Haleon - H1 2023 (Q&A)

Transcript

Operator (participant)

Good afternoon, all. Welcome to the Haleon Half Year 2023 Results Q&A session. My name is Adam. I'll be your operator for today. If you'd like to ask a question on today's call, please press star followed by one on your telephone keypad to enter the queue. I will now hand the call over to Head of Investor Relations, Sonia Gakhal, to begin. Sonia, please go ahead when you are ready.

Sonia Gakhal (Head of Investor Relations)

Thanks very much, Adam. Good morning, everyone, welcome to Haleon Half Year 2023 Q&A conference call. I'm Sonia Gakhal, Head of Investor Relations, and I'm joined this morning by Brian McNamara, our Chief Executive Officer, and Tobias Hestler, our Chief Financial Officer. Just to remind listeners on the call that in the discussions today, the company may make certain forward-looking statements, including those that refer to our estimates, plans, and expectations. Please refer to this morning's announcement and the company's U.K. and S.E.C. filings for more details, including factors that could lead to actual results to different materially from those expressed in or implied by such forward-looking statements. We've posted today's presentation on the website this morning with prepared remarks running through the results in detail. With that, we'll go straight to opening the call for Q&A. Thank you.

Operator (participant)

As a reminder, if you'd like to ask a question today, that's star followed by 1on your telephone keypad. If you wish to withdraw, that's star followed by 2. When preparing to ask your question, please ensure you are unmuted locally. Now our first question today comes from Iain Simpson from Barclays. Iain, your line is open. Please go ahead.

Iain Simpson (European Consumer Staples Equity Research)

Good morning, everyone. Two questions from me, please. Firstly, that 7%-8% full year 2023 organic sales growth guide, that implies 4%-6% in the second half, which is obviously in line with your medium-term guidance. Is that how you should think about it? You're basically booking the strong first half and just delivering on the algo in the second half. In terms of the moving parts within that second half, there was some nervousness that tough cold and flu comps and respiratory might be an H2 headwind. Do you feel more relaxed about those now, or do you expect strength elsewhere in the business to offset tough respiratory comps in the second half? Then in terms of second question, just wondered if we could unpick the moving parts in the margin.

You're guiding 7%-8% organic top line, 9%-11% constant FX EBIT, so margins adding 2%-3% to EBIT. Then in terms of FX impact on the business, we seem to be looking at sort of 4% top line, 6%-7% EBIT, so a 2%-3% drag from FX. In terms of margins for the year, should we be thinking underlying margin delivery a little bit best than expected, FX headwinds may be a little bit worse than expected, net-net margins probably staying flat in line with your previous guidance? Thank you very much.

Brian McNamara (CEO)

Thanks, Ian. I'll, I'll take the first question, and I'll pass it to, to Tobias on the margin. As you, as you said, we had a very good first half, and we feel good about the growth in the first half and the fiscal year outlook. I think there's two things in the first half that won't repeat in the second half, and the first one you mentioned is cold and flu. If you look at the 22% growth we had in the first half, that contributed about two points to our overall growth. In this outlook, we're expecting an average season, which would be below last year from a volume perspective.

Now, want to be clear, it's hard to predict cold and flu season these days, but we've taken an assumption that we believe is, is right at this point. We're talking about volumes being down, but pricing largely offsetting that, so roughly a flat category in the second half. In the first half, we did see strong growth in China with over 20% growth, and that was, you know, we had good performance across the portfolio, but Fenbid and Contac in particular, which is our pain relief brand and a cold and flu brand, saw a significant demand coming out of COVID lockdown, and as a zero COVID. As a reminder, in zero COVID, those brands were actually on sales restriction because they treated COVID symptoms. You know, in zero COVID, they didn't want that.

There's two dynamics. One was lockdowns coming off, getting back to a normalized level for those brands, and then some incremental demand based on COVID actually going through the through the country. You know, that's where the full year guidance comes. You're right that the back half would imply a four to six more thinking about it, of, of the dynamics in the back half and, and, and what we're seeing.

Operator (participant)

Tobias?

Tobias Hestler (CFO)

Yeah, so, so on, on the margin, so I mean, clearly, we've said seven to eight on top line for the year, 9-11. I think that gives you, I think, a very strong underlying improvement and strong underlying margin improvement. Also, just to clarify, that includes offsetting the transactional FX losses in the business. As you've also seen in my prepared remarks in the-- we have 60 basis points of margin improvement operationally that fully offset the transactional losses in that. Underlying, absolutely, an upgrade and an improvement coming through on the margin from, from the, from the strong performance in the business. Yes, FX, and that depends a little bit on, on where you, where you build it from.

I mean, ultimately, the consensus was around a five to six CR growth. Our improved guidance is 9-11, you should add at the midpoint, four to five points of profit growth, and then you deduct from that the incremental translational, which is 6.5. You know, a small down, small down on AR profit growth. Again, if exchange rates would stay where they are in June, I've given you a little bit more color on how to model that in the appendix of the slide deck. We've added a few more of the currencies to help you model that out.

Operator (participant)

The next question comes from Guillaume Delmas from UBS. Guillaume, your line is open. Please go ahead.

Guillaume Delmas (Equity Research)

Many thanks. Morning, Brian, Tobias, and Sonia. two questions for me, please. The first one is on pricing. I was wondering what the outlook was for pricing as we think about the second half. In particular, are you planning additional pricing actions or kind of the opposite? Would you be looking at some price downward adjustments, maybe increase in promo activities, to maintain your level of competitiveness and maybe improve your volume share momentum? I know I think it's more a value share number you're looking at, but I noticed that 55% of your portfolio was gaining or holding shares at the end of the first half versus two-thirds at the end of last year. Any color on that would be helpful.

Then my second question is on translational effects, because it's looking like it will be a significant headwind this year that you, you'll be able to mitigate. Big picture-wise, how should we think about this impact? Is it a case of trying to offset it when it goes against you, and letting some of the benefit fall through to the bottom line when translational effects is more favorable? For instance, you know, if we were to see some reversal next year, should we expect better than moderate margin improvement in 2024? Anything you can say about your, your mindset when it comes to translational effects, would be very helpful. Thank you.

Brian McNamara (CEO)

Great. Thanks, Guillaume. Let me address the question on 55% share, and then I'll pass it over to Tobias to talk pricing in the back half and big picture. Yes, year to date, we are 55% of the business, maintaining and gaining share. We have seen that number strengthen in recent months, so we think there's a positive trend there. You mentioned it, but this is a value share measure. We were impacted a bit earlier in the year by the phasing and timing of price increases. Just to bring that to life, I'll give you one example. Tums, for instance, in our U.S. business, we took pricing at the end of Q1. Some competitors happened to take pricing earlier in the year. We are now...

We didn't grow share in Q1, and now we're back to strong share growth. Just on promotions, we tend to be a lower promoted business, even in categories that can be high promotion, like oral health. Because of our strategy of therapeutic oral health, we invest more behind the dental detailing and the marketing and connection with consumers than we do promotion. We don't anticipate changing that strategy. OTC in general also tends to be a lower promoted category. We didn't anticipate any change. Tobias, on pricing and big picture.

Tobias Hestler (CFO)

Yeah, thank, thanks, Guillaume. On pricing, I think, I mean, for the half 2, probably mostly rolled over from what we've done in half 1. Also, don't forget, we took increased pricing during half two of last year as well. Of course, I mean, in emerging markets, we would keep pricing up as we as we can and as we've always as we've always done. Then look here or there when we see there's an opportunity to do something, we would do it, but I wouldn't expect, you know, widespread further further further pricing increases. Brian has already answered you the promotional question on pricing, so I wouldn't expect anything going backwards on that either.

Then on translational, look, I mean, I, I can't plan for translational, so I think, and I believe in the, in the way we've guided and the, the guidance change we've made, I think we're giving you the CDR growth on profit. Then I'll update you on a quarterly basis around what the translational impact is. You know, this might go one direction or might go the other. I hope with the additional color I've given you on more currencies in the backup, that helps you also model it, model it through yourself and have a bit more upfront visibility on that. Thank you.

Operator (participant)

Thank you. The next question comes from Rashad Kawan from Morgan Stanley. Rashad, your line is open. Please go ahead.

Rashad Kawan (Equity Analyst)

Hey, good morning, Brian, Tobias, and Sonia. Thanks for taking my questions. Just two for me, please. The first one on VMS, obviously positive in, in Q2, but in the present, I know you mentioned you expect continued pressures on immunity in, in the US with Emergen-C specifically. Does that alter your midterm outlook on, on VMS of that kind of mid to high single-digit growth overall? Then just the second question on the consumer broadly, are you seeing any changes in terms of behavior, any change in terms of down trading trends or shifts to private label, especially in Europe, as you've taken more pricing? I know, you know, volume dynamics still seem to be robust, but any color you can shed there would be great. Thank you.

Brian McNamara (CEO)

Great. Thanks, Rashad. First on VMS. As you said, we were down 3.7 in Q1 and up 2.7 in Q2. For the year, we were down 0.5%, and if you just break that down across regions, we were in single-digit growth in Europe, Middle East, Africa, and Latin America and in APAC, but we were down double-digits in North America. Two things impacted that. One was the, you know, lapping capacity coming on stream last year, where we built inventory. That was a negative impact. Then on immunity subcategory, which you mentioned, we are seeing a bit of, you know, a change in consumer behavior of the immunity category going back to more pre-COVID type levels.

We saw incredibly strong demand in, in the base period, as you know, as COVID spikes came in. That was a category that always had good mid-single-digit growth, so it was a healthy category pre-COVID, fully expected to be a healthy category post, normalizing. We do expect, and in our outlook, we're assuming that that will still be a drag on the VMS business as we look at the back half of the year. Nothing has changed in my medium-term outlook, and, obviously, we'd update, you know, for, for next year when we get there. We feel like it's still a very good category. You know, 35% of our business is UF. We like our geographic footprint, and, and we're seeing, you know, good growth outside that.

On, on consumer behavior, you specifically asked about Europe, you know, to date, we are not seeing that. A reminder in Europe is that we have very little private label dynamic, 'cause there is very little private label dynamic on oral health, which is in mass market. Obviously, there's lower priced brands and we're, we're seeing good dynamics on our, our oral health business. Then in the OTC business, we're sold through pharmacies, and there's really no "private label," quote, unquote, to speak of. There is generic products in pharmacies. They tend to be under the behind the counter, in the drawer, so people aren't going up to the shelf and doing comparison. To date, we haven't seen that shift.

Obviously, unprecedented times, and we're keeping close eye on it to see if anything changes there, but to date, we've really seen the categories hold up.

Tobias Hestler (CFO)

I said, I think you asked on the US, I think private label, no change visible in our categories. I think, when you look in aggregate, private label shares actually are slightly down across all of our categories. Of course, you have some subcategories where it's slightly up, slightly down, but no, no shift visible in, in sort of consumer behaviors, when they're in front of the shelf, vis-à-vis the private label, that is there.

Rashad Kawan (Equity Analyst)

Thank you very much.

Brian McNamara (CEO)

Thank you.

Operator (participant)

That's a reminder that star followed by one on your telephone keypad to ask a question today. The next question comes from Chris Pitcher from Redburn. Chris, your line is open. Please go ahead.

Chris Pitcher (Managing Director)

Thank you. Good morning, all. A couple of questions. Firstly, on China, thank you for the extra detail in the presentation. Can I just make sure I've got the messaging right for the second half? Growth moderated, but was still double-digit in Q2, based on your disclosure. You're talking about a normalization in Fenbid, but it does look like there's still strong opportunity amongst VMS. Could you talk a bit about oral health, and how you'd look to grow that in terms of strength of local and international competitors? In terms of your raised full year guidance, does that still imply double-digit growth in China in the second half?

Then just secondly, on, on the Lamisil divestment, obviously helping the deleveraging, can you, can you give us a bit of a feel for the sales and profit impact, cash impact on, on, on that? Thanks very much.

Brian McNamara (CEO)

Thanks. Thanks, Chris. I'll take the first question and then pass it to Tobias. As you said, we had a good first half in China. We grew over 20%, and obviously, we benefited from the COVID lockdown, or the zero-COVID policy going away and Fenbid and Contact. The oral-- the VMS business also is growing, so in good shape. We continue to see trends there. On the oral health business, what we saw was the category declining as we entered into the year. We are still seeing the category declining, although declining less, and in, in most recent periods, we're growing share, so we're declining less than the category. We expect that to, in the back half, continue to stabilize.

Listen, we feel good about Sensodyne in China. There's no question that there is competitive environment in China that can be a bit different in the sense of local competitors, and they're not to be taken lightly. We've, we've been there, and we've been competing against them, and that's something that's always been something we look at. You know, we feel good about our business in China. On the back half, you know, we wouldn't give specific guidance on China, but we expect to be able to see growth in China as we go into the back half. Obviously, we'll see less of that COVID impact. The lockdowns were still in place. Our zero COVID was still in place a year ago, so sales restrictions were still on things like Contact and Fenbid.

Obviously, in the first half, we saw COVID waves coming into the country, which drove demand above that. Tobias, Lamisil.

Tobias Hestler (CFO)

Yeah. On Lamisil, it was $54 million of revenue last year, I think with a very healthy, you know, gross margin. It's an OTC, OTC brand and small A&P. I think you get clearly a negative hit from that on the OP and from the margin with the $54 million, I think we sold it at a very healthy sales price, so that is about a four times, seven times revenue multiple that we get. And of course, it was, you know, it was declining in sales, so it's slightly, very slightly, was slightly dilutive to sales growth, but, I mean, that, that's really tiny.

Then we would, of course, expect to offset the, the negative impact from, from the divestment on the profit with the benefits from the productivity program next year.

Chris Pitcher (Managing Director)

...maybe just to follow up, would we expect similar brands potentially to come out, or are you done now for divestments?

Tobias Hestler (CFO)

No, look, I mean, as, as said before, right? I mean, we said at full year, we're going to be active in our portfolio. You've seen us do two things this year, so far. I mean, we've divested Lamisil, which I think at a very good price, and this is a classic example of I think there's a better owner out there for that brand, and we got good value for it, so it makes sense to divest that because I think it's clearly above our own keep valuation, but which you see from the price. We've also agreed to deal with Futura, so we brought something into the portfolio.

I mean, you would expect us, you know, in a, in a company with about 100 brands, to look at things if they create value or, or not. I think, we do this, but, you know, it's, it's you have to test the market to see if you get value for it or not, and, that's exactly what we've been doing, and Lamisil is an example. Expect us to be active, but if something comes through or not, we don't know, you can't plan for it, and we would, of course, always tell you, when, when something is coming through.

Chris Pitcher (Managing Director)

Thank you very much.

Operator (participant)

The next question comes from Alicia Forry from Investec. Alicia, your line is open. Please go ahead.

Alicia Forry (Head of ESG and Alternative Investments)

Oh, hi, good morning, Brian and Tobias. two questions from me. I wonder if you could update us on the inflationary picture that you're seeing across the operating cost base, so beyond COGS. Any color would be helpful. On the A&P spend, I assume, given the market share performance that remains, you know, quite positive, that you're happy with the current rate of A&P spend versus sales. Should we expect any change in the growth rate of A&P relative to sales going forward over the near term? Thank you.

Tobias Hestler (CFO)

Okay. Tobias? Yeah. Look, on, on, on inflation, right? I think, let me maybe start with, with commodities. I mean, you know, some stabilization, but we haven't seen, you know, prices massively come down. Sugar prices, sorbitol prices, still very, very, very, very high. Packaging comes down a little bit, but, I mean, still, you know, way off before the inflationary happened where it where it was. I think outside of that, I think it's mainly mainly on, on people. We just need to see where where inflation rates where rates are. I think as you've seen, I think we have strong operating leverage in half 1. We were able to to offset that.

I think from that point of view, I think the ability in our model should be able to, to offset, offset that through pricing and efficiencies. On the A&P spend, look, in half... I mean, first of all, I think we're happy with the level we are in percent of revenue, so we don't think there is a major shift in any direction. We increased our consumer-facing A&P spend, 8%, if you exclude Russia, where we stopped advertising last year. I think we, you know, healthily invested into the brands, and we would ex- you should expect us to continue doing that going forward.

Of course, I mean, if you have a year with 10-ish sales growth like we had, you wouldn't expect us to spend A&P ahead of that ahead of that ratio. I think you spend heavily, and of course, we also look for efficiencies in the in the non-consumer-facing A&P spend as well.

Alicia Forry (Head of ESG and Alternative Investments)

Thank you.

Operator (participant)

The next question is a follow-up from Iain Simpson from Barclays. Ian, your line is open. Please go ahead.

Iain Simpson (European Consumer Staples Equity Research)

Thank you. Thank you so much for allowing me to follow up. I'm going to be cheeky and ask another two questions, if I may. Firstly, could you just remind us how we should think about working capital seasonality? Something to get our heads around with you being a relatively new company. Typically, we see working capital kind of as an outflow in the first half and then an inflow in the second half for most consumer companies. Would, would you be any different, or how should we think about that? Then secondly, in terms of your efficiency program, you're talking about some quite large numbers in terms of gross savings for that efficiency program. You also just said that you think A&P is in the right place as a percentage of sales.

I was just intrigued as to how we should think about where those efficiency savings will be going. Will they be reinvested back into the business? If so, where, given your comments on A&P, or what proportion of them might fall through to the bottom line medium term? Thank you so much.

Tobias Hestler (CFO)

Good. Thanks, Ian. Let me start with working capital. I think, yes, I think we probably see similar pictures that you, that a-as you mentioned. I think for us, particularly, I think in, in half 1, we've always see working capital outflows, and that's largely driven by us building cold and flu inventories ahead of the, you know, the big season sell, and that's that's in in Q3. Of course, this year it was a bit more pronounced given the strong sales growth. Just to give you a color, I think our day sales outstanding actually have improved so from 55 to 50 days in half 1. I think this year is a bit more pronounced given given the strong seller.

You would always expect, you know, working capital outflow half 1, and then I think it's reversing out in the second half of the year. I think as a result, our cash flow, free cash flow, by the way, you saw it last year also, what we did between separation and year-end, you would expect a much stronger free cash flow performance in the second half of the year, yeah.

Then while, while I'm at cash flow, just I think, for you to note, as I had guided, I mean, of course, this year, first time we have the interest, interest cost, cash out, because the payment of the interest is arrears. That has normalized, and also the cash tax has normalized, because we, we had a benefit in before. Both, as I had guided, guided you for half one in.

Brian McNamara (CEO)

Iain, on your question on the efficiency program, as, as we previously communicated, GBP 300 million, majority of which will happen in 2024 and 2025. I think Tobias' comments on AMP were certainly for this year, we feel like it's in the right place. The reason I say that is, you know, we'll provide guidance at the year-end on what that looks like. This GBP 300 million certainly gives us the flexibility to understand what is the best way to move forward. If there's more growth opportunities to go after, we have the opportunity to look at that, if we feel like we get the right returns. If not, then, you know, there's an opportunity to use those funds in other ways.

It's really about the flexibility of that, but certainly as we get into, you know, the end of this year, we'll give more clear guidance next year on, on where we think that will come out.

Iain Simpson (European Consumer Staples Equity Research)

Thank you so much.

Operator (participant)

The next question is from Olivier Nicolai, from Goldman Sachs. Olivier, your line is open. Please go ahead.

Olivier Nicolai (Head of Consumer Staples Research)

Hi, good morning, Brian, Tobias, and Sonia. Just two questions on my side, please. First, a follow-up on China and Sensodyne. The growth last year for Sensodyne was affected by the lockdowns for oral health, I mean, in general, was affected by the lockdown. How are we compared to pre-COVID levels? Is there still much of a catch-up to be done in China for oral health? Secondly, question is more for Tobias on this one. You're obviously expecting a stronger growth for this year than the beginning of the year. Your cash flow tends to be much stronger in H2. You've done 1 disposal at a really good price, and the bulk of your debt is in dollar, which is weakening.

Could we expect your net debt to be down, to be below three times, maybe at the very beginning of 2024, which would still be within the guidance, or even at, at year-end? Thank you.

Brian McNamara (CEO)

Good. Let me, let me start on China. Yeah, we, we are seeing, like I said earlier, we are seeing a little bit of softness in that, in that category. Again, our, our negative category were slightly less negative than that, so we had to see share growth in the most recent periods. We do expect it to stabilize. I mean, it was a certainly a dynamic that began towards the, you know, second half of last year. In the back half, you know, we're hoping to see that category, expecting to see that category more stabilized and us being in a position where we can get back to, to growth on the business. Tobias?

Tobias Hestler (CFO)

Yeah. On, on the leverage. I mean, look, we've guided to less than three during 2024. I think doing, you know, the divest, I think, gives us, you know, increases, increases that confidence that, that we get to that place. I mean, as you mentioned, yes, there is, there is currently a benefit coming through on the, on the, on the, on the, on the US dollar debt. Also, remember on the, on the leverage side, it goes against the adjusted EBITDA number, and on the adjusted EBITDA number, you take the currency, the translational currency hit as well. I think there is a bit of an there is a bit an offset. I mean, over time, I think, this evens each other out, but it really depends on exactly where it lands, if you get...

You never get like 12 months or 12 months. In the long term, I think we've broadly aligned our currencies of debt with the currencies where we have our earnings as we spread the debt across the U.S. dollar, the euro, to small extent, the pounds and the Chinese renminbi as well.

Olivier Nicolai (Head of Consumer Staples Research)

Thank you.

Operator (participant)

The next question comes from Bruno Monteyne, from Bernstein. Bruno, your line is open. Please go ahead.

Bruno Monteyne (MD and Senior Analyst European Food and Home & Personal Care)

Hi, good morning. Toby, I just want to come back to something you said earlier. You say investors wouldn't want to see AMP grow above the 10% organic or sales growth. I don't really recognize it's investor sentiment. I think if you are able to grow AMP ahead of sales growth, we invest some of the operating leverage in more AMP and actually further strengthening future growth, I'm pretty much sure that most investors would actually be happy about it. Was it just a short-term observation? How do you think about it in the medium long term?

Tobias Hestler (CFO)

Yeah. Thanks, Bruno, and look, so thanks for, for checking back, right. I think, it was meant as a short-term comment, right? I think when we get, you know, benefits, strong benefits, short-term coming through from cold and flu or the benefits from China, right? I think that's not where you pump in more money to, to deliver that, right? I think long term is, I think, exactly what Brian said, what's said before. Of course, you know, keen to invest, keen to invest in AMP and looking for the growth opportunities that we have, in the business there.

Bruno Monteyne (MD and Senior Analyst European Food and Home & Personal Care)

Thank you.

Operator (participant)

As a reminder, that's star followed by one on your telephone keypad to ask a question. The next question comes from Tom Sykes from Deutsche Bank. Tom, your line is open. Please go ahead.

Tom Sykes (Managing Director of Equity Research)

Yeah, morning. Thank you. I just wanted to clarify some of the things you were saying on, on APAC and the APAC margin, because I think the, the minority is up by quite a lot. I think the minority is up by 60% or so, which I thought the majority of that, if not all, was the JV you had in China. Yet that's obviously a long way above what the organic operating profit increase was for the APAC region. Could you just explain, and I know you gave some other points in the slide on APAC, so thank you for that. Could you just explain what, what is happening to profitability outside what is included in that JV?

Maybe could you just remind us what is what of that pie chart you gave, what, what goes through that JV, which comes out in the minority, please?

Tobias Hestler (CFO)

Yeah, sure. Sure, Tom. The joint venture in China has the, has, has the over-the-counter medicines business in it. It's about a third of the sales in China, so it's really the OTC sales that go through that. Of course, that's where you had, where we had in half one, the major, the major pickup in revenue, because on both Fenbid and Contact, which were the ones that were, you know, blocked, blocked before, and then you had the massive demand coming through, that we're able to meet, given our local production footprint there, and also the, the, the production footprint is also in that, in that joint venture. I think really strong support locally to run the production 24/7.

That means that, of course, part of that upside, we have to share with our JV partners, and that's why you see that up, that, that increase in the, in the, in the minority. That, of course, is predominantly in, in half one, where that's, where that stepped up, right? I think the, the JV doesn't share, you know, for example, cost allocations on the standalone costs and so on, that are applied to the overall region. That's why you get a difference in the overall region margin picture compared to what sits in the JV as part of the JV agreement. I think it's a bit, you know, unusual in half one, just given that strong Fenbid and Contact growth coming through there.

Tom Sykes (Managing Director of Equity Research)

Okay, thank you.

Operator (participant)

As a final reminder, that's star followed by one on your telephone keypads to ask a question. As we have no further questions, I'll hand the call back to Brian McNamara for closing remarks.

Brian McNamara (CEO)

Great. Thanks, everyone. Appreciate your time and questions. As, as we've said, we feel great about how the first half has gone, and we're confident in the outlook that we laid out today. Hope you all have a great summer, and if you have any further questions, feel free to reach out to Sonia and the investor relations team. Thanks again for your interest.

Operator (participant)

This concludes today's call. Thank you very much for your attendance. You may now disconnect your lines.