Good morning, ladies and gentlemen. Welcome to this IWG PLC Q1 2021 Trading Update. Can I just remind you that this call is being recorded. During the call, all participants will be in listen-only mode, and after the update, there will be an opportunity for questions. I am now delighted to hand over to Mark Dixon, Chief Executive Officer. Please begin your presentation.
Thank you, operator. Welcome everybody to today's call on our Q1 trading update. I'm joined on the call today by Glyn Hughes, the Group's Chief Financial Officer. We're going to take questions at the end of my introduction. As expected, Q1 was a very tough quarter as the impacts of the pandemic continued. We have our toughest quarter comping against what was our best ever start to a year in Q1 of 2020. This clearly is reflected in the results announced today. In constant currency terms, open revenue was down 16%. That compared to a net 18% increase in Q1 2020. However, as the quarter progressed, we saw some positive signs start to emerge, most notably in occupancy. After experiencing gradual sequential declines in like-to-like occupancy since the onset of the pandemic, we saw in February occupancy stabilize for the first time.
In March, we experienced the first positive month-on-month improvement. This trend has continued into April and been somewhat stronger. We believe we've reached an inflection point. This Q1 is the nadir of our performance. With the improvement in occupancy, we're also seeing service revenue slowly returning. We're starting to see some modest positive movement on price. I stress these improvements to KPIs will evolve gradually at the beginning as many markets are still facing restrictions. We have seen evidence of faster spring-backs in some markets as they reopen, which gives us some optimism for the future. We are reminded by almost daily media coverage of the positive trends driving demand for our flexible work products. There's an increasing demand for hybrid working overall.
With our network covering 1,129 towns and cities globally, and which no other operator gets close to, we have a quite unique proposition, and this is reflected in the unprecedented demand for enterprise membership deals. In Q1 alone, we signed 54 deals, giving enterprise customers access to our network, and there are many more in the pipeline. It's early days, but we are encouraged by the early development of these deals and the usage of our products and services by these new members. On network development, we added 43 locations to the network and closed 55. 10 of the new locations came with the acquisition of the number two operator in Italy, which strengthens our position in an attractive market. It's always been a very good market for the company.
Particularly pleasing is that over 50% of the organic new locations that we opened were added via capital-light deals. It's a very good trend which we hope to continue. We've continued to make great progress on franchising despite the pandemic. In Q1, we added seven new agreements spanning all four regions, including our first two agreements in the U.S. These agreements added a further 32 committed locations to the network. In total, we have 645 committed locations via 53 franchise agreements, 53 separate franchise partners, and 367 of these committed locations have yet to open. This provides a strong underpinning for future growth of our network in the future.
The same trends that are driving demand for our products and services have significantly increased the interest in partnering with IWG, and we have a very strong pipeline of potential property and franchise partners that will fuel our growth into the future. As we've previously reported, we have resumed discussions on a number of larger Master Franchise Agreements, several of which are in the final stages of the process, and we hope to announce an update in due course on these. We've maintained a strong financial position. On a pre-IFRS 16 basis, net debt at the end of March was GBP 288 million, and we had GBP 809 million headroom. The net debt position is an improvement on the EUR 351 million position. Finally, a word on cost savings.
It's only the Q1 , but we're tracking well in respect of achieving the annualized cost savings we previously announced, and much more to come here. The world of work has been permanently changed by the pandemic. The overall geography of work has changed, and greater flexibility is demanded by enterprises and by workers. This has created a dynamic and very attractive market backdrop for us to grow into in the years to come. Although our business was clearly affected by the pandemic, we were resilient throughout, and we are now starting to see some healthy, albeit gradual, improvements in several KPIs. These early signs of improvement continue to take root in many parts of our business. Those areas first affected by the pandemic, namely Southeast Asia, are coming out of the crisis faster.
Our largest business, the U.S., as we said in the statement, is also showing signs of improvements with some markets like Florida and Texas again seeing healthy growth. Recovery has been slower in geographies where restrictions have been prolonged. We have a healthy pipeline of potential franchise partners and JV partners for management contracts, et cetera, and our franchise agreements, as I said earlier, and discussions on several Master Franchise deals have restarted. I hope that we can report a continuing stream of positive developments in the coming quarters. Overall, we look forward with cautious optimism to a future where hybrid working becomes the norm and we lead in this exciting market. I'll hand back to the operator to open the floor for questions. Thank you.
Lovely. Our first question is from Andy Grobler of Credit Suisse. Andy, your line's open. Please go ahead.
Good morning, Mark. Can I just ask a couple to start with? You talked about the enterprise deals, the 54 you signed during the period. Can you give us some idea of the kind of size and scale of some of those deals and what impact you would expect to have on the P&L through this year and maybe into next year? Secondly, a difficult question, I guess, but in the longer term, where would you like to think that occupancy can get back to? It's clearly had a tough time through 2020 and the beginning of this year. What is the normalized level in the world we're now in?
Thanks, Andy. Actually, the answer to both these questions, I think, are intertwined. The size of the deals and the impacts, overall 54 deals. It's around 700,000 members signed up. A lot of those came towards the end of the quarter. We've also had more sign-ups as we've gone into the Q2 . Impact comes gradually because it takes time for us to onboard the members themselves. When the company sign up, it takes time to get individuals using. We can see steady improvements week to week as more people use and then come back again. Just looking at, and I talked about this earlier on in the year, we are watching it very carefully, mainly because our concern is that we won't have enough space.
Even though it seems somewhat far-fetched in where we are today, when occupancy does come back, that is longer term occupancy, we want to make sure that we have enough space to continue to service these customers. Overall, this short-term use, which is drop-in use by members, was under one percent of our revenues before, and therefore under one percent occupancy. In the future, this could quite easily become five percent occupancy, and maybe even more. Again, an additional five percent of high-quality revenue makes a lot of difference. If we then turn to what levels of occupancy we may achieve, we don't want to give guidance on this, but I can give you a background of what we're thinking.
We can see in countries where we're through the pandemic and they're getting back to some kind of normality, the business coming back to its previous levels of occupancy or better. Realistically, when we think about it, we had a business pre the pandemic and we experienced the strongest quarter in our history, Q1 of 2020. We should be able to build on that. The demand can only be more than the pre-pandemic situation. The background, and that is why we're adding new centers, and I point again to Q1, more than 50% was done on capital-light deals, so either franchise or management contracts. We want to do more of that to ensure that we have enough space, which we think will be our problem in the future. Therefore, we are expecting to come back to healthy levels of occupancy.
It will take time, healthy levels of occupancy and a recovering price as we go through the year. We've said we expect to get back by probably mid 2022 to sort of full power, if you like, and that with everything recovering. You would expect that the average occupation level should be higher because you have this new layer of business through large numbers of hybrid workers who are looking for a home occasionally. Spot market is going to get much, much larger in the future.
Talking about occupancy levels in the 85% or so, is that an option or a possibility for you guys in certain locations?
Yeah. In certain locations, we'd expect to be 100% occupied. In some locations, we already are. Again, occupancy is an average, Andy.
Yeah.
It's getting all locations up. I would expect that occupancy levels should recover to the same level and beyond. Yes, 85% should be possible. It's much easier to get higher levels of occupancy when you have a larger spot market that is short people dropping in and booking over the app. That's a very effective way to mop up additional availability.
Great. Thank you very much, Mark.
Thank you, Andy.
Lovely. Thank you. We'll now take a question from Andrew Shepherd-Barron at Peel Hunt. Andrew, your line's open, so please go ahead.
Great. Thank you very much, and good morning, Mark. Two questions from me, if I may, just to keep the ball rolling. One is simple question. Can you tell us whether in Q1 where you were on EBITDA? Was EBITDA negative or positive? Which would be a useful guide to know. The second from me is on the Master Franchise Agreements. Of course, can't resist asking a question on those. Can you just talk a little bit more about it? Do any of the potential discussions, how do they square between brand and territory and sort of potential size or location? Anything you could say would be useful. Thanks.
EBITDA Q1 , sort of marginal EBITDA in Q1. That's right at the bottom. That's the short answer to that. In terms of Master Franchise Agreements, there's a number of them that have restarted, and they are spread. That's parts of thinking about it. With the exception of the U.K., sort of discussions going on in each of the four regions for some small and some medium-sized transactions. What's happening is there's a lot of interest now in what we're doing, as I said in my statement. The people understand, people from the property industry, business people, in general, understand that this is going to be a major part of the future of real estate. They want to get involved at what they see as being still an early stage. There is going to be a fundamental change in the way companies are working.
You will see many commentators that say it's all going to go back to the way it was. It is not. Everything I know in speaking to senior people in many, many companies, all of them universally are adopting hybrid work. It's just a question of how many people they're putting onto it and how long it takes them to do it. There are very few companies that are not contemplating it for some parts of their workforce. With that interest, we've got the leading platform. We have technology. Whatever anyone else may claim, our technology works, and that's, as I said in the last call, that is why these large corporations are coming to us because we can put the biggest one we've done, as you know, NTT, we could put 300,000 people, sign them up onto the system.
All of these people get a personalized app, and then we've got the biggest spread network in many cities. It's much more useful. What larger companies don't want is to be dealing with a lot of bit players and have lots of suppliers. They want a platform approach to things. That is what we have. Other people can see that as well and want to invest with us to help grow the network. That is what the next few years is going to be about. It's going to be about partnering with many, many more people to grow this platform as quickly as possible because you can only harvest the investment in the technology through having enough places and enough geographies for people to work. Andrew, back to you.
Thanks for that. I suppose just on the MFAs again, thinking about whether or not any of them could be by brand rather than by geography.
No, all geography.
It's all geographic. Is that likely to be the same?
Yes, because people are. Look, the brands work together. They're picking off different parts of the market that go from budget to top of the range, five-star to, say, three-star or two-star. You need to have all of those brands in order to hit the different price points and hit different work styles. In the end, this is all about the effective conversion of inquiries. Inquiries are expensive. You need variety to convert more, and those brands do exactly that. People do want the whole plethora of brands, and we're adding more. For example, The Wing, very popular amongst their franchise partners. It's a great addition for them. A lot of our existing partners will also be opening up Wing clubs. This is the women-only format.
It's a great addition. It ticks off another part of the market, which is a very attractive part, has very good returns.
Okay. Great. Thank you very much.
Thank you, Andrew.
Our next question is from the line of Steve Woolf at Numis Securities. Steve, your line's open. Please go ahead.
Thanks. Morning, Mark. Morning, all. To follow on from the previous question regarding the openings of new locations. How do you feel now about what you've opened in Q1 with relative to the opportunities you might have for the full year? In terms of the closures against that, are we still looking at some of the older parts of the estate that are under slightly more pressure, or there's an opportunity to put new brands close to those older locations? Secondly, in terms of the restructuring, you mentioned that you are quite a way through and on the way to achieving the outline savings you had targeted previously. Can you mention whether that is mainly at an in-house level for savings or there is still a lot to go through on the landlord side of things? Thanks.
Thanks, Steve. I think, look, just dealing with the growth. It's not an easy answer. In terms of upgrading the network, we have guided to spending some CapEx this year. That is largely for reinvesting in some of the older locations that happen to be in very good locations. That is the ones that we're going to keep. We've got many of these better deals to continue, and we then spend some money on them. I think are there going to be additional brands? Possibly. We're certainly getting a lot of additional centers. We continue to pick up from various competitors, WeWork and many others, sort of takeovers that complement the geography the whole time. Overall, the closures are almost finished.
There's a few more left, where we're haggling about whether we do or whether we don't, but there's not that many left now. Then it will be, you'll start to see net growth as we come through into the second half. We've got some exciting stuff going on that should get us, we're looking to get at quite a good growth rate, subject to us being able to grow in a capital-light way, as we go through the balance of the year. In terms of the savings, just stepping to the second part of your question. The savings are largely there. We're just finishing things off. Again, the legals are being finished off, but we've got a clear line of sight onto where we're going to get to. The next six weeks or so will be about just bringing everything, hopefully, to a close.
As I outlined in my comments earlier, we're absolutely in line with the savings that we put forward.
That's great. Thanks, Mark.
Thanks, Steve.
Lovely. Thank you very much. Our next question is from Michael Donnelly at Investec. Michael, your line's open, so please go ahead.
Good morning. Two brief ones from me. First of all, can you tell us how much you delivered in terms of service revenue in Q1? Secondly, you launched HomeToWork in FY 2020. We've had a quarter of trading with that now.
Yeah.
Can you perhaps give us some economics on how HomeToWork is tracking so far? Thanks.
Okay. Services, look, as we mentioned at the year-end, have about halved. That's a lot of high-quality margin revenue about halved. It's gradually coming back, as I said earlier. We're starting to see more people having meetings. We're starting to see more people drinking coffee. It will come back with occupancy. We're expecting gradual improvements as we go through the balance of the year. What you also heard me say in my statement was that we have seen faster springbacks in some markets. Without going into where they are, because it's very early days. We've seen much quicker pick-ups in some markets than we had expected or that we were seeing on average.
There is some evidence of when you get through to the other side of the crisis, when things do settle down, that things could come back faster than we expect. We, in no way, want to say that that will be universal or give any other guidance than the guidance we have already given, which is back to some kind of normality mid 2022. In terms of HomeToWork, this is an experimental product. We're pleased with its progress, but it is a means to We're only operating it in two countries, and it is a means to, it's an experiment really, to see if we can gain new members through this method. This, again, supplements the enterprise deals we're doing. This is providing a home service. It's very small numbers, Michael, so nothing that will move the bar, and small amounts of revenue.
Good membership numbers, but small amounts of revenue so far. It will take some time to build that out. We will continue with it, and we think it's a service that will be in demand in the future. It can never make a lot of money because the margin is very small. It gets you more members that will drop in. Every home worker will be someone that will drop in and use an office from time to time, and that's what the objective is there.
That's clear. Thank you.
Thank you. A question now from James Redburn at Barclays. James, your line's open. Please go ahead.
Hi. Good morning. Yes. On the franchising business to start. Currently, the sub-franchising agreements seem to be on average for, I guess, a handful of centers each time. Should we think of this business being about a large number of partners, each with a few centers? Is there a, I guess, a scope to actually sign up some large partners or grow the existing ones here? I guess as a follow-up to that, would it be operationally, commercially more attractive to do that by supporting a smaller number of large partners as opposed to a large number of small partners? On the membership agreements. In terms of the uptake, can you talk about the mix there? I.e. what share revenues, meeting rooms versus office being booked versus co-working, respectively? Thank you.
First of all, yeah, interesting question on the franchises. I've been pleased to see in the past, I'm just trying to think when, but over the past three months, we've had, I think, two franchisees take another block of a geography. Typically, these deals are five centers or 10. I think we've done one for about 20. That's the biggest one so far. Someone that had taken five has taken another five, and I was encouraged by that, and I think there's another one that took a five plus a five. That's a sign that they're comfortable with the returns they're making. They want to invest more. Overall, the biggest franchise we're working on at the moment, I think we have, I have to check on this. Wayne Berger, if you could make a note, but we have got one that we've done in India.
I think that one's for 45, I'm not sure. We've got another one in Southeast Asia for another 40. It really depends on the geography, James, supporting. It's clearly, again, depends on geography. Much better to do 40 and concentrate the support for those openings in a particular geographic area than to do five at a time. Generally, the fives that we've done are in our existing geographies where we already have support. These larger ones tend to be on the edge of our geographies, and we need to add support in order to get them going. In coming to membership, it's very early days. People aren't having that many meetings, but they are using meeting rooms. Meeting room usage hasn't really picked up. It's getting better, but we're not really seeing that coming through as a significant improvement.
Again, I would expect that in the future, and we have been adding, even though meeting room usage today is low. We are adding inventory for the second half of the year because we can see signs of it getting more occupancy in this area. In terms of what they use, it's across the board. There's a lot of people taking offices. We can see them bringing people together for collaboration in meeting rooms all spaced out where they need more space. Just drop into our lounges and co-work area. It sits across the board. In revenue terms, slightly more office use than open space use. It's early stages. We've had members for a long time. These members are quite different in that it's not a few people from the company, it's the whole company, and that makes it quite a different mix.
We are tracking it as we go through this quarter.
Perfect. Thank you.
Lovely. Thank you. A question now from Daniel Cowan at HSBC. Daniel, your line's open. Please go ahead.
Thank you. Morning, guys. I've got two questions. One is around pricing. Please, Mark, you mentioned that in certain areas, you're able to judiciously start moving prices. Can you talk us a bit about how that's going for you? I guess how's competition, is that holding things back, or is it more to do with where you are in the recovery? Do we get back to pre-crisis pricing for centers on average? The second question is on the Master Franchise discussions that are ongoing. Can you give us an idea of maybe what % of the network or of revenues are currently under discussion, please?
Okay. Let me deal with the last one first, Daniel. Percentage of the network, we can't give you guidance on that. Again, it's early stages, even though we're in final stages on some of these. Till the deal is done, they're not done. We're making good progress. Discussions are ongoing. Again, it's all about finding the right partner. It's not about the sale itself. It's finding the right partner that can then expand and make sure we cover that geography. In terms of pricing. Now, during a crisis like this, what happens is there's a lot of pricing pressure, as you would expect. The few people that are out there looking, there's pricing pressure. We've been running in some markets with introductory offers, basically. It's the introductory offers that we have reined in since February.
During March, during April, again, statistically, we put the price up in more centers than we put down. That's, again, you can see an inflection point coming through. Our pricing is done automatically, so it's happening in real time. As we start to see conversion, so the pricing strengthens and so on. It's critical, we believe, not to get caught out with fast-returning demand. You don't want to tie in these discounts for too long. Which leads me to your second question. Again, will we get back to pre-crisis prices? The answer to that is unlikely, simply because we dramatically reduced our rents. Again, anticipating a world where rents in CBDs may be coming down. Therefore, it would be wrong to expect us to get back to the same level of price itself.
We would expect to get to the same level of margin and may be better, coming back to Andy's question earlier, maybe even better margin if we get higher levels of occupancy. In the end, it's price and occupancy that are at play here. We have lower cost base, slightly lower revenues because you have to reflect the market price and the prices we're charging. A high level of occupancy could help us move the margin up again, not for a while, but hopefully we'll see that coming through in 2022. What we believe is the demand will keep on opening up, and that's really the critical issue here. In time, where enough supply to be delivered into the market, and we want to be delivering as much as possible.
The whole market will have difficulty, we believe, in supplying to what will be growing demand as more and more companies look to adopt this new way of working.
Super. Thank you, Mark.
Lovely. Thank you. A question now from Calum Battersby of Berenberg. Calum, your line is open, so please go ahead.
Thank you. Morning, Mark. I just had one question, hoping to ask about the net debt move in Q1. Just looking at it, when you strip out the return of the investment from the end of last year, it looks like there was approximately a GBP 340 million cash outflow in the Q1 . Just hoping to understand if there are any one-offs in there or if that's what we should expect to see at the run rate now until occupancy significantly improves. Thank you.
On this, we always had the cash outflow in Q1. Be fair to say, it's exacerbated by the fact that we are closing off a lot of deals, or have closed them off in Q1. Part of the leverage that we have is that we are then paying the rent in order to achieve the deal. We get the benefit going forward, but we're paying the rent going backwards. There's a sort of delayed cash effect there. In terms of, we would not expect that same level of cash outflow going forward at all. Now going forward, we've got the benefits of cost savings and the benefits of an improving business.
I think, again, in Q1, you've got a number, you've got acquisitions, several of those that are also adding to the cash outflows and so on, and quite a bit of growth, even though they're capitalized, not capital free. It does take some working capital to get them moving and some investments to get them moving. That again, is the worst point as far as we can see at the moment, that Q1 .
Got it. Thank you, Mark.
Thank you. We'll now take a question from Sam Dindol of Stifel. Your line is open. Please go ahead.
Morning, Mark. A couple of questions from me. Firstly, on capital allocation. Obviously, I think you said GBP 30 odd million on M&A and property deals in the first half. Is there much more coming down the pipe on that? How do you see future M&A versus shareholder returns given the cash raised last year? Secondly, on franchising. Given WeWork would like to have some more investment from a SPAC, and it's targeting a bit more franchising there, do you think that will impact competition for franchises in general? Just interested in your thoughts around that. Thanks.
I'm hesitating because I'm writing it down. You haven't shocked me with that question, Sam. Capital allocation. Look, there is a lot going on, and there's a lot of things in play. It's hard for me to answer that question at the moment. I think we're looking at quite a lot of opportunities and looking at them cautiously. We have the capital. We are carefully weighing up this very question about, in the end, it's got to meet, it has to have a high quality of shareholder return for us to do it. What's easy to decide on and go ahead with is the capital light stuff. It's a little more difficult when you are doing M&A, which does require capital.
If you look at the deal we did, Sam, in the Q1 what's attractive to us is if we have a good market position, we can buy the number two. The synergies are very attractive. You've got to grit your teeth, for the initial period because it's, again, a tough market. We know that historically, this is a great market, and it's a market that if you look through and you say, where would we like to be in 2022? You would like to be there. It is a challenge for us to work through how we allocate capital in Q2 and beyond. Rest assured, we are considering it very carefully. We'll hopefully make the right decisions for shareholders. If we then look to the WeWork franchising sort of idea.
I mean, first of all, this talk of franchising. They haven't done any franchising yet. The deals that look like franchises are them basically getting out of loss-making businesses, but they're not really franchising. They're the opposite to that. Essentially, basically the WeWork model, if we look at what was reported last year, they lost GBP 3.2 billion on GBP 3.2 billion of revenue. That's not a business that franchisees would want to partner with because they're in business to actually make money, not burn it. I think, and the investment overall, yes, the SPACs investing, but you've got, what are they raising? GBP 1 billion or so. That's six months cash burn. It's not more than that. Again, we hope their eventual listing does very well, and it's going to create a fantastic comp for us.
When you peel everything to the side here, in the end, the company's still got gigantic quarterly cash losses. We await to see with interest whether they say Q4 that will break even, as they say, they will make a profit, albeit on an adjusted EBITDA basis. We think that's going to be very difficult. Again, we wish them the best, but we're not seeing it at the moment in terms of the franchise market. Okay, Sam?
Lovely. Thank you. Our next question is from Edward Donohue of One Investments. Edward, your line's open. Please go ahead.
Morning, gentlemen. Actually, most of mine have been answered, but I just have one sort of slightly bigger picture question. I'm trying to think, how does the discussion with, especially on the Master Franchise level, develop vis-à-vis the membership model growth? Does that change the dynamic of the discussion in the sense of, and maybe I've got this totally wrong, but I'm thinking that the older model would have had a more set level of revenue versus now you have a significant potential spot component. I'm just wondering, how you sort of align all those different dynamics.
It comes back to the question earlier. Basically, the occupancy, Steve Ward's opening question. The whole dynamic of the business will change. You will have your long-term occupancy, you will have your services, you will have people working from home that we're supporting, and you have a much more significant spot revenue, which is there and sits on top of the occupancy. That boosts the return to a franchise partner. That is, again, it makes it even more attractive to be part of a network because you're just not going to get that spot revenue if you decide to do it yourself or go to the smaller operators. They just cannot provide the coverage. It's a bit like Uber.
You could set up your own Uber, you're just not going to get the same feed you get from a leading brand with a leading platform with the demand flowing through. That is why franchisees and master franchises want to work with us and participate in a sort of investing in growing a particular geography. It's basic business. Return on capital was good before. It's likely to be better going forward because the market's come to us. That's what happened in 2020 and 2021, and it's still happening now. It's a more attractive environment than pre-pandemic.
Okay. Just with regard to the comments on Florida and Texas, what are you actually seeing? Are you back up to 2019 levels or are you still tracking below that? What is the service income doing in those particular states?
If you look at these states, I've just picked out those two states. The business picked up in California, a little slower in Europe. California is quite encouraging, but not to the same extent as Texas and Florida. The change in geography in the U.S., a lot more people have decided that they can work from Texas or Florida and are going there and are working. That's helped in the recovery. When I'm talking about sort of springbacks, it's that we're seeing quite strong recovery in those markets. We just hope then that sort of covers more markets, and we start to see that in more places. If you look at Florida, there is essentially, it's more or less business as usual in Florida and in Texas. As it gets back to that, then things start moving again.
You get back to business as usual. Plus, you've got a lot of people move from the north to the south, because of basically lower cost of living, lower taxes, better weather, and you can do your job from Florida. You don't have to be in Connecticut and commuting into New York City and so on. Again, you will see more and more of the geography changing of where people work, because of the effects of the use of technology during the pandemic. We would think that the southern states in America would continue to benefit from this continuing migration of companies and people who work for companies.
Okay. My last question, if you don't mind, is just looking at your comment with regard to the EBITDA for the Q1 . Rolling forward for the rest of the year, do you think it is realistic to actually see a positive EBIT for this year? Consensus seems to be tracking around about GBP 30-odd million. Do you think that is realistic on the visibility you've got at the moment, the cost saving phasing? Do you think one should take a more cautious view with that, but then the inflection for 2022?
We're not, as we've said many times, it's moving too quickly for us to give any reasonable guidance. We'd rather not give any guidance apart from we've said that we expect things to get back to full power, if you like, by the middle of 2022. We expect, and you can see it in our statement here mentioned several times, we're cautiously optimistic. We don't want to call it too early. We're seeing excellent signs. You can see that also in the statement, that when things come back, they could come back quite well. It's just too early to say. Remember, we're still right in the eye of the storm.
Fair. Thank you very much indeed.
Okay, ladies and gentlemen, that concludes questions on today's call. I would now like to pass the call back to Mark for any closing comments.
Well, thank you all very much for your questions and for joining us this morning. As always, if there's any follow-ups required, Glyn, Wayne, and myself will be available for the rest of the day for any other inquiries. Thank you all very much and goodbye.
Thank you, everybody. You may now disconnect your lines.