, because what we have seen, certainly in all of the work we've done in Germany and the U.S. over the last few years, that we've got lots of opportunities. We finish that work. We're talking in the region of about GBP 20 million worth of revenue investment in FY 2021. I think one of the benefits of the strong financial position that we're in is that we can use that firepower and deploy that. This is not really focusing on what is the return in FY 2021. That's of limited interest. What it is making sure is almost ahead of market stabilizing, that we position ourselves really well so that when markets do stabilize, we can be very aggressive in our fee growth, and that can drive fee growth in FY 2022 and FY 2023. The investment is in a number of regions and specialisms across the world. Alistair, when we come to the August, our results presentation will take everybody through this in detail, but mainly it's in IT, it's in our large corporate accounts, it's in Life Sciences, and it's aimed around most of our major businesses, Australia, Germany, U.K., very large investment in the U.S. I think that's the benefit of the financial strength we're in. Great. Thank you very much. The next question comes from Hans Kluijters from Kepler. Please go ahead. Yes. Morning, gentlemen. You pointed out that also you're expecting some restructuring cost. You already mentioned there were severance costs for Germany. Of course, I can imagine that from the goodwill side, you still, of course, have to do all the calculations. Could you give some more, let's say, detail on what level of restructuring cost you expect, excluding the goodwill impairments? Yeah. Look, I think we're expecting two exceptional items. The first is restructuring. That's predominantly in Germany, where we've incurred about GBP 13 million worth of costs. We expect that to return, give us annual returns of about GBP 10 million a year. Of course, we actually did all that work in February. Our timing was quite good because it was all completed by the end of February and therefore ahead of going into COVID. On top, as you will expect, that we've also looked at all management positions around the world, and there are some additional costs. I would expect in total, we're going to have a restructuring exceptional cost in the region of GBP 20 million. Then I think we're done. We're not expecting to have anything further in FY 2021. Certainly anything else will be modest. We've finished all of that work. We've been very busy over May and June. Secondly, for those of you that are active readers of our annual report, you will have seen over two of the last four years, we've raised that we've had limited headroom on goodwill on our U.S. acquisition. We are in this kind of perverse situation. We've got a great business. We're very proud of it. It was performing incredibly well going into the pandemic. It's done well during it because we think that a good slug of that business now is in Construction & Property. That's a difficult market. Therefore, we are utterly determined. We got a strong management team. We are impressed very heavily. What I don't want is the CFO to feel hamstrung in the amount of investment we do versus also justifying the goodwill on our balance sheet, which of course, you've always got to be looking at returns you're going to get over the next two or three years. Therefore, similarly, we're expected to do a goodwill write-down in the region of GBP 20 million. The purpose of that is that removes any concern then of goodwill going forward, where we will keep GBP 20 million on the balance sheet. It enables us to do all of the right things in building a large U.S. business. If you actually look at the numbers across this quarter, which is why I got my tongue tied earlier on, the U.S. was our fourth largest business in this quarter. We're determined with the strong team we've got to really put some rocket fuel behind it. Just getting rid of the goodwill means we can do all the right things going forward, and it's a kind of an opportune time to do it this year. Hopefully that gives you the answers you wanted. Yeah. One follow-up question on the investment. You already mentioned, let's say a group like IT and large accounts, but also any specific countries where you expect to invest more in the coming quarters? This is outside of the normal investment that a country will do. This is material group financial firepower, and therefore it's going to be in our countries that move the dial. Most of the investment will be in the U.S., in Australia, in Germany, in the U.K., and in France. Also, we've got a lovely Asian business and we want a bigger one, and therefore there will be investment in Japan and in China. Specifically, we've got a great business in the multinational market at the moment, but we're determined to crack the domestic market, and we need more investment in that space. Again, Alistair will cover this in detail. I'm sure David will enjoy doing a few slides for him for the August presentation. Okay. Maybe one last question from my side. Looking at headcounts, we reduced it by 9% in Q4. What's your expectation for Q1 or maybe H1 of coming fiscal year? Yeah. We're trying to get the balance right. I think the same with every other business. We're trying to protect as many jobs as possible. In a number of the markets, we've kind of adjusted where we want to get to, and it's in the right position. We got a bit of more work to go in the next quarter, absolutely I expect our headcount to go down further in the next quarter. I think we've done most of the adjustments. Certainly any further reduction will be less than we've done over the quarter. Okay. Thank you. Thank you. Please be reminded, if you want to ask a question, press star one on your telephone keypad. The next question comes from Anvesh Agrawal from Morgan Stanley. Please go ahead. Hi. Good morning. I got a couple of questions. First, just on the cost base, and as you were describing that it's going to increase from where the current levels are. When we sort of compare or in your budgeting, when you look at FY 2021 versus FY 2020, we should sort of still assume that on a sort of full year basis, given the revenue or net fee situation, you will still be sort of able to bring that down. Obviously, it will increase from a monthly cost where it is right now, but on a full year basis, it should sort of still be as it has been in the previous cycle. Second, it's slightly backward-looking, but sort of when we look at your net cash position and then the equity raise you've done, clearly you don't need that money right now. If you can just give us some indication of what are your plans to use the cash that is sitting on the balance sheet apart from some of the investments you have flagged. Look, on the cost base side of it, Anvesh, I would actually love to be in a position next year that our cost base is higher than it was across this year, because that would suggest that our fees have rebounded very strongly. That's not what I'm expecting. Clearly, what we were trying to get over is, yes, we've got fee stability, but all of us know that a lot of businesses have been helped, not just our own work that we've done on our own cost base and our own headcount, but we've also had this kind of strange situation where every single office around the world for large parts of this quarter have been locked and nobody can travel or see anybody. You have an artificial reduction in your cost base, which is unsustainable. Clearly, going forward, very tight cost control, and that's a large part of my job. We will be very tight on cost control. We will reduce headcount a bit further. That's kind of all in train. All we were trying to get over is on a monthly basis, if we kind of being break even across this quarter, we are expecting to see our cost base, the absolute level in costs. When you get rid of all the government schemes, which have been worth about GBP 3 million a month to us, and you're going back to a more normal cost base and things like incentives and everything else, I think we're expecting to see a net increase in our cost base of something like GBP 5 million a month. That will be after we've reduced our headcount. That's kind of why I got into this part. We're going to be modestly loss-making over this quarter. The real key part is there any fee rebound in September and October? Traditionally, things quieten over the summer. You then get a large rebound in September, this year more than most, you would hope that we would get that. For obvious reasons, we have to be very uncertain. What we don't want to do, though, I think this is where the cash coming onto your second one is really useful. Sorry, on the last part of it. In this initial bounce back outside of what we're doing on the growth stuff, we'd expect to take a good 75% plus of any fee increase to the bottom line. We've done that over the past, we'll do it again. One of the benefits of having such a strong cash position is that we can sustain some operational losses if they're the right thing to have. Therefore, we're trying to get this balance right between maintaining muscle in our business, keeping as many of the good consultants as possible, and using them to accelerate, A, growth in targeted areas that we want to do, and then, B, as hopefully the markets return to some growth, to really attack those markets quite aggressively, and the financial firepower enables us to do that. I guess moving on to whether we have too much cash. Only time will tell. Quite frankly, a week ago, we were in this kind of luxury position where pretty much all of our offices outside the U.K. were open. We're sitting here today with every office in the U.S. closed, with every office in Victoria closed. The one thing we know is there's a lot of uncertainty that's going to come over the next six months, year, two years. We are in an incredibly strong financial position. That gives us lots of options, both to organically invest, but also at the right point, return to paying suitable level of dividend. We will, in discussions with our shareholders, we will set out our dividend policy this year. One of the benefits of having cash is that we can return to that before. Also the other bit is we're not hamstrung in any capital investment that we need to do or revenue investment. I think that's a good position to be in. Just to be clear, when you said that the net increase of around GBP 5 million, that is excluding of the GBP 20 million of the investment you are planning over and above. Correct. Yeah, correct. That's why I shifted at the end to say, look, from a simple trading standpoint, we would have been modestly loss-making in the first quarter. I think when you add the investment on top, it's quite possible that we'll be modestly loss-making for the first six months. Clearly, the unknown is will we get any meaningful sequential increase in fees. Personally, I think the next six months will have a quite modest recovery because I think most companies will be waiting until after the summer, and of course, the risk is unless they see a pickup in demand in their business, they may decide to wait into the next financial year. Anvesh, I want to make it positives at the moment for the whole of this crisis. We've had very measured discussions with all of our major clients around the world. The nice position we're in is that rather than wait for recovery to have happened and then to start to invest, we can actually take some pre-emptive decisions, retain more of our headcount, and attack a number of markets so that we're really in a very strong position to drive growth when markets start to return to growth. Okay. That's very clear. Thank you so much. We have no questions coming through at the moment. As a reminder, please press star one if you want to ask a question. Perfect. If that's all the questions for today, we'd like to thank you again for joining the call. I look forward to speaking to you at our next as our FY 2020 results on the 27th of August 2020. Of course, as always, should anybody have any follow-up questions, David, Charles, and myself are available to take your calls for the rest of the day. Thank you all very much. Thank you for joining today's call. You may now disconnect. Hosts, please stay on the line and await for further instruction.