Simcorp A/S

CSE:SIM

Earnings Call Transcript 2018-Q3

[Operator]

Good day, and welcome to the SimCorp Q3 Report 2018 Conference Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Klaus Holse, CEO. Please go ahead.

[Klaus Holse, CEO & Member of Executive Management Board]

Thank you very much, and thank you for all of you that are joining this conference call where we're going to walk you through the first 9 months of SimCorp and the Q3 financial review. If we move to Slide #2, then you will see the usual disclaimer that we have for everything that is conducted in this meeting. So if you haven't read through that, then I suggest you do so. But I think that most of you on the call will have done that, so we'll move on to Slide #3 that has the agenda for today. So first of all, we're going to walk you through the highlights of Q3 2018, I will do that. Then I will turn it over to Michael Rosenvold, our CFO, who will walk you through Q3 financial review in a little more depth and then Michael will also take you through the outlook. After we've done that, we move on to the Q&A section where we will take questions on this call and there's also the opportunity to ask questions over the web and we will also take those questions, they will be read in this room and then we'll try to answer those as well. If we move on to Slide #4, then you have Q3 at a glance. So if you start out at the very top, then our order intake was EUR 14.5 million for the quarter. It was down a little over last quarter -- over last year. We did sign 1 new SimCorp Dimension client in the United States and we signed a few larger add-on contracts. We also had a few contracts that slipped into the fourth quarter so that gives us a lower order intake. Revenue growth order in local currency, about flat, 0.2% up. So that's in reported revenue, 0.5% down. EBIT of EUR 15.1 million, which is a decline of EUR 4.5 million over last year. The EBIT margin was up -- or was 18.8% and in local currencies, 19.1%. Professional services growth also slowed down a little. We had a very large Q3 last year. Saw a 3.6% growth in Q3 this year is what professional services came in at. 12-month rolling software updates and support growth has jumped up to 7.6%, which we're quite happy about. That's the recurring revenue of the company. That's stemming from existing clients going live with new functionality as well as some of the clients we've sold in past quarters and years going live on the system. Free cash flow is significantly up over last year, and I'll let Michael give you little more details as we move in through the details. So Q3, all up, I would say a little slower than we would have wanted on license sales, but good growth in recurring. If we then move to Slide #5 where we have -- kind of our 9 months of the year in one slide. Then you will see that our revenue growth continues to be on a good track. So Q3, combined with the previous 2 quarters, still gives us 13.7% growth. For the first 9 months, order intake was EUR 14.4 million -- or EUR 40.4 million, up EUR 7.8 million over last year. EBIT also up EUR 9.5 million to EUR 52.5 million. And order book almost -- or more than double what it was a year ago at EUR 30.3 million. Professional services still continues to grow over the full year at almost 15%. Free cash flow, up very significantly over last year, as I told. So all up for the 9 months, we think we are on a good track and that's good, even though Q3 was a little slow. If we move on to Slide #6, there's a list of new clients in 2018 and that is a fairly short list, as you can say. The first 2 quarters we've talked about, and in Q3, we've got a new order from the U.S., the Federal Home Loan Bank of Des Moines. That's a full front to back office solution that is being installed at that client. If we then move on to Slide #7, there's a couple of news items that we would just highlight. The first one is that we opened a new office in Japan. That is because we think that the Japanese market is an interesting market for us, all up. It's a market that has a lot of asset owners, mainly pension funds, insurance companies and so on that are amongst the largest asset managers in the world. It is also a market that is heavily on domestic assets, which is not a good fit for us, but it's a market that's increasingly opened up their trading nondomestic assets and is becoming an interesting market, specifically for fund owners. So we think that in the Japanese market, there's an opportunity for us to sell SimCorp Dimension to customers that are in need of a good system for their nondomestic assets and in need of a good front office system. We opened the office, then we engage in finding new clients out there and hopefully we will see new clients coming on maybe towards the end of this year or early 2020, that's how we position the company. If we move on to Slide #8. There's a new partnership. As you will probably have noticed in almost every quarter, we have a partnership -- we do -- we continue to partner with companies around the world to offer a more complete solution for SimCorp Dimension. In this case, it's Qlik who is one of the leading business intelligence providers in the world and what we'll do with Qlik is we'll enable our customers to check data from SimCorp Dimension, SimCorp Dimension Data Warehouse as well and then as the very strong business intelligence tools allowing them to create dashboards and tracking and so on of their performance. So that's a good collaboration where you see Qlik on top of Data Warehouse and fully integrated into the system, allowing us to show -- give customers insights of what actually goes on in the system. If we move to Slide #9, for those of you who are not at our Capital Markets Day, I'll just kind of delve in that a bit. The five must-win battles that we had in '18 will continue in '19. So we'll continue our investment in getting front office to a market leadership position. We think we are in a very good position in Europe, but still have still a little ways to go in the U.S. to gain more front office across the U.S. And that kind of links to the North America growth ambition that we have of getting more front office deals and deals in total in North America, but also up north.Alternative investments, we released the first batch in early part of '18 and the majority of that product comes out in early part of 2019 and is on a good track. Standard Platforms continues to be on a good track and there's further investment we're making there. The latest must-win battle of these that are kind of pointing really into many years in the future is enabled cloud battle. And if you flip to Slide #10, I'll give you a little more detail on how we think about that cloud battle. What you'll see is if you look at the left-hand side of the slide and you look at the product called SimCorp Dimension, then that kind depicts the whole system of SimCorp Dimension, the investment book of records and the 4 modules that sit on top. There is basically 3 deployment methods for that. One is that the customers host this on-premise at their own facilities. There's also the opportunity for us to host and manage the system for them as a service, which is what you recall the ASP solution or our hosted cloud solution is there for these customers. There's also the opportunity for the customer to not have the system installed on-premise, but having them installed on Microsoft Azure or Amazon Web services and so on, but still continue to manage the system on their own. That's basically 3 options for running SimCorp Dimension and it varies by customer where they are on the continuum front, that they want to manage the system on their own, either in their data center or in a public cloud solution or they want us to manage it. All the options are available. And then to the very right of this is where we're building a set of applications that it connects to SimCorp Dimension and they're built in the native cloud and such connecting to that. At the very bottom of this, you also see kind of where the hosting is, either in traditional data center, in private cloud or in the public cloud. That's kind of how this evolves. That means that with SimCorp Dimension, we give full flexibility to our customers to consume the system the way they want, either in their data center, our data center or in the public cloud. It's a very open method of doing this based on that the customers we have, have different needs and different preferences and we will be able to cater to all of those and not be intimidated.If we move to the next slide, it's kind spelled it out a little bit more on what happens on-premise such that the customers can do on their own. Then where we have SimCorp as a service where we offer the products as a service, that's a natural choice for many new clients. But we also see existing clients moving on to this one. And then the self-managed in the public cloud. We don't have these yet, but we have a number of clients who look at this as an alternative to their own data center, but their IT department still wants to run this now either on Amazon or on Microsoft Azure. And the last one is cloud native, that's where we build complementary functionality and allow also partners to build functionality that then connects to SimCorp. That's kind of the story on the cloud, a very flexible solution to this based on what our customers' needs are. And I think that's a must-win battle you will continue to see on our roster for a few years and it'll probably get built out as we go to more as-a-service for many other things in SimCorp. So with that, I'll conclude my section on this one and hand over to Michael Rosenvold to take you through the financial review. So if you go to the next slide, there's a repeat of the agenda where Item #2 is Q3 2018 financial review. Michael, over to you.

[Michael Rosenvold, CFO & Member of Executive Management Board]

Thank you, Klaus, and I'm now on Slide 13 where we have our traditional waterfall diagram showing where we get from reported to organic and describing the impact from currency and from M&A. And as you will see, the impact from currency or the FX impact is pretty small in this quarter. As the U.S. dollar has increased its value, we are having a less impact of currency. And you can say the headline is, as Klaus also mentioned, we had a quarter of slow license sales, which naturally led to lower revenue and EBIT margin than in Q3 2017. So the EBIT margin organically was 19% in this quarter and the revenue growth was flat to slightly negative. Turning page to 14. We have the same illustration for the 9 months, and here, you can say the headline is double-digit revenue growth and an improved EBIT margin in -- for the first 9 months compared to the year before. So if you look at the revenue growth, the FX impact is higher, so minus 3%. We also had a higher impact from M&A from SimCorp Italiana. And in terms of that, in local currency, the EBIT margin was 13.7%, which you can compare to our full year guidance of between 10% and 15% for the full year. So you can say, for the first 9 months, very much in line with the guidance for the full year. If you look at the EBIT margin, it is an EBIT margin organically of 20.6%, and in local currency, 21.5% compared to 18.8% a year ago. So a higher margin than what we had for the first 9 months of 2017. And as you all are aware, normally, the fourth quarter is the strongest quarter so that's also where we normally have the highest EBIT margin. If we go to the next slide, 15, we have an illustration of the order intake, which also illustrates here the traditionally high Q4 impact. So if you look at this, for a year ago, you see a pretty high order intake in Q4. And if you look at the first 3 quarters this year compared to the first 3 quarters last year, we are having a total order intake of EUR 40 million, which is actually up by EUR 8 million compared to the same period last year. Going to Slide #16, we are showing the order book where we are comparing Q2 2018 to Q3 2018. And here, the order book is increasing by EUR 4.5 million, indicating that we have more revenue to recognize in future periods than we did in this period. So you can say some of the order intake this period will be revenue recognized in later periods. If we look at and compare the order book compared to 1 year ago, so in Q3 2017, we are, in fact, having an order book, which is EUR 15 million higher than the year before, so you can say an increase of 50%. We have had a lot of factors in our client driven development order book, and here, we have EUR 9 million in order book compared to EUR 1.4 million at the same time last year. On Slide 17, we are describing the different revenue streams and how that has developed both into 3 and for the first 9 months. And if we look at Q3 first, total license revenue went down by EUR 4.4 million compared to the same quarter last year. Bear in mind that part of the order intake is not yet revenue recognized and will be that in later quarters. Positively, if you look at the software update and support revenue, we have an organic revenue growth in this quarter of 9%. And if we look at the license sales for the first 9 months, we grew by 13.5%, and here, also we have some order intake, which is not revenue recognized yet. Finally, professional services had an organic growth of 8.6% for the first 9 months. On Slide 18, we are splitting up the add-on license revenue sale and what is quite clear is that additional regular license sales is the main part of both the Q3 and the first 9 months. So in Q3, it's about 8% of our add-on license sales. And for the first 9 months, it's more than 70%. We had no conversions in Q3. And if you look at first 9 months, conversions is accounting for less than 5%. Next slide is Slide 19 where we are showing the cost development. And on an overall level, the organic increase in cost was 5.5% in Q3 and it was 5.9% for the first 9 months. And looking at administrative costs, it was an increase of 1% for the first 9 months. Cash flow. We had -- that is on Slide 20. We had a strong cash flow in the first 2 quarters of this year relative to 1 year ago and that continued into Q3, so a better cash flow in Q3 compared to the year before. And looking at the first 3 quarters, we are significantly ahead of the cash flow from last year, having a free cash flow of EUR 64 million compared to EUR 36 million a year ago. This is primarily due to a positive development in receivable where we have reduced it by EUR 16 million and also more prepayments from clients where we have gained EUR 9 million. So both a positive development in receivables and in prepayments from clients. Then turning to Slide 22 where we are stating that based on what we have seen so far and what we know about our order pipeline for the rest of the year, we are maintaining our full year guidance of revenue increase in local currency of 10% to 15% and an EBIT margin in local currencies between 24% -- 24.5% and 27.5%. On Slide 23, we have made an illustration where we are showing what we have secured on contract in reported currency of EUR 321 million, and then converting that into local currency, the FX impact of EUR 7 million. And then we also have order book where we have not finally secured it, but we have a clear expectation that, that will be released in Q4. And that actually means that to get to our full year guidance, we need to close a gap of EUR 45 million to EUR 62 million. And if we look at the same period last year, that gap was EUR 55 million, so you can say we need to deliver something quite similar to what we delivered last year and we believe that our pipeline is justifying that we will be able to do that. So that's based upon orders today. That concludes my presentation. So I believe it's time for Q&A.

[Operator]

[Operator Instructions] We will now take our first question from Claus Almer of Nordea.

[Claus Almer Nielsen, Senior Analyst of Capital Goods and IT]

A few question from my side. The first question goes to the order intake. If we look at the ALF, it appears as majority of the licenses was driven by 3 larger orders. Should we expect a rebound in Q4? Let's just call it a more normal order intake from ALF. That will be the first question.

[Klaus Holse, CEO & Member of Executive Management Board]

So this year, we've seen ALF come in at a good pace in the first quarter and the second quarter and we've seen a decent ALF inflow in the third quarter as well. Q4 will, as always, be a strong ALF quarter. That's kind of what it should be and I'm sure -- our hope is -- our expectation is that we show growth over last year on ALF as well.

[Claus Almer Nielsen, Senior Analyst of Capital Goods and IT]

Okay, and then looking at -- what do you mean by in total?

[Michael Rosenvold, CFO & Member of Executive Management Board]

I don't think, Claus, that we would expect Q4 this year to be better than Q4 last year. But in total, we feel it should be better growth.

[Claus Almer Nielsen, Senior Analyst of Capital Goods and IT]

Okay, 2018 versus 2017, you mean?

[Klaus Holse, CEO & Member of Executive Management Board]

Yes. It will be better, yes, it will better.

[Claus Almer Nielsen, Senior Analyst of Capital Goods and IT]

Okay. Then the ILF where the pipeline is strong, which is -- looks good going into Q4, but could you maybe put some color on, in a more average scenario, what should we expect from ALF in Q4?

[Klaus Holse, CEO & Member of Executive Management Board]

So in ALF, I can say that we -- so first of all, say in Q3, we probably expected to see a deal or two more come in. That got postponed into the fourth quarter. So for ALF, we've got a number of deals that are very late stage in our pipeline, so in contract negotiations and our expectation is that they're going to get signed in the fourth quarter. And if everything progresses the way it should, they'll get signed in the fourth quarter. But we've also seen that contracts are taking longer to conclude than we've seen in the past. Nevertheless, our expectation is still that these deals get signed in the fourth quarter and we come out at a good level of ALF.

[Claus Almer Nielsen, Senior Analyst of Capital Goods and IT]

But Klaus, let's just -- looking at on an average scenario, would be -- should we expect 3 or 5 new Dimension clients? Or what's the potential there?

[Klaus Holse, CEO & Member of Executive Management Board]

I won't give you a specific number, but I will say that if we only get 3, that would be disappointing. And I would say the potential is more than a handful.

[Claus Almer Nielsen, Senior Analyst of Capital Goods and IT]

Sure, okay. And then my final question goes to the cost base and I have to say I'm a bit puzzled about how it has been trending Q2 and Q3. How much of the decline in costs in Q3 over Q2 was driven by timing?

[Michael Rosenvold, CFO & Member of Executive Management Board]

I will say the good thing about our model is if we sell this, we get less bonus or we allocate less bonus. So you can say the commission goes down when you're not selling that much and also the bonus allocation goes down when you're not selling that much. So that has an impact and I think that's kind of the projection in our EBIT. So if revenue is lower than last year, then you will also see less bonus and you will see less commission. So I think that is -- it's more that than it is a timing event. Also we have been, of course, focusing as we promised you on the cost items that we also did in Q3.

[Claus Almer Nielsen, Senior Analyst of Capital Goods and IT]

Okay. But then looking at your implicit Q4 cost guidance, which is set to increase by 25% over Q3, that's a huge increase given your high share of employee costs. What will drive this increase? And this is really realistic that you should spend more than EUR 80 million in costs in Q4?

[Michael Rosenvold, CFO & Member of Executive Management Board]

I will say the same goes when we are then delivering, also when you're releasing order book into revenue, then there will also be some bonus and commission related to that because we're not paying commission before it is turning into real revenue. So you don't get the commission on order book, but you get it on revenue. And the same goes for bonus. So we don't pay bonuses for order book, but more when you have realized the revenue. So that is part of the explanation why you can mathematically calculate the costs will go up in Q4. And then, of course, we will do our utmost to make sure that it's not going up too much.

[Claus Almer Nielsen, Senior Analyst of Capital Goods and IT]

But even adjusting for the sales bonuses, at least from the levels we have seen in the past, in my view, it must be very difficult to hike the cost base to as much as EUR 80 million?

[Klaus Holse, CEO & Member of Executive Management Board]

So first of all, the EUR 80 million is calculation that you've come to, Claus, that might not be true cost we have. But we'll spend the cost we need to spend and no more than that, let me put it that way.

[Operator]

We will now take our next question from Daniel Djurberg of Handelsbanken.

[Daniel Djurberg, Research Analyst]

Two questions, if I may. The first is with regards to North America. At the recent Capital Markets Day, we saw quite good demand from U.S. insurance company driven by in-sourcing and expansion to -- or they're offering to third-party. Did I understand this correctly? And is this still the case? And also you saw some weak demand from traditional asset manager. Can you elaborate for me the demand situation in the U.S.?

[Klaus Holse, CEO & Member of Executive Management Board]

So I'm not sure, I 100% follow the questions, but let me see if I can try in any way to answer it. So in Q3 -- in -- at our Capital Markets Day, we described a general trend that we see in the market we think is going to last over multiple quarters as such where asset owners are going to take more control of their own destiny, they are sending less money to the asset managers, the asset managers are kind of getting under pressure by some of the ETFs and so on. So that's where -- that's a market trend that we're seeing. That market trend has, in some senses, nothing to do with our Q3 results. So if the question goes along the lines of is that what kind of drove a delay in an order or two in Q3, then the answer is no. That is a longer-term market trend we see. But for this specific contract, we -- that's a specific contract that moves, that's not depending on...

[Daniel Djurberg, Research Analyst]

Okay, no changes there. And another question from me would be regarding your SimCorp cloud offering that is on the SimCorp Connect. That solution is increasing, I think you have now 7 APIs added to this and so on. I was just thinking, in general terms, if you compare a Dimension component with the SimCorp Connect component or different solutions there, is it harder to get the substantial recurring revenue base from [ referrals] it's so much lower revenue per component, if you understand my question. If it's -- can it be substantial going forward, these add-on revenues?

[Klaus Holse, CEO & Member of Executive Management Board]

So if you look at it with SimCorp Connect, there's probably 2 different revenue streams coming from that. One revenue stream is the SimCorp Connect revenue stream where the user of the APIs pays for the usage of the API. In some sense, you can say that's comparable to what we get in terms of user licenses because this is where typically it would have been an end user to invest, now it's some other tool or model that's actually accessing the API. So that's a revenue stream from that, that either will add on to what would've been a user in the past or would substitute what was used in the past. So that's a revenue stream we see today. As users, that could generate more. Then there's a revenue that comes from us building new modules that are cloud based only and we're doing a few of those at this point, and that is the same as what we -- or kind of the same revenue stream as if we built it on-premise in the past, that becomes normal ALF revenue, if you will. Then there's a third revenue stream that is not very big today that we've not given an estimate on how big that could be, which would be [ half us ] building modules that accesses SimCorp Dimension using these APIs. That is a revenue stream, kind of an ecosystem revenue stream, but it's not substantial today and it will take a while for that to become substantial.

[Operator]

[Operator Instructions] We will now take our next question from Bo Dels (sic) [ Velds ] of Carnegie.

[Bo Velds Andresen, Research Analyst]

Just a question relating to your orders like some client driven developments. Do you have like a lower visibility in terms of revenue recognitions on these kinds of orders? And secondly, what are the margin differences versus more ordinary orders. Can you elaborate on these things, please?

[Klaus Holse, CEO & Member of Executive Management Board]

Sure. Client driven development is highly visible and a little lower margin than just like. So let me describe kind of what the mechanism is. So every quarter, basically, we publish a road map for where SimCorp Dimension is going to go in the next 2 years. We kind of describe what's going to develop -- kind of get developed in the next 24 months, Bo, therefore. Sometimes, have customers that said, what I really need is in the quarter #7 of this or it might even be in quarter #9 of this. And they want that to be prioritized, moved faster from that pipeline into a more quarter, say, closer to current time. And then they pay for this. So they pay for us to speed up the development of that functionality or that module for us. So that's kind of a speed up on it. That alone, we make some margin on. And then after the module is developed, we still sell that module to every other customer we can get away with at the same margins as every other software we sell. So that's what kind of the mechanics is. So if you look at the EUR 9 million CDD that sits in our order book, we have very high visibility because as soon as we release that component, the customer pay that part of the CDD, so that's a very high visibility, but it has about the same margin as our consulting business.

[Bo Velds Andresen, Research Analyst]

Okay. And then the proportion that you expect if you have so high visibility, the order -- the proportion of the EUR 9 million, was that related to the fourth quarter? Is that all of it?

[Michael Rosenvold, CFO & Member of Executive Management Board]

Very little, very little. What happens with CDDs is that we will not revenue recognize before it is built and delivered and very little into Q4.

[Bo Velds Andresen, Research Analyst]

Okay. Then regarding the -- when Klaus also mentioned the increasing cost levels in the third quarter, also like the number of employees have increased and can you try to give a flavor on where you upscaled besides your new Japanese office?

[Klaus Holse, CEO & Member of Executive Management Board]

When we have more -- we have very few people in the Japanese office to start with. We will start that mostly from our Singapore office. But we have the office, we'll add a few people in Japan. So should not expect to see a huge cost increase because of Japan.

[Michael Rosenvold, CFO & Member of Executive Management Board]

So where we have added the people is in our product development, which is, you can say, a normal process. As you know, we are investing approximately 20% of our revenue in product development. And as revenue is increasing, we are also increasing our investment and that has an impact on some more people. And then we are also increasing, to a lesser degree, in our professional services, also we have more own people and less [ extra rents ].

[Operator]

We will now take our next question from Hannes Leitner of UBS.

[Hannes Leitner, Equity Research Analyst of Software]

I have 2 questions, please. The first one is on the slipping deals in Q3 to Q4, does this indicate those contracts are of larger size? And then if you look into 2019, can you speak about the pipeline and how it's shaping up?

[Klaus Holse, CEO & Member of Executive Management Board]

Yes. So the deals slipping from Q3 to Q4, we won't comment on the size of the deals. But I would -- you could probably do the math and say if we had a typical growth in the quarter, you would need another few million euro and that's how much slipped. But in general, we don't comment on the size of the deals. So there's at least some revenue that slipped in that sense. But 2019, so far, it looks good. We keep building pipeline for '19 as well. So we feel good about it at this point.

[Michael Rosenvold, CFO & Member of Executive Management Board]

And I think the pipeline is a good mix of some smaller, some medium and also some above average deal sizes. So I think we have a good mix in our pipeline.

[Hannes Leitner, Equity Research Analyst of Software]

Okay. And a quick follow-up. Can you quantify what kind of synergies you expect from this Qlik partnership?

[Klaus Holse, CEO & Member of Executive Management Board]

There's no synergy as such. What we expect is that we will sell -- we'll resell some of the Qlik product to a number of our customers, and by that, we'll get a referral fee from them. So that's kind of how it works. So in some sense, this is where we take the sales force that we already have that is visiting our existing customers anyway and then we kind of create an opportunity for Qlik to be sold into those customers. That's part of the revenue stream and the other part is we will kind of take some of this product and put it in to our product.

[Operator]

[Operator Instructions] It appears that there are no further questions at this time. I would like to turn the conference back to the hosts.

[Klaus Holse, CEO & Member of Executive Management Board]

Thank you very much. We do have a couple of questions that have come in over the net. So we'll take those questions and see if we can answer those as well.

[Unknown Executive]

Actually, the last question comes from Oliver Knobloch at Pictet. You asked -- the first one is, "are the strong CDD orders linked to SimCorp Connect?" That's the first one.

[Klaus Holse, CEO & Member of Executive Management Board]

So maybe just take that one. No, that is not the case. So the CDD orders are different parts and functionality that we expect to develop in SimCorp Dimension core.

[Unknown Executive]

Okay. The other questions all links to the Japanese market. First one is, "what kind of software do Japanese asset managers and owners use until today, proprietary or standard software?" And in connection with that, "did you enter the market on potential client requests? Or was it on your own initiative?"

[Klaus Holse, CEO & Member of Executive Management Board]

So first of all, the Japanese market is from a system perspective, split between kind of some domestic systems and some that are coming from the outside. And they -- the domestic systems are mostly the back office systems for their domestic assets. There's a Nomura, their research institute out there has a, I would say, almost monopoly on that market the way they've connected the whole back end of the domestic market. That's a market that it's very, very hard to get into. Then on the market for nondomestic products, there's an opening there and there's certainly an opening in the front office area because there are -- there's none of the domestic Japanese products that covers nondomestic products in front office. This is also why you see companies like Charles River and BlackRock having an auction in Japan and we think we have the same option with the front office offering we have, the IBOR we have. So in that sense, that's where we're going. We have had a number of customers talk to us in the Japanese market that we think is interesting. We also have a number of our other global customers who have offices in Japan where SimCorp Dimension is already in use today. So we've got 3 customers in Japan already live on the product that we can use as references for potential domestic Japanese clients to get on the system as well. So in some senses, this was just a number of things coming together that kind of makes sense for us to start marketing into the Japanese market in a more forceful way. Yes? So we have no more questions from the web. So if there are no more questions over the phone either, then we will say a big thank you for dialing in to the call. And we will see you, again -- or listen again when we get to February where the full year result comes out. Should you have questions in the meantime, feel free to contact Anders or any of the rest of us for those questions. Thank you very much.

[Operator]

This concludes today's call. Thank you for your participation. You may now disconnect.