Ladies and gentlemen, welcome to the Oerlikon Q2 H1 2023 Results Conference Call and Live Webcast. I am Oira, the conference call operator. I would like to remind you that all participants will be in listen-only mode, and the conference is being recorded. The presentation will be followed by a Q&A session. You can register for questions at any time by pressing star and one on your telephone. For operator assistance, please press star and zero. The conference must not be recorded for publication or broadcast. At this time, it's my pleasure to hand over to Stephan Gick, Head of Investor Relations. Please go ahead, sir. Good morning, ladies and gentlemen, and welcome to Oerlikon's Q2 Results Call. With me in the call, I have Philipp Müller, CFO of Oerlikon. Philipp will start the call with a presentation, providing an update on our end markets, financials, and guidance. We will follow up with Q&A. With that, I would like to open our presentation and hand over to Philipp. The floor is yours. Thank you, Stephan. Good morning, everyone, welcome to our Second Quarter Results Presentation. In Q2, we continued to execute on our strategic objectives and successfully drove forward the integration of Riri. This happened in an environment which became increasingly difficult. Western industrial production lost traction, and the Chinese economy had a slow post-COVID recovery. In parallel, inflation was persistent and the Swiss franc strengthened significantly against all our major currencies. I will start the presentation with an overview of the group results, followed by an update on our end markets, the divisional results, and we'll conclude with our outlook. At the group level, orders were CHF 657 million. Polymer Processing Solutions customers continued to delay their investment decisions. In Surface Solutions, orders were up 9% organic, with a book-to-bill ratio above one. We highlight the quite dramatic movements in FX here on the slide, driven by the strengthening Swiss franc. This has a significant adverse impact on our top line and to an extent, also our markets. Group sales increased 4% in constant FX to CHF 702 million. This includes a 6% contribution from our acquisition of Riri. In Surface Solutions, the FX-adjusted organic sales increase was 8% and a strong 10% in the first half of the year. This was offset by Polymer Processing Solutions. Operational EBITDA was CHF 111 million, with an EBITDA margin at 15.8%. Profitability was impacted by the strength in Swiss franc, product mix and higher input costs. Furthermore, Surface Solutions had a slower than expected recovery in China, where we sell a higher margin product portfolio. We remain very confident in our actions to drive profitability in the coming quarters. Price increases and cost actions will take some time to be fully visible in the margin, but we're executing a clear set of actions in our Surface Solutions business. With that, let me provide you an update on our end markets. In Polymer Processing Solutions, customers continue to delay investment decisions, which is reflected in our order intake. On the filament side, Chinese customers have experienced a difficult macro environment in the past year. They were exposed to higher input costs, logistics challenges, tighter financing, and to softer domestic consumer demand. In the first half of 2023, specifically, our customers were hampered by high stockpiles in the textile industry. Moreover, textile consumers are being selective as the increased cost of living has put pressure on their discretionary spending budgets. As a result, we see Chinese filament customers postponing their CapEx decisions and preserving cash until they have more visibility. This started in the second half of last year, and to date, we have not yet seen a meaningful recovery. Especially during this time, we continue to drive innovation that will extend our technology leadership. Efficient new machines will bring forward investment decisions as our customers look to stay competitive and need to save energy. Improving financing conditions in China and increased consumer demand will also drive investment decisions. We expect an order recovery to happen in 2024. In our non-filament business, we saw stable sales at constant currencies in the second quarter. This was supported by industrial yarns, staple fibers, and our flow control business. Oerlikon has a leading technology in hot runners and benefits from new electric vehicle models. Technology leadership is being leveraged into adjacent non-automotive markets, such as durable goods. The nonwoven and carpet yarns businesses are seeing some customers delay investment decisions. Typically, orders are smaller, with lower financing needs and return faster when consumer demand picks back up. In the Surface Solutions division, we are operating across the tooling, automotive, luxury, aviation, and general industries and markets. We saw a higher share of materials and equipment sales to services. In the first half, our material sales increased 10%, while tooling services were down 5%. Services have, particularly in the general and tooling industries, a close correlation to industrial production. As such, we were impacted by Western PMIs, which remained in contraction and lost momentum throughout the first half of the year. In addition, the Chinese economy remained on a weak footing, with a slower than expected post-COVID recovery. In automotive, there are mixed signals from our customers. The second quarter was still partially impacted by a lag between carmakers production and reordering stock. Industry forecasts expect mid-single-digit light vehicle production growth for 2023. This is mainly driven by North America and Europe. APAC, where Oerlikon has its largest automotive exposure, is forecasted to grow below average. Oerlikon has made significant commercial progress with e-mobility solutions in the first half of the year, particularly in battery shielding. In luxury, we had a strong start to the year and saw a limited destocking in our customers in March and April. Demand picked up again strongly since May. Leading indicators like Swiss watch exports or tax-free shopping underscore the positive momentum in luxury. This provides an exciting growth environment for Kerdor and our newly consolidated Riri acquisition. Finally, in aviation, we see continued volume growth as rising flying hours are driving MRO activity. The China reopening and return to long-haul travel is a key factor as the industry returns towards 2019 flying hours. Oerlikon's leading technologies will support more efficient and more sustainable planes. Summing up, the difficult market environment for Polymer Processing Solutions will impact 2023 and 2024 sales. We've taken proactive measures to preserve profitability and emerge even stronger. In Surface Solutions, we expect growth in luxury and aviation. This may be partially offset by softening industrial activity. Now let's move to page four with the financials for our Surface Solutions division. Orders improved 9% organically to CHF 395 million. Despite the softening industrial activity, we achieved a slight order uptick quarter-over-quarter, leading to a book-to-bill above one. In terms of sales, we achieved 8% organic growth in the Q2 and a strong 10% in the first half of the year. Growth was supported by the aviation, energy, and luxury end markets. We also saw solid equipment and material sales within general industries. Operational EBITDA in the quarter was stable at 63 million Swiss francs. EBITDA margin was 16.1%. The business was impacted by`` the strengthened Swiss franc, higher input costs, and negative sales mix effects from increased demand for equipment and materials. In addition, the slower-than-expected recovery in China had an impact on margins as we sell a high-margin product portfolio in China, specifically. Cost actions initiated in the Q4 of 2022 will support margins in the second half as they continue to phase in. We also took pricing actions in January and in June. Expect to see positive impacts from that going forward. As I said earlier, we remain very confident in our actions to drive profitability in the coming quarters. The actions we are taking and some normalization of activity in our service businesses will allow us to bring the Surface Solutions business back to strong margins. Next, on Polymer Processing Solutions. Orders in Polymer Processing Solutions were CHF 263 million. This is down 33% in local currency, as customers are postponing filament orders. Sales of CHF 310 million were down 12% in constant FX. While we still benefited from last year's strong filament order intake, we saw impacts from the Turkey earthquake in Q2. As indicated in the beginning of the year, the event in Turkey is leading to seasonal delays throughout 2023. We saw some postponements from Q2 into the second half of the year. Non-filament sales were stable year-over-year. Operational EBITDA was CHF 44 million. Margins came in at 14.2%, impacted by sales mix, higher input costs, and the strength in Swiss franc. Cost measures booked in 2022 will support margins as lower sales volumes phase in during the second half. Let me give you an update on cash flow and ROCE. First half cash flow from operating activities was negative CHF 79 million. As indicated at the beginning of the year, the net working capital impact was stronger than in other years, mainly due to the reduction in customer advance payments in our Polymer Processing Solutions business. Compared to a year ago, customer advances have reduced by over 50% to CHF 230 million. We expect some further drag in the second half of the year, however, much less than what we have seen in the first half. The other components of net working capital are expected to be a solid source of cash in the second half of the year. We are managing net working capital with a lot of focus and expect operating free cash flow to improve in the second half, as net working capital seasonality reverses and headwinds and customer advances are beginning to soften. Next, on return on capital employed. Reported ROCE of 3.7% was impacted by the restructuring provisions booked in Q4 last year. Operational ROCE came in at 8.3% when we look at the organic operational performance of the company. This represents a slight decrease compared to last year, which is mainly related to the transitory reduction in customer advance payments. We continue to target a sustainable double-digit ROCE in the midterm, supported by the market recovery, continued cost containment, and disciplined execution on our new capital allocation framework. Let's move on to our full year guidance update on the next slide. As you know, our initial 2023 guide was based on the assumption of constant currencies. Given that we're now at midyear and the quite dramatic shifts we have seen versus the Swiss franc, we are updating this assumption with actuals. We expect the strengthened Swiss franc to lead to an adverse FX impact of around CHF 180 million year-over-year. As a result, we adjust our sales guidance to CHF 2.75 billion-CHF 2.8 billion. This includes a contribution of CHF 135 million from Riri, which we consolidate as per March. Our organic sales growth guidance remains unchanged compared to the beginning of the year. While Surface Solutions will perform better than originally assumed, we're expecting this to be compensated by slightly lower sales in Polymer Processing Solutions. In terms of EBITDA, we foresee a group margin of around 15.5%. FX has a negative impact on our margins. While our production currencies have a relatively good match with our FX exposure, the match is not perfect. As a Swiss HQ company, our cost base has a stronger exposure to the Swiss franc than our sales, for instance, due to overhead and R&D expenses. In addition, we are seeing some transitory impacts from mix and inflation. With that, let's conclude our presentation on the next two pages. During the first half, we made progress on the execution of our mid-term strategy, while at the same time, we proactively addressed short-term macro headwinds. Despite contracting PMIs, Surface Solutions achieved 10% organic sales growth in the first half. We saw transitory headwinds in the division's margin, and we'll address them with pricing and cost measures in the second half. The division Polymer Processing Solutions is executing in a challenging environment. We communicated on the challenging demand environment already last year, and we're proactively preparing our cost base. The underlying macro trend of growth in filament is unchanged and makes us very confident that this downturn is only transitory in nature. We have managed down cycles in this business before. We know that downturns can be relatively sharp, but so can the recovery. I want to remind you that the division realized 54% sales growth in 2017, after the down year of 2016. For us, we will continue to deliver on our innovation pipeline, and we have the flexibility to ramp up quickly when filament demand returns. Last but not least, on the group financing structure. As many of you know, we successfully placed two series of senior unsecured bonds in the second quarter. CHF 220 million are due in 2026, and CHF 120 million are due in 2029. These bonds are to repay outstanding debt and ensure continued strong financial foundation following the acquisition of Riri. On our midterm outlook. We continued to execute our midterm growth strategy in both our divisions in the first half. Surface Solutions drove geographic expansion and achieved 13% FX-adjusted growth, for example, in the Americas. The division continues to leverage its core competencies into new areas, such as battery shielding, and e-mobility. Another diversification represents the acquisition of Riri, which strengthens our foothold and leadership in luxury. While we currently see transitory cost and mixed headwinds, we remain committed to our midterm profitability targets for the division. Our recent exit from inline EPD supported us in managing to port, the portfolio towards higher margins. We are monitoring for further cost opportunities, will improve the product portfolio going forward. In Polymer Processing Solutions, the midterm demand will be driven by rising GDP and limited to no alternative resources to man-made fibers. The filament equipment market has been growing with a 4% CAGR in the last 20 years. These midterm growth drivers remain intact. It is a niche market with high technology barriers and long-standing customer relationships. As you know, the business is very cash generative and provides a solid base to expand its technology into new non-filament markets. As such, the non-filament business was stable in the first half, supported by new e-mobility car models and the extension of our end markets. We will further expand the division into the new non-filament markets. Overall, we've made solid progress on our strategy execution in the first half. Our updated sales guidance implies a 6% organic sales car CAGR since 2020, and we reiterate our midterm guidance of 4%-6% profitable sales growth. With that, let me open it up for a Q&A. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchtone telephone. You will hear a tone to confirm that you've entered the queue. If you wish to remove yourself from the question queue, you may press star and two. Questioners on the phone are requested to use only handsets and eventually turn off the volume from the webcast. Anyone who has a question may press star and one at this time. The first question is from Sebastian Kuenne from RBC. Please go ahead. Yeah. Hi, gentlemen. Two areas of questions. One is currency, and one is the capacity adjustments in OPP. For the currency, you, you, you highlight the weakness of the Chinese yuan. I was wondering if the price hikes you have for Surface Solutions are fully offsetting those drops in currency. Then similar for polymer, you have existing contracts. Are those hedged for the duration of the contract and for the duration of the order? For new contracts, can you adjust prices to offset the weak currency? That would be the current question. Yeah, Sebastian, thank you. Good morning. I think you're exactly right. Obviously, the typically, what happens is that the higher inflation that we see in some of those end markets, and thereby the currency devaluation, leads to quite a bit of pricing power for us. And that's the strategy. I think what you see in a year, like the current year, when the FX movements are so abrupt and so significant, is that there's just a timing delay. I think specifically on Surface Solutions, you're absolutely right. The innovation and really our, our, our footprint here allow us to drive pricing in those highly inflationary markets. It just takes a little bit of time. Mm-hmm. In polymer? In Polymer Processing Solutions, you know, the negotiations are maybe even a little bit more, you know, value based. I would say, as we're executing through the remaining backlog, you know, and we're negotiating and talking about new projects with customers, the whole, you know, our adjusted cost base with our suppliers plays a role. I think the technology innovation that we bring in the, in this next generation of, of, you know, really filament technology plays a big role. I think kind of readjustment, it's less of a rollover and less of a pricing. It's more an individual projects that we're negotiating on, on a value basis. There, I always assume that we have pretty good control over our price cost equation. Given that you produce mainly in Europe, and you sell mainly in China for polymer processing, and the Chinese currency dropped by 11% year-to-date, you think this can be offset or partly offset going forward? I think, I think in the medium term, you need, you need to do two things. One is, obviously, you need to continue to work on your own productivity, and, and, try to offset to a large extent. The other thing is, and we've communicated that, is that obviously you need to shift, continue to shift your supply base, both in-house and externally, closer to where the end markets are, right? I think, I think this over the medium term, that's a clear move. Remember, though, the biggest move that we've seen over the past couple of years is really the strengthening of the Swiss franc. The euro has actually not been strengthening that significantly. This year, we've seen a devaluation of the Chinese yuan, but it's really the first year, and we're going to react to that by, by making sure that our supply chain is in the right spot. Really, the biggest shift that we've seen is from a Swiss franc standpoint, the strengthening of the Swiss franc, and that's not where our supply chain base is for Polymer Processing Solutions. Yeah, understood. Capacity adjustments at Polymer Processing Solutions, can you give us an update what the situation is there? Thank you. Yeah, I would say we're, I would say we're on track. You know, there's always some puts and takes, but, you know, obviously a very difficult topic with what we've provided for in the fourth quarter of last year. We feel like that is adequate to make all the adjustments that we need to, from an overall, you know, capacity adjustment standpoint and our volume outlook for the next year, we, we feel like we're in line with that, so no additions needed. Basically on track. I would say difficult discussions, as you would expect, but we're driving it forward and, and, and, we're pretty much on track. The provisions cover it? The provisions cover it. Yes, that, that's right. Thank you. you. Thank you. The next question is from Michael Foeth, from Vontobel. Please go ahead. Yes. Hi, good morning, everyone. Two questions. The first one on, on, on the filament business in China, just to understand the sort of timing of the recovery. I mean, I get, I guess you know, the projects that your customers out there have, and the question really is, what indications do you have from the customers as what they expect for the first half of next year? Are they really waiting until the last moment to, to pull the trigger and come back with the- with their orders? Just to understand how, how, how the dynamics there work. Then the second question is on the, the acquired Riri business. If you can help us to understand the underlying organic development of Riri, and also where you stand in terms of integration there of that business into, into Oerlikon and potential synergies? Yep. Great. Good morning, Michael. The first one is, really a, a critical question. The first thing I would say is, all of our big clients in, in, in China, are. Their roadmap of growth and continued investment is basically unchanged. In terms of which projects, both from a technology and from a capacity standpoint, they are targeting next. You know that underneath that big umbrella of filament, there's quite a few nuances of products that our customers specialize on. That's basically unchanged. The timing is what has changed. I would say we are in constant dialogue with our clients about these projects, so there's, there's no change in direction from that standpoint. The timing is the critical question, and here, I would say, you know, what you first, what you need to see is that the capacity at our customers returns to the normalized level that it was at before Chinese domestic consumption dropped sharply last year. So I think we're seeing that Chinese consumption coming back up, that basically depletes inventory, not only at our customers, but also at our customers, customers. Then, I think you see really production ramping back up, that normalizes the overall supply chain, that normalizes cash flow levels at our customers and, and, and that will lead to new investment decisions. We are expecting that somewhere, you know, towards the end of the year, maybe beginning of the of the next year. As we've mentioned a couple times, we are also working hard to bring next level generation technology into the market, somewhere around that same point in time, to facilitate really the next generation of investments in the industry. Your second question, Michael, on the, on the, on Riri, I would say from an integration standpoint, solidly on track. Both Riri into Oerlikon, but also Riri together with Kerdor in the luxury platform. We feel very good about, you know, combining those two businesses, the great customer acceptance that we're seeing. You know, deploying PVD in that market is exactly what the industry wants and needs, so we feel very good about that, and the growth trajectory is unchanged from what we, what we described. We, we, see the industry growing somewhere high single, mid to high single digits. We think we can outgrow that by, by, you know, creating sales synergies between the two platforms, and so, that's unchanged. In March and April, we probably saw some destocking at large customers, and that has, has reversed again in May and June. We're back on that trajectory and feel really good about the, the outlook for the second half and the total year, and also going forward. Great. Thank you. The next question is from Alessandro Foletti, from Octavian. Please go ahead. Yes, good morning, everybody. Thank you for taking my questions. Just one thing I might have missed from you, Philipp, in your introductory remark, did you say that foreign exchange is affecting your markets to some extent? Yeah. What did you mean by that? Thank you, Alessandro. I got a note on that, that, that was cut off a little bit. It, it's affecting margins, is what I said. I'm glad I have an opportunity to, to clarify that. It's... You know, we, we always talk about, Alessandro, the fact that we have a pretty good natural hedge, because we have local costs and local sales. Also, from margin protection standpoint, that works well. However, as a Swiss-domiciled company, there is obviously some R&D and, and sort of G&A expenses that are in Swiss francs, that are difficult to adjust. When you have currency movements like, like this one, you know, that's a, that's a pretty significant Swiss franc cost base that basically remains stable as revenues shrink because of FX. We're estimating for the current year, that's a drag of about 40 basis points. It's a, it's a, a pretty significant factor. Back to Sebastian's question at the beginning, over time, we're expecting we're gonna be able to offset that with incremental pricing in those higher inflationary markets, but it takes a little bit of time. All right, great. Thank you. I was really a little bit confused by that. Now it's clear. Yeah, I'm glad you're clear. My, my real question is, another coming one. First of all, on flow control, I was kind of surprised to see that you gave it as flat. Why is that? Is it because of automotive? And does it also mean that it is flat for you? No, A-Alessandro, flow control is actually not flat. Flow control is up in glass, but other parts of non-filament, specifically on the nonwoven area, are down a little bit. Those two offset, and so the total is flat. Flow control continues to have a very strong year. 2021 exceeded our expectations, 2022 exceeded our expectations, and we're expecting that this year is also slightly above what we expected at the beginning of the year. All right. All right. Great for that. Then, another one on the cost measure. Did you say that you're gonna have additional cost measure in Surface Solutions? Yes, we will take certain additional cost measures in Surface Solutions, and I would just say, because of the sudden move in foreign exchange, it just accelerates some of the moves that we wanted to do anyway. Sort of continuing the regionalization, really adjusting what we look at from a central cost footprint, in line with the Swiss franc movement and so on. I think those are just things that we're gonna accelerate a little bit more. For sure, until we have adjusted our pricing to those other market dynamics, we will also take a pretty tough stance on discretionary spend. All right. Great. Thank you. I have another two questions, if possible. Again, you made a comment about Surface Solutions. Actually, you made two comments about the margin in Surface Solutions. First, you said, "Back to strong margin," that you expect it to be back to strong margin. Also, you said that you are committed to the midterm guidance, which is around 18%-19%, maybe, if I remember correctly. Do, do the two statements mean the same? Or when you said, "Back to strong margin," you actually had a qualitatively different number in your mind? No, unchanged. Alessandro, the, the expectation is unchanged for our mid-term margins, of, around 20%, 20%, even, even higher. You know, as, as we, as we really, you know, high grade the business and, keep the cost control in check. I'm really also expecting that the mix impact here, maybe only to an extent in the second half, but as it plays out, we'll fully normalize our, our high margin China business will come back, and that'll be a boost to margins. But for that, you need the China business, and then you need sort of... Is there anything like a normal mix? Because the mix will always be there. Mix- You will have a quarter where the mix is favorable and a quarter where the mix is not favorable. Obviously, they kind of have a big effect, I mean, much more than I thought, honestly. Yeah, I think you're right. I think, what you see here in the first half with materials being up, as you know, that's, not all parts of materials are accretive, and tooling being down significantly year-on-year, driven by China, that's sort of a- that's a little bit of perfect storm. I think specifically in China, the industrial production levels will normalize. So we're not-- we don't, you know, our mid-term margin guidance is not based on an only China or a booming China business, but obviously, we need that as a contributor because it's for our tooling business and for our existing infrastructure there, the absorption is very critical. All right, thank you. My last question on free cash flow, basically. You made already all the comments, which I appreciate. Do you think that you will be able to sort of catch up and have, like, a solidly positive free cash flow as a whole for the full year? Yes. Let me, let me walk you through the details of, you know, net working capital. You saw net working capital in the first half was obviously a significant drag, really driven by customer advances and payables. When I go through this, inventory was basically flat in the first half, receivables were slightly down, and then customer advances and payables are down significantly. Now, that's driven by Polymer Processing Solutions and the dynamics in filament. The first thing you did see depleting is basically the customer advances, shortly followed by our payables, because we're paying our, our suppliers. Now, what you're gonna see in the second half is that inventory becomes a strong source of cash, because now the inventory comes out of the system, and we're delivering to customers. Receivables, we're expecting to be a source of cash in the second half, and then the drag from customer advances and payables significantly less than it was in the first half. There's still gonna be a slight drag, but overall net working capital, we're expecting it to be positive in the second half of the year, with obviously substantial positive earnings. So, we're expecting free cash flow in the second half of the year to be very positive. All right. Thank you very much. That was all from my side, so. Thank you. Any further questions, please press star and one on your telephone. The next question is from Sebastian Vogel from UBS. Please go ahead. Good morning. I have three questions, I would ask them one by one. The first one is actually a follow-up to a previous question on filaments. Did I get that right that you said that you expect by the end of 2023 or the beginning of 2024, that's around the time when, when you expect orders to come back? That's, that's what I said. Sebastian, I would just say, you know, obviously, you've got to go through the logical sequence that I laid out, sort of with the normalization of the supply chain and the, and the demand environment, and so on. I obviously do not have, perfect visibility into our customers' investment decisions, but based on what we know right now, that's what we would expect. Got it. With at Surface Solutions, how much sort of pricing support you have seen in your organic top line growth in the second quarter? From the pricing actions that you have already introduced and that you have alluded to during the call, how much do you expect that one to support your organic sales growth and Surface Solutions in the second half year? Yeah, we said, in the first half of the year, we've probably seen around 3.5%-4% in terms of price. We're expecting that to be a little bit more, you know, as we see the spillover from the June price round in Surface Solutions. For the total year, maybe a little bit more than that. Got it. The last one is on the guidance, with regard to the EBITDA part of it. You mentioned a couple of factors, right? The FX, mix, cost, and so on. If you would try to allocate, the, the change in the guidance to these three factors, would all of them have sort of equally contributed to them, or would you expect that one of the factors have, bear the brunt of that, so to say, or how would you see the situation? You know, I think, Sebastian, I, I obviously try to allude a little bit here to the FX impact. We're assuming that to be around 40 basis points, that should, should be the large chunk of it. We obviously had a couple different things playing out in the, in the two divisions, but really these, the significant, additional effect from just the central cost that we have here, certainly plays a big role. That, you know, takes some time to adjust that. Got it. One very last one, if I may, sneak that one in. On the CapEx side, if I'm not mistaken, in the past, there was some sort of CHF 150 million alluded to for this year. Given your CapEx activity in the first half, do you still stick to that indication, or do you have other number in mind in the meantime? Yeah, I think we're, you know, we don't expect, other than a normal cadence in terms of our CapEx spend. I, I would say, specifically in Polymer Solutions, we are very, very selective in terms of where we make CapEx and decisions. Gonna be very slow there with incremental investments in the second half. In Surface Solutions, I think we're gonna follow the usual cadence that, that we have, in, in terms of CapEx. Got it. Many thanks. Great. Thank you, everybody. This concludes today's call. In case of further questions, don't hesitate to contact us in the IR team. Thank you for your attention today, and goodbye. Ladies and gentlemen, the conference is now over. Thank you for choosing Chorus Call, and thank you for participating in the conference. You may now disconnect your lines. Goodbye.