Earnings Call: Q2 2020

Jul 22, 2020

Thank you very much, and hello, everybody. Together with me on this call, I always have with me also our CFO, Bengt Lejstrom, who will walk you through the financial details. But to start off, I would really like to say we're very delighted to present a strong report for the Q2. We had a good pace, although we've had a very problematic pandemic for everyone around the world. Stiktec as a company has been strong through that one. Health is always our first priority. And currently, the effects are fairly low on our side, about 38 people out of 1300 are unable to work due to the pandemic. So it's a small share. And the majority of those personnel are in the UK. Our net sales are also stable through the pandemic, down about 1.7% organically. And the most important growth metric for us is, of course, our operating profit, EBITDA. And there, we saw an increase of 31%, about half of which is organic, which is very strong, of course. We're very happy to present that. And it's always the same thing as before, but it's been proven a bit more in these tougher times that we have a solid and strong business model. Our focus on infrastructure is serves us well. Infrastructure is prioritized in societies around the world, also through difficult periods as the pandemic has been. And our margin increase continues. And it's, as always, apart from acquisitions, but it's also an effect that we focus on strong market positions that continuously when our business units grow in those positions, we also have the opportunity to increase prices and our profitability. So we're very happy to present this quarterly report. We can move on to Slide number 2. The agenda for today, a short business overview and then an update on the market situation related to the corona pandemic. And as the 3rd point, we walk through the current trading and also present to you the 2 acquisitions that we have done over the quarter. We can move forward to the next page, number 3. And as the as an overview and introduction to StifTech, we are a technology group with focus on infrastructure. And as of this quarter, our rolling 12 months, our net sales is at about SEK 1,900,000,000 Our profitability margin operating is increasing quarter by quarter. It has increased in this quarter as well, currently at 15.7%. The most important growth metric is, as I said, our profits, profit growth. We have a financial target to grow our operating profit. Over the last 12 months, we've seen growth at 41%. Very happy to present that. And that is a result of a combination that we have a strong organic profit growth within the group, but then that we, on a continuous basis, add growth through acquisitions. So that's part of our business model. After the two acquisitions that we have done over the quarter, we are at 33 business units. We started off the quarter with 32 business units, and we've acquired 2. 1 of the business units that one of the companies that we acquired will be integrated into an existing business unit. And I will come back to you with regards to that. And the development is strong in styptic. And even though we have a pandemic in 2020, we will stick to our financial growth goals for 2020. So we're happy to also confirm that. Moving over to next page, number 4. So our position and offering to the market is to provide technical products and services to critical needs within the infrastructure sector. And there, we have a strong underlying growth, not only during difficult times, but also over longer term. Infrastructure is a prioritized sector for any modern society. Our business model is to acquire and develop small companies. And as and the third point there is important to us. For us, it's very important to acquire but also develop our companies towards strong market positions. A strong market position, the way we see it is where you have a unique offering, the competition is weaker, lower, and the offering towards the customers are highly valued by our customers. So we are also able to price our services and products in a good way. So that is core of our overall generic strategy. The decentralized structure is also important part of our business model, and it has proven to be extra strong through this tough period. The decentralized structure enables us to make business decisions in each business unit. And of course, a situation like a pandemic hits our business units in a very different way. So the model is very flexible in that sense. And through strong leadership in each business units, we have been able to make swift and effective decisions depending on the current situation at hand in each business unit. Moving forward to next page, number 5, an introduction to our 3 business areas. Water and Energy, Special Infrastructure Solutions and Property Technical Services. Starting from the left, water and energy, their typical customers are, on the water side, water treatment plants. Typical customer is a municipality, but it can also be smaller communities. On the energy side, typical customer is energy company. All in all, the customers are strong and stable. The profitability margin currently at 20%, about roughly onethree of the operating profit, a solid and stable area. Move over to Special Infrastructure Solutions. There, our customers are There, our customers are typically in the air and climate control area. Customers are typically property owners. For the safety and security area, customers are typically municipalities as well, but typically solutions for public spaces, for instance, the rail industry. And in the transportation area, we have done 2 new acquisitions, and we will get back to those present those a little bit more. This Specialty Infrastructure Solutions business area is our fastest growing at this moment, and that is really due to acquisitions over past 12 months. We have an active focus on acquisitions in the water and energy area as well. So over the time for the time being, there are not so many, but there will come more in the future. It is a focus area for us. For the Special Infrastructure Solutions area, the profitability development has been very strong due to contributions from recent acquisitions, but also that we have strong market positions and organic growth also creates increased profitability. So there, we will increase our guiding for the year for the to 22% to 25%. So the full year numbers 2020, we increase our guiding to 22% to 25%. So currently at 26%, a bit higher than what we expect for the full year. Bengt will come back to you to describe more about the profitability dynamics over the past quarter. The property technical service area. Customers there are typically property owners. We provide technical services to our customers there. The business model is slightly different in this area. It's technical services, so it's more labor intensive. The other areas are more constitutes of products based business models or product based in combination with services. However, in the Property Technical Service area, it's smaller in terms of profits. We have, over a couple of years, not prioritized this area in terms of acquisitions. However, we have prioritized in terms of ensuring good and strong profitability. So we have focus, continuous focus in this area to ensure profitability. Currently at 8% over the last 12 months. Our aim there is to be between 8% to 10% in terms of profitability. Moving forward to the next slide number 6 and move forward to next slide after that one, number 7. I'll walk you through briefly the effects from the corona pandemic. We have carefully monitored all our business units on a weekly basis starting off in March to really understand the effects. 1, first of all, for us is really to understand for each business units what the understand where on the curve, if you say so, the our business units are, but also our group as a whole. And we've also decided to disclose one of those KPIs to the market. It's the delivery KPI, and it measures the percentage level of delivery of the orders that was planned for the group. So it can it's close to what we internally use as the budget for each business unit, but also for the group as a whole. And starting off in April, we had 85% in total effects, and the effects were typically of the characteristics that due to the restrictions in the societies, we were unable to actually come out to client sites and do our work. So 85% there, but that was not the typical characteristics of that we lost sales. It was more in the sense of having delays. This also means that we have built up a backlog of deliveries that we have started to catch up currently. So we started off at 85%. The restrictions started to ease in our markets. So we were at 90 percent in the beginning of June, and this positive trend continued. And we were at 95% in the beginning of July. And Sweden has been a market where restrictions have been slightly different compared to other markets. So our delivery KPI has been quite stable there, currently at 95%. In the UK, restrictions have been a bit stronger or quite substantially stronger. Due to the lockdown. It has been difficult for some of our business units to do their work. But it has gradually improved, so moving from 70% through 80% and current at 90% of our planned delivery. Germany, Austria, Norway, smaller markets for us, but the effects there currently are insignificant actually. So that's very positive. All in all, 95% currently compared to what we planned for the group. Moving forward to the next Page 8, just to fill in some additional information. So we do have decreasing negative effects, a positive trend. The underlying demand is good. We've also seen some increased sales in some areas, but overall, solid and stable. We also did some early actions in the beginning of the year when we saw the signs in China to build inventory, and that has served us well. So we have been able to deliver with not so many issues in terms of our supply chain. And we've also started off quite early to take actions to reduce costs. We didn't really know the exact effects on the pandemic, so we worked actively to improve cost efficiency. And some of those improvements, they will be maintained. However, we've also made some we've hold back some investments in terms of organizations and in terms of product development. Those investments, they are long term important to us. So we will start to do those investments over the second half of this year. So some extra profitability used to cost extra cost efficiency in the quarter, and that over profitability will slightly go away. So when you look at our numbers for the 2nd quarter, the profitability currently is a higher than what you would expect it. And the guiding that we present for the business areas, that's what you should aim for in terms of the full year. That's at least what we are aiming for. Further ahead, it's very difficult to predict what the political decisions will be, of course. That's impossible for anyone to do. But due to our focus on infrastructure, we are confident about the long term outlook, and we have begun to catch up on the delayed deliveries. We will do this catch up in the second half of twenty twenty, but the catch up will continue in 2021. So that's the profile of what we believe. The backlog is quite long, so it takes time to take care of it. So some catch up in 2020 and some catch up in 2021. And based on our knowledge of the current situation, we stick to our financial goals, as I said, also for 2020. So moving forward to next Page, number 9. I hand over to Bengt. And also, I think we can now move over to Page number 10 for Bengt to walk through an update of our financial targets. Yes. Thank you, Jacob. Right. We also issued a press release yesterday evening about our updated financial targets. And the targets we have had was set some 3 years ago in connection with the introduction of our B share on the stock market and was valid at that time for the stage our group was in. Now we have developed through the years, and we want to then focus on 3 of our previous financial targets. We think they are the most relevant and also the best to guide us into the future. 2 of them are actually not different from what they were from the beginning, and that's the organic earnings growth. It's still 5% to 10%. And also the acquired earnings growth, we still say that we should acquire a profit EBITDA of SEK 90,000,000 per year. We never know when those acquisitions come, but we as we said, we have done 2 during the quarter. First for this year. And the 3rd target on this slide of the capital structure is slightly updated from previously. Now we stress and focus that it's our financial net debt that should not exceed 2.5%. Previously, it was stated that it was our total net debt, and that should be 2.5%. And as we have developed, as you know, our acquisition model, we put a lot of focus to share risks, both upsides and downsides, with our entrepreneurs and the sellers of our companies. So and because of that, we have to in the accounts, we have to reserve for future payments on due to these conditional considerations, and that debt is quite substantial for us since we are mainly consisting of newly acquired companies, almost as much as our financial debt. And but those conditional debts are then very much related to the profit levels and also aims at the higher profit level than currently. So there has been a lot of misunderstanding or confusion about those numbers. So we thought it could be a good idea to straighten this out and have a simple and more straight target, which is the financial debt, debt, that is debt from banks, financial institutions and also perhaps in the future from the financial market like bonds, etcetera. And so that's really the updated target. We also then previously had some other targets relating, for example, to our return on capital employed. And that's really a measure on, you could say, the acquisition multiples we use since we include goodwill in our capital employed. And we think it's more better and more easier to understand our growth when looking at much earnings we should acquire than to focus on the capital employed. But it's, of course, still an important KPI, and we still will disclose that and we follow that carefully, but not as a financial target. And we also have a target for absolute numbers of profit levels that were set some numbers some years ago, but still, we think the growth targets are more important. So we stick to that too, organic and acquired growth. And lastly, we had a 6th target with a dividend policy, and that's actually a dividend policy, perhaps more than a target. So we have then said that that's an unchanged policy, but we don't call it that target. So all in all, 3 financial targets that we focus very much on and we intend to deliver on those targets going ahead. Then turning to next Slide number 11, and that's our financial development quarter by quarter on a last 12 month basis. And as you can see, we have had a steady pace of increasing both sales and profits. And also, as Jacob mentioned, this quarter, we have improved the EBITDA margins quite substantially. Also some of those are perhaps not everlasting effects, but still, as you can see on this slide, we have a very stable and positive trend on a 12 month basis. And our turnover increased in total 16% the last 12 months and profit levels than 41 or profits 41%. Now our EDTA star is about SEK 300,000,000 per year. Going to next slide, number 12. Some KPIs then for the quarter and the last 12 months. Net sales for the quarter increased 15%, of which organic was slightly negative with 1.7%. We have some currency effects. It's negative for us right now because of the British pound mailing, which has decreased almost 10% since end of March, which, of course, hits our numbers. And also, as you may have noted, it hits our bottom line earnings per share since due to accounting rules, we have to consider the unrealized currency effects on our internal liabilities between our companies, even though in the balance sheet, it's netted out. But in the results, we have to take a loss at this quarter, but it's unrealized. So it's not yes, let's see what happens in the future, and we take measures, of course, to reduce the effects as much as possible. But it's hard to in the long run to make sure that the currency effect does not hit the results. So hopefully, this will not be so much in the future as it was this quarter. And if you look 12 months back, the currency effects have been more or less 0 for the group. Some other numbers on this slide. When mentioned the EBITDA growth, 37% in the quarter. And of those 37 percent, we had an organic profit growth of some 15%. Sorry, just a margin, 17%. The profit growth was 15% organic and 31.5% profit growth. Looking at our cash flows. We had very strong cash flow during the quarter. Some of those effects come from possibilities to withhold tax payments, for example, but that has not been utilized so much. But still, there's some effects on that, but it's also an effect from working with the operating capital and, of course, a good profit level in the companies. Our net debt to the banks or the financial net debt, as we will call it, it's now SEK 1.13 billion, and the total net debt through our rolling 12 billion EBITDA is SEK 3.04 in the ratio. So we can turn to the next Slide 13. There we go into the business areas, and we start with the Water and Energy business area. And in this business area, all units are comparable versus last year. As Jacob mentioned, we haven't done any acquisitions in the last 12 months. And the sales decreased all in all by 12%, and also the EBITDA decreased with 4%, but it's still, we think, when looking at that we have some UK units within this business area, that it's still very good performance. And as mentioned already that some staff have not been able to do their work, but it has eased up towards the end of the quarter. We saw, however, some increased profits in some units, especially in the Power and Energy subsegment, while some companies within the Water and Sanitation had some reductions in their profits slightly. But we stick to our guidance about the margins, 17% to 20% on a full year basis for this business area. Turning to next, Page 14. We look at the Specialty Infrastructure Solutions. Also, as Jacob mentioned, this is a very strong growing business area. We have done some acquisitions through the last 12 months, and it has a strong sales growth, almost 40%. However, in the comparable units, it was slightly negative. Also then, still we have 3 units that are in the UK in this business area, 2 of which is considered organic. So it's still very good performance, we think. And especially within the Air and Climate Control, we had good contributions to the growth. But of course, the acquisitions made the biggest effect on both the sales growth and profit growth. The EBITDA actually increased 100% compared to last year and which is very glad to see that 40% was in comparable units. And that's also very much depending on the cost efficiency, but also on the underlying market demands in some of the business units. Here, we have perhaps, though, compared to the other business areas, seen the least effect from the COVID-nineteen. Here, as I also mentioned, that we increased our guiding and that's from coming from the 20% to 22% on ADITA margin. We have increased that to 22% to 25% due to the acquisitions and the strong performance. Right. We can turn to also the next Slide, number 15, which is business area Property and Technical Services. Here, as you see in the graph up to the left, that it's very stable development throughout the years and quarters. And however, in the quarter, we have increased the profits somewhat, some 15%, even though sales decreased. So that's increased the profitabilities and also increase in the units that have a bit higher margins in the business model. So for example, good order intake in our company working with shell completion for commercial and public properties, for example, have been very stable demand. But also some of the elevator business have shown good numbers during the quarter. So we actually had a profit margin of 10% in quarter 2, which is higher than the last 12 months, but we're at 8.3%. But we're guiding in the 8% to 10% for this business area, and it's as you can see also in the graph, it's still it's very stable, that profit margin. Yes, that was from the business areas. And then perhaps Jacob will take on from next Slide 16 with the acquisitions. Yes. Thank you. Okay. So Page number 16, summary of our acquisitions. The graph shows the historical development over time. And the status of this for 2020 is we've concluded 2 acquisitions so far. And we haven't been waiting. With regards to the corona pandemic, we have not been waiting for a different market state. We have a dedicated team working with acquisitions, and they have still been 100% focused on this work. So we have continued our systematic work to identify interesting and profitable companies within the infrastructure sector. So in that sense, our acquisitions work continues as normal regardless of the market state. And we're happy to present 2 acquisitions, Hiltep and Stockholm Radio. I will present to them shortly to you. Also an important activity for us, the directed share issue that we concluded in June, where we raised approximately SEK 315,000,000. So for us, the reason why we did this was, on one hand, of course, to broaden our shareholder base. But another aspect was equally important to us. Our financial goals are calibrated, as Bengt said, And the our growth pace in terms of acquisitions, the target there is calibrated with our goal for financial net debt. And in periods, we have a higher acquisition pace, which in turn brings up the net debt temporarily. So that has, to some extent, been limiting our work. So this issue and capital raise gives us more flexibility to do the acquisitions when the opportunities actually arise. So that this was an important activity for us in terms of growth. Moving over to the next page, number 17. So HILKIT, so we concluded this acquisition in the quarter. And Hiltep is a leading supplier of road maintenance products. And the picture there really illustrates in a good way what type of products. So it's typically snowplows, but salts, spreaders as well. And Hilltip is one of Europe's leading manufacturers. I've been talking previously about strong market positions and so on. And Hilltip's position is definitely strong. They are profitable, about SEK 2,500,000 of operating income pretax. It's about 25% operating margin. And the position is directed towards smaller vehicles, as you can see in the picture there, and the need for road maintenance changes over time and the need to take care of smaller roads, such as bicycle roads, for instance, is changing. The requirements there are increasing for pedestrians as well. So the smaller vehicles are growing compared to the traditional road maintenance of larger highways and so on. So the position is towards smaller vehicles. The products, they are advanced. The hardware is very good and durable. But there's also important software that comes together with the hardware to steer and control the amount of spreaders, for instance. The driver uses a software monitor to control how much salt and spreaders to apply in each single moment. And the requirements from the customers, which is typically municipalities, are strong in terms of the quality of the Salkind, for instance. So it's important for the drivers to really present that they have done their job in a good way. So the software also tracks and logs the GPS position and in which roads, at what time and to what amount of spreader that has been applied. So it's a complete system of hardware and software that is highly competitive. Moving forward to the next page, Stockholm Radio, RB, they offer radio coverage for the coastal radio. So any of you that have a boat of your own perhaps or you have had the signal to get in touch with Stockholm Radio is Stockholm Radio, Stockholm Radio. So we are very happy and proud to having the opportunity to acquire this company. The company is quite small. It generates SEK 1,700,000. And what we have done here is that we have actually acquired the contract for the Stockholm radio contracts, for the customer contracts and also the permits from the authorities. We will combine these contracts with our existing company, which is called Stow Radio, and that is an acronym for Stockholm Radio. So our existing company is provides radio communication for commercial airlines. Our existing companies, they're also the single supplier for this part of the hemisphere. And we have an operations control center there, and we will coordinate the also the coastal radio together with the air radio in the same operations control center. And the name of the companies, they are similar, and that is because they have the same origin. So we are happy to bring them back together again. And normally, we do not integrate companies when we do acquisitions. But in this case, it made sense to integrate the contracts into the same operating control center, and it's, in that sense, highly value adding. Okay. So 2 acquisitions completed in this quarter. We continue our acquisition work in a systematic way with our in house team also for the future. And then moving over to the final page. We don't need to repeat the information there, but we could leave that as the final page and also open up for questions. Thank Our first question comes from the line of Frederic Nielsen from Redeye. Please go ahead. Hello. Filipe Kingston from Redeye here. One question regarding the delivery rate. Despite of you being able to deliver about 80 5% to 90% of the planned orders, Junde lost 2% in organic revenue. How is that dynamic working? Okay. So the planned work corresponds to our budget for 2020. And of course, we continuously work to increase sales. So the budget is higher than the previous year. So when we are at 85% of planned deliveries, 85% of our budget, but the budget is higher the previous year. So the and the organic growth compares to the previous year. So that's how it works. That's the dynamics. Okay. Regarding Property and Technical Services, you grew almost by 10%. Was that mainly related to the shell completion? Or did you catch up on some elevator services as well? Thanks. Yes. The shell completion business, a company called Castella, has improved their business compared to last year. So that's one of the main contributors. But we also had some improvements in 1 or 2 of the elevator businesses as well. Okay. And very strong margin in fees. Are there any businesses seeing a positive effect from the corona situation? No. Well, you could see, for example, that the demand for secured communication increased during the pandemic because more people are working from home. And so many companies set up rules that their video conferences or phone conference must be over secured lines. And that, of course, benefits our business. But apart from that, it's no real big effects on the demand side. Okay. The increased guidance in is that mainly a result of the strong first half of twenty twenty? Or do you see a sustainable improvement in the segment? Well, look, because of the acquisitions made within the business area of Special Infrastructure Solutions, We have acquired companies with very good profit margins. So of course, that is to be stable over time. But as we said, we had some extra boost in the margins this quarter because of cost efficiency. Okay. And as you mentioned, there are you may different cost cuts, some sustainable, some unsustainable. Could you give us some approximation about the mix, how much is sustainable and how much is not? No, I'm sorry. We don't have that figure that we could. But I think a good way there, Fredrik, is to look at our guidance for each business area. That's perhaps the most effective way for everyone to understand the end results over the year. Okay. Thanks. That's all for me. And the next question comes from the line of Jon Hultner from Interfunder. Please go ahead. Good morning. I'd like to start off with some questions on the margins. If we start with the Water and Energy segment, Here, I understand that all units here are comparable, so no new acquisitions from Q2 last year. And sales were down a bit, but even excluding this, we received grants, the margin drop was fairly small to 18% from 19.3%, if I read it right here. How come the leverage on the downside isn't bigger? Have you really put the brakes on all costs? Or have you done anything else, rates, prices or something? If you could just explain a little bit on the water energy side. Well, we could say that, for example, that we have a few units which has had very good performance in the business area, which also had good profit margin historically. So even though perhaps the profits have decreased with 4 percentage overall in the business area, some of the high margin business has been performing quite well. And of course, that is supporting the margins within the total business area. For example, our company working with water treatment products have been selling disinfectants during the spring and have a good boost from that. But yes, I would say it's mainly because of the high profit margin, these units that have contributed more in relative terms than the ones that have a bit lower margins. Okay. These high margin companies in the group, have they in the segment, have they delivered in line with what they had before? So steady margin there. And so it's mainly just the mix of the high margin companies growing faster. Yes. Right. Okay. And more or less the same question for Specialty Infrastructure. Even here, it's a pretty remarkable increase in margin. But here, you had some new units boosting it or improving it. But underlying, how was the plan here? Yes. I could say similarly as for Water and Energy that high margin businesses have continued to be high margin and even increasing a little bit. And here, you also have in absolute profit levels an increase of 40% and for comparable units. So actually, across I would say across the whole business area, we'll have very good performance this quarter. How much have you pushed on the brakes on all types of costs? You mentioned it in the report that you will be more less restrictive on forward like R and Ds, etcetera, expansionary costs. So how much of this had an impact in the quarter, if it's possible to say something there? We're consisting of 33 smaller business units. And of course, for them, if they on the hiring of a new salesperson, for example, that is, of course, a boost in margins in the short term. But eventually, we have to employ that additional salesperson in order to be able to fulfill the goals. So it's more on that smaller level, if you say so. And R and D, we don't have much actually because most of the development is related to customer projects, customer demands. So we don't have very high budgets for that. But of course, some cost as well, especially external costs then related product development could be a little bit postponed. But yes, as Jakob was mentioning, it's more our guidance that we can use as a reference for what we believe going forward, the profit margins. And then on your cash flow, which also was very strong in the quarter, big working capital release. Was that also did you really emphasize to your subsidiary that they should really focus on cash in the quarter and maybe some of this will reverse going forward? Well, yes, oil will reverse, I don't know. But you could say that perhaps at end of March, you had some customers because of the unsecurity was perhaps bigger in the society towards end of March than compared to now, at least from the financial view, which meant perhaps that some customers didn't pay towards the end of March. They have now paid. So the decrease of operating receivables have affected this positively. And while operating liabilities have also increased and that consists, for example, then of these tax payments that you could postpone a bit, at least here in Sweden, but that's not all of it. So some of that will be, of course, then reduced in the coming quarters of the rest of the year. And I guess it's very hard to be on this very high cash conversion levels forever. But yes. So you could see you expect a reduction on that in the coming quarters. To more around the normalized level that you've been at? Yes. Exactly. Okay. And then just finally on this financial negative unrealized valuation effect or what it was. It's noncash now. If everything stays the same, will this be a cash cost eventually? Or could you just say something more about that, please? Yes. It's more that we have since we are acquiring companies, for example, in the U. K, we make internal loans between the different holding companies. And even though they are netted out in the consolidation, eliminated in the balance sheet, the effects from a Swedish kronor perspective have to be booked whether up or down, and now it has been hit on the downside and because of the British pound. So of course, if the currency would stay at this level, they will eventually be realized sooner or later. It also And if it's an internal loan, I mean, if it's an internal loan that's netted out, the higher cost on one end will be offset by a lower cost in the other end. So how could it underutilize that to be cash negative? The borrower in U. K, our internal company in U. K, they don't have a currency effect because they are borrowing in pounds from Sweden, and they are then acquiring then a UK company in pounds. So they have a zero effect on their side, but the Swedish parent has a negative effect on the claim, so to say, on the UK holding company. This is a negative change. But you borrow sec to acquire something in pounds? Partly, yes. We also have pounds external loans in pounds, but not as much as our assets and internal loans in pounds. So that we will, of course, look into if we could change that a little bit to offset more of these effects. But when we take, for example, dividends from our holding companies, this will be then realized when we do that. All right. Okay. Thank you. As there are no further questions, I'll hand it back to the speakers. Okay. Thank you very much for listening, and we look forward to taking another call with you in quarters to come. Okay. Thank you, everybody.