Good afternoon and welcome to the Flex Second Quarter Fiscal Year 2021 Earnings Conference Call. Today’s call is being recorded and all lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question-and-answer session. At this time, for opening remarks, I would like to turn the call over to Mr. David Rubin, Flex’s Vice President of Investor Relations. Sir, you may begin.

Thank you, Rob. Welcome to Flex’s second quarter fiscal 2021 conference call. Joining me today is our Chief Executive Officer, Revathi Advaithi; and our Chief Financial Officer, Paul Lundstrom. This call is being webcast and recorded, and if you’ve not already received then slides for today’s presentation are available on the Investor Relations section of our flex.com website. As a reminder, today’s call contains forward-looking statements, which are based on current expectations and assumptions that are subject to risks and uncertainties, including the impact of the COVID-19 pandemic, and actual events or results could differ materially. Also, such information is subject to change and we undertake no obligation to update these forward-looking statements. For a full discussion of the risks and uncertainties, please see our most recent filings with the SEC. Lastly, this call references non-GAAP financial measures for the current period. GAAP reconciliations can be found in the appendix slide of today’s presentation, as well as in the Investor Relations section of our website. With that, I’d like to turn the call over to our CEO. Revathi?

Thank you, David. Good afternoon and thank you for joining us today. I hope you and your families remain well through these challenging times. I want to start off by thanking all of my Flex colleagues for their commitment and perseverance through these unprecedented times. I believe it is often in these toughest situations that we find what we’re truly made off. And these past months are an example of that. On behalf of the entire leadership team, our sincere thanks to the global Flex family for all of that – all – for all that you have accomplished, our strong fiscal Q2 results are a testament to your efforts. Now let's turn to slide 3. Let me start off with a few highlights in our financial metrics for the quarter, our revenue was over 5.9 billion, up 16% sequentially, and down 1.7% year-over-year. Our adjusted operating margin was strong at 4.1%. This includes continued COVID-19 related costs, as well as some lingering demand weakness, partially offset by austerity measures that ended with Q2. Our adjusted EP s was $0.36, up from $0.31 in Q2 of last year. Our adjusted free cash flow came in at $326 million. I will point out that this is the strongest quarterly adjusted free cash flow in 15 quarters and maintains our objective of 80% adjusted free cash flow conversion. Moving on to the next slide, we executed really well in fiscal Q2, taking advantage of improved market dynamics that resulted in sequential improvements in all our end markets. Our Reliability segment grew both sequentially and year-over-year. These results were driven by a continuation of the strength we have seen in Health Solutions, as well as stronger than anticipated rebound in automotive after a very difficult Q1. Despite continued macro challenges in Automotive, we…

All right. I don’t remember that part being in the script, but thank you Revathi. So, if you could please turn to slide 6. Flex revenue was just under $6 billion a quarter, and that was up 16% quarter-over-quarter, and down 2% year-over-year, although we are pleased that both the Agility and Reliability segments experienced sequential growth. COVID-19 related demand pressures still remain uncertain end markets, we’ll spend more time detailing those factors later in the call. Despite a roughly $100 million revenue headwind, adjusted operating income of $247 million was up, $20 million compared to last year that our mix, productivity and austerity measures were tailwinds in the quarter, and more than offset COVID-19 related costs. As a result, our adjusted net income was $180 million, and our adjusted earnings per share, was $0.36, up 16% year-over-year. Second quarter GAAP net income of $113 million was lower than our adjusted net income, due in part to $24 million of stock-based compensation and $14 million in net intangible amortization. In addition, net restructuring and other charges were roughly $30 million. As we move through the balance of fiscal 2021, we will proceed with remaining restructuring activities in a measured and prudent way to minimize impacts to our operations. We still expect approximately $100 million of costs between Q2 and Q4. Please turn to slide 7. Our second quarter adjusted gross profit was $423 million, and despite more than $100 million of top line pressure was up year-over-year with margin rates up 30 basis points to 7.1%. Since March, our teams have navigated the dynamic demand and production environment exceptionally well. And we are pleased that our global sites operated with minimal production disruptions in the quarter. We did, however, have cost headwinds related to the ongoing pandemic, continued spending on…

Thanks, Paul. So as you can see our fiscal Q2 execution was really strong and you can also see from Paul's comments that we expect that improvement to continue into fiscal Q3. So as I think about the second half of the fiscal year there are a few elements I would like to highlight. Firstly in Health Solutions, COVID related episodic and acute care product demand may likely roll off in late Q3, we fully expect elective related medical products to return, it concerns about increasing COVID levels and multiple geographies appear to be slowing back recovery. So we don't expect to see the electromedical market rebound until early in our next fiscal year. In the other end markets I also anticipate some catch up demand could begin to normalize. As I think about Q4, I would anticipate trends roughly in line with typical seasonal declines. While I would certainly like to provide as much visibility as we can given the continued uncertainty from the pandemic and the geopolitical concerns, we will refrain from providing complete Q4 or full year fiscal 2021 guidance at this time. Now I want to talk about our solar space. There's been a lot of excitement lately around this space. I will say that it's been great to see the opportunity in the solar market being recognized, which is validating our investments and building out our next tracker business. I've also said many times that it is our job to continuously evaluate our portfolio positioning, improving the mix, finding and investing in great opportunities and taking a disciplined approach in finding the right way to monetize each of these businesses to maximize long-term shareholder value. I'll finish by saying, I remain extremely confident that we have the right strategy to reach our longer term goals, and that we will emerge from this global crisis, stronger and better positioned for the future. Again, I want to say thank you to all our employees for their ongoing commitment to our customers for their trust and partnership, and to our shareholders for your continued support.

Thank you. [Operator Instructions] Your first question comes from a line of Michael Murray from RBC Capital Markets. Your line is open.

Hi, this is Michael Murray on for Robert Mueller. So you touched on this in your comments briefly, so competitor of next tractor recently went public and being valued very highly right now. So with the overall run up with solar companies, it's pretty apparent that the value isn't being properly reflected in Flex's share price. So, first, could you give us a sense of the size and margin profile of next tractor? And then, just a quick follow up? Are you considering steps to unlock value of this either, with further financial disclosure or a potential spinoff?

Thank you, Michael. We were going to having bets and on whether this would be the first question or not. So, let me start by just giving you a little bit of a view on the next tracker business itself. I'll start by saying that I have known the -- I've been part of the solar business for a long time for my prior role, leading Ethan's electrical business and having played a lot of -- having had a lot of experience with the solar market for more than a decade. So our next tracker business itself is number one in global market share on solar tracker businesses. And it's been that way for the last five years, and continues to be that way. So today, we have installed around 40 plus gigawatt of smart solar trackers, for projects across, five continents. So we're really global in our business here. And not only do we have the tracker product itself, but we have a really fantastic software called True capture, which really focuses on smart monitoring, and as a control software platform, across the kind of solar field. And so over the last few years, the next tracker business has grown from being a few hundred million in revenue to being north of a billion dollars today. And in terms of operating margin, really is in line with industry peers and operates in the double digit operating margin range. So you can see it's a very strong business, a market share leader has had a healthy growth profile, and really has had fantastic operating margin performance and continues to be so I would say that, that lead believes strongly and next trackers market leading technology, and have been investing heavily in that business to grow and support that business. But…

All right, thank you.

Your next question comes from a line of Ruplu Bhattacharya from Bank of America. Your line is open.

Thanks for taking my questions. And Revathi thanks for the details you gave on NEXTracker. I was wondering if you can give a little bit more detail in terms of you said you're making investments to grow the business? Is this a capital intensive business? Can you give us any sense of the debt on the balance sheet of NEXTracker, and what type of CapEx is required to grow that over the next couple years?

Ruplu, I’m not going to go a whole lot beyond what I already said, which is in terms of revenue and margin performance, I would say in terms of what's needed to grow solar businesses in general, and the capital intensity of the business, I think you can read that from any industry reports in general, it's an asset light business, but I think there's enough industry reports on tracker businesses itself, and I'd say we're very much in line with that.

Okay. And then you've been pruning the portfolio and the other side of the business on the CTG, the former CPG and the CEC, and now in the Agility Solutions part of the business? Is that pruning done, or is there still more pruning to be done on that side of the business?

Ruplu, I have said this before is that in our six segments have been clearly defined and setup, including the three within Agility. And how we – our six business units and how we think about our Agility businesses within the portfolio will always be looking to improve our mix, right, to go to higher value customers and manage customers where we don't think there's long-term value for us and the customer. And that's how we are managing it. I've said that I don't see any large scale pruning left to do. But managing within that is always our job. I think you'll all expect us to do that constantly.

Right. And just for my last question, if you can just clarify this, from a strategy standpoint, are we hearing correctly that from a product portfolio standpoint, you would be open to looking at both, assets and the Reliability Solutions segment as well as Agility Solution segments to unlock shareholder value. So if it makes sense to divest those assets, you will be open to doing that? I mean, depending on how things how things go. So from a strategy standpoint, is that the correct way to look at it?

From a strategy standpoint, Ruplu, I think I made it clear in my comments I said before is that, if we need to monetize assets, and they have a better value somewhere else, we'll always be open to doing that. But I've also said that from a long-term shareholder value perspective, we're also focused on investing in our Reliability business, within healthcare, and automotive and industrial, because we think that long-term, the best value for our shareholders comes from investing in those businesses and driving growth and profitability in those businesses. So you have to look at the strategy holistically. I think they have both parts of that to execute on.

Thank you for all the details and congrats on the quarter.

Thanks, Ruplu.

Your next question comes to a line of Mark Delaney from Goldman Sachs. Your line is open.

Yes, good afternoon. Thanks for taking the questions and congratulations on the strong results. So going to start with a question also on NEXTracker and remedy you mentioned, looking to be open to best monetize and create shareholder value. Can you give us any more details that have such plans to measure or gauge whether or not you think Flex is receiving fair value for the NEXTracker business?

Yes, I'd say, Mark, how I would say is that we feel that NEXTracker is a great asset. And how we're managing and how we're going that business within our portfolio. And I think in terms of the value of each of our businesses, not just NEXTracker, because the other fantastic businesses within our portfolio will be measured, based on independent businesses that exist in their space and the valuation that is that's assigned for those businesses. So I think that's the only big picture answer I can give you, Mark. But I just want to make sure I go back to the question off, that there are many assets that we think are great, great assets, we're really pleased that people are recognizing that there's power to those assets, and that our valuation should reflect those assets. So we're super excited about that. And they're be, assets that will monetize. But they're also be, other places that will invest. And that's how we should think about this story.

That's really helpful. And thanks for all the other comments you made on that business. I think it's helpful for investors. My second question that, I wanted to touch on your comment about, seasonality in fiscal 4Q. And when I look back, historically, the range has been approximately down 5% to down about 15% quarter-on-quarter. Is that what you're alluding to when you're talking about seasonality? And I do ask to clarify, just because as the company has been evolving its mix businesses, there's been a bit less consumer exposure, which that's one of the businesses in particular that has historically created that that seasonality in the March quarter. So I'm curious, is that the sort of the historical numbers? Is that the right way to be thinking about it? Or is there some sort of new seasonality we should have in mind for the March quarter?

Yes, Mark, this is Paul. I do think that's the right way to think about it. I think over the last several quarters, the company has done some pruning that that in theory down the road should have an effect on seasonality. But if you go back in time and just look at the history, it's been a 10% – 10%, 11%, 12% sort of a sequential decline from seasonality as we've moved from our fiscal Q3 into the fiscal Q4 and I don't think you'll see a significant change to that, as we move ahead into this upcoming fiscal Q4. There's a lot of moving pieces with this, as you can imagine, the comps are interesting as you come into the year-on-years in Q4. But given the snapback effect and what may or may not happen in healthcare, we certainly are expecting some quarter-on-quarter top line contraction, as we move into Q4.

And Mark, the only thing I'll add is that, yes, we've definitely reduced the seasonality effects in Q4 from what we’ve historically had just because of how our mix has shifted. So there's definitely some improvement because of that. But we do think that there will be some seasonality because it's post holiday season and things like that. And also that, COVID really adds some confusion to all those stories in terms of how we see these quarters play out also. So there's, I think, some, some predictability issues because of that.

Thank you very much.

Thanks, Mark.

Your next question comes from the line of Matt Sheerin from Stifel. Your line is open.

Thank you. Yes, thank you. I wanted to ask about your – the Datacom part of the agility solutions business, the telecom, the cloud business, which seems to still have some fairly good traction, and then also the infrastructure products and networking, servers, storage where we are seeing weakness and continued weakness and on-prem. Are you seeing any signs from your customers, that they're expecting a turnaround at all in that business anytime soon?

Yes, I think what we have said is that we're not seeing an immediate turnaround in that business. And that's what we reflected in our, even in our script. And I think we're hearing that consistently from our customers, too. So I think our overall view is that we see critical infrastructure investments continuing, we see that that will be reflected in cloud. But we do see that enterprise spending will continue to be weak in that space. And that's kind of how we think overall, our CEC business will operate.

Yes, just, I'll just pile on that a little bit. I can't imagine there's many CFOs out there who are – want to invest heavy in enterprise right now, given the pandemic. So that will probably, like Revathi said, continue to be a bit soft. I also have read some external stuff about cloud that is saying that maybe there's a little bit of digestion coming into the calendar year Q4 that might be a bit of a watch item. But as we mentioned in the prepared remarks, we are expecting about flat, CEC moving from Q2 to Q3.

Yes.

Okay, great. That's helpful. And then, Paul, just a question on the OpEx line, you did talk about some of the austerity measures going away. So I guess there's some expenses coming back. So what should we be thinking about SG&A over the next quarter or two?

Yes, so SG&A, you look back six to eight months ago, I think we had talked about 3% to 3.2% or something like that, that's kind of how I would be thinking about it if I were you as we move forward. There is going to be a little pressure as you alluded to austerity measures are rolling back. And we continue to have COVID costs. COVID -- all the questions have been next tracker, but COVID is going to be a -- continue to be a headwind for us in Q3 and Q4. So, maybe a little bit of pressure there. If I kind of think about the walk -- out margin walk just from Q3 to Q4, volume is not significant quarter-to-quarter, up maybe $200 million and I don't see a whole lot of drop through on that. COVID is probably neutral from quarter-to-quarter, but we do have headwind from austerity measures maybe a little bit of talent from other productivity. But look we're going continue to be disciplined as we've said before and do our best to keep the controllables in the box.

Got it. Okay. Thanks a lot.

Your next question comes from line of Paul Coster from JPMorgan. Your line is open.

Yes, thanks for taking my question. First off, any sort of puts or takes that you can think of that might arise from the composition of the next Congress and presidency post the elections, for instance, greenish tinge to the infrastructure spends, is that good or bad for you?

Yes, I'd say two things one is -- I'll first start with trade even though your question was on green pause say that on trade we expect spread the overall kind of based on -- whether President Trump continues or we have a new government, we think the focus on China continues to some extent. We believe that the focus on regionalization will continue to be a conversation across our customer base just to derisk whether it is due to geopolitical issues or whether it's related to health pandemic issues. We think the Green investment is a is a plus for us. We have a fairly large energy business that will benefit from that. So, we're bullish in terms of the investments that have been outplayed in terms of the Green Energy program and if that pans out, we view that as a plus.

Unfortunately over the next track, couple of quick question. Can you give us any sense of how much higher than $1 billion, your app in terms of revenues there? And then you mentioned twice long-term shareholder value and of course pullback and -- but in this particular case that even if you're approaching synergies and adding value in the running of that business, you just can't get that kind of valuation [Indiscernible] inside a larger company, so it feels like short-term and long-term, basically trying to enter here that you have to kind of go with where the market valuation is telling you to close the asset.

Yes, Paul maybe you missed the first part of our comments, we did say that the business size in terms of revenue is a little north of $1 billion. And the operating margin is in line with industry peers in terms of double-digit operating margin. In terms of the comments at Star pricing, I made a holistic comment that we will look at ways that we can identify and monetize any opportunities we think that is better valued externally than internally if that needs to be the case. But we know our goal and focus, obviously is to create long-term shareholder value. So, in terms of monetizing assets and investing in assets, they all go into the picture in terms of how we make these decisions. And that's my long term shareholder values is an important theme for us and our long term shareholders. They've been very clear about that also, so you have to think about both sides of this equation.

Okay. Thank you.

Thank you, Paul.

Your next question comes from a line of Steven Fox from Fox Advisors. Your line is open.

Thank you. Good afternoon. Couple questions on the reliability solutions business the margins under the new structure the best you've had in the – in the six quarters we're looking at, the incremental margins are 12% year-over-year 15% quarter-over-quarter. So can you sort of explain how much of that improvement is mixed versus just natural operating leverage versus better cost? And then secondly on the auto piece of the business you're saying that it's going to be down year-over-year for the rest of this year fiscal year, I guess, what are the external factors on that I mean is it just because of global production or is there any customer specific geographic models specific things going on there? Thank you.

Yes. Thanks, Steven. So in terms of reliability margin, I'd say, it's a combination of things one is obviously the Health Solutions business having a strong performance in the quarter. With all the kind of work they have done for COVID related work, definitely helps in terms of improving the overall business performance. I'd say industrial was pretty much in line with what we have typically seen from the, from the industrial businesses and automotive while it had a good snapback from Q1 is still down year-over-year basis right so. And so I'd say, if I think about all of that holistically and we had, kind of the mixes of COVID costs and auto benefits that somewhat narrow off each other, but provides some upside to make the margin performance for that business pretty strong. So if I would say that good performance overall we're running the business in a more disciplined way that's a huge plus, we have gotten benefits from COVID upside that helps. They have auto recovering which was – which was a plus and how we're managing that recovery is really good and industrial is kind of performing as we expected to. So I think good performance across the board and a combination of factors of growth and productivity. In terms of auto being down year-over-year, whether we like it I adjust or not that's kind of the best, indicator in there that so far, where the markets going they're calling auto right now at 18% year-over-year down. We think we're actually going to be better than that. And the reason will be better than that it's just because of the underlying trends of where we participate in the auto business. Where we have more – more in electronic – in things like electrification and connectivity and electronics components, which provide the higher value per car really helps us better than the overall IHS numbers. So we think we'll be better than the minus 18%, but the underlying trend threads down and we're going to be better than that as our as our view on it.

Great. That's very helpful. Thank you.

Thanks, Steven.

Your next question comes from the line of Tim Yang from Citi. Your line is open.

Hey. This is Tim Yang calling on behalf of Jim Suva. The follow up question on automotive, I think you've guided December quarter automotive to be up low single digit. I think this is below auto production growth forecasts from IHS approximate 9% to 10% sequentially for the quarter. So maybe can you just elaborate about like why your sequential graphs it's a little bit below although production for the quarter is in more like an inventory or customer specific issues or something else?

So Tim, do me a favor. Can you repeat the first part of that question?

So your December quarter guidance automotive is like low to mid single-digit quarter-over-quarter. And then I think, for auto production forecasts for December quarter from third-party agencies and they're forecasting 9% to 10%. So can you may be just address on why your sequential growth in the developed the forecast?

Yes, sure. So, let me take that and -- so you got to look back to where we were coming from. So you go back to Q1. I mean we had trough like we hadn't through in a long time. I mean automotive year-on-year was down – call it 50% or so, that snapped back significantly in Q2 and as you probably heard in our prepared remarks, we were up high single-digits and automotive. Looking ahead to Q3, now this is I'm pivoting to a sequential basis saying -- we'll probably up, be somewhere between low to mid single-digits sequentially. So continued recovery, but that is still down. To [indiscernible] this point on the – prior question from Stephen, look, IHS whether you like it or not continue to project down, pre, automotive rates below pre-COVID levels and down high-teens year-on-year. So if we can print a mid single-digit, high single-digit down year-on-year performance like we did in Q2 to me that would be a win, and it would be a win for the reasons that Revathi mentioned. We're growing other parts -- think of cost -- think of it share of wallet, if you will, areas like autonomy, electrification, connectivity those are all great, and in our space and as that share of wallet grows, we should outperform overall, automotive,

And I think from a sequential perspective Tim the way, I think about it is that, we could be more conservative for sure and one of the reasons could be that, we're trying to manage kind of the timing of orders, supply constraints and things like that. We're trying to manage for the automotive business because it's had a pretty big snapback from where it was. So, I think you could say that could be the difference between where we're at and what you're saying the projection is that of 9 to 10, but it's constrained -- supply constraints are better and we're able to get all our shipments out, it could be better than what we have in here.

Got it. This is very helpful. In the past I think Flex benefit from the major gaming console ramping in the holiday season. Would that be the case for Flex this year or your exposure to that and the market had actually changed?

No, I really don't even know what our exposure to that is. So I am assuming it's not that big. So it's not significant for us.

Got you. Okay, great. Thank you.

Okay. Thanks.

Your next question: comes from line of Shannon Cross from Cross Research. Your line is open.

Thank you very much. Revathi, you did well across the board to large extent this quarter. But I'm wondering, what areas had sort of the most outperformance or surprise you relative to where you were, forecasting for the quarter, I don't know, maybe auto, but I'm curious as to sort of where you saw the most upside? And then perhaps where you see the most upside in the current quarter that we're in, and then I have a follow-up for Paul. Thank you.

Yes, thanks, Shannon. Yes, we did do well kind of across the board on all metrics. And you nailed the most important one that was much better than what we expected, which was automotive, but frankly we had the upside in quite a few segments. Our lifestyle business performed very well and that came from, continued strength and appliance and floor care. And that was pretty strong so that was a positive, from where we thought things were. We had already mentioned that we expect to see C2B strong because of the infrastructure investment and we were able to make a lot of those shipments. So that definitely helped us. I would say, on the – Consumer Devices did rebound from a low, but it was lesser than what we expected, because of emerging markets being slower. So that's kind of how overall Q2 played out. So -- and then, I’ll say, looking forward what we're hoping for from an opportunity standpoint is that automotive continues to snap back, like I talked about, if we can manage the supply constraints for China and at the same time, with all the noise around COVID in Europe, and continued shutdowns happening across the world, we're kind of watching that very closely also. So, those things could swing things pretty quickly.

Yes. I think that's a good caution.

Yes.

Great. And then, Paul, granted you’ve only been there a few weeks, but I’m just curious, where you're seeing perhaps the most opportunity, as you sort of balanced what you've -- you've seen in the last few weeks with what you did in aero – I was going to say Aerojet Rocketdyne. Sorry.

Sure. So, if there were to be one observation that I would have it would be this and this is based on going through a number of different factories, either in person or virtually, incredible amount of capability with the company. And we make highly engineered products, just ridiculously small, highly engineered products at an incredible rate. And our ability to sort of pick up operations and move them from one part of the globe to another is just incredible. So, I guess, the one surprise for me maybe would just be margin rates. Given the capability scale of the company, it's – I'm a little surprised that in some cases we run at low single-digit margin rates. And so that would be, sort of, my first observation. And my question would be, how much is – how much of that is blocking and tackling discipline stuff? How much of that is just sort of consistent with the EMS industry and is there room to grow. But, I think, where Revathi and I have been completely aligned since this process, started this summer, is focusing on disciplined execution, how can we get the margins up, how do we change the overall mix of portfolio, to change the profile of the business into a more predictable higher earning company. And that's -- to Shannon answer your question, that's going to be my focus over the next several quarters, years.

Great. Thank you very much.

Thanks Shannon.

And your final question comes from a line of Christian Schwab from Craig-Hallum. Your line is open.

Hey. Congratulations guys on a great quarter in this environment. My question has to do within the prepared comments. We talked about all of the changes and product repositioning that we're doing. And thought of yourself more of like a diversified manufacturing business, not an EMS business. And I assume that's because you think the multiples that you historically have gotten is too low. And I'm wondering if you could give us an idea of some of the companies that you have in mind that you think your business is more similar to then just be considered a contract manufacturer.

Yes, Christian. Hey, thanks for that question. Yes. So I think you have to think about our business in two parts, right? And the reason we have gone to this two business segment model, which is the reliability and the agility segment would be because the agility segments functions more like the traditional EMF business or the traditional contract manufacturing business. And then at the same time, when you think about the reliability business which is in high value businesses like Health Solutions and automotive and industrial, that really functions like any of the diversified industrials functions, right a lot of technology investments, long customer affinity cycles, very difficult manufacturing processes. So, I would say that for the liability business, we definitely feel that our multiple should be a lot higher than what we're getting as time. So that is how I think about it and I would put it in, obviously, if I'm telling the story which I am Christian and thanks for this question I'd say that what reliability should get assigned is a diversified industrial multiple, and you should be able to pick any of them and say, you look at that group of companies and you should be able to assign that multiple for our liability business. And I think agility gets the traditional EMS multiple, but as we continue to move that business in terms of how we run it and how we manage it that will shift. But that's the -- how I look at the two parts.

20 times EBITDA sounds pretty good to me Christian.

I appreciate that. I don't have any other questions. Thanks.

Okay. Thanks. Thanks for the question Christian.

Great, thank you Christian so see as I wrap up I'll just say, thank you all for joining us today and, even though these are unprecedented times. I'm sure this quarter gives you a tremendous amount of confidence in the future of flax and it gives us too. And I respect all of you just remain safe and in great health and we look forward to talking to you again next quarter Thank you,

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