Fresh Del Monte Produce Inc (FDP) 2005 Q1 法說會逐字稿

Good morning everyone. I would like to remind you that today's call is being recorded and that all lines will be muted during the call. After the presentation, we will begin the question and answer session.[OPERATOR INSTRUCTIONS]. And now I'd like to turn the call over to Christine Cannella for opening remarks. Please go ahead.

Thank you Jimmy. Good morning everyone and welcome to Fresh Del Monte Produce's first quarter 2005 conference call. I am Christine Cannella, Assistant Vice President of Investor Relations. Joining us today are Chairman and Chief Executive Officer, Mohammad Abu-Ghazaleh and Executive Vice President and Chief Financial Officer, John Inserra who will discuss our results for the first quarter ended April 1, 2005.

Fresh Del Monte issued a press release this morning via business wire, email, and First Call. If you have not received a copy of the earnings release, please contact [Inaudible] at 305-520-8156. You may also visit our Website at www.freshdelmonte.com to register for future distribution. This conference call is being web cast live on our Website and it will be available for replay approximately two hours after conclusion of this call.

This morning, Mohammad will review our first quarter operating performance along with recent developments and our future outlook. John will then review our financial performance for the quarter. Please let me remind you that much of the information that we will discuss this morning including the answers we give in response to your questions may include forward-looking statements regarding our belief and current expectations with respect to various matters. These forward-looking statements are intended to fall within the Safe Harbor Provisions of the Securities line. Our actual results may differ materially from those in the forward-looking statements as a result of various factors including those described under the heading `Description of Business Risk Factors` in our Form 20-FA for the year-ended December, 31 2004. This call is the property of Fresh Del Monte Produce and its redistribution, retransmission, or rebroadcast in any form without written consent is strictly prohibited. With that, I would like to turn the call over to Mohammad Abu-Ghazaleh. Mohammad?

Thank you, Christine and good morning everyone. Fresh Del Monte had a solid first quarter earnings with higher overall net sales of $839 million and good performance across nearly all of our product lines. Banana pricing, sales and gross profits were all significantly higher. Gold pineapple sales and volumes increased, melon sales and profits rose, and fresh-cut sales and volumes expanded substantially.

We are pleased to deliver this strong earnings performance at the time when our Company faced higher fuel prices, spot charter rates, containerboard, and template (ph) cost. We view our ability to deliver these results while driving a complex corporate integration and coping with higher raw material and transportation cost as further evidence of the skills of our management team and the verifility (ph) of our business. There are no questions that our efforts to integrate the European fruits business defined our activities for much of the quarter.

During this period, we instituted changes on many few fronts and our efforts began to payoff. For example, we re-introduced Del Monte canned tomato products in France and we began to plan the roll out of these products in other European markets in the near future. We expanded our juice-vending machine business in the UK. We began reengineering our snack products, Fruit Express improving the products packaging, sales, sourcing and quality. The new and improved product will be launched in the UK in June and the rest of Europe later in 2005. We expanded our prepared fruit sourcing to add Chile and Argentina to our left, which included Kenya, Greece, and South Africa.

In addition, we completed the expansion of our European business leadership team. We leveraged our infrastructure in offices in Asia-Pacific to begin marketing now Del Monte branded prepared products in that region. And, we also established a new office in Milan, Italy and built a new sales path for the Middle East. During the quarter, we also drove a number of other operating improvements in the prepared foods business, which were designed to deliver long-term benefits to our business.

In Kenya, for example, we streamlined operations at our pineapple plantations and tanneries appointed a new management team and began to leverage our expertise in agricultural processes to replicate the success we have experienced elsewhere in growing pineapples. The tremendous progress that we made during the quarter was all the more rewarding because of the extent of this array as the prepared foods company when we first acquired it.

Our management team took control and we moved to rationalize our offices to put the right people in the right jobs and to outline our goals. These early signs of success reinforce our confidence that we are on the right track. To propel us towards our goals, we have allocated a substantial thumb to print, broadcast and super-market point of sale advertising and cross promotions in 2005. While this will initially require a significant investment on our path we believe that this move will pay off as we established and/or repositioned the Del Monte brand in key markets and drove new consumers to our expanded product line.

The new products will be a major focus for Fresh Del Monte as we move forward. We set the pace in the first quarter and earlier in the second quarter of 2005 by launching several new products including a new fruit jelly called Wobble-icious, very funny name, which we created specifically for McDonalds in the UK. And the healthy new snack called [Inaudible] , which complements our current offering of apple and grape bags at 1250 McDonald's outlets in the UK. Consumer response to these products has been favorable and we expect to continue to launch products like these in the future either through supermarkets or through quick-serve outlets.

We continue to make the dramatic inroads into the Fresh-cut arena during the first quarter increasing sales 55% over the same quarter last year. Part of this increase is attributed to our new and highly successful alliances including our relationship with Wendy's International Inc, a partnership that is exceeding both Wendy's and our own expectations.

As you know, through this new alliance, we have provided a fresh-cut melon, pineapple, and grapes for Wendy's new fruit bowl and cup offerings at their 6,600 outlets in North America and international markets. Wendy's has backed its offering of our fresh-cut products with a national advertising campaign. We are now building on rising consumer interest in fresh-cut fruits and vegetables to attract several other new quick sell customers and alternative outlets as well.

Fresh-cut produce of course is one of Fresh Del Monte's most exciting and talked about businesses. Gradually, every one in our industry is enthusiastic about the potential of fresh-cut products in general. Nonetheless, we are confident that our leadership position in this fast growing category is secure, primarily because of our headstart as well as our significant fresh-cut competencies. Five years ago, our experienced management team recognized the future potential of fresh-cut produce. Our team knew that it would give us a platform to capitalize on rising consumer interest in healthy prepackaged foods and convenient eating.

It would also offer us a competitive advantage by enabling us to add value to our whole produce line. We acted on our vision and created an exciting reality, an outstanding and unparallel position in fresh-cut produce. We are proud of our advancement in this arena, including in the UK, where our business is expanding and where we are setting new sales records each week. In fact, the UK will continue to be a major growth market for fresh-cuts as well as our prepared products.

We will soon launch our new purely summer season and juice lines in the UK along with other products ranging from summer fruit salads with strawberries to pineapple half slices and watermelon half slices. As you know, the USDA produced new food pyramid last week that's worth a mention. The new food pyramids, which are geared to help people become slimmer and healthier, place an even great emphasis on the consumption of fruit and vegetables. In fact, the USDA's new recommendations are that people consume 2 cups of fruit and 2-1/2 cups of vegetables every day, an increase over past recommended level that could potentially boost consumer interest across all of our product categories and benefit our fresh cut sales over time.

For these reasons and others, we are optimistic about our future. I should mention that we remain positive on our future outlook for our Gold Pineapple business, due in part to severe weather conditions on the Pacific Coast of Costa Rica. The quality of the Gold Pineapples being grown by our Company in France is outstanding, providing us with an advantage over our Costa Rica, Atlantic coast competitors, where the weather has not been favorable. Quality and consistency in the eastern region have suffered, factors that position us well with discriminating super market buyers.

At the same time, we recognize that we still face a number of challenges including escalating fuel cost and the impact on other material cost. Indeed, as our business in North America expands, transportation becomes an increasingly important factor in our business outlook. As you know, we have expanded our truck lead and we are now utilizing our own proprietary logistics network to make deliveries to companies like Wendy's and transport products to and from our distribution centers.

While these developments have enabled us to gain greater control over our basically integrated network and to improve efficiencies, they still subject us to uncontrollable containerboard, fuel, and template costs, which cause us significant concern. At the same time, we see many opportunities to generate new profits. If we make the appropriate capital investments, for example, we will invest in the expansion of our pineapple and non-tropical growing operations in the Philippines and Central and South America to meet rising consumption and consumer demand for our products.

We will also modernize some of our prepared food facilities and equipments in such places as Greece, Italy, Kenya, and South Africa, bringing them up to our Company standards and improving product qualities. At this juncture in 2005, when we weigh our substantial future opportunities against the challenges ahead, we believe that our previously announced EPS guidance of $2.30 to $2.40 for the year is appropriate. And we offered that guidance today. Our position is that 2005 is a transitional year for our Company, and I repeat a transitional year for our Company, in which we are maturing from a pure fresh produce company to a diversified fruit company, while we implement this transition you can be sure that we will try to improve our operation and deliver solid results as we move forward. At this point, I would like John to give you the financial details.

Thank you Mohammad and good morning. In spite of challenging market conditions, particularly high fuel and fruit cost, prevalent in most of our product lines around the world, Fresh Del Monte products turned in solid financial performance for the first quarter of 2005. Net sales were $839 million compared with $714 million in the first quarter of 2004. Net income was $58 million compared with $47 million in the prior year period. Gross profit was a $117 million compared with $77 million in the first quarter of 2004. Earnings per diluted share were $1.04 excluding a $0.04 asset impairment charge in our North American business compared with $0.81 last year at this time.

Let's now review the 2005 first quarter performance of our different business segments. Banana net sales increased to $273 million compared with $264 million in the first quarter of last year. Banana pricing worldwide rose 19% to $11.73 from $9.86 last year at this time. Banana pricing was strong in our three regions North America, Europe, and Asia with particular good local currency pricing in the UK and Western Europe. Pricing is a function of supply, which was affected during the quarter by flooding on the Costa Rican and Panamanian border and a sustained drought in the Philippine.

The increase in selling prices was partially offset by a decrease in volume and a significant increase in ocean freight, inland transportation and other operating cost which we expect to continue throughout the year. Dynamic gross profit rose by $19 million quarter over quarter to $34 million compared with $50 million last year. In our other fresh produce category, net sales rose by 6% to $441 million compared with $418 million in the 2004 first quarter.

Overall, volumes were slightly lower than the prior year period. Gross profit for other fresh produce grew 10% to $66 million from $60 million for the same period last year. Overall, net sales of gold pineapple increased 8% with strong volume growth in all markets and higher pricing in Asia. We also had good first quarter in melons compared with last year at this time.

Overall, we saw higher net sales and slightly lower volumes due to plant disease during the fourth quarter of 2004 in Guatemala, which negatively impacted first quarter 2005 crop yields. It's worthwhile to mention that product quality and yields improved later in the first quarter. Melon prices were higher during the first quarter though it was offset to some extent by higher operating cost. Net sales and volumes in our tropical, non-tropical product line decreased while grape sales increased 5%. Decreases in our non-tropical line were due primarily to weak selling fruit demand.

We are acting on market opportunities by focusing greater attention on our more profitable non-tropical product line such as grapes. The decrease in non-tropical sales and volumes were partially offset by higher pricing and the benefit of favorable exchange rate. Both net sales and volumes in tomatoes were in line with last year at this time. The tomato market continues to be affected by inclement weather, which subjects us to highest spot pricing, as this is a product that we do not grow ourselves. Fresh-cut net sales rose by 55% to $82 million, from $53 million during the same quarter last year. Approximately $21 million of this $29 million increase came from our North American region and the balance came from the UK, where we topped $32 million in sales, up from $23 million last year at this time.

Overall, fresh-cut volumes rose 46%. We attribute this increase in sales to the appeal of our new product line. Greater demand for fresh-cut products, by major quick served customers and retail supermarket chains as a continually [Inaudible] expanding market for fresh-cut products. Net sales of our prepared foods were $79 million in the first quarter of 2005, contributing 9% of the Fresh Del Monte's total net sales. Gross profit was $12 million with a 16% profit margin. We expect to see improvement in our foods business as we move forward.

In our other products and services business, net sales increased 43% for the quarter, primarily due to third party freight business and the increased success of our poultry and Chilean plastic businesses. Gross profit in the other products and service category increased to $5 million from $3 million in the same quarter of last year. For the quarter, we realized a prime currency benefits in net sales of $20 million due to the continued strength of major currencies we sell in against the US dollar.

Selling, General and Administrative Expenses increased $17 million, of this total $13 million was incurred in the European prepared food business, which were in line with SG&A expenses in the fourth quarter of 2004. The balance was attributed to increased promotion expense in fresh products, professional fees for Sarbanes-Oxley and the roll out of our new IT system. Interest expense for the quarter was $4 million, an increase of $3 million over last year at this time.

Due to the current debt balance that we carried associated with the acquisition of our prepared food business and working capital requirements in our canning operations in South Africa and Kenya. Taxes for the quarter were consistent with tax rates of last year. Our debt level; during the quarter increased slightly to $381 million as we ramp up canning production in Kenya and South Africa, our working capital needs increase along with our inventory levels on prepared products. As we said earlier, we are pleased to have delivered this strong performance in spite of challenging market conditions. Jimmy, could you open up the lines for question and answers, Thank you.

[OPERATOR INSTRUCTIONS] Terry Bivens, Bear Stearns.

Couple of quick things. John could you give us a number on the contribution of Del Monte Europe to the top line?

The top line of Del Monte Europe?

Yes.

79 million in sales, Terry.

Just in terms of the integration cost, you did separate here an impairment cost but, the question integration cost, I assume you are incurring some of those and running them through the P&L. Is that first of all correct? And if it is, could you give us some idea of the magnitude of those?

At this time Terry we have integrated the offices between the Company so, it is very difficult for us to pin a number on that. It is included in our overall cost.

Okay, but there is some what we could consider one time there’s being run through there that you’re simply just --?

Right, new people on the those kinds of things for hiring and so forth of course were expensive.

Okay. And just in terms of the fresh-cut business, obviously Mohammad, that's going quite well. We are always interested to hear your views though on where it might be expanded to, you made a reference this morning perhaps to other quick serve restaurants. Can you give us a little more color on where you think that business could go?

The business for fresh-cut, the limit is the sky, in my opinion, Terry. When we -- I wish we had recording of our conference calls, going back maybe the last 3, 4 years, when I was speaking about fresh-cuts and where we were going and I believe that the attention was not yet focused on this, but I've been always a believer in the fresh-cuts and I wanted to do and ultimately it caught up. We are discussing right now with several other interested parties, and I think the interest is catching up very quickly now in the market, be it in North America and other parts of the world, you know, we are not just focusing in North America, but we are very much active in Europe, especially in the UK, as you know, and we are going into new areas as well in the fresh-cut, new markets that have not been touched before, which I cannot disclose at this moment, but I think that the potential for growth is very, very promising, very phenomenal. For 2005, our projection is about 375 million in sales, just in fresh-cut.

Okay. very good, thank you.

Leonard Teitelbaum, Merrill Lynch.

Good morning. Just -- let me just piggyback a little bit on Terry's question, because on the fresh-cuts, when we were talking about it originally, we thought the margins could be in the high teens. Given what has developed over the last few months, would you say that might be aggressive and should be closer to the mid teens or you're still sitting with the high teen estimate for operating margins?

No, I think it will get to the low teens at this point, you know, we are in the ramp up stage. As you ramp up of course costs will be higher, but as we go forward, we see that leveling off and the utilization is moving up.

Cadburys announced that the acquisition of Fresh Express has been delayed. I don't know exactly where, you know, whether that's a euphemism to say they are having trouble with it or what I don't want to read anything into it, I'm just saying that if for whatever reason that were to come up again, would you be interested in that?

With the right price, maybe yes.

That’s as good an answer as I could hope for. Okay, a couple of other questions. John, we got some numbers here that indicate banana prices have kind of pulled back. Is that -- are we looking at some bad data?

Banana prices, I think, are a little difficult now, we've seen some issues with pricing becoming difficult in this quarter.

Now, Mohammad, when you look at the business, clearly Europe has changed the profile and the earnings predictability, but more or less the profile of the Company, is the emphasis going to be now, since you only have 1 number, 1, would the first priority be to push the integration of Europe ahead of expanding the fresh-cut business?

No, no, no, no. They are going federal. Fresh-cuts is -- we have been working very hard on the fresh-cut for the last 7 years, I mean, it's not yesterday and we are not going to give up once we reach where we are today, I mean we are going very, very aggressively on the fresh-cut. We are building our market share, I mean, very steadily, and we have proved that we are the reliable supplier for anybody that wants to go national in North America or the UK. So that's -- our focus on the prepared and the food section is not going to be on the account of the fresh-cut business. We estimate within the next 2 years, I believe that will be over $500 million in the fresh-cut business.

Now that obviously presumes you are going to have to have more than Wendy's in the US and McDonald's in Europe or would those two companies do it?

No, really Lenny, I mean, you will be surprised how much more interest is coming from not only the quick service, let's say, sector, but the retail as well from food service segment. From all fronts, we are getting and we are producing new products, we are producing new, you know, new innovations or something that gives additional appeal to the consumer. So, we are really addressing not only one sector, which is a very important sector, which is the quick service, but we see growth in all fronts.

Thank you. Then one final question. I don't know, Mohammad, whether you or John want to answer, but I think we are getting near the -- where you just got to sit down and decide what it's going to do with quarters, I know they've been in the paper today and I’m certain other types of adjustments to be made. Have you heard anything or can you give us any outlook as to what it might be for the quota systems regarding imported bananas?

Well, as far as it is today, we still believe that the entire system will be implemented, you know, beginning of 2006 and that's the kind of system that we would like to be in place, that has been our position from the start. Negotiation has been -- is ongoing and hopefully that they come to -- of course there is -- the conflict on the [Inaudible] itself which is, you know, the core market wants 250 Euros per ton, of course maybe this is a very high rate to apply and there is negotiation on that front.

Didn't you say at one point that if there was no change in the quarter in the allocations that you would still be at a disadvantage to Chiquita or did I hear that wrong?

No, that is true, I mean, if -- that's not only ourselves, but many other players will be at disadvantage and that we do not agree with.

Okay. John, have you given any indication as to what the next quarter or so is going to look like or you're just going to stay with the annual guidance?

Yes, we are staying with the annual guidance.

Okay, thank you very much. Good quarter.

[OPERATOR INSTRUCTIONS] Jon Feeney, Wachovia Securities.

Quick follow up, Mohammad, you mentioned this week you feel very good about, you know, your position and the quality of your product and you know where you stand market share wise in the Sweet Gold pineapple business. The way I kind of look at it is you know you have some competitors who, you know, were still very much in the process of coming after you and trying get more of that share. What is it other than, say, the Honey Gold, I mean what is it about the core Sweet Gold pineapple that going forward is going to allow you to compete? Is it really a quality issue or is it more a distribution issue, which then allows you to kind of compete retain market share and maybe you can grow market share over time?

Well, we're -- I would say that we are the most consistent quality producer in the sector as far as the pineapples in general, be it Del Monte Gold or others, but that's -- and I think that's one of the first advantages. Secondly, I think the Del Monte brand is well respected and demanded by the consumers, be it in North America or Europe. So, we have seen our position actually not being in anyway jeopardized over the last two years, though the volume has increased substantially, I mean, dramatically, and we see competition increasing every day. However, we have -- of course we have seen some softness in the pricing from time-to-time and definitely not as high as we were enjoying 3 years back or earlier, but I think we are quite subscribed with our position. I believe that our continuous expansion, you know, in the fresh-cut will give us even an additional leverage as far as our position in the market with the pineapples, you know, where we can supply the right sizes for the right customers and there is a lot of issues here that we cannot discuss on a conversation. However, we have to take into consideration as well the Honey Gold, which will be rolled out next year, which I think is going to make also a very interesting response in the market. I believe that we have seen now some samples of the day, the new product, and we are very, very enthusiastic about it really, it's just coming out to be just as we anticipated. So, we are very, very anxious to see it, you know, coming on the market soon next year.

And as I understand it Mohammad, that's a unique product, right, the actual genetic makeup of the taste profile is unique?

They're unique -- they are unique from the Del Monte Gold, yes.

Okay. Just one other question for anyone really. When you look at -- obviously you had a terrific quarter and I jumped on the call a little bit late, so forgive me if I didn't -- if I missed something about it, but the Del Monte Europe acquisition, you know, as you proceed with that, a tremendous amount of opportunity, I see this big number, on recovery in bananas and then I guess I'm tempted to think that, you know, some things are maybe going your way there earningswise a little bit faster than you expected, would that be a fair characterization?

You mean as far – no.

As far as Del Monte Europe goes.

No. We are very confident about our prepared business. I mean, Europe will be one part of the business, don't forget that. Del Monte Food Europe was really at worst, I mean, covering six companies and not in a very efficient and aggressive manner. We have a hundred countries within our geographical coverage with the Del Monte Europe acquisition. I mean just imagine the opportunity and the potential that we are going to have and we are having right now in penetrating these new markets that we have never been -- we have never even touched. So, we are extremely, extremely positive about the prepared food and I have no doubt in my mind that within the next year or two, you will see a significant growth in this sector and a completely different Company, I mean, Fresh Del Monte, will not be the company that you see today with only fresh produce and cyclical items. We will have a company that will deliver consistent and stable and solid results in the future.

Is this just as far as this quarter? Mohammad, was there any kind of major earnings contributions surprise from that Europe business or is it just more next 12 months then?

No, I think that right now we are just consolidating our position, we are restructuring, we are putting the right management team in place, we are rationalizing the business, we are controlling the course. But we see a lot of improvements going on right now. But real contribution, no not yet, I believe that we have to wait for another several months or one year to see really the real contribution.

Excellent. Thank you.

Eric Larson, Piper Jaffray.

Good morning everyone. A quick question on kind of this outlook again for the second quarter. Your banana pricing was difficult last year. Was it not John? Shouldn't you have some favorable benefits in Q2?

In banana pricing, I think last year we did very well in the second quarter and it was our best quarter last year.

Okay. I will go back and check that comparison.

Yes. I think overall we did decently there.

And then as you go through your year and you integrate that European Del Monte business. Would you expect that your tax rate would go up overall, in general as you have more European tax liabilities?

Not now with the European business, the question will be the US business. That could effect the tax rates.

Heather Jones, BB&T Capital Markets.

Good morning. What would be your volumes in bananas, you said down, how much were they down?

Volumes were down by 13%.

Okay. Going to the first cut. Just a point of clarification. Did you say low teens, is that an EBIT margin goal or a gross margin goal for what you think it could be in 2 or 3 years?

We only talk gross profits.

I was just curious about what is going on the cost side? Because on a per-box basis, your costs were up over 10% in the quarter and this is for bananas and that is the same trend that was in Q4 and I just was wondering. I was reviewing your 20 F and your [Inaudible] fuel and containerboard is running like 9 million extra for all of last year. So it doesn't seem like that could be the increase you are seeing on your per-box cost could be entirely attributable to that. Now I was just wondering what other cost pressures you are seeing in your banana business?

Now we are having cost pressures in fuel and containerboard, if those are the numbers and you are reading records, it is better than mine, but we are significantly, probably over $5 million in the first quarter. So as you can see that is big big time money.

Right. That was for the fuel and containerboard?

Fuel and containerboard.

And the asset impairment charge in the quarter was that related to a DC?

It relates to our North American Business.

I have two more questions Del Monte Europe, what are you guiding to as far as earnings accretion, because I think you said the $12 million growth profit and SG&A ramp $13 million. So you lost money in the quarter. Are you guiding to breakeven for the year?

I think the last guidance, we were optimistic about the business and we will have to see as we go through the year, but we haven't provided any recent guidance.

And my final question is, I may have done it wrong, but I was just looking at your balance sheet relative to end of year. Looks like you may have had to fund, your dividend with that, and I was just wondering if you have a cash flow projection for the year?

We haven't disclosed that publicly, the cash flow projection for the year. But since we use all the cash to pay down debt every day, your analysis is correct, but I don't think it would be correct if you didn't have a revolving credit facility. It is the nature of our debt that makes that a true statement.

[OPERATOR INSTRUCTIONS]. Leonard Teitelbaum.

John, again, I don't want to tinker with a real good story here and confuse it with numbers, but I've got myself a problem and maybe you can straight me out. If I take all the extraordinary out of last year, we did about 241 and you are guiding to 230 to 240 for this year. Now, we've already done $0.19 in the first quarter, that would indicate at least for one or two of the quarters, we are going to have some negative comparisons, I would think. Is that in your projection, specifically the June quarter I would think? And I'm not looking for any negatives here, I'm just trying to make sure my expectations are correct.

Well, no, I think, as we saw in banana pricing, the second quarter probably will be difficult, as far as that's concerned.

Okay. And I would guess with fuel the sub quarters is going to get a little rugged, but I just cannot believe the way you've managed the finances here that, you know, things aren't going to work out pretty well, because frankly, I'm above where you had guided, I'm inclined to stay that way, but I think we've got a -- I think it helped -- helped you and helped us too to know that if the second quarter is going to be a challenge then let's get it on the table and work through it. So, I mean is that the right way to look at this thing or we're being too negative?

No, I think we need to look at the second quarter as being challenging.

Okay. Alright, good, because I'm Diane’s numbers are right, I just want to make sure I haven't read into something here different. Thank you very much guys.

And that concludes the time allocated for the question and answer session. I will now turn the call over to Mr. Abu-Ghazaleh. Please go ahead for closing comments.

Thank you very much for everyone and we are happy to be with you on this conference call and look forward to be with better news on our next conference call. And have a good day. Thank you.

And that does conclude our conference here, and thank you all for participating. We hope you will enjoy the rest of your day.