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Dear, ladies and gentlemen, welcome to the conference call of E.ON SE regarding the presentation of the first quarter results 2019. At our customer's request, this conference will be recorded. [Operator Instructions] May I now hand you over to Dr. Stephan Schönefuß, who will lead you through this conference? Please go ahead.
Thank you, operator. Good morning, dear analysts and investors. A very warm welcome to E.ON's First Quarter 2019 Results Call. My name is Stephan Schönefuß, and I'm here today with E.ON's CFO, Marc Spieker, who will present to you our results followed by Q&A session. Marc, please, over to you.
Thank you, Stephan. Good morning, dear analysts and investors, and a warm welcome also from my side to our first quarter 2019 results call. Ahead of our AGM tomorrow, we will keep it short and crisp today. Compared to an exceptionally high base last year, EBIT in the first quarter was down 8% and adjusted net income decreased by 11%. The decline was expected as earnings in 2018 has been front loaded towards Q1, especially in the Customer Solutions segment. With the first quarter now behind us, we are fully on track to achieve our full year guidance. We also confirm our dividend proposal of EUR 0.46 per share for 2019. Before I dive into the financial details of Q1, I would like to highlight some important points around the innogy transaction as well as provide an update on recent operational developments. The innogy transaction is fully on track. With regards to the antitrust approval process, the EU Commission is now closely analyzing the relevant markets as part of their Phase 2 investigation and, as in that context, formally requested further very detailed information. As we were not in a position to deliver the information in the set time frame, the EU Commission has set the so-called stop the clock for several working days in the designated approval time frame. Let me emphasize that the transaction time line with an anticipated closing during the second half of 2019 holds and that the short interruptions are not unusual for a transaction of that size and geographical scope. In terms of the preparation for the integration of the 2 companies, we are making significant progress. We have designed all future operating models of new E.ON, which include sizing and resource allocation, for all major functions. We're also on track in the senior management selection process. Against this background, I would like to reiterate the net synergy target of EUR 600 million to EUR 800 million by 2022, which is unchanged to our previous communication. After this transaction update, let me give you a brief update on operational highlights in our core businesses. We are very satisfied with our solid performance in Energy Networks. We are progressing well with a disciplined and gradual increase of our network CapEx, especially in Germany where investments have been increased by EUR 60 million to close to EUR 200 million in the first quarter 2019. These investments are targeted towards modernization, digitalization and new connections and has worked towards our objective of long-lasting and ambitious RAB growth. With the exception of the U.K., we can also report operational success in Customer Solutions. In Germany, we managed to grow our customer numbers by more than 100,000 just in the isolated first quarter of 2019. Despite the continuously challenging environment we are operating in, this customer growth gives us confidence in our strong brand, marketing initiatives and excellent customer service capabilities, which are yet another proof of the performance culture inherent in our DNA. In this context, I would like to emphasize that those new clients are profitable customers. We are not aiming for market share at the expense of profitability. In Renewables, we are well advancing on our capacity growth paths. In Q1 this year, we have started construction on 2 new wind farm projects in Texas, Peyton Creek with 151-megawatt and Cranell with 220-megawatt, which shall be commissioned by the end of 2019 and beginning of 2020, respectively. Now let me focus on the financial performance in the first 3 months of 2019. EBIT in the first quarter of 2019 came in at EUR 1.2 billion, which was a decline of roughly 8% compared to the very high base the same period last year. Key driver of the decline was the EBIT in Customer Solutions, which is down more than EUR 170 million compared to last year's first quarter. In 2018, earnings in Customer Solutions in Germany and U.K. were more front loaded than usually, thus we expect a more equal distribution of quarterly results in 2019. EBIT in Germany declined by roughly EUR 70 million year-on-year, mainly due to higher network charges since the beginning of the year. Higher gas procurement costs and warmer weather in the first 3 months also added to the decline. We have already implemented first price increases effective as of April. Impact on customer churn has been negligible. For that reason, we are confident to recover the negative impact from the first quarter during the remainder of the year in order to deliver a 2019 EBIT on comparable level to 2018. You may recall that we had a similar development back in 2017 when we also made up for a steep decline of results in Q1 during the remaining 3 quarters. In U.K., EBIT dropped by almost EUR 90 million compared to the same quarter last year mainly as a result of the introduction of the SVT price cap. The situation in the U.K. remains difficult as the price increases in the SVT tariff imposed by Ofgem have somewhat decoupled from wholesale price developments. Prices for SVT tariffs have been raised in April, with also power prices declining for the -- for sometime. As a result, market churn rates have increased. To our dissatisfaction, we have been losing more than 200,000 customers in just the first quarter of 2019. Despite a very negative customer development, our U.K. team is fully on track to deliver a clearly positive EBIT in 2019. We will work even harder in order to convince customers of E.ON as a sustainable energy partner. Earnings in Energy Networks are down by just EUR 20 million compared to Q1 2018. In our German network operations, the positive effect from a higher regulated asset base and the excellent efficiency scores compensated for the lower return on equity and the new regulatory period. In Sweden, we continue to benefit from already implemented tariff increases, by the weak Swedish krona, the storm Alfrida at the beginning of the year, and the divestment of our guest network in Q2 2018 had a compensating effect. Furthermore, higher allowed revenues in Czech Republic and Slovakia on the back of high investment levels compensated for the lower allowed returns in Romania. Operating profit in Renewables is up 23% in the first 3 months of 2019. The positive contributions from our offshore wind farms Rampion and Arkona and additions in onshore were partly compensated by the end of support schemes in onshore U.S. and Italy as well as a decrease in U.K. market prices. Earnings of our Non-Core Business increased by more than EUR 50 million year-over-year. With PreussenElektra, higher hedged prices overcompensated higher depreciation charges and the non-reoccurrence of a positive one-off effect in the first quarter last year. In addition, the result of our Turkish generation business increased on the back of operational improvements mainly caused by higher hydro volumes and U.S. dollar-denominated hydro feed-in tariffs. Let's have a look what all this means for our bottom line. Our adjusted net income came in at EUR 650 million for the first quarter of 2019, down 11% over previous year. The financial line is roughly unchanged compared to previous year. Improvements in financial expenses resulting from maturing of high-coupon debt instruments in '18 are compensated by higher financial charges as a result of the first-time application of IFRS 16. Let me now turn to the development of our economic net debt. Economic net debt increased by more than EUR 2 billion over the end of 2018. This is mainly due to a seasonally low cash conversion in the first quarter. Higher energy consumption during the winter period in our retail sales business as well as seasonal patterns in the redistribution of feed-in tariffs for renewable generators resulted in an anticipated temporary increase of our working capital. We expect these seasonal effects to be offset during the remainder of the year. We continue to see a cash conversion rate of over 80% for the full year, in line with our guidance. Furthermore, pension provisions increased by roughly EUR 200 million over year-end 2018. As pointed out in our full year call, we've seen a significant recovery of our plan asset performance in Q1 compared to year-end, which is reflected in the value of our pension assets. Unfortunately, the interest rate environment has changed, and interest rates in Europe went down significantly. As a consequence, we had to lower our discount rates for the pension provision significantly, 30 basis points in Germany and 40 basis points in the U.K. The lower discount rates led to a more than EUR 800 million increase in the pension provision during Q1. According to international reporting standards, we have to revalue our pension obligations quarterly. This is a pure technical accounting effect that does not have any impact on the cash-out profile of our pension liabilities. Thus, we are not overly concerned about the development in a single quarter. Another major effect resulting in the economic net debt headline increase is the first-time implementation of the new accounting standard IFRS 16, which has been reflect already at the full year results call. The effect of the reclassification of leases increases economic net debt by roughly EUR 800 million compared to year-end 2018. Roughly EUR 300 million of this increase relates our Renewables operations that will be transferred to RWE. From a ratings perspective, though, the increase in economic net debt as a result of IFRS 16 has no impact as the rating agencies already in the past regarded E.ON obligations as financial liabilities. So the change does not have any material impact on our debt-bearing capacity. All in all, the headline economic net debt figure has increased considerably versus year-end. I can reassure you that our debt level is in line with our strong BBB rating target not only for E.ON as it is today but also for the combined future E.ON. Seasonally weak Q1 working capital will reverse. IFRS 16 will not impact rating ratios, and rating agencies look through short-term volatility of pension provisions due to changes in the underlying discount rates. Furthermore, the lockbox structure of the transfer of the Renewables business to RWE implies that E.ON will be compensated for the negative free cash flow of the unit. Also bear in mind that the transfer of our EUR 1 billion stake in Nord Stream 1 into our CTA provides us with the ability to reduce our economic net debt accordingly. Following the solid first quarter, we are fully on track to achieve our full year guidance. With an unchanged operational outlook for the remaining 9 months, I confidently confirm the guidance for 2019 of an EBIT between EUR 2.9 billion and EUR 3.1 billion and an adjusted net income of between EUR 1.4 billion and EUR 1.6 billion. Furthermore, we continue to expect the 3% to 4% compound annual growth rate for our EBIT, translating into a 5% to 10% compound annual growth rate for our EPS between 2018 and '20. This guidance reflects the outlook for E.ON as it is today. After closing of the transaction, we will provide the market with a revised guidance for 2019 that will include the contribution of innogy's businesses. We also confirm our dividend proposal of EUR 0.46 per share for 2019. That said, I would like to thank you very much for your attention, and over to Stephan for the Q&A session.
Thank you, Marc. Operator, please start the Q&A session.
[Operator Instructions] We've received the first question. It is from Alberto Gandolfi with Goldman Sachs.
Two on my side. Marc, you really talked about it broadly, but I was wondering if you could help us out on a stand-alone, year-end net debt guidance. The working capital swing is quite big. Historically, there is an improvement throughout the year, but I was wondering if you can provide any more granularity, any more details. Because when you receive a VAR consensus, are there -- the numbers are a little bit all over the place. It looks like The Street is on like EUR 16.5 billion year-end net debt, and it looks like a pretty big swing and some of us are already higher than that. And so I was wondering if you can maybe elaborate on the key components of the debt assuming we freeze the rates and everything else here for the rest of the year. And the second question is on Customer Solutions. And here, maybe there's question 2a and 2b. But the 2a which I would ask is the following. So yes, you're growing your number of customers and you're saying that maybe there's a bit more of an even development throughout the quarters. But typically, Q1 is a big chunk of the year. And although tariffs may have gone up in Q2, I was wondering, when you talk about the normalization, do you think a normalization in margins for Customer Solutions? Or you make up for the EUR 1 million in the rest of the year that you did not achieve in Q1? Are you -- should we expect an above average EUR 1 million figures for the rest of the year? Or maybe Q1, it is what it is, and then as of next year, the numbers will be back being a little bit stronger? And the 2b is more like of the run rate of about, I think, in theory for the year, EUR 800 million CapEx for this Customer Solutions, how much of that is the spend for basically new services. And how much that -- is that helping your EBIT or maybe being a drag to EBIT? Because I understand customer acquisition costs are now booked basically in the P&L, if I'm not mistaken.
That's actually 3 questions. But exceptionally, we will take them. I have to say that. Otherwise, Stephan gets angry here with me. I start with the stand-alone economic net debt guidance. Once again, I would just like to stress that the year-end number will anyhow look different as it will then include the consolidated debts of innogy and all the consequences of the asset swap with RWE. If you take our guidance in a nutshell, that means cash conversion rates from EBITDA to operating cash flow before interest and taxes of more than 80%. If you take into account our EBITDA into the EBITDA guidance midpoint for the remainder of the year, you take into account the payout of the EUR 0.43 for dividend, dividend also something that is going out to minorities where typically there is no big swing compared to previous years. You take all that together, you can conclude from that, that on a stand-alone basis, it will be pretty tough to reset economic net debt exactly at the Q1 level. But if you take everything else equal, but this has been including, of course, the payout of the full dividend, that would mean that stand-alone economic net debt would increase slightly during the remainder of the year. By how much will then be a factor of how we will manage how our working capital develops, where there are also typically some exceptional swings depending on sunshine and so on where it can come too shift, which are hard to manage. But from today's point of view, a further slight increase but that's it. And again, that number by year-end will never really show up anywhere. It's going to be the combined debt including innogy. On Customer Solutions, not sure where I exactly get the answer to where -- for -- you asked for. We see price increases which we are, as we speak, implementing and started with that already beginning of April. We will normalize margins again in the sense that Q1 saw an increase in network charges effective as of 1st of January and kind of that takes away then a considerable part of the retail margin. And with the April increase, we are getting back on normal level and so that for the remainder of the year, we will see normal level again. And the same then for the years out, all on a -- set us at par with those levels as much as that may mean for retail business, where components are always moving. And against that background -- backdrop and also then rising customer numbers, we are confident that we will keep the profitability in the German sales business, for example, stable compared to prior year. So despite of the dip in the first quarter, we've normalized margins. We then should see stable profitability compared to last year. And with regard to CapEx, fortunately 50% to 60% is, let's say, customer-centric infrastructure or district heating; another 20% ought -- is earmarked for smart meter investments, which typically then follow a different revenue model; then the core commodity sales business, with then about 10% are dedicated to e-mobility, where we are focusing on fast charging or ultrafast charging along waterways; and then the remainder is from commodity sales business. And there, those are [indiscernible], which, as you rightfully said, is a minor part of the total IT spend. But still, there is a certain share which still gets capitalized. So hope that answers the questions. No chance for a follow-up now immediately, please. Thanks, Alberto.
The next question is from Deepa Venkateswaran of Bernstein.
My two questions. The first one is on IFRS 16. Would you be able to talk about the impact on the income statement, so the EBITDA/EBIT and financial expenses, for the quarter and the full year? Because I thought that it was largely netting out at EBIT, but that seems to be some impact at the financial expenses level. And secondly, in terms of the transaction time line. There is a date of August 23, which I think has been set by the EC. Should we consider that as kind of the final date? Or would you think that it may slip beyond that?
Let me start with your second question. The August 23 deadline is a pure technical deadline. It is the remainder of the 90 working days from the second phase without any extension applied now to where we are today, i.e., subtracting those days which have already been spent plus the stop the clock days. And so it's a technical deadline where you would end up from today's point of view, if you go to the end of the -- a full 90 days. We always also said that there is a possibility for an extension of another 25 working days, and this means that we are still on track to close the transaction in the second half. And we have been saying in autumn -- during autumn, which is somewhere in September/October time. But again, as always, it's not or that we finish earlier. But I think for us, as a guidance, it's more important is what we expect as the latest. Then with regard to the IFRS 16, the -- you specifically asked for the P&L effects. It's a bit an up and down with our net income line actually hardly being any impact either for Q1 or for the full year. On EBIT level, we see very minor positive impact whichever: Q1 is a low single digit and for the full year will be a low double-digit -- very low double-digit million amount. And kind of the bigger swings we actually see between EBITDA and depreciation lines there for the full year, our EBITDA will be affected positively by a low 3-digit million euro amount, and that is offset largely by the depreciation and amortization line. That's essentially it. And the minor positive EBIT impact from that gets then, if you go further down to the bottom line, basically evaporated by the interest line. So net income, as I said, nominee for (sic) [ nominal ] for effect.
The next question we've received is from Peter Bisztyga of Bank of America Merrill Lynch.
Two questions from me. Firstly, on your net debt again. I think sort of back in March in your investor presentation, you had a pro forma 2018 net debt number of EUR 32 billion for the new combined business. I think post innogy's full year results, that kind breached EUR 34 billion. Would I be right in saying that, that now looks more like EUR 36 billion once you adjust for the higher net debt in the first quarter? And can I just clarify there? Should we expect any change to your nuclear provisions at the end of the year because of different discount rates? Or are you still using the 0 real discount rate assumption? And then my second question was on the retail business. Now if I look on price comparison sites, it looks like you're pricing very aggressively in Germany. And I'm just wondering -- I mean, you said those customers are profitable, but I'm just wondering what do margins look like on these incremental customers relative to your existing German customer base? Is this kind of margin dilutive, this growth? And actually, how confident are you with retaining these customers? I mean, are you just acquiring exactly the sort of like-quality customers that are currently leaving you in the U.K.? So those are my 2 questions.
Yes. Let me start with the net debt. So we guided on a pro forma basis for an economic net debt between EUR 30 billion and EUR 35 billion, and we were clear that this range also includes the full spectrum of what we may or may not do with innogy minority shareholders. So this includes kind of on the upper limit a full buyout but certainly not something which we have decided by now on whether we actually would. But just so that is clear why the range is so broad or one of the drivers for that. With the implementation of IFRS 16, now that range basically needs to be technically then adjusted upwards. For us, if you look standalone, we guided for roughly EUR 800 million of the EUR 300 million is actually due to the Renewables business. So for going forward, roughly EUR 0.5 billion to add on that range. And then for innogy, as I -- we do not have access to their IFRS 16 accounting and specifically which effects then accrue to the Renewables business, we kind of would generally and cautiously say we may increase debt by EUR 2 billion. So we're talking of EUR 32 billion to EUR 37 billion pro forma debt. But this is as much guidance as we can give. What I would hasten -- what I always add is that with that level and the -- and EBITDA which we will be able to generate from the portfolio, we see ourselves comfortably in line with our capital structure target which we have today, the strong BBB rating. For Germany and customer acquisitions, I think the trick here is that it's not so easy to look up just the cheapest tariff on the price comparison portals. And maybe just to give you a bit more tangible examples what the success in that business is about, number one is that we have significantly reduced actually the relevance of the inbound customer leads which we get from this price comparison portal. So answer number one is what you find on the price comparison portals is increasingly and meaningfully increasingly less relevant for us. Secondly, in terms of product offerings in Germany, we'll be quite successful in launching abundant products where basically any customer can team up with any other customer to get a bundled product, something we see a great pickup in the market, and it's something which is actually not fit for any price comparison website and why that also helps to increase customer loyalty in the German market. And we're, of course, rolling that out to other markets as well. So that's -- point here is pricing comparison websites are not anymore what they used to be, i.e., the relevant benchmark for customer development for us. I'm also being reminded here by the colleagues that you asked specifically about the nuclear provisions, so let me add that. No, our methodology around economic net debt will not be changed. So as long as the real discount rate is negative, the amounts in our economic net debt will stay unchanged. And otherwise then, the -- our balance sheet amounts would fluctuate with development of the interest curve.
The next question is from Sam Arie of UBS.
I just wanted to ask a quick follow-up on deal timing and then another one on net debt. So on deal timing, you commented a few times that transaction closing should come in the second half of the year, and I'm just checking that you're talking about first closing. So then your guidance from last year still stands at second closing and might not come until the end of 2020. Just that seems quite a long way away, and we've had sort of signals from RWE that I think they expect transfer of the asset is going in their direction to happen also second half of this year. So I guess my question is can you just talk a bit about when you expect second closing to take place and what that depends on? And then my second one of the net debt, just maybe a follow-up really on Peter's question and your answer. But you spoke just now about sort of guiding net debt in the range EUR 30 billion to EUR 35 billion when the transaction was announced. I actually think you guided EUR 35 billion, including the acquisition of all the innogy minorities and the cash payment from RWE. I'm looking at Page 13 on your deal slides from last year. And then out of that, the unit per share from the Nord Stream transfer were going to come for about EUR 5 billion. So that would have kind of left you on EUR 30 billion, not EUR 30 billion to EUR 35 billion. If we now look at where we are, the EUR 34 billion, plus results today, plus innogy results, plus closing the innogy transaction, Npower, you've raised your CapEx guidance. We've got the cash costs of restructure. I'm just wondering where do you think, if we look at like 2020 pro forma net debt. Could that be now north of EUR 40 billion? And are you surprised by that? Has -- and what's kind of caused such an increase since last year?
Yes. So let me start on economic net debt. It's great to hear that people are diligently reading our communications. That will make the teams really happy who spent so much time in that. Actually, I don't have the pie -- page now in front of me here, but I have it well in front of my mental eye, and there was a deck -- a box attached to it which alluded to further measures which we will be taking like, for example, the contribution of Nord -- of our Nord Stream participation to the CTA and others. And so the EUR 35 billion is kind of strictly the pro forma as of 2017. That was kind of back in March '18, the relevant time frame. But then we also highlighted that there are further measures to come. And with those measures, we end up in the EUR 30 billion to EUR 35 billion. So no material news to read into my comments now but happy to hear that you are diligently reading our material. And in that sense, we are also not surprised by the development of the economic net debt. The only thing which we typically don't tend to have is the crystal ball on interest rates so that the net -- or the decrease in discount rate and the impact on debt, kind of that is what I would say is the only thing which kind of what's not reflected in our modeling back that time. But again, as I said, it's a quarterly development, and there will also be a number of adjustments due to the lockbox mechanism in our -- and the details of that, we are not now guiding you through here. But all that means that we are and stay very confident on our capital structure target. Deal timing, second closing, it is correct that from the beginning, we highlighted that there is potentially the need, so to say, for 2 closings. Closing 1 is the one relevant for E.ON as it will affect the innogy shares. And then a second closing or potential second closing related to the Renewables activities, at least those coming from innogy and the other assets coming from innogy. That here, we are not now guiding for a specific time line, but I can assure you that the interest here of both acting parties, RWE and E.ON, are well aligned, i.e., we have no interest -- RWE has no interest in making their time spend an extended one. And so you should continue to assume that the second closing will follow suit to the first closing.
Okay. On your -- just so we're clear because on your net debt, I was also asking if there's any chance your net debt 2020 might be in -- above EUR 40 billion. Do you think that's a reasonable expectation or not? I don't think you spoke to that point.
I told you about our expectations. I think that's it.
The next question is from Lueder Schumacher of SocGen.
Two questions from my side. The first one yet again on the antitrust approval. It looks like we went from expected ruling in August/September to now September/October. Can you maybe give us an idea of what data the commission is demanding? What are the areas of concern where they want more and more data? Would there be -- so we'll have to add more days for the whole process? And the second question is on Turkey. There's been quite a bit -- quite a big swing quarter-to-quarter. Is that sustainable? Or was this just extraordinary hydro conditions that we should not extrapolate for the full year? If you could elaborate there a bit as well, that would be much appreciated.
Yes. Lueder, with regard to the EU Commission, I will keep the answer very short now as we cannot now release sensitive information by the kind of information which the EU Commission now is asking for. I just -- seeing what they are asking for, we can reiterate that we feel comfortable that we will see a closing in autumn during this year. On the Turkish business and from the specification you gave, I assume you're referring then to the upstream business in Turkey. I think it's a combination of strong order inflow, which, of course, always, as part of the forecast, is assumed to be normalized. But I would also highlight that the income stream, to a large share, is dollar linked. So that is a pretty effective shield against the FX volatility. And also, we made some good efforts in protecting the company from any remaining FX volatility so that we're looking at the Turkish upstream business with a, I'd say, much more robust view on the remainder of the year than we would have done in the past.
So would you say that the EUR 29 million in Q1 is representative for the full year? You can't extrapolate that? Or...
No. We're not giving now a guidance for a sub-segment in noncore, sorry.
The next question is from Chris Laybutt of JPMorgan.
Three questions from me. There's been a lot of attention on the balance sheet, so one more from me. Your working capital move, which, I guess, we're all expecting or anticipating to an extent, but the EUR 200 million other working capital outflow, it's small. But I guessed for one quarter, it looks a bit bigger. So just wondering what might be behind that number and what we could expect for the year -- for the remainder of the year. I mean is there a story there? And also, in the U.K., you spoke about customer market and interim pricing. And we're seeing GBP 400 discounts now as opposed to a few weeks ago where that wasn't necessarily the case. You mentioned the decoupling of wholesale prices. How you long do you think this might persist for? And I guess your outlook through the remainder of the year in terms of margins and that market evolving will be very useful.
Yes, let me start with the U.K. business. I think the -- what we simply need to note is that with the introduction of the SVT price cap, we haven't seen kind of a normalization on the non-SVT side of the markets driven by the large differential that you're referring to. I think the current market design is with this time like in SVT pricing and so on, it's about the regulatory design, which, in our view, is simply flawed. And so I think we will take up -- been taking up the discussions with Ofgem that, that framework needs to be adjusted. It's simply not a sustainable market environment, and we see that in the profitability not only of the incumbents but also in the profitability of the new entrants. One thing is clear, that losing 200,000 customers for us is highly dissatisfactory. It's not acceptable for one of our sales units to run like that. On the other side, the chances to correct this during the remainder of the year are more than tough. So we would rather expect that we will see, given the differential today in the market in the second quarter, that this trend will continue in the second quarter at least. But then our team is on track to keep profitability this year. Whether that is enough to provide for a sustainable market is a broader question but certainly not to answer now out of the performance in one quarter. On the working capital side, I think the other part is a bit now, as always, the rest between the single effects and the bottom line impact. It's a number of various issues. Some -- and also largely of technical nature. For example, a delayed -- just the time shift from first to second quarter of dividend payments from Nord Stream, for example. You have one of those things where, as we speak, I already know that a large part of this other category has reversed. And also, with regard to the overall working capital number, we have a very good visibility following -- during the last 5 years. Two major working capital optimization programs with very good visibility on what is moving up and down. And hence, we are very confident to move back to more than 80% cash conversion.
As there are no further questions, I would hand back to you.
So then thank you very much, dear analysts and investors. Thank you very much for your questions and see you soon in London and at other places around the world. Thank you very much and enjoy the rest of the day.
Thank you very much also from my side. Bye-bye.
Ladies and gentlemen, thank you for your attendance. This call has been concluded. You may disconnect.