Earnings Call Transcript - PSNY Q2 2024

Operator, Operator

Good day, and thank you for standing by. Welcome to the Polestar Q2 2024 Results. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Bojana Flint. Please go ahead.

Bojana Flint, Investor Relations

Thank you, operator. Hello, everyone. Bojana Flint here from Polestar Investor Relations. Thank you for joining our results call today covering the second quarter of 2024. I'm joined by Per Ansgar, our CFO, who will give the financials and business update. We will then open for analysts and retail investor questions. But before we start, I will cover some housekeeping points as usual. I would like to remind participants that many of our comments today will be considered forward-looking statements under U.S. federal securities laws and are subject to numerous risks and uncertainties that may cause Polestar's actual results to differ materially from what has been communicated. These forward-looking statements include, but are not limited to, statements regarding the future financial performance of the company, production and delivery volumes, financial and operating results, near-term outlook and medium-term targets, fundraising and funding requirements, macroeconomic and industry trends, company initiatives and other future events. Forward-looking statements made today are effective only as of today, and Polestar undertakes no obligation to update any of its forward-looking statements. For a discussion of some of the factors that could cause our actual results to differ, please review the risk factors contained in our SEC filings. In addition, management may take references to non-GAAP financial measures during the call. A discussion of why we use non-GAAP financial measures and a reconciliation to the most directly comparable GAAP measure can be found in the appendix of the press release and in the Form 6-K published today. With that, I would like to turn the call over to Per. Please go ahead.

Per Ansgar, CFO

Thanks, Bojana. Once again, I would like to welcome you all to this earnings call. We meet again seven weeks after our Q1 release, and hopefully, you have had some restful vacation weeks in the meantime. As you know, yesterday, we announced that we have a new incoming CEO, who will join us for future earnings call. But before I go into and cover the financials, I would definitely like to take the opportunity to publicly and personally thank Thomas for his immense contribution in shaping Polestar into the innovative and forward-thinking company it is today. Thomas is and will remain an iconic legend at Polestar. We wish him the best for the future. Also I want to welcome Michael Lohscheller, incoming Polestar CEO. He brings over 25 years of experience in the automotive industry, particularly in scaling businesses. And you will have the opportunity to meet him in upcoming calls later on. So, now, let me turn to the financials. I plan to give an update on the Q2 results, both in relation to Q1, as it is important to check our progress through 2024, and on year-over-year comparisons for consistency. And talking of progress, of course, I'm very pleased to say that we recently filed our audited results for 2023 on Form 20-F and we are now back on track with our more normalized reporting calendar. And by that, we have cleared the reporting deficiency we have had with NASDAQ. In the coming weeks, we aim to publish the usual documents, the management discussion and analysis and the IAS 34 report. With that, let me start with the key movements Q2 versus Q1 of 2024. We saw global vehicle sales of 13,150 cars, up more than 80%. Revenue was up close to 70% to $575 million and gross result was a small negative at $4 million versus Q1. The improvement in gross result was driven by Polestar 2 volume growth as well as initial deliveries of Polestar 3 and some normalization of revenue recognition at our China joint venture. Our underlying gross profit was still impacted by higher discounts on Polestar 2 in a very competitive market and before we ramp up Polestar 3 and 4 deliveries. We are managing selling, general and administrative costs tightly and seeing the benefit of our cost measures that we introduced in mid-2023 and early 2024. Compared to more than 80% volume growth, the SG&A in the quarter was up just 6%, a good result, which also bore the extensive advertising activities for Polestar 3 and Polestar 4 global launches. Overall, the operating loss increased $18 million to $242 million. Moving on to the second quarter of 2024 versus second quarter of 2023, I would like to flag the key movements. Revenue decreased $118 million or 70% due to lower global volumes and higher discounts. Gross results were similarly around breakeven as the impact of lower global volumes and higher discounts was offset by two factors, which was an impairment release and some normalization of the revenue recognition related to the sales of cars to the China joint venture. SG&A expenses were down $33 million or 13%, with cost management actions. Research and development decreased $36 million or around 75%, mainly due to Polestar 2 IP amortization now being capitalized in inventory and therefore being part of our cost of goods sold. Other operating income decreased $32 million, primarily due to foreign exchange effects. Operating loss decreased $32 million to $242 million. Moving on to cash flow highlights. At the end of the period, we reported $669 million of cash and cash equivalents on the balance sheet as we continue to manage cash very prudently. In mid-August, we also secured up to $300 million of new external money. Operating cash outflow of $166 million since December, including a positive inflow in the second quarter, was less than the operating loss as management actions drove improved working capital. As guided in our Q1 results, we expected to see lower working capital relative to sales and we have in this quarter released some $300 million, mostly inventory, and this trend will continue. It is fair to say that we ended 2023 with inventory higher than what we wanted or anticipated, but we took action and we have seen improvements in 2024 and especially in the second quarter. Investing cash outflow of $354 million was in line with plans, and we direct our investments towards Polestar 3, 4, and 5. Financing cash inflow was a net increase of $441 million with proceeds from $950 million club drawn facility fully utilized. However, we also made some repayments of other loans and trade financing facilities, which are now largely undrawn and ready to deploy as we scale up volumes. Let me finish with the outlook where the picture remains for stronger volumes in the second half and particularly going into the fourth quarter. Sales momentum seen in the second quarter has had a positive impact on inventory levels and cash flow, and we will continue to work hard on this. Like I said on the last call, I am a bit of a freak. I like working with cash flow. I think this is very fun and obviously, it's very important. I firmly believe that there are a lot of things that can be done on this front. Let's now leave the financials and move into the recent business developments. We saw a significant uptick in deliveries in the second quarter compared to the first quarter. Our sales team has really accelerated their efforts and worked well with our retail partners to ensure we have a strong platform to build upon in the second half of the year. Following the global media test starts with Polestar 3 and Polestar 4, the organization is now gearing up for regional media activities and we are seeing growing demand for test drive slots and adding new capacity all the time. Polestar 4 started deliveries in Europe just a few weeks ago. The SUV coupe is already showing us how important it will be in our model lineup, with its design, power, and stance attracting a wide customer base. We are continuing to develop our marketing efforts with the exciting Polestar 4 campaigns. Those of you who have seen the pole vaulter Armand Duplantis and the swimmer Sarah Sjöström, two of our most decorated Olympians and global superstars, are now driving Polestar 4 as our brand ambassadors. We are very proud of that. One of the most important recent milestones for Polestar was the start of production in South Carolina of Polestar 3. This makes Polestar 3 the first Polestar manufactured on two continents. It supports our commercial ambition in the U.S., where we have always known how important it is to have a large luxury SUV that is built locally. Producing cars in South Carolina diversifies our manufacturing footprint and strengthens our competitiveness as a whole, as we can export Polestar 3 to Europe and benefit from a more balanced trade in and out of the U.S. The first South Carolina-produced cars are being handed over to customers in the next few weeks. As we grow our model lineup and look to expand our geographic footprint, we are putting significant effort into maximizing the value and efficiency of our existing distribution footprint. We have now several European markets operating under the non-genuine agency setup with more to come and new partners being brought on board. This enables us to engage and involve our space investors, increase conversion and ultimately sell more cars in a more efficient way. To wrap this up, we have created a strong momentum in sales with more than 80% improvement in the second quarter. We have engaged our sales force and they are now really gearing up for the later part of this year. Operationally, with three cars in production across two continents and, financially, with 30% higher inventory turnover, driving cash and working capital improvements. And with this, we are confident of a stronger second half, particularly from the fourth quarter sales of the two premium SUVs built.

Operator, Operator

Thank you. The first question comes from Tobias Beith from Redburn Atlantic. Please go ahead. Your line is now open.

Tobias Beith, Analyst

Hi, good afternoon, Per and Bojana. Thanks for taking my questions, and good to chat again. I have three questions, please. And as usual, I'll ask them separately. Are you able to provide some more detail on the sequential improvement in COGS per external unit? I identify a 14% reduction, which is quite notable.

Per Ansgar, CFO

Thank you, Tobias. We are actively focused on reducing our costs, with several components contributing to this effort. Currently, the majority of our sales are from the Polestar 2 model, and we expect to see some shifts in our product mix. We are also observing gradual improvements in raw material prices, which positively impacts battery costs. This consistent decrease in battery expenses is beneficial for us. Additionally, we are collaborating closely with Volvo, which has developed the Polestar 2, and with Geely, who is assisting us in commercial negotiations. We anticipate further cost reductions moving forward.

Tobias Beith, Analyst

Okay. So, understood. But perhaps maybe I can ask whether there was any sort of impairments or any releases that were exceptional in the second quarter versus the first quarter?

Per Ansgar, CFO

Yeah, no, it should not be, to my knowledge. Let us make sure here.

Tobias Beith, Analyst

Okay, great. Secondly, I observe a disconnect between operating income and free cash flow in the first quarter versus the second quarter. I was wondering if you can help me to understand the non-cash operating adjustments and the other parts of working capital in the second quarter. Is it just inventory that is responsible for the free cash improvement? And relatedly, what do you consider a normalized level of working capital for Polestar?

Per Ansgar, CFO

Yeah. What we've done, and as I said, we worked very hard with our cash flow and working capital. So, we have reduced our inventory significantly here, especially in the second quarter, and we will continue to work very hard with that one. So, the main reason for our good operating cash flow is a good reduction of our inventory, especially in the second quarter.

Bojana Flint, Investor Relations

$300 million.

Per Ansgar, CFO

Around $300 million-ish.

Tobias Beith, Analyst

Okay, great. And then, my last question is relating to the Polestar 3 and Polestar 4. Would you describe both of those models as being sold out for 2024 in Europe and the U.S. as of today?

Bojana Flint, Investor Relations

Sold out?

Per Ansgar, CFO

Sorry, please repeat that question. I didn't follow that one.

Tobias Beith, Analyst

Would you describe Polestar 3 and 4 as being sold out for 2024 in Europe and the U.S.?

Per Ansgar, CFO

We will not launch the Polestar 4 until very late this year, so we haven't started delivering that car yet and are not taking orders for it. For the Polestar 3, we have a significant order backlog in both Europe and the U.S., and we expect that to increase as we begin ramping up test drives. From our point of view, test drives are crucial for gaining traction, so we are diligently working on that along with demo cars. I heard from one of our controllers in Europe that once people get into the Polestar 4 and drive it, they appreciate it. However, there is some hesitation about purchasing a car without rear windows, which is why many prefer to test drive first. Therefore, while we do have order books, we anticipate more orders as we increase the availability of test drives.

Bojana Flint, Investor Relations

And, Tobias, maybe if I can just wrap up on what Per said in terms of the point about Polestar 4, the deliveries of Polestar 4 in the U.S. were never scheduled for very late in 2024. We have definitely started deliveries across many European markets, and that's really ramping up, but it's hard to say that Polestar 4 in the U.S. is sold out because we never really plan to deliver it until much later in the year in the U.S.

Tobias Beith, Analyst

All right, great. Helpful as always. Thank you.

Per Ansgar, CFO

Well, thank you for your questions.

Operator, Operator

Thank you. We will now take our next question. Please stand by. The next question comes from the line of Andres Sheppard from Cantor Fitzgerald. Please go ahead. Your line is now open.

Andres Sheppard, Analyst

Hi. Good morning, everyone. Thanks for taking our questions. Wanted to maybe start with deliveries for the second half of this year. So, roughly, you've done about 20,500 deliveries so far year-to-date. Curious if you can give us a little color as to how we should think about the second half of this year in terms of deliveries, and maybe also in terms of the delivery mix between the Polestar 3 and the Polestar 2. Obviously, the Polestar 4 will have probably the smallest breakdown, but just any color on how we should think about deliveries for the second half, that delivery mix, and what the impact will be on gross margins? Thank you.

Per Ansgar, CFO

No, thanks for the question. Obviously, as we've said here, we will see volume growth gradually through the year. So, you should expect third quarter to be better than before, and then you should expect fourth quarter to be even higher up. And especially you will see, as we have guided in our outlook, that the fourth quarter will be strong from a volume perspective. And you're right, the Polestar 2, as we always said, will take a smaller portion of our sales going forward. That car has been fantastic for us for many years, but now we will need to put our focus on this Polestar 3 and Polestar 4. So, in the third quarter, Polestar 3 will be a big vehicle in terms of sales as we start to deliver it, both in U.S. and in Europe. In the fourth quarter, you should expect the Polestar 4 to take a little bit higher lead in that one as we also start to deliver in U.S. from that perspective. And from a gross margin perspective, we have said that our ambition is to have a double-digit growth margin by the end of the year.

Andres Sheppard, Analyst

Got it. Thanks, Per. That's super helpful. And maybe just as a quick follow-up. Was wondering if you can just give us a reminder of where you stand on your capital needs. Looks like there was another $300 million in external funding raised recently. So, just curious what that means there for your upcoming capital needs. Thank you.

Per Ansgar, CFO

No, thanks for that question. Starting with our cash flow, I may have given the impression that I'm overly focused on cash flow, but we have really worked hard on it and improved our working capital. As you can see from the first half of this year, our cash burn is significantly lower than the same period last year, which reflects our improvements. At the end of last year, we stated a need for $1.3 billion, and we have secured $950 million through a club loan in the second quarter of this year. We are also pursuing additional equity financing. Recently, we announced that we have secured around $300 million in debt financing, although it hasn't all been drawn down yet. From this perspective, we are getting closer to that $1.3 billion target. Additionally, we have made considerable progress with our working capital. As I mentioned earlier, our trade financing facilities remain largely undrawn at the moment. As we ramp up production in North America and continue in China, we have substantial working capital and credit lines available, so I don't see an immediate need in those areas. However, as we have consistently stated, we are looking for more equity injections for the company.

Andres Sheppard, Analyst

Thank you. That was very helpful. I appreciate you taking our questions. I'll pass it on.

Per Ansgar, CFO

Yeah, thanks very much.

Operator, Operator

Thank you. We will now take our next question. Please stand by. The next question comes from Dan Levy from Barclays. Please go ahead. Your line is now open.

Trevor Young, Analyst

Hi, Trevor Young on for Dan today. I had a couple questions here if we could just go through. First, I wanted to drill down a little bit more, Tobias kind of was asking about this, but I was just curious if you could perhaps quantify the benefit you called out to gross profit related to the impairment release and normalization of revenue recognition on sales of vehicles to the China joint venture? And just as an additional piece to that, if you could just give a sense of any additional opportunities on Polestar 2 gross margins beyond battery raw materials, or if that is the main driver from here on Polestar 2?

Per Ansgar, CFO

The main factor influencing the gross margin in the second quarter is a mix of positive developments. We completed an inventory impairment at the end of 2023, which brought favorable news in both the first and second quarters. Additionally, we experienced some positive impacts from shifting revenue between the first and second quarters. However, there was also a negative aspect regarding gross margin due to further impairment of a few million U.S. dollars linked to some Polestar 2 vehicles in specific markets. Although this amount isn't large, it did lead to an increase in amortization expenses for Polestar 2s, which have now been categorized under cost of goods sold instead of research and development. As a result, R&D expenses are significantly lower, and part of that cost has shifted to cost of goods sold. These factors largely contribute to the gross margin's performance. On a positive note, we sold a considerable number of Polestar 2s in the second quarter. Looking ahead, our focus will now shift more towards the Polestar 3 and Polestar 4 models. We anticipate that our overall gross margin will enhance with the deliveries of Polestar 3 and Polestar 4, especially in the fourth quarter.

Trevor Young, Analyst

Understood. And then I guess just following up on, specifically on the Polestar 4. I know you're launching it in Europe and the U.S., but I was just curious if you could give a little color on how Polestar 4 sales are trending in China, and then give a few examples of how working with Geely on this platform has been a benefit versus the Polestar 2.

Per Ansgar, CFO

Well, if I start with the benefits of working with Geely on this one, I think there are quite a lot of benefits. First of all, it is produced in China, where we have been able together with Geely to have a quite good cost base. Having said that, we are still working with the cost base on Polestar 4. And the Chinese market is very competitive. So, to be able to sell EV cars in China with decent margins, you need to work with the cost structure. Geely is doing that one, and of course, that benefits us. And we have aligned a lot of activities around the cost reductions on Polestar 4. So that is one benefit we have. The other benefit is obviously the full R&D development. We are able to, as I say, use the best from two worlds. So, we can use software and kind of like entertainment systems from a European and Western perspective for those cars in Europe and U.S. And we can also use the China, similar systems in China for Polestar 4, which is very helpful for us. The third very good support is that we are now also working with South Korea to make this car being produced in South Korea for U.S. production and potentially also for other markets going forward. And that is also, of course, supported by Geely. We have their teams very close by and so on. So, the progress on making Polestar 4 produced in South Korea in Busan plant is progressing very well. So, we expect that production to start mid next year, which will be very helpful for our U.S. deliveries from that perspective. Then, of course, as you said, how are we doing in China? The cars were very well received. The Chinese market is tough. Many of the Chinese car brands are losing money on their sales. We have been making sure that we are balancing volume and margins in a good way. Our plan and our expectation is that by later of this year, we will also start to deliver Polestar 3s in China, and then into next year, Polestar 5 into China. And those two cars are significantly more, especially the Polestar 5 premium luxury vehicles, which we will target at the more affluent Chinese customers. So that will continue to build the Polestar brand in China.

Trevor Young, Analyst

Thank you for the insights. May I ask one more question? I appreciate the strong working capital improvement you noted in the second quarter, with the inventory drawdown amounting to around $300 million. However, I wonder about the sustainability of this working capital strength with the introduction of two new models. Historically, increasing volumes can create challenges for working capital. Could you share how you plan to manage this and what strategies you have in place?

Per Ansgar, CFO

We are currently collaborating closely with our retail partners as we update our sales model in Europe. In the U.S., where we operate on wholesale models, and similarly in China, we aim to accelerate both our sales and delivery processes. For instance, in Europe, we are implementing measures to reduce the lead time from when cars arrive at the port to when they are delivered to dealers. Our sales model in Europe involves us retaining ownership of the cars until they are handed over to customers. By reducing this lead time, we believe it will significantly benefit us. Additionally, the production of the Polestar 3 in the U.S. will enhance our position as it brings us closer to customers, not just in the U.S., but also in Europe, since we will begin producing Polestar 3s in South Carolina for European markets later this year. This will enable us to improve our timelines further. As a result, we expect a lower working capital as a percentage of revenue compared to previous periods. However, selling more cars will naturally require more working capital. Fortunately, we currently have about 90% of our trade financing capacity available, providing us with additional potential.

Trevor Young, Analyst

Great. Thank you.

Operator, Operator

Thank you. We will now take our next question. Please stand by. The next question comes from Daniel Röska from Bernstein Research. Please go ahead. Your line is now open.

Daniel Röska, Analyst

Good morning, good afternoon. I appreciate you taking my questions. Per, can we discuss the tariff situation and what developments you've observed? To help us understand the impact, could you provide a rough estimate of how much tariffs have impacted gross margins in the past and whether any changes are anticipated in the upcoming quarters? Additionally, how does this connect to your earlier statement about aiming for double-digit gross margins by the end of the year? For my second question, which has been mentioned but I'd like to revisit, let's talk about free cash flow. You've had some relief in working capital, but if we exclude that, it seems your ongoing cash burn remains relatively stable. Analyzing the past few quarters starting last year, cash burn has been between $400 million and $700 million each quarter. Even with the $300 million added back from Q2, we’re still looking at a $400 million cash burn. How do you expect this cash burn to evolve as you scale volumes and improve gross margins in the upcoming quarters? Can you provide a timeframe or range for when you anticipate that underlying cash burn will turn positive? Thank you.

Per Ansgar, CFO

Thank you for your question. I've noted your points, so I'll address all of them comprehensively. First, I want to reiterate that we've made several strategic decisions in the past to ensure that tariffs won't significantly impact us moving forward. One key decision is our plant in Charleston, South Carolina, where we will manufacture Polestar 3s for the U.S., Canada, and Europe, effectively mitigating tariff issues. Currently, the tariff rate for the U.S. stands at 27.5%, and a recent announcement proposed an increase to over 102%, which, as far as I know, has not yet been enforced. We'll have to wait a bit longer to see when that might take effect, but it is one of our major strategies to avoid these tariffs. In addition, we are working with our South Korean plant, in collaboration with Renault, to produce Polestar 4s for Europe, and we are exploring whether this facility can also supply these vehicles. Furthermore, we've accelerated our cost reduction initiatives significantly and have engaged in numerous discussions with both Volvo Cars and Geely regarding actions to take. We're examining all vehicle lines, including Polestar 2, Polestar 4, and Polestar 3, to identify opportunities for reducing base costs. Despite being new models, historical trends show that there are often cost optimization opportunities available post-launch, which we are currently working on. Regarding U.S. tariffs, we will manage this with our Polestar 3 production and the production of Polestar 4 in South Korea, along with utilizing a netting system in the U.S. for other vehicle lines. Thus, we don't foresee this as a major issue. Moving over to Europe, the European Union has announced a tariff increase, typically 10% on imports from China. Based on the new proposal, Geely, Volvo, and Polestar could face a rate of 19.3% if implemented. The implementation has already been postponed from July to November. There are ongoing political discussions, with some EU member countries opposing this increase, as they believe it wouldn't benefit their industries or markets. We're actively engaging in dialogue with the European Union to explore alternatives for mitigating the impact of these tariffs. Earlier today, I met with representatives from the European Commission to discuss our current status, the potential impacts of the tariffs, and whether they align with the Commission's objectives. The European Commission aims to protect and foster European industry and technology. From Polestar's standpoint, imposing tariffs on imported vehicles from China would counteract our investment in European technology alongside Volvo Cars and our suppliers. It would be more advantageous for both Polestar and the European industry to have lower or no tariff increases. Addressing your question on our gross margin, if it reaches above 10%, it will likely occur in November. We expect to import a significant number of vehicles before that time, and we are diligently working to mitigate the impact of these tariffs moving forward. As for your question on cash burn, working capital has greatly assisted us. I anticipate we will maintain a lean working capital structure without significantly increasing it. Thus, I view that as less of a concern. The underlying cash burn is primarily driven by gross margin fluctuations, which have been close to breakeven in recent quarters. We expect positive gross margins from the Polestar 3 and Polestar 4 moving forward. Additionally, our investing cash flow is expected to peak this year due to substantial investments in Polestar 3, Polestar 4, and final R&D for Polestar 5. As we transition into next year, investing cash flow should decrease. By keeping working capital lean, improving gross margins, and gradually lowering investment levels, we anticipate an improved cash flow in the future, particularly in the next year.

Daniel Röska, Analyst

Great. That was super helpful. Thanks, Per.

Operator, Operator

Thank you. As there are no further questions on the phone lines, I would now like to hand back to Bojana for any questions from the retail.

Bojana Flint, Investor Relations

Thank you, Sonya. Per, we will go through the top three questions from retail shareholders that we received on the Say Technologies platform. I will read them out and then we can provide answers. The first question is about the deficiency notice that Polestar recently received from NASDAQ. What measures are being taken by leadership to ensure compliance and reassure shareholders that the stock will not be delisted in the future?

Per Ansgar, CFO

Two things on that one. First of all, we had a deficiency on our reporting compliance. That one was and I must say I'm very happy to make sure that we have healed that one as we filed our full year 2023 Form 20-F in mid-August. So that has gone now, so that is very good. The other deficiency is the share price being below $1. And we have been trading below $1 for quite some time. The last couple of days, it's been above $1. It was above $1 also earlier in July. So, it's moving around there. We have up to early next year to heal this deficiency. Our plan or our ambition is, of course, really to make sure now that with our increased deliveries and sales on Polestar 3 and Polestar 4, and continued good feedback from customers, and you will gradually, during the year, see that this starts to happen that the share price should go up above $1, which is really what we think. If you think about it, Polestar is a European-based company with a good manufacturing and R&D and sales footprint globally, which can like stand out from all others and we have 170,000 cars on the road or close to that one. So, we are a company, which I think puts us apart from many of our EV competitors. Of course, that is what we are targeting.

Bojana Flint, Investor Relations

Yeah. And maybe just to sort of wrap up on the previous one, we always said and we're very mindful of that and Board and management are monitoring the situation very closely when it comes to the $1 threshold.

Per Ansgar, CFO

Yes, definitely.

Bojana Flint, Investor Relations

Okay. Question number two, which sort of links back to the previous question as well is very much what are current plans to increase the share value?

Per Ansgar, CFO

Yeah. I think, I've basically said most of this one. I think, again, the business needs to demonstrate improvement and I think we have been doing this gradually through the year, and we'll continue to do that.

Bojana Flint, Investor Relations

Absolutely. And we have said in the past as well that we are going to grow in the existing markets, we're going to spread into new markets as well, and we have fantastic products coming through. So, a lot of exciting developments.

Per Ansgar, CFO

Yeah.

Bojana Flint, Investor Relations

So, we have taken the first top three questions from the retail shareholders, so we can close the call.

Per Ansgar, CFO

Yeah. And then, I'll say thank you very much for listening in here, and I will look forward to meet you here again quite soon when we are going through our third quarter results here in November. So, welcome back, and thanks for listening in, and thanks for your questions. Have a good day.

Operator, Operator

This concludes today's conference call. Thank you for participating. You may now disconnect.