Ferretti SpA

MIL:YACHT

Earnings Call Analysis

Record Q1 with Revenue, Order Growth, and New Products

In the first quarter, the company achieved revenues of EUR 313 million, an 11.7% increase from the previous year. Adjusted EBITDA rose 20.5% to EUR 48 million, and the EBITDA margin improved by 110 basis points to 15.4%. The order backlog grew by 9.8% to EUR 1.643 billion. The Navetta 38 and electric Riva El-Iseo saw successful sales, while the INFYNITO 90 and INFYNITO 80 introduced eco-friendly innovations. Confident in market potential, the company expects 2024 revenues between EUR 1.220 billion and EUR 1.240 billion, with an EBITDA margin of 16% to 16.1%. CapEx investments continued, focusing on key infrastructure such as the Ravenna shipyard.

Navigating Recovery: Q1 Performance Highlights

The first quarter of 2024 has proven to be a strong opening for Ferretti Group, reflecting a revenue increase of 11.7% year-over-year, reaching EUR 313 million. This growth was guided by a mix of order backlog and new orders collected, highlighting the company's robust strategy in the upscale yacht market. The adjusted EBITDA climbed impressively by 20.5%, reaching EUR 48 million, while the EBITDA margin saw a 110 basis point rise to 15.4%. This trajectory firmly aligns with the company's midterm guidance, emphasizing consistent execution and operational discipline.

Segments and Regional Performance: Insights

A breakdown by segment reveals stability in the composite yacht sector, which remains consistent with previous years. More excitingly, the made-to-measure and super yacht segments saw significant upticks, underlining a strategic focus on these high-margin categories. Notably, Europe and the Middle East experienced solid growth, mitigating declines in Asia-Pacific markets. For instance, while Asia-Pacific orders decreased, European demand remained strong thanks to the company's expansive presence in over 70 countries. Specifically, the Americas accounted for nearly 50% of the recent EUR 50 million orders taken in May, signifying a vital market recovery.

Order Backlog and Future Demand: A Positive Outlook

The order backlog grew positively to EUR 1.643 billion, representing a 9.8% increase compared to the previous year. Orders collected in Q1 also reflected solid activity, aggregating approximately EUR 270 million. Crucially, around 52% of the net backlog is earmarked for revenue in 2024, extending visibility into the future. Despite a normalized pattern following record-breaking intakes in 2023, management assures stakeholders that demand remains robust, driven partially by recent mitigations of geopolitical tensions and an uptick in weather-related buyer enthusiasm in Europe.

Financial Position and Strategic Investments

On the financial side, Ferretti Group showcased a net financial position of EUR 206 million, indicating a strong liquidity standing. The first quarter typically absorbs some cash, but projections point toward an overall stable position by year's end, despite anticipated capital expenditures. The company is investing aggressively in its Ravenna shipyard expansion, targeting completion by early 2025 to enhance production capabilities further. This commitment to growth is reflected in projected CapEx of approximately EUR 60 million with minimal maintenance costs.

Looking Ahead: Guidance for 2024 and Beyond

Management confirmed robust guidance for 2024, projecting revenues between EUR 1.220 billion to EUR 1.240 billion, representing a growth rate of 9.8% to 11.6%. Adjusted EBITDA is anticipated to be in the range of EUR 195 million to EUR 200 million, reflecting substantial growth of 15.2% to 18.2%. Additionally, the EBITDA margin is expected to not only maintain but slightly improve to 16%–16.1%, marking a potential increase of 80 to 90 basis points. This optimistic outlook positions Ferretti Group favorably for long-term growth, with a commitment to achieving a compound annual growth rate of 10% and future M&A opportunities.

Product Innovation and Market Positioning

A noteworthy highlight from the earnings call is the introduction of innovative models such as the Navetta 38, which has already secured multiple orders in a short period. As part of its push toward sustainability, the El-Iseo project underscores Ferretti's initiative in the electric luxury yacht segment. This dual focus on customization and environmentally friendly innovations helps solidify Ferretti's brand prestige, catering to a discerning clientele that encompasses ultra-high-net-worth individuals.

Conclusion: A Growth-Driven Future

In summary, Ferretti Group demonstrates a compelling case for investors with its solid financial performance, promising order backlog, strategic investments, and innovation. The company is navigating through normalization while gearing up for future growth, consistently aligning with its guidance and objectives. The strengthening position in the luxury nautical sector, along with a well-planned path for expansion, offers a positive narrative for current and prospective investors.

Earnings Call Transcript 2024-Q1

[Alberto Galassi, executive]

Buongiorno. Good evening, it's actually buona sera to everybody. Alberto Galassi speaking. On my right, Marco Zammarchi, the CFO; on my left, Stefano De Vivo, Chief Commercial Officer of the Group and Managing Director of the brand Wally. Very pleased to see you again today. We just released today and approved by the Board of Directors this morning important numbers, which we are very proud of. And we are super happy and super confident on the market and our positioning and our results. And I would like to share with you some data.

So the revenues of the first quarter reached EUR 313 million, so 11.7% more than previous year, that was EUR 280 million. And the adjusted EBITDA from EUR 40 million around number of Q1 2023 reached EUR 48 million, so 20.5% higher in Q1 '24. And we had the margin -- EBITDA margin, which went up of 110 basis points from 14.3% to 15.4%. This continues and confirms the growth on EBITDA margin and the guidance that we gave.

The order backlog, it's an important number, from EUR 1.496 billion of the Q1 2023 to EUR 1.643 billion of Q1 '24, plus 9.8%. So all these digits and all these indicators are saying that the company is very sound and profitable and growing in its performance, which I would say, with a consistent track record on what we promised and what we've delivered in the past 2 years since the beginning of the listing experience in Hong Kong.

Now the business highlights. I am super proud of presenting you the new jewel of the custom line brand. Let me remind you, the Custom Line is made-to-measure -- is the queen of made-to-measure products from 30 meters to 43 meters in composite. The Navetta 38 starts the new era of the Navetta segment. It's been designed by Mr. Salvetti. The interior design is been by Citterio Viel, very famous architects. And with their style and their beauty and their performances and the technology that we put on board, we were able to sell 6 units. But what's important is to highlight that these 3 units of the 6 that we sold has been sold after the presentation in Venice last week. So it's been an immense success.

And I would like you to spend some time seeing the beauties of the ship. We're very proud that represents the beginning of the new portfolio products of Custom Line, please.

[Presentation]

[Alberto Galassi, executive]

Obviously, the original video is longer, and my apologies because this fantastic song deserves more attention and the product itself deserves more attention. But let me remind you also that the 6 units we've sold, the price tag of this boat is -- the ship is EUR 21 million. So that's why we're super confident and super happy about how the market received this incredible model.

Now the other important project that we unveiled and we sold already, in the United States is the El-Iseo, the electric Riva. The electric Riva starts and basically is the beginning, the first pillar of what we call the E-segment. The E-segment is electric luxury technically and E-Luxury is what we call. So El-Iseo in 1 unit sold, fully electric, is going to be on display this week in Modena 4 Cavallino Classic event with all the classic Ferraris. It's an important event. And we like the combination being partner and sponsor of Ferrari presenting the El-Iseo live during the Cavallino Classic in contemporary with the Formula 1 Grand Prix of Imola.

Now also Wally, let me remind you that it's a brand -- sorry, there is a video, my fault.

[Presentation]

[Alberto Galassi, executive]

As I said, 1 units sold in the U.S. Let me remind you that compared to the normal El-Iseo with the thermal engine, the price is 3x higher, and we're very proud of being -- having this product certified by the Italian never registered. Wally, we presented, as we said, the Wally 50, it's an incredible tender. And 4 units of the 50 has been sold. We presented it in Dusseldorf, if I'm not mistaken, in the end of January, mid-January in 2024. Now there's also a new range expansion of products. We presented the INFYNITO 90. We presented INFYNITO 90 last year in Cannes, and we said it starts of a family. So the range of INFYNITO is now with INFYNITO sister, smaller younger sister, it's called sister INFYNITO 80. In Dusseldorf, they saw beginning of the presentation of this boat. The 90, we sold in 6 units already, all over the world, because we have this fantastic solution of the old season [ teras ]. It reminds was a bit of the Alfresco dining of some Italian [ pellets in renaissance ].

The INFYNITO 80 has also an incredible sustainable solution, which is FSEA, that's Ferretti Sustainable Enhanced Architecture, which is a package of eco-friendly solutions. They include an integrated system with solar panels, photovoltaic, energy bank and totally green materials, bamboo fabrics, regenerated leather, recyclable materials, ecological water-based paints, lamellar teak, everything with FSC 5 certification. So at the end of the day, we're seeing that more and more clients are looking also of these aspects and the Ferretti fleet range, which is going to be manufactured in the new site of Ravenna, the most important facility currently under construction. We'll go back to this later on. It's very well welcome from the market.

Now let me step down and give -- number one will be presented in Cannes, for sure. Let me step down and leave -- Stefano De Vivo to give you a flavor on the market order backlog and net backlog. Stefano?

[Stefano De Vivo, executive]

Good afternoon, everybody. So we were very busy collecting orders in the first quarter of the year. As you can see, the order backlog increased by nearly 10% and the net backlog increased by 2.8%. This has given us an even further visibility on the future of revenue stream. As you can see, 2024, 52% of our net backlog is to cover 2024, and 48% goes beyond 2024.

In Q1, we have collected approximately EUR 270 million of orders, which correspond to 7 to 50 units, nearly EUR 5 million per unit. In the same period, the group delivered 29 units. So as you can see, our order backlog keeps on increasing, both in price tag and number of units.

If we look at the segments, every segment is growing in the order backlog, especially we have to point out composite yachts that had an increase of nearly 10% and super yachts where we took, you'll see in a second, over EUR 60 million of orders.

As you can see, the order intake reduced compared to the previous year, but this didn't impact the fact that we grew in order backlog, both net and not net order backlog to EUR 267 million. This is mainly due to a moment of timing in taking the orders. And as a matter of fact, in the last 2 weeks, we took over EUR 50 million. So in this business, you should always check year-on-year, the whole year rather than just a quarter because timing can really make a difference. As a matter of fact, today, we have negotiations for over EUR 314 million. And as I said, just in the last 2 weeks, we took over EUR 50 million of orders.

Now if we check by segment, we can see a normalization of the market where we had record-breaking order intake in Q1 '23. And now with a normalization, we can see that we had a reduction in composite yachts and made-to-measure while we increased in super yachts quite dramatically. Again, this is linked to the normalization of a moment. You can see it in the next slide, especially for the markets. You can see that Europe is down 16%. But as a matter of fact, if you go check on the total weight of the orders of the quarter, you can see that the percentages and the averages are all more or less maintained. The only place where we're seeing a strong reduction is Asia Pacific, but it is also our smallest market, and therefore, again, the timing effect can make a big difference.

The Americas, you can see that there is minus 46%. It's true that Q1 '23 was way higher than we had ever seen before. So I would say that we are in line with our budgets for America. And as a matter of fact, of those EUR 50-plus million of orders that we had just in the beginning of month of May, thanks to the Navetta 38 and so on, nearly 50% of them were taken only in America alone.

Marco, over to you for the revenue.

[Marco Zammarchi, executive]

Thank you. So revenues, as we said at the beginning, an increase of 11.7%, perfectly in line with the guidance that we provided a few months ago. And the rationale behind this increase is, thanks to the order backlog -- the combination of the order backlog and the new order collection. And if we analyze the revenues by segment, we can say that -- we can see that the composite segment is stable compared with prior year. On the other hand is that we see a significant increase in made-to-measure and especially in Super Yacht, that are the focus that we always mentioned as part of our strategy. So more and more focused on made-to-measure and also on the entry level of the Super Yacht, that means the Super Yacht with a brand, Riva or Pershing or Custom Line, and then we are having a good result in this area.

Instead, if we analyze by geography, okay, we see that Asia Pacific has not performed, but we know that it's a matter of seasonality and timely effect as Stefano mentioned before, and the same happens in the Americas. On the other hand, we have very good result in Europe and in Middle East and Africa. And this is, thanks to our capillarity, because we are present in more than 70 countries. So we are able to compensate the slowdown of the normalization of some market with some booming phases of other mark, in this case, Europe and the Middle East and Africa.

About the profitability, we increased by 20.5%, our EBITDA margin to the record-breaking number of EUR 48 million. The EBITDA margin increased by 110 basis points. So perfectly in line with our midterm guidance that we provided to the market. And we see the same trend for net profit. In term of CapEx, in the first quarter, we have invested nearly EUR 60 million with a very limited portion related to maintenance CapEx, that is stably below 2% of our revenues. On the other hand, we continue to expand to proceed with the completion of the Ravenna shipyard that, in fact, is 68% of the expansion CapEx. So we are talking about nearly EUR 40 million.

And we continue, because as we said and we checked a few days ago, our utilization rate of our plant is still over 95%. In some cases, we are exceeding also 100%. So we are completing some both out of the shed. And so we need to have this plant ready as soon as possible.

In terms of net financial position, we are still in a very positive position, EUR 206 million. We have to note that in this period because it's a seasonality, we decreased our net financial position. Two main reasons behind it that was reflected in the net working capital. And the consideration are because we are restocking some product in display for AMAS in upper markets because this market are requiring, especially for composite segment to products to be put on display. And we are -- and the other reason behind the increase -- temporary increase of the working capital is because now we are facing the delivery season in Europe and Middle East, so step by step. But as we speak in the month of April and May, we are delivering the boat collecting the money and so working capital is versus the normalization. And the last point, it was the -- it was a direct consequence of the order intake normalization that we said before. So said that, I leave...

[Alberto Galassi, executive]

We are confirming -- happy to confirm the guidance that we gave. For 2024, the revenues, EUR 1.220 billion to EUR 1.240 billion, with the growth that goes from 9.8% to 11.6%. Adjusted EBITDA, EUR 195 million to EUR 200 million, so plus 15.2% or 18.2%. And the EBITDA margin, 16% to 16.1%, 80 basis points to 90 basis points more. Confirming that the midterm target of this company, and again, what we say we do, we've been delivering so far every time, actually meeting the expectations. At least there's a little. We are very proud on the execution of what we said. 10% organic CAGR with further M&A upside. There's been also an important Board of Directors today discussing the future strategies of the company. And the EBITDA margin, major or equal 18.5%.

So this is the quarter presentation of Ferretti group. We are here to wait for any questions that you have. And thank you for your attention so far.

[Operator]

[Operator Instructions] Our first question is from Adrien Duverger from Goldman.

[Adrien Duverger, analyst]

This is Adrien Duverger from Goldman Sachs. And thank you for the presentation. I have 2 questions...

[Operator]

We have our next question from Alessandro Cecchini from Equita.

[Alessandro Cecchini, analyst]

My first question is actually on the order intake. How do you see the demand evolving through the year -- through this year? I mean, the second question is about the net financial position. Considering your current order intake and the level of inventory that you have, how do you see the net financial position evolving through the year for the year-end?

[Stefano De Vivo, executive]

I'll start with the order intake. We see the demand evolving during the year, within the short term, a very big increase as we've seen and we're already experiencing, as I was telling you, because we are seeing that a lot of clients had postponed. Let's not forget that in the first quarter we had a lot of tensions in the Middle East and this also propagated up to April. Iran and Israel just to name the most important one. And I think you'll find out that a lot of clients have postponed their decision, and now we're actually signing and that's why we're seeing higher-than-normal demand.

The other thing is that we are experiencing a weird end of winter or spring. It's been pretty cold and you'd be surprised, but especially in Europe, when you turn off the heaters and you start turning on the air conditioning, the demand starts increasing dramatically. So we are seeing that in the countries, for example, like Spain, where weather is already warm, we are getting a lot of inquiries in the last week. So we don't see a decrease in this, and we think that it's going to be in line with our budgets. And therefore, that our order intake will be stable or slightly increasing, which is exactly what we were expecting because again, we were much higher than expected in the previous years. And with a normalization of order intake, this is going to steadily increase slightly.

Marco, you want to answer for the...

[Marco Zammarchi, executive]

About the net financial position, usually, as we said, Q1 is the quarter that absorbed cash. On the other hand, Q3 -- Q2 and Q3 are the ones started are releasing cash. So just to give you a very high-level idea of how we see the net financial position at year-end, we believe that we -- saying that the CapEx will be slightly less than what we invested in 2023 and taking also in consideration that we distribute dividend for over EUR 33 million. We believe that the net financial position will be slightly less than prior year result -- prior year -- in December 2023. So this is what is our expectation.

[Operator]

Let's circle back to Adrien.

[Adrien Duverger, analyst]

So could you please comment on April and early May trading and how that compares to the end of the first quarter. And then my second question would be on the EBITDA margin. We've seen a 110 basis point improvement in this quarter. So can you please walk us through the different building blocks of this improvement? And how you think you can continue to improve on this? And my last question would be on the M&A pipeline and on potential acquisitions and expansions for the factories.

[Alberto Galassi, executive]

As Stefano De Vivo just mentioned before, April and May have been good months, May better than April, April within international tensions. The weather, at least in Europe, has been terrible. Actually, I'm speaking from Milan, it's pouring rain like there's no tomorrow. And believe it or not, if you have to define the purchase of a boat or just visiting the boat, you're intending to buy your different postponing the thing. So how is the feedback from now on? Very, very good. Let's make an example. Let me repeat myself once more. Once we presented Navetta 38, and I'm talking about a EUR 21 million ship in Venice, last week, last Thursday, we signed in a week, that week and this week, 3 units. Now this is not by chance. This is not by coincidence, no matter what. There is a demand for very nice looking, very contemporary, very stylish, very elegant products.

Don't forget -- when I read some times and you give me the opportunity to say something more. When you read sometimes luxury, luxury, luxury, luxury, luxury can be a necessary, luxury can be a pair of shoes, luxury can be a fantastic sports car, luxury can be a piece of art, luxury can be an apartment, a villa or a yacht or a business jet. So we are, again, addressing a kind of client with an importance of cross-selling in our group, which is, trust me, unique because the client of the Navetta -- of the Custom Line 140, just purchased the Wally 43. Or we can have another example of the client of the Navetta 37, November 11, they purchased another Wally as a tender.

So the combination of what we make, the brands that we have, where we are positioning in time surprising, and I would say also allure and marketing and the quality of the products plus the cross-branding makes us very, very, very different than other competitors. And I can tell you that the feedbacks we're getting from the market as we speak, is very positive. So the trend in the month of May, more than in the month of April, including United States is a very good trend.

I give you Marco for a second, and then I conclude your question.

[Marco Zammarchi, executive]

About EBITDA, as we said, we increased 110 basis points, much higher than our guidance, but we prefer to be stick to the guidance that we provided a few months ago. And the rational is the one that we mentioned in our previous meeting. This is a product mix because we see our company more and more focused in revenues generated by entry level of Super Yacht made-to-measure that are by far the better profitability that we have. And on the other hand, we continue to play a very significant role the fixed cost assumption because -- thanks to our operational model. So we believe that we -- in this moment, we are taking advantages of some temporary effect. We prefer at the moment to stay in the guidance that you see an increase between 80 and 90 basis points. But we are analyzing the trend of the next quarter to see if to adjust or not.

[Alberto Galassi, executive]

On the M&A, as I said today, there's been an important board. We define some strategies. We want to focus and continue to acquire suppliers. We want to invest in our supply chain. What we have done already in the past 2 years after the listing in Hong Kong, we'll continue in 2024, and we hope to make announcements soon.

The other thing that we would like, where we like to invest is in services. Still what's been offered to us is still considered very expensive. And we don't think there's a lot of rationale in buying with different multiples than what we trade. As I keep saying, we are one of the [ bossed segments ] to kept secrets of the Italian stock market. I mean, we trade -- to be honest, there's -- we are discounted -- heavily discounted what is the value of this company. And we don't understand why we should buy with the premium, what doesn't deserve a premium to cut the long story short.

The last point is we've been offered to buy ship yards with brands. And to be honest, we have 7 notes of the pentagram with Ferretti Group so far. We didn't identify any brand that was worth even to have a look at a deep dive on it. So we are not stopping to grow. We're not stopping with the M&A. It has to make sense. And I think we will announce something interesting, at least for us, very interesting quite soon.

[Operator]

Our next audio question is from Niccolò Storer from Kepler.

[Niccolò Guido Storer, analyst]

So I have 3 questions. The first one, if you can a little bit elaborate on working capital movements and quantify the increase in inventories, considering that this trend of restocking apparently has been going on for quite -- why is it reasonable to assume that after this further increase the restocking is over also because of seasonality. And from now on, we should see some improvements on that front.

The second question is, maybe an update on Ravenna, which is the state of the art of the new plant considering that you spent already a lot of the budgeted CapEx for 2024 on the site.

The last question is on buyback, probably the cancellation of the proposal annoyed a bit market. So do you have any update to share with us on that?

[Marco Zammarchi, executive]

Working capital, as we said, is a matter of seasonality. Usually, in this period, during the Q1, especially for Composite Yacht, we have to provide some availability of models in every market, and especially for AMAS and APAC that are marketed that they wanted to see their boat on display. That was the reason why usually in Q1, our working capital, our inventories are increasing. And as we said, we had the normalization of the order intake during the first quarter that contribute a little bit to this to move in the positive area. But according to our estimation of our view and also as we speak, also in consideration of the order intake that we get in the last 1 month after the closing of first quarter. We believe that our normal rate of net financial -- of net working capital is between 0 and minus 5%, and we believe we are still in this range.

[Stefano De Vivo, executive]

To add on what Marco said on the inventories, please note that today to give you a rough idea, we are slightly less as level of inventory than we were in 2019. But our revenues are nearly double than the ones of 2019. So when we say normalization of the market, it means the market has grown a lot. It was just spiking for a little bit. But now we are back to numbers of 2019 as levels of inventories, but we've doubled the revenue. So that's why the net working capital can be much better.

[Alberto Galassi, executive]

On Ravenna, thank you for the question. Ravenna is, today, as we speak, already operational, the Ferretti INFYNITO 90 and the Ferretti INFYNITO 80 are currently manufactured in Ravenna. Ravenna today is 20% of its operation capacity. She will be -- sorry, but the plant will be completed. She's beautiful. That's why I called SHE. The plant will be completed in beginning of 2025. So January, February '25. So it's already operational. And on steps, it will be fully completed.

And regarding Wally sale, Wally sale will be May, June 2025. So by May, June '25, including the possibility of in-sourcing -- the production of the Wally sailboats, very profitable, very important. Wally is a very important brand for us with a great potential for sailboats and powerboats. It will be in June -- May, June 2025.

On the buyback, your question gives me the possibility to make some clarity on a lot of noise and a lot of fuss around something that maybe we didn't explain well or maybe it was not taken in the right way. The reality is that we are the only company in the world listed in Hong Kong and Milan. Unfortunately or luckily, we have to follow 2 very different regulations. The buyback plan is not stopped, it's not canceled. The buyback plan will go on. There's been a discussion because the Hong Kong Stock Exchange is changing the rules on the treasury shares, technically the shares of the buyback.

Now today, as we speak, 1 month ago, the Hong Kong rules were saying that any time you buy a share, you have to cancel the shares, unless you ask for a waiver. But if you ask for a waiver, then you have very well to explain to the authorities that you're not doing any mandatory tender offering. So it's quite complex. And the Hong Kong Stock Exchange is changing these rules, not with taking away the mandatory cancellation of the treasury shares. So the decision is being, we simply have -- will simply postponed the moment once we have clarity on the other market, which is Hong Kong.

The shareholders -- and today has been restated. We want to do the buyback shares. We want to go with the buyback shares. And of course, part of the buyback shares will be for the management incentive plan of this company. Patience is what is required when you have to deal with 2 authorities. But the path is signed, that is on track. Hopefully, it will happen within the summer. We would like to do this before -- definitely before the end of this year, hopefully, ideally before the end of the third quarter. So it's a moving target, but it's not canceled, it's simply postponed.

[Operator]

We are now moving to written questions. Our first question is from Luca Riboldi from Banor. Do you see any slowdown in the order book or some cancellation? What is your exposure versus U.S. dollar?

[Stefano De Vivo, executive]

As far as order book, we discussed extensively. So we see a normalization, but we don't see a proper slowdown. As far as cancellations, we haven't had any, and we don't believe we're going to have any. And this is also part of our policy there has always been to have final clients with very large deposits, therefore, because we're selling to the ultra-high net worth of the world. They will not leave on the table 30%, 40%, 50%, 60% or 70% of their -- value of their boats to walk away from a deal. So no, we're not seeing cancellations, and we don't foresee in the near future. Marco, if you want to elaborate on dollar?

[Marco Zammarchi, executive]

About the exposure to U.S. dollar, our policy is to sell in U.S. dollar only for the composite segment in the U.S. So we are talking about 15% of total -- our total sales. But we have to take into consideration also that we have some running costs for the U.S. subsidiary and also some material that we buy in U.S. dollars. So we could say that the net exposure to U.S. dollar is less than 5% of our total revenues.

[Operator]

Thank you very much. Mr. Galassi, it seems to be that the rest of the questions that we have there are already answered. So with that, I think we may consider concluding.

[Alberto Galassi, executive]

Thank you very much. Thank you for your time. Thank you for your attention, for your trust. Keep focusing on us, and we will deliver again. Thank you very much.