ENGIE Energia Chile SA

SGO:ECL

Earnings Call Transcript 2018-Q3

[Operator]

Good day, everyone, and welcome to Engie Energia Chile's Third Quarter 2018 Results Conference Call. If you need a copy of the press release issued last week, it is available on the company's website at www.engie.cl.

Before we begin, I would like to remind you that this call is being recorded and that information discussed today may include forward-looking statements regarding the company's financial and operating performance. All projections are subject to risks and uncertainties, and actual results may differ materially. Please refer to the detailed note in the company's press release regarding forward-looking statements. We would like to advise participants that this call is dedicated to investors and market analysts, not for the press. We ask all journalists to contact Engie Energia Chile's PR Department for details.

I will now turn the call over to Mr. Eduardo Milligan. Please go ahead, sir.

[Eduardo Milligan Wenzel, executive]

Thank you very much. Good afternoon, and thank you for attending this call. Today, Bernardita Infante, Head of Finance; Marcela Munoz, Head of Investor Relations; and I are very pleased to be once again with you and present our results for the first 9 months of this year.

I will start the presentation with the key messages, the status of our main projects under construction and some of the main events in the industry and the company during these first 9 months of the year. Then Bernardita will present our detailed financial results and our updated financial plan.

So please let's move directly to the main messages on Page #9. You may know that we kept the same key messages that we reported 3 months ago. Sometimes it's good to keep consistency and the same messages during the time, confirming the trends anticipated for this year.

So in first place, we are glad to report another strong quarter, in line with the guidance we provided for this year. As you know, the main driver for our recent growth has been the new PPAs, which started last January. Second, as mentioned in our last 2 calls, during the first quarter, we announced an important event for ECL, which will drive our strategy and the main development efforts in the future. We finalized the renegotiation of some PPAs with mining companies, with conditions that will trigger the possibility of starting a gradual transformation of our thermal portfolio, 2 renewables, mainly wind and solar. Third, through this year, we have continued developing our renewable portfolio and our next goal is to put these projects into a ready-to-build stage. As mentioned in our previous call, the construction phase will be launched at best time to market conditions.

In the transmission business, this year ECL won 3 auctions to build new transmission systems within the process launched by the CNE in relation to the National Transmission Expansion Plan. And last, but not least, we are in the final phase of our 2015-2018 CapEx plan. Given our continued strong cash generation and the fact that our projects have been completed within or even below budget, we do not expect additional debt needs in the upcoming months to finalize the IEM project. In fact, as you will notice, we repaid a portion of our short-term debt in October beyond the cut-off date of this results.

Let's now move to Page #10 and look into the main industry and company events during these 9 months. We will start with the industry event. First, as you know, the interconnection between the SIC and the SING grids began operations in November 2017. Since then, the interconnection has proven important for the system. It triggered the birth of our single grid, the SEN, or S-E-N, with a single coordinator. Currently, the interconnection's transmission capacity is limited to around half of its total capacity or the equivalent of approximately 700 megawatts, since the sovereign section of the interconnection has not yet been completed. In any case, interconnection so far has allowed the solar PV generators in the central system to export their power production to the northern system, allowing them to reduce between 75% and 80% the trapped solar PV capacity in the central system. We expect the final interconnection should be ready during the first half of 2019 following the development company recent announcement.

Second, last January, the main generation company agreed not to develop new coal plants, and together with the relevant authorities and other stakeholders established a roundtable to discuss alternatives to start a gradual decarbonization of the system. This well group will analyze the condition, taking into consideration all the impacts from the different perspectives, social, economic, regulatory, systems reliability, among others that should be considered when such important decision will take place.

Finally, the CNE conducted public auctions to award new transmission projects under the annual National Transmission Expansion Plan. The aggregate referential investment value was $300 million and we were awarded with around 13% of this investment. The instructions were followed by bidding processes for zonal transmission projects, considering investments for an aggregate of $750 million (sic) [ $570 million ]. We presented bid for some of these projects, but we were not awarded with any of them in the last process.

From a company perspective, the main event during these 9 months

[Audio Gap]

some of them in length in previous call were, I would first mentioned the second bullet point, which is the most recent news. The IEM plant was successfully synchronized on October 29, meaning that it injected power to the grid for the first time. These are very important milestones for the project. Other relevant milestones, such as the maximum load and heat rate test have been scheduled for January 2019. The project COD was postponed then for a couple of months, so now we expect the full COD to occur during the first quarter of 2019. However, as I just mentioned, we expect to reach the full maximum load during January, which it's, again, a very important milestone before we declare the full commercial operation of the plant.

This delay or this additional delay for a couple of months was because there was a short-circuit incident last August during the -- damaging the synchronization test, which caused damage to the generator circuit breaker and bus bar. So this equipment was replaced. The damages were quickly repaired in order to resume commission. So these efforts proved to be successful and the synchronization was achieved at the end of October, as I just mentioned.

Then, in April, we signed amendments with Codelco and Glencore PPAs to start the gradual decarbonization of these PPAs together with an important extension of the contract. This is not new. This is what we already mentioned during the first quarter result of the year. Following this announcement, we also requested authorization to disconnect units 12 and 13 in Tocopilla in April 2019. So we obtained the authorization from the CNE to disconnect these 2 units, totaling around 138 megawatts, subject to 1 condition, which is the full interconnection of the system, which should occur close to such date. As I mentioned before, we expect this should occur during the first half of 2019.

As mentioned in previous quarters, the most important event for ECL in 2018 is the start of the new regulated PPAs. Demand under regulated contracts is not growing at a rate we used to see in the past, as more clients are now able to negotiate their power supply directly with generation company instead of buying through -- or constructing through distribution companies. Despite this trend, we can confirm that the demand of PPA-regulated client is moving in line with our estimates and the guidance we provided to you early this year, which, in fact, already considered our estimation of this risk. So what we are seeing right now is the materialization of our risk we already considered in our guidance.

Also, to meet the demand from distribution companies in Central Chile, we signed a bridge power supply agreement with other generation companies basically to hedge our exposure in the central system until the interconnection begins operating at full capacity. So these bridge PPAs accounted for about half of the power supply needed for the new contracts with distribution companies in 2018. Now for 2019, we are working on similar alternatives to extend this hedging structure. As soon as we have news on this topic, we will share them with you.

Then and finally, Puerto Andino, our new port is already in operations. It has unloaded almost 1.2 million tons of fuel from 19 vessels, including a Capesize carrier during this year. So the port is running very efficiently and as expected.

Now please let's go to Page 11. In this snapshot, we're summarizing our 9-month results compared to the previous year. Once again, our operating results were pretty much in line with our growth expectations for 2018. In this year, we reported 22% revenue growth and 39% EBITDA growth, while recurring net income almost doubled from last year. Even after considering the impairment related to the future closure of the units 12 and 13, which we registered in 2018 and which had a $53 million after-tax impact, net income grew in 5%. These results are mainly driven by the new regulated PPAs, and other smaller PPAs signed in 2017 and 2018 together with savings in operating expenses, as part of our Lean program.

Physical energy sales increased 12%, while our spot energy purchases increased 13%. During the first 9 months of the year, we supplied our clients with 37% of spot purchases. If we had the bridge PPAs, these hedging ratio increased to 46%.

Our EBITDA in the first 9 months reached then $279 million, slightly exceeding the full year EBITDA figure reported in 2017.

Let's turn now to Page 12, please. In this graph -- or this graph better explains how we are supplying our clients between our own generation, spot purchases and the bridge PPA. One, spot purchases remained -- been an important source of supply for our contracts, as you can see in this graph. Second, bridge contracts met a little more than half of the regulated demand in the center, as expected and as part of our hedging strategy for this year. Third, units 12 and 13 further reduced their relative contribution and they have been displaced to the last position in the dispatch ranking producing only 3%, as you can see in the graph to the right. Once we have IEM in full operation, of course, we could expect these 2 units will be completely displaced out of the dispatch ranking, and that's why we are closing them next year.

Then once IEM begins operation in the first quarter of next year, we expect to start receiving capacity payments. And as I mentioned before, units 12 and 13 will be completely displaced and IEM will also replace part of our spot purchases during next year. But considering that, our contracted demand will also increase during next year, we could expect that that the total -- or that this graph could remain stable during the next quarters of 2019.

And finally, the average realized monomic price in the first 9 months of the year was $115 per megawatt hour, while the average supply cost, including all direct charges, was close to $65. So we keep a relative average like in the previous quarters.

Pages 13, 14 and 15 illustrate one of ECL's main strengths, our excellent client portfolio and the average 12-year duration of our PPA portfolio. During the first 9 months of 2018, we signed new PPAs for a little bit more than 500 gigawatts hour with a duration close to 9 years and an average energy price slightly above $47. So these new contracts will be added to our existing portfolio. And that's why you can see in the bottom of the graph that the 2 free client areas in the north and in the center are bigger in this quarter than in the previous year. We'll continue with our commercial efforts to continue increasing our client base and adding our projects and solutions to these clients.

Just a reminder of what we already discussed in the previous 2 calls, on Page 14, we present the main changes related to the PPA renegotiations announced last April. These include 3 different sizes. The first one considered a short-term discount in the PPAs. The second includes an additional discount, together with, what we call, contract decarbonization, which, in simple words, means to change the indexation from the current formula that includes coal to only CPI. The third phase consists of a new contract based on current market conditions applicable to our important clients like Codelco and Glencore.

The end result is that we have extended the average life of our PPA portfolio, leaving behind the price indexation to coal. This triggers the need for new investment in renewables, which will gradually replace our thermal capacity once this thermal capacity reaches the end of its economic life.

The chart on Page 15 presents a summary of our portfolio by type of contracts. About half of demand in 2019, which we are expecting to reach about 12 terawatts hour will come from regulated clients corresponding to the blue and light blue areas in the picture. The other half corresponds to our free clients. The green area shows the PPAs that were renegotiated around 3 terawatts hour, as detailed on Slide 14.

Beginning 2021, the contracts included in the green area of the graph will be decarbonized or fully indexed to CPI. The supply to meet this contracted demand will come from new developments of renewable power, which is the essence of our transformation plan. Throughout this year, our development team has continued working on bringing at least 2 projects to our ready-to-build stage by the end of this year. And whilst we expect to share more details with you in the upcoming months, what we can mention about this is that in the case of 2 solar projects, our environmental permits were confirmed and this is one important milestone for next year and to be ready in case we want to launch the construction of our first renewable projects in 2019.

The regions in which we are developing these solar PV and wind projects are shown on Page 16. Our Calama wind farm has environmental approval and we are negotiating turbine purchases with some contractors, doing some market reads and moving forward with this project, which should become one of the first to move into a construction phase. However, as we have previously said, time-to-market decision will be important since the investment costs could change over time based on market conditions, interest rate, demand for turbines and further technology improvement. So we need to be flexible in terms of when to take the decision.

Page 17 provides details of the transmission projects awarded to ECL, the National Transmission auctions. The total investment of these 3 projects will be close to $40 million. They will require around 2 years for construction and the AVI will be close to $1.5 million. These projects were interesting for ECL because: first they are located in areas in which we can create synergies; second, they are linked to our renewal portfolio under development; and third, they will contribute to increase our regulated revenues. In this quarter, we also want to highlight the commercial operation of our new port, Puerto Andino. This project requires a total investment of approx $120 million. This is a mechanic port with the ability to receive Capesize carriers or, in practical terms, ships that can transport more than 180,000 deadweight tons. The picture on the right shows the first Capesize carrier that arrived to Puerto Andino some weeks ago. The benefit, of course, is related to economies of scale, higher unloading speed, lower demurrage cost and therefore lower cost for ECL.

But, as you can imagine, the full capacity of this port will not be used for coal unloading, considering this port was also designed for the potential needs of a second coal units similar to IEM.

So therefore we are currently negotiating and looking to different alternatives in parallel to optimize this asset. We believe the overall additional income we can create with the state-of-the-art ports like Puerto Andino could be close to around $5 million. We have appointed a development team and they are working on these different alternatives.

Page 18 summarizes the operation of our new port in Mejillones, Puerto Andino. Since it began its test late last year, almost 1.2 million tons of fuel, including coal and limestone, have been downloaded from 19 vessels. So this -- the good news is that this port is ready and working in the efficient way we were expecting.

Now please turn to Page 19. Since we are in the last phase of IEM's commissioning and Puerto Andino is already in operations, our CapEx financing needs have been considerably decreased, releasing balance sheet financing capacity for ECL. We may be able to finance at least $700 million of new investments in renewable capacity to additional debt, while keeping our leverage ratios under control.

In terms of guidance, please move to Page 20. We are pleased to confirm that ECL is delivering strong results as expected. Therefore, we maintained the guidance provided early this year with only a minor adjustment in our expected EBITDA for 2019, which is mainly explained by the delay in the full interconnection. We have also seen that hydrologic conditions for 2019 will not be very good. And third, coal prices are moving up. So between these 3 impacts where we want to adapt a little bit our guidance to have them top of mind and continue monitoring the impact of these 3 variables in our results during 2019.

To the left side of this slide, we show the main variables that may impact our results, depending on their behavior. Although, at the time of preparing our forecast, we normally use quite conservative assumptions. For example, in relation to our PPA portfolio, there are 2 effects, a positive impact of the new regulated PPAs and a negative impact related to the short-term discounts. In terms of spot prices, as I mentioned before, an increase in coal prices and drier hydrology would have a negative impact, which, in fact, is materializing for 2019, as I said before.

In terms of our power supply, further delays in the full interconnection and -- or IEM's COD could have a negative impact since we will continue to rely on spot purchases to meet the demand under current contracts. However, the closure of units 12 and 13 have a positive effect on our operating costs, while the bridge contracts provide an excellent hedge against spot prices. In terms of demand, we are closely following the immigration of clients from the regulated to deregulated segment. To prepare our guidance, we had already used conservative assumptions in this regard. We are also monitoring longer-term demand trends in terms of demand from the mining industry and the development of electric mobility, which also could be important driver for the future demand.

And finally, regulatory changes, such as green taxes can always impact results. The actual results or the actual impact of green taxes, of course, is negative since its implementation.

Once again, I want to finalize this section saying that we are very happy to confirm that our guidance has been met and we'll remain committed to deliver positive results going forward. We expect in the next quarter to confirm our guidance for 2019.

And now we'll move to next section. We'll talk about our financial results. So I will let Bernardita to give you more details on our financial results for the 9 months of the year.

[Bernardita Infante, executive]

Okay. Thank you, Eduardo. Hello, everyone. Please turn to Slide 22. As Eduardo just said, our results continue to be in line with our guidance for the year. Our EBITDA grew by 39% to $278 million. And the main drivers behind the EBITDA improvement were, of course, first and most important, the new PPA with distribution companies. These contracts contributed additional physical sales of 1,266 gigawatts hours, which translated into $135 million in additional revenue. Second, we reported a decrease in physical sales to unregulated clients, mainly due to the end of the Radomiro Tomic PPA in August of last year, which was partly offset by higher demand from other mining clients and sales to new clients.

Lower physical sales to free clients had a negative $10 million effect on EBITDA. Third, in terms of contract prices, we reported a positive net impact of $16 million. However, this is a result of movements in different directions. For example, the PPA renegotiations closed since late last year had a negative impact in the surroundings of $15 million. However, this figure was affected by several effects that caused an increase in revenue. The main one was the tariff indexation resulting from increase in fuel taxes, which had a positive effects on revenue. For example, average coal prices increased 13% to $92 per ton in the first 9 months of 2018. We also reported a positive variation in terms of sufficiency capacity provision. And finally we received $5 million in onetime payments upon the closing of the PPA renegotiations. Fourth, we reported higher energy purchase costs to supply the new contract with distribution companies mainly. So our physical energy purchases increased by roughly 1,000 gigawatt hour in the first 9 months of the year with an estimated net effect of $53 million over our EBITDA. Between March and August, spot prices were generally higher because of dry weather conditions in Central South Chile and also because of higher fuel prices, particularly coal. Our bridge PPAs with the other generation companies partially mitigated this effect. And also this net figure of $53 million includes a positive impact, which was a decrease in the net over cost. Fifth, the contribution of other businesses, including transmission and gas sales decreased by $18 million compared to last year. The main effect was related to positive reliquidations of tolls, okay, reported the year before and delays in the transfer of energy with Glencore to prices. Sixth, other positive effects on EBITDA included $6 million related to our 50% share in TEN's net income, which we compute in our EBITDA calculation; A $3 million insurance recovery for business interruption related to a past lost at our CTM3 plant; and $1 million net reduction in operating cost. In sum, a positive period with a 12% increase in physical sales and the 39% increase in EBITDA.

If we go to Slide 23 and look at the highlighted area in the center of the slide that shows the evolution of net recurring income, we can see that net recurring income almost doubled and reached $121 million in the first 9 months of the year. This was primarily explained by the stronger operating performance. Interest expense decreased a little as we continue to capitalize interest expense in our IEM and port projects. However, as discussed in the second quarter call, we reported a $52 million nonrecurring after-tax loss related to the impairment of the 2 coal-fired units, #12 and 13 in Tocopilla, which we plan to close in 2019. We also had some nonrecurring insurance recoveries in both periods. In 2017, a positive $8 million after-tax impact related to property damage at the Unit 16 combined cycle gas plant; while in 2018, it was $5 million in after-tax insurance recoveries related to property damages at Unit 16, CTM3 and the regular [PV] Plant. Even after considering these significant nonrecurring effects, net income increased 5% to almost $73 million.

Now please go on to Slide 24. The evolution of our net debt shows our main cash flows during the first 9 months of 2018. Our net debt increased 5% from the beginning of the year to $811 million as of September 30. Our main uses of cash during this period were: a, capital expenditures of $161 million, mainly related to the IEM project, and please note that this number does not include interest expense; b, dividends of $36 million, including $7 million paid to our partner in CTH; and c, income tax payment for $28 million. These cash uses were primarily financed with operating cash flow which reached $280 million.

Now our gross debt increased basically due to 3 things: One, we signed a 20-year tolling agreement with TEN for the use of dedicated transmission assets connecting our power plants in Mejillones with the national grid. The agreement has a present value of approximately $60 million and considers annual tolling payment of approximately $7 million. At the end of the 20-year period, ECL will become the owner of these assets. So accounting-wise, this is a financial lease and it's not considered financial debt. The transmission assets are accounted for as fixed assets on ECL's book. Two, last April, we took 1-year loans totaling $50 million with Scotiabank and Banco Estado. With this, our short-term debt climbed to a total of $150 million in last April, okay? But then in July, we reduced our short-term debt by $35 million to a new total of $116 million. As we refinanced $75 million in loan -- in bank loans maturing in July with 1-year $40 million loan with Banco Estado. Our cash balances on the other side increased by $29 million, thereby, partially offsetting the increase in net debt. And three, accrued interest and mark-to-market variations on FX hedges contributed to a $36 million increase in net debt.

Finally, I'd like to mention a $20 million cash payment from TEN in early October after the cut-off date of this presentation. TEN achieved project completions, which is an important milestone under the terms of its loan agreement, and total project costs were below those initially agreed with the lenders. So this leave origin to a final loan disbursement called a cost underrun advance, which TEN used to distribute to its shareholders. This is why ECL received $20 million in early October .

Now Slide 25 provides details of our liquidity and debt structure. Net debt to EBITDA decreased to 2.3x despite increase in net debt and this is obviously because of the added bank profit. Last 12 months EBITDA was $354 million, up from $276 million in 2017. So we expect the net debt-to-EBITDA ratio to remain below 3.5x during the coming quarters and years probably, as EBITDA should continue strengthening and we do not expect that to increase significantly from current levels. Actually in October, beyond this -- the cut-off date of this presentation, we repaid at maturity of $25 million short-term loan with Scotiabank, reducing our -- further our short-term debt to a new balance of $90 million. We have an available committed revolving credit facility maturing in June 2020. We have not used this facility so far and we have requested the bank to reduce the commitment to $100 million beginning November 5, that is yesterday. We believe this level still provides the strong liquidity cushion as we have 1-year debt, with lower cost and we then have drawn our liquidity facility.

In terms of credit ratings, both S&P and Fitch have confirmed ECL's rating at BBB stable. Fitch upgraded ECL's national scale ratings to AA- last June.

If I move to Slide 26, this gives information on our dividend policy, market capitalization and spot price evolution. As you know, our dividend policy is flexible. In the last 3 years, dividends have been limited to 30% of net income, which is the minimum allowed in Chile to support our CapEx expansion. But as we approach the end of our 2015-2018 CapEx financing program, and since we received this cash payment from TEN, we decided to pay a provisional dividend of $26 million on October 25 on account of 2018 net earnings. The final dividend payout ratio for 2018 will depend on the company's cash availability and financing requirements. But it is quite likely that we pay dividends -- the percentage, the payout ratio will be calculated based on net recurring income and not net income, which would be the equivalent of the $120 million we reported instead of $70 million

We reported this year.

This is all on my side, and now I'll leave you, Eduardo, to wrap up the presentation.

[Eduardo Milligan Wenzel, executive]

Thank you, Bernardita. To conclude this presentation, I just want to highlight 3 important messages for this quarter. First, we are glad to confirm that the IEM plan was successfully synchronized on October 29, injecting power to the grid for the first time and our goal to reach the maximum load and complete heat rate test during January 2019 to reach full COD during the first quarter of 2019.

Second, we signed around 10 new PPAs, representing a total demand slightly above 500 gigawatts hour with a 9-year duration during this year. These new PPAs represent an important increase in our total contracted demand or around 5% and our objective, of course, is to go for more. But we focus on the profitable cases, let's say.

And third, we are again glad to confirm the guidance we provided for 2018. We are still on track to reach 2019, while our CapEx-intensive program for 2015 -- 2018 descending and a stronger cash-generation phase is starting for ECL.

With this final message, we are concluding our 9-month presentation. We hope this presentation was interesting. And then well, thank you for your participation and we are ready for any questions that you may have.

[Operator]

[Operator Instructions] The first question will be from David Galante with Scotiabank.

[David Galante, analyst]

I have a question regarding EBITDA guidance, and I'm sorry if you talked about it during the presentation and I missed it. In the Slide 19, we can see that the EBITDA guidance for 2019 is lower and then it goes even lower to 2020, and when we compare it to the last quarter presentation, we would see that EBITDA will grow higher in 2019 and even higher in 2020. I was wondering if this is related to the restructuring of the PPAs that you -- that took place during the second quarter; and maybe during the quarter, you didn't update the presentation or was -- is there something else that happened over the last 3 months.

[Eduardo Milligan Wenzel, executive]

Dave, thank you for your question, but basically your question is about the guidance. We haven't given any guidance yet for 2020. The only update that we included in our presentation this quarter was a very small reduction of only $10 million for the 2019 guidance. But for 2020, we don't have any figures in this presentation, right?

[David Galante, analyst]

Okay. So in the guidance, so you're talking about the Slide 21, which you have 2017, '18 and '19 in the bar graph, right? But I'm talking about the Slide 19, which has a line -- a green line with the EBITDA estimate for 2015 through 2020; and on the second quarter of this year, on the presentation, we would have, in 2019, EBITDA guidance at around $460 million and then it would go up to something close to $500 million for 2020. And on this quarter, on the same slide, we have the green line in 2019 around $450 million, which makes sense because you reduced the guidance for this year, but then the line goes down in 2020 to something around maybe $430 million, $420 million, it's hard to know because it's a line. So I'm not -- exactly the number, but it goes down.

[Eduardo Milligan Wenzel, executive]

Yes, you are right. In 2020, what we expect -- or the impact that we will expect in 2020 is not the renegotiation of the PPAs, but it's mainly the end of Zaldivar PPAs which will end in 2020. So without doing anything from our side mechanically, the EBITDA should be a bit lower than 2019. However, this is something that we are using for budget purposes or to show a little bit our view on the debt capacity. But for sure our plan is to keep -- or try to keep the same result as '19. And this is something that, in fact, will change over time considering also the marginal cost evolution and hydrologic condition for 2020, et cetera. So once -- usually, when we forecast the long term, we try to use a conservative assumption on marginal costs like something close to be '19. Why? Because it was -- we have seen during the last 7 years in our market and this is something that could change and the impact -- or the impact in case, hydrologic conditions in 2020 are better, could be important. So this is just an idea of where our EBITDA should be, but there are some upsides in 2020 that we may have, but the mechanic, let's say, explanation of why in 2020 it's a bit lower than '19, is because of the end of Zaldivar PPAs with [Vedanta].

[Operator]

[Operator Instructions] This concludes our question-and-answer session. At this time, I'd like to turn the floor back over to Engie Energia Chile for any closing remarks.

Once again, I'm turning it back to management for any closing remarks that you may have.

[Eduardo Milligan Wenzel, executive]

Okay. Thank you very much for your participation and looking forward for our next call with you, hopefully to confirm our guidance for the year and to present you probably new updates on our development plan. Thank you very much.

[Bernardita Infante, executive]

Thank you. Goodbye, everyone.

[Operator]

Thank you. This concludes today's presentation. You may disconnect your lines at this time and have a nice day.