REE Automotive Ltd. (REE) on Q4 2021 Results - Earnings Call Transcript
Operator: Greetings and welcome to the REE Automotive's Fourth Quarter 2021 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the opening remarks. As a reminder, this conference is being recorded. I would now like to turn the call over to Limor Gruber, Vice President of Investor Relations. Thank you. You may begin.
Limor Gruber: Thank you, and thank you all for joining our fourth quarter 2021 conference call. We hope that you have seen our press release and investor deck issued earlier this morning at investors.ree.auto. I would like to remind you that today's call may include forward-looking statements. Any statements describing our beliefs, goals, plans, strategies, expectations, projections, forecasts and assumptions are forward-looking statements. Please note that the company's actual results may be different from other anticipated by such forward-looking statements for a variety of reasons, many of which are beyond our control. Please see our recent filing with the SEC, which identify the principal risks and uncertainties that could affect our business, prospects and future results. We assume no obligation to update publicly any forward-looking statements except as required by law. In addition, we will be discussing or providing certain non-GAAP financial measures today, including adjusted EBITDA, non-GAAP net loss and non-GAAP EPS. Please see our release and filings for a reconciliation of these non-GAAP measures to their most directly comparable GAAP measures. Joining me today is our Co-Founder and Chief Executive Officer, Daniel Barel, who will provide an overview of our business and give an operations update, as well as our CFO, David Goldberg, who will continue with the discussion on our financial results and outlook. At this point, I will turn the call over to Daniel. Daniel, please.
Daniel Barel: Thank you, Limor. Good morning and welcome to our fourth quarter 2021 earnings call. I will begin the call with an update on the company's progress on our many strategic initiatives and discuss milestones achieved in the last few months. Then our new CFO, David Goldberg, will follow with a recap on the financials of the fourth quarter and our outlook. Finally, before we open the call for your question, I'll provide a brief overview of our technology and vision for the future, for listeners who may not be as familiar with REE. The last several years have been busy and exciting for REE as we accelerate our path to production in 2023. In 2019 and 2020 before REE was a public company, we were focused on validating our technology and setting up our supply chain. These were of course critical as couldn’t engage major global counterparties without the technology and capabilities to deliver on our promise. Moreover, the measure we have taken in the past couple of years to build and enhance our supply chain and vendors' network positioned us well to mitigate the global supply chain issues. Though I believe that tight market conditions will moderate by the time REE starts commercial production. This past year was transformational for the company. We entered into strategic collaborations to develop designs and prototype to support various applications and build the right ecosystem. Together with our strategic partners, that enables us to start accepting orders by the end of 2022 and produce in 2023. As a horizontally integrated business, REE's agnostic vehicle size, shape, power source and driving mode. Our products are designed to be operated on either battery or fuel cells and in any drive mode, both human driven an autonomous, while affording complete design freedom to our customers. Through our collaboration with leading partners we are well positioned on the demand side to deliver full vehicle to customers while remaining focused on our core business of corners and platforms. Our agreements with OEMs and body manufacturers allows us to tap into existing customer base and these automotive leaders. For example, through our strategic collaboration with EAVX, the EV focused business unit of J.B Poindexter and Company, will target the fast growing U.S. walk-in van market via a joint sales team. J.B Poindexter is the leading producer of walk-in van bodies in North America with more than 50% market share. We have also partnered with American Axle & Manufacturing, a leading global automotive supplier of driveline technologies to supply a compact, high-performance, three-in-one electric drive unit in EDU, which we have developed together during the past three years. REE plans to leverage American Axle's system integration capabilities and focus on noise, vibration and harnesses reduction to incorporate American Axle's lightweight and efficient next generation electric drive unit into the REEcorner. The REEcorner and the REEboard are designed to be manufactured using a novel manufacturing model. The components will be manufactured by our partners and suppliers via multiple production lines around the world, feeding a global network of integration centers owned and operated by REE. REE's CapEx light manufacturing approach and integration centers enable us to remain a comparatively asset light enterprise. This means not only faster time to market, but also secure supply chain capacity and quality control. Our partnership and collaboration not only allows us to go to market quickly with full vehicles, they will also position us to develop a comprehensive ecosystem of enabling capabilities and services, such as vehicle financing, charging infrastructure, after sales and service and Data-as-a-Service for a full turnkey solution that will enable and expedite smooth and scalable transition for our customers from ICE to EV fleets. As an example, in December, we announced a strategic partnership with Hitachi America, a subsidiary of Hitachi Ltd. to co-create a highly scalable Data-as-a-Service and Analytics-as-a-Service platform, which is expected to provide operational efficiencies to our customers through intelligence and analytics across the lifecycle of the vehicle. It could also provide REE with an opportunity for subscription based revenue. We are working on other collaborations that support our go to market plan, and aftermarket service. These relate to financing an EV charging infrastructure, and we look forward to sharing more information in the future. I cannot overstate the importance of REE's ecosystem as it is fundamental to our business. These are all critically important steps as we are not just buying components or implementing third party technology. We are jointly developing key capabilities together with our partners. Importantly, in doing so, we believe we have created a path to dramatically streamline the transition to electrification of the automotive industry. A great example for this would be a strategic development agreement we signed in mid 2021 with a leading global commercial OEM to jointly develop Class 4 commercial EVs, and jointly take them to the market in the U.S. With our supply chain and partners ecosystem foundation we continue to aggressively execute on the timeline previously provided. We are targeting completion of prototype validation by our customers on non-public road, and obtaining firm orders towards the end of the year. Following that, we expect to validate advanced prototypes on public roads and obtain purchase orders. During 2021, we made a significant progress toward commercialization and production capabilities in anticipation of prototype trials and ultimately production. We established and staffed REE's Engineering Center of Excellence in the UK to accelerate engineering design, validation, verification and testing, as well as homologation in the state-of-the-art facility. REE is focused on building its highly automated launch factory and first Integration Center in Coventry, the UK in 2022 and plans to open its first asset-light Integration Center in Texas, which is expected to be operational in 2023. We anticipate initial capacity to produce 10,000 vehicle sets by the end of 2022 ramping up to 20,000 vehicle sets by the end of 2023. All these things set the stage for the activities we are undertaking this year to tie to our anticipated timeline for commercial production in 2023. Regarding our existing programs, we are focused on Commercial Vehicles segment of the market, including light commercial vehicles, delivery vans, and trucks and mid duty commercial vehicles. We're focused on this segment because of the rapid electrification of commercial fleets, and the differentiation of our modular approach, which ultimately leads to lower total cost of ownership for our customers, a compelling value proposition to any skilled commercial enterprise. As I mentioned earlier, our platform is indifferent to vehicle size, shape, power source and level of autonomy. So the potential application is broad and future proof and can be deployed across fleets of varying vehicle classes. P7 program. Most recently we started trials of our new P7 modular platform designed for commercial delivery vehicles and walk-in vans. The P7 enabled unmatched efficiencies for fleets offering a low, fully flat chassis for vehicles in classes 3 to 5 and approximately 35% more cargo space for a given footprint, all with optimized total cost of ownership. REEcorner can be integrated into full vehicles or chassis and our approach can meet electrification need across customers. Electric and autonomous vehicle built on top of REE's P7 seven platforms are designed to achieve driving ranges up to 370 miles, with max speed of 80 miles per hour and supporting payload of 8800 pounds. For fleet owners needing full vehicle solutions, REE can deliver future proof mission specific design with a network of global automotive partners. Upfitters and other manufacturers looking for full design freedom can also take REE's stripped chassis or chassis cabs for maximum dimensional flexibility for speciality equipment. We have a number of ongoing P7 programs with several counterparties. One is based on the functional and operational specification of a major global logistics company, including their product validation and durability cycle. We expect this customer to test a full vehicle prototype on private roads in the U.S. in mid 2022. The other two programs which I mentioned earlier, are our strategic collaboration with EAVX to which we started to send prototypes for upfitting advanced top hats for private road validation in mid 2022. The other is our joint development agreement with a major commercial vehicle OEM with which we developed a class 4 electrified platform for commercial trucks, school buses, walk-in vans, and recreational vehicles. During the joint development phase, REE and the global commercial vehicle OEM expect to enter into supply agreement for REE to supply it REEcorner for a dedicated new EV chassis. We expect to start providing full vehicle prototypes to our pipeline customers in the U.S. and the UK for private road validation in mid 2022 with first orders expected towards the end of the year. The FlatFormer program. Our collaboration with Hino Motors, a global leader in heavy and medium duty trucks is progressing as well. Together with Hino we jointly exhibited our concept modular EV platform, the FlatFormer at the Consumer Electronics Show in Las Vegas this past January. The FlatFormer leverages REE's innovative REEcorner technology, which allows the entire drive components to reside within the wheel housing between the wheel and the chassis, thus creating a fully flat chassis. The FlatFormer is capable of carrying a customized Mobility Service Model that can carry passengers, goods and delivery services. The Mobility Service Module can be easily detached from the EV platform and once detached can serve as an independent standalone unit leaving the platform to be operated separately and continue on its next mission. REE and Hino anticipate that FlatFormer prototype will be produced in 2022. The Leopard program. Finally, in November, we unveiled an autonomous concept vehicle based on our modular EV platform design, based on interest from potential customers for such a vehicle of this nature. The full-scale concept is geared for customers including delivery fleet operators, e-retailers, and technology companies seeking to build fully autonomous solutions according to their exact specifications and with unmatched interior space for transporting passengers and cargo. Since leopard, were initially presented, the company has received significant interest and intends to produce a proof of concept vehicle for the customers by the end of 2022. Before I hand him the call, please allow me to properly introduce our new CFO, David Goldberg, and welcome him to the REE team. As you may have seen, David recently joined us from Magna International, where he most recently served as Senior Vice President of Corporate Development. We're counting on David to lead all aspects of REE's financial functions, strategic industry partnerships, and investor relations. I'm highly confident that David will have a tremendous impact on the company as we execute this critical path of our business plan. David?
David Goldberg: Thank you, Daniel, and good morning, everyone. I'm excited to be here with you on this call today and even more excited about the opportunities that lie ahead for REE. REE has developed groundbreaking technology that I believe will revolutionize the EV market. We have a truly unique approach to the market opportunity and I'm certainly joining REE at a pivotal stage in the company's growth plan. I look forward to getting to know REE shareholders, as well as our analyst community over the coming quarters, and commit to providing transparency into our financial results and plans going forward. First, I'd like to discuss the company's results for the fourth quarter, then focus on our expectations for 2022, and share my perspectives around those expectations. The company reported a GAAP net loss of $46.7 million in the fourth quarter of 2021 compared to $414.9 million in the third quarter of 2021. As discussed last quarter, the third quarter results were impacted by $394 million of expenses related to the vesting performance based stock options granted to the company's founders prior to its merger with 10X Capital. Non-GAAP net loss of $26 million in the fourth quarter of 2021 increased compared to $19 million in the third quarter of 2021 as we continue to ramp our programs and add the technical and engineering staff required to meet our anticipated timelines. As of December 31, the number of employees was 270 on a full time basis, and that compares to 84 at the beginning of the year. As of December 31, 2021, our cash balance totaled $275.8 million comprised entirely of cash and no debt. We have sufficient funding to execute the programs Daniel described earlier, as well as to advance other R&D efforts that are underway. For 2022, we have budgeted at a range of $130 million to $150 million in cash spending, inclusive of both capital and operating expenses. I should note that we present this range on a cash basis as it is primarily tied to the execution of our current programs. The path to production is never a straight line, but we are providing our internal budgeting plans to maximize transparency. Due to REE's asset-light model, we expect to invest close to $30 million in 2022 mainly related to the establishment of our production capability, which will be concentrated in our UK launch factory and Integration Center as well as our Austin Integration Center. This portion of the budget is effectively committed and enables REE to execute against its expected timeline. Our OpEx plan is mostly comprised of technical and engineering spend required to execute our programs according to the timelines we have communicated. With reference to my earlier comment on our budget being on a cash basis, it's important to note that if certain milestones get pushed out in time, some costs will get pushed out as well. Similarly, if MOUs or other pipeline opportunities convert to agreements or existing programs expand in scope, spending may accelerate and we may require additional liquidity to deliver against those opportunities. We are very focused on executing our current programs, but of course have ambitions that extend far beyond given the total size of the addressable market. Having said that, the vast majority of our budget is allocated towards our current programs. The cadence of our spending plan will be indicative of our progress and we will update our shareholders on budget expectations as the year unfolds. And with that, I'll hand the call back to Daniel for additional comments.
Daniel Barel: Thanks, David. Before opening the call up to questions, I'd like to touch on REE's competitive positioning in what has rapidly become a very vibrant and active EV market. As I've said before, the manufacturing process for vehicles hasn't changed significantly in decades. This applies to both vehicle powered by combustion engines and electric vehicles. As the adaptation of electric vehicles accelerates, the main difference in manufacturing is the substitution of an internal combustion engine for an electric one. The components are still between the wheels and on the chassis, which constrains modularity and functionality. REE has fundamentally different approach to easy design and manufacturing. Our REEcorner patented technology integrates critical vehicle components, like steering, braking, suspension, powertrain and control into a single compact module located between the chassis and the wheel. Our fully flat platforms are designed to serve as the foundation upon which EVs are built. This means our platforms are designed to provide greater interior space and volumetric efficiency than conventional vehicles built. This translates into more cargo carrying capacity, whether cargo means people or shipping boxes. And that means lower total cost of ownership and higher return on investment for our customers. Because our products are modular, they are widely applicable to vehicles of all class types, and completely agnostic to shape, power source or driving mode. That's why we can build the P7 and the Leopard without a decade of R&D in between. Our approach is also future proof in that we are able to continually improve upon our modules without rebuilding the design from the ground up. While we do not intend to get ahead of our business plan, and are squarely focused on executing it, I can't help but imagine the opportunities that lie ahead and I would like to express my gratitude to our partners and stakeholders that share this vision.
Operator: Thank you. We will now begin the question-and-answer session. Your first question today comes from the line of Greg Hills BTIG. Please go ahead, your line is open.
Unidentified Analyst: Daniel, am I on the line, I'm not sure if that's for Greg Lewis or not?
Operator: Your line is open, sir.
Unidentified Analyst: Okay, great. Hey, hey, hey, good morning, good afternoon everybody.
Daniel Barel: Hi Greg.
Unidentified Analyst: Thank you for the updates. I guess I was kind of curious, as I think about the company this year, clearly 2022 is going to be a big execution year for you. Could you walk us through some of the key steps as you see them are hurdles as we think about the homologation process, which is, I guess, expected to start here in the next few months?
Daniel Barel: Right. So one, yes, absolutely I agree 2022 is very important here and we've got a lot of plans for it. The main steps that I think we should look for, for 2022 would divide into two categories. One on the demand side and one on the supply side naturally. Were you referring to both or just to the supply side homologation?
Unidentified Analyst: Yes, correct.
Daniel Barel: So on homologation, it's a process right? So U.S. and Europe homologation are slightly different and we're making progress for the past few years with homologation of our technology. We expect to be fully homologated and on the road ready to be handing over SOP on time in 2023. In the U.S. naturally it, the process is slightly different than in Europe, where in Europe you have a governing body that oversees it and we are making a lot of progress on both those fronts. We have not identified any hurdles at this point that would take us off course in homologation. So currently everything is expected to proceed on schedule and on track.
Unidentified Analyst: Okay, great. Okay, great. And then realizing that the P7 is going to be, being sold into you mentioned that either for battery, electric battery vehicles as well as fuel cell vehicles. At this point, do we do we have any kind of feel? Is there more customer interest for fuel cell over a battery electric vehicle? Just trying to understand that, just because as we think about it at least, while we are bullish on fuel cells, longer term it seems like battery electric solutions are kind of here and now.
Daniel Barel: Yes, I tend to agree. Batteries are here and now and also batteries is a variety, and I think this is one of REE's strong points because we're agnostic to power source. So not necessarily just between batteries and fuel cells, but also different kinds of batteries, different chemistries, solid-state batteries, and other. Our approach is that we are agnostic to batteries, meaning that we can accommodate different kinds of batteries from multiple suppliers and multiple chemistries and configurations. That gives us a lot of flexibility in two main fronts, one in terms naturally of technology and performance in the market, but not only that, but it gives us a lot of hedging against shortage in supply. Having said that, we do see demand for fuel cells, but that demand is usually what we see is located more towards the high end of the vehicle class, the longer range, more heavy side of the business. But again, I think that's the second step if not the third step down the road.
Unidentified Analyst: Okay, so I mean, not to put words in your mouth, but it sounds like the bulk of demand that you're seeing, as we start to think about 2023, and 2024 is more for electric vehicles as opposed to fuel cells?
Daniel Barel: Correct.
Unidentified Analyst: Okay, perfect. Thank you very much.
Limor Gruber: Thank you.
Operator: Thank you. Your next question comes from the line of Andres Sheppard from Cantor Fitzgerald. Please go ahead, your line is open.
Andres Sheppard: Hi, good morning Daniel. Can you hear me okay?
Daniel Barel: Of course, good morning.
Andres Sheppard: Good morning. How are you? Congrats on the quarter. A couple of quick questions from me. So you have mentioned that you expect P7 platform orders towards the end of the year. I'm just wondering if maybe you can give us a bit more color in terms of the order flow and the revenue that could translate to and how do you see that ramping up in 2023?
Daniel Barel: Sure. So, first and foremost we are a tech company right? And our tech enables mission specific vehicles. Those vehicles are best suited for customers in terms of efficiency, uptime and TCO. Now, those customers need to experience the tech and its benefits. And after they experience the tech and benefit, that would lead to firm orders, which basically means converting our large pipeline to backlog and that's the plan for 2022. So we have started already at the end of 2021 to provide customers with prototypes for evaluations and we've reported the first one last year and we will continue doing so in 2022. Once those customers have experienced the technology, all of its benefits and the strong differentiation, the next phase would be for them to place those same orders to allow us to move forward.
David Goldberg: And I guess just to add another point, work capacitizing for revenues in 2023. So the orders that would come in towards the end of this year, we're going to have 10,000 or capacity for 10,000 sets beginning in 2023.
Andres Sheppard: Got it? That's very helpful. Thanks, guys. May be one quick followup. I'm wondering if maybe you can give us an update on the 20 total customer programs that you had referenced in the past, any changes to sign agreements or the pipeline?
Daniel Barel: Yes, we continue to make progress on that and we continue to develop that pipeline. I do think that for 2022 onwards the more important index for us to be focusing on would be converting it into firm orders. So as well as we are continuing to build that pipeline and growing and bring in more partners, and we've also, of course, shared with you earlier today, that mid last year, we've signed with a very large global commercial OEM for Class 4s. So that is going to continue growing, but again, I believe that the conversion of the pipeline into backlog is what we want to focus on this year and get towards the end of the year, that's I think the important factor for the company to execute on.
Andres Sheppard: Great, thanks very much, Daniel. I'll pass it on. Thank you.
Daniel Barel: Sure.
Operator: Thank you. Your next question comes from the line of Jeff Osborne from Cowen. Please go ahead, your line is open.
Unidentified Analyst: Hey, guys, this is Shawn for Jeff Osborne. Good afternoon.
Limor Gruber: Hi, how are you?
Unidentified Analyst: Hey I'm good. Good afternoon, guys. Thanks for taking my questions. So for the first question, I'm seeing that the UK Integration Center is now coming online in 2022 as opposed to the initially planned 2023. So can one infer from that, that you're seeing faster demand growth in Europe for delivery or is it going to be delivered somewhere else? And can you perhaps talk about like what kind of vehicle categories are you seeing there?
Daniel Barel: Yes, so you are correct. We have moved faster on our European Integration Center to accommodate demand from Europe. So we will have two integration centers up and running for the production of 2023, one for Europe, and one for the U.S. We are building our integration centers in a very disciplined way, where we are focusing on having them close to strategic customers. The whole idea behind our CapEx light and asset-light manufacturing strategies, we were able to set up those integration centers rather quickly within 10 to 12 months from commissioning close to key customers and adding the incremental volume as needed.
Unidentified Analyst: So is there a particular reason why the European one is coming in ahead of the North American one, just kind of going off your timeline it seems like the first delivery would be in North America right?
Daniel Barel: The first delivery will be the P7 program. The P7 is a very modular platform. Right? It's aimed at delivery companies, top hat builders, few OEMs, autonomous shuttles, et cetera. That program is on track, and we see a rather global demand for it. So it will be available both in Europe and the U.S.
Unidentified Analyst: Understood, thanks so much. And just as a follow up, I saw Navya last week announced that they're joining moving on, so can you perhaps touch upon in where you are in your autonomous development with Navya and like perhaps in general? And like from a revenue standpoint can you mention like how or what fraction of your revenue is coming in from autonomous in the next few years?
David Goldberg: So, I mean, our near term focus is actually not on level four or five autonomy. We see that as a really significant opportunity over the long-term. But the near-term is very much tied to vehicles with drivers.
Daniel Barel: Now, nonetheless, of course, it's all by wire and the REEcorners and REEboards are wire system. Therefore, it's perfectly suitable for autonomy. But, like David just said, we think that in terms of go to market timing, autonomy is a little bit further away, both in terms of regulations and volume. So our main focus is the humanly driven or should we say P7, but the P7 yes, can be also driven autonomously.
Unidentified Analyst: Got it. Thank you so much guys, I appreciate it.
Limor Gruber: Thank you.
Operator: Thank you. Your next question comes from Mike Shlisky from DA Davidson. Please go ahead. Your line is open.
Michael Shlisky: Yes. Hey, good morning, guys or good afternoon, I should say. I wanted to ask quickly, yes sorry, I wanted to ask quickly first about the sales process, you had mentioned, I think it was for EAVX and the global OEM that you’re also working with. What really has changed, it sounds like you guys have jointly, it sounded like your comments that you were jointly selling those vehicles to the end user. That seems like a different approach than I heard before where you'll be allowing the OEM and of course the EAVX to be the person facing the end user. Did they interpret that, or are they still responsible for the final sale, or are you going to be more involved now?
Daniel Barel: Yes. I don't think there is a change in what we've communicated before, since our strategy and philosophy that we complete, we do not compete. So therefore, our partners are a very important factor for us in go to market and we developed technology together. And the fact that we're able to work alongside body builders like EVAX and Poindexter and, as well as a few OEMs, is very unique to REE. Nonetheless, by working with them, of course, we are at times becoming the differentiator for them in the market, all the way up to certain points, where in few programs there is actually a very strong customer pool I mean from the customers asking a certain OEM or a partner to work together with REE and provide them with a holistic product based on power battery. So, the strategies remain the same, it just expands as we go.
Michael Shlisky: Okay, got it, got it. Thank you for that. I also want to ask maybe a two-part question here about the supply chain situation facing the globe today. In 2022, do you have a large number of products that you plan to make? Is it only a few dozen vehicles, or is it in the hundreds, or is there any sense that you've got the kind of quantities that might be a challenge for any of your suppliers to deliver for the current year?
Daniel Barel: We don’t see any challenges in developing prototypes this year. Quite a bit of that supply chain has already started last year as well. We have been gearing, we’ve been, I think, very disciplined in bringing up our supply chain for the past two years and building up the consumer/customer base and pipeline. So, we’ve got everything we need in order to put vehicles on the customers, a full vehicle that is on the customers this year in order for them to experience the technology and its benefits.
Michael Shlisky: Great. And the other part of that question is about building up the Integration Centers, Austin and the UK. Do you have any issues with actually obtaining the equipment that you need to install or is there still plenty of time before you actually need them to be functional?
Daniel Barel: So yes, both Austin and Coventry in the UK are on track. There are no delays that we see. Keep in mind those are integration centers, assembly lines, so they're relatively asset-light. There are some robotics and AGVs, which I think that we would love to invite you guys over, hopefully, in the summer to experience those and see how it looks like. We have signed the agreements that we need, we have the capacity and robotics and equipment that we need for those centers. Having said that, like David said, the SOP is expected in 2023, so those will be operational towards SOP, probably even beforehand.
Michael Shlisky: Okay. I'll leave it there. Thanks so much, Daniel.
Daniel Barel: Thank you.
Limor Gruber: Thanks Mike.
Operator: Thank you. There are no further questions on the phone lines. I will pass the call back.
Limor Gruber: Thank you, Sharon. Before we conclude, I would like to read questions from the platform, the Q&A platform that we launched last quarter. And this question the investor would like to understand our go to market strategies better. So here goes, is the company having an actual order anytime soon or is it keeping with partnership?
Daniel Barel: Yes, I think the answer to that is something along the lines of what we've said before. As we explained earlier, we expect to get initial firm orders by the end of the year and that's after our pipeline customers validate a full vehicle prototype powered by REE, experience the technology and its benefit. This process would enable us to convert our current, rather large pipeline into backlog and that's the -- I think that's the approach we've been communicating time over time again for everybody, so that's also on track.
Limor Gruber: Thank you, Daniel. Thank you very much everyone. Looking forward to touch bases. Bye, bye.
Daniel Barel: Thank you, all.
Operator: Thank you. This concludes today's conference call. Thank you for participating. You may now disconnect.
