Earnings Call: Q1 2020

Apr 23, 2020

Ladies and gentlemen, thank you for standing by, and welcome to the Presentation Quarter 1 Report 2020 Conference Call. At this time, all participants are in a listen only mode. And after the speaker presentation, there will be a question and answer And I must advise you that this conference is being recorded today. I'd now like to hand the call over to your speaker today, Thomas Wittstrand. Please go ahead, sir. Thank you very much, and welcome everyone to the short term description or comments around the Q1 and development for Truax. And I will more or less, for those of you who have been around before, follow the normal presentation mode. So we have something which is called the presentation of Q1, which you will find under the attroax.com webpage. And in there, you will find it under the headline Investors. And under Investors, you will find it on the Reports for the quarter 1. This presentation, I will start with a brief introduction and of Truax, which I will very quickly go through if there are any newcomers to Truax. And this presentation just starts with a few pictures done showing what we stand for, namely that we try to make the world safer, especially then within the industrial environment. And in that area, we try to do improve the safety in every aspect. After that, you will find a few brief introductory examples to one of the segments where we are mainly working. First one, which is what we call machine learning, which is approximately then 60%, 65% of our turnover here exemplifying by a picture from the core industry, which is an important segment for us. But obviously, for the Q1 2020 was not as important as it used to be in the past. The next one, which is called warehouse partitioning, and that's normally around 25%, something like that of the turnover. And as the name implies, it's our solutions there mainly consist of stand out solutions that helped making warehouses safe was from the for the people who are working there and also, of course, from purely process point of view. The third one and the smallest one, which is a little bit less than 15% normally, We're talking about property protection, which is quite important for Truax in the northern part of Europe, but of course, much smaller than in other parts of the world. And as the name implies, it's basically not safe in the same way of protecting people, in the same way you more protect property in the cellular environment where you have done your luggage or baggage or skis or whatever you have got. Then comes Automated Warehouse, which is something which is growing very much. So we try to promote that a little bit. It's actually part of the machine guarding, the products that we use for machine guarding and also for the warehouse partitioning. And this automated warehouse is growing very much and has done so now for a couple of years. And it's, of course, driven a lot by the e commerce. And as you will see, probably I've seen already from the figures from the Q1, we had for this specific niche within the segments, we had a quite good development for this kind of applications. Next page, if you follow it page by page, just to explain a little bit the year in brief for Trogax, talking about 2019. I won't go through that because you can read it there. It more or less states what I already said about the division on the segments. And you will also see geographical split where, of course, we are very strong in Europe, regardless if you call it Northern Europe or Continental Europe or whatever. And what we're trying to do right now is, of course, to achieve a much better market share, both in North America and in the Far East. Next one shows the sales development long term. Just to show you that we should continue to grow. Trox is a growth company, but now in the last 2 years, it's been a little bit less of growth. I mainly haven't been down, of course, by a decline, not only in automotive, but also in other areas. And I will come back to this within a few minutes since obviously now we are helping with a much bigger problem, which is, of course, the effects of the ongoing coronavirus unfortunately. But I'll go back to that. Next one is the financial targets. And just to make a brief introduction to that, we have 4 targets that we set up as a group to try to fulfill. The first one is talking about organic growth. And normally then this what we're trying to say is we should have an organic growth, which is higher than the market growth. And historically, we've had a market growth of 4% to 6 percent, and we have been growing over sometime 8% to 10% per year, maybe some years even bigger. And this quarter, we were growing 4% on sales, which I would say is quite acceptable, being in mind that other turbulent quarter we went through. And actually, the order intake was growing with 20%, which actually is quite a good figure, especially from bearing in mind the conditions that we were working with. There has been no acquisition or any further real changes in the group in the Q1, except that we now, of course, include the figures also on the sales side from the Japanese distributor that we acquired on January 1. It doesn't really change the picture, but just for formality, it's part of the group now. Now we should have an operating margin of 20% or in excess of that. And for the Q1, we reached, let's say, 16% or just about. Though we have a little bit lower in the Q1, and hopefully, it should improve during the year, even if now we see some clear problems with this going forward, which I will come back to. Last year, we had approximately a little bit short of 20% operating margin. So if we should reach 20% or in excess of that also in 2020, then of course, we have to do better than 2020 in the coming quarters. Next one is explaining then the net debt is relation to EBITDA, and we have a target to be below 2.5. And we are around 1.3 at the end of the Q1. So we have, as I call it, quite a stable balance sheet and a stable result development in comparison to the 3 loans that we have or the debt situation that we are in. And finally, we have the target of paying out dividend of approximately 50%. And we have a proposal of paying out 47% of net profit of 2019. However, we have, as a group, then told our shareholders that we postpone the Annual General Meeting with approximately 2 months until June 23rd, I think it is, where we then intend to keep our AGM. And this is time to give us time, the Board to give more time to evaluate on the difficult situation, which has come up based on the coronavirus situation. And we do think that if we will come through in April, hopefully then coming into May, the Board will have a better decision or the fact to take a better decision for this dividend decision. That's how it looks today. If we then go to the development for the Q1, the first page that comes along is what we call some sort of summary of Q1 2020. And if I should try to summarize it, I can say then that despite the somewhat turbulent environment, I think we have generated a stable development during the quarter, both in order, sales and in result, even if which I will explain before, there has been some issues during the quarter. We have reached a higher EBIT and margin in Q1 2020 compared with Q1 2019. And these are mainly due to that we still were possible for us to increase our turnover. And we also had, I would say, really good cost control despite the situation. It all we should also bear in mind that Q1 last year was not a very strong quarter, and we clearly had a negative impact on the following our development in the U. S, which was substantially better in this Q1 even if it's still not up to the standard that's where we want it to be. So if we then talk more generally about the geographical developments, I can say then that we see despite all the issues, we see stable and good development in all areas. Even if I would like to pinpoint in the UK development, where we had maybe a little bit surprisingly, very good development, not only in UK, but also in several export orders from the U. K, both overseas and other parts of Europe. And this is, of course, quite positive for us when we then compare with last year. There was an increase then not only of the profitability in absolute terms, but also in earnings per share. So even if it's early days, it's very good, I think, to have a good start of the year, especially being in mind that we do expect now much tougher quarters ahead due to the development of the corona lines. Talking again a little bit on the following one. We saw some clear improvement in fall and go during the Q1. But we still want to point out that on the order side, the U. S, these kind of segments we're following on is mainly working with. We clearly saw them that in March, this was being hit by a weaker demand by the customers. And this, we expect to continue now also for some time. So even if we were improving the process, both result wise and so far more operationally processes in Poland on the Q1, we saw clearly then that the order situation and the sales situation was on the weak side. Commenting on the working capital, it's more or less an expected level. Even if we have increased inventory towards the end of the quarter to be able to prepare for probably some negative effect of the effect of the coronavirus, meaning that we increased a bit the supply chain purchases in order to comply with that there could be some disruption of the supply chain deliveries from different suppliers during the coming quarters. So we have tried at least to a certain extent to compensate for that. The investments are proceeding according to plan and are actually going into more or less a finalized phase. The big one during this quarter was the complete new factory in Italy in North of Milan, which was taking into full operation. It was in principle started up 1st January and after some initial problems, which normally are connected and we'll start and starting at the full factory, I think our organization there has done a tremendous good job, not only improving then the productivity and the inauguration, so to speak, all the investments we've been doing. But I've also been able to keep the factory working during this whole problematic period where we all of us know that Italy has been, as you know, at least partly closed in many areas, but we've been managing on a day by day basis to keep the factory rolling. So I think this is something I'd like to point out that's quite positive during the period. We then talk a few comments on the general marketing situation. We can say that it was considered very stable in January and February business as usual. It was not really growing. It was showing a tendency like we already saw last year, meaning that customers were highly occupied what they were doing. So it was really on a high level, but the market was not really growing anymore. But then clearly, we saw a decrease of the demand and the increase from customers to get quotes during the second half of March, especially. It started a little bit earlier in some countries, but it was clearly recognizable by the last 2 weeks of March. So what you see here in the order development and in the result development is only to a smaller extent and affected by the implications or the consequences of the coronavirus. We've had some factory closures during Q1. We obviously have had a negative impact on the result, but it has only been for a limited amount of time. Or like in the Chinese case, it's rather small, which means it doesn't have this huge impact on the total group. But talking about this directly, I can then say that the Chinese little factories that we have in Shanghai was closed down from sometime during January and for approximately 2 months and was opening up at least in a smaller scale towards the end of March. So that was good. We can then see that, so to speak, that this loop was coming to an end. Then we had the American factory, the Olefollinger factory, which now also produces Torrex products based in Chicago. And that was in principle closed 21st March, if I remember correctly, based on clear guidelines or instructions from the Governor of the State of Illinois where we are operative. And even if the Chinese factory now started again, the American one is starting to get a little bit worked on. But in principle, the guidelines and instructions from the government, there is still that we should maintain this close until at least the end of April. So we are a little bit waiting for the instructions for how to do it in May. Also the U. K. Factory, which also is a rather small one from the group perspective, was closed here during certain period of time and is expected to be closed also at least until the end of April, probably a little bit longer based on the situation in the UK. The main production plant besides the Italian one, which is the Swedish one, has been more or less operative in a more or less normal way during the complete period that we are talking about. So no real effect there. Talk about the segments. The automotive is continuing to be a weak segment just as has been in the last, you can say, 2 years. There has been, and I think still are some indications that the automotive will let a certain step come back and start to invest further, which will help us and probably some others as well. But due to the COVID or the coronavirus, we do expect that the possible start up of further investments will be further delayed, not changed, not putting in a stop box or anything like that, probably delayed for some time due to these problems caused by the coronavirus. On the other hand, you can then say that the positive development we've had in this quarter comes down from the Helios and from the Automated Warehouse business From, as you're aware, very well aware of, is driven then by mainly from the e commerce business one way or another. And this, I think, despite of the coronavirus development, there will be continuous investments in this area, which we also saw during the Q1. I'm sure there will be some ups and downs for this type of development. We were lucky in the Q1 to get a number of these projects as orders, which means end up especially for the main production unit in Sweden in Eletranche. We have as the quarter then was ending, we had actually quite a good order backlog, which to a certain extent we think can offset and the trouble sometimes that we are expecting in Q4, quarter 2 and quarter 3, at least from a manufacturing point of view. So as a conclusion, what I already said, we do expect that based on that customers are either sitting at home, they are postponing projects or they are not at least not deciding something, which are not inevitable that they have to do. We are therefore experiencing and we are expecting and clearly decreased demand in Q2 and probably also in Q3. And it depends on, of course, as you all know, how fast the market will pick up. But we can clearly say that definitely for quarter 2 and most probably for quarter 3, we expect a significant lowering of the orders from the customers. If you then go to the next page, you will find on the summary of the financial highlights. And I think you've read this, so I will very briefly go through it, saying then again that on the order side, it was very positive. We had a 12% increase of orders, which is very good for us then based on as I said, that we have some backlog down that we could turn into invoicing in the next coming months. Sales were increasingly 4%. We had a slight increase of the gross margin. I think that's based on that we had slight increase of the turnover and no good cost control on many items. It could actually have been even better than if the volumes produced and the factors not have been affected and or by this culture that I explained, especially in China, U. K. And following around during the quarter. So I think you're seeing from that level, it is quite a okay margin. The operating profit is higher than last year and hence also the margin is higher as well as the profit after tax. Net debt compared to EBITDA is on the same level, 1.3 and no changes there. So I think those are the main ones that were really worth noting them for the Q1. Going to the next one, which is called the regional development order intake and sales. You will then find a more more specification or more detailed specification of the order intake and the sales invoice of the different regions that we report. And you will see then that is from a order intake point of view, quite a stable development, I would say, in the Continental Europe and Nordic region, a very good development in the quarter than in United Kingdom. And despite on that, the market there is it's not moving, it has the same development. I would say that on the European countries, which are hampered by the coronavirus. We also have a good development in North America, mainly driven by the TROEX brand, who has had a continuous good development also in the Q1, and it was a bit weaker than for foreigner as I explained before. On the new markets, we've seen and it's maybe a little bit too early days to say something conclusive, but we do see a little bit better activity, and we do see clearly a much better performance from our own organization, I would say, especially in China, based on the actions that we were doing during last year. So I'm sure also here we go a little bit up and down, but I have full faith in that new markets should step by step go to higher levels as we proceed quarter by quarter. So in total then, we've had 12% increase on orders, which is a quite good figure, I think, especially bearing in mind the troublesome period that was especially during the last months of the quarter. Going to sales, you will see not really maybe the same development. You see them in Continental Europe has quite a good development in sales and actually it was a minus and in the Nordic region, whereas in UK, we've had a very good increase of the order intake, didn't have the same development on the sales side. So obviously, we can say then that probably UK would have a much improved sales figure in the coming quarter. And then on North America, you can also see there that the good order intake in the Q1 didn't really manifest so much in a high invoice sales. So that is still good to come. And you also see the same in new markets. So you can say that a lot of the good order intake that we had in different areas still should be invoiced in the quarter 2 mainly and a little bit also in quarter 3. If we then try to do some conclusion on the next page, which is Lipid is repeating what was said before. But we may say something like this that there was a substantial weaker activity in the market towards the end of the Q1. But as I said before, it was quite okay January February. And we expect this negative trend short term trend unfortunately to continue, especially in the second quarter. We've had a continued low demand from the automotive industry in this quarter, which has been offset by the good development in the Automated Warehouse business and actually more than that. And to repeat myself, we think that the possible demand or increase of demand that we soon or later are expecting from the automotive industry, it will still come, but I do see now that it's been further postponed of the problems with the coronavirus. Talking briefly then in summary of the U. S. Operations, the Truax Inc. Is continuing to develop very well. And the following was improving compared with the same quarter last year, but we do need some further increase in volumes to get up to the levels where we want it to be. Very good and stable development in all our European operations. The new factory in Italy was quite successfully started up. And we've had some extra cost both in Q4 and in we had injector also in Q1, but we don't want to put that up and say anything extraordinary. But some of the costs that we had in Q1 was, for instance, some of the costs for the rent of 2 premises and that has faded away after Q1. So I think we can see that. From a cost point of view, that is quite under control. Even if we expect, of course, like I wrote in my comments also that unfortunately, the bottleneck of the factory in Italy won't be the production capacity short term. It will be the demand because Italy is one of the countries, obviously, that has been hit, of course, by the lowering demand from customers. I mentioned also next bullet, same thing which I said before. So the factories in UK and USA, United States was in principle closed from sometime during the end of March and they will at least be closed until the end of April. And the small Chinese operations has resumed operation in March after having been closed for approximately 2 months. I think those were the main conclusions then of the Q1 and then follows a number of presentations of the growth factors, which really still have not really changed for us. If anything, we can see then with these problems of coronavirus, wherever it will take us from a human point of view or social point of view. But from an automation point of view, we can do see that, if anything, this puts even higher prices and I think on many customers to continue the optimization in order to make the factories not so reliable, so to speak, on new model workforces. And this in principle is good for us even, of course, we don't want this to be caused by an negative effect of the corona virus. This is obvious. In this niche market, we are the market leader. We expect we have some 25% of the European market and maybe we are close to some 15% worldwide. And where we take market shares on is a lot, especially when you come to the southern part of Europe, you come to United States and you come to the Far East is what we take, of course, a little market share from small local competitors, Whether we call them for like smiths or not, it's really relevant to our small local competitors. And I'm happy to say that development is still continuing that we can see it and that customers are demanding a highly more higher level of safety. And then of course, ProWax and its professional competitors can supply that to these kind of customers, which means that the local suppliers are phasing out still step by step, isn't it? We try to make assessment of the competitive situation. You will find it also in our web page, our homepage, which we have included. It's our best assessment, but it's really just an assessment. There are no official figures, which are really supporting this. You have to take it as it is. Next one shows our production units and I already told about that. So even if we had some problems then during March, and it's obviously continuing, as I already said, during April, I think we are still very good geared now for a possible increase of volumes, which will come in sooner or later. Maybe now 2020 will be, of course, a problematic year without giving any figures. But I am very confident over that. Over time, these general trends that we are working with will help our production units to increase the volumes. And we have a very good sales situation now with substantial increase of capacity in this main unit in Sweden. We have the new unit, completely new unit in Italy. And we also during the year done some improvement in the American factory. We have a quite good base for the future development. So for a safer tomorrow, we have some examples then of what we are doing. And what we're focusing on is a lot, of course, on the environmental issues. I've talked partly about this before, but just as one little example, the new factory then in Italy is equipped with solar panels and that will approximately cover 50% of the energy consumption of that new factory already from this summer, we think. But it's a day to day work to reduce the total energy consumption, which is one of the major factors that we're working with. Right, after this, we have some explanation on the Truax Innovation Center, which is where we do try to do our development. And as an example, you see that on next page, which is called the unit bracket, which is a quite unique kind of bracket, which then really helps different kind of applications within the warehouse business. Our products are certified or rather the processes and some part of the product are certified by the 2 front line, meaning then that we give the customer the reassurance that it's not only true, like we're saying that the product is following a certain procedure. We are really then making sure that the 3rd party, a reliable third party can then certify that our products are following this procedure. And we think this is quite good for our customers. All right. I think this concludes the listeners to ask the questions. Yes, absolutely. So thank you, ladies and gentlemen. We'll now begin the question and Okay. We have one question come through already. Two questions, one moment. First question comes from Kenneth Towle. Please ask your question. Yes. Thank you. So I was wondering a little bit. I was surprised by the strong order intake. And also, as we enter Q2 now, how big is the order book? Because I guess that some of the orders you got in Q1, you managed to deliver in Q1. So how much sales do you have left in your order book as we enter Q2? That's a good question, Kenneth. We don't give out exactly the order book in the figure. But I can say that most of these orders that we got them during the Q1, which you might explain as a little bit of a project order, I don't like to take the word extraordinary in my mouth, but you understand what I mean. Those are for deliveries. The absolute chunk of those offer deliveries in quarter 2 have not really been delivered in quarter 1. And I think there are some parts still remaining for deliveries in quarter 3 also. So this part of this is coming quarter 2. And we have compared with our normal quarters, we have especially for the Swedish Manufacturing plant, we have an order book, which is just to give you a sense of it is it's not double the size of what it normally is, but it's approximately 50% higher than what it normally is at this time of the year. Okay. Amazing. And also, you talked a lot about factories being closed and some operational and so on. But or where you have open factories, so to say, do you experience a lot of hassle, a lot of disturbance and then disturbances and extra costs and so on for logistics and running the operations? We have experienced some of that, yes, Kenneth. I wouldn't say that they are substantial, but they are all there and both in case of freight costs to get some material into the factories in time and obviously to deliver to customers. We also experienced, of course, some turbulence because people have been sick and you have to have other people and all these things. So we've had some extra costs, yes. But I wouldn't like to say that these are really substantial costs. But during Q2, you will probably notice some of it in the gross margin that's probably in the end of the month. But in Q1, you haven't had too much of that. Some of it, especially in the Italian one, you would have seen it. But the total for the group is not a significant money for Q1. And also the your balance sheet remains strong and a lot of your CapEx needs have now come down significantly. So I was wondering, now when there is turbulent times, I mean, over the years, you have said that you might be interested in acquiring a competitor or so on. So do you think those opportunities might open up now? And would you dare to act in such a market environment in such a case? To answer your first question, if I think that these competitors or if there will be more possibilities for the M and A openings, I can really say yes, I think there clearly will be more openings because some of our competitors or some of the interested companies as we are interested in looking into, We'll probably see that there will be trouble sometimes ahead and probably will be interested to discuss. So I clearly see that coming up. Whether it would be this month or next year, we don't know. But I would think that they will come up. And to answer your question, yes, we are, of course, following this from a not maybe daily, but on a very close basis. And of course, we have to be careful since we don't want to end up in a situation where we make a rather big acquisition and then find ourselves that the market is going down in such a way that we might have our own liquidity problems. So we have to find a balance. And that's really why also the board is, of course, postponing a little bit in the AGM in order to see if we can find some tendencies which we can rely on. Otherwise, we have to take it case by case. But we are still open to do acquisition. And of course, we will look very closely not to endanger the total operations and bearing in mind that what we today think with corona might not be the worst situation coming in the coming months. Okay. Thank you very much. Okay. Thank you very much. I have another question here from David sorry, Daniel Lindqvist. Please ask your question. Yes. Hi, Thomas. So just a few short questions. You touched upon the gross margin with Kennett. But if we look at it, should would you say that it's mainly factory shutdowns? Or is there also product mix effects and price pressure in the quite pressured gross margin this quarter? Yes. We haven't seen actually during the Q1 any major effects worth mentioning, so to speak, on the pricing side. So I can say that during the Q1, it was more stable there. So we can more or less take that out of the equation. There were a little bit of a negative product mix side. I wouldn't like to say that, that was a big one. But if there was anything, it was a little bit on the negative side. So it could have been better if the product mix would have been slightly different. But nothing extraordinary, nothing to, let's say, that you really want to pinpoint to explain this. So I would say that from my point of view, I see then that the factories, it's working at, let's say, more optimal level, should have had a little bit more volume than during, especially March Q. And that, I would say, was the major, if anything, influencer of total margin and could have been slightly higher. Okay. So that means basically that for the Q2, we will have pressure as well then from the closures in the U. K. And U. S? Yes, that is correct. And then just looking further down the income statement, on the sales costs, they're popping up as a bit high in this quarter. Could you elaborate on those? Yes. The sales cost has, of course, been influenced then by the small acquisitions we did last year or beginning of this year, meaning the Japanese operation. And we also then included our Indian operations, which previously was also working as a distributor. So if you take away that hypothetically and you also take away a little bit the we've increased liquidity accrual and for bad debt, Not that they have happened, but we're just taking some precaution because we noticed that people in general and are increasing the payment days at this very moment or at the end of the quarter. So if you take away those influences, the sales costs were on the same level as last year than when you compare Apple to Apple. Then of course, under the present circumstances, we are going to be very cautious until we see how things are developing to further increase the sales cost. But we're also very, let's say, cautious not to do anything stupid because the main part of the cost, of course, in the sales cost for our salespeople, whether they are outside salespeople or inside salespeople. And honestly, they are very good and very important for statistical group. And we have they've been with us generally for many years, and we've tried to educate them step by step. So we will try to keep them as long as possible. But of course, if the worst will come to worst, we will also look into cost reductions in those areas. Okay. Perfect. And then just on the e commerce orders, you had a few, if I understand correctly, in the quarter. Were they from the same customers? Or was there a split among many customers? There were several customers. We had 3, 4, which was standing out as bigger than normal or at least not all the sizes that we get every quarter. But they came from different sources, I can say. Perfect. And then just finally, with the blacksmiths that you often talk about as competitors in the local markets. What kind of a shape are those in? What kind of do they survive in this environment? Or will you have a bigger market once this opens up? It's a very good question, Daniel. It's very difficult to give you a straight and honest answer. We should include all of these that we see all over the place. I would say generally that my gut feeling, and you have to take it as that is that the smaller ones clearly have no problems during this problematic period. And there's clearly opportunity for Truax as well as Truax competitors, of course, to take market share. And based on that, some of these smaller local competitors will have problems. Yes. It seems natural with that kind of It's quite logical in Australia, it should be. Yes. So perfect. Thanks, Thomas. Thank you. And we have a question from John Hilt sorry, I'm not going to pronounce this correctly. John Hiltner, please ask your question. Thank you. Hi, Thomas. Hi, Jan. Just a question on the good orders you had in it was mainly UK, North America and New Markets. And then just wondering if you can deliver on those from the Hilla Stolt factory or if you will be limited by any way of the factories that are closed down now and if that would be prolonged. We don't see today that these orders that we have got will have any problem being delivered from mainly the industry. We have delivery schedules to have which are all confirmed, etcetera, etcetera. So it should all be possible to do. However, of course, with the present situation, we, of course, assume that the confirmed deliveries from our sub suppliers will continue to come in according to plan. That is, of course, one source a bit uncertainty. But I think that these deliveries will be, at least on an overall basis, be possible to deliver according to plan. And does that go even for the regular business in the U. K. And in the U. S. Where you have closed down the factory, will you be able to switch to the deliveries from Hillestorpe instead? Or will you have some issues here before you open up? Yes. In those areas, we will have some issues. But we do we are allowed according to, for instance, the government in the U. S, to deliver to some of these, what is called, critical companies from a government point of view. So it's not entirely closed, and we can do something there. And that means then that we can do in good cooperation with customers who are, of course, standing in the same situation, postponed in some cases than deliveries. Then I'm not talking about this huge product. Product orders, I'm not talking about day to day business. So there will clearly be a lot lower volume produced in these kind of production facilities, especially during April. But I think from a customer point of view, we won't upset so many customers because of this, as far as I know. There will be a limited number of people who will be, let's say, whether the orders will be postponed in such a way where they will be hit negatively. Okay. Great. Sounds good. Thank you. You're welcome. And there are no further questions at this time. Please continue. Thank you very much. I appreciate both your listening in and of course to your questions. I appreciate your interest, and I look forward to talk to you again. I think there will be a little bit of more maybe gloomy situation then from a previous point of view, but let's see how it goes. We are only into April yet and a lot of things can happen. So thank you again and talk to you then. It will be then in August. Bye bye. That does conclude your conference for today and for participating. You may all disconnect.