Q4 2024 Bruker Corp Earnings Call
© transcript Emily Beynon
Speaker Change: Good day and welcome to the Brugger Corporation fourth quarter 2024 earnings conference call.
Speaker Change: All participants will be in a listen-only mode. Should you need assistance, please signal conference specialists by pressing the star key followed by zero.
Speaker Change: After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one on your touch-tone phone. And to withdraw your question, please press star, then two. Please note this event is being recorded. I would now like to turn the conference over to Mr. Joe Kostka. Please go ahead, sir.
Speaker Change: Good morning. I would like to welcome everyone to Bruker Corporation's fourth quarter 2024 earnings conference call.
Speaker Change: My name is Joe Kostka, and I am the Director of Bruker Investor Relations. Joining me on today's call are Frank Laukien, our President and CEO, and Gerald Herman, our EVP and CFO.
Speaker Change: In addition to the earnings release we issued earlier today, during today's conference call, we will be referencing a slide presentation that can be downloaded from the Events and Presentations section of Brooker's Investor Relations website.
Speaker Change: Before we begin, I would like to reference Bruker's Safe Harbor Statement, which is shown on slide 2 of the presentation.
Speaker Change: During this conference call, we will, or may, make forward-looking statements regarding future events and the financial and operational performance of the company that involve risks and uncertainties, including those related to our recent acquisitions, geopolitical risks, market demand, or supply chains.
The company's actual results may differ materially from such statements.
Speaker Change: Factors that might cause such differences include, but are not limited to, those discussed in today's earnings release and our Form 10-K for the period ending December 31, 2023, as updated by our other SEC filings, which are available on our website and on the SEC's website.
Speaker Change: Also, please note that the following information is based on current business conditions and to our outlook as of today, February 13th, 2025.
Speaker Change: We do not intend to update our forward-looking statements based on new information, future events, or for other reasons, except as may be required by law, prior to the release of our first quarter 2025 financial results, expected in early May 2025.
Speaker Change: You should not rely on these forward-looking statements as necessarily representing our views or outlook as of any date after today.
Speaker Change: We will begin today's call with Frank providing an overview of our business progress.
Speaker Change: Gerald will then cover the financials for the fourth quarter and full year of 2024 in more detail and share our full year 2025 financial outlook.
Speaker Change: Now, I'd like to turn the call over to Brooker's CEO, Frank Laukien.
Frank Laukien: Thanks, Joe. Good morning, everyone. And thank you for joining us on today's fourth quarter 2024 earnings call.
Frank Laukien: Brooker finished 2024 with another quarter of excellent constant exchange rate revenue growth and solid organic revenue growth both higher than what we had expected for Q4 24 given our very strong Q4 23
Frank Laukien: which, if you recall, had organic revenue growth of nearly 16%.
Frank Laukien: For the full year 24, we again delivered double-digit CER, constant exchange rate revenue growth, at 14% and 4% organic revenue growth, well above the market which we estimate was flat to down slightly in fiscal year 24.
Frank Laukien: This is a testament to the strength of our portfolio of innovative solutions, culture of disciplined entrepreneurialism, and our broker management process.
Frank Laukien: In fiscal 24, we added strategic spatial biology, molecular diagnostics and lab automation platforms to our portfolio, continuing our multi-year transformation into a growth-oriented industry leader with scale and position for leadership in the post-genomic era.
Frank Laukien: This transformation is not just focused on growth, but also very much on higher margin potential and more rapid EPS increases going forward.
Frank Laukien: We intentionally accepted initial margin and EPS dilution from our strategic M&A in order to unlock new very large market opportunities and strong secular growth tailwinds.
Frank Laukien: But also in order to further raise the margin potential and EPS growth profile of Bruker
Frank Laukien: Looking to 2025, we enter the year with good bookings momentum.
Frank Laukien: We start 2025 with solid BSI segment backlog of still over six months of revenue, in part due to our Q4-24 book-to-bill ratio of ended up at 0.99 or essentially 1.
Frank Laukien: We also have begun to receive first orders related to the China Stimulus Program, with over 15 million of China Stimulus orders in the second half of 2024, most of it in the fourth quarter, and with more on the horizon.
Frank Laukien: We acknowledge U.S. NIH and academic government market uncertainty and have built that into our guidance. But we fundamentally, after some settling, we fundamentally do not expect a reduction in NIH and other life science, medical, and research investment in the U.S.
Frank Laukien: Finally, we experience strong market trends in diagnostics and in semiconmetrology, as I will show you later, and we also see signs of a biopharma recovery.
Frank Laukien: Accordingly, we are establishing our fiscal 25 guidance for constant exchange rate revenue growth of 5-7%, with 3-4% organic growth and 2-3% contributions from M&A.
Frank Laukien: compared to our 24 level of 15.4%, which, by the way, was also a bit higher than what we had expected.
Frank Laukien: Finally, we expect non-GAAP EPS growth of 11 to 13 percent with 14 to 16 percent constant exchange rate EPS growth all compared to 24.
Frank Laukien: Turning to slide 4 now, in the fourth quarter of 24, Bruker delivered strong revenues and non-GAAP operating margin, and stronger operating margin expense, margins than expected.
Frank Laukien: Brooker's Q4'24 reported revenues increased 14.6% year-over-year to $979.6 million, which included an FX headwind of 1.2%.
Frank Laukien: constant exchange rate or CER revenue growth of 15.8% year-over-year, included organic growth of 3.9%,
Frank Laukien: with 4.5% organic growth in our BSI segment and an organic decline of minus 2.8% at best, all net of company in intercompany eliminations.
Frank Laukien: Revenue from acquisitions added 11.9% in the fourth quarter of 2014.
Frank Laukien: In the fourth quarter 24, our non-GAAP operating margin was 18.1%, which actually matched our Q4-23 margin, a strong organic operating margin expansion of 300 bps.
fully offset margin dilution from M&A and FX.
Frank Laukien: Our strong organic operating margin expansion is evidence of the progress our operational excellence processes and M&A integration activity initiatives are making.
Frank Laukien: Finally, Q4 non-gap diluted EPS was 76 cents, up 8.6% from 70 cents in Q4 of 23, and we are pleased that in the fourth quarter of 24 we were able to resume non-gap EPS growth year-over-year.
Frank Laukien: All right, moving to slide five now, Bruker's strong growth performance amidst challenging marketing conditions in fiscal 24 once again delivered above-market organic revenue growth.
Frank Laukien: Fiscal year 24 reported revenues increased by 13.6% to $3.37 billion, with 14% CER revenue growth. On an organic basis, revenues grew 4% year-over-year, consisting of 4.2% organic growth in scientific instruments and 1.9% organic growth at best, net of eliminations.
Frank Laukien: Acquisitions added 10% revenue growth and there was a slight 0.4% FX revenue headwind for the year.
Frank Laukien: Our 2024 non-GAAP growth and operating margin and GAAP and non-GAAP EPS performance are all summarized on slide 5.
Frank Laukien: Margins and EPS were down year over year as a result of the expected initial dilution from our strategic acquisitions that closed in the first half of 24.
Frank Laukien: Please turn to slides 5 and 6 now, where we highlight our fiscal year 24 constant exchange rate performance of our three scientific instruments groups and of our best segment year over year.
Frank Laukien: Biospin saw strong revenue growth in Europe and the Americas, as well as in industrial research, AcaGov markets, and biopharma, with strong contributions also now from our automation, service, and software business.
Frank Laukien: We had revenue from four gigahertz class NMR systems each in 24 and 23 and in Q4 24 we had revenue from one 1.2 gigahertz NMR at the University of Zurich in Switzerland.
Frank Laukien: 424, the Calit group had revenue of 1.1 billion and CER growth in the mid-teens percentage with strong growth in microbiology and infection diagnostics.
Frank Laukien: Driven by both the MALDI Biotyper and the newly acquired Elitech Molecular Diagnostics business.
Frank Laukien: as well as our optics IR, near IR, and Raman molecular spectroscopy business. This was partially offset by softness in Akagov and in our China business.
Frank Laukien: On slide 7, Rupert Nano's 24 revenue was also 1.1 billion and grew in the high-teens percentage CER, with growth driven by ACAGOV research and semiconductor metrology.
Frank Laukien: The high-performance computing and AI megatrend is a strong tailwind for our semiconductor and advanced packaging tools.
And we now have.
Frank Laukien: north of 125 million of AI and HPC-related semiconductor nanotool metrology revenues, and more overall for semiconductor metrology, but not all of it is AI-related, as far as we can tell.
Frank Laukien: So anyway, integration of our cellular analysis and spatial biology business is progressing very well, but in 24, we still saw it was moderated by softer demand from biopharma.
Frank Laukien: Finally, 24 best revenues grew in the low single digits percentage net of intercompany eliminations driven by growth in accelerator and fusion technologies at our research instruments or our eye business. Our eyes also getting traction in extreme UV or EUV lithography technologies which are used in manufacturing next-gen semiconductors.
Frank Laukien: This strength was partially upset at best by softness in clinical MRI superconductors.
Frank Laukien: Moving to slide 8, we highlight two of our businesses, namely our microbiology business and Semicon Metrology. Couldn't be more different, but both are doing very, very well and both also, when they grow and they do, have above corporate average margins.
Microbiology and Infectious Diagnostics
Frank Laukien: has had growth in the mid-teens in the fourth quarter and high single digits throughout the year.
Frank Laukien: with an installed base of now more than 7,000 Maldive biotipers.
Frank Laukien: and also bolstered by the ELITEC Molecular Diagnostics Acquisition, which closed at the end of April in 24. Very pleased with that business.
Frank Laukien: It has very little China, very little NIH, very little biopharma exposure. These businesses are humming along and doing really well. The same is true for semiconductor metrology, where organic revenue growth was actually greater than 20% in the fourth quarter and low teens in fiscal year 24. Our total annual revenue for all semiconductor metrology is north of $250 million.
Frank Laukien: and included within that, maybe half of that goes to high performance computing and AI.
Frank Laukien: Right, I will not spend a lot of time on slide 9. It is sort of a slide that we showed at the J.P. Morgan Health Care Conference, but it is sort of the, you know, the really big picture on Bruker. We have attained scale with 70% cumulative revenue growth in the last four years. We're now
Frank Laukien: I'll add above 3.35 billion. We added 400 billion in revenue, 400 million, excuse me, 400 million in revenue last year and our four-year constant exchange rate revenue CAGR had been, it was 15%.
Frank Laukien: I think that's industry leading. We've also demonstrated previously, namely in the
Frank Laukien: 14 to 22 period that we have the management process and the team to really drive operating margin expense expansion in fact we drove a thousand dips over eight years
Frank Laukien: Before we then very intentionally did some of the strategic acquisitions that are temporarily dilutive, but I think that ultimately
Frank Laukien: Give us not only a bigger platform and scale and get us into Greek peak growth markets with very large stamps but also financially improve the ultimate margin profile of the company
Frank Laukien: So enough of that at the very bottom you'll see that our next for the next three years goals
Frank Laukien: three years, including 25, of course, we're very committed to an annual greater than 125 bps non-gap operating margin expansion. As you've heard, this year we're aiming for 140 bps.
Frank Laukien: And we're also very committed to 13 to 15% constant exchange rate EPS.
Frank Laukien: growth this year, you'll see we were aiming 14 to 16 percent. So we really have executed and continue to execute this very successful multi-year transformation into a growth-oriented industry leader with very attractive margin and EPS opportunities.
Frank Laukien: Right, so in summary, the year 24 was transformational for Brooker. We completed key strategic acquisitions to access very large addressable markets with strong secular growth tailwinds.
Frank Laukien: while bringing additional spatial biology, molecular diagnostics, and lab automation and software platforms into our portfolio. For the fourth year in a row, Bruker has delivered well above market organic and double-digit CER revenue growth.
Frank Laukien: So after approximately 70% cumulative revenue growth in the last four years, we have transformed and we have achieved highly competitive scale, which is an excellent foundation for significant margin expansion and rapid EPS.
Frank Laukien: So we have further transformed our differentiated portfolio to position it not only for growth and margin expansion, but very much to be a leader or the leader in the post genomic era, which we believe will define the next quarter century in life sciences.
Frank Laukien: So with that high-level outlook, I'll turn things over to our CFO, Gerald.
Gerald Herman: Thank you very much, Frank. And thanks, everyone, for joining us today. Pleased to provide more detail on Brooker's fourth quarter and full year 2024 financial performance, starting on slide 11.
Gerald Herman: In the fourth quarter of 2024, Brooker's reported revenue increased 14.6% to $979.6 million. It reflects an organic revenue increase of 3.9% year-over-year.
Gerald Herman: Geographically, and on an organic basis in the fourth quarter of twenty-four, America's revenue grew in the low single-digit percentage, European revenue grew in the mid-teens range, while Asia-Pacific revenue declined in the high single-digit percentage all year over year.
Gerald Herman: For our EMEA region, the fourth quarter 24 revenue was up mid-single-digit percentage year-over-year.
Gerald Herman: PSI, organic revenue growth in the fourth quarter of 24 was 4.5%, a solid revenue performance on top of an exceptional fourth quarter of 23, got 15.5% organic growth.
Gerald Herman: BSI fourth quarter 24 organic systems growth was in the low single-digit range with aftermarket revenue growth in the low double-digit range percent year over year.
Gerald Herman: For the full year 2024 aftermarket revenue represented over 30% of BSI revenues for the first time.
Gerald Herman: Non-GAAP gross margin increased 70 basis points in the fourth quarter of 2024 to 52.5 percent as pricing and operational excellence initiatives continued contributed to gross margin expansion year over year.
Our fourth quarter, 24 non-GAAP operating income increased 14.9% year-over-year.
And we posted a non-GAAP operating margin of 18.1%.
equal to that reported in the fourth quarter.
Gerald Herman: We should not yet have margin dilution associated with some of our first half 24 acquisitions.
Gerald Herman: On a year-over-year basis, we delivered excellent organic operating margin expansion of 300 basis points in the fourth quarter 24, driven by volume, mix, operational excellence, and integration synergies.
Gerald Herman: This significant organic operating margin expansion fully offsets the margin dilutive impact of our earlier strategic M&A and FX in the quarter.
Gerald Herman: On a non-GAAP basis, Q4'24 diluted EPS was $0.76, up 8.6% from $0.70 in Q4'23.
Gerald Herman: Our non-GAAP effective tax rate was 32.5% compared to 31.3% in the fourth quarter of 2023, with the increase driven mostly by jurisdictional mix and discrete items.
Gerald Herman: On a gap basis, we reported diluted EPS of $0.09 per share, including significant acquisition-related costs.
Gerald Herman: Compared to $1.41 per share in the fourth quarter of 23, which included a one-time $0.99 per share non-cash bargain purchase gain arising from the Phenomics acquisition.
Gerald Herman: Weighted average diluted shares are standing in the fourth quarter of 2024 452 million an increase of 6 million shares or 4.1 percent from the fourth quarter of 2023 resulting from our follow-on equity offering in May of 2024
Gerald Herman: Turning now to slide 12, we generated $189.9 million of operating cash flow in the fourth quarter of 2024. Our capital expenditure investments were $38.8 million, resulting in free cash flow of $151.1 million in the fourth quarter of 2024.
Gerald Herman: This reflects a cash flow decrease of $23 million compared to the fourth quarter of 23, a significant acquisition related expenses and restructurings more than offset better working capital performance in the fourth quarter of 24.
Gerald Herman: We finished the fourth quarter of twenty-four with cash, cash equivalents and short-term investments of approximately one hundred and eighty-three million dollars.
Gerald Herman: During the fourth quarter, we used cash to fund selected Project Accelerate 2.0 investments, capital expenditures, and completed debt repayment of about $50 million.
Gerald Herman: In addition, with improved cash flow entering 2025, returning capital to our shareholders through our existing share buyback programs is an attractive opportunity at this time.
Gerald Herman: Slide 13 shows our non-CAP P&L results for the full year of 2024.
Gerald Herman: Revenue was up 13.6% to $3.37 billion, reflecting organic growth of 4%.
Gerald Herman: Acquisitions added 10% to our top line, while foreign exchange was a 0.4% headwind, resulting in constant exchange rate revenue growth of 14% year-over-year.
Gerald Herman: The remainder of the non-GAAP P&L results for the full year of 2024 are summarized on slide 13 with the drivers as explained and on the slide.
Transcript by Rev.com Page of
Gerald Herman: Turning now to slide 14, in the full year of 2024, we generated $251.2 million of operating cash flow, down about $99 million from 2023, as a result of lower net income and significant acquisition-related expenses and initial working capital needs for our acquired businesses.
Gerald Herman: Turning now to slide 16, we enter the year with a stronger transformed portfolio, healthy backlog and emerging order momentum.
We're initiating guidance for a full year 2025 as follows.
Gerald Herman: Reported revenue of $3.47 billion to $3.54 billion, representing reported growth of 3% to 5%, and constant exchange rate revenue growth of 5% to 7%, all compared to 2024.
Gerald Herman: For operating margins in 2025, we expect non-GAAP operating margin expansion of approximately 140 basis points compared to the 15.4% we posted in 2024.
Gerald Herman: On the bottom line, we're guiding to non-GAAP EPS for 2025 in a range of 267 to 272, or non-GAAP EPS growth of 11 to 13% compared to 2024.
Gerald Herman: This includes an approximate 3% foreign exchange headwind, and our non-GAAP CER EPS growth guidance for 2025 is therefore 14 to 16% year over year.
Gerald Herman: Other guidance assumptions are listed on the slide. Our fiscal year 25 ranges have been updated for foreign currency rates as of December 31st, 2024.
Gerald Herman: We anticipate first quarter 2025 organic revenue to be roughly flat year-over-year, with CER revenue growth in the mid-single digits.
Gerald Herman: In the first quarter of 2025, we expect softer operating margin performance year over year, as we experience some dilution from our NanoString acquisition completed in early May of 2024.
Gerald Herman: To wrap up, Brouker delivered meaningfully above-market organic growth in 2024 and were well-positioned to deliver strong CER revenue and non-GAAP EBS growth in 2025. With that, I'd like to turn the call back over to Joe. Thank you very much.
Thanks, Gerald.
Gerald Herman: We'll now begin the Q&A portion of the call. As a reminder, to allow everyone time for questions, we ask that you limit yourself to one question and one follow-up. Operator?
Speaker Change: Thank you. We will now begin the question and answer session. To ask a question, you may press star then one on your touch-tone phone. If you're using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star then two. And at this time, we'll pause momentarily to assemble our roster.
Kunit Suda: And the first question will come from Kunit Suda with Laring Partners. Please go ahead.
Kunit Suda: Yeah, hi, Frank. My first question is on the on the guide. I mean, the full year guide is a, you know, three to four percent organic growth, which is a higher at the higher end versus what you had before the NIH and direct announcements and direct cuts.
Kunit Suda: So just trying to understand what sort of gives you the confidence on the instrumentation sales. I mean, obviously, Brooker has instrumentation, has more exposure to instrumentation.
Kunit Suda: I mean, so just trying to understand, is it elite tech? Is it AI? Is it aftermarket service or European offsets that are...
Gerald Herman, Frank Laukien, Gerald Herman, Joe Kostka, Unknown Executive
Speaker Change: Thank you, Puneet. Yeah, no, I think there's, you know, there's puts and takes. There's plenty of them. It's a dynamic environment. We already, for some other reasons, had indicated that we, even at J.P. Morgan, that we thought that there would be
Uncertainty in government-supported research and, of course, that uncertainty
Speaker Change: is there. We all know why. And, you know, we just looked at that. I mean, NIH is less than 5% of our exposure, if you like.
Speaker Change: I did some of them. We did some of the modeling. Look, if that came down 8 to 10%, which I think it's not going to happen, but it could happen.
Speaker Change: Unknown Speaker Well, you know, that would be maybe 15 million a little bit more of less revenue. And for that, I think we have enough other growth drivers, you know, outside of the United States with biopharma coming back a bit, maybe not roaring back, but coming back.
Speaker Change: Some China stimulus funding that may be offsetting or more than offsetting that
Speaker Change: Microbiology, Semiconductor, AI, Applied Markets, all the way to Defense Spending in Europe, quite honestly. There are enough drivers that if we put it all together, you know, three to four percent organic growth is not...
Speaker Change: It's not an astounding number but you know for this year I think it's solid and I think we've built up
Speaker Change: I'm not saying this is conservative. I think it's very balanced, quite honestly. And yeah, and we really manage, at the end of the day, for the constant exchange rate revenue growth, right? Even as you go through the quarter, some of them will have more CER, some of them will have more organic growth.
So I'm very, I'm very
Speaker Change: And there we have also enough route.
Speaker Change: Opportunities to make that happen even with some NIH.
Speaker Change: Which we're now assuming some NIH funding being less search and in the first half of this year or maybe throughout the year. So we feel good about this and are very committed to that and it all adds up to you know.
Speaker Change: 14% to 16%.
Speaker Change: Constant exchange rate EPS growth. Unfortunately, there is a bit of a headwind, but ive up for.
Speaker Change: For EPS and I've indicated that a J P. Morgan already as well so with that the reported EPS growth of 11% to 13%.
Speaker Change: No.
Speaker Change: Okay.
Speaker Change: It's not it's a good number and it's even better if you disregard FX, but of course, it's a reality. So we think all in I think this is a.
Speaker Change: This is very good.
Speaker Change: Greater commitment to solve for margins and EPS if in doubt that's what we'll that's what will change in the company in terms of Opex and other things to deliver that but also have reasonable confidence in the in the in the revenue growth.
Speaker Change: Thanks for that.
Speaker Change: Could you talk a bit about you know the assumptions in Q1, what are you hearing from the customers in terms of instrumentation placements their ability to <unk>.
Speaker Change: <unk> been instrumental to install and get them signed off in Q1 and sort of.
Speaker Change: The main question being that some of the facilities are very much supported by the indirect cuts.
Speaker Change: I recall when I purchase your solar X 15, Tesla magnet many years ago, I mean, we have to take down the walls that was facilities. So if you could maybe just elaborate what youre hearing from the customers and your ability to continue to install here and any backlog cancellations that you contemplate.
Speaker Change: Just given the NIH backdrop. Thank you.
Speaker Change: We have not heard anything about any backlog cancellations.
Speaker Change:
Gerald Herman: That's why we're a little bit cautious on Q1 as you've heard from Gerald right. We think we've baked that into that Fortunately in Q1, we still also have quite a bit of.
Gerald Herman: M&A growth. So I think our mid single digit CER revenue growth looks good but indeed as you have seen weak.
Gerald Herman: We have said organically we might be.
Near flat in Q1, which is baking in.
Gerald Herman: Now a cushion than some belts and suspenders hopefully for some of that uncertainty no specific anecdotal hey, I don't get my you know.
Gerald Herman: I don't get my lab ready or I don't have I don't know power Cryogens, we havent heard any of that but right. Now obviously there is uncertainty and then yeah. There was a stay of that order and we think this has to be that there will be a new paradigm. I think there is no going back note going back, but I think there also will be either they will have.
Gerald Herman: A new funding category, where they put the $4 billion saved back into infrastructure or other you know.
Gerald Herman: Scientists are clinical research projects, we don't think there'll be simply a cut quite honestly I think that's almost bipartisan in Congress and and I don't know that the new HHS and NIH administration has said we want to cut budgets I think they want to re prioritize and most see how what that does but I think net net it will still be a lot of re.
Gerald Herman: Search and validation funding for the type of instruments and aftermarket solutions that we that we and others in the industry make so I'm not doom and gloom on the NIH and overall spending philanthropic and other end state spending many of these things are very strong there are many other funding sources.
Gerald Herman: But yes, we've built in.
Gerald Herman: You know hopefully something that's that.
Gerald Herman: That <unk>.
Gerald Herman: Except that there is uncertainty certainly in Q1 and probably into Q2 into the cadence of our quarters.
Gerald Herman: By the way. It's also not all back end loaded I think already by Q2, where much more even even just the way our revenue flows going Q2 through Q4, I think you'll see pretty strong improvements year over year.
Gerald Herman: Got it thanks for that.
Gerald Herman: Yeah. Thank you.
Operator: The next question will come from Patrick Donnelly with Citi. Please go ahead.
Operator: Hi, Good morning, Lindsay on for Patrick. Thanks, So much for taking my questions. I guess first can you talk a little bit about <unk>.
Operator: Government budget in Europe, and China, I think you touched on it but on stimulus.
Speaker Change: Great to hear more on that thank you.
Operator: Yeah.
Operator: They've been Oh of course in China. There is no stimulus funding you know, it's not going to be this one or two quarter bolus, which in a way it's nice for us it's going to be much more spread out with <unk>.
Operator: Some of that has begun to come in already a little tiny bit in Q3, a little bit more in Q4, we expect more in the first half of this year, but.
Operator: It may even come out throughout the year it may be more of it for us in terms of revenue at 24, sorry, I Misspoke 25, and 26 effect, which is great I'd rather have these things be a little bit smooth over multiple quarters.
Operator: Europe has been.
Operator: You also mentioned the rest of Asia. There is there is a lot of Asia Pacific, Taiwan, Korea, even Japan other parts of India, which is not at the Pacific, but nonetheless, those those have been strong ish and some of that is making up for a little bit of weakness in China, you may you'll hear that from others.
Operator: As well Europe has been reasonably good recently and and and.
Operator: And so all in I think <unk> Gov is not going to be great. This year, but I think it's not going to be that bad it's not all.
Operator: And then you know Theres, just a lot of others strength and growth drivers that we see this year that I mentioned earlier.
Operator: That don't depend on HOKA Gov. So yeah.
Operator: With all in I think again, we tried to bake all of that into our guidance range of this you know 5% to 7% CER revenue growth.
Operator: And Uh huh.
Operator: I think it's reasonable.
Operator: Great and then just one more.
Operator: Brendan.
Operator: This year is kind of the right way to think about it entirely.
Operator: Or.
Operator: Am I thinking about that right.
Operator: Yeah.
Gerald Herman: This is gerald yes, the or thinking about it correctly, we're moving from roughly 15% to 20, plus cents dilution coming out of 24% to eight to 10 and 25 on the EPS line, that's correct and then hopefully and they're very much hope to be near breakeven and minus six.
Operator: So it's it's.
Operator: <unk>.
Operator: And again it shows you some of our ability to flex with some of the biopharma business than cellular analysis, and spatial biology being being relatively weak in 'twenty four we flex to make that happen.
Operator: And.
Operator: And again, we're on track for exactly those numbers that you asked about.
Operator: 425.
Operator: Still very much looking to have breakeven from that in 2006 already.
Operator: Okay appreciate it.
Operator: Sure.
Speaker Change: The next question will come from Michael Rifkin with Bank of America. Please go ahead.
Speaker Change: Hi, This is Julia on for Mike.
Speaker Change: Do you have an update on Biopharma recovery timing and I expect to not see the second half of this year.
Speaker Change: With good good question Julien, we think it's going to we don't think it's a step function. We think it's going to be gradual. So we're expecting that already in the first half of this year, but maybe getting stronger in the second half of the year I think that's maybe a better way to think about it.
Speaker Change: Okay. Thank you very much.
Speaker Change: Mhm.
Operator: The next question will come from Lukas <unk> with Barclays. Please go ahead.
Speaker Change: This is Sam on for Louise Thanks for the questions.
Speaker Change: Is the expectation still to play somewhere in the realm of three to four UHF MMR as this year kind of in line with or you have placed in the past couple of years and then.
Speaker Change: Could you talk about the geographic concentration of the backlog in BSI is that relatively in line with your exposure or do you see it kind of higher in regions, where youre seeing the most strength.
Speaker Change: Oh good question Yeah.
Speaker Change: This might be a year with three ultra high field systems in 'twenty five indeed last two years, we had four of them.
Speaker Change: Before this year, but.
Speaker Change: Presently expecting three all baked into the guidance.
Speaker Change: And geographic breakdown of backlog for BSI.
Speaker Change: I assume that's consistent with R. J.
Jason: Jason do you have a follow up on that.
Speaker Change: Consistent with our geographic mix.
Speaker Change: So nothing unusual there is the answer right.
Speaker Change: The only thing I would add is the backlog level at this point.
Speaker Change: <unk>.
Speaker Change: Close to seven a little over seven months at this stage. So it hasnt really changed dramatically from the third quarter coming out of the forwards. So we still have a fairly significant backlog level. The composition is as grant just described similar to our overall geographic mix with the numbers a little bit.
Speaker Change: Not terribly changed from where we were in the third quarter and if I may for since the consumables heavy businesses like <unk> molecular diagnostics or even the cellular analysis and spatial biology businesses.
Speaker Change: By their nature have less backlog.
Speaker Change: Yes.
Speaker Change: We probably will have a normalized backlog level, that's not five and a half but five so.
Speaker Change: We have we can continue to cushion this year and any NIH certain uncertainties et cetera, and we do some of that with our are still elevated backlog that has remained stubbornly high and Thats. A good thing of course, we had modeled previously to where it would come to you know below six and five and a half.
Speaker Change: Right about now.
Speaker Change: But book to Bill has been reasonable throughout the year and pretty quite good for a strong Q4 being at <unk> 99 is excellent so.
Speaker Change: Yeah. So.
Speaker Change: We are we continue.
Speaker Change: To benefit from that and it also allows us to do some good quarterly planning in cushioning, because we so it's a bit of a luxury position, but it's good.
Speaker Change: Good to have.
Speaker Change: That's helpful. I appreciate that and then.
Speaker Change: On operating margins you are targeting around 140 basis points of expansion rate.
Speaker Change: I'm just wondering if you could give some puts and takes on that kind.
Speaker Change: Kind of bucket out the assumptions on the operational improvements on the existing business versus whats continuing to come from the integration of M&A, maybe a little bit on FX as well.
Speaker Change: And kind of in that vein I know you guys do.
Speaker Change: Get them out of manufacturing in Europe are you guys contemplating anything on potential tariffs there.
Speaker Change: How are you thinking about the potential risk.
Speaker Change: Okay.
Speaker Change: And lots of good questions. Yeah, 140 bps of course, there's always a bit of a range around that but that looks like a reasonable number.
Speaker Change: So yeah that would bring us to about 16.8, but it could be a little bit higher could be a tad lower than that but thats I think thats a 140 bps is a good number.
Speaker Change:
Speaker Change: It's all in so we haven't tried to there is some there is continued organic headwind here probably around 50 bps, but there is also a little bit of FX tailwind. So it's net net there is that there is a.
Speaker Change: Non organic let me get this right nonorganic headwind.
Speaker Change: So you know without all of these headwinds in an ideal world it would be even better than 140 bps, but this is an all in number including FX and including yes about 50 bps of organic headwind.
Speaker Change: Tariffs.
Speaker Change: Right I mean, we do manufacture in the U S. We manufacture in Europe, we manufacture in Malaysia, those are our major sites, who do not manufacture in China.
Speaker Change: So we have a lot of flexibility and we can turn on a dime, but if there <unk>.
Speaker Change: So far we don't seem to be affected but you never know what happens.
Speaker Change: Things are happening quickly. So if we needed to respond we can respond within a few quarters.
Speaker Change: And.
Speaker Change: Yeah.
Speaker Change: I don't think we'll be singled out for punitive tariffs or anything like that I mean. This is this is our instruments also including those coming from Europe and many of them are coming from the U S. But then they have been coming from Europe are needed for our life Science research enterprise here in the U S.
Speaker Change: So.
Speaker Change: We can we can we have flexibility we have.
Speaker Change: A number of.
Speaker Change: Operations in the U S that do manufacturing in final test and if we needed to modify some of move some of the production over here for the U S market, we could certainly do that.
Speaker Change: I appreciate the detailed interest rank.
Brandon: The next question will come from Brandon <unk> with Wells Fargo. Please go ahead.
Hey, good morning.
Brandon: Thank you would be great to get an update on the <unk> platform.
Brandon: David installed base figures you have a revenue run rate for that platform, how you think about growth and 25.
Brandon: Yes, so Tim stuff is doing better again, you know obviously, we had some competitive.
Brandon: Dynamics there when when the when that other instruments first came out and we've recovered from some of that with some very good.
Brandon: Further improvements of the various teamstaff models here and it's the same stuff is more of a platform with multiple models.
Brandon: Both at <unk> and then also quite importantly, it at the international <unk> last.
Speaker Change: Last year so.
Speaker Change: Our win rate has come back and it's you know it remains competitive theirs.
Speaker Change: Two good platforms on that market.
Speaker Change: And thats good for the market overall so.
Speaker Change: So you know so there is somewhat muted the growth, but with a win rate improving more recently I think that will pick up again and.
Speaker Change: Yeah.
Speaker Change: Yeah. So you know it's about.
Speaker Change: Not far from a $200 million business, so it's a meaningful business for us.
Speaker Change: And and also tends to have good margins and of course is strategically very important to us you'll see a lot of activity. This year in terms of further improvements refinements, new models and things like that so and we invest a lot of our investments are going in this direction for the.
Speaker Change: For proteomics and the various flavors of that from Proteoform profiling of intact, two all the way too.
Speaker Change: Two <unk> metabolomics Lycoming it's.
Speaker Change: A very key it's one of the breakout along with spatial biology is one of the breakout opportunities of the company and we're very heavily investing there.
Speaker Change: So.
Speaker Change: Doing what it's doing it's doing good in its growth rate is recovering.
Speaker Change: Two questions for Gerald.
Speaker Change: Could you break out the impact of currency on operating margin guidance for the year and then secondly inventories came down a lot sequentially, maybe that was currency.
Speaker Change: Are you thinking about free cash flow conversion in 2005.
Speaker Change: Yeah. So on the first question Brendan.
Speaker Change: Yes, I think generally on for 25, we're expecting a 3% foreign exchange headwind right now and that's just where it is we will see how it all plays out.
Speaker Change: And as we get it down further.
Speaker Change: In 2025, we start to see some movement thereafter.
Speaker Change: And on the cash flow conversion.
Speaker Change: We had quite a good quarter I would say notwithstanding.
Speaker Change: Some acquisition related expenses in the fourth quarter we.
Speaker Change: We generated a significant amount of working capital improvement in the fourth quarter and I'm expecting to see that continue.
Speaker Change: And as we move into 2025, our free cash flow conversion has improved I think significantly after.
Speaker Change: I would say some.
Speaker Change: Some challenges, especially related to initial working capital associated with the acquired businesses, but overall.
Speaker Change: We're pretty pleased with the performance in the fourth quarter, we expect to continue to see it yeah. Our operational teams and our finance teams are doing a great job with free cash flow conversion thats already improving as you have seen in Q4.
Speaker Change: And that'll be another big focus for 25, obviously as we either further deleverage or do more share buybacks.
Speaker Change: I think that's that's the priority gives us more flexibility.
Speaker Change: I think maybe one earlier modeling question that you had Brandon on our 140 bps 25 operating profit margin.
Speaker Change: Expansion, the net headwind between a larger M&A headwind and a smaller FX tailwind is about the net the net headwind is about 20 bps.
Speaker Change: I hope that helps and addresses.
Speaker Change: To your question.
Speaker Change: Okay. Thank you.
Speaker Change: The next question will come from Doug Schenkel with Wolfe Research. Please go ahead Sir.
Speaker Change: Hi, This is madeline Goldman on for Doug.
Speaker Change: Gerald if conditions with the NIH or in China do deteriorate can you talk through what levers do you have at your disposal to protect the margin and EPS.
Speaker Change: Guidance, and then thinking about the NIH funding, specifically, if the environment does deteriorate.
Speaker Change: Things that you can do to reduce adoption friction to adoption of products like funding for capital funding for capital equipment becomes more challenging.
Speaker Change: Okay.
Speaker Change: It's all a Florida as I said earlier, it's kind of baked in Reits, we have done some sensitivity modeling.
Speaker Change: We read your research. So for instance, we did model an 8% decline, which we don't think will happen, but it could happen in the first half maybe with some catch up in the second half and so those type of reasonable scenarios, including.
Speaker Change: Delays and also a flat out reduction in NIH budget. This year by for instance that 8% figure thats floating out there mathematically.
Speaker Change: We think we've got we've put that into the guidance that's why.
Speaker Change: Maybe our guidance would have been a little higher but you know this is something we've really tried to take into account can you predict everything this year of course, not but I think we've done a reasonable job in putting some sitting there some unpleasant NIH scenarios into our guidance.
Speaker Change: Have we put in a worst case of course, not know, but I think there won't be a worst case, but a reasonable contingency has been built in.
Speaker Change: And we've also as you've seen.
Speaker Change: Have taken that through margins and EPS. So it is also built into that not only at the revenue growth level.
Gerald Herman: So we think we have enough strength Gerald you would like to ask something so I was just going to say with respect to your other part of your question on 25 in the company I'll just remind folks that the company is still quite a global organization, we still have significant.
Gerald Herman: Revenue performance in other geographies outside of the United States, 70% of our revenues coming ex U S. So there is still significant.
Gerald Herman: Order backlog or our performance across most of our other areas of growth are continuing here I'm talking about the two areas Frank highlighted the semi semiconductor metrology area are.
Gerald Herman: Microbiology infectious disease businesses, we have very solid performance across industrial businesses in other geographies. So I think that the general portfolio of the companies really pretty transformed to a level, where it's not really only about academic government research funding and even if it's more focused on that.
Gerald Herman: There is plenty of global opportunities outside of the U S.
Speaker Change: Great. Thank you and then on the topic of the make America Hockey again movement can you talk a little bit how burger is positioned to benefit from things like increases in water environmental and fever testing, what's your exposure there and do you have anything goes into your guidance around that.
Speaker Change: Yeah, we have quote we have applied our markets business as well.
Speaker Change: So we do some P fast testing in PFS.
Speaker Change: Sure.
Speaker Change: Research and testing.
Speaker Change: Some other companies have more of that than we do but we are involved in some of those markets as well.
Speaker Change: Clearly.
Speaker Change: As people are looking at validation studies on I think in the Maha in some ways, making micron healthy again.
Speaker Change: In my in my way of thinking very very much supports that you look at now I'm going to get a little nerdy, but that you look at the phenom that you look at the post genomic total.
Speaker Change: Organism the patients and don't just do genomic medicine and things like that because they don't change so much with food and environmental factors. So in a in a subtle way, but perhaps in a fundamental way, it's going to drive us much more towards this whole old human Phenom biology.
Speaker Change: Testing and and not all and Thats, all very much where we're aligning direction really so there is a subtle long term effects that I think will be very powerful forwards for the type of medical research that we are prepared to support and that this new administration seems to be focusing on that nobody is quite.
Speaker Change: Said, it that way, but if you think about it more deeply it's actually going to very much accelerated post genomic.
Speaker Change: Era, and the whole human genome biology.
Speaker Change: Great. Thanks, It was a bit much for a financial call, but I think it's important.
Speaker Change: [laughter].
Speaker Change: The next question will come from Rachel Vancil with Jpmorgan. Please go ahead.
Rachel Vancil: Hi, Thanks. Good morning, Thanks for taking my questions guys. So I wanted to dig into that first quarter Guide you mentioned that youre, assuming flat organic growth mid single digit CER. So thats really implying a mid single digit contribution from acquisition. It looks like the street was modeling in double digit number for the first quarter in terms of M&A contribution. So can you unpack there's M&A.
Rachel Vancil: Assumptions for us in the first quarter are there any one timers is there conservatism baked into the M&A assumption and then what type of cadence are you assuming for M&A contribution throughout the year.
Rachel Vancil: Yeah.
Rachel Vancil: Right. It will have the biggest impact in the first quarter ratio of course right because the.
Rachel Vancil: The two larger acquisitions close back to back in April 30th N may six from what I remember Thats Alphatec and nano strength.
Rachel Vancil: Whereas Kevin speed close somehow in the middle of the first quarter. So indeed.
Rachel Vancil: Our M&A.
Rachel Vancil: The benefit in the first quarter will be.
Rachel Vancil: Mid to high single digits, perhaps.
Rachel Vancil: And accordingly, that's very satisfactory since we're aiming for overall revenue growth, we're managing the quarters.
Rachel Vancil: Not for one of these elements that go into it but overall revenue growth so it'll be that'll be that'll be reasonable for us and that.
Rachel Vancil: That fits our cadence M&A will then have a moderate impact a bench.
Rachel Vancil: Benefit in the second quarter, and then it'll fall off in Q3 and Q4 as all of these things both by that'd be organic.
Rachel Vancil: Got it that's helpful. And then just for my follow up just regarding Chinese stimuli.
Rachel Vancil: Mentioned that you had $15 million.
Speaker Change: Orders in the back half of 2024 can you walk us through what are you assuming in terms of benefit from China's stimulus into the 2025 guide versus what would be upside and then also just where are you seeing orders either from a provincial level from a product level and any color that would be helpful. As well. Thanks so much.
Gerald Herman: Rachel It's Gerald I'll take the Hello.
Gerald Herman: On the stimulus orders we have in the in the guide we would simply assume that it's first of all we did see some.
Gerald Herman: Improvement in some of those orders in the fourth quarter 'twenty four but we are expecting to see those orders spread out.
Gerald Herman: We continue to be spread out in the first half of 'twenty five so we expect to see more in the first quarter. For example in 'twenty five and then the benefit itself from a revenue perspective to mostly hit into the second half of 'twenty five and into the first half of 'twenty six.
Gerald Herman: So those are already essentially baked in but I think we've not assumed substantially large numbers in those cases, largely due to the delays.
Gerald Herman: <unk> seen and continue to see with respect to modest levels are baked in.
Gerald Herman: And we're not about to prematurely harvest potential higher levels because of NIH uncertainty. So maybe maybe that'll end up offsetting itself, but remains to be seen we've baked in.
Gerald Herman: In an isolated world, we've probably been quite conservative on China's stimulus being baked in.
Gerald Herman: Or because of other uncertainties that we're all aware of.
Gerald Herman: Okay.
Gerald Herman: Hope that helps.
Gerald Herman: Yes.
Tycho Peterson: The next question will come from Tycho Peterson with Jefferies. Please go ahead.
Tycho Peterson: Hey, thanks.
Tycho Peterson: A couple on guidance as well I guess, the 2% to 3% from M&A could you maybe just delineate between nonrecurring I know that had been running below plan can speed had been running above plan and then <unk> are you seeing synergies with the multi business there yet and then also gerald expectations for further back.
Tycho Peterson: Backlog reduction and 25 potentially bringing that down and are you guys, assuming a reversal of the import export restrictions.
Tycho Peterson: And then lastly, Frank semi could accelerate from here I think you've got new gateway architecture, replacing Finfet theres not a lot more sampling and process steps needed, maybe just talk a little bit about whether semi could actually pick up from here.
Speaker Change: So yes, non Australia is doing okay. I mean, it's not quite running at the $10 million per month $120 million run rate little bit lower but you know, maybe it's running at $110 million or so and that's in a year remember when of course, we all remember were biopharma was relatively weak and often that tends to be one third of nano string revenue and that was just a week or two.
Speaker Change: So we expect that to pick up where we don't expect nano string to go back yet in 'twenty five to it.
Speaker Change: Three chapter 11 levels, but we expect nice growth in nano string as well as in cellular analysis. This year <unk> is just chugging along it's just so I got to have never had such a predictable business. Its good. It has as you may recall from JP Morgan It had more placements of instruments.
Speaker Change: Year than we had expected that bodes well for these instruments, then coming up to full speed and having the consumables pull through by.
Speaker Change: Maybe the middle of this year, so that theyre doing great <unk> speed is doing better than expected.
Speaker Change: Semi so strong already and it is on such a good trajectory I don't know that it would further accelerate but I also mean to your point, maybe you don't expect any.
Speaker Change: Deceleration in our semi portfolio. So it's just a delight and it's been a good growth trajectory with terrific margins.
Speaker Change: And I missed something on import export I apologize what was the question.
Speaker Change: Are you assuming that gets unwound.
Speaker Change: The restrictions.
Speaker Change: I'm sorry.
Speaker Change: So we have certain semi restrictions on China, theyre not going to go away those were already implemented two or three years ago.
Speaker Change: For very high performance equipment that you cannot export to China, that's completely baked in as of years ago and these other these other more recent stuff that came out just in early January.
Speaker Change: None of that affected us.
Speaker Change: And so therefore.
Tycho Peterson: It wont go away Tycho, but only because it doesn't affect us these instruments, mostly I'll do bottom up proteomics and the few instruments that we have that do top down proteomics, they come from from Switzerland, or Germany, So theyre not theyre not affected directly.
Speaker Change: Okay, and then can you comment on that.
Speaker Change: <unk> dynamics and then also I had people asking about the first quarter operating margins it looks like they're pretty soft so could you touch on that as well. Thanks.
Speaker Change: Yes.
Speaker Change: Right.
Speaker Change: So as we said we think the cadence will be that operating margin improvements will be more and not back not only back half and in the Q2 through Q4, So Q1 will be.
Speaker Change: Not as strong on operating profit margin that is correct simply though simply because.
Speaker Change: That's still mathematically a quarter, where the nano string dilution is new to us.
Speaker Change: Year over year.
Speaker Change: Last Q1, 'twenty four I'm, stating the obvious or we didn't have nano screening and so therefore, it didn't have a dilutive effect yet so it's it's honestly. It's just math there is nothing more than that in there. It's just how the math comes together.
Speaker Change: Okay.
Speaker Change: With respect to your question on backlog and 25, we're not assuming any significant change I mean at this point to be blunt about it we've talked about dragging that backlog down over multiple years, and our order performance, particularly in the fourth quarter.
Speaker Change: Just made that challenging.
Speaker Change: <unk> mentioned earlier and a good way so.
Speaker Change: We haven't been able to bring it down significantly because of the order.
Speaker Change: That's the puts are the take I don't know, which it is but if NIH was really just terrible for the rest of the year and there was no new political consensus of Hollywood redeploy those savings into our research infrastructure.
Speaker Change: And then maybe uncertainty would be the biggest problem right. I think we have that we're sitting on that extra two months of backlog cushion that we'd like to not use up this year. We don't think we will.
Speaker Change: But that that comes down a little bit this year as five yes.
Speaker Change: And and also baked into this a little bit.
Speaker Change: But we're not expecting to go from 7% to five months, but.
Speaker Change: But thats kind of the that's the free variable that we can choose to come down by half a month or by a four months. This year, depending on how order patterns are that's why we are in.
Speaker Change: The unusual position to where we can we have that other steering wheel that we can that we can that just nicely contracts any other uncertainty.
Speaker Change: Great. Thank you.
Speaker Change: We can take one more question.
Speaker Change: The next question will come from <unk> <unk> with Guggenheim Securities. Please go ahead.
Speaker Change: Hey, guys. Thank you so much for taking my question.
Speaker Change: Thank you mentioned 10 stores to the new product launches is back on track and are you seeing most growth in terms of geography, given recent macro funding.
Speaker Change: Especially in the U S could you lay out what your loss.
Speaker Change: Sports It is in the U S. And then what is assumed in the journey.
Speaker Change: Yes.
Speaker Change: Yes, Tim stuff.
Speaker Change: So indeed, yes, we have.
Speaker Change: Signaled that the team's omni will be launched ultimately at ASML, but sometime this year that's sort of.
Speaker Change: And unusual new field of Proteoform analysis within mass spectrometry. So.
Speaker Change: Hope that we will have.
Speaker Change: Our launch this we're sure pretty sure we're confident with that we have a launch this year hopefully at ASM S. There will be other improvements that for competitive reasons, we don't want to pin that right now, but there's a lot in the pipeline.
Speaker Change: Graphic contribution on Tim staff is not that unusual it's obviously U S. Heavy in Europe heavy but there is a meaningful contribution also from Asia Pacific, China, But also Japan Korea.
Speaker Change: Korea stimulus package, that's now coming along Biopharma and Biosciences as part of that we're also benefiting from the battery part another driver of strength.
Speaker Change: So it seems tough had been suffering also a little bit from weaker biopharma funding. So we think that may begin to gradually reverse this year, so that might be another driver that lifts all boats.
Speaker Change: Maybe maybe that's and there's a lot of that Biopharma funding tends to be primarily in the United States.
Speaker Change: A lot of it in Europe, a lot of it in Asia Pacific, but the U S is clearly leading their hope that helps <unk>.
Speaker Change: So that means NIH funding is probably not going to just have an isolated effect on spec.
Speaker Change: One thing you said intellectual.
Speaker Change: That's certainly not stopped donlin should anybody about something else or is this what you are doing to tackle that it's manufactured elsewhere not in the U S.
Speaker Change: Did you say did you use the word interacciones.
Speaker Change: Yes.
Speaker Change: Okay interact with different from top down a lot of people use bottom up approach it all mix.
Speaker Change: So you look at protein protein interaction interact film is also very much studied by MMR.
Speaker Change: Ara high field MMR.
Speaker Change: The.
Speaker Change: Approach here.
Speaker Change: Anyway, I think the without getting into too much scientific detail.
Speaker Change: On the financial call none of that none of this matters all of these instruments. None of these instruments interact to them is not top down so those are separate but either way none of this none of this restricts any of our products that for these type of applications are all made in Europe.
Speaker Change: Perfect. That's all I wanted to hear.
Speaker Change: Thank you for asking.
Speaker Change: Alright, great.
Speaker Change: Of time now.
Speaker Change: Yes, Sir this concludes our question and answer session I would like to turn the conference back over to Mr. Joe Costco for any closing remarks. Please go ahead.
Speaker Change: Thank you for joining us today brokers leadership team looks forward to meeting with you at an investor event or speaking with you directly during the first quarter feel free to reach out to me to arrange any follow up have a good day.
Speaker Change: The conference has now concluded. Thank you for attending today's presentation you may now disconnect.
Speaker Change: Okay.
Speaker Change: Okay.
Speaker Change: Okay.
Speaker Change: Yeah.