Autoliv Inc (ALV) 2005 Q1 法說會逐字稿

Good day ladies and gentlemen and welcome to the First Quarter 2005 Autoliv earnings conference call. (OPERATOR INSTRUCTIONS).

I would now like to introduce your host for today’s call, Mr. Lars Westerberg.

Please go ahead sir.

Thank you very much.

Good morning to all of you in the United States and good afternoon to the Europeans.

I am Lars Westberg.

I am sitting, as usual, with our CFO, Magus Lindquist, and Mats Odman and we intend to go through a short presentation package, which is available on our corporate website under the tab Financial Info.

The actual (indiscernible) some 20 minutes or so and afterwards we are going to do our best to answer all the questions you may have.

So if we start on Page 2, then the Safe Harbor Statement.

We are not going to go through it.

We just want to emphasize that it is part of today’s presentation.

Starting out with slide number 3 the Net Sales and that is more or less summing up the years past because we get the same data as in quarter 1.

You can say that the long-term sales trend has continued.

It is being driven from the (indiscernible) point of view by a good customer mix, from a product point of view it is being driven by side airbag systems, in particular, and also we have had a very nice growth in the Asian market, both Japan, as well as the emerging markets.

Finally, of course, as you all know, currencies.

To take a long-term view, which is the ten years that we have been public company, which you can see here the sales have increased fourfold from $1.5 billion to about $6 billion because of the above circumstances.

We believe today, as we have believed a long time to be honest, that the sales growth will slow down.

It simply has to slow down and (indiscernible) we believe will approach the market growth, given our size in the market today.

If you turn the page, please, you come to the last quarter to be discussed here, namely the quarter 1 of 2005.

We are presently running the trend the last four quarters of 15% increase.

That is stronger than we forecast at the last quarterly review, mainly because of customer mix and also because of market share gains that have been higher than we anticipated.

If we compare with the underlying light vehicle production in each particular region and compare our own organic sales growth, we have outgrown the European market with some 6%, mainly sales up 3% versus the light vehicle production minus 3%.

In the same fashion, North America is +5%, Japan is +12% because organic sales 17%, light vehicle production +5%.

Unfortunately, in the rest of the world we do not know what kind of production rate we had on the light vehicle.

The statistics are very delayed.

What we can say is that our organic growth was up 19%.

If you turn the page and have a look at the various pie charts and sales by customers, we can see easily here that the largest customer we have is the Ford Group.

You might see the small pie on the split-up on the Ford sales.

We can see that 6% is Ford in North America, where there is presently some turmoil, as I am sure you are aware.

The Premiere auto group, which is in our case primarily Volvo, represents about 9% and also a little bit, of course, the Jaguar and Land Rover.

Ford of Europe is 5%, Mazda 2% and Ford rest of the world 1%.

Consequently, 6% of that pie belongs to North America.

The Northeastern group counts for 15%.

Number 3 on our top 10 so to speak would be General Motors and if you split it up in the same way we had about 6% of the sales in North America, about 4% in European Union and another 2% in the rest of the world.

So if you to that add the 3% that Chrysler represents, we all in all had 15% of our sales in North America for the time being, 6% plus 6% plus 3% for Chrysler.

In the same way, you can look at the Korean and Japanese customer mix and it is continuing to go up.

We presently have more than 21% of our sales to Japanese and Korean customers.

You cannot easily see it because Honda, as well as Mitsubishi, as well as Hyundai and Kia are part of the big slice labeled others, but then it is actually 21% of our sales.

If we turn the page to the next slide and have a look at the organic growth, we had an organic growth of 5% when we have taken out not only the currencies but also the acquisitions plus the five extra working days.

Since we believe that the core production was down roughly 2% we (indiscernible) the light vehicle production was 7%.

The two points that stand out are the market share gains in (indiscernible) as well as the growth in size systems.

If you try to have a look on it from the regional point of view, as I mentioned, we have a fairly strong organic increase all across the region in basically all products.

Japan (indiscernible) 12% in Japan and 19% in Asia Pacific.

Turning the page to the Light Vehicle Production, in North America, as you can see, we have -4.4% for quarter 1 but we have two very (indiscernible) trends here.

The Big Three, where we consequently have 15% of our sales, is down 8.6%.

Where, on the other hand, the transplant is up 7%.

Very different trends that have the consequence that in our (indiscernible) in the United States today, half of them are transplants actually and the other half go to the Big 3.

The Japanese core production is up 5%.

The European is down 3%.

As I think we said last time, (indiscernible) Europe (indiscernible) also Eastern Europe.

The problem with Eastern European cars is that they have, from our point of view, a lower content of car than the Western European sort of core customers.

They even include the East European Union (indiscernible) Eastern Europe, which is actually growing but the pace was down 3.2%.

All in all, -1.8% which has been rounded off to -2%.

On the next line we can look at the unit development.

Seat belts produced and sold and shipped about $24 million during quarter 1 and both are (indiscernible) to be companies which we consolidate, so if we deduct the newly consolidated companies, which is mainly Taiwan (indiscernible) and Beijing, China, the change would have been 20%.

So (indiscernible) some other plants in China and Malaysia and other sectors so we can safely say we will run more than $100 million pace for the time being and more likely $60 million pace on pretensioners, both of them, of course, really nice figures (indiscernible) and mature market and light vehicle production down 2% and you increase some 20% is not bad.

Frontal airbags, growth is up 2%.

Light vehicle production -2% and chest and the side systems are up considerably but on the global market it is hard to say how we do on the market share point of view.

In the United States, just to take one example, in value terms, the United States is up no less than 68% compared to last year.

In volume terms, we talk about 70% increase so the installation rates have increased shortly because of course of the new Legislation (inaudible) that is coming up.

Then I think you can also say the (inaudible) even though it is not a big money maker, after (inaudible) it is up 26%.

Turning the page and looking into the gross margin development, we booked 20.0% gross margin for quarter one.

As you are aware, that does include actually some raw material costs.

It also includes the provision for the shutdown of an English plant actually.

So if we did not include that, the English plant closure, we would have booked 20.4% gross margin which is a little bit ahead of last year which (inaudible) all the administrative cost increases.

By the way, the material cost increase which is about $27 million and that represents 1.5 to 10 percent so it is not a small number.

This improvement is actually driven by salary, of course, and I think what we’re looking at here is the no labor cost country which is sort of helping out quite nicely here.

But it’s also no doubt driven by the sort of over-covered fixed costs like depreciation and so on.

So we are pretty pleased with the development of the gross margin.

Turning the page into the operating margin, again, excluding the plant closure we’re looking at 8.3% EBIT margin which is somewhat better than the previous revenue at 8.1 and if you (need) more or less in line with the guidelines you will end up with some 8%.

Including the plant closure we are down to 7.6%.

With the book for the plant close at 11 million after the total anticipated costs of 15 and the other 4 will come during the remainder of the year.

And (inaudible) is that we will achieve net the UK entities with some 520 in head count and we will have about 300 low labor cost entities, mainly in Turkey and that is where we’ll save up the whole amount if we need any to invest in 1 year.

We see this as a cost sound investment like any other investment, unless you have to book it in one quarter and then write it off.

On the next page, we can have a look at the income statement.

Here we have the sales increase, in the change column what happened year on year.

We have a sales increase of 14% which translated into gross profit of 14%, since we have the same gross margin.

We have reported an operating income increase of 7%, 229.

Had we not had the plan closure problem we would have had $140 million and that would have been an increase of some 17% which is then again, of course, slightly higher than the sales increase.

For the income before tax, we have a 7% increase to 123 reported and the underlying would have been 134 or also here a 17% increase.

The SG&A is up as it should be from 4.8 to 5.1.

We have salaries are up, we have projects you can say, services, we have (inaudible), we have one up.

Also we have some fairly high Sarbanes-Oxley costs unfortunately in quarter 1, which I’m afraid will stay that way for over the long haul.

RD&E is down a little bit in percentage charts and particularly so if you think about the reclassification that has happened. (Inaudible) from quarter to quarter.

However, the long term (plan) is still up, possibly as a consequence of the lower and lower engineering income we get from our customers.

For example, we think that this is a positive thing for everyone but we don’t think it’s been received.

The underlying is 6.5, but the reclassification of (inaudible)

Tax rate -- we have a tax rate in this 1st quarter of 33.7.

We believe that when the (48) is over that might be roughly 1% lower and that will develop somewhere towards the end of the year.

Mostly surcharge on fuel is kind of over from our point of view and that has driven up the tax rate as well.

Formally we did have some losses in countries where we had losses previously but basically all companies make money these days, we had eaten up all of the losses (inaudible).

On the next slide we have the capital turnover rate.

As you can see the last 12 months looks like it has (inaudible) but we just added (inaudible) You can say that in quarter 1 we have more than 2 times in capital turnover rate.

Turn the page again, please.

We come to the return on equity and basically return on equity went up 0.4% from 12.7 to 13.1, if we disregard the plant closure.

We believe that that compares favorably with the weighted average cost of capital which (inaudible) is around 8%.

To take the long term trend, all recent plant closures and the whole lot, we are presently running at 13% return on equity.

In a similar fashion on the next page we have the return on capital employees which is up 2.2% and we are now at 17.6%, which compares favorably with all the other quarter 1s’ as you can see here. (inaudible) graph in the same form and fashion if we took the long term trend in the last 12 months we arrive at 16.6%, all inclusive.

And again, if we took out all the intangible assets in the balance sheet and they (inaudible) more (inaudible) return on the tangible assets, we are running roughly 35% in quarter 1.

Key figures, earnings per share at $0.84 and that is an up of $0.04, again, without complication of the plant closure we would have been at $0.93 and that is of course an up of 16%. (inaudible) working capital is up compared to the turn on the year from 7.8 to 8.5 but as you can see it’s well below quarter 1 last year, which was 10%.

It was something (inaudible) we had 10% on target and we seem to meet that target so better than the target at 8.5%.

Debt is about 100 million lower than a year ago, but that in the same fashion is 52 million higher than turn of the year, though 52 million is more or less exactly what we’ve paid out in dividends and buyback of shares to explain that net increase in the turn of the year.

Headcount, we are down actually around 50% rounded off (inaudible) of 100 (inaudible).

It’s actually sold at the headcount in the high labor costs countries been down 513 during quarter 1.

We are up 1,270 in the low labor costs countries and this has been fairly promising because as you know so far we have taken the increases in the low labor costs countries but, basically kept the high labor cross countries but now we’re starting to go down in high labor cross countries and there’s more to come if you understand we have the English closure and some other announcements to make.

We have like a structure plan as we are preparing for the time being.

On the next line you can see the cash flow and we have another quarter with positive cash flow.

Gross cash flow (inaudible), net cash flow.

Over 12 million net -- what we cannot see here unfortunately is that in quarter 1 we had $37 million higher tax payment than we had the previous year and if we got that (inaudible) to the same payment we had a year ago.

And I’m also saying that in quarter 4 of last year the preceding quarter, the net cash flow was its highest 136 and as you know it’s not unusual that you get some kind of back cash.

So 12 million and an unusually high tax payment last year we actually did have a tax income because of some German tax that was paid in last year, quarter 1.

Turning the page again we come to the year’s long term cash flow and then again we have the long term, the last 12 months’ figure, we of course only changed out quarter 1, so you can see that we did not do bad at all.

Of course we are way ahead of the long term trend.

We talked about cash flow operations $0.5 billion.

Cash (inaudible) takes about a $0.25 billion.

Also you can note here that the depreciation is more or less in line with the CapEx and the CapEx is lower than the (head guidance) at the last quarter.

Having said that, we feel that the CapEx is likely to increase through the remainder of the year so we still keep the guidance of some 350, give or take 10 million.

Next line will be the shareholders, we turn to the shareholders and next time we pay dividend which will be in June, we are up another 20%.

We normally pay 30% per share, 4 times the share.

Plus we have also both (inaudible) in quarter 1 here at 700 thousand shares at the cost of about $45 million.

And the next line more or less says the same thing and all 7 million shares that you see average price, so far, that they bought 12 million shares; it’s about $29.

And also, we have another 7.7 million shares at the present interest authorization to buy back, the authorization from the board.

Next slide we see the line we discussed last quarter (indiscernible) the raw material price increase and how that’s going to help us and we are fairly accurate in our prediction here.

We though we would look at some 30 million and actually came in at 27 million. (Indiscernible) we have forecast.

We believe that it’s Quarter 2, 3, and 4, it’s probably likely to stay at this level.

We believe that this income size of the steel price but really if it goes up and down in the remainder of the year does not mean so much, we want to have more or less loose (indiscernible) level on the fee bases product that we buy, and so far we do not see too much from the old base product so we think that these (indiscernible) is a good thing basically as last quarter and those estimates going forward.

Next line you see (indiscernible) that in spite of all these raw material cost increases, we still believe we can lower the direct material cost that go into our production unit with about a percent or so.

And we haven't seen (indiscernible) target to move out, not only the direct labor and the overhead, but also to (indiscernible) more in the lower cost countries and at the turn of last year we had about 16% of our (indiscernible) lower cost countries.

At the time of Quarter1 here, we were at 17% and the target is to keep increasing so that at the end of this year we would have some 20% of our purchases in lower cost countries and 17 today looks like we should be on the way to achieve the target of 20%.

What I’m thinking (indiscernible) and coming to the course of action more likely the production over the next slider here, we can see that the, the inventory finally started to go down a little bit in North America and we are now looking at 69 days inventory and that in June it’s turned it down about 200,000 units compared with last year and all of these 200,000 units are really (indiscernible).

They’re up from 2.9 to 2.7 million units, just on top of my head, so some decrease in the (indiscernible) and also we gained some supply and very close now for the 10 year trend.

Turning the page again and having a look at what the forecast from CNS says. (Indiscernible) buyout.

As you can see we have the (indiscernible) two different trends and (indiscernible) trends up, (indiscernible) down.

Quarter 2 is forecast to have another good increase of 1.7% but then followed by 2 quarters there we have some 2.7-2.8% higher production rates which we would look forward to see actually.

If that is true, the sum of Quarters 2, 3 and 4 would actually be higher than it was the previous year and as you can see, the full year half gone, the total estimated (indiscernible) of 16.8 to 15.7 million units if you see the trend from 2001 to 2005, it's really no big (indiscernible) fairly stable (indiscernible) action but within the production numbers, a lot of things happen between the various suppliers.

Next line describes the same thing in Europe we have a 3.2 % downturn here in Quarter 1 and even more so in Western Europe in Quarter 2 we have total of .8% up.

That includes the East Europe up about 2%.

And the (indiscernible) year is actually forecast to go down 2.3% which for us is pretty bad because as you know those are the best equipped (indiscernible) are the ones that are from our point of view at least, best to go (indiscernible) and most (indiscernible) and also the ones in Western Europe.

So, 2.3% down even though, even for that (indiscernible) and Eastern Europe is up about 7% (indiscernible).

So all in all we have from the Western European and Easter European market a negative market mix with (indiscernible) a down peak in the West compensated by an up kick in the East but with lower content by (indiscernible).

Finally, next slide is Japan and quite a good quarter we can say.

Supposedly followed by another good quarter, quarter 2 was flat, quarter 3 and then a good quarter 4.

As you can see here we have actually 300,000 cars and more is the forecast for production in the Japan compared to the previous year and that would be the highest (indiscernible) in all of these years that we have followed, so strong development in Japan unfortunately our market share in Japan is some 20% (indiscernible) the lowest market share in Japan.

(Indiscernible) outlook for quarter 2, we believe that the base could come up some 10%, just roughly 3 of them we believe or you could say the underlying market rate will again close at some 7% because of currency that have a little bit been a relatively slow organic state increase has to do a little bit, we have very high market shares, we have for a long time.

But sooner or later we have to come down to be the market growth to start with.

Secondly, the development in Europe is slow, not as good as the European market has indicated because the Eastern European (indiscernible) production and so when they go where Western Europe goes very much further actually.

More again, the (indiscernible) space has seen a similar level at 8.3 as we had in quarter 1.

In quarter 1 we managed to compensate the whole price increases of raw materials, which is more or less 1 1/2% actually.

In quarter 2 this year we also had higher volumes and (indiscernible) should offset it once more.

And we talked about of course we have some other, probably going to see some higher research and development in quarter 2 compared to quarter 1 and on top of that quarter 2 last year had a relatively low rates and amortization cost compared to what we have now.

It was unusually low for quarter 2.

So we (indiscernible) worse in the comparative fashion.

That (indiscernible) would be the end of the presentation.

(OPERATOR INSTRUCTIONS) The first question is from Himanshu Patel with JP Morgan.

Please go ahead.

Hi.

Good morning guys, or good afternoon.

On the side curtain airbags could you tell us where you think the US penetration rate is currently?

I think the last number you had thrown out was about 20%.

I wish I could.

But I cannot.

But it clearly is going up.

There is no doubt about it and that we are almost in the mood where we are (indiscernible) utilized so we have to buy (indiscernible) from all (indiscernible) sources.

I couldn't tell and I think the last figure I saw was 18%, but we have not had a chance to update all of those after Quarter 1.

Okay.

And then any color on what's happening in the pricing on side curtain airbags?

Has there been any accelerated pressure yet?

I think the answer is it's more or less the same as usual.

I can say that we have seen an unusual pressure in place of the (indiscernible).

It's more or less the same thing across the board.

And then in Western Europe, you mentioned weaker production—were there any particular periods during the Quarter where that started occurring or is that pretty consistent throughout Q1?

It was very consistent throughout Q1.

There has been a couple of stop leaks (ph) and (indiscernible) to have seen one of our biggest customers.

But I wouldn't say that there's one (indiscernible) of course that (indiscernible) for instance BMW and Mercedes, some kind of diesel (indiscernible) but nothing remarkable.

These things happen all the time.

So I won't say that it's been anything at one particular time.

More or less throughout the Quarter.

Okay.

And then I am just wondering when you look at your margin guide and you see about a 100 basis points sequential improvement Q1 to Q2 in terms of EBIT margin and that you're calling for flat.

So, is that—are you expecting the production environment in Western Europe to be that much worse in the second quarter?

We think that the production line in Western Europe will be worse in the second quarter but also we know during quarter 1 we did compensate with the raw material increase and that is 1 1/2% of sales and we did it with (indiscernible) rates, we did it with some currency gains and we did it

Today and we did it (indiscernible) the overhead to no cost but we are not sure how that’s really going to pan-out long-term and also we think that in Quarter 2 we had a very possible save in administration cost last year that will not repeat this year of a firm traditional that range (inaudible) and that may or not recur.

And of top of that if you look at it all the lean figures of Quarter l looks like (inaudible) 6.5 but really we have recapped at fine some production mainly in the United States to our (indiscernible) to actually the figure is down to 6.2 and that is below the level that we have had, you know we have 29 or more D&E and I’m sorry to stay in training up.

The (indiscernible) income you know, but keeps decreasing globally.

Okay and then, Lars maybe one last question on the whole issue with oil based products.

You’ve been talking for a while about how you guys are fairly high up the value chain and as a result, these oil price increases aren’t hitting you immediately but we’ve been in this for several quarters now.

At what stage would you start getting worried about this, I mean is this something we should think becomes a major concern in the second half of the year?

Well we had seen some increases on the materials for our webbing for the (seat bench) but you know, in dollar transit not usually.

We have something raw increases when we weave the (indiscernible) but it doesn’t translate to a whole lot of dollars and as we look at Q1, we have 27, we still will maintain the guidance of 30 and we think we (indiscernible) 30 so as we (indiscernible) we are not to worried.

Okay and maybe one last question for Magnus on the taxes, any hope to bring that back down in 2006, the tax rate?

Well we can always have hope but the underlying tax rate I think is still very high and then you know we have certain tax provisions that could affect positively or negatively given a lot of difference when it comes to tax from different countries well so fairly done that the tax rate (indiscernible).

The next question is from Scott Merlis from Thomas Weisel Partners, please go ahead.

Fantastic, excellent Quarter.

Looking at the Quarter, the MG Rover write down looks like about .3 cents a share tax affected.

I didn’t hear whether some of that might be recurring or not?

Well really we booked it at $3.7 million and are ahead of 9 others above the EBIT line.

That’s it, that’s all it is and we really, you know, we were not surprised about this.

I think nobody initially way.

What we had done before is that we had taken the receivables down to 16-days already 2-years ago with a lot on arguments I would say.

Not only that, we had appreciated all the price bound (indiscernible) and sales and (indiscernible) and so on and that’s why it was limited at $3.7 million

Right, so that would have been .96 cents but is some of that, could some of that hit in two periods earning left from MG?

Well it should not.

I should be all done then.

So it would have been .96 cents.

Looking ahead, you’re outperformance administry, shouldn’t that still be 7% give or take a point, maybe 6% maybe a little higher than 7%, going in the next few quarters, no performance of the triad?

We may think so and one may hope so, we believe however that we are approaching down, we are going down the markets rate we believe if it’s exactly like we say we don’t know, but were bound to be down to the market rate.

Looking at Q2, you have the triad, what’s your triad forecast again that down 1% was it, what?

Q2 we have like .7 down.

.7 down, if your outperformance declines to 5% to be conservative, that puts you at 5.7 and then the currency plus 7% on the currency gives you sales growth at 12.7%?

It probably does, yes.

So the message on Q2 is that 10% sales guidance is an approximate number.

I’m sure it is an approximate number all of these figures are.

This morning I’d like to say something that is when I say .7 down here you know, we think that given the new statistics, anything could happen to our (indiscernible) European trade as indicated I’m afraid.

Right so that’s maybe why you use 5% or 6% of performance instead of 7.

Does that make sense?

Well, we are guiding the way our guidance wants to say.

Well that makes sense.

(Indiscernible) We’re going to talk financial in July.

Well that makes sense.

Looking at the chart in slide 8, Higher Market Shares, slide 8 I believe, is that slide 8, Higher Market Shares, seatbelts up 23?

That’s correct.

What is, what is electronics doing these days, is that significant?

No electronics is less than 10% of sales and relatively flat I would say.

Last year, we did more than half of them and I don’t have them on top of my head, in Quarter 1 but, overall, pretty flat but.

But the question I have is if you look at Q2, Q3, Q4, this unit growth should be roughly similar?

No it’s gone down too, I mean usually can not (indiscernible).

Any time it goes down more than 2% we (up 20.)

Now and then relative to the market.

We think we are coming down to market rate again.

Okay and let’s see.

On the raw materials side, the, what is the cost recovery for raw material?

Are some of your plant closings and cost reductions, do they kick in subsequent quarters, to what extent to other due to plant closings from last year help you more in future quarters, to what extent may customer reimbursement help you more in future quarters?

The plant closures from last year I don’t think we have a whole lot to expect in Q2 and after this year buying lost in cost (indiscernible) and then we have the benefit, and that should be at least $50 million US per year so that we have.

What was the second part of the question please?

To where are you in customer reimbursements of raw material costs?

In reimbursements, we had a little bit from customers, a couple of them but basically they are up 91.

One component (indiscernible) tied down I would think I would try to measure it because we slapped with a 5% proposal for price between (indiscernible) account and we went 2% up from 2.3% up for the price increase and then we end up in some kind of debate and went up (indiscernible) but how much we went up before the price increase is hard to say.

We don’t sort of pay that once finally next time than (inaudible) on a negotiation base I should say.

The final question is your strength inside Japan is surprising, your content, could you just review where you are and penetrating Japan in Worldwide US, Europe and inside Japan because that seemed to be an important part of your sales growth that also made the important part of your gross margin expansion.

In other words, are you also gaining content on the European transplants as well as US?

We do the major sales is really about the US and then in Japan we think we’re having trouble like 20% of the airbags and we (inaudible) because as you know 45% market of Japan is (inaudible) they have their own account, (indiscernible) on the other 65% and we have then the trophy market we have like 19 (indiscernible) or I would say, 20 on airbags now.

And seatbelts are probably like 19 and we’re close to 25 on (indiscernible).

And we also have (indiscernible) in Japan on top of the whole thing.

If you turn to the United States as I mentioned half of the airbags produced go to transplants the other half to deployed cars.

If it takes (indiscernible) status unfortunately not the case, the share of the seatbelts (inaudible) and we have a very minimal share, if any, which (inaudible) the United States.

We do have several of the other transplants.

So, seatbelts is another story.

Here we have the typical 70/30 share of seatbelts.

Europe the transplant has been not so high but we have a similar development of course. (indiscernible).

The next question is from Richard Haydon with Omega Advisors please go ahead.

Could you kind of refresh your comments from the first quarter relative to share repurchase and dividend in terms of compensation of shareholders in ’05 at least equally the amount paid in ’04.

Is that still on target?

Well we don’t have a total per say.

We take it after every quarter trying to fill out what else it looks like and we are (indiscernible) other quarters is usually.

We are going to have a look at it by Monday morning and then we will decide if the stock repurchasing or not.

The dividends maybe not (indiscernible) that is the board.

I understand that, but I think there was a comment made in the first quarter that the thought was that this year would at least parallel last year in terms of dollars spent on those directivities.

We have not specified.

I think we made the comment that the (indiscernible) may be that what you see at the end of the year but we can not promise anything because if the price is very, very high then it is most cost efficient of the shareholders that we raise the dividends.

I am worried most with intent than promises.

(indiscernible)

I am more interested in the intent as opposed to a promise.

The intention it to say (indiscernible) to the shareholders in the best possible way.

We intend to send our (indiscernible) stock buying back shares next week again.

This is a short-term question.

The (Sarbox) costs, incremental costs that you mentioned.

You expect it will stay at that level going forward.

No not really because some of the costs in the first quarter was actually some overhead costs from last year because we had to finalize (inaudible)from 2004.

You can say that last year’s costs were $9-$10 million and long-term costs we expect to be half of that maybe $5-$6 million but not more than $6 million.

And just to galvanize Scout’s observations about Rover plant closings.

Should we kind of think about that the underlying earnings of the company in the quarter were $0.96.

That was a correct deduction on his part wasn’t it?

It was a correct deduction.

That bad news is that there is always something happening every quarter.

This time it was Rover and there is nothing more to say for Rover.

That’s done with.

I would like to take the opportunity when we have nothing negative and only positives.

Okay, thank you very much.

One other thing if I could.

There is little mention, if any, about future product developments and commercialization of those efforts.

That is an ongoing program and I couldn’t say anything that America has happening in quarter 1.

You know (indiscernible) they tend to take time and they are dragging and materializing and we took the (indiscernible) and announce it at the start of production because our customers, they want you to be their invention.

They never say that you came up with anything, it is their product.

Any comments on night vision?

(indiscernible) is estimated to (indiscernible) this year.

So of course the production is estimated to (indiscernible) this year.

And any sort of investment of run rate in terms of annualized volume for that product.

The annualized volume, or customer year talks about 30-40 thousand units per year but (indiscernible) option either of them (indiscernible) but it is a high volume.

I would say by far the highest volume of any night vision system ever.

I tend to believe that it is probably half of the world market on infrared cameras.

Any sort of estimate as what you might realize per unit?

No really we haven’t talked about it and we don’t know how our (indiscernible) would price it either.

Of course we are going to make it profitable (indiscernible).

And all the R & D costs by the way haven taken this cost already.

So lower cost activated, nothing to write down, it is only an upside.

The next question is from [Thomas Beckman] of Merrill Lynch please go ahead.

I have a couple of questions if I may.

Just coming back to your data some stories there has been an earlier question (indiscernible) some clarification on why (indiscernible) from decline margin in year and year one (indiscernible) based on modern progression and (indiscernible) in Q1. (indiscernible) what is going to happen at gross margin level.

The decline from (indiscernible).

(inaudible) We expect as you said a slightly higher SG &A.

Also, another factor is when we have price reductions on our products to our customers they don’t count from day one.

They negotiate every day every month, which means that we have (indiscernible) price reductions but we have then had (inaudible) fact of the (inaudible) price from the first (inaudible).

So from that perspective you can see that we never even (inaudible) pressure on the work volume for the next coming quarters.

Could you give us an update on work topics for ’05 and ’06 given the ongoing restructuring that you mentioned so far stopping to review the number of (inaudible).

Within the figure we have mentioned here in the 360, give or take some 10 million, the biggest lump sum I would say are invested in China and accumulated in China the plant called for some 50 million.

Some of it is taken, some of it remains to be taken and the second we’ll invest taking high so they remain (inaudible) so that you launch (indiscernible).

I am not aware of anything more that is a little magnitude.

(inaudible) ongoing and of course (inaudible) remain in China.

Okay, two more quick questions if I may.

In terms of your (inaudible) could you just explain why to go (inaudible) going forward.

We have minority shareholder in our (indiscernible) and continue to make more and more profits that makes minority interest also do well.

We have the minority interest in a number of terms in Malaysia and China, Taiwan, but the big one that you basically see on the P & L is the Korean one where we had 65 (inaudible) and our talk with the (inaudible) corporation at 35 and on this (inaudible) rapidly.

Which is good.

Next question- would you mind commenting on additional acquisitions given that you have every ability that you may look around for small acquisitions (inaudible).

I mean basically you are right.

In some small acquisitions (inaudible) would be of course because some of the price (inaudible) would drop.

We do not, as we said here, we have nothing big in the pipeline so that is why we (inaudible) compensate shareholders as (inaudible) but small acquisitions we can do without any problem and so (inaudible) incur a cash generation.

Everyone (inaudible) it is more like (inaudible) on technology otherwise we wouldn’t do it probably and (inaudible) but we have nothing to (inaudible) for the time being.

Things may change though of course and that is one of the advantages if we had a little tougher market in some parts of the world usually something comes up for sale.

The next question is from [Elon Sederwicz] with [Kasimov].

Good afternoon gentleman.

Just a point of clarification quickly.

Again going back to your production figures on slide number 8.

It says seat belts rose 23% year-on-year in Q1 and I am just trying to square this up a little because you had organic growth in seat belts up 4%.

Did that then mean that you had pricing pressure of negative 19% in Q1?

That is a pretty good question.

What is going [inaudible] I understand what you are saying.

[Unintelligible].

But lets talk, we have 23% in unit one but three of these depend on if we have not only consolidate [inaudible] and the Taiwan plant and then we owe it 20.

Then we had five full work days, which translate three more working days, which translated to 5%.

Then [inaudible] and how much [inaudible] was like six, was it?

Four.

Then it would be at 11.

[inaudible] Asia there are no [inaudible].

[inaudible] got to be a way, we have said many times before that he problem with [inaudible] India for instance [inaudible] or there could be big [inaudible] or even three [inaudible] of [inaudible] so they vary price so much.

Seat belts are not worn in Russia. [inaudible] Western Europe and [inaudible].

Okay.

[inaudible] explanation I would say that the price if anything is always an [inaudible].

I just chose seat belts because it is the most transparent example.

You have a good point, I have to say I haven’t thought about it myself.

Thank you.

I am quite new to the stocks so maybe that helps.

But if you looked at the [inaudible] products you have also very similar double-digit growth rates in volumes.

Obviously some of that is technical but again with 5% organic growth you are facing strong pricing pressure against all of your products and I was wondering do you see, was there anything inQ1 that was particularly aggressive like that or it was just quite difficult market conditions all around.

In our [inaudible] habits [inaudible] speeds up that last year [inaudible] tickets for last year [inaudible] 60 million airbags.

Half of those are frontal airbags [inaudible] they [inaudible].

So what we are looking at is the big growth numbers both on the side systems they grow a lot of course but they only represent half of it.

So, unless it is strong dilution that you like from the [inaudible] if you take [inaudible] wasn’t all that much or half of these numbers roughly then so [inaudible] guess, 30 divided with two, 16%, something like that.

Coming back to your [inaudible] another [inaudible] products will include [inaudible] structures with [inaudible] which we have [inaudible] and actually it was down 49% organically [inaudible] so that is also the other information. [inaudible] the streaming trains for volume of cause and now a days we are basically only supply these of the [inaudible] and the rest we no longer produce.

And each of sounds [inaudible] we run out the back log and then we are no longer going to produce these metal structures because it is not our core business.

However, when we look in [inaudible] as [inaudible] said we book it under seat belts that also distorts the picture.

If anything price [inaudible] is less on seat belts.

Thank you I thought it was a simple question you are bringing other facts in that makes it more difficult for me to extrapolate the pricing pressure.

Could I just ask you, up front I suppose, on seat belts for example what do you see year-on-year in pricing pressure in that product segment.

We see 1.5% something it is only more like 2.5 on airbags as a real general statement.

The next question is from Anders Trappe, Enskilda Securities please go ahead.

Congratulations again for a very good quarter in a difficult market.

I have two questions one is you mentioned you have now about 15% of your sales to big three North America today.

I was just curious do you happen to know how much those represented in 2000.

22%. 22% according to Matt [ph] he has been here a long time you know.

I am impressed with that.

Somebody asked before you.

And second also you mentioned that you now actually [inaudible] down in the number of [inaudible] in the [inaudible] across the countries.

Previously you could manage to increase your sharing low let [inaudible] a growing depth but now you are [inaudible] I think in high [inaudible] countries.

Does that indicate that we might have to expect closer costs on restructuring costs or whatever you want to call it going forward, which we have not really seen much of at all.

That could be.

I mean depending on country as you know there will be seven countries and maybe even closing costs.

For the long-term, though there is no other way to do it.

We think the competition is not [inaudible] anything so we had to survive [inaudible].

So we are going to have continued with this restructure programs.

Some of them might be [inaudible] but that is nothing new we have seen that [inaudible] in more than nine others that is by enlargement severance costs so we have had a couple of meetings [inaudible] I would say.

I mean a lot of Frenchmen have been sort of laid off.

Now they are going to be some rates but they are taken it was 5.5 million last year.

But that of course spans 520 of them so it is not huge money really.

You are now what 37 or 40% of the half in the [inaudible] countries.

We believe it is 40% although the head count is 37.

And then we have particularly [inaudible] we had a number of temporaries and that is to be able to shrink the number of high [inaudible] cross-country, across [inaudible] having a lot of severance.

What would you say a possible number to end up with [inaudible] between high and low [inaudible] most of your customers do have there [inaudible] in higher labor cost countries.

That is right they do but it is kind of been a moving target and it is almost impossible when we look at the core production in [inaudible] but then all of the sudden we find that the [inaudible] in Europe and growing and 60 million [inaudible].

It seems to me like all the new car plants are being setup in Eastern Europe and in The States it might be a little different but then they are more, and more [inaudible] in The States I would guess.

But as you have been looking at buying [inaudible] and moving [inaudible] many of the Japanese companies we set our plants in China and also other low-cost terms too.

One of the markets that had the target of getting to 35% and making [inaudible] low labor costs and now we are 40 and we are [inaudible]not [indiscernible] raw material issue.

On the same [inaudible], you don’t really expect [MA] a sequential increase in the raw material cost, you are up like 27, 30 million before it's going to stay up that level.

My question is really, do you expect to see your own efforts counter these cost decreases, which apparently seem very successful in the 1st quarter?

Will that continue and accelerate the rest of the year, or have you sort of done what you can do?

I think [indiscernible] is going to stay where it is and I think that [inaudible] we’ve also done what we can do but as you know there’s also 2006, so we now need to start to work on that one too.

I think so far this year we are not forced anymore to [inaudible] prices and that we need to focus more or it won’t help [indiscernible].

But then we have to start to think about 2006.

Will it help in 2006, maybe?

Right, it has to do that and that here again, we need to buy it maybe in other parts of the world than where we buy it today.

The next question is from Christian Breitsprecher with Deutsche Bank .

Please go ahead.

Yes, good afternoon.

One question on working capital.

You had a significant increase on working capital requirements in the 1st quarter, is there mainly any structural reason that your working capital requirements could move up, back to the 10% threshold that you’re setting yourself just in terms of maybe, some of your clients trying to use you more as a financing?

What is the other trend, what should we pencil in into our models, an extra 10%, or something around 9%?

What would be your guidance there?

Our guidance is that we continue to try to be below 10% but we have nothing that will really changed the picture from last quarter.

Of course [indiscernible] keeps all the sales when our customers have some difficult times, but nothing dramatically has changed.

So we should play around with about 8.5%?

It could swing around quarterly.

In this quarter we had to take some tax payments and that had an impact on that long-term --

Contractually, nothing has changed, that’s --

The next question comes from [Abanish Aquila] with Goldman Sach’s London.

Please go ahead.

Good afternoon.

Abanish Aquila from Goldman Sach’s.

Just a question on the longer-term strategy.

In the next 2-3 years as the growth begins to slow on the inflatable curtain, airbags [indiscernible] , and knee airbags, what do you see as the best product opportunities to continue to grow above underlying vehicle markets?

Or, do you see a situation where as these products are maturing you’re going to have to get used to a level of growth that’s more in line with underlying vehicle trends?

We think that the [indiscernible] come in 2 or 3 years is going to be more of the some so to say, I mean some of us feel that we are more equipped and more financed and we're not for sure going to be [indiscernible].

They are for sure going to be [indiscernible] mature, but then again the big growth in the market these days is not only in the number vehicles.

But also for us in Asia Pacific and the emerging market.

There they’re not only -- I would say this happens to [her] that organic 19% we are past the ½ billion mark which will [indiscernible] but yet the cars are relatively poorly equipped.

In only a year or 2 I think that there are going to be more cars in Asia Pacific than even North American and [indiscernible].

Also domestic Japan, the cars are not particularly very well equipped, they might have front belts and seat belts that’s it.

Very little on the side.

Same goes for Korea.

So [indiscernible] with the existing programs but you’re right, some of the most well-equipped cars are maturing and that will depend more or less on the number of vehicles.

If we come to 2010 on the other side and that's going to be a much more electronic [indiscernible] and we believe in the so-called [indiscernible] safety, proven crash test and side test systems and so on, but I think your question more had to do with 2-3 years.

Right.

Just going back to the raw materials issue, I know it must be difficult to try and calculate the impact or the effects from reimbursements from customers, if I’m assuming something in the range of 10-20% reimbursement on that 27 million, would you say that’s an accurate assumption, roughly?

I’d say it’s very difficult to measure, I’m sure we’ll get some money back, but most of it we hope to recover in the form of lower [indiscernible] rates to our customers.

That’s basically what I believe will happen.

And then one can’t really calculate, what would we have achieved had we not had the problem with the [indiscernible] price, versus what we should have [inaudible] problem with the steel price.

Sometimes you say to them I understand [indiscernible] but of course they do.

They do warrant the same prices [indiscernible].

The next question is from Adam [Jonas] with Morgan Stanley.

Please go ahead.

Thanks.

Good evening, gentlemen.

Just a couple of questions.

First, back to the working capital, you eluded that if some of your customers are having some problems that could have an impact on your receivables, and it looks like looking at the break up of the accounts, that it is the receivables that jumped the most from 4th quarter to 1st quarter and year-on-year.

Are we starting to see GM, Ford, basically, as Christian alluded to, borrowing from you here?

Is that -- you said that your assumptions haven’t changed in terms of your 10%, but are you seeing -- is that growth in receivables because people are basically not paying you as fast?

And then my second portion of that is, what portion of the working capital increase is just raw materials, just the inflation of raw materials also inflating the working capital for your global operation?

Answering your first question -- I think it’s sort of the same.

Nothing has changed when it comes to our relationship with the customers.

So, you could even [keep in mind that] last year after March we had 81 days of receivables outstanding.

This March we have 75.

So actually better than a year ago.

So, no change in trend.

And when it comes to raw materials the inventory levels are about the same.

So nothing has really had a significant impact there too.

A second question is just on your cash flow outlook.

You’ve given pretty specific guidance on the CapEx, given us reasonable metrics to judge your growth and your margins for the rest of the year, when put all together, are you confident that your free cash flow after your CapEx projection, can grow in line with your profits?

Or is that working capital step change going to mess that up a bit?

We stick to our guidance here where we have said for a couple of years now. [indiscernible] we have about ½ billion and in gross cash flow and sorry -- net cash flow is about 2 ¼ billion, that’s where we are basically.

You expect to do ¼ billion of free cash flow in 2005?

Yes.

At least.

That’s where we expect to be, basically.

Okay, I’ll leave it there.

Thanks very much.

The next question is from [Glenn Robliane] with BNP Paribus.

Please go ahead.

Yes.

Hi, good afternoon.

I have a few questions.

Just the first question -- why do you see a specific slow down in Q2?

And is this something more you see for the year ahead, or specifically for Q2 starting from April now?

Yes.

Just to repeat what we said before, basically, that longer term we cannot continue to grow at the pace that is not sustainable, 7% more than the [indiscernible] rate of production.

So, that combined with the fact that we have serous [indiscernible] customers that in order so that they appear when you have a 1st plan started, has made us come to the conclusion that probably our approach in rare or organic growth is approaching the underlying market.

Long-term that’s probably where we’re going to be because I believe we’re worth more than 35% of the world market today.

And some parts of the world market its closer, [inaudible] chunk but the bigger chunk we’re not going to have and of course, there are chances we’re never going to get to simply.

So of the available market we have a big piece.

Okay, so it's not fully specificity to it, that’s no question on some regional platform specific, it might well be in H2 that we see there is a slow down.

It is not going to be Q2, but it’s not going to be (indiscernible) it was going to be jumping up and down for every (inaudible) some of these (inaudible).

It might even go up again in a couple of quarters.

We have stolen a lot of market shares in our 3-4 years and some point some of the other tried to come up too like we had so much (inaudible) today. (inaudible) 20% of new returns and the cause of action down too somebody is losing a lot of shares out there.

I don’t know who is but assuming it is quite an achievement just to maintain what we have.

Had a question in terms of pricing as well.

You showed in another presentation that some products have a better pricing and officially I think on the side and head airbags.

I am not sure to really understand compared to the previous comments on pricing.

Well that is not really the pricing that you see on that slide.

It is the average shipment price for our products and the curtains are specific for two reasons.

First or all more and more of the curtains go into the SUVs, which then are much bigger.

They go all the way from the A to the D tiller in many cases.

And second thing is that most of that market is in Europe and since that value is measured in dollars we try to recall it here is affected by the currency the strengthening of the Euro.

So that is two reasons why that distorts the price we are going to try to find in that (inaudible).

Okay I think (inaudible) before.

And in terms of (inaudible) I am not sure did you mention what you recover from customers in this quarter in Q1.

We did not mention.

We probably began (inaudible) right on time but the big gain is that we have it at the bargain and chip when you don’t see prices.

That is the way to get it back. (inaudible) market until pricing you probably think about Morgan, which most people, including ourselves do.

But try to self contain at Morgan because you know some (inaudible) are of (inaudible) that can be pretty high margins and some else can be high tides and no margins.

It depends on how complicated the (inaudible) is you know.

The last questions on margins is there doubts on (inaudible).

I think in Q2 for the extents of the margin decline and can you reason why there could be a margin decline in H2 and that these, some non-recurrent costs will be upset in H2 including also, lets (inaudible) business for raw materials.

Basically we take one cause at a time and we are going to give you our best estimate on what we see in Quarter 2 and we like to see that. (inaudible).

The next question is from Fredrick [Labia] with SG Cowen please go ahead.

Just one question, you say that you close with productivity come to market.

The question is maybe to what bidder and how many more years to you expect to continue to out perform.

We don’t know of course what speed it is going to be.

It depends on our computer (inaudible) situation compared to our competitors and what (inaudible) are going to be ready and which ones are going to be bad.

The last couple of years we have had a good mix of customers and a good mix of (inaudible).

What we see now is that we think they are going to slow down in quarter 2.

I think we should basically leave it at that for the time being.

That is not to say that that is going to last forever.

It goes up and down you know and we have had two, we have been extremely successful the last couple of years and it is part of being (inaudible).

We have not changed our (inaudible).

No, no not at all.

Absolutely.

(inaudible) 3% (inaudible).

No the target is much more than 3% of course.

But from (inaudible).

Yeah.

Well there is not a target on our performance.

We try to do as soon as we can every quarter you know but 3% that is beyond my market and we say the targets continue to out perform the market better than 3% in other words.

And you do much better as you see in quarter one.

I think we are seeing here seem to have — we think it is going to be tough in quarter 2.

Okay thanks, question on the big risk on GM maybe you know what (inaudible) if GM was to request for chapter (inaudible) addition.

What would be the impact for you.

Did you prepare for something like that or (inaudible) on such an event.

I don’t think we have any exports of GM (inaudible) speaking.

I think (inaudible) but I don’t think it is a risk in the (inaudible) short-term.

It is difficult to prepare you know because they are saying the words (inaudible) and (inaudible) producers.

So, you can sort of be in this role that the small and independent companies about very (inaudible) in our models.

If you talk about the exposure, I say physical (inaudible) although GM was America about $78 million I would say.

But then of course it depends on what the inventory situation is and what the production situation is and so, which one would have to make volume detail (inaudible) at the time now.

It would be in I think for the whole industry something unsurpassed (inaudible) in the world (inaudible).

I don’t think it is likely short-term or medium-term.

But you never know.

(inaudible) on detail I could see that a position of (inaudible)

Yes, we continue to (inaudible) in the coming years.

Okay thank you.

Perhaps we should clarify when we talked about market growth then there are two riders and (inaudible) tend to discussing the supply value of the vehicles, the number of airbags in each vehicle, how fast that grows, and that drives our market by roughly 3% per year.

Then in addition to this you have the car production and that has grown by 2% since ’97 in the trial and then it could be even more to the rest of the world.

So, just looking at these two components we are talking about price percents as [multi] growth.

The next question is from Robert Dahl with GLG please go ahead.

Good afternoon actually Robert Dahl if you don’t mind.

Just one quick question, on productivity in previous presentations you talked about managing the cost of materials through productivity initiatives both internally and also from your suppliers.

I think you have given a figure of 3% as being the level that you are seeking to offset headwinds of raw material cost pressures.

Could you just confirm that is roughly the shape of productivity that you are seeking and secondly are you actually on track for that or is that skewed towards the second half?

Yes your right we have all the (inaudible) 3% of the material and we’re not on the way to 3% we are only roughly at 1% for the time being and the reason we seem to be raw material cost increase so we are not on the road to 3%, unfortunately.

Then of course we have a long productivity at where we usually apply 5% and here we are on the way.

We are presently around 6.2% productivity and count on it.

And that is a (inaudible) answer to your question.

The raw material increase, as we discussed earlier, we are unfortunate (inaudible) whole 2005.

What is happening in 2006 and 2007 is up for negotiation in the fall.

Could I just confirm on the raw materials head winds I think you said $33 a quarter, which is a 129 million so then you a 22 million headwind last year.

So are we to think the incremental is 100 or are we to think the incremental this year is 120.

No the incremental is 180 million less because we are going to get some from our customers too.

The next question is from Adam [Tuckman] with Golden Tree Capital.

Go ahead.

I have a question surrounding the share repurchase program.

You said that starting Monday the blackout period ends, is that correct?

Yes.

And just given the balance sheet structure and the leverage below one time and I guess the threshold of being less than three times levered was the company or management starting to look at raising a dead deal to buy back stock and a larger amount just give away the stock prices?

When we continue with the way in the past years, buying back to the market and world trade to global size continue to increase (indiscernible) not what given in the balance sheet.

Okay but more specifically, in the First Quarter, you guys were buying stock in an average price of 50?

You bought about 700,000 shares of stock now below 44.

Did I hear before that starting Monday you didn’t plan on repurchasing stock again in the open market?

We can not comment until we start but (inaudible) we will see what happens and we will think about it and then we will make a decision and then the part on the corporate web page, then we will know immediately.

Right at what point do you think leverage needs to fall to before you raise your capital and actually buy back more stock in a more aggressive fashion?

We cannot discuss that.

I mean (indiscernible) in an ear turn it won’t happen in any case.

The next question is from Rick Rosenthal with Bear, Stearns, please go ahead.

Hi, how’s it going?

Just actually, I also had a question on the share repurchase, so yeah, I wanted to know, I guess it’s the blackout period, I wanted to know why in the middle of March I guess you guys stopped repurchasing the shares and if there was an indication cause you had mentioned going forward your share repurchases would be dependent on how high you thought the share price was.

Right and because that’s the rules of the (indiscernible).

Because of what?

Well we try to follow the New York Stock Exchange rules as well as the Stockholm Stock Exchange rules.

Okay so then, I mean given that the price is significantly lower than where it was in the middle of March, you know, I couldn’t clearly understand what you were saying about you know what your guys actions are you know possibly in the upcoming weeks.

(Indiscernible) because basically we said that we want to take a position on Monday and we want to make [it known] immediately.

It’s not unlikely they support buying macro shares.

I’m sorry, not unlikely?

Yes.

I mean it is likely?

You could say so if you like.

Okay, thank you.

The next question comes from the line of Scott Merlis from Thomas Weisel Partners, please go ahead.

Alright, yeah, just briefly, Magnus I think clarified, you’re not changing any of your grown outlook are you?

In other words, Magnus said 3% and 2% means 5% for the industry so does that imply you’re not changing your growth outlook because there seems to be some confusion before about your longer-term growth outlook.

Well you know it is based on the underlying core production that’s in (indiscernible).

Nothing can (indiscernible) like 3% if you take the whole world and (indiscernible) more like 2 probably.

Should that (indiscernible) believed to be round-the-tree roughly, between 5% to 6% basic on the underlying growth.

Right so there seemed some confusion before but you know the point is you’re not changing your underlying your longer term growth outlook, it’s what you said you basically have said that in previous conference calls right?

Well basically we say that probably we’ve known the trend when it comes down to the industry and that is about 5% to 6% then given no one could actually (indiscernible).

There are no additional questions at this time sir.

You may proceed with your closing remarks.

Very good so from Stockholm (indiscernible) we’d like to thank you for all these questions and then we look forward to talk to you again in July to discuss the half year results and I guess raw materials and raw (indiscernible).

So thank you very much for today.

Bye Bye.

Ladies and gentlemen, thank you for joining today’s conference.

This concludes your presentation and I’ll disconnect.

Good day.