LPKF Laser & Electronics SE

Welcome to our call for the first quarter from LPKF. My name is Bettina Schaefer. I'm head of investor relations and your host for this call today. All participants have been placed on a listen-only mode. The conference will be recorded and published for a period of two weeks on our website after the call. The presentation is available if you click on handouts. And we have published our Q1 report today. Gerd Spendele and Christian Witt will give you a very quick overview of the business development in the first quarter and on our current situation, including the corona challenges. After that, we are ready for your questions. Before we start, I would like to point out that any forward-looking statements are based on estimates and on information currently available. These forward-looking statements are not to be understood as guarantees of future performance and results. Ladies and gentlemen, I now give you Götz Wendeler.

Hello, everybody. Well, once again, thank you for joining us and welcome to this call. I'm happy to share our Q1 results with you. Talk a little bit about where we're at as a company in this situation also against the coronavirus Pandemic as well as the economic crisis that currently goes along with it and also speak a little bit about what have we done in terms of new technologies in the last you know a few months and Finally give you a little bit of an outlook of where we're heading as a company Christian will then discuss the figures in a little bit more detail and And after about half an hour, we'll like to open this for questions.

So let's see. No, I can't. Here we go.

I can move the presentation. So the presentation, of course, you have seen, I think, a lot of the pages. So I won't go through the whole thing, but I will comment at certain points about where we are with respect to certain parts of our business. Overall, and you'll see this at the bottom right, we've had a weak quarter. We've actually lost money for the first time in quite a while in the quarter. However, this was part of our forecast back in February, and it's actually driven almost entirely by seasonal demand. We have two large customers that typically place fairly large scale orders with us. The timing of those orders has always been, I would say, somewhat coincidental. There would be some such orders in a quarter and not in other quarters. Typically, our overall business is somewhat weak at the beginning of the year. We last saw this two years ago with a similar and low start into the year, slow start into the year. Last year, we did not because we were delivering orders, prior orders for those two customers, large orders. So what we've done is we've looked at the revenue without any revenue contribution from those two customers. And then what we find is we're actually just slightly above the first quarter of last year for all revenue other than from those two customers. And if I look at it by segment, then I'm roughly in the same range. A couple of segments are a little bit below, a couple of segments are a little bit above last year without the large customer orders. So while this is unpleasant, of course, the fact that we have a weak quarter and we've lost some money, This is not an indication of the overall situation of our business. However, of course, in addition to that seasonality, we have to at least consider, I think I should say, the effect of the coronavirus pandemic on our business. And I'll explain this to you in the next few minutes. I think the seasonality is pretty straightforward, as I explained. So without that, we would have been essentially flat, which, of course, is still not enough in the growth plan that we had for this year. But at the same time, it is also not an indication of a decline in business due to coronavirus. The pandemic has affected us in an indirect way and in a very moderate to moderate degree. We have seen a few postponements of orders. Basically, where customers said, well, our factory is closed right now. We can't really take the delivery. We'd like to take it in two, three, four months. Why don't we expect our factory to be open again? We have not had any order cancellation in any of the business units. And also not in any of the regions, which is, I think, noteworthy. In China, where from a timing perspective, we are the furthest along with the crisis where the country has more or less reopened. Certainly has more or less reopened anywhere outside Wuhan and Hubei province. And even there, through this whole process, we have stayed in touch with our customers. We have continued discussions about projects. and we have not seen any . Rather than give you just a general picture, I'm going to go through the presentation which many of you know. And I think I don't have to say much about megatrends or the drivers of our competitive advantage. They haven't really changed since I last spoke in this group, really only six weeks ago when we had our annual report, our annual results. Same with the global situation. So we have four business units, development, electronics, welding, and solar that serve somewhat different markets and industries. So I'd like to comment as I go through the presentation a little bit on how the current situation looks like in each of those segments. And of course, this is driven by the different nature of those industries. R&D is largely driven by budgets, government budgets, and similar budgets. Consumer electronics is, to some extent, driven by demand, but also very strongly driven by innovation. In that part, we haven't seen much of a slowdown. Automotive, of course, had slowed down long before the pandemic. The entire second half of the last year, the overall industry was slowing down, even though it did not affect LPKF as being driven largely by innovation in this sector. rather than capacity expansion solar is pretty long term we haven't seen much of a change in demand or comment on this a little bit further down the road semiconductor and medical also are not strongly affected by the pandemic except by individual let's say project delays just tactically when sites are closed development flat for the quarter year on year, relatively low level, typically strongest quarter is the fourth quarter, weakest quarter is the first quarter. That was the case last year and it is the case this year. So the result is not great, but given the fact that in China, most entities and most locations of customers were closed from late January through Chinese New Year and then through a good fraction of March or the end of March, that's actually the bad sign at all. We anticipate that this business will not only be stable and profitable, but will exhibit some growth during the year, corona or no corona. The electronics business of course has a number of parts. We have the Let's call it classical part where we are talking about cutting printed circuit boards and creating PCB stencils. In that area, we have had, I would call an okay start. We have had, again, we have not had any major postponements of orders. We have been quite a bit stronger in stencil laser than in PCB cutting, just on a relative scale. Overall, this business has exhibited, I think, in conversations with customers, the pause that I described for China, obviously in China from late January, Chinese New Year, all the way to about the middle of March, when conversations have moved more decisively towards orders. Order generation has also picked up again since then, especially in China. We see initial signs for this in the rest of the world, which for us is mainly North America, Europe and the rest of Asia, Japan, Korea and Southeast Asia as well. But it's quite early to really say that there will be a global recovery in this segment very soon. We do expect this to happen, but whether it happens already in May, June or a little bit later in the year, that remains to be seen. For the LIDE applications, a lot of the current business is engineering samples. We've seen a short, a fairly short break in this flow. That was from around, that was in March. That has stopped now. We have, once again, a fairly steady set of engineering sample orders that are coming in. You may recall that in January we published that we had installed the First, specially designed and manufactured systems, a system for use, for automated use in the semiconductor industry, which is under evaluation to be qualified in this sector. So that's one group of applications in this segment. Another one is, okay, I think everybody knows the fact it's a two-step process to create very thin structures, very fine structures in thin glass. laser treatment plus etching, which then gives you a much higher quality than using just the laser alone, nevermind using mechanical means to shape glass. This is, yeah, here's the semiconductor application or one semiconductor application. Another application, of course, is the display industry. This is something where conversations for us are quite interesting, whether it's a non-folded display. I mean, this pencil cut that you see here is essentially the type of display that many, if not most of us are using in their smartphones. So this is a very high volume application where we can simplify the process, enhance the quality of the final product, the glass product, and reduce costs and processing time. No, I can't. Christian, please don't move your mouse. I can no longer move. Ah, here we go. Oops, now I'm having too many of these. Okay, sorry, we're using this application for this platform for the first time. That apparently is a learning curve. I apologize for that. Foldable displays, again, something we are in discussions with potential customers, and these are very interesting discussions for us. something we expect growth eventually by also making the screens from foldable from thick glass and reducing the breaking point, if you will, to the extent possible, making these foldable displays harder to break. A new application I want to talk about a little bit more today is microfluidics. You may have heard me speak about this in the past. It's essentially circled around our ability to create very tiny wells in glass wafers or glass plates. The well size can be as little as five microns. with an extremely high density, and as you can see on this picture, very consistent and high quality. This can be used for various analytical or pharmacological applications, including things like single cell analysis or DNA analysis, which in life science is often referred to as omics. So cellomics, genomics, et cetera, the generic term. So this was something that we had seen as an application, and because of that, we have developed it in the meantime, in a relatively short period of time, into an application, into a new business that we have launched in April, so technically not first quarter, but it was actually launched about a week and a half ago, which is called Arraylize, a combination of array and analyze. Consists of essentially two parts. It consists of the material, the glass plate, if you will, with small and customizable well features made out of glass, which of course is an inert material, which has the advantage that there's essentially no leakage of any unwanted compounds or molecules into your actual sample, which is enabled by our V3M technology. So we do this with the light glass structuring process. and have started now to market these materials however the materials by themselves are really only one side of the equation the other side of the equation hold on does this work now yeah the other side of the equation is the machine that can um the machine this is the workstation which you see on this slide it's um it's a tabletop workstation that can handle nanoliter and picoliter volumes of very very small volumes um including the capability for live optical analysis of samples. For example, you can analyze optically whether a single cell that is in each well that after being treated is whether that cell is alive or dead. For example, for a cancer cell, this would be of high interest. Those of you who know our products well will recognize that this machine has some semblance to the ProtoMats for prototyping of printed circuit boards, and that is no coincidence. The frame and the machine platform of this we use to develop this machine. Obviously, the innards of the machine are quite a bit different, but having the development business and having the LIDE Vitreon business enabled us to develop this new business, the total solution consisting of the workstation platform as well as the materials, both of which are new in this field. We were able to do this in a timeframe of a few months at a very reasonable cost. And this speed to develop new solutions from what we have, plus ideas from inside and outside the company, plus development as needed to bring something to market quickly. This ability is what we as LPKF intend to strengthen further down the road. And the more of these innovative ideas we can launch commercially quickly and in a way that it is well received by customers in different industries, industries already active in or as in industries that we have not been particularly active here. The initial plan to launch this, by the way, was to do it at the ACA meeting, the American Cancer Association meeting, the largest meeting of cancer researchers in the world, which happens once a year in April. Of course, the meeting was canceled because of COVID-19, so out of necessity, we did this soft launch. We've started the website. We've started conversations with potential customers, but of course, there won't be any live trade fairs for the immediate future. Anyway, so Aeralyze, you just, you know, you can look up on the web, www.aeralyze.com. That's us. You will see content about this. Welding, I'm not going to go into great detail about welding. The automotive industry is one of the target industries. We do see, obviously, our customers are suffering. No question about it. I mean, anybody who reads the press regarding to the automotive industry is well aware. That suffering to a large degree actually predates even the COVID pandemic. For us, last year automotive was actually a strong market because our sales into this industry, so typically tier one, sometimes OEM, but mainly tier one customers are driven by innovation and not by capacity expansion. At this point, again, we didn't have a cancellation here, but I would say the project pipeline within the automotive space is a bit slower than it would otherwise be. That's for sure. At the same time, we haven't heard about postponements or cancellation of major model launches. So new models that are supposed to be launched in 2020, to date, they are still going to be launched in 2020. that might change but so far it hasn't and I don't immediately expect that either. So innovation will continue, capacity expansion will not continue for the time being but frankly hasn't been going on to a large degree even before the coronavirus impact on the automotive industry. The other part of the welding segment Medical and consumer electronics is doing better. So overall, we don't see a large drop off in the project pipeline here either. Finally, solar. Our solar business is driven by selling complex and large systems, relatively high price tag solutions to a few customers in the thin film solar space. We are in close contact with those customers. We don't see any change in the invest pipeline. I think the consensus in this industry so far is that the shift from fossil to non-fossil will not really be impacted at least not in a meaningful way and not in a sustained way by COVID-19. We have had one order to China that was supposed to be installed in March postponed. As you can imagine, the installation is now going to take place somewhere between June and August. Not a big deal. The only thing that can happen here is that orders that are scheduled for the end of the year might switch and shift into the beginning of next year. That is something that can occur here and obviously would affect the 2020 annual slice, if you will, of our revenue. But structurally, I don't see much of an effect for solar. I think at this point, I would hand it over to Christian, who will say a little bit more about our figures, and then I'd like to open it up for questions. Thank you. Christian?

Thanks, Scott. Welcome, everybody, also from my side. I will guide you through the financials of first quarter, and I'd like to start to have a look back, 2019. finished up with 140 million sales with 19 million profit. For 2020, we have not given the guidance yet, quantitative guidance. We will do so whenever the range of what we see as an outcome for the particular slice in the year 2020 has been, when those range has become somewhat smaller. For 2024, we do explicitly confirm the guidance we have given because as Gertz mentioned, the fundamental drivers for the market demand for our products and solutions have not changed and is not changing through the COVID-19 crisis. And that is true in the businesses where we are strong in today and will further grow. as well as for light and vitrine business on new businesses like Airlines, which might even benefit from the current difficult developments in the world. Looking in particular at the group figures for first quarter, the revenue has declined by about 46% as expected due to the large orders. which have been delivered in Q1 19, but not in Q1 2020. The EBIT is slightly better than expected. And the reason for that, I mean, the key driver behind the decline in EBIT is the volume decrease that is clear. We have slightly better margins, gross margins here on the product side than we had with the larger orders last year. So that is why we have a a slightly better gross margin, a better effect here on the EBIT. On the free cash flow, we do see impact of the loss as well as the impact of the temporary increase in our inventory, which we've done in order to secure the prompt delivery to our customers. And we will keep that inventory throughout Q2. On the order situation, The other intake as described is quite similar to what we have seen last year. It's low. It's always low fast in first quarter. Nevertheless, we would have liked to see larger order intake there to get to the growth figures which we are aspiring to. The low orders in hand are mostly due to the timing of the solar orders. um particularly like we have seen it last year when we look at more in more detail at the at the revenue side um we do see the effects uh which got already described um in electronics and welding uh for one of the larger customers and then solar of the for the second of the larger customer slash order uh which we've uh which we've had there in uh Q1 2019 development is relatively stable. And we also have the shift from one medium size order by the customer from Q1 2020 to what's most likely Q3 with bits of good luck, we will get it out in Q2. It's ready from our side. As soon as the customer requests the good, we will ship it and which collects the money and so forth. Looking on the effect on profitability, that's basically straightforward and same thing across all segments. The lower EBIT is due to the lower volume and the fixed cost we have is roughly on the same level as we've seen that last year. We have initiated quite a few measures on cost savings. But those will, most of them at least, will take effect as of Q2, at least for the largest part. These cost measures include cost measures as a true saving measures in expenses. And that includes certain items like travel costs or how much you clean your buildings and so on. It's a typical GMA type savings program. What is very important about that is that we will save on where we can do good service for our customer for less money. What we will not do is jeopardize or cut anything which is the basis for our growth for tomorrow. And that's the same for cost and is the same as an investment when we talk about LIDE. The second part where we have started savings is the whole We have applied for and started short-term work in the German locations. We've done that with a very low rate and with a clear focus on the administrative part, the DNA part, where we've asked people to stay home a small percentage of their time. For us, more important than the immediate cash effect, which we will see, and the savings, is that if the crisis becomes more pronounced, we are able to react very quickly. If we have bumps here and there, like a few weeks where we want to halt production or to want to halt something, we can do that very flexibly. But on the other hand, we can ramp up any area to full capacity within one week. And that is probably unprecedented and very fast response time we have implemented together with our employees and the Works Council and gives us the flexibility to save money on the one hand and on the other hand to react very quickly wherever necessary. As mentioned, our focus there is very clearly the G&A part. not production, not sales, not service. Looking at the cash flow, what's the key points? Number one, in the operational cash flow, the loss is due to, as mentioned, the two key facts. One is the increase in inventory, and number two is the loss we've incurred. So that is the key part. We plan to reduce the inventory again in Q3 and we also plan to reduce the working capital as it was our initial endeavor and plan in the year 2020 versus the year 2019. So in the end of 2020, I want to have less working capital in the company than in the end of 2019. These plans and the project are unchanged and they are on track. So we do expect to reach that. Focus, as mentioned, there would actually be inventory with some improvements in the other positions. The investments here include industries in the leader factory, which we are building here in order to not only offer our solutions in terms of machines, but also to offer directly the glass product to our customers. either in their design or in our design that depends on the different applications. As mentioned before, we are not jeopardizing or reducing any investment into future technology, development, sales efforts, or other things where we are improving the company. And since we are well positioned in terms of our positioning in the market, in terms of profitability, not in Q1, but in general, and in terms of our cash position, net cash position, we can afford to do that, and we are doing that. I wouldn't have wanted to be in that situation like two years ago. That would have been a different conversation. Today, we are in the position where we are because we've improved these things in the company, and this is why we can act this way. and further create value for LPKF and its shareholders. We come to the guidance for 2020. For financial year 2020, as mentioned, that depends very much on the timing and the recovery speed of the global economy. And it depends to some degree in some segments on capacity buys how fast will certain things be how how deep will people buy more wearables or small electronics devices than before or less we don't know but that those things will will depend it will impact the slice of 2020 will a certain model be on the market uh two months later or not Will a certain factory in China, which we want to equip, will that be ready on time, or will that be ready two months late? That's basically the factors which, where we need some more certainty, and then we will give a guidance. For Q2, we have clear visibility, and we are giving the guidance of 28 to 33 million euro, with an EBIT of 1 to 4 million euro, depending mostly on volume. The outlook for the following years up to 2024 remains absolutely intact and unchanged. As mentioned previously, all the fundamentals of our business are unchanged. The markets and key demand drivers are unchanged. Some of them, which Gretchen mentioned before, might even be stronger than before. We shall see that. That is basically the plan we're executing to reach that growth in our conventional or today's existing established business as well as in the different light applications or new applications what we're working on. And we expect for 2024 to reach the 360 million plus revenue and the 25% plus in EBIT margin. From my side, that's the part of the financials. And then we would open up the floor for questions.

Great. So, ladies and gentlemen, we are ready for your questions. Please click on the hand signal if you want to ask a question. Please click on the hand signal again if you want to withdraw your questions.

Okay then.

The first question comes from Alina Köhler. Please go ahead with your question.

Yeah, hello there. I just have a quick question on order intake. Could you give us a rough indication of how much stems from Asia in the first quarter?

I look up the figure. I'll give you the figure later. That's okay. Qualitatively, we have seen quite a good development in China. The demand, customer conversations and so forth have continued throughout their key lockdown period in COVID-19. We have even received orders from that time. We have continued negotiations on other larger orders. So what we see there was actually okay and quite ambitious. We do see an uptake now in the activity. I'll get the figure to you.

Thank you. The next question comes from Lucas Spang. Mr. Spang, you can ask your question now.

Sorry, I had to unmute myself. So good afternoon together. Two questions from my side. The first question is about the mentioned postponement of a mid-sized order you talked about. Can you a little bit quantify what you understand of a mid-sized order?

A mid-sized order is something... Go ahead, Christiane. A mid-size order would be something above a million and below five million.

Okay. And then another topic is the capitalized costs were about half a million higher than in Q1 2019. Is this for the remaining quarters also the level we should anticipate or will it go down again?

The expectation is that capitalized R&D might be a little bit higher than last year. Not necessarily all year on the full level, which we have seen in the first quarter. It's not something which can be planned so easily. That's the trend we see. We have not changed the policies or the methods or the rates.

Okay. Thanks.

The next question comes from Robert Jan van der Horst.

Hi, thanks for taking my question. So, a couple of questions, if I may. The first ones would be on the solar segment. So, I think the last larger order was in August last year and that will become effective, like you already mentioned, mainly in the second half of the year. I was just wondering, I mean, Are there, do you expect significant orders in the short term here? And if, what would be like the latest date you need an order intake to let it at least in part contribute to this year's revenue? So that would be my kind of my first question. The second one on the light technology, I mean, I could imagine that especially getting new leads has become more difficult right now and with a lot of R&D departments, if your customers being in home office or something, I could see some postponements here. Could this lead to subsequently later orders also for the ramp up, which time span could you, I don't know, deal with to still keep your 2024 target and what kind of postponements would then pose a threat maybe to the midterm guidance? Thanks.

Yeah, thanks, Robert. Well, let me answer your second question first. We don't actually see a slowdown really of the, let's call it customer activity, which could be engineering samples, conversations about larger larger orders or contracts, we don't see a slowdown of this. For the engineering samples that require things to move physically, we have seen a short slowdown, but we are talking about a few weeks. And that's not, you know, that business is not, for example, as China centered as a lot of the rest of the electronics is. um so that slowdown was largely in march but it has resumed now uh we definitely don't expect any lingering delays that would then trigger follow-on delays further down the road and there is no reason to believe that so that's the that's about lied about solar um the the bulk of the revenue actually uh quite a bit of revenue will will i mean you've seen with um forecast higher revenues in the second quarter and there is a solar component to that as well. And then the rest of the solar is obviously in the second half. We have a pretty clear visibility on what solar revenue we have for this year. The only remaining uncertainty is There are some machines that we are planning to deliver in November, December, where in theory, if construction activity of, for example, the factory where those tools go into was delayed now, that could go into January, February. That would obviously show up this year, but on the grander scale of things, a delay of one, two, or three months is not really something that we worry about too much. Other than that, new orders for solar Even if they came in today, it would be relatively hard to fulfill this year. It would still be possible, but it would be tight. But Solver has a pretty long lead, as I've always said.

Okay, perfect. Thank you.

The next question comes from Anne-Margaret Crowe.

Good afternoon. Thank you very much for taking my questions. I've got a couple of questions, one of which has partly been answered already. And this is a question, have you seen any impact on your ability to actually ship product at the moment, given that there's fewer airplanes in the skies at the moment? And is the travel restriction having any impact on your ability to close big contracts with customers? So that's the first one. And then the second one, there's a reference in the reporting accounts to your competitive position improving as a result of some of the measures you've taken to address the COVID-19 situation. Why do you feel that your competitive position has improved over the last few months? Thank you.

Yeah, thank you, Anne. The first question or answer to your first question is we only see a very limited impact on shipping machines. Actually, freight traffic, air freight traffic is the availability of air freight traffic is quite a bit better than the ability for people to fly all over the world these days. Prices are quite volatile, so they go up and down, but we have been able to ship everything that we wanted to have shipped in the first quarter and now in April as well. Travel, of course, is a whole other story. We cannot send our sales folks or our service folks around the world, at least not very easily. And so two things to work around that. One of them is we try to do as much as possible online. This could be, obviously you can have conversations online with customers, especially if it's not the first time you talk to a customer. But you can also do things like sampling, demonstrations of our solutions here in Garbson or at another one of our locations where otherwise the customer would come to us. Well, now the customer can't come to us, so we do it via live video. And, you know, we've been able to do that. We can even do this with a picture quality that's a bit better than what you would have on Zoom. And that helps. And that's something that customers appreciate. You know, they might ship the sample and then we demonstrate how we process their sample live. That's going quite a long way, especially since we're not the only ones who have been affected by this restriction. I mean, if, you know, people could go anywhere else, but not to us, that would be a problem. People not being able to go anywhere, people find workarounds. Even with this, we have been able to do a fair amount of service work remotely. Either we send a local colleague to the customer. If we have LPKF employees in the country, that person might not have the same technical skills and communicates with us live. Or sometimes we ask staff from the customers to do that, and we have done a lot of service work on that. And I think this way of working with our customers, something that will linger on, maybe not linger on, maybe it'll persist. It's probably the better term after the crisis is over. Because if you have a pretty high quality way to be served without somebody showing up, that has some advantages. Lower cost, you don't have to wait 24 hours for somebody to fly halfway across the globe. And if it can be done that way, that's great. Now, other things... There are always some things that you cannot do remotely. To install a machine, somebody has to actually do it. It's probably not the customer. But so far, we have been finding workarounds in most cases. Clearly, when the customer's location is closed, then you wait until it reopens. That's not something you can easily find a workaround. Then you have one of those delays that I mentioned earlier. I think that's one of the things that you asked. The other thing was, a bit more general around competitive advantage.

Yes.

The report was something that we believe by being very proactive in the way we move as much of our activity online and by being extremely flexible in the way we organize ourselves in this crisis, we should be able to react faster than others especially faster than those companies who are less financially stable than us, whenever demand resumes. And, of course, this is based on the assumption that demand will resume at some point in time. And that, we believe, might lead to a competitive advantage. I think it's an indirect effect. It could still be a meaningful one.

That's very helpful. Thank you very much.

You're welcome.

So the next question comes from Alina Köhler. Alina, do you have another question? No, sorry. I just forgot to put the hand down. I'm sorry. Okay. And then I can still see a hand signal. No, there don't seem to be any further questions at the moment.

I'm going once.

Then let me give some idea to Alina on her question on the order intake coming from Asia. It's actually more than half of our order entry in Q1.

And that's from Asia or China?

Asia. And the majority of that is China. The clear majority. It's not all of it, but it's the clear majority.

Thank you very much. You're welcome.

So if there are any further questions, please click on the hand signal. The next question comes from James Ogilvie, but I cannot unmute you, Mr. Ogilvie. Can you unmute yourself? Where can I? This is very strange. I can unmute everybody, but I cannot unmute you, James, for some reason. It says self-muted. I'm sorry about that. You will have to send us your question by email or we will have to call you. After this, or maybe, I mean, there is this, at least on my screen, there is this little microphone similar.

It's quite small on the top right, which is either red or green.

I don't know if you see this, Mr. Ogilvie.

Offline now. But I still cannot change this.

Okay.

I'm sorry about that, but there don't seem to be any further questions at this moment. If there are questions, you can always contact us via email. And therefore, I would like to thank you very much for joining this call. Sorry about the few technical problems we had. We will be better next time, I promise. And the next regular conference call will take place on August 5th. at the release of our half-yearly report. Thank you very much and goodbye.