Imcd Group Nv U/Adr

Welcome to IMCDNV First 9 Months 2024 Results Conference Call. My name is Alan and I'll be your coordinator for today's event. Please note this call is being recorded and for the duration, your lines will be on listen only. However, you will have the opportunity to ask questions at the end. This can be done by pressing star 1 on your telephone keypad. If you require assistance at any time, please press star 0 and you'll be connected to an operator. I'll now hand you over to your host Valerie Dele Brown, to begin today's conference. Thank you.

Good morning, everyone, and welcome to the IMCD Q3 2024 call. As usual, I'm here with my colleague Hans Koimans, the CFO of IMCD, who will lead you through the financial results after my preliminary remarks. And then we are open to answer your questions. In the first three quarters, we recorded revenues of €3.6 billion and operating EBITDA of €403 million. On a constant currency basis, this is a 3% EBITDA increase versus previous year's same period. This increase can be mainly attributed due to an improved performance in Q2 and Q3 after a disappointing Q1. During the third quarter of this year, we were able to deliver a gross profit of €303 million, which is a FX adjusted growth of 13%, resulting in a 13% EBITDA growth on a constant currency basis versus the same quarter last year. This result was a combination of the performance of first-time inclusions of acquisitions as well as organic growth. Additionally, we strengthened our position in all operating segments as well as regions through 12 acquisitions year-to-date. Despite continuing difficult market conditions, we are happy that we saw organic growth, cross-margin and editor growth in all three regions in the third quarter. Still modest organic growth in EMEA, but more notable in Americas and Asia. In terms of general market development, we continue to see volatile months across all regions and business lines with little visibility beyond six weeks due to the desire for low inventories and just-in-time orders by a substantial part of our customers. We see many volumes and orders being moved to the next month, and the ongoing geopolitical changes make predictions very difficult, which is why we focus on those elements which we can drive, commercial excellence, digital upgrading, and principal as well as customer collaboration and support. In terms of effective business development, we were able to win new principals and to expand with existing ones. Our principals continue to be excited about the volumes we have been able to gain and we will closely work with them to develop additional opportunities. As far as our M&A pipeline is concerned, we maintain a healthy, attractive target list and delivered year-to-date, as mentioned, 12 acquisitions across all three regions of business segments. And last but not least, we continued with our digital investments and sustainability programs, which we will further roll out in 2025, as mentioned during the lab tour in Milan in September and a respective presentation which was published on our website. We are confident that our investments made, our strong commercial teams, digital and logistics infrastructure, combined with a continuous drive for operational excellence and cost control, will deliver further growth and efficiencies. Simultaneously, We feel it to be prudent to be cautious with predictions in such a volatile environment with a changing geopolitical landscape. Hans will now give you a short update on the numbers.

Thank you. Thank you, Valerie. Good morning, ladies and gentlemen, and I will briefly summarize IMCD's first nine-month results that we published earlier today before we go to the Q&A at the end of this presentation. I would like to start on this page, page 9 of the presentation. And as you can see, Forex adjusted revenue and growth profit both increased with respectively 7% and 8% compared to last year. And the 8% growth profit growth in the first nine months of this year is a combination of slightly positive organic growth and a 7% increase as a result of the first time inclusion by businesses. During this year we saw a positive development of organic gross profit growth. As you have seen from a minus 8% in Q1 via a plus 4% in Q2 to a plus 7% organic gross profit growth in this third quarter. Gross profit in percentage of revenue slightly increased to 25.4% and this increase is the result of changes in local market conditions combined with the usual fluctuations in our product and various local cross-margin improvement initiatives. And these effects more than compensated the negative impact from acquisitions on the gross profit percentage, as these acquired businesses on average had a lower gross profit margin than group average. Forex-adjusted operating EBITDA increased 3% to $403 million. And this 3% increase was a combination of a plus 8% as a result of acquisitions and a minus 5% organic. When looking at the trend here over the quarters, we saw a similar trend as mentioned for gross profit. Negative organic in Q1, a small plus in Q2, and 5% organic EBITDA growth in Q3. The conversion margin was 44.3%, which is 2.5% below last year. Then Forex suggested net results, earnings per share both slightly decreased. The cash earnings per share, so after adding back amortization net of tax, is more or less similar as last year. On free cash flow, we reported 65 million decrease compared to last year. Cash conversion margin of 73% was lower than the same period of last year. Increased working capital investments were the main driver of this increase. And this working capital investment was primarily driven by an increase of business activity. Further, we report a little increase in working capital from 66 last year to 68 days this year. And on the last line of this page, you will notice a 7% increase in our number of full-time employees. And it's fair to say that this increase is the result of new employees as a result of acquisitions done. And when normalizing for these acquisitions, we would have reported a little decrease as we were very cost-conscious and careful in filling open positions given the uncertain market conditions. Then on the next slide, slide 10, you will find a summary of a few key figures split into the various regional operating sectors. In the first column in EMEA, we reported solid numbers given difficult market conditions in the various markets and challenging comparable figures of last year. Year-to-date gross profit growth was positive, and we were able to further increase the gross profit percentage to 27.8%. In EMEA, Forex adjusted operating EBITDA of $186 million was 1% better than last year. Modest organic gross profit growth combined with inflation-driven own-cost growth was the main driver of slightly lower like-for-like EBITDA and reported ratios for EBITDA and conversion margins. Organic EBITDA growth was positive in both the second and the third quarter. Then in the second column, the Americas, positive development of organic growth, profit, and EBITDA growth, both with double-digit organic growth number in the third quarter, could not compensate the relatively weak performance in the previous two quarters. However, we've seen a promising and ongoing quarter-after-quarter improvement since the weak first quarter of this year. And the gross margin percentage in the region increased from 24.1 last year to 24.7% this year. Asia-Pacific, the third column, is the only segment where we saw a decrease in gross profit percentage. This 1% decrease from 23.3 last year to 22.3 this year. And the reason of this decrease is mainly the result of acquisitions done. These acquisitions contributed 20% to the top line and only 14% to gross profit. Therefore, it's obvious that these acquisitions had on average a lower gross profit percentage than our legacy businesses. When normalizing for this acquisition impact, the average gross margin percentage slightly increased compared to last year. And similar to the Americas, we saw healthy organic gross profit and organic EBITDA growth in the third quarter. And then in the last column, you will find the cost of holding companies. And this includes all moon operating companies, including the head office in Rotterdam and the regional support offices in Singapore and Miami. The cost increase reflects the growth of IMCD and the corresponding need to further strengthen the support functions both in Rotterdam and in the regional head office. On page 11, a summary of the free cash flow. Free cash flow was, as I mentioned earlier, 65 million lower than last year, resulting in a 17% lower cash conversion ratio. The reported decrease is mainly a result of higher working capital investments as a result of higher level of business activities. Strong sales in September and additional stock to cater for the open orders in October were the main driver for the working capital increase. And CAPEX was low in line with the, as you know, asset line business model of IMCD. Then on page 12, a short update on net debt and leverage. Compared to the end of December last year, net debt increased with about $300 million. This increase was a combination of positive operating cash flows on the one hand, combined with, amongst others, a $128 million dividend payment and $277 million of considerations paid for acquired businesses. When looking at the debt position, the debt includes at the moment two 300 million bonds with a coupon of a low 2%, and further it includes two 500 million bonds. As you might have seen, we successfully issued a new 500 million bond in August. And this new bond matures at the end of April 2030 and has a fixed coupon of 3.725%. Then you can see the reported leverage ratio, including the full year impact of acquisitions was 2.8 times EBITDA. And leverage based defined on the definitions in our loan documentation was 2.7 times EBITDA, and that is well below the maximum level that we can have there, the 4.25. Then last but not least, on page 14, you will find our outlook for 24. They could read that we are positive but cautious as market conditions make future demand and developments difficult to predict. And that was my short summary of our year-to-date financials. And Valerie and myself are happy to answer questions that you may have. And I would like to hand over to the operator, Ellen.

Thank you. If you'd like to ask a question or make a contribution on today's call, please press star 1 on your telephone keypad. To withdraw your question, please press star two. You'll be advised when to ask your question. We will take our first question from Chetan Udeshi, JP Morgan, your line is open, please go ahead.

Yeah, hi, thanks for taking my questions. Maybe the first one is for Hans. You know, typically in the chemical sector, I guess it's also relevant for IMCD, You know, you always see Q4, which is weaker than Q3. You know, it's just a general seasonality. From today's perspective, Hans, do you see any reason to have a better Q4 than normal seasonality or worse? Or would you say the normal seasonality is what you expect for Q4? And just remind me of what do you think is the normal seasonality for IMCD over the years? Is it you know, down 5, down 10, any color there. And maybe for Valerie, within your life sciences business, I'm keen to understand how big is your exposure to the, you know, to the beauty market because we've seen, you know, warnings after warnings from large, you know, personal care companies about slowdown in the beauty spending. And I just – sort of remembered that, you know, you've been talking about personal care as one of the businesses which have been growing quite well for IMCD in the recent quarter. So just trying to understand how big the business might be for you. Thank you.

Chetan, thanks for the question. You're absolutely right about the fact that Q4 is always a bit of a lighter quarter, but also a quarter that is pretty difficult to predict. And when I say pretty difficult to predict, that has to do with the fact that we never know what customers do with respect to factory closings at year-end, how quick they will basically stop the production season, and if they want to replenish stock already before year-end or just after year-end. And that makes us cautious. What we see in today's environment, there is reluctance of customers to have stable stock positions, as I would call them. Everybody's cautious. Everybody wants just-in-time deliveries and just what they need to produce. I think it's fair to say that if you look historically, there's always a weaker December month. The good news there is that it drives your working capital position slightly down, so you generate typically a higher cash generation in the last quarter. The negative is that your top line is lower. But I have no vision on where it should land this year at the moment. I think we were positive about October, and let's see how November and December will develop.

And in terms of your question on the beauty market, We would love to have an even bigger exposure to the beauty market, even if there is maybe momentarily a decline in terms of us. We have not seen a decline in the third quarter. All our business lines, except pharma, grew in the third quarter. Pharma has a bigger impact, and that is already in the numbers for a couple of months, as I had mentioned in the other calls.

Can you just remind... You know, within life sciences, can you maybe, I know you don't give exact split, but if you were to rank by the relative size, the different parts of life sciences, can you do that for us? How big, like pharma, beauty, other bits, just on a relative basis, even if you don't want to give the percentages, which is the biggest, which is the smallest?

Yeah, so the guidance that we gave in the past on the life science side, food and pharma are the biggest. biggest, like on the industrial side, coating construction and advanced materials are the two biggest. Beauty and personal care is absolutely the number three and growing nicely. Thank you.

We will take our next question from Suhashini Varunasi, Goldman Sachs. Your line is open. Please go ahead.

Hi, thank you for taking my question. I hear your point on Q4 still being uncertain, but it usually is the smallest quarter for you on an annual basis. And given you've returned to profit growth on a nine-month basis this year, just curious why you didn't talk about targeting operating EBITDA growth in the outlook. So just some color there, please, would be helpful. And how is your order book looking, I suppose, at this point in time? Because I think your peer mentioned it's looking decent for October and November. The second one is on SG&A. It has been outpacing organic GP growth or general GP growth. I appreciate a part of it is coming from M&A. But what are your plans on maybe controlling the SG&A and targeting market margin expansion going into 2025? Just the last one is on working capital. Is it possible to break out how the investments were generally? Was it more on the receivables front or was it a decent chunk from inventory as well? Thank you.

Three questions. Shall I start taking? I'll start with the last one. On the working capital, adapters and stock were the main drivers there. That was what I mentioned. September was a strong month and then you finish the month with a high adapter position. And we also saw a strong order book for October and as a consequence at the end of September we had to make sure that we had the stock in the warehouse. So these were the two main drivers. Then your SG&A question, I think if you look at our cost structure and cost base that we reported here. It's fair to say that we operate on, if you look at the number of people that we have on the payroll, that we operate on a slightly lower number of people, and that the cost increase that you see is mainly inflation related to the existing teams that we have. What I see there is that, yes, in the first quarter we had difficulties to make that cost inflation good not report margin growth. As we see an improvement quarter after quarter, we are getting back on track there. I think we do a pretty okay job. Then with respect to the guidance for the last quarter, yes, this short month, yes, we have visibility on an order book that delivered a pretty okay October and looked healthy for November. But at the same time, what we also see every quarter is that orders quickly move into the next month or move into the next quarter as basically customers always have the freedom to postpone a delivery or to break an order in two. And that means that we are, although we have that visibility, it's always difficult to predict in which month or which quarter it will finally land. And that is the reason that we are a bit cautious about making a prediction for the rest of the year. And then the December period in the current environment, we see here and there customers already announcing that they closed their production factories a bit earlier to basically I think save a bit of their cost structure. And for us that is difficult to predict, difficult to judge. And let's see how the month plays out and the quarter plays out. And we will tell you what is at end of February, early March next year.

Sounds good. Thank you very much.

We will take our next question from Amanda Mathias, Kepler Journal. Your line is open. Please go ahead.

Yeah. Hi. Good morning. Thank you for taking my questions. I actually wanted to come back on the SG&E and the OPEX group. You've been trending this year up organically, I think, roughly some 5% to 7%. Is this the kind of run rate in terms of OPEX growth we need to bank on for next year? What would be the core drivers of that? I would be minding that.

If you look at our cost structure, if you go through the P&L, high cost of goods of course follow the revenue and they have seen our development in gross margin percentage, so that means that we were pretty consistent in keeping the margin at the level where it was last year. Then we have third party cost as a big cost driver. There we see the usual discussions about changing rates and additional transportation costs at year-end. And of course we try to push back to our third-party service providers if they come up with cost increases. These are the negotiations that go on at the moment. And then the biggest cost component that we can influence is our basically people-related costs. And as people are the main asset of our company, And we need to be careful that we keep paying people in line with market conditions.

I don't think... No, and I think what I would like to add here, and we have made that point also in other calls, we clearly see ourselves as a growth company. And in considering that our most important assets are the people, we are... not in a mode to say, okay, we're going to decrease the number or we are going to not give the required salary increases. And additionally, we have a lot of investment in digital, which we feel are very important to be competitive in the future. And also on this side, we'll continue to have people working on all the various programs that we have talked about. So we feel it is prudent actually to continue with these investments and to then save on those elements where one can put some negotiation on or one should be a little bit frugal. But on the people's side, we will continue to invest in order to be fit for the future.

Okay, thank you. Let me do a small follow-up. I think last year there was a little bit of a tailwind on the back of bonus provision rules that have been reversed. Is this something we should expect to reverse in Q4 this year? I assume that it won't be of the same magnitude.

I hope not, to be honest, because if I need to reverse, it means that people don't make their targets what they expect to make right now. So there's a bit of a plus and a minus here. If we don't make the targets, there will be a bit of a release. And if not, I think everybody happy.

All right. Thank you. All my questions.

We will take our next question from Queryn Mulder, ING. Your line is open. Please go ahead.

Yeah, good morning, everyone. A couple of questions. Let me say, zooming in on EMEA, I see, let me say, that organic growth nine months of minus 3%. That was already the case in the second half, first half, I must say. So it looks to me that the organic growth on EBIT A level was, again, negative against the second quarter being positive. So maybe you can elaborate on what's happened in Europe, and maybe you can zoom in on, let me say, what is the development there with regard to coatings, construction, and maybe on the automotive sector where you have also a position with VDOX. That's my first extended question.

Let me do the number part. We saw organic EBITDA growth both in Q2 and in Q3, but by your conclusion that in Q2 the organic growth level in EMEA was higher than Q3 is a right one, but they were both positive. And I think that is a bit in the wrong.

And in terms of automotive sector, I mean, I think the beauty of the business model of IMCD is that it has so many business groups. It has so many different sub-businesses within each segment that it's extremely resilient. Yes, we have an impact of the automotive sector, and that is at the moment clearly not looking too good. but overall that compensates with other trends even in the same business groups and in others that are doing very well. So I think automotive, we have nothing that is so outstandingly important that really overshadows here.

Does that answer your question? Yeah, mostly. There was a strong momentum in the second quarter with regard to coatings and chemicals for construction. So that is still the case, as I understand?

Yes.

Okay. And then my question, my second question on the Americas, it looks to me that the margins on M&A are higher than in the, let me say, on the companies on Americas itself. Is that correct? And can you maybe elaborate on that somewhat? Yes.

I'm looking at the numbers now, Quireen, and my feeling is that also in the Americas, but I'm trying to do this now out of the top of my head, but in the Americas, the margin is, I think, more or less slightly higher than the average in that region, slightly, but not a lot. And I see the opposite in APEC. And that is, of course, the area where it has the biggest impact because there we have most of the acquisition growth. And there the margin on the acquired businesses is, for various reasons, on average much lower than what we typically see.

Okay. Okay. Thank you.

We will take our next question from Nicole Menion, UBS. Your line is open. Please go ahead.

Hi, good morning. Thank you for taking my question. Just given event this week, just wanted to ask how much of your US product is imported compared to being produced domestically? And if some of it is imported, how much of that comes from China? Nicole, come on.

We don't know by heart. But I think it's fair to say that... I think if I look at the suppliers that we represent in that market, if we import, we mainly import from EMEA, and I think very limited out of Asia, and as far as I know, not a lot from China.

Yeah, absolutely. For obvious reasons, in terms of our supplier base, and yeah.

Yeah, just wanted to double check. That's very clear. Thank you.

Thank you.

Once again, if you'd like to ask a question, please press star 1 on your telephone keypad now. We will take our next question from Dominic Edrich, Dutch Bank. Your line is open. Please go ahead.

Hi there. Thanks for taking the question. Just one on, just to follow up on Nicole's question, just a more general question about supply chains. Obviously, we've got a strike going on in the Canadian ports that's potentially going to be the East Coast ports. U.S. is still uncertain, and as I say, you know, the tariff situation is unclear. Are you feeling anything from either your principals or from your customers about the need to build up more inventories at the moment, or what are your thoughts on the current situation on the supply chain? Thank you very much.

I have not received any requests for building up of inventory due to that, and also we don't see at the moment any impact in terms of our performances.

Thank you very much. We will take our next question from Eric Wilmer. Okay, your line is open. Please go ahead.

Hi, good morning. Thanks for taking my question. I got one left. I believe Q3 was the first quarter in quite a while that the number of FTE went down slightly Q1Q. I think that you also highlighted that you were continuing to invest in stuff in Rotterdam and in your global corporate offices. So I was wondering if it's slight FTE decline, although it's indeed slight, but is this perhaps driven by any businesses bozo in Q3? What am I missing? Thank you.

Erik, it is mainly the result of the fact that we were careful filling vacancies. So if people leave the company, then we really discuss is there a need to backfill or can we fill it in a different way? And I think also the contribution of new employees as a result of acquisitions in that period was relatively low. And you can imagine that you will see a pickup in the last quarter because the Bloomberg acquisition will add, what is it, about 160 new people. And for sure, a couple of the vacancies that we had during Q3 will be filled in the last quarter. But we are really cautious. There should be a business rationale behind adding new people and if we backfill open vacancies. Also, due to the more digital environment that we are creating, we also see a slight change in roles. So we need to be careful that we don't automatically backfill if people leave. And that is why you see every now and then a bit of a change in the number of employees.

Understood. Thanks, Hans.

We will take our next question from Matthias Kepler-Cheroux. Your line is open. Please go ahead.

Hello. Thanks for taking this. No question. I just had a question on the organic growth profit margin evolution in Q3, please. I have the impression it's flat to slightly down. Would you be able to confirm, and how should we think about the organic growth profit margin expansion going forward, given the fact we see better organic growth, which I assume is driven by better volumes? So any color on that, that would be much appreciated.

Sorry, first to make sure that I understand. If you talk about the gross margin... Organic, yeah.

Organic gross profit margin expansion. So effectively how your gross margin has evolved excluding the acquisition.

So in Q3, we increased our gross margin with 7%. So we had 7% organic gross margin growth. And the percentage gross margin that we realized in the third quarter was slightly higher than the same period of last year. In that quarter we were, if you do the math, I think 25.2 versus 25 last year. On both numbers we increased in the third quarter compared to the same quarter of last year. And that is also a bit the trend that I tried to describe in the in the opening remarks, we had that negative organic growth, profit growth in the first quarter, that it increased to 4% organic growth in the second quarter, and we report now 4% in the second quarter and 7% in the third quarter. Now we see a trend line that we are improving quarter over quarter here. And that is both on margin, percentage, and both on the absolute amount.

Thank you, Hans.

We will take our next question from Thibault Lenu, KBC Securities. Your line is open. Please go ahead.

Good morning. I just had a quick follow-up on the cost base. We've talked quite a lot on the FTEs, but if I look at the other costs, it basically looks at in the consensus numbers, the costs for the second half will go down quite a lot. I'm not sure what would drive the meaningful decrease in the other operating expenses in the second half. Some clarity on that would help.

Sorry, the line was at a certain moment bad. Did you refer to the comparison with what happened last year or in actual numbers or in consensus? Because I missed a bit. Yes.

No, my fault. I'm not sure. So when I look at the consensus numbers, it basically looks that the total other operating expenses show a decrease in the second half of 2024. I want you to basically see that overheads. basically remains stable, so that would imply that Q4 costs would meaningfully decrease in Q4.

Overhead costs.

Yeah. And you refer about people predicting the consensus, and that is, of course, difficult. Yes, exactly. Okay.

No, yeah, but it's just what I see in the consensus, so that's why I wanted to see if I missed anything, if there is reason for lower costs in Q4.

I think the only thing I could imagine is that what we saw last year is that during the year we saw that we would miss budget targets and that resulted last year in the situation that on the one hand we were again cautious of filling vacancies but also reduced the bonus provisions that we had. So last year there was quarter over quarter a bit of a decrease there on basically in my own cost structure because of that. Not something that would really move. I have to add to that as well. And perhaps that is part of the consensus. But now I'm a bit guessing what you and your colleagues put in your model.

Thank you. That's all for me.

We will take our next question from Corinne Mulder, ING. Your line is open. Please go ahead.

Yeah, from Corinne, two or four web questions. One is on the working capital and what you said about the, let me say, the behavior of your customers. If the working capital is growing so fast, in fact, compared to, let me say, more than 60 million higher than last year, does it indicate that the clients are starting to behave somewhat different from what it was at the trough in the way that they are now looking for orders for a somewhat longer time, or let me say, or maybe some higher quantities. That's my first question. And the second question is, and maybe it's a technical question, normally there is a big difference between your net debt over EBITDA ratios, between what you report and what the documentation is. Is that related to earn out or is there a difference there? Because it is normal, let me say, 0.6 and now it's 0.1.

Perhaps first to reflect on the working capital days. There are two things there. You can look at the absolute amounts and you can relate it to business activities and perhaps I should start on the second one. So we reported this time 68 days for working capital. compared to 66 last year and 67 the year before, at the end of September. And so it is all around that same ballpark. And the line that has the biggest impact on my working capital days is basically my debtor position. Because if I look at, if you look back historically, then my debtor days are always higher than my stock days and my creditor days. So if I have strong sales or strong top line growth in a certain period that drives my depth of days up and that has the impact on basically the number that I just mentioned. So I don't see anything abnormal. I only saw a bit of a positive sign at the end of September because I had and higher debtors and more stocks because of a strong order book of October. So for me this is more a positive than a negative, the fact that I had to regress. Then on the net debt, the difference in definitions, you're absolutely right. There is a different accounting treatment in IFRS versus loan documentation, how to deal with earn-out obligations and minority shares that are still with previous owners. And what we see in the loan documentation is that I don't need to include the earn-out obligation that I have to pay, but I also cannot include the profit related to the minority share. So, for instance, in the Cygnet case, I did not have the debt related to Cygnet in my loan documentation debt, and I did not have the 30% profit that related to that same debt position. First of all, the big one is out, so that already made the difference smaller. And the other thing is that as the open positions are getting smaller, the gap is also getting narrower. And that drives now the small difference between the loan documentation and the IFRS calculation. A bit of a technical answer.

What a technical question, so.

Yeah.

We will take our next question from Luke Van Beek, DGroove Petercam. Your line is open. Please go ahead.

Yes, I have one remaining question on your acquisition spending run rate. Are you still comfortable with keeping that run rate despite the higher leverage that you're currently seeing?

Yeah. I think, as you know, we have always maintained an active and disciplined M&A strategy as a complement to our strong organic growth. And what you see there is that acquisitions are always difficult to plan. First of all, you need to talk about a healthy M&A pipeline at the moment. We talk about a leverage profile, but I know that during the year, my highest point in the cycle are always the end of June and the end of September. So we will deleverage towards year end if we don't do additional M&A. But we will carefully monitor our balance sheet and our leverage development there, and I don't feel uncomfortable there.

Thank you.

As a final reminder, if you'd like to ask a question, please press star 1 on your telephone keypad now. We'll pause for just a quick moment to allow everyone an opportunity to signal for questions. There are no further questions on the line, so I'll now hand you back to your host for closing remarks.

It was a pleasure to be with you on the call, and as Hans mentioned, speak to you in the next year.

Yeah.

Thank you.

Wish you all a good finish of the year. Yes.

Thank you for joining today's call. You may now disconnect.