Premier Foods plc

Good day and thank you for standing by. Welcome to the Premier Foods Q3 Trading Update conference call. At this time, all participants are on the listen and on the note. After the presentation, there will be a question and answer session. To ask a question during the session, you will need to press star and one on your telephone. I must advise you that this conference is being recorded today, Thursday, the 20th of January 2022. I would now like to hand the conference over to your speaker today, Alex Whitehouse. Please go ahead.

Thank you very much and good morning, everyone. Thank you for joining this, which is our quarter three trading update call, and it covers the 13 weeks to the 1st of January 2022. I'm also joined this morning on the call by Duncan Leggett, our Chief Financial Officer. So I'll give a quick overview of our third quarter trading and then I'll hand over to Duncan to talk about our financial outlook that we've provided this morning. And then, of course, we'll open the call to questions. So today's headlines are that we've had a really strong Q3. So it was ahead of our expectations and also ahead of the guidance that we've issued. And we've also outperformed in all of our categories, leading to a significant increase in market share. And now with three strong quarters delivered and good momentum continuing into the final quarter, we're today increasing our profit guidance for the full year. We now move on to look at some of the key figures that make up this morning's statement. So Q3 group sales increased by 7% compared to two years ago. And so that brings year-to-date group sales to 7.3% ahead on the same basis. That strong momentum that we have in the first half of the year flowing through into quarter three. Now, you'll recall that this year we're measuring ourselves against two years ago as well as one year ago, and that's given the exceptional elevated consumer demand that we saw last year when out-of-home eating was restricted. So we're essentially looking to be making two years' progress versus two years ago. And we provided both comparison bases in the RNS this morning, just as we did in quarter one and quarter two. On the one-year basis, group sales were 1.8% lower when compared to that inflated year-ago base, and that was, in fact, ahead of some of the expectations that we know were out there, which were around minus 3%. Now, once again, the key driver of the performance has been our brand. Our brands grew by 11.3% versus two years ago. So that's the equivalent of two years of five and a half percent growth back to back. And it was broad based across the brands with grocery growing at 11.2% and sweet treats at 11.6%. So very similar growth rates on both parts of the business there. And, of course, that great brand performance continues to be driven by our branded growth strategy. So leveraging our great market-leading brands and bringing highly relevant new products to market, which are based on our in-depth understanding of consumer needs and trends. We also continue to support our major brands with engaging and meaningful advertising and marketing campaigns, and then strive to deliver excellent in-store execution through our strong retail partnerships. And whilst those strong retail partnerships and that great execution is always important, it's obviously especially so in quarter three and the run-up to Christmas, because that quarter, of course, is our key quarter in terms of sales. Yes, again, we've invested behind many of the brands in the quarter. So we have Bisto, OXO, Mr Kipling, Bachelors and Ambrosia, all benefiting from TV advertising in the run up to Christmas. And during the quarter, we also brought to market several new products, a number of which were based on the ongoing consumer trends for healthier eating and plant based products. And these include ranges such as the Bachelors meat free pots and a new low salt version of Paxo stuffing. In addition, we also made our first step into biscuits with the Mr. Kipling Signature Range biscuit launch and introduced a range of ice creams under Mr. Kipling and Ambrosia brands. And when you take all this together, it means that we again outperformed all of our five main categories. 3.5% ahead of the market overall and we increased our market shares in each one and collectively that's a 90 basis points increase in market share. And we see this as a significant outperformance that reflects the strength of our brands, our proven brand growth model and the strength and depth of those customer relationships. Now, I've also previously said that we've worked hard refining our e-commerce proposition to ensure that our products are well marketed on the retail online platforms. So I'm very pleased to say that this continues to deliver for us as we again outperformed the online channel. We gained 240 basis points of market share online in the quarter. And again, these gains were across all our categories. Our online growth was, in fact, over 90% compared to two years ago, and the online channel in our categories was up 75%. If we look into some of the detail behind the brands that have driven what was such a good quarter for us, firstly, Bisto, our leading grocery brand, saw sales growth of around 11% versus two years ago. And that was helped by some really great execution in store in the run-up to Christmas, but also by consumers trading up to our premium range, which is Bisto Best. And that's very much in line with our growth strategy for the brand. Charlotte's cooking sources and accompaniments also had an excellent quarter, both in the UK and overseas. And that was driven by increases in distribution. And also the Charlotte's 30% less fat range continues to perform very well. And we also recently launched vegan variants of our two best selling flavors of Indian cooking sources. And as you'll be aware, over the last few years, we've been expanding our range of healthier products, and it's a very important part of our innovation and growth strategy, as well as our new ESG strategy, which you might recall that we launched in October last year. And the new ESG strategy includes plans to double sales of products that meet high nutritional standards and triple sales of plant-based products by 2030. Now, the fastest growth rate, once again, was Nissin's Sober Uncut Noodles. They've continued on their very strong trajectory. And as we've said before, these products deliver incredibly well on authentic product quality. And it's this which drives a strong repeat purchase, which then translates into exceptional sales growth. So compared to last year, sales were up by 62%, and against two years ago, by over 150%. And Bachelors also performed very well in the quarter with copper soups and pot snack ranges in particular driving the growth. So, in fact, overall, in that quick meals and snacks category, we gained a very healthy 380 basis points of market share between the Bachelors and the Nissin brands compared to two years ago. Moving on to our sweet treats business, here we increased our branded sales by 11.6% compared to 2019 and also by 6.3% compared to last year. And in fact, Mr. Kipling enjoyed its best ever Christmas with growth in the UK of 16% compared to two years ago and 7.5% compared to last year. And the brand's really continued to perform really well following its relaunch a few years ago. And it's on track actually this year for another record year of sales. Cadbury Cake also delivered double-digit sales versus two years ago with both the core ranges like mini rolls, but also some of the new products like fudge and crunchy cake bars contributing strongly to growth there. In the fourth quarter, we also see the expansion of the cake bar range, building on the success of that fudge and crunchy cake bar launch with the launch of Oreo cake bars, another very well-known Cadbury brand product. In non-branded, you'll remember that we've made some conscious decisions to discontinue some low-margin contracts, particularly in sweet treats, and focus on growing our brands. And in grocery, some of our food service business has yet to fully recover versus two years ago, although I should say that Charnwood Foods, which was our frozen pizza-based business, did actually deliver sales growth compared to last year. But overall, sales of non-branded products were 6.4% lower in the quarter compared to last year and 8.9% lower versus two years ago, again, as we focus strongly on our brands. Moving into the international business, I'm very pleased to say that we continue to make good progress and Q3 sales increased by 33% versus two years ago. Sales in all of our focus markets, Ireland, Australia, US and Europe, all saw growth compared to two years ago and sales were a little lower than last year in Ireland and that's due to lapping the pandemic related elevated volumes so very similar dynamics there to the UK but also in Ireland the impact of some stock building that took place to protect service in advance of the new EU exit And you remember in Ireland that we're also continuing to apply that proven branded growth model from the UK. So we've got further new products that went into market in Ireland and we also advertised Mr Kipling and Bisto again on TV in Ireland. So that's the second year now in succession as we again work towards implementing the full UK branded growth model in Ireland. And in Australia, Mr. Kipling increased its market share and grew ahead of the cake category in the quarter. So all in all, a really positive quarter, I think, for our international business. Lots of good progress. And as we go into quarter four, we'll now see the start of the Mr. Kipling test in the United States. And this, of course, coming on the back of that successful test that we had in Canada. So I'm now going to hand you over to our CFO, Duncan, who's going to summarize a few points on our guidance from this morning's announcements.

Thanks, Alex, and good morning, everyone. So as we enter the final quarter of the year, with the benefit of three strong quarters of trading behind us, including, as you know, the all-important Q3, we're now in a position to upgrade our profit expectations for the year. So what does that mean? So we're saying adjusted profit for tax is expected to be at least $125 million, and that's driven by improved outlook for trading profit, which we expect to be at least $145 million. Now, as a reminder, we reported just over 115 million for adjusted PVT last year. And this actually was a decent step up from 93 million the year before. So we're looking at least a 34% increase compared to two years ago. And then just for reference, we're seeing consensus for adjusted PVT of around 119 million coming into today. There's a fairly narrow range of a million or so either side. So in terms of sales, within consensus, around the 900 million mark for the full year. We aren't expecting an update to our sales guidance today. We've always known, and I guess just as a reminder, the end of this quarter four, would you believe it, marks the two-year anniversary of the elevated consumer buying volumes just before we entered lockdown restrictions at the start of the pandemic. And additionally, you'll have seen our leverage levels become much more normal over the last 18 months, And our deleveraging is expected to continue this year as the net debt EBITDA ratio progresses towards a one and a half times medium term target. So with that overview, in terms of how we see the rest of the financial year, I'll hand you back to Alex.

Thank you very much, Duncan. So Duncan has just touched on guidance for this year, but as we look further out, I just want to reiterate that we continue to see opportunity for further significant value creation through the deployment of our five-point strategy that I shared before. So firstly, continuing to drive growth in our core UK business, that's utilising our branded growth model, which we know works so well for us. And so, as you'd expect, we have a full pipeline of new products all ready to go for next year, which we're already working through the launch plans of over the next couple of months. Secondly, investing in our supply chain infrastructure to increase productivity and efficiency. And as you might recall, we have plenty of capital projects in the pipeline that have got attractive payback periods. The third pillar is then expanding into new categories in the UK, and again, deploying our proven branded growth model, but over a broader base of categories. And as you'll be aware, there are several examples of initial steps we've taken here. So in the last few months, we've launched the Cape Herbs and Spice range, Mr Kipling Biscuits, And we've also now got those ice creams under Ambrosia and Mr. Kipling brands. I'm just going into market now. Quarter four are Ambrosia ready to eat porridge pots. So that's a step into breakfast. And that's a meal occasion where we commonly don't play at all. So it's a wide space in terms of opportunity. So clearly lots of activity going on in terms of new category extensions. And then the fourth pillar is building our international businesses towards critical mass. And as you've seen today, the overseas business is going really well. And as I say, in quarter four, we've got the start of that Mr. Kipling test in the United States. And then the fifth lever in the strategy, of course, is looking for modest bolt-on acquisitions to broaden the portfolio. So just as a wrap-up from me then, we're very pleased. We've had a very strong quarter three driven by that very strong performance from our brands. We've come in ahead of our original expectations and the guidance that we'd given of around 5% to 6% growth versus two years ago. and we've outperformed all our categories and made market share gains across all of them. And as a result of all that, we're upgrading our profit guidance for this year. So all in all, I think we're in really good shape, both for the rest of this year and also now as we start to look forward into the next financial year. And so with that, I'd like to thank everyone for your time. I'll stop there, pass back to the operator, and we'd be very happy to take questions. Thank you.

Thank you, Alex. Ladies and gentlemen, as a reminder, if you wish to ask a question, please press a star and one on your telephone and wait for a name to be announced. If you wish to cancel that request, please press the hash key. So once again, it's a star and one on your telephone if you wish to ask a question today. We have a couple of questions. questions coming through. Your first question today comes from the line of Charles Hall of Peel Hunt. Please go ahead.

Morning, everyone. Well done on an excellent quarter. A couple of questions. Firstly, on marketing spend, you obviously had a pretty comprehensive plan for marketing in H2. With the outperformance in Q3, are you thinking about increasing your marketing spend or you feel that you're spending enough already?

So I think we've made a commitment that we will continue to increase our investment behind our brands over the medium term. And we fund that obviously through the growth in the business and also the expansion of our gross margins in the middle of the P&L and all that. cost-saving initiatives and efficiency programs we have, Charles. So that continues. As far as, you know, quarter four is concerned now, really, you know, the die is cast, if you like. So what we plan to spend in the last quarter of the year is essentially now in train and so therefore will not change.

And obviously, you've mentioned the supply chain difficulties with aplomb given the operating forecasts. But do you want to comment a little bit about what's going on in terms of delays on shipment, your ability to operate the plant, labor cost inflation, raw material price inflation, and how you're dealing with all of that? Yes.

Yeah, sure. Lots of elements to that question, Charles. So I think, you know, you'll remember from our previous statement that as we were coming into quarter three, which is obviously our key quarter, we'd taken a number of actions to make sure that we could protect our ability to ship. So we'd worked making sure that we got competitive rates for our HGV drivers. And that ensured that we got enough resource to get products out to our customers. We deliberately shipped some volume early in order to take the pressure off the peak weeks, which for us is that last couple of weeks of November into early December. And all that worked for us really well. And our customer service levels held up. held up pretty well over Christmas and we understand very favourably to a lot of other manufacturers. So we're pleased with how that played out. As far as manufacturing is concerned, you'll remember that our plants are fairly automated, particularly on the grocery side, so we're not relying on an enormous amount of low-cost labour. It's fewer more skilled technicians, if you like, running computerized lines in the majority of cases. Just like in the broader environment, we saw some absence due to the Omicron wave, but we're very much the other side of that. And a little bit like the overall environment, those absence levels have come right back down now. um overall um ring ring good shape and and obviously our peak period is is now behind us and we got over it very nicely so feeling pretty comfortable In terms of inflation, the same story applies, as I've said before, really. We have a process for managing inflation. We look forwards and see how we think it's going to affect our input costs. And we look to offset where we can through savings and hedging as well. And then we increase our prices and change our promotional plans where we then need to. And we've been doing that through the year. And as a result of which, as you can see today, we're – you know, we're on top of it and we're in good shape.

That's great. Thanks, Alex.

Thank you. Your next question today comes from the line of Nicola Millard of Investec. Please go ahead.

Hi, morning. Just following on... Hi, Nicola. Hi, morning. On your comment there about, obviously, the leaders you've been calling to deal with inflation, I mean, is the sort of Q3 beat to... any extent due to pricing, if you've already moved on price through the quarter or changed promotional patterns, maybe less deep promotions. So just wondering if that beating Q3 was price-led rather than volume-led. And also an update is on the areas where you've gone into new categories. So you mentioned Kipling Biscuits and Ice Cream as well for Ambrosia. How are those products performing in the market? Thank you.

Yeah, sure. Thanks, Nicola. So, yeah, on the inflation point, I'd say, look, you know, the beat today comes from the fact that sales were a bit better than we expected. So we'd said that we expected to be in that 5% to 6% range, and we've come in just over 7%, so that helps. And then what we've seen is quite a big positive mixed benefit. So you've got a mixed benefit between branded and non-branded, so that really strong growth versus two years ago from the brands, you know, really driving a strong mixed benefit. There's also a bit of mixed benefit between the brands as well. And then operational efficiency as well in our ongoing cost-saving programme. So all those things really playing into that. And, you know, it's not really price-driven insofar as price is really just cancelling out the input cost inflation. And... If we move on to new categories, I'm hesitant to say because it's obviously very, very early days. But, you know, when you first go into a new category and you're sort of playing around with the, you know, with the mechanisms and the promotional plans and all those sorts of things. But at this stage, I can say we're very pleased with how it's going. But as I say, it's really early days.

Okay, that's great. Thank you very much.

Thank you. Your next question today comes from the line of Martin Deboe of Jefferies. Please go ahead. Your line is now open.

Yeah, morning, everybody. Questions, one on the new profit guidance and just what that means, and secondly, one on pensions. So just trying to understand your confidence on profit and the moving parts. You know, it looks, from what Duncan said, end the year in sort of low $900 million of sales. So you've lost about $40 million of sales relative to last year, which, so you've lost gross contribution of probably about $15 million. But you expect your trading profit to be sort of $6 million at the most. So you've really found benefit, you know, of something like $10 million. And I just want to try and understand where that's coming from, just to understand how the moving parts of profit are moving. And the second question is, I know the update isn't about pensions, but I just want to be reminded of the pension schedule, not the buyout, which is, you know, a hypothetical we can't time. But when is the next triennial valuation happening? You know, are you going to disclose the latest actuarial valuation? And if so, when? So those are the questions.

Those both sound like questions for the CFO to me.

Thanks, Alex. Morning, Martin. Thanks very much for your questions. So, yeah, I think on your first one in terms of profit guidance, I mean, there's probably a few bits to call out. you know, continuing mixed benefit of branded versus own label. Generally, you know, particularly on a two-year basis and obviously, you know, keeping reasonably close on a one-year basis. I mean, we are seeing, you know, we are seeing lower COVID-related costs year on year. We don't see all that benefit because obviously it offsets our bit of a volume leverage benefit in there. I think probably the other main point is our continuing sort of cost efficiency programs. I mean, we are pretty relentless on everything that we chase down, particularly in the supply chain and the factories, and the team are doing a fantastic job at continuing investing both with sort of capex around deficiencies, trying to improve yields and various other bits, particularly on the sites, which is all performing pretty well to plan. And then just picking up on pensions, so as a reminder, the last triennial valuation was March 19. There's a requirement that following our pension scheme merger, um that there was another um you know needed to be a valuation within a year of merger so there is a valuation of the premier food scheme ongoing at the moment so that's as of march 21. um and that's still that's still ongoing and we'll announce the results of that uh once it's concluded and then yeah to your point on the tri-annual valuation the next valuation the triangle valuation which includes obviously the rhm sections as well is that march 22. That will be when we get a bit of a progress update around how the RACM scheme is progressing versus projections and how far and close it's getting towards buyouts.

Okay, thank you. All very clear. Thank you very much.

Thank you. Your next question today comes from the line of Clive Black of Shore Capital. Please go ahead.

Good morning, guys, and very well done. Two questions, if I may. First of all, can you give more color about the focus of your supply chain efficiency work that you referenced, Alex, just, I guess, self-evidently where it's been applied? And secondly, I just wondered if you could comment on your expectations for the relationship between necessary price recovery at the moment and volumes as we go through this calendar year. Would you expect volume to respond across your categories to cost recovery.

Thank you. Yeah, sure. Thanks, Clyde. So, look, in terms of supply chain efficiency, I mean, it's an ongoing program that we've talked about before. There are opportunities remaining that are really a hangover from when we were much more constrained from a cash and capital point of view. So we've still got opportunities for automation. So simple examples where we might be manually packing, manually handling cases to create a pallet at the end of a production line before it goes off onto a truck. And if you look at the economics of putting an automatic case packer on there, you realize that it pays back very quickly indeed. So we have an ongoing program of continuing with that automation. And then there are all the obvious efficiency things that one would look to do all the time anyway, so minimizing waste, Big focus on reduction, on understanding our consumption of energy and a lot of additional metering going into sites to understand how and where we consume energy and therefore how we can reduce it and all these things all add up at the end of the day. So that's probably the biggest indication I can give you. Sorry?

Thank you.

Yeah, that's good. In terms of the relationship between price and volume, it's a really good question. So we have some pretty sophisticated price elasticity models. And whilst at the end of the day, of course, the retailer controls the price to the consumer, we can simulate what we think might happen when we increase price. our prices through to retailers. So we model the impact of headline price, promotional pricing and frequency and volume and look to optimize that triangle, if you like, before we start talking to retailers about the price increases and changes we want to make. Now, the interesting thing, though, is that, you know, if you're in an inflationary environment as we are at the moment, what happens psychologically, we know, is that consumers ultimately adjust to a higher pricing environment. So in reality, the elasticities play out to be rather better than your model would usually suggest. But, yeah, the teams are all over that.

Cool. It's not something that you're overly concerned about at the moment in general? No.

No, not particularly. When we look back in time as well and when we see consumers under financial pressure, we find that our brands tend to benefit. So whilst you might get, there clearly will be people who are constrained in terms of their weekly expenditure, but at the same time, you also then get people who decide not to go out for dinner on Saturday night and to eat in. So we tend to benefit more from the latter than the former.

Excellent. Thank you very much, guys.

Thank you. We do have one more question on the line, but as a reminder, if you wish to ask a question, please press star and one on your telephone. Your next question today comes from the line of Doriana Russo of HSBC. Please go ahead.

Yes, good morning and congratulations on strong numbers for the quarter. I've got two follow-up questions. The first one is related to the international sales. I was wondering what's in the pipeline and what is the expectation for the full year. There was some reference that some of the sales were coming ahead of time. Shall we expect international to be weaker in Q4? and also what are the expectations for the medium term in terms of growth there. And my second question is related to the market performance. You mentioned that you gained overall 90 basis points in the quarter. Where is the gain coming from? Can you give us a little bit more color whether this comes from the groceries or does it come from the strong international safe. Is it a UK number? International number can just give us a little bit more information in terms of where these market share gains are coming from. And lastly, in terms of if we look at sort of in medium term, the guidance for FY23, given your confidence in being able to offset the inflation that is impacting the industry at the moment, Shall we expect further progression of trading profit ahead of top line sales? So what sort of expectations shall we take into account? Thank you.

Sure. Thank you for that. So firstly, on an international, so no, wouldn't expect it to be weak in Q4. I mean, I think we need to take a longer term perspective on the international business. We've been quite clear the strategy here is to build international business units with their own critical mass. which is essentially a transfer from what was an export business to now building brands and building business units overseas. So the medium-term outlook, as you asked the question, as I've said, is that we intend to make the international business several times the size it is today. And I think the progress that we're making at the moment is the steps on that journey, and they will continue. So I won't go through all the different actions across the different markets again, but if we want to, we can always go through that offline. As I say, there's a handful of focus markets, there's a couple of focus brands in Kipling and Sharwoods, and we continue to make really good progress on the development of those brands in those businesses. In terms of the market share gain, so the market share gain, you say, was it UK? Yes, it was. That's a UK number, that 90 basis points. And did it come from grocery or sweet treats? It came from both. So we took market share in both. And in fact, we took market share in every single category that we operate in. So all our five core categories improved their market share, and it was pretty strong performance across the board. And not a massive surprise in the sense that we deployed the same model, of course, in all the categories. So our brand growth model and the innovation programs that we've got are equally deployed to all the categories. In terms of medium term and next year and profit, I think probably the best thing I can say is, you know, the increase in guidance we've given today is not a spike. I think it's the establishment of a new base that you can consider as being, you know, the base to start from this year as we go into next year. So, yes, we'd expect to make further progress against that as we go into next year. Does that answer those questions?

Yes, thank you, Gary. Okay. Back to your question on, sorry, to your comments in terms of market share gains. Is this on the expectation that you're going to continue to invest behind the brands a little bit more year on year, or is that on the expectation that the overall category will continue to grow? You're driving the category just to give us a sense of where your investment is going to be skewed to for the following year, please.

Yes, of course. So there are two things here. I think, firstly, let's understand where the market share gains come from. So the reason why we take market share is because we drive growth, and we drive growth for the category. And that's one of the reasons why we're able to work so closely with retailers is because What we're not trying to do is take a market share point from a competitor because we're the leader in all those five categories. All our five core categories, we're the leader. And what we look to do is drive value growth for the category. And in doing so, because the value growth comes from us, mathematically, we end up taking market share. But it's not because we're trying to steal it, if you like, from another player. And then if you look at investment going forward, so what will happen is, and I think we've been quite clear on this, is we will continue to deploy the branded growth model. And the branded growth model obviously consists of further innovation, further new products based on our strong understanding of consumers. Yes, it includes investment behind our brands and includes further working closely with our retail partners. Now, on the investment piece, You know, what we've said is that over the medium term, we will continue to increase our marketing investment behind the brands, and that will be funded through a combination of top-line growth, but also increased gross margins, which come as a result of all our internal cost-saving and cost-optimization programs.

Thank you.

Thank you. We do have one more question at this time. This comes from the line of Charles Hall of Peel Hunt. Please go ahead.

I'm just following up on Doriana's question on international. Can you give a bit more colour on how Canada is assuming as it's moved from trial into rollout and also a bit of information on where you are with the trial in the US in terms of how widespread that's going to be?

Yeah, sure, Charles. So Canada, yeah, so we're really pleased with the results. But you might remember that we then, based on what we learned, we made a couple of tweaks to the product offering. And in particular, we changed the pack size. So in the original test, we had eight cakes per pack. And in the rollout, we're going to be having six cakes per pack. And that's really because if it's a new brand and a new product, it's less of a barrier to get in to buy six than it is eight is a bigger commitment, if you like, for something you've not tried before. And so those products have been manufactured, they've been shipped, and they are now just getting to shelf in Canada. So at that point, I would expect to see an increase in rate of sale, as all our research and the test findings suggested, but I can't touch and feel it yet because it's only just literally happening now. In parallel, we are now talking to companies other retailers. So we're talking to the existing retailers to extend distribution beyond the test stores, and we're talking to new retailers about expanding into their stores where we clearly weren't because they weren't part of the test. So it's all sort of in play, Charles, if you like. As far as the U.S. is concerned, so the product is in America and is expected to get onto shelf in the test stores in the next few weeks. So by the time we get to the announcement in May, hopefully we'll have a bit more understanding of what's happening there. But I've got nothing to report yet because we haven't got to shelf yet. That's just about to happen.

Perfect. Thanks.

Thank you. It appears there are no questions at this time, but as a reminder, if you wish to ask a question, it's a star and one on your telephone. There are no more further questions coming through. Back to you, Alex.

Okay. Well, thank you, everybody, for dialing in, and I hope everybody has a great day. Thank you.

That does conclude our conference for today. Thank you all for participating. You may now disconnect.