Earnings Call: Q2 2020

Jul 17, 2020

Thank you. And welcome to the presentation of our Q2 report. For Adnor Group. With me, I also have our CFO, Lata Yoderid, who will be doing part of the presentation. I know it's a busy day for most of you and a lot of companies reporting. So let's get to it. If we start the presentation and move to the next slide, and go straight to the slide called strategy for profitable growth. I just want to give you quick update on the annual strategy where we are. We are basically doing the same thing that we have been doing the last 10 years. We have a acquisition driven growth strategy. Meaning that we do normalize acquisitions a year and, we support our companies with organic growth we believe in the decentralized strategy, a lot of decision power closed our customers, we support our companies, and we find synergies and collaboration where possible. This strategy has taken us from a net sales of SEK1 1,000,000,000 in 2009 going to almost SEK 4,000,000,000 in net sales before COVID 19 here in 2019, and we have been able to improve our margins as well. And if we move to the next slide describing our 3 divisions called software and digital solutions in 3 divisions, We are doing our operations and free divisions, design and product life cycle management and process. The design, it's, basically, we serve the needs of those who need to design, build, and manage. And we do that both for the construction and facility management and also for the manufacturing side. We do that in 3 different companies. And here we are, a partner to Autodesk, and we also have our own developed software in the company's symmetry in trivia, source offerings. And if we move to the PLM division, we are the world leading partner to the French company that's all providing software and services with the need for digitalization. And we are doing that on a more global basis. If you go to the 3rd division process, this is directed to the public sector in Sweden predominantly providing software and services for the need of local and central government. With that, I mean, as an introduction to animal group, we'll move to the next slide because it's not safe describing where we are at. And most of you are following us now that we are predominantly operating in the northern part of Europe. We have been growing in UK predominantly the last year and, but we serve customers on a global basis. So with that introduction, I would like to move to the next slide with agenda for today. Not and I will be covering a summary of Q2. Talk a few seconds about the acquisitions we have done in the quarter. And then move on to our group performance and then we'll finish up with the financial position. So going into Q2 2020 on next slide, Slide 7. The second quarter was dominated by the COVID-nineteen pandemic. But our 3 divisions were impacted to various degrees. We have a situation where the majority of our employees are working from home and with the help of video meetings and other digital tools we are continuing to work closely with our customers. I'm impressed and proud of our employees loyalty and capacity to keep the business going. What we see is that demand from the public sector in Sweden remains stable. And in the process management division, we have been awarded contracts from state agency, regions, municipalities, and later when we go to the figures, we will see that we have increased the profitability a lot. On the other hand, the COVID-nineteen pandemic has negatively impacted sales in the design management and PLM divisions. We have actively reduced operating costs during the quarter through furloughs, voluntary sale cuts, general cost cutting, we have delivered a strong result given the difficult market conditions. But to realize synergies and adapt organization in division PLM, we have, lost a cost cutting program there that will save cost for approximately SEK 50,000,000 to SEK 60,000,000 on a running basis. We'll come back later to that in the presentation. We've also done an acquisition in the quarter of a SARS company called NET Fabricator who will strengthen our offerings into the public sector in Sweden. Looking ahead already, we can see that the future, as you all know, is hard to predict, but we can also see the strength in our business model with a large share recurring revenue are stabilizing the business and our financials. So with that, as an sort of overall introduction to the quarter, I would like to hand over or sorry, before that, the acquisitions on the next slide, Q2 2020, We acquired a company this quarter called Net Publicator. It's a pure sauce company. Provide individual documented meeting management to public administration. We have been working closely with them the last couple of years, and they are already part of our offering. The company net sales is about 60,000,000, good profitability, the arrangement with owners is that we acquire 50 percent of the companies now, and then we will acquire the rest in installments the next coming 3 years. And it will be part of the ProS Management Division from 1st July. So with that, I would like to hand over to our CFO, Nota Yoderi, who will take it through the numbers for, the And I would like to start with an overview of the consolidated financial performance. In the second quarter, which was dominated by the COVID 19 pandemic and its effects, we saw a decrease in revenue of 2 percent, 646,000,000 compared to 664,000,000 quarter over quarter. The quiet growth of 11%, mainly pertain to Exciting in the UK, which was acquired earlier this year. The current adjusted organic growth was minus 12%. Both design management and PLM divisions face negative growth following lower usage of 3rd party licenses and services caused by the challenging market conditions. Process division, however, reported an organic growth of 3%. The demand for the division solutions remained good during the quarter. We are now trading at a yearly rate of CX3.8 billion in net revenue. EBITDA for the second quarter was SEK 56,000,000, which was 24% less than previous year. The EBITDA margin was pushed down to SEK 6 0.6%. Please note that the reported EBITDA includes costs associated with the reduction of the organization and cost structure in the product life stacking management division. Costs for conducting the measures are estimated to 1,000,000 in total, of which SEK 20,000,000 were recognized in the second quarter. Annual savings or estimates of about 1,000,000 to 1,000,000 with full effect from the first quarter 2021. The EBIT adjusted for this restructuring cost was CX76,000,000 and adjusted EBITDA margin of 9.0%. During the second quarter, personnel costs were reduced by SEK 29,000,000 through government support measures in several of the countries where we operate. The government tax initiatives relate mainly to short term follows and reduce social security costs. Next page, please. With regard to the net revenue distribution, recurring revenue constituted 66% of to revenue in the second quarter 2020. The base of recurring revenue has continued to grow over the years. As you on previously mentioned, the stable base of recurring revenue gives downside protection in terms of lower demand. Even though even though we saw total net revenue go down by 2%, recurring revenue increased in the second quarter by 3% to about 1,000,000. We have so far been able to keep the renewable rate on a stable level. Over to you, Johanake. Thank you, Laura. And with that, I would like to dive in a little bit more through the different divisions, starting off with division design, man, on Slide 11. Looking at design managed net sales increase with 13% in Q2, organic growth was still negative, meaning that we had a, impact of the acquisition of Exiting in the 1st quarter. The optical currency effect organic growth was minus 13%. We could see a clear downfall in the net sales due to the COVID pandemic in this division, which was mainly reflected in lower news sales of Autodesk Solutions. However, recurring revenue show continuous stability with the renewal rate at the same level as before the onslaught of the pandemic. The division is offering based on prepared software surrounding beam and collaboration portal for the construction and the infrastructure sector as well as property management showed continued favorable development. The EBITDA was 1,000,000 compared to 1,000,000 last year, gave an EBITDA margin of 9.5% compared to 10.4%. Personnel costs were reduced for short term furloughs, lower secure, social security taxes and voluntary seller cuts and had a good impact on the operating profit. Even though new sales were slow, we landed some new customers, for example, a facility management system to regain the Evlevore in Sweden, and design system and competence sharing systems to transport for London, for example. We also customized them for our interactive source product portal for construction infrastructure projects when exceeded 50,000 users during the second quarter. So overall, the net sales down as expected as we sort of guided in the last quarter, but we have been very successful hard work of the team in a division to mitigate that on the cost side. Moving on to the PLM division on the next slide. Net sales decreased to SEK267 1,000,000 during the second quarter. We had a negative growth of 20%. Meaning that here, we were more effective on net sales than design. EBITDA was negative and 9,000,000, but as lost I mentioned before, in those 9,000,000, you will find 20,000,000 related to restructuring costs. Before we go into more in detail why we are doing the restructuring, I would like to mention that the market in the Nordic was of the organization in Nordic was quite stable, and we were doing some good business, with relation to where we are in the market with the pandemic. But it was tougher market conditions in Germany and UK. We have been able to learn some new things as well on the free to experience platform in Germany, for example, to a company called Kritsler, providing tools for spinning and the cotton industry So there are possibility to do business even though it's tough. With regards to the restructuring to give you some background on that, between the years 20,021,019, this division has grown by an average of 37% 37 has been achieved both organically and for acquisition. This is taken after the position as a world leading partner to the solar system with our own unique add on products and services. To realize synergies and adapt organization and operating cost to lower volume, several measures have been taken during the quarter that will reduce the costs on a yearly basis with around 50,000,000 to 60,000,000. From the first with full effect from the first quarter in 2021, but we will gradually see that during this year. Doing that means that we will take cost in this quarter $20,000,000 to realize it and $15,000,000 is is expected in the 3rd quarter, totaling to 1,000,000. So we And with that, I would like to on to the move on to the next division. Division Process Management on the next slide. We'll have to see that we have an organic growth here. We, as you all know, we've been following us, we are saying that we are able to do 2% to 3% organic growth in this division. It's a good statement, and we have been able to do that. What is most satisfying is that we've been able to increase the productivity in the organization significantly moving the operating EBITDA margin from 11% to 18% compared to last year. Here, we also have some impact from the reduction of personal cost due to state efforts but the majority of the efficiency improvement in the quarter is related to our own doing. The demand for the division solutions has been good during the quarter and we have won several tenders For example, for a new case management system for the Swedish National Board of House And Building And Planning. We have also won several tenders for the more local government in Sweden with regard case management system. And part of that has been with the Net Publicator offering that we described earlier as an acquisition. So here we have and had a good operation in the Q2, and it seems that we will be able to follow that through during the year. So with that, I would like to hand over to our CFO, again, who will guide you through the cash flow in the quarter. Thank you, Johan. We usually start the year with a strong first quarter in terms of cash generation from operating activities. This is attributable to our business model with a large share of advanced payments for maintenance contracts in the beginning of the year. This year, we continued the good cash generation, also in the second quarter. Cash flow from operating activities was at CHF688,000,000, more than CHF 200,000,000 above previous year. Intensified work, the cash and procedures and temporarily improved payment terms from certain suppliers and customers have had a positive effect on cash flow in the quarter. When you go to cash flow from financing activities activities, it was also positive. No dividend 29 was paid to the shareholders, as decided by the AGM, in May, and we made no debt to payments during the quarter. Next slide, please. We are operating at this uncertain environment supported by a strong balance sheet we have a we have a solid financial position. As just mentioned, we had a very strong operating cash flow during the 1st 6 months of 2020. This means that we, by the end of June 2020, had a cash position of CX675,000,000. This is almost CHF 500,000,000 more than in June previous year. In addition to that, we have undutilized credit facilities of another CHF 400,000,000 The equity ratio was 40% and net debt amounted to say 1,000,000. Other large changes in the balance sheet items mainly refers to the acquisitions of Axitik and UNocyte in January this year. Over to you, Johan. Thank you, Laura. And with that introduction to the 2nd quarter, we would like to open up for Q and A and questions, and we are happy to, answer any questions from you. Thank Our first question comes from the line of Daniel Turfmann from ABG. Please go ahead. Your line is now open. Yes. Perfect. Thank you very much. I start off with two questions regarding the cost program in PLM. What practically is it targeting and where is tilt a geographically. That's the first one. And then second one, following on that, in terms of the potential EBITDA margin beyond 2021, is it possible to reach a margin that is higher than we haven't seen historically for the business unit? Thank you. With regards to the cost structure problem, I understand practically where where it's targeting, our main cost is personnel. That means that the majority of the construction program is with regards to reducing the number of staff. That's what will happen during this year. And there will be some, and with that, it will follow some cost for offices that will, of course, will be reduced, but that will be an effect of being less people delivering the services to our customers. And if you look at Geographically, we have in the last quarter, reports, talked about that there are some things happening in Germany. So it was there are in Germany, and, the rest of the program is sort of sort of evenly spread through the division, but there's a majority of the program that will happen in Germany. And if we talk about margin wise, we still believe that we can do better that we are doing, and that's one of the reason why we're doing this cost restructuring program. So there are room for efficiency. Okay. Even if we compare it to a good year as we saw in 20 19, I think you had the highest margin of slightly above 9%. So it should have the potential to be better than that going forward. We are aiming for that. And that also, but it also has to do with with regards as we have an acquisition agreement strategy. Sometimes we acquire company that have, a a lower margin, and then we aim to drive that up. So sort of then fundamentally, yes, we should be able to do better. But sometimes we hurt ourselves, matter of speaking, by acquiring companies that has a lower operating margin, and then we try to drive that up. So but, fundamentally, yes, I'm not satisfied with, we are not doing better. Excellent. And then another one on the government and support of 29,000,000 in the quarter. Could you split that up per business unit, if possible? And also what's your forecast for supports in Q3? We can't split it up Elliot, we we we're not the disclosure in exactly where it is, but but the only thing we can gather as we said, we had the net sales going down in division design and PLM. So you will find a there sort of follows the business, but we're not disclosing exactly. And with regards to where we're going forward, I think the projections, you will see a lot of we're not saying too much and say that we will see effect of it in Q3 as well, but then we'll pay it out going forward. Okay. But is it reasonable to expect anything close to 1,000,000 in Q3 as well? It will go down, but it will have an effect in the Q3. Okay. And that's good. And then I have a question on the recurring revenue. You said that the grew reported 3% year over year in Q2. What was the development organically? I guess it was a decline? If you have that figure? Would you say the 3% was that with the rep that's what we have reported out? Yes, reported recurring revenue growth year over year, 3% reported. So I was thinking of the organic development. It was probably down, but No. No. You're true in your assumptions. Yes. Because we will see it. It's it's definitely not an organic graph in it. No. That's true. Yeah. This quarter back. Okay. Okay. We'll leave it there. And then a final one, Autodesk, they held an Investor Day in June launching new financial targets where they reported a targeted 16% to 18% sales CAGR between 20202023. And given that you partly resell their products within design management, Is it too aggressive to expect the similar organic growth rate for that division and that business unit for the next 3 to 5 years anything else that moves that picture from what output, as you say? You mentioned that data as organic growth, the next come here should be like 23% or rather? 16% to 18% per year up until the 23%. No, we will not deliver into 18% organic growth the next coming years in that business. And is it anything that makes you deliver something lower than Autodesk because you are still selling their products? Is it because you have more own products? You have other services around it, etcetera, that are developing a bit slower? Or how should we be thinking? We have more services in our businesses, and we are probably in a more mature part of the world representing for them they are Autodesk are on worldwide operation. Probably means that they have been part of the business in the world that probably has a high growth rate as well. So I think probably a mix of land, if I'm sort of guessing. But we are not planning for that high organic growth in this business. Perfect. I'll stop there. Thank you very much. Our next question comes from the line of John Hiltner from Intefunda. Please go ahead. Your line is open. Hi. So my first question is on on the organic sales draw. Can you say a little bit more about it? Is it from, less new licenses so that it's not as many new customers coming in or did you see lower revenues from, your customers perhaps delaying off people. So so, less, licenses due to less customers in that sense or leave it you see a lot of existing customers leaving you? Or could you just explain a little bit more where the drop came from? Thanks for that question. And it mainly relates to the businesses when we are talking about in design and the PLM business. I mean, no, we don't just first answer your last question. We can't see that we are losing customers What happening now is that the customers are hesitant to do new investment due to the uncertainty. So Things take longer. They are waiting. So they are not starting new projects by themselves. So the services are affected. And also, as, as you mentioned, I think, a lot of redundancies are customers. They are looking at cost. It means that they are not investing in new licenses. They are rather utilizing the license pool that they have in a better manner, but we can't see that we are losing customers to others in the market. That's very important. But the, sort of, the activities from our customers are lower, and that is hurting both new sales licenses and services for new projects. The projects that are sort of are already in motion they are continuing. So they it's not a hard shutdown of that, but at the same time, if you have customers in the automotive industries are not running their plans right now, then that means that this quarter, they are not focusing on buying new licenses. And, given that the trend in, you you mentioned the water was seems to be still under pressure than the other industries are picking up. Can you mention anything about the the the trend during the quarter if you saw pickup in June, versus May, perhaps Oh, I think sort of the, I can't really say that we have seen any pickup in the figure so to speak month to month. It's more of, the mindset of people realizing that, oh, it's probably not going to be as bad as we thought in Q2 and Q3, but at the same time, we can see the trend that it's the sort of the in the market, we have a sort of belief that Q4 will be better as better than a major, sort of pickup there. It may take longer time, but the, sort of, the drop will not be that bad if you see where I'm coming at. Yeah. Yeah. Sort of. Then coming to your your cash flow, at a pretty big working capital, the working capital release in the quarter. Can you explain that a little bit more, please? Yes. Now, as I said, as I've said before, I mean, we have been, we have focused a lot on CTU that we get our invoices paid as soon as possible, of course. And I mean, we have We had a high new sales in, in the first quarter, where a lot of payments came in, in the, in the second quarter. And, we also got from some of our suppliers. We got, prolonged payment terms. That that we don't go all, on forever. So we probably see a a turn back on that in, in September. Also, some of the customers, especially in the public sector, they actually paid us before. The ecocytes were due. So, we have been very active in working on our cash flow in the second quarter. And then just, finally, if you look at your your margin and process management, It increased a lot, giving a rather stable top line trend. Is it mainly This is mainly due to, a lot of costs, being lower in this quarter due to less travel and What have you, or did you get follow, in this segment? So you, you'll reduce cost in that sense or You have a component on that, but most of the, it's a very efficient organization, meaning that we are able to deliver, more with our own people reducing sub consultants, and, and a better product management. And I think that's the main driver of the operating profit in the division this quarter compared to last year. And of course, we have some effect of, social costs as well, but that's sort of minor compared to our own operational efficiency. And operational efficiency is the fact that we are able to manage products better with our own people rather than sub consultants. And and this is a a setup that we will keep to going forward. So you should have that efficiency going forward as well. Yes. That's our ambition. And then to find the one on the cost savings, you you mentioned you talk about damages, the savings that you take out, is it overlap that you, you you've seen for the wine and been planning for that you now execute on? Yes. It has to do with that. For the last couple of years, we have been acquiring the number 1, the sole partner in Germany, UK, fanelux and several account risks. And now we are coming together to create one tech now. That's the brand in the division. And that means that we have synergies both on the administration on the cost side, sales organization and creating 1 company of that. Probably, it takes a little bit longer in our thing, but now it's mature to do that, and then we're really licensed. So it's in several areas. So it means that overlaps, yes, that we sort of need less, sort of, actually, so yes, it's over that, but it's in several areas. Good. Good. Thank you very much. Thank you. Our next question comes from the line of Eric Yolanda from SHB. Please go ahead. Your line is open. Presentation overview. So, first of all, regarding the cost structure and program that you have, now initiated And why is it done right now and why wasn't it done before? As you mentioned, it is mainly consulting business, meaning that if you lose top line yields or lose profits, you don't have a lot of synergy, Is it that these kind of people that didn't really do the projects that you think will be Devon for post COVID or why hasn't this happened earlier? Starting with that, as we described, I think we described it quite clearly in the Q4 and Q1 report saying that we were aiming for a higher growth as we started this year. So that's one of the reasons why we could the growth that we were hoping for were not materializing the market. And then we had made a bet to early on saying that we would see growth in the company. So we were sort of front loading the organization. That's one of the reason we need to do that. But having said that, I think the my order is that sometimes you have to find the right time to realize the synergies from having to grow, meaning that So you never know when's the right time. And then you had the one question, say, are there sort of a not just a cost restructuring program, rather that we can see that we will focus more on different, type of offering within the division going forward. That's part of it as well. We can see that we are moving from, some sort of old box and moving selling organization to more of a service and project organizations as part of that as well. So it's a little bit of all of the above, and you can always discuss the timing. But we felt that it was that was the right time to do it. Okay. So so it's actually I mean, getting these people laid off from organization doesn't really matter because you do not think that this offering that you have previously had, that these people were, doing will not be as large in demand as it has been historically? No, I think that's not fair to put it. No, no, I think there are some part of that, but that's not the reason for what it is. So we are not leaving So the peep the restructuring plan doesn't represent that we're leaving at the old offering. It's more of a saying that we were actually, as we mentioned in the Q4 and Q1 report, we had a, we were sort of frontloading organization for a growth in 2020. And we couldn't imagine that we would see the COVID pandemic. That's one of the reasons. And then we also had a, as we have been growing by the life 37% every year, the last 5 years. And we have done that through acquisitions. We could see that now it was time to realize the synergies that we can go from going from an Nordic organization to a German organization to UK organization, to the US and the global organization, and there are synergies, and we need to do that. So I wouldn't say that we are sort of leaving part of the offering behind us, it doesn't represent this cost reduction program. It more realizes the synergies that we can see within the organization going forward. That we are able to run a more efficient organization going forward. Okay. Yeah. That's very clear. My my second question is with regards or actually if you compare design management and PLM, I mean, at least my view of the design management division is that it's less cyclical than the PLM. And obviously, if we look at organic growth numbers, it was minus 13% in, design and minus 20% in TLM. But having that said, it was still a large minus number in design, and I know that you have an industry exposure there as well. Is it fair to say that the industry exposure within design management grew by minus 20% as well organically and the rest or positive growth than within the DMA segment that you're also talking about in the Q2 report. No. I wouldn't say that because you have to realize in the paper segment as well. Have a lot of the consulting companies as customers, and the technical consultants, for example, they are the one providing the design and the beam projects for the construction companies. So that means that they have been a little bit hesitant. For example, you will find customers like, in Sweden, they are called all of really called Svek or for example, and they're also being hesitant with regards to consultants, there has been a drop there as well in that sector in this quarter. Okay. Yeah. So so rather it is about this company stuff sent higher new people than they don't buy new software from U. S. Well, because organic growth in those companies was around 1, 2% especially in Kuwait coins and and Raiders and so on. But they are to say that everybody, this quarter, everybody is a little bit very hesitant to do new investments. You utilize the things that you have even better. You get focused on cost and, you don't order new things. Hopefully, they might start doing it after the summer, but just this quarter is heavily effective, but I think every board been telling every management in every company do mind the costs because we don't know what will happen in the coming months. So I think that's the fact that we see in our new sales of licenses and services. Oh, alright. Perfect. And then also, just just to follow-up on that one, how large percentage is industry exposure within this time management? Hopefully, I could give you that figure, but I recon to that because it depends on how you sort of split it because we have a lot of, what we probably would call AAC customers but they are at the same time a manufacturing company providing their products to the end market of the AAC market. So we can't really give any figures on that. But having said that, as you remember, there are 3 brands within the division. The division of Libya, the company, trivia and service was global with our own software. They are working with the construction and the facility management. The brand of Secretary, who are providing the ultimate solutions, they are the one working with both the manufacturing and the AAC market. And, we are predominantly in that should more tilted to the AAC market as we did the acquisition of X Sightek as they have a much stronger, sort of tilting towards ADC market. So if any, we have more of a exposure to the AAC market rather than the manufacturing markets. Okay. Great. And then my last question is, you have now taken out the 20,000,000 in restructuring costs in Q2 for PLM. Will the next 15,000,000 come in Q3 or later or when will it come? Q3. That's our what we are planning for. Okay. Great. Thank you very much both of you and have a fantastic summer. Thank you. Our next question is a follow-up question from the line of Daniel Tawson from ABG. Please go ahead. Your line is open. Yes. Thank you. So I have a question on the M and A contribution in Q2. If I'm right on numbers here, it looks like Exitedeck contributed with SEK 290,000,000 in Q1, although it didn't contribute in the full quarter, but now in Q2, it only contributed with SEK 90,000,000 Is that correct? Is it a seasonal pattern or is it just a very weak development for Xitec in this quarter? I think, 1st of all, they contributed fully from January 1st in Q1. So the figure that you're independent of the figure, it was fully, consolidated from January 1st. Yes. And Navi said that, Q1 was the strongest quarter in sales ever for EXITEC and Symmetry. So it was a very, very strong quarter in Q1. And then we moved to Q2. That was probably the one of the worst quarter. So we have a very significant change there. You're correct in that. But having said, so you and there's a seasonal pattern as well. That Q1 is always stronger has been historically and Q2 is weaker. So it's a little bit of all of the above. Okay. That's very helpful. So the comps are strong and the outcome is, lower in Q2. How does it look for the rest of the year? Q3, Q4, anything we should have in mind from last year? Normally what sort of the seasonal pattern, if you look in beyond before the COVID 19 is that Q1 for this part of the business is always stronger. And Q2 is a little bit weak due to because there's a lot of sales activities rather than sales being done. And then you can see sort of Q3 and Q be sort of a normal in Q4 a little bit stronger. So, and, this is a phase driven organization, and you can find that, the order this quarter, ends in January, the year ends in January, that means that q Q1 for the event ends in April and Q2 in July, etcetera. And, with American sales driven organization where the last month and the quarter is generated, generates on pushing the sales there. That's the explanation as well. Thank you. We have another follow-up question from the line of Jan Husna from Entafonte. Please go ahead. Your line is open. Thanks. And, sorry if you if you mentioned this, and I missed it. I'm sorry, but, but, Did you say anything about how much of the support you got from governments in terms of furlough or something else? In the quarter? Yes. The 29,000,000 in total. Okay, great. And how does that look going to the second half of this year, the have you ended programs? I know some are ending in June, at other companies. What's your plans? Some programs will continue into Q3. But not just in the second quarter. So there will be roughly the same effect in the 3rd quarter. As in the second? No. Lower lower k. Yeah. Lower k. Yes. Okay. Okay. Thanks. That's all. Thank you. Thank you. And as we have no more questions registered, I now hand back to our speakers for any closing comments. Yes. And we have a question sent in by email here from Credit Newsnet Redeye. The EBITDA margin in design management decreased by only 1 percentage point despite minus 13 inorganic growth. And excite tech with lower margins, drawing in the numbers. Is it mainly due to support measures, or is there also a mix effect? Or something else? No. I think the main reason why we're able to sort of uphold the result with, even though the net sales drops in Italy is that we were quick with, actions meaning that where there are a lot of people in furlough, there are a lot of people, voluntarily and doing, giving up some salaries and, those types of cost cutting measures. That's sort of the effect that we can see in the business where we are sort of able to uphold the EBITDA margin So I think it's a lot of quick and action and response from the different management teams in the divisions that were able that made us, being able to uphold the EBITDA margin, even though the net sales dropped. And the second question is, rest due to EBITDA margin process management since 2013. Could you give some quantification of the effect from the support measures? I think part of that we answered previously saying that The majority of the efficiency in the Q2 and process management is related to our own measures We do have some, a couple of millions of that is support measures, but the overall priority is actually that we are doing the business quite much better. And as I mentioned, with regard to less sub consultants that drive in the margin cost efficient measures. Of course, there are some with regards to not traveling as much, but the majority is operating efficiency. Thank you. Further mailed questions. So if there are no more questions, I would like to thank you for taking the time to listen in and ask a lot of good questions to us. Any more questions, or should we stop there? There are no more questions registered over the audio.