Q3 2020 Arcos Dorados Holdings Inc Earnings Call
Good morning, and welcome to the Arcos Dorados third quarter 2020 earnings call.
A slide presentation will accompany today's webcast, which will also be available in the investor section of the company's website Www Dot Arcos Dorados dot com backslash IR.
And as a reminder, all participants will be in listen only mode.
There will be an opportunity for you to ask questions at the end of today's presentation today's.
Today's conference call is being recorded.
At this time I'd like to turn the conference call over to you.
Slide <unk>, Vice President of Investor Relations. Sir Please go ahead.
Thank you Jamie good morning, everyone and thank you for joining our earnings call.
With me on today's call are Marcelo Rabach, our Chief Executive Officer, Medina, Tanenbaum, our Chief Financial Officer, and we still are going out to our chief operating officer.
Please turn to slide two.
Before we proceed I would like to make the following safe Harbor statement.
Today's call will contain forward looking statements and I refer you to the forward looking statement section of our earnings release and recent filings with the FCC.
We assume no obligation to update or revise any forward looking statements to reflect new or changed events or circumstances.
In addition to reporting financial results in accordance with generally accepted accounting principles.
We report certain non-GAAP financial results.
That's just are encouraged to review the reconciliation of these non-GAAP financial results as compared with GAAP results, which can be found in the press release and unaudited financial statements, we will file with the FCC on form 6K.
Our discussion today excludes the results of the Venezuelan operation both at the consolidated level as well, it's where the Caribbean Division.
To the country's ongoing macroeconomic volatility.
For your reference we included a full income statement, excluding Venezuela with our earnings release.
I would now like to turn turn the call over to our CEO Marcelo Rabach.
Thanks, Dan and good morning, everyone.
I Hope you and your families are doing well.
So they wouldn't that I view the topics listed on slide three.
We will start with an operational update then we will take you through the details of our third quarter results.
Our recent events.
Well, we'll wrap up with some early thoughts on next year.
You have heard me say on each aboard gold, but without a doubt we kept the best restaurants system in Latin America.
The heart and Soul, you said were people who.
Who have worked hard and overcome significant obstacles to ensure that our guests enjoy the safest most convenient restaurant experience you know or region.
They make us very broke every single day.
Yeah, they phases of our plan to navigate the pandemic are summarized on slide four.
Our broad deep an aggressive approach to the crisis Mannesmann face in board Prioritise, you know where people can get.
Supporting our communities and stabilize you know where gas flows to ensure the long term health of our business.
We are now solidly in the recovery phase of our plan.
Everything at least once sales segment in 99% of all restaurants.
By focusing on the three D var business drive through the Liberty and de she does.
We're also building consumer confidence with our mcpick, either us or muck safe program, we are gaining market share across the board.
Sometime next year, we expect to enter the 40 Bible phase of our plan.
Not these when all or substantially all our restaurants should return to full operations.
Well, we'll build on the success based on learnings from 2022.
To support it farther regarding sales and capitalized on the revenue excitement for the Mcdonalds brand in our region.
Making them more to be they look Oh, we're operations on slide five.
In addition to reopening 99% of our restaurants, we are already operating all size segments, you know about 70% of our locations.
A couple of also reopened around 90% overall would be start centers.
He's gone ahead of the summer months in South America.
Wouldn't be certain thats, usually performed strongly.
We are also benefiting from operating the response largest freestanding restaurant footprint.
With regard to basi deep system wide comparable sales in the month of September.
Well, we are gaining significant traction the base about recovery would be subject to how government restrictions aboard.
We are still facing streak did show some both out of operations on the restaurant dining capacity.
We have successfully hopes that some of the reduction in on premise sales with very strong growth in both drive through on delivery.
But in the long run we will still be a peabody destination for Latin American families.
I will share more thoughts on that when we provide our any outlook on 2021.
Let's turn now to the highlights of the third quarter on slide six.
I want to see somebody compatible assays, which include or restaurants, you know where system for more than 30 month, where the open or temporarily closed recover throughout the quarter.
In fact, comparing the last month of each of the last two quarters.
But I will say recovered by about 25 percentage points.
They see these drove this sustained recovery in topline results.
Got together with efficient cost management generated positive consolidated EBITDA starting in July.
Reaching almost $26 million for the fourth quarter.
You Fucked, all four divisions and about 80% of our markets the LIBOR basi deep EBITDA in the quarter.
Notably well see how this solid rebound and we were particularly pleased with the Caribbean performance.
Adjusted EBITDA in the Caribbean, We just generated mostly income currencies such as the U.S. dollar and the Euro was almost 2.5 times higher but it was the prior year period.
Also as we mentioned on our last two calls we brought deeply implemented aggressive cost in best men I guess mannesmann measures that stabilize our cash flows by the third week of April.
These limited big crises relate to the increase in our short term debt.
Which we have already refinanced through liability management transactions that might be I know will describe indeed take do they.
I will turn the call over to reason, though put.
For a deeper dive into our sales trends and other operational highlights in the quarter.
Thanks, Phil and good morning to all of.
You have just heard about our consolidated topline results. So let's take a look at health sales performed on a divisional level on slide seven.
System wide comparable sales remained highly co related to the penetration of freestanding restaurants in our divisions.
The Caribbean Division delivered comparable sales growth of 1% in the quarter.
Two thirds of our restaurants are freestanding, allowing us to leverage did right through an expanded the library sales segment.
Brazil comparable sales improved by about 20 percentage points versus the second quarter.
Freestanding units dinner weighted positive comparable sales starting September boosted.
Boosted by sustained growth in drive through and delivery.
The trend continued in October when.
When comparable sales for all of our goal that I lost went above 90% of last year's levels.
No, let and SLAD had a slower recovery due to stricter government restrictions on operations.
We were only recently able to reopen some mall based stores in Panama when operations in Argentina are still limited due to ongoing virus related restrictions.
Although the recovery has been slower we are still operating from a much stronger competitive position in most of the depletions markets and expect to get up to a significant share moving forward.
Let's talk about how the three d's are performing on slide eight.
Starting with dried through we generated record sales levels for this segment during the third quarter.
On a constant currency basis, right through sales rose, 54% versus the prior year period.
And contributed 46% of the third quarter's system wide sales.
The Liberty also had the best sales quarter ever growing more than 180% in constant currency terms, there's whose lots here.
In fact, the LIBOR is cumulative sales for the first nine months of 2020 are already 36% higher versus the full year 2018.
The service continues to grow in popularity and he is now available in 17 of our 20 markets more than 1600 restaurants.
In Brazil, we gained significant market share ended the Liberty segment, starting with the largest revenue base in our industry.
Local currency sales grew 22% versus the second quarter of this year and they tend to run 47% versus the third quarter of last year.
In both cases, we have further building our brand strength by exceeding customer expectations with service times that are much faster that the breadth of the QSR industry.
No matter, how we look at it whether its proprietary research third party sources or comparative growth rates. There is no doubt we are capturing market share and consolidate in our brand leadership in both the sales segment. Finally, we're building on our industry, leading digital platform that again.
We generated 40% of system wide sales in the quarter, we have more than 43 million downloads since launching our mobile site up a couple of years ago and the number of active users continues to grow as well.
So far we have taken the mobile order on pickup option, two or three markets, Argentina, Brazil, and Colombia with plans to continue rolling out these digital build in bulk across our regional footprint.
With each new feature the mobile App is serving as the backbone of the company's digital transformation.
Yes, Kevin grow a number of ways to interact with us leading to higher up we see some numbers more digital use activations and increasing engagement.
We've recently launched Mickey's up what's up but that interact with guests through artificial intelligence in Brazil.
We're getting to know over gets better and that is leading us to new opportunities.
We started the year with two multi disciplinary teams or what.
Focused on the library and digital marketing business models and strategies.
Recently, we added a third squad to develop and execute our E commerce strategy.
As you will hear from much sooner or later, we continue investing in the digital transformation of particles, what else and I look forward to keeping you up to date on the tangible results of these initiatives.
Let's turn now to an important part of the on premise guest experience on slide nine.
We first told you about democracy, he those or make safe program on the March on this call.
We were in the early stages of the pandemic, but we had already rolled out a branded and coordinate a program to convey our industry best safety in high teens tenders to employees engaged.
The program has helped us gain in breadth and brand trust metrics.
Far more than the nearest to competitors in each market on the screen you see some of the positive reactions. We received over the last few months with words of thanks and appreciation from overseas them.
Looking ahead, we consume this concern about their health and safety for the foreseeable future. We believe the Mac <unk> Cheetos program will support our goal of consolidating the brand's position as the most trusted restaurant chain in Latin America and the Caribbean.
I didn't know I will turn it over to you know so you can take us through the company's profitability balance sheet metrics and capital allocation priorities.
Thanks Louise.
As I said already mentioned, we generated positive adjusted EBITDA in the quarter, both at the consolidated level I mean, each of our four divisions.
It's worth repeating how pleased we are to see the performance in our main market rosy.
And in the Caribbean Division, where we generate hard currency cash flows and see significant opportunities moving forward.
Taking a look at our EBITDA margin on slide 10, we had an important sequential improvement of 19.8 percentage points versus the second quarter.
Our food and paper costs demonstrated continued recipients generating 90 basis points of EBITDA margin leverage versus the second quarter and 30 basis points versus the prior year.
This improvement came as a result of the success of the city DC together with effective revenue and menu management.
Yes, our sophisticated localized supply chain.
They were costs also improved significantly gaining 370 basis points of productivity versus the second quarter due largely to improved sales trends and optimized restaurant stuff.
The occupancy and other operating expense line also saw material rebound from the second quarter. When we had non recurring expenses related to P. P E for our employees and higher commissions to the delivery aggregators given the increase in sales in that segment.
I should also mention the great work by our real estate team, which has kept the increase in else I rent expenses to a minimal while we work to leverage our remaining fixed costs.
Strict control on some gionee resulted in an 8.2% decline in constant currency, despite a 9.8% weighted inflation rate.
We are proud to have achieved at least read real reduction without implementing layoffs.
As our sales continue recovering and growing through the end of the year I mean to 2021, we expect most of our cost and expenses to normalize further.
Before moving to our balance sheet and cash flow I want to take you through the liability management exercise and we recently completed.
On slide 11.
As you know.
Through proactive management actions, we were able to limit our cash burn so the worst part of the crises. In fact, we stabilized and then began generating positive cash flows at the end of April.
Nonetheless, we didn't increase our short term borrowings from our partner banks.
In order to eliminate the associated refinancing risk I'm fully repay our short to net well.
Well, we opened our 2027 bond and issued an additional $150 million at the lowest cost in our history.
Five point, 46% you'd to maturity.
We also offered our 2023 bondholders the chance to exchange their holdings for the 27 bonds in order to further extend the average maturity of our long term debt.
Exchange was very successful with more than $130 million moving from the 20 threes. So the 27 balls.
Hello, both transactions our short term credit lines are fully available the outstanding principal under 20 cities, so very manageable $217 million on the 27th stand at 500.
$55 million remember, we have the reversal of instruments in our favor the partially offset the companys total long term debt.
The average maturity of our debt has gone from 3.8 years at the end of June to 5.3 years currently.
We are also about two thirds of the way through executing the needed the reman teams to rebalance the currency exposure of our long term debt.
50, 50 mix between the U.S. dollar.
The Brazilian real.
Looking at how we managed our debt and cash flows on slide two of us.
As expected our net debt to adjusted EBITDA ratio Rose to 4.7 times, that's tough September thirtyth.
Due to the decrease in our trailing 12 month EBITDA.
In fact, since we generated positive cash flows in the quarter, we reduced our net debt by $20 million versus the end of the second quarter.
Although we expect this leverage ratio to rise to a high single digit at the end of 2022.
To improve significantly over the course of 2021, primarily because next years EBITDA should be materially higher versus this year.
By the end of 2021, we expect our net debt to EBITDA ratio to approach the high end of our comfort range of two to 2.5 times.
Turning to our capital allocation on slide 13, we spent $12.3 million some capital expenditures during the third quarter.
Through September we invested almost $65 million in capital expenditures, including a limited number of opening some modernizations compared with our original pen.
As you have heard from lease we also continued investing in the digital transformation of our company.
With better cash flow generation as denoted to take advantage of opportunities in the marketplace. We now expect our total capital expenditures to be around $100 million this year versus our previous guidance of $80 million.
As we mentioned on our previous call. We expect to close around 60 are far exceeding restaurants to focus the company's resources on the most profitable markets in restaurant formats.
I am optimistic about the future and we are already working on a well developed pipeline of new restaurant openings and Modernizations put 2021.
Back to you might say, though.
Thanks Mariano.
Before we talk about expectations for next year, let's turn to or yes. She framework on slide 14.
On prior calls you heard me talk about where I sit I would do it on a recipe for the future.
I am pleased to report that we shot really our secret unwell socially but on sustainable development report.
He dating the progress we are making against our five pillars of a sustainable sourcing driving that change.
Yes, you know recycling youth opportunity and commitment to fund these.
Importantly, this years report was prepared in language, both global reporting initiative on sustainability accounting standards Board guidelines.
Today I want to briefly highlight recent developments in pretty well bore yes cheap pillars.
In commitment to families. We have constantly in France, the nutritional value and quality of our products.
With the most recent step being the elimination of artificial colors and flavors from some of our most popular products with our clean label initiative.
Use opportunity, it's important for optical hotels for the communities in which we operate.
Each year, we hold the Columbia or Big day donating the days beat my sales Brooks seats to our partner and Geos.
Last year, we donated more than $5 million.
This year started strongly with the grandiose in Chile.
Incredibly despite holding it mostly be taught event she doesn't run via raised more money this year than last year.
Well I guess, you know recycling is a growing area of opportunity to make a positive impact.
In Costa Rica, we recently continues eliminating single use plastics from our packaging.
Removing more than 16 million units from our restaurants.
As a company we eliminated 600 tones of single use plastic in 2018.
Another seven countries don't in 2019, and we expect to eliminate another 300 doors this year.
The most powerful part of these initiatives is that 1600 tones of plastic dense bear ear will never return door restaurants.
Do not hesitate to reach out to our IR team.
Or visit our website for more details on our Earth It doesn't for daughter.
I will conclude with slide 15.
On some very preliminary thoughts on next year.
With what we know today, we expect consumers to remain cautious when eating out.
They will be concerned about their health and safety Awesome results, let me mention and.
We also expect them to be financially constrained.
As a result of the Pandemics impact on wages on unemployment.
This is why our leadership in the digital space will be so important to us.
Ensure that we are attracting our guests with compelling personalized video offerings as we continue the journey from mass marketing to must personalization.
It is too early to provide a specific number for new restaurants.
But we have a robust pipeline of locations already under development.
Support our restaurant opening a modernization plans for next year.
Which will focus on freestanding locations.
We also believe that every competitor said.
Combined with the best restaurant footprint in the region, we generate significant opportunities for organic growth.
We fully expect to consolidate the market share gains we have made this year as well as benefit from the shift to more drive through on delivery volumes.
Once we conclude our planning process in the next several weeks, we will have more BC really be on what to expect next year.
Based on that we plan to provide you with a more formal outlook prior to our next earnings call.
Operator, please open the call to questions.
[noise], ladies and gentlemen at this time well begin the question and answer session.
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At this time, we will pause momentarily to assemble the roster.
And our first question today comes from Ian Leukotac from JP Morgan. Please go ahead with your question.
Good morning myself and my down on then hope you and your friends are doing well.
Because a couple of questions. If I may to start here it will be interesting to get a glance on hall sensor sales is performing their October and November by region. If possible also on sales always in dining performing throughout all regions given the lor restrictions I went and all seen.
And on the margin side I think it was a pleasant surprise to see margins in Brazil in Caribbean at or close to 11%, but when we look at 2021, we see likely higher Cogs less financial aid from the government and likely lower disposable income. So my questions are to what to expect for next year and what initiatives are you.
Were working with to cope with these headwinds.
And last if I may also sorry for the for the long questions here how has evolved your your talks with Mcdonald's in regards to your expansion expansion plan. So any update on timing and size. Thank you.
Okay. Good morning in Oh, we tried to cover as much of your question I suppose he was on obviously Medina will help me with with that so let's start with we the first part of the same store sales.
Let me say that we are very pleased with the improving trends of comparable sales in the recent months I'm, particularly in the recent weeks or.
As we mentioned in our opening remarks October comparable sales rose.
Rose to more than 90% of the prior year period. So that's the sequential improvement when compared with the launch last month of the third quarter.
And in terms of the different regions I I would tell you that they got even division continued to lead the way.
I'm, particularly in October we generated in the Caribbean Division doubled the sheep positive comps. So very strong result on a very contribute a very important contributor to our results given the fact that the US as you know there are we have many markets that produce results in how to currencies.
Which are very important for the company. The other divisions also continue generating a sequential improvements last month.
We are very excited with the November figures Nov continues to see improving trends.
We are pleased with the performance of each division each of them in a different context in terms of the operating conditions on government restriction, but I would say that a good news coming from the sales part of the business in terms of on premise dining a I would say that.
The main challenges remain in the most.
Even though many modes reopen we are still our freight we are still facing some restrictions in terms of hours of operations. He malls. So yeah.
Obviously, the recent recovery in you don't bring me sales in all the restaurants that are allowed to operate.
Their dining rooms, but particularly in shopping malls, we are facing some challenges additional challenges given the fact that I mention.
There are still some restrictions, particularly.
Hello, there are still closed.
<unk> courts in differential be most on there are restrictions in terms of hours of operations.
I will talk a little bit about a 2021 on.
As I mentioned during the call.
We do not have all the answers yet, but we are advancing in our 2020 one planning process.
As we mentioned we expect to provide you with some visibility on what we plan ahead.
For Delaware before our next earnings call.
This is all used to New York has been obviously a unique period in Q3. So we are focused on our plans for Twentytwenty one we.
We do so so how we are managing the planning process with Mcdonald's in other words for now we are minor as you know we're opening sunrise meant the Reinvestments plan.
On a year by year basis as we look ahead, we have a robust pipeline of openings that will support our future. We're almost in line with market conditions. So I expect in the coming weeks and months due to go back to you and the rest of you.
I'll give some color in terms of what to expect in Twentytwenty, one on conversations with Mcdonalds, our constant and I think that we are pretty aligned in terms of the opportunities that we see <unk>.
For the brand in the different markets and we are very enthusiastic building on the strengths and their market share wins that we already had this year.
In terms of machines on China. She is for four Twentytwenty one obviously.
There are a lot of challenges, but I think that we are very pleased with the way we are managing the business right now and the way that we are keeping our margins growing a month after month four quarters. After after quarter Schuff as an example.
Maybe the the main area of course, you know were be unhelpful on paper. If you take a look to our food and paper a set percentage of revenue in the third quarter you'd improved by 30 basis points on is basically flat for the whole year for the first nine months of the year Despite food.
Inflation about CB eight you many of our markets, particularly in Brazil as you know there are some pressure.
Coming from protein costs protein cost pressures are a reality that the entire for the industry is facing so not just us not just you aside or restaurants in general, but also groceries, but.
But in that kind of scenario.
Given our scale.
Our ability and skews of negotiation.
I'm convinced that we are in a much better position than any one else no.
Markets to deal with these kind of pressures on we have in place or if we'll start to see theme at the corporate level and we have many management teams are the market levels that are focused more than ever are.
In in managing the demand you will do we said how we sell it.
Our our menu or product on improving our gross.
Gross margin on and they are working all the levers related with what was modest in its not only cost you said about prices is about promotions is about labor machine, our DC, though <unk> capabilities to offer a segment that offer on different offers for these different customers. So we will work hard to do.
Manage this effectively 2020 one through a combination of pricing mix event that amount aspirin supplier negotiations et cetera. So I think we were already in a very good position to continue building on the strengths. We have this year on improving margins are in the coming.
Once.
I think that I go over most of it I don't know if there's something missed but.
But thanks for the question.
Our next question comes from Marcella Ritchie <unk> from Credit Suisse. Please go ahead with your question.
Hi, My fellow Medina, Dan. Thank you for taking my question I have a quick one just this Monday Mcdonalds Corporation hosted its Investor day in the over 18 of the event was accelerated investments to drive growth. So just would like to hear from you or what the so called.
I'll, let accelerating the arch is traffic from the company could mean for our costs going forward. Thank you.
Yeah. Thanks for the question modest Oh, I would say that obviously ER there are opportunities for for the Mcdonalds brand in different areas. So theyre all in different regions are we are seeing those kind of opportunities you know a region, but as I mentioned before we.
Still do not have all the all the.
The details on on our plan for next year I would tell you that.
We continue to see opportunities in improving our restaurant portfolio base.
We have a very strong a competitive advantage you know what footprint. It was pretty clear this year and how important is our base of freestanding units across the region and we were US as you may recall, we were in the process of converting or modernizing many of those restaurants.
Do they yield the F. concept I think that you will continue to see some of those kind of investments going forward leveraging again, all the learnings on all the success that we had during this year and in terms of new units, we will have some.
Additional news some more details in the coming weeks, but we do see opportunities for the brand.
In different markets or part of their announcements that the Mcdonald's team made.
This week on Monday was around the different formats restaurant formats that they were.
Are they gonna look so for example, they talk about Ics or Madonna us when they go restaurants, which are or are supposed to be restaurants that we have very small or no line in rooms, and we refocused on operating delivery and drive through so we will be monitoring the performance.
Of these new concepts to their mine, which ones are appropriate for our region on an as always leverage all the research and development that the mcdonalds system. Thus in other areas of the world. So we.
We will take a close look do that in order to see what we can learn on unlevered cash.
In in this area. So in ways, we are very aligned with Mcdonald's it strategy globally in general.
Okay. Thank you so much.
You're very welcome.
Our next question comes from Robert Ford from Bank of America. Please go with your question.
Hey, good morning, everybody and thanks for taking my question [laughter] Marcello <unk>. What are you seeing in terms of a mom and pop and it's marching bankruptcy across your major markets.
And how big of a market share opportunity do you anticipate.
Okay, Hi, Bob and Matt Nice to have you in the call.
Yes after the different.
Periods in the different markets or shut shut down or flat.
No seen periods, Oh, I see a consequence of the restrictions imposed by government. We saw many mom and pops on small chain a restaurant that be then reopened.
It varies from market to market from city to city, but.
Definitely there are some players less players in the market. So.
That's that's a reality on I need a gross across the region up in that scenario on I'm basing our figures for Q2 and Q3 are us as you know we measure on drug market, you're using a variety of sources.
We tried to triangulate to identify trends and areas of opportunity that that includes on research third party sources comparative growth rates on all of these sources indicate that we have been gaining market share big time across the region.
ER. So a we are growing either faster or at the expense of our direct competitors and or other restaurant formats on on typically those formats that you mention dining mom and pop or small chains and restaurants are the ones that suffered the most.
So.
We gained a lot of share and we have a very strong plan.
Basically around our three these dishy the delivery and drive through in order to keep those gains going forward.
And we are very up to me optimistic in that sense. So.
We are in a pretty good.
Position to to keep this leadership growing going forward.
In Barcelona in your earlier comments you also mentioned.
Right.
I would say fees, it's been I think a big differentiator for a long time, but now.
Corporate risk and transmission risk you know, it's it's it's a.
She'd been greater right do you have a sense of how important that safety consideration is and how it ranks versus.
Other factors like price, where experience or speed and in a market like Brazil.
Yeah, well, yeah, absolutely it continues to be there.
The first.
Or between the first two body above the customer if they get an account at the moment of deciding what to eat out of home. So it continues to be.
A huge barrier already for our customers and that's why our market at the heels sort of muck safe program was so important are the very beginning but what we saw after all this month of Oh.
Leading with the pandemic in the region is that many of the improvements. We these in terms of safety and all the recognition we got from all these efforts translate into other areas. So the brand to other attributes of the run I would say that all the attributes.
We measure you know where own research, which is the same that Madonna thus around the world.
All the attributes improve.
Board that after quarter month after month in almost all the markets and I think that.
How seriously we took a demand for the hills Remoxy program or the recognition we received from our customers from our employees, which is very.
Very important from.
Government authorities, all that kind of feedback we received from these stakeholders translated to the whole community and that's why the Brown Trust a.
Results that we had we are having in recent months, but at the highest level in many many years and I think that hygiene on food safety costs, a lot of a lot to do with that that's why for US we continue to be a priority. The execution of these macro the hugo somewhat safe or make safe program because.
It is very important and we understand that it will continue to be very important for the customers in their decision making.
ER or of where where they had their means out of home.
Oh, that's that's great to hear could for you. Thank you.
Thank you Bob.
And ladies and gentlemen, I'm showing no further questions I would now like to turn the conference call back over for any closing remarks.
Okay. Thank you. Thank you very much on thank you everyone for joining our call today and for your questions I wish you all a happy holiday season.
I look forward to speaking with you again once we can provide you with more details on our plans for Twentytwenty. One. So please stay if it stay safe uncovered a great day.
Ladies and gentlemen, with that well conclude todays conference call. We do thank you for attending.
You may now disconnect your line.
Yeah.