Q2 2023 Transcontinental Inc Earnings Call
Speaker 1: And to to.
Speaker 2: Thank you for your patience and welcome to the telephonic conference which DIY
Speaker 2: During the conference, all participants will be invited to the stage. A question from the audience will be asked at the moment.
Speaker 2: We will now repeat this conference and will begin today, June 7, 2013.
Speaker 2: Welcome to the TC Transcontinental 2nd Quarter of FISCCOL 2023 Results Conference Call.
Speaker 2: During the presentation, all participants will be in a listen-only mode.
Speaker 2: Afterwards, we will conduct the question and answer session and instructions will be provided at that time. As a reminder, this conference is being recorded today, June 7, 2023. I would now like to turn the conference over to Yann Lapointe, Director, Investor Relations and Treasury. I would now like to turn the conference over to Yann Lapointe, Director, Investor Relations and Treasury.
Speaker 2: The director is in relation with the investors and is very sorry. Mr. Lapointe, please go ahead.
Speaker 3: Thank you, Julie, and good afternoon, everyone.
Speaker 3: Welcome to Transcontinental's second quarter of fiscal 2023 earnings call.
Speaker 3: Before we begin, please note that the press release, the NDMA, along with complete financial statements and related notes, as well as the slides supporting management's remarks, are all available on our website at www.tc.tc under the investor relations section.
Speaker 3: A replay of this conference call will also be available on our website shortly after the call.
Speaker 3: Please note that this conference call is intended for the financial community. Media are in listen-only mode and should contact Napoli St. Jean, Senior Advisor, Corporate Communications for more information.
Speaker 3: Some of the financial measures discussed over the course of this conference call are non-IFRS. You can refer to the MDNA for a complete definition and reconciliation of these measures to IFRS. In addition, this conference call might also contain forward-looking statements.
Speaker 3: These statements are based on the current expectations of management and information available as of today and they involve numerous risks and uncertainties known and unknown.
Speaker 3: The risks, uncertainties, and other factors that could influence actual results are described in the fiscal 2022 Annual MBNA and in the Annual Information Form.
Speaker 3: We have with us today our newly appointed President and Chief Executive Officer, Thomas Mamoure, and our Executive Vice President and Chief Financial Officer, Danal Lekevili.
Speaker 3: Before I turn the call over to Thomas and Danal, I would like to invite our Executive Chair of the Board Isabelle Marcoux to say a few words about the executive changes announced earlier today.
Speaker 4: Thank you, Jan, and good afternoon. I am pleased to join this call today to introduce Tamar Moheim, our newly appointed President and CEO .
Speaker 4: When Tamar joined our organization four years ago, we had a significant challenge in front of us. After many small acquisitions and a major acquisition of Covaris, our packaging sector had reached a critical mass. Packaging needed an experienced leader to consolidate our platform, generate profitable growth...
Speaker 4: and develop a strong leadership team.
Speaker 4: Ultima is delivered on all fronts in a complex and challenging environment, including the pandemic.
Speaker 4: As our focus turns to generating sustained organic growth, optimizing the return on our assets, leveraging our balance sheet, all the while pursuing our sustainability agenda, the Board has decided to appoint someone to lead Transcontinental.
Speaker 4: We are confident that Tamar has the experience and ability to deliver at least four priorities with a team that is second to none. We are confident that he can and will lead the organization through its next chapter for the benefit of all of its stakeholders.
Speaker 4: I know that Tamar will do so while upholding the values and culture that distinguish transcontinental.
Speaker 4: You can read Tamal's resume in our press release issued earlier today, but let me make a few comments on the leader he is.
Speaker 4: Some off-fabers dialogue, collegiality and diversity. He believes in the power of teens.
Speaker 4: He's both a strong operator and a people person.
Speaker 4: He has built strong relationships with our customers and leaders of our organization.
Speaker 4: The Maha's led what I believe is the best part entity in our industry.
Speaker 4: is focused on ensuring that our investments will generate returns and that our efforts are directed at what our customers need and want.
Speaker 4: We're already seeing the early results of our sustainable journey flexible with some innovative recyclable structures and exciting new products.
Speaker 4: Finally, Sema is all about results. With five consecutive quarters of profit growth in this sector, the packaging sector, Sema delivered on that front.
Speaker 4: I also want to congratulate Nana LeKavalyi, who has been promoted to Executive Vice President of CFO .
Speaker 4: Over his 17 years with the company, Danal has become a trusted advisor for the leadership team, for me and for the board. I know that we are in safe hands with Danal.
Speaker 4: As for myself, I was appointed by the Board to the position of Executive Chair. As such, I will assume the responsibility for strategy and corporate development in our media sector.
Speaker 4: This will allow Tamar, Danal, and the team to focus on our four priorities.
Speaker 4: On behalf of the Board of Directors, I want to thank Peter Bruce for his contribution first as a board member and then as president and CEO . He has helped our leaders grow and close important deals. I wish him the best for the future.
Speaker 4: In conclusion, we now have a leaner and more focused team strongly determined to succeed.
Speaker 4: I look forward to working with the members of our board in Wetoma, Danaz and our teams in creating value for all of our stakeholders.
Speaker 4: working with the members of our board and with some of the NALs and our teams in creating value for all of our stakeholders. Thank you and back to you, Jan. stand
Speaker 3: Thank you Isabel. I will now turn the call over to Thomas. Thank you Yan and thank you Isabel for these kind words. He is of course with a great deal of enthusiasm that I take on my new role today. First I would like to thank you Isabel and the Marcoux family including our founder Remy, as well as the board of directors for the trust they placed in me.
Speaker 3: I would like to echo what Isabelle just said about TC's unique culture.
Speaker 3: Since I joined TC Transcontinental four years ago, I've been very much impressed by the quality and the potential of our tenants, a strong culture and its entrepreneurial spirit.
Speaker 3: With a company's strong and experienced executive team, with whom I have had the privilege to work with, we will continue to implement profitable and sustainable growth plans in all three sectors.
Speaker 3: We will focus, as you said, a bit on the four priorities, which are organic growth, and
Speaker 3: optimizing the return on our assets, reduce our debt, and at the same time commercializing our sustainability products and agenda.
Speaker 3: Before I pass it on to Donald, let me briefly comment on our Q2 results.
Speaker 3: I will of course have more to say at the next quarter result, this is my first day in the job, but we'll go and see what are the highlights of the quarter. Overall, despite lower volumes, our second quarter are pretty solid. After the difficult first one,
Speaker 3: The teams took quick and decisive actions to improve financial performance.
Speaker 3: and decisive actions to improve a financial performance. I'll start with packaging.
Speaker 3: So in packaging I'm proud of our profit improvement and as you said these are very...
Speaker 3: quarter in a row and it's not happening by chance. A lot of actions have been taken since the beginning of this year and leading to these results. I will make it two buckets. First, commercially we continue to engage with customers in finding ways to mitigate the impact of inflation.
Speaker 3: Second, operationally, we took cost out to adjust to some volume contraction, primarily related to inventory management by our customers.
Speaker 3: At the same time, we did the same within TC. We are improving on binary levels as well, having a positive impact on cash.
Speaker 3: Looking ahead, our recent investments will continue to stimulate and stimulate our growth, and we are starting to recover as well in our agriculture segment. Moving to print. In the printing sector, we were obviously proactive with an even greater deal of speed in adjusting our costs.
Speaker 3: and mitigate the impact of inflation as well. With these actions, we were successful in partially offsetting the effect of lower volume in flyers and distribution activities.
Speaker 3: In terms of innovation, I want to congratulate the team for the launch of radar in Montreal, a significant evolution in printed flyers which strengthens our cost position and at the same time improve the environmental footprint. This is promising.
Speaker 3: In closing, I also want to congratulate you, Donald, for your expanded role. I appreciate your knowledge of the sound judgment and your business sense.
Speaker 3: We will build over our four years of collaboration and do even more so by working even more closely in annual roles. And as we share, along with Isabelle, the same common desire to better the future.
Speaker 3: to better for the benefit of our old stakeholders.
Speaker 3: Last but not least, I'd like to express my gratitude to Peter Bruce and I would not be here today without his guidance and support all along the years I worked with him.
Speaker 3: And for you all on this call, follow OTC. I look forward to meeting you and build a fruitful relationship. And with that, I will pass it over to you Donald.
Speaker 3: Thank you, Isabelle, for your introduction and congratulations to Ma for this well-deserved appointment.
Speaker 3: Moving to consolidated numbers on slide 5 of the earnings call presentation, for the second quarter of 2023, we reported a 4.4% increase in revenues versus the same period last year. This growth was mainly driven by the impact of exchange rates and also benefited from my position.
Speaker 3: in our packaging and media sectors. Organic growth stood at.8 million as pass-through of higher costs was upset by lower volumes.
Speaker 3: Regarding profitability, consolidated adjusted beta for a quarter was $109 million, up 5.2% compared to Q2 last year.
Speaker 3: This increase was mainly due to a strong performance in packaging, which delivered 15 million adjusted EBITDA growth in a quarter. I will come back to the sector results in a minute.
Speaker 3: Financial expenses increased to $15.2 million, mainly from the impact of higher interest rates on our variable debt. Adjusted income tax of $11.9 million was in line with last year's and represented an effective tax rate of 23.3%.
Speaker 3: This resulted in adjusted net earnings of 45 cents per share for the quarter.
Speaker 3: Now moving to slide 6 for the sector review. In packaging, we generated a revenue of $444.2 million. Similar to last quarter, the increase of 5.4% versus last year was mainly due to the positive movement and exchange rate.
Speaker 3: Positive impact of the increase in price to medicate for inflation was more than offset by decrease in volume mainly due to customer destocking.
Speaker 3: In terms of profitability, adjusted eBidline packaging was up 28.6%.
Speaker 3: Excluding the impact of exchange rates adjusted EBITDA grew organically by 18.5%.
Speaker 3: This organic growth was mainly due to improved profit from inflationary cost recovery and also benefited from a favorable mix.
Speaker 3: With the exception of our Latin American operations, all our segments posted and proved adjusted to be in the corner.
Speaker 3: The strong performance is a record for its sector with an adjusted bid of $67.4 million for the quarter.
Speaker 3: That being said, we don't expect to repeat this every quarter going forward, giving the favorable mix this quarter and continued customer de-stocking expected in the second half of the year.
Speaker 3: Moving to printing on slide 7, revenues increased by 2.3%. This growth resulted from the pass-through of inflationary price increases and higher revenues from our in-store marketing activities.
Speaker 3: partially offset by lower volumes in retail flyer printing and distribution activities.
Speaker 3: Rentings adjusted a bit though was $50 million for the quarter compared to $54.7 million last year.
Speaker 3: This $4.7 million decrease is a strong improvement compared to $16.2 million decrease we saw in the first quarter. For more information, visit www.fema.gov
Speaker 3: The work by the printing sector to implement cost reduction measures helped to mitigate the impacts of lower over-year volumes.
Speaker 3: These actions, combined with improved performance from the ISAM segment, contributed to reduce the gap versus last year's EBITDA.
Speaker 3: As we expect volumes to remain under pressure, we will continue to be disciplined on our costs.
Speaker 3: Corporate expense were higher than last year due mainly to higher stock-based compensation costs.
Speaker 3: Now turning to cash flow. We generated $105 million from operating activities, an increase of $30.6 million dollars versus last year, mainly to improve working capital.
Speaker 3: This is also the first quarter of positive working capital since fiscal year 2020 and we are confident in our ability to further improve in the second half of the year. Our investments in CapEx at $53.2 million are higher than last year but in line with Q1. We are confident in our ability to further improve in the second half of the year.
Speaker 3: We expect CapEx to reach about $160 million for the fiscal 2023 net potential disposal before returning to a lower run rate in fiscal 2024.
Speaker 3: While impacting our debt in the short term, our investments position us well for the future and should be a key driver of our long-term growth, especially as we see growing customers' demand for sustainable packaging.
Speaker 3: Despite a high level of capex, our net death ratio is improving, spending at 2.58 times at the end of the second quarter compared to 2.63 times three months ago.
Speaker 3: The improvement of the last three months is mainly due to higher cash flow generation from positive working capital and improved the business.
Speaker 3: Given our free cash flow generation, we expect the ratio to come down close to two times in the coming quarters.
Speaker 3: Closing, despite challenging operating conditions, we delivered a solid quarter that benefited from the actions we implemented to improve our financial performance. In terms of outlook, in packaging, while we expect pressures on volume to persist, we
Speaker 3: we continue to expect to improve profitability in fiscal 2023. In print, we continue to expect growth in our ISM and book printing activities.
Speaker 3: In terms of profitability, we expect lower adjusted EBITDA for fiscal year 2023 from the impact on inflation on volume and cost structure, partially offset by the impact on the ongoing cost reduction initiative.
Speaker 3: We expect corporate costs at the EBITDA level to be around $40 million for the year.
Speaker 3: Moreover, cash taxes should be at around $60 million. On that note, we will now proceed with the question period.
Speaker 2: Thank you, Madam Vice-M'Monsieur. We are now proceeding to the question and answer period. If you have any questions, you can call the touch at the end of the call. I'll send you to your telephone at the end. A phone call is being sent to confirm your request. The questions will be answered in the Q&A. We are now proceeding to the question and answer period.
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Speaker 2: Your questions will be pulled in the order they are received. Please ensure you have left the handset if you are using a speakerphone before pressing any keys. One moment please for your first question.
Speaker 2: Your first question comes from Adam Shine from National Bank Financial. Please go ahead.
Speaker 5: Thank you. Good afternoon. So congratulations to everyone for their promotions. It might be a little bit early, but to the extent that you can talk a little bit about how your strategy and maybe your vision in your new role may differ at all from your predecessor. And then I'll just follow up with a few more if you don't mind.
Speaker 3: Sure, I think we will focus on the four key priorities, some of which would be not so much different than what you would have heard earlier, Adam. The four key priorities really is to generate organic growth and profitable organic growth, I would add to that. The four key priorities really is to generate organic growth and profitable organic growth,
Speaker 3: So how to get there really is to continue to invest in the segments we know are growing using the tools we've developed along the last few months and years like the Commercial Excellence Initiative you're probably aware of and continue to leverage on the partnership with our key customers investing after them.
Speaker 3: you know it's an agricultural business so weather can help or may not help it's not helping this can explain some year-on-year variances. Now the important factor though is we pushed inflation recovery as well as raw materials recovery to this segment as well as we've done it to others.
Speaker 3: This led to some share of water loss. Let's be very clear. This is not something we're now recovering as we've exhausted our expensive invariants. This is where we've pushed the Invariant reduction the most and the fastest and now we can leverage on cheaper materials and recover those volumes again That's basically where we stand at.
Speaker 3: Now how fast are we going to recover that? I don't know yet. Okay, peace talking. Peace talking, yeah I was going to that. Peace talking, the same thing as what we've experienced, longer supply chain times led our customers and ourselves to have higher...
Speaker 3: to continue towards Q3. The way we can anticipate is by having very close discussions with customers which we do and we have very very clear line of sight on the amount of volumes they plan to reduce in various so basically I think Q3 maybe beginning of Q4. Okay and just one last question for you it's obviously a good quarter in...
Speaker 3: I think we can take this question maybe in a different call because we're going to be very specific. All the sites we have in Canada have different market segment focus. Some are internally driven, some are externally. So if you don't mind, I'm totally happy to have this discussion with you maybe in a different
Speaker 5: Sure. No, happy to do that and I'll queue up again. Thanks.
Speaker 6: Thank you, Emma. Your next question comes from Amir Patel from CIBC Capital Markets. Please go ahead. Good afternoon and congratulations, Thomas and Donald, on your new roles. I just wanted to follow up on the de-stocking in packaging.
Speaker 6: Thomas, are you able to scale the volume decline that you might expect for the business this year in packaging? That's a good question. First, I'd like to add that despite the volume reduction or distocking, we are gaining share of wallet. So, as we speak, we are gaining share of wallet.
Speaker 3: We are growing with customers as a percentage of their demand. And the reason for that is the team has done an exceptional job during the pandemic to maintain a good service level to our customers. So this is talking in lower demand, if you will. We are continuing to gain shares. This also supports the investments we're making. Now, your question is about the amount of...
Speaker 3: To give you maybe more color, we're close to being flat on the first quarter and this quarter we're close to minus 4%.
Speaker 3: Is the trend continue it's hard to say but for sure we see as Thomas mentioned 2-3 will be what we see a same tendency for Q3
Speaker 6: Okay, great. Thanks. That's helpful. And just sticking with packaging, Thomas, can you speak to some of the sustainable packaging innovations that you expect to bring to market over the coming year and how that could drive further share gains?
Speaker 3: Thank you very much for this question. First, the agenda is pretty full and the speed of execution is high. We've seen in the course of Q1 and accelerating in Q2 a stronger demand and momentum in our customers' agenda when it comes to sustainable packaging.
Speaker 3: and we have a lot of products which are now ready to be launched and some are already commercial as we speak actually. So the way we look at it is to measure the amount of recycle ready products we commercialize as well as the PCR volumes we integrate in our packaging.
Speaker 3: So that it's clear our PCR assets are not full. So we're buying PCR on the market because of the success of these products. And we are ramping up very, very quickly our mono-material recycle ready.
Speaker 6: packaging with our key core partners in packaging. So strong dynamic and we're ready. Okay great. And just the last question I had there was, Thomas are you able to kind of comment on how the margins of the sustainable packaging products that you bring to market would compare with the base business?
Speaker 6: core partners in packaging. So strong dynamic and we're ready. Okay great, and just the last question I had there was, so I was able to kind of comment on how the margins of the sustainable packaging products that you bring to market would compare with the base business.
Speaker 3: Good question as well and we can also go deeper in the analysis. It obviously depends on the type of product we commercialize. In some cases we do have an expanded margin because of the PCR content for instance this is helping us having a good control on some of the costs.
Speaker 3: This can vary for the moment it is the case. For the rest it's a bit too early to say. We have a commercial plan, a marketing plan so that we know the level of margin we're targeting which is an enhanced level of margin. I'm going to tell you how fast we can...
Speaker 6: measure this or report on that. We will obviously and it's definitely in line with our strategy. Okay great thanks that's all I had I'll turn it over. Your next question comes from Sid De La Vare from Car-Mark please go ahead. Okay guys thanks for taking my question and turn us on.
Speaker 3: Well, yes, actually...
Speaker 3: We saw a decrease in the second quarter regarding the tonnage, but it was less than Q1, but still was a decrease, an important decrease. When we already took initiative on that side, you may recall that when we announced our numbers in Q1, that we had put a program in place for cost reduction initiative. This has helped us actually in the second quarter. That's one of the key reasons why we have to do this.
Speaker 3: we have a delta between the minus 16 million in Q1 and minus 4 million. So volume was affected a little bit less than Q1, but definitely we had a good cost program, cost initiative program that helped us. And the team is still working and we will adjust, you know, accordingly to the demand by clients, so we're very proactive on that side.
Speaker 6: Sorry, so for the second half of the year, do you see volumes sort of stabilizing a little bit or still being down? Well, you know, it's hard to comment on the second half of the year, but for sure we saw some decrease last year in the second half of the fiscal 2022. This is why actually Q1 was a tough come for us when we announced our public numbers last quarter.
Speaker 3: So we saw some decrease. So it depends on where the fall season will end up. But last year the fall season was below our expectation. This is why we adjust our costs in the early 2023. But for the moment, you know, we...
Speaker 3: we will certainly adjust our cost structure. So it's hard to say regarding how deep it will go, but we will act accordingly.
Speaker 6: Right, okay. That's very helpful. And then just a higher level question, just on your capital allocation priorities for the year, given the current great environment, we obviously saw a spike in interest rate expense during the quarter. How do you think about your balance sheet debt here or acquisitions or share buybacks at this point? Share buyback is out of our strategy as we speak.
Speaker 3: You know, we still the rest of fiscal 2023, the main objective is to decrease the debt. We want, as I said in my remarks, we want to get closer to the next quarters, that to a better ratio. So for sure, it will be paid on debt, we will produce a lot of free cash flow in the second half. That will be put on our desk for sure.
Speaker 2: Okay, all right, thanks. I'll pass it on. Your next question comes from Steven McCloud from DMO Capital Market. Please go ahead.
Speaker 7: Thank you. Good evening. And I just want to reiterate congratulations to everyone's revised and new appointments.
Speaker 7: I just wanted to ask a couple questions, one on packaging, one on printing.
Speaker 7: Maybe starting with packaging, you know lots of puts and takes and I know resin prices playing a factor but it's very strong very strong margins in the packaging business and in Q2 and I'm just wondering how you expect the margin profile to evolve as you sort of move through the year and then
Speaker 7: looking out beyond 2023, how do you view a progression sort of back towards that 16%?
Speaker 3: Yeah, you keep on raising the number. So thank you for asking this question. The resin has gone down, but not that much if you take a good look at it. It's been going down, but then went up slightly.
Speaker 3: since the beginning of the year. So the year-on-year movement is not that big, not significant I would say to you. What is significant is obviously the recovery compared to last year on inflation and no material passed through. That's for sure making a difference. Not so much the raising of the regime.
Speaker 3: Now your question is about where should be lending a percent, a margin percentage. I think it's going to be around the 14% if I may say so in the remainder of the year. We'll see we are in the 15% this quarter of 2016.
Speaker 3: What really matters is the longer view and the mix improvement and the play we're having on the various segments I mentioned. So our agenda is to grow where we're making more margin, if you will, as opposed to trying to squeeze margin and have low margin products. That's really what we intend to do strategically.
Speaker 3: And that's why I'm confident we will indeed reach this 16% mark, but not so much on a one quarter basis, but more in a sustainable manner when we progress towards the healthier product mix. We have tools for that.
Speaker 3: We have commercial excellence we've been launching about a year ago. Excellent progress here we've almost finished the rollout of this tool within within packaging and we're starting to do it within the print segments as well. So with this we have a
Speaker 7: if you were forward-looking we know where to go so that we improve our mix. Okay that's a that's helpful color thank you Thomas. And then maybe just looking at the printing segment you know you've had you had you sort of turned organic cells growth from
Speaker 7: negative in Q4, Q1 to positive in Q2. I'm just wondering if there's some sort of inflection point that's being driven by, or is it maybe more mixed related and isolated to the quarter? As we said at the end of the first quarter, we said that obviously we had the impact, like I said earlier, of the flyer business and...
Speaker 3: distribution like we had in the second quarter, but what came out on the first quarter is that the ISM business came below our expectation that was
Speaker 3: That explains almost 50% of the decrease of the margin in that quarter and in this quarter they turn around not they turn around But it's more what we expect from that business. So and that business this is why we're investing. It's a growing business We think we can gain market share and we keep we're certainly keeping that we can be more efficient and increase them
Speaker 8: also very good for us in this quarter.
Speaker 7: Okay, that's great. Thank you. Thank you very much.
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Speaker 2: If you have any additional questions, please press the star followed by the one. As a reminder, if you are using a speakerphone, please leave the handset before pressing any keys.
Speaker 2: Your next question comes from Drew McReynolds from RBC. Please go ahead.
Speaker 6: Yeah thanks very much good afternoon and congrats Thomas and Donal. Two for me. First on the printing side I guess in May there was the transition with Public SAC and obviously nice to see radar out there and in the market wondering just as we kind of think about
Speaker 6: the financial impact here on that kind of transition just what you've seen or what you expect here in the quarter. And then secondly, Tomas, just for you it sounds as if there's maybe a little bit more emphasis on packaging margin. I know Peter put I think a lot of emphasis on packaging EBITDA and dollar amounts.
Speaker 3: I agree it's a great product. We're really proud of that new product that was put in the market and it comes from I know a lot of great work by by the team at print that's always worked to sum up with an amazing innovation So really proud of it. It's a promising start. So we We like what we see so far, but it's definitely too early to comment on the financial impact on the longer term
Speaker 3: And if you go back to our four key priorities, and one of our four is obviously to a deleverage of balance sheet. So this is done with dollars, not with percentage. So we did both.
Speaker 3: I think the percentage of the way I would look at it is a guidance. As I said, aiming at higher end margin level products.
Speaker 3: That being said, what matters is the absolute dollars that are left at the end of the day. So it's both, I would say to you. The percentages of guidance and the target of the public.
Speaker 6: Okay, that's great Thomas. So, maybe one final one for me, back to you, Danel. In terms of a normalized CapEx looking beyond fiscal 2023, roughly, how do you view what that normalized level is just because we've seen obviously...
Speaker 6: a build up over the last few years. Just wondering what kind of step down we should be modeling in. Thank you. Well, first the impact is here obviously when you look compared to previous year, most of our CapEx are in the packaging group and a large part of it is in US dollars. That has an effect for sure.
Speaker 8: Having said that, I will say that 160 that we might end up this year, certainly not the base. I think the region of 130 and we will adjust depending on project might be a more normal area for us. 120 and 130.
Speaker 9: Is that it? Is that good?
Speaker 9: Is that it? Is that good?
Speaker 2: That's great, perfect. In the simple level the question was mama Mr. Lapointe, there are no further
Speaker 2: Thank you everyone for joining us on the call today and we look forward to speaking to you soon. Ladies and gentlemen, this concludes the conference call for today.
Speaker 1: Thank you for participating. Please disconnect your lines.