Freightos Ltd Q4 FY2022 Earnings Call

Hi. Welcome to Freightos' 2022 Fiscal Year Earnings Conference Call. My name is Eytan Buchman, and I'm the Chief Marketing Officer at Freightos. A press release with detailed financial results for fiscal year 2022 was released a few minutes ago, and is available at freightos.com/investors. There, you can also find our investor presentation and other related material. Today, I'm joined by Zvi Schreiber, the CEO of Freightos; and Ran Shalev, Freightos' Chief Financial Officer. During the call today, Zvi will discuss key strategic and business achievements from 2022. He will be followed by Ran, who will provide our full year 2022 financial results. He will then return to Zvi for 2023 guidance. Following the prepared remarks, we will open the call to questions. Please be aware that today's discussion contains forward-looking statements, which are subject to a number of risks and uncertainties. Actual results may differ materially due to various risk factors. Please refer to today's press release and our SEC filings for more information on risk factors and other factors, which could impact forward-looking statements. Copies of these reports are available online. In discussing the results of our operations, we will be providing and referring to certain non-IFRS financial measures. You can find reconciliations to the most directly comparable IFRS financial measures in the press release, along with additional information regarding these non-IFRS financial measures. The company undertakes no obligation to update any information discussed in this call at any time. We recommend using Zoom's desktop or mobile applications to submit questions during the course of the call. If you are using the Zoom Client, questions can be submitted in writing during the call by using the Q&A feature. If you'd like to ask a live question during the Q&A portion of this conference call, please click 'raise your hand.' If you are dialing in from a phone, and not using the Zoom app, you can raise your hand to request to speak by pressing star 9 on your keypad. With that, let me please introduce Dr. Zvi Schreiber, the CEO of Freightos.

Thanks, Eytan, and thank you all for joining our very first earnings call. As you can see from the results, we have had a strong year of growth and continue to execute successfully on the strategy, which we presented in our prospectus, when we went public just about six weeks ago. Since this is our first earnings call, let me start with a quick reminder of what we are about. At Freightos, we are digitalizing the international freight market. Global trade is about 23% of the world economy and an estimated 90% of products purchased in the west are imported. So it's a huge part of our economy and of our lifestyles. The third-party logistics industry, which includes air and ocean shipping of goods, is worth over $1 trillion. But this vast and critical industry is surprisingly offline, creating tens of billions of dollars of waste and the offline highly intermediate nature of global freight is a factor in all the supply chain problems experienced in recent years. At Freightos, we are pursuing the same business strategy that was so successful in digitalizing passenger travel, retail, and other industries. The strategy of being the vendor-neutral digital platform that connects industry players. A central function of our platform is being the marketplace that matches buyers and sellers of freight services. Now, the power of a two-sided marketplace is the flywheel effect. Buyers attract sellers and sellers attract buyers. This flywheel can create decades of sustainable defensible growth at a very low cost of growth. We have actually taken it a step further. Freightos has a three-sided marketplace, connecting carriers like airlines and ocean liners, freight forwarders, and importers or exporters. I'm happy to report that the numbers show that we have successfully created a marketplace flywheel. Although we may still be small in terms of revenue, we believe we have created the dynamics and foundation to grow fast now, and to continue to grow with excellent capital efficiency for many years to come. So how do we track that growth? In common with most marketplaces, we consider the most important measure of our progress to be the volume of transactions that are booked on our platform. The two primary KPIs we will typically report on and guide on are the number of transactions and the value of transactions, which we call gross booking value. The number of transactions is the purest indication that our platform is growing. The number of transactions on the Freightos platform grew 154%, reaching nearly 670,000 bookings in 2022. The value of these transactions, gross booking value or GBV, grew by 102%, reaching $611 million. In terms of GBV, we had a headwind in that freight prices dropped sharply in the latter part of last year, and even with that, our GBV more than doubled. So our marketplace is growing fast. We'll drill into that more later to show you why we think this is a sustainable marketplace growth flywheel. But you're probably, and rightly, wondering about revenue and profit. We earn fees on almost every transaction on our marketplace. Depending on the type of transaction, it's either a flat fee or a percentage of the transaction value. Our revenue overall grew by more than 70% year over year to about $19 million. Now we operate in two segments: platform and solutions. I would emphasize that our platform segment revenue doubled from $3.3 million in 2021 to $6.6 million in 2022, partially from acquisitions. Going forward, you'll see our platform revenue growing as the number of transactions and GBV increases and as our monetization capabilities improve. We'll talk about the solutions segment soon, but first two important points about our marketplace. We really have excellent capital efficiency. Our sales and marketing spend on the platform is less than 2% of the GBV, and it's trending even lower. Other marketplaces spend much more than that to fuel growth, with some B2B marketplace leaders spending upwards of 5% of GBV on sales and marketing. Some marketplaces have poured billions into promotions to buy growth. But Freightos is growing its platform organically based on buyer and seller demand with modest spending on customer acquisition. And secondly, we have excellent unit economics from an operations perspective, better than many mature marketplaces. In 2022, we achieved a platform gross margin of 37% or 45% on a non-IFRS basis. A significant improvement over 2021, so our platform revenue is producing a healthy gross profit and that gross margin keeps improving. As for our second segment, our growing solutions business consists of software as a service subscriptions, data subscriptions, and related services. This is strategic in that our solutions actually support platform use. For example, freight forwarders can use our software to automate their routing, pricing, and quoting to their customers, which readies them to sell electronically on our platform. Our solutions segment doesn't have the same growth flywheel as the platform, but it is growing and it's a profitable business. In 2022, we sold $12.4 million in solutions, mostly recurring software as a service subscriptions with a gross margin of 73%. So if both our platform and solutions are generating healthy gross profits, you may be wondering why we aren't yet generating a net profit and free cash flow? And the answer, of course, is that during this growth stage, we've made a strategic decision, together with our board of directors, to prioritize investment in our product and in our growth. We spent over $10 million on Research and Development last year and almost $13 million in sales and marketing as well as G&A expenses. That's really a small investment compared to the size of the opportunity that we have, and the investment is really paying off in spades. You can see the trend last year; our gross profit grew by 67%, but our total operating expenses, excluding IPO transaction costs, only grew by 42%. Provided we continue the underlying growth, it's inevitable that our gross profit will exceed our expenses and we will become a profitable company. And as the growth continues further, a highly profitable company. So if you're invested in Freightos and are betting we become a large, highly profitable company, I think the main thing you will want to verify is that the growth of our transaction volume is sustainable. So let's drill down on our platform transaction growth. Firstly, we have seen substantial growth in the number of transactions on our platform every quarter for 12 consecutive quarters. Overall, quarterly transaction volumes are up 28 times from the first quarter of 2020. To verify that we have a supply-demand-supply flywheel, we publish two more KPIs: the number of carriers, that is, the number of air and ocean carriers selling on our platform, and the number of unique buyer users buying on our platform, which includes the number of unique individuals at importers, exporters, or freight forwarders who are logged in and make a booking. On the supply front, we've been continuing our efforts to bring leading carriers, primarily airlines online and to connect them to the thousands of freight forwarders on the platform. The total number of airlines on the platform reached 35 in 2022 with some initial growth in ocean liners as well. By the end of 2022, our platform boasted airlines representing over 50% of global air cargo capacity, including some leaders that are only available on our platform like China Southern Airlines and Emirates SkyCargo. I think it's a huge milestone to have airlines representing more than half of the world market available on our platform. Though the vast majority of air cargo is still booked in practice offline, but that actually means there is still a huge growth opportunity. To give you some context, just five years ago there was zero air cargo available electronically. Moving on from supply, we continue to expand demand on the platform. The number of unique individual business users booking for services on our platform rose from about 11,000 in the fourth quarter of 2021 to almost 16,000 in the fourth quarter of 2022. Even better, on average, each unique user placed 18 bookings in Q4 2021, and 43 in Q4 2022. That's more than double the transactions per user. In fact, there are at least five large countries in Europe where our data indicates that over 10% of all air cargo shipments are booked on web cargo by Freightos. So the marketplace flywheel is alive and well; supply is attracting demand and demand is attracting supply. Finally, a word about the state of the freight industry. Freightos has actually become a leading publisher of indexes for the freight industry, so we're well positioned to comment on industry trends. We published the FBX index of container shipping rates. You can find FBX on your Bloomberg screens. You could even trade futures of the FBX index on the CME and Singapore's SGX. Or you can see more granular data at data.freightos.com. The headline FBX global index is down more than 80% from a year ago. FBX 01, the Bellwether Transpacific Index, is down a staggering 94%. Our Freightos Air Index FX Global shows that air cargo prices are also down some 25% from the market a year ago. In addition to prices being down, volumes are down too. Now, to a large extent, this massive adjustment is simply a reversion to pre-pandemic prices and volumes, but it still represents a dramatic drop in price levels, and a drop in volume too. So I think it's a wonderful testament to the strength of our platform that we are able to project strong growth this year, even in an industry that is going through a contraction cycle. And with that, let me hand you over to our CFO, Ran, after which, I'll be back to talk about 2023 briefly.

Thanks, Zvi, and thank you to everyone joining our first annual report. One thing that is clear from what Zvi discussed is that we demonstrated our capability to scale in a capital-efficient manner. One of my main focal points as CFO of Freightos is to ensure that every single metric in every department is trending towards more efficiency as we scale. Freightos is unique in the international freight tech sector in that we are a scalable platform, not a logistics provider, which allows us to scale without massive headcount increases. We are unusual compared to many platforms in that we are scaling to capital-efficient growth rather than in buying market share. By continuing with these principles and always driving for economies of scale, we ensure that we become highly profitable once we reach a certain scale. Here is a brief overview of our 2022 annual results. Revenue for 2022 was $19.1 million, an increase of 71.7% year-over-year, or 76.2% on a constant currency basis. This growth includes an integration of two businesses, which we bought, Gesher and 7LFreight, which we acquired at the end of 2021 and early 2022, as well as organic sales growth. Our IFRS gross margins were 58.8% compared to 58.7% in 2021. Our non-IFRS gross margins were 65.2% compared to 60.5% in 2021. These improved margins are a product of our economies of scale and constant drives for cost efficiencies through automation. Our adjusted EBITDA in 2022 was negative $14.6 million, compared to negative $12.4 million in 2021. As a proportion of our revenues, this is an improvement from negative 107% in 2021 to a negative 77% in 2022. There is another indication that as we scale, we are constantly trending towards profitability and positive free cash flow. I want to assure you that we are managing our expenses very carefully and we expect to reach profitability with the cash we have already raised. Let me hand back to Zvi to give some more context for our 2023 guidance.

Okay. So what about 2023? As mentioned, the freight industry has started this year with volumes down and prices down by tens of percent. Even so, our underlying platform growth is so strong that we expect the number of transactions to grow by over 50% this year, to exceed a million in transactions. At GBV, platform revenue and platform gross profit are all expected to grow, although that growth will be modest because of lower freight prices and volumes. Still, even with the freight industry going through a contraction phase of its business cycle, 2023 should see revenues increase to between $22.3 million and $23.6 million, and at the end of 2023, we will have even more supply, more demand, and more liquidity in our marketplace. And we will, of course, be a year closer to the milestone of profitability and positive free cash flow. The freight industry is cyclical, so volumes and prices are expected to recover at some point, giving us a nice tailwind. Overall, we continue to execute on one of the biggest business opportunities in today's world, becoming the digital platform for international freight. With that, I'll turn you back to our CMO, Eytan.

Our first question comes from Brian Dobson of Chardan. Next, we have a question from George Sutton of Craig-Hallum. It looks like Brian is back, so I will hand it over to him.

Can you hear me?

Yep, we can hear you.

Hi. I guess my first question is, can you just compare the similarities and differences relative to the digitization that took place in your industry versus the OTAs?

That's a complicated question because these are different industries. There are some similarities, I guess, that are easy in the sense that the carriers that we work with in many cases are the airlines and also the ocean liners. But some of the most important carriers we work with are airlines. And it's the very same airlines who sell on the OTAs. Most cargo travels on airlines, which are also passenger airlines, like American Airlines and Qatar, et cetera. So in that respect, the carriers overlap, and the supply overlaps in terms of who the supplies are. Now, as you go to the sort of the intermediaries, there are some similarities; a travel agent has some similarities to a freight forwarder, but freight forwarding is really a lot more complicated because when you buy an airline ticket, you walk yourself onto the plane, you walk yourself off the plane, cargo doesn’t do that. So, people are much less quick to try to disintermediate freight forwarders because they have a much more complicated job. They have to get things to the port, from the port, and through customs brokerage. So it's just a rather more complicated function. And then, of course, when you get to the end customer for the OTAs, the end customer as a consumer in most cases could be a business as well, of course. But it’s sort of I believe the majority of the business there is B2C, whereas our customers are always businesses. They may be small businesses, but we only work with professional importers and exporters as the end customer. So overall, I think they have in common that there's a lot of supply and a lot of demand and it changes, and there's a massive opportunity for a marketplace kind of play. So that's why we do use that as an analogy. And I think it's a useful analogy. But as you hinted in your question, it's not a perfect analogy. There are certainly differences as well. Does that answer your question?

And then just one more, I know you gave a lot of color, which I appreciate on the penetration of existing accounts and KPIs you're focused on. But can you just kind of discuss the take rate a little bit and sort of the growth outlook if any over the next couple of years? How should we think about that?

Yes. That's a great question, and the answer is slightly complicated. The reason for that is that we have a couple of segments within our marketplace, which have different levels of take rate, and the good news is in both major segments. One is freightos.com, which is used by the end customer, by the importers and exporters. The other major part of our marketplace is web cargo, which is connecting freight forwarders to carriers. So we've got those two major buckets of transactions, and the take rates long-term are increasing in both of them. So it's always going in the right direction. The thing that complicates it slightly is the mix. So freightos.com is already more mature and has a higher take rate. Web cargo is newer, it’s growing much faster, and it has a lower take rate. So even as the take rate improves over time in both of those parts of the marketplace, the mix is shifting to web cargo, which is growing faster, but still has a lower take rate. That's why you will see this year, and Ron, correct me if I say something wrong, but I think the take rate will be largely similar this year compared to last year, order of magnitude. But that actually hides the fact that underneath the take rate is actually improving in both parts of the marketplace. It’s just the mix, which means that you don't see that improvement. But over time, as we grow, we're really seeing a great dynamic; as we grow, people value our marketplace more. It’s a more important channel for the sellers, and it's a more important procurement platform for buyers. We definitely see that over time, we're adding more and more value, and that allows us to extract a bigger fee over time. So, the trends long-term is definitely towards a higher take rate.

Okay. And our next question here is from George Sutton of Craig-Hallum.

Zvi and Ran, congratulations on your first call. I’d like to discuss the air carrier side first. It seems there will be natural growth as you handle larger shipments. Can you elaborate on that in relation to your market position? Additionally, on the ocean side, I believe you are beginning to see increased interest due to market challenges. Could you explain those dynamics?

Sure, yes. Thanks, George. So, I think that's right. I mean, if you look at the air market, first of all, we're adding more carriers. We added several big carriers in the last year. We mentioned in the press release that we now have carriers who account for more than 50% of the world market. Still, they’re doing a lot of offline stuff. But what you also said is correct; there is a trend where a lot of carriers, when they first digitalize, they say, 'Okay, only up to 500 kilos.' That's just about 1,200 pounds or 1,100 pounds. But then they increase it as they get confidence in digitalization. Then they say 1 ton, 2 tons. Some carriers have already started to offer refrigerated shipments, which is a higher value service. So there is a trend that as they mature, we get a mix of some bigger shipments or more specialized shipments. Having said that, as I said, obviously in my comments and those of you who know the industry, this is not a positive part of the natural business cycle. I mean, the rates are down in air and ocean more dramatically, but also air rates are down and air volumes are down. Fortunately, digitalization continues to pace. We are managing to grow nicely last year, and we are predicting growth this year even though the market is going through a down cycle. So that will be the issue. When you look at the numbers for this year, yes, there is some trend that we are starting to get bigger shipments or more special shipments. But overwhelming that is the fact that rates are down. And so you will see — we plan to grow the number of transactions over 50% this year even in a down market, which is great. But the value of the transactions, GBV will lag behind that because of the cyclical drop in the industry, which we are going through now. And then who knows? Maybe next year, we are on an up cycle and we get a tailwind from the cycle.

As we when we started talking a little over a year ago, the market was on fire. So the competitive landscape was a big question mark. I'm just curious with the market very different today. Your relative position would be particularly more impressive. Can you just talk about the competitive dynamics that you are currently seeing?

I think that's right. I think also you hinted in your first question; you asked about, I think I didn't really address the second part of that ocean versus air. So air, like you said, digitalization has now got fantastic momentum. Ocean was tougher last year, and I think part of the reason was that, the ocean liners that ships were full. They were overfull. They were charging $20,000 at one point to ship a container transpacific. Now it's about $1,000, just to give you an idea. And there was little appetite for innovation amongst the ocean liners when the market was so hot. Now, of course, things are different; the ships are struggling a little bit to fill their ships. There are more ships on the order book, and rates are much, much lower. So I believe there will be an improved appetite this year for the ocean lines to digitalize.

And then in terms of your follow-up question on competition, look, we are fortunate. This is not an easy task that we are taking on, and it has attracted remarkably little competition. I don’t want to say there is no competition. There are people competing with parts of what we do. But in air bookings, which is our biggest part of our platform, we are by far the leader, and we have got a leadership position in other segments as well. So this is a complex, conservative industry. It took — let's be honest, it took us many years to get to the momentum we've got to. This was not something that could be done quickly. This industry doesn't have digital infrastructure that I was asked before about the OTAs in travel. But in travel, there was, as I've said before, they will say when I'm a digital infrastructure, which allowed the OTAs to come on quickly and compete with each other. We do not have that same dynamic in freight. The barriers to entry are much, much higher. We have been fortunate that, I believe that we have even pulled further ahead. In fact, I have data to show that our substantial lead over competition has even increased further in the last few months.

Great to hear. One other question if I could. Can you just talk about the payments beta launch and progress you are seeing there?

Yes. Payments are an important part of our strategy, and this relates also to the other question about take rates. So payments are one of the ways that we improve our take rate. We are able to — the other way, as we grow, we become more valuable. We have value-added services; we provide data. There are many ways we can become a more valuable channel for the sellers. But handling payments is also a very substantial way of monetizing. It's easier to monetize and extract fees when you're handling the payments. It adds more value. We're able to take care of issues of cross-border credit and foreign exchange, which are big issues in our industry. So, it’s still — because it’s still at an early stage, we're not publishing specific numbers. But I can tell you that there's been good growth. It's, in fact, exceeded our expectations in the last few months, and I hope that going into next year, it will be big enough that perhaps we'll report specific numbers on that.

Our next question comes from Jason Helfstein of Oppenheimer.

Few questions, I'll kind of ask some one at a time. So first, how are you thinking about solutions, the percent of revenue mix over the next two years?

Well, the solutions will grow, but it will reduce as a mix. So we've always said that we see ourselves primarily as a platform company, and the reason for that is what I spoke about in my opening remarks; that marketplaces, platforms, and specifically platforms, which are marketplaces, which are matching supply and demand have a very strong growth dynamic that they've got this network effect and that they grow like a flywheel. We're experiencing that especially with the airlines, but not only. Therefore, it's kind of inevitable that over the years, the platform revenue will grow faster than the solutions revenue and become a higher percentage of our revenue.

And then maybe just talk about how you're thinking about terminal margins, terminal EBITDA margins, and how large does revenue need to be to reach terminal margins?

Well, you can see that our gross profit margin, Ran, just jump in with the exact number, the non-IFRS gross margin that we —

65% in IFRS for 2022.

So, we're already at 65%. So, that gives you an idea. Our other expenses grow slower than revenue. The cost of goods sold, of course, by definition, pretty much grows together with the revenue. But our other expenses will be growing slower. G&A will normally grow slower. This year we've got the cost of being public. So, that's sort of additional cost, which we have from this year onwards. But other than that, we've always been able to grow our team less quickly than our gross and number of transactions. You can base on that, the terminal. Where we break even is when the revenue at 65% of the revenue covers our expenses.

And then maybe last question, Uber is talking about spinning off Uber Freight as an independent company. Do you think there's any impact to Freightos if that happens, positive or negative? And just maybe for investors, because they're maybe new to this area, how do you think about the Freightos business versus the Uber Freight business?

It's a good opportunity to clarify for those who are not in the freight industry. Although Uber used the word freight, and we used the word freight, we’re talking about two separate industries. So, we're discussing international freight, primarily air and ocean. And they’re talking about domestic trucking. Now there are touchpoints between those industries. Those are — let's say, sister industries or adjacent industries for sure. There’s some overlap because once the container gets off the ship, it has to go on the truck. So there's a little bit of overlap in touchpoints. But by and large, these are two separate adjacent industries, the domestic trucking and air and ocean. Now, Uber Freight is just one of multiple marketplaces for domestic trucking, excuse me, transfix is another and several others. The barriers to entry for being a marketplace for domestic trucking in the U.S. or indeed another country are not as high. It's all in dollars. It’s all zip code or zip code. And there are a few competitors there. I'm not saying it's easy, but there are a few competitors there. We specialize in the adjacent industry of international air and ocean, which is rather more complicated. It has to be global by nature and comes with a lot less competition. So yes, we welcome whether spun off or not. We're finding the way. We don't see it as a competitor. We see them as a potential partner for sort of the last mile. And it's always good to see similar models succeeding in adjacent industries. Does that answer your question?

Okay. Our next question comes from an unidentified analyst.

My first question is that I see in the outlook that compared to your forecast back in June 2022, your outlook for 2023 in terms of revenue was almost cut in half. I just want to understand, which portion was cut in terms of comparing between the marketplace and the data service? And secondly, potentially this question has been asked already, but I just want to understand what is the key competitive advantage that Freightos has over other platforms such as Flexport, which would be the key to Freightos success? Thanks.

Sure. Thanks, Dan. So let me take those in order. If you compare to June, the revenue was cut significantly, and the primary reason for that, as you can imagine, is a very, very dramatic change in our industry. Ocean rates are down at sort of 90% since June — from June till now in less than a year, air rates are down probably 25%. In addition, volumes are down. So the industry has obviously changed beyond recognition. I’m delighted to say that we’re still growing despite that; companies like Freight Forwarder, I’ll talk about Flexport in a moment, your second question, but if I can relate the two questions, companies like Flexport, freight forwarders are actually providing a service, are talking about revenue down substantially this year. I can't talk for them specifically, but other freight forwarders are going to make — their revenues going to be down 60% or 70%. So the fact that we're able to still grow despite that, more modestly, but still grow when the industry's gone through a dramatic down cycle is great. By the way, we did give an update in October, so we already — in October already, the prices had started to drop and we updated our projections that we gave to our SPAC partners. So we already gave the markets, well, we already gave our SPAC partners, and the market was able to see the update then. But then even since October, rates have dropped in tens of percent more. As I say, that's part of the business cycle. I'm just pleased that we are able to keep growing, more modestly, but keep growing substantially even when there is such a strong down part of the cycle. Second question, slightly related. Flexport is not a competitor to us. In fact, they are our customer. I understand why you asked the question that way because Flexport is also digitalizing freight and we are digitalizing freight. But they are digitalizing freight as a service provider. They actually provide the service of shipping goods from A to B, and they’re a freight forwarder. They compete with our — they don’t compete with us; they compete with our customers. They compete with freight forwarders like Expeditors and FedEx Logistics and other firms, and we see all the freight forwarders as customers of ours because our strategy is to be a vendor-neutral platform. So we are connecting the carriers to the forwarders, the forwarders to the importers and exporters, and we are happy to work with forwarders who are traditional. We are happy to work with forwarders who are more digital like Flexport. And in any case, we don’t see them as competition, if that makes sense.

Thanks. I have just one more question. Then in your view, who do you see as your closest competitor?

So, we are taking a comprehensive approach for connecting airlines to floters, starting to cover ocean liners for floes, importers, and exporters, providing data. The reason why I mention that is because we don’t have any one competitor who competes with a whole stack, with our whole footprint. But we do have competitors in specific areas. So for airline booking, there is a startup for Cargo One who competes for the last. For data, there is a company that competes with us. So there are some competitors to different parts of it, but I think the exciting thing about Freightos is we are taking a full view in digitalizing the whole industry. And we don’t see anyone competing with our whole offering.

I see one question that came in via the Q&A section. It seems that historically a lot of growth has come from acquisitions. Can you speak about that and what we should expect going forward, both organically and potentially from acquisitions?

Yes. Look, I'll be honest about this. The acquisitions that we did have been very, very good for us. In fact, web cargo, which is a very substantial part of our business started as an acquisition six years ago. So, we have had good success in integrating acquisitions. But having said that, they were all to some extent opportunistic. We have a solid growth plan, which is primarily based on organic growth. And then if a company comes up for sale, which gives us a shortcut in a certain market or a certain technology segment, we're always looking out for that. We're pleased that we've done that now three times successfully, and that means we have the skills to source and create a deal and integrate acquisitions. But it's always hard to predict which companies will be available to buy at a reasonable pricing. Therefore, we don't make that a central part of our growth strategy that just presents an opportunity to — when that comes up, it's an opportunity to take a shortcut and grow even faster.

Okay. Well, I'm seeing no more questions here. I'd like to thank everybody here. A recording of this webcast will be available on our website at freightos.com/investors. And before we conclude, I'll just turn the floor back to Zvi for a final comment.

Great. Well, really good to have everyone on the call. I think what we're doing with the help of our investors is something very exciting. We're really taking a very big, very important industry and digitalizing it. I think we'll need a bit of patience this year because the industry goes through its cycles. This year is going to be so far looking like a down cycle, but we're growing despite that. I'm very pleased to have you all on board. Thank you.

Thank you, everybody. That concludes this call.