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spk00: Thank you for standing by, ladies and gentlemen, and welcome to Grinrod Shipping Holdings Limited second quarter 2022 financial results call. We have with us Mr. Steven Griffiths, interim chief executive officer, and Mr. Carl Ackerley, chief operating officer of the company. At this time, all participants are in a listen-only mode. There will be a presentation followed by a question and answer session, at which time, if you wish to ask a question, please press star 1 on your telephone keypad and wait for the confirmation tone indicating your line is in the queue. I must advise you that this conference is being recorded today. I will now pass the call over to one of your speakers. Mr. Griffith, please go ahead.
spk04: Thank you, operator. Welcome, everyone, and thanks for joining our call today on the second quarter and first half 2022 financial results. Let me please refer you to slide two with the forward-looking statement disclaimer. On this call, we will make certain forward-looking statements, including statements regarding our future financial and operating performance. These statements include information regarding future time-charter contracts, outlooks for the dry-bulk market, and other operating matters. These statements are based on the beliefs and expectations of management as of today. Now, actual results may differ materially from our expectations. Investors should carefully read the risks and uncertainties described in slide two of this presentation and in yesterday's press release, as well as the risk factors included in our annual report and our other filings with the SEC. We assume no obligation to revise or update our forward-looking statements, whether because of new information, future events, or otherwise, except as required by law. In addition, during this call, we will be discussing certain non-GAAP financial measures. Additional disclosures relating to these non-GAAP financial measures, including reconciliation to the most directly comparable GAAP measures, you see yesterday's press release and pages 23 to 25 of the slide deck, which was posted on our website and our filings with the SEC. Please turn to slide four for an overview of our second quarter and first half 2022 financial results. Grinrod Shipping reported another record quarterly performance with a strong second quarter of 2022, reflecting the resilient markets in our Handy Size and Supermax Ultramax driver carrier segments. For the second quarter of 2022, our gross profit, adjusted EBITDA and adjusted net income increased materially year over year, achieving $64.6 million, $73.9 million, and $53.3 million, or $2.81 per ordinary share, respectively. For the first half of 2022, our gross profit, adjusted EBITDA, and adjusted net income increased to $105.3 million, $124.1 million, and $83.1 million, or $4.42 per ordinary share, respectively. As of June 30, 2022, we had cash in equivalent of $160 million and restricted cash of $9.7 million, an increase from December 2021 due to our strong results. I will go into more detail on our financials later in the presentation. Please now turn to slide five to look at our operational highlights and recent developments. On June the 1st, 2022, we sold a 2016 bulk medium-range product tanker, the Matupu, for a gross price of $30 million. This was the last tanker in our fleet, and the sale represented an opportune moment to complete our exit from the product tanker sector as asset prices strengthened in this sector. On May the 10th, 2022, we exercised the purchase option on the chartered-in 2015-built Supermax bulk carrier, the RVS Tarnherd, for an amount of $18 million, with delivery to us on July the 25th, 2022. The vessel remained chartered-in at the original contract rate until delivered to us. The overnight shipping has four remaining purchase options which you will find on slide 22 of this presentation and which provides information on our long-term chartering vessels and associated purchase options. On May the 12th, 2022, we agreed to extend the long-term charter on the 2014 built Supermax bulk carrier, the RDS Crimson Creek, for a period of 11 to 13 months at a charter rate of $26,276 per day commencing May the 1st, 2022. On August the 17th, 2022, our Board of Directors declared an interim quarterly cash dividend of 84 cents per ordinary share, payable on or about September the 19th, 2022, to all shareholders of record as of September the 9th, 2022. The dividend is our highest to date since we initiated our policy in Q3 of last year, and we are pleased to continue returning material capital to our shareholders in these robust markets. Now we'll go over to the financial highlights and performance for the second quarter and third half of 2022. Turning to slide seven. In the second quarter of 2022, revenue increased to $161.6 million compared to $108.4 million sorry, $109.8 million for the same period, 2021. Revenue increased due to improved market conditions in the barbell business, which was slightly offset by a reduction in short-term operating days and the sale of the medium-range product tanker, Matuku, in the second quarter of 2022, compared to no shift sales and continuing operations for the same period in 2021. Gross profit increased to $64.6 million in the second quarter of 2022 compared to $35.6 million for the time period in 2021. Net profit attributable to owners of the company increased to $56.8 million or $2.99 per ordinary share in the second quarter of 2022 from $22.8 million or $1.08 18 cents to ordinary share in the second quarter of 2021. For the first half of 2022, revenue increased to $271.9 million compared to $178.3 million for the same period, 2021. First profit increased to $105.3 million in the first half of 2022 compared to $48.2 million for the same period, 2021. Net profit attributable to owners of the company increased to $85.8 million or $4.56 per ordinary share in the first half of 2022 from $25 million or $1.30 per ordinary share in the first half of 2021. Turning to slide A. We have placed a priority on building a strong balance sheet and have maintained a healthy cash position while repaying $50 million of our debt in the second quarter of 2022, partly as a result of the sale of Matuku and its associated finance lease. This strategy has significantly reduced our net debt to $39.6 million while leaving us well-positioned to pursue our growth and capital return strategies. On slide 9, we provide our bank loans and other borrowings repayment profile at June 30, 2022. We continue to have limited debt maturities until 2025, which combined with a conservative amortization profile provides us with balance sheet flexibility going forward. Overall, we maintain low leverage. And this is even lower when you take into consideration the market value of our fleet. which is comprised mainly of modern Japanese-built ETO vessels.
spk05: Let's turn to slide 10.
spk04: We will now briefly discuss our drive-out operational performance for the second quarter and first half of 2022. Candy-sized TCE per day was $27,479 per day for the three months ended June 30, 2022. versus $18,104 per day for the same period, 2021. Supermax Ultramax TCE per day was $31,021 for the three months end of June the 30th, 2022, versus $21,916 per day for the same period, 2021. For the first half of 2022, Handicap TCE per day was $24,993 for the six months ended June the 30th, 2022, versus $15,285 per day for the same period, 2021. Supermax Ultramax TCE per day was $27,604 for the six months ended June the 30th, 2022, versus $17,606 per day for the same period in 2021. As of August 10, 2022, we have contracted the following TCE per day for the third quarter of 2022. For our handy size, we contracted 1,020 operating days at an average TCE per day of $25,127. For our Supermax Ultramax, we contracted 1,524 operating days at an average TCE per day of $26,766. The average long-term chartering cost per day for the Supermax Ultramax fleet for the third quarter of 2022 is expected to be approximately $14,921 per day. Now, turning to slide 11, the scale of the rise in the dry bulk freight rate is easily demonstrated versus our historical results. During the second quarter of 2022, approximately 90% of our fleet was predominantly trading either on index links cargo contracts, short-term time charges, or in the spot market, leaving our company well-positioned to take advantage of a strong freight rate environment. To put this into context, with every $1,000 change in TCE per day equated to approximately $10.8 million of TCE revenue during the full year 2021. And that's for the core fleet. As you can see on the graph, our fixtures for the third quarter are slightly lower than the second quarter, but well above spot market benchmark indices. Now turning to slide 12. It shows the core fleet cash break-even analysis for the first half 2022. Break-even per vessel per day was as follows. The long-term charter in, which includes net G&A, the cost was $15,336 per day. For our own fleet, it was $11,801 per day. And the combined average total for the core dry bulk fleet was $12,583 per day. The cash break-even rate per day includes operational expenses, net G&A, interest expense, and debt repayment. You can contrast these figures to the daily TCE rates in the previous slide to assess the robustness of our profitability. With that, I would like to turn the call over to Carl to discuss the dry bulk markets.
spk02: Thank you, Steve. Now, if you can please turn to slide 14 to look at the fundamentals of the dry bulk sector and how they've been developing against the current market environment. War in Ukraine has negatively impacted flows of certain dry bulk commodities, particularly in the grain and fertilizer sectors, while weaker economic conditions in China have reduced steel demand, a key driver to global dry bulk trade flows. The demand hit is being partially offset by longer required voyages as replacement cargoes continue to be sourced from further afield. This is demonstrated by 10 mile demand expectations that are still expected to increase by 1.2% in 2022, whilst actual tons transported are projected to be flapped year over year. The primary examples of this trade route substitution are in the grain and coal markets where buyers are sourcing alternatives to Ukrainian grains and European buyers are seeking alternatives to Russian coal, whilst Russia finds new export markets for its commodities. Please turn to slide 15. As the slide depicts, grain trade is expected to contract in 2022, primarily due to the loss of Ukrainian export cargoes. whilst the coal trade has been impacted as well due to some buyers avoiding Russian coal cargos and also increased domestic coal production in China. Lockdowns in China have added uncertainty, further weakening steel demand in 2022, which has negatively impacted the iron ore trade. Congestion has also eased, releasing more ships onto the market. Minor bulks, the key cargoes for our vessels, are expected to remain the lone bright spot exhibiting positive cargo growth during 2022. Decontainerization is also still a factor, albeit somewhat reduced from the peak of 2021. For 2023, expectations are for a return to growth in all the major dry bulk cargo categories. Turning to slide 16, the dry bulk order book continues to shrink to multi-decade lows, and is estimated at only 7.1% of the fleet. This potential growth, or lack of it, is quite favorable, especially considering approximately 23% of the dry bulk fleet is 15 years or older, and approximately 12% of the dry bulk fleet 20 years or older, measured by dead weight tons. We would also draw attention to the high fleet growth from 2008, peaking in 2012 and 2013. These ships will start to go overage from 2023 onwards, indicating an aging fleet. Despite strong market conditions, new ordering remains constrained by uncertainty relating to cost, practicality in terms of trading patterns and new fuel availability, engine technology and emissions regulations pertaining to EXI and CII. For 2022 and 2023, supply growth is forecast to be 2.7% and 0.7% respectively from the Handy Size and Supra Ultramax order books, which are the smallest in the dry bulk fleet. Sending to slide 17. Whilst handy-sized supermax spot TC rates have been volatile this year, they remain at healthy levels. Looking ahead, although the impact on the dry cargo market has been minimal, we remain prudent in our approach to risk management given the potential uncertainty. Looking at the chart on the right-hand side, handy-sized supermax asset prices are flat relative to the end of the first quarter 2022. They're down slightly from their most recent highs in late June. I would now like to turn the call back over to Steve.
spk05: Thanks, Carl.
spk04: Finally, let's turn to slide 19 for our conclusions and strategy. Let's start with our achievements in 2021.
spk05: Sorry, 2022. Sorry about that.
spk04: As reported earlier, the second quarter 2022 results were the strongest in over a decade as dry bulk markets remain strong, with nearly a four-time year-over-year increase in our adjusted net income. Our commercial strategy continues to demonstrate its potential, with material profits generated from both our long- and short-term chartering vessels, while we opportunistically exercise the purchase option on the RBS Pinehurst at very attractive levels using cash on hand. On the corporate side, we continued our flexible dividend and capital return policy in the second quarter, materially rewarding shareholders with a cash dividend of $0.84 per share, our highest since we commenced our dividend policy in Q3 2021. Now looking ahead, the war in Ukraine is disrupting the grain trade and other commodity flows due to the impact of Russian sanctions. The shipping demand has remained more resilient due to replacement cargoes being sourced from longer distances, increasing 10 miles. The smallest new building order book in decades continues to support market strength. In medium term, due to constriction in vessel supply growth, as uncertainty over engine technology and emissions hampers new building orders, particularly in the smaller vessel segments. New building orders in other sectors such as LNG and container shipping has limited the shipyard spare capacity, meaning that most new orders could not hit the water until mid-2024 or the earliest. To the extent that town mile demand continues to grow, the lack of available supply growth combined with EEXR environmental regulations in 2023 is expected to lead to an attractive potential multi-year window for the dry bulk market. With this, thank you all for joining our call today and look forward to reporting further progress on Boone Road. With that, we'd like to open for questions.
spk00: Thank you. At this time, we'll be conducting a question and answer session. If you'd like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 if you'd like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Thank you. Our first question comes from the line of Paul Fratt with Alliance Global Partners. Please proceed with your question.
spk01: Good morning, or good afternoon, wherever you may be. Start with the macro, if you wouldn't mind. Good morning, or sorry, hello. If we could start with the macro and, you know, you did a nice job of outlining what's going on currently and just the, you know, the positive impact on ton miles, even though volume's fairly flat. Can you look at 2023? You said it's a year of growth. Can you just highlight some of the risk factors that you're looking at in 2023?
spk02: I think you mentioned the macro factors and obviously we don't know what's going to happen with the Ukraine Russian situation and how that plays out. I think obviously a major factor will be inflation and what impact that's going to have on interest rates and people's spendability. But this will be offset somewhat by the new regulations on steaming, the EXI and CII. And, you know, the analysts indicate that they expect that there will be a return to dry bulk seaborne fleet growth, which, you know, over the years, historically, you know, runs at 2.5 to 3.5, 4%. And we've been flat this year. So I think the expectations are that it will pick up. Also, I think we must obviously talk to China. Again, it's very difficult to know what comes out of that. But all the China watchers are expecting the country to stimulate and measures are apparently already in place for that to happen. with the Xi presidential re-election due in November. And he'll probably want to start on a positive platform.
spk01: Great. And then if we could talk about just the super ultimates and the handies, you know, the relative rate strength has been pretty striking for several quarters, and especially in, you know, in recent months. Can you just talk about some of the factors that you're seeing there on, you know, I think previous calls we talked about congestion, you know, helping. It sounds like that may be easing a little bit. But, you know, container market tightness had pushed some cargoes into the dry bulk market. Do you see a lessening of that impact too? And can you just talk to, you know, currently where you're booking you know, both sectors and sort of what we should expect for the rest of the third quarter and then into the fourth quarter?
spk02: At the moment, the Atlantic's quite flat. The Pacific in the minor bulk trades, we're starting to see quite a significant pickup in the last few days. And after the This year has been a summer lull and quite a lot of uncertainty. It does seem that trade is picking up. And again, we talk to potential China stimulus. And I think overall, we're reasonably positive. Yes, the congestion may come out, at least in the short term. That may build up again. And there is a bit of steam coming out of the container markets. I think overall, I mean, whilst we see the FSAs for next year still heavily backwardated, we're confident that we will be in a profitable scenario. And I think it will be above, personally, above where the FSA is showing us for Cal 23. And you can see that in the period market, if we wanted to, put out ships on period, it is quite significantly above where the FFA market sits for Cal 23.
spk01: Okay. Sounds good. And then if we could just talk about operating costs, you know, some other companies have talked about higher operating costs, yours, your costs have moved a little bit, but not anywhere to the extent that the rest of the industry is, is seen as, And can you just talk about operating costs? And then also, it looked like G&A was a lot lower than what I expected. And could you just talk about SG&A over the rest of the year? Okay, yeah, I'll jump in here.
spk04: So OPEX, we have an internal target of OPEX on the basis of trying to be over time $5,000. We're still about that, but we have come down from Q1. it would probably come down to about $300, $400. But yeah, we continue to have some high self-repatriation costs from COVID issues, expensive floods. Yeah, it's difficult in this period to reduce it, but we're continually working on it, but we'd still like to be a little bit lower. The GMA costs, I mean, they are slightly lower than what we had in Q1. The one thing I would point out is it does include some stock-related incentive costs as a result of our improved bottom line. And these are variable costs, and they will reduce significantly if, say, the market turns and our profitability is not as high as now. But overall, I'm still looking overall on our cash rate even to come down from the current levels of $12,600, which is overall pretty much the same. You know, we've got the charter costs that are part of that where, you know, the conversion of those chartered ships to own vessels when we purchase and we exercise the purchase options, you know, they'll certainly result in a lower daily cash cost. And even more so if we don't take, you know, if there's no financing attached. You know, there's also a possibility that we may pay down some of our debt. And that would also reduce costs. Not really high on the agenda, but potential. It's a potential.
spk01: okay great that's helpful and you know are you i i built in a six percent tax rate it seems like that's you know your tax rate is going to be close to zero or was over the first half of the year is that something i should extend out or are you potentially going to have any tax on taxes over the second half of the year no no you can you you can expect it to remain you know
spk04: along the trend that we've had in the first six months.
spk01: And then the purchase options you highlighted, it looked like the Pinehurst got shifted into the third quarter, so that's $18 million in the third quarter instead of the second quarter. But the two Japanese, I'm going to butcher these names, but the Nuru and the Hayakita, those purchase options continue to go down, especially because of the yen-dollar relationship. When do you start to think about exercising those orally or doing something to lock in such an advantageous exchange rate?
spk04: Yeah, absolutely. I mean, in terms of our policy to hedge, You know, we wouldn't do that until we push the button and exercise the option. But in terms of timing, you know, as you said, the first vessel was exercised and delivered in July. We have board approval to do another two. So, you know, we're expecting to push the button on those soon. And then, you know, the other two, we're planning to exercise those, you know, late this year, early next year. So you can expect, you know, us to move on those pretty promptly. Another thing that I'd like to add, of course, is we purchased the townhouse debt-free. And, you know, the plan is likely that we'll do all of them debt-free. And, you know, this will contribute to our plan to reduce our daily costs on our fleet. Just one thing to bear in mind in terms of where our cash is now, the total cost of those four remaining ships is around $86 million. And, you know, all those option prices are well below the current market values.
spk01: Yeah, they look really attractive. So just to be clear that by the middle of next year, all four of those will be bought in.
spk04: Luckily, that's the plan. Yeah, that'll likely be done.
spk01: Okay. And that explains some use of cash, you know, especially, you know, given that your cash balance is, you know, called $170 million. It looks like the third quarter.
spk05: Yeah, yeah.
spk01: 170 million, that's well above, you know, the purchase options. It looks like the fourth quarter or third quarter, you know, it's going to be flat just a little bit because of the purchase option on the Pinehurst that you executed. But can you talk about, you know, the capital allocation going forward? And, you know, also, you know, the stock was a little bit weak, you know, went into the the mid teens, can you just talk about how you're thinking about stock buybacks versus dividends and versus, you know, in the context of, you know, the 86 million that you're likely to spend?
spk04: Yeah, that's absolutely. Um, yeah, so, you know, with the dividend and capital return policy, it's always a topic of, of discussion, you know, at board level. And, you know, of course, you know, we, we could increase our dividend at some point in the future, but our board is pretty happy with it as it stands, you know, with everything that I've spoken about, but very much on the agenda. Share buybacks, you know, we didn't do anything in Q2. You know, the low point in our share price is when we're in a closed period for reporting. So, yeah, in the weeks ahead, you know, we may well buy back some shares. Of course, it's share price dependent, you know, for that the shares in a, you know, in a position where we would probably consider buying back, but We've got approvals in place, and, you know, we will look at it in the weeks ahead once we go back out of closed territory for reporting.
spk01: Great. I appreciate your time. Thank you.
spk00: Thank you. Ladies and gentlemen, as a reminder, if you'd like to join the question queue, please press star 1 on your telephone keypad. We'll pause a moment to allow for other questions. Thank you. Our next question comes from the line of Francis Daniels with Anaboc Investment. Please proceed with your question.
spk03: Thank you very much, operator. I wanted to get a little bit more color on two things. First was on your comment about new orders not coming, hitting the water until mid-2024. What are you expecting post-2024, mid-2024, as the new orders are coming? Do you expect that the supply will be greater than demand? And I'm asking because of the impact of excess supply on shipping values. I think my second question relates to how to read the significance of the declining Baltic Dry Index number. It's been declining since about mid to end of May. I don't know if you have any thoughts on what that means for you.
spk05: Steve, shall I answer to this? Yeah, you go, Carl. I'm sorry?
spk02: As far as the new building orders, there are plenty of ships being built, but not in the geared and small drive cargo sector. The stats are in there in terms of the order book on the handy size and the super altars. There are two main reasons for that. One is that the yards are quite full with the sort of ships that can do new fuel or dual fuel engines. They're more lucrative to build, they're easier to get finance for and they tick the ESG boxes because they're perceived as being the right way to go in terms of decarbonisation or reducing your carbon footprint. So until the technology comes along to make it attractive for the financiers to finance it for the people who obviously big companies who are governed by ESG policy and we're all looking at ESG policy but big companies with the deep pockets are very much governed by it these days. Until this new fuel technology comes along that can fit into the handy ultra sector, it's difficult to see or predict that there's going to be a big uptake of new building when we're still building them with the old heavy carbon using engines. The economies are always getting better on those ships. They're getting more eco. But as of yet, no one's come up with the magic bullet on how you can afford to put on an expensive engine onto what is a fairly inexpensive ship.
spk05: And what was the next question, sorry?
spk00: I'm sorry, it seems his line has disconnected. Our next question comes from the line of Poe Fratt with Alliance Global Partners. Please proceed with your follow-up.
spk01: Yeah, I think the second question that he had was that, you know, can you talk about what you're seeing in the market for the Ultras and Supras and Handys relative to the dry, you know, the BDI weakness, you know, the Baltic Dry Index weakness?
spk02: Yeah. The BDI is largely governed percentage-wise by the Cape market. And the Cape market is pretty fully built. And it's driven almost entirely by iron ore and to a lesser degree, coal. And at the moment, China's appetite for iron ore growth in the iron ore imports is not there partly because they're leveling out in their steel production also because they now produce plenty of scrap which means there's less reliance on iron ore and they also of course they still produce their own iron ore so from that perspective we don't perceive that the cake market is going to have any big strengths in the near term and as I say, it governs the BDI. The BDI is much more representative of that market, whereas the minor bulk sizes have a smaller percentage of that BDI. We believe that for all the reasons I think we've already said, that the minor bulk geared sector will retain its strengths, and we can see that that sector has outperformed all markets this year.
spk01: Great. That's really helpful. I just had a couple additional follow-on questions. One is, can you talk about, you know, the dry docking schedule over the second half of the year? It looks like 166 days that you're anticipating. And then looking at 23, you're looking at 2,000, or I'm sorry, 220. Can you just talk about how firm that dry docking schedule is and maybe why the second half is heavier than the last couple quarters?
spk05: Yeah, look, in terms of the second half, it's
spk04: Yeah, there is going to be more money spent in the second half than what we have in the first. Yeah, it is quite materially higher. And what we spend in the second half is, sorry, in 2023, it's also higher. It's just that, you know, the way of the timing and the scheduling, it has been pretty low in the first half of this year. So we can expect it to be Yeah, roughly six, seven times higher. I mean, slightly higher than that in 2023. Okay.
spk02: I mean, I think it's worth adding there that, you know, we dry dock the ships every two and a half years. And, you know, the special survey is every five years, which is you have to dry dock for the special survey. You don't have to dry dock on the interim. immediate one but we do um just because we believe we get a better running ship like that we we we paint the holes we paint the hull um you know which is an environmental um requirement it helps ship go faster and stops uh whole growth so we we drive often when the schedule comes around on each ship but we do do it every two and a half years yep i just think that
spk04: Sorry, something to add there, Poe, is that, you know, we have had some scheduling in the first half of this year, but there's been delays in China. So that's also been a cause of there not being a sort of consistent flow through the year. So we are a bit loaded more than we would be in the second half of this year. And then 23 is obviously the expectation there is pretty much the same as what we spend over the course of 2022.
spk01: And then, you know, historically you haven't looked at scrubbers, you know, there's some in the industry that are saying that, you know, the dry bulk, you know, the non-capes or, you know, companies are going to start to look at scrubbers. Has your view on scrubbers changed at all?
spk05: I mean, yeah, we've
spk02: We didn't go for scrubbers. I mean, let's leave the environmental arguments to one side as to whether they're a good thing or a bad thing. You know, you get different opinions on that. But the main reason why we didn't go for scrubbers is because it's really overcapitalizing on what is a very nice Japanese modern eco fleet. You know, on the Ultramaxes, for example, everything that we have is 2014 onwards when the new ME engine came in, which gives greater efficiencies on your speed and consumption. So to go and spend $2.5 million on scrubbers and then all the costs of the scrubber maintenance to keep them working, we felt and still feel that that's not a necessary expenditure.
spk01: Okay. And then just one, if we could look at just the working capital flow, it looks like working capital flow changes were fairly positive in the second quarter. You know, I calculate about 20 million according to sort of the way I calibrate working capital within your cash flow. Just, you know, your reporting is a little different, but that's what I back into. Can you just talk about what working capital should do over the rest of the year? Was the second quarter a reversal of the first quarter working capital deficit? If you could help me understand what's going on with working capital.
spk04: Absolutely. It's very, very difficult to estimate what it's going to be at a point in time. You may be caught with a big outlay on voyage expenses or you know, at the end of, right just before the end of the quarter. Or you may have a time charter that's got to be paid, you know, for up to two weeks just before. It's very, very difficult to predict. But you're 100% right in terms of it was a reversal. You know, we've had about a $15 million reversal in Q2, you know, most of which went the other way in Q1. We do do our best to manage that. And, you know, close to the quarter end, we look at all of our outflows and our inflows and see what you can do. But some of them are just not, you know, they're unavoidable. It's just in terms of timing, you know, you have to pay certain costs on a certain date. But, you know, if you have a look over a long period of time, you know, the levels should be pretty much the same. So, you know, but I say manage it as best as we can. Perfect.
spk05: Thank you.
spk00: Thank you. Ladies and gentlemen, that concludes our time allowed for questions. I'll turn the floor back to management for any final comments.
spk04: Okay. Thanks, everyone, for taking the time to join our results call. And, yeah, you'll hear from us again in the next quarter. Thank you. Bye.
spk00: Thank you. This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.
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