Good morning, and welcome to this conference about the news that we announced this morning, and the plans for SSAB and Rautaruukki to combine. My name is Maria Långberg, and I am responsible for corporate communication in SSAB. First, some practical details. This conference will be live-streamed over the internet, and also it will be available on both companies' websites after the presentation today. Following the presentation, there will be time for questions and answers, and that goes for you here in the room, as well as those of you who have dialed in over the phone. We have printed copies of the presentation and the press release at the back of the room, so if there is someone who didn't see that when you arrived, just wave with your hands, and we will make sure that you get a copy.
By that, I would like to hand over to our Chairman of the Board at SSAB, Mr. Sverker Martin-Löf.
Thank you. First of all, most welcome, everybody, to this presentation. I would like to start to present our guests here today, Chairman of Rautaruukki, Mr. Kim Gran. He will come and give some address after me here. And, we have Martin Lindqvist, well-known CEO of SSAB, and he will also be the CEO of the combined company. Well, let me say a few words just to start. The background to this plan that we have presented today is very much stemming from the environment we are living in. After the financial crisis, it's no doubt that the situation in the steel industry has been very challenging. The consumption in Europe dropped quite significantly, and there has been a structural change.
Many manufacturing companies has moved to Asia and elsewhere, and the recovery is very, very slow in Europe. This has created a significant overcapacity in the European steel industry, but it has also been further worsened by the continued expansion in Asia. And as you all know, China has gone from being a buyer to a seller of steel on the global market. Unfortunately, the close down of very environmentally weak plants in China is going very slowly, and we had hoped for a quicker restructuring in China, but that seems to take time. In this environment, the competition has been very tough in Europe, and is today, and prices has been under pressure for a long time. Raw material costs has been quite high, and we have a not very efficient raw material market that we are acting in.
This has put the pressure on us and all other steel companies to look for improvements and ways to get our costs down, become more flexible, et cetera. We have, on top of all these global challenges, also the European policies in, say, the environmental sector. Europe has ambitions to go before in carbon dioxide emissions, and that's something they want to do in a global market. If we get tougher rules here than in other parts of the world, one are, in fact, restricting production in perhaps the best-performing mills, and the world get even more carbon dioxide. To do those things without the global and international agreement is pretty useless. Then we have our local problems up here in the north. High ambitions from politicians, for example, the sulfur directive is going to increase our cost for sea freight significantly here.
We have, at least in Sweden, no real energy policy, and we have very poor infrastructure, systems, especially on the railway system in Sweden. So there are a lot of costs that we have to cover in a global competitive market. So the whole thing is to find ways to really make significant improvements in our cost structure, and that's the background to this proposal today. We have also agreed with the main owner of Rautaruukki, Solidium, which is the state-owned arm in Finland, how this deal should be structured. It is a 20% premium offer with SSAB shares to the Ruukki shareholders, which we feel is in line with many other similar transactions that has been done on the Helsinki stock market.
We have also agreed with Solidium that Industrivärden will remain as the main shareholder of the combined company in the future, and we have, for that reason, primarily made an offer with B shares, but with some A shares, which also gives Solidium 10% voting power in the new company. I think these are the main things behind this. One thing I would like to mention also is that we, during a pretty long period, together with Rautaruukki, has developed an industrial plan, which both companies is behind, the main owners are behind. We have a pretty clear picture on how we are going to address the plan going forward and to explore the synergies. As soon as the EU process is finished, we will be able to start up very quickly to accomplish this.
Well, Martin Lindqvist is going to give the more detailed presentation of the project, but, I would like to turn to Kim Gran, and perhaps you would like to say a few words on how we feel about this plan. Please, Kim.
Thank you. Okay. Well, first of all, I'm very pleased to be here, and I'm talking to you on this very special occasion. And Sverker Martin-Löf already quite well described the background on the markets and the synergy potential of the company, so I won't repeat that. But when looking at what we have been doing in Ruukki during the couple of last years, we went through quite a lot of restructuring in the company, reorganizing the operations. And we've gone through quite a lot of productivity and saving programs, as you may know. And I know that SSAB has done the same. But there is, of course, a limit to how much a company can save on its own.
By combining these two companies, we see great potential practically in all fields of operation, regardless of where, what we're looking at. When we look at sales opportunities, market positions, the industrial platform, R&D, our skills, personnel, and so on, we believe that this is highly synergistic. What we have described in the press releases as a potential of roughly EUR 150 million per annum, I believe is achievable. I believe that there is still quite a lot or more potential to come when we combine the best efforts and the assets of both companies. When looking at the alternatives, in the board, of course, we've gone through various alternatives for Ruukki.
Looking at continuing as a standalone company, looking at various options for combining forces with companies. But we feel that the combination with SSAB is natural, very logical, and a very good opportunity for both companies to create value for our owners, which is, of course, the main job of any board. And I'm glad to say that the biggest owners on the Finnish side, Solidium, and also the two other, like, big, important owners, Ilmarinen and Varma, are supporting the deal. So we warmly recommend as a board, unanimously, that everybody, all the shareowners, like, support the deal, and then we can start working together as soon as possible. Thank you.
Okay, thank you very much, and good morning, and warm welcome to this press conference. I will try to guide you through and give you some more details on what you have heard from the two chairmen of SSAB and Rautaruukki. First, to start with, this is a deal that will... The combination will make us more effective and competitive together. The value creation is mainly about tangible, hard cost synergies, increased flexibility, and cost effectiveness. The combined company will also have a global position and product offering within especially high-strength steels, but also positions within heavy plate, standard strip, and tubular products. The offers, as you heard, are recommended by both boards of directors and supported by the main shareholders of both SSAB and Rautaruukki.
The synergies we are looking to here is annual cost synergies of up to SEK 1.4 billion, and that corresponds to 2 kronors per share in the combined company, fully diluted. And to put it in perspective, compared to a market estimate of an EPS of 1.20 krona 2014 and 3.20 krona 2015. To give you a brief background, SSAB, as many of you know, is a Sweden-based steel company with production in Sweden and in North America, primarily. We are divided into three business areas: SSAB EMEA, with sales in 2012 of just north of SEK 20 billion. EMEA is a producer and supplier of high-strength steels globally, Q&T, and advanced high-strength steel, and also producing standard strip and standard plate, mainly for the European market.
SSAB Americas, with two sites in North America, is a commercial heavy plate producer, but also with capabilities within Q&T. The third and smallest business area within SSAB is SSAB APAC. That's sales and distribution of high-strength steel, both Q&T and advanced high-strength steel. We also own a Nordic distributor, Tibnor. Rautaruukki is also a global company with main production sites in Finland. They are divided today within three business area: Ruukki Metals, Ruukki Building Products, and Ruukki Building Systems. Ruukki Metals, the biggest business area, with net sales of just below EUR 1.9 billion, is focused on producing special steel products, standard steel products, tubes, and profiles. They also have a distribution arm for stainless and aluminum.
The second business area in Ruukki is Building Products, with sales of approximately EUR 450 million in 2012. They are focused on residential roofing, building components, infrastructure, and construction components. Then Ruukki Building Systems, with net sales of just below EUR 300 million, focus on functional building systems, mainly in the Nordics region, Russia, and Central and Eastern Europe. Together, we have approximately 8,700 employees in each company. As said, this combination follows a very strong industrial logic. It's about creating a flexible production system, I will come back to that in some more details, but also a cost-effective production system to be able to better adapt to different market demands over time.
The value creation is through tangible hard cost synergies, and there is also a good possibility to continue to accelerate the growth in high strength steels and for other products. We really combine two companies with a shared strategic direction, and we will continue together that shared strategic direction. This will also enhance our ability to continue to invest in product development and R&D, and we will combine the two innovation-leading steel companies, and by that, forming a more competitive Nordic and U.S., U.S.-based steel company. This is a schematic picture showing how we complement each other or overlap each other when it comes to product offerings and also geographical presence. We will, together, have a more broad geographical coverage, but also a more, a broader product portfolio.
This is a site or a map showing the world, and as you see, together, we will be present in all major steel-consuming areas of the world. We will have production sites, 2 integrated mills, minimills in North America, and 5 sites in the Nordic region. In the Nordic region, that is from SSAB's side, our steel shop and steel slab producer in Luleå, where we make steel and slabs. Our rolling mills and finishing lines in Borlänge, and our integrated mill in Oxelösund, with both blast furnaces, steelmaking, and production of quench and temper. In Finland, we will have the integrated mill in Raahe, with steelmaking, heavy plate capabilities, and strip products capabilities, and also in Hämeenlinna, strip products and tubes. So we will have 5 major sites in the Nordic region.
As said, it's flexibility and synergies that will create the value in this combination. When we talk about flexibility, we will have a larger asset base to better adapt to different market demands. We will have five blast furnaces of different size, two hot strip mills, two cold rolling mills, and two plate mills. We will also have the ability to have a better distribution system to serve in a better way, both small and larger customers. When it comes to the synergies, there are, of course, big production synergies. It's about line specialization, and also the flexibility gives us the possibility to reduce under absorption costs in the production system. There are things within energy and fuel rate optimization, but there are also non-production synergies, like distribution synergies, purchasing, administration, and overhead.
This is a schematic picture showing the blast furnace fleet of the combined company, and as you see on this picture, we will be able to, in a cost-effective way, have a production of between 6.5 million tons down to 3.5 million tons. So the combination of these two companies will give much more, a much more flexible production system compared to the two companies standalone. The annual cost synergies of SEK 1.4 billion, as said, 1.4 krona per share, and the synergies corresponds to roughly 3% of the cost base in our two-- in our combined European system. There is, of course, an estimated reduction of headcount in, in this, in these synergies, and in the industrial plan, lays a reduction of headcount of approximately 5%, mainly in Sweden and Finland.
Of course, there are some one-off costs to achieve these synergies, and the one-off cash costs amounts to SEK 350 million. Out of the total annual synergies, SEK 350 million is dependent or will be achieved in periods with lower market demand, as I showed on that schematic picture. In addition to hard cost synergies, there are, of course, the potential to avoid overlapping investments and also to continue to be more effective and reduce working capital. The full synergy capture is expected within three years. The new company have an idea how to organize, and we will organize around the business logics of the different businesses. With Quenched and Tempered Steel, a global function, headed by Melker Jernberg. European Flat Carbon Steel, headed by Olavi Huhtala. American Flat Carbon Steel, headed by Chuck Schmitt.
Nordic Steel Distribution, headed by Mikael Nyquist, and Construction Products and Systems, headed by Marko Somerma. Some words also about, or some more details about the exchange offer and some combined financial information. SSAB will issue 0.4752 A shares and 1.2131 B shares for each Rautaruukki share. The total value of the offer amounts to SEK 10 billion, and the exchange offer corresponds, as mentioned, to a premium of 20% compared to the three-month volume-weighted share price of both SSAB and Rautaruukki. This combination is value accretive for all owners, and as said, expected annual synergies post-tax amounts to approximately 2 SEK per share, so SEK 1.4 billion. There are, of course, some key conditions in this proposed combination.
We need acceptance from more than 90% of Rautaruukki's shareholders, and the main shareholder in Rautaruukki, Solidium, have expressed its full support for the offer, and they hold 40% of the votes in Rautaruukki. They have also undertaken to accept the exchange offer. The AGM of SSAB must pass the resolutions necessary to implement the combination and the exchange offer. And as heard earlier today, the main shareholder in SSAB, Industrivärden, has stated its full support for the offer, and they hold 23% of the votes in SSAB, and has also undertaken to vote in favor of the resolution necessary to implement the combination and the exchange offer. The transaction is, of course, subject to regulatory competition approval in the European Union and a limited number of other jurisdictions like Belarus, Turkey, and Ukraine.
The combined company will have its primary listing in Stockholm, and we will also apply for a secondary listing in Helsinki, and the company will be headquartered in Stockholm. This is a pro forma ownership, and I think both Kim and Sverker mentioned this. This is a pro forma, how it would have looked at the end of last year. Current SSAB shareholders will hold 75% of the votes and 58% of the capital, and current Ruukki shareholders will hold 42% of the capital and 25% of the votes. Industrivärden has stated that they intend to remain as a long-term main owner of the combined company. This is some call it pro forma figures to show the magnitude of this new company. 2012, we would have together had a...
turnover of a bit more than SEK 60 billion, with an EBIT of SEK 977 million and a strong operating cash flow. We are all together 7,500 employees, and we will have a solid balance sheet with a net debt-to-equity ratio of 59%. So the key takeaways from this short presentation before we open up for question is, this is we are creating value for all shareholders, and we are doing that through tangible, hard cost synergies and improved earnings potential. What this is very much about is increased flexibility, increased cost effectiveness, and improved capital efficiency. We will be able to together strengthen the customer offering to continue to be the innovation leader in the steel industry. We will have a broader product range and an increased geographic presence.
This is an active move to create a more competitive steel company, and this is also a way of creating a long-term competitiveness in an industry vital to both Finland and Sweden. We will secure an important export industry. We will also secure job opportunities in the long run, and we feel that together, we can, as a combined company, move faster to the vision to create a stronger, lighter, and more sustainable world. Thank you.
Okay, so now we will open up for questions, and I would like you to state your name and where you come from, and also please state one question at a time. We will start with a few questions here in the room and then take a few questions from the phone, over the phone. So please. Yes, you can start here.
Hello, Johannes Grunselius, ABG, Stockholm. I have two question. The first question is on the competition approvals. Have you had any dialogue with the competition authorities on this one, and what... Do you foresee any obstacles?
We wouldn't do this if we foresee any major obstacle. This is, I mean, we are. It's a global steel market. We're active on a global steel market, and there is, of course, a formal process, but we have to wait and see. But we don't foresee any major problems.
... And, my second question is on the terms. You are buying Rautaruukki with 20% premium. Could you give some more color on you, how you worked out that ratio? And then, I mean, you could argue that it could be a merger of equals, right?
We have worked that out together, the two companies and the two boards, and this is, as I think, Sverker mentioned, in line with, I mean, similar transactions on the Finnish Stock Exchange. So that's the thinking behind it.
Okay. Someone else who would like to raise a question here in the room? Yeah, please.
Oskar Lindström from Danske Bank. I have a question about the part of the synergies, the SEK 350 million related to periods of weak demand. Are we in such a period of weak demand right now? And then, and sort of do you foresee these synergies being realized over the three-year period? Or is this on top of only-
I mean, as said, we expect the synergies to be realized fully within three years. At the end, of course, these synergies, call it more flexibility synergies or effects of having a more flexible production system, and by that, having lower under absorption costs. Well, if they will be fully realized or not, that will depend on the market scenario, of course. And in a weaker market scenario, they will be there, and in a stronger market scenario, we will produce more than what I showed, more like using the full production system.
Just a follow-up on the... So you mentioned that you'd had these discussions and plans... for quite a long time, and that these synergies are based on those plans. When will we have more details about sort of the, well, the details of these synergy plans?
We'll gradually have more details, but this is well worked through, and it's between our company and Rautaruukki and the management team of SSAB and Rautaruukki, so.
This is not something that you would disclose once it's been approved or, or-
We haven't decided how detailed we should be.
All right. Thank you.
Okay, let's take a couple of questions from the phone. So please, operator, state the first question.
Ladies and gentlemen, if you have a question for the speakers, please press zero one on your telephone keypad and you'll enter a queue. After you're announced, please ask your question. Our first question comes from Alexander Haissl from Morgan Stanley. Please go ahead, sir.
So good morning, it's Alex from Morgan Stanley. My first question is: Can you give us an indication what the impact will be on the Nordic market, given you have more supply control? Can we expect the premium on Nordic steel prices to return? The second question that I have is you also mentioned potentially-
Take them once at a time.
Okay, sorry.
I mean, we are active on a global steel market, and I mean, there is full competition on the global steel market, so that's how it is in reality.
Any change in the mix in the Nordic market?
I mean, the change will be that we will combine these two companies and have a much more flexible production system and better, call it, cost effectiveness that will give us the possibility to better compete on the global steel market.
The other question that I have is, in terms of, aside from hard cost savings, savings in terms of CapEx, maintenance CapEx, have you figured out, how the combined company will look like in terms of free cash flow generation? Meaning, maintenance CapEx can, can be down 20%, working capital, how much can you structurally reduce further if you optimize your assets better? How much can you squeeze out of the combined company?
As said, I mean, there is a big potential for call it CapEx avoidance, and also call it working capital efficiency. I mean, the free cash flow generation or the cash flow generation I showed you, and it's in the press release as well on in the pro forma figures, and that is what we have decided to share at this stage.
In terms of CapEx avoidance, you mean also maintenance CapEx or just gross CapEx?
Well, I would say both, but mainly, yeah, maintenance CapEx and growth CapEx.
And my last question, sorry, is on the cross-selling opportunities. Is it this one-third round about supply chain and distribution? Because then the figure of SEK 1.4 billion seems quite low, given that you are much more active on a global scale versus Ruukki. So shouldn't there be much more upside in terms of cross-selling opportunities?
There are cross-selling opportunities, and as said, we will have a broader product portfolio to work with. And as said, I'm sure that we will be able to deliver these synergies.
Okay, thank you.
Okay, let's take another question from over the phone.
Our next question comes from Carsten Riek from UBS. Please go ahead, sir.
Thank you very much. It's Carsten Riek from UBS. My one question is: How quickly could you optimize the production processes, and could that mean the reduction of capacity in Scandinavia? Related to it, could you be forced to close capacity in Scandinavia by the EU authorities? Because we have seen it with ThyssenKrupp and Stainless, that they are quite restrictive in some areas, at least. Thank you.
First of all, we can't do anything until we have combined these two companies, and that will be done after the formal process, both with competition clearance and also the owner process, and then we will start that work.
Okay, fair enough. Thank you.
Okay. Any questions in the room here? Yes. Microphone.
... Okay, Johannes Grunselius, ABG. Another question on dividend. Both companies are now not, or the board suggests no dividend for the earnings year of 2030, and I think that hasn't happened before, at least in the decade. But what, what's behind that?
This will be a suggestion from both boards to the AGM and the AGMs to decide for, but so we'll see what the AGMs decide.
It's fairly likely that the AGM will, I mean, vote for the proposal?
Yeah, hopefully, yes.
I mean, is it that you feel you want to strengthen your balance sheet, or what, what's behind this?
We haven't been very specific about that, but that is also for practical reasons now, when we are, I mean, having AGMs during the process of combining these two companies, so nothing more than that.
Fair enough. Thank you.
Okay, any more questions in the room? Okay, no. Let's take some questions by phone.
Our next question comes from Mr. David Abraham from BTIG. Please go ahead, sir.
Good morning, gentlemen. Just had a quick question. I was wondering if you could elaborate why it's gonna take another roughly two months for you to actually launch the, the acceptance period and publish the documentation in respect to the share exchange?
No, but I said, this is a formal process, and it takes the time it needs, and we have also, I mean, a plan, the AGM in SSAB and so on. So there is no real hurry for that, because we will also need to await the competition clearance.
You want to get competition clearances before you actually launch the exchange offer?
I don't have all the details in my head. It's written about it in the press release.
Okay, thank you.
Okay, another question by phone.
Our next question comes from Mr. Jeff Largey from Macquarie. Please go ahead, sir.
Yeah. Hi, good morning, it's Jeff Largey from Macquarie. Two questions. The first is on the synergies. I was wondering if you could provide some color on the three-year profile of how those synergies are realized. Is it equal, or is it more, say, back-end loaded into that final year?
We haven't been that specific, but after the combination, we will be able to gradually work up the synergies, and as said, within three years, they will be fully realized. So we haven't given any detailed time plan, but it's not fully back loaded. It will be a gradual process.
Okay. My second question is just is on, say, have you had to make any commitments to the respective Finnish and Swedish governments about, you know, long-term employment levels or, say, production? It kind of leads back to one of my colleagues' questions on, you know, if we're looking down the road, is there opportunities for, you know, actual rationalization of production, given the trends we've seen of overcapacity in the broader European steel market?
We haven't given any what do you call it? any such guarantees, and of course, there is production to continue to be more effective.
Okay, thank you.
Okay, next question by phone, please.
Our next question comes from Mr. [Julian Beer from SEB. Please go ahead, sir.
Very good morning to you. Congratulations on launching the most logical deal that I think anyone could have envisaged. I have two questions. Firstly, does your SEK 1.4 billion synergy estimate include any permanent closure of any of your major production assets or production sites?
No. The answer to that question is no.
Okay, thank you. And then the final question is: In what parts of the quenched steel product offering would you say that SSAB and Rautaruukki have been most significantly head-to-head competitors?
We have said, I mean, in many areas have complementing offers and also, of course, meeting each other on the global markets. So we are two steel companies with similar strategies. Of course, we have been meeting each other globally.
Would you say that you have been competing head-to-head on all quenched steel products?
As said, I mean, we have been competing in some product areas and complementing each other on the market in other product areas.
Okay, I won't take it further. Thanks very much.
Okay, next question by phone.
Our next question comes from Bastian Synagowitz from Deutsche Bank. Please go ahead, sir.
Yes, good morning. It's Sebastian from Deutsche Bank. I've got two questions. So, my first one is just following up briefly on the previous question regarding production facilities. Would you generally rule out any closures of production facilities, or will you basically just run them in a more focused way in terms of producing different product grades? And then my second question is-
If we start with the first one. No, we will, of course, mainly use, as what I call line specialization and use the sites in a more optimal way, of course. I've learned so much in the steel industry that you can never rule out anything in the long run, but in the industrial plan, there is no ideas of thinking behind the plant, large plant closures, and this is about specializing plants or sites and specializing lines.
Okay, got it. Thank you. And then my next question is on the company structure. You obviously gained quite significantly on your critical mass, while the two building units also had a diversifying and de-risking purpose for Ruukki. Now, in the new company structure, do you see both of the building units really as a core business, or is it too early to say, really?
Too early to say.
Yeah. All right, thank you. Cheers.
Okay, next question, please.
Our next question comes from Mr. Dustin Barsa from Bank of America
... Hi there. It's actually Steph Boswell from Merrill Lynch. Just one quick question from me. Were you able to give us an indication of what your combined market share would now be within the Nordic region?
I don't have that figure. We don't look upon it as a Nordic region. This is a global steel market, and if anything, a European steel market with full competition, so.
Okay, so you don't have an indication of what potentially it could be in the Nordic region alone?
We don't measure it that way because it's not relevant.
Okay, thank you.
Okay, next question. Next question, please, by phone.
Our next question is from Mr. Alexander Haissl from Morgan Stanley. Please go ahead, sir.
Sorry, one follow-up question on Patty's question and leverage of the company. I mean, clearly net equity seems low, but free cash flow generation is still quite limited if there is no underlying improvement. What would trigger a decision to sell off non-core assets to deliver quickly in the current market environment?
I mean, both companies has, over time, been able to, first of all, reduce the need of working capital and being more and more capital effective, and then also, over time, sold non-core assets, and that is a normal process in this kind of industry.
Okay, thanks.
Next question, please.
Our next question comes from Mr. Jean-Baptiste de Lève from Exane BNP Paribas. Please go ahead, sir.
Yeah. Hi, Jean-Baptiste de Lève from Exane BNP Paribas. I mean, there have been many questions about the market shares. Maybe I don't... I understand you don't wanna look at the Nordics as one market, but prefer to look at the global ones. So could you be a bit more specific about where you stand globally in terms of specialty heavy plates when combined with Ruukki?
As I showed on the schematic picture, we will be having a broader geographical coverage, and we will also have a broader product offering. Exact market shares on the global market, I mean, we are in the Nordic, with our production system in the Nordic region, two fairly big steel companies, but globally we are something like number 60 and 70 or something. So, I mean, on an overall steel market of 1.5-1.6 billion ton, we are, even as a combined company, very, very small.
If you look at the specialty plates, for example?
With the strategy we have, of course, globally, we are somewhat stronger on special steels compared to the full steel market, but still not extremely big.
Okay. Thank you.
Next question, please.
Our last question comes from Mr. Neil Sampat from Nomura. Go ahead, sir.
Hi there. Just a question to make sure I'm understanding the synergy target properly. So the SEK 350 million, which will be achieved in periods of low demand, is it then... I guess, is it fair to say that if there is no pickup in demand over the next few years, then rather than the SEK 1.4 billion in synergies, the total synergy number would be 350? And so the delta is really based on a pickup in demand. Is that how to understand the synergy guidance?
Yes.
Okay. Thank you.
Okay, that seems to be the last question. Any more questions from the room here? Yes, please. We'll get the microphone.
Auli Mauno from the Finnish Business Daily Kauppalehti. How about the market shares in Europe? That's what the European Competition Authority is mainly looking at.
Europe is also a big steel market, and with all respect, but these two companies, even combined, will be fairly small also, compared to the total steel consumption in Europe. I mean, you have big companies like ArcelorMittal, ThyssenKrupp, and so on, with a much stronger presence on the European market.
Okay, any more questions from anyone?
No. Then we would like to thank you all for coming and for dialing in.
Thank you very much.