Akastor ASA

OSE:AKAST

Earnings Call Analysis

Akastor's Q3 Performance Shows Growth Amid Market Challenges

Akastor reported a solid Q3, with revenue rising 5% to USD 213 million, driven by increased product shipments. Adjusted EBITDA surged 32% to USD 46 million, indicating strong margins at 21.7%. While aftermarket services faced challenges, other segments saw growth, particularly a 30% increase in project revenues. The firm remains optimistic, anticipating positive free cash flow in Q4 and a strong contract backlog of USD 3 million for DDW Offshore. With a net cash position of NOK 123 million, they are well-positioned for future growth and potential distributions to shareholders as market conditions improve.

Overview of Financial Performance

In the latest earnings call, the company reported a revenue of USD 213 million for the quarter, reflecting a 5% increase year-on-year and a 3% increase on a quarter-on-quarter basis. This growth was driven by higher product shipments, although it faced some headwinds from decreasing aftermarket service revenues. Adjusted EBITDA for the quarter stood at USD 46 million, marking an impressive 32% increase year-on-year. The adjusted EBITDA margin reached 21.7%, showing solid profitability despite challenges in specific segments.

Segment Performance Insights

Breaking down the revenue streams, the aftermarket services generated USD 141 million, but this represented a decline of 4% year-on-year and 6% quarter-on-quarter, primarily due to lower service order intake. Meanwhile, revenues from projects, products, and other areas surged to USD 73 million, reflecting a 30% growth year-on-year and an impressive 25% increase from the previous quarter. The orders for the quarter were USD 194 million, down 6% year-on-year but up 8% since the last quarter. This mixed performance highlights the volatility in the company's segments, specifically with restrained spending in aftermarket services.

Management Perspective on Market Trends

Executives expressed optimism about long-term macro trends despite current short-term spending restraint from customers. They noted that drillers are being cautious in allocating budgets amid a competitive contracting environment. This trend might dampen aftermarket revenues in the immediate future, but management believes that spending patterns will normalize, leading to a resurgence in future contractual agreements.

Focus on Cash Flow and Balance Sheet Stability

The company reported flat free cash flow for the quarter, attributed to timing issues with milestone collections and a build in working capital. However, management expects a positive cash flow for the fourth quarter, indicating potential improvements in cash conversion as the year ends. The current cash and cash equivalents amount to USD 33 million, and they ended the quarter with a net debt of USD 197 million, showcasing a careful approach towards managing liabilities.

Future Growth and Strategic Developments

Looking ahead, the company aims to optimize its balance sheet, expecting a decline in accounts receivable and inventory levels next year. There's also talk of preparing for an IPO in the future, contingent on market conditions, particularly for their leading investment, HMH. Management remains committed to enhancing shareholder value through strategic exits and cash distributions, though immediate distributions may be postponed to ensure adequate liquidity for future commitments.

Investing Considerations

For investors, the outlook suggests a cautiously optimistic view of the company's potential. Increasing product revenue, strong adjusted EBITDA margins, and an evolving aftermarket strategy offer growth prospects. However, investors should be mindful of the near-term impacts of restrained spending from key clients. The management's commitment to improving cash conversion and their readiness for an IPO adds another layer of intrigue for potential investors looking for value in the energy sector.

Earnings Call Transcript 2024-Q3

[Øyvind Paaske, executive]

Good afternoon, and welcome to the presentation of Akastor's Third Quarter Results.

My name is Oyvind Paaske, CFO, and I'm here together with our CEO, Mr. Karl Erik Kjelstad. As usual, we have with us HMH, represented by Tom McGee, CFO; and David Bratton, SVP, Finance. Karl will, as usual, start with some key highlights before Tom and David will go through HMH. I will then focus on Akastor consolidated financials before I turn it back to Karl. Towards the end, we'll open for questions through the new web solution where questions can be posted at any time.

I will then leave the word to Karl. Please, Karl?

[Karl Kjelstad, executive]

Thank you, Oyvind, and good afternoon and good morning to our U.S. participants, and thank you to everyone for joining us here today. We are pleased with our third quarter results, and we remain positive for the outlook for '24 for all of our portfolio companies.

Slide 2. Let us start with the key highlights for the third quarter. Our portfolio companies had a strong quarter with good operations and corresponding results. We are pleased to see continued positive development of HMH in the quarter, demonstrated by a 32% year-on-year growth in EBITDA to USD 46 million in the quarter. This is, in fact, equal to the level recorded in the fourth quarter last year and thus, on par with the highest quarterly result since HMH was established 3 years ago.

If we look at the rolling LTM, adjusted EBITDA was USD 167 million for the third quarter, significantly higher than 1 year ago. The continued profitable growth for HMH continues to be an important foundation for a future HMH liquidity event. On this note, HMH continued to keep its so-called S-1 filing prospectus with the SEC in U.S. updated. Timing of a potential launch of an IPO continue to be dependent on market conditions and the IPO sentiment. HMH remains to be our most valuable investment. The book value of our shareholding in HMH remains around 70% of our total net capital employed with a book value of NOK 3.4 billion per the end of the quarter or NOK 12.3 per Akastor share.

AKOFS Offshore delivered good operations in the quarter with a high revenue utilization, despite a planned maintenance stop for AKOFS Santos. Our book value of AKOFS was around NOK 1 per Akastor share per the end of the quarter, reduced from the second quarter, driven by negative profit in the company. DDW Offshore had all 3 vessels in operation through the quarter and generated a solid earnings. We were pleased to see that DDW secured new engagement for 2 of its vessels post the third quarter and with a total firm contract backlog now of around USD 3 million, providing a solid visibility going forward.

The value of our investment in DDW Offshore is NOK 1.4 per Akastor share, and this is based on the book value for the vessel of modest USD 11 million per vessel. Akastor maintained a net cash position through the quarter, with no draw on corporate credit facilities. In total, and including value of our listed holdings that had a value of close to NOK 1 per Akastor share per the end of the third quarter, our book equity value per the end of the period was around the same level as the previous quarter. That means about NOK 20 per Akastor share.

With that, I'm very pleased to introduce HMH's CFO and EVP, Thomas McGee, that will take us through HMH's third quarter earnings. So Tom, the floor is yours.

[Tom McGee, executive]

Thank you, Karl.

Obviously, we were very excited about this quarter. We saw a strong top line growth and strong EBITDA growth, as Karl just mentioned. Very good margin performance. Orders, a little soft. I think what's happening there is the drillers are -- you talk about white space, even though some of the drillers are still fully contracted and spending at historic levels. You just have a little bit of sideways movement, flattish offshore environment, leads to a little bit of restrained cautionary spending that could dampen the aftermarket revenue for a couple of quarters. So, we did see a little bit of lightness there, but really offset by really, really strong margin performance.

And if you think about how that develops, when we're out meeting with investors, we talk about that aftermarket business as we continue to optimize the cost structure of HMH and grow the aftermarket side, that pulls your margin up. But as we continue to grow the land business and do some of the things that we're doing with our growth initiatives that can actually dampen margin performance. So over the long run, we do expect to see margins as strong quarter-to-quarter. It's going to continue to fluctuate. And I don't think we should set the expectation you can extrapolate from this other than in the long run, we do think that's something that is sustainable over the long periods of time.

So anyway, as you look at the quarter, really strong execution on aftermarket, raising the margins and really leading to what is for us a record quarter on the margin side. And again, still making progress on land. And so that does include some of the land execution that we're continuing to get better at and continue to deliver some of those products in Mexico and the Middle East. And so we think we're making good progress on all fronts there. We also appointed a new Chairman, Dan Rabun. We're very happy to have him join as part of our overall approach to the IPO this year that Karl has talked about, continue to monitor conditions there and look at it. But from our perspective, we keep our S-1 updated. We continue to be ready, and we get better every day because we continue to grow the business. So, I think we're very happy with the progress we've made there.

And then finally, we've got -- we got stuck here, but we have a lot of our other colleagues who are in the Middle East right now celebrating an opening of our Saudi facility. So, we continue to make really great strides there. And then finally, I know it's listed as the first bullet point. We'll talk about it here as we flip the page. We'll talk about the Drillform acquisition. And when we're out meeting with investors, we've got a page that shows our global footprint. And we talk about how we took 2 effectively subscale global businesses, combine them into one, optimize the cost structure, but maintain this incredible network globally to be able to push product and service through anywhere in the world in the oilfield.

And so you take something like this, you take a technology, and you can read the slide. I'm not going to read it to you, but you take the technology that we have here that's a commercial technology. We're deepening our relationship with a very important client, Helmerich & Payne in the U.S. And then we take that technology and we push it through that global network we've been talking about. And so in the long run, this gives us tremendous growth opportunity, particularly in the Middle East and South America, we're including the products and some bits there. And so it's just a classic example of what we built this business to do. So, we're excited about that opportunity. We welcome the team on board.

So with that, I'll pass it on to David to touch on some numbers.

[David Bratton, executive]

Great. Thanks, Tom.

I'll begin with the total company results, and then we'll move into segment details. Revenue for the quarter was USD 213 million, up 5% year-on-year and up 3% quarter-on-quarter, driven by increased product shipments, partially offset by decreased aftermarket service revenue. Adjusted EBITDA in the quarter was USD 46 million, up 32% year-on-year and up 11% quarter-on-quarter, driven by increased product volume and improved revenue mix within projects, product and other.

Adjusted EBITDA rate was 21.7% in the quarter. Orders for the quarter were USD 194 million, down 6% year-on-year, driven by a decrease in aftermarket services and up 8% quarter-on-quarter, driven by increased projects, product and other, partially offset by lower service intake. On to cash flow. Free cash flow in the quarter was flat, driven by timing of key milestone collections and working capital build for key rig upgrades and land equipment projects. As we look into the fourth quarter, we expect free cash flow to be positive. We ended the quarter with USD 33 million cash and cash equivalents on hand.

On the next page, I'll walk you through the segment results in more detail. In aftermarket services, revenue was USD 141 million in the quarter, down 4% year-on-year and down 6% quarter-on-quarter, driven by lower service order intake in the quarter. Aftermarket order intake was USD 130 million, down 10% year-on-year and down 8% quarter-on-quarter, driven by flat rig activity and restrained spending by customers. In projects, products and other, revenue in the quarter was USD 73 million, up 30% year-on-year and up 25% quarter-on-quarter, driven by increased product shipments.

Lastly, moving to the next page on net interest-bearing debt. We ended the quarter with USD 33 million in cash and cash equivalents and a net debt of USD 197 million. Overall, proud of the team's performance in the past quarter. And despite the near-term restraint spending by customers, we continue to be optimistic about the longer macro trends in the market.

And with that, I'll turn it back over to Tom.

[Tom McGee, executive]

So first to touch on -- I'll touch on 4 things here to wrap up. But first, touch on cash and the balance sheet. If you look over the course of the past year, you've seen the AR and inventory grow. And that balance sheet has grown considerably, and that's consumed a lot of our cash. A lot of that is growth and growth of core products, it's growth of aftermarket, it's things that happen. However, as we've seen it grow, it's stabilized. We expect it to stabilize and decline next year. So, we will have a lot of focus on shrinking that balance sheet and actually increasing our cash conversion. We'll start to see that in Q4, as we've talked about, similar to what happened last year. But I think the overall trend is you've seen that balance sheet grow over the past year, it has peaked and will be starting to move in the other direction.

Second, we'll talk -- David mentioned it, this sort of flattish and offshore environment that we continue to see, the tug of war between the operators and the drilling contractors and the operators trying to get them to sign contracts, some of the drilling contractors trying to wait and hold out for a higher rate. We see this as a very positive long-term sentiment, particularly when you talk to drillers about the end of next year and into '26. It can lead to a little bit of restrained spending in the short term, which is what you're seeing in the order rate. So, we do continue to see that play out, but we think it's still a very bullish environment in the long run and really lends itself to strengthened conviction around product and digital upgrade cycles in the long run and continues to have us very well positioned. But again, with some flattish order volume for a couple of quarters.

Third, growth. I mean, we've got examples of both land in the Middle East. We've talked about both over the past few quarters, making very tangible progress in adding products to our portfolio, selling products on land, reengineering cost structure to be more competitive on land, reengineering products to be more competitive on land. So, there's a lot of work there, and you're starting to see that in some of our actions that we're reporting in the Middle East, continue to build that out and had a great customer event there over the last couple of days and are really excited about the progress we're making in that market.

And then finally, we can't say much about it, but just to wrap up, we are ready for an IPO when the market conditions present itself. We will be watching for both, oilfield sentiment and overall IPO market conditions and evaluating windows as we go forward.

So with that, great execution this quarter. I'm very excited, and we'll pass it back to the Akastor team.

[Øyvind Paaske, executive]

Thank you very much, Tom.

I will then take you through the Akastor financials, starting then on this slide with the net capital employed. HMH remains our largest investment and the carrying value of this investment, which is then equal to 50% of book equity value in HMH increased by NOK 120 million compared to Q2, driven by positive earnings in the period. The net capital employed of DDW was positively affected by CapEx and earnings, whilst book equity value in AKOFS was reduced due to continued negative net profit.

The value of our listed holdings, which include Odfjell Drilling, ABL Group, Maha Energy and Awilco Drilling, decreased by a total of NOK 37 million in Q3, of which NOK 20 million related to Odfjell Drilling. The negative value of other, which includes smaller financial investments, pension accruals and various provisions was reduced compared to last quarter, primarily due to the settlement of certain legacy provisions. With all this, our total net capital employed increased by NOK 118 million in the period, while equity value was up by NOK 38 million.

I will then turn to the next page for an overview of the net debt movement on Akastor in the period. As you know, and as a result of the cash effect related to the DRU case in Q2, we cleaned down all our corporate facilities and built up a strong net cash position that was maintained through this quarter. Per Q3, most of our cash holding has been invested in a liquidity fund in order to improve interest return. The liquidity fund holds fixed income securities that have a short term. In practice, this fund investment works as a cash account, but is reported under IFRS as a short-term financial investment.

In Q3, the total net cash position, including then the fund investment, decreased somewhat through corporate cash flow as well as negative cash flow in DDW related to working capital buildup as a result of commencement of new contracts and payment of SPS costs from previous periods. With this and including also funding of AKOFS of approximately NOK 30 million in the period, total net bank debt came in at a net cash position of NOK 123 million per end of Q3. This includes a net debt position of NOK 296 million in DDW Offshore.

We expect DDW's cash flow to improve going forward based on the current backlog, leading to a reduction in net debt, particularly after the commencement of the newly secured contracts that commence early 2025. Including our interest-bearing positions towards AKOFS Offshore and HMH, total net interest-bearing debt per end of the quarter came in at a net cash position of NOK 752 million.

Then the overview of our external financing facilities. Our facilities remained as per end of Q2 and our corporate bank RCF, which was amended and extended upon receipt of DRU proceeds, remained undrawn and fully available also per end of Q3. Per September, our total available liquidity was NOK 754 million, including the fund investment of NOK 404 million and NOK 25 million of cash held through DDW.

Then our consolidated P&L. As always, bear in mind that our largest holdings, including HMH, NES and AKOFS Offshore are not consolidated and thus, the consolidated revenue and EBITDA represent a very minor part of our total investment portfolio. DDW Offshore delivered revenue of NOK 97 million in the third quarter, a solid increase both year-on-year and quarter-on-quarter, driven by all vessels being in operation through the period. EBITDA in DDW came in at NOK 40 million, also significantly up compared to last quarter as a result of the improved utilization.

Q4 for DDW will be affected by low utilization and mobilization of Peregrino to Australia ahead of contract commencement in early next year, but we then expect to improve both revenues and earnings in 2025 through the new contract backlog secured this quarter. Other income in Q3 came in at NOK 2 million, with an EBITDA of negative NOK 15 million. And with that, consolidated revenues and EBITDA for the third quarter came in at NOK 99 million and NOK 25 million, respectively.

Looking at the net financials. Net financial items came in at a net negative of NOK 59 million in the period. Financial investment contributed negatively by NOK 42 million, driven by negative share price movement among our listed holdings. The FX accounting effect in Q3 was negative NOK 27 million and related to the weakening of the U.S. dollar NOK through Q3, which has since reversed through the start of Q4. Net interest contributed positively by NOK 5 million in the period, significantly improved compared to previous periods, driven by the down payment of all corporate debt last quarter and the current cash position that we have on our corporate level. Share of net profit from our equity accounted companies contributed positively with NOK 57 million, consisting then mainly of our 50% share of net profit in HMH and AKOFS Offshore. AKOFS Offshore contributed negatively with NOK 42 million in the quarter, while HMH contributed positively by NOK 100 million.

And with that, I'll pass the word back to Karl.

[Karl Kjelstad, executive]

Thanks, Oyvind.

Let me then run off this presentation with some ownership agenda reflections. Let's move to Slide 16. There is no change in our portfolio of investments from the previous quarter. We continue to have a portfolio of 9 investments, of which 4 are liquid -- listed holdings.

Let's move on to Slide 17, HMH, where I believe most already have been covered by Tom's presentation. HMH is, as mentioned earlier, keeping its S-1 filing updated and is as such, continuing to prepare for potential liquidity event. Over the last couple of months, peer valuation of U.S. oil service companies have developed negatively, and we will probably need to see a peer valuation taking a positive turn in order to enable an attractive U.S. IPO for HMH.

As a part of the process to further prepare HMH for its next phase, we, together with our co-owner, Baker Hughes, has sought to recruit an Independent Chairman for the company to bring in additional expertise and strategic guidance to the company. We are very pleased that our preferred candidate, Mr. Dan Rabun, have accepted to become HMH Chair. Dan has strong experience from the industry and particularly his experience as Chairman of ChampionX is very relevant for HMH, and as well other U.S. listed companies where he has been Chairman and in the Board.

Let us move on to Slide 17 on NES Fircroft. NES Fircroft continues to deliver strong results. The company is, as mentioned before, exit ready with different alternatives being explored, including a potential IPO. Also here, subject to that, the equity market is offering attractive valuation for a quality company like NES Fircroft. But for NES Fircroft, as for HMH, we will also need to see a shift in peer valuations for an IPO to be attractive. A key priority in this environment for NES Fircroft will be to continue to develop the company, both organically and through M&A to enhance value for all shareholders.

Slide 18, covering AKOFS Offshore. All of the AKOFS vessels were on contract through the quarter. Aker Wayfarer delivered a strong revenue utilization of 99%, while AKOFS Seafarer recorded 98%, including demobilization of coiled tubing equipment in the period. AKOFS Santos delivered a revenue utilization of 85% in the period, improved compared with the last quarters, but also affected by a specific maintenance stop of 10 days in August related to a crane onboard.

Adjusted for this, utilization was well above 90% also for Santos, which we find very positive. With this, total revenues of AKOFS ended up at USD 38 million, with an EBITDA of USD 11 million, both slightly up compared to previous quarter and as a result of the mentioned utilization. Due to the liquidity situation in AKOFS and somewhat weak utilization, in the first half year, AKOFS needed additional funding from its owner of USD 4 million in July. We continue to evaluate all options regarding the investment in AKOFS Offshore, including our ownership strategy. Given the positive market cycle in the subsea vessel sector, we see a potential benefit of a somewhat longer-term approach aimed at maximizing the value of our investment.

Then on Slide 19, DDW Offshore. All DDW Offshore vessels are now in operation and the company thereby delivered a significant growth in both revenue and EBITDA in the third quarter. Further, as mentioned already, DDW signed new contracts for Atlantic and Peregrino post the quarter end. And as per today, also, as mentioned, have a backlog of about USD 33 million, which ensures strong visibility and cash flow going forward. We also see good opportunities for continued engagement for the Emerald vessel in Australia post the current firm contract that experienced last -- later this year. And by that, all 3 vessels will be in operations in Australia. Our strategy for DDW is clearly to capitalize on the strong momentum in the market with an attractive day rates that generate solid cash flows, while we're continuously monitoring the second-hand market regarding a potential sale of the remaining assets to optimize the total value of our investment in DDW Offshore.

Finally, let's look at Slide 20 on the key priorities for Akastor going forward. In the third quarter, we marked, in fact, our 10 years anniversary from the Akastor listing that took place September 29, 2014. Since the listing, Akastor's strategy has been to develop the companies in our portfolio and when the timing is right, execute value-enhancing exits. This strategy has unfolded through more than 20 transactions, and I would say, utilizing nearly every tool from the M&A playbook. In total, we have received proceeds of about NOK 9 billion through these transactions and settlement of legacy cases. As a result, we are now debt-free and in a net cash position with no draw on corporate facilities.

Looking ahead, we remain fully committed to our strategy of developing portfolio companies and executing value-enhancing exits when the time is right to be followed with distribution of proceeds to our shareholders.

So with that, we are through the presentation, and we will move to a Q&A session. And I guess, Oyvind will pause for a minute or 2 to provide time for questions.

[Øyvind Paaske, executive]

Yes. Thanks. We'll be right back.

Yes. I'll start with a couple of questions that we have received that goes to HMH. One question that I might ask you to answer, Tom. HMH reports margin in Q3 higher than what we've seen previously. What were the drivers there? And is this a level that we should expect to see also going forward? I know you touched upon this, but I guess a good message that can be...

[Tom McGee, executive]

Let me -- I'll talk a little bit of the driver. I think I gave the forward-looking part of it. Would say what I'm allowed -- as much as I'm allowed to say there. So, I think that's covered. But I will talk about the drivers. And a lot of that, we have had some cost efforts that are coming into play that have been going on since integration as we put these businesses together. So, you are seeing some of that play out. And the other strong, strong trend this quarter was some execution around aftermarket. Some of that is mix shift where you get a little bit higher margin parts. And so there's some of that, that occurred. But some of it was just straight out. The team did a great job delivering on some service and repair. So, you had a combination of those 2 things probably being most significant.

[Øyvind Paaske, executive]

And I'll follow up with the second question to you. With regards to cash flow, the FCF, as you mentioned, was low also in Q3. Can you please explain this low cash flow conversion seen over the last couple of quarters and elaborate on how you see this develop going forward?

[Tom McGee, executive]

Sure. And I think I'll kind of repeat what I've said on the call. I think you've got a couple of things going on. One, it's primarily a balance sheet issue, right? And we've been building as the business has grown, we've been building inventory and building AR. That build has ceased. It has stabilized. It will decline next year. So, we can't give specific guidance on it other than that's the shape and the trajectory of the balance sheet will take. Some of that is assisted by the fact that when we recently put the businesses, took the final step of putting the businesses together, it becomes a lot easier to manage that inventory and AR build and do it together as a pool. And so we've got really good line of sight to that.

And so I think that's really the driver. That said, I probably should have mentioned this before, because we're getting ready for an IPO, you do end up with a lot of extra cash drag on some of the IPO expenses. And so certainly, that's been a little bit of the story this year and a lot of that gets capitalized. So, there is a little bit of a drag there, but it's primarily balance sheet growth. And you can look back a year ago to the day and look at that inventory line and see where it is. And we have stabilized and we're going to drive it down.

[Øyvind Paaske, executive]

Then the third question, which I know we've also touched upon, but the question is as follows. Service order intake fell quite significantly in Q3. Do you expect this to turn over the coming quarters?

[Tom McGee, executive]

Okay. That is interesting. Yes, I mean, I think we can safely say that spending patterns for the drillers without making it a forward-looking statement, spending patterns for the drillers will normalize. I mean, I think what you have here is you have the drillers restraining spending for some of the rigs, not all their rigs, certainly not the ones in operation. But as you get this game between the operators and the drillers, you'll end up with a couple of quarters of -- if they can delay, they will. And if the rig is hot and sitting, they'll still cut back on some of the spares and some of the things that they don't want to do, then you'll make up for that later. So, I think this is something that will be -- we'll have to watch the driller behavior. And as you see contracts get inked, which you will next year, you'll start to see that spending -- broadly speaking, you'll see their spending pick back up. So again, this is just -- you got some rigs that are hot and waiting on contracts, but aren't actually working. And so they're going to just be a little cautious and restrained in their spending as they wait for the right contract.

[Øyvind Paaske, executive]

Tom, that makes sense. Then we have several versions of the same question, but I'll take this one to you, Karl.

How do you view potential distributions in light of the current cash position for Akastor?

[Karl Kjelstad, executive]

The proceeds that we have received related to the DRU case in the second quarter, as you recall, it enabled us to pay down all debt on Akastor Corporate and put us in a net cash position. And this was an important step for us. And as mentioned also last quarter, distribution of proceeds to shareholders will be a decision of the Board. And the Board will also have to take into account cash flow commitments targeting to ensure financial flexibility. But what remains very clear is that we are very committed to distribute proceeds. And for third quarter, the assessment continued to be that distribution at this current time are not prudent based on commitments and also uncertainty related to timing of future realizations. But we expect this to be reassessed at the next realization of cash proceeds to Akastor.

[Øyvind Paaske, executive]

Thank you, Karl.

And with that, I believe we are through the questions that we have received. And I would like to thank you all for your attendance and welcome you back for our presentation of the fourth quarter results on February 13 next year. So, thank you very much.