Xunlei Ltd (XNET) 2017 Q4 法說會逐字稿

Good morning, and thank you for standing by, and welcome to Xunlei's Fourth Quarter 2017 Earnings Conference Call. (Operator Instructions) Today's conference call is being recorded.

I would now like to hand the call over to your first host today, Ms. [Charlene Lu], IR Manager of Xunlei. Thank you. Please proceed.

Thank you, Calvin. Good morning, and good evening. Welcome to Xunlei's Fourth Quarter 2017 Earnings Call. I'm [Charlene Lu], Investor Relations Manager at Xunlei. With me today on the call are Mr. Lei Chen, our CEO; and Mr. Eric Zhou, our CFO. Today's conference call is being recorded, and a replay of the call will be available on our IR website following the call. Our earnings press release was distributed earlier today and is now also available on our IR website.

Before we get started, please note that the discussion today will contain certain forward-looking statements made under the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from our current expectations. Please refer to our SEC filings for more detailed descriptions of the risk factors that may affect our results. We do not assume any obligations to update any forward-looking statements, except as required under applicable laws.

During this call, we will refer to both GAAP and non-GAAP financial measures, and the non-GAAP measures are reconciled to comparable GAAP measures in the table attached to our earnings press release, which can also be found on our website. Please note that all numbers are in U.S. dollars, unless otherwise stated.

Okay. Now I will turn the call over to our CEO. Welcome, Mr. Lei.

Good morning, and good evening, everyone. Thanks for joining us today for our fourth quarter 2017 earnings conference call. I'm pleased to report that we ended 2017 with growth in revenues and net profits. This was the eighth quarter in which we achieved year-over-year quarterly revenue growth, and we met our upwardly revised revenue guidance of between $20 million and -- sorry, USD 80 million and USD 88 million for the fourth quarter of 2017. During the quarter, total revenues were USD 82.4 million, which represented approximately 128.5% and 83.9% increase on a year-over-year and a sequential basis, respectively. The growth was mainly driven by our cloud computing business. Cloud computing grew by approximately 517.2% on a year-over-year basis and 225.8% over the previous quarter. In addition, we also achieved good performance for our membership subscription business and enjoyed growth in online advertising and live video businesses as well. Historically, our membership subscription business provided us with significant cash flows to pursue growth opportunities.

Now I'd like to add some color to the performance of our major products, including cloud computing membership subscriptions and Xunlei mobility. In as early as 2015, we started to develop distributed cloud computing products as we saw significant growth opportunities with the emergence of IoT, AR, AI and big data, et cetera. We leveraged users' idle bandwidth and storage to offer cloud computing services to business. By this approach, we can help business to reduce cost and improve performance. Lately, we have seen the trend of similar and relevant technologies such as Edge Computing and Serverless PaaS sprouting out from different technology thinkers and evangelists. We believe this trend will continue for a couple of reasons. First, IoT becomes more important and starts to fundamentally change how we live and how we conduct business. This leads to a variety of applications where such technologies provide better solutions. And secondly, the demand for bandwidth, storage and computing power grow rapidly, while the cost of CPU, flash and other computing units reduce at a much slower pace. We even saw a reverse price trend in some of these units. A solution that can fundamentally reduce cost will become more and more desirable in this market.

To strengthen our lead in distributed cloud computing, in September 2017, we launched a new product, OneThing Cloud, which is a smart hardware device and serves as a personal private cloud that can be considered as a Google Drive at home. We believe the online personal cloud market which is often used to characterize the market for products similar to Google Drive in China is very big. According to [incomplete] statistics, China has more than 400 million personal cloud users. By offering a hardware that plays at your home that satisfy the same need, OneThing Cloud provides an added benefit of privacy, security and better user experience.

We introduced a voluntary incentive program based on OneThing Cloud. By enrolling into this program, users gave permission to us to use their idle bandwidth storage and CPU through OneThing Cloud. We believe OneThing Cloud not only helps meet the rapidly growing demand for computing resources, but reduces the need for building new IDC, and hence, saves energy and protects the environment.

We believe the introduction of OneThing Cloud and blockchain technology will improve our distributed cloud computing business. The device offers better hardware configuration than Xunlei Mine Crafter, which allows us to go beyond CDN domain and offers new types of services to our customers. Blockchain allows us to construct an automated, efficient and trustworthy reward mechanism. We also expect to develop and expand an open ecosystem. Xunlei and our partners will build more applications on our blockchain infrastructure.

Our effort around blockchain has received recognition at home and abroad. To mention a few, in December 2017, we were selected as an outstanding entity of the Chinese blockchain industry during an awards ceremony in Beijing. The sponsoring organization, China High-tech Industrialization Research Association and Blockchain Industry Alliance, together with China Association of Science and Technology (sic) [China Association for Science and Technology], the National Development and Reform Commission and the Ministry of Science and Technology, the Ministry of Industry and Information Technology of People's Republic of China, China High-tech Industrialization Association, China Electronics Standardization Institution -- Institutes and other related institutions presented awards to OneThing and other honorable firms. In general, 2018, our OneThing Cloud was recognized as a global top innovative product in blockchain technology by TMTPost for its annual CES Innovation Awards program in Las Vegas.

Now I'd like to move on to our subscriptions business. Revenues from our subscription business accounted for about 27.6% of our total revenues in the fourth quarter of 2017. The revenue were relatively stable, but the percentage of total revenue declined as our cloud computing business contributed more to the total revenues. As compared with the third quarter of 2017, we had an increase in the number of membership subscribers. We also had higher ARPU value as we offered a super VIP membership program and achieved better profit margin as we reduced IDC and bandwidth cost by utilizing resources collected from our cloud computing.

Let me now turn to our mobile products. Xunlei Mobile, our mobile app, allows users to search and download contents, distribute short videos and participate in live video programs. We're delighted to see revenue from our live video product rose by 34.4% in the fourth quarter as compared to the previous quarter, expanding the rapid growth that we have achieved in the third quarter. We believe live video has a large and competitive market and has significant growth potential. We expect to release a new product in the near future to maintain our growth momentum.

Finally, our efforts -- our efforts to build a short video and live video content ecosystem began to pay off for our advertising business. We had higher DAUs and better advertising pricing. As a result, our online advertising revenue grew 70.6% and 36% on a year-over-year and a sequential basis, respectively.

With that, I will now turn the call over to Eric to review the fourth quarter financial performance. Eric, please.

Thank you, Lei. Good morning, and good evening, everyone. And once again, welcome to Xunlei's Fourth Quarter Earnings Conference Call.

For the fourth quarter, total revenues were $82.4 million, which represented a 128.5% growth on a year-over-year basis and met our revised revenue guidance. Increases in cloud computing and live video business were the major contributors to the year-over-year growth. For our cloud computing business, revenues from cloud computing increased 225.8% on a sequential basis, primarily due to sales of our new intelligent hardware device, OneThing Cloud. Other IVAS revenues, excluding cloud computing revenues, also increased in the fourth quarter of 2017, primarily due to the increase in live video revenue and a one-time technology solutions service revenue of $5.8 million. Subscription revenues were $22.7 million. The number of subscribers increased from 4.18 million at the end of the third quarter to 4.25 million at the end of the fourth quarter. The ARPU value increased to RMB 34.4 in the fourth quarter from RMB 33.2 in the third quarter. We offered a super VIP membership program, and it was well received. We have seen increases in this enrollment lately and expect the trend to continue in the coming quarters.

Online advertising revenues, which included mobile advertising revenue in the fourth quarter were $7.8 million. Mobile advertising revenue grew 79.2% in the fourth quarter of 2017 compared to the corresponding period of last year. The gross margin (sic) [gross profit] in the fourth quarter were $39.7 million, grew 153% compared to the corresponding period of last year. The gross margin was 48.2% compared with 43.5% of the corresponding period of last year. We realized operating profit and net profit from continuing operations of $3.9 million and $3 million, respectively, in the fourth quarter compared with operating loss and a net loss from continuing operations of $31.8 million and $26.8 million, respectively, in the previous quarter. The improved performance was mainly due to increased cloud computing revenues as well as better performance of other major product lines.

Turning to our balance sheet. We continue to have a strong balance sheet. We ended the quarter with cash, cash equivalents and short-term investments of $372.4 million, which is up from $357.7 million at the end of the third quarter of 2017. Cash, cash equivalents and other short-term investments per ADS was approximately $5.60 at the end of fourth quarter of 2017.

Let me finish by going over our guidance for the first quarter of 2018. We expect total revenues to be between $81 million and $85 million for the first quarter of 2018. The midpoint of the range represents a year-over-year increase of about 129.3%.

With that, I conclude our prepared remarks today, and I will now turn the call over to the operator for your questions. Operator, please.

(Operator Instructions) And our first question comes from Leon Dean from Morgan Stanley.

I just have 2 questions. One is, over the medium to long term, how should we think about hardware revenue from cloud computing, i.e., OneThing Cloud? And second question is, how should we think about revenue associated with cloud beyond just hardware revenue?

Thank you, Leon. This is Lei. So hardware revenue -- in terms of hardware revenue, it is very -- the hardware business has a -- has its own -- sorry, let me -- let me first answer this in Chinese, okay, and then we'll continue with English answers. (foreign language) So let me try to rephrase that in English. Hardware business has its own growth pattern. In the beginning, when the market has very few deployed units, the growth rate is usually very high, but the growth rate will slow down when the market has become -- more and more hardware is delivered to the market. So we don't expect that hardware revenue to continue to grow at such a rapid pace. But we do expect our 2B business, the cloud service, start to rapidly grow based on our deployment units across the nation. So -- but also, for the 2B business, what we're doing is, we're expanding our -- the scope of our business and product lines. So I think when we address the market, we're more and more focused on the bottom line which is better profitability from our 2B business. The pricing -- because we have such an advantage, our strategy is to stress on our cost advantage, which will bring down the pricing of the overall market. So our focus is more on the bottom line instead of the top line.

Understood. If I may have a follow up just on the 2B business, given that it's based on the number of units deployed, and I think as of the latest, I think there's about 1.2 million units deployed. If -- please correct me if I'm wrong. And what type of capacity should we like expect from the current units deployed? And what type of units deployed should we -- how should we think about the number of units deployed, let's say, by the end of 2018 or by the end of 2019, what type of, sort of, size of capacity can we offer to our 2B business customers?

Thank you, Leon. This is Lei Chen again. We currently do not disclose the exact number of units that has been deployed. That said, we are -- we're apparently in a fast expanding phase of the capacity that we're collecting from the users at home. While -- let me say this. Let me say this. The current deployment quantity in China has allowed us to rapidly expand our cloud computing offering to our customers for a while. However, with more and more units deployed, both the service capacity and service quality will improve. We're not -- but we're not disclosing the exact capacity at this time.

Understood. And when should we expect servicing revenue to come through? Would it be like 6 months to 1 year? Is there like a rough time line that we could expect or hope to see?

Yes, so we currently generate significant service revenue already for the past 2 years. That has been growing at a pretty high rate as well. We're expecting the revenue and profitability to grow, but our focus is on the bottom line, more on the bottom line than the top line. As I said, our strength is in -- significantly reduce the cost of the industry. So we're going to leverage that cost advantage and to build a profitable cloud computing business.

And our next telephone question comes from [Ran Zhou] who's a private investor.

I guess, firstly, I just want to make a quick comment, I guess no offense and no hard feelings, but this rescheduling conference call, I hope, I kind of personally, I hope it won't happen again. Again, just that's a quick comment. Then the first question, I have a couple of questions. I'll ask one by one. The first one is a very quick one. Just on the -- I thought -- so you basically you have sell down your online game business. So essentially that's not in the revenue anymore, and I look at -- I just want to clarify and make sure that's the right understanding because you restate your revenue numbers in the prior quarter was $2 million, so that's because of this, right? So the online game is not in the revenue anymore and you restated that?

Well, thank you very much, [Ran]. And first of all, let me apologize, which we should probably have done in the beginning of the conference for rescheduling the conference call. At the last minute, we were doing our due diligence to make sure that our reports are -- so we needed a little bit time to work on our reports. I'm sure our financial team, we will be more diligent and this won't happen next time. So let me apologize on behalf of the financial team for the preparation of this -- for the release and the conference call. The question about the online game business, Eric, do you have comments on that?

You're correct. Most of the game business were discontinued and we still have a very, very small portion of the game revenue, but that amount is not significant right now.

I should basically understand the difference between the revenue that you put out today versus before is basically this online game business. Is that correct?

That's correct, yes.

Okay. Then the next question is on -- so I look at -- I noticed that your bandwidth cost has declined nicely this quarter. I just want to understand, that's due to your network, your online cloud being deployed so you -- essentially, you don't need to use some party bandwidth. Is that correct?

Yes, so as we said earlier, we -- our subscription business has leveraged the -- has reduced IDC and bandwidth cost by utilizing resources collected from our cloud computing business. So that's not only achieved better profit margin for our membership business, but also from a financial statement perspective, we did reduce our overall bandwidth cost.

And I assume because you have your own online video business, so I assume you also use your own OneCloud network to do the online video. So essentially, that's why you sometimes probably you don't need to book the revenue or the cost for your own online video. Is that the right way to think about?

Yes. Yes. So across our business line, we are adopting rapidly and our own cloud computing business, our own cloud computing technology, and as a result, it reduce costs across the board. But more significantly, our cost -- or let me say this. So live video product, the cost of live video product in terms of bandwidth compared to the subscription business, is still small, it's still relatively small. So even though there is -- the adoption of our own cloud computing technology helps, but not as significantly as the subscription business in the amounts, right.

Got you. And final question, kind of a little bit bigger topic, so I guess I appreciate your effort in terms of rolling out the equipment, this new blockchain-based LINK token. But I also -- I guess, I also appreciate the reason that you have to shut down or limit the third-party trading of LINK token. I guess my question here was, given -- well, we can still check the price of LINK token from several sources and the prices have come down for the last, kind of, over 1 month or so, and it has come down significantly. I wonder, do you kind of -- is that a concern that one, given the price has dropped significantly, the incentive for consumers to buy the equipment has kind of reduced so that will actually impact the deployment of your equipment. If that's a concern, how would you address that?

Thank you very much for the question, but you understand that there's a potential litigation in the U.S, so we're advised not to answer questions in this nature at this time.

The next telephone question comes from [Eric Sung] from [AING].

I have a few questions regarding the financials of the quarterly report, and the first one is really regarding whether we record -- like we are going to or we are planning to put the liability for LINK token. Because as a part of the rewarding program, our LINK token will be distributed to our users who contributed their bandwidth and also the storage. So the question would be, by the end of the quarter or by the end of this year, there will be a significant portion of the LINK token that you give to the users. And would that be part of the liability of Xunlei? Or it won't be?

First question is yes, we are recording it -- we're doing accounting treatment for LINK token. Right now, we are diverting the bandwidth costs, and at the same time, we created deferred revenues.

If we are recording as a liability, like at what price are we booking for the financial reporting purposes?

Basically, we assess these fair market value of the bandwidth we collect. And when doing so, we take into account a number of factors, such as the market price of various bandwidths and also the bandwidth usability and one thing called device availability and also allocation of the storage between the users and Xunlei, so we are basically considering a number of factors when we come to a value or the cost for the LINK token we rewarded.

Okay. And the second question is really regarding the attributes of the total revenue. And we know like from your financial report, other Internet value-added service would contribute like half, probably 50% of your revenue, and that component really contains pretty much everything related to hardware sales of OneThing Cloud and also sales of cloud computing services. So at what kind -- or to what extent that the component of these sales that will be split in the future? Because from the current financial earning, like we couldn't tell like how much was attributed to, for example, our cloud computing business and a quarter-over-quarter, how much increase we are looking at.

And you are correct. The IVAS consists of a number of revenue items and -- but the largest items are CDN and also the sales of the OneThing Cloud. And for competitive reasons, as you may understand, and for the time being, we are not breaking down the components of this revenue items, but we are studying this issue, and we may have more detailed segment reporting in the future.

Okay. Thank you for confirming that. Because that will really help on the financial analysis of the company. And the last question is really for CEO, Lei Chen. I think, first, thank you so much for bringing this business up and turning the business around. And my question was very general and I want to see in, like 1 or 2 sentence as a comment from you, to describe your vision of the company in the next 3 to 5 years.

Xunlei is -- in my view, Xunlei's future is tied to its ability of technology innovation. Xunlei's strength from the beginning is decentralized computing, and the way that we're doing distributed computing, distributed cloud computing, is extension to -- is built on top of the core strength of Xunlei as well as blockchain technology. I'd like to see -- yes.

And our next question comes from [Jack Wu], who is an independent investor. Jack Wu is not replying. [Gilbert Sung], please ask your question. As there's no response on [Gilbert], we'll go to [Kan Hu], who's a private investor.

This is [Kan]. Congratulations on the great revenue growth. And apparently you guys have been working very hard for the last couple of years and the results is outstanding. My first question is, what is your top 10 customer in CDN business?

I'm sorry. Thank you very much for the comment. But I'm sorry, I lost you on the question.

Yes, what is your top 10 customers in the CDN business?

Oh, so our top, top customers in the CDN customers?

Yes, top, top 5. Yes. Yes.

So the exact top 5 customers: Panda TV, is an online stream -- video streaming company; a live video streaming company, Xiaomi, [ITE, Billy-Billy] and -- which one is our...

(inaudible)

So yes, Kuaishou, I think is among the top 5. So I'm not looking at my (inaudible) for it right now, but to recall from my memory, these are the top 5 revenue generators.

Yes, how should we think about your CDN business growth? Apparently, you guided your revenue pretty much flat versus Q4 for the Q1 2018. And you all see the revenue continue to grow in the CDN business or the revenue is going to be flat because you're focusing on the profitability?

So the CDN business in China is very competitive at this point. I think that there were more than 80 license issued last year to CDN providers, which is a lot more than what we would expect a couple of years ago. So the pricing of CDN business has been driven down because of the competition, the heated competition. Our strength in this business is our cost structure. So we are, to a certain extent, benefiting from the downward pressure of the CDN pricing. However, it does drive down the revenue numbers as well because the same amount of services -- for the same of amount of services it delivers, the price is down we're charging less. So we are coming out with even better solutions with significantly lower pricing in the future, such that this line of product will give us even better profitability and bottom line. So as I said, our emphasis is going to be to strengthen our bottom line down the road rather than looking too much on the top line. So our focus is to expand our market share and to build a better bottom line.

Understood. But your CDN business, the top line will continue to grow or it's going to stay flat or it's going to go down? But I understand that your cost structure will be better with the new product, yes?

Yes. What I'm saying probably is this. Let me think how best to phrase it. Our strategy will be more aggressive down the road because we have built up our deployment units, which is our main -- where our strength lies, right? So we're going to leverage that strength to use more aggressive marketing strategy to perhaps even drive down the current pricing more. I expect our service will have better market share, but because the pricing will be driven down. It probably will -- it's hard to say how the -- so I wouldn't expect as fast as the revenue growth. So the pricing will be down. The revenue growth will apparently be affected by the pricing, but our focus is more and more on the market share and the bottom line.

That's great. I think my view is that you have a lot of potential to get more market share and getting better profitability, and you are extremely undervalued at this point. And my final question is a bit about your announcement today on the Xiaomi revenue. This is the one time of event. And is that -- with the Xiaomi, can you clarify the nature of the revenue recognition with the Xiaomi? And now going forward, you must be doing business with the Xiaomi. You just mentioned Xiaomi was actually in the top 5 of your CDN customer? Will the Xiaomi continue to be a CDN customer or they're not going in the next quarter?

Yes, so Xunlei assists Xiaomi to develop acceleration and file management technology that is embedded into the MIUI, Xiaomi's cellphone operating system. Xiaomi and Xunlei entered into an agreement in 2017 Q4 that Xunlei is entitled to receive a technical support income for services provided, and that what we received is the first time for that payment. We are -- what is the status of the continuing discussion?

Basically the revenue we represent in the fourth quarter in the earnings report were the revenue from the services we provide to Xiaomi before. I think in some of that, most of the revenues were in 2017, and it's more possible [come] in 2016. But we didn't recognize this revenue before because even though our service was provided, but we -- the final contract was not -- we didn't come to the final agreement to the -- in terms of certain pricing issues. So the contract was actually, was eventually just closed for this way. And once this contract was closed, then we, in terms of accounting rules, we booked the revenue. So the revenue was for the services we provided before. And right now, we are still talking to Xiaomi and trying to dispatch a new contract for the services for the future.

So we're continuing to provide this service apparently, of course, to Xiaomi. So we're negotiating the contract for the future revenue recognition and, hopefully, a long-term contract this time. And -- but as you can see, that collaboration between Xiaomi and Xunlei is strengthening. And Xiaomi -- first of all, Xiaomi is a leader in hardware development, and that will certainly help our costs. And Xiaomi is doing exceptionally well in some of the foreign markets that we're interested in, so we expect that when we expand into foreign market, our relationship with Xiaomi will certainly help.

If you take away the Xiaomi's revenue and look at your Q1 guidance, actually you will be flat or even grow a little bit over a very strong Q4 last year, right?

That's correct. Even without Xiaomi's revenue, our revenue still grew a lot, yes.

That's correct. And I just want to make sure that you mentioned that the Xiaomi is actually one of your top customers in the CDN business. That business is continuing, right?

Yes, yes and yes. So our relationship with Xiaomi is multifaceted. They are our investor, they are also our top customer as well, one of our top customers as well.

And our next question is from [Jack Wu], who's an independent investor.

This is [Jack Wu]. Yes, congratulations on the profitability. So speaking about profitability, I do have a question regarding the sales of OneCloud hardware. Was there any liability included in the sales of the hardware? Because you promised you'll provide lifetime downloading service to all those owners of the hardware.

And yes, we did book some costs associated with selling of the OneThing Cloud. So [Jack], the liability we're mentioning, you're referring to basically is the kind of liability in the future, how we are going to achieve this LINK tokens. And we -- right now, we are booking some of the costs associated with the LINK tokens. So Jack , a couple of minutes -- a few minutes ago, the same question was asked and there was a more extensive answer back then. And it's -- -- maybe if you're so kind, maybe review the scripts, the transcripts of the call, you will see a more extensive answer to your question.

Yes, yes. So there might be a misunderstanding about my question. The previous answer was related to LINK token liability. My question is actually related to the liability about OneThing Cloud hardware because you will provide the downloading service to those hardware owners. Is that correct? So I mean, sometimes we record those kind of liabilities as unearned a lot of revenue until those services are provided. So was there a fair market value of those services? Or you just ignored those kind of future services, it's downloading, yes?

And we are -- right now, what we're doing is based on the U.S. GAAPs or -- I think it might be the -- if you need to -- want to know more, maybe we can have in the future discussion, but right now basically what we're doing is based on the U.S. GAAPs.

Okay. All right. And speaking about the class action cases just -- Lei just mentioned, so I know you're not supposed to discuss in details policies, stuff like that, but my question is, is there any Chinese official government alleged or -- that Xunlei has ICO, illegal ICO operations? I mean, I'm asking the government agencies.

Well, so given that there's potential class action litigation, we're advised not to answer questions of this nature at this time.

Okay. And is (inaudible) still in charge of the legal department? Is she handling those cases?

No.

No. The next question has to do with international marketing and international sales. Is there any update you want -- help us to foresee the future, like what kind of market are you looking into? And what are the potential sales in different markets?

Yes. So the final question is about foreign markets, right?

Yes.

We are starting to -- we have started our sales of the OneThing Cloud in foreign markets and so -- so now let me give a fairly high-level answer to this question. Our overseas strategy is based on our existing technology and products. This including downloading and acceleration as well as our cloud computing technology. For our cloud computing business, we are pursuing partnership, especially with local carriers in the foreign markets. And I think that is one of the most important strategy for us, is to establish in partnership with local carriers. The countries participating in the Belt One Road (sic) [One Belt and One Road] initiative, of course, the highest -- have the highest priority for us.

Okay, so I live in the United States, and I'm thinking when will I be able to get a OneThing Cloud at my home?

We do have customers who bought OneThing Cloud and using them in the United States even though we haven't sell this product, I think -- from China. We can't guarantee the usability of this product. They brought this product on their own to U.S., but perhaps it's worth trying.

Okay. I just have one quick comment about the OneThing Cloud. As you were talking about, it might be slowing down the sales of OneThing Cloud, I actually have an idea of renting those equipment to the users or to the players, and they pay back with LINK token, whatever they get from using this equipment. I don't know whether -- you probably have explored many ideas, but that is something that have been in my mind, and I just want to make a comment on this.

Thank you very much, [Jack]. This is a new idea to us, and we value your input, and we'll certainly consider it with high regard.

There are no more further questions at this time. I'd like to hand the call back to the speakers for any continued remarks. Please continue.

Thanks again for your kind attention, and please feel free to contact us if you have any questions. And have a good day. Bye.

Ladies and gentlemen, that does conclude the call. You may disconnect. Goodbye.