Solutions 30 SE

PAR:S30

Earnings Call Transcript 2020-Q2

[Gianbeppi Fortis, Co]

Good afternoon, everybody. I'm Gianbeppi Fortis, Solutions 30. I'm here together with Amaury Boilot, our CFO; and Nathalie Boumendil, Investor Relations. Sara, please move to the next slide. Thank you. Okay. We are here to comment our revenues in the second half. And I opened the presentation with a few remember -- reminders concerning first half. Major things we did in these past 6 months has been to publish our 2019 financials under IFRS format. This is something that all investors were waiting for. And now it's done, it's been a lot of work from our finance department that is going pretty well in the end. And just after we have moved the company as already promised to the compartment of Euronext, the regulated market. This was done just a few days ago. In the first half of this year, we have also carried out several ESG initiatives with the objective of being more and more compliant with the rules of the regulated market. There is now one of the members of the executive committee who is in charge of ESG matters, and we are going to have an ESG report that is going to be implemented in the second part of the year. Several charters have already been published concerning the governance of the company, the Supervisory Board, Management Board and also some codes of conduct that are being applied by the company. We had a very exceptional second quarter this year with the impact of COVID. We were very scared when that began in March with the severe lockdown in Italy and then coming into all the other geographies. But in the end, we believe that we went through this crisis in a very acceptable way, and we came out stronger than competition. We saw volumes dropping beginning in March and reaching a bottom at -- in the middle of April. We were down by 35% impact in terms of revenues in April compared to February. But then the situation began to stabilize, and we got back to normal during the second half of May. We then had an exceptional month of June, has been the highest ever in our history. Part of it is related to a catch-up effect because some work was not done during April and May, but there is also something more structural that is going on now in June for the rest of the year. And that is related to investments that are coming into our telecommunications vertical, an investment that has come into our energy verticals. And that's more structural. It's the same drivers that we have before the crisis, but now after COVID, you see political drive to push these 2 verticals with bigger investments, and we are going to take advantage of this. The last point is some new wins in terms of sales, especially in the 5G field, this is going to be an important leverage for us in the coming months and in years. We now have signed agreements with all the major manufacturers of 5G equipment. We had already signed with Ericsson and Nokia. During COVID, we signed also with Huawei and ZTE. We began working with Cellnex, an infrastructure management company for mobile network infrastructure, and we had a very active sales activity even during COVID in all of the verticals. We also have a very furnished sales pipe with lots of M&A opportunities that ready to be taken. We put M&A on hold in this past 6 months because, with COVID it was not clear how the situation would evolve. Now the situation is clear, given the COVID is still around, we feel now that we are better positioned to take advantage of our strong balance sheet situation and do some M&A deals. So we are working on this in the second part of the year and then, of course, we will continue 2021. Next slide, please. Next. Amaury, do you like to continue?

[Amaury Boilot, Group CFO & Member of Executive Board]

Yes, I continue and I will now talk about the figures. Good afternoon, everyone. At the end of June 2020, as you can see on this slide, the group posted a revenue of EUR 362.8 million against EUR 318.4 million 1 year before. On a year-on-year basis, despite the impact of COVID, revenue grew by 14%, again this growth was very well balanced between organic growth and external growth. Organic growth actually accounted for a 6.8% of the revenue. And this organic growth represents 49% of the total growth in revenue in H1. So what you can see here on the left-hand side of the slide is that the organic growth remained positive in all the geographies despite the COVID prices. Regarding external growth. The acquisitions realized by the group in 2019 generated a total revenue of EUR 22.8 million over the first half of 2020, with a strong contribution of the Polish entities that we acquired at the end of 2019, beginning of 2020. We now go to the next slide. Let's have a focus on the COVID-19 crisis. Obviously, this first half of 2020 and especially the second quarter has been impacted by the lockdown measures and travel restrictions. So what you can see on this slide, if you assume a revenue base of 100 in February, revenue went down then just after by almost 35% between mid of March and mid of May. Actually, the impact was very different from one country to another, with Germany and Poland being almost unaffected by this COVID crisis when the impact was much stronger in other countries and especially in the south of Europe. So obviously, in the early stage of this lockdown, the focus of Solutions 30 management team was definitely to ensure the protection and safety of our own employees, then to adapt our own -- our operating model in order to ensure business continuity and continue to talk with our customers in order to prepare the restart of the activity. Finally, we also had a very strong focus on the monitoring of expenses and cash in order to protect the company. Then with the decrease of the activity, the group activated all the temporary unemployment measures that were implemented by the different governments in Europe, so that allowed us to absorb the drop in volumes that we had in the activity together with the decrease of the subcontracted activity. And that's how we managed to minimize the impact on our profitability of this situation. In this context, as early of mid-April, we have been focused on the restart of the activity because we have kept on talking with our customers, and we knew that they will provide us with higher volumes at the end of -- at the end of the lockdown and we wanted to be ready, and we wanted to prepare this ramp-up that was going to happen. So we had, as Gianbeppi was saying just before, had very, very strong month of June, even higher than the volumes. So we manage higher volumes than we had before the COVID crisis. And that's for -- that can be explained by several reasons. First, there has been a small catch-up effect in June. That is one reason. Second, the reliance on digital technology has been even more highlighted by this situation, and we see a positive push on our markets based on this. And finally, maybe the most important factor, Solutions 30 has been very fast to restart the activity, probably faster than the competition. And we showed our ability to scale up the business very quickly. So we even improved our relationship with our customers at the end of this period. If you now go on the next slide, #7. Yes. What you can see is that despite of the lockdown, revenue in Q2 has been growing by more than 10%. And the organic growth remained positive during this period. As I was just telling you, we had a very strong month of June, with June accounting for approximately 45% of the group revenue in the quarter. And with EUR 174 million in Q2 2020, the group even achieved a new high in terms of monthly revenue in June. And again, even if there has been an impact on the revenue of Q2, we are still close from the best performance achieved by the group during the previous quarters and that confirms the structural growth trend of our markets. So in this context, we can be positive for the second half of the year 2020. If we now go to the next slide, yes, what you can see on this slide is that all the geographies showed a strong resilience despite the lockdown. Actually, in France, revenue went up by 10% over the semester and even by 5.8% over the second quarter. This growth being mainly organic. In Benelux, revenue grew by 11.9% over H1 and by 10.4% over Q2. This takes notably into account the contribution of i-Projects group our last acquisition in the Netherlands, which helped us to develop the business in Orland, but also to diversify the activity in the energy sector. In the other countries, revenue went up by 29.4% and even 26.4% in Q2, and there's influence notably of Poland and Germany, which remained almost unaffected by the current situation. If we go now to the next slide, #10, then we will have a more detailed focus on the impact of the COVID and the development of our business across our different [indiscernible]. Here, in France, what you see is that the telecom business continued to grow very quickly, above 30%. [indiscernible] actually, this activity never stopped even during the lockdown and then we even had increased volumes after the lockdown. So as you can see, security is very dynamic and remains very dynamic. And there's an influence, notably of the fiber deployment led by public administrations in the rural areas. Regarding energy segments. As you can see, revenue decreased by 30%. This results mainly from the [indiscernible] of the deployment of smart meters between mid of March and mid of May. So basically, during this period, the activity was totally stopped. And the activity started again end of May, middle of May, and we are now back to the normal run rate. Regarding EV chargers, installation projects were also delayed during this first half of 2020. But we had a very strong sale activity over the semester, and several projects will start in the second half of 2020. Regarding the other activities, namely the IT assistance for the Payment Solutions business. Well, the activity was impacted by the shutdown of offices and by the shutdown of shops. Even if we had some additional projects in order to provide the people working from home with mobile devices, well, most of the deployments of IT hardware equipments were postponed. And -- so in this context, the activity on this segment is currently recovering gradually, and we think we will be back to normal by the end of Q3. We'll now go to Slide #12, regarding Benelux. The next one, please? Well, on this slide, we have almost similar trends. Even if the telecom activity slowed down a little bit over the first half, it continued to grow by 8%. And what we are currently seeing there is that telecom operators, especially in Belgium, are now considering to invest significantly in the fiber deployment, and we see that as a big opportunity for the future. On the Energy segment, it's almost the same thing as in France. The rollout of smart meters almost stopped in Benelux during Q2, but it started again at the end of the quarter. And we even see additional tender offers coming regarding the rollout of smart methods in this area. On the IT assistance segment, well, again, the activity was impacted in the same proportion size in France by 24% because of the shutdown of offices. Regarding the other segments, what you can see here in gray, you can see that the activity grew quite significantly, that is because of the new security business that we developed notably in the Netherlands, that remains quite small for the moment. If we now go to Slide #14, and you will have a view on the development of the activity across all the other countries. So what you can see there is that the revenue grew quite significantly by 13% in Germany, 100% organically. That is because the lockdown was not a severe lockdown in Germany. So we continue to develop our relationship with the main telco operators and with the key utilities. So just doing the maintenance activities that we were doing previously. The impact that we had there is that the tender offers for the rollout of smart meters. So new ways of rollout were actually postponed, but the activity is going well and continuing. Regarding Italy, that is probably the area of the country where the lockdown has been the most severe and the longest, where the recovery is a bit longer than in the other countries. And so we had a drop in the revenue by 18% over the first half. The activity is still recovering, and -- but we were quite happy to have the IT activity of CFC, the last company that we buy, showing strong resilience and even a stronger start beginning of December. Regarding Spain. Well, revenue went up by 32% over the first half, going up to EUR 17.5 million. So this is supported by the external acquisitions that we made at the end of 2019 when we decided to reinforce our presence on the telecom segment, especially for the rollout of fiber in Spain and the installation of the first 5G antennas there. And finally, Poland. So Poland posted a revenue of almost EUR 12 million over the first 6 months of 2020. This is pretty much in line with our expectations since the lockdown has almost no impact on the activity in this country. I don't know, Gianbeppi, if you have additional comments on these country?

[Gianbeppi Fortis, Co]

No, you're doing pretty well. I think you said most of things. Not much -- nothing much to add.

[Amaury Boilot, Group CFO & Member of Executive Board]

Okay. Okay. Thank you. So maybe we can go to Slide #16, yes, and #17, then I will leave the floor to Gianbeppi.

[Gianbeppi Fortis, Co]

Yes, okay, I can conclude here. Thank you, Amaury. I think it's been a very hard crash test for us because we basically went down by 35% in a matter of couple of months and managed to absorb the shock without using money. So we have proven that we have a machine that can scale down quite quickly. And it was even more difficult then to bounce back again because basically, we doubled volumes between April and June. And so we did the crash test the other way around being able to scale back and double the size of our machine in a matter of months. It's been a useful exercise. We have implemented new processes, of course, control and new operational processes to be sure that we can adapt quickly to volumes. So it's been a useful test. And I think, as Amaury said before, that we came out of COVID faster than competition. So we don't have public numbers yet, but our feeling is that we should have gained some market share, reacting faster than competition. We also are now very comfortable with the fact that the trends that were the drivers of our growth in the month previous to COVID are still there and are even stronger. People need what we do and even more during COVID because everybody was at home, relying on this internet connection. And now there is a clear tendency of people willing to improve their home environment in terms of communication and IT. And our activity, our service activity, our support activity is considered now essential by all of the countries in which we operate to be able to support people that use these tools. So the trends that were there before COVID are still there today. 2 main months are related the deployment of digital technology and the second one is the investments in green energy. These trends that are very important for us before COVID, and now they are even more important. We are seeing sales of electrical vehicles jumping all across Europe. France in the first half of the year 2020 has sold more electrical cars than in the full year 2019. And so we see that the projects to deploy the infrastructure to charge the cars are sped up. And it's same in telecom. We see that people want to have good connections. Operators are introducing new offers during the summer, which is quite unusual because summer is quite [indiscernible] for us, but not this year. We're expecting a strong momentum during the summer. And you also see a political willingness to invest in infrastructure to foster the cost of the economies all across Europe. And what we mean by infrastructure is not only roads and bridges, but also telecommunication infrastructure and energy infrastructure. So these 2 drivers are even stronger now than before COVID. And then the last point is that our clients have been shaken by COVID and the processes have changed. Lots of people have been working from home, and all of our clients have had a look at their costs and they're trying to implement measures to reduce cost. And that's good news for us because outsourcing our activities is a source of savings for our clients. So that was another trend that we will benefit from. So all in all, we reiterate our objective of reaching EUR 1 billion of revenues in the midterm with a good year, even 2020, during COVID, it's a year during which we will have double-digit growth as in the past. Next one, I think we are done with our presentation. And now it's time for Q&A. You can do it through the telephone or you can also use web to send us questions.

[Operator]

[Operator Instructions] And we'll go ahead and take our first question from Remi Grenu with Berenberg.

[Yann de Peyrelongue, Financial Analyst]

Yes. Can you hear me?

[Gianbeppi Fortis, Co]

Hello, Remi. Yes, absolutely.

[Yann de Peyrelongue, Financial Analyst]

Just a few questions on my side. It seems that recovery, especially in June, was mainly driven by the telecom and that the Energy segment was a bit slower to recover. Should we see increasing volume regarding smart meters in H2 to compensate for the ones that we are not deployed in H1? So this is the first question. And the second one is on telecom activity and the fact that you've set new record in June. Should we expect that level to be extrapolated for the rest of H2? Or do you think that you'll see a slowdown somehow because you've benefited from these catch-up effects in telecom? And I just one last question on guidance. Could you just clarify if the double-digit -- I think that you mentioned double-digit growth in your press release, if you could just clarify, include any M&A pipeline or if it's just purely organic growth?

[Gianbeppi Fortis, Co]

Okay, Remi. So -- okay, first question is how energy is going to be in third quarter and the second part of the year? There was a hard stop on smart meter deployments, except in Germany. And then the situation got back to normal in a matter of a couple of weeks. So June was almost normal. There is not really a catch-up effect there because we were running at nominal rate before COVID. And now we have just resumed our rate, well, a little bit faster, but not much. Basically, energy is back to normal. What -- we are seeing, but they do not think we will see the effect of that in Q3, it could be in Q4. What we are seeing is additional investment in energy, that's what I said before. There is subsidies for people who are buying electrical vehicles. And therefore, these people need solutions to charge their car. So we are seeing additional investments coming in energy with some effects for us probably last quarter of this year and then certainly in 2021. And this goes together with investment in the whole distribution network of energy. We were talking to a utility on Friday, and it's clear that, for example, if people live in a building and buy an electrical car and want a charging station, then depends on the number of people that live in the building. But if it is several, you can support either the 1 person, 2 people. But then if it is more than 3 and 4, you need to upgrade the infrastructure of the building. Otherwise, we cannot support the charge of the cars. So there is going to be significant investments in the energy sector arrived in Q4 and then '21 and onwards. That is good news for us. So that's your first question. Second question was on telecom. And the question was, are you going to see the same kind of drive that you saw in June for the rest of the year? And the answer is yes. What we are seeing now is not only a catch-up effect. So there is a little bit of catch-up in telecom, but we really see a strong push by operators because they are just answering to this demand of good quality internet connections. So there is new offers that are pushed by the operators now, in July and August, that's very unusual because usually, operators launch the new offers in September where people are back-to-school -- when kids are back-to-school. This year is different. These offers are coming out during the summer. So we are expecting a strong Q3 and then a strong second half, I would say. That is also because, like in energy, we see a political willingness to push telecommunication infrastructure. And that's true in all of the countries. I don't know if you have seen the announcements of Proximus, the Belgian operator, during COVID. They said they will speed up the fiber deployment projects they have. Telenet entered into negotiations with Fluvius, Belgian utility, for deployment of fiber. And in Germany, we see clients asking now to deploy fiber. It's still small. Germany is moving slowly, but it's a very good sign. We have the feeling that this process of deploying fiber has been accelerated by COVID even in Germany. That was the country more reluctant to adopt this new technology. And then you asked the third question, but you should remember me, please Remi. What was your third one?

[Remi Grenu, Analyst]

Yes, yes, sure. I think that you mentioned in the press release that you are targeting double-digit growth this year. I just want to -- yes. I just wanted to know -- double-digit with M&A or?

[Gianbeppi Fortis, Co]

No. At the moment, we don't like to give short-term objectives. So let's say, we are sure, we are confident that it's going to be double digit, all included. We don't feel comfortable saying how much organic and much external also because COVID is still there. So we see numbers of cases going up almost everywhere, except maybe Italy because they got very scared in March. So we don't know how second half is going to be. It's not going to be worse than what we have seen already in March or April. So we went through that. We are going through a second wave, if there is one, but we don't feel comfortable enough to give short-term objectives.

[Operator]

[Operator Instructions] And we'll take our next question from Charles Lepetitpas with ODDO BHF.

[Charles Lepetitpas, Analyst]

So maybe can you be a bit more specific on margins for H1? Because you said you remained profitable during the period. But still, should we expect a pressure on margins due to sanitary measures, for example, or the reduced activity in March and May?

[Amaury Boilot, Group CFO & Member of Executive Board]

Sure. I take it, and we received 2 questions, very similar from [indiscernible]. So I will answer your question. Well, actually, when we had the drop off in the revenue in between May and -- between March and May, we have been able to absorb part of this drop using unemployment measures and by -- by reducing the part, the share of subcontracted activity. So actually, at any moment of time, we had a negative profit, we have been able to remain cash positive to generate cash and to generate our margins. So over H1, our margins were up. Normal rates before the crisis in March. And there has been a little bit impacted during the COVID and then they recovered almost back to normal at the end of June. We had to -- we did not maintain -- we did not manage to maintain our margins at a run rate, I would say, because when you have to scale down -- scale up the business and you need to recruit people, to train them and that can use part of your margin, but do not expect a significant impact on our margins. I mean, we are talking about some points that we -- profitability -- we will have the first half of 2020 profitable, a little bit lower than the previous semesters.

[Charles Lepetitpas, Analyst]

Understood. And maybe a follow-up question on another topic regarding FTTH across Europe here. What specific country do you expect to ramp up nationwide FTTH program? Is it -- you talked about Belgium, do you expect these to be quicker than Germany or Poland?

[Gianbeppi Fortis, Co]

Yes. We are going to see FTTH investment everywhere. It's just a matter of speed then. France is running full steam. The France deployed 2.4 million connections in the last 12 months, 600,000 were in the last -- well, in the first quarter of 2020. And I'm pretty sure that in the third quarter, the speed will be even faster. And I would say it's the same all across Europe. Basically, the countries that were reluctant adopting this technology, and in particular in Germany, are now moving towards that. And the countries that were doing it already are speeding up. I mentioned Belgium before, is the case for all of the geographies. I would say there is a little twist concerning Italy, not because they are not doing it, but because of the way they do it. Now there is EUR 7 billion that are going to come from the European community to Italy, Italy is going to be the largest beneficiary of these funds. And the country is basically trying to organize itself to see how to best use these funds. But it's -- the political situation in Italy is what it is. I think we will need a few months to see exactly what happens and then how this money come to the real economy. The good news is that contrary to the previous governments, now the government has a task force of experts that is advising on how to invest this money, and the Chairman is Vittorio Colao, the former CEO of Vodafone. So he has a natural tendency to favor investments in digital technology, in particular, in telecommunications. So we are expecting good news there. It's just probably going to be slower than in other countries. So yes, I think that's in a nutshell what we believe will happen in FTTH.

[Operator]

[Operator Instructions]

[Gianbeppi Fortis, Co]

There is questions also coming from the web. Maybe I can answer to them. If there is no questions on the phone. Yes. Okay. Go ahead. So a question coming from Charlie Planade, the Capital Markets (sic) [ Midcap Partners]. When can we expect the next M&A operations to be made? As I said before, the pipe is full. So we have plenty of opportunities for M&A. We put them on all-in the first half because visibility was not good enough. Even if COVID still around, now in the second half, we have much better visibility. So we are ready to resume. Don't take it for granted because then -- if for some other or -- it's negotiations so -- but we are resuming M&A activity in the second half. So there should be some deals closed in the second half and certainly in 2021, pretty much with the same rationale as before. Priority is to strengthen our presence in geographies that are not covered or strengthen our skills in the vertical that is important for us. This is the case, for example, of 5G. We have begun doing 5G in Spain. The way we began doing 5G has been through an acquisition of a small company that has the right skills. We are looking for similar deals in other European countries to be able to follow this deployment a bit faster. So the 2 main rationales are cover a geographical area or cover a vertical. Oh there's actually just another question that came from the web on this point, [ Carlos Serene, RSP ].What are your thoughts on M&A, regions, vertical size? So I just spoke about regions and verticals. So priority is a geography that is not well covered. Second is a vertical where we do not have enough skills. Then in terms of size, I would say, it's going to be much of the same. So the bolt-ons that you have seen already in the past, we may be a couple of exceptions of deals that are a bit larger than that we have seen coming to the market, and we are going to have a look. But we do not take it for granted. So it's -- most likely that you're going to see in the second half of the year, next year, something similar to what you've already seen in the past. Other question, Olivier Parein, Crystal Asset Management. Could you give us an update to your plans to enter the U.K.? Also, could you please update on your pipeline of potential sourcing deals? U.K. So U.K. is -- it's an important topic for us now. As I said before, all of Europe is investing in telecommunications and energy. And U.K. is the same. And COVID been an accelerator of that because the companies that have shutdown has sent people working from home. So in the U.K., lots of people have gone out of London, and they've been working on the countryside, and some of them have lots of problems because the quality of the network is really poor. So we are seeing a good opportunity in the U.K. with investments coming. We are looking at that market now very closely, both organically and inorganically. We are just waiting for a positive signal concerning these investments to start. So it's really high on the priority list. I don't give it 100% in the second half, but I will give it with a very high level of probability. Now it's very likely we enter U.K. in the second half or latest in 2021. And then the second part of the question was -- disappear now. Nathalie, can you remember what was the second part of the question from Olivier Parein?

[Amaury Boilot, Group CFO & Member of Executive Board]

It was related to the outsourcing deals with [indiscernible].

[Nathalie Boumendil]

Yes.

[Gianbeppi Fortis, Co]

Yes, thank you, Amaury. Outsourcing deals, there is some of them in the pipe, but it takes time. And even though our large accounts are looking at reducing costs and outsourcing is a good option, they did through [indiscernible] and especially the large ones, their process is a little bit disrupted. So it's taking time. Do not count on such a deal in the short run. We have some of them in the pipe and is going to take more time. Then there is a question from [indiscernible] from Nokia. How do you plan to ramp-up in 5G, which needs a lot of value knowledge? It's what I said before. We are looking for external growth opportunity in the radio market. Our idea when we begin working on mobile networks in the geography is to acquire a team. Not necessarily a large team, a small team is enough, but a team that has the right knowledge and the right context and then we deploy it. And that's something that we are looking for in all of the geographies. It's something we did in Spain last year, buying a small company, [indiscernible] a with such skills. And now we are doing a nice development of this company in 2020. We want to do something similar in the other geographies. So that's the way we are going to do it. And how is the 5G business progressing outside of Spain? That comes from [indiscernible].Now it's basically answering to tender offers. It's happening in almost all of the geographies with some of them having delayed the tender offers for the attribution of frequencies. Since the case of France, the tender offer was supposed to come in the second quarter, it's coming in the third or fourth quarter, still not clear whether it is September or October. So there is a little bit of delay. And overall, also in other geographies, like in Poland, same, we were expecting something coming in the first half, it's going to be second half. So a little bit of delay, but it's just a matter of months. So basically, we are getting ready to work on 5G all across our geographies. Question from [indiscernible] if could you please comment on recent changes in the management board, Karim leaving and new members joining? Yes. Yes. That's something different. Karim has been working with me from the very beginning. And I'm the man of outside, he is the man of the inside. And he was and he is very good on operational matters. So he's the guy who go out, that goes to the field, goes to technicians and looks at the machines. And he loves to do that. And he's very good at that. He has left the management board, but he has not left the company. So basically, he's doing the same today as what he was doing a couple of weeks ago. So he's still working with us, missions related to operational matters. What he's not doing now, and it is something that he didn't like to do even before, which is all the part that is more related to the management of the company, the governance, the administration, it's board member -- it's the Board meetings all of that. And that is some things he's not have been comfortable with. So basically, what we have done as to make it official. So he's not in the management Board anymore. So he does not a part of all the initiatives that are related now to the fact that we have in the regulated market and need more structure and the different kind of governance, but he's still with us on the important operational matters. And then we have a question from [indiscernible], along terms of human resources, do you see any difficulties recruiting, notably in Germany? No, actually, good for us because now there is lots of people that are looking for a job. And by the way, we have hired several hundred people in June. As we said before, June has been a strong month. So we hired several people in June, employees and subcontractors. And there's been no problem finding them. So even in Germany, that has been always a difficult geography for us in terms of recruitment, now we see. It's here because there is more people looking for a job. There is also another piece of big news, which is the incentives of the government, in particular in France. Basically, there is a subsidy that is paid to companies that recruit young people. And since we recruit lots of young people, we are going to take advantage of that. It's not something that is going to change our P&L, but it's an interesting plus that we are going to get into our books in 2020. So no problems recruiting people. I don't see other questions. We have a question from [indiscernible]. If your COO wants to sell shares, would you have to report? Oh, that's a good question. I'm not sure I have the answer. Well, he's not planning or selling shares. But of course, he's not member of the management Board anymore. I'm not sure we are obliged to report, and I'm not sure he's obliged to report. So I would say probably not. I don't think we have to, but I'm not 100% sure. I'm sorry, I cannot answer fully to these questions. I just don't know how the law works in this situation. Amaury, you have an idea of that? Have you spoken about that with auditors?

[Amaury Boilot, Group CFO & Member of Executive Board]

No. Well, the only thing I know is that -- so he is not willing to sell all shares now. It's not part of this -- he's still attached to the company and doesn't want to do that. And -- but obviously, all the laws that are applicable applies also to Karim. If he goes below or beyond the certain threshold then he needs to declare everything. Yes. And so as part of the company and as a big shareholder, you will be considered as a related party in our financial statements, that's the only I can say about this point.

[Gianbeppi Fortis, Co]

Well, I don't see other questions. So unless there is new questions coming now, I think we covered the most important things. Yes. No questions anymore. So thank you very much for your participation. And of course, if there is other questions, something that we have forgotten, don't hesitate to contact our Investor Relations. Thank you all. Thank you very much, and good afternoon.

[Amaury Boilot, Group CFO & Member of Executive Board]

Thank you.