Concentradora Fibra Hotelera Mexicana SA de CV

BMV:FIHO12

Earnings Call Transcript 2020-Q4

[Operator]

Good morning. My name is Doug, and I will be your conference operator today. At this time, I would like to welcome everyone to FibraHotel's 2020 Fourth Quarter and Year-End Earnings Conference Call.

FibraHotel issued its quarterly report on Wednesday. If you did not receive a copy via e-mail, you can find it at www.fibrahotel.com or e-mail [e-mail].

Before we begin the call today, I would like to remind you that forward-looking statements made during today's conference call do not account for future economic circumstances, industry conditions, company performance and financial results. Unless noted, all figures included herein were prepared in accordance with international financial reporting standards and are stated in nominal Mexican pesos.

Joining us from FibraHotel are Mr. Simón Galante, CEO; Mr. Eduardo López, General Manager; Mr. Edouard Boudrant, CFO; and Mr. Guillermo Bravo, CIO.

With that, I will turn the call over to Mr. Simón Galante. Please -- sir, please begin.

[Simón Zaga, executive]

Thank you, and good morning, everyone. I'm going to begin today's call by providing an overview of the fourth quarter of 2020 results, the current situation, and then we'll turn the call to Edouard Boudrant, our CFO, who will discuss our financial results in more detail. And then we will open the call for questions and answers.

I would like to start by briefly reflecting on 2020 that was marked by COVID-19 pandemic and presented unique circumstances and challenges to our business. We faced the deepest crisis the hospitality industry has experienced. FibraHotel has never closed a hotel, and we closed 84 hotels at the same time during a few months. Even under these conditions and thanks to active management and cost control in our hotels, the end result for FibraHotel were an AFFO loss of close to MXN 430 million in 2020.

To put this in perspective, this is less than 15% of the AFFO generated in the previous 5 years and less than 3% of the book value of our assets. It's not a good result, but I am very proud of the achievements in the items that we can directly impact such as cost control and our commitment to evolving and progress on ESG issues.

2020 also presented us with the opportunity to highlight the resiliency of our structure and portfolio. For the past few years, we have strategically diversified our portfolio into leisure and dollar-generating hotels. The power of our portfolio diversification has served us well as we serve both business and leisure travel in different segments, and our hotels are located in 26 states and have well-recognized brands and operators. We also intentionally structured the company to have low-leverage levels and with valuable 3 agreements with downside protection as we aim to manage the company across business cycles.

I would like to thank and recognize our teams and partners for their work through this difficult year. Our company would not be possible without the unwavering commitment from our team members, the guidance of our Technical Committee and the support of our strategic partners, like operators, banks and investors.

After these positive opening notes, please let me reiterate that we are still far from the full recovery, and we understand that there is still uncertainty on the recovery time line. We also continue to be impacted by health situation, including equipments' limitations as well as travel restrictions and debt requirements. We also understand that the industry has changed, and we need to continue innovating and evolve to become a better and stronger company.

We have already undertaken different initiatives to improve areas such as food and beverage offerings and technology in our hotels. We will also expand our services offering to target new trends such as work away from home, training and social gatherings, among others.

We continue slowly progressing towards a recovery of hotel industry in Mexico. During the quarter, our hotels showed a positive trend with an occupancy reaching 36% almost 12 percentage points above the previous quarter. Revenue increased 45% versus the last quarter but still was 52% below last year and far from pre-COVID levels.

I would like to highlight that the results from the Fiesta Americana Cancun hotel, which has an occupancy above 50%. And the Live Aqua San Miguel de Allende hotels, which has a better October than the previous year, especially on the bottom line. Both of these hotels are in line with a trend of tourism recovering faster than business hotels. We expect this trend to continue as vaccine accelerates and more people are able to more freely drop.

We also saw slow but positive signs of recovery in the business hotels. Even though they are still being impacted by restriction on travel, and rate is still lower than before due to a change in business mix.

We continued the focus on cost control on all of our hotels. These efforts allowed us to reach an EBITDA of almost MXN 60 million during the quarter and to be very close to breakeven at the company cash flow level. Both of these are very impressive achievements with an occupancy of 36%.

On the strategic front, we continue to evaluate different alternatives for the closed hotels such as the repositioning, the reopening or possible sale of the properties as conditions improve. We expect to have an update regarding the hotel in Playa del Carmen in the following weeks as we look to reopen the property under a different brand and operator looking to get additional exposure to international leisure travelers.

On the corporate level, and as I mentioned before, we continue to be in an uncertain environment regarding the speed and shape of the economic hotel recovery. And we continue with measures to conserve liquidity, such as reducing all nonessential expenditures, eliminating the distribution and deferring the payment of the advisory fee.

We expect to pay the advisory fee on normal basis going forward and the Practices Committee is evaluating different alternatives to pay the 2020 account payable. FibraHotel has a strong liquidity position with MXN 460 million in cash and available credit line of MXN 250 million and an LTV of 29%.

Additionally, we have reached agreements to reduce short-term capital amortization and extended covenant waivers with our bank lenders for 2021. The FIHO 19 Assembly also approved waivers that allowed us to refinance existing debt with better conditions to add new debt for up to MXN 500 million.

Finally, we continued discussions with Sabadell to extended MXN 200 million revolver, and we are able to extend it. We would only have MXN 120 million of capital amortization due in 2021.

Before I pass the call to Edouard, I would like to publicly send our deepest condolences on the passing of Arne Sorenson, a great man and Marriott's CEO. Arne was a true visionary leader in our industry and is loss for Mexico and an important part of the relationship we were able to develop with Marriott. We -- he will be truly missed in our heart and support goes to the family, friends and the entire Marriott team.

With that, I will now pass the call over to Edouard Boudrant, CFO of FibraHotel, to disclose the financial and operating results of the quarter.

[Edouard Boudrant, executive]

Thank you, Simón, and good morning, everyone. During the fourth quarter of 2020, our results substantially improved versus the third quarter. We closed the fourth quarter with 81 hotel opened. The occupancy rate of the quarter was 36% for managed hotels versus 24% during the third quarter. On a monthly basis, occupancy rate was 37% in October, 38% in November and 35% in December.

Average daily rate was MXN 1,076. Quarterly RevPAR was MXN 388 versus MXN 265 during the third quarter. The Fiesta Americana Condesa Cancun hotel had a net package ADR of MXN 4,074. Occupancy was 50.3%, and net package RevPAR was MXN 2,048. Total revenues for the quarter were MXN 545 million versus MXN 376 million for the third quarter, increasing 45%. Lodging contribution for the quarter was a positive MXN 134 million.

The initiative to adjust the structure of operating cost of our properties were strengthened during the quarter, targeting a much lower breakeven point compared with the level we had pre-crisis. After reaching operating breakeven during the month of August, with a 25% occupancy rate, we continue to closely monitor operating expenses during the fourth quarter. Between the third and fourth quarter, monthly, revenues of the managed hotels increased on average by 47%, while expense only decreased by 17%.

Our EBITDA for the quarter turned positive, reaching MXN 60 million versus MXN 20 million loss for the third quarter. Real estate expenses were MXN 23 million versus MXN 17 million during the third quarter, mainly impact with provisions for bad debt.

Regarding corporate expenses, we continued with the measures we presented during the past earnings calls to ensure cash savings and preserve the liquidity of FibraHotel, SG&A cost reductions, postponement of the payment of the advisory fee and limitation of CapEx. We closed the quarter with a net debt of MXN 4.5 billion, slightly decreasing versus last quarter. Gross debt amounted to MXN 4.9 billion. We finished the quarter with a very conservative LTV ratio of 29%.

During the quarter, the debt position generated a financing cost of MXN 93 million. The net financial income was negative MXN 80 million. We had MXN 20 million foreign exchange gain without effect on cash flow. Our debt position in U.S. dollar generated a MXN 32 million positive impact, partially offset with our cash position in USD that generated a MXN 12 million negative impact. Please note that at the end of the fourth quarter, 40% of our cash position is dollar-denominated.

Regarding our banking relationships. We signed a waiver to a covenant for the full year 2021. We signed an amendment regarding the BBVA 1 credit line that reduces the capital amortization payment to MXN 9 million during 2021 and 2022. This amendment reduced MXN 169 million in capital amortization payment in the next 2 years.

We still have the MXN 250 million credit line available. We are under negotiation to improve amortization schedule for the year 2021 with an extension of MXN 300 million with Sabadell, and we had a bondholders assembly that gave us a waiver for the 2021 regarding the DSCR close that limited new debt insurance. And that gave us a possibility to refinance any debt with improved terms even if the DSCR covenant is not in compliance.

We currently expect a return to Sabadell, and if so, 2021 amortization schedule should be around MXN 120 million versus MXN 410 million before amendment, a 70% decrease. As of December 2020, our debt structure is extremely healthy. Less than 7% is maturing during 2021, half of our debt is at fixed rate and half is a variable rate, average cost of debt is 7.36%. We only have 5% of our debt in U.S. dollar, $30 million.

During the second quarter -- the fourth quarter, sorry, we deployed MXN 46 million of maintenance and repositioning. In the fourth quarter and in line with our Audit Committee on our auditors' recommendation, we did a review of the different values of our real estate properties in our portfolio. The net impact to the change in asset value was close to MXN 64 million. I would like to highlight that even though the change are small as a percentage of total asset value, this is partially due to historically conservative stance regarding the value of the asset on our balance sheet, as we'll carry the values of managed hotels at historical depreciated cost. As an example, accumulated depreciation for the properties are MXN 2.4 billion or 17% of the historical costs.

The charge includes the following: we accelerated depreciation of all the assets at 4 temporary closed [indiscernible] with the exception of land value and civil works. This was done in order to have a conservative asset value of these properties.

On our development portfolio, we reclassified a couple of land property adjacent to the Fiesta Inn Toluca and Fiesta Inn Villahermosa hotels, where we classified the finance to the hotel's value with an impact of MXN 35 million. Additionally, this chunk led to an impairment charge in the Fiesta Inn Villahermosa hotel of MXN 5 million. And this -- it includes also an increase in the fair value investment properties almost MXN 43 million. This was mainly due to the Fiesta American Condesa Cancun in which the lower short-term cash flow were less than the change in ForEx exchange expectations.

Please note that also since the second quarter of 2020, FibraHotel implemented a use of Amefibra´s definition of the funds from operations. Amefibra published this definition to standardize certain metrics in the real estate Fibra sector in line with the best international practices. For the quarter, FFO and AFFO were negative MXN 38 million versus a negative MXN 115 million during the last quarter.

During the past 3 quarters, COVID-19 negatively impacted our cash flow generation. We started the second quarter with MXN 970 million and ended the year with MXN 460 million, a MXN 510 million negative cash flow. Operating cash flow, a negative MXN 198 million.

Please note that on a quarterly basis, operating cash flow for the fourth quarter was positive up to MXN 117 million. Investing cash flow, a negative MXN 67 million. On financing cash flow, a negative MXN 245 million, mainly interest payment. As previously announced, we will not pay a distribution this quarter.

At this point, I would like to open the floor for the Q&A questions. Operator, we are ready to take any questions.

[Operator]

[Operator Instructions] Our first question comes from the line of Sheila McGrath with Evercore.

[Sheila McGrath, analyst]

I had a question on the modest rebound in occupancy in Cancun and other leisure properties. Is that mostly Mexico travelers? Or are you experiencing some international travelers? And what percent of your hotels are currently open at this time?

[Simón Zaga, executive]

Thank you for your questions. Let me now go into a little bit more detail on Cancun. As you mentioned, we have seen a faster recovery in Cancun, and we have continued to see both an increase in airlift and an increase in the bookings and in the forward numbers for the hotel. And that is not only from the Mexican market, but we still have a large percentage of international travelers.

As you know, recently, there were some restrictions, specifically for Canada, and we still do not have international travelers from Europe or from South America, those are very few. So the reality, the majority of this occupancy continues to be over 80% of U.S. travelers with the rest being Mexican travelers. And that would depend a little bit by the week, but the recovery has been very positive.

We also did see a different or a changing perspective when the U.S. government added a new restriction for having COVID death. And so we did see a little bit of a cancellation for a couple of weeks during the first quarter. We have seen the pace continue to pick up and get pass-through to where we have expected it for -- especially for March. And we continue to think that the recovery will be sustainable in Cancun if things continue in the same way that we have before.

Regarding your second question, we have today 81 open hotels, with 5 hotels that have been temporarily closed since -- since the middle of the year in the pandemic, and we expect to open 1 hotel in the coming few months, which we mentioned was Playa del Carmen, and the rest, we are continuing to do the alternatives. In total, it's around 600 something rooms growth right now.

[Sheila McGrath, analyst]

Okay. And one more question. You implemented a lot of cost-cutting measures. Just when things back and -- open back up, how much margin improvement do you expect to be able to get versus pre-pandemic when things normalize?

[Edouard Boudrant, executive]

Edouard, speaking. Thank you very much for your question. Basically, what we anticipated is once we recovered the pre-COVID-19 occupancy, we should be able to reach some higher margin in terms of lodging contribution. And then that should enhance the lodging -- the EBITDA margin.

And what we see is that by the end of -- the middle end of the year 2023, we should be reaching the same level of margin total contribution that we have in 2019. And basically, we anticipated also that we should beat the EBITDA margin by the same year. So what we anticipated is reaching in terms of occupancy at the beginning of 2020 for the occupancy rate but reaching the same region of margin a semester before due to the operating cost measure that we've taken.

And just to give you an example, in terms of the staff of the hotels, which is the highest cost, basically, if I see the close or the total cost of the staff in January '21 compared to January 2020, the cost all-in decrease by 1/3. So basically, we saw as of today the results in terms of cost. Obviously, we do not see the results in terms of margin as of today because it depend on the recovery. And everyone knows that the recovery will last a few years.

So -- but basically, as of today, the costs are optimized. And what -- we are very, very working with the operator to maintain this strong efficiency, and we hope that the revenues will gradually increase on a monthly basis and quarterly basis in order to recover the margin and to beat the margin pre-COVID as soon as possible.

[Operator]

Our next question comes from the line of Francisco Chávez from BBVA.

[Francisco Chávez Martínez, analyst]

I have 2 questions. The first one is regarding the operating conditions during January, if you can share with us how is the portfolio behaving in terms of occupancy?

And the second question is regarding the advisory fee. In your earnings release, you mentioned that you plan to normalize the payment of this advisory fee. Can you give us some color on which alternatives are you evaluating?

[Simón Zaga, executive]

Paco, just remind me, your first question was on the results we have seen year-to-date on leisure travelers?

[Francisco Chávez Martínez, analyst]

No. The first question is the operating conditions during January, or so far this year, how is occupancy during the first few weeks of this year?

[Edouard Boudrant, executive]

Okay. So Paco, basically, what we saw for the first week of the year in terms of operating results, obviously, we have been -- we've seen a slight impact of the semáforo, of the red light, in Mexico City in the metropolitan area, in Guadalajara and in Monterrey. So basically, we slow down a little the occupancy pace.

What we saw is that the occupancy was higher than -- that we have in budget, basically, between 32% and 33% of occupancy in rate. So it didn't decrease a lot if you compare with December. The impact maybe is in a rate due to the mix on the contribution of the rate, we have some growth. We have some group of doctors in Mexico City. And obviously, the rate is not so high. So we will have to monitor very closely the rate and the demand for the next few months.

We missed a little bit the budget in terms of total income. But obviously, since the end -- since middle of December when the new red light were announced, we put a lot of pressure on the hotel in terms of operating cost. And fortunately, we succeed in decreasing the operating cost in January of the hotel to some extent that we make the income target debt. So basically, we said in reaching the contribution that is planned.

[Simón Zaga, executive]

[Foreign Language]

[Edouard Boudrant, executive]

Sorry, if you can put in mute, people that are not talking. So basically, what we saw in the environment, it's still challenging, but all the measures that we've taken are very, very productive. And in terms of reserves, we still are online. And what we saw is during the month of February. Gradually, the occupancy rate is increasing. It's increasing.

So basically, yes, the environment is quite very tough. But we feel comfortable that with the geographic breakdown of the -- or footprint of the portfolio on all of the measure of the -- that we've taken last year, we are in good shape to reach as soon as possible a full AFFO breakeven as soon as possible.

[Simón Zaga, executive]

And Paco, I think that's just to complement certain areas. As you know, we have a different business cycle generally for hotel. So we had within it, it's normal business cycle and volatility. We have continued to see, week-by-week, continued improvement in the numbers. Even though, as you know, January is generally not comparable to previous months, but we have continued to see these trends.

And finally, regarding your second point, as you know, the adviser has been supporting the company for over a year now in terms of cash flow. And as we have continued to normalize operations, we expect the payment to return to normal as it should be. And the Practices Committee is looking at different alternatives for what the adviser supported us during 2020. But we do expect this to basically go back to normal, which would be the first time in the first quarterly results for April.

[Operator]

Our next question comes from the line of Froylan Mendez with JPMorgan.

[Fernando Froylan Mendez Solther, analyst]

Firstly, congrats on the results. They really highlight your ability to evolve during the crisis.

I have 2 questions, please. First, I would like your views on the ground in specific markets on how competitive dynamics are evolving? I'm wondering if there is sustained pressure on prices where occupancy has already recovered. And in that sense, also, how are the negotiations with corporate accounts evolving? And where are you closing those corporate tariffs versus 2019?

And secondly, could you expand on the evolution of Posadas contract negotiation? Any view on the income that we could expect this year from fixed contracts and how it compares to 2019?

[Simón Zaga, executive]

Froy, thank you so much for your questions. And as Edouard mentioned and as you have previously also pointed out, we have continued to see pressure in rates. I think that the positive side, as we have said in the past is, especially, the price of corporate agreements have not had a reduction in prices or reductions in costs.

So let me give you an example of what you see for our portfolio is that individual -- in the negotiated business tariff, we lost in the first quarter of last year, almost 125,000 rooms that we did not have. That means that all of these room nights that corporate clients used to stay at our hotels did not pay at our hotels. These are generally one of the highest rates, and they're the negotiated rates for the company. And so what we have to do is we increase the group in virtual or OTA-type rate and also groups. And especially where you see the impact in rate is in one repetitive groups.

To give you another example during the -- as the COVID crisis picked up again in December and in January, we accepted several groups of medical doctors that came to Mexico City to support the hospitals and the crisis. And really, these type of groups and doctors, which are not going to repeat and which have already started checking out of some of the hotels, they have some of the lowest rates that we have in the hotels. And so we have been subject during this type of customer of individual business customers with nonrepetitive groups where we are able to offer them a discounted or a lower rate because it is a once-in-a-lifetime opportunity.

And so basically, in the end, we do see a change in mix, and this change in mix is having an impact on rate. But I think overall, we are not seeing pressures from corporate or contracts in order to reduce rates, and even if we did that, that would not increase the demand. And so we continue to be very strict in terms of maintaining the rates and the tariffs that we have and only being able to change for a different type of customer that we can take advantage of in the short term.

[Fernando Froylan Mendez Solther, analyst]

If I just follow up there, what kind of ADR evolution are you thinking about when you mentioned reaching 2019 margins in -- at the end of -- in the mid of 2023, what kind of curve are you assuming?

[Edouard Boudrant, executive]

Basically, we were assuming in the budget an increase related to inflation rates in Mexico, so between 3% and 4%.

[Simón Zaga, executive]

And that is especially a little bit on how the demand recovered from it. We do think that depending on what happens in the sector and what happens to other players, we might be in a favorable position in the medium term, and we will go back to having pricing power. We're just not sure how far out that is.

[Edouard Boudrant, executive]

And then so Froylan, just to highlight as of today, the ADR is not representing an ongoing deal in a recovered situation. And for example, Marriott, which depends a lot on international travelers, it is not so strong as of today as it was to pre-COVID-19. Mexico City and Monterrey, they drive up the global ADR as of today due to the red light, is not financing the ADR as it did 1 year before. So basically, also, we have to take into account the performance of each hotels, each operator of each cities in the portfolio.

[Simón Zaga, executive]

And Froylan, this is Simón just to answer the question about Posadas. Posadas has not finalized a negotiation of the funds with the bondholders. That is still pending. I do not have more information that the market has on that.

But the issue that I can tell you is that Posadas has been -- it has been honoring all of their agreements with us and everything that we agreed upon both in the fourth quarter and now in the first quarter. We do have agreements, and they have been paying, on time, their minimum rent of the hotel, obviously, negotiated as we announced, but we have had success in that relationship and the long-standing relationship with Posadas.

And to finalize my comments, I just want to make the point that, as you remember, the older hotels that are under operation, all the income comes through FibraHotel and then we pay Posadas a variable -- 100% variable fee for their brand and their operations. So we have the control of the cash flow, and we have not needed to use it. Both -- Posadas has been honoring everything throughout until this moment, and we hope that they will continue doing so in the future. So that's the update about Posadas.

[Operator]

Our next question comes from the line of Armando Rodriguez with Signum Research.

[Armando Rodriguez, analyst]

Congratulations on these achievements despite this tough economic environment. My question is really to answer just a follow-up on your debt position, particularly on the Sabadell credit line that I think it's the main debt maturity during this year. I'm sorry, I can't hear the Edouard's comments on the refinancing strategy. If you can share with us any updates on this credit line, we will appreciate some of your comments.

[Edouard Boudrant, executive]

Thank you very much for the question. So basically, the last item -- that ongoing item that we have in order to have a very strong amortization schedule for 2021 is the refinancing of the MXN 200 million revolver facility that we have with Sabadell. It's a 2-year facility. We signed it first in 2017. We are renewing in 2019. We drawed on all the line 1 year ago in order to strengthen the liquidity at the end of March to anticipating very, very tough condition for the rest of the year.

And contractually, it matured in May of 2021. During the past few months, we have been negotiating with them. And as of today, we have a resolution. So basically, it will be a 2-year extension for the credit line. And as of today, the spread is paying 10 year plus 150, and we are agreed to pay once its renewed, paying it, plus 200 basis points. So basically, this is the kind of situation we are with them as of today.

It has been authorized by their credit risk. It has been authorized by the Technical Committee. And as of today, we are in the process of the legal documentation.

[Operator]

Our next question comes from the line of [ Edson McGary ] with [ Summit Cast ].

[Unknown Analyst]

I have 2 of them. The first one is related with this new part of the press release that you expressed, that is a possibility, or at least that what I understood, that you can issue new bonds because the last committee meeting was -- approved that. So is that so? Are you planning new issuances for this year or maybe in the future?

The second one is regarding the closing of Fiesta Americana Hacienda Galindo acquisition. It's due later, will it happen this year? Or it will happen in a specific quarter because of MXN 156 million possible impact in your cash flow?

[Edouard Boudrant, executive]

Basically, I didn't understand the first question regarding the bond. I presume it's related to the covenant that the waiver that we ask to the bondholders. And basically, while we ask this waiver, is that in the documentation? We cannot issue new debt even in the market, in the public market or even with financial institution if the mature debt service coverage is under 1.5. And last year, as we had a negative EBITDA, close to breakeven, but negative. This ratio is not -- we do not comply with this covenant. So basically, we cannot issue debt.

And what we need, for example, is we want to take the credit line available of MXN 250 million, we need a waiver to this covenant. So since December, we have very competitive talks with the major bondholders. We agreed in some terms for the waiver, and we did it 15 days ago.

And also, what we add in the documentation is that even if we wanted to refinance any debt, that is to say, do not increase the outstanding level of debt, it was not possible due to this waiver of the DSCR ratio. And what we agreed is if we want to refinance any debt, we can do it even if we do not comply this ratio and also discussing with the main bondholders that it makes all the sense of the world. It was not -- the documentation was not in the best way possible.

And after that, I understand that you ask if we plan to issue a new bond. As of today, this is not the reason why we ask for this waiver. We have not planned to issue any bonds this year or in the short term.

As of today, what we are working on is to improve the cash flow before tax, is to improve the amortization schedule and is to pay the debt that is amortizing with the cash flow of the hotel.

And that [ Edson ], your second question regarding Fiesta Americana Hacidena Galindo, yes, we have a payment to due to -- post that. It's a payment that if you remember, we had to do that 12 months ago. We postponed, we postponed, we postponed. But it will come this year and what we plan to do that is to make the payment before the end of this quarter.

[Unknown Analyst]

It was really clear. Follow-up on this one, is it going to be this first quarter '21 on the Hacidena Galindo acquisition?

[Simón Zaga, executive]

We currently expect it to be first quarter '21. There are some -- we still need to have some things closed up on the legal side, but we expect it to be in the following months.

[Unknown Analyst]

Okay. Okay. And congrats for the performance of you and hoping that everything is going to be -- all the recovery is going to be faster.

[Simón Zaga, executive]

Thank you. We agree, and we hope for the best.

[Operator]

That's all the time we have for questions. I'd like to hand the call back to management for closing remarks.

[Simón Zaga, executive]

Thank you very much for being on the call. And we hope your families are safe, and we will continue working hard on FibraHotel, and thank you very much for your interest. All the best.

[Operator]

Ladies and gentlemen, this does conclude today's teleconference. Thank you for your participation. You may disconnect your lines this time, and have a wonderful day.