Morning. I'm Lucy Sharma, Investor Relations of Electrocomponents, and I'm joined by Lindsley Ruth, our CEO, and David Egan, our CFO. Thank you for joining this call. We have announced this morning two acquisitions, Synovos and Needlers, and a proposed placing of GBP 180 million of our ordinary shares, about 5% of our share capital. We have released announcements and a short set of presentation slides this morning, which are on our website. Lindsley and David are going to use the presentation as a base to give you an overview of what we have announced, and then we'll open up for Q&As. Thank you. Lindsley, over to you.
All right. Thank you very much, Lucy. A happy very early morning to all of you. I am joining today from the U.S. David is joining us from the U.K. Firstly, most importantly, I hope everyone is keeping well and healthy. Health and safety remain the number one priority for us as a company, internally as well as externally. Today, we are accelerating our growth strategy given our strong foundations. I think if we look at the pandemic, we have seen an opportunity for customers and suppliers to be fast-tracked towards our proposition. Overall, I think that the business has performed quite well during the pandemic as we were well prepared heading into it, and I think we'll emerge stronger as we come out of it. We've certainly taken share and outperformed the market.
The momentum has continued into the second half of this fiscal year, despite the uncertain backdrop that we see. We're streamlining the group, as we talked about during the interim, to become leaner, more agile, and accelerating our growth strategy through our RISE initiative, which is overlaid on our Destination 2025 target or five-year plan of a mid-teens operating margin. The two really go in conjunction with one another to help us move from a position of strength to a further position of strength. We see the opportunity today really twofold. Number one is to go faster. We know we need to differentiate and stay ahead of our competition, and we need to do so at a much faster pace, so we need to have a sense of urgency in our business. We also need to take advantage of increasing organic and inorganic opportunities.
The one thing that's come out of the pandemic is that, and this tends to happen in supply-demand imbalances, is that we see an opportunity where supply chain continuity is again a priority within the supply chain, an opportunity where our reliability and our service gives us a competitive advantage. This is what we said our interims outline on slide four. We're focusing on our organic and inorganic investment in three priority areas, which are based on building the strengths of the group. They are in order of priority. Number one, value-added solutions. Two, product adjacencies and expansion. Three, geographic strength. Today, as we announce these two acquisitions, Synovos and Needlers, these tick these boxes and are right in our strategic sweet spot. These are digestible bolt-ons that we've looked at for quite some time. We know the businesses well.
We've been speaking to their management teams for a while, and we know we can drive revenue-generating opportunities as well as synergies as these businesses leverage our differentiated group model. These two acquisitions absolutely accelerate our ambition of becoming first choice for our stakeholders, our customers, our suppliers, our investors, society as part of our ESG strategy, and our employees. Firstly, Synovos, which we detail on pages six to eight of our presentation deck. Synovos is a very good, outstanding integrated supply business that's based in Pennsylvania in the United States. It's very similar to IESA, who we acquired two years ago. It's gone from strength to strength, winning new contracts during the lockdown, as well as expanding internationally.
Synovos manages customers' indirect procurement inventory and store management with assurity of supply and availability while reducing costs, which is a mirror image of what we do with IESA, again, the business we acquired in 2018. Synovos has over 80 blue-chip clients, predominantly, and then that's over GBP 500 million passthrough revenues, but predominantly in the more resilient industry verticals of pharmaceuticals, consumer health, chemicals, and food and beverage. They've got a proprietary technology platform similar to IESA's MyMRO, which delivers the cost and differentiation advantage as well. Having the combination of IESA and Synovos together means we can now offer integrated supply solutions to customers on an international basis. Customers in the Americas with Synovos gives us an enhanced platform to offer solutions in Europe, and vice versa with IESA in the Americas, and then together, longer term, we'll target Asia-Pacific.
Definitely the combination gives us a solution that our IESA customers have been asking for in the Americas for the last few years, actually. Synovos will strengthen our business in the Americas in three key ways. One, it allows us to introduce Synovos to our Allied Electronics & Automation customers in the Americas. Customers where we have deep relationships but have yet to have an integrated supply solution ourselves, it allows us to bring that to the customer. Two, it allows us to be able to expand our product offer within Allied Electronics & Automation by evaluating suppliers within the Synovos business model to understand if they're the right fit for us on the distribution side of the business. Three, it gives us the opportunity to offer our private label range, RS PRO, to Synovos' customers.
Similar to what we do with IESA, it gives us the opportunity to add a value brand into the equation. IESA and Synovos are definitely a significant acceleration in expanding our value-added solutions offer internationally, which as we refer to it and have in the past, our digital moat or e-commerce moat, if you will, in regards to value-added solutions, technical services, supplier relationships, and traceability. While Synovos will strengthen our business in the Americas as well and provide revenue generation opportunities and some moderate cost synergies, by the way. Moving on to Needlers, which we cover in slide nine. Needlers is a fantastic business in the U.K. that has high-quality products and solutions in the critical areas safety, hygiene, and Personal Protection Equipment, an area of the business which we've been tracking for a long time.
I think it's really important to note that we've been tracking this business before COVID-19 and the pandemic, and the COVID-19 certainly has brought an enhanced opportunity for PPE as a critical product category which I believe will last as we move forward. I don't think this is something that's a one-time deal because of the pandemic. Certainly, I think it's a highly attractive growth market, and we believe that prior to the pandemic, and believe it post. It's a very fragmented market as well. Needlers provides the expertise and a trusted brand name in this segment. Just to please note that we do have a small percentage of our business in this segment today, but this helps us to enhance it with a level of expertise that we don't have.
Also, there's a focus on the food and beverage sector that gives us a stronger sourcing capability with private label brands, which account for 40% of their sales. It's not just about the product offer. Needlers has actually a growing solutions offer as well, so technical expertise and consultancy, where they advise customers on how to address increasing safety and hygiene requirements and provide appropriate training, which again, I think is going to continue post the pandemic. Needlers and Electrocomponents' capabilities are highly complementary, and we see significant revenue potential possibilities in terms of synergies from utilizing our distribution networks around the world to overseas customers that we both have in the U.K. and internationally. All of our customers, for what it's worth, use personal protection equipment. Every B2B customer that we deal with has some sort of safety spend within their portfolio.
Our digital capabilities and experiences in developing private label brands globally will also present significant revenue synergies and value creation opportunities. At this point, I'll ask David to comment on the returns and equity placing.
Thank you, Lindsley. As Lindsley said, we are announcing the acquisition of two high-quality businesses today, both with strong prospects and both aligned to our growth strategy. We are confident that both acquisitions will deliver attractive returns. Further details of these are included on slide 10. Looking at Synovos, we expect Synovos to make strong contributions to group growth in 2021, including revenue generation opportunities and buying synergies from an expanded U.S. offer. Our return on investment is expected to be comfortably ahead of our group cost of capital by year three. For Needlers, we have adjusted the financial results to strip out the benefit from COVID this year and to give underlying sales and profitability. We see good cross-selling opportunities between Needlers and Electrocomponents. Expected return on investment to be comfortably ahead of the cost of capital in year one.
Both acquisitions are expected to generate operating margins in line with our group average in the first year and to be earnings accretive in the first full year of ownership. On the equity placing, which is on slide 11, we are looking to raise up to GBP 180 million, which is approximately 5% of our issued share capital. We plan to do this via an accelerated book build and a retail offer through PrimaryBid. The placing will allow us to do three things. Firstly, to fund the full GBP 150 million cash consideration for Synovos and Needlers. Second, to ensure we are not constrained in our organic growth strategy, such as funding working capital growth opportunities. Thirdly, to allow us to deliver on our disciplined acquisition strategy in a disciplined but agile and front-footed manner.
We have a strong pipeline of digestible bolt-on opportunities, and there is a very active market associated with those opportunities. On leverage, we expect pro forma net debt to EBITDA to stay below the 1 x at March 2021. We're confident that this is the right level of leverage for our business. It permits us to act on growth opportunities organically and inorganically, while continuing to manage our business during these uncertain times and the environment in which we operate. Organically, we continue to see great opportunity and want to be able to continue to invest in our growth strategy unconstrained, with working capital investments to fund opportunities and some modest capital investments. Regarding inorganic opportunities, slide 12 outlines our disciplined M&A prioritization plan. We're highly focused on opportunities within our sweet spot and our areas of expertise.
We have a pipeline of suitable opportunities, nearly 4x as many as we had two years ago, which meet our clear acquisition criteria of generating economic profit, plus being a strong strategic and cultural fit. Whilst we remain rigorous in our acquisition strategy and continue to walk away from those that don't meet our criteria, we are seeing increasing numbers of those that do, and we want to have the financial strength to continue adding bolt-on opportunities where we can generate value. With that, I want to hand you back to Lindsley.
Thank you very much, David. Just to conclude, we've spent the last five years working quite hard on building the basics in this business and getting the building blocks right and in place to be able to do acquisitions and to fix the house before we put additions onto it. Our momentum has continued to build in the second half with market share gains driven in particular by our private label, RS PRO value-added solutions and our omni-channel service proposition, which is really important to be able to offer customers what they want while adding value the way customers want to place orders, whether it's via the web or e-commerce or over the phone or via fax, whatever, we do it the way customers want, and our strong product availability and breadth.
Let's be clear, this doesn't just happen on its own, and we do remain cautious given the economic backdrop, and there are some COVID-related costs that are taking time to drop away. As I said, it doesn't happen on its own. The business is in great shape because we're not sitting here waiting for the market to get better or the economy to get better. We're seizing the opportunity and crisis to accelerate our growth. I think it starts with our leadership. I couldn't be more proud of the leadership team we have today, the investments we've made in developing our leaders. I think we've got great momentum internally with our morale and our engagement. I just want to be very clear, in terms of growth, our first priority will always be organic growth, and it has been and will remain organic growth.
We've got a high-quality pipeline of acquisition opportunities that will add significant value to the business and enhance our ability to drive organic growth now and into the future. Last statement, we're confident that we will take Electrocomponents to the next level, but it's one step at a time, not a giant leap, and we're very excited about the opportunities ahead. It's early in the morning here, but I certainly hope you are too. With that, operator, if we can open up to questions.
Our first question comes from Rory McKenzie of UBS. Rory, the line is yours.
Morning all. It's Rory here. Thanks for taking the questions. On Synovos, you've highlighted revenue synergies and the growth potential. Can you expand a bit more on some examples? Also, can you talk about your experience from IESA? You're now over two years into owning that business. Can you disclose what that has delivered in terms of growth and cross-sell and where that is versus your maybe budget at the time? Secondly, again, on Synovos, I remember IESA was, I think, a 25%-30% operating margin business when you acquired it, ignoring the passthrough revenues. What's the difference with Synovos being a mid-teens EBITDA margin? Do you expect this business to be strongly margin accretive to your group over time? They're those two firstlies.
Good morning, Rory. Let me take the first part. Dave will take the second part. In regards to your first question, I would say that there's not a significant overlap between the two in terms of customers. There is some overlap. We have identified the overlap in those customers. One of the first things we started working on almost two months ago was the go-to-market strategy without discussing specific customers. How would we go- to- market together between the two leaders of the businesses in the Americas and Europe where we could cross-sell? There's a significant opportunity between the companies to follow customers in the Americas to Europe. I will say, though, however, Synovos has had a presence in Europe, so they do have people in Europe today, albeit small, whereas IESA does not have a strong presence in the Americas.
Both guys will leverage the supply chain and their proprietary platforms to accelerate revenue opportunities between both companies. We have seen a shortening of that development cycle through the pandemic. What might normally take 18 months from presentation to close and implementation of the beta site, in many cases, is down to six months because of discontinuity of supply within the supply chain, smaller companies that weren't able to support customers in this virtual world that we now exist in. That's one. Two, based on our experience with IESA, we have found a good lead generation arm with the RS side of the business. In Europe, we tend to focus a bit more on small- to- medium enterprises versus the Americans, where we have a greater presence with larger customers and the volume and production environment.
I would expect that Allied Electronics & Automation would have electronics and automation in the Americas, would have more opportunities as a funnel and lead generator to provide into the Synovos model. Three, we have launched what's called RS Plus in Europe. It's in more of a beta mode, but it's an IESA light version to be able to go to more medium- to- smaller customers that wouldn't necessarily require a storage management solution, that RS can provide a solution in conjunction with IESA. We'll do something very similar in the Americas with Allied Electronics & Automation in the future. Great synergies in terms of revenue. Opportunity to expand our private label offering via Synovos as well into Synovos' targeted customers. We're excited about the opportunities, and I'll be there first thing tomorrow morning at their headquarters in Radnor, Pennsylvania. On the second part, I'll give that to-
Sure. Morning, Rory. IESA, currently, their charging model is more of a management fee and also then a supplier charge. With Synovos, they have a couple of additional charging mechanisms, and so the consequence is a little bit more sort of gross revenue reported. The margins on the same like-for-like management fee are very similar. It's more just the way we account for it. As we look forward, we certainly expect the operating margin to be moving further to the right-hand side for Synovos. I think bear in mind, similar to IESA, there are benefits that are not necessarily going to be reported through the IESA/Synovos numbers. They will sit within the core business, whether that be RS PRO as a synergy, whether that be product going through the Allied Electronics & Automation channels.
That will be synergy benefits being reported in other parts of the group, not necessarily attributable to the acquisition.
Okay. Thank you. Just one follow-up. Could you still comment on how IESA has grown over the past two years?
Yeah.
Yeah.
Yeah. IESA has been, in the last 6 to 12 months, an acceleration of the funnel. They've grown, as we expected them to do. They've done well. We haven't put the numbers out and quantified in the market because we rolled that into European numbers, and we've intentionally done that. The funnel and the new contract wins are at an all-time high. I can say that, and it's very similar with Synovos in terms of their funnel as well and our funnel now. We're really excited about the opportunity between the organizations. Combined, it's more than $1 billion in passthrough revenue. That's a pretty valuable venture when you get into a global integrated supply organization, and it gives us scale to be able to accelerate that growth on a global basis.
Especially, one important, probably the most important thing on this space is customers talking to customers. We've got, on both sides, phenomenal blue-chip clients, from pharmaceuticals to food and beverage to industrials, and I think it's really exciting when they talk to each other, they share information because for a customer, you just can't shut lines down. They're not threatened by talking to competitors in many cases and giving testimonials, and it really helps us in that case. The stickiness factor in this case is pretty significant, Rory. Once you're in, you're in, and you simply continue to provide reliable, great service for and build off an ownership solution.
Yeah, I think the only thing I'd add to that, Rory, just two quick things. One is, IESA's got a good broad range of customers, as does Sanofi. Through COVID, over the last 12 months or so, they've had a few safe customers that have been down. They've seen some customers have just continued on, but they've also seen strength of existing customers. The other one is pipeline, very strong conversion is good. Just one example is IESA have just won a European-based pharmaceutical company, Sanofi. Once that's ramped up, that's a EUR 50 million contract. Again, the signs of the opportunities are there, the pipeline's there, and we see no reason why that will not be replicated in Synovos.
Great. Thank you. One final one, just on the leverage target. You mentioned targeting net debt EBITDA below 1x. Is that a new kind of formal midterm condition you have to stay below? Or is that just literally in the short term while you've got all these opportunities? Thank you.
Sure. I wouldn't say it's a target per se. What we've said is that the leverage for us will stay below the 1x. We've been below the 1x for a little while now. Having leverage down below the 1x sort of gives us absolute flexibility to continue to invest in the business organically as we see that top- line growth, while still maintaining strong
Disciplines around working capital, but equally just gives us that flexibility for the inorganic where we can complement that and accelerate the organic growth. For us, it's at a point in time, it's based on the opportunities as we see them going forward. We're not going to do anything silly with the balance sheet. We want to have a strong balance sheet, but if we want to be agile and flexible such that we can take advantage of the opportunities as they arise.
Okay, great. That's everything for me. Thank you.
Our next question comes from David Brockton of Numis. David, please go ahead. David, the line is yours.
Hello, can you hear me?
Yes, your line is open.
Oh, great morning. Two questions, please. First, certainly in relation to Needlers. It looks like you haven't sort of priced in the COVID benefit that business would have seen through this pandemic. I just wondered whether you can quantify how much of a benefit the business has seen, because that could clearly continue in the near term. The second question, these transactions feel more about just strengthening the business and generating revenue synergies as much as anything else. I just wondered whether you could touch on or quantify any of the cost savings that you could expect to achieve. Thanks.
Yeah. Let me touch on the first one, David. Good morning, by the way. Our strategy is very much about enhancing our capabilities inorganically to accelerate organic growth. The number one priority within the business is accelerating profitable organic growth. These two acquisitions give us the capability to do that, to move faster and to take advantage of organic opportunities via inorganic acquisitions. There are moderate cost synergies that we haven't disclosed at this point. We obviously want to get through the acquisitions and then work with both Needlers as well as Synovos to work through those synergies over time. The primary focus, these are both two good businesses. If you remember, these are not distressed businesses. These are two good businesses that we want to enhance, and we want to take to the next level and make great businesses.
On the first part of your question, I'll flip back to David for the COVID benefits. You're on mute, David.
I'm sorry. Yes. For the COVID benefits, we went through customer by customer, and we removed all of those benefits, both in terms of revenue and profit. Those benefits or some of those benefits may continue into the future. We look at that as pure upside going forward. There certainly was one-off or enhanced purchases, we stripped it all out. As I said, if it continues, that's upside for us.
Are you able to say whether it sort of mirrors what we've seen with, I guess, some of the other listed distributors in terms of their benefit, where they're seeing sort of PPE up sort of 30% year-on-year?
Yeah, pretty close.
Okay. Thank you.
Our next question comes from Kean Marden of Jefferies. Kean, please go ahead.
Morning all. I've got a few questions. On Needlers as well. How do you intend to operate the business? Because I think your spare capacity in the U.K. isn't substantial, but you may have certainly out in the U.S. at the moment. Are you going to drop the stock into your front end and back end, or is this going to run on a slightly more standalone basis? A quick question on the Needlers financials. I think for your sort of undisturbed, your pre-COVID-19 revenue guidance is about GBP 40 million, I think for the December 2020 year. I think you've talked about an EBIT margin in year one close to the group average, just about 10%-11%. If I look at the company's house filings, Needlers had about GBP 31 million of revenue in the December 2019 year.
It looks like even on a pre-COVID basis, the revenue seems to have stepped up by about 1/3 , which looks quite substantial. The EBIT margin, excuse me, for the last couple of years has been more like 4%-5%. If you can help us bridge from that sort of level, which I appreciate has got different accounting policies, to sort of the low- teens number that you're talking about. I've got one follow-up, but I'll stop there rather than giving you a big list.
Good morning, Kean. Let me start with your first question. Our plan is this will be reported into our European press, not into the U.K. We obviously, safety business standards, Needlers is BRC registered, British Retail Consortium. We have that and the food industry standard. For food and beverage, they've got a focus in that area. There are various nuances across countries in terms of safety requirements and regulations that impact the product. We do have some suppliers in common. Number one, we see this again as a revenue and margin synergy opportunity first. There could be moderate cost synergies that will work over time, but our real focus is taking advantage of the product portfolio, that technical expertise and value-added consultancy they have, which is key and leading in this category.
You've got to go out with a solution first. Customers are looking for safety and quality over cost. Then bring the products in second. That gives us a huge advantage. We obviously want to take this across Europe as well as international, given 40% of their business is private label. We've looked at in the Americas and Asia- Pacific which products and things we can sell and move. We'll do our best to quickly move the products into the overall Electrocomponents system from a data standpoint. Then begin to sell that. That's priority one. Let's not forget the private label and biometric solutions consultancy arm that they have will add significant value to our overall strategy and enhance our capabilities. There will be some moderate cost synergies over time.
I would say that we do have quite a bit of bandwidth still in the U.K. We've really been building out our strengths in terms of capabilities and people. The biggest enabler for us moving forward is [PIP of it] . We spent a lot of time investing over the last six to nine months in the virtual world at developing the leadership within the team. Anyhow, on your second question, I'll flip that to David.
Yeah, sure, Kean. Yes, they've seen a step-up in revenue. We were looking at this business pre-COVID-19, so we were looking at it last year. They secured new customers during the course of last year, which have annualized during 2020. This is a step-up in revenue for that annualization, and it all comes from their pipeline. As they say, as they look forward from where we are today into the future pipeline, it also looks very strong. In terms of the EBIT margin, it was a multi-country owned business, and there were quite substantial family costs sitting in the numbers.
Yeah. 100%. Okay.
Yes.
Before you move forward, let me just add for everyone on the call that both leaders of Synovos as well as Needlers will be staying with the business. The Managing Directors that Alistair Needler brought in, Mark Day, will stay with the business, as well as Carlos Tellez. Very impressed with both individuals. We've got them for a number of years, incentivized, locked in. I hope they're listening. We have great expectations in working together. Mark Day will play a critical role for us in this category on an international basis, although he will report in to the President of Europe.
Right. One follow-up. You referenced quite an active M&A pipeline at the moment. Personally, I suppose I'm slightly surprised that the acquisition wasn't more sort of businesses in the U.S. today. I think Needlers is not a surprise strategically, but maybe not in the geographical region that I expected. When you look at that pipeline that you have at the moment, is it more skewed towards U.S. opportunities where, obviously with the U.S. distribution center expanding over the summer, you've got considerable spare capacity to utilize?
Yes. I wouldn't say they're skewed to the U.S., Kean, because we're building a funnel of opportunities around the world and a pipeline around the world. However, since obviously I'm sitting in the U.S. at the moment, and hopefully will be back in London soon, depending on the vaccines, et cetera. I've been building relationships virtually with CEOs across the Americas that are in our strategic sweet spot that we're looking at right now. I would say yes, it's inevitable at some point we'll do more in the Americas because of exactly what you said. We have expanded the warehouse in the Americas. We have the opportunity to significantly expand the product portfolio. I will comment, however, that the broadest range in our group is in the United Kingdom.
We have almost three X the number of products, the number of categories in the U.K. as we do in the United States. We already had a pretty substantial personal protection equipment, safety and hygiene product portfolio in the U.K. That's why it makes sense for us to do this there, because it's easier for us to bring the products in, and we've got close to 180,000 B2B customers in the United Kingdom. It's a natural fit for what customers already buy. As I said earlier that every customer has some sort of safety product spend. We see this as significantly revenue-enhancing for Needlers with our U.K. customer base. We are building a very healthy pipeline in the United States , to your point, and the Americas overall.
Thank you. That's good. Thanks for your time.
Thanks, Kean.
Our next question comes from Henry Carver of Peel Hunt. Henry, please go ahead.
Thanks. Good morning, guys. Just one from me. In terms of, you talked about you've been tracking Needlers since before COVID. For both of them, can you just give a quick idea of how long you have been sort of in conversation with them and also how they came about? Were they up for sale? Did they approach you? Did you approach them? Did you win in a competitive environment or, yeah, basically how the deal came about? Thanks.
Good morning, Henry. Yeah, for Needlers, we've known them for a number of years. The owner, family-owned, decided that his kids didn't want to sort of take it on. He decided to create an exit strategy. We were engaged with him exclusive for the last couple of years. He appointed Mark Day CEO. We've engaged with them all along in an exclusive arrangement. It's a clean deal, there's no earn-out. Mark Day will continue with the business, as will the management team. In terms of Synovos, private- equity- owned or private equity and investor sponsor-backed. A well-supported business. We're not sort of worried about the undercapitalization or anything like that. They're well- supported and a very strong management team. We began, or I sort of created the first interaction with them a few years ago
Lindsley met with the CEO earlier this year, and then we've been building that relationship and rapport. We were their preferred bidder, but it was an auction, and we've been at the front of the queue for a variety of reasons, as a consequence and being able to get it into exclusivity and across the line.
That's great. Thanks, David.
Our next question comes from Daniel Hobden of Credit Suisse.
Good morning all. Hope everyone's well. Just two left from me, if I may, both around Needlers. I was wondering if there's anything you could say around customer concentration in that business. The second question is, being in the U.K. and being Brexit, which seems to be in the news all the time, I was wondering where do Needlers source their products from, and maybe if you could say something around their supply chain, that'd be helpful as well.
Sure. Sorry, I'm struggling going in and out of mute. In terms of customer concentration, no, not significant. Quite broad. Although Needlers is a little bit more focused on the food activities. It is transferable into other segments of the product range that they have. In terms of their supply chain, they do procure from multiple sources around the world. They do procure from Asia, but they also then procure from across Europe. They have strong relationships, they have strong supply chains, and they've been very good through COVID. Their whole sort of business continuity has been very strong for them.
Cool. Thank you.
Again, for any further questions, that's star followed by one on your telephone keypad. We have no further questions on the phone line, so I'll hand back.
Okay. Thank you very much, Jordan. Thank you everyone for taking the time at short notice to be on the call this morning. As always, if you have any further questions, you can direct them to Lucy. We're always available for you. We thank you for your continued support and for those investors that are reading or listening today, thank you very much for your support of our company and our business, and we look forward to working with you closely now and in the future. Happy holidays to everyone. We hope you and wish you the most healthiest and happiest and safe holiday season. Thank you, Jordan, and thank you everyone. Bye for now.