Earnings Call: Q3 2018

Oct 25, 2018

Hello, and welcome to the Kinnevik AB Q3 Report for 2018. Throughout the call, all participants will be in listen only mode. And afterwards, there will be a question and answer session. Today, I'm pleased to present the CEO, Georgi Ganev. Please go ahead with your meeting. Thank you very much. Good morning, everyone, and welcome to the presentation of Kinnevik's results for the Q3 of 2018. So I am Georgi Janev, Kinnevik's CEO and with me today is our CFO, Joakim Andersson and our Director of Corporate Communications, Tore Litzian. We will start by taking you through a presentation, as usual of the results released this morning. And after that, we're happy to answer any questions you might have. So please turn to Page 4, where we have provided you with a summary of the key highlights for the quarter. The 3rd quarter has been characterized by high activity in all parts of our portfolio. Our telecom companies have executed transformational deals and our investment activity has been high as we continue to deliver on a strategy to accelerate our private portfolio. In August, we distributed our MTG shares to our shareholders to facilitate the clearance of the merger of Tele2 and Com Hem. And I'm happy to note that on 8th October, the European Commission approved the merger. I will come back to this milestone transaction in a short while. Our financial performance was weighted down by Zalando's weaker than anticipated trading in the quarter on the back of the company's profit warning, but we remain convinced of the company's long term strategy and potential. The net asset value was SEK78.8 billion at the end of the quarter, reflecting the weak share price development in Zalando. And in addition, we distributed our shares in MTG during the quarter effectively transferring SEK4.2 billion or SEK0.15 per share to our shareholders. Our financial position remains strong with a net debt of $4,100,000,000 or 5 percent of the portfolio value. Now please turn to Page 5 for an overview of the performance of our large listed companies. So, Solana reported 2nd quarter figures in August. In September, the company revised its guidance for the 2018. The extended and unusually hot summer period together with a delayed switch to the fall winter season weighted down both on revenue growth and adjusted EBIT. While this clearly does not reflect Zalando's ambition, we are still confident that the company's ability to deliver on its long term strategic plan. The market penetration of online fashion e commerce in Europe is expected to continue to grow strongly and for Zalando important long term growth indicators such as the partner program share and the number of active customers continue to develop positively. Zalando will report its full third quarter numbers on the 6th November. Millicom reported solid revenue growth with LatAm service revenue growing 4.7 percent and EBITDA growing 4.2%. This was the 4th consecutive quarter of positive organic mobile service revenue growth and I'm particularly pleased to see that Millicom's investments in Colombia contribute to improving operating and financial performance. 10.02's final quarter before the closing of the merger with Com Hem was a quarter of solid business trends. Revenue grew 4% year over year and adjusted EBITDA margin amounted to 30% and Tele2 also published yet another upwards revision for the full year. Com Hem saw improvements in operational KPIs as churn reached a record low in the Q3. Group revenue declined slightly driven by a decline in the Boxer segment, but with the margin expansion in both the Com Hem and the Boxer segment, EBITDA grew 4% and in line with guidance. Now moving on to Slide 6, where we highlight the progress on creating the new Tele2. Shareholders of both Tele2 and Comphem approved the merger in the middle of September and with regulatory clearance in the beginning of October, the transaction can now be finalized. The 2 companies were formally merged on the 5th November, creating a leading connectivity provider in the Baltic Sea region, offering more and better choice to consumers through a portfolio of truly integrated services. And I'm very confident that a combined entity is well positioned for the future and the employees of both Tadetoun and CompHem shall feel very proud of what they have achieved so far. The hard work from the both organizations during this year has created a solid foundation on which to build. And for Kinnevik, the merger is a testament of our active ownership and it illustrates how we can support our companies as they execute on their strategic vision. Now please turn to Page 7, where we take a closer look at Millicom's acquisition of Cable Onda. Millicom's goal is to be a customer focused and convergent provider of high speed data in Latin America and the acquisition of Cable Onda in Panama fits perfectly with this strategy. Cable Onda is the leading provider of broadband Internet, pay TV, fixed telephony and B2B telecommunications services in Panama. And Panama is also an important business hub in Central America. And after the acquisition, Millica will have country operation spanning all the way from Guatemala to Colombia and significantly improving the value proposition for businesses in the region. The transaction is expected to close by the year end of 2018. Now please turn to Page 8 for an overview of the momentum in our largest private companies. Our private companies experienced solid growth during the Q3 and I will go through some of the highlights before I cover GFG in more detail on the next slide. I'll start with Quikr. Quikr, which operates 2 types of businesses, classifieds and transactional across 5 categories is currently benefiting from positive momentum. The verticalization strategy has allowed the company to improve both engagements and monetization on the platform while reducing marketing costs. Assets under management and betterment amounts to $15,200,000,000 at the end of the Q3 of 2018, an increase of 39% compared to last year. And the number of customers totaled to 384,000, a yearly increase of 32%. The company has launched a number of product innovations and has continued to develop its platform beyond a single digital product to a multi plan advice offering. And the offer also includes access to certified financial planners and licensed financial consultants. Babylon's AI platform is increasingly attracting strategic partners. And during the quarter, Babylon signed an agreement with Prudential, a leading provider of medical insurance in Asia with over 5,000,000 health customers in the region. Under this agreement, Babylon's AI will be made available to Prudential existing and new customers in up to 12 markets in Asia. Livongo had more than 90,000 members at the end of the Q3 and the company demonstrated a strong momentum in the health service agreement with solid growth within some of the largest health plans in the U. S. The hypertension products is proven to be successful and Livongo announced the first cellular enabled blood pressure monitoring system in the U. S. During the quarter. Now please flip to Page 9 for an update on Global Fashion Group. With a continued focus on further developing assortment in customer service, Global Fashion Group continues to add customers now amounting to 10,600,000 active customers at the end of the second quarter, up 15% year over year. Revenue growth accelerated from the Q1 on a constant currency basis and the adjusted EBITDA margin continued to improve. However, continued significant depreciation across both the Brazilian real and the Russian ruble put pressure on absolute euro growth in the quarter. Brand acquisition engagement continues to be a priority and we see good progress here. In addition to the local and international brand acquisition in the region, the international buying team acquired 16 new international brands in the Q2 of 2018, including Sea by Coal and L. K. Bennett and Rice. Please turn to Page 10, where we now will highlight the IPO of Westwing. Westwing was listed under Frankfurt Stock Exchange on the 9th October and as part of the IPO Westwing raised €130,000,000 of primary capital giving the company good room to invest in growth going forward. After the IPO, Kinnevik remains a large owner with 13% of the company. Trading during the first half of twenty eighteen was solid and Westwing continues to be EBITDA positive. The value of Kinnevik stake in Westwing increased by 47% to SEK748 1,000,000 compared to the Q2 reflecting the pricing at the IPO. Page 11. As you know, driving growth and value in our private portfolio is a key strategic priority. And during the 1st 9 months of 2018, we have intensified our investment activities adding 6 new companies during the Q3 alone and 9 companies year to date. Within Financial Services, we have added 3 new companies to our portfolio: Moniz, the 1st mobile only banking app in the UK Deposit Solutions providing an open banking platform for banks to offer 3rd party deposits products to their customers and Bread, operating in the boundaries between financial services and e commerce, offering a white label payment solution to online retailers in the U. S. What unites these companies is that they are digital challengers, finding innovative ways to serve their customers online. We also added 2 new Nordic companies to our portfolio during the Q3, Karma and Kolonial. Kolonial is the leading online grocery store in Norway and we have been impressed by the founding team and what they have achieved in a relatively short period of time. Addressing another part of the food sector, Karma reduces food waste by letting customers buy unsold food at a discount through their app from local grocery stores The largest investments in our private portfolio in the Q3 as well as year to date was the 443,000,000 second investment in GoEuro. Please turn to Page 12 for a closer look at that investment. GoEuro is an OTA, so called online travel agency that aggregates all major modes of transportation in Europe. The company allows consumers to compare journey options across rail, bus and air travel and to make bookings that include multiple modes of transportation in one ticket. The attractiveness of the business lies not only in the fact that it's a large sector with low online penetration relative to airline booking. Go Europe has also built an unmatched inventory and deep supply partnerships with over 600 rail and bus operators across 15 countries. Naren Sham, GoYoor's visionary founder is backed by a number of strong global investors and we're very excited about partnering up with Temasek, the global investment company headquartered in Singapore, which shares our philosophy of an active long term ownership. With that said, I would like to hand over the call to our CFO, Joakim Andersson to comment on our financial position. Thank you, Georgi. On Slide 14, we present the key elements of the NAV development in the quarter. The weak share price performance of Zalando had a significant negative impact on our net asset value during the quarter. Also, the distribution of MTG to our shareholders reduced NAV with SEK 5,000,000,000. The value of our private portfolio increased during the quarter to SEK 13,700,000,000, largely driven by net investments of SEK 1,200,000,000 during the quarter, partly offset by GFG. The value of Global Fashion Group amounted to $4,600,000,000 in Q3 compared to $5,000,000,000 in the previous quarter, a result of multiple contraction among listed peers as well as the depreciation of both the Russian ruble and the Brazilian real. In total, our NAV decreased by 18% to $78,800,000,000 and NAV per share was 286 dollars in the Q3. As of yesterday, our NAV was $77,900,000,000 or DKK 2.83 per share. Please turn to Page 15 for an overview of our balance sheet. As previously mentioned, our investment activity has remained high during the quarter. And in total, we invested SEK 1,500,000,000 and made divestments amounting to SEK 312,000,000. As a consequence, our net debt position increased to $4,100,000,000 at the end of September, which corresponds to a leverage of 5% of the portfolio value. In the Q4, we expect to receive $1,300,000,000 in cash consideration from the Tele2 Com Hem merger as well as around $450,000,000 as Millicom pays out the 2nd tranche of its annual dividend. Therefore, we remain confident that we have a strong financial position that will enable us to continue to execute on our strategy. Georgi will now take you through the last slide of this presentation on Page 17. Thank you, Akim. Yes, to finishing off this presentation, I just want to repeat that I'm very excited that the merger of Tele2 and Com Hem can now proceed to be finalized, a merger which is a clear testament to how we drive active ownership in our companies to create value. The intense investment activity in the private portfolio year to date should be seen against a fairly muted pace in the recent past. Going forward, I would say that activity will remain high as always within Kinnevik, but I also expect that a number of new investments will go down as we will also focus on working with our companies to ensure that they are well positioned to execute on their respective strategies. Thank you very much for listening. And let's now open up for questions. Thank Our first question comes from the line of Magnus Zroman of Handelsbanken. Please go ahead. Your line is open. Thank you. My first question regards to your investment capacity. I mean, you made no less than 10 new unlisted investments year to date. But from the context of available pipeline, capital available for you and perhaps also capacity in your investment organization, how should we view prospect for new investments in the year to come? Okay. Thank you, Magnus. If I actually start a bit about the investment capacity in the team and then Joakim can elaborate a bit on the financial side. We still have a portfolio today compared to more than a year ago that it's including less companies. So we feel that we have a team that is suitable to handle these investments and also our, let's say, continued pipeline. But again, as I said, the high activity, especially this quarter with 6 new investment and 9 year to date should again be seen against a fairly muted pace in the past. So we don't expect that tempo of new investments to continue. But the current pipeline that we have and perhaps the slightly larger ticket going forward will be able to handle by our existing team. Yes. And then on the financial side of things, as you've seen this quarter based on the portfolio value coming down and the net investments, we have a leverage of around 5%. However, as I said, we expect around about $1,700,000,000 coming in from the Com Hem sale and the Millicom dividend. So pro form a, if you just add that back to the numbers, the leverage would be around 3%. So we are quite comfortable that we have ample of firepower within this financial leverage target that we have. Okay. That's clear. In terms of divestments, I mean, you mentioned, Georgi, here that you have lesser companies in total. Can you tell us which companies were divested under the post other in Q3? The largest divestment was Lineo. So the number was Joakim, the total of 300,000,000 is on the slide, 300 12, right? 312 in total. So it's on Page 15 in the presentation. So it's a lean year, 273,000,000 and the other 39,000,000 is some smaller companies in that long tail we kind of clean up. Yes. So that was what I was asking about or wondering about which companies were in that other bracket of €39,000,000 But perhaps we can come back to that. But in terms of the Lineo divestment, I believe that you I mean, you divested this holding for SEK 273,000,000 as you stated and right. But I believe you invested in total SEK438 1,000,000 up until the end of 2016 in this company. But then you also made a share swap, I believe, from with Jumia share swap to Lineo shares. So can you please remind us of how much you invested in Lineo in total and the result of the divestment then? Yes. I think we can look at that detail and perhaps get back to Magnus offline, if that's okay. Sure, sure. I just have one final question, and it's on the listing of Westwing. I believe you own 13.4% in the company after the dilution in the IPO and that should correspond to 2,700,000 shares. And that places mark to market value at just below SEK 700,000,000. So I was just curious to your valuation of SEK750 1,000,000 there, if there is something I miss. That was the end of the quarter, Magnus. Yes, yes, I understand. But I guess that it hasn't traded. I can't see that FX traded so much higher that would represent that value, but perhaps on Probably FX effects included as well. So what we did, I mean the value in our balance sheet is as per 30 September based on eurosec rates as per that day. And then what we did was to take the pre money valuation per share at the IPO and use that on our shoveling. Okay. Thank you. Thank you. Thank you, Magnus. Thank you. Our next question comes from the line of Joachim Gunal of TMB. Please go ahead. Your line is now open. Thank you. Good day. So a few questions on Betterment. We note here in the quarter that it managed to increase its asset under management in relation to customers having been in a downward trend for the 2 quarters prior to this. So what is driving that development? Basically, there has been a strong momentum in betterment for the past, let's say, year past quarters. We've seen some volatility depending also how the market develops. If there's some uncertainty in the market in general, then the inflow of new asset management is slower. So there is no specific reason for betterment growing slower some quarter and a bit higher in this from my perspective. All right. No, no, but I was referring to the assets under management in relation to the number of customers. So an ARPU or what you would call a Q play like that? I see your point, but we have not seen any, let's say, isolated reason for that change. All right. Thank you. And another question here on Betterment then. How would you say that it is positioned for, I mean, a significant downturn in capital markets? I can only assume that some Betterment customers are seeing some red numbers on their accounts right now. So if you can just elaborate a bit on how you think Betterment is positioned for that? Of course, it's a very valid question. Of course, when you're managing people's money and you're going into a downturn, a recession, that will affect you. However, if you see from a different perspective, you can also say that the companies with the best cost efficient platforms such as Betterment would actually have an opportunity to grow relatively their competition in such a downturn. And I believe that in times where you have red numbers, you also, let's say, maybe we'll try to evaluate how much how many basis points you paid for the service you get. And we know that Betterment is a very competitive offer in the market with a high NPS score from the customers. So we see at the same time that even though it of course will affect Betterment's growth, relative to competition, we actually believe they can be strengthened. Thank you. That was clear. A final question on Bettermentum. I mean, I read an interview just a month back here where the CEO and founder said that it is building an institution and foundation to go public eventually, commenting that it would probably have to be at least twice as big as it is today. So in your view, what parameters should be met before that topic would even be on the table? And first of all, we see this as a long term growth story. So we are not, as investors, really keen to push an exit or an IPO whatever you call it sooner than we need to. We believe that the company is in a very positive growth trajectory. It's a strong team, strong position. They are after all the largest independent online advisor actually in the world. But most probably the founders are right. The company needs to reach a significant bigger size before it can actually continue to grow in the public environment. But again with that said, we have no rush in this on this topic. Thank you, Georgi. My last question, it revolves around these types of new investments that we are seeing, more venture capital like. I mean, you don't press release all of them. So in this quarter, we have seen investments which have had a quite material impact on your net debt. So could you just is this something that we should expect going forward? Or will you try to press release so that we can have a better understanding of the implications of your net debt? I mean, first, when it comes to press release, it's also in relation to the size of the investments, obviously. And I would say that the activity in this quarter was very high. I said 6 new companies in a quarter, making it 9 new companies year to date. And I would expect the company the number of new investments to go down. But they'll say the reason for press release in some of them is that they are larger. And also on that, our website will always be updated with investments independently if we proactively send a press release or not. Roger that. Thank you. Thank you. Our next question comes from the line of Derek Lallywertier of ABG. Please go ahead. Your line is now open. Yes. Thank you. I had a question on emerging market exposure and whether you have a clear ambition to reduce this given that I mean, we sold Avelto several years ago. The new investments haven't really been in that area, and the portfolio is still over 30% exposed to these markets. Yes. I mean, our strategy, as we also disclosed on the website, is basically to focus on Europe and U. S. For new investments. And we have a special focus that we've said in the Nordics, we want to be more active in, let's say, early stage companies and the startup community. That said, with the right partner or with the right angle through our existing investee companies and go further in the emerging markets. What we say is that as an investment, we're willing to take risk. And as Kinnevik, we have always had a DNA to take, let's say, big bets. But when you're compounding risks, including emerging markets exposure, early stage businesses, tech ventures, of course, the risk can be too high. And therefore we have said for new investments we mainly focus on Europe and U. S. And the current exposure in emerging market is relatively to our let's say to our old investments. But if you then specifically look at a company like Millicom, what we have said for several quarters now is that we really support the company's strategy to pull out out of Africa and focus on Latin America. So of course that's also a testament to our active ownership and try to steer the company into regions where we feel that we have more control of the risks. And my question on the GoEuro, it seems like a really exciting company and a great idea, founder and team, etcetera. I was wondering what's the main focus for this company now after the main challenges ahead. I mean, if you go in and look at the website, I mean, it still seems like it's in a very early stage on this aggregate sort of search on different methods of travel. It's not really seem to be up and running. So it's the main thing. Yes, but I think that yes, they have 20,000,000 customers using their services, many of them into the mobile app. So of course, it's already today a well functioning service for customers from 120 countries. But having said that, you're right that their, let's say, focus until today has more been on the back end side. So they have developed a unique supply side of the business integrating these 600 plus transportation companies on the ground, which I think is the core of their value proposition. With now a strength and, let's say, financial position, they are able to continue to develop and to improve the front end interface for the customer by developing their technical platform even further, hire the right people, of course, to strengthen the team and continue to grow. So we believe that what they have built so far is a very strong value proposition. And with this capital and the right investors in their base, they have now the ability to scale. All right. Thank you. Thank you. Our next question comes from the line of Marie Sheyhyay of Nordea. Please go ahead. Your line is now open. Hi, and thank you for taking my questions. I have a question regarding the focus on unlisted ventures and increased dividend gap. Could you give any comment on the common dividends? No chance we should see the MTG distribution as a part of the dividend. Hi, this is Joakim. So yes, I guess what we've done and as we said before, we are not worried. We see potential based on the guidance in Tele2 from Tele2 Com Hem, we see some potential there. So we are not particularly worried about the dividend gap as such. And also the way we look upon it is that we don't look only on the dividend gap, but from a total consolidated cash flow position where we have the incoming and outgoing cash flows and then tie it out into the leverage target. So it's kind of a bigger question than only the dividend gap in our minds, but we are very comfortable. Yes. But just since you're focusing more and more unlisted boat ventures that doesn't really pay any dividend, then should you adjust your dividend after this change of in focus? No. We don't see any reasons to do that. And the focus on the investment side is rightly into the private side of things. But no, we don't see any reasons to do any adjustments. I think you can say, Maher, that we of course appreciate that distributing MTG, that is a company that gave us, let's say, proceeds, it was still a relatively small amount, dollars 200,000,000 and with, let's say, the consensus we have on the new Tele2, we expect that company actually to increase its dividend over time. So to answer your question, situation now going forward like for like, we don't see any reason for adjust our financial position and targets. Okay, super. Thank you. And also given the recent poor performance at Zalando and your conviction in the case, no chance you could increase your holding in the company? I mean, that's a very good question because given the what we think is an overreaction on the share price of Zalando, you could say it's time for buying. But again, we need to also go back to our exposure towards one single share. So we are the largest owner in Zalando owning 32% and it still represents a large part of our portfolio. So I think that is more the question from us where we also buy or sell in a company. But having said that, as I said in the report and as I said when I commented the press release when Zalando a month ago actually issued their profit warning, we think that this, let's say, short term change in the guidance for 2018 does not really impact at all the potential of Zalando's, let's say, growth and ability to deliver on the long term targets. What Zalando have is a unique platform within e commerce and a leading position within fashion, but only having, let's say, a bit more than 1% of the fashion market in Europe means that it's a very good, let's say, room for growth going forward. And this trend from offline to online, we just continue. And with the ability to continuously innovate and improve the customer services that they have as well as strengthen their partner program position, which I think is extremely important and broadening this assortment within cosmetics that they've done now in the recent past, they are executing on the strategy exactly as we would like them to do. So we are confident, but the questions about buying is more going back to our portfolio strategy. Okay, super. Thank you for those answers. Thank you. Our next question comes from the line of Liana Osterberg of Carnegie. Please go ahead. Your line is now open. Thank you. Good morning. I've got 2 questions for you. First of all, I was a little bit curious if you could say a little bit more on Global Fashion Group. You have the new management team in place now for a little bit. And I was wondering if you could say, in addition to sort of the widening of the assortment, what's going on on the centralized level? You talked that there are some synergies that you could extract between the companies. So how is that proceeding and what is going on? And then the second question is on Babylon and the new agreement with Prudential. I assume that's just sort of leasing out the platform. So how does that business model differ from what they have in Rwanda and with the NHS in the UK? And is that how they will continue to grow forward by licensing the platform rather than expanding themselves organically into new markets? Thank you, Lena. So I will start with BT then. As we said now, we've had 2 co CEOs for some time and they have developed the business in a very positive way. We see improvements in growth in local currencies in all regions as well as improved profitability. And they look at HQ and synergies. I mean, they have definitely strengthened the central buying team. And we have also have discussed directly with the local management of some companies that can assure me that there are some very concrete activities now paying off and how to everything from but also in private label and so forth. And I think the results speak for themselves, even though we had a very tough situation in Russia due to the ruble and Brazil due to the real and on top of that this strikes on truck drivers in Brazil, we're outperforming all of the let's say, public peers that we have compared within these regions. And we, as I said, are growing 20% for the group. In ICONIC that we know, together with Salora, we have a very strong position growing as much as almost 40%. So yes, I think that even though we don't have any more specific, let's say, details to disclose on exactly the central strategies central activities, we see clear result from them. When it comes to Babylon, exactly as you pointed out that the business model of licensing the platform to Prudential in Asia is different from let's say more B2C services. But remember that Bablov has spent a lot of time and effort to build this platform and it makes a lot of sense to have 2 business types, 1 enterprise sales model where we actually find these partnerships and one B2C model. And I don't think it's going to be either or going forward, but actually both of these models together because it will be very difficult to scale its businesses only on the B2C side. But on the other hand, if you turn into a platform provider, it's a different thing. So what we see now is that Babylon developed its platform in order to increase the efficiency on its own B2C services. And with that, let's say, proof point and with that effect in efficiency, they have the best case test case study in order to get new strategic partnerships. And we have no information of let's say other partnerships looking like Prudential. But I would say that, that is, of course, all around the globe, a huge potential going forward. Okay. Thank you. Good luck today in London. Thank you very much, Leo. Thank you. Our next question comes from the line of Nissela Neizer of Deutsche Bank. I just have a couple of questions on my end. Firstly, on GoEuro, which was quite a sizable investment that you made. Could you give us a bit more color on the size of the company? How much is Kinnevik's stake at the moment? How big is the company in terms of revenue? How fast is it growing? Is it profitable? Some of the KPIs around GoEuro would be great? And secondly, when you look at your Q3 investments, out of the SEK1.5 billion that you invested, half of it almost is in Financial Services. Could you just give us an understanding as to why you think Financial Services is at a tipping point or is a lucrative sector to sort of invest in going forward? And maybe highlight some of the more promising companies you've ventured into out of those few that you've done in Q3? Thank you. Thank you for the questions. If I start with GoEuro, unfortunately I have to disappoint you because we are also then bound to the information that the company has disclosed. So when it comes to let's say valuation which is then in relation to our own stake, we have no comments on that one for the time being. Same thing with the KPIs. So we need to on the back of what we can disclose, unfortunately say that what we can say we have already told the market. Going forward as with all our private companies or the companies in the private portfolio, we hope to be able to disclose more KPIs. And this has to do a lot with how competition will use these numbers and so forth. But I understand your interest in the KPIs and I can always say that we look forward to come back to that question. When it comes to investing in new companies and financial services, If we look at our portfolio today, we have an overweight within our telecom sector and our e commerce sector. Telecom because we have these large listed public assets and in e commerce because we have Zalando, so naturally being a large part of our total NAV as well as Global Fashion Group. So what we have said, even though we have done now a few investments in the, let's say, e commercemarketplace area, we focus a lot on finding, let's say, the new icons in the markets within financial services and healthcare. So that we did more of them in financial services had not a specific reason that we feel that that is in a different, let's say, stage than healthcare, but simply that we had addressed and we had a dialogue with these companies that we all think are brilliant ones. And our investment strategy is to go in with a more thematic approach. And as you see, some of these companies are a typical B2C service as with Moniz, so a NeoBank or a Challenger Bank in the UK, but deposit solution being an open banking interface for banks and bread being in the, let's say, the boundaries of financing and e commerce support for e tailers. So if I look at bread, we feel it's a natural way for us to expand our knowledge within e commerce in the ecosystem as we did with Budbee and Last Mile Logistics because we understand what e tailers typically need in front of a payment and analytical service. And therefore we could do a due diligence on Brad and feel comfortable that they have an extremely good value proposition in the market. And for Moniz, we have been looking at neo banks for a long time, studying the big ones like N26 and Revolut and so forth. We think that Moniz have a very clear customer segmentation and also a positive trend and they're unique in attracting customers that actually choose this bank for their current account. So not only as an add on service, but actually having Moniz as the main bank. So that was the specific reason for investing in Moniz. In general, financial services is a I mean, it's a huge, it's a vast market opportunity and it's a industry that needs to be, let's say, digitally transformed. And again, with our DNA within tech companies, it's natural for us to look carefully into that sector. Great. Thank you very much. And there are no further questions at this time. Please go ahead, speakers. So thank you very much for listening in and for all the questions. And just as a last reminder, we would like to inform you that we will report the results for the full year of 2018 on the 8th February 2019. So with that said, thank you very much. Have a nice day. This now concludes our call. Thank you for attending. Participants, you may disconnect your lines.