Q1 2020 Earnings Call
Good morning.
The best Guar first quarter 2020.
Turning to school.
Slide presentation accompanying todays.
And is available in the Investor section of the company's website.
Yeah.
Buster Dot dot dot dot com.
So we'll be an opportunity for you to ask questions today's presentation.
This conference call is being recorded.
As a reminder, all participants will be able to slow.
No I will turn the call over.
The nerve Bert.
Sure.
Let's go ahead.
Good morning, everyone I'm tank car showing yesterday for a discussion of <unk>, that's what people <unk>.
From a reporting financial every time, you know what actually U.S. scenario.
We didn't think people as.
We just got certain non-GAAP financial measure somebody demand.
Foreign exchange.
Sure.
You bet social read the definitions of these natural metrics, including Brechin exactly to ensure that they understand that.
Non-GAAP financial measure nobody messy showing up because you have seen isolation.
It's hard up your total GAAP financial measure.
Our provided supplemental information already.
Before I wouldn't be again I work for my remarks, I don't need to remind you that says that statements made during the course somebody's got show Michael tickets sold one you'll get a statement, which are based on management's current expectations have beneath that subject to a number that we started that Dave that's good color I try to besides the ones, who really before including fructose had maybe.
Yes, the company's control is.
Anything to that but they still kinda back some shows relating to the fact, they called lead 19 pardon me.
Well that description appears to me.
Me too far to <unk> filings with the Securities and Exchange Commission I know what press release.
Speaking on today's call. It if I was deals I mean, scoping, Oh, well why don't overview that first quarter and update you are not worth <unk> strategic priority.
Oh, that's one of the hockney, our CFO will somewhat god. They work that's why not shots.
Got it that we opened according to your question.
Please go ahead.
Thank you.
Good morning, everyone I'm thinking going.
First of all I hope that you want your loved one cogs are safe and healthy.
Leaving an operating in a diebold conceivable Sarkozy cobiz, making crisis is forcing companies like ours.
No that's why workout New York Thermo <unk> College.
He said 40, great southern.
I forgot what.
Well, we take a different approach so our discussion today.
Recognizing that the operational.
Change rapidly in the last several weeks, we would spend any time discussing our first quarter results.
I had more time discussing how we are responding to the core and situation.
As we navigate the current and sort of de leveraging the strong foundations, we win over the past separately.
He's being formation you see.
Like side of this life.
Well the spots you, yes. This big arc has made meaningful progress in executing our strategic initiatives.
So why do you see an uncertain intelligent died disregard the foundation in place to remarks from me leader on stronger than ever.
We also believe.
Our key initiatives and strategies are working we support our future world when we get to these on that.
Let me take you.
There was some big <unk>.
We are encouraged the spirit of uncertainty from a seasonal right.
Strong balance sheets.
Awesome unprofitable business as well as well as an experienced leadership team.
Importantly, we have sufficient liquidity and gosh two month, they know where beat that meet our obligation for an extended period of time.
The next talk about scale.
We I believe Oh, yeah, you're lucky nobody.
The hub gain over 300 basis points market share over the past five years.
Same period, we got we have delivered 25% pay.
Local currency gross bookings.
We have been able to movies.
Good grief, our product offering to cost so much where depart peak real focus holdco spiky just another toll brothers.
Which account for you.
To close and then they key for 62% of talk other revenue.
Great well they totaled 300 basis points during this time.
Lastly, we have the hi, this brand awareness you're lucky numbers.
Well, what the boss to Bacon.
Hey, guys have embraced <unk> over <unk> billion dollars building our brand.
You do you draw where strong brand recognition that goes to 70%.
Our website Tropic if I'm right.
What we do not helped by a significant amount of marketing dollars.
Drive traffic to our side.
These strong Bob recognition, coupled with our leading technology platform.
This will translate into strong demand for I work.
Which is the most downloaded traveled you're lucky Dominion.
We have the largest client base in the region I'm confident that we we've continued to come to new customers Bart digrandi, even to accelerate the cheap.
Like Portuguese that's taking place you left Kim treat there by the current state I've called policies.
These are difficult times for.
It's mid March mean comes just how you should probably bodies to mitigate this spread the called like Nike operating philosophy has to me. So badly would use people are practically no troubling either domestically or internationally.
Most countries are in some form of real down along the way.
John talked about our main markets I did not implement you take stay at home policies body all their problems by BRAF Unum, Mexico airports remain open although operating that significantly reduce goodbye.
Colombia, social restricted international and domestic probably why do you live we reopened some domestic or robs m-.
We do not know how long these restrictions.
Well, the which faced challenges before.
We always came out stronger on the other side.
Moving next to how were currently responded to call Bye bye.
[laughter], they even full you'll see on their wide side that's like.
Before we embark gabi team want be known for several months. However, what did he bought them right now you've got the bar blocked be muddied the immediate challenges important points I'd like to emphasize how did that we will prioritize because once they see all the spit out employees and customers.
We will maintain the sustainability of our beef.
Right the number one.
The health and safety of our employees, we have taken proxy boxes to protect our employees you syncrude implementing social do you still think probables on work from home policies. Our responses continues to bottom line with best product did you not core does to the recommendations from the national accounts Saudis on that.
<unk> has organization.
Whereas our focus on our customers and do we know where best let's see them with adjustment due out probably done by providing them with the possibility to postpone the aircrafts.
The culture of innovation I'm, one of the base I get teams in the region. So we said.
We weren't even we beat a dead a website I think automation, so that I work awesome us with money, they're booking then says in and therefore to support our Carlson.
Next is showing this thing nobody difficult.
Prudently managing the business so the near term while at the while continuing to tanks and the long term has optical.
We are completing these you said another way.
Finally, we love our responses for coffee <unk> tea March Unfortunately, sadly it said I'll stop pharmacies to coordinate I wouldn't exports. We are focused on ensuring business continuity and we have you been up being robust contingency plans to address a wide range of Tonight.
We are aggressively reducing all structural and discretionary operating expenses and challenging what is essentially and making sure. Every dollar spent you foresee.
Later in my presentation, a we'd go Oh, well you are doing unexpected costs I.
It's worth pointing out that we have begun gossiping program in the fourth quarter two telephone Nike.
We also took some additional cost cutting measures heavily downright I'm, probably even before the call about an 18.
They benefit from those are the airports are hardware the apart.
Our first quarter Clinton Clinton SaaS.
I was talked about costs were down 16% from the fourth quarter of 2019.
No more than ever we will continue to stay focused on gosh minds.
We believe we have significant cash on hand to weather the quarter not buyers.
256 million I've caught that Ed.
Lastly, we are currently having positive discussions with the best they seem with respect to the acquisition we announced in January.
Well, it's too early to provide specific.
Our expectation you've got to find that agreement we have significant changes there so see already down what.
I should we expect to postpone it gosh.
Legs relate to be submission for at least two years.
However, we cannot be sure whether the proposed changes to the purchase agreement will be access.
It's trading negotiation me Krieger a cancellation of video.
[laughter] deletion continues to evolve so rapidly that is difficult to predict the future we much started.
Why <unk> body sounds kinda, something you'd be drawn to weather related disruptions or not.
So.
Well, we say shows the reality is that we have never seen the corn scenario on the subject to all those games.
Nevertheless, we are committed to being transparent about what we have seen in the marketplace on whether you are doing to respond.
We will continue to be forthcoming as we navigate these unchartered territory and we believe we we have more BCB in the coming on.
At this stage on stobie.
Moving next to.
A quick overview all parts for the talk shows on gross bookings.
Overtime, we have been able to successfully Greece. Both total just talk shows on gross bookings, while gaining market share.
We have been able to complete the despite some challenging macro conditions he like nobody got.
By adjusting Opportunistically, our business model and I'd be more products and services from for our customers.
We are no bini box you bite on.
I'm personally did go what has crisis.
As you can see indie star.
Well it doesn't talk shows were down 23% in the quarter, we package, it's called that another probably pollux decreasing faster than they had some success.
Those bulky disease called there's another probably product.
It's actually went down 28% in the quarter on a reported basis, an accounting for 40% photos transactions, what excellence actually declined 20 person in the period.
Gross bookings decreased 19% or non FX neutral basis asked report you gross bookings were down 32%.
Reflecting the impact of called between 18 and grow like Todd.
We don't do you mind, nudging Dina as well as some.
Hey, the bookings in fourth quarter, two so somebody dean and empty space some of the new products in both from Kabul outside the country I love to meet the depreciation of the resi and great.
The largest in.
So our business card in the second half Mark.
I'd be tied mostly all let it go normally shutdown.
And can we saw in Nike's Hypersound decreased gross bookings in this period compared to the second half of March of the prior year.
Unfortunately, we speak Dod trend to continue throughout the second quarter.
Turning now to page five for a more detailed discussion as to how we are reducing cost and the associated benefits for objective for the next two quarters.
This is a good all open debbie each country's preventing the I'll pick up the baidu differently.
Accordingly, our markets with progress through these and recover on different timelines.
These are some complexity from a geographic fungal for you.
Being aggressive cost takeout like anybody that'd be great. He's he's kabi in our revenue.
When you file structural cost.
Fixed portion of our cost of revenue and operating expenses.
It would include items such as the fixed portion of the call center spend that remain after outsourcing to bridge the fixed portion of selling and marketing primarily Barcelona, yeah. They as well I think I'm proud to be below.
We do not include known Gosh, I did touch on depreciation and in Peru.
I'm not at a cost associated with severance packages on the I know, we see shut off base today.
Well I addressed the anticipated <unk> dot copied my team we are taking steps to ensure that cost. We made a line. We did agree Cindy Mike. Let me think some of the main measures we have already taken through lower structural cost.
Support our 40 gosh.
But we temporarily reduced salaries of the Executive Committee board of directors and senior management by 50%.
A middle management by 25%.
These reductions we stay in place to the second quarter of two sounds good.
We also eliminate you first half of two cells on just the bond is used to all employees I'm, we're leaving any inflation salary increases.
Next.
To better match it staffing levels would you mind activity, we have implemented a hiring freeze hopping to use parts of our workforce reduce working I was an increment is they believe in certain locations.
So we acquire B. I could probably late last year and are moving ahead with the consolidation of the Beast is accelerating the capture of synergies.
<unk>.
We are backing all discretionary operating expenses are not challenging what do you sense and making sure it would be the all else then he's a popular.
We're also taking similar approach, we got where supply.
An important area to effectively manage as we look to improve terms and conditions I wise, we are reviewing our cogs drugs uncommon.
Lastly, we have both or copied does but other than what do you absolutely essential has already been committed.
My moving quickly and decisively we're out but we do not necessarily spend are gaining maximum flexibility for the second half of the year as we see more bodies on deal.
No what does this all translate into on the list side of the slide we have provided bar chart, showing the progression of our estimated stock drug cost.
We're already realized a 16% reduction from fourth quarter two calls on the team to the first quarter 2012.
He's was driven by debt restructuring implement <unk> in the fourth quarter and outsourcing of our called said so in done already Twentytwenty, which we succeed.
They're more body old customer care cost structure.
Bias airport there this year, we anticipate our structural cost to be 45 person lower than yearend 2019.
Importantly, <unk> they want to see don't revenue synergies.
Got to be nimble in response to the developing situation. We will continue to drive cost us no that's necessary to mitigate the profitability pressure from lower revenues.
I think we beat deliberate and thoughtful about how we do these so we do not under my core capabilities and the neighbors that have driven not where success over the last few years.
Moving to slide 640 discussion of our liquidity position.
We are properly managing our strong balance sheet liquidity position in this environment.
The end of the first part, though we've got 276 mediums in gosh.
I said, we want to unrestricted cash on our balance sheet no long.
I was shocked that of $17.5 million I've walked away was lower by close to 2 million sequentially.
I saw Mark City, Fars, who sells on Wednesday, I worked don't go Nick operation short term obligations amounted to 52.9 million.
The for a niche aggregate, but yet was probably hundred 20 million at yearend 2019.
We are also implementing a senior something pressures, let's see cost so much would refunds on rescheduling, including Easter in bound chose that our customers can use you mean this year or in some cases alley next year.
Well, we continue to evaluate the situation more you pull weren't I'm planning to prioritize gosh would be station to me I wouldn't be like we do you need.
Our strong free cash flow healthy balance sheet continued to remain the core strength I think a buddy divided by between diesel uncertain times now on the cost side.
I thought we set us up the measures I just spoke about on the previous slide we currently anticipate that their runway. So struck like cost for this year as compare to 2018, we continue to improve with food savings expected by Q3, two helping on Friday.
We estimate that the run rate struck like cost will be approximately 34 million dollar <unk> second quarter, 2000 uncertainty and approximately $28 million by the airport there have to sell side of it.
In addition, probably gosh real perspective savings associated with our topic suite actions, we love go where liquidity buffer.
These measures are all part of our balance approach to address the impact of that they make on our aim at supporting our free cash flow into south on them, but as we navigate through these I've talked or waters.
Why do we feel that he's too much uncertainty at this point to provide a reasonable estimate for the full year financially, but that is related to called me they team.
We want to provide we're sure.
Were being Bose brought you bought not day, managing our financial position has it been they'd be unfolds.
I will now turn the call over quite radical who discussed her work first quarter results as well as far the common about Colby and how we are responding.
Thank you some young I'm. Thank you all for joining us today.
Let me Echo what I mean, unsaid I hope you your families and colleagues all safely what.
And we started with highlights from our first quarter results, including the impact from Koby 19.
Then people to expectations poor financial performance moving forward in light well devoted pandemic.
We experienced a declining transexual some gross bookings across key markets.
Both.
I was reported on FX neutral basis, reflecting troubled disruption worldwide driven by troubled bonds I know wouldn't mind you could kogan 19 started in the second topic Mark.
This was father taught sort of aided by currency volatility, particularly Argentina, Brazil.
In Brazil, we so year on year declined 18% introductions I mean keep person in FX neutral gross bookings driven by Koby 19 on an overall industry contraction.
Well FX neutral HSBC remain unchanged.
18% depreciation of the Brazilian real led to conduct a low double digit drop you not reported I guess fees.
On a 29% decline in ask reported cost bookings.
Moving to Argentina transactions on FX neutral gross bookings were down 47 on 33% respectively. You O'neil.
In addition to they compete love, though that began in mid March I Trust phones to covert 19 outbreak.
Demand was impacted by the were road recessionary environment.
Well I knew 30% duty on resi dense international travel spend.
That became effective towards the end of last year.
This resulted in advanced troubled purchases in fourth quarter 19.
Well the us lower demand for international troubling to first quarter.
I was reported gross bookings were down 58% in line with 58% peso depreciation.
Finally.
For the rest of Latin America.
We so year on year declined, 14% intersections and 12% in FX neutral gross bookings.
And on FX neutral basis.
I guess piece were up 3%, mainly driven by a better performance in packages, Mexico, Colombia and Chile.
That's reported yes piece were down 4%, while gross bookings fell 17% in the period.
No.
Moving on to the piano on slide eight.
It's neutral revenues were down 34% year on year in the quarter.
In addition to the significant impact on the global Coke prices on the road travel demand on our business. Several related factors also contributed to the sharp dropping revenues, which were offset by their revenue contribution of younger salad.
First customer refunds, reflecting cancellation the quarter.
Second in this quarter, we also probation for I'd say to customer response for the second quarter.
I mean, the case of Argentina.
The nation's quite so he should until September 1st due to the recent done can you have purchases before that date.
And lastly, we also lowered costumer piece I'm provided other incentives to drive demand Indeed tried environment.
Importantly.
Despite difficult environment.
Able to monetize the bookings made during the quarter.
Comparable revenue margin, excluding the impact from actual and cancellations flight ones would have been 11.2% compared with 11 and a half in a year ago quarter.
Now please turn to slide nine.
As you can see on the three charge from the stage and measures taken in fourth quarter 92 father streamline operations in support areas as well as fulfillment centers along with initiative.
Rapidly implemented in the first quarter to adjust our cost basis to be unprecedented market dynamics.
Already starting to drive important cost reductions across the business.
Starting with cost of revenue, which was down 26% you don't you.
In addition to the drop in transactions in the second topic March.
Cost of revenues benefited from the outsourcing in early January a significant portion of our customer service activities you Gotta mission to the restructuring implemented in the fourth quarter Lucky.
That's very result, both these actions on a per transaction basis cost of revenue declined to $16 from 17.1.
First quarter 90.
Also note that cost of revenue is fully vulnerable except for packaging and central costs.
Therefore, we expect to see a father absolute truck in this line item lightly, but koby 19 on trial they persist.
Next take a marketing.
He declined 22% junia, reflecting the cancellation or direct marketing spend since March 13th.
On a per transaction basis sales and marketing increased 65 basis point, you, reflecting the inclusion of yeah, it's kinda they less marketing cost.
Location structural marketing costs lower number of transactions.
A weather.
He was 150 basis points below comparable levels for fall 2018.
In addition to that like marketing selling and marketing expenses.
Also include six marketing costs, which are part of the structural cost that you expect we'd be father reduced driven by their legal annotation implemented in April.
Finally take on content than DNA costs declined 11% year on year.
Excluding costs associated with jackets phenomena and severance expenses from the Bces reorganization given did this quarter.
Pick on content expenses would have been 26% lowering the PV.
We expect to see father reductions in both taken continent DNA from the cost savings can you said you see implemented in April.
These cost savings on synergies are anticipated to become more apparent in the coming quarters I'm countries. It to father increase the flexibility of the company's cost structure.
What do you know one.
We expect that these restructuring we drive obviously our cost structure, we just 30% of fixed cost measured on 2000, and making PBT levels.
Moving on to profitability on slide 10.
Comparable adjusted EBITDA was negative 1.4 million compared with a positive 15.2 million in the prior year quarter.
Comparable adjusted EBITDA excludes.
Came from 2 million in the following extraordinary charges.
Exceptional cancellations due to Colby 19 for March.
The results for Q2 across the region.
So these are for Argentina until September 1st and nonrecurring restructuring charges.
Let's now turn to slide 11.
We closed the quarter with a solid balance sheet and healthy liquidity to support our operations.
Cash and equivalents at the end of March including pulled pork C. Medias restricted cash amounted to 225.9 million.
Additionally, we have minimal working capital related debt.
Cash flow.
Or did I 68.2 million use breaking punks, reflecting nowhere shades I'm, probably I mean.
Even the disruption from the Cobiz pandemic.
Importantly in the quarter, we canceled a significant portion of the tourist payables completion, we shot at year end 2018.
Which explains the harder 34.6 million investment in working capital in the quarter.
Remember this is not each of our business have some natural impact on the first quarter of each year.
However, given this unprecedented crises the seasonal effect was not offset by relevant new assays in first quarter 2020.
On the other hang Ao Brasil books balance decreased by 8.6 million.
<unk>, our net aggregate operational able to position to only 52.9 million.
We believe our cash position together with expected cash flows from abrasions are sufficient to meet our economy anticipated cash needs beyond the next 12 months.
Moving next to page 12 for a lot though.
We close first quarter 2020 will have minimal level of T V. P. D into second a couple of March.
Reaching our year over year contraction of over 95%.
April has shown similar performance, which we expect to continue throughout <unk>.
Due to 2020.
While the unexpected global economic shock being felt across all our countries. We are responding accordingly on our teams are focused on three objectives.
Number one we are adjusting to the current operating environment I'm staying vigilant in our short term scenario planning.
Number two were maintaining our long term strategic focus and number three.
They are focused on emerging from this period without bces leaner and ready to ramp up as travel demand recovers.
Now I'd like to conclude with a few important messages.
First we are confident the strength.
The resilience and there will always central whole company.
We we successfully navigate these pandemic.
We have a strong balance sheets and sufficient liquidity and cash flow to maintain our business I need obligation for a prolonged period of time.
Second we have a proven low cost operating model.
We will manage our cost base to respond to market conditions and be able to quickly adjust to higher demand on a normalization in our markets.
Third.
We already adopted quickly to the current environment. While also best book between ourselves to win in the post Koby word.
While these would be a challenging times with significant uncertainty we wouldn't be focused on managing what we do you know we're comfortable.
On to mitigate the impact to the degree possible.
And with our higher variable cost structure, we can incorporate a slow ramp up.
For what we are highly focused on managing through the pandemic.
We're also continuing to advance strategic initiatives that will be critical lever for us to drive the business going forward.
Got end.
Were currently in discussions with best day with the goal.
Minimize or eliminate cash outlays on team 2022.
Last despite these near term pressures, we see the potential for the post crisis environment could positively impact our business.
The current restrictions you know markets are temporary.
Over the coming months, they will likely change and eventually we will return to a more normal operating environment.
Oh, well adopted operating model.
Focus on the customer journey, we had about sports relationships with customers, allowing for sustained long term growth.
As we look ahead, we expect environment to remain volatile or they could get 19 pandemic consumers financial security both aboard.
How do we remain confident in the strength and resiliency or brand over the long term.
Now with talented leaders and employees, who are executing against our strategies.
Reacting to current changes and capitalizing on opportunities that these context persons.
This ends our prepared remarks, operator, please open the lines for questions.
Thank you went over here and the question or interest sessions to ask a question you might start one one.
Yeah.
We are usually the speaker. So we are seeing swings [laughter] pressing the keys.
I would encourage your question husband address the worst withdraw your question. Please press Star then through.
You asked me I'm wondering are so good question.
More questions really please rejoin the queue.
At this time, we'll pause momentarily to assemble our roster.
Today's first question comes from Rodriguez Mr., well Oh. Please go ahead.
Hi, Good morning, and thank you for taking my question Oh. So my first question is regarding cash burn in next few quarters I know you release I need to me off structural go spot.
Well liked to have if possible loving more color on your short them up over gay shows why now that you would you be able to extend maturities on.
Whatever what they were color you can provide them that that would be helpful. Thank you.
And Oh, what are you.
Yeah good morning.
The short term organizational the company can be pretty much let's say put into buckets. One day, what we called <unk> net and operating diabetes ambitious and payables my notes receivables.
The balance we have over there that actually response for the next year.
He is $52.9 billion, what we're doing they are east thing clearly we are adjusting in most cases, the terms and conditions Oh, the trouble, but our clients have purchased.
Many cases, we are actually providing boucher score for usage in nature on in the year, Let's say third quarter fourth quarter, when we actually expect particularly in <unk> and <unk> being up 2021 that that travel should be should we quite open.
And we also like of course as you might imagine in most cases, even adjusted cost of due to two total claims.
On a he's not we're just like Josh it's teak into precisely the terms and conditions on the tickets and given the money backdoor times and <unk> in those times now so again deal would be an impact on days companies and gosh, what any cost resources that will actually start coming down over the next.
At 12 months.
Yes, all yet another piece or short term obligations, we show that he's 40 bucks by all the receivables that east debts that we have taken in in Chile in particular over there we have a close to $17 million that said before he started by receivables. So we've paid down.
True connect with the steel so beyond that the company has no. Other short term obligations source as note and short term obligations are just a small portion on the cash on the Cleveland The company has.
Right.
No I was very helpful. Thank you.
And what comes on now.
I don't know how show Edward Russell with Keybanc capital markets. Please go ahead.
Hi, good morning, and thanks for all over the very helpful detail I guess first I know that you historically take some forward position on air inventory in hotel inventory I think some relates to packages I guess.
Is there any kind of remaining obligation forward and I have you been able to ratchet down that I bet that capacity and then second any commentary I know that you have a lot of credit partners, but any commentary on the performance of your existing customers from a credit perspective, and just remind us if there's any default risk or delinquency risk that you bear. Thank you.
[music].
Sure and I love to jump in here again and.
With regard to it there did.
The second part of your question as you.
As you as you recall.
Our business model, we are not exposed to credit risk from from our clients.
So so from that perspective.
We feel very.
I'm very comfortable and we do not expect it to see it to see and pay and impact on on the spot and we are also as you know the company desktops receivables and this year goes way that we'd have treats its supplier network and and and dependent on.
On on those receivables are pretty much a dose exposure respond pretty much either on receivables on also on it so not drum tickets. Okay. Like is so far and we have not seen any any deterioration of dose and all those metrics and but again and we need to continue monitoring.
Got carefully but again, let me stress, but again that we don't have played risk when it comes to to our clients.
On the first part and of your question and yes, as you might recall and we have been advancing on this fuzzy on having a more inventory.
However, I mean, very importantly today the inventory of the company is close to zero is so we have very much immediately adjusted and those inventory levels and actually decreased him too close to zero level. So there's nothing much easier to report when he comes to inventory that we hold another budget.
Great. Thank you very much.
Our next question today comes from Eric certain yes. Please go ahead.
[laughter]. Thanks, so much for taking my question, maybe to a bike and won back into your thinking about the demand side of equation and how it might come back how are you thinking about domestic travel versus out of reach and travel and all you were winding any of your initiatives on either the inventories side on the marketing side just to take advantage of the way.
I think this on wind told me other side Oh cope with 19, that's number one number 210 picking it up on the relationship between the company and Expedia and somebody obligations EPIK systems that relationship and how they might evolve.
In this environment. Thanks, so much.
Hi, Eddie diseases like here. Thanks for your question.
Oh that month cyber Yeah, I think we we expect.
The that'd be my way Green Dot is we need surely be more constantly there was still make to travel.
The obviously, we're already working.
So I wore England diary and ER our sights on features you know that'd be ready for that could be might that in.
All countries our share of the domestic probably then I'd be larger than international travel. So we feel that we'd be well see should it take advantage of that the complex wouldn't be month returns.
I guess for your second question regarding yeah.
That relationship evolves or I mean has continued to be saying gosh, you trust, we'd have a contract.
Obligation as you noticed from them our.
Hotels outside like Nobody got and Oh, we are working with them to adopt.
Relationship on the contract.
Look we're going to see gracious body, where copper I mean, a buddy activity.
Great. Thank so much.
Ladies and gentlemen, as a reminder.
Ask your question. Please press Star then one.
There is next question comes from Southern Koppelman account.
Hi, Good morning, you said Emily on for Kevin.
I was just wondering if you could update us on your current cancellation policy.
Do you offer customers the option of travel credit or full refunds.
And given a lot of your customers paying installments could you help us understand the mechanics that those refunds. Thanks.
Sure Emily and.
<unk>.
And so then.
Like I said these policies are pretty much done the ones that are are actually included and on actually available four times the that the minute they actually purchase that tickets online no. So, though we take a lot of let's say caution on our clients have been readily available information.
On the terms of what they have purchased and having said that.
Having said that if we could be working is strongly with our suppliers and to try to adjust in the benefit or clients and the terms and conditions on the contracts in all cases that that was possible and so and in such a scenario C.. We did we for argument sake, we actually.
Justin on Nonrefundable ticket to our refundable one okay. We are we are allowing those clients it to actually do further troubled purchases and <unk> and <unk> and actually it gets through vouchers <unk> access to and Nancy Miller and see me that alternatives.
Later on in the.
Fourth quarter, 2021st quarter 2021 that as you know in South America, and those two quarters, our peak when it comes to control.
And.
They are we on on Oh, not we're not really the cancellation policy when it comes to to a p. an l. impact. Okay. You. We have included on our earnings release, a 12.5 and million dollars at other either outright cancellations from Q1, it on a provisions for canceled.
Patients that will extend and threw out a Q2 it on in some cases particular in Argentina cultural extend even into a.
Right. It on portion pay off QC. So we have already lets say provisioned they impact at all what cancellations would travel on our piano and from that perspective.
So.
Ill pause for a minute here on TV.
Any follow up questions on this.
No that's very helpful. Thank you.
Well, ladies and gentlemen. This concludes the question answer session. However, during the conference back over them in Silicon Valley for hallmarks [noise].
Well I would like to thanks, all for joining in D. said, particularly challenging comp.
And I would like.
I was hoping by going through our next call on thank you very much.
Or being part of the conference today looking for work to see your Ken on our next call Bye [noise].
Thank you. This concludes today's conference call. We thank you all for hunting today's presentation. You may now disconnect your lines have a wonderful.
[noise].