Grupo Rotoplas S A B

Good morning and welcome to Grupo Rotoplas' results conference call. Please note that today's call is being recorded and all participants are currently in listen-only mode to prevent background noise. The host will open the floor for questions later. Today's discussion contains forward-looking statements. These statements are based on the environment as we currently see it and as such there may be certain risk and uncertainty associated with such statements. Please refer to our press release for more information on the specific risk factors that could cause actual results to differ materially. The company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, further events or otherwise. Please allow me to remind you that the company issued its earnings press release yesterday after market close. It can be found in the investors section of its website. Also, the presentation for the call and the webcast link are in the investors section. Today's call will be hosted by Mr. Carlos Rojas Abumrad, Chief Executive Officer, Mr. Mario Romero, former Chief Financial Officer and Board Member, and Mr. Andres Pliego, incoming Chief Financial Officer. I will now turn the call over to the speakers.

Good morning. Before we begin with today's agenda, I want to express my gratitude to Mario and warmly welcome Andres. Mario, your dedication over the past 30 years of Roboplast has been remarkable. Your leadership achieved significant milestones, from taking us public to issuing our sustainable bond, and your commitment to sustainability has left a lasting legacy. Thank you, Mario. We're deeply grateful and look forward to your continued support. Well, let me repeat, we're deeply grateful and we look forward to your continued impact on our code.

Thank you, Charlie. And good morning and good afternoon to those of you in different time zones. I want to sincerely thank Rotoplast and our entire team for an incredible journey over the past 30 years. It's been a privilege to work alongside such brilliant colleagues. Together, we've navigated challenges and celebrated achievements I'm truly proud of. I'm also grateful to our analysts and our investors for their trust and insights. As I continue to serve on the board, I am pleased to welcome Andres Pliegui. I'm confident he will be an excellent fit and will continue to execute Rortoplaza's financial strategy with dedication, keeping us on track toward our long-term vision. Thank you all.

Thank you, Mario. Let's begin by reviewing the key highlights of the war. After covering what happened and the reasons behind it, I'll shift. Excuse me. I'll shift our focus to the steps we'll be taking to improve profitability as swiftly as possible. It was indeed a challenging work. Similar to the previous two quarters, the harsh economic situation in Argentina impacted our results, primarily due to a drop in sales that has affected our profitability given the fixed cost structure we have in place. However, unlike in the previous quarters, while all other countries showed growth, in Mexico, our main market, we saw a slowdown in product sales due to heavy rains. We faced extreme rainfall, the highest in over 80 years in some areas, which severely reduced demand for our water storage solutions. We believe this is tied to weather cycles rather than market issues, but we'll monitor these patterns closely. I have no doubt these extreme weather events will continue. We need to be more agile and flexible in demand planning and supply chain management. This way, we can anticipate and adjust our costs to maintain greater stability in our operating results. Despite these headwinds, our services platform showed strong growth, driven by the expansion of VEDIA and the successful launch of VEDIA Smile, which has been well received by our customers. Argentina remains one of our greatest challenges. The country's challenging economic environment, marked by high inflation and declining consumer purchasing power, is impacting both the construction sector and our overall performance. However, there is potential for recovery. Inflation, though still high, is expected to decrease to around 65% by 2025, as fiscal and monetary policies take effect. The World Bank forecast Argentina economy will rebound with 2.6% growth in 2025, driven by improved agricultural exports and structural reforms. Given the current challenges, we already have made a strategic decision to optimize both expenses and investments in the coming quarters. Our goal is to maintain a strong financial foundation while positioning ourselves for the next phase of growth. This includes slowing down non-essential investments, prioritizing projects that directly impact margins, and implementing targeted cost-saving initiatives across our operations. Our strategic priorities are capitalizing on omni-channel and digital capabilities such as the VEVIA 3.0 platform and our e-commerce platforms for distributors in Mexico. Reversing the declining EBITDA trends by reducing expenses is our second one. And our third one, focusing on higher operating profit to increase free cash flow generation through working capital optimization and strict capital expenditure control while maintaining stable dividends and reducing leverage. As part of our ongoing review, we updated our 2024 guidance in response to the current market conditions. With a revision in September, Andrés will provide more details on this adjustment shortly. While we acknowledged the challenges before us, we're optimistic. We're confident that our strategy focused on operational excellence, sustainability, and our customer-centric approach will create value in the coming quarters. Our investment in technology digitalization and sustainable infrastructure position us well to seize emerging opportunities. An example might be the national water plan proposed by the new government, which aims to address Mexico's water management and distribution challenges with a strong emphasis on efficiency reduction and wastewater treatment. We remain committed to navigating these challenges with resilience, always focused on long-term success. Also, sustainability remains a top priority. I am proud to share that during the quarter, we transitioned to 100% renewable electricity and two of our main plants in Monterrey, adding to the two in Lyon, bringing our total to four fully renewable powered facilities. We've also improved our corporate sustainability assessment by S&P ratings, placing us among the top five globally in our industry. Additionally, with JP Morgan's support, we issued Latin America's first and the world's second SDID report, disclosing our impact in the UN's 2030 SDGs. Through the Rotorotas de Ayuda campaign, we donated over 1,400 water tanks to drought-affected communities in Mexico. Additionally, the Escuelas Con Agua program, in partnership with Coca-Cola Mexico Foundation, the eighth butler of the Mexican Coca-Cola industry, and Isla Urbana, is installing rainwater harvesting systems in schools to provide sustainable water solutions. Thank you for your attention. And now I'll hand it over to Andres to discuss the financial details. Andres, over to you.

Thank you, Charlie and Mario. And welcome to everyone joining us today. I am truly excited to embark on this new journey with RotoPlus. I look forward to collaborating closely with you all, investors, analysts, and stakeholders. And I hope to connect with each of you individually soon. To kick it off, and although Charlie has already highlighted the key points, I'd like to recap how things unfolded in the quarter. In a nutshell, the economic recession in Argentina significantly impacted our sales. And unlike the previous quarter, it was not offset by product performance in Mexico due to heavy rains. This combination of demand challenges in both Argentina and Mexico affected our ability to absorb fixed costs and expenses. Additionally, it's important to note that we have been investing in several digital and technological projects this year, while contending with rising logistic costs driven by global geopolitical factors. Finally, the weakness in our operating results was unable to cover our financial costs, leading to a net loss for the quarter. Excluding Argentina, our sales would have grown 4% in the quarter, On a cumulative basis, the group would have achieved an 8% growth rate. With that in mind, I'll quickly go over the key results, focusing primarily on margins, as we'll dive into more detail on top-line performance in the following slides. As for margins, we saw a contraction of the gross margin during the quarter due to lower revenues. However, on the year-to-date basis, we still see an increase thanks to our pricing strategy and strong sales of Tinaco Plus, which significantly boosted our margins during the first half of the year. For better comparability, we have included a table to analyze the impact of the FX hedging on gross margin. As shown, from January to September 2024, the margin was affected by 50 basis points. Our operating margin deteriorated both during the quarter and on a cumulative basis. This was primarily due to sales not meeting expectations, as previously discussed, with macroeconomic challenges and climate conditions playing key roles. In addition, logistical costs continued to rise, and we invested significantly in digital initiatives and marketing for BEVIA, all of which put further pressure on Moving on to performance by country, sales in Mexico grew by 2% during the quarter and 11% year-to-date, supported by growth in product sales and strong performance in the service segment. After record storage sales in the second quarter, driven by drought-related demand, the third quarter saw a shift as heavy rains reduced the need for water tanks and systems. Additionally, the wet season negatively impacted the construction industry slowing or halting activities, which in turn dampened demand for other water management solutions. EBITDA margins contracted primarily due to higher operating expenses and the softer sales performance in the third quarter. In Argentina, net sales decreased by 26% in Mexican pesos during the quarter and by 31% year to date. This decline is mainly attributed to the ongoing economic recession, which has impacted both sales, volumes, and pricing. However, in the third quarter, we saw slight improvement in volumes compared to the second quarter, indicating a slight recovery. Despite this, lower sales combined with dollars expenses continue to put pressure on markets. In the United States, net sales increased by 1% in Q3 and declined by 10% year-to-date, primarily due to lack of drought conditions and intensified competition. However, cost controls measures contributed to reducing negative EBITDA during both the quarter and year-to-date. While the EBITDA margin remains in red, it's gradually improving and moving closer to break-even. In other countries, net sales rose by 15% in the quarter and 7% year-to-date. In Peru, despite macroeconomic challenges, sales were boosted by strong demand for water heaters during a colder winter. Central America shows solid growth with Costa Rica and Guatemala performing well across the key categories of storage, water flow, and improvement. In Brazil, water treatment and recycling plants projects continue to expand, with growth in bookings and a more diverse client base. The decrease in EBITDA margins for other regions was primarily driven by rising operating costs, particularly in logistics and distribution. Additionally, development of water treatment plant business in Brazil added to the increased expenses contributing to the margin construction. In terms of products and services performance, the services segment now represent 8% of our total revenue. Within this area, we have made significant strides. BEVIA has greatly extended its reach, now serving over 127,000 users, demonstrating a strong growth in the consumer water solutions market. In August, we introduced BEVIA Smart, which has received excellent feedback. Customer appreciates having instant access through a mobile app to data on their water consumption and the quality of the water their families are consuming. By September, 25% of new subscriptions in areas where it's available have opted for this new smart service. RIEVO, both organically and now also through inorganic growth, has served 160 clients, 65 clients, sorry, covering approximately 400 hectares of high value crops. RSA has increased its scale and reach, while Aquantia Brazil shows promising growth prospects due to ongoing processes with high likelihood of closing. Regarding EBITDA margin, it improved both in the quarter and on a cumulative basis. Moving on to our cash position, as of the end of September, our cash and cash equivalents were 660 million pesos. Our net debt to EBITDA ratio stood at 2.1 times, slightly exceeding our internal limit of two times. We view this as a temporary level and we expect it to fall below two times in the near term. The company remains financially solid and will continue to be strategic in managing both sides of the equation. controlling debt while also focusing on improving profitability. Our total debt amounts to 4.4 billion pesos distributed between short-term and long-term to maintain financial flexibility. Short-term debt stands at 315 million pesos, mainly allocated for working capital to efficiently manage day-to-day operations. Long-term debt is 4 billion pesos, which includes the fixed-rate sustainable bond. The overall blended cost of debt is 8.8%. In addition, we optimize our cash conversion cycles by four days. And our interest coverage ratio remains above six times, demonstrating our capacity to meet interests and obligations. During the first nine months of the year, our capital investments represented 4.5% of the sales. marking a significant 39% increase compared to the same period last year. While with 92% allocated in Mexico, we focus on incorporating new technologies for more sustainable water tank production, as well as the construction of a new plant in Iztapaluca. Additionally, we invested 90 million pesos in Bevia and 29 million pesos in the development of the water treatment and recycling plants. Our return on invested capital was 10.3%, which is 40 basis points below our cost of capital. While we've increased our investments, our focus in the coming quarters is to enhance NOPED to regain a positive spread between ROIC and WAC. We remain committed to implementing strategies to enhance profitability and create lasting value for our shareholders. Finally, As we look ahead to the last quarter of the year, the prolonged economic recession in Argentina, recovering more slowly than expected, will continue to impact our performance. Therefore, for the full year, we're estimating revenue growth between flat and 5% decline, EBITDA margin between 14% and 15%, leverage between two and two times, and ROIC estimated to be 100 to 100 basis points below our cost of capital. We're navigating current challenges to position the company for future success and as Charlie mentioned our strategic majorities are to reverse the decline in the beta trends through expense reduction and focus on higher operating profit to increase free cash flow via strict capital expenditure control. Thank you very much for your time and interest. We can now begin the Q&A session.

So you can submit a question by pressing the Q&A button. And please include the name and your company. So let's start. Our first question comes from Carlos Alcaraz at Apalache Research. And it's related to CapEx. So the question is, what percentage of the revenues are you allocating to CapEx next year?

Thank you. We'll be taking Q&A minutes between Mario and myself, and I'll start by thanking you, Carlos, for joining in your question. Regarding CAPEX, we will be dealing with CAPEX. Sorry, I just turned on my mic. We will be dealing with CAPEX slightly different from what we have been doing in the past. In a sense, we will... maintain maintenance capex. This will be the most essential capex needed to continue to generate the results we have been generating and the results that the market will offer us the opportunity for. But all other capex will be approved on a month-by-month basis. So we will be increasing The threshold to which we will approve capex and so capex next year will be decided on a month-by-month basis for all discretionary spending not considered essential. In the essential capex, Mati, maybe you have a more precise number of maintenance.

Sure. Let me, thanks Charlie, let me compliment on the question. And Carlos, good morning. Thanks for joining us this session. Well, I think a good way to visualize the CapEx strategy for next year is on the product side, the strategy will be focusing only maintenance CapEx. We believe we have a very good platform with very modern equipment. All the smart transition towards the new water tanks and so on has already been deployed. So maintenance capex for the products edition, Charlie mentioned, is going to be maintenance capex. And that should come out around 1.5% to 2% as a percentage of revenues. For the services business, the strategy there is pay as you grow. Out of the three businesses, and this is an opportunity to explain that to you guys, is Bevia, each additional unit gives you growth. So the strategy there is, as Charlie was mentioning, is to meet to see that growth coming in and releasing capex or allocating capex to it. The same is happening with water treatment plants. Each additional unit, we will review it, and then we will put or allocate capex to it. As for RiaGo, RiaGo is a capex-less business. So as for the services side, again, it's a pay-as-you-grow strategy. And for your model, I think somewhere around 3% of total company revenues, I think that's a good proxy to model your financials going forward.

Perfect, thank you. And Carlos has another question. What is the percentage of progress of the Iztapayunca plant and what is the total estimated investment for this project?

So progress-wise, most of that project has been finished. We already started manufacturing in Iztapaluca. We yet have a transition to make from the previous plant to the new plant. And in terms of investments, I can't share that detail of investment specifically to Iztapaluca. But I would say that Matt, can we share what, out of the additional capex spent, what was spent in transitioning to the Smart, to the Tinaco Smart?

Well, that's a field we don't disclose because of strategy and competition issues, but

Let us get back to you, Carlos. Let us figure out a way where we can share more information. And maybe we can share more information out of the additional CapEx, maintenance CapEx, how much we invest in our products business.

Thank you. So moving on, we have another question from Bernardo Malpica at Santander Asset Management. And this one focuses on EBITDA and Mexico. So the question is, regarding the contraction of EBITDA margin in Mexico, of the higher investments in digital initiatives, how much of it is expected to be one time and how much of it will continue in the following quarters and for how long? Should there be a significant impact of digital initiatives investments in 2025 EBITDA margin?

Hello Bernardo, thanks for your question and for your participation today. So around digital and IT investments, we do expect those investments to go down next year, although spend will continue to be higher than previous years considering that we're taking traditional spending from traditional practices to new practices. So to call it one way, a department might be automated where you take a benefit of savings from one department and it's allocated to now paying licenses for new solutions. That'll be OPEX, though. So to implement a digital solution, you first have CAPEX, and then it translates somewhat into OPEX. CAPEX-wise, though, going forward, the investments in the Department of IT and Digital will go down for the remainder of the year and for next year.

Thank you. Okay, so now we have Sofia Martin at GVM. Actually, she has three questions. I'm gonna read the first one. What should we expect for the coming quarters and years from Argentina?

I'd love to have a crystal ball here. Thank you for your question and for participating, Sofia. You know, it has been highly uncertain in Argentina on what will happen. I do expect that going forward Argentina will regain economic growth. It has been very challenging and I do think that some fundamental corrections have been happening in Argentina, and that there is more and more certainty that the country will have a successful transition, but there is yet some key political events to happen to make sure that this transformation will finish happening. The way we are making decisions around Argentina is in a much more agile way, where we are making decisions on a month-by-month basis, as I've been mentioning how we've been changing our style. Argentina for us is a market where we invested heavily in working capital to protect the investments we've made over the last 20 years. We have a very strong position in Argentina to serve our customers. Our market shares in general have been sustained, but I do expect that working capital will be improved So in terms of cash flow, Argentina will perform better. But in terms of volume, I think we are expecting some level of rebound, but we will make the decisions as we get closer to each of the following quarters. We did see a rebound in the last quarter, and we do expect that level to be sustained for this coming quarter. Anything else, Mario, that you'd like to comment?

Well, probably I think Argentina, it's all dependent on the macro level that Charlie just explained. I would just compliment saying that the company is in very good shape. We are marked leaders in all three segments. Install capacity is to sell two times what the company is selling right now. So as long as the macro recovers and purchasing power from consumers comes back, the company is well positioned to drive that tailwind. The question is when, and that is where Charlie mentioned we'd love to have a crystal ball. That's going to be a 2025 play, or if that's going to take longer as Argentina transition to a different business model as a country.

Thank you for the response. Sophia's second question. When should we expect a rate given from the services division?

I'll take that one moment.

Sure, and Sofia, good morning, and thanks for joining us in today's call. Well, I think services, we need to break it down in three pieces. One is Riego. Riego is making a profit this year. Then water treatment and recycling. As you know, we have one in Mexico and one in Brazil. Both of them are going to be making money in 2025. Then Bevia is a tricky question because since the business unit is growing very fast, if we were to stop growth, then it can become profitable tomorrow. But right now, the strategy behind Bevia is to grow as fast as possible until the market stops growing. And that, from our financial projections, makes Bavia to start making a small profit with a high speed of growth around 2026. So I think right now what you need to see is that the growth and the market is there, and you need to achieve as much as many as possible subscribers until the market stops growing. And that is what creates a negative area given the customer acquisition costs for every single new user.

Thank you. Now for the coming question, I'm going to put together two questions, one from Sofia Martin and another one from Martin Lara. They are both asking about the debt levels. So in that regard, what kind of strategy we have going forward?

Well, as Andrés mentioned at the beginning of the call, it is a transitionary issue that we're looking to get solved in the coming six months. The company has some internal levers and cash-on items that we are working to realize. during the next two quarters, and that should bring the debt level below the two times ceiling that we all have conveyed in the past.

Maybe just complementing, as I mentioned, we do expect EBITDA to grow as a consequence of being more efficient in expenses. So that'll change the net debt ratio to EBITDA. And then we do expect to reduce investments. So taking the rate of investments down will require less cash, also reducing the need for... And so between improving EBITDA and reducing investments, that complements also Matthew's answer in how we see this only transitionary for the short term.

And then just on that, and probably the question is, which are the levers? Basically, there's one at the balance sheet, which is inventories. We are high in inventories, mainly in Argentina, because we thought the country was going to come back faster. So we are taking very well-thought steps to bring down inventories in Argentina. The same happened in Mexico. As mentioned early on, first semester was a heavy drought. Third quarter rains were unusually high, and it was the highest rains in the last 40 years. But the company planned for not such a heavy rainy season. So also we have an inventory issue in Mexico. So inventories are going to be reduced for the remainder of the year, both in Argentina and in Mexico. That should release some cash at the balance sheet. And we have some assets that are non-productive assets that we are looking to sell. So those are the levers at the balance sheet on top of what Charlie explained around an EBITDA pickup and as a result of the SG&A and revenue on the first case down and then on the second one.

Perfect. So moving on, we have another question from Martin Lara, and this one focuses on BEVIA. And the question is, how do you see this service segment evolving over the next few quarters? Are there any plans for additional futures and expansions within this platform?

So we have been making a big investment in evolving the digital platform, which is being launched as a test already and will be launched, hopefully launched very soon. Going after that, it will be incremental improvements to that platform. We see Vavia continuing to grow aggressively. It is a business that will prioritize going forward as it shows strong financial fundamentals and it casts a an impact that is recognized by customers. So that market is growing very aggressively for us. So it is a business to be prioritized, and we expect to continue the higher growths, and we will be leveraging already high investments that we've made in the past, but going forward, it will be more incremental as compared to the past. Thank you.

Okay, so next question is from Felipe Baradán at BTG. He has three questions. I want to start with the first one. Why did the services segment slow down so much even after the programmatic M&A provided close to 60% to 70% of year-over-year growth the last two quarters?

Are you clear on that programmatic comment? Please go ahead.

Well, Felipe, good morning, and thanks for joining today. There's one main reason, and it's the variable business, because of the heavy droughts, got impacted during the quarter with less projects. Now that the rain has already come in, it's starting to pick up. So the Riego and the storage business, we are seeing to complement each other. In the drought part, water storage will benefit from it. On the rainy season, the Riego business unit will benefit from it. And that is maybe the reason why the sequential growth on the services segment slowed down.

Thank you. The next question. Welcome, Andrés, to the Rotoplast team. I'd like to hear your thoughts on the company, what strategies you hope to bring to the table, and what can we expect under your leadership?

Thank you, Felipe. Nice to meet you over the conference call. I hope to meet you in person soon. Well, the strategy is clear, right? I don't intend to make big changes to the strategy. I think the company has successfully had sustainable, profitable growth for the last few decades already. So continue that, right? Continue to work towards more and better water. In terms of specifics to the short term, I think being very disciplined in managing the balance sheets, both on the liability side and on the working capital side. Also, being very strict with costs and expenses. I think we need to control what is in our hands. as opposed to the macroeconomic challenges that we're having. I think we can focus on what we can control inside, which is mostly expenses, working capital and capital expenditures. So I would say it's mostly that, Felipe. And I guess the company has a lot of potential. The growth in Beria is significant. The growth in the rest of the services segments is significant. So we need to capitalize on those investments that we have already made and continue profitable, sustainable growth for the future.

Thank you. Thank you, Andrés. So we have actually received a similar question earlier, but to elaborate further, here's a question from Rodrigo Salazar. and touches on EBITDA margins and growth in Mexico, other countries and Argentina. So I'm going to read all the questions, but starting, we already touched on Mexico and Argentina, but he's asking also, can you please clarify the low margins in the other countries? And something about Argentina. Why did Argentina's margin decrease even with quarter over quarter sales growth?

Sure.

Thanks Rodrigo. Thanks for your comment regarding your goodbye for me. Thanks for that. Well, Argentina, what we need to do was to lower prices to increase volume. So that's the reason why you see a pickup in revenue and a slowdown in inevitable margin. And that was a strategy to start moving around inventories and starting to pick up the growth in the country. Also in Argentina, what is happening now is as the country starts to shift to a different business model, which is going to be more appreciated competitiveness as opposed to just a closed economy and growing prices with inflation. Now the whole country is having issues around how to price things. And you see that not only in our industry, but in several industries, distributors doesn't know how to price things because inflation is going down very fast. And that's part of what we're starting to understand how to manage that. We're putting together some price management strategy that we are very good in Mexico. That's something we want to translate into Argentina. And I think that will benefit going forward into what we believe is going to be a new era in Argentina. But obviously right now is, you know, we're trying to move around the business with what we have given the macro circumstances.

Okay, so there's a follow-up question by Rodrigo Salazar also, and it's, if you could please explain a bit more the change in the strategy, where will the main focus will be?

So, hello Rodrigo, thanks for joining. The strategy on the process started changes. What will change is how we will manage expenses and investments. considering the current situation of margins. So we will continue to focus on driving growth in the core of the business and mainly in Mexico where we have been very profitable we will continue to promote that growth. As you may remember, we brought to market and we continue to bring to market new products in a very accelerated way since we started the flow program. So these new products continue to see interesting growth rates there since we started to bring to the market, to really start launching the new products until 2022, mainly that's when it was more aggressive in terms of launches. These products are only beginning to become relevant to the point that their growth rate impacts or make cuts for any changes like the one we had in Mexico products in the core of the business. But that is part of the core of the business, that there will be contributing to the core of the business, and that will be one main priority. Secondly, we are still very positive, as we mentioned, on the opportunity, the potential on services. Most, I would say, yeah, most of the hypotheses on our thesis around services has continued to prove successful and to prove correct. Sometimes we do have unforeseen demand variability but these businesses continue to demonstrate that they provide a product or a service, sorry, an offer, which is a service, you know, that benefits customers, where the customers are wanting this as opposed to the traditional solutions. And so, with their desire for our solutions and the opportunity in terms of scale, which is much larger than our products business, we continue to see high potential and we will continue to prioritize services. And thirdly, in the U.S., we will continue to focus in the U.S. as it is a very interesting market and it offers very interesting diversification to the rest of our markets, which is Latin America. And so I would say these are the three main focuses on our strategy going forward. Now, the way we will invest in those businesses is what changes on just being a little bit beyond.

And if may I complement Charlie's, when you see the business on the long run, and I think this is important, Rodrigo, is if you see the last 10 years, a little bit more than 60, around 65% of total CapEx has done in the last five. So having said that, the company's coming out from a period of, or a cycle of a lot of CapEx deployment and allocation to make the platform more robust and with greater capacity to grow. So the business strategy on where to focus, it's the same. That is not changing. We are very happy on the industry where the company plays, the countries where we are, and the product and services portfolio that we have. So I guess what we're trying to convey is that now the company will focus into really making those assets work better for bringing a sustainable growth in the coming years. And on the services side, you know, it's more pay as you grow, as mentioned, and it's more about technology investments that flows really as expense in our P&L. That has, most of it has already done as well. So I think the company is very well positioned to take advantage of these a high capex, high digital cycle that we're coming out and that should position well us for the coming year's growth and profitability.

So thank you, Charlie. Thank you, Mario. And thank you, Andrés. That was the last question. Would you like to say something, final comments? Goodbye.

Thank you again, Mario, for his wonderful contributions, his friendship, his unconditional support on all of the history now and going forward. Thank you.

Thank you very much, Ari. It's been a pleasure really working here in Rotoplaz. I've enjoyed every single day of those 30 years. And I'm very happy about where the company is, the industry, how the company has been built and the future of the company, that it's going to be great. Thank you again. Thank you again, all of you guys, for listening to my voice and watching my face for the last 10 years. See you soon. Have a great day. Bye-bye.

Thank you, everyone, for your questions. That concludes our Q&A and the webcast. So you may now disconnect and have a great day. Bye now.