Q3 2024 Anaergia Inc Earnings Call
[music].
Hello, everyone and welcome to today's Algeria, Q3, 'twenty 'twenty four conference call and webcast. My name is Jay and I'll be the moderator for today's call.
After today's prepared remarks, there will be a Q&A session if you'd like to register a question. Please press star followed by one on your telephone keypad. If you wish to withdraw your question than it is star followed by two.
Speaker Change: It's now my pleasure to hand over to Darlene Abbotts Investor Relations at <unk>. Your line is now open. Please go ahead.
Darlene Abbotts: Thank you very much operator and good.
Speaker Change: Everyone.
Speaker Change: On this call we'll be discussing our earnings for energy third quarter 2024 ended September 32024.
Speaker Change: If you're following along with our slides in my comments are directed to the slides one through three.
Speaker Change: On slide two you'll see that for our call today I'm joined by Mr. Tsakos Energy as Chief Executive Officer.
Mr. Greg walks out of juice Chief Financial Officer.
Speaker Change: And Dr <unk> <unk> Chief operating officer.
Speaker Change: Before formal beginning our formal remarks, we would like to refer listeners to slide three of the presentation, which contains the caution on forward looking information and a note on the use of non <unk> measures.
Speaker Change: Listeners are reminded that today's discussion may contain forward looking statements that reflect current views with respect to future events.
Speaker Change: Any such statements are subject to risks and uncertainties that could cause actual results to differ materially from those anticipated in these forward looking statements.
Speaker Change: Energy does not undertake to update any forward looking statements, except as may be required by applicable laws.
Speaker Change: Listeners are urged to review the full discussion of risk factors in the company's prospectus, which was filed with Canadian securities regulators.
Speaker Change: And with that I'll turn.
Speaker Change: Turn the call over to us off.
Speaker Change: Thank you Charlie good morning, everyone.
Speaker Change: The slides for us.
Speaker Change: I'm honored to lead <unk> through what I would like to call to.
Speaker Change: Viewpoint.
Speaker Change: We have made strategic update to our leadership team.
Speaker Change: We recently welcomed three new board members, our new German or others.
Speaker Change: <unk> and myself.
Speaker Change: I'm also honored to have been appointed as the new GSE role. He's my dedicated team will drive our vision forward.
Speaker Change: <unk> has joined as our CFO is joining as our new General counsel.
Speaker Change: These changes are bringing fresh perspectives, we will guide to <unk>.
Speaker Change: Our growth our organization, we are shifting to a refined approach in sales and project development.
Speaker Change: We are expanding our global presence and identified a strong pipeline of new.
Speaker Change: Opportunities.
Speaker Change: These changes are establishing a foundation for sustainable long term growth and positioning in India.
Speaker Change: Leader in the renewable energy solution.
Speaker Change: Moving on to slide five.
Speaker Change: Our capital sales pipeline is gaining strength with the recent deal activity, which we believe will financially benefit the company in both near and long term.
Speaker Change: We are also advanced.
Speaker Change: We'll build on operate model through recent lease agreements, which can be positioned which can position us to extend the two facilities to support our financial partners.
So all of this capital light model, we will take on a minority equity position build the facility with our with our engineering products and establish long term operation and maintenance and maintenance costs.
Speaker Change: Alongside this development.
Speaker Change: We are growing our presence in key international market. For example, our recent announcement of our Japan office.
Speaker Change: We are demanding strategic investment, we have strengthened our foundation, allowing us to drive shareholder value.
Speaker Change: <unk> the company and focus on our core capabilities.
Speaker Change: This partnership supports our strategy of pursuing profitable projects that align with our vision of becoming the world's leading renewable fuel producer.
I would like to introduce all of you Mr. Greg Wolf our CFO.
Greg Wolf: To go over the financial highlights for the quarter.
Speaker Change: Greg.
Greg Wolf: Thank you.
Speaker Change: As we review our financial performance for the quarter. Our results are starting to reflect the impact of our strategic shift towards a capital light model, which is already yielding significant operational and financial efficiencies.
Adjusted EBITDA has improved 42% from.
Speaker Change: From a $11 1 million to just $6 4 million this quarter.
Speaker Change: A significant improvement in just a short span this quarter under new leadership. This progress underscores the effectiveness of our transition strategy achieving these improved results within the quarter speaks to the strong alignment of our operational priorities with our financial goals.
Loss from operations also improved we saw a year over year reduction in net loss.
Speaker Change: Substantial reduction in our loss.
Speaker Change: An early this is an early indication that our focus on cost efficiency and streamline operations is starting to deliver results. This improved improvement demonstrates our commitment to building a leaner more focused operational structure that supports profitability.
Speaker Change: Yes.
Speaker Change: Our net loss.
Speaker Change: Has decreased the significant significantly compared to previous years. This improvement reflects some initial benefit to our capital light structure, which is allowing us to optimize our financial resources and continue to pursue higher margin opportunities as we move forward.
Speaker Change: Our cash position has increased to $40 2 million, primarily attributable to the strategic investment from Marlin, which has provided a stronger financial base for our ongoing initiatives.
Speaker Change: In terms of key milestones this quarter, we've achieved several important steps.
Speaker Change: That support our strategic goals and financial stability first the <unk>.
Speaker Change: Investment on July 10th was closed for the third tranche from the equity investment.
Speaker Change: This strengthens our cash position and provided valuable capital for growth initiatives, we did a share restructuring simplification at our annual and special meeting of shareholders. On July 29, we completed the conversion of our dual class share structure into a single share class.
Speaker Change: This change reflects our committed commitment to governance improvements and aligns shareholder interests.
Speaker Change: In addition to closing the March 3rd tranche of equity investment.
Extensively reviewed our pipeline of opportunities are long term future cash flow projections and our current strong cash position.
Speaker Change: Given this our senior management has determined that the conditions that have previously led to the doctor for gardening, we're getting the company's ability to continue as a going concern has now been mitigated.
These substantial milestones mark pivotal steps in reinforcing energy as financial stability streamlining our governance structure and ensuring a solid foundation for future growth.
Speaker Change: Together, they reflect our commitment to executing our strategic vision with a focus on long term resilience and alignment with shareholder interest move.
Speaker Change: Moving to slide seven.
Speaker Change: Q3, 2024 revenues decreased.
Speaker Change: From $34 million in Q3, 2000 $23 million to $29 million in Q3 2024.
Speaker Change: Yes.
Speaker Change: This slight decrease was primarily due to Italian capital sales projects being completed and an interim delay in new project sites.
Speaker Change: Yes.
Speaker Change: Gross margins remained steady year over year, reflecting the stability in our core operations that we can continue to implement our new capital light strategy.
Speaker Change: SG&A expenses for Q3, 2024 decreased 19, 2% compared to Q3 2023 and decreased 21, 6% year to date Q3, 2024 compared to year to date Q3, 2023 due to decreased transition transaction activity with the completion of the rvs.
<unk> and <unk> transaction in 2023, as well as reductions in overhead expenses and decreases in head count for Q3 2024 compared to Q3 2023.
Speaker Change: Adjusted.
Speaker Change: EBITDA as noted improved substantially by 42%.
Speaker Change: $6 4 million in Q3 2024 from $11. One in Q3 2023, primarily due to improvements in SG&A period over period.
Speaker Change: Together these results single signaled the progress, we're making in transforming energy manager into a streamlined margin focused organization and a significantly short timeframe with new management.
Speaker Change: As we move forward our capital light model will remain central to our strategy, allowing us to concentrate on profitable growth and deliver sustainable value to our shareholders.
Now Doctor unique shearson will take us through our operational highlights.
Speaker Change: Thanks, very much Greg we're moving on to slide eight.
Speaker Change: I'll be providing an overview of our current projects Dieter enforcing our focus on financial discipline and our core capabilities in markets, where we have established expertise.
Speaker Change: First off the herbicide water control quality control plant upgrade we were awarded a $13 3 million Canadian contract with the city of Riverside to upgrade the water quality control plan, increasing its capacity to convert organic waste and wastewater sludge into renewable natural gas.
Speaker Change: This project aligns with California Senate, Bill 383 regulation to reduce methane emissions and support to emphasize environmental goals.
Speaker Change: Also announced was the Riverside.
Speaker Change: Counting organic waste processing facility.
Speaker Change: At the same facility, we're also developing an organic waste R&D facility.
Under a build own operate model this.
Speaker Change: This project is supported by Cal recycle and the city of member side and uses our proven model of retrofitting existing digester infrastructure to create sustainable energy from waste.
Speaker Change: Moving west in the World, We announced the <unk> Island, South Korea project under a letter of intent valued at approximately 25 million Canadian.
Speaker Change: We plan to design and build the <unk> bioenergy biogas plant, our waste to energy facility on Zhengzhou Island, converting organic waste into R&D. This project Eliza J J sustainability goals and strengthened our footprint in the global renewable energy market.
Transitioning to slide nine.
Speaker Change: Back to the U S. Michigan State University Digester upgrade we're expanding one of the largest on campus anaerobic digesters in North America, allowing it to process additional organic waste, including manure from Msu's, new dairy cattle teaching and research center.
Speaker Change: This facility will produce renewable energy for campus use and provide a practical learning platform demonstrating our commitment to innovation in partnership with leading institutions.
Speaker Change: The East Valley water districts. Another project announced we've extended our long term O&M contract with the East Valley Water district in Southern California, adding food waste processing and power generation services to the scope.
Speaker Change: This project uses our anaerobic digestion technology and showcases our experience in managing complex envoy waste energy operations.
Speaker Change: Moving to slide 10.
Speaker Change: With respect to the booth facilities, SOCAR Biomethane in California, and the Rhode Island Bioenergy facility in Rhode Island, our operating steadily injecting R&D into the pipeline with the Rhode Island facility continuing to ramp up our development pipeline also advances on projects in Riverside and Charlotte supporting our expansion goals.
Speaker Change: Focused growth in key markets continues our capital sales pipeline remains strong across.
Speaker Change: Across our three regions bolstered by incentives such as the U S inflation reduction Act IRA and Europe's Repower EU program. These market tailwind enable us to drive growth in regions, where we already have proven presence.
Speaker Change: In line with our growth, we opened a new office in Japan.
Speaker Change: To take advantage of the growing Asia Pacific region, Japan Basic energy plan targets, 5% carbon neutrality and city gas by 2030, and adapt Japan Association GAAP associations clean gas certification system supports renewable gas expansion.
Speaker Change: Our new office in Japan positions us to meet rising demand in the Asia Pacific region for waste to energy solutions, providing significant growth potential based off of an existing platform and base in the country.
New contracts in Africa.
Speaker Change: We've secured a new contract in Africa, highlighting our commitment to grow this developing market. This expansion strengthens our presence and supports our mission to deliver sustained wire solutions globally.
Speaker Change: And finally on a go forward basis, we're continuing to pursue our selective capital light growth.
Speaker Change: We're following a capital light strategy focused on markets, where we have an established presence and proven project success. This approach aligns with our strategic priorities leveraging our core competencies to support long term profitability.
Speaker Change: These projects and initiatives underscore our commitment to financial reset operational efficiency and targeted growth in familiar markets, where we can leverage our expertise.
Speaker Change: With that I'll pass the call back to <unk> for closing remarks.
Thank you very much indeed.
Speaker Change: We are now on slide 11.
Speaker Change: As we wrap up today's call I want to emphasize my excitement by the progress we have made in such limited timeframe.
Speaker Change: And the large opportunities that.
We are focusing on that disciplined growth where energy is.
Speaker Change: And if possible, becoming stronger and well positioned company to lead our rapidly expanding renewable energy sector.
Speaker Change: The global push for sustainable solution and carbon reduction is growing and we are right at the heart of this movement.
Speaker Change: With our unique technology.
Speaker Change: Utilized model.
Speaker Change: Total valuable financial partners, we are in the ideal position to capture market growth and deliver meaningful solutions.
Speaker Change: Large scale.
Speaker Change: Our deep commitment to technical innovation engineering operational excellence and financial discipline will drive positive momentum.
Speaker Change: As we look for 2025 and beyond.
Speaker Change: I am confident that <unk> will be at the forefront of the cleaner greener future.
Speaker Change: We're excited to continue building on these foundations create.
Speaker Change: Creating a value for our shareholders and making a real difference in the world.
Speaker Change: Thank you for your ongoing support and trusting Energia.
Speaker Change: Together, we are making the world.
Speaker Change: A better place.
Speaker Change: Ali.
Speaker Change: Thank you very much.
Speaker Change: I believe now we can open.
The call to questions operator.
Speaker Change: Thank you we will now start today's energy is Q&A session. If you would like to ask a question. Please press star followed by one on your telephone keypad. If you wish to withdraw. Your question then is followed by <unk>.
Speaker Change: Our first question today comes from Derrick Whitfield from Texas Capital Bank. Your line is now open. Please go ahead.
Derrick Whitfield: Good morning, all and thanks for your time.
Speaker Change: And in your prepared remarks, you have.
Speaker Change: Noted that your pipeline of commercial opportunities expected cash flow are mitigated previous going concern views.
Speaker Change: At a high level could you perhaps speak to how the pipeline has evolved over the last few quarters, and where you see the greatest opportunities for growth and your capital light model.
Speaker Change: Yes.
Speaker Change: I'll take that I'll take that.
Speaker Change: So I think we see okay. Yes go ahead.
Speaker Change: Okay.
Greg Wolf: No no please Greg.
Greg Wolf: Yes.
Speaker Change: The markets that we see and when we when we ran out of our cash flow and substantial detail on this.
Speaker Change: It's really in the U S.
Speaker Change: The European markets those two areas, we're seeing substantial opportunities that we believe we're going to capture.
Speaker Change: Over the next several months and years. So I think that both of those are probably the highlight areas plus we've expanded into the Asian market.
Speaker Change: Even more so than we already are those are <unk>.
Speaker Change: Developing but our real growth for the next year or so is really in North America and the European markets.
Speaker Change: Yeah.
Speaker Change: And perhaps more specifically on that outlook do you have the facilities in place to support a higher growth trajectory and if so when would you expect to turn to free cash flow positive.
Speaker Change: Yes.
Speaker Change: We don't we don't provide the guidance on that but we're looking at 2025.
Speaker Change: Okay.
Speaker Change: Substantially.
Speaker Change: Arent year for us as a company, but we don't provide the guidance on when that turns.
Speaker Change: We do see we do see that.
Speaker Change: The trend lines that we show in our in our model are very positive.
Speaker Change: Terrific and certainly I appreciate the color there.
Speaker Change: Finally for Yaniv.
The success of Rialto and SB 383 are very important to you.
Speaker Change: Could you perhaps speak to how the adoption of SB 383 is progressing.
Speaker Change: Yes, Derrick I mean, you hear all the guidance thanks for the question.
Speaker Change: Yes, yes, I'm here taking that.
Speaker Change: <unk> hundred 83 has been sluggish two two.
Speaker Change: To rollout and deploy but progress is being made.
Speaker Change: The team in California, with a lot of environmental policy, the slow out the gate, but doesn't turn back and Thats what were seeing on the ground. So as you know the Rialto facility did go through a sale process and is continuing to operate.
Speaker Change: And feedstock volumes continue to come to the site.
Speaker Change: And we're seeing in our other assets as well in southern California, the multiple assets that we do manage.
Speaker Change: Increasing volumes.
Speaker Change: Foodway, particularly from the growing commercial sector that has the most underserved.
Speaker Change: For compliance and so more.
Speaker Change: More corporate accounts are complying with.
Speaker Change: So our separated organic spin.
Speaker Change: And we're seeing in general volumes increasing across the state.
Speaker Change: Our cycle, so positive trends sluggish, but momentum is building.
Speaker Change: Terrific. Thanks again for your time.
As a reminder, if you would like to ask a question. Please press star followed by one on your telephone keypad.
Speaker Change: Our next question today comes from Craig Irwin from Roth Capital Partners. Your line is now Laythan. Please proceed.
Craig Irwin: Hi, good morning, Thanks for taking my questions.
Craig Irwin: First I would like to ask about capital sales.
Speaker Change: We all understand.
Speaker Change: <unk> gone through some.
Speaker Change: Some turbulence in the last year and.
Speaker Change: When I look at the.
Speaker Change: The capital sales line my number right, it's somewhere between $75 million to $80 million in revenue from capital sales this year.
Speaker Change: When we look at the last five years the average has been 113.
Speaker Change: Almost touched $140 million at couple of years ago in revenue there.
Speaker Change: Can you maybe talk about the opportunity to return to more normalized market activity on the capital sales side.
Speaker Change: Are there any impediments to assume improving activity in 2025.
Speaker Change: How would you compare.
The market right now versus the market over the last five years.
Speaker Change: Yes. This is <unk> I'll take that one.
Speaker Change: Youre right Theres been shifted with our capital sales. It is it is a fluctuating.
Speaker Change: Your line, but what we have seen.
Speaker Change: Steady growth is increasing demand for our integrated system solution sale.
Speaker Change: Where we add the greatest value is on engineered systems, where we're integrating.
Speaker Change: Turnkey packages to convert feedstock to fuel soup to nuts.
Speaker Change: And we're.
Speaker Change: And we're seeing quite quite strong tailwind, particularly in North America with the.
Speaker Change: That was a recent.
Speaker Change: Mentor program that.
It had some market delaying reaction, but we are certainly.
Speaker Change: A surge in demand and also an expansion to the municipal sector as well.
Speaker Change: As this credit program can benefit.
Speaker Change: Publicly owned agencies that do not pay taxes, they can still benefit from it.
Speaker Change: Under the under the regulation. So this is this has been a driving force in North America and in Europe, as well, we've seen strong tailwind with growing demand.
Speaker Change: We're increasing momentum out of out of our transformational year as you noted.
Speaker Change: So youll be seeing increasing.
Speaker Change: News about our refocused but.
Speaker Change: The quarter remember is.
Speaker Change: What has been core to our business has been.
Speaker Change: And as always.
Speaker Change: Dominated our capital sales business has always been a dominant source of our revenue.
Speaker Change: Between our product sales in our integrated solution system sale.
Speaker Change: Has been.
Speaker Change: Lion's share of our revenue contribution will continue to do so so we're seeing more and more push here.
Speaker Change: As more developers and municipalities getting the base to take advantage of these incentives now.
Speaker Change: Understood understood. So then that dovetails nicely with the second question, which is your services it looks like actually.
Speaker Change: Could have record revenue this year.
Speaker Change: The rapid that I had previously was last year at $18 4 million.
Speaker Change: Fingers crossed and it sounds like Youre getting.
Speaker Change: Benefits from the integrated sales that youre that youre describing now.
Can you maybe.
Speaker Change: Describe a little bit about the.
Speaker Change: The services model, how this is likely to evolve over the next year are you, making any substantial changes to the way you approach the market or price the business or the.
The overall offering in the business.
Speaker Change: Help us understand how this is this is going to unfold over the next few quarters.
Okay.
Speaker Change: Yes, it's a great question and you're right. We've been increasingly we've been growing our O&M business, our O&M and service business as follow on the service to customers interested.
Speaker Change: And in the support for.
Post capital sale and this is Ben.
Speaker Change: Part of our business many of the capital sales, we have have ongoing service and the value add to customers in the way that we're viewing.
Speaker Change: The offering is.
Speaker Change: We have a portfolio.
O&M.
Hub from which there is a lot of institutional knowledge and expertise, particularly in complex food weight sludge.
Speaker Change: Gas plant.
Speaker Change: With sophisticated technologies.
Speaker Change: And leveraging an operator, who is vertically integrated that was also the designer and the technology provider.
Speaker Change: Offers incredible value at the Derisk to customers.
Speaker Change: The design engineer is still part of the same group as the operations and so there is an integrated synergy with Knowhow.
Speaker Change: And this has been a sort of follow on offerings service. So.
Speaker Change: We're very flexible with the model, we want to put customers moved first and offer most value add and so.
Speaker Change: The business has been growing into sort of two pillars, either a service model, where we will do the ongoing service for the.
Speaker Change: Technology will provide <unk> with our expertise.
Speaker Change: Two a turnkey full O&M, even with asset management services as well to our customers and this has been a growing base that's been.
Speaker Change: A positive out of the outcome of our of our capital sales visits over the years and establishing a base.
Speaker Change: Globally.
Speaker Change: Okay.
Speaker Change: Understood understood and then Big picture I know you've made a lot of changes at the organization over the last one.
Speaker Change: Several months, but do you have an approximate revenue run rate, where you would you would expect EBITDA breakeven.
Okay.
Speaker Change: Greg.
Speaker Change: We cannot provide.
Speaker Change: We have it but yes.
Speaker Change: Yes, correct. We do know we do know internally what those numbers are we just can't share from our perspective.
Speaker Change: Projections and forward looking but.
Speaker Change: Where are.
Speaker Change: You had mentioned too on.
Speaker Change: Capital sales pipeline growth or bookings grow our revenues grow in the capital sales side at the end of those would get the O&M contracts, which is our goal and every single one of them.
And that so.
Speaker Change: So on a longer term goal.
Actually going into 2025 and forward, we're building backlog or starting to actually execute we have.
Speaker Change: We have several projects that have not been announced that are midsize are small projects that are more EP.
Speaker Change: Throughout throughout our system and those projects continue to come in.
Speaker Change: With our equipment and those offer also O&M contracts to come at the end of those as well.
Speaker Change: Because we are the best to operate our own equipment and technology. So it just makes sense.
Speaker Change: So I think on the question of where what level do we have to hit there is two things happening. Obviously, we're we're looking continually at our SG&A. So that number continues to be analyzed and reduce where we can.
Speaker Change: And second part of it is we're increasing top line and margins on projects.
Yes.
With the combination of both of those is going to get us to the point that you mentioned.
Speaker Change: Gas sooner than that.
Speaker Change: And later historical.
Speaker Change: And I Wonder if you guys decided to close.
Speaker Change: Yes, yes, so the.
Speaker Change: So the comparison year over year comparisons on SG&A as we roll forward into future quarters.
Speaker Change: The.
Speaker Change: Turbulent set.
Speaker Change: Encountered last year kind of impacts the.
Speaker Change: The historical reference point so.
Speaker Change: If we were to take a look at SG&A from what you printed this quarter 16 seven.
Would you expect the kind of volatility where you've had in the last year, where your LOE was 12, eight and your high with 27%.
Speaker Change: Or should we be looking at $60 seven as sort of a starting point, where things can maybe come down from there.
Speaker Change: How should we be thinking about SG&A because.
The last year with.
Speaker Change: It was not not a fair warning to compare you to at least in my opinion.
Speaker Change: Yes, I mean.
Speaker Change: On that side I would say that where we're currently running at.
As we grow the business, obviously, we're going to need a little bit more SG&A, but at the same time, we're reducing where we cannot other spot so.
Speaker Change: I mean, our goal is to reduce that number down further.
Speaker Change: However.
Speaker Change: We have a lot of engineering capacity and stuff and so we want to make sure. We are utilizing that as that becomes more utilized to that number also reduces so.
Speaker Change: It's kind of a combination of growth.
Speaker Change: And having the right people in place, which we do.
Speaker Change: And so I think when you think about that number.
Speaker Change: The total number the goal is to drive that down obviously to get that too.
Speaker Change: That makes sense for this FERC for our revenue.
Speaker Change: Projections.
Speaker Change: So thats.
Speaker Change: I can't answer it directly on that but I would say that if we're continuing to reduce where we can and.
Speaker Change: And Thats really the.
Speaker Change: That's really the point I want to make on that at this point.
Speaker Change: So youre right.
Speaker Change: Prior year run.
Yes, the prior year run rate was not that good.
Speaker Change: Comparison, because of all the noise, but.
Speaker Change: We still are.
Speaker Change: Looking at reduced outside services as much as we can.
Speaker Change: Those obviously are very expensive for the company in the prior year. So those items are definitely.
Speaker Change: Going to be benefits to us going forward as we reduce those.
Speaker Change: Okay.
Understood understood.
Speaker Change: Obviously, we're taking the right actions so historically the.
Speaker Change: Okay.
Speaker Change: The equipment business actually was.
Speaker Change: Pretty nice margin your consolidated margin of 27%.
Speaker Change: It's strong.
Speaker Change: Considering where you are in the cycle.
Speaker Change: Can you maybe describe what your target margins or your ideal margins would be.
Speaker Change: Looking forward towards towards the future with would it be conceivable for energy to see 30% margins out in the next couple of years or is mid <unk>, maybe a more fair.
Assessment.
Speaker Change: How should we be thinking about the gross margin structure at the company.
Speaker Change: Okay.
Greg Wolf: Yeah, Greg.
Greg Wolf: I was kind of like.
Greg Wolf: Okay.
Greg Wolf: Alright, sorry, Greg go ahead, I was just going to chime in here that I.
Our targets haven't changed from before.
Greg Wolf: With our business so targeting two.
2025% margins through our <unk>.
Greg Wolf: Sales and O&M business and higher margins through our build on operate portfolio continues to be continues to be the target of the trend and for the most part is in that direction.
Greg Wolf: Ooh.
Understood understood so structurally very similar.
But lower risk profile. So I appreciate that great well. Thank you for taking my questions. Congratulations on getting the business right sized and stable and we look forward to following your growth.
Fredrik: Thank you Fredrik.
Speaker Change: We have no further questions in the queue at this time, so that concludes the Q&A session. I will now hand, you back over to Darlene Webb for closing remarks. Thank you.
Fredrik: Okay.
Darlene Webb: Thanks again operator.
Darlene Webb: Thank you everyone as always for additional information or should you have any questions. Please do contact the IR team at IR at <unk> Dot com.
Darlene Webb: Online at <unk> Com.
Darlene Webb: Thank you all once again for your time today.
Speaker Change: Operator, you may now end the call.
Thank you that concludes today's <unk> 2024 conference call and webcast you may disconnect your lines.
Speaker Change: [music].