Wizz Air Holdings PLC

LSE:WIZZ

Earnings Call Transcript 2020-Q4

[Operator]

Welcome to the Wizz Air 2020 Full Year Results Call. [Operator Instructions]Just to remind you, this conference call is being recorded. Today, I am pleased to present József Váradi, CEO; and Jourik Hooghe, CFO. Gentlemen, please begin your meeting.

[József Váradi, CEO & Executive Director]

Good morning, everyone. This is József. Thank you for joining this call. This is kind of an unprecedented format of delivering results, but these are the times we are in. As a matter of fact, Wizz Air delivered record revenue and net profit. Maybe nobody is interested anymore about the performance of the last financial year, but actually, we had a pretty good year. Revenue grew 20%. Net profit grew 30% and we expanded our margin performance. The improvement came in on the basis of very significant asset revenue growth. We grew those revenues by 14% per passenger and also on a very strong cost performance, ex-fuel costs came down 1%. And you recall that this is sort of the guidance that we had been giving to the market that we would be expecting ex-fuel costs to decline. Obviously, we don't fully control what happens to fuel, but what we can control, actually, we have performed very well. We are one of the very few airlines maintaining investment-grade -- maintaining the grade that we used to have. Moody's just reconfirmed our investment grade. And obviously, this is on the basis of the prospect of the business on a very strong balance sheet, to weather the storm short term. And we are very proud of it, and we do everything we can to maintain our positions to an extent possible. We have taken a number of actions during the course of the last few months to minimize cash burn. Essentially, we are managing the business for cash. We have been always managing the business for cash but particularly given the times we are in, we are much more focused on cash, and we have taken all possible actions to minimize cost and resulting cash burn. We've acted on organizational matters. We've acted on business matters. We've acted on supplier payment terms to make sure that we are in good position to weather this storm. At the same time, we are very keen on ramping the business up again. We are the airline leaving the markets last and coming back first. And I think that's what you should be expecting from a balance sheet, what we have and you should be expecting it from the cost leader of the industry where we are at right now. And we have some encouraging signs of demand. We will elaborate on that. But also we are seeing some significant restrictions imposed by governments that are holding demand back. With that, I would move to the next slide. And this is just to give you some background on how the business is doing as we speak. So we cut capacity already in March by around 1/3. April was the worst month of the airline in history: 97% of our capacity was grounded. Some improvement in May. We opened up the business, but still 93% of our capacity was grounded. Obviously, as the rest of the industry or most of the industry, we also have suffered from ineffective hedges, causing EUR 64 million of losses during the March-May period. We have taken actions on the optimization. I mean clearly, the grounding has resulted in unproductive staff in the business. Even if we were to restore the schedule in full completion for the second half of the year, we would need less pilots and cabin crew simply because we have lost a lot of productivity in the first half -- first half of the year through the grounding, but some of it can be gained back in the second half. And we acted on this by reducing the workforce by 19%. And also, we have cut compensation by 14% on average. Compensation of officers and the Board of Directors got caught by 22%.Having said that, we remain quite positive with regard to the longer-term outlook of the business and our ability to take advantage of the situation and to take advantage of market consolidation following COVID-19. As a result, we have maintained our commitment to taking deliveries of our order book with Airbus. I think we must be probably the only airline, but certainly one of the very few on the planet that continues to honor the contractual commitment with Airbus. And we don't do that for honoring contractual commitment. We do it because we've been seeing that the following market consolidation will spring significant opportunities for Wizz Air, and we have already acted on some of those.We have been also quite creative in this period, and got into rescue flying and medical cargo flying. All together, we have performed around 130 flights. Over all these flights, flying medical cargo from China to Hungary, mainly which is, of course, an irregular operation, and we don't plan to maintain our cargo operations in the future. But we thought it was a good way of helping our countries, helping our societies, contributing to the resolution of the medical issues we all are facing, and at the same time, remain operational. Also, we have done quite a number of repatriation flights, even flying to the United States twice, with 3 aircraft which, I would have never thought we would do. We have an interest in ramping up operation to any extent possible. And I would say that we are pretty much operating whatever we can. And based on our demand sensing, we believe that the desire to fly of customers is there. People want to move, especially after having been locked down for 2 to 3 months. But it is more the restrictions imposed by governments that are the limiting factor to flying. So we're seeing that as restrictions are getting eased, at least in certain countries, that should help us stimulate demand in a much more robust way versus what we are able to achieve now, and we will give you some guidance on what capacity we think we're going to be able to fly.So moving on to next slide. This is giving you an overview on the current state of operations so the footprint of the network. We carried 40 million passengers in the last financial year, with a fleet of 121 aircraft as we speak. Today, we have 122. We took delivery of an aircraft a few days ago. We have a network operating 155 airports across 25 bases in 45 countries. And just back to COVID-19, I can tell you that one of the difficulties is the sheer complexity folding out of the other various government restrictions in play. So in the 45 countries, we operate, there are no 2 countries imposing the same restrictions, and as a result, it's almost impossible to cut through this jungle of ever-changing regulatory restrictions. [ It's not easy ] to fully understand what is going on here. If you move on to the next slide. This is showing the strength of the business measured on market share and market positions. As a matter of fact, in the last financial year, Wizz Air became a better airline, a stronger airline, a more formidable competing force. We've got 40% of the low-cost airline capacity share in CEE, which was an increase of 1 point. And as you can see, in 55% of our markets, we are the leading low-cost carrier. In 45%, we are #2 or #3 and where we are the leading low-cost carriers, actually, we are, in many cases, the single largest airline of the whole industry. So the business has been going from strength to strength. And even today, operating under very difficult circumstances, clearly, we have demonstrated our ability to be very resilient and still be focused on the purpose of the business, flying people, flying passengers to any extent possible. Given the context of Central and Eastern Europe, Wizz Air is the most operational airline. As said, we've been the first to come back to our markets and last to leave those markets and we had to. We had no other choices, and we are very eager to restart in every one of our markets and ramp-up operations to any extent possible.And with those headlines, I will turn it over to Jourik, who will take us through the financial results.

[Jourik Hooghe, Executive VP & Group CFO]

Thanks, József, and good morning, everyone. It's my pleasure to speak with most of you for the very first time. So on Page 7, let me give some color on the financial highlights for fiscal '20. You'll see that the company has delivered outstanding market-leading results across all metrics. Starting with revenue. Revenue increased 19%, reaching EUR 2.8 billion, as said, driven behind strong ASK growth as we expanded the fleet to the 120 aircraft, as mentioned by Joe, and that also resulted in 16% passenger growth. And what makes this even a stronger performance is that whilst we drive really capacity and passenger growth, also, our unit revenue increased 3%. Reported profit more than doubled to EUR 281 million. A big part of that, of course, is due to the changes caused by IFRS 16 in the base year in 2019 and to really see the underlying performance, we need to look at the underlying profit, which increased 30% to EUR 345 million despite COVID's impacting us for a good month, resulting in an underlying profit margin of 12.5.%.Now given that we didn't use the underlying profit term most recently, let me briefly explain that for F '20, the difference between the underlying and statutory profit is only driven behind the EUR 64 million worth of ineffective fuel hedges that Joe also mentioned in the beginning. Those hedges relate to the period of March, April and May 2020, and they became ineffective, of course, because of COVID-19 as we no longer contracted that tonnage.The reason, of course, again, is the grounding. And as said, the delta in 2019 between underlying and reported is driven behind IFRS 16. From an operating point of view, both RASK and ex-fuel costs were highly accretive, and we'll talk about that later. And to close off the slide here, I mean, very importantly, in the current times, our total cash at the end of the year was EUR 1.5 billion. Looking at the financial obligations of the company and the cash burn, which we'll talk later this metric also here is putting us top of the airline industry and many industries, for that matter, as we'll highlight later. And it will allow us to really come back strongly as we engage in several opportunities in the wake of COVID-19.Okay. So moving to Slide 8. You'll see a little bit more detail on our revenue performance, which was, as said not only driven behind the passenger growth, but also by the unit revenue growth. And the internals of that are really where we want them to be. It's a terrific performance on Ancillary with 14% growth per passenger, which allowed us to invest back in affordable ticket fares and to really stimulate the traffic, and that's really what we want. So this makes travel, as said, affordable for everyone, and our load factors with that also continued to increase now at 94% for the year, up 70 basis points.On Slide 9, if you continue to peel that onion on the ancillary revenue, you can see that it's now at EUR 31.3 per passenger. It's a EUR 3.7-per-passenger increase, which is higher than the EUR 0.50-to-EUR 1-per-passenger, mid- to long-term goal that we have every year. Ancillary is now 45% of our total portfolio in revenue. Bags obviously remain one of the key Ancillary revenue products. And also in Bags, we had some history, but you can see there's an encouraging increase here. And also the rest of the portfolio, the other 18%, continues to grow very strongly with 15% growth.Okay. Going through -- from Ancillary to our cost, which is another key pillar of our model. As Joe highlighted, we declined ex-fuel CASK 1%. Fuel cost increased 4.5%. You can see that on ex-fuel, we are pretty stable on pretty much most of the line items. We had a slight increase in maintenance, mostly driven behind the way we are in the lease term and the age of our fleet, which aged around 0.7 years. But utilization of the fleet was flat for the year at 12 hours, 12 hours and 1 minute. And this is all despite the 10% drop in Q4 behind COVID-19. So we had very good performance in the first 3 quarters, unfortunately, offset by COVID-19 in the last quarter. We traded over 2019, where we had some benefits on transactional gains on asset sales, but most of that were offset by the decision that we've taken back in April '19 to move the majority of our cash into dollar deposits, which helped our interest income. So all in all, given that we're already the lowest cost provider in the industry, reducing a further 1% is simply a great performance, okay?Next on the fuel CASK, we're up EUR 0.04 (sic) [ EUR 0.05 ] from EUR 1.11 to EUR 1.15 (sic) [ EUR 1.16 ]. And for the avoidance of doubt, this excludes any impact of the ineffective hedges that we mentioned before. On the next slide, we want to highlight once more the strength of our balance sheet. We remain investment graded, as József was mentioning, with Moody's and with Fitch at a time where most of the industry is getting downgraded. These rating agencies, as Joe mentioned, they understand that F '21 will be a little bit of a strange year and off year in terms of meeting certain criteria, but they see the shorter, the midterm and the longer term horizon, definitely in our business, and they know that the liquidity position that we have helps us to carry through the short term and they believe in the model longer term. So on the next slide, you'll see that the different cash actions for the company. We're absolutely focused on this. We reported, and Joe mentioned, the cost savings programs of the company in terms of reductions and head count reductions, so we want to say that those are, by and large, executed now. In addition, we withdrew -- we drew down, sorry, the EUR 300 million facility as part of the CCFF fund, and we added that to our cash balance. So we started April at EUR 1.8 billion in cash. And we remain absolutely on track to stay in line with our burn rate of EUR 90 million per month for the next 6 months until, let's say, end of September and there onwards with EUR 70 million per month. And this is obviously in a scenario where we would operate absolutely not a single flight. So if you do the math, you'll understand that Wizz Air has liquidity well over 12 months and possibly double that in the same scenario of not flying a single aircraft. We also want to underline the last point here on the slide is that we operate the flights today in a cash and in a contribution-positive way. So that continues to lower our cash burn.Now maybe enough about the past. Looking forward, if you see on the next slide, I'll start maybe with some points on F '21, and then I'll hand it over back to József for some further and strategic business perspective as we look ahead. I mean we are seeing strong demands as restrictions are getting lifted and as just mentioned, our flights are contribution-positive. You read and heard that we are taking charge of our own destiny. And we have the financial muscle to do this, and we are deploying the aircraft against significant new market opportunities. And this, while pretty much all of the competitors are retiring part of their capacity. We plan to grow the number of our seats in our fleet by roughly 10%. Those seats are even more efficient than what we had in F '20. On average, we have now 203 seats per aircraft versus 201 in F '20. A321 aircraft will make up 49% of our fleet. Remember, the A321 has 230 seats in the ceo version and 239 in the neo version. It burns significantly less fuel, 16% in the neo version. And the nitrogen oxide reduction is 50%. The noise reduction is 50%. All in all, a cost reduction of around 20% on the neo versus the A320ceo version. So -- and we have more of those coming, not only in F '21, but also in F '22.So with all of this said, unfortunately, we cannot guide with any responsible level of accuracy on the loss that we'll make for F '21 or on the cash levels for F '21. I think you'll understand that in the current context. And now I just want to give it to Joe, which will give [indiscernible] -- other points on view on the capacity and how we'll carry passengers and where we will do that in the next slide. So Joe, back to you.

[József Váradi, CEO & Executive Director]

Yes. Thank you, Jourik. So let's move on to Page 15. I'd like to elaborate on 4 very important matters when it comes to recovering the business from where we are today. Jourik has elaborated on cash and cost measures we have been putting in place. Let me just highlight 2 aspects of that. So as said, we have 2 years of liquidity on hand. If we don't operate a single flight, we don't carry a single passenger in the next 2 years, we are still in business without any capital requirements from government or private investors. And I think that's a very important statement with regards to resilience of the company.Secondly, we remain on investment-grade credit. That is important because we continue to finance aircraft. We continue to take deliveries of aircraft. So we are subject to the financing market and obviously our credit rating [ helped us ] to access capital at reasonable costs even under the current circumstances. But I also want to elaborate on 3 other aspects with regard to both protocol and what measures we have put in place to reflect on the situation when it comes to customers and our crews, what we are doing to recover demand and how agile we are as a business to take advantage of some of the opportunities arising from the current situation. So moving on to the next slide, Page 16. We have actually done quite a bit with regard to addressing consumer concerns possibly out there. But maybe I should just start by saying that flying remains very safe as a way of travel. On a global basis, there isn't a single case we would be aware of that would prove that an infection would've taken place aboard of an aircraft. So no one has been infected by flying, or at least, we are certainly not aware of that. And there's some scientific studies -- have been carried out with that regard with the same conclusion. So by design, flying an airplane is very safe from a health perspective.But having said that, we have enhanced our standing here by launching a new protocol, and we are obliging the wearing of masks by our crew as well as our passengers to maximize the level of protection. We have eliminated most of the touch points aboard of an aircraft, so payment is only possible by credit card. We have removed all tangible items like in-flight magazines to create an even safer environment, and we are distributing for free of charge hand sanitizers, again, to up our standards when it comes to personal health and safety matters.Another aspect of our approach to customers is that we are truly the only airline in Europe, if not the world, that, to take, I think, a very fair and reasonable stand on refunding passengers of canceled flights. So should a passenger choose to get cash refund, we guarantee within 30 days, we actually refund that passenger and we have automated the whole process of refunds. So this is no longer a discretion of the company or it is not subject to workforce constraints like it is the case in many other airlines. This is a totally automated process. So we made a significant investment here. But I think that gives a much fairer approach to the customer.Also, we encourage people to rebook or take a voucher, and should they take a voucher, we up the value of their fare by 20%, so we offer a pretty good deal. And roughly, what we are seeing today is 1/3 of the passengers rebook, 1/3 take [ ferries ] and 1/3 request refund, but we can handle each of these with -- very fairly and [ active interest ] of our customer group. We have a very young and mobile customer group with average age of 36 years. And as you can imagine, this will be the group that we recover first, certainly much earlier than the elderly people. These people tend to be more adventurous, more agile, and they are seeking more adventures and they are naturally more on the move. So with that regard, I think we are very well positioned that we're going to be seeing it quicker and more of a recovery with our customers. Another important matter, [ even now ] which we understand for -- from demand sensing is that essential travels such as visiting friends and relatives is very important, and we expect actually quite a large number of people to start moving immediately as they can. 65%, 70% of people indicate that they were going to travel in the next 6 months and around 30% say that they would actually do that in the next month or 2, so pretty much immediately. And clearly, what we are seeing is that the issue is not the desire of travel by customers. It is much more the restrictions in place, limiting their movements. So actually, we are quite encouraged with regard to our position to be able to recover the trust of the consumer and actually start seeing more and more people flying.Moving on to the next slide. With regard to capacity planning, I need to say that everything that I'm going to tell you now is kind of interesting from a numerical perspective because you are getting some hints on numbers, what you can expect from us. But this is hugely subject to government restrictions out there. And this is something we don't control. And you can see a number of countries going one direction and other countries going in different direction. So if you look at Europe, as we speak today, we started seeing some easing of restrictions coming into play by quite a number of countries, much led by Germany in a way and also by the southern countries opening up markets for tourism in summer.But at the same time, the U.K. is taking a reverse direction by imposing quarantine in the coming days. And we are operating to 45 countries, and there are no 2 countries with the same set of measures in place or the same interpretations of those measures. So it's [indiscernible] to -- with that regard. So within that context, we are expecting to perform around 15% of our capacity in the first quarter, and this is the last month of the quarter going into peak summer. So July-September, we expect to see around a 60% ramp-up and second half would be around 80%, again, subject to government restrictions imposed. Now the 60% going into the next quarter, you may think this is aspirational. I think it is a bit better based than just that. We've already got a few countries, around 3 countries, that are at that level already. So government restrictions have been minimalized. And as a result, the market has become freed and consumers are free to move. And immediately, we are seeing a significant jump on demand.And in terms of load factor, actually, we are quite pleased to beat our average to fill flights. We are at around 70% booked load factor at this point in time. But again, this has been in the context of heavy restrictions in place, and we expect that once those restrictions are removed, we will see a significant jump on demand. Nevertheless, of course, we expect demand to be different in 2020 versus 2019. And that's why we are making a different assumption on our ability to recover. But I guess this is quite a positive picture relative to the balance of the industry. If you look at May, this is the last month. So we were able to operate around 7% of our capacity. Fares up significantly by 22%, and load factor, as said, was around 65%, 70% in that month. A clear shift towards the late market, while previously, we saw 50% of revenue coming in 30 to 40 days prior to travel. Now it is 50% coming in, in the last 10 days. That's a very significant shift in demand pattern. But obviously, we have readjusted our pricing, revenue management algorithms to make sure that we follow through the new booking profile. And a very important principle that we have been very consistent with that we only operate a network that contributes positively to cash. So we don't fly for the sake of flying, but we fly for financial performance still even under the current circumstances. And as Jourik said, that the worst-case scenario for us is that the entire fleet is totally grounded, but any flying, any operation would just be adding to cash and would just be adding to profitability of the business. So moving on to the next slide. We have taken a very agile view on approaching the opportunities as they arise. I mean we clearly see that an increase in number of airports are begging for capacity, and we are one of the very few airlines that actually can deliver growth, can deliver capacity to airports. And this is a sample of what we have done already. We have announced 4 new bases: Milan Malpensa; Larnaca; Lviv, Ukraine; and Tirana, Albania. And if you look at the numbers, this is the announcement of -- or set of announcements for 10 aircraft for new bases. And kind of the way we think about life is that if you resize the existing network, we think we need to trim capacity by around 20%, 25%. And by also taking new aircraft deliveries, we would be in position to redeploy around 30 to 35 aircraft across new markets, acting on rising new market opportunities. And we have started deploying capacity against these opportunities and more to come in the future.And we're seeing that this is a good way of addressing a somewhat weakening demand through the existing network, but by also tapping into new market opportunities and taking advantage of the market consolidation that way by opening new lines of services and new bases.So just last week, we made announcements of 50 new routes through these 4 operating bases and opening some new destination markets as well. So we have a constructive view on life. I think we're going to look through COVID-19. We need to go through it. And I think we've done what you should expect from a good business to do in terms of measures put in place on cost and cash, but also addressing the very issues of the pandemic and consumers associated with that. But also getting very focused on the future and looking at the opportunities as they arise and taking actions against that.I'd like to make a comment on Wizz Air Abu Dhabi on the next slide. Wizz Air Abu Dhabi is well on track to get the airline delivered. Before the end of June, we are planning on launching the airline commercially, so we would start selling tickets for Wizz Air Abu Dhabi. A prior action to it is that we are flying -- starting to fly inbound by Wizz Air Hungary to Abu Dhabi during the [ course ] as soon as the market opens up, and we would still expect the airline to become operational sometime in October. And as a matter of fact, we have been upping our game in Abu Dhabi, increasing the initial fleet size from 3 aircraft to 6 aircraft in the first 6 months because we're seeing that the current situation actually brings bigger and more opportunities to the airline than what we saw before. So we could be more agile and a bit more aggressive than originally planned. And we still have the plan to grow Wizz Air Abu Dhabi to 50 aircraft over the course of the next 10 years.And just a slide to spend on ESG. We have not forgotten ESG. Maybe it has got out of sight a little bit, although we are clearly seeing that some European governments are taking the opportunity, if I can call it that way of providing liquidity to airlines or capital to airlines, too. So that's some of the ESG issues, especially on the environmental measures. I just want to report to you that we are quite upbeat and agile, what we're going to achieve here. With regard to female representation in the company, we are targeting 25% of pilots to be female and 30% of senior management. We are not there yet, but we are on the way to achieve that. We put quite a number of actions in place to make sure that we will deliver this in the next 5 to 10 years. We have a commitment to reduce our carbon footprint by passenger kilometer by 1/3 in 2030. And as you can see on the chart, we have been on a continuous decline on carbon emission over the years and that will continue to be the case. And I would just note that by continuing taking active deliveries, we are going to benefit from new technology going forward as Jourik mentioned. And obviously, that technology gives us the economic benefits of achieving lower unit cost versus aging fleets of our competitors with creeping unit costs. So the season is going to open up in our favor. And this is the same that will apply on the ecological footprint of the airline. So we simply will have a more modern, less environmentally harmful operation and fleet relative to the rest of the industry as a result. And we have put in place an oversight process that now be renamed the Audit committee -- the Audit and Sustainability Committee. So the Board is engaged with ESG matters. So I think we are incorporating ESG as a core corporate governance process in our way of operating the business and the airline. And with that, I would just like to recap the presentation. So last financial year was a record year when it comes to revenue and profit. And it was backed on the basis of very strong ancillary revenue performance as well as a further decline of our ex fuel cost. We maintained the investment-grade. That is important. It is not only an outstanding position in the industry, but it also enables us to continue to tap into low capital cost financing options for new aircraft deliveries. We have taken a number of decisions needed to minimize cash burn. We have shifted focus significantly on managing this business for cash. Obviously, we are cutting costs to any extent possible, and we are preserving cash to any extent possible.Now conditions remain challenging given the travel restrictions and government-imposed restrictions in place. But we're seeing that once those restrictions are getting eased and lifted, we will see a significantly stronger demand we can tap into. And certainly, we know how to stimulate demand. We have the business model to do so. So we certainly can be one of the structural winners and beneficiaries of post COVID-19 recovery. And we have already started acting on new market opportunities, made a number of announcements on new bases and new routes and just reconfirmed the plan for Abu Dhabi.And with those comments, I would hand it over to your questions. Thank you.

[Operator]

[Operator Instructions] Our first question comes from the line of Mark Simpson at Goodbody.

[Mark A. Simpson, Analyst]

Two questions. First off, on the ticket sales that you are seeing now, is there any difference to the Ancillary component of that? Or is that tracking at sort of similar levels, either in terms of euro or percent of revenue? So just sort of interested in that ticket versus Ancillary mix.Second question. We've obviously seen the announcement [ plans ] from Milan Malpensa, also sort of the more flights coming out of Gatwick. Are we seeing a move into more primary airports in Western Europe as the crisis offers more opportunities? I'm wondering if that's a kind of opportunistic or a structural shift that we're seeing in your planning. And then just clarification, I assume that the revised fleet schedule remains ex Abu Dhabi in terms of the planes listed in that sheet.

[Jourik Hooghe, Executive VP & Group CFO]

Okay. Mark, maybe I start. So on the Ancillary, the Ancillary growth, as you've seen, was 14% for the year. It was 8% for half 2 and 6% for the last quarter, which was already impacted by COVID-19. So we continue to see the same trends in the last couple of weeks of bookings. So for now, no change in those numbers.

[József Váradi, CEO & Executive Director]

Okay. So with regard to Western European operations. Are we structurally shifting focus? Absolutely not. We remain focused on Central and Eastern Europe, and we expect that the future growth of the business will mostly happen in Central and Eastern Europe. So I would expect that at least 50%, if not more, of the gross capacity we've deployed across the markets of Central and Eastern Europe. But as we have said before, we would be somewhat opportunistic going west and we would be somewhat opportunistic going east. A good example is, historically, the opening of a [ Wizz Air base ], with Luton base and the Vienna base going west and now making a commitment to the opening of Wizz Air Abu Dhabi going east. While the western direction is largely motivated by market consolidation opportunities, the eastern direction would be operated more -- the regulatory framework changes, accessibility of markets. So I don't think you should be expecting us to change dramatically or to shift focuses. And I would also say that we are very keen on preserving an operating platform at low cost, even going to Western Europe. And clearly, when airports become desperate for capacity, then most of their incumbent carriers contract capacity, this is the time to bargain, if you wish, and this is the time to secure a cost base on a longer-term sustainable basis. That makes an operation of an airport in Western Europe more effective even if by design, that airport would've been seen as a higher cost operation. So we are very measured on each of these opportunities. So as said, we are not going to fly Western Europe for the sake of flying Western Europe. We have no market share targets. We have no country targets. We are totally opportunistic. If there is an opportunity that presents itself, which makes sense for demand, for competitive dynamics as well as for preserving a sustainable cost base, from our perspective by being a U.S. listed carrier, we will look at it. If not, we won't. So don't worry, we are not changing the fundamentals. We are not shifting the focus of the business. With regard to the fleet composition, that actually includes Abu Dhabi. So we look at the group as a whole, and we look at it seamlessly with that regard. And our fleet will continue to grow as presented here. Actually, we will have a 9% larger fleet in terms of aircraft count at the end of the financial year. And some of it will go to Abu Dhabi. Some of it will get deployed across Wizz U.K. and Wizz Hungary. But we manage the fleet on a group basis.

[Mark A. Simpson, Analyst]

Okay. Just circling back just on the Ancillary component. I just wanted to clarify, in terms of the tickets you are selling currently, you are still seeing kind of similar euro levels of Ancillary. You're not discounting Ancillary to help stimulate demand, so Ancillary is still a key component of your total revenue mix?

[Jourik Hooghe, Executive VP & Group CFO]

Yes. I mean that's correct. I mean, obviously, the volume of bookings in the last couple of weeks is not very material. But our Ancillary growth target is to be EUR 0.5 to EUR 1 up every year.

[Operator]

And our next question comes from the line of Daniel Roeska of Bernstein Research.

[Daniel Roeska, Research Analyst]

Three for me, please, if I may. Number one, how would you view the market disruption currently as an opportunity for further cost reduction on a structural basis? You already kind of commented on the opportunistic opportunities maybe with some of the airports, but where would you see the biggest opportunity for cost reduction outside of your fleet strategy? And then could you elaborate a bit more on your Abu Dhabi plans, kind of how they've changed in the past months? I'm certain you had some intense internal discussions whether to continue or postpone the project in light of the recent developments. And what were the most convincing arguments to -- and to make you continue at the pace you presented today? And then lastly, maybe a little bit more medium term, a short discussion on medium-haul and range. How are you thinking about expanding your average range also for the European operations, especially since you will have thought through some of the traditional obstacles like traffic rights or so for the Abu Dhabi business case kind of in the medium term? Also for the European kind of fleet, could you see longer destinations in bilateral traffic markets as an option for you?

[Jourik Hooghe, Executive VP & Group CFO]

Okay. On the first question, I think if you look at it, I mean, we were operating in a market that across elements, by and large, was potentially constrained and inflationary. So I think you need to almost go line item by line item to really understand the dynamics there. So there's a lot of airlines, unfortunately, having to reduce workforce that will play to our benefit. Maintenance providers, suppliers and third parties that plays to our benefit. Obviously, the big one is the [ commodity ]. We don't know what it's going to do. But so far, I mean, it's been a lower cost. So I think you need to look at some of the bigger dynamics where, previously, we did have inflation that today may actually be less inflationary than what we saw in the past. So that will definitely play to our benefit.

[József Váradi, CEO & Executive Director]

Okay. So I will take your question on the Abu Dhabi matters. As a matter of fact, I don't think it has even crossed our mind that we should be deferring the project. So that's not us. I think that's other initiatives also targeting the UAE or Abu Dhabi. I think we look at Abu Dhabi with the view and perspective that likely the backtracking of the industry and the consolidation of markets as well as a significant contraction of capacity actually ups our game in Abu Dhabi and creates a big opportunity certainly for the start, but even on a longer-term basis. So we approached Abu Dhabi more like how much more should we be doing to take advantage of the situation. And we have been supported all along by our local partner, and we are having the support and energy of the system in Abu Dhabi so we are very encouraged by that. And I certainly think that the whole premise of Wizz Air Abu Dhabi has got reconfirmed by [ all ] parties. I mean Abu Dhabi is strategically diversifying its economy. And we can contribute a lot to that diversification strategy. So I don't think that, fundamentally, anything would have been challenged or questioned here. It's quite the opposite. The question was really asked, can we do bigger and quicker than originally planned. So I think we are very encouraged by that. And you will see that in a few weeks, we're going to be launching Abu Dhabi commercially, and we're going to be bringing some very exciting markets to the franchise of Wizz Air. But looking at it from a consumer perspective, Wizz Air Abu Dhabi's going to be completely seamless. I mean you would not recognize the difference by flying a Wizz Air Abu Dhabi airplane or Wizz Air Hungary or Wizz Air U.K. airplanes. So we remain very integral as a system to minimize complexities and costs, as a result, and execute as simple as possible, and that also applies on Wizz Air Abu Dhabi. So if anything, this brand has just got enhanced. With regard to medium-haul services, over the years, our stage length has been increasing. I don't think we have any target here or we have any ambition here. I think this is just the way we end up it with certain things. And probably, it is because that we have been focused on a central geography at the beginning of the airline's existence. And now we are sort of pushing the boundaries, East and West, and as a result, our [ station ] is growing. But we don't have a target here. I think if we look at the markets, if we look at what consumers want, where we see demand, and we would source the demand with capacity. It could be that stations will continue to increase to some extent. We are not trying to be a long-haul carrier. We are certainly not trying to be a long-haul, low-cost carrier but we are very keen on connecting the dots, being in our geographical footprint. And if you think about it, we are flying from the Canary Islands in Spain to Nur-Sultan, Kazakhstan. So there is a lot of landing between and quite a lot of distance in between where we think we can join the dots and we can add substance to our network. So that's really our motivation here. And with the arrival of the extra aircraft in 2023, then we can further elaborate on that concept. But we don't have a target here. But likely, we will do more. Yes, I think we have an interest in the bilateral market. But again, that interest is measured against the operating cost environment of the market, our ability to scale and to really see through efficient ways of stimulating demand in the marketplaces. But yes, we have a [indiscernible] interest in exploring bilateral opportunities, should operating parameters be right for the business for what we have.

[Operator]

And our next question comes from the line of James Hollins at Exane.

[James Edward Brazier Hollins, Senior Transport Analyst]

Two for me, please. I was just wondering if your data on the cash burn included refunds and also maybe give some detail on what sort of quantum of cash refunds you've been paying out? And secondly, I was wondering if you had any interest or would have any interest in the Lufthansa slots they're giving up at Frankfurt and Munich? And on that point, whether you would go back into Frankfurt, if you get better slots? And perhaps why you pulled out of Frankfurt. If you would like to discuss that, that would be great?

[Jourik Hooghe, Executive VP & Group CFO]

Great. So I'll take the first one. So on cash burn, the EUR 90 million includes all the costs related to crewing, to maintenance, to fuel, to the hedges. To your question specifically, on the refunds, we have refunded around EUR 40 million to date, in line with what József told earlier, given that most of the refunds -- actually more than 2/3 go to either rebookings or to [ these ] credits. But with that, we're actually through the very large majority of our refunds. We have like EUR 10 million to EUR 15 million to go. So we're fully caught up with that. We think it's really important to restore confidence with our passengers. The impact of those actions, we've been able to largely mitigate with the cost and cash reductions that we've been talking earlier. So that will not impact materially the burn rates that we've talked about.

[József Váradi, CEO & Executive Director]

So with regards to Lufthansa slots, are we interested? In principle, yes, we could have an interest, but you need to put things in context. I mean first of all, the magnitude of the remedy, what the EU wants to [ posit ], to offer to the market is that after the remedies, Lufthansa would still own, so to say, 98% of strategic slots at Frankfurt and Munich, and they would give up around 2%. So what kind of a level playing field is it? So I think we need to make an assessment whether or not it makes any commercial sense. And certainly, you would need to look at it from a longer-term scalability perspective, what it really means. So I would almost say that it would need to be followed through with a scalability agreement or something similar that we should be able to get access to growth at the airport. I think that's issue #1. Issue #2 is the cost environment at those airports. If I look at the direct rates available to the market today, I mean, certainly, we would have no interest in operating any of these airports. And the reason we left Frankfurt was the airport's inability to continue to provide reasonable costs for accessing airport capacity. So we are not going to chase high-cost opportunities just because they get freed up by airlines. But we look at this opportunity. I think our interest is significantly conditioned on scalability and cost. If those issues can be addressed effectively, yes, maybe we would further look at it. If not, I think we would just walk away from this.

[Operator]

And our next question comes from the line of Jarrod Castle at UBS.

[Jarrod Castle, MD, Head of the Travel & Leisure Sector and Co]

Three, if I may. I know you gave a bit of color on 2Q in terms of 60% capacity. I'd just be interested to get a little bit of profile as we move through the months, how that would ramp up? You're starting on 40% and then going to 60% and then going a little bit higher, maybe 80% to kind of get to the 60% blended? Secondly, just looking at the appendix, your Jet Fuel, you've hedged 90% and historically, you've tended to be more in the 55% to 60% range. Is that just more opportunistically that you think fuel prices are going up? Or have you changed the thinking about the fuel hedge itself? And then just overall, I mean, obviously, we've seen airlines get financial aid and some of the generally accepted structure of the industry has changed. How would you see the industry now in kind of 3, 4 years' time developing now?

[József Váradi, CEO & Executive Director]

Let me start with the capacity. To be honest, we don't know. And we would be irresponsible to give you a specific plan here. We're seeing that a 60% is achievable based on some empirical evidence. I mean, as said, we have a few markets that have been ramped up already to above 60% of capacity. And once restrictions are removed, I mean, clearly, you see demand coming back quite strong, actually stronger than what you would believe or what we all would believe at this point in time. But this is totally down to the discussions of the government, and we don't control it. But we are assuming here that throughout summer, we will be facing a much better environment, a much more normalized regulatory framework. And most of the restrictions would be eased, especially when it comes to flight bans, quarantine measures and those sort of issues. But we don't have a specific plan here. But obviously, at the front end of the process, it would be less. The back end process, it would be more. But this is really down to these restrictions. And maybe I will take the last question how the industry would look 3 years from now? I think the way the industry looks today is almost like what the industry was 15 years ago. The nation-state is getting involved again. The state is no longer just the governance body, the body that sets the regulatory framework, but they have equity interest in their airlines. And we know what it means, that playing level field gets distorted completely. There is a lot being done in favor of the national carrier when it comes to commercial terms, when it comes to putting up administrative barriers for intruder competitors. So this is not great. I mean this is a significant step back, maybe a few steps backwards. So that's not going to do very well to the industry. And the real issue here is that given the easy financial aid, whether this is liquidity or capital provided by governments. Essentially that preserves many of the inefficiencies faced by these national carriers. So I mean, look at it, I mean, these carriers seem to be the last one to act on labor issues. They seem to be the last one to act on fleet issues. As a matter of fact, they are deferring the expansion of new technology. They cut aircraft orders, so they didn't have an aging fleet and more polluting feed to the environment. So many of the issues leading to their financial distress under difficult circumstances will prevail. So I don't think that these aids are achieving much on a structural basis over the long run. Certainly, these airlines will be kept alive. I mean I would hope that one thing will be achieved that at 1 point, because this is taxpayers money, there would be some curtailment of management egos and CEO ambitions of those airlines caught to some extent that you see these airlines expanding all over the place, wasting a lot of money with subsidiary airlines, with the acquisition of new markets. And hopefully, this is going to be contained. And hopefully, this is going to be somewhat cut back versus what we have seen in recent years. But structurally, this is not going to improve the state of the industry.

[Jourik Hooghe, Executive VP & Group CFO]

And just to close on your question on the jet fuel and any policy changes. I just want to say that the coverage is a result of the contraction of the capacity that we fly rather than us adding in more hedges. In fact, we're quite cautious now, especially in case there would be an occurrence of a W pattern in demand, we wouldn't want to have to pay what we're currently paying in terms of ineffective hedges.

[Operator]

Our next question comes from the line of Rishika Savjani of Barclays.

[Rishika Dipak Savjani, Assistant Vice President]

A couple of follow-ups. Could I get you to comment on the competitive environment that you're seeing, particularly in your Central and Eastern European markets? So are airlines in those markets shrinking by similar proportions to what we're seeing in Western Europe? Is the same amount of government aid being provided? Just interested in some more kind of specific Central and Eastern European color? On your comment earlier about the booking curve and 50% of bookings coming in the last 10 days, do you think that this is the new profile for the rest of the summer? Do you expect that the season will continue to show very late bookings? Or do you think that there will be a shift back to a more normal booking curve as we progress through the season?

[József Váradi, CEO & Executive Director]

Okay. Thank you. Well, with regard to capacity environments, Central and Eastern Europe, I mean, that is -- there is dead silence, to be honest. I mean we haven't seen any significant announcements made by incumbent carriers in Central and Eastern Europe. But there is a state aid involved. Otherwise, these businesses would have been out of business by now. They were very fragile prior to COVID-19, and they've just been losing cash ever since. But it seems to me that governments are making it a -- an essential question to bail out the airlines and they cannot fail as a political force to let the national carrier go, under the circumstances. So my assumption is that these airlines will survive at least for some time, but they will have to restructure and they will have to cut capacity significantly. But simply, Central and Eastern Europe is probably not in a financial position to flood uncounted money and capital into their airlines, while at the same time, these countries are struggling with the medical system of the country and all other major distribution systems. So probably, these countries will have to be somewhat more measured with that regard, but my personal expectation is that the -- in combination, the carriers will be aided by government, but they will restore significantly lower capacity than what they flew before. You have a bunch of private airlines. I think, their clock is ticking. They would need to either get access to capital from government, which is doubtful or from private investors, which is doubtful too. So I would expect that in the next 5 months or so, you should start seeing some significant number of casualties happening across the region. But also, I think that would extend to Western Europe too. When you look at the booking profile, I don't think that this is the new black here. Clearly, this is an extraordinary outcome under extraordinary circumstances. But let's not forget that this booking profile is the result of heavy restrictions imposed on people. As these restrictions are going away, I think, people will slowly but surely move back to normal. So we will see the booking curve expanding towards what used to be normal. But it will take some time, I think, to reach the old normalities. I don't know how long this is going to take. But certainly, the 50% of revenue coming in, in the last 10 days is extraordinary, and it's not going to be there forever.

[Operator]

Our next question comes from the line of Jaime Rowbotham of Deutsche Bank.

[Jaime Bann Rowbotham, Research Analyst]

Three quick ones from me. Firstly, Joe, would you mind sharing which are the countries where you are back at around 60% of previous levels? Clearly, that's something your Western European competitors would be delighted to have at this point in time, so I just wondered if you could clarify? Secondly, to what extent are you monitoring developments with Alitalia in the context of your new base at Malpensa? Does the success or not of that base depend a bit on what happens next with Alitalia? Or does it not really matter? And thirdly, one for Jourik, perhaps. I think I saw an agreement on or around the 8th of May with BOC Aviation, where it was doing a sale and leaseback of 6 A321neos. Are the terms of those sorts of deals proving to be somewhat less attractive than they were pre crisis? Anything you could share would be much appreciated.

[József Váradi, CEO & Executive Director]

Okay. Thank you for your question. So maybe the answer to the first one. I mean the best example we have is Bulgaria. I mean we are at around 65% capacity. Bulgaria has been operational throughout the whole period. In the worst weeks, we were down to around 15%, 20%, but now we have ramped up to 65%. There are still some restrictions in place. But should those restrictions go away, we think that actually there is significantly more to achieve than 65%. And that sort of gives us the proxy. So by seeing how the elimination of restrictions affects the market demand and everything boils down to these restrictions. I mean, yes, I admit that there is going to be overall less demand because as other people, we will travel less. I think business travel will come down because of the recession and because of technology has been figured out for business contact, but the fundamental desire of people to move and travel, I don't think will be curtailed for longer. Even I could argue that because of the lockdown, that actually pushes people more to go now. Because they have been so much within 4 walls that they want to breathe fresh air and they want to go somewhere. And we are certainly sensing it when we are looking at demand and how demand would recover. So with regard to Alitalia, I think Alitalia is kind of the joke of the industry for quite long now for probably 10 years or even more. And there is always a new episode to the Alitalia story. Personally, I'm a little tired of following it, to be honest, and I don't really care what's happening to Alitalia. We have been making a total independent decision based on the market opportunity as it presented itself to us, irrespective of what's going to happen to Alitalia. And by the way, whatever happens to Alitalia today may not stand tomorrow and maybe something else that's going to happen to Alitalia next day. So I think we stop reading that storybook now, which is quite a bit of a fairy tale.

[Jourik Hooghe, Executive VP & Group CFO]

And on your last question, I think you're right. If you look at the macro picture for the industry, there's obviously inflationary pressure on rates, but the industry, as I think, today is the evidence of that is not a monolithic entity. We are different, and we will walk away from terms that are not competitive.

[Operator]

Our next question comes from the line of Andrew Lobbenberg at HSBC.

[Andrew Lobbenberg, Head of the European Transport Team]

Can I ask -- firstly to Europe, what are the key issues on your tray? I mean, obviously, we're managing through the crisis, but when you came -- before it did, and perhaps looking through it, how do you think that you can improve the performance of the finance function within the company? Possibly related to this, last year, the cash bar was moved over to dollars, and that gave us a nice one-off kicker to the interest income line. But now interest rates have come down in America, so should we expect that to go against you this year? And indeed, just what are you thinking about moving cash bars around the world? And then a final question and rather my typical one. How is the EU ownership in control and size? And what is the U.K. within that? And how are you thinking about that as the chaotic Brexit process lumbers on?

[Jourik Hooghe, Executive VP & Group CFO]

Yes. So first, on the company, the finance function. I think my mission is, if you looked at the first slide in the deck, is to just continue what this team has been doing in an amazing way. So that's my key focus. And I want to keep everybody focused very much on that. And I think today, you've seen that the strategic opportunities that were there before the crisis are still exactly the same strategic opportunities that are out there. So it's all about making sure that we can really, really help the business to drive those as much as we can. So that's really the key focus for the function, and I wouldn't want to change that. I think that was well in place. On the rates, you're right. I mean we -- the rates are coming down. The U.S. rates are still very attractive. So for the time being, that remains the right decision. And then on the ownership, the non-EEA ownership is 44%, just below 44% today. So there's definitely a good margin there. And then within that, we have the U.K. at 36%. Sorry, the U.K. is 36% of the ownership.

[József Váradi, CEO & Executive Director]

I would just add to ownership and control because that's the ownership side of it. But if you look at the control side of it, we have just recomposed the Board of Directors to be compliant with the post-Brexit governance expectations. So we have [ EEA majority ] on the Board and the decision-making and governance have been adjusted in accordance with the new line.

[Operator]

Our next question comes from the line of Ross Harvey at Davy.

[Ross Harvey, Transport, Distribution and Logistics Analyst]

Just a few questions on your fleet plans. Firstly, how much flexibility do you have to adjust the net increases in FY '21 and FY '22? And would you like to see any changes? Secondly, how many aircraft will go into Wizz Air Abu Dhabi over those 2 years? And finally, how many of the aircraft deliveries do you have financed already, either with leases or debt?

[József Váradi, CEO & Executive Director]

Oh. Thank you. I mean maybe just a matter of perspective. So we have been in direct relationship with Airbus for 15 years, and we have a mandate to deliver the schedule of our contracts more than 40 times. So I think you need to look at all these contracts and delivery schedules as quite an organic thing that can change and can be adopted and can be accommodated based on the changing environment, and [ remanding ] the [ contracts] that doesn't necessarily mean that we are -- we have been deferring active deliveries. Actually many times, we have been advancing aircraft active deliveries. So with that in mind, actually, we feel very comfortable with '21. And we are also comfortable with '22. I mean we shall see how the world is going to play out following the coronavirus, what recessionary impact we're going to be seeing, how market consolidation is going to play out, and what opportunities we could see as a result of that. But based on what we are seeing today and how we can judge the business, we actually seem quite comfortable with contracted fleet plan, what we have in place with Airbus. With regard to financing, we are just able to complete a few transactions. I mean we are completing these as we speak. And that would finance the next 12 months, the next 15 aircraft deliveries. So we will be fully financed until mid-2021.

[Ross Harvey, Transport, Distribution and Logistics Analyst]

Sorry. And also Wizz Air Abu Dhabi, how many aircraft do you expect to go in there?

[József Váradi, CEO & Executive Director]

We had the original launch plan of 3 aircraft and we kind of doubled down on that, given the situation and the opportunities we are seeing. So now we are looking at Wizz Air Abu Dhabi more like a 6-aircraft launch program. I mean take it like for the first 6 months. So this is not on day 1, but kind of the first 6 months. So that's kind of the magnitude of capacity, what we look at deploying in Abu Dhabi. And obviously, depending how that works out, and what results we are seeing, we're going to be evaluating the growth trajectory going forward. But on a medium, long-term basis, we feel quite comfortable with the basic proposition of delivering a fleet of 50 aircraft over 10 years. If you kind of look at what Wizz Air Hungary, Wizz Air EU airline has achieved in the first 15 years, so basically, it took us 15 years to get to 100 aircraft by Wizz Air Hungary. We think that the size and scale of the opportunity of Abu Dhabi is very similar to what we have achieved here in the EU.

[Operator]

And our next question comes from the line of Najet El Kassir from Bank of America.

[Najet El Kassir, Research Analyst]

Three questions for me, please. The first one is, you would be adding pretty much the same number of aircraft. How much should we expect in terms of net cash outflow this year? And then on the unit cost and unit revenue of Abu Dhabi, are they similar to Wizz U.K. or Hungary? And the last, maybe, are you seeing -- have you been able to renegotiate your leases downwards on the back of COVID-19, please?

[Jourik Hooghe, Executive VP & Group CFO]

So on the first one, I mean, given that we finance our aircraft with sale and leaseback, I would say there is no capital expenditure on our side. So that doesn't impact our cash flows. And the financials of Abu Dhabi, they -- without disclosing too much detail by segment or by region, but by and large, they look attractive. They look to be at least in line with what we have for the rest of the network, given the maturity of the market and the projections that we're making. So that's it. And then on your last question on the leases, I would say, no, we haven't renegotiated lease terms, in general, because those obviously, contractually, are quite solid. We are working with lessors to obtain some deferrals, but we are not willing, obviously, to pay any cost for that.

[Najet El Kassir, Research Analyst]

Just maybe 1 follow-up on the cash outflow. What are the PDPs? I understand it's only sell and lease back. But what are the PDPs that you will be paying out this year, in fiscal year '20?

[Jourik Hooghe, Executive VP & Group CFO]

In fiscal '20?

[Najet El Kassir, Research Analyst]

The fiscal year '21, sorry?

[Jourik Hooghe, Executive VP & Group CFO]

Okay. I mean, as Joe mentioned, we are one of the biggest clients now of Airbus. So it is important that we have a delivery schedule that works for us. And at the same time, that also works for them. So as we're in a very close partnership, we're making sure that we can work on the proposition that works for both sides on that.

[József Váradi, CEO & Executive Director]

So basically, if you look at the numbers today, we have around a EUR 600 million PDP line outstanding with Airbus. We would see a temporary increase in the -- in the coming period, let's say, in the next 18 months or so, and then we would start sort of resuming to normal. But this is something we are managing with Airbus as we speak.

[Operator]

And our final question is from the line of Carolina Dores of Morgan Stanley.

[Carolina Botacini das Dores, Equity Analyst]

I have 3 questions. First, could you disclose on the Ancillary revenues how much is Food and Beverage? And as a follow-up to that, are you seeing a change in the mix of Ancillary revenues? I'm assuming less for the Beverage -- Beverage and more prior to Booking or Bags? And my final question is, when we think about Abu Dhabi, how are you going to report because it's the JV. Are we going to see ASKs and RPKs separated, incorporated as part of Wizz? Or will it be just aligned just below net income?

[Jourik Hooghe, Executive VP & Group CFO]

Yes. Thank you, Carolina. I'm not sure I fully understood your first question because the line went a little bit cracky, but I think you're asking about the Ancillary revenue composition between products going forward? We do not necessarily see a major shift in that for the time being or in what we can project. So that should be relatively consistent, and we hope to grow the full portfolio at similar -- quite similar rates. And then on your second question, and we will be consolidating Abu Dhabi into the group numbers, and then there will be a partnership expense line at the end of it.

[József Váradi, CEO & Executive Director]

You may recall that we have a 70%, 70% percent interest in Wizz Air Abu Dhabi, and ADQ, our Abu Dhabi partner has 30% of the economic interest.

[Operator]

As there are no further questions, I'll hand back to our speakers for the closing comments.

[József Váradi, CEO & Executive Director]

Thank you for your interest. I think you understand that you have a bit of a hard time here to sort of cut through the jungle and fully understand what's going on and what you can expect. What I can assure you is that Wizz Air is standing firm in terms of going through the current crisis and also standing ready and pretty much in pole position to take advantage of what's coming after COVID-19, and we're seeing that there will be some degree of market consolidation and Wizz Air will be one of the structural winners coming out of it. And with that, thank you for your attention, and thank you for your interest. Bye-bye.

[Operator]

This now concludes the conference. Thank you all very much for attending. You may now disconnect your lines.