Materialise NV (MTLS) 2015 Q2 法說會逐字稿

Good day, ladies and gentlemen, and welcome to the Materialise NV second-quarter 2015 financial results. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session, and instructions will follow at that time. (Operator Instructions) As a reminder, this conference call is being recorded.

I would now like to turn the conference over to Jody Burfening. Please begin.

Thank you, Latoya. And thank you, everyone, for joining us today for Materialise second-quarter earnings conference call. With us on the call are Fried Vancraen, Founder and Chief Executive Officer of Materialise; Peter Leys, Executive Chairman; and Frederic Merckx, Chief Financial Officer.

Today's call and webcast are being accompanied by a slide presentation that reviews Materialise's strategic, operational and financial performance for the second quarter. To access the slides, if you have not already done so, please go to the Investors section of the Company's website at www.materialise.com. The earnings press release that was issued earlier this morning can also be found on this page.

Before we get started, I would like to remind you that management may make forward-looking statements regarding the Company's plans, expectations and growth prospects, among other things. These forward-looking statements are subject to known and unknown uncertainties and risks that could cause actual results to differ materially from the expectations expressed, including competitive dynamics and industry change.

Any forward-looking statements, including those related to the Company's future results and activities, represent management's estimates as of today, and should not be relied upon as representing their estimates as of any subsequent date. Management disclaims any duty to update or revise any forward-looking statements to reflect future events or changes in expectations. A more detailed description of the risks and uncertainties and other factors that may impact the Company's future business or financial results can be found in the 20-F for the fiscal year ended December 31, 2014, filed with the SEC on April 30, 2015.

Finally, management will discuss certain non-IFRS measures on today's conference call. A reconciliation table is contained in the earnings release and at the end of the slide presentation.

With that, I would now like to turn the call over to Fried. Fried, good morning.

Thank you, Jody, and thank you, everyone, for joining us today. The agenda for our call is on slide 3. I will begin with a brief recap of our results for the quarter, after which Frederic will take you through the numbers in more detail. Peter will then run through our operational performance for the past quarter and our priorities for Q3. After we have completed our prepared remarks, we will be happy to answer your questions.

So let's take a look at the highlights of our second quarter results, which are summarized on slide 4. Our second-quarter marks the anniversary of our IPO in June last year. We have been consistently executing on our strategy of offering a unique combination of software and printing services to high-end subsegments of the additive manufacturing industry.

This focus produced another quarter of strong revenue growth. In fact, this was the second consecutive period for which we posted topline growth of more than 20%, both organically and nonorganically. Including OrthoView, revenue increased 29%, and on an organic basis, revenue grew 23%.

Like last quarter, we had a strong contribution from software sales. This time, aggregate software sales accounted for 37% of total revenue, up 600 basis points over last year on the strength of a 45% increase in 3-D printing software sales. If anything, this number actually understates the growing importance of our software activities, since it doesn't factor in their contribution to our end parts manufacturing process, such as for our guide business.

As you know, we have been investing heavily in the short-term by expanding our global sales force and growing our new product portfolio. In total, sales of marketing and research and development expenses increased 44% compared to last year.

This is, however, a smaller rate of increase than our first-quarter comparison, where the increase was 55%. We believe we have substantially finished the major step-up in building our infrastructure to support future revenue growth, and that a cost of these efforts for which we used a part of the IPO process are reaching their peak when expressed as a percentage of revenues. Going forward, it is our intention to make these costs grow in absolute numbers at a slower pace than our revenues.

Adjusted EBITDA for the quarter fell to a small loss of EUR179,000. Overall, we are very pleased with our results for both this quarter and the first six months of 2015. Obviously, within EBITDA that was budgeted at close to zero for the first half of the year, small timing differences can have a rather high percentage impact.

An example of an achievement that we expect to lift our gross margin going forward is the fact that our internal production line for medical implants was fully certified at the end of the second quarter. As a result, in the second half of the year, we will no longer incur the double costs of subcontracting the production of our own products on the one hand, and of testing and certifying our own production line on the other hand.

So, to conclude, we are pleased with the quarter and also with the first half of the year. We performed to plan, and I want to thank our employees worldwide for their efforts and contributions.

Now, I will turn the call over to Frederic to give you more details on our results.

Thank you, Fried. I'll start with a brief review of our Company's latest results on slide 5. Following a strong first quarter, we generated double-digit revenue increases in each of our segments for the second quarter, led once again by our software revenue segment.

As a percent of revenue, industrial production accounted for 42% of our revenue in Q2; medical, 33%; and software, 25%. Together, revenue from software sales and end parts contributed 70% of total revenue. Breaking down our topline performance by type of business, revenue from software sales, including both 3-D printing and medical software, account for 37% of our total Q2 revenue, compared to 31% in the same quarter of last year.

Revenue from end parts manufacturing, including medical end parts, represented approximately 33% of Q2 revenue. The remaining 30% were generated through the production of prototypes. As a result of the investments we have been making in expanding our sales coverage and new product developments, sales and marketing and research and development expense were up 44% higher than last year.

Similar to the first quarter, this investment resulted in a small adjusted EBITDA loss of EUR179,000 for the quarter, bringing the margin down from 7.1% to minus 0.7%. As a reminder, we fully expensed R&D spending for the second quarter.

Please turn to slide 6 for details about the Q2 performance of our 3-D printing software segment. Revenue grew 45%, fueled by our expanded product portfolio, which now includes our build processors. For the third consecutive quarter, we delivered a year-over-year increase in sales from new software licenses of at least 50% on the strength of solid execution across all regions and particularly in Asia.

Revenues generated from and through printed OEMs accelerated as deposit and increase of 134% following a first-quarter gain of 94%. Sales in Asia grew 65%, reflecting continuous cultivation of opportunities in China. EBITDA grew 19%, where the EBITDA margin fell to 33.2%, reflecting a 71% or EUR1.5 million combined increase in sales and marketing and R&D expenses.

Turning to slide 7, you will see that total revenue in our medical segment grew 60%, while sales of medical software increased by 84%. Increases in both medical software sales and total revenue for the medical segment reflect the inclusion of OrthoView. On an organic basis, segment revenue was flat while revenue from medical software licenses grew nicely at 18%.

In total, medical software sales now represent 39% of total medical segment revenue, up from 25% for the second quarter of last year. Also on an organic basis, annual licenses as a percentage of new license sales more than doubled to 49%. Revenue for the direct sales of complex surgery devices continued to grow, increasing 28% over the last year's second-quarter.

With revenue from sales of medical software and from direct sales of complex surgery devices, each becoming larger pieces of medical segment revenue, we continue to make up successfully for the declining contribution of revenue from Zimmer and biomed. Although revenue increased, EBITDA for the medical segment declined from EUR793,000 in the prior year to a loss of EUR342,000, reflecting a EUR1.3 million planned increase investment in sales and marketing and R&D expenses. As a result, EBITDA margin declined to minus 4.1% from 11.1%.

Please turn to slide 8 for a summary of our Q2 industrial production segment results. Revenue rose 30% with sales of end parts increasing 40% over last year second-quarter and accounting for 29% of the segment's revenue, up from [37%] last year. We added 19 printers, bringing our total to 129. Sales from our two growth businesses, RapidFit and i.materialise, grew 40% for the quarter.

EBITDA declined to a loss of EUR147,000 from a gain of EUR500,000 for the same period last year. Excluding i.materialise and RapidFit, the EBITDA margin was 8.4% compared to 13.9% for the same quarter of last year, reflecting increased investment in sales and marketing, startup costs associated with our 19 new printers, as well as an increased outsourcing to manage the steep growth.

Slide 9 provides the highlights of our income statement for the second quarter. Similar to the first quarter, gross profit increased 22% year-over-year while gross margin decreased to [57.8%] from 60.8% for last year second-quarter, mainly due to a substantial increase in depreciation expense associated with our purchase of 19 new printers over this past fourth quarter.

Research and development expense spending rose EUR800,000 or 23% over last year. Sales and marketing were EUR3.5 million up or 56%, and general and administrative expenses increased EUR750,000 or 25%. Part of these variances are attributable to OrthoView sales and marketing expense, which are included in the 2015 numbers.

Other income net increased by EUR400,000 to EUR1.5 million and include EUR1.3 million related to [regarding] tax exemptions for qualifying researchers and partial funding of R&D projects versus a comparable income of EUR954,000 in the prior period. With a gross profit increase of EUR2.6 million only partially compensating for the planned investments in R&D and sales and marketing expenses, we posted an operating loss of EUR1.9 million compared to a small operating profit of EUR51,000 for the same quarter of last year.

Financial expenses, net increased significantly versus last year from EUR210,000 to EUR1.3 million, due to an unrealized exchange loss on the portion of IPO proceeds held in US dollars. This means we balanced against the much higher exchange profits realized in Q1.

Please turn to slide 10 for a recap of balance sheet and cash flow highlights. Our balance sheet remains strong with minimal debt, accounting for only 12% of total capital at quarter-end. We ended the quarter with cash and cash equivalents, including held to maturity investments of EUR52.7 million compared to EUR61 million at the end of December 2014. Capital expenditures were EUR1.2 million, similar to second quarter of last year, while cash flow from operations decreased to EUR543,000 from EUR3.2 million last year, reflecting lower EBITDA and increased working capital associated with higher sales.

With that overview, I will turn the call over to Peter to discuss our operational highlights.

Thank you, Frederic. If you could all please turn to slide 11, where we have summarized our operational performance for the second-quarter, and where we've also listed our top priorities for the current periods. Following our usual format, I would like to begin with our 3-D printing software segment.

As you know, enhancing our already strong position with the industrial users of 3-D printers is a key strategic objective for Materialise. To that end during the second quarter, we continue to roll out our build processor program collaborating with two new machine manufacturers in that quarter.

Moving to the second point, some of you have been asking if we plan to join the 3MF Consortium, the Industry Association formed this spring to develop and promote a new file format for 3-D printing. As we shared Consortium's goal of improving where necessary or appropriate the transfer of data to an ever-expanding variety of machines, we did join the Consortium in June of this year.

Now, turning to the right side of the first row on slide 11, I would like to run you through our operating priorities for the third quarter in our Software segment. As Frederick mentioned, sales from our build processor program have been contributing nicely to our revenue growth throughout this year.

So you can be sure that this program will be an ongoing priority for us, although not necessarily one that we will continue to discuss in each quarterly conference call going forward. We intend to announce the launch of further build processors with certain partners as for the Bright Laser build processor we launched in July, so that you can keep track of our process in that way.

Moving on to another initiative, our Attitudes Manufacturing Control platform. You may recall that we have been developing a platform with high performance embedded software to address the growing demand for greater control over quality and repeatability in the production of end parts. This has been an important focus of our R&D efforts. And just like with our build processors, things are off to a fast start.

Already in the first half of the third quarter, we have made the first commercial sales of our AMCP. And our salesforce continues to gain traction for this newest addition to our suite of software products. In last quarter's call, I mentioned that we were also gearing up to gradually extend our software offering to a broader group. To that end, we launched the Materialise 3DPrintCloud in July of this year.

This is a strategic initiative whose purpose is to expand general awareness of our capabilities. And in the short-term, we expect to generate only modest revenue from this initiative. Over the longer-term, however, we do intend to develop our 3DPrintCloud platform as an alternative trial to bring our software solutions to the market, not only in a B2C but also in a B2B setting.

Now, let's move to the second band on slide 11, and go over some of the accomplishments of our medical segment during the past quarter. As Fried's already pointed out, we completed the process of bringing the production of all our complex surgery products in-house, which positions us very well to fully independently scale-up the sales of our own patient-specific implants.

Very importantly, our medical segment has made excellent progress in expanding and diversifying our strategic partnerships for our surgical guide platform. During the past quarter, we added consensus to our platform for knee guides. During the first half of this quarter, both Consensus and JMDM in Japan joined our platform for hip guides.

Even more recently, we also welcomed Lima as a partner for partial knee guides in Europe. Simultaneously, we continue to see promising growth from some of our existing partners, which include, as you know, Synthes and DJO. Now that the merger between Zimmer and Biomet has closed, we have also initiated discussions with the Zimmer Biomed Group with respect to our relationship going forward. For your information, Biomet extended our ongoing agreement for hip guides, and Zimmer did exactly the same for our knee guides collaboration.

Our priority for the near future in the medical segment is to continue to focus on our guide platform, as 3-D printing becomes an even more and more widely accepted part of surgical planning. Building on the widespread interest in our surgical guide technology, our clinical team will continue to foster both new and existing relationships to further expand the global reach of our guide platform, including our X-ray technology.

Now let's move to the last row on slide 11, which covers our Industrial Production segment. As mentioned earlier, our European specialized sales teams have reached excellent accomplishments as they continue to successfully increase the sale of manufacturing as compared to prototyping services. The sales by our industrial production team become more and more complex, and involve, in many instances, the combination of printing, engineering, and software development services.

As an example, in June, we signed a collaboration agreement with Golden Laser to provide the backbone of Golden Laser's Web-based 3-D printing portal for China. Interestingly, our service offering to Golden Laser, which initially started as an i.materialise solutions only, has since then been expanding to include Streamics and other 3-D printing software products as well.

What are our plans for the third quarter in this segment? Well, we expect to further increase our end parts printing services and to further expand our i.materialise platform. In addition, we are also working to further grow our metal offering, moving from aluminum printing capacity into a wider range of metal materials.

In general, we are working on many other projects, some of them like the X-ray object we've covered in other calls. RFs are new and we'll discuss them in upcoming calls as they develop further.

As we come to the bottom of slide 11, I'd like to touch on our guidance for fiscal 2015. Based on the strong revenue growth we posted for the first half of the year and on our expanding opportunities for topline growth, combined with our plans to begin moderating spending increases both in sales and marketing and in R&D, we reiterate our full-year revenue and adjusted EBITDA outlook today.

Materialise has been contributing to the evolution of the additives manufacturing industry for many, many years now. And we have seen growth rates of both accelerate and slow down.

In young growth markets, small misalignments between capital expenditures and market demand may result in temporary positive or negative pickups in the growth rate. Regardless of the pace of growth of the market in general, Materialise has always carefully chosen its own lane and has consistently stayed on it.

Our lane on this very broad highway of additive manufacturing is the one of delivering both software and services to customers who are seeking to introduce 3-D printing in high-end industrial manufacturing and medical applications. While the later software and services is not entirely free of growth bumps, we do believe that it often offers more visibility and flexibility.

The strong performance of our sales teams across all three segments in the first half of 2015 forms the basis of our confidence that the customers and applications that rely on our software and services are there, and are there to stay for both the short and the long-term. It is up to us now to try and align our customers' short-term demands and long-term goals with both our short and long-term ambitions.

This will not be a walk in the park; never has been. But we believe that we are very well-placed to take up that challenge.

Now, before I open the call to questions, I'd like to take just another minute to introduce another person who understands and embraces the long-term potential of 3-D printing -- Johan Albrecht, who joined us in early July and who will be assuming the role of CFO later this week. Johan has more than 30 years of financial and international business experience, including 25 years as CFO of the Bark Group, where he was also a member of the company's Executive Committee.

Johan is a great addition to our team. And, of course, we all want to thank Frederic for his contributions. He did a stellar job in implementing the systems and procedures that we need to operate smoothly and well as a public company. We all enjoyed working with Frederic and wish him the very best going forward.

With that being said, operator, I would now like to ask you to open the call for questions.

(Operator Instructions) Troy Jensen, Piper.

Congrats on another solid quarter. Hey, so, Peter, for you, you touched on expanded relationships with Biomet and Zimmer. Do you feel like now we could see those two customers growing on an absolute basis? Or is it still they are exposed to this segment that is pretty saturated?

Troy, what we are doing now is, shortly after the closing of the merger end of June, is engage in discussions with the team that is in charge of the knee guide program within the newly-formed Biomet Zimmer group. Those discussions are ongoing. And it is really too early to anticipate on the outcome of these discussions or to start second-guessing what the outcome would be.

And all I can say today is that we have been waiting for quite some time to be able to engage in those discussions. We could not do so legally as long as the merger was not consummated. Those discussions are now ongoing. And we hope to be reporting on the outcome of these discussions in the coming months or quarters.

Okay. Understood. And sticking with medical here, what's the next milestone for the X-ray product?

As we -- and I will then pass the floor to Fried -- but as we explained in earlier calls, so the 510(k) has been introduced with the FDA. And we are basically now waiting for feedback from the authorities to then bring that process to a close.

I can only add that the clinical rollout is happening without any adverse indications. At this very moment, we are in this matter also, like Peter indicated, depending on the FDA. And as it is a very innovative product, yes, we are looking forward for the questions and trying to answer them.

All right. Understood. My final question here. Maybe congratulations goes to Bart for the industrial success here. But I understand the focus has been on end parts, but it seems like every service bureau is focused on end parts. So how have you guys been able to do so well growing your service barrel faster than the industry?

I'm taking the floor but actually I'm taking the credit of Fried here. I mean, this is the result of building a company over 25 years. And building the Company, we, as you know, did not just focus on the core competence of 3-D printing. We added the core competencies of engineering, process engineering, as well as software development.

And when you seek to print more than just a prototype but an actual end parts, then you need more than just a 3-D printer. You need a process engineer that will stand by your side and watch over the process. And you need software that will capture that experience, and that your customer will eventually be able to take home, if and when he decides to take that 3-D printing in-house. So I think we are viewed as a very reliable partner, but to kick off 3-D printing of end parts together with the OEMs out there, both in the industrial and in the medical markets.

Understood, gentlemen. Good luck in the second half.

Thank you.

Ben Hearnsberger, Stephens.

Thanks for taking my question. I wanted to ask about the expectation around operating expenses in 3Q and 4Q. It looks like guidance implies that operating expenses will be down on an absolute basis. Is this the right way to look at it?

Ben, what's -- it's good that you ask for clarification. What we actually said is that it is our ambition that operating expenses will, in absolute terms, grow at a slower pace than our revenues. And when we indicated that we believe that these operating expenses have reached a peak, we added that we believe they have reached a peak when expressed as a percentage of our revenues. So, going forward, the spread between our operating expenses and revenues -- the latter is growing quicker -- should broaden.

Got it. Okay. Thanks for the --

Hence our comfort to maintain our guidance.

Okay. Thanks for clarifying that. As we -- I know it's early, but as we look out on 2016, can you give us a sense for how much leverage you have? Or maybe give us a sense for the spread?

Hey, Ben, can I say nice try?

(laughter)

I mean, we intend to give -- I mean, to give guidance for 2016 towards the end of our Q4 conference call.

Okay, okay. Well, maybe another question around 2016 but maybe not asking more so around specifics. But we've seen kind of an air pocket in system sales. And obviously, software sales lagged system sales. Would the expectation be that we see a similar air pocket in your software business? Or do you expect the recent sales hires to kind of combat this or offset this?

Well, when there is truly a longer-term decline in system sales all through the market, then we cannot deny that we will suffer from it. But -- yes. The -- overall, we still see a growing amount of opportunities with the many different printer manufacturers that are in the market and that are still appearing in the market.

Ben, our software contributes significantly in metal printing, as you know. And as you also know, most of these metal printer manufacturers are not publicly listed. So it is more difficult to get insights in what their growth rates are. Except, of course, if indirectly, you look at our -- the good performance of our software segment.

Okay, that's helpful. And then I've got one last question on the growth businesses in the Industrial Production segment. And I'm sorry if I missed this, but can you tell us how much those businesses grew in the quarter? And whether the expectation is you get those to breakeven on an EBITDA margin basis -- or EBITDA basis by year-end?

In the aggregate -- I'm Frederic -- and correct me if I'm wrong, the growth was 40% of the two growing businesses quarter-over-quarter. The -- when will these businesses reach their breakeven point, Ben, is a good and valid question. Frankly, it is difficult to put an exact date on that. And I will briefly explain why.

Because those two businesses kind of have their own dynamic. We had a good assessment of where i.materialise was going, but then I think, very rightfully, decided to add a strategic layer to that growth business by franchising out the platform. So actually that brings a new dynamic in that growth business.

On the other hand, there is RapidFit. It's actually where we actually are having very good traction and very good results in the sales, and where a lot will depend on our ambition as to when and how we want to further roll out the successful sales that we have now.

Okay. That's helpful. Thank you, gentlemen.

Bobby Burleson, Canaccord.

Thanks for taking my question. So, congratulations on the strong organic growth. I think probably a couple of different things, referring back to software and that disconnect between what we're seeing for machine sales from some of the big guys here in the US, and the strong year-over-year growth you are seeing.

I'm wondering when we look at the metal build processor part of that revenue stream, do you guys have a more significant revenue opportunity in that category, let's say, on a machine-by-machine basis? Or a particular program with customers, given the greater potential complexity with critical metal parts?

The deals around build processors have different natures depending on the added value they bring to a certain machine manufacturer. So it's very difficult to give a unified answer on this. But I think our results show that they really tightened up the relationships that we have with the OEMs, and that they truly link Materialise to, in a more structural way, to the different machine manufacturers. And we expect this to increase even further if we can move to the AMCP platform that really is a part of the machine. So, the impact is one of stabilization of our revenue streams for the future.

Great. And then a follow-on to that, wondering, in the past, your use of your Mammoth machines and other internal production needs, drove and kind of, I think, fostered your development of your software for yourselves in order to optimize what you were renewing with your service bureau. And I'm wondering with metals, it doesn't seem like you have the same leadership in terms of other service bureaus that might be out there already running metal machines.

I'm wondering what it is you are doing with your OEMs and their customers in order to make sure that you are intimately involved in that process of optimizing the software? And wondering how comfortable they are at giving you access to the types of designs and challenges that they are faced with?

Well, it's true that we have not been investing in metal machines before the IPOs. But on the other hand, we have been involved with a variety of research institutes that have metal machines already for many, many years.

And actually, in the very early phase of the metal printing industry, one of the challenges for us was that there was such a wide variety of different systems being developed at so many different places, that made us decide that in that context, having just a few machines from one or two of the many manufacturers would not give us the same insight as collaborating with many different research institutes, and having interactions in our software development at many different places.

Now that a metal part is a bit maturing, we have decided that it was time for us to step into this industry. And the advantage that we have at this moment as we have grown ourselves as a company that we can do this at a larger scale for quite a variety of different machines and of different applications, which is truly Texas experience now even to a deeper level in-house.

So that is the history of our decision-making process. But, I dare to say that we have a very strong background for many years, and we will be making probably more announcements later this quarter on this topic.

Okay, great. And then just lastly, Lima is an important European manufacturer of hip implant systems. And I'm wondering how broad this relationship that's starting with the surgical guides could get, in terms of you actually making some of their hip cups, et cetera?

Lima is definitely -- I fully agree, Bobby, it's definitely a partner with further potential such as our actually older partners that we are talking to or that we have already signed deals with recently. And so when I hinted during my prepared remarks that our clinical team is very enthusiastically talking to new and existing relationships, it is definitely part of our strategy to try and expand the scope of our existing collaborations or of our rather new collaborations.

The way we got involved with Lima is they purchased the partial knee implant business from Biomet Zimmer, which Zimmer was forced to divest that as part of the Biomet merger. And they immediately decided that they could not just buy this business without actually joining the knee guide platform that has supported this business so successfully, when it was still owned by Zimmer.

And so that is how we got involved with Lima. I must say the relationship is excellent, and yes, we definitely have the ambition to further expand that relationship where possible.

Okay, great. Thank you.

Julian Mitchell, Credit Suisse.

This is Brian Gibbons in for Julian today. I was just wondering if we could get a quick update on the timing of some of the rollout of these -- of the metals in the industrial segment. And possibly kind of just following up maybe how that might be offsetting some of the costs that, in these rapid growth businesses, to get EBITDA back to positive. Thanks.

Like I indicated in the presentation, for instance, our own products are now all manufactured in-house. And they are now rolling out, which will have a positive impact on EBITDA. In the context of -- yes, customers that we are signing contracts with regulatory approved markets like the medical and aerospace industry. After signing the contract, it still takes half a year, up to a year before all the regulatory requirements are being met and before the product can really go to the market.

So this is indeed one of the reasons why our EBITDA level will increase gradually and not jump to a much better level. Because while we have already some lines that are generating better margins, we will have to keep investing with the new contract we signed in startup costs. So, this will explain that Materialise's top and bottom line both will evolve positively but gradually over the following years.

Great, thanks a lot. That's very helpful.

(Operator Instructions)

If we have no further questions, operator?

There are no further questions in queue at this time. I'll turn the call back over to Peter for closing remarks.

Excellent. Thank you. The weather is very nice here, so I mean, the sooner we can close the call, the better. Thank you all for joining.

I hope we have given you a good overview of the way the 3-D manufacturing sector is progressing in general, and the key role that Materialise is playing, and intends to continue to play, in advancing the development of that market.

Johan and myself will be in New York in early September for a financial conference, and I hope some of you will have a chance to meet Johan there. Materialise will be represented at both EUROMOLD in September and formnext in November. So we look forward to catching up with many of you in person at the latest in the fall.

Thank you again for your time, and good bye for now.

Thank you.

Thanks.

Thank you. Ladies and gentlemen, this concludes today's conference. You may now disconnect. Good day.