Inficon Holding AG

SIX:IFCN

Earnings Call Transcript 2020-Q3

[Operator]

Ladies and gentlemen, welcome to the INFICON Q3 Results Conference Call. I am Alessandro, the Chorus Call operator. [Operator Instructions] And the conference is being recorded. [Operator Instructions] This conference must not be recorded for publication or broadcast.At this time, it's my pleasure to hand over to Mr. Lukas Winkler, Chief Executive Officer of INFICON. Please go ahead, sir.

[Lukas Winkler, President & CEO]

Thank you, Alessandro. [Foreign Language] Good morning, everyone, and thanks for joining us today to review our results for the third quarter of 2020.The third quarter can be summarized with 5 bullet points: first of all, the ongoing COVID-19 impact on how we do business; secondly, [Audio Gap] semiconductor market development but still at a higher level than 2019; third, the rebound in all other served target markets after a relatively weak second quarter of 2020. Fourth bullet point is a disappointing gross profit margin due to several reasons. I'll come to that later. And last but not least, we expect a strong last quarter supported by a good order momentum. As always, you can find the PowerPoint presentation on the Investors Relations tab on our website. Please go to Slide #3 where we start with the key figures for the current reporting quarter. We closed the third quarter 1.3% below last year's third quarter and reached $92 million. Organically, this reflects a 3.4% decrease compared -- and compared to the second quarter of this year, a reduction of 4.4%. On the positive side, the order intake is picking up, and our quarterly as well as our year-to-date book-to-bill ratio is clearly above 1. With a disappointing low gross profit margin and stable operating expenses, we finished the quarter with operating income of USD 10.5 million after $16.3 million a year ago. This is 1/3 less than a quarter ago. Our net income was USD 7.9 million or 8.6% of sales.Later on, Matthias Tröndle will go with you through detailed figures. And now I go to the development of -- in our target markets.Now please turn to the next slide, #4, where you see the breakdown of our sales into the 4 markets that we serve. We've sequentially improved contribution from the RAC, Auto as well as General Vacuum markets. The pie chart looks very similar to the same pie chart a year ago with one exception: the expected lower contribution from the Security & Energy market has been compensated with higher sales primarily to semiconductor customers.The quarterly regional sales trends on the right-hand side shows lower sales to Asian customers, again, primarily driven by the sequential lower shipments into the semiconductor markets. Europe and Americas remained stable.Now let's do a quick analysis market by market. We start with the smallest one. In the Security & Energy market on Slide #5, sales decreased more than 25% year-over-year. The sequential increase of 74% looks impressive, but it's compared to a very low second quarter of this year. So overall, we are far behind our normal sales level, which has been expected and communicated since the beginning of this year.Our main customer in this market, the American Department of Defense, had no specific program for portable on-site chemical warfare detection instrument this year. And secondly, we are about to launch a brand-new HAPSITE product family at the beginning of next year and expect the U.S. government to be the first customer for this next-generation chemical warfare detection unit.We do also face some headwinds in China with this product due to the fact that Chinese agencies are not allowed to buy American-made products. As a consequence, we started to work with a Chinese system integrator who is using a OEM module to be built into a Chinese-made system.This quarter, again, we sold the majority of our products into the energy and environment market and enjoyed a nice sales growth with gas detection instruments in the bio-methane and landfill monitoring applications. Looking ahead, we expect a further improvement, especially outside of the main security applications, but we will end this year far behind the sales level of 2019.Now moving to the Refrigeration, Air Conditioning & Automotive market on Slide #6, with sales of USD 19 million, which represents a sales decrease of 5.5% year-over-year but enjoyed a 13.8% increase compared to the second quarter of this year, which had been hit by COVID-19 measures.Sales to traditional car manufacturers remained low, but RAC and refrigeration manufacturers started slowly to invest in additional capacity again, and the revenue of our after-sales service instruments even recuperated from some of the losses in Q1 and Q2.Last but not least, the e-cars and lithium-ion battery testing remained at an attractive level. As the preferred #1 supplier in this market, we are able to keep our high market share and expand into new operator-independent robotic leak checking applications as well as new ways to test the leak integrity of a variety of different lithium-ion car batteries. We expect a strong last quarter, but we will miss the record levels of the last 2 years on an annual basis.Now let's go to the Semi & Vacuum Coating market, which includes solar, display, optics and semiconductor applications on Slide #7, where sales increased 5.7% year-over-year and decreased 20.9% sequentially and reached USD 42.4 million.As in the previous quarters, the vast majority of our shipments went to semiconductor customers, while sales to OLED and optics customers are still behind 2019. Although the activities in China remained at a high level, we faced 2 main issues with chip manufacturers in China. First of all, going through a public auction process for our process monitoring solutions led to the current initial low gross profit margins since we decided strategically to win the majority of all Chinese chip manufacturers. And secondly, the U.S.-China trade issues as well as the war on technology led to some shipment and installation delays as well as a continuation of enforced import tariffs for U.S. goods, which had a negative gross profit margin impact as well.Outside of China, high-end semiconductor companies invest in new sub 10-nanometer technology that can only be reached with extreme ultraviolet lithography technology. Companies in the U.S., Korea and Taiwan are at the forefront of this latest technology node. These new chips, new materials and manufacturing processes are asking for more accurate process control and monitoring. We continue to work very closely with OEMs and end users to develop new sensors, solutions and software.The high level of R&D costs will lead to a large number of new products and instruments going into 2021 and will drive our sales to semiconductor customers to new levels. The fourth quarter is expected to be a strong quarter, and we push at all levels to get systems installed and accepted.Finally, we had a sequentially improved quarter in the General Vacuum market on Slide #8, with sales of USD 25.9 million, which is 3% below last year's third quarter but 11.6% above the weak second quarter of this year. As you know, we sell analysis, measurement and control products for many different industrial applications through private label partners, primarily vacuum pump manufacturers, and via direct sales channels to industrial OEMs and distributors.Especially in Europe, we saw a recovery after the first COVID-19 shock during springtime. During the lock time, it was also quite difficult to acquire new customers in the food packaging market since most of the trade show have been canceled, but we have been able to increase our sales with existing customers, especially within the coffee packaging market in Europe.Before I turn over to Matthias, I'd like to close my part of the presentation with an outlook on Slide #9. 2020 will remain a very special and challenging year with only one stable element, the uncertainty. Being able to adjust quickly, use agile and flexible methods and see every uncertainty as an opportunity to gain market share is what we do. Thanks to a healthy semiconductor market and the recovery of some other markets that we serve, we will end this challenging year with a strong last quarter. We cannot influence the global geopolitics, but we will do our best to keep our customers happy and successful.Given the positive order momentum and the current backlog, we leave our top line guidance unchanged at between USD 370 million and USD 390 million. And on the operating income, we expect to finish the year between 15% and 16% of sales.With that, I'd like to turn over to Matthias who will give you more details on the financial performance.

[Matthias Tröndle, VP & CFO]

Thank you, Lukas. Good morning everyone to our third quarter 2020 conference call. I will cover as usual our Q3 financial results and also comment our guidance for 2020.As always, let me begin with our revenue segmentation in the September quarter. You find this on Slide #11. Revenues for the third quarter of 2020 came out at $92 million compared with $93.2 million in our third quarter of last year. Total sales decreased by a minimal USD 1.1 million or 1.3%. Due to the weak U.S. dollar, we had a positive exchange rate effect of 2.2%, which means we had an organic sales decrease of 3.4%.Looking at the end market development, the Semi & Vacuum Coating market had a good performance and increased by $2.3 million or approximately 6%, while the sales to the other end markets declined. On a sequential basis, and shown in the chart on Page 11, sales in the third quarter decreased by 4.4% compared to the sales level in previous quarter, Q2. The decrease is exclusively caused by lower sales to the Semi & Vacuum Coating market after the strong 26% increase and the record level we had in Q2. All other markets recovered from Q2 levels and increased between 12% in General Vacuum and 74% in Security & Energy.On a geographic basis, Europe reached 30%; North America, 29%; and Asia Pacific ended with 41% of total third quarter sales. As you can see in the chart, Europe and Asia developed more or less stable, and North America did drop by approximately 4%. Compared to previous quarter, Q2, all markets, except Semi and Vacuum Coating, did grow in Europe and Americas. Asia dropped minus 13% mainly caused by Semi and Vacuum Coating where levels reduced after a huge jump in sales in Q2.Let's go to Slide #13. The gross margin for the third quarter of 2020 reached 45% compared to 49.6% in the same quarter of last year. The margin percentage decreased significantly by 466 basis points. Besides various COVID-driven inefficiencies in materials productions with some process changes we had to do and logistics, the product and market mix in the current -- and the current price pressure in China did drive the gross margin down.Moving on to our operating expenses. R&D expense in the third quarter reached $9.7 million. We continue to invest to support future product launches and push ahead with our strategic projects. The costs increased by 10.2%. SG&A expense did develop stable and ended at $21.1 million. As a percentage of sales, this represents 23%.Let's turn to the bottom line. For the third quarter of 2020, we achieved income from operations of $10.5 million or 11.4% of sales. This compares with income from operations of $16.3 million or 17.5% in last year's third quarter, which means the result had decreased clearly by 35% compared to last year.Let's go to the next slide. For the third quarter, we recorded tax expense of $2.4 million, which represents an average tax rate of 23.4%, stable compared to last year's tax rate of 22.7%. As a result, the net income reached $7.9 million or 8.6% compared to $12.4 million or 13.3% in the same quarter last year.The third quarter income equates to earnings of $3.24 per diluted share compared with net income of $5.10 per diluted share in the same period last year. The decrease for both net income and EPS is caused by the decline in operating income.Now let's move to the balance sheet highlights on Slide #15. Our net cash position was $25.7 million, this compares with $50.1 million at the end of last year, which means a decrease of about $24.4 million. Main driver for the decrease is the $45 million dividend payment we had in April this year. As a better comparison, last year's Q3 net cash was at $29.1 million, a difference of minus $3.4 million. The slightly lower cash flow generation due to higher working capital balances is the main driver for this slightly lower cash position.The operating cash flow, which you can also see on the slide, did improve versus previous year and also did improve versus previous quarter and reached with $15.5 million, a solid level.For the third quarter, our accounts receivable ratio, day sales outstanding reached 50.9 days and was better than the end of last year, also better than in our previous quarter 2. Payment morale and behavior of our customers continued to stay good despite these tense times with the pandemic and other influence factors.Inventory reached 2.7 turns. The working capital level increased mainly due to higher accounts receivables and inventory numbers, partially compensated by our higher accounts payables.Looking at the balance sheet structure, the equity ratio reached approximately 65% in Q3 after 76% in Q4, and as another comparison, more or less at the same level as 1 year ago in Q3 '19 where we had 66% ratio. We have no material long-term liabilities and a net cash position of $26 million, which confirms a solid balance sheet structure.With that, I covered our current quarter results. I conclude my portion of the call with the guidance.Finally, as we move ahead now in the fourth quarter, I would like to comment the guidance. Many things in the world are still moving around and our fragile business environment, global trade and the pandemic are still hard to predict. But due to improved order situation, the strength of the semiconductor market, we assess the outlook for the coming quarter cautiously optimistic. Based on that, we expect sales of $370 million to $390 million with an operating income margin of 15% to 16%.The last slide shows our corporate calendar and the upcoming dates. And this concludes the formal part of the presentation, and we are ready to take your questions.

[Operator]

[Operator Instructions] The first question comes from the line of Jörn Iffert from UBS.

[Jörn Iffert, Director and Analyst]

The first one would be based on your profitability outlook for Q4 and in the lower end, it's reflecting a significant improvement on EBIT margins versus Q3. Can you tell us where it is coming from? Is it really already a strong gross profit margin recovery? Or is it more SG&A cost discipline?Second question would be, please, on your overall gross profit margin impact we have seen now in 2020 of around $10 million. Can you split this into tariff impact and the pricing pressure impact as an extra cost you have? And how fast you can recover this in '21, '22?And then the third question, please. On Semi, you mentioned you see the memory market to be more volatile or you see mixed signals. What do you expect here for '21 looking on your -- and feedback you get from your sales teams on the ground?

[Lukas Winkler, President & CEO]

Thank you, Jörn. It looks like you're always the first one who is allowed to ask questions. Why that's the case, I don't know. Now let me go into your questions.Gross profit margin outlook for the last quarter. Our operating income outlook is clearly based on improvements on the gross profit margin side, not on the operating expense side. So we are looking to finish the -- to end the last quarter with gross profit margin closer to the 50%, not reaching 50% but closer to 50%, and that's what we see currently.And as you know, we had several impacts why we had this gross profit margin drop, and that's the main part of your second question, how can the $10 million or roughly $10 million be split. I do not know the exact figures, but at least I can tell you that for all impacts, we are talking about more than $1 million impacts on tariffs, on the price pressure, on some COVID-19 issues, especially on the material side and some inefficiencies in our processes going to second shift and then the special shift payments. And if you add up all that, you get cost that you mentioned.And what had the single biggest impact? I'm not 100% sure, but I would assume it's the -- maybe Matthias knows it better. He usually has the figures.

[Matthias Tröndle, VP & CFO]

China.

[Lukas Winkler, President & CEO]

It's the China impact on tariffs and on price pressure. And only #3 are the COVID-19 inefficiencies.And so the third part of the question, what can we expect in the memory market? We don't know exactly, but what we see is that there is at least some movement going on. Even Samsung announced that they first pushed out some investments into 2021. But now it looks like they are really serious about doing it in 2021, so we might see some recovery in the memory market in 2021.And as you know, especially the Chinese manufacturer will continue to make memories. Now they're even looking to go into some of the foundry business, which is a little bit more complex. But on the memory side, the Chinese manufacturers will continue to invest. So from that point of view, I assume, or at least we assume, that the memory market in 2021 will be above 2020.

[Jörn Iffert, Director and Analyst]

May I follow up, please, on the gross profit margin question for Q4? I mean your gross profit margin is suffering now in Q2, Q3. How is it possible that you so quickly can recover in Q4? Have you increased price points? Or are the tariffs falling away? Or what is really happening here? And is this 50% or close to 50% gross profit margin level now also sustainable going into '21?

[Lukas Winkler, President & CEO]

First of all, I think there are 2 effects that we see. One is clearly product mix with more revenue coming from the semiconductor market in the last quarter. The profit -- the product mix goes to higher gross profit margin products, first of all. And secondly, we had some -- I would then call them kind of small onetime impacts in Q3 with some cleanup activities that we went through. In order to improve the gross profit margin, you also find some things that you have to clean first, and that's what we did. And so not having those onetime impacts anymore and the better product mix will lead to a better gross profit margin.Yes, we believe that we can keep a certain level close to the 50% mark, but it's still our target to, again, get over the 50%. And I think with some of the new products that we will launch in 2021, which clearly have an above-average gross profit margin, we should be able to get closer to 50% again and keep that level on a sustainable level.

[Operator]

The next question comes from Michael Foeth from Vontobel.

[Michael Foeth]

A few questions from my side. The first one's regarding semiconductor as well. This big swing that you had between Q2 and Q3 in the semi space and this inventory replenishment or catch-up that you talked about, which products were mostly affected and which products sort of are the reason that you had this drop in the third quarter?And then leading to the next question, which type of product or, let's say, which type of customers are expecting to generate the higher sales in the fourth quarter? That would be the first one. So explaining that swing.And the second one would be if you could actually give some rough idea on the exposure that you actually have to the Chinese semiconductor market within that sort of end market. And the last question would be regarding your sales guidance. The $370 million to $390 million, that's still a pretty huge range when you consider just 1 quarter. So my question would be what are the swing factors between the lower and upper end of the guidance?

[Lukas Winkler, President & CEO]

Okay. Thank you, Michael. Let me try to explain as best as I can. The swing that you mentioned between Q2, Q3 can be clearly allocated to [Audio Gap] and I'll start now with the customer type and then going back to the -- what product is used there. It's driven by our end-user business more than on the OEM side.And having said that, it's primarily in the end user business in China with some delays due to some hurdles in the administrative kind of approval of process to get imports and exports into -- in and out of China and have some, I would call them, end-of-quarter effect that led to some, I would say, delays in acceptance tests primarily in China. And having said that, because we talk about end user business, it's the product line that deals with those yield enhancement solutions that we sell to the end user chip manufacturers.On the OEM side, the business was basically flat. No improvements, just flat. And even the shipments to our lithography customer remained at a high level but flat.And now exposure into China, as you -- based on our answer on the first question already, you can see it's going up. It's going up very quickly on the end user side, but it's also growing on the OEM side. We see now competitors of companies such as Applied Materials and Lam and so on starting to generate revenue in China in order to get around this -- the war on technology.And therefore, the exposure overall in the -- to the Chinese semiconductor market, I do not know exactly the figure, but it's probably in the neighborhood of reaching more than 20% of our semiconductor business goes directly to China. Indirectly, it's even higher because we do not know exactly where our OEM customers ship their products. But if you look into some of the press releases from especially Applied Materials or Lam Research, you can see that their exposure into China is starting to get larger as well. And so indirectly, our exposure to China is even more than what we see direct in our books.Now coming to your third question, what -- why do we have this relatively large range? There are 2 main reasons. One, again, coming to the semiconductor end user business in China where we depend heavily on acceptance tests and on revenue recognition timing and doing the installations. And that's true for all semiconductor end users, but it's most critical in Taiwan and in China where our revenue recognition depends very much on the acceptance test at the end user side, not so much with Korea and not so much with Europe and the U.S. That's the first big swing factor.And the second swing factor comes from some other activities in China where we depend on getting export licenses primarily in conjunction with some security-related products that we have in the books but have not recognized revenue yet and have not even got export licenses for all products. And this process became much more cumbersome over the last few months. And so we have to apply for export license, not just for security products but also some customers in the refrigeration markets are listed on this strange -- how do they call it? We call it internally the black list, but the official title is differently. And the customers are listed on the U.S. export control restrictions, and we have to get licenses even for some leak detector for refrigeration markets, and that creates this big kind of range between $370 million and $390 million.

[Operator]

[Operator Instructions] The next question comes from Marta Bruska from Berenberg.

[Marta Kinga Bruska, Analyst]

I would like to ask you if you could please explain a little bit more about what are those process monitoring solutions that you sell into China that suffered in the gross margin? And is it basically hardware, software or a combination of both?And could you also remind us, please, if I remember correctly, was that since 2019 when the tenders appeared and started to become a problem for the gross margin? And what was the reason that they appeared at that particular point in time, please?

[Lukas Winkler, President & CEO]

Okay. Thank you, Marta. Those product lines that we sell are not simple plugging -- plug-and-play products. Those are typical systems or solutions, which is a combination of a couple of different sensors, a lot of software and application support that we do on-site. So we always talk about a few million per fab line. It's not just a few thousands. And that's what we sell. So it's primarily around gas analysis for high pressure, low pressure based on either a mass spectrometer or optical sensing technology, together with some very advanced software packages and, as I mentioned, on-site engineering support.Now you call it a problematic gross profit margin. Yes, it is very low. But from our point of view, it was a clear strategic decision to participate in those auctions. And we did win the majority of the bets. And we believe that this initial low gross profit margin really is the price to get into the account and that the follow-up orders will not have that low gross profit margin anymore. And in fact, we have already seen that at least in one case, not in all cases yet.And why did it happen, so, let's say, dominant in Q3? Because now we made those shipments. The auctions took place much earlier, of course, but in Q3, we had 2 larger installation shipments that we made that went through this auction. So it was kind of an initial shipment that we made in both cases. And I cannot disclose the name of the customers, but there are not that many in China, so you can maybe guess.And does it -- will it occur later on? We assume not. We know that we have still one of those larger accounts in the books that probably will be shipped in Q4. But beyond that, we have follow-up orders now, which has already a higher gross profit margin than the initial setup that we offer. So therefore, this was a clear strategic move, and we knew that we will suffer on the gross profit side. And we assumed that based on the history with those customers, that it will go back to normal levels of gross profit margins once we have -- win the account.

[Marta Kinga Bruska, Analyst]

That's very helpful. Just that I understand that correctly, that sounds like those solutions are very specific for China and very specific for those customers that basically as a new product altogether. Is that the right way of thinking about it?

[Lukas Winkler, President & CEO]

No. No, that's not correct. It's a very similar solution that we offer also to the non-Chinese semiconductor customers. It's just that those customers are brand-new customer for us. So it's always the first installation that we had to go through an auction.

[Marta Kinga Bruska, Analyst]

Okay. Okay. And why this started in 2019 versus when you sell to China before? And we somehow didn't hear about this sort of a more condensed auction issue. So I just wanted to understand what triggered this change basically.

[Lukas Winkler, President & CEO]

It was a clear decision that we made...

[Marta Kinga Bruska, Analyst]

Okay. So you wanted to become more aggressive and to get...

[Lukas Winkler, President & CEO]

Absolutely.

[Marta Kinga Bruska, Analyst]

Okay. Now it's...

[Lukas Winkler, President & CEO]

Our goal is to get to 80% market share in China, and that's what we believe we can reach.

[Operator]

The next question comes from Serge Rotzer from Crédit Suisse.

[Serge Rotzer, Research Analyst]

I have 2 quick ones. The first one is about, last year, you also reiterated its guidance the same time. But at that time, you said it's uncertain whether all orders will come. And at the end of the day, you missed the guidance. Therefore, the question, how sure are you that you really can deliver? And is there no postponements or whatever? This is the first question.

[Lukas Winkler, President & CEO]

We can, of course, not give you a full guarantee, but you can -- there are 2 facts basically that we -- that makes us feel very, very confident. First of all, the range is quite large. And secondly, the order momentum is very positive. And so based on those 2 facts, we are very certain that we are within the range. Where exactly we end up really depends on the timing of shipments and revenue recognition. But the fact that our order momentum is very positive, first of all, and as I said, the range is quite large, we should be within that -- with a high certainty be within this $370 million to $390 million range.

[Serge Rotzer, Research Analyst]

Okay. It's not dependent on 1 or 2 single bulk orders in that case, like last year?

[Lukas Winkler, President & CEO]

No, it's -- we have, of course, always a few of them, but they are not as huge as last year.

[Serge Rotzer, Research Analyst]

Okay. Got it. And then probably, we are a little bit early in the year, but the consensus is expecting growth of about 12% to 13% for next year. I know that you can't comment that, but probably in general, as you're a little bit prudent on memory, where is growth coming from next year? Is it more the recovery of the non-semi divisions? Or do you believe still in a strong growth in semi, looking into your crystal ball?

[Lukas Winkler, President & CEO]

My crystal ball tells me that the semiconductor will continue to behave well, and on top of that, as I mentioned at the beginning of the call, we have a bunch of new products that are new, so -- which are not depending on market growth, which are really depending on new applications and further enhancements in the range of processes that we can come up with our instruments. So the growth in the semi has 2 sides: new applications as well as market growth itself. And I expect certainly a recovery in the security market.

[Operator]

[Operator Instructions] The next question comes from Rolf Renders from Helvea.

[Rolf Renders, Research Analyst]

I have 3 questions. One is what you mentioned on the war on technology. And in that respect, you -- can I just first check a number? You mentioned something of semi exposure in China, 27%, but then on top comes the indirect part. Is that right? So is it like 30% to 40% semi, China?

[Lukas Winkler, President & CEO]

I did not say 27%. I said above 20%. That's correct. Within the semi exposure, it's more than 20% goes to China directly. And indirectly, we don't know exactly. But assuming that from the indirect part, a good percentage goes to China as well, it could be as high as 30%. There's one large exception maybe. That's the -- everything that we ship to the extreme ultraviolet lithography market does not go to China.

[Rolf Renders, Research Analyst]

Okay. That's understood. Because several articles have been indicating that because of this war on technology, the Chinese have been stockpiling or hamstering products. What's your view on that? Do you recognize that? Or is that outside of what you are doing?

[Lukas Winkler, President & CEO]

We believe that a part of the growth is coming from the stockpiling. We don't know how much, but I share that concerns with some of these articles.

[Rolf Renders, Research Analyst]

Okay. And then you indicated you expect a strong Q4 in semis. Is that similar strong then as the past Q2, which was extremely strong?

[Lukas Winkler, President & CEO]

I don't know the exact details, but I would have to dig in the figures to give you a better and a clear answer. I don't know yet at this point in time. But it will be -- let's say that -- I don't -- in other words, it's not just depending on semi, [ other world markets are recovering apparently. ]

[Rolf Renders, Research Analyst]

Okay. And then on the Security segment, when do you -- so it's now, for logical reasons, in the U.S. low and there's new product launch to come. When do you expect it to be around the levels we've seen in '18, '19?

[Lukas Winkler, President & CEO]

Probably in -- not before 2022.

[Rolf Renders, Research Analyst]

Okay. Great. Yes, no further questions. Have a good fourth quarter.

[Lukas Winkler, President & CEO]

Thank you, Rolf. We can always use the good wishes.

[Operator]

Ladies and gentlemen, this was the last question.

[Lukas Winkler, President & CEO]

Okay. If there are no more questions, then I simply like to thank you all for being very active in this conference call, and I'd like to talk to you again once we have finished our last quarter, hopefully, on a very positive note.Thank you very much, and have a great day. Bye-bye.

[Matthias Tröndle, VP & CFO]

Thank you.

[Operator]

Ladies and gentlemen, the conference is now over. Thank you for choosing Chorus Call, and thank you for participating in the conference. You may now disconnect your lines. Goodbye.