Earnings Call: Q4 2020

Feb 25, 2021

I'm maybe I should start saying some words about the new appointment of Christophe as being the new CEO. He's not responsible for the last quarter result. I think I'm much more responsible for that one than he is. But regardless, I'm extremely happy that he has accepted the appointment. And I have got to know him during the last 3, 4, 5 months. And I think he's very well equipped and at a very good background, both as being CECL, but also being very active and with an international background in real estate, which is exactly what we need and what we would like to have moving forward. We have also had the opportunity to discuss the future strategies of Corteva, which I think to be aligned on that one is the key issue. And I think that has been part of the problem historically that we have not really had a clear strategy on how we believe we could create values for our shareholders over time. And I think that's really what we have spent time on. And also, Christophe, to get to know the organization and the pros and cons in the various operations and they are very diversified or they disperse whatever the word is, but they are different at least. And they also have different business models, which we have to not necessarily in line with each other, but we have to adapt to it and we have to maneuver in a certain way. And I think we are very aligned on the future strategy. And it has been a great advantage for both of us, I think, to have this kind of discussion. At the same time as we are making some kind of, I wouldn't call it, drastic or dramatic changes, but we are doing organizational changes at least. I think the future will be more the question is how could we capitalize on the European platform that we have within Cattell. Very few companies have such a platform. And so the question is, how could we drive more profits and drive more values out of that? And I think one word is that we need to be more proactive and looking for the projects. And by projects, I don't mean new developments. I mean I refer more to anything which is any kind of new initiative is a project, so don't misunderstand me. And also how to connect with the various people in the organization to create more direct values of their own creativity, etcetera. Okay. With that said, I welcome Christophe. Thank you very much. I think the first page, which I promised to talk a little bit about is this. You are quite familiar to that one. I don't think there are any dramatic changes. The result is not extremely good. It could have been worse. I mean, don't forget that within the core finance outside the Nordic. The market has dropped by more than 50% or at least 50%. So Even if France and Germany are doing very poor or it's at least partly due to the market condition. And IPM, we will come back to. But the assets under management has, so to say, I would say, stable. It has increased in IBM and it has increased in the other operations. I think I'll rest my case now for advice, yes. All right. Thank you, Johan. And thank you for the kind words. And I'm very excited to, At some point this spring, take over as CEO of Cattell. I think like as Johan said, we are in a fantastic position to continue to develop our European platform. If we turn to Page 3, talk about the results for the Q4, which as Johan said was somewhat of a disappointment, but not without promise underneath and we'll talk about that a little bit. If you look at Q4, it was Modest on the bottom line, especially when we compare to Q3, which was spectacular. Our business, I don't think, should be measured on quarterly results, but long term trajectory and increased assets and profitability. So just bear that in mind as you evaluate the business. But we can always do better and we will do our best. The AUM ended the year at about 130,000,000,000 All these numbers are in Swedish kroner, which represented a drop of €5,900,000,000 during the quarter. Systematic funds, which is we'll refer to it as IPM since the sale of our mutual funds business. We really only have IPM in that segment. Had another challenging quarter. They lost $5,000,000,000 of assets. While our Property Investment Management Group or segment, They actually grew by $4,000,000,000 if we do not account for translation differences. We suffered a little bit from the weakening euro, but the underlying growth was pretty strong due to capital inflow, primarily in our U. K. Asset management platform and our German property funds. We delivered Net revenues, so what was the total income after assignment expenses and commissions of $476,000,000 which Unfortunately, it's €169,000,000 or 26% lower than Q4 last year. That is adjusted for the sale of our mutual fund operations. Of course, IPMs continued capital outflow of this €5,000,000,000 down to now €14,200,000,000 at the end of the year and lack of performance fees in that business contributed at $97,000,000 to that income drop. So that naturally has a significant impact on the group's results and it's something that we work very closely with that team on turning that around. Corporate Finance net revenues were down 41,000,000 or 15% versus last year, same period last year. Good news there though is that Sweden delivered next 1 quarter. Up close to $30,000,000 or 70 percent on the back of just generally strong performance across the board and also Several large transactions. We are very proud. I could tell I was ranked number 1 in Sweden on the sell side advisory side. And Hopefully, we can learn from what these guys are doing and translate that across Europe. Continental Europe though had a more challenging quarter. As Johan said, it's been a rough few months with lockdowns and even though we had some pipeline, some deals fell through and Some deals were delayed and we're standing here towards the end of February, not knowing when that's going to change. But we're working as hard as ever and keeping that pipeline warm. Property Investment Management Revenues net revenues were in line with last year. Although we had less variable revenues this quarter compared to last year. That's a little bit one of the things you have to look at on a longer term perspective. But our fixed fees keep growing with our asset base, which is really what we primarily look at when we look at our Property Investment Management segment. Our operating costs were $68,000,000 or 13% lower than last year, again adjusted for mutual funds, Which is mainly driven by lower variable salaries, performance related in Systematic Funds and Corporate Finance. But we also had some savings, especially related to the fact that we don't travel. We don't go to fairs and We try to use technology as effectively as we can to stay effective. We had some headwinds on the cost side, partly from a couple of smaller goodwill write offs of older investments and some increased consulting costs, Although we believe we get a good return there from restructuring and transaction advice. All in all, our Operating income was $23,000,000 in the quarter, which is slightly disappointing. But we're confident that our underlying performance, primarily in Property Investment Management, remains strong. And we are, of course, addressing the areas where we've had some recent weakness. If you look at the bottom of the short P and L there, we wrote down the value of our loan portfolio by $16,000,000 to reflect changes in the cash flow profile, and we feel very comfortable where we are now. And we had some further negative impacts from the weakening euro, where a lot of our assets And loan receivables are year denominated. On a positive note, at the bottom, we were able to restructure our German ownership to lower our effective tax rate. So in total, Cattello reports a loss of 32,000,000 from remaining operations in the quarter. However, Capella Bank, which is being wind down, actually contributed positively this quarter with $25,000,000 So our total net loss amount is $7,000,000 And I think the bank Is now in a position where we feel comfortable with the provision and the reserve level for every remaining cost to wind that down and we'll take it from there. If we turn together to Page 4, cover the balance sheet as of December 31. I want to point out that this is from our remaining operations, which then Excludes Cattellabank. We have rough guideline. There's another $400,000,000 of assets at equity and a little bit less than in cash. If you want to look at the group's total consolidated position, But as you know, we report this as a disposal group held for sale and without it, our group total assets were about 3,700,000,000 and with the bank about 4,100,000,000 consequently. Don't want to point out too much on this slide, but you can see that the continued focus on Principal investments can be seen in the $720,000,000 of assets in property development projects, Which has increased even more from last quarter, primarily from additional investments in our Danish residential development called Cactus and our logistics project in Norrkoping here in Sweden. Our liquidity remains strong with close to $1,500,000,000 of cash and cash equivalents And our solidity is above 40%. We spoke about this for those of you joining us in the 3rd quarter. While we're happy with our liquidity position, it should be noted that not all of the 1.5 Is immediately available for investments as a large portion is held in our daughter companies. If you see on the graph for cash. The dark shaded part of the bar is what's effectively immediately available in our holding companies. And out of the $1,500,000,000 about $500,000,000 is immediately available at the parent at year end, where about the same amount is sitting in our daughter companies. There will be some dividends, of course, coming our way. And the rest is sitting either in smaller restricted assets for regulatory purposes or in minorities. Once the banking license is returned and we hope to achieve this wind down at the First half of this year, we expect to increase incrementally above what's listed here, our cash balance by approximately NOK 350,000,000 over time. Some is available will be available immediately and some will come when we can dispose of certain assets. We go to Page 5. We turn to our segments and we start with Corporate Finance for the quarter. As we've mentioned, both Johan and I, Corporate Finance net revenues were down. They were down 41,000,000 or 15% versus last year, which in the context of a 47% Year over year drop in the overall market, excluding the U. K, where we really don't we're not really present. You could consider that respectable. We're of course not satisfied. We always want to beat the market and we did so in Sweden. And France and Germany are large markets for us, very large markets And we did underperform our expectations and that's something we are working very heavily The Sweden the quarter in Sweden, which was up $30,000,000 as I said in net revenues, Was also supported by 3 very large transactions with Norama, HagerDupen and Stenhuys, which I think and Johan, I think we both agree that we want to do more of those types of transactions and continue to move up the value chain in Advisory business. For Continental Europe, it was a challenging quarter. We can't hide from that. We have further lockdowns and deal delays impacting our performance. France was down $45,000,000 net revenues, which is 29% year over year. Again, in the context of the market, Not too bad, but not at all what we want to deliver. On a good note there, our Residential Advisory segment continued deliver very strong results in France, which is what we're trying to build upon and get our core platform back on track. Germany and to some part Denmark was a real challenge. Germany has struggled for most of 2020 and we have an increased focus to support the team in terms of this around for 2021. But Germany is It's a tough advisory market and we're going to have a big task on our hands to make this turn this around this year, but it's one of our main focus Perris. I would like to move to Page 6 to talk about Property Investment Management. Sometimes I'll refer this as TIM maybe just because that's how we talk about it. So our Property Investment segment grew, as I mentioned, by $4,000,000,000 in the quarter if we adjust for currency translation effects. And really thanks to strong capital inflow in our U. K. Asset management platform and our German property funds. Of course, looking at the euro translation, we look like we're flat and this is our key growth engine and of course, We don't want that to look flat and we expect that to grow. We still think that our capital inflow was solid, Not quite what we're hoping for, but it's good. APAM, our U. K. Platform added about $2,000,000,000 from new shopping center mandates and that business is trying to broaden its product offering And it's trying to broaden the value chain, which we're very positive and we're trying to support them any way we can. Our German funds grew by about $2,500,000,000 across several funds, none really to point out. But I want to highlight that Now that growth is still net of some material dispositions that we had in one of our residential funds. We added another $500,000,000 in our Hospitality business by a great mandate for the Holiday Inn in Clichyme Paris. And that's one of the segments where there might be some more opportunities given the current situation. PIM, our Property Investment Management, delivered another solid operating profit of 29,000,000 not quite where we want it to be, but maybe solid given the state of the quarter in general terms. This was driven, which we should keep pointing out, by continued strength in fixed fees. We also had some acquisitions where we do get fees and especially in our specialist and Dutch residential funds. And we got some variable these revenues from sales within the European Residential Fund. So this is where we'll see most of our growth coming and where we put a lot of focus on our management time at the moment. As you guys Probably have seen during January, we sold our entire stake in our asset management business in France. This has since the 4th quarter reduced our AUM by about $15,000,000,000 just shy of that and generated a profit of 122,000,000 which will come in Q1. Obviously, we're not in the business of reducing our asset base And we are actively looking for the next opportunity to relaunch our Asset Management business in France to get a new great new partnership going. On Page 7, we cover Equity hedge on fixed income funds, which effectively now has ITMs, systematic macro. This is a tough situation. We can't hide from it and we're deeply involved with it at group level. There's been real headwinds, both on an industry level. Our performance has not Necessarily been worse than our peers, even the largest peers in the segment worldwide. But this Past year 2020 has been anything but predictable. And our products here are based on predicting Outcomes for macro events and that's been extremely successful in the past few years. But It has not worked well for us this year and we've had continued capital outflows and we're down to about $14,000,000,000 of assets now and has been a relative weak fund performance. So I mentioned earlier, we're down $97,000,000 year over year in income. Anyone involved in this industry knows that it's pretty hard to turn around this type of trend, but it's clearly not impossible or beyond us. The Board and the leadership team at IPM Our working aggressively to develop new factors better suited to today's environment. Short term test results By no mean certainty, but they are promising and we're hopeful that fundraising should be successful in the coming year, but this is a longer turnaround. We have taken some Tough but necessary measures to adjust the cost base to this new situation. And we remain very, very engaged at the Board level to drive the necessary changes, and we'll keep updating investor community. On Page 8, we talk about our principal investments. We talked about these at length before And this is an area where we have increased focus and we've continued to invest, as I mentioned earlier, in our ongoing project. I think more importantly maybe is that we're seeing an increased pipeline of potential projects, none that have generating any concrete transactions in the last couple of months, but we have a solid pipeline that that we're working with towards 2021. And I think we look at it with some optimism. We move to Page 9 and hand it over to you, Juan, if you want or I'll continue. I'll get to work It's really it's just strategically and that's why I didn't want to cover the principal investments in too much detail because really that is a way for us to invest some capital, but it really isn't about being a developer or a real estate management company, it's about unlocking more potential for the broader group. And that's what we want to talk about on Page 910, which we've highlighted before, 'nineteen, 'eleven, which we highlighted before in the Q3. And Johan and I We'll talk about it a little bit together. We switch to Page 9. Okay. Yes, I think in order to unlock the potentials, I think we generally need cash. And I know that cash is pretty good. I mean, if we would include the bank cash, I mean, we would have close SEK 52,000,000,000. That is not really 100% through because as Christophe said, quite part of that money is locked into some Dortic companies. But regardless, we have potential to grow and to initiate new projects and to create joint efforts in the group, and that's what we see and that's what we push. And there will be a lot of new investment coming along where we will sometimes invest like with 5% of the capital and sometimes maybe initially 95%. And I think the fundamental reason why we're going in this direction is that we believe we could earn much more on the we could have a better business model to have better margins, especially weaker initiative or initiate new investments and find the co investors along with us while we are driving the project. So that's what we are trying to do. And we see I think all our projects on Page 8, we are now on number 9. But all the projects on number 8 are going according to our expectations or better. I we are very confident about them. And I think we have a with pretty good or very good pipeline. It's more a matter of what we are capable of managing and how we could build the internal competence to manage the various projects. And it is a matter of us investing and also making additional fees within the group by using the different sort of companies in the total value added or in the value chain. I don't know if you would like to continue, but that's what it's all about. And if we go to Page 10, I think maybe we should this one, most of you have probably seen it before, but I think that we while to the left. It shows that we are primarily in the core segment and with residential and a little bit of offices, while I think that we are going a little bit more into the I don't know if you should call it opportunistic or that you add, but we should move into new segments of the market where we believe that over time, the fees could be substantially higher. And that is the that's how we would like to drive the business model in the future. I think we are behind time. So I don't think I could add very much more than that. I think you covered most of the things on the last page, and we want to make sure that we am I rambling everyone has time to ask question. It's been a challenging quarter, but I think the underlying Trends are still good and what we're doing is focusing on growing on our strengths and addressing the 2 or 3 areas where we're having some challenges. So we open it up for questions from the audience. Thank We have a question from the line of Patrick Petriilios from ABG. Please go ahead. Hi, good morning. Thank you. Yes, a couple of questions from my part. If I start with the IPM and Systematic with the funds. We have seen negative operating profit now for 3 quarters in a row. So what is the run rate with the fixed revenue versus fixed cost on this AUM base? Do you need to Increase the AUM base a lot in order to turn a profit? Or can you just reduce cost and still being able to achieve a positive operating profit result in this segment. Thank you, Patrick. It's Very valid question and it's a complicated one. When you're in the asset management business, there's No simple way to save costs to get you out of trouble. You have to do both And that's the challenge. At our as you know, we don't give forecast, but you can do the math on the current Asset base multiplied by our fixed fee ratio, compare that to our current cost base. And you can see that 2021 is going to be a bit challenging. We're doing everything we can to reduce costs without disrupting the operations. We need to have a first class product to sell And that takes some time and investment. But we're trying to cut wherever we can. And focus, I think is the key word. Focus our operations on the right product and the right factors and selling those. But you can do the math that we can't just save our way out of this one. We're going to have to turn this around. Okay. Fair enough. And then I turn over to the Property Investment Management segment. You were able to achieve an operating margin of 21%, if you look at the full year 2020. So that is a very strong quarter, but you were this was also helped by the Grand Central transaction, for example. If you were to Remove extraordinary revenues, what would the margin be on more of a run rate for this segment on a normalized level. Can you help us with that, please? Yes. I don't think there's one answer to that. Obviously, Performance related fees are part of our normal business. They are however very choppy. They come in the quarter and then nothing happens for another 5 quarters or we get some smaller ones as we did in this Q4. We look at our underlying fixed fees to fixed costs and and try to make sure that we have that covered and then work with as much as upside as possible. The variable fees are Not unpredictable, but it's the performance fees that you're talking about when you really close out a big transaction. Do we consider that Run rate or not, it's part of our business. So I think what we have to do and what we can do and we can get back to you if you want with maybe looking at the last 8 to 12 quarters and fixed and variable split out. I mean that I think is the easiest way. I think if you're looking at full year of 21%, that's higher than what our run rate would be without an extraordinary transaction, however you define that. Although this quarter, you can see the 2020 at 12% in the Q4 and 2019 at 10%. In 2019, we had a bit more of variable fees coming in, but we have since grown our fixed fee generation. So Is that a standard quarter? Not too far from it, but we believe that we on an annual basis should have a bit more upside from variable fees. I know that's not a super simple and straightforward answer, but That's how we look at it, slightly better over the longer term. Okay. Yes. And what you mentioned there with the fixed fees versus fixed Cost, yes, that would be lovely if you could provide that historically as well. So we get more transparency to and get the right expectations going forward. Looking into the principal investments, How which is any of these projects in the property development projects ready for an exit mode, so to speak, in the coming 12 months or are they still being evaluated and worked on? Well, I think the first answer is they're all being worked on and they're all being evaluated. As you know, We don't have quarterly targets that we have to meet or set. We operate on a premise of delivering maximum returns at the right time. But I think there's some likelihood that at least Maybe one of these could be realized in 2021. And some of the ones that Seyscha und Dusseldt Wurzen Are bigger in scope and have several generations of them. So we'll see what if there's going to be something on the shorter term, but that's harder to predict. But that's a bit of a longer term project. I think Cactus and Norrkoping are more in the, let's say, 12 to 24 month time frame. Okay. Yes. Very helpful. And then if I turn over to this Transaction you did in France with the Property Asset Management, you're right there in the CEO word in the CEO comments in the beginning of the report that you are looking to come back to that market. How does that market look like? What can we expect in terms if you were to do an M and A transaction in that market. Are you looking for the same kind of asset on a management base? Or would you want to have an Even stronger asset under management base in that market. And how does the price level look like? Is it Should we expect similar price level as the transaction where you sold the property asset management here in the Q1? I don't know if I should answer that. But I guess our intention is more to have a start up with someone who have done it before like we did in the past. We are I mean, I should say that we have serious discussions, but we have approaching by different individuals who would like to start up together with LAB. It's also strategic decision a little bit how we do with Kriag, which is the German operation working in the commercial based more than residential. And to what extent should we just have an asset management operation? To what extent should we set up new funds. And should that be done in separate units in France? Or should that be done currently creating that. We there are some specific definitions to what we're referring to the situation in France and Germany and the Continental Europe. It's a big market for us, Patrick. But I think we are Values today in the market are no cheaper than how we sold. And we have to be very careful if we're looking at M and A, which It's trickier. We have been arguably at least even more successful when we grow our own partnerships, although it takes a little bit more time. But it's an important market for us. Great. Is there any other market geographically that you see untapped potential here? Fundamentally, I think we are if we are capable of growing in Germany, France and England for a great bit. And I think that's where 8% of our market is, I think we are happy. And if we could grow by 10%, 15%, 20% in our asset management business market. I think that is big enough target for us. I mean, of course, there are some other big markets, but there's a bit premature to open up the question, Bob. We are growing in Spain. We have a decent profitable operation. It was last making for many years, but today it's making money. And I think we have some initiatives in Scandinavia as 12. But the big markets for us are primarily in Germany, France and England. Okay. Thank you. We should try to double in those markets instead or maybe spreading around in a lot of new. But we have to be a little bit more I mean, we have to be I shouldn't call it the DCM market, but we should be more in the capital market than they did that's right today, just depending on how you define the capital. Yes. Thank you so much. Just a Final question here from my part then. You mentioned some extraordinary items in the P and L. Can you specify them? You mentioned the write downs of the loan portfolio and an SEK 8,000,000 goodwill impairment. I just want to make sure I got all of them. If you can specify them, please. Yes. No, I think that they have SEK 70,000,000 of tax. Well, that was earlier. Yes, that's why, okay. Patrick, you'll find them all in the actual report, but the loan write down was €16,000,000 The Currency, the euro effect, I don't have at the top of my head, but it should have been around just over 20. We had A deferred tax asset write up in the quarter of $20,000,000 We had a write down $70,000,000 earlier in the year. So on a net basis, if you look at our annual tax rate, you have basically The deferred tax asset impact of $50,000,000 negative for 2020, looking at our overall tax rates. So our reported tax rate is over 50% for 2020, but if you adjust for those, it will be 37. And the goodwill write down, we had one of our Older asset management investments in the Nordic region was written down by $8,000,000 and we had some acquired system infrastructure in our systematic macro that is no longer utilized of €3,000,000 So those were the bigger ones. Perfect. Thank you so much. No problem. And we One more question from the line of Henrik Elvisko from Redeye. Please go ahead. Okay. Gentlemen, do you hear me? We can hear you well, Henrik. How are you? All right, great. I'm fine. Thank you. Well, first My first question is a little bit of a follow-up question on the performance fee discussion regarding PIM. You get well, when the mandate ends in PAM, You typically or potentially, you get some performance fees. And so Could you maybe give us an idea of when I mean, They have several mandates, but is the rate of ending mandates stable or is it increasing? Or could you say something about that so we have an idea of what to expect there? Sure. I think from on a macro level, as we are growing our portfolio and it's not terribly mature yet. I think that's a little bit a lot of them are further out into the future. That doesn't mean you couldn't realize quicker if you do an extremely good job or your customer wants to be more optimistic. But I think we're in the growth space. So that's what's most important to us, to continue to build value. As I mentioned earlier, we're not in the market of delivering to quarterly expectations and it's maximizing the value for our investors. We don't forecast or predict or announce underlying values. But what I can assure you is that we're building it up to maximize it long term. And as you know, this segment is Not new, but it's a growing part of our business. And therefore, I would not with the exception of a few of our funds that have a little bit of maturity, expect all too much in the coming 12 months unless it's a unique situation where we have a great mandate to exit. All right. I'm not sure if you can comment on that. Yes, I mean, it's a little bit it's also a question of how you define performance fee. And we have that discussion internally how to define it because part of the funds are actually set up in order to make money out of performance fees. Performance fees is not only over performance when it comes to the terms. We have defined performance fees as acquisition fees and disposal fees, which is I think various companies assess that different and but we have said that they are part of the former piece. But actually, that is a very big part of the revenues in those funds. That's how the typical German tons operate. Maybe 50% of our tons do have performance fees, which I consider performance fees, which is a certain return over a certain hurdle. And but that's not only the kind of performances that we encounter or take into consideration here. So it's a mixture of many things. I would say that the fixed fixed is much better than what Christophe or what we disclose here. But That's how I see it, but we know that some of our capacities have a different definition of it. So we have adopted to what Some companies are doing in the market. I think, Jan Erik, what we're going to do and try to do is Increase our transparency, but we have to have the right definition that we all feel comfortable with. We have 3 kind of 3 components really, fixed, variable and performance. And performance is what you were relating to and that's broadly on exits. Variable can be acquisition disposal, it could be a letting, it could be CapEx, investment fees. It could be a number of things, which you have along the whole cycle. And It's an ongoing discussion here on how to report it because we know the peer group is complex And we don't want to send the wrong signals that we are much better or much worse than anyone else. And That's going to be a continuing discussion on how we disclose that. But I think from a performance fee, which is exit based specifically with a young portfolio. Most of those will be a little bit out into the future. All right. Thanks. Okay. Well, then another one regarding PIM. You mentioned in your the previous report, the Q3 that you're reviewing Germany in order to capitalize on your strong position, etcetera. And is that basically what you're describing here? Or is there is this something that's still ongoing and more coming in terms of communicating what you're doing, I mean. I think For now, this is still an internal matter. But we think we have More potential in maybe some government funds where we think we can be more aggressive on new segment, new capital. And that's where we're trying realign ourselves from group level, but that's kind of still an internal discussion and Not something that's done very quickly, but clearly, it's a focus area. Like Johan said earlier, if we grow our big markets, then that's About half the battle, it's a big part of the battle. Okay. And then on IBM, you are in the process of launching a new fund, correct? Well, we're launching several new products and funds will be disclosed if they go out to market. Okay. And is there a time line here that you would like to share with us or? I don't think there are any secrets. I think that in the past, I was disclosing that we In the systematic macro, there are several components of product. And we have launched a new commodity product. It was launched in the beginning of January. It's now included, but it could also be used as a carve out and where we could attract, so to say, manually for the commodity products. We have launched during last year a somewhat change FX product. We have we did implement a new emerging market, the best market product, which maybe it's not a new product, but with the new product. And we are working at the time with a new short term trading product, which also could be used as a carve out and used as separate products for anyone who would like to have a short term product, which is quite attractive in the market. They have generally over perform compared to maybe the more systematic products, but it will be part of the systematic product because we have been missing that part. So whether it's a new product, a new fund or just a separate account, however, We work with different kinds of structures, so it's not a fun. But we have the ambition to attract more money to these new initiatives that we have been working with for quite a time. Right. That we have been working with for quite a time. All right. Okay. Just finally then, You are introducing a new incentive program with and now referring to the capital allowance. Your ambition to include a large number of employees or not. I mean, we have I mean, I talked about the option scheme that we've made a decision of in December. Is that the one you're referring to or what? Yes. Okay. Okay. No, I think that a big my feelings at least about that is that People should be incentivized on the level which they could really have a big impact on, which means that most people are incentivized in the structures where they are working. There are disadvantages with that, which means that it doesn't maybe incentivize people to collaborate to the full extent. So I mean, there are pros and cons with everything. But generally, the options that we have that we decided on will be given or will be sold because they have sold on market conditions. So you could always argue whether it's a big benefit or not or any benefit, but because we sell them based on the Black Ops models, so they are market price. But they will be on the group level. We have a lot of incentives for, so to say, shareholder structures in the various companies, which is also part of the problem that we face in Cattella because We are being taxed on every corporate level that it's difficult to for us to use deferred tax losses in certain operations due to the fact that we have partners in many operations. So it's the pros and cons with that as well. Yes. Well, thank you. That was all for me then. Thanks. Thank you, Henrik. And as there are no further questions, I'll hand back for closing remarks. Okay. I think I mean, as we started saying, it was not a good quarter. I think we can do better. I think just utilizing our cash, I mean, we'll hopefully provide a much better much, much better numbers. And we believe that we could create very good returns not only on the direct investments but also, so to say, connecting our money as the individual's or other entities' money. We'll create growth and return. So That's a challenge that we are working with, but I'm quite optimistic. I think we have done some I shouldn't call it dramatic, but we have I think on the group level, I think A lot of new people are coming in and some are leaving us for different reasons. And I think we will be much more focused in the property market and our competence in the property market will dramatically improve on the group level, which I'm sure will have a big impact over time. So I'm very optimistic. So I'm yes, I shouldn't say that I'm happy to leave, but I'm optimistic about leaving. All right. So that was it for us this morning. We appreciate your time and thanks for listening.