Trading Update

May 23, 2019

Earnings release

Hello, and welcome to the Intertek May 2019 Trading Update Conference Call. My name is Rosie, and I'll be your coordinator for today's conference. For the duration of the call, you'll be on a phone only. However, at the end of the presentation, you'll have the opportunity I will now hand you over to Andre Du Clark to begin today's conference. Good morning to you all and thanks for joining us on the call following the release of our trading statements a few minutes ago. I have with me Ross, our CFO, and then from Investor Relations team today. I'd like to give you an update on the book trading performance in the 1st 4 months of the year and importantly discuss the outlook for the rest of twenty 18. There are essentially 3 main messages in the call today. First, we had a good start to the year in line with expectations and we are on track to deliver our full year revenue margin and cash target 2nd, we delivered a broad based organic growth across of 3 divisions as we saw organic growth in product, trade and resources. And you all know, this is the first time that we are seeing this positive trend for many years. Our acquisition in attractive growth and margin sectors are performing very well adding 200 basis points to our revenue growth. So let me start with the highlights of the 1st 4 months of trading in 'nineteen. The group revenues were 900 and 24,300,000 pound an increase of 5.3% at constant currency and 7.3% at actual rates. Our group organic revenue growth at 3.3% constant currency was in line with our expectations and the acquisitions that we made since January 2018 delivered 2% revenue growth. Our disciplined approach to costs and margin management remains firmly in place in each part of our group We continue to be very focused on cash conversion and disciplined capital allocation. All the comments I will make are at constant and before sharing a trend, we see in our product, freight and resources division, let me cover guidance and currency. As I said, minutes ago, the group is on track to deliver its 2019 target of good organic revenue growth at constant currency with moderate margin expansion and strong cash conversion. We expect good organic revenue growth at constant rate in each of our 3 divisions: product, trade, and resources. From a profitability standpoint, we expect to deliver moderate margin expansion, leveraging our portfolio strengths of pricing power and our systemic approach to performance management. We continue to expect to deliver strong cash conversion. We are investing in growth and expect our full year CapEx investment to be circa 1,000,000 to 1,000,000. We continue to expect to close the year with net debt of the car $670,000,000 to £700,000,000. This is of course pre the impact of IFRS 16 before any M and A activities and based on no further material movement in ForEx. In terms of ForEx, we are maintaining the full year guidance on currency we communicated a few weeks ago in March. Based on the year to date performance and the average for rate in the last three months applied for the remainder of the year, ForEx will be broadly neutral for the full year outlook both in revenue and earnings level. Let's now move to the divisional reviews and I would like to give you an update on each of the divisions in the 1st 4 months of the year, starting with products, which performed well in line with expectations. Product related business delivered a robust trading performance with a revenue growth of 5.5% driven by an organic revenue growth 2.6% and by the benefit of the acquisitions made recently. We are comping against a high base last year when we delivered a 6.6 2 positive regulatory challenges in business assurance and chemical pharma, as well as from the delay of large U. S. Building construction infrastructure projects from 18. Moreover, our business with Toys R Us was still in the base during the period. Our Softline business delivered solid organic revenue growth benefiting from supply chain expansion of our clients in new markets, the rapid expansion in the footwear sector and the increased demand for chemical testing, we are heading with existing and new clients. Our full year guidance of solid organic growth for Softlines remains unchanged. Our hard line business reported solid organic revenue growth, driven by innovation from our clients, leveraging technology to make toys smarter increased demand for chemical testing also and innovative inspection technology. We are making good progress on business with our clients and our full year guidance for hard lines of good organic growth remains unchanged. We delivered robust organic revenue growth in Electrical And Connected World, which benefiting from electrical appliances innovations to provide better efficiency around world, increased demand for IoT insurance services, including, of course, cyber security and data safety. Our full year guidance of robust organic growth for electricalite and connected world remain unchanged. Our business assurance business delivered good organic revenue growth. We are comping versus a high base last year when we benefited from the increased demand from our clients for either audits to meet the Q3 'eighteen deadlines of standards upgrade. Our full year guidance of robust organic growth for business assurance remains unchanged. We are seeing a strong demand for our non ISO assurance solutions we are benefiting from the increased focus of corporations and supply chain and risk management, and importantly, increased consumer media and government focus on ethical and sustainable supply. In our Building Construction business, we are comping against a high base in 'eighteen and we have delivered a solid organic growth as expected. You might recall that the inspection activities of large U. S. New project in 2017 were soft following the presidential election and that in 'eighteen, we benefited from the fast ramp up of several projects that had been delayed. We are seeing good traction with our business development activities and our full year guidance of good organic growth for business building construction remained unchanged. In our transportation technology business, we delivered robust organic revenue growth, driven by continued investment of our clients in new models and new fuel efficient engines hybrid and battery technology being really, really fast growing these days. And importantly, we are benefiting from increase scrutiny on emissions, as you know, car manufacturers now need to test and prove their claims on the road. Our full year guidance of robust organic growth for our Transportation business in 'nineteen is unchanged. We generated robust organic revenue growth food business, driven by continued food innovation, increased focus on safety of the supply chains and the growth in food service assurance businesses. Our full year guidance, our robust organic growth for food business remains also unchanged. We saw an organic growth revenue below last year in our chemical and sunlight business. As in the first half of 'eighteen, we benefited from a robust growth ahead of our expectations as our clients increase activities to meet the July 1st reach deadline. We are maintaining our full year guidance of solid organic growth for our Chemical and Pharma business, our partner activities, our times is strong, reflecting the growth of SKUs, the expansion of supply base in emerging markets and increased from consumers and regulator on product safety and traceability. Percent of our earnings to deliver good organic revenue our trade business as we've delivered a revenue growth of 6.5 percent, one of the highest gross numbers we've seen for many years, driven by robust organic growth of 0.3% and the benefits of acquisition. Our cat bed business reported good revenue performance. We continue to benefit from the global and regional trade growth drivers in each part of our business. Our full year guidance of good organic revenue growth for Canada Bread remains unchanged. Our Government And Trade Services business did even double digit organic revenue growth, driven by volume growth with existing contracts and benefiting from the win of several new contracts across many regions. We expect our GTS business to deliver strong organic growth for the full year. Our Adri World business reported good organic revenue growth, and we expect this trend to continue for the full year. So net net for the full year, we expect of trade related businesses, which represent circa 17 percent of our earnings to deliver good organic revenue growth. Turning to our Resource division, our Resourcerated business delivered a good trading performance ahead of expectations with an organic revenue growth of 2.9%. We are pleased to see, as expected, an acceleration of the gross momentum in our Resource business, following the stabilization of revenue we saw in 'eighteen. Our CapEx inspection business reported good organic revenue growth as we start to benefit from the increased investment of our clients in exploration and production infrastructure around the world. We expect our CapEx inspection business to deliver good organic growth in 'nineteen. The demand for OpEx maintenance service remains stable in a competitive environment and we expect this trend to continue for the remainder of the year. We continue to see an improved level of demand for testing activities in the mineral business in our various regions, and we've delivered a good organic gross performance of full year of good organic growth guidance for Minerals remains unchanged. Net net for the full year and based on the improvement, we are seeing in our CapEx inspection businesses, we expect our Resource business to deliver a good organic revenue performance. A few words on M And A, the acquisition made since January 2018 in attracting gross margin sectors are performing well. In March 2018, we're quite a leading provider of quality and quantity cargo inspection services in the growing region of the Med. In April 18, we acquired retesting and inspection services, consolidating our leadership position in the fast growing market in Colombia. In June 'eighteen, we acquired NTM Monitor, a leading network in insurance service providers based in the UK and Malaysia providing end to end cybersecurity services to corporations and governance. In August 2018, we acquired Alchemy, a leading provider of SaaS based people assurance solutions in the food and retail sectors based in North America. And in addition, in March 'eighteen, we entered an exclusive agreement with CAPA to run the Automotive Fast Certification Program. As always, we'll continue to actively pursue expansion opportunities in attractive growth in margin areas with value enhancing acquisition. So in conclusion, I wanted to share 3 main messages for you today, with you today. First, that we had a good start to the year in line with expectations, and we are on track to deliver a full year revenue margin and cash target. 2nd, we delivered a broad base any growth across 3 divisions, product, trade and resources, which is good news for the group. And 3rd, that our acquisition and attractive growth and margin sectors are performing well and added 200 bps to our revenue growth. Intertek is going from strength to strength, making progress set by step on a good to great journey with our 5 by 5 differentiated strategy for growth. We provide a superior customer service with our unique total criteria assurance value proposition that is helping our clients mitigate quality and safety risk in the increasingly complex operating environments. We are well positioned to deliver GDP plus organic revenue growth in real terms based on the attractive structural growth drivers. We see our Product divisions, which represent 77% of our group earnings will continue to benefit from GDP agnostic growth drivers. Our trade division, which represents 17% of group earnings, will continue to benefit from global and regional trade growth. And our resource sectors, which represent 6% of the group's earnings will benefit from the global growth drivers in the total energy sector. Moving forward, we'll see these attractive organic and inorganic growth opportunities to deliver sustainable growth for our stakeholders. And the first question comes from the line of Edward Stanley from Morgan Stanley. Please go ahead. I've got a couple, please. On chemical part of products, can you give a bit more information on how big I guess in basis points that impact was to the products division that comp effects on reach and whether that will, I guess, annualize from June and go back to normal Secondly, on soft lines, you say you're doing very well in footwear and chemical testing. I just wonder which other segments are slight offsetting that growth to come out at solid? And thirdly, on the CapEx point you give your guidance and just wonder, given quite a few changes in the mix of growth in the business, what you're thinking in terms of CapEx allocation and which focus areas you have for this year in CapEx? Okay. Let me just take each question at a time First, I mean, chemical and pharma is obviously an important business for us. As you know, we do not disclose the relative size of the business line inside of products. Based on previous disclosures, you can get a sense, we operate chemical and shama operations in Europe, in the U. S. We also have a very strong assurance business in the U. S. Called Cantox, which is a leading insurance providers and regulatory and health and safety. And Rich was a major, you know, challenge for, you know, importers of, you know, chemical materials and you know, these, you know, dead of May 31 last year was, a bit of a rush for lots of corporations. So we saw, as you would recall, a very, very, very good performance of our business in the first half of last year. And that's why this year, the business is slight below last year. We believe that, you know, this is a, you know, based on the run rate that we have, the pattern of activities that we see the orders discussion we have our clients, the base will get easier in the second half. As far as soft line is concerned, the reason why I'm seeing out a chemical, because this is an important growing demand for clients and this is very profitable and we are quite strong around the world given our strengths are strong in softlines and hardlines. It doesn't mean that physical testing is not is not growing. I was just trying to say this is one of the fastest growing with footwear, the physical testing continues to grow. And as you know, when I say so, there is a bit of a So don't read the wrong insight there. And as far as CapEx is concerned, look, we are very focused in looking at attractive growth in margin sectors. And you've seen, we're investing a lot in technology with our SAS approach Alchemy is an acquisition we made, but we're also doing a lot of organic developments with our own insurance solution that our size delivered in light for instance is an area of investments. We are doing the same in terms of global market access. We continue to invest in transportation technology, the demand for hybrid and electrical vehicles is really, really strong. I mean, you see the data for the automotive actors, OEMs have got to accelerate their R and D investment. And this is a big area for us. The other area where we are investing quite a bit is, as you would could have connected world helping our clients to manage the complexity. So there are some of the areas, but we also investing in Caled Breadth and GTS behind some of the growth opportunities. So it's really, really focused and really in line with our strategy to really allocate our capital to the good growth, good margin sectors. The next question comes from the line of Paul Sullivan from Barclays. Please go ahead. Good morning, Andre. Firstly, I mean, could you, any would you comment on the U. S, obviously, U. S.-China trade escalations. And with some surveys pointing to up to 40 of U. S. Manufacturers looking to shift production out of China. Do you think that will trigger a restructuring of your network as you your resources around? And then when it comes to sort of organic growth confidence for the full year, do you think you or how confident are you, but you'll see an acceleration in organic growth from the 3.3% from here? Let me start, please. Thanks, Paul. Let me start with the second question. Look, we are maintaining our guidance for the full year in terms of organic growth. And if we were not confident we wouldn't do that, as you know, we had a very high base of 6.6% in our in the 1st 4 months of the year, 4% for the group. And that's basically a baseline effect, which is driven by 4 business lines that I explained. And and we are confident in our full year guidance. As far as the U. S. And China trade discussions, We've talked about, this topic in these calls in the past. And let me just, you know, a refrain for for everyone, some of the key numbers here. The total value of the import subject to tariffs today, account for 0.5% of the global GDP that's one thing that we will need to have in mind. The second thing, I would say is that China accounts for 17% of the U. S. And the U. S. Account for 16% of the China trade, which means that as we all expect, China and the U. S. Have got multiple trading partners. And then an interesting really start that the sum of the value of the Chinese imports into the U. S. And the U. S. Imports into China is one 0.4% of global trade. So I just wanted to frame that so that we all have the numbers in mind of what these discussions are covering in terms of basically size of global GDP. What is it that we are saying, Paul? Look, as I said in the previous call, I've got a task force that I lead personally with all my key, regional and business line leaders. To basically make sure to Thailand, to India, we are there to help them. And there are interesting, dynamics here. First of all, you know, it has not, it's not a new thing that corporations are putting on the table, trying to look how they can optimize the manufacturing footprint. And we've seen corporations over the last 10 years doing so, moving low added value activities from China all the parts of the world. And we have basically helped them to move their supply chain. That's what we do anticipating where the supply chain of our clients is going is really, really part our role. And when we do that, there is obviously some interesting work for us because we can help with Assurance. And to your point, because we have a global net work, we are obviously well positioned to do so. That will be the first thing that I would say. The second thing I would say is, look, There is no question that changing production locations for any brand that manufactured in China is not an easy decision. It's, as a matter of fact, quite a high risk decision because you have a production system that works in China. You've got your Tier 1, TSP supplier. You've got the logistics. So it's quite complex. I'm not saying that, you know, there will not be some additional but so far, we've now seen a rush of corporations say, you know what? This is going too far. We're going to move. Now when you ask people are they thinking about it are they monitoring what's happening, of course, and we are doing that with them. The final thing I would say, Paul, and I just came back from China. And I was editing some of the production locations around the country. One should not forget that the manufacturing level of excellence in China is very, very high. And this is something that brands have to take into consideration because the quality output, the discipline of operational delivery in the China factories in many, many categories is really, really high. So what am I saying? Look, we are all monitoring the situations. This is not the new trend. We've done that before. If our clients want to move. We are ready. But so far, it's been pre, pre, I would say, quiet in terms of companies making the decision. So that's the update was going to give you and your colleagues because I realized this is an important question for everyone. The next question comes from the line of Will Cactus from Jefferies. Please go ahead. Good morning. Thanks. I've got a questions, please. Firstly, just wanted in your trade business whether you saw any benefit from IMO 20 20 to that good organic growth in Calibreux? And then secondly, if you could just talk about the OpEx business and resources being stable. Is that trend consistent in both the volume and the pricing metrics? Yes, I mean, on the second question, yes, on the first question, look, IMO is an interesting opportunity. It's is the global leaders in terms of quality and quantity and testing around the world. It's going to start, but it's not really the driver of the performance on on the global scale. It's positive, but it's not game changing for us. The next question comes from the line of Alex Nies from JP Morgan. Please go ahead. Just firstly on Alkami. I wonder if you can just comment how it's been performing 1st 4 months of the year. And if you could comment on preparations to expand that business outside North America, that would be interesting. And secondly, with regard to M and A, it's been a little while since you last did a deal. I wonder if you could comment on the availability of appropriate and the sort of price expectations you're coming up against? Thank you. Yes, let me start with second question. On M and A, as you know, we are really, really disciplined and if we have not announced the deal, it doesn't mean that we've not looked at transactions. We do that all the time. I've got a great team, led by Giulia here in London, and we are obviously in contact with lawful of companies around the world. And this is basically what's happening with our pipeline. We have not basically seen a transaction that we would like to make happen, but the deal flow to go it like this continues to be very, very attractive. As far as asking is concerned, look, spent quite a lot of time with clients, as you all know, and in all my discussions with, retailers and food companies because today, Alchemy is essentially in the food sectors and the mobile side sectors. And people says, you know what, people assurance is the next frontier. Corporations has spent a lot of times over the last 2 or 3 decades to look at processes, to look at engineering, to look at factories, to look at packs. They've done a lot of work in terms of testing inspection, certifications. We've seen a growth in system assurance. But where corporations really like focus is, do they really understand the effectiveness of their colleagues around the world? Doesn't matter if it's a frontline employees of a factory in Michigan or if it's the staff of Burger King Restaurants at the Toronto Airport corporations are really, really struggling to understand how disciplined focused motivated engaged the frontline employees are and how these employees where they see a high turnover are basically delivering and not delivering their brand standards. And therefore, creating quality issues that make the headlines and create obviously a lot of problems reputation and shareholder value for corporations. There is no question that we are onto something big with our insight. And every client I talk to doesn't matter if it's in North America, in Asia, in Europe, see it. And we had a conference in the food sector a few months ago and some of the European retailers as well. We didn't know that, that would exist. And you heard me talk about it in the past. If I had Alchemy when I was running Burger King International, my life would have been very different. And certainly, my results would have been much better. So look, this is the market is there. As far as the progress we are making, look, it's a step by step journey, we are basically scaling up the business based on our North America platform. It doesn't mean that we don't reach out to France outside of North America because a lot of our North American plants have got global operations. So that's part of the expansion. I want us to stay focused on food and multisite for now because I think that's why we bought the business. That's where we have the winning solutions. That's where we have the contacts. And that's where we have the delivery plan from to do so. But there is no question over time, we'll be able to extend that. So look, there is no question that we answer something very significant here. And from my perspective, in the world of total quality assurance, which is, as you know, a risk based assurance to help clients mitigate the product quality, safety and sustainability in addition to assurance of processes, people assurance is an excellent Tier 4 corporation. So I'm very excited. The next question comes from the line of Omry Pilar from Kepler Cheuvreux. Please go ahead. Yes. Good morning. Thank you very much. The question is a follow-up actually on Al Shimi progress. Could you quantify the contribution of Algymi to the M and A contribution? So, to the 2% in Q1 and the contribution of the business you've acquired also. So just to understand the size of the contribution and the progress, obviously, that that you had in terms of growth rate at Ashmi. That's the first question. And secondly, looking at the oil CapEx inflection on the resource side that you mentioned and the uplift of guidance for organic growth this year. What do you actually see in terms of, outlook for Q4 in particular and as we move into 20, how big is the upswing that we could anticipate as an exit rate for that segment? And is also in terms of the margin traction, how significant could it be to the outlook for margin at Intertek? Thanks, Amy. So, look, in terms of acquisition, when we make an acquisition, we typically do a very specific disclosure on the size of the business and the type of revenue. So that's if you want aesthetic information. We do not obviously report the revenue performance of individual business lines nor individual acquisitions. It will be, a lot of details. What I can say is that, you know, we are very pleased with Alchemy. We are on track And as you know, we've given 5 year guidance when we made the acquisition in the summer last year. So we are really, really pleased on where we are, and that's the only thing I would say. As far as resources is concerned, So it's a very good question, Eric. Thanks for asking that. There is no question that our resource business has been through an unprecedented downturn. If you really think about it, the last time we saw growth with our Moody inspection business was 2013. So it's been 1, 2, 3, 4, 5 years of consecutive revenue decline and margin decline. And if you really think about the peak to trough and 'eighteen being our trough year. I mean, we basically have seen almost a third of revenue reduction through these five years of unprecedented downturn and the profitability has been slightly more than half. So we are really excited about the fact that there is light at the end of the tunnel. And I would say there is sunshine, because we are seeing growth in the industry. Now what we are seeing is several things. The oil and gas clients of ours are basically expecting to invest around 5.6 5% to 6% more in CapEx this year. That's if you want what the consensus is, it doesn't mean that the growth we're going to see, because we are, if you want, highly technology, you know, investment link in terms of inspections because we tend to inspect a really, really complex infrastructure equipment they put in the in their businesses. So we tend to be in the latter phase of the infrastructure project, but we are seeing some growth as I talked in the call today. And that's really good news. My sense is the oil and gas companies have a much better financial performance behind them now after an unprecedented downturn, they realize that they need to invest in they need to build capacity because demand for energy is growing. And what's interesting moving forward is it's not going to be just your traditional oil and gas investment in terms of infrastructure inspection opportunity for us. It's also going to be renewable chemical power plants. And because the oil and gas plants, and we see that with our 18 discussions, really saying, you know what, we are not oil and gas companies. We are energy company. And the way I see the industry is moving to, what I call, total energy, where, you know, when our ATIC, you know, discussions with all the oil and gas companies say, look, we need some help in our typical oil and gas infrastructure investments, but what is your capability in renewal? What is your capability in chemical plants? What is your capability in supply, in sustainability? And importantly, what is your capability in AI and making sure that you help us connect the dots because they want to have an end to end approach. So look, It's been a tough 5 years for the oil and gas industry. I think we are seeing some better days step by step. And I think the opportunity for us in terms of revenue and margin is significant because in that experience, when you begin to go in downturn like we been, you should be more productive on the upturn. What means is that you should not need the same amount of revenue to deliver the same amount of profit. So That's what I would say to your question. Thanks, Amariq. The next question comes from the line of Sreedesh Kumar from H. FBC. Please go ahead. Just reflecting on your earlier commentary, on the U. S.-China trade. Are you suggesting that your customers have actually not started shifting manufacturing based on the ground or having discussions with you where to move or is it just too early in the process for them to know? Is that right? What I was saying, thanks for the question. What I was saying is that, look, our clients have been moving production from China to all the parts of their supply chain around world and we've been supporting them and obviously providing assurance services to help them and supporting them at the other end. At the moment, what we see with our clients is that looking at the situations because making a decision to change the supply base from China is to another country is a very, very important decision. There is CapEx. There is quality. There is system issues. And they are basically monitoring the situations, and that's what we're seeing. I'm not saying it's not going to happen. I'm saying I'm not saying it happened for now. So if you starts to it starts the process starts, say, in the next couple of years, how well prepared do you think you are in terms of availability of labor capacity subcontractors in Yes. I mean, look, anticipating where our clients take the supply chain is a very important focus area strategically. Operationally, we've done that for decades and we do that every single day, because it's not only about China, a lot of companies changing supply chain from time to time. And, you know, we have obviously, the surveillance monitoring in place as talked about, I've got a task force that I personally need to make sure that we provide our clients with the ultimate support they need. And we'd be very happy to help our clients. Because frankly speaking, it's an opportunity for us, because we are very good at it. And we can use this opportunity to obviously offer a global market assurance solution, risk assessments. I mean, this is a, this is positive for Intertek. So we are there. We have our clients if they want to do so. And just in terms of the margin differential, not the exact numbers, but in terms of order of magnitude, suppose it starts moving to Southeast Asia from China. Did you see a potential margin accretion opportunity or dilution rest? Look, we operate with more than 200,000 clients around the world. And, how could you expect me to make a statement on potential margin opportunity, if you got a few 100 clients in a moving base, supply base from one place to the So look, our business is very, very diversified and we are very focused on margin accretive opportunities, assurance solutions, our margin retive. So, I'm not worried at all. The next question comes from the line of George Gregory from Exane. Just a couple from me please. Firstly, on, on hard lines, I noted in this statement that you delivered solid growth across your main markets. Does that reference anything smaller markets or does that growth rate apply to hard lines in total? And secondly, just on Alchemy, do your, are your full year expectations for the impact of Alchemy on the group margin unchanged, please? Is there anything changed there? Thanks. Thanks, Josh. Yes, on the second question, we are not changing our assumptions or guidance on the impact of Alchemy on the group margin. And as far as hotline is concerned, look, our headline business is concentrated in a few markets. That's why these markets represent 90% of our business. So that's why scriptures like this, but it's across the board. The next question comes from the Hello, Tom. Your line is now open. Please go ahead with your question. Sorry. Just following up on your, on the products business. Have you seen any, actual in increasing frequency in tests at all from over, from from US brands. We were a little bit that people may try and to reduce quality as tariffs have come through. Also just the run rate of the products business as you sort of, events of months 3 4 in the 4 month period, was that at all a little bit faster? Because presumably there was a bit of sort of negative catch up with early pull through of product at the beginning of, of the year. And then Also, just your experience when you have moved business abroad, is there, oh, sorry, out of China Safe Southeast Asia. Have you seen an increase in frequency of tests when that initially happens, please? Thanks, Tom. Look, we've not we're going to take them out of time. We've not seen any change of if you want testing protocol. For brands that are manufacturing in China. As you know, brands take their equity and safety standards very, very seriously. So no chance there. Look, on run rate, I would like to be helpful. We are excluding the 1st 4 months of the year. And all the guidance we give is based on all the analysis you can imagine and I cannot go into monthly data, sorry for that. I'm sure you appreciate why. As far as, you know, when the brand moves, manufacturing from one location that just say, you know, value to let's say, Vietnam, I mean, they would not change the testing protocol because they have a certain, level of quality and safety and systemic standards, and they want to have the same. I think, so there is no difference in terms the amount of work we'll do in dialing versus the amount of work we'll do in Ottermine. What's interesting when we do support our clients to transfer their business from there to there, is they will need some support in terms of rethinking, you know, Tier 1, Tier 2 supply base, rethinking their operating systems, obviously looking at global market access, because sometimes there are different regulations, in, depending on the country where they operate. And looking at also at their distribution systems and the inspection. So it does represent a revenue opportunity with what we call assurance solution. And that's what I was trying to explain. So that net, it's positive for us. And would you be able to say where the relative growth of your insurance business in entirety was organically versus the 3% that you have please. I get your question. Yes. Well, no, it's just that obviously you have a percentage of revenue from Assurant. So I'm just wondering where the growth rates of your Assurant space type business lines is relative to formal product testing or inspection I mean, look, our assurance service is one of the fastest growing service line that we have with closed our assurance that inspects on the certification revenue over the last few years, and it continues to do so. And assurance for us is based off industry agnostic solutions, which is what we call BA. And inside BA, you've got ISO and non ISO solutions. And obviously the ISO has got the base effect. I talked about non ISO. We see a lot of interest in many areas. Of the supply chain. Obviously, CSR continues to be a huge growth area, as you can imagine, end to end risk assessment with in light, you know, sales based solutions continues to be a huge area. Obviously, people assurance is a growth area. Sustainability is a growth area. Global market access is a growth area. So there are, I mean, to me, the big insight, that is underpinning, if you want, our total quality assurance very proposition and ethics strategy is very simple is that corporations do more TIC activities than they've ever done. They need to do more But in terms of assurance, this is an area where corporations are realizing that they need to have end to end audit of the processes, skills, and behaviors to complement their tick activities. So, and what's really attractive for us is, is the untapped potential. What is it that should be doing and not doing. I mean, it's another good example is cybersecurity. I mean, the number of cybersecurity issues around the world are connected world business in terms of assurance is doing extremely well. So here are a few examples. I hope it's helpful. Thank you. We have no further questions coming through. So I will hand the call back to Andre for any concluding Sachs. Thank you very much to everyone for being on the call. Obviously, we are available. If you have any questions, Denise is going to be there, for all of you have any follow-up questions, just want to remind everyone, our Hashi results will be announced on the 1st August and we'll have a call as we always do. Thank you very much, and have a good day. Thank you for joining today's conference. You may now disconnect.