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Good morning. Thank you for standing by, and welcome to the Sodexo First Quarter Fiscal 2022 Revenues Conference Call. I advise you that this conference is being recorded today on Thursday, January 6, 2022. At this time, I would like now to hand the conference over to the Sodexo team. Please go ahead.
Thank you, Shahan. Good morning, everyone. Happy new year. Welcome to our first call of the year. I have with me Marc Rolland, our Group CFO, who will go through the numbers and take your questions. We've started a new format where it will just be Marc for Q1 and Q3, they are short presentations. As usual, if you haven't already done so, the slides and press releases are available at sodexo.com, and you'll be able to access this call on our website for the next 12 months. I remind you that this call is being recorded and may not be reproduced or transmitted without our consent. Please get back to me if you have any further questions after the call. I now turn you over to Marc. Thank you.
Thank you, Virginia, and good morning. And let me take this opportunity to wish you a very happy and healthy new year. I'm pleased to be here with you this morning to cover the first quarter numbers. In Slide 4, you can see that the strong recovery seen in H2 fiscal '21 has continued into the first quarter. Q1 group revenue reached EUR 5.3 billion, up 18.8% as published and plus 17.5% organically. I remind you that this compares to 17.1% in Q4 and 19% in Q3 last year. The scope change of minus 0.9% is the net of the disposals and the acquisition. This does not yet include the deconsolidation of our childcare activities because we are still waiting for the antitrust ruling. For the first time in a long time, currencies provided a boost of 2.1% to revenues, helped by the higher dollar, sterling and reais. As far as organic growth is concerned, On-Site Services continued to increase significantly at 17.9%, returning to 95% of currency-adjusted fiscal '19 levels, helped by the very strong recovery in North America, up 28.2%. Benefits & Rewards returned to high single-digit growth and is well above fiscal '19 levels, with balanced growth in its 2 regions. On Slide 5, you can see that all the On-site segments are improving in Q1, with Healthcare back over fiscal '19 levels, helped by the rapid testing centers contract in the U.K. Education continued to recover in the first quarter with the return to school and universities this academic year in the U.S. I remind you that in Europe, schools were already back last year. Schools are now up at 104% of pre-COVID levels, helped by the free meal programs in the U.S. and strong recovery in student numbers in India. In Europe and China, activity was already back last year, but was impacted by class closures and 1 less working day during the quarter in France. Universities are back up at 84% of pre-COVID levels. And while student meal plans have returned close to pre-COVID levels, there are fewer events on campus, and staff shortages are making it difficult to open all retail outlets.B&A recovered strongly, up to 91%. The return to work accelerated in September even though it remains slower in North America than in Europe. Sports & Leisure increased very substantially at 64% of pre-COVID levels in Q1 versus 43% in the fourth quarter, with stadiums, events and large convention centers reopening and with stronger average spend per person. However, since the end of November, there have been some cancellation of year-end catering events. But I remind you, they were known last year either and we had not planned for many anyway. On Slide 6, you can see the difference between the performance of food and nonfood services. Nonfood is now well ahead of pre-COVID levels. The good news is that Food Services have recovered 10 points in the quarter to reach 83% in Q1. As far as Benefits & Rewards is concerned, revenues are now firmly back over pre-COVID levels. Even in Latin America, which has been trailing Europe, there has been a substantial improvement in Brazil, which saw high single-digit growth for the first time in many quarters even if there is still some way to catch up with fiscal '19. In this heat map, we try to chart the importance of the different situations in our 4 major countries. Brazil has the biggest inflation in both food and labor, but it also has the strongest tradition of passing this through indexation and is quite agile in implementing operational and supply chain measures to compensate. North America is having significant food and labor inflation, and it is also more complicated because they also have additional issues with delivery fill rates and labor shortages which, in turn, also have an impact on cost in some form or another. The teams have been very actively using indexation clauses to pass through the inflation and are also actively putting in place mitigation measures in the operation and supply chain to ensure that profitability is protected. In the U.S., I remind you that we also have 40% of our contracts at cost plus, and more than 20% of our P&L contracts is retail where pricing adjustments are available. In France, we suffered some delivery fill issues, but inflation remain under control. This is due to our suppliers' contracts where prices were protected for a while. However, we are expecting more significant food inflation in the next quarters. And due to the increase in the minimum wage in October and then in January as well as underlying labor pressures, we expect labor inflation to be more significant this year than it has been in the past years. Even though we have indexation clauses in France, France is a country where it is more difficult to pass through the real inflation in pricing. It is due to some disconnect between indexes in contracts and perceived inflation. The teams are active on this as we speak. And in France, we've also been putting in place a lot of mitigation plans to offset the cost increases going forward. In the U.K., what will probably surprise you is that our inflation is actually very contained for the moment. We are benefiting from protective purchasing prices negotiated before inflation picked up. Our challenge will come in the second half as its purchasing prices get reviewed and labor cost increases. But we are well armed in the U.K. with a good level of cost plus contracts, and we have strong indexation mechanisms which are embedded in our big contracts. Overall, the inflation in the numbers in the first quarter's revenues was about 2%. This quarter, we have positive net new wins. In Slide 9, you can see a few examples of what we have signed. For Salesforce, we have signed a multiyear contract using The Good Eating Company for coffee and barista services in their offices in San Francisco and New York. We have signed with Simpson Senior Services communities in the U.S. to provide dining services for residents at Simpson Senior Services community locations. BRS has also won a 2-year contract with French UCANSS, the Union of National Social Security Funds, for 85,000 employees. This will make it our #1 digital client in France. As far as retention is concerned, we have renewed the Capital Health contract in New Jersey for a further 10 years. This comes after having proven for the last 20 years that we can deliver a range of services that contribute to patient and staff well-being. This time around, we've added health care technology management to the portfolio. We have also renewed our partnership with St. Barnabas Medical Center and Norwich University in the U.S. In terms of extension, we have signed with Diageo in the U.K. for soft FM services on a new site. Diageo has been a client since 2014, and Sodexo delivers a full range of hard and soft services across 70 sites from Diageo's global headquarter in London to manufacturing plants and distilleries. We have also extended our service for Ausenco in Chile and Orange in France. Now let's move on to review of operations, and let's start with On-Site. You can see strong recovery in B&A with organic growth of 19.5%, accelerating from the 14.6% in H2 last year. The 48.6% growth in North America is the result of, on the one hand, ongoing growth in G&A and also in E&R, which benefited from some new contract start-ups as well as the return to work of support staff; on the other hand, very strong rebound in Sports & Leisure as stadiums and convention centers reopened; and finally, a slow but progressive return to work in Corporate Services. Q1 was 10 points up from the second half of last year relative to fiscal '19. In Europe, the organic growth was more modest at 13.5%, but Europe is already much closer to pre-COVID levels. There has been a progressive return to the office up to the end of the quarter. Sports & Leisure was also up strongly with sites reopening and more events than usual. E&R and Government & Agencies segments were slower than usual with the lack of new ramp-ups to compensate the full impact of the loss of the Transforming Rehabilitation contract in the U.K. In Asia Pac, LatAm, Middle East and Africa, activity levels are well above pre-COVID levels. Corporate Services and Energy & Resources account for the vast majority of the activity in the region. The 11.3% organic growth was driven by a rapid recovery in India and solid growth in China in Corporate Services. There were several significant start-ups in Latin America in Energy & Resources which more than compensated the ramp-down of the extra COVID-related FM services in the APAC region. Now let's turn to Healthcare & Seniors, which was up 7.4% during the quarter. In North America, the 4.2% reflects mostly growing hospital volume, some inflation pass-through even though retail sales remained disappointing at only 70% of pre-COVID levels. Occupancy in senior homes is growing again. Healthcare North America is still only at 89% of fiscal '19 levels. This is linked predominantly to the contract losses in fiscal '19 and '20 and also the low level of retail sales since COVID. In Europe, organic growth was 11.3%. And thanks to the very large rapid testing centers contract in the U.K., activity is now well above pre-COVID levels. Demand for beds in senior homes has also continued to pick up progressively during the second half and new contracts have started -- it's actually during the Q1, sorry. In Asia Pacific, LatAm, Middle East and Africa, organic revenue growth was 10.1% due to solid volumes in China and Brazil. Education was up 28.7% in Q1 as North American schools and universities reopened fully. North America was up 39.9%. The volume of university board plan is very close to pre-COVID levels. However, Universities are still suffering from a lower level of events and retail sales affected by staff shortages, lower footfall due to persistence of some hybrid learning and strict sanitary protocols. Schools activities has also picked up significantly in terms of attendance and has been boosted by the free meal programs and despite the end of CPS. In Europe, like last year, all schools were open. Activity picked up strongly in the U.K., but was offset by class closures in November and 1 less working day in France. As a result, activity was stable for the quarter. Now let's turn to Benefits & Rewards, which I remind you was up 7% in this quarter. You can see that employee benefits were up 9.6% on issue volume growth of 9% as the revenues benefit from the ongoing catch-up of reimbursement volumes. Employee benefits are now well above pre-COVID levels. Issue volumes are also now back over pre-COVID levels. Services Diversification was down 1.7% organically. This decline reflects, on the one hand, strong growth in the fuel and mobility card, offset by the end of the exceptionally strong public benefits activity related to COVID. The growth remained very solid in Europe, Asia and U.S.A. at 6.9%, thanks to strong new development and some further catch-up in reimbursement volumes. In Europe, there were no currency or M&A impact this quarter as Wedoogift offset the disposal of Rydoo. And the weakness of the Turkish lira was offset by stronger currencies elsewhere. In Latin America, the 7.3% organic growth reflects a return to high single-digit growth in Brazil. The rest of the region continued to grow, but at a slightly lower pace due to the decline in COVID-related public benefits that I already mentioned. Operating revenues increased 7%, which I have already covered in the 2 preceding slides. But I would like to highlight that this has been done with more and more digitalization, which is currently 6 points ahead of the level in Q1 last year. And the quarter is also boosted by the seasonality of Wedoogift consolidated from the beginning of the quarter. Financial revenues were up 7.2%. The Brazilian interest rate started to rise from March. It is now at 9.25% versus circa 2% 1 year ago. Now let's turn to our fiscal 2022 guidance. The first quarter organic growth was strong, in the upper end of the range. The recovery is solid. I remind you, we were already up at 95% of pre-COVID levels when we thought that this will come as an average for the full year. And we are managing the inflation efficiently so far. The real question is whether the Omicron and the recent related measures taken by governments will have a significant impact on our activity or not, and it is just too early to say. However, I can assure you that our experience over the last 2 years has meant that the teams on the ground have reacted very fast to this new wave in all our countries. So at this stage, we maintain our annual guidance for fiscal 2022 of an organic growth between plus 15% and plus 18% and an underlying operating profit margin close to 5% at constant rates. Looking further out, I confirm that we expect On-Site Services to rapidly exceed pre-COVID levels and the performance of Benefits & Rewards to accelerate out of the crisis. Our aim is that the group returns to regular and sustained growth with, as a first step, a return to the pre-COVID underlying operating margin; and then as a second step, a margin that is back over 6%. The structural reduction in SG&A, a more effective organization, enhanced execution on the U.S. turnaround, accelerated deployment of the new food model and a more active portfolio management will all contribute. I thank you all for your attention, and now I'm available to answer your questions. Operator, can you please launch the Q&A?
[Operator Instructions] Your first question comes from the line of James Ainley from Citi.
Three, please. The first one, Marc, on the guidance, you obviously maintained, but where do you see the pinch points? Is it Education? Is it Corporate Services that you see the downside risk? Can you elaborate a bit on that? And secondly, there's been some discussion in North America particularly about delayed return to in-person learning in some U.S. school districts and some universities. What's your understanding of the situation? How widespread are those delays? And then the third question is, back in October, I think you indicated that you're perhaps seeing some easing in the labor pressures in North America. Just wondering how that's evolved in recent weeks, especially given increased sickness rates. Could you just elaborate on that, please?
Thank you. Thank you, James, for your questions. On guidance, so talking about the -- where could the pinch come from, clearly, I mean the news we have in Europe on education is that the schools will vastly reopen. And so it's the case in France, it's the case in the U.K. So we will see some disturbance in volumes, but we've already seen them in November with class closures because of COVID and so forth. So, so far, I mean the news on Education is not too disturbing. On Corporate Services, the work from home is taking people, but it's mostly white collar, is taking the white collar out of the office where they were going back to the office. So clearly, I mean we will see a drop in Food Services in the white collar environment. And for instance, in France, in La Défense, we already feel it. I remind you that in Corporate Services, we have a great activity in nonfood services and FM. And also, what we said earlier is that we have a good split between blue collar and white collar. So blue collar are not affected. So yes, we are expecting a drop in volume in Corporate Services. And we are clearly counting the weeks. If it's 2, 3 weeks, fair enough. If it was dragging into February, that will be a different impact. The daily -- delay in returns in universities, yes, we've heard the same. We've heard that some universities will probably either delay a return or start with a hybrid model. We are talking here so far a couple of weeks. So this is what we've heard. And when we know, when we factor all this and assuming those measures are short in time, the teams have demonstrated a great agility to adapt to our business, our model to the demand. And we are, at the end of Q1, in the higher range of the guidance at 17.5%. It's slightly more than what we were expecting. So the range is wide. So we are -- so far, I mean we're happy to say that it's within the guidance. Easing of labor pressure, I will say, gently. I mean it's not easing substantially. There are still pressure on shortage of staff. I think we got better organized. We have a better access to the labor market. We've improved the reach and the speed at which we could hire people. As we explained also, we were paying some joining bonuses and so forth, so I think those are practices in very tense market that we continue. And so we are managing with the resources we have. What I said though is that in some cases, like in retail in universities, the fact that we are short of staff obliges us to shut some retail outlets, and therefore, it had a small impact on the revenues. But I will say it's not easing a lot, but we are getting better at managing under the pressure.
[Operator Instructions] There are currently no further phone questions. I will hand the call back.
Hello? Are you sure there are no questions?
We have just had one come in, and your next question is from Bilal Aziz from UBS.
Just 2 from my side, please. You've clearly seen a consistent acceleration of 4% to 7% since the recovery took place. And you've already talked us through the moving pieces you've seen in Education and Corporate Services. It feels like you're suggesting it might be manageable so far, particularly the short term in nature. So given everything you've seen in December and so far, what's your best feel for the 2Q reversal potentially so far? And then separately, you've highlighted some new contract wins again. Can you perhaps provide some quantification on the size of those fees potentially and the net new win rate?
I'm not sure I understood properly the first question. So can you repeat?
Yes, sorry. Best feel for 2Q so far in the potential decelerating, if at all.
Yes. The Omicron measures are going to have an impact principally, I will say, on January's number. On December number, it started to have one, but with the holiday season, the schools were shut. So -- and the catering events, we checked the catering events, yes, there was a lot of cancellations, but we're not talking big numbers. So I'm expecting a relatively mild impact in December because of the holiday season. And they were -- and in Corporate Services, past the 15th or 20th of December, there is nobody in the office anymore. So -- and given the working from home, also people from almost mid-December started to stay home. So -- but those were expected. So it's more in January because in January, clearly, in France here, we are 3 to 4 days work from home. I mean we can see here even the office is emptying out. So -- but we are talking the measures are for a few weeks, 2, 3 weeks. And it seems that it could last only 2, 3 weeks. What we heard from Boris Johnson yesterday was very encouraging, too. We're leaving the U.K. in Plan B. I think a lot of governments do not want to impact the economy vastly. And so we are expecting a weaker Q2. Yes, January will be our weakest month. But again, I mean those winter months are not our strongest months. I think what was very important is that we did a good growth on the first quarter, which is usually our strongest quarter in revenue. And so as I said, we are in the higher range of the guidance. So yes, you can expect a weaker Q2. The net new wins, I think we don't comment the KPIs at Q1, but we just give you an indication that the net new win is positive, encouraging. There is a lot more work to be done. But I would say, the Q1 results is decent in retention and in development, but we need to push harder. I'm sure Sophie will tell us that we need to push harder.
Your next question comes from the line of Karl Green from RBC.
It's Karl Green from RBC. Just a couple of questions on the inflation comments, you've made some very helpful observations there. Just in terms of, first of all, your anticipation of inflationary pressures in the second half of the fiscal year, are they more conservative now than they were 3 months ago? And then specifically, just in terms of the U.K., you did mention those purchasing agreements which are going to roll off and need reviewing. What's your sort of best sense as to the mark-to-market impact on prevailing food prices at the moment in terms of how that's likely to flow through to the U.K. margin, please?
Yes. As I said, the inflation we've observed in Q1 on our CUGR or revenue is about 2%. I would expect that from the Q1 2%, the full year will accelerate to something more between 4% and 5%. But I keep on reading that the predictions on inflation are very changing from one month to another. So I'm hearing now or reading that inflation could reduce in the coming quarters. But I would say from the staff base and what we've observed, we have a staff in Q1 about 2%. And for the full year, we will be expecting 4% to 5%, while my earlier expectation 3, 4 months ago was more like 3%, 3% plus. So clearly, there will be more inflation than what we had expected. U.K. purchasing contract, the fact is that the supply chain in the U.K. did pretty well in locking those prices. But while those prices are locked, we're still passing inflation as per indexation. So we are ahead of the curve in the U.K. Contrary to some of the countries where we are behind the curve, we are passing the inflation after we suffered it. In the U.K., we tend to pass it now while we will suffer it only in February and March. So we are ahead of the curve in the U.K. You know that in the U.K. also, there is a social levy, national living wage and so forth. But in April, there will be a hike in salaries. But all this has been factored in, and the actions are taking place at commercial level to adjust. And we have large contracts in the U.K. It's really the country where we have the largest contracts. And those contracts are very sophisticated in terms of indexation. They have the labor index, the food index and social charges index and so forth. And every blip we observe in inflation is passed to clients. So I am not worried about the U.K. margins. They have an action plan. They are ahead of the curve, and they have good contracts. And they also have post-COVID a bit more cost plus than they had pre-COVID.
That's really helpful. Just a quick unrelated follow-on question, if I can, just around the IFRIC accounting change that you've flagged. I know it's very early, you're still working on it. Is there any kind of broad magnitude you can indicate around the potential impact on margin, please?
I'm not expecting it to be very significant. But the thing is that it's so vague what we have to apply. And the discussion with the auditors and the financial communities, even for the issuer closing on 31st of December, some have done the calculations, some are delaying it. It's just that it's very fluid at the moment. But we're not expecting it to be massive, but we just wanted to flag it that there is these things that we're working on. And I'm sure by Q2, we will be able to tell you what's going on. But don't expect any massive adjustments here.
Your next question comes from the line of Simon LeChipre from Stifel.
Three questions, please. First of all, on margin, any comments you can share on the phasing between H1 and H2? And if you could also give us some details on the phasing of the incremental cost savings that you expect to generate this year. And secondly, on Benefits & Rewards, you mentioned strong new developments in Europe. Could you be a bit more specific which countries are driving that? Would be particularly interested by any comment on France given the recent new entrants. And lastly, still on Benefits & Rewards, any update on the take-up rate in Brazil which was under pressure in previous quarters? Any inflation seen recently?
Yes. Thank you, Simon. In terms of phasing, as you remember, last year, we had an unusual phasing because there was actually no phasing between H1 and H2. We are expecting to return to phasing, maybe not the phasing as wide as it used to be. But in our models, we have a phasing with a stronger H1 and a weaker H2, but reduced from what we had, the 100 bps we had historically. Obviously, the cost savings are very strong in H1, and they will start to phase out the impact -- the marginal impact will start to phase out as we progress through the year, Q3 and Q4. I will say, BRS is having a strong quarter. It's not specifically one country or another. I think -- I mean they are doing good in Europe in many countries. I think they are doing good in France. They are doing good in Belgium. No, I think the performance in Europe is really, I will say, broadly even between the countries. And again, it's a performance, while they had already recovered -- or they were about to recover pre-COVID levels the previous period, so I think it's really a good performance. In terms of BRS in Brazil, BRS in Brazil is high single-digit growth in revenues, high growth in business volume. So I think double-digit growth in business volume actually in Q1. Clearly, I mean it's helped by inflation. And the good issuing volumes in Q1 will turn into reimbursement in the months to come. So we are expecting a much stronger performance in Brazil at the beginning of fiscal year '22, and not just due to inflation, but also due to commercial reasons, commercial focus. And so I think it's going to be a lot better for Brazil this year, which is also combined to a better exchange rate in Brazil because I think we have an increase on the average rate by 3.7% in Brazil, if I'm not mistaken. And this is quite new for us. This is very [ exciting ].
Your next question comes from the line of Kean Marden from Jefferies.
Karl actually asked my IFRIC question, and I've been trying to get out of the queue and failed. But just while I'm here, just a few other ones. So just to be clear, the -- I presume the IFRIC development relates to the capitalization policy of customization and configuration costs for cloud computing. So I don't know, Marc, whether you have to hand -- sort of how much you capitalize on that? I appreciate it's a small number, just to check. And then secondly, I presume there's no sort of formal detail or update that you can provide regarding the chief executive search or the strategic options for BRS. But is there any additional background that you'd like to provide? That would be helpful.
So yes, you're right, the IFRIC reference I was making was on the SaaS, IaaS, PaaS, all the cloud computing teams that we've been working on. We're not capitalized massive amounts, okay? But still, I mean the question is we have to put them into the right bucket, whether it's SaaS, IaaS and PaaS. And depending on which bucket they are, they can be capitalized or not. So -- and I think this is what we are trying to work out with our team and navigating the very weak instructions we get and feedback we have from auditors. So that's why we need to observe what's happening on the market with 31st of December issuer to see because it's really a moving topic which is not well documented. Again, I mean there could be an impact, but don't expect a massive impact. On the CEO search, the progress is advancing. Clearly, there is a short list. The Board is meeting regularly on this. We know it's a priority for the Board. But I think we are taking the right time to find the right person. So we don't have a name and we don't have a date yet, but it's being worked on. On BRS strategic move, I will tend to say same answer. I mean we've been actively working at options. There was communication with the Board. We do work, we have advisers and -- but yet, we have not come to a conclusion. So we can't tell you more as to what will be the next steps, but we are working on it.
Your next question comes from the line of Geoffrey d'Halluin from Bank of America.
Well, most of my questions have been answered, but maybe just one quick follow-up on the net new wins. So I appreciate you are not giving details on a quarterly basis. But could you share with us any comments on first-time outsourcing opportunities, which kind of opportunities you are seeing there, please?
Yes. Well, I'll be very careful at drawing statistics only of 3 months of activities because cutoff, signing, timing of signing. But on first-time outsourcing, our signing of first-time outsourcing in Q1 was weak, but -- and weaker than the year before. It's just a quarter, so I mean you should not draw conclusion on this. We have a fair amount of first-time outsourcing in the pipeline being worked on. And so I think that's the difficulty with KPI over 3 months is they are not necessarily meaningful. So I will assume we'll give you a better information on this with the H1. At least we will have a longer period to discuss.
And medium term, are you seeing opportunities for increasing your first-time outsourcing? Is it all COVID-19 issues for clients?
It is clearly a focus. Within our pipeline, it's a particular section that we are looking at. The teams are focusing on this. So yes, we are expecting to sign more out of our first-time outsourcing in the future, definitely.
[Operator Instructions] Your next question comes from the line of Andre Juillard from DB.
Just one question on inflation. You were mentioning that you are now expecting 4% to 5% inflation on the fiscal year. Could you split that between the food cost and the labor cost, just to give us some more color about the different components of the inflation you are expecting?
Yes, I could, but it's a lot of details. And when I was mentioning 4% to 5%, it was the impact on the revenue. As I said, in Q1, we had a 2% impact on revenue. And we are -- we were expecting to be slightly above 3% when we started the year. Now I said it's more 4% to 5%. When I referred to 4% to 5% is what we will be passing to clients on average. So internally, between food and labor, it's very different from geographies. If we're taking the Brazilian market, the food inflation will be higher than the labor inflation. I take the French market, I will say, at the end of the year, the labor inflation will be higher than the food inflation. In the U.K. market, given the good H1 we are going to have, I would say labor will be higher than food. And in the U.S., I will say it's equal, labor and food will be at the similar level. So it's the color I can give you. I think it's a fair representation of what we know today.
But any quantification possible at this stage? Or it's too early?
I don't think I want to get into that level of details with you.
[Operator Instructions] Your next question comes from the line of Bilal Aziz from UBS.
Marc, again, just a quick follow-up, please. Any update or time line rather on the appointment of the new CEO? I know you're targeting towards the end of last year, but perhaps not this year, please.
The update on new CEO, I think we had a very similar question a little while ago. But as I said, the processing is advancing, a short list exists. It's a top priority for the Board and Sophie. They're working on it. It's just that we don't have the name and I can't give you a date, but it's being worked on. The profile is still the same. That's it. So...
There are currently no further questions. I will hand back the call.
So if there are no more questions, thank you for being on the line today. And I wish you again a happy new year and especially a healthy new year, and talk to you soon.
Thank you. This concludes today's conference call. Thank you for participating. You may now disconnect.