Cimpress plc
Q1 2012 Earnings Call Transcript

Published: 28 Oct 2011

[Operator:]

Ladies and gentlemen, welcome to the Vistaprint Fiscal Year 2012 First Quarter Question-and-Answer Earnings Conference Call. My name is Laura, and I will be your operator for today. This call is being hosted by Robert Keane, President and CEO; and Ernst Teunissen, Executive Vice President and CFO. Before we take the first call, as noted in the Safe Harbor statement at the beginning of the earnings presentation, comments may include forward-looking statements, including statements regarding revenue and earnings guidance, and actual results may differ materially. Risks that could impact those statements are described in the documents that are periodically filed with the Securities and Exchange Commission.

[Operator:]

Now we'll proceed with the first call. Your first question comes from the line of Youssef Squali.

[Youssef H. Squali:]

So a couple of questions. First, I guess starting with you, Robert, if I look at Q2 and fiscal 2012, particularly at the low end, it basically implies year-on-year growth, which is below that 20% CAGR you're hoping to achieve through 2016. Maybe can you just walk us through the different growth dials that you can basically tweak to reaccelerate growth, which you'll obviously have to do starting, I guess, in second half of -- or starting in 2013 to get there? And then the other thing is on the Albumprinter acquisition. It seems to us that that's mostly a B2B2C cost play, which is different than what you guys have done so far. It looks like the majority of the revenues are not direct to consumers. So can you speak to the rationale behind that deal and what you're hoping to achieve with it?

[Robert Keane:]

Why don't I start with that, then I'll go to your growth question. Obviously, the growth forecast, just to be clear, that I'll talk about in a moment, are excluding Albumprinters. So I will answer the Album question, but just to be clear, the following one does not include that. So you're right. They have a significant amount of B2B2C. In other words, they sell to one of the largest retailers, a retail brand in the Netherlands, who then sells on as well. But they have approximately half and half between direct to consumer and going to consumer, a little bit like we do with our FedEx Office. Or now our Staples approach. We're selling through another brand. So the logic behind the deal was really -- what we liked about Albumprinter is they have a great product, great team, great software, but the reality is 75%, 80% of their revenues are in the Netherlands. And we have excellent distribution and customer base from Poland to Portugal and Ireland to Turkey, across Europe. And so their product line, they've recently translated into a number of different European languages. We can translate it into more. So what we were buying was something which was being valued predominantly on their existing Dutch business, which, to your point, is half via strategic partnership-type relationships. But we felt that in terms of getting up to a high quantity of production so we could have economies of scale and having a top-quality software, they gave us a much faster time to market that we could then push through other parts of Europe. In terms of the growth numbers, you're right. If you look at the guidance of where we are, it comes in -- for the Q2 guidance, I think it's 15% to 24% constant currency and reported currency right now. And you could have similar types of ranges when you route into the second half. Obviously, that's our guidance range. We stick by the guidance range we gave, but we, of course, would like to be above -- the middle of that range or if we can, certainly, I don't want to say the guidance range did anything different than the full range. But we're quite early in the year, and we think it's best to keep that type of breadth. We still very much do feel committed that we can stay above this 20% annualized CAGR growth and would like to do that this year. We said many times that these investments are long-term investments, and we do know that we are having some revenue headwinds we've seen in the last quarter by some of the things we are doing that we believe will increase customer loyalty. So as we've turned down e-mail marketing or as we've reduced cross-selling or as we've done other types of things which reduce revenues in the near-term, we believe that will come back, and the other -- the year and beyond. But there's not variability around those forecasts, so we felt it was better to have this breadth of forecast range.

[Operator:]

[Operator Instructions] Your next question comes from the line of Ingrid Chung from Goldman Sachs.

[Ingrid Chung:]

So just a couple of questions. You saw a deceleration in revenue growth internationally on a constant-currency basis from 25% in 4Q to 20% in 1Q. Which regions were strong and which regions were weak internationally? And what are your assumptions for these regions that are embedded in your guidance for 2Q? And then secondly, I think it says in the materials that you spent $5 million in broadcast TV in the U.S. in the first quarter. How does that compare to what you're planning for 2Q, and what are you planning in terms of TV advertising outside the U.S. in 2Q?

[Ernst Teunissen:]

So if you look at some of the international growth rates we saw in Europe, we saw 21% constant currency growth, which, if you would compare it to the previous 2 quarters, was 22% in both Q3 and Q4. Asia-Pacific did very well. We had 45% constant currency growth in Asia-Pacific, up from 39% constant currency growth in the fourth quarter. And then North America delivered 17% constant currency growth, which is down from 18% in Q4 but up from 15% in Q1 a year ago.

[Ingrid Chung:]

Well, I guess, within Europe, were there certain regions that were stronger than others, and what was leading to the deceleration there? And are you assuming the same sort of trends into the next quarter?

[Robert Keane:]

We don't break out subgroups of those regions to say we're doing well in Spain or poorly in Germany or any other combination. That being said, we clearly met our expectations for revenue, and I would say that's the case by each geography. Looking forward and speaking to Youssef's question a moment ago, if you look at the midpoint of the revenue guidance, they're around the 20%. We expect we will be able to see -- to the extent we do succeed, and we think we can succeed in our strategy of reinvigorating growth rates, that will happen across the border. It certainly happened in North America and Europe. Not at perfectly equal percentages, but both of them, we are shooting to accelerate looking forward both for this Q2 and the second half of the fiscal year. For the television advertising, do you want to take that one?

[Ernst Teunissen:]

So we have a significant, as you know, increase over advertising budget for the entire year. We spent about $35 million more than if we would have maintained the same advertising as a percent of revenue compared to last year. And that is relatively weighted more towards the latter half of the year for TV advertising. We've done some TV advertising this quarter, and we'll do some more in the next, but relatively speaking, TV advertising is more weighted towards the third and the fourth quarter.

[Robert Keane:]

And we are testing in Europe, and we did quite a bit of testing this last quarter. It's still relatively early, but we definitely have successes that we saw.

[Operator:]

Your next question comes from the line of Shawn Milne from Janney Capital Markets.

[Shawn C. Milne:]

Just relative to your guidance for the first quarter, it looks like a penny or 2 from the share buyback, but was the TV spend a little bit more delayed than you thought going into the quarter? The marketing cost was below what I was looking for, that you didn't exactly guide, of course, TV spend in the quarter. If you can add some color around that. And just going -- I wanted to think about gross margins for a second. What's the pushes, sort of pushes and pull there in the next couple of quarters? You saw a good digital growth, but I know your -- partly, your initiatives were to, perhaps, work down your shipping fees to customers which might bring down the gross margins a little bit. Can you walk us through that?

[Ernst Teunissen:]

So to start with your first question about advertising spend, so we spend about 220 basis points more on sales and marketing year-over-year. That is lower than what we have said. What we had guided earlier on is we would spend as a percentage of revenue over the full year. And that has to do with the timing that I talked to you earlier about, about when we face some of these advertising dollars in the year. And then there were just -- as a source of the overage on EPS as a percentage, we did spend a little bit less on marketing than we anticipated for the quarter, and we had some favorability in some of the OpEx lines as well. So we came out favorable in that respect. Your question on the gross margin, and specifically you were asking the impact of some of the changes we're making in our business and our strategy?

[Shawn C. Milne:]

That's right. Just more on shipping charges to customers maybe partly offset from the strong growth in digital.

[Ernst Teunissen:]

Yes, so the growth in digital obviously has a positive impact. You're right about that. And we had -- if you compare year-over-year, we actually had a slightly favorable gross margin compared to Q1 a year ago. There is some seasonality in gross margin for us. For instance, this Q1 is a quarter where there's a relatively high percentage of T-shirts and textiles, which has a different gross margin profile than in other quarters. So sequentially, from the fourth quarter, we saw about 70 basis points lower gross margin, and if you dig deeper in that, you do see things like labor efficiency in the fourth quarter versus the first quarter and some impact on materials. But year-over-year, we were almost flat on gross margin, and we have guided -- for the full year, we have guided to be roughly flat on gross margin. And that is a bit of a put and take. So we are going to see some improvements in our gross margin and bottom line year-over-year from a productivity perspective. But then we do have some of these headwinds from the strategy we're implementing that you just described. So net-net, we estimate year-over-year, we're going to be roughly the same, which we did in the first quarter.

[Meredith Mendola:]

But Shawn, in this particular quarter, I wouldn't attribute anything with gross margin to shipping pricing because we really haven't begun that. And this year, as we talk about that, it's going to be a testing situation, not a full-scale rollout.

[Operator:]

Your next question comes from the line of Jim Friedland from Cowen and Co.

[James H. Friedland:]

I just wanted to dive into the photo album acquisition and what that might mean for adding photo storage and photo sharing just because we've seen with Shutterfly by putting all that together that's really helping out their business. Is that something that you think you'll add to the mix as you roll it out? And then on the back of that, thoughts of bringing that business to the U.S. and then maybe margin profile of the business.

[Robert Keane:]

Okay, so speaking to the photo storage, one, in Europe, Europe is a very different market in terms of what market -- what the customer wants in terms of the structure of the software. It's predominantly a client server model where the software is downloaded to the customer's PC, and then the final layout is uploaded back up, and that's very much the architecture that Albumprinter users. So one, that's a great advantage. The customers' photos are already on their local PC, so we don't have as much photo storage to worry about. They do have photo storage. It's available, but it's a de minimis cost when you look at the big picture as a percentage of revenues. The margin profile of that business, Ernst, do you want to touch...

[Ernst Teunissen:]

Yes, so the EBITDA margin in the last trailing 12 months, for instance, was in the mid- to high teens, 16%, 17%. Net income margin is about 8%. The gross margins are lower than our gross margins, which is inherent in the product and the business that they're in. But when we look at the EBITDA and the net income margin, we see business that, on that basis, is not too far from our own in terms of bottom line profitability.

[Robert Keane:]

And Jim, as to your last question about coming to the U.S, we certainly do not have any plans to take the offering out to our customers outside of Europe. We believe that there is a huge opportunity for us to bring this to our European customer base, as I mentioned in your request to -- in response to your prior question. But we, today, have a very significant and successful Home & Family business worldwide, but it is actually quite concentrated, as we said before, in Europe. And so we believe that's where we'll focus.

[James H. Friedland:]

And in terms of the gross margin, so once the business is in for a full quarter, should we expect the gross margins to get weighed down a bit, or it just wouldn't matter?

[Ernst Teunissen:]

It is not going to make a very significant impact if you look at the relative orders of magnitude of their volume. So we're forecasting $1 billion of revenue in that range for our business, and it’s roughly -- we're saying we're adding about $40 million for this business, so it's 4% of revenue. So it's going to make a little bit of impact, but in the grand scheme of things, not a huge impact.

[Operator:]

Your next question comes from the line of Mark May from Barclays Capital.

[Mark May:]

I apologize if these have already been addressed. On the guidance, and please correct me if these numbers are wrong, your guidance for revenue of $960 million to $1.01 billion, was that down, it looks like, about $20 million from the previous guidance? What are contributing to that? Is that FX, and if so, could you maybe quantify that? And then I know this must also include now revenue from Albumprinter. How much are you including on a USD basis? I assume that's, I don't know, $50 million or $60 million.

[Robert Keane:]

Yes.

[Mark May:]

I think they're kind of related to the kind of questions on revenue guidance and the components. It looks like you also -- you raised EPS guidance, so is there some change in, I don't know, tax guidance?

[Ernst Teunissen:]

Yes, let me take you through that because what we've done is we've guided to the end of the year for our core Vistaprint business, and then we have said -- really, because the transaction with Albumprinter hasn't closed, we've done that guidance. Then we said this is what guidance would look like if the transaction would close. So let's start first with our Vistaprint core business. So we have -- purely for currency exchange, we have, on both sides of the range, lowered our guidance by $20 million. So this is not a change of guidance of our operational business. It's purely for currency. And the way we do that is we pick a point about a week before this earnings call, and we do a 30-day trailing, and that is what we use. So that's purely -- that's $20 million. Then if you go to the Albumprinter impact, we say for this fiscal year, obviously, if it's close within a week, we would have 8 months left in the year, in our fiscal year, of revenues and we've guided to a $37 million to $39 million of revenue there, so...

[Robert Keane:]

Incremental to the number.

[Ernst Teunissen:]

Incremental to the number.

[Mark May:]

Okay. And that's USD, obviously.

[Ernst Teunissen:]

Yes, it's dollars. So net-net, we're going to end up $17 million to $19 million higher than our original guidance, if everything is said and done.

[Mark May:]

Is there a change in tax guidance, tax rate guidance?

[Ernst Teunissen:]

No, we've not changed any tax rate guidance. We haven't given any tax rate guidance, to begin with.

[Meredith Mendola:]

Mark, the difference in EPS is as a result of the buyback activity through the beginning -- the difference from the last time we gave guidance through to last week.

[Mark May:]

Okay, that makes sense.

[Ernst Teunissen:]

So again, for EPS, there's a 2-step thing. We had a guidance out in July of $1.10 to $1.20. Again, not for operational reasons, but for 2 other reasons, we have actually increased that guidance for the rest of the year to $1.19 to $1.29. It is $0.10 accretion through the recent share buybacks, and it's $0.01 reduction because of the upfront fees we have paid for the $250 million credit facility that we set.

[Mark May:]

Okay, that makes sense. And then second question is it looks like that your marketing as a percent of revenue is $0.24, which was below your full year guidance of $0.25 to $0.26. So question is

[Ernst Teunissen:]

Yes, the answer is yes. So if you look at our advertising expense, it was 24.4% in this quarter. And indeed, you're right. We have indicated a higher number for the year. That hasn't changed, and as I said earlier, some of the advertising spend, for instance, our TV broadcast, is relatively weighted towards more to the back end of the year.

[Operator:]

Your next question comes from the line of Scott Devitt from Morgan Stanley.

[Zachary Arrick:]

This is Zach for Scott. I just have one simple question. You guys talked about the revenue contribution, about $100 per user, and I was wondering, what do you think gets you to, like -- do you have a target contribution? Is it $150? Is it $200? Is it $1,000? Or what gets you to your target?

[Ernst Teunissen:]

Sorry, the $100 is?

[Zachary Arrick:]

It's like $150...

[Ernst Teunissen:]

Yes, so the math that we've done, it's an average math, and obviously, we look at this by channel and by segment. What we want to illustrate on an average basis is if -- an average customer that we bring in, the expected lifetime value in terms of bookings is $230. So if we take our current gross margins, 65%, that will lead you to an expected gross margin contribution over the lifetime of that customer of $150. Now our average COCA is $27. So there's obviously a difference between the $150 and the $27. And the reason why we talked about this is as we look at individual investments we're making at individual campaigns, in channels or in markets is we look at the longer-term, the lifetime value as an indicator of how far we're willing to go in terms of letting our COCA go up. So if you see our COCA go up and we wanted to paint the picture, on average, there's a delta between $150 of gross margin value and the $27 that we spent for it. So if we see that $27 go up for certain channels to even double of that, there's a very significant, still, economic logic of doing that, although it increases your average COCA. So we're trying to say that we have some headroom here in terms of pursuing channels economically.

[Zachary Arrick:]

Right. But I was wondering -- I realized that COCA might come up, but I was more interested in seeing if you guys have a target for increase in the lifetime value bookings above that $230? Because as you're investing in your customer with the initiatives, I would think that that could raise over time, and I don't know if you have a target lifetime value.

[Robert Keane:]

Yes. Robert speaking. Yes, we do expect that to go up. We do not have a target that we talked about publicly. I'm looking at Slide 17 in our presentation today, and you'll see on the left of the number you're talking about, on the left-hand side of that slide, there's an annual look, and you go back for the last 5 or so fiscal years, in the Q1, and you see that the bookings per customer, trailing 12-month bookings have consistently gone up from $59 to $73. Now these are multiple years to get to the $230. So A, there's been a historical -- this shows 5 years, 10 years of historical data where we've been able to increase it. The $230 is not assuming future increases. That being said, both based on historical work and the intensive work we're doing in terms of the customer value proposition improvement, we believe that that number will go up. But we do not have a publicly stated target for that.

[Ernst Teunissen:]

And in addition to the revenue per customer going up, one of the targets of our customer loyalty initiatives is to get our retention rate up. So that lifetime value is a weighted number weighted by all the people that you're [indiscernible]. So if you increase retention even without increasing revenue per customer, that lifetime value goes up as well.

[Operator:]

Your next question comes from the line of Mark Zgutowicz from Piper.

[Mark J. Zgutowicz:]

Robert, just curious, you had talked about to the backing away from the cross-sell, e-mail marketing initiatives. I'm curious when you began sort of backing away and when you started to hear some of the positive feedback from your customers after doing that?

[Robert Keane:]

We tested it quite a bit last fiscal year before this quarter, and if you go back and look at our quarterly releases, we spoke quite a bit about some of the testing starting even a year ago. And so the results we saw, a number of different tests looked positive, and then we really rolled it, more and more of it, out in the last 3 months. We continue to both roll out things we have tested and do additional testing in these types of areas. So it's an ongoing process.

[Mark J. Zgutowicz:]

So you've been testing that for a while. You've been seeing positive feedback, but you're bringing down revenue because...

[Robert Keane:]

They were actually -- in the near term, it reduces revenue. In the long term, we believe it will increase the loyalty and retention rates of our customers and, therefore, going back to answer that Ernst gave to the prior question, increase the lifetime value of the customers.

[Mark J. Zgutowicz:]

Okay, fair enough. And then just shifting to Albumprinter, I'm just curious. I see the seasonality sort of fits with your consumer business. I'm curious, for the rest of the year, is it similar in terms of linearity?

[Robert Keane:]

It does have -- about 35% of the annual revenues come in the December quarter. So it's a little bit less seasonal than our overall consumer business, but it is seasonal. There's a slightly smaller peak around the September quarter, post-vacations, where products are purchased. But definitely, in terms of revenue, you see that seasonality. We also see that much of real strong majority of their profits are made during the December quarter, which is similar to standalone photo product companies you may be familiar with.

[Mark J. Zgutowicz:]

Okay. And I'm curious if you could talk about levels of investment that you'll be making in Albumprinter in terms of integration and marketing? Obviously, it's a new product that you haven't sold. Just curious, I know you'd indicated FY '13 to be accretive. I'm curious if there's a level of investment that might need that accretive-ness as it relates to FY '13 versus '12?

[Ernst Teunissen:]

So you're asking what the accretive-ness in the following year will be?

[Mark J. Zgutowicz:]

Yes, I'm asking if the accretive-ness in '13 is going to be as much as -- just take December, if you expect to see the same accretion in December next year as you would see this December.

[Ernst Teunissen:]

So if you don't think -- that little bit is on the Slide 24. We try to identify some of the costs that we see as one-off just before this transaction and would not be recurring, it allows you to back some things out. We have a nonrecurring transaction integration cost of about $2 million, of which is about $1 million in this Q2 quarter. So with that, you're able to come to a forecast for next year. Obviously, this Q2 impact is only for 2 months. It's just November, December. Next year, we'll have September as well -- sorry, October as well.

[Mark J. Zgutowicz:]

I'm just trying to get a sense of what that investment level would be. I know you're calling it nonrecurring, but I'm just trying to get a sense of what the global investment would be through, say, December of next year. I guess I'm just trying to get a sense of how much you really need to invest here to get the return you're expecting from Albumprinter.

[Robert Keane:]

We don't think it'll be a lot. I think we are going to give more detail next week after having closed the transaction. We certainly expect to market the product across Europe, and that incurs some costs, but most of those costs are relatively modest because we're marketing to our existing customer base. So net-net, I don't want to put the cart before the horse before we come out with the post-close guidance, but we do expect '13 and beyond should be accretive.

[Operator:]

Your next question comes from the line of Mitch Barlett from Craig-Hallum.

[Mitch Barlett:]

Well, you talked about retention a little bit, but are there any metrics that we can start to benchmark retention on, what it was a year ago, what it is now, what your targets are?

[Robert Keane:]

We have not yet published specific things or metrics which you can benchmark from one year to the next. We do anticipate doing that over the next 3 to 6 months.

[Mitch Barlett:]

Perfect. Given the kind of delayed nature of some of the investments and then the response from the consumer, is that a process that really takes hold this year, next year? The improvement in retention.

[Robert Keane:]

I think some of that will be seen in the near term, but the real fruits will be over the longer term. Now if you look at our revenue guidance, certainly, the midpoint assumes a flattening of growth rates off of a larger base. We said publicly several times we hope to ideally accelerate about 20%. So that is in spite of headwinds we're seeing that I spoke to in one of the answers to the prior questions. We are seeing headwinds, reducing revenues as we've reduced some of the cross-selling or the e-mail marketing intensity. So in spite of that reduction, we still are looking at good revenue growth. So I bring that up because it shows that some of the benefits are accruing in this year to offset that reduction.

[Mitch Barlett:]

You're basically saying that the upside of your guidance is the effectiveness of the retention program? Is that what I heard?

[Ernst Teunissen:]

No, the upside of the guidance is -- we have given a range of where we see potential outcomes coming. It's not just retention, it's a multiple...

[Robert Keane:]

Advertising is an example.

[Ernst Teunissen:]

Advertising effectiveness, multiple parts of our strategy.

[Robert Keane:]

But I guess what we're trying to say is, to your questions, although much of the benefit will be over the longer term, i.e., out of this current fiscal year, we do believe that we'll see retention cost improvement relatively soon. The real payoff comes out in future years.

[Mitch Barlett:]

Got it. And as far as advertising, have you started to directly target subgroups like consumers at digital, or is that in the plan for this year at all?

[Robert Keane:]

Okay. And when you say consumers in digital, did you mean one being on Home & Family product line?

[Mitch Barlett:]

Yes, sorry.

[Robert Keane:]

All right. So we do a little bit of advertising for that product line but, relatively speaking, not a lot because the cost of customer acquisition relative to the lifetime cash flow of the consumer is more challenged in that market than it is in the small business market. There other exceptions. We certainly do, do that. In the digital market, so for websites and the like, we dominantly built a business, again, there are some very minor substance, but predominantly, we've built that business by cross-selling to our base as well. So all of them are in very different worlds. One is websites for small businesses. One are things like baby announcements or holiday cards. Both those businesses are adjacencies we've moved into by leveraging our customer base where we've already amortized the cost of customer acquisition on the small business product, the physical small business product as opposed to going out in a direct customer acquisition mechanism.

[Mitch Barlett:]

Okay. So no plans to really make a major push into digital, directly getting subscribers into the...

[Ernst Teunissen:]

No. The reason I would say we would not want to do it is -- and you can see this in other small business marketing companies that are in purely digital. Often, we get a lot of questions about our cost of customer acquisition going to $26 or $27. That's 5x to 10x less than what you see in the cost in the direct acquisition. So one of our greatest strengths, we have a very nicely accretive digital business because we don't spend that marketing cost there.

[Mitch Barlett:]

And you previously said that your digital business was your fastest-growing subcategory. Is it still?

[Robert Keane:]

I'm not sure if it's fastest. It's certainly a fastest -- I'm not saying it's not the fastest. I don't remember saying specifically. But it's a very nicely growing product line, well above our overall corporate line. And there's other things like Asia-Pacific is growing very fast right now. So it depends on how you define it. We do have some newly launched product lines that are smaller in size, that are growing in percentage terms faster, but it's a very good growth business.

[Mitch Barlett:]

Right. One last question, if I can squeeze it in. You're spending $35 million more or incremental on to your marketing budget. How much of that is broadcast TV?

[Ernst Teunissen:]

It's about half.

[Operator:]

Your next question comes from the line of Mayuresh Masurekar.

[Mayuresh Masurekar:]

Could you talk a little bit more about the Staples relationship and the rollout timeline for that? What kind of economics do you expect from this relationship, and do you have it in the guidance that you have issued for the entire fiscal year?

[Robert Keane:]

Yes. So we held off on the announcement of this publicly by mutual agreement with Staples. We actually are fully rolled out into 1,600 stores. We were aware of the likelihood of doing this when we made -- 3 months ago when we made the guidance calls, so that expectation was incorporated in our guidance 3 months ago. We're very excited about it. We now have 2 premier partnerships, one with FedEx Office, one with Staples, for a total of 3,200 stores. And the rollout went very successfully, but it is fully in place. And of course, there's an in-store ramp that happens, but in terms of getting out to all the stores, we're fully there.

[Mayuresh Masurekar:]

And if I could add one more question, now that you're including India and other emerging markets, how should we think of the Staple's addressable market in Asia-Pacific?

[Robert Keane:]

I think a couple of things. One, in terms of timing, we look at a very long-term investment. I think the reality is Asia is just such an enormous market that it's certainly worth a long-term horizon in perspective in those investments. So I'll speak to your question more specifically in a moment, but I do want to say that we do not think it would give us material revenue growth in the next 1 to 4 years given that we have already this year $1 billion as an approximate midpoint of our revenue guidance. That being said, if you take markets like India and China in Southeast Asia, there are literally hundreds of millions of micro businesses out there, as well as, obviously, enormous numbers of Home & Family opportunities. Price points are much lower. Business models are quite different, and we see this as a market where we'll be testing in and learning for several years as opposed to looking to drive high revenue growth in the next 1 to 2 years.

[Operator:]

There are no further questions at this time.

[Robert Keane:]

Well, thank you to all of you for joining on the call. And before I close, as you know, we have our annual general meeting of shareholders next week. If you've not yet voted, please do remember to vote your shares. And with that, I'll close out. As mentioned in the prepared remarks, we just delivered great results that are very solid against our plan. We're confident that we're taking the right steps towards achieving our 5-year plan that we've laid out, and our focus really continues to be on capturing the large opportunity ahead of us and building a more competitively positioned business. So we look forward to talking to you soon. Thanks again for your time and for your attention this evening. Laura, that's the end of the call.

[Operator:]

Thank you, ladies and gentlemen. That concludes today's conference. Thank you for your participation. You may now disconnect.