Turkcell Iletisim Hizmetleri AS

IST:TCELL.E

Earnings Call Transcript 2021-Q1

[Operator]

Ladies and gentlemen, thank you for standing by. I'm Haley, your chorus call operator. Welcome, and thank you for joining the Turkcell conference call and live webcast to present and discuss the Turkcell First Quarter 2021 Financial Results Conference Call. [Operator Instructions] The conference is being recorded. [Operator Instructions]

At this time, I would now like to turn the conference over to Mr. Ali Serdar Yagci, Investor Relations and Corporate Finance Director. Mr. Yagci, you may now proceed.

[Ali Yagci, executive]

Thank you, Haley. Hello, everyone. Welcome to Turkcell's First Quarter 2021 Results Call. Today's speakers are our CEO, Mr. Murat Erkan; and our CFO, Mr. Osman Yilmaz. We have a brief presentation, and afterwards, we will be taking your questions.

Before we start, I'd like to kindly remind you to review the last page of this presentation for our safe harbor statement. Now I hand over to Mr. Erkan.

[Murat Erkan, executive]

Thank you, Ali Serdar. Good morning, and good afternoon. Thank you for joining us today. We had a strong start to year delivering robust financial results despite the prevailing challenges of pandemic. This performance was possible due to our customer centric strategy, built on a diversified business model. This strategy has enabled the continuation of solid growth in total subscribers by 705,000, marking the highest level of the past 3 years.

Our strong and fast network, convenient digital fashion and value offer have been instrumental in this success. Accordingly, we recorded 17.5% top line growth, generating TRY 7.8 billion consolidated revenue. EBITDA reached TRY 3.3 billion on 17.7% growth with a 42.2% EBITDA margin. Net income was TRY 1.1 billion on 26.6% year-on-year growth. Overall, these results have confirmed our confidence in achieving our full year guidance levels.

Next slide. Let's have a look at our operational performance in the first quarter. On the mobile front, we gained a net 410,000 postpaid and 190,000 prepaid subscribers. Our postpaid customer base reached 22.4 million, reflecting 66% of total on a 3-point rise year-over-year. Strong momentum in the net addition is a reflection of our commitment to strengthen our subscriber base. Our efforts to establish a customer-driven mentality throughout the company have played an important role in this performance. As such, our mobile churn rate was 1.8%, the lowest level of the past 3 years. In the fixed broadband segment, strong demand has continued under prevailing mobile limitations and remote working conditions. We recorded 50,000 fiber subscriber addition with our high-speed and unlimited fiber Internet offers designed to meet the need for speed at home office.

In addition, there were 23,000 net addition to our fixed wireless access service, Superbox, this quarter. Further, we are pleased to see robust demand for our TV services. With the addition of net 49,000 IPTV customers, we now offer this service to 61 out of every 100 households among our residential fiber customers. Blended mobile ARPU rose to 49.9% -- sorry, TRY 49.9, an 8.7% rise. We felt the negative effect of pandemic on the roaming revenue generation and are on the trend for additional data quota purchases.

Despite this growth was driven by a larger postpaid subscriber base, higher data consumption and price adjustments. Fiber residential ARPU growth was at 8.8% to TRY 74.3, mainly on demand for higher speeds as well as our price adjustment. Reflecting the rising trend in installation, we expect to record double-digit ARPU growth next quarter.

Next, an update on data usage and 4.5G subscription trends. Average mobile data usage rose 29% year-on-year to 12.6 gigabytes per user. Limited mobility and continued lockdowns have impacted the mobile usage growth. 4.5G user on our network have continued their growth trend, contributing to mobile data users. Out of 32.4 million customers signed up for 4.5G services, around 70% had 4.5G compatible smartphones, still indicating significant room for growth. Overall, smartphone penetration has reached 84% with 91% of this being 4.5G compatible.

Next slide. We work with the mindset that prioritize our customers' needs in our decision-making. To achieve this, a segmented approach help us address those needs more effectively. In that regard, we have applications designed to address our core segments. Their active users have increased 16% year-on-year growth, suggesting more engagement on this platform. Additionally, our key strength, including our well invested network infrastructure, extensive distribution channel and strong brand loyalty stands out as core factor in customer decision-making. With all of the above, customer had continued to recommend Turkcell over the competition this quarter, even widening the large gap to the second best.

Next slide. I will go into detail on action in our strategic focus area on the next 3 slides. First, let's consider our digital services. The stand-alone revenue from digital service continued their strong growth at 28% year-over-year, reaching TRY 367 million. The paid user base reached 3.2 million, up by 200,000 during the quarter. It has been an exceptional quarter for BiP. There were 32 million downloads in a single quarter. Half of those were from beyond Turkey. Overall, 3-month active users have reached 40 million. BiP differentiates itself from the competition acting on its data only with users' permission policy. With BiP, we continue to enhance user experience, position it as the best communication platform. It has also been a good quarter for our TV business. With greater content and penetration on BiP sequence, we have gained a remarkable number of new users, both on IPTV and the OTT platform.

Another highlight of the quarter was the launch of our cloud gaming platform, GAMEPLUS in March, in collaboration with NVIDIA. It captured over 10,000 paid users in just 15 days. Thanks to cloud-based game technology, eliminating the need for high-speed hardware, user can access over 950 games. Going forward, we aim to launch our own mobile game publishing business.

Over the coming quarters, we will focus on launch of the B2B models of fizy, lifebox and BiP Meet with a [indiscernible] to further monetization.

Next slide. Next are our digital business services. We continue to pioneer to digital transformation of corporates in Turkey. This strategy has brought a 27% increase in digital business service revenues, reaching TRY 452 million. We are glad to see the strong demand for our digital business services, particularly data center and cloud, security services, new generation technologies and managed services. We signed over 700 new contracts with a total contract value of nearly TRY 0.5 billion. Overall, the backlog from system integration and managed services projects signed to date has reached TRY 1.1 billion. We strengthened our global partner ecosystem with the additional Palo Alto Networks. Our team has gained further expertise with certification program.

Also this quarter, we have been busy with several launches in the area of cybersecurity, IoT and cloud services. The security orchestration automation and response service facilities, faster action in the event of cyber attack, forensic services enable an understanding of the underlying weakness in a cyber attack, along with the action plan.

In IoT, the Turkish digital facility -- sorry, Turkcell digital facility with diversified services and reached serviced copilot as well as new user experience on Turkcell Cloud were amongst other highlights of the quarter.

Next slide. Third is our Techfin focus. Total Techfin services revenue were TRY 223 million, despite the continued contraction in finance sales revenue due to the regulatory limitation. Paycell's growth was robust at 53% on a year-on-year basis. It has been yet another successful quarter for Paycell. With its active user reaching 5.3 million, mobile payment transaction volume has doubled year-on-year. Furthermore, the volume of business realized through the Paycell Card was 4x than of last year. As to handset sales, while there is contraction in the market due to regulatory limitation as well as the pandemic, we observed that some demand has shifted to cash sales over the past 2 years. As we've said, we are also relevant in cash sales through our sales channels. Financell in its fifth year has diversified its focus to cover new segments, including residential, SMEs and corporates in addition to consumer.

Financell is the market leader in the finance sector, including banks, with a 25% market share in consumer loans below the TRY 5,000 threshold. At Insurtech, our subsidiary Güven-Cell product portfolio, including insurance for devices, women health and accidents is now available through our digital platforms. We believe that the Insurtech business complements our tech and service portfolio well. In March, Güven-Cell begun to offer unemployment insurance that ensures Turkcell's subscription for up to 6 months in case of unemployment.

Next slide. Now a few words on our performance through our digital channel. There were 32 million visits per month to our website. Our digital application had 23 million 3 months active user. Overall, the conversion of visit to actual transaction was 1.7x than over the previous year. In particular, data plan purchase and Turkish lira top-up transaction volume over this platform were even higher at 3.7x. As an update to our tech and electronic marketplace, our customers can now easily see and access Pasaj through our digital operator application. Pasaj has gained pace in expanding its portfolio and a reliable supplier base. Overall, with a 9 percentage point increase, the percentage of the customers' sales of Turkcell Turkey generated on these digital channels has reached 15.7% in this first quarter -- in the first quarter.

Now let's take a look at our performance in the international markets. Turkcell international revenue comprising 9% of consolidated revenue, grew by around 27% year-on-year in the first quarter, mainly of strong growth in Ukraine operation as well as the positive impact of currency movements. Lifecell Ukraine revenue grew by 20% in local currency terms. This was driven mainly by subscriber base growth, price increases and higher data usage despite the hit on the roaming business. Its 3-month active mobile subscriber reached 8 million on approximately 7% growth. Lifecell positively contributes to group performance with its increased net income and cash generation ability.

Next slide. Before I finish my part, I would like to touch upon our action on the ECG front. On the environmental front, we have committed the energy use exclusively from renewable source before 2030. We are confident that we can achieve this target which we recently also shared at the GSMA Mobile Net Zero event in late April. On the social investment front, we are glad to have become the sponsor of Turkey's women's national football team. Also, given our responsibility regarding wider digital inclusion, we are building technology rooms in nursing homes for the elderly. Also, starting in Q1, we have put into practice our flexible working models, shifting to remote working for a good.

By doing so, we aim to increase overall productivity, also contributing to our sustainability targets. Further, we have continued working on new projects that aims to increase the number of women in the Turkcell Group workforce. On the governance front, as I believe all of you may have noted, we have our annual general assembly on the 15th of April. With the appointments made at the meeting, all seats on our board are now filled in line with corporate governance principles. A dividend of TRY 2.6 billion have also been approved at the same meeting. The first installment of which was distributed last Friday.

I will now hand over to Osman for a look at financials. Hope you all safe -- stay safe and healthy. Thank you.

[Osman Yilmaz, executive]

Thank you very much, Murat. Now let's take a closer look into our financials. This was a strong quarter for our company. With a 17.5% growth, we generated TRY 7.8 billion in revenues. While the pandemic still poses few challenges, our diversified business model, coupled with strong operational performance in our core telecom business have been instrumental in this performance.

Group EBITDA reached TRY 3.3 billion on an 18% growth, indicating 42.2% EBITDA margin. On the back of robust operational profitability and prudent FX risk management, we generated TRY 1.1 billion net income, it is 27% yearly growth. Overall, we are on track with these results towards our full year targets.

Next slide. Before I dive into our revenue breakdown, I would like to briefly explain the changes in our reporting under IFRS from Q1 onwards. First and foremost, we now report Techfin business as a new segment, reclassified from the segment called Others. Techfin business include our consumer finance company, our payment services company and our Insurtech company. By doing so, we aim to monitor the overall performance as a whole and separately as the segment have different dynamics than our core business.

Secondly, consumer operations of our subsidiary, which includes retail channel operations, smart devices management and consumer electronic sales through digital channels have been reclassified in the other segment from Turkcell Turkey. Other segment also comprises the non-group call center operations and our energy business. This presentation will enable us to crystallize the performances of our core telecom operations and complementary relatively lower margin and growth businesses. I should highlight that these changes have no impact on our operating profit, bottom line or the cash flow statement.

Next slide. Now some details on our revenue and EBITDA development. This quarter, the increase in revenues was by TRY 1.2 billion, TRY 700 million of it was from Turkcell Turkey. Larger subscriber base, rising data and digital services consumption and price adjustments were instrumental in Turkcell Turkey's performance. Turkcell International revenues rose by 26.6%, contributing TRY 150 million in this quarter. Lifecell Ukraine's strong growth was the main driver in addition to the positive impact of currency movements. Under Techfin, finance sales revenue decline was compensated by the $34 million revenue contribution from Paycell. Other segments contribution of TRY 350 million was mainly through the increase in equipment revenues accelerated by the presence of our digital channels. Strong revenue growth has been the key driver for the 18-point rise in EBITDA. With higher equipment sales, EBITDA margin remained flat.

Next slide. Now I would like to talk about our balance sheet and leverage details. As at the end of Q1, our gross debt position increased to TRY 25 billion from TRY 21.6 billion Q4 end due mainly to currency depreciation and new borrowings. In Q1, dollar appreciated by 13% and the euro by 8.5%. Currency movements resulted in around TRY 2.5 billion increase in total debt. Our cash position increased by TRY 1.6 billion to TRY 13.5 billion in Q1. This increase was mainly driven by new borrowings and FX movements. Meanwhile, our free cash flow generation was impacted by seasonal working capital needs. This mainly included TRY 400 million wireless usage tax payments and advanced payments to our vendors, reducing payables balance.

Vast majority of our cash remains to be in hard currency. And this cash is sufficient to cover our debt service until 2025. As of Q1 end, group net debt was around TRY 11.4 billion with a 0.9x leverage ratio. Excluding the Techfin business, this was at 0.8x.

Next slide. Now some highlights on our foreign currency risk management and liquidity strength. Our balance sheet is strong with some $1.6 billion equivalent cash in hand with a long FX position of around USD 200 million. With hedging instruments in place, the share of FX debt declined from 81% to 44% at the end of the quarter. These hedging instruments have limited the net FX loss with TRY 276 million, which would have been TRY 1.6 billion otherwise. As the main reason of our borrowings, I would like to share some details regarding our CapEx.

Overall, around 75% of our operational CapEx is in foreign currency. And for 2021, we have planned to invest around 90% of our CapEx in mobile and fixed infrastructure. We deem continuous investment in our infrastructure to meet rising demand for data and to reflect the technological advancements crucial. Superior network quality is 1 of our key strengths that we are committed to keep in place. In particular, by the rising demand for mobile data, our target to increase our fiber home base by 500,000 and continued demand for our data services -- data center services and digital services are the underlying reasons for the accelerated CapEx budget for this year.

Next slide. Let's take a closer look at our Techfin company's performance and first Financell. In the first quarter, Financell revenue declined by 20% to TRY 130 million, mainly due to lower consumer loan portfolio, along with lower average interest rates. Its EBITDA decline was lower, resulting in 4.5 percentage points rise in EBITDA margin. This was driven mainly by the cost of risk improvement with better credit scoring, successful collection performance and sale of doubtful receivables. Accordingly, the cost of risk ratio declined to 1%. Even excluding NPL sales, cost of risk would still be below 2%, the lowest in 3 years.

Net income increased by 51% year-on-year to TRY 95 million, driven mainly by lower FX loss after hedging. Next slide. Paycell registered a remarkable performance in Q1, achieving 52.6% year-on-year revenue growth. With a focus on expanding its business, Paycell concentrated its efforts on growing non-group driven revenues. Accordingly, non-group revenues rose 81.4% year-on-year this quarter. Paycell's growth was positively impacted by the increasing demand for e-commerce and digital payments. Paycell was able to monetize this demand with its mobile payment solutions, particularly direct carrier billing and e-money solutions.

Mobile payment transactions volume more than doubled, while transaction volume through Paycell Card is nearly 4x that of last year. The number of active Paycell cards is nearly 2.5x of last year's and reached to around 560,000. Paycell's 3-month active users reached 5.3 million. The rise in active users was driven mainly by increased digital content consumption and expanding merchant channel and ease of use of the Paycell application. Paycell is now accepted at 13,000 merchants as at the end of the quarter.

Paycell's EBITDA rose by 46% year-on-year, resulting in an EBITDA margin of 54%. The strong operational performance resulted in a robust net income rise of 41% to TRY 40 million. Paycell will continue its strong growth in the upcoming periods through further penetration and service diversification. This concludes my presentation. We can open the line for your questions. Thank you very much.

[Operator]

[Operator Instructions] And the first question is from the line of Ece Mandaci of [indiscernible] Securities.

[Ece Mandaci Baysal, analyst]

Thank you very much for the presentation and congratulations on the strong results. I have 3 questions. One is on the prospects regarding revenue growth in consumer segment going forward. Since the inflation trend has changed in Turkey, should it be -- would it be fair to assume a higher ARPU gross generation in the [indiscernible] This is my first question.

Secondly, could you please, if it's possible, give more information regarding the breakdown of digital service revenues? Is it fair to assume that now this application has a higher revenue share in overall? And thirdly, last week, there was the comments of the Chairman of ICTA regarding the 5G tender in 2022. Could you please also provide any comments about your view on the potential tender going forward?

[Murat Erkan, executive]

First of all, for the question regarding ARPU and higher ARPU, in the upcoming quarters, we aim to improve our ARPU growth to double-digit level. And we expect the inflation to decline towards the end of the year. We believe that the gap between our ARPU growth and inflation will be contracting. In a challenging macro environment with a high inflation and rising unemployment, we will be targeting a balanced revenue growth through ARPU increase and customer additions. Moreover, as part of our diversified business model, we will also focus our strategic focus areas, which will be supporting our top line growth. Especially, I would like to insist on the first quarter is not apple-to-apple in terms of roaming because last year, there was roaming revenue after the pandemic. This year, there is no roaming revenue. This also impact the ARPU growth level as well. Regarding the breakdown of digital service revenue, to be honest, the biggest share is TV business. So we have TV, music, lifebox and BiP, our main driver of the revenue side, but the biggest share is in the TV side.

Regarding 5G tender, so we don't have official road map announced by the regulation yet. And a couple of days ago, the Deputy Minister of Transformation and Infrastructure said that they are planning to hold a tender in 2022 and commercial services to be launched in 2023. On our side, we have been continuing our preparation for 5G for the last couple of years. We have conducted tests through collaboration and network vendors and other people.

We are seriously taking an active role in international organization, setting the standards. We are focusing on different use cases of 5G, reaching up as many vertical sectors as possible while maintaining local R&D focus. With this scope, we're testing 5G heavily and real time, this virtual reality cases, 5G, live TV broadcasting and other tests are conducted. So we believe that digitalization is vital for Turkey's sustainable economic growth. Going forward, we will continue to provide fast and best-in-class technology for this purpose. But still, it's not that clear for our side. So 2003 seems the service time line. I hope I answered all 3 questions.

[Operator]

Next question is from the line of Ivan Kim of Xtellus Capital Partners.

[Ivan Kim, analyst]

Three questions maybe for me too, please, quickly. So firstly, can you talk about the key NPS drivers for you? So what are the reasons your NPS is stronger than rivals and -- for the ga to increase even though you keep increasing prices? And then secondly, can you please talk about the fiber rollout plans? The plan for this year is clear. But longer term, do you still aim to do sharing or your decision is pretty much to do-it-yourself now?

And then finally, can you please talk about the opportunities to monetize BiP because it looks fairly kind of very good scale now. So probably there is opportunity to get more revenue from there.

[Murat Erkan, executive]

So first of all, for drivers of NPS, there are 3 areas. One of them, our segmented customer centric strategy. We focus our customer based on young, premium and booming and other loyalty services. So customer appreciate our focus on the segmented side. Obviously, we invest a lot to our smart network. So we have widest, fastest, smartest network. So this is appreciated by the customer. And also, our widest distribution network, I mean, sales channel. We are not just selling product. We are doing services and supporting our customer to utilize technology. So I believe all 3 led us on the NPS side. Regarding fiber rollout plans in longer term. So for this year, we hope to see 500,000 home pass. Next 3 years, we would like to continue 500,000 even more than that next couple of years. And we see that we have a demand-driven approach by regional focus in terms of CapEx management. And as long as demand is there, we will continue to invest in fiber. And the 500,000 is the minimum per year next 3 years, I believe.

Regarding third question, I couldn't catch the third question. Could you repeat the third question?

[Ivan Kim, analyst]

Yes, yes, sure. On the third question, just opportunities to monetize, BiP, the messenger. Because for now, I believe there is not a ton of revenue coming from it. But now with a lot of connections that you saw in the first quarter. So maybe you can consider monetizing it more.

[Murat Erkan, executive]

Okay. Obviously, BiP, we have been investing BiP in terms of monetizing BiP. Our approach is a little bit different than the OTT players, other messaging platform because we are utilizing telco capabilities into our infrastructure. So in our BiP with a different way of approach, we can monetize it through the voice, on-net, off-net utilization with services on top of it. And obviously, we can converge it to our Paycell capabilities with BiP integration, customer approach as well.

So I think we have number of cases to monetize the BiP and above. We are also looking for opportunities with the international operators, for going market together. Since we know how to deal with telco approach, there are telcos around the world who can utilize BiP as if their instant messaging platform, with a white label approach. Also, we are looking forward to stake for sales to other operators, other potential stakeholders as well.

[Ivan Kim, analyst]

Great. They're actually integrating it with BiP was the most promising.

[Operator]

[Operator Instructions] And the next question comes from the line of Kayahan Demirak of AK Investment.

[Kayahan Demirak, analyst]

I just have a follow-up on the ARPU growth maybe. A few questions. On the postpaid ARPU, I mean, you had very strong net additions on the postpaid side for the past, maybe more than a year, which seems supportive to blended ARPU growth, but it seems like this impact now is fading away. So what I'm trying to understand is that how dilutive is the new postpaid additions in terms of price compared to your average postpaid ARPU. So on a like-for-like basis, maybe is it possible to give a rough number for the postpaid ARPU growth, excluding the new additions? And also to explain this trend, I mean, do you see some kind of a transition to lower-priced packages within your subscriber network?

So in essence from different ways, what I'm trying to understand the reasons behind the relatively weak growth in the postpaid ARPU. And also as -- again follow-up, this brings me to the inflationary pricing strategy. Now there is a significant gap between the headline inflation and the ARPU growth, 8% versus 18%, 17%. So -- I mean, how much do you -- this divergence to close? Also, are you basing your price increases, I mean, based on your year-end inflation prices? We have any targets on that side that we can share?

[Murat Erkan, executive]

Kayahan, thank you. First of all, our postpaid ARPU is still impacted by the roaming revenue. Due to travel restrictions, some of our revenue source like add-on data packages, constant revenue, overuse charges and -- also impacted during the quarter. Moreover, as you know, we also focused on switching prepaid customers to postpaid subscription. While these switches have positive impact on blended ARPU, they negatively impacted postpaid ARPU as the subscriber firstly choose entry-level postpaid packages. One of our strongest part is [indiscernible] we have ability to grow and set up to higher packages. So a strong postpaid acquisition also had an impact on postpaid ARPU performance as well.

Our like-for-like postpaid ARPU growth was 8.4% in the first quarter. So I think as for the compression of our ARPU growth and inflation, we started the year by adjusting our price. Yet we cannot see the full impact of those price actions immediately due to the contracted nature of our business. Furthermore, we also observed that people in Turkey now are more concerned regarding their purchasing power as well as job security. Therefore, it's more difficult to make material price adjustment in this environment.

On the other hand, due to the current macro environment in the first quarter, we saw a quick rise on the inflation side, which was beyond our expectation. All in all, these factors widened the gap between our ARPU growth and inflation in the first quarter. But we see that we're going to recover this growth level coming quarters. I'm not sure that we can meet at like 17% level. But as you know, we would like to come as close as possible.

[Kayahan Demirak, analyst]

Understood. Just to make some remark on that. I mean, inflation is the 1 side of the equation. Also, how do you think of the FX side. I mean, the other substantial CapEx needs on the USD front, which related -- part of it related with your mobile business. Also, the long-term even FX. So I mean, given the pricing, so how do you pay the FX size into account? Or are you considering that cost pressure coming from that side?

[Osman Yilmaz, executive]

Okay. Thank you very much. The FX is a very important factor, especially in the telco business. But we are well prepared. Actually, living in Turkey and operating in Turkey make us quite cautious on the FX side. So our FX part is well hedged at this moment, plus, we see that FX might impact our investments. So we make our investment earlier than the plan. So this also help us to manage this FX situation. So far, the FX is under control. We don't hope that FX will increase dramatically. So this is in our guidance and in our plan, the existing situation on the FX side.

[Kayahan Demirak, analyst]

And just 1 final quick question. About the asset monetization, you were hoping to see some development on the Superonline site this year. That still stands?

[Murat Erkan, executive]

Yes. It is not just Superonline, but Superonline is also 1 of the assets that we would like to monetize. But because as we shared in our 2020 year-end conference call, we continuously evaluate asset in our business portfolio for strategic action in order to maximize value for our shareholders. Among those assets, Superonline stands out as the best candidate for an IPO, given the size and growth potential. At this point, we are at exploratory phase regarding a potential IPO.

However, we should note that market conditions are quite critical for an IPO decision. Currently, we absorbed strong demand to IPOs in Turkish market, yet, the demand is mainly coming from local retail investors. The size of those IPOs are also relatively small compared to Superonline. For a sizable potential IPO like Superonline, the interest of international investors is also important. Therefore, foreign investor appetite to the market would be one of the critical -- one of the criteria that we're going to consider.

[Operator]

[Operator Instructions] Ladies and gentlemen, there are no more questions at this time. I would now like to turn the conference back over to Turkcell Management for any closing comments. Thank you.

[Murat Erkan, executive]

I would like to thank everyone who joined the conference call. I hope we're going to meet with a healthy condition next or coming quarters. Thank you very much. Good morning, and good afternoon again.

[Ali Yagci, executive]

So ladies and gentlemen, thank you very much. This is the end of our call. Thank you all for taking the time to participate in the call.

[Operator]

Ladies and gentlemen, the conference has now concluded, and you may disconnect your telephone. Thank you for calling, and have a pleasant evening. Goodbye.