Boliden AB

STO:BOL

Earnings Call Transcript 2018-Q2

[Olof Grenmark, Director Investor Relations]

Ladies and gentlemen, I would like to welcome you to Boliden's Q2 2018 Results Presentation. My name is Olof Grenmark, and I'm Head of Investor Relations.Today, we will have a results presentation led by our CEO and President, Mikael Staffas; and our CFO, Håkan Gabrielsson. After their results presentation, we will have a Q&A session.Mr. Staffas, the stage is yours.

[Mikael Staffas, President & CEO]

Thank you, Olof, and good morning, everybody, very good morning to all of you. I would like to go through this presentation here, and then give you the chance to answer the -- ask the questions afterwards.We've had a good second quarter, which has been characterized mainly by stability in terms of production, and that's been true both for the mines and the smelters, and I'll come in a little bit more into details regarding that in a little while. But first of all, the price and terms have been quite good. They were good for us all through the second quarter. And even though there's been some development early in the third quarter, it does not reflect in the numbers for the second quarter, of course.And that's -- we've been good, and then with the help of that, we've had good results in the mines despite the fact that we've had lower grades in Aitik and Tara. But this has all been well communicated that we had exceptionally high grades in Q1 for those -- particularly those 2 mines.In smelters, I'm particularly pleased that we've had a very good production. It's a quarter that you all know about that's very high in maintenance and maintenance stops, and when you maintenance in a smelter. You can always be nervous about what you find when you open up some of these places where you'd normally not go, but we've had a very good run this time. All the maintenance stops have been on time and on budget, and we're quite happy with that.Now something that has not been quite so good and it's been on the cost side. And as equally as we're happy with the good price in terms of metal prices, there is a flip side to that, and that has to do with energy and has to do with chemicals where we are feeling a pretty strong cost inflation right now. That is explained, in large part, of the cost increases that we've had in the quarter, especially compared to last year.In terms of the numbers, we ended up on SEK 2.3 billion, a little bit more than that, which is a number that we feel quite comfortable with in this situation. The free cash flow was also strong at SEK 1.7 billion.If you look at the macro market, as I said, during Q2, we've seen a very good market. We saw very good zinc prices, also high copper prices and a nickel price that was quite good, we had favorable exchange rates, and we've seen a strong output. And when we look at our strong demand, I should say, and a strong industrial output in the world, and that's what's also been reflected in these numbers. And there's also been a healthy growth in the demand for all the metals, especially nickel. Even though you can see it coming from lower levels, we've seen a very good year-on-year development in nickel demand.On the concentrate side, there is still a tightness in the zinc concentrate market. It's been shown, although the mine supply has been increasing in the world, and there's been a modest increase in the copper concentrate supply.If you look at the prices, especially if you look at them during Q2, you can see that the zinc price is still quite high compared to the cost levels in the industry, and so it's also true for copper whereas nickel has now [ got ] to the levels where it's possible to make some money for the participants in the industry. You can also see here, but just may be interesting for you and a statistic that we have, that the costs for copper mines in the world is going up, even though it's a little bit small. You can see that it's ticking up and that probably also just as in our case related to increased prices for energy and chemicals.I spoke about the metal prices. We've seen a good development. On this slide, you can also see, however, that the prices are heading down pretty sharply towards and mainly after the end of the quarter. So zinc, from a very high level, going down; copper, from a quite decent level, also going down; and nickel, from a level that's come up is also coming down. But all in all, during the quarter, we had very stable and good prices.So if you look at that in terms of the Boliden index and what, where we are heading on this one, you can see that even though there's a little bit of a setback going down in the prices in U.S. dollar terms with the exchange rate added to that, we continue to have very favorable market terms.If we go into the specific areas or the 2 business areas, we can start with the mines, or maybe I should stop once -- I don't know to what extent you're sitting on, on what kind of quality of line, but you can see here now the new KiD2 crusher or the new surface crusher, and it's a little bit of an interesting picture that you see to the left. That's -- you can see on the surface just a very small part that you see on top but also how much [ that ] comes underground in this crusher, where are all the action is actually happening underground. The total height is over 70 meters, but it's only the first -- the 10 meters that you see on top of the ground, the most is going underground.I'll come back a little bit to it, but I -- or maybe I should tell you right now that the installation's worked out very well. We're up and running. It took, as always, some capacity to put in a new installation of a new crusher. That means that you have a couple of days where you don't have any crushers in place, as you're changing over your conveyor belts, but that has worked out fine. And so far, everything has worked according to plan. Now the real trick with this crusher is not the first week or the first month, well, maybe not even the first year. I mean, the big reason why we built this crusher is because we need to have a higher reliability and a higher availability than we had with the old crusher that had all kind of maintenance problems. And that's, of course, not going to show in the new one in the first month or so. But so far, what we can tell, we are very happy with the operations of the new crusher.Mines, in general, we are having a very favorable situation with SEK 2 billion in profit or a little bit more than SEK 2 billion, favorable prices and terms just as we have for the whole group. In Aitik, we have lower grades quarter-on-quarter, but this was well communicated to everybody that we were in extremely high grades for the last few quarters. We're heading down. We are now still mining over reserve rates, even though it's not as high as it was in Q1. And the same thing is true for Tara where we also come down from the very high levels that we had in Q1. And as I said, the new crusher is in operation in Aitik.In Garpenberg, we have lower zinc grades, but I think it was also well communicated. But the production, in general, is very well. In Kevitsa, we have the other way around. We have very high grades, and we have a stable production. I think we have a production record in terms of nickel coming out of Kevitsa.So if you look in total in the production, yes, the amount of metal is coming down in copper from the very high levels that we had with the high grades, but the throughput is quite on decent levels. And the zinc mines, as we're coming down and as the Maurliden mine is being depleted, we will have more difficulty keeping the throughput up. And the grades are also down with the communicated lower grades in Garpenberg. If you look at the nickel side, we've had a very good quarter in nickel, in general. And with the high grades, we have a record production of nickel.Moving over to the smelters. As I said in the start, we are quite happy with the quarter for the smelters totally. We've had here a stable metal and price -- metal price and terms situation, I should say, where the metal prices are strong just as for mines. However, the lower TCs makes the total picture more balanced.We've had very stable production. As I said, the maintenance stops has come in as communicated. There's been no extra problems that we found during that.We've also made the decision yesterday in the board meeting for a new leaching plant in the Rönnskär smelter. It's a SEK 750 million investment for a plant that will take care of old materials and byproducts that comes out of the existing production. It is an investment that stands on its own merits and makes lots -- makes money, as of itself. It's also taking care of an environmental problem. So had we not been able to do this investment, we might have had a negative impact instead, as it always depends on where you put the 0 line on this one. But we're quite happy with this investment, and it will be coming up online in about 24 months or 27 months from now.Smelter production, as I said, stable generally. We've had good production everywhere. And maybe the zinc side is what's been the best side. As you know, for the last few quarters, we've had problems and some stability issues in our zinc smelters. That has, for the time being, been overcome, and we're doing better production-wise there. And the other smelter is on par to get up to the speed of the 200,000 tonne pace. Also, the nickel production has been quite good in Harjavalta.Financials. And here, I would like to leave the floor to you, Håkan.

[Håkan Gabrielsson, Chief Financial Officer]

Thank you, Mikael. Thank you. So good morning. As Mikael said, this has been a quarter with good prices and terms and strong results.So if we start by looking at some of the numbers, we have an EBIT, excluding process inventory, of SEK 2.3 billion. That is slightly down compared to Q2 of last year but -- slightly up compared to Q2 of last year but -- but lower than Q1.CapEx is SEK 1.6 billion. This is fully in line with our guiding for the full year of just over SEK 6 billion.Free cash flow is SEK 1.7 billion, and that leaves us with a net debt-to-equity ratio of 13%. And in that number, you should also remind -- remember that we have paid dividends and redemption of shares amounting to roughly SEK 3.8 billion. So strong quarter and a strong balance sheet.Looking at the financials by segment. You can see in mines that we've strengthened the result, up to SEK 2 billion; smelters, stable in spite of maintenance stops; and then finally, other and eliminations, which is negative, and that includes an internal profit elimination of about SEK 300 million. I'm not going to spend too much time on that because it's simply a matter of timing. And when the profit in mines gets higher, so does the impact of timing. But I know that there are quite a few of you who does modeling by segment, so just a few words on this already now.In the second quarter, we've had very good deliveries from the mining side. So mines have been able to reduce the concentrate stocks with about 25,000 tonnes, and that shows in the mines' numbers. That stock is now showing up in smelters. So basically, what we've been doing is moving 25,000 tonnes one step in the value chain. Of course, that doesn't have an impact on the group result, but you will see a profit in mines and then a negative impact on the elimination. So good deliveries in mines, but purely a timing effect in the profits.With that said, if we then go into the bridge, the EBIT bridge comparing Q2 with the same quarter last year, as you can see, there's a slight improvement of roughly SEK 100 million. And we're helped by prices and terms that added SEK 700 million to the result, primarily metal prices being better, offset a bit by negative foreign exchange rates and treatment charges.Volumes side. We've had lower milled production, slightly lower milled production, and lower grades in the mining area, for example, in Aitik. Furthermore, also in Garpenberg, I think you could add -- comparing to last year.We've had higher production in the zinc smelters. As you might recall, last year, we've had some process issues in Kokkola, and that is now gone. And the zinc smelters have been operating in a good pace.Costs side. Compared to last year, as Mikael indicated, there is an increase in inflation, and we see it primarily in energy and consumables. There is, of course, an annual increase of salaries as well, but that is, by relative terms, a smaller amount. Roughly, the inflation that we see in energy and consumables here is about SEK 140 million out of the SEK 220 million total cost increase. So it's a significant amount. And then depreciation is related to the metal production. And all in all, a positive change in SEK 132 million.If we instead compare with the previous quarter, Q2 to Q1 of '18, there is a SEK 400 million lower result. The main factor in there is lower grades in mines. We've had very high grades in Aitik and Tara in Q1, and as we talked about in the last quarterly call, they would come down to this quarter. And they have done that, and that has an impact in the bridge of about SEK 500 million, so it's a significant amount.The throughput in mines is higher. We also have higher free metals in smelters that have compensated for the maintenance. So operationally, it looks good. Prices and terms, slightly better primarily due to a stronger dollar. And then on the costs side, we have about SEK 80 million cost for the maintenance stops in Q2 that wasn't there in Q1. Furthermore, there is some seasonality, there is some inflations between the quarters, but I'd say that the individual amount from the maintenance stop is the biggest one in the cost side.Cash flow. We are slightly up compared to Q1 or slightly down compared to Q2 of last year. There weren't so -- that much impact on working capital this quarter. We have slightly higher CapEx, and we have higher taxes paid, basically because of higher earnings, but a good cash flow of SEK 1.7 billion. And that gives us a balance sheet that is very strong, gearing, as I said, 13%, even with significant payments to shareholders. We've extended the loan duration to 3.8 years, as you may have seen in an earlier press release and in the report. We have done a refinancing in the quarter. We have also amortized some of the loans with a shorter duration. So we have extended the loan duration to 3.8 years, and still a good interest rates of 1.2%. So strong balance sheet.Mikael, with that, over to you again.

[Mikael Staffas, President & CEO]

Thank you, Håkan. One thing that's in the numbers, and you should all be aware of, is that we've had a new ruling in the environmental court in Sweden regarding Aitik where some of you might have read about it. There has short-term defect that we need to put into a collateral, SEK 1.1 billion extra related to the decommissioning costs. This discount, it has led us to increase the provision for the decommissioning with about SEK 800 million, and this then, from an accounting point of view, becomes an asset of equal size that would be amortized over life of mine, which means that the depreciation going forward will be bigger. And so that, we have done. We have also appealed this ruling, so we'll see where it ends up, but we have taken a cautionary approach and make sure that we put the more conservative number into our accounting.Otherwise, going forward, first, the general thing that needs to be said, that even though the grades are down compared to Q1, Q2 is still, on average, above reserve grades in terms of grades, and we should be aware of that when we're looking into the future longer term.Regarding Aitik, we are guiding for the remainder of '18 and '19 at 0.25%, so continue for the next 6 quarters over reserve grades. And also, for 2020 to get to the 45 million tonnes, that would be possible with the new crusher in place.In Garpenberg, we have guided before for the 4.0% grade in zinc for the rest of this year. Now we're also adding the guidance that we will continue on that level also for the next 4 quarters after that on average. So the '19 average is also 4.0%. We're having a higher silver grade for the rest of the year at about 115. The silver grade for next year is the reserve grade, which is roughly 100. And 2020 is the guidance for the 3.0 million throughput volume, and that project is also going according to plan so far.And for Kevitsa, we have guided for the 9.5 million pace coming up in 2020, and that project, even though it's in early days, is also going according to plan.We did have the negative impact from the profit elimination in Q2. Over time, this is a timing effect that should be 0. However, it was very positive in Q1. So you should be very careful what you say for Q3, but it shouldn't be negative, anyway.Planned maintenance. We still have planned maintenance coming up for Q3 with SEK 70 million. That guidance, I think, is in line with previous guidance we have given.And the CapEx guidance for the year is still the same as before, slightly above SEK 6 billion.So the conclusion, and we'd like to make this point, we still feel that what we've said many times is still true. We are well positioned in this market. We have mines, and we have smelters. They are working together, and it's working as a good corporation. We have base metals and precious metals that also provide a good and healthy, stable operational environment. High productivity, stable operations, high corporate responsibility, we have -- are also working in stable jurisdictions, and we have a long life of mines compared to many of our competitors.We have a strong balance sheet, and we have lots of growth opportunities that are not yet in the plans, but we talked about before, including Tara Deep, which is also going according to plan, even though it's still a couple of years out before we will be able to make any decision on that. The Kylylahti prolongation and the cobalt situation is also moving relatively well. We'll come back to that in later quarters when we have the reserve upgrade coming in the winter. And the smelters are well positioned for the circular economy, in general, and the new leaching investment in Aitik is in line with that.I would also like to just give you, very quickly, a head-up. For those who haven't seen it yet, we have a Capital Markets Day planned in Stockholm and in Aitik for March 13 and 14 of next year. We're very happy to see as many of you there as possible.And with this, have I said anything I shouldn't say that I shouldn't have said, then I haven't said it. And with that, I would like to go over to the operator and open the stage for questions.

[Operator]

[Operator Instructions] And our first question comes from the line of Alain Gabriel of Morgan Stanley.

[Alain Gabriel, Equity Analyst]

Three short questions from my side. First, on the eliminations line, you mentioned it's probably going to even out for the full year. Do you mind giving us a split between Q3 and Q4? Or should it be evenly split? Second question is on the cost inflation expectations for the second half. I guess, many of your competitors are increasingly talking about cost inflation. What are you seeing in the business? And what can be expected for the second half? And the third question is on the investment that you have, the leaching plant at Rönnskär. Is that more of a defensive investment just to comply with environmental standards? Or is it more -- does it meet the internal hurdles of IRR of 15% that you have alluded to in the past?

[Mikael Staffas, President & CEO]

Let me start from the bottom in saying that the leaching plant in Rönnskär is meeting the internal targets, so it's a financial viable -- financially viable investment and is also clearing out some environmental issues at the same time. So it's an investment that solves 2 things at 1, and we are very happy that we can put it up that way. Regarding cost inflation, you can work the numbers out yourself, but the inflation that we're seeing right now compared to last year is around 4%. It's very much driven by the energy side and by the consumables or chemicals side and not so much by other supplies that we're getting. It's very difficult to give a forward guiding for that. I think the only thing I can say is that we -- the level that we have right now is probably the level that we'll have to stick with, and any further increases is up to the markets to decide for these kind of commodities. Regarding elimination, Håkan, maybe you take that. This is an accounting issue.

[Håkan Gabrielsson, Chief Financial Officer]

I can do it, yes, sure. As we say, it's a matter of timing. Last quarter was a fairly significant positive number. This one is a negative one. And so if you look at the full year number so far, then it should come back over time. Of course, there's a price dependency as well in there, but it's difficult to give some guidance quarter by quarter. But I would calculate with positive amounts going forward.

[Operator]

Our next question comes from the line of Liam Fitzpatrick of Deutsche Bank.

[Liam Fitzpatrick, Research Analyst]

Two questions for me. First one, probably for Håkan, just on the financials for the mines. You did answer part of this by giving us the inventory reduction. But I just wondered if you could give us an idea of what mines' EBIT would have been if you didn't have that inventory reduction through Q2. And then secondly, just on strategy, you mentioned in the presentation about growth opportunities, they're all organic. Is M&A still part of the strategy? Are you still looking at opportunities similar to Kevitsa?

[Håkan Gabrielsson, Chief Financial Officer]

Should I start with the...

[Mikael Staffas, President & CEO]

You can start with the accounting.

[Håkan Gabrielsson, Chief Financial Officer]

I don't think you need to think so much about the second one either, but anyway, roughly SEK 250 million to SEK 300 million lower without inventory movements.

[Mikael Staffas, President & CEO]

And then I can come in to talk about the strategic growth options and M&A. I mean, the answer is we are interested and we're looking and we're participating in several situations. We are -- as we've always been quite conservative, we will only make deals that we think where it makes a lot of sense. And if we find something, we will act upon it. But I don't know if I can answer more than that. The primary focus on -- in our strategy is, for sure, to maximize what we got and do the best out of what we got.

[Operator]

Our next question comes from the line of Christian Kopfer of Nordea.

[Christian Kopfer]

Firstly, just a follow-up on the new crushers in Aitik. Are they running according to your plans here in -- so far in Q3?

[Mikael Staffas, President & CEO]

Yes.

[Christian Kopfer]

And what does that mean in terms of -- if you can say anything about the capacity and how much they can produce.

[Mikael Staffas, President & CEO]

Now I will put it this way. In a normal mine, a crusher should never be bottlenecked. Man, I think it's been a very particular place where the crusher has been bottlenecked. It should never be. With these new crushers that we've put in, we have designed them, so the crusher should not be the bottleneck. And as I said in the presentation, so far, everything looks good. It doesn't look like the crushers will ever be bottlenecked going forward. Then there will be other bottlenecks. We will have bottlenecks before the crushers in terms of loading and trucking, and we'll have bottlenecks after the crusher in terms of milling where they should be. And these are operations in Aitik that has never really been put to test because it was always the crusher that helped them when they had low availability. They could blame somebody else. That's going to be a new game. Exactly how fast this will be sorted out and exactly how fast we will be able to come up in terms of quarters is not -- impossible to really say because we're testing new grounds, but we have guided 40 million, 45 million tonnes for 2020.

[Christian Kopfer]

Right. But if I look second quarter 2017, you produced more than 10 million tonnes, and that was with the old crushers and with the unavailability and so on. So we should at least see an increase from that level.

[Mikael Staffas, President & CEO]

Yes, you can say that. In Q2 -- in '17, we had a time when for a quarter, the crushers did not cause a problem. And then that was what the mine could do, 10 million and a little bit. That's, of course, a good quarter normally in terms of weather and so on. And that was a good quarter in terms of weather. But that's where you would have been without any other thing. But we have to then push the availability for the systems around to get after the 45 million, which requires an 11.5 million per quarter.

[Christian Kopfer]

Right. And then for -- on the cost inflation side, again, the chemicals inflation and so on, is that mainly on the smelters?

[Mikael Staffas, President & CEO]

Yes.

[Christian Kopfer]

Right. So -- and if I look at the cost inflation for the mine side, you said that the second quarter increased cost was primarily due to milled volumes and something else. If I look at milled volumes, they are definitely up. They are up 8% in the second quarter. But the cost is up 22% in the second quarter versus the first quarter. So I mean, were there a lot of onetime costs due to the new crushers? Or what happened there?

[Mikael Staffas, President & CEO]

I can say that there were some onetime costs, which were, I think, more dependent on that. We had other problems before the new crusher came in, not directly linked to the crusher. But then you should also be aware, Christian, that we do have a seasonality in terms of costs. We always have higher cost in Q2. One of these drivers is that we take in lots of summer extras that we train, and we have that cost always in Q2 every year to be able to run our mines through the summer. So that's one thing that comes in there. I think I see numbers off the top of my head that we typically have 6% higher cost or so in the Q -- in Q2 compared to Q1 just from seasonality.

[Christian Kopfer]

Right. But if I look at cost per tonne base, in Q2, first half of the Q1, it's typically coming down, actually. So in Q2 of 2017, it came down from Q1 because you had a lot of winter costs or lower volumes, perhaps, in Q1. So I should -- I guess, I should definitely see volumes per tonne coming down underlying in the next couple of quarters.

[Mikael Staffas, President & CEO]

Yes. And now you're taking it per tonnes, and of course, the Boliden area, that's not the biggest thing. But the fact that we're depleting the Maurliden mine is playing in somewhere in this where we had it relatively cheap open-pit tonnes that will be replaced by expensive underground tonnes from the other mines in the Boliden area. So there is a little bit of a mix change that is forever, although that might be a smaller number.

[Christian Kopfer]

Right, but the new countries in Aitik should be quite positive on the unit cost, I guess, in Aitik.

[Mikael Staffas, President & CEO]

Yes.

[Christian Kopfer]

When there, yes.

[Mikael Staffas, President & CEO]

Yes.

[Christian Kopfer]

And then finally for me then, on administration costs, they are up to the highest levels I've ever seen ever in Boliden here. I think it was almost SEK 200 million in the quarter. What happened with that cost item?

[Håkan Gabrielsson, Chief Financial Officer]

Yes. I think you should look at the total cost. I mean, there will be individual items and corrections and movements between those lines in the quarters. So I mean, we focus the combined costs. We're working with that. We have the inflation that we mentioned and so on. And then -- so I wouldn't spend too much time looking at the individual cost lines. There's no dramatic change happening there.

[Mikael Staffas, President & CEO]

And you know that administration for us, Christian, that's exploration. And we haven't made a big thing out of that. But exploration activities, for different reason, was quite intensive in Q2. They were also relatively lower in Q1, and we expense all our exploration.

[Christian Kopfer]

Yes, that's true enough. Okay, fine. Okay. Right, right, right. Maybe -- I mean, on the electricity side, you mentioned energy cost. But is that electricity? Or is it oil or isn't?

[Håkan Gabrielsson, Chief Financial Officer]

It's both.

[Mikael Staffas, President & CEO]

It's both. On the electricity side, we are much more hedged with long-term contracts, although we do have a part that is on spot that comes through. On the other, on the oil cost and coking coal and all the other fuel costs that we have, they were all open. So there, we get the market price much more directly into our P&L.

[Operator]

Our next question comes from the line of Luke Nelson of JPMorgan.

[Luke Nelson, Research Analyst]

Three questions for me. Firstly, CapEx, you're tracking below the $6 billion (sic) [ SEK 6 billion ] target. Obviously, H1 is seasonally impacted. But as we now stand sort of halfway through summer, how confident are you of hitting the target? And more generally, given a few years of undershooting guidance, are there any risks this starts to impact mine planning? Secondly, again, on guidance, you've obviously added another year of zinc grades for 2019. My question is when can we expect more quantifiable guidance around medium-term grades in CapEx, especially with the expansions that are underway across a number of the mine assets? Or do we have to wait for the Capital Markets Day next spring? And then, finally, given the zinc treatment charge settlement in the quarter, what was the net impact of [ remark ] in Q1 treatment charges in the period?

[Mikael Staffas, President & CEO]

I'll leave the last one for you, Håkan, but I can take the first 2 ones. Regarding CapEx, it's right that we are a little below the margin rate, and we need to get that up in the second half. We are maybe more confident this year than other years that we will actually reach it. We are not yet in the kind of problems that you said that we're underspending and thus, having to change the mining plans. We're not at that situation yet, but of course, this is one thing that we monitor very closely. Then your second was regarding guidance and regarding guidance on average grades. You will have to wait until we do the upgrade -- or update on the reserves and resources, which is in February in connection with the Q4. And then we will, depending on where they end up, which we don't know at this time I'm speaking right now, that might be something that we will dwell more deeply into on the Capital Market Day. Then I will leave the last one for you, Håkan.

[Håkan Gabrielsson, Chief Financial Officer]

CapEx guidance, I think, you should expect more in Q3. Regarding TC/RC, we had a negative impact in the -- you can see it also on the EBIT bridge in the report of [ SEK 86 billion ] in smelters. A part of that is internal money, so SEK 47 million in the group between Q1 and Q2.

[Operator]

Our next question comes from the line of Alain Gabriel of Morgan Stanley.

[Alain Gabriel, Equity Analyst]

Just one question on the CapEx guidance. Mikael, you typically like to give a CapEx 1 year out at the time. In light of the investments that you have in the leach plant, how do you think the CapEx in 2019, directionally at least, would develop versus 2018? Should it still come down? Or would it rather remain flat year-on-year?

[Mikael Staffas, President & CEO]

That's, of course, a good question, and I will be -- give you a very blurry answer because we will sum this up in our own processes in the early fall, and that's when we get a better number. We are in capital-intense periods, as you can see just by adding up what we have announced that we're doing. But the exact direction, I will come back once I have a better number.

[Operator]

[Operator Instructions] And there are no further questions at this time. Please go ahead, speakers.

[Mikael Staffas, President & CEO]

Okay, well if there are no further questions, I wish you all a very nice summer. Thank you for attending, and I look forward to talking to you again after Q3. Bye.

[Håkan Gabrielsson, Chief Financial Officer]

Thank you. Bye.

[Operator]

This now concludes our call.