Karen David-Green - Vice President-Investor Relations Krishna Shivram - Chief Financial Officer & Executive Vice President Bernard J. Duroc-Danner - Chairman, President & Chief Executive Officer.

Jim D. Crandell - Cowen & Co. LLC Angie M. Sedita - UBS Securities LLC James Wicklund - Credit Suisse Securities (USA) LLC (Broker) James Carlyle West - Evercore ISI Group Scott A. Gruber - Citigroup Global Markets, Inc. (Broker) Bradley P. Handler - Jefferies LLC Ken Sill - Seaport Global Securities LLC.

Good morning. My name is Lori, and I will be your conference operator today. At this time, I would like to welcome everyone to the Weatherford International Second Quarter 2015 Earnings Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session.

As a reminder, ladies and gentlemen, today's call is being recorded. Thank you. I would now like to turn your conference over to Ms. Karen David-Green, Vice President, Investor Relations and Corporate Communications. You may begin your conference..

Thank you, Lori, and good morning, everyone. With me on today's call from Geneva we have Bernard Duroc-Danner, Chairman, President and Chief Executive Officer, and Krishna Shivram, Executive Vice President and Chief Financial Officer.

Before we start our comments, I'd like to remind our audience that some of today's comments may include forward-looking statements and non-GAAP financial measures. Please refer to our second quarter press release for the customary caution on forward-looking statements and a reconciliation of non-GAAP to GAAP financial measures.

And now I'd like to hand over the call to Krishna..

a charge of $112 million to reflect the settlement of a lawsuit related to the restatement of our historical financial statements in previous years. With this settlement, all the litigations related to the restatement will have been settled, with only the SEC investigation still ongoing.

A charge of $223 million primarily for the impairment of part of our U.S. pressure pumping asset base. With only 44% of our fleet active at the end of the second quarter, we ran an impairment test on the carrying value of our pressure pumping business in the U.S., resulting in this charge.

I would now like to update you on the cost management actions taken to-date and our self-help plans going forward. In April, we announced an increase of the reduction in force exercise to 10,000 employees or 18% of last yearend's head count of 56,000. As of July 15, we have released 9,936 employees, generating annualized cost savings of $754 million.

These savings have begun to have effect, evidenced by the benign decrementals experienced to-date. These savings will roll over into the second half of the year with larger numbers and a larger effect than in the first half.

Based on the prognosis we have of the North American business environment and our cost base, we have decided to increase the size of this exercise to 11,000 employees, which is 20% of the workforce at the beginning of the year, with the increase concentrated in North America and on support positions.

Our support ratio has dipped to 41.7% from 45% at the start of the year. We continue to target a sub-40% support ratio by year-end and low to mid-30%s by 2017. We ended last year with 56,000 employees and we ended the first quarter with a head count of 49,000. The second quarter ended with 45,000 employees.

Of this head count, rigs represented 6,000 employees while our core business had 39,000 employees at the end of the second quarter. We had also planned to shut down seven of our manufacturing facilities this year. Two of them were closed in the first quarter and three more in the second quarter. The last two will be closed in the third quarter.

Separately, we have shut down and consolidated 60 operating facilities across North America to-date and we expect to close 30 more in the second half of the year. Our procurement savings initiative is also on track and helping to reduce input costs.

Overall, continuous focus on costs has resulted in reducing the number and value of purchases and capital spending significantly, which has resulted in inventory and CapEx reductions. We now have a leaner and more focused organization, setting us up for strong incrementals when activity levels increase over time.

Moving on to net debt and cash flow now. Net debt reduced by $107 million to reach $7.2 billion at the end of the second quarter, reflecting positive free cash flow of $104 million.

Our free cash flow performance improved by $370 million sequentially despite larger operating losses, net cash outflows of $13 million on the Zubair contract and $39 million of severance payments.

Working capital balances reduced by $110 million, with reductions in inventory and accounts receivable balances partly offset by lower accounts payable balances. CapEx at $187 million reflected the continuous control on our capital spending.

Looking ahead, working capital will continue to generate positive cash flow through to the end of the year, mainly through inventory reductions. Our capital expenditure plan for the year has now been revised down by another $100 million to $750 million, which is about half that of 2014.

In the second half of the year, we expect severance payments to reduce substantially while the Zubair project will be cash neutral as milestones that are achieved trigger additional cash payments. Working capital will continue to reduce and Capex will be curtailed, as evidenced already by our first half performance.

The combined effect of these items coupled with improving results will secure positive free cash flow in both the third and fourth quarters. As a result, we expect to be free cash flow positive for the full year. During the second quarter, we successfully extended our revolving credit facility of $2.25 billion by one more year on a proactive basis.

This facility would have expired in July 2016 but is now valid until July 2017. We experienced no difficulty in this extension process and our bank group continues to support us completely. As of June 30, available liquidity was $1.9 billion, meaning we have a large borrowing cushion still available to us.

In terms of long-term bond maturities, nothing matures in 2015, only $350 million mature in 2016 and $600 million mature in 2017. We believe we can repay these maturities with free cash flow without needing to refinance this debt. In summary, we have plenty of available liquidity.

Our ability to generate positive free cash flow from operations, as borne out by our second quarter performance, will reduce our debt levels going forward.

In summary, we believe that we have managed the down cycle well, with overall decrementals that are comparable with the best of our peers and about half the decrementals experienced during the last down cycle. With that, I will now turn the call over to Bernard..

well integrity, lower drilling and completion cost curve and sustained production rates. We do not have a strategic need to add or change our product line, breadth or depth. Our measurement of success will not be sized in an attempt to emulate some of our larger peers.

Our path takes us towards operating excellence and a strict focus on our industrial mission. We can grow and prosper as we are to the great benefit of shareholders and clients. We're taking strong action. I think this market is an opportunity as much as a punishment. We are making operating, organizational and marketing progress.

Weatherford will be efficient, lean, client-driven and organizationally flat. With that, I will return the call to the operator for Q&A..

Your first question is from Jim Crandell from Cowen Securities. Your line is open..

Thank you and good morning..

Good morning..

Bernard, both you and Krishna mentioned that you're beginning to gain market share, particularly international.

Can you talk about where that may be? And do you think that the gains in market share are at all a reaction to the big consolidation move in the industry?.

I think they are widespread. It's not in one particular place. I don't think they are necessarily that correlated to the consolidation underway insofar as, in a number of instances, we don't really compete with the three or we complete with one of the three. So it's not clear that it has very much to do with that. I think it has more to do with us.

Has to do with some of the technologies we put on the market. Has to do with the fact that we were not as aggressive and as focused in some of the markets in the past as we are today. I think it has more to do with us than it has to do with industry events, at least for now.

And also, Jim, in the end, because we're not that large of a company, it's not big numbers, it's not dramatic, but it is happening. So it's widespread, affects a number of different markets, a number of different product lines, and I wouldn't say there's a particular theme as to who is losing the share.

Krishna, do you want to add to that?.

Yes. Thanks, Bernard. Jim, just to elaborate a bit further on what Bernard said, the numbers speak for themselves.

If you look at the sequential revenue differential between the first and second quarters and, in fact, even between the fourth and the first quarter of this year, you can see that it's a gradual gain internationally and right across the board in every region versus our peers. So I won't go through the numbers, but the numbers speak for themselves.

They're quite evident..

Okay..

We also have a slew of contract wins right through in the second quarter for which revenues will be recognized starting in the third quarter. And we are quite comfortable to say that this trend will probably continue..

Okay. And as a follow-up question, it doesn't sound like given your comments about the markets themselves that they'll give you enough that you could reach breakeven by the fourth quarter.

Can you talk to that? And then could you also address what you think will be the outlook, let's just say, in a $55 to $60 Brent crude environment for international E&P spending in 2016?.

When you say, Jim, breakeven, what breakeven are you referring to?.

Breakeven on a P&L basis..

Oh, I don't think we know. Q4 is three months from now, so we're taking one quarter at a time. So that's probably a question that's better asked in October rather than now. We don't know either way, but it's in the realm of the possible. This is the first answer.

The second question, which is $55, $60, presumably is that Brent or West Texas, hate to be specific?.

Brent..

Brent. $55, $60 Brent at year end or viewed as being the prevailing environment for next year. I would have to say that the E&P overall plans, some would be up, some would be down. I think they would be actually, will go sideways 2015 on 2016 internationally. And it really depends what part of the world.

I think offshore and deepwater will tend to be affected because when you have a sharp decline like we had, typically land gets hit across the board everywhere because it's much easier to curtail land than offshore. And of course things get postponed. So I think that it will go sideways.

Land may do a little bit better and offshore will do a little bit worse. It'll go sideways, otherwise overall at that level would be my guess..

Okay. Thank you..

Your next question comes from the line of Angie Sedita of UBS. Your line is open..

Thanks, guys. Good morning or good afternoon..

Hello..

Hi. So can we talk a little bit about Zubair? And just walk us through what's happening in the market as far as your target. My understanding is you have essentially three different physical locations and three different targets.

So can you talk us through where you stand on those targets? And does the current environment in Iraq make achieving those targets any more difficult? And then where you are on how does the cash play out as far as the cash payments? Is that back-end loaded for those final targets?.

Yes, Angie. I'd like to say that the very first mechanical completion milestone for the first two sites will be close to completion next week. By the end of the month, we expect the first site to be certified and then very early in August the second site.

So it's a little bit slightly behind the previously communicated schedule, mainly because of logistical and security reasons which continue to abound in Iraq.

Having said that, we're quite comfortable to say that we will hit the mechanical completion milestones within Q3 and we'll start hitting the RFC milestones at the end of Q3 going into Q4 for one of the sites. So the cash flows related to the achievement of these milestones will flow steadily back to us.

And as I said in my prepared comments, we think we'll be cash flow neutral in the second half of the year for Zubair..

So does that imply that hitting the targets could fall into early 2016?.

mechanical completion, ready for commissioning and performance acceptance certification. And we will hit all the milestones by the end of the year. The cash flow related to the very last milestone may slip into first quarter 2016. Despite that, we should be cash neutral during the second half operations for the year..

Not to minimize the importance of every single stage, Angie, but mechanical completion, the first stage, is really the most, I think, demanding and difficult. That's the one which is upon us in a matter of days..

Okay, okay. That's very, very helpful. And then as a follow up to Jim's question on the market share and if you think forward about the closing or potential closing of the Baker Hughes-Halliburton merger, I mean, certainly you could talk a little bit, if you would, on where you think the potential easy opportunities could be.

But I think you've also stated in the past that you have some growing up to do to capitalize on other opportunities. And maybe you can talk us through on the steps you're taking up to continue that grow up process to capitalize on more than what you could easily take advantage of..

We're quite internally focused, Angie, when it comes to getting ready to capitalize on opportunities. There is – the events in the industry, for one, that was extraordinarily interesting. Certainly from an analyst perspective, they're captivating and very, very important. We are not that involved, obviously, in the process.

And we really don't spend too, too much time looking at the various sequences of events. It will be important for everybody in the industry, not only us. And so I think we'll let that unfold the way it will without speculating too much on it. We are focusing a lot on – well, it's not all about efficiency.

A lot of it has to do with delayering the organization, operating with fewer people, but better people, operating in a much leaner, faster, more disciplined manner also. We're focused a lot on that. We're focused a lot on training, people development. Focused also a lot on sales and marketing and reengaging with our clients the way we used to.

All these things that should make up the fabric of the company, which it has no more distractions, we have no more internal distractions. The only focus we have is simply our operations, our clients and progressing. See, it really isn't whether we can gain share from this or that particular company.

The point of fact is that we try to do the best we can in the few product lines which we are in. Again, our product line is not as broad at all as some of our larger peers. We have fewer product lines. We try to do the best we can in those product lines. And there are many markets in which we are very, very under-represented. So we focus on that.

And that's it. We try to do it more efficiently with a high quality of people. It's as simple as that. It's not very spectacular. It's all about having far better execution than we've ever had. That's it..

All right. Fair enough. I'll turn it over..

Your next question comes from the line of Jim Wicklund of Credit Suisse. Your line is open..

Good morning, guys..

Hey, Jim..

Good morning, Jim..

I remember the third quarter of last year you were expecting to get a refund of deposit basically from Iraq. But the Southern Iraqi Oil Company in Baghdad wasn't signing much of anything. And now we understand that that process may be improving a little bit.

What ever happened or what's going to happen with your stranded $250 million in Iraq?.

Jim, you're talking about the potential claims on the cost of the variation orders on the Zubair project, right?.

Yeah, he is..

So, Jim, the situation is that we have commenced an arbitration proceeding against that customer and made the claims. And right now at this present moment, we have stayed the arbitration so that we can complete the project in a cooperative manner.

This arbitration is just in abeyance, but will come back if we don't get a settlement offer from the Iraqis and through our client. So I think the dialogue on this will continue once we complete the milestones and deliver the project..

you have the operator, which is ENI, you have the ultimate reservoir owner, which is SOC, and you have us. It's sort of difficult to have a constructive relationship and also be arbitrating at the same time. So we decided that the compromise was I think the least bad way forward. I wouldn't say nothing is terribly good about Zubair.

The least bad way forward was to finish the project as quickly, as efficiently, as professionally as we could. For that, a constructive relationship with the operator was useful. To that effect, we, by common agreement, froze the arbitration process and we're finishing the project. The project will be finished this year. Fine.

As I said, it'll be finished in a professional and quality manner. Fine. Once that is done, then we will either negotiate a settlement and/or concurrently reinitiate the arbitration process. So that's the sequence of events. Yes, it will take longer to collect whatever is coming our way from the settlement.

But we'll do that, Jim, purely as a negotiation or a legal procedure with all the operating work and all of the actual construction on the ground being behind us, which will I think take more time but will be far I think much healthier..

Makes sense. Okay. I appreciate that. Second, if I could, you noted that pressure pumping was abysmal in the quarter. On the first quarter call, Bernard, you made it sound like the first consolidator who rang your doorbell might end up owning that business.

Is that still the case? Is there, a love interest still with pressure pumping, or is that a dispassionate potential divestiture if somebody comes knocking on your door?.

Well, first of all, I'm not sure there are many people that are knocking on anyone's door when it comes to pressure pumping in the U.S. I think this is number one. I think very much, like in the case of Zubair, we tried to be as brutally realistic about what we need to do as we can.

So first, what we have done with pressure pumping, and you can see some of the results in month by month at Weatherford, is we've learned how to run it better, which, all things being equal, can only be a positive, whether it stays part of the core and so forth or whether it does not. So we have learned how to run it better.

And then you can see it in the numbers. Those numbers are not good because the market is not good. It's vastly over-supplied. You know all of this. However, we have come to the successful achievement of running the pressure pumping operation in the U.S. with half the revenue of Q1, this is in Q2, but essentially the same dollar amount of losses.

So the losses have not increased. And as we move forward into Q3, we are EBITDA positive. And I think in terms of quality of operations, we upgraded our client list and I think we have a gradually more successful operation..

Excellent. That's very helpful. And the comments about your restructuring of North America, I think are very helpful, too, Bernard. Thanks, guys, very much..

Thanks..

Thank you..

Your next question is from James West of Evercore ISI. Your line is open..

Hey. Good morning, guys..

Good morning, James..

Maybe, Krishna, first for you. If I'm doing the math correctly here, you took out $500 million in costs last year. You talked about cost savings so far this year of $754 million. I believe there's now $300 million in procurement costs over this year and next year, maybe some of that's already in that $754 million.

But we're looking at a cost savings number that's definitely over $1 billion, but maybe in the $1.5 billion range.

Am I in the right area at this point?.

Yeah, I think it's over $1 billion for sure. I would hesitate to say $1.5 billion, but somewhere in between those two numbers, yes..

Okay, great.

And then my follow up to that, and I think you'll see what I'm trying to get at here, is how much of the cost savings of that, let's say it's a little over $1 billion, would you perceive as structural in nature versus more just cyclical cost savings due to the downturn?.

Well, I can only give you a rough estimate..

Sure..

one-third support and two-thirds direct, would be a good mix, rule of thumb..

James, that's a very good question you're asking. We don't have for conference calls sort of type of dialogue numbers down to a sound bite. I would have to say that it is north of $1 billion, the overall cost being taken out, I totally agree with that, cash numbers. And I also think that a third being perennial is actually I think very reasonable.

I would say probably I would have used the number 40% myself. We are very obsessive about the perennial and the structural. Very, very obsessive, precisely for the same reason you're asking the question. This the quality of the numbers coming out of this company when the business improves.

It's very, very important that the – and furthermore with a more efficient structural cost basis you will run the company better. Forget about the P&L being better; we'll just run it better.

The de-layering, you're making the organization not as heavy, decision-making, very disciplined, very responsible, but not hiding behind layers of people I think makes a better company. We're trying to be a better company, it's as simple as that..

Absolutely makes complete sense. And if it's 40% or a third or so, significant earnings leverage as we come out of this. So thanks, Bernard. Thanks, Krishna..

Thank you..

Your next question is from Scott Gruber of Citigroup. Your line is open..

Good morning..

Good morning, Scott..

I want to continue on James' line of inquiry. I realize that you're continuing to de-layer the organization. But overall, can you give us a sense of what level of activity you're targeting in terms of sizing your U.S. organization today? I don't know if you can dimension that relative to a recount or maybe a North American revenue number overall.

As you think about sizing the organization, how are you thinking about that in contrast to the market size and your opportunity set?.

Well, right now, Scott, we think activity levels are going to kind of flatten, maybe slightly tick upwards, but not materially for the rest of the year. We still have 1,000 more people that we're targeting, mainly in the U.S., to take out. And we mentioned that in our prepared comments. And again, the focus is going to be more on the support side.

So at this point, I think that's pretty much it. I think our organization is kind of well-sized now going forward with just the 1,000 more to go really..

There's the support function, which support is broad and it covers a lot of activities, that we're designing, not only for North America but company-wide. It's designed to be the same at the present level of activity and also some level of activity that's higher than that. That's the whole point.

So that we're hoping to have the company operate with a level of activity which would be – I can't give you the exact numbers because we don't want to do anything irresponsible, but quite a few percentage points, high levels of activity with the same support structure and do it very efficiently.

But in terms of scaling it to where it needs to be to help North America have more constructive numbers, we're getting there. With the other 1,000, we'll be there.

We'll be at a level of cost structure where, with the present level of business, understanding that we are more land than offshore, which I think in the long run is not desirable, but in the short run actually it is not that bad because land took it on the chin.

Offshore will take it on the chin now, which means that all things being equal for us in the U.S., it's likely to be a little bit smoother sailing for us going forward, cost structure and also market exposure..

Got it. And then unrelated follow-up. Bernard, you mentioned no need to expand the product offering.

However, with the DOJ potentially pushing back on Halliburton's bid to buy Baker, would you consider issuing $8 billion, $10 billion of equity, whatever's needed, buying a large collection of assets, establishing yourself as the number-three competitor in drilling and completion offshore and deleveraging your balance sheet all at the same time?.

I think that if the capital market valuation of oilfield services were very different, that might be a conversation we would have. Today, I think the cost of capital we have extremely high. This is first answer, meaning that it feels prohibitively expensive.

The second answer is that we really don't know what will happen after the Halliburton-Baker combination there is one set of assets. We don't have much of an opinion today on the level of interest we might have or not. I think a lot of people are interested in it. So the answer is that we are very content with what we have.

We're not obsessive at all about what's going on with those two companies. Many other people are. I think our time is better used focusing on what we have than on daydreaming about what we could be adding or not. Very difficult for us. Even if we did daydream, very difficult for us..

Sounds like a sound strategy. Thanks..

Thanks..

Your next question comes from the line of Brad Handler of Jefferies. Your line is open..

Thanks. Good morning..

Good morning, Brad..

Morning. I guess I'll play market watcher a little bit and just sort of respond to what's happening during the course of the call, if you'll allow me.

If we try to put together the thread of questions with respect to the cost savings and building through realizing those cost savings in the second half of the year relative to your comments around a very stable international outlook and an improving North America outlook, is it hard to craft a view that the fourth quarter would be breakeven or even slightly positive EPS?.

Krishna, you can answer it. For my own part, I'd say we think it is possible. I think we'd rather answer that question in October. But, Krishna, you want to give a....

Yeah, I think, Brad, in this market environment, it's a bit hazardous to start testing that early. It's in the realm of possibility, yes..

Okay, fair enough. I guess an unrelated follow-up that's a lot more granular; can you just speak a little bit to the project delays that you cited in Sub-Saharan Africa? How pernicious is that and maybe how widespread is it? How much taken by surprise are you? Just maybe a little bit more color around that comment would be helpful..

You probably know as much as we do about it, Brad. We're not surprised in the least when pricing of oil goes from $110 to $50. The first business to go to pot is land across the board. Land is much easier to stop, land is much easier to basically cancel. Offshore and deepwater is much harder to cancel in short order.

Now, first thing that you do postpone is anything that's not actually physically taking place. So anything that's on the drawing board gets adjourned. That happens. Now what is already physically taking place, you can't just pull the plug.

In simple terms, anything that's offshore, and let alone deepwater, you just wait until the first opportunity where you can pull the plug. And that inevitably happens if the price of oil doesn't correct, which it isn't. We are at that point today.

And so I think you see a rash of cancellation, delays and so forth all over West Africa and in all the hot spots of activity. We are not in the least surprised. I think for us it simply means that the prognosis, which was so bullish for us in SSA, have gone from very bullish to subdued.

But they're not bad, simply because we didn't have a large play at all in that geographic market. We were getting it by recovering market shares we had lost and gaining new market shares based on technology, while the numbers won't be what we were hoping for them to be.

But we will not, at the same time, experience great reversal of economics simply because it was prospective as opposed to something that we have already in our P&L. So to summarize, it is very material.

It will be increasingly material as time goes on and the prospect of having another year in 2016 of very, very low oil pricing, you will see deepwater and anything offshore basically weaken. It's absolutely normal. Land, paradoxically, will not weaken as much because it already has happened.

Which is, again, if you look at the chronology of events in our industry, this is how it unfolds. So we're not surprised in the least. And, yes, it's disappointing for us. But I don't think I would characterize it as painful in terms of SSA. It's just something that will happen later and not something that we had our P&L to begin with.

We were prospectively hoping to have it in our P&L.

Okay?.

Understood. Thank you..

Your next question comes from the line of Ken Sill of Seaport Global. Your line is open..

Thank you. Good afternoon to you people in the nice environments of Switzerland versus Houston, which is up to 100..

Good afternoon..

Hi, Ken..

I wanted to talk about, is being heavier on the land side good or bad in the current price environment? Obviously in the current price environment, people are having to rethink where the economics are. And we've been in a market where the deepwater has been the target of more spending and more spending and more spending.

But with the ability of North America to grow production and what's clearly rising spending in the Middle East, I guess long-term strategically, do you think being onshore is actually a negative going forward given how quickly onshore can respond to price changes?.

Ken, I think that neither one. I think that we obviously are smaller than our larger peers, but we're not small. That's an overstatement. I wouldn't say that. And given the breadth of what we have, we say we're content with what we have. Given the breadth of what we have, we really have a place, both on land and offshore in deepwater.

So for us really we need to be represented in both. I wouldn't make an exclusive bet at this point in time, though, on one or the other. I would not recommend that. I wouldn't just try one because you're likely to pick the wrong one.

And so the answer is they have to be much more balanced because the prognosis – you can make a case for the prognosis being equally – in a better environment of course, equally encouraging for land than it is for deepwater. And today nothing is encouraging.

But eventually, the point being eventually, I think some of the luster that deepwater plays have had may as with the turn of the market, they may come back, but they won't be exclusive. They'll be shared by some of the land plays. That's as much as I can say.

But for us really we need to be involved tactically today, tactically today, because the land people took it on the chin first. That would be people like us. It is true that in the land markets, you're probably tactically a little better off today than the offshore market. But it's just a question of the misery spreading. That's all..

Okay. That's a good answer. It makes a lot of sense. And then one final question. I was a little bit surprised by the impairment charge in pressure pumping. Clearly a lot of assets stacked, but you guys are the first ones to announce something like that.

Could you kind of go through the process and how the impairment was determined relative to your asset base?.

Well, Ken, it was purely determined from an accounting standpoint. We had more than half our fleet stacked. And when such an event happens, we do test our assets periodically for impairment and there was a case to do that.

And when we did perform the impairment test, we found that barring some extraordinary assumptions, we would not be able to support the carrying book value of the asset. So we decided to take an impairment charge. We think that's quite a responsible way to do it given the market conditions in North America.

The impairment charge was purely related to the U.S. pressure pumping assets. It was just in one country..

I think the book value now is very reasonable of our pressure pumping assets..

Yes. They're quite....

Quite low..

...a lot more realistic..

Quite low..

Thank you, Ken. With that, I think we will close the call and thank you for your time because I think the hour is over and there's another company call which is scheduled now, if I'm not mistaken. Thank you very much..

Ladies and gentlemen, this concludes today's conference call. You may now disconnect..