Transat A.T. Inc.

Hi, everyone. And welcome to the Transat conference call for the presentation of the financial results of the first quarter ended January 31, 2020.

I’m here with Jean-Marc Eustache, President and CEO; Annick Guérard, COO; and Denis Petrin, CFO. Denis will review the financial results and we will then answer questions from financial analysts.

Questions from journalists will be handled offline. The conference call will be in English, but questions may be asked in French or English.

As usual, our investors’ presentation has been updated and is posted on our website in the Investors section. Denis may refer to it as he comments.

Today’s call contains forward-looking statements. There are risks that actual results will differ materially from those contemplated by those forward-looking statements.

For additional information on such risks, please consult our filings with the Canadian Securities Commissions. The call also contains certain forward-looking statements concerning a transaction involving the acquisition of all the shares of the corporation.

These statements are based on certain assumptions deemed reasonable by the corporation, which are subject to certain risks and uncertainties, several of which are outside the control of the corporation, which may cause actual results to vary materially. In particular, the completion of the transaction with Air Canada will be subject to customary closing conditions, including regulatory approvals, particularly authorities in Canada and the European Union.

Notably, a public interest assessment regarding the arrangement is being undertaken by Transport Canada. Apart of this process, the Commissioner of Competition will provide Transport Canada with the assessment of the impacts on competition.

If the required regulatory approvals are obtained and conditions are met, it is expected that the transaction will be completed by the second quarter of the calendar year 2020. Forward-looking statements represent Transat’s expectations as of March 12, 2020, and accordingly are subject to change after such date.

However, we disclaim any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future reasons or otherwise, other than as required by the law. Finally, we may refer to IFRS and non-IFRS financial measures.

In addition to IFRS financial measures, we are using non-IFRS measures to assess the compositions of rational performance. To be likely that the non-IFRS financial measures used by the Corporation will not be comparable to similar measures reported by other issuers, all those used by financial analysts as their measures may have different definitions.

Measures used by the Corporation are intended to provide additional information and should not be considered in isolation or as substitutes for IFRS financial performance measures. Additional information on non-IFRS financial measures, such as their definition and their reconciliation with the more comparable IFRS measures are available in our annual reports.

With that, let me turn the call over to Denis.

Thank you, Christophe. Good afternoon, everyone.

We are reporting today our numbers for the first quarter for which the results are primarily driven by the sun destination program. You can read in our press release this morning, we will not make an outlook for Q2 and next summer.

I will come back to this in a few minutes. At the end, I will make some comments of the arrangement agreements signed with Air Canada.

First of all, let me say a few words on the adoption of IFRS 16 leases, the impact on comparative numbers. New standard was adopted on November 1, 2019, and 2019 figures for the entire year were restated.

Changes are described in the Note 3 of our financial statements. And summaries also available on our investor presentation .And I think there are lots of information for everyone to take into consideration by just 2019 numbers.

There are the most important changes on our statement of income. The lease expense for leases under the new standard is replaced by depreciation of a right of use asset and interest on lease liability.

The aircraft maintenance expense has decreased as major maintenance events are now capitalized and amortized where their use expected use for lives. 2019 numbers have been restated for comparison purposes.

Though it has changed the way our P&L look like, the impact on the 2019 adjusted net income versus the methodology used until last year is not very significant, $3 million decrease for the quarter and less than $100,000 for the entire year 2019. On our statement of financial position, the net present value of the future lease payments is now accounted on the balance sheet as a right of use asset and as lease liability.

As of October 31, 2019, $656 million increase in property, plant and equipment to account for the right of use assets and capitalize maintenance, and $666 million increase in lease liability. Other changes include $155 million increase in the provision for return condition for leased aircraft and engines, and $125 million increase in deposits as maintenance deposits to lessors, which were previously recorded as a reduction of the provision for overhaul of leased aircraft.

And the elimination for the provision for overhaul of leased aircraft. Finally, a $23 million increase in retained earnings as of October 31, 2019.

Globally, results for the first quarter were in line with the outlook expressed last December. For all programs combined Q1 results were as follows.

Revenue of $693 million, up $45 million, or 7%, versus 2019. And adjusted operating income of $27 million compared with an adjusted operating loss of $8 million last year.

The adjusted net loss was $20 million, compared with $39 million in 2019. On our sun destination program, our capacity was 11% higher than last year.

Margin were higher due to a decrease in airline unit costs, decrease in hotel costs and a slight decrease in operating expenses, resulting from the combined effect of fuel costs and currency fluctuations. On the transatlantic routes, margins were also higher than last year.

Globally, the increased profitability for the quarter was mainly driven by sun destination program, our main program for the winter season. Now for the balance sheet.

Corporation’s free cash totaled $682 million at the end of January versus $620 million last year. Cash interest or otherwise reserve totaled $411 million.

Our credit facilities remain unused. The deposit for future travels stood at $809 million compared with $753 million at the end of January 31, 2019.

Off-balance sheet agreements stood at $1.3 billion as of January 31, same amount then at the end of October. This amount $1.3 billion is mainly related to 15 Airbus A321neos to be delivered from 2020 to 2022.

In off-year, our booking in and compared with the same date last year. For Q2 in the sun destination, our capacity is 5% higher.

Currently 83% of that capacity has been sold. Load factor are up 1.7% -- are lower 1.7%.

And if all indicators remain stable, the combined effect of USD fluctuation and fuel costs will result in a slight decrease in operating expenses. Taking all those metrics into account, unit margin are 0.8% higher than those recorded on the same date last year.

On transatlantic program, load factor are down 1.6% and prices are similar. Half of summer, on the transatlantic program, our capacity is 3% higher.

Currently 34% of our capacity has been sold. Load factor are down 1.7%, and prices are down 5.7%.

Combined effect fuel costs and currency fluctuation will result in the 4% decrease of operating expenses, if they remain where they are. Now, since the last week of February, daily bookings have been lower than last year, and the variance has increased significantly in the past few days.

When we have seen year-over-year variances of around 50%, it is impossible to assess the duration or the severity for the coming weeks. We have taken a certain number of measures to protect our cash and we will continue to do so as the situation evolves.

Nonetheless in the current situation, again, it is impossible to predict the effect of coronavirus on future reservations. As you can read in our press release, we will not make any outlook for the second quarter and for the summer, like I said at the beginning.

Few remarks now on the transaction with Air Canada. August 23, 2019, significant majority of Corporation shareholders voted in favor of a special resolution approving the previously announced plan of arrangement pursuing to which Air Canada would acquire all of the issued outstanding voting shares of Transat forecast consideration of $18 per share.

The arrangement remains subject to customary closing conditions, including regulatory approvals, particularly those Canada and European Union. Report from the Canadian Competition Bureau is expected before the end of March.

It should be bear in mind that in the context of the public interest assessment, the Bureau's evaluation is very likely to be limited to competition challenges that the transaction may pose. The report is therefore very likely to have a negative overall tone, as has been the case in the First Air, Canadian North transaction.

No conclusion should be drawn from this as the final decision relative to the transaction. As a reminder, Transport Canada will submit their report to Minister Garneau on May 2.

This report will not be made public. The minister will then make his recommendation for the final decision.

We are still expecting the transaction to close in the second quarter of the calendar year 2020 if that requires regulatory approvals are obtained and conditions are met. In conclusion, results were better in Q1, and we were well positioned for the rest of the year.

We're not attentive to the recent developments related to the coronavirus and remain on our way to the transaction. We will now proceed with your questions.

Good day. And thank you for taking my questions.

Firstly, on the Air Canada transaction and I believe the next step is a Competition Bureau Report that you referenced. I'm just wondering how often are you interacting with individuals from Air Canada.

And is it safe to assume that discussions and your tone of exchange with them is unchanged in light of the shift in kind of the macro backdrop? Or any comments you could say there?

Thank you.

The Competition Bureau will give its report on the 23rd of March. We're expecting that the report will be factual.

So it will say, I suppose there's a competition problem. They will not give any solution, that's not their mandate.

I think the report will be a little bit tough for the transaction, but we know its part of the deal and nothing special with that. Really the transaction will be when Transport Canada will give its answer to the minister and tell to the minister the remedies that should ask and to agree or not to agree with the transaction.

So the report of the Competition Bureau that really for us nothing that we can do, and we're still a competitor with Air Canada. So we don't have any discussion about the Competition Bureau.

We do our thing, they do their thing, they do their representation that they have to do, and we do ours. So the noise – am I answering clearly?

That’s perfect. No.

That’s great. So no really ongoing discussions with individuals from Air Canada at that point.

You're both just waiting for the Competition Bureau report?

Yes. Yes.

Okay. And just secondly, I believe in the MD&A, you mentioned the 5% capacity increases in the sun designations market.

Given current conditions, how fast can you cut capacity? And how much reduction in capacity are you putting through at this point in time?

Or expect to put through just given, I mean, I think you referenced 50% reduction in bookings? So …

We are following this situation very closely and adapting our flight program carefully and making, of course, the right decision at the right time. The decision that we've made in terms of changing our program has been under short-term, so mostly on April up to mid of June.

So we were able to downgrade some of our programs. So we hadn't made significant changes so far.

We are waiting to see what's going to happen with the exception maybe of Italy, of course, where demand has gone down significantly. But we are following demand and offer at the same time – was being offered like the petition, tracking the news that are being done, and again, being very hopeful.

It’s difficult to see how much capacity will decrease at this time. But for sure, we will decrease a couple of percent.

And just last question for me. And you mentioned cost cutting and kind of how you're in a tough cash flow preservation mode.

And just wanting to get to speak about some of these initiatives, and how much -- what do these initiatives include and how much savings do you think you can pull out of such?

So as Denis mentioned, one of the first things we did is asking our employees to avoid all non-essential expenses, discretionary expenses, raising hires, delaying projects, cutting on our time, travel and so forth. So we have launched as well to reduce work week program.

We are freezing CapEx expenses, putting a lot of projects unfold, cutting and lowering commercial and marketing investments. In parallel, we have started negotiating more flexibility conditions in terms of payments with our key suppliers such as lessors.

And we are looking, of course, at every financial measure to be able to protect our cash in the weeks and months to come. Looking at where we have guarantees, where we have risk, working for several partners so that we get breaks in collaboration from them.

So first of all on the IFRS 16 impact, just want to make sure I see the numbers correctly. So I see your net debt number declined by $53 million as of October 31, 2019.

Is that the correct assessment?

We will just check that. Obviously, the methodology that is very, very different than what it used to be was calculated with a formula where today we’re were taking the numbers on the balance sheet.

Can we take this one offline just to …

Sure. Yes.

Absolutely. Thanks for that.

Yeah. Okay.

Thank you. And then secondly, you mentioned the reserved cash for future bookings that you still have to deliver.

Can you remind us what that number is on the reserve cash? And can that change or can that come down as bookings are canceled or fewer bookings are made?

Are you referring to customer deposits that we have in end for future …

Yeah. I think you mentioned some restricted cash or reserved cash, right, of $400 million or something.

Okay. At the end of January we were having something like $800 million of deposits from clients.

In one end, we could see that in our liability on the balance sheet. On the other end, what I was saying is that, at the end of January, cash and cash equivalents in our balance sheet was $682 million.

On top of this, we also have an amount of $410 million of cash and cash equivalent, interest or otherwise reserves, because some rules in different provinces in Canada, Quebec, Ontario, D.C, or a portion of cash, limited to the company has to be maintained in trust accounts or something close to this depending where we operate. Then when we look at our cash, again, we were having $682 million plus $410 million for a total of $1.1 billion.

I see. Okay.

So that's $682 million is a free cash unlike it's not the earmark for something. You can use it for CapEx, and you can use it for other kind of investments?

And we have cash interest or otherwise again reserve mainly during the winter period, because it relates to sales that are made by tour operators. Then this amount will just be reduced and already smaller than this.

And during the summer this would probably be in the magnitude of less than $200,000, $200 million, sorry.

I see. Okay.

Sales are going from to operators. Yes.

Okay. That makes sense.

Thanks.

Tour operators and travel agents.

Okay. And then on the Air Canada transaction, I just want to confirm one thing.

So I think the original terms when the bid price or the offered price was $13 per share, the terms in those agreements were, if there's any material adverse affect happens, then the purchaser or Air Canada in that case, or you guys or Transat can cancel the deal or terminate the deal or change the deal. So I think the definition for the material adverse affect is pretty wide and there's a lot of things like virus outbreaks, we have share price changes and those things.

So we're seeing some of those events here where coronavirus has happened and your stock price thus Air Canada share price has also collapsed significantly. Does that allow or does that enable the transaction to go into renegotiation again?

Or how do you think about that in terms of the impact on the transaction?

The price of the share doesn't have anything to do. The condition of the markets got anything to do, and even for dynamic disease right now.

It's outside of the deal we have with Air Canada. So there's nothing material happening right now that can change the deal as the price of the deal.

So the deal is there, and will be there again.

And any thoughts on as Air Canada continues to do their due diligence. And obviously, there might be some impact you might see from weakness in Europe and transatlantic.

Is there any sense on your governance or your kind of balance sheet, which might be part of a discussion with Air Canada in the next couple of months because of these changes?

No. There's nothing happening.

Air Canada is running its operation. We are running our operation.

We do what we have to do. And there's no discussion with Air Canada at all.

And the deal cannot change. The only thing is we go in front of the different regulatory, how to say that…

Bodies.

Bodies. And that's exceptional.

So we're waiting for the 23rd of March for the Competition Bureau. We have a good idea that what the Competition Bureau will say.

And after that, it will go to Transport Canada. Transport Canada will make its recommendation to the minister.

And the minister will give his decision to the government, and government will give its decision, it's yes, no, or it's yes with some condition. This happened once before since the change of regulation.

It’s Canadian North and First Air. And as you saw Competition Bureau said there will be no more competition, so there should not be this transaction.

And finally, the Minister of Transport said yes, it will be – we will have a transaction, but you will have to follow these, those, and this and that and that. And they took how many years we are in.

Finally they are one company and it's a monopoly to go to North of Canada. And so, we'll see what will happen.

It's a decision of the minister and the decision of the cabinet.

Okay. That makes sense.

And is it -- do you think the process is happening on time? Are there any delays because of the economic outlook changing and then Competition Bureau or Transport Canada are not able to kind of work on the deal as fast as you expected?

Or you think it's going ahead okay?

No. I think everything is okay.

And the deal should be before like they always said to us, before the government go in holidays, so end of June, like we are saying. So there's no change about that.

Okay. And lastly for me, can you quantify your exposure to Italy in terms of how much capacity typically goes to Italy and its summer months?

So we start our Italy program unknown, around April 10, with a couple of flights in which around two flights a week, and then we move up during the peak season, and we also override flights on Venice. And Venice, we start on May 1st with a couple of flights out of Montreal and out of Toronto as well.

Overall, in terms of capacity doesn't represent more than 12% of our overall program. But this is as you already know program, now that we have move – but now that we are moving capacity here and there and decreasing some programs, of course, a percentage will be adapted.

So it just wondering if you could remind us the delivery schedule for your new A321neos? And are you looking to push some deliveries in the future considering the current coronavirus outbreak?

Or you would prefer to take those aircraft on and replace older aircraft? Thank you.

So as you know right now, we have three of those aircraft within our fleet. Last one arrived during the month of February.

We are expecting three other to be able to override during summer. So we will have six in the operations during summer, and as of next winter, we will have 10.

So overall, of course, if you talk about our original schedule, there was a couple of delays as we mentioned in the past between three to six months, depending on the aircraft, but now we're pretty much comfortable with the calendar that had been communicated before Christmas. And we expect the aircraft, as I have just mentioned, so six for summer and 10 during next winter.

In terms of delaying, no, we would not do that. So just to get them on time is a lot of the work for us.

Putting a lot of pressure on Airbus to be able to deliver according to the latest calendars they provide us with. And we are always making sure that we are keeping backups in case these aircrafts would be delayed.

But so far so good and we will not take a chance to delay those aircraft any further.

Especially, in moments like that, because like Annick said in some program right now we were using the Airbus 330, and we're downsizing the program, and we continue the program with the Airbus 321neo long-range where the Airbus 330s between 230 or 345 seats where the Airbus 321neo long-range is 199. And as you know, we have some of the Airbus 330 that are going out of the fleet.

I think it’s two this year.

Two in fall.

Two in fall and two in next year. And those aircraft our deal this one.

So we could put those aircraft down the ground because the lease are not expensive, but for sure the lease of the Airbus returning one are more expensive, and they can, they're brand new. So we can fly them as much as we can.

So we've got this Airbus 321, we don't want to delay those aircraft because those aircraft, for us it's more flexible to use them, to fly them more, and because they're brand new, there will be no much money to put on the maintenance where the Airbus 320, we can downsize the aircraft, put them on the ground and thank you very much. So for us, there's no reason to delay those aircraft, to be clear.

Okay. Thank you very much for the color.

And then coming back to the transaction with Air Canada, I understand, you cannot talk with them because of a competitive reason. But I'm just wondering if you could provide a little bit more of color around your view of Air Canada is desired to pursue this transaction?

I mean, just to come back on the previous question, now that the market is kind of in a little bit of a panic mode with the coronavirus. I just wanted to have a little bit more details on your view of the transaction?

Thank you.

Yes. I'm not in the shoes of Air Canada.

And I will have difficulties to answer for the Air Canada. Air Canada is doing its thing.

But it doesn't mean because we have a problem for a period of time like what it is right now, and it seems that it's going all over the ways this problem, when I’m listening on one side, the President of the U.S, when I'm listening the Prime Minister of Quebec, and everybody wants to do something. And I'm sure they are right and they are taking a good decision.

But you will not be a problem, I suppose, for the next 10 years. So -- and I think the deal between Air Canada and Transat anyways, for me it’s a long-term deal, and it's not the short-term.

We will not take a decision for the next six months. They are taking this decision for the next 10 years.

And as you know, this deal is a good deal for the two parties. It's a good deal for Canada, and it's a good deal for Transat.

Transat is bringing a name. It is bringing people that have knowledge, especially in the leisure market.

Even if the leisure market right now is suffering, it will come back. It will not be there, I suppose.

But the design we said in French, I don't know how to say that in English. But it's a long-term deal.

So I don't think they look at it like, okay. Today we are in a big problem, Transat has a big problem, all the airline business has a big problem worldwide.

And so we're not going to take this deal, and we are not going to continue the deal. That's my impression.

But really, you have to ask Air Canada to [indiscernible] that we are not.

You’re sort of partially answered my question, I guess, earlier. But just pointing about your ability to ground aircraft with relatively limited expenses, I think you mentioned that the four A330s that maybe are on some more favorable lease terms.

Is that the really the kind of the extent of it? Or are there some other aircraft out there that have some terrible lease terms that you can park and not have significant costs associated with those?

At all the Airbus 330, not the new one, but all of those aircraft are with low leases. So at the end of the day, we could put 2, 3, 4, 5.

I don't expect that and I don't want to do that. That’s not -- but we did it before.

And in 2001, if you remember, we put 25% of the fleet on the ground. And if it's necessary to do it, we'll do it today or tomorrow, not today, but tomorrow.

And at the end of the day, you will not be big, big expenses. And second, like we did in 2001, we went to see all the lessors Transat, and Transat doesn't know old airplane.

The only one that we own are the old Airbus 310. And those aircraft are ending at the end of this month.

We will put them on the ground. Some of them will still be used as backup, if necessary, and the rest will disappear.

So we will go and see the lessors. It’s part of what we're doing right now.

And we will ask the lessor to say, okay, I cannot pay you this price, especially for Airbus 321, right now, so you ask to give me a break. And the last time we did it, they all give us a break.

At the end of the day, six months after or nine months after, you have to pay the difference for sure. And you have to pay also the interest for that.

So I'm sure that today, and right now, you got 100 airlines going to see the same lessors that we're going to go and see them. We start to have discussion with them.

And we're going to see them asking for a break. And they will give us a break because they have no choice either.

And at the end of the day, for us, it's a way that we keep the cash and we continue to operate. So it happened before, they beat us, and it will happen this time again.

Maybe that follow-on, and I get the sense that the airline industry is looking at the situation that they're facing now is something worse than the great recession. And you've heard a lot of U.S.

airlines say maybe even worse than 9/11, just which I think is pretty remarkable. You talked what you did back in 2001.

Does it feel like you'll need to make greater adjustments than you've seen, maybe over the past two black swan events to your company, whether it's a financial crisis of 10-plus years ago, or 9/11 of 12 years ago? And like if you're going to ground 60% -- it ends up being grounding 50%, 60% of your fleet like -- is that a solution that makes sense as an operator to ground so much of your fleet?

I guess I'm just trying to figure out like at some point, I guess, the math doesn't work, right? Like if you take out too much capacity because your network isn't as robust.

You don't have the ability to deploy as many places like there's got to be a limit in terms of how much in ground fleet or just -- it just doesn't make sense anymore.

Listen. How I can answer it.

I've been in the business. I don't want to -- seems to -- I'm old for sure.

And it's 42 years I've been in the industry, and I've been there for the past 42 years. We saw different things and we adapt ourselves to all those things.

Today, how much is the problem? I have no idea at all.

I'm like everybody, looking at it and react to that. The only thing I can say is I went through all those things.

We did all that we have to do. We will do it again.

We have good employees. They have been there for years.

They know the organization. They adapt themselves.

So this business, we will do what we have to do step-by-step, day-by-day, and we will. If we have to ground it, half of the fleet, that's something that we want to do.

It's not something that we're expecting to do today. But if we asked to do it, we will do it, and we will go through.

And we have some cash. And for sure, I suppose, the governments will help us, and they have to do it.

You know when we see the tax that we pay, when we see how much the airport will pay to use those airports, when you see everything that's we're paying. Tomorrow all those guys will not have the customers that they have today.

So they will have to do their part too. And we will all do together, and we will go through that step-by-step.

I'm not a designer, like I said, I have no idea what will be tomorrow. But we'll adapt and we'll go through.

And I will be there, I suppose, for the next conference in June, because the deal will not completely finished. It will be finished by the end of June.

And I will tell you, I will be there and answering to your question. And for us, it's very easy because we can adapt ourselves very fast -- very, very fast.

You know its leisure. The people of leisure, they took the decision, they travel, they don't travel if they don't travel.

We have to put the plane on the ground, we put the plane on the ground. We have to lay off people.

It's not something that we want to do, it's not something I like to do, we will do it. We are very, very agile.

And we never went through financial problems at the end of the day. So we are very agile.

And like I always said, tourism goes bad situation. And after Transat, and we will survive, guarantee that.

And you will see it.

That's helpful. Maybe on that point, a lot focus has been on people canceling flights, and I guess, fearful of traveling today.

I'm wondering when you look at your web traffic, do you see people looking further out and maybe looking to rebook maybe outside of the normal booking curve, is this maybe greater confidence that we find a solution after coronavirus here over the next quarter or two. And that gives you a little bit of comfort that people are maybe just pushing out that potential spend, maybe they're not spending it this summer.

But you can kind of see them that maybe they’ll spend that dollar in the winter or next spring. Do you have that visibility on your website to see that consumer behavior?

What we're seeing right now is that, well, first of all, we are still receiving bookings. So people are still booking for the summer season.

But a lot of people, as you mentioned, are postponing their trips. They're calling they change their decision on the web.

They are postponing their trips to either another day or they're choosing other destination as well. And we are offering them the flexibility to be able to change their vacation.

What we are observing in terms of web is that there's a lot of last-minute booking being done by a particular segment of the population. We are seeing youngest people that are talking about getting the big deal ever and deciding to go on vacation and decide at the very last minute.

So, of course, we are looking at the sky until right now and seeing how can we better attract them? These are trends we are seeing.

We are also in discussion with Google to understand where Canadian, what kind of search they're doing, for which period of the year. Of course, in the short-term, there is much less overhauls for Canadian, much less research.

But there is more around peak season, around July and August, except, again for the youngest where we see a trend in the short-term. So this is overall what we're seeing.

Okay. That's helpful.

And I'm sure it's too early to or if you have any color on this. I think I've seen in the press as well that maybe it was usual on Marc talking about the government may be needing to step into help the overall airline industry.

Just wondering, if there's anything you can share or anything you're looking for, specifically from the government as this issue continues to kind of push forward here?

Did you listen to the conference of Minister Garneau [ph]? He said that he is going to help everybody.

And we're receiving. And the governments, federal and provincial, are already calling all the Airlines, I'm sure, for help for sure.

And telling us that what do you need? Where are we can help you?

How are we can help you? How we can help you to go through this bad time?

So everybody is on board right now and we're working with them. And we'll, I'm sure -- we're going to have help of them, because tomorrow they will have 1,000 and 1,000 of people unemployed and it will cost a fortune.

So they're going to have this, and they are doing it? So I cannot say that they are not listing.

They’re even calling us before we call them to help us. So I'm pretty sure that they will be there, and we will find solution because it's just very, very special situation.

Thank you everyone. Let me just remind you that our second quarter results will be released on June 11, 2020.

Thanks you very much. And have a good day.

Thank you very much.