Linde's (LNAGF) Management on Q1 2016 Results - Earnings Call Transcript

| About: Linde AG (LNAGF)

Linde AG (OTCPK:LNAGF) Q1 2016 Results Earnings Conference Call April 29, 2016 8:00 AM ET

Executives

Dominik Heger - Investor Relations

Georg Denoke - Chief Financial Officer

Analysts

Martin Roediger - Kepler Cheuvreux

Peter Clark - Societe Generale

Markus Mayer - Baader Helvea

Andreas Heine - MainFirst

Neil Tyler - Redburn

Peter Mackey - Exane BNP Paribas

Thomas Wrigglesworth - Citi

John Klein - Berenberg

Operator

Ladies and gentlemen, welcome to the Q1 2016 Results Conference Call of the Linde Group. At our customer's request, this conference will be recorded and published afterwards. As a reminder all participants will be in a listen-only mode. After the presentation there will an opportunity to ask questions. [Operator Instructions]

This presentation contains forward-looking statements about Linde AG and their respective subsidiaries and businesses. These include, without limitation, those concerning the strategy of an integrated group, future growth potential of markets and products, profitability in specific areas, the future product portfolio, development of, and competition in economies and markets of the Group. These forward-looking statements involve known and unknown risks, uncertainties, and other factors, many of which are outside of Linde's control, are difficult to predict and may cause actual results to differ significantly from any future results expressed or implied in the forward-looking statements on this presentation.

While Linde believes that the assumption made and the expectation reflected on this presentation are reasonable, no assurance can be given that such assumptions or expectations will prove to have been correct, and no guarantee of whatsoever nature is assumed in this respect. The uncertainties include, inter alia, the risk of change in general economic conditions and government and regulatory actions. These known, unknown, and uncertain factors are not exhaustive, and other factors, whether known, unknown, or unpredictable, could cause the Group's actual results or ratings to differ materially from those assumed hereinafter. Linde undertakes no obligation to update or revise the forward-looking statements on this presentation, whether as a result of new information, future events, or otherwise.

May I now hand you over to Mr. Heger, who will lead you through this conference? Please go ahead, sir.

Dominik Heger

Good afternoon ladies and gentlemen. This is Dominik Heger from Investor Relations. Thank you for joining the presentation of the results for the first quarter of 2016. We are aware that a number of companies have also reported today and we'll therefore try to keep the presentation brief.

Today's call will be hosted by Georg Denoke, Member of the Executive Board and CFO. Let me now hand you over to Georg.

Georg Denoke

Yes, thank you Dominik and good afternoon ladies and gentlemen also from my side. Let me begin with the highlights of our performance in the first quarter of 2016 which is slide number three.

Reported revenue declined by 3.1% to €4.3 billion due to currency headwinds and the expected lower contributions from engineering. On the other hand the revenue impact from the first price reduction from competitive bidding round three was more than compensated by the acquisition of American HomePatient. On a currency adjusted basis, the decline on group level in revenue was 0.3%. Reported operating profit declined by 1.9% to €991 million, but adjusted for currency, operating profit improved by 0.6%.

The revenue and operating profit figures here at the group margin of 23.3%. We recorded strong operating cash flow of €883 million in the first quarter representing an improvement of 19.3% over last year's levels. Reported EPS came in at €1.65 slightly above the level of last year.

I would like to the development of revenue and operating profit by division on the next slide no 4. In the gases division negative exchange rate effects and lower natural gas prices restrained revenue development. This was counterbalanced by the American HomePatient acquisition as well as the underlying growth. The result was a decline in reported revenue of 1.4%.

Revenue in engineering division proceeded in line with expectation declining 15% the prior year. Operating profit in the gasses division remained stable at slightly above €1 billion despite the negative currency headwind. In the engineering division margins came in at 8.1% and in line with our medium term guidance.

I will now move on to a more detailed review of the performance in the gasses division on slide number five. Headwinds from natural gas prices continued in the first quarter and amounted to a minus 1%. Currency was also a headwind coming in at minus 3.2% against the year ago quarter. The exclusion of these two factors resulted in a comparably growth figure for the first quarter of 2.9%. As a reminder, the figure for competitive growth is not adjusted for electrical energy.

I would now like to proceed to comparable growth by product area on the next slide. Please move on to slide number six. The 8.9% growth in healthcare was driven by the American HomePatient acquisition that has been consolidated starting on February 1. We also experienced continued underlying volume growth at Lincare. Excluding the acquisition, healthcare overall grew around 3.3%.

Growth in onsite came in at minus 0.3% as was prior year. The development was affected by the end of contract in Australia and the inventory [ph] of the customer in the UK which you already know from last year's communication. Onsite growth adjusted for these effects would have been plus 1.7%. Bike revenues increased by 1.1% on a comparable basis with Asia providing the highest growth contribution.

In cylinder, comparable growth in the first quarter amounted to 2.1% where was the prior year quarter. The development was supported by our specialty gases business in North America.

I'll move on now to the revenue splits by operating segment on slide seven. Revenue in EMEA declined by 0.2% on a comparable basis. The previously mentioned insolvency of a customer in the UK and the challenging macro environment in Africa wait on growth. Strong growth contributions came from the region Middle East and Eastern Europe along with the product area healthcare. Additionally, the startup of two air separation units for our onsite customer Cybore [ph] also made a positive contribution.

In Asia-Pacific growth was 3.5% on a competitive basis. Asia led the way with 6.9% compared with April. Meanwhile, the economic environment in the South Pacific remains weak. In terms of product areas, growth was driven by bulk as well as on-site.

In India we brought two air separation units on stream that will supply our customer [indiscernible]. Comparable to the growth in the Americas was 5.6% in the reporting period. As already mentioned this result was supported by the American HomePatient acquisition as well as strong development in North America, specialty gasses. Pricing initiatives in South America also contributed to growth.

Proceeding now to operating profits by operating segments on slide number eight. In EMEA operating profit declined by 2.5% to €430 million. Operating margin expanded to 30.5% helped by cost savings from restructuring and lower natural gas prices. At €254 million operating profit in Asia-Pac remained broadly stable comparable to year ago quarter despite softness in the South Pacific and currency headwinds.

As for the Americas the operating margin of 25.1% states betting against the level from last year. Lower natural gas prices and the North American specialty gasses business had a positive influence on the margin. On the other hand the first level of price reduction from competitive bidding three that went into effect on the January 01, had a negative effect.

Let's now take a look at the engineering division's performance on slide number nine. Engineering revenues developed in line with project progress totaling €568 million. The realized margin of 8.1% is in line with our outlook of around 8% for 2016. €310 million order intake in the quarter remains adversely affected by the postponement of investment decisions by customers, in particular, in the petrochemical industry. At €4.2 million order backlog remains on a very solid level. This concludes the divisional performance review.

I will now move on with the financial performance on the next slide. As already mentioned, the cash flow from operating activities continued its positive trend in the first quarter rising by 19.3% to €883 million. This improvement resulted primarily from a higher figure for advance payments from 10 construction customers. The cash flow development facilitated a decline in our net debt to operating ratio from 1.9 times at the end of last year to 1.7 times at the end of this first quarter. Note that our proposed full year dividend payment will occur in quarter two.

In April, we successfully raised €750 million from the issuance of a bond with 30 years maturity. The coupon rate of 1% represents the lowest fixed coupon ever achieved with this duration long duration by Linde for public transaction.

I would like to conclude with the outlook on the next slide. We hereby confirm our outlook for 2016. For revenue depending on economic development we expect group revenue to be in the range of minus 3% to plus 4% whereas the currency adjusted figure of 2015. In the gasses division revenue is expected to be between 0 and 5% higher than the currency adjusted level of 2015.

For the engineering division we expect revenue to be between €2 billion and €2.4 billion. Our expectations for group operating profit is that it will be in the range of minus 3% to plus 4%, where as the currency adjusted figure of 2015.

Operating profit in the gasses division is expected to be in the range of minus 1% to plus 6%, again the currency adjusted figure of 2015. The upper right margin for engineering division is expected to be around 8% in line with our medium term guidance. We continue to anticipate the group rose of around 9% in 2016. We also reconfirmed our medium term targets of group operating profit of €4.2 billion to €4.5 billion and return on capital employed of 9% to 10% for the year 2017.

This concludes today's presentation. Thank you for your attention and interest in Linde and we are happy now to take your questions. Piya [ph] you may now poll for questions. Thank you.

Question-and-Answer Session

Operator

Thank you. [Operator Instructions] The first question comes from Martin Roediger - Kepler Cheuvreux. Your line is now open. Please go ahead.

Martin Roediger

Thank you and good afternoon. Three questions if I may. First is on the operating cash flow, the engineering team rules Gazprom with advanced payments impacted working capital industrial cash flow can you quantify this segment?

The second question is on American HomePatient which contributed to €47 million in sales. When I make the math then it looks that this business is growing by high single digit percentage rate and I am puzzled how strong the sales contribution was in Q1 given the fact that the consolidated just two months of it in Q1 and it should have been impacted by competitive bidding three as well? So can you please talk about the organic sales performance of American HomePatient?

And the third question is also related to American HomePatient and here about the profitability. You said in the quarterly report that the profit contribution for February and March was just €1 million while that business in January was not consolidated, it was minus 3 million so a loss making. Why is profitability of American HomePatient so low?

Dominik Heger

Yes, Martin, thank you for your detailed questions. As you know we were not in a position to disclose the Gazprom order by size in size in the last quarter of 2015. Therefore it is also now very difficult for us to communicate the prepayment which we received related to that order but is a sizable one, maybe that's what you can read out of that.

Georg Denoke

On American HomePatient I think when we look into the development overall as I pointed out from a healthcare perspective without American HomePatient the comparable number is 3.3% and the comparable number also for North America Homecare is positive including the price cut. It's is a very pronounced volume development which is continuing from a more last year's perspective as we experienced and you know from our last year's comparison.

Therefore it then has a negative price effect and as you know, this is the first effect starting from January 01, and there is the second one then from mid of the year what we expect. From the profitability from the American HomePatient which you found in the notes, you have to understand that this is a number which is a net income number. Thank you for your questions.

Martin Roediger

Okay, thanks.

Operator

Thank you. And the next question comes from Peter Clark from Societe Generale. Your line is open, please go ahead.

Peter Clark

Yes, thanks for taking, the two questions, or actually three very quickly. Obviously the margin in North America, I thought it was pretty encouraging. I heard what you were saying on the mix, but obviously American HomePatient coming in dilute [indiscernible]. Just one ring and whether that sort of margin you would hope to maintain for the rest of the year, would that be too optimistic around the 25% mark and within that Lincare I believe you will be a pretty comfort and you can try and keep Lincare above the 20% mark on EBITDA.

And then the second question just to clear about the Tata UK exposure, I've seen the ASUs bought over and scandal have BOC plastered all over them but I just want that Tata exposure is accepting the sunny [indiscernible] looks like it has been safe for now.

And then the last question, hearing what you're saying on the cash flow and the prepayments and almost you had a one off last as well, but obviously these operating cash flow to sales near a 20% what is your feeling for the full year, the 20% obviously was last year, had a one off I think in Singapore, but effectively if the number seems to have gone up from the underlying 18% or something you are targeting to get above what you had historically on the operation cash flow. Thank you.

Georg Denoke

So North America, I think we don’t want to give exclusive guidance for North America, but as we pointed out and as you already have that in your summary, there is an effect additionally coming through with the Lincare price cuts in the second half which is related to CB3 and then also the CB2 rebidding effect if you include it. Therefore that's something which is definitely a negative one. And as you know from our bridge at the year-end communication we have defined here the relatively size of the impact.

What you have seen here in the first quarter is a stronger contribution from the specialty gases business I think that is something we have to point out. That is not new. The sequence of the quarters also Q4, Q3 last year the effect started to development more positive. So that's something which is as you know also from the product itself it is a little bit more volatile from the effect of how long will this hold. We do not expect that from a perspective of a full year impact. That is probably not our assumption here.

The other additional point is of course fifth stop was coming down which had some positive effect especially for North America. And I think it is not a big effect, nevertheless we had a positive development in South America especially in the difficult market Brazil we had positive contributions from our restructuring which is helping a little bit. So from this perspective that is lot of description of the North American development.

The cash flow effect I think I only want to be a little bit shy. I think you are right. We of course strive for improvement, that's no question, but we have to have in mind that the restructuring the cash flow or cash outflows are coming through also within this year because many of that is related to Europe and was finalized as you know in the second half of 2015. Therefore the cash outflow will come through also within this year.

On Tata, as you pointed out of course the steel demand especially in the UK market is from a very take out of our onsite schemes on the lower level rather lower level, so we had a soft development which is also included in the onsite development on the contact basis which we have not pointed out separately because we see this as a normal impact of the business in relatively weaker times, that's something you have to have in mind. Overall you are right, I think with the transaction on the [indiscernible] site that is probably a more positive outlook for that location and we have to watch carefully how this goes into an overall development from a European perspective, but also global perspective from here. That's stage I think it has let's say softening effect from a demand perspective, but let's say positive indication from Tata in UK.

Peter Clark

Okay, thank you Georg.

Operator

Thank you. The next question comes from Markus Mayer - Baader Helvea. Your line is now open. Please go ahead.

Markus Mayer

Yes, good afternoon gentlemen, few questions I'll ask firstly again on competitive bidding part three you said in Q4 conference call that they expect roughly the effect to be roughly around €600 million for sales and roughly €200 million EBITDA. As this is 50-50 effect, so basically how is it coming, so do you expect half of that to come in the first half and then that was more backend loaded, there has been 50% of this competitive biddings starts, then the beginning of the third quarter? So maybe you can help us [indiscernible]?

And secondly, you had quite a high [indiscernible] in Asia and may be you can help us this is kind of end customer industry this is coming from where, is this market share gain or just startups?

And then lastly, friendly French competitor said that Australia is spotting out, do you see this as well?

Georg Denoke

Yes, thank you Markus for your questions. I think starting with Lincare I think it is a repetition of what I already said. The impact is coming in first of January, second impact comes in mid of the year as you know with an effect from CB3 and the CB2 rebidding effect and then we do see in the first half year of 2017 because of the ready or ramp in of the price cost until mid of this year we see also for 2017 in the first half an additional effect against the comparison of the first half of 2016. This is nothing new. This is I think what I can explain again and as you were pointing out the assumptions overall when you see the bridge it was around 0.2 number which we happen to switch I think this gives better, I think we can give at that point in time really.

Markus Mayer

So as an add-on question and so from the phasing noting has changed basically to what you expected before?

Georg Denoke

No, I think we have made our assumptions as you know this was within the range of our assumptions in the dimensions.

Markus Mayer

Okay.

Georg Denoke

Then from a buy perspective you right that we have seen especially in Asia East which is also here including Korea, we have seen stronger Korean growth, we have see Asian growth in China especially because all volumes plank loading for a different number of industries. I think there is not one industry spending out here and then we have seen better development against the previous year in South and East Asia and [indiscernible] I think here this is also relatively pronounced volume.

You can say on the backside those markets they still have slightly negative pricing, but better than last year. And on our SP, on our South Pacific region it is I think flattening out from the perspective of are we in that development it is still weak but stabilizing weak so let's say it that way.

Markus Mayer

Okay.

Operator

Thank you. The next question comes from Jeff [indiscernible] Morgan Stanley. Your line is now open. Please go ahead.

Unidentified Analyst

Hi good afternoon. Three on my side as well. The first on the cash flow, cash tax paid seemed to be rather low this quarter is there an explanation and can we expect that for the remainder of the year?

The second one on soft conditions in Africa. What do you expect for the rest of the year in South Africa or are we also bottoming out?

And the third one speaking about other markets, are there any markets that are not really improving at the moment that you see always ongoing momentum? Thank you.

Georg Denoke

Yes, thank you for your questions. I think yes we have seen certain markets which are more positive than others ad one definitely was Eastern Europe and the Middle East from a development and contribution of new plans coming on stream but also underlying development relatively better. I think this is something which we definitely have to mention. When we look into continental Europe, UK, I think that was relatively soft start into the year overall.

Africa is very difficult to forecast as you know from a sub Sahara country set up there are positive effects still, but these are smaller in comparison to the Republic of South Africa which is still in a challenging environment. But overall I think we also have to see that here when we look in comparison the restructuring effort is coming through from an overall perspective which is positive as you have seen that in South America too.

So North America is I pointed out was especially strong on the specialty gas development. Many of these gasses go into the electronics industry. Therefore that was a positive development here from this perspective at that moment in time. And Asia I think I described already. So from a perspective of the cash tax I think it is slightly lower comparable to the last year when we look into cash tax. The rest of the description as you have pointed out is likely correct.

Unidentified Analyst

So we can expect that going forwards for the next three quarters or that's going to normalize very quickly?

Georg Denoke

No, that will normalize. I think that is as you know this is not the plan number and that is really a number which comes in when you finalize certain audits from different states. Therefore that is difficult to plan. I would go with what we pointed out when we guided you for the year.

Unidentified Analyst

Okay, thank you.

Operator

Thank you. And our next question comes from Andreas Heine – MainFirst. Your line is open. Please go ahead.

Andreas Heine

Yes, three questions if I may, the first is on the cylinder business. The 2% increase better than in recent quarters, is that also explained by the specialty gasses and as you said more broader based? And in healthcare if you strip out the CB3 impact, how does the growth sort of the underlying demand and does it compare to your trend, to trends you see in Europe?

And sorry again for the CB3 impact, is it let's say that you have an impact staring on the first of January and then it is in the first and second quarter equal and as of the third quarter you have this step up and the impact starting on the July 1, or is it then the impact in the same quarter higher than in the first quarter and in the fourth quarter are stronger than the third quarter? These are my questions.

Georg Denoke

Yes, thank you Andreas for your questions. I think I'll start with your last question and [indiscernible] this is lower up the chain in Q2 and then if there is in Q3 and Q4 the additional effect of the price cuts coming soon.

Andreas Heine

Thanks for the clarification.

Georg Denoke

That is the point. Then on the cylinder business the development is related to the specialty gasses development. I think that is the main driver here which we have to point out. It is not only North America. There are some other geographies which have been similar effect but on a smaller basis.

And when we look into healthcare, I think overall healthcare Europe is but deep ever rich without the American HomePatient. So when you see the 3.3% comparable without the acquisition in the U.S. Europe is stronger in healthcare and the 3.3%, more that is quite strong.

Andreas Heine

Thanks.

Operator

Thank you. The next question comes from Jeremy [indiscernible] and your line is now open. Please go ahead.

Unidentified Analyst

Hi thanks for taking a couple of questions, Jeremy [indiscernible]. Firstly, just following the comments you just made about healthcare being strong in Europe. Is it fair then to assume that cylinder volumes are actually down quite a bit in your quarter or the quarter year-over-year?

And then secondly, can you just touch again the key regions for the margin improvement in Asia Pacific please. Thank you.

Georg Denoke

Thank you for your questions Jeremy. I think cylinder Europe is not negative. I think PGP is positive slightly in volume and then in additional contribution also in price, but softer than the average 2.1% that is clear. And then the mass development in Asia is driven by the addition [indiscernible] I think and persistent which we seen so volume related and the stabilization if you see the comparison and the kind of stabilization on this how specific, also and better on business development overall. A little bit support it also through new startups in Korea.

Unidentified Analyst

Okay, so volumes basically getting better and better loading.

Georg Denoke

No the site of course my guys here are pointing out that there is also an gas tries effect of course in our bigger scheme that is also helping out for us.

Unidentified Analyst

Okay my natural gas past basically.

Georg Denoke

Yes.

Unidentified Analyst

Okay, understood. Thank you very much.

Operator

Thank you. And the next question comes from Neil Tyler – Redburn. Your line is now open. Please go ahead.

Neil Tyler

Thank you. Good afternoon. A couple left from me please, firstly in the cash flow statement can you help me understand the approximately €170 million adjustment negative and that's classified under changes in other assets and liabilities, I probably should understand that, but I don’t, so if you could help me with that?

Secondly, could you possible provide and update Georg on the Sadara project and your perspective timings, revenue contribution this year and next? And is it fair to assume that in the early stage we will get limited profit contribution as fixed costs are really at the same time? And I'll leave it at those two for now. Thank you.

Georg Denoke

Yes, of course, I'll start with the basic cash flow question Neil. So all I think these changes what you are describing is mainly ethics, yes I think it is mainly currency. [Indiscernible] I think we always prefer that you ask really the customer on that end because I think we are here really re-supplier. So from an overall perspective of course I would assume that there is a radio ramp up then when this comes into play, but I think really that's a question for the customer. Thank you.

Neil Tyler

Okay can I ask you slightly differently, so what you are assuming and you are planning in your guidance for this year in revenue terms?

Georg Denoke

I don’t guide location, I think but we do have a positive assumption on the safety development because of the startup.

Neil Tyler

Okay, and on the profit contribution sort of in the first year or is that a fair assumption there won't be a great deal because there is a lot of fixed costs arriving in the P&L at the same time?

Georg Denoke

No, I think this always as you know onsite contracts depend on base facility feels and variable takeouts and I think you can assume in such an important scheme that there is a pronunciation of the base facility fee products.

Neil Tyler

Okay, that's very helpful. Thank you, Georg.

Operator

Thank you. And the next question comes from Peter Mackey - Exane BNP Paribas. Your line is now open. Please go ahead.

Peter Mackey

Good afternoon everybody. Actually it is quite convenient I step in here because I wanted to follow on exactly from Neil's question on the Sadara effects and particularly the basis for you talk about it having a pronounced effect. I understand I think at the moment you are already receiving the base facility so even though the site has not started up yet.

So you are suggesting that the significant part of the onsite contract. What do they costs, the operating costs that go with against the base facility. So, one would assume relatively low, so one would assume that, that's sort of in a relatively high margin. Could you just talk us through that please?

And the other quarter, I just want to check what was the contribution in the first quarter from Chong Ching please? Thanks a lot.

Georg Denoke

So Peter, thank you for your questions. I think really I don’t want to discuss the details of the [indiscernible] scheme here because that is something which is from a structural perspective no different than all other contracts we signed. So what goes against the base facility fee of course they are the differentiation there are these kinds of things that certain profit contribution depends on the will of the customer normally and therefore you have customers where you do have on the variable end and higher profit contribution and you do have customers who prefer really that in the base facility be. This depends on the customer and their schemes and their ramp up that is different from scheme to scheme. So that is what I really can allude to.

Peter Mackey

Can I just check, you are actually receiving the basis of the [indiscernible] at the moment isn’t that correct?

Georg Denoke

Yes we are receiving part of that, yes,

Peter Mackey

Okay thank you.

Georg Denoke

Then your second question was the Chong Ching [ph] deconsolidation?

Peter Mackey

It was energy, I mean yes sort of indirectly. I was actually wondering what the revenue contribution had been in the - because I think you lined it for the first?

Georg Denoke

Relatively a small number for which was around I think, I don’t know it s below €10 million absolutely.

Peter Mackey

Okay, understood, thank you very much.

Operator

Thank you. And the next question comes from Thomas Wrigglesworth – Citi. Your line is now open. Please go ahead.

Thomas Wrigglesworth

Thank you Georg for taking my question. Just a high level one, the onsite kind of market opportunities that are available, obviously start of the year has that continued to deteriorate or is that improved? And are you seeing customers more willing to consider putting projects out to tender given the market environment suddenly seems to have picked up a bit and the oil price is higher? So if you can give us some kind of broader color around the onsite opportunities? Thank you.

Georg Denoke

Yes, thank you for your question. I think really the onsite market against the last call we have for the full year and the guidance we have given there have not changed dramatically. I think that is the summary on our high level.

Thomas Wrigglesworth

Thanks very much.

Operator

Thank you. There are currently no further questions. [Operator Instructions].

Georg Denoke

Okay, if there are no further questions, there is one coming okay.

Operator

We have one last question by John Klein – Berenberg. Your line is now open. Please go ahead.

John Klein

Good afternoon, just a very brief one, if you could update us please on the composition of the purchase price allocation for this year and next year and you are reporting still the BOC separately, but given the American HomePatient acquisition and you remain [indiscernible] from Lincare I was just wondering if you could just talk a bit? Thank you.

Georg Denoke

Okay, I think on the American HomePatient I can say definitely which is minor in comparison to the base of the BOC. The BOC also you know there is also currently swings in that number as I always point out. So it is still around €200 million, probably little bit less now when you see the devaluation of the pounds then you do have the Lincare which is around €40 million to €50 million I think and then we do have American HomePatient which is not yet fully finalized I think, but it will be around I think less than €20 million I think on an annual basis €15 million I assume.

John Klein

That is very helpful, thank you.

A - Georg Denoke

Thank you, John.

A - Georg Denoke

So then are there more questions coming?

End of Q&A

Operator

No.

Georg Denoke

No further questions available in the line. So thank you very much for your questions for the lively discussion. Have a good weekend now and thank you very much, talk to you soon. Bye-bye.

Operator

Ladies and gentlemen, thank you for your attendance. This call is being concluded. You may now disconnect.

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