Q1 20/21

Sep 1, 2020

And gentlemen, thank you for standing by. Welcome and thank you for joining the Zontobel Group Agate Conference Call. Throughout today's recorded presentation, all participants will be in a listen only mode. I would now like to turn the conference over to Emmanuel Hajzbil, Head of Investor Relations. Please go ahead, sir. Yes. Good morning, everybody, and welcome to our conference call on the Q1 results of the 2021 financial year. I hope that you were all able to download the presentation from our website. As always, today's call will be hosted by Aldrik Veld, the CEO of the group and Thomas Scholl, CFO. Like always, Thomas will start the call and talk you through the financials of the presentation, and then Audrey will take over and talk you through the regional sales development as well as the corona update. May I now hand over to Thomas and ask him to start with his presentation. Good morning, everybody. Like always, we want to start by giving you a brief overview of the highlights of the 1st 3 months of this financial year. Obviously, the development of our business in the Q1 was negatively affected by the impact of the COVID-nineteen pandemic, and the revenues held by over 15%. However, the terms of the group was able to generate a profit in this quarter, which is, in our view, very encouraging. Anyway, as mentioned, revenues are down by 15.4%. Our adjusted portfolio and exchange revenues should be at minus 15.2%. The top line decline is coming from both segments. Lighting segment is down by 14.8%. The Components segment is just 18.1%, also clearly below previous year level. Business in the Components segment was also negatively influenced by advanced stock purchases by many customers at the beginning of the worldwide lockdown measures in the 4th of which took place in our Q1 of the 20 nineteen-twenty twenty financial year and which then led to the substantially lower order levels in the Q1 of this financial year. Anyway, the developments were different between the markets. Our cold pack market avoided the ability to decline and were down by roughly 6%. But European markets in Great Britain, France, Italy, were particularly hard hit with declines of approximately 6% in the U. K. And about 20% in France and Italy. The group adjusted EBIT decreased from €15,100,000 to €9,100,000 as the gross profit before R and D was €17,200,000 lower compared to previous year. Higher positive earnings have been supported by cost savings and utilization of the short time work options in different European countries. As a consequence, the SG and A costs were €10,000,000 lower than previous year in the Q1. The largest savings were realized in the personal costs, further expenses, marketing and in the lower transfer costs, which resulted from the decline in the revenues. The good news here is that the development of the earnings during this quarter shows that the team of the group has a much more robust position than ever than before due to the measures implemented in the last 2 financial years. And this development also underscores the success of our quickly implemented effective crisis management in dealing with the effects of the COVID-nineteen pandemic. And below the line, the net profit equaled €3,100,000 And we have recorded 1 off costs for restructuring measures of €2,100,000 And these are primarily related to costs arising from the shutdown of the ACDC plant in Beryl Fort, near Manchester and the relocation of production to the plant in spending more, which should take place during this financial year. We hope you will understand that we are still unable to estimate the exact impact of the corona pandemic. We have, therefore, decided not to issue any guidance on the development of the revenues and the earnings for the full 2020, 2021 financial year at the present time. Let's move now to the next chart to give you more details on the development of each segment. On Slide 3, as usual, you can see the revenue development per quarter on the left hand side and adjusted EBIT development per quarter on the right side. As mentioned before, as a result of the pandemic, revenues in the Q1 decreased by 14.8% with basically no foreign exchange impact. On the right hand side, you see the adjusted EBIT development. And there is a result of decreased top line. The adjusted EBIT in the first quarter declined to €8,000,000 versus €13,500,000 in the previous year. However, this is still a satisfactory level given the top line development. And obviously, this has achieved a strict cost control and short time book options. Let's move on to the component segment. The revenues in the component segment were down by 18.1% for the Q1 sorry, and capital adjustment for foreign exchange segment was declining by 17.4%. As mentioned before, the beginning of the crisis in the Q4 in the last financial year led increased inventory purchases to the customer in reaction to supply chains that were disrupted by the COVID-nineteen pandemic and subsequent positive effect on the segment revenues in the Q4 of last financial year. This was followed by negative effect on the Q1 revenues for the current financial year. One more interesting point. In the past quarters, we have always been talking about the strong price pressure Cardenas is facing. However, the price pressure in the full quarter has been down as only approximately 1% versus Q3. And this is about all due to the logistics surcharge of 3.5%, which Genonix started to charge to customers based on additional logistic costs they have been facing when the crisis started. So we have to ask that this logistics surcharge is no longer charged as the logistic costs will all came back to, so to say, normal levels. On the adjusted EBIT level, the profitability fell to 5.2% as a result of the lower contribution to the significant volume declines. On Slide 5, we see the combined sales of components and the lighting segments, and I think there is no additional use. So I will move to Slide 6, showing the EBIT bridge. Starting with the price, we adjusted EBIT for the Q1 of €15,800,000 The excess gross profit of the group before ANGI increased by €17,200,000 That is basically the result of the £46,000,000 of our revenues versus the Q1 of the previous year. Our EU expenses decreased by €1,100,000 which is mainly the result of lower personnel expenses. And in the functional areas of selling and admin, we can see additional cost savings versus previous year. Efficiency improvement and cost reduction measures resulted in a full increase in the SG and A expenses of €10,000,000 especially utilization of the short time work options supported the lower cost base. Other operating results, excuse me, excluding the special effects, they were slightly slightly above the previous year level. So this brings us altogether to an adjusted EBIT of €9,100,000 in the Q1 of this financial year. On the next slide, you can see the full written statement. There is, in general, not too much to add. Maybe just a few comments. We have special effects that increased from €400,000 to €200,000 And as I already mentioned, this is related primarily to the relocation of the ACD production. And the financial results declined by €1,200,000 to minus €3,000,000 And here, we have in the other financial income expenses. This includes the also the income and expenses resulted from the exchanges in foreign exchange rates. And here, we have a market valuation of exchange rate hedges that we made just for the operating business. And here, we have this represents the major component of that negative result here. And on the bottom line, this brings us to the €3,100,000 net profit in the first quarter. Let's move to Slide 7, to the cash flow statement. As a result of the crisis, we were not able to first optimize our working capital during the reporting period. In comparison with the prior year, the operating capital rose from 15.1% to 17.6% of the rolling 12 months revenues. The cash inflows from the change in operating or in the other operating positions totaled €7,100,000 versus outflows of €6,900,000 in the previous year. And consequently, the cash flow from the operating activities dropped from €19,600,000 to 5.6 €1,000,000 in the Q1. The cash flow from investing activities was lower than the comparable year period. It was minus €8,000,000 in the Q1. This included also investments for capitalized development costs of roughly €3,000,000 Anyway, the free cash flow fell to minus €2,400,000 primarily due to the reduction in the cash flow from operating activities. Let's go to Slide 8, to the balance sheet or some selected balance sheet data. Our net debt totaled €179,000,000 as of end of July 2020. This is 1,000,000 as of end of July 2020. This is €13,500,000 above the value as per 30th April 2020. Our liquidity situation is backed by the consortium credit agreement, the term ending in November 'twenty two, the maximum value of €200,000,000 or €60,000,000 €1, end of July. And we have, as you already know, 2 long term credit agreements of €40,000,000 each with the European Investment Bank. And here, we have a bullet repayment in September 'nineteen 24, respectively, February 'twenty five. Both are fully drawn. And what is new, we have, let's say, on Binta Bay, a special framework credit for large enterprises, a so called somewhat higher in Austria of roughly €40,000,000 whereof roughly €20,000,000 were drawn end of July. And on top of that, we have uncommitted these lines of credit totaling €53,000,000 To sum it up, we have a strong balance in liquidity situation that is, of course, a very strong backbone in the current crisis. As you all know, there are 2 financial coverings attached to the financing agreement, namely the debt coverage ratio of less than 3.55 and an equity ratio of more than 23.5%. And these financial covenants are tested end of April end of October. This is all with respect to financial development in the Q1. I think we have successfully adjusted our business to reflect a substantial decline in the activity in our various markets. And in particular, the positive net income flows once again that we are today in a much more robust position than 2 years ago when we started the journey to establish a lean and effective organization. May I now hand over to Alfred to provide you with a brief update on the regional sales developments and the outlook for the full financial year against the backdrop of the COVID-nineteen in the Good morning, ladies and gentlemen, and warm welcome also from my end. Harpreet Pfalger speaking. If you have a look at Page 10, then you see that our journey of slight growth, what we have established until quarter 4 of last year came to an stopped towards the end of the quarter 4 last year. Biggest impact, if I may just spend 2 sentences about, was a debt by mid of March, so 6 weeks before the year end, especially in the Lighting segment, we had a severe decline, what led as a group to minus 12.7 percent in quarter 4. He has to say, and Thomas mentioned it already, that the Tridonic was basically having the surcharge of logistic costs due to the supply chain disruption out of China in February, which led to a Papa stock increase of both at the customers so that the last fiscal year was more or less very little impacted on the Tridonic top line until the end of April, and then the drop came. If you look into our quarter 1, then we see from the lowest April numbers what we had a constant increase May over June and over July, where July is then in a still in a double digit decline but close single digit trends so that we see that the businesses in the different territories are recovering. If you have a look at the next page, then you see again our split in the different territories. And Thomas mentioned it already. The DACH region has been, obviously, also with the proper management of the government going through this pandemic quite smoothly. All in front, we do see that in Switzerland, our high margin business was more or less not only steel but still slightly in a growth mode. Austria, with a reopening especially of the construction sites, was also almost on par with previous year level. In Germany, we are a little bit behind, but contributes to this minus 6%. But also here, I have to say that in Q1, last fiscal, we had a couple of very big projects in stadium like Bayern Munich, Borussia Dortmund, minus 5, what basically did not come anymore into the Q1. More severe is the impact in the Northern and Western Europe. This includes Benelux and Nordic and U. K. Obviously, U. K, I guess, we will deepen a little bit. That was the biggest drop with partly a decline of more than 30%. Similarly, in the Nordic territory, with the exception of Norway, but of course, with Sweden going a different way, that was quite having an impact. In Southern and Eastern Europe, Southern heavily impacted, as you know, Italy more or less in a complete lockdown with Bartlek for a couple of weeks, almost zero revenue similar to France. And in Eastern, we rapidly depended a little bit on the countries. Here, we had in Q1 still difficulties to go over these different borders and countries. And we have partly not been able to serve the customers simply because of the traffic on the borders, also with a double digit decline. Asia Pacific, different picture. China, after the February lockdown came back, but it's not a big revenue stream, heavily impacted more specific with New Zealand, which is a nice market there for us in for weeks in a complete lockdown. And then Australia, partly lockdown. You've also seen it that a couple of weeks back. Victoria, a bit territory around Melbourne, is again in lockdown. And then in addition, we had these posh fires what were limiting the business. Rest of the world, you see an increase of 15.5%. This is mainly driven by Middle East, by EMEA, where especially in the Emirates, in Saudi Arabia and in Qatar, we have been able to navigate through the business here quite smoothly. Of course, it's not a big number, but it's nice. And that seems to be continued also in the quarter, too. If you have a look at the Page 12, then this is the latest result of Euro construct what we received in August compared to the June numbers. It's seen in most of the countries a slight improvement on the decline. Obviously, U. K. Was more than 30%. It's now still 23.7%. The GDPs, I think, I didn't have no need to comment. You have also did the data here. Promising Germany, Switzerland and also Austria with a single digit. Slight recovery in the Nordic territories where we believe in the next quarters to come, business might come back a little bit more aggressively than in other territories. And France and Italy, obviously, in a deep decline. Very surprising to us that France is so much down, but obviously, the latest numbers show again that we are stalling the business with partly certain construction sites are not open. If we look into 2021, and that's the comment on paragraph number 2, there is, compared to the June, a more moderate outlook with a slower growth of, let me say, 3% to 5% per year what we have as a growth. And that's also indicating that going back to the pre COVID-nineteen level will take a little bit longer than we originally anticipated when we were entering into the crisis. If you go to the next page, I think that's pretty much in line what we also presented in the last fiscal year results, what is the stage growth luckily, and also that continued. Up to now, we have been able to manage the business through the crisis. Obviously, with all the measures, what we did with home office regulations, with safety and health precautions, we have been able to keep all the businesses up and running, especially when it comes to supply chain and product availability. We had the luck that with the exception of France, where we had one corona case, and we had to close the factory for 2 weeks. All the factories are up and running, are serving the customers. And obviously, I think it shows what Thomas has presented. We have been continuing to do a strict cost management with looking into all the functional areas on both discretionary spending and CapEx investment, very careful in hiring short time work measures in main campus, especially in Austria, in Germany and in UK. We have to say, with the increase of the activity on the customer base, most of the sales territories are out of short line work already. We are still in there until September in Austria. And obviously, what also helps is the reduction of flex time hours and vacation during the summer period in the months of June, July and now or also August. On the other hand, especially now during the Q1, we have been extremely focused on the development of the ongoing projects and lighting solutions. We are coming in the launch window in autumn with a couple of new releases of products that we believe we can concur the market in different segments we are in. However, we are also now looking into the new opportunities for new applications, but obviously emerge when it comes to health and care in hospitals, in not only homes where money is spent in education, also monitor very carefully how the retail business develops because also what we see in not system relevant applications in retail business went back. And also in home, in office. And we are looking now on the opportunities of providing home office solutions. On the people side, we have been dramatically increasing digital customer experience, not only through webinars and e commerce, but also to video conferences, what we are partly using also to introduce our new products simply because we are limited in having face to face meetings in all our live forums, especially here in Donpeon, where we plan to have these big events during this already the quarter 1 here. Looking into the outlook. Obviously, this corona pandemic has triggered an economic downturn, but we did not anticipate, and it's very difficult to predict. We are all hoping in the industries that a second lockdown will not come. Partly, we see slight impact of local restrictions what we have in different countries, but up to now, still very manageable. But obviously, we are currently not in a position to provide the guidance on both revenue and earnings in 2021, so that our original EBIT margin of 6%, what we plan to accomplish in 2021 will be delayed after the 4.8% what we have achieved last fiscal year. So with that, we would like to come to the end of this presentation. And then we are open now to your questions, and we were able to start the Q and answer session. Thank you. The first question comes from the line of Marcus Raymes with RBC. Please go ahead. Good morning, gents. Congrats on the results. A couple of questions, please. Firstly, on the component business and your comments regarding the logistics surcharge, the 3%. I didn't quite get it. Did you say that this surcharge is actually already abolished? Or should we regard that as sticky going forward? And in connection with that, is there any change to the price pressure in the Luminaire business? Okay. Yes. The surcharge thanks for your questions. The surcharge on the components business was related to following. As you know, our single biggest volume sector is in China. And 50% or quite a lot of both drivers, especially as well as components for drivers, what we manufacture more and more in niche for the European market, are coming from China. During the lockdown in China in February, we had tremendous difficulties not so much to get the parts, but to get the parts out. And more or less, it was a time where over weeks, we have to fly 100% of the parts out of China, which obviously was bringing additional cost. We started then to say to the customers during that time, we need to add a surcharge, which, as Thomas mentioned, is 3.5%. What basically was valid until the end of July. But basically, then everything came back to normal. With this additional charge on the components and with result and only a price erosion in the range of 1% because the estimation was obviously much higher. But obviously, if you say 1% price erosion, if you would not have done the surcharge, it's still in the range of 4% to 5% of price erosion and what we see in the components business. When it comes to the lighting, we have done a selective price increase on certain products what has been impacted by the supply. But we have not done this like PRIDONIC, an overall 3.5%, which also countermeasures a little bit the price erosion. And luckily here, I have to say, that also the price erosion of skin delighting segment during that period in Q1 was less than we had budgeted and what we had forecasted. However, in a shrinking market, what we see very clearly now is that the price pressure is coming back because the fight for the project is coming by the different competitors what we see in the market. And most likely, over the next quarters to come, the price pressure on the lighting segment and also on the component segment will not get less. We also hope that it will stay as, let me say, nowadays moderate in the single digit for components and in a lower single digit for the lighting price. Okay. Very clear. Thanks for that. Can I then ask you on the short term work? You said that sales organization is out of short term work. Have you made up your decision whether you will utilize the new scheme of the Austrian government after September? And also related to that, any plans for a headcount reduction? Right. So obviously, what we have done, and now we have again the nice scattering regulation in Europe. We have been following the local requirements of the local governments when it comes to short term. In most of the countries, now with the exception of Germany, Austria and UK, we have sales. We had only sales setups. And pretty much at the end of May, when we saw business coming back and customers reopening the construction sites. We exited the short term work simply because it was absolutely necessary to intensify the interaction with customers, which remains difficult because we were not able to visit. We were mainly doing it via digital interaction, and that was quite intense. In the factories and or in the production sites, we when the second question, especially in Austria, this is currently exactly the evaluation what we do to find the right bandwidth of utilizing it versus the fact that now the time comes where we really need to speed up our all the new developments. Current situation is that we are evaluating this very carefully, and we might consider of extending it where we need more flexibility on the production side, but that we are going back to a full time work in the key functions, which are the R and D, which are the product marketing, the product related parts, so that we are able to speed up again the development of the new products and the new solutions. Your last question, that's in line with our evaluation, where we obviously see what is it and what we need to do on structural adjustments in functions where the business is not able to come back in the next 18 to 24 months to the levels what we had before the COVID-nineteen. And we are currently running these evaluations, and we plan to see them make a final decision by beginning of October. Because obviously, similar to that what we said, we are not able to issue a guidance. We are now seeing an increase of order intake at very moderate. But we have also seen that the increase of the business is not going back to our original anticipation where by the end, the middle of quarter 2, we will be back at previous year levels. That we know already for sure that this will not be the case. Now it depends heavily how the next couple of weeks will develop. Very clear. And then one more, please. On the cost savings, can you help us maybe understand how much is actually fixed cost savings and how much over the last quarter or last two quarters is more of arrival costs that will reemerge rather quickly once business picks up? Out of the €10,000,000 savings, there are roughly CHF 6,000,000 coming from the short time. Now I'm talking from the 1st quarter. And roughly SEK 6,000,000 out of the SEK 10,000,000 are really from the short time working scheme. And then on top of that, of course, we have reduced holidays, flex time, working hours, etcetera. Also, as I mentioned, travel costs, some acting costs because we cannot do events or participate in events. So basically, if we come back to a normal level, this cost savings will disappear. Sorry, I didn't get the last sentence, please. It becomes back to normal level. It stops short term working. And also traveling is picking up or then activity is picking up, then these costs will reappear. Okay. Okay. Very clear. Just to clarify, so in the 4Q call, you said you had about savings of $4,000,000 from the short term work and another DKK 4,000,000 from the other areas, travel and so on. So actually, it was a bit higher in the Q1. Yes, yes. Because this is due to the fact that last year, we had this very strong lockdown there starting from mid March until end of April, there was a total lockdown. So basically, no activity at all, which are besides the work from home. And now with start with this business here, then we had some vaccine only, yes? People went back to the office, and there was the activity was picking up. And also, we had, of course, a higher activity level even though we were still in the full time working fee, we were roughly at 70% on average. And this was in the Q1 of last financial year. We were starting from mid March. These were down at between 14%, 50%. The next question comes from the line of Mitraer Machalino with Erste Group. Please go ahead. Yes. Good morning, gentlemen. Thanks for taking my question. I'd like to ask one quick one. Could you give us a guidance on the CapEx for the current year? Yes. Between €45,000,000 €50,000,000 Okay. Thanks. The second one, just a clarification. On your order book, you said in July, you saw a double digit decline low double digit decline. What are you seeing currently in the U. K, I guess, still more severe here the decline. Yes. UK, it's still a high double digit decline. If you're referring to the order book, that's exactly the big challenge that we had. Let me go back a little bit. At the beginning of the fiscal year, when COVID was already there, the order book, what we had, was higher than significantly higher than the previous year. So obviously, all the projects what we gained were still alive. Now in a lot of countries, we see a huge delay, but we have to monitor almost on a daily basis because also customers are shifting this project. But luckily, most of these projects are live and are in the pipeline. When it comes to the new orders, what we have, obviously, it's a different picture. We do see and that's pretty much in line with Euro constructed in the DACH region. The order entry is constantly increasing but still below the previous year levels. In UK, in France, for example, and in Italy, after the lockdown, the order book increased again. Partly in countries like U. K. And in France, where we have a significant business done via the distribution. Once the distribution offices opened again, we saw quite a refilling of the stocks in there, what resulted in a positive contribution. But to answer your question, it's still the big challenge in the big markets like France and especially the U. K. That the order book is much weaker right now than the DACH region. Okay. And just one final question. You mentioned at the end you're looking at new product lines. You mentioned health care. Do you have here the in house capabilities for these products? Or are there some M and A opportunities on the market? Or is that or it could be on hold for the time of the crisis? Or would you be interested also if there's an opportunity? Yes. So obviously, when what triggered what the COVID-nineteen triggered is that much more attention is paid on the well-being, on the safety of, let me say, this risk people sitting in elderly homes and in hospitals. There's one activity where we partner with companies what had to do with UV disinfection, but obviously not going too much into the technology. Here, the LED technology compared to the UV tubes is still far below that what is expected. But here, we are having activities. But the other one is more the well-being itself that you have more activities going on into the human centric lighting, into the well-being, what obviously is one of our core activities where we have resources allocated and where we now are increasing this in order to be able to support this kind of activities. Okay. I understand. Okay. Thank you. We have a follow-up question from the line of Marcus Reimis with RBC. Please go ahead. Yes. Thank you. A few more from my side. On the one off cost for the full year, would you have an updated guidance for us? And also, if you could elaborate a bit on where the restructuring money will be spent? Any more closure plans or relocation? Yes. It's yes, this is related to what Alfred explained just before about our decisions regarding future setup and restructuring. If there is no major restructuring, it will be synergy. We will have maybe some reductions in the in our sales network. I think we already mentioned that, but especially in the in house functions, we have a project to streamline the organization. So there will be that the plan is to start implementation this financial year. So there will be some impact. But this will be, anyway, according to all, in a single digit range and as long as there is no major restructuring. Okay. And then on the components side again, I think last time you mentioned that your customers have tried to build up some safety stock. Do you have a feeling how the stock level has evolved over the quarter? Biogen rather depleted or again or still coming You're currently in the components business, right? So components, yes. Yes. Obviously, we have seen quite some huge, let me say, 4x order intake. And let me say, 1 week before we increased the prices, where obviously, then this was flat over the next 6 to 8 months. What we see as indicators that this buffer stock is now coming to an end and the normal business behavior comes into place. However, if we are just looking into our performance and if we look into the performance of some of our competitors where we have the data, still we are in the note that this is a double digit down compared to previous levels. But we see a slight increase now over the last couple of weeks. Obviously, August is always a difficult one, but it's now a good indicator how September develops. We believe that, that is the month where the stock level will come to an end or to lower level so that then in a position to order again. Okay. And final question on your remark in the presentation regarding home office solution. I mean, is that more of a strategic shift towards Residential Solutions? Or is this more of an, how do you say, opportunistic step you're taking here? And do you have the distribution channels to serve this, the residential demand? So we are here, I have to admit, at the very beginning, we are just believing that in the different countries, let me say, the legislation will be changed into, we call it, more flexible working environment where home office is one of the parameters. We believe that, that requires then also certain criteria on ergonomic, let me say, furniture plus light plus infrastructure. And already in the past, we have been in close contact with furniture makers, with IT companies. And here, we are jointly now monitoring what solutions we could offer. If it's more than an opportunistic approach, then obviously, we need to see how we approach the whole residential setup, which is currently not at our core. But we what we are seeing now is a certain shift of office investment in big cities and towards a more home office investment. And we want to be prepared if the legislation changes in such a way that there are certain criteria where also life plays an important role. Too early to say whether this is a more short, medium term opportunity or it's really a strategic one, but we have started this initiative. All right. But you would have to develop new luminaires? Not necessary. Obviously, it goes Luminaires not sales channel yet. It goes in line with that. We have already part of our product innovation is also that we have this freestanding Luminaire initiative, where we are launching a product what makes office illumination more flexible. But obviously, when it goes into pure residential, then I think that would need to be built up and also from a go to market sales strategy. And you could roll that out throughout your global presence? Or would this be more focused on, I don't know, dark region or Well, I think what we see when it comes to home office driver is, for sure, again, the DACH region. Most likely, this is also the most promising one, what we do, we'll use it as a best market. Typically, we start with markets like Austria, where we have a strong market presence, and we know how it is. And then it depends on the legislation. But we believe that will be the focus 1, followed by the rest of Europe and then followed by the rest of the world. But the focus, as always, is Europe for us, and the primary focus is the DACH region. But we also believe that this would come most aggressively. At this time, there are no further questions. I hand back to Albert Sperdol for closing comments. Yes. Then I would like to say thank you very much for listening, for your interesting questions. I think I hope we have been able to show you that with the efforts what we did the last 2 years, we are robust enough to handle this. Obviously, it's not easy. The outlook will be as such that then most likely in the next 2 months, we have a clearer visibility how the market develops. Hopefully, that is constantly going upwards, what we see as a trend. And in parallel with the activities what we have launched on new opportunities, we believe that we are very well prepared for the next round of sales growth, hopefully starting already next fiscal year. So thank you very much for listening, and that brings us to the end of this call. Thank you.