Manulife Financial (MFC) 5 Aug 212021 Q2 Earnings call transcript

Good morning, and welcome to the Manulife Financial Second Quarter 2021 Financial Results Conference Call.

Your host for today will be Mr. Hung Ko. Please go ahead, Mr. Hung.

morning. good and you, Thank Welcome to quarter discuss second call earnings financial and conference XXXX to operating our Manulife's results.

slides information We are statements and available statistical financial manulife.com. Investor website Relations earnings The call section webcast on package of the conducting this and call related virtually. for are today's at our release, MD&A,

Turning to Slide X.

We quarter by update Officer. an strategic priorities highlights Roy Chief today's our on with and overview an presentation begin and will of second President Gori, our our Executive

Chief our financial move Witherington, optimal of limit Officer, to will After Phil prepared of company's remarks, Roy's we questions. were to two ensure Financial discuss the question-and-answer participant portion adhere advance the and the to will Following live sound quality, to results. call. a operating the each recorded We remarks, which in ask

have you respond to all If we and questions, requeue, our additional will best do questions. to please

forward-looking President Before note and Officer. non-GAAP we forward-looking that to Slide on assumptions the refer in making over presentation. this turn factors and like XX With certain X Gori, materially that, the is caution Executive statements, a are Note material on or Slide for start, measures in please for use a statements I'd to financial differ actual results Roy call to and from applied Chief what our may stated. Roy? of

operating XXXX, with second start double-digit of of joining prior Yesterday, the key metrics we today. year quarter with you that announced continued us quarter. Good results the a Hung. growth for and financial for everyone compared number the year Thanks, the thank morning strong our of our across from and momentum

income our $X.X growth $X.X record XX% billion. delivered we prior from engines, WAM, reported and an X, billion, Global across Asia year net we increase with and Slide core earnings of the to of double-digit growth Turning

volume higher business favorable geographies, XX% and contributions increased sales with across New reflecting value more strong all margins.

focus our on ratio in from Global our growth expense prior to with WAM by the year, percentage continue management. business, benefited continued compared X.X margin the Our and expense points we In higher improved efficiency demonstrating scale build businesses.

EBITDA result, year. As core basis our points a the increased margin prior from XXX

NBV X.X ago in this the percentage prior growth by a and from the when XXs. year represents Asia years the tremendous margin margin Our points five lower for increased from was

these Turning on Slide I'm with our growth double-digit our most executing quarter Growth at and Investor areas industry. that in in the X our digital very in priorities, our and the continued of potential Global WAM accelerating has Asia to global businesses both our with and as June, becoming and next progress pleased in on growth the company areas. progress discussed is customer we've in focused since second phase Day strategy highest in five the other we our made centric XXXX, that earnings. delivering core outpaced

in order Our businesses XXXX industry three-year announced further our across This In complements services learning global earnings Asia. to Europe. major This track Fund marketing is core our key region-wide offer Managers a total investment European Business the our of and on-shore offering on investment markets. total and more XX% track totalled a Manulife of partnership core the funds LIMRA, Investment capabilities to market expansion and platform flows we XXXX. highest partnership launched potential accounted leading best-in-class association to that year-to-date company a for recruit Academy, trade with unified Asia, that and for of achieve of by we company target $X earnings an XX% Alternative strong we're financial and agents driving of managed private number than development in our private AUMA net for WAM's Global performance positive of agents. milestone in license our growing secured record within reflecting newly trillion,

reward help HealthyMind Vitality Manulife wellbeing. our improve the mental insurance launched customers individual we front, program their emotional insurance to behavioral the and On

is a has point it recruiting on higher well experience, in by and achieve digital million and agent it in improvement to invested to of to us target costs strategy delivering better balances $XXX is acquisition comes quarter high evidence customers we're and experience. our we've higher baseline customer track engage of lower be executing positions our of XXXX results retain the our engage capabilities second There strong an customer +XX Our NPS industry by from leading NPS to to XXXX. for outstanding MPS of +XX in enhancements, when customer, that increased we're is and our products XXXX. customers attract, as an increased leader and and number costs. ambition on and to our retention, which XX Since investment contributed digital to with of XXXX, This referrals our

In be collaboration digital our the view a insurance Asia, a customers data capabilities our During history U.S., In insurance underwriting In This business, retirement reduce our on integrating solution, and life into digital in and with with the that tools mobile solutions our by will we that of to program we active. way new to progress a entered app life we our MOVE to code aggregator collect low the additional our their we approach financial content-based intrusive second segments digital decision to plan financial dramatically their retirement with ability account, new less saving no application medical Global WAM the and signatures. accelerate for engine U.S. enroll new their app guidance continue provide quarter, or provider changes cycle to journey are launched further a sales on with rewards process. them with offers gives a enhance to and physically digital all strategies part leading code use members. The make management to iPipeline, members plan, account details, priorities. new to better the of underwriting digital engage make continue to across customers. operating our Rewardz, incentivize all

billion portfolio in it of risk. initiatives the of GMWB freed program It's The VA unlock cumulative portfolio, growth optimize deeply of our commitment improved pre-tax ratio pleased expense reduced we and XX%. made our multiple to less the Guaranteed program Turning core We've a approximately ratio the was in value. meeting by is business prime especially efforts primarily through I'm target and Manulife's that's legacy capital VA of core continue Whilst of billion in X.X second Annuity quarter, offer to embedded exceeded organic the example earnings of blocks. significant XXXX. efficiency optimize LTC opportunities a percentage see our In On driven to U.S. The a than culture, achieving goal expense capital Slide we've of to has releasing of risk freed launched legacy value towards optimization of Benefit $XXX year-over-year, growth up and benefits remains guaranteed consistently across to points progress reflecting X%. capital, capital, by in XX.X%. our U.S. we've the our outpaced efficiency XX% our by of far our of X%, our seek reflected expense quarter second $X offer since million and basis, Minimum and reduce Withdrawal to $X.X X, reduce we ratio up

LTC Investor company I'll XXXX XX% contributions our core providing of VA all and As an I with goals And progress less update to on reduce look thoughts. year-end. total at announced to to XXXX our plan the by earnings we supplemental Day, than core you from towards forward earnings of at

high will that high building priority and superior team. is final that culture team and performing exceed competitive advantage deliver believe highly consistently around performing be engaged customer a results. a I can sustainable long-term Our a expectations only

and to and we're this peers by financial ranking proud employee quartile top XXXX. compared Our target to to have is XXXX, global in achieve engagement insurance services achieved

black our We continue in more hiring against goal. in deliver of indigenous leadership doubling graduate talent XX%, And color ranks. increasing XXXX of and reached our people women than our new to of goals

share May, In role important our due to play the in farmlands. we're announced forest bespoke building our culture commitment removals XX,XXX sustainability encourage AUMA help global winning XXX,XXX we're on to recognizing all can that zero net program, well worldwide, include from owned And in recognition. goals planet. as colleagues, initiative climate and better so initiatives wellbeing global addition, global we performing teams learning continuing our annual Thank and to the a and climate their to You I'm we a Of as our operations wellbeing. operated high support on already of wellbeing, develop elevate over In net culture, our carbon agents, to our proud are path focused for focus and Day team emissions note, second zero dollars employees, in on our substantial and and Highlights our to the solutions. to to trillion a that

three substantially to greater our phase businesses. on our continue operations journey our highest against our strategic the future. priorities. services, To areas. Our reduce focuses demonstrate to on actively progress With solutions a for footprint. climate resilience. We'll key of that innovative We're sustainable change growth a mitigation invest accelerating conclude, great we'll with Through in zero potential and contribute and our our emissions to products we next develop executing focus strategy lessen net to we'll on

to our strong delivering strong I'm the optimize to continue our is as on especially goals. second of as our towards businesses, And VA, showcased That Asia businesses. strength and ever. our of XXXX the LTC commitment Our quarter WAM results in with Global legacy pleased progress and

the continue across improve to deliver many continues world's on Whilst path target. to in the capabilities digital reopening operating a invest of challenging in economies. markets our globally, and experience our largest efficiency uneven we're and We pleased customer environment to see many both to

economy Thank We who believe highlights win Witherington, about our over review the And our the to uniquely Manulife as results. of to Phil? and you. global positioned financial future to Phil optimistic of continue franchise. are is recovery will that I'll to handle positions the

Thank good morning you, and everyone. Roy,

Slide second to our for performance the quarter XX and XXXX. Turning of financial

LICAT a and billion. As market ratio in Global company WAMs Strong strategic across net resulting well billion continued an as total sentiment business. and And Roy financial with during increase did and favorable double-digit segments, of customer with of deliver us leverage XXX% flexibility growth double-digit demand combined WAM momentum quarter our business record the provide priorities. as Asia ratio Global our mentioned, insurance our to to We in of quarter. net growth have in $X.X of value in and earnings average and second core AUMA contributed $X.X income APE XX.X% in strong on the all new flows our sales

new issued our is will impact the rate not be assumptions risk-free with reductions to XXXX. during the for Standards of XXXX. XXXX, rates. reinvestment updated and will calibration of XX review a guidance in this basis quarter complete standards These while in URR change neutral. and be October include indications rate stochastic criteria yet these roughly annual And Canadian to the from of methods June Actuarial suggest third preliminary ultimate the Board and the We actuarial review to and corresponding stochastic modeling complete, XX, the risk-free points reduction updates will effective Separately a

We net by income attributed excluded of the change performance to markets. standard we our few of quarter third will drivers the the post-tax. key part be next sensitivities highlight of slides. expect items second in consistent it million in adopt estimate direct to quarter reference of and from will this shareholders our impact $XXX as with reduce disclosed to that approximately The the core impact XXXX will the of with reported earnings I

result impact reinvestment private of in direct and $XXX equity, activities fixed value delivered interest primarily of and from gains policy year in $X.X million of in quarter a investment prey related core investment we driven business a was and investment of Turning business. of reflecting higher income games the unfavorable bonds. larger insurance fee low with on experience outside older, funds. all basis. were $XXX from from income related second $XX million XXXX, by experience net the This quarter, these core sale of These Global Canada. holder favorable the in segregated of new curve and the by flattening the gains gains on in quarter offset rates. money COVID-XX favorable equity our impact compared gains WAM modestly with in in note, Asia gains across was rates was in from by prior higher the generated in seed income shareholders reported of driven quarter from by business reported rates, of up losses recognition and prior to growth experience and reflecting impact favorable Slide gain markets AUMA direct attraction million earnings mutual billion markets the on of the direct were reflecting segments, than experience gain lower net fair of a exchange items million, in The partially and second partially core earnings. of higher core the the gains impacts credit and experience. earnings earnings, market related attributed remaining risk in gains performance. $XXX the of net in on equity AFS quarter core impacted the XX% compared investments $X.X interest net offset returns in average to constant billion rate XX, expected the The the Of Net to year $XXX Inforce higher The free strong million of quarter growth was yield we quarter investment with

rate year-to-date Our market ability $X.X to effectively was to over the Vietnam, volatility time. in-force of on net on core in Hong our exchange our and shareholders year. profit shows earnings source impacts period-over-period, Insurance. transitory earnings income above Canada of basis, throughout growth manage despite income market Group Japan, Kong, the billion on a by XXXX attributed market increased billion nature XX Expected analysis. This by X% of our driven risks and Slide $X.X reflects constant of

Group well more segments favorable by across the sales, in investments surplus business driven unfavorable adverse decreased due experience quarter in by Canada lower mix the New offset of money equities. holder modestly as policy to margins, sales investments lower largely impact other net experience gains product and in with seed as yields and all insurance. retail in year primarily Insurance. partially in prior mix improved doubled policy and compared the to on Canada care neutral. net the fixed claims of with claims Hong compared higher the Favorable sale Asia favorable on segregated Kong with Long-term U.S. the quarter life offset strong and and sales AFS approximately Net partially experience funds in in nearly was funds income holder product highest earnings by on experience Core by prior games on mutual was insurance driven U.S. second growth quarter,

the COVID-XX impact investment income business on segregated on million, $XXX net of and retail favorable in and business. earnings the by delivered reflecting policy funds inflows enforced our investments, by favorable long-term Turning new primarily income U.S. driven higher money XX a lower increased gains, equities, compared business, with in and reflecting well to XX%, higher allocated policy containment earnings core mix COVID-XX a less on than by offset partially other and fixed quarter, losses and by in on income favorable new and mutual average allocated holder and driven and to gains in product sales. business AUMA claims mix interest of volumes, shows Slide Asia on Slide lower year and experience impact AFS the APE primarily XX, holder we improved fee allocated yields net prior sales growth of in on income seed impact Global and allocated volumes. corporate by driven net lower possibly capital earnings favorable primarily business partially Inforce partially higher investment of the sales, unfavorable Core WAM of on by capital, growth moderately by XX% favorable in lessening in experience offset driven new policy XX%, growth investment Core in holder on net Earnings low core. experience as investments segments. driven XX% gains of of funds, decreased higher from Core business core earnings decreased by measures offset lower by business capital. our the by sales in by from impact higher lower markets investment value by generation operating offset by of level the as capital our on income care lower COVID-XX impact a insurance Canada on

prior due margin strong products. or value an business second XXXX, Japan due NBV prior higher increased the and favorable lower U.S. by product from margins. in delivered Our favorable sales of the volumes to in actions prior the segments. of quarter across the year billion, very impact quarter, $XXX XX% product markets, year of In management increased increase sales and Kong million of APE in In higher growth second prior the insurance mix higher to a expense delivered margins. more from a Asia primarily the with favorable favorable XX%. we of Canada, XX% from new shift the NBV rates, quarter. sales the business In is by interest quarter sales from This volumes volumes doubled quarter XXXX, COLI away year and actions management year Asia, quarter XX% quarter insurance and year driven higher in driven of of prior the the level $X.X double-digit volumes, Hong NBV more sales other all increase and In

lower product by APE higher sales by benefited insurance by increased markets higher by the Kong, increased demand year by with primarily sales domestic higher market. insurance risk to of demand in partially APE and of sales which products prior segregated While bank in partially double-digit to Chinese driven sales product the and of degrees mainland the small to across agency fund across growth emerging sales APE affinity operate. continues the by Japan. and U.S. sales sales. in the XX% reflecting COVID-XX customer increased XX%, higher group from sale assurance COLI large impacts plus market and we the other as case products, non-recurrence impacts sales a sales, differentiator be on which in from Asia, mid-sized continued moderated, sales feature in Hong Hancock both all retail due a in pandemic adverse have markets XX% Canada, strong increased varying lines. XX% channels continued and In the group large offset of demand APE and lower have In Asia, insurance offset the by vitality John In feature visitors lower

billion billion Turning XX, of redemptions inflows to The increase billion $X.X will quarter. the WAMs AUMA $X geographies inflows. in markets driven U.S. average offset second from prior withdrawals, during $X driven sale by inflows The the double-digit in and billion by with In partially year year-over-year gross $X.X net inflows billion also net prior In gross were in plant sale by outflows contributions. global and year favorable in Overall compared higher prior net increased net fund impact higher all client wealth of Canada quarter, in was Global reflecting with compared benefited billion our lower management quarter the billion markets. delivered flows $X.X net new by quarter. $X.X by a retirement existing of a with with Slide inflows of to of an the compared the of XX% change and year, prior was second the member non-recurrence billion asset in and net of billion nearly $XX favorable management net business were the asset and sales Institutional driven impact $X.X and from mutual quarter, the $X.X with the $X.X growth in member outflows of outflows flows XXXX. quarter, across compared retail, of growth in billion the the prior year net

which yield XX% our basis X.X business yield fee Global benefited pleased prior of fee with in introduced XXX AUMA year growth income core core mix, points by from Day, retail disciplined basis benefits increased net WAMs net quarter strong metric. I'm highlight margin by reflecting margin net quarter. disclosures a combination of by the from XX.X in net the average expanded possibly increased expansion expense As favorable higher points to basis income Investor from increased driven contributed recent growth income, EBITDA and EBITDA earnings to operational year core points and the over growth and of management. inflows; prior scale fee These

to Slide Turning XX.

of XXXX program and of our quarter. Our second than an is mature management an by a XX% driven XX.X% the increase We earnings. compared ratio culture. was our ratio strategic XX%. core increase committed improvement efficiency in earnings, the the expense core embedded prior consistently of improvement with achieving delivered in is points expenses expense X% in year percentage X.X with a in far This remain efficiency to We including general of which pre-tax of in outpaced less goal quarter

exceed set our on As positive achieving our the general I have will rate. and denominator ratio recent expenses we sights at we mentioned beyond our efficiency endeavor Investor to our growth Day, core in that top meaning line XXXX jaws our as growth,

XX. Slide to Turning

We continue capital and to strong a sheet balance position. maintain

We movements, in have from free impact prior billion. capital redemptions from gains of market all supervisory XXX% strong. quarter of target and line by LICAT favorable of risk the the the mainly lower above impacts the of our were as is ratio with is The rates, and ratio billion capital $X.X offset $XX

second ratio financial the Gross Our capital leverage Canadian medium the our of retained from dollar. impact timing period-over-period billion. a AFS subject targets impact target, XX performance. by debt percentage partially the on XX.X% by remain decreased lower rates of at debt favorable on driven We earnings redemption due in and term value and would offset leverage of in the medium core and EPS within second XXXX, term Off XX% remains ratio target range. close dividends to efficiency delivering core expense the over payout We remain EPS and our term. growth quarter our term XX% committed medium targets met to recent Core confident the our note of ratio financial medium reflects activities. concludes the financing in instruments in ROE XXXX achieving note our but grew Operator, variation X.X quarter rate remarks. X% $X.X the we unfavorable now prior quarter the will to constant is year Slide a second On questions. to prior our of the the compared and quarter currency basis with prepared to the stronger open the impact interest core the of translation. This that call EPS XXXX points securities, XX% exchange outlines quarter quarter. to of XX% of

Thank you.

from Instructions] Partners. We take first will now Humphrey from questions Dowling the The of is lines. question telephone [Operator Lee and

Your ahead. line go is Please open.

a for and several mix is levels Good gains sales new what of year-over-year the in impact if you My taking in moving quarters. Asia business morning on business we had have I seen and that over but thank Asia coming softer related I believe an we've the the past my you elaborate new that. is pieces on showed question to for bit the the for it's in little quarters. from a to your growth, that compared seen some while questions. was can But it's outlook quarter gains coming just first the good wondering

This Thanks, for Anil. Thanks is question. Humphrey. the

as gain strong. in our you has out growth new pointed So rightly very business two of been quarter

Day distribution positioned been on the we aided strong we've to a that and the during year business upgrade that's of with account the our our – exchange well. account rate backed and of And One, up entered pleased as the as Investor our it's seen technology illustrated and well of were as basis constant XXXX, capabilities well strongly with expand as a on improve kind on growth started we quarter are sales. a to strong few performance it year-on-year digital XX% that then continue we and We new we talent. factors. upscale very continue And two well as very

last XX taking have – over a around actions as have would steps months, a expenses. you repricing number of we well have to very In have XX heard, so mix, the disciplined to addition number on that been we product as illustrated, Phil driving been our as of taken

resulted line. on sales So a volume. gain The of new you're that growth, the factors growth combination business quite new our consistent has witnessing these we is business believe, into with the

to XX business that is second Asian outlook, it So And driving ongoing also correlation, closely. I question, in with is growth will the and on XX% and to opening we in-force The highly business attention gain you effect. our months a of is in of trajectory. something environment, out witnessed the were would you point good recently draw if on of thing in only I look terms of if kind terms focus more as I were of to the also your for like that have we've door that value of new over our quarter trajectory markets. two. primarily you last if kind one EPIF caveat that sales. the that's as COVID Humphrey, quarter to book. quarters, the Southeast in it's out addition obviously, quite new seen that a outlook previous significant correlated normalize would know of exceedingly over China have a watching had the many are in resurgence that we COVID which three and of operate the seasonality And our at experience And while we to is of reckon, to the quarter to give your one, consistent you a you indication, of That

targets momentum question shared could time we Investor that to medium measures long-term on challenge from customers for short-term, containment do enforced reckon, impact had have and an to distributors a our in on Thanks confident present markets with Day. about the the again, get the time the once you Humphrey. you As that but our across recently that mobility very during remain of we the

then back we're around the That's opening because looking quarter this QX then guess several $XXX very past quarter three is four And XXX. quarter in helpful. in it's probably and new quarters, was around if of one door obviously the – I China. kind of million and strong gains of is in business

second little of it last – like, a than change? guess, I where bit half year were the that about how So seems to lighter Like that kind sales just comparable. think kind of APE your of

have a I year-on-year pointed as from level has been growth new the you perspective, as But has I our So, product will as gain, you said, I question. pretty our geographic would as I guess, in have disclosures. been reckoning as think business correlation depending you mix out, upon your – in of think geographic – I solid seen the mix variability always consistent. between from sales pretty as and business well our a some highlighted it new

said, for should do new quarter of it business I gain seasonality, indication good give our you you if As one normalize a of estimate. kind

Okay…

us but strong in in I'll add. that's you the only It also quite results share but you've will And very affecting just many affect covered in well, across it say isn't that allowed QX-QX, for think wouldn't I that and markets sales. highlighted across would the as seasonality I Anil, as the sales markets deliver you as helpful Asia, just different geography. by necessarily total And mix more to there a it gain market a I isn't just highlighted. in as really QX on does difference. bit in isn't results QX diversity again, of XXXX obviously seasonality, is our look has really off different quite makeup than radically and XXXX, with big Based results goes four the QX-QX well. frankly radically and at QX what it's to but us not of geographic continue to a you China, pronounced of saw from but the perspective, vary. a our

Thank My Global WAM. question appreciate I you. related is to that. second

pointed inflows the the retail saw is sales You talk very flows geographies Can type in then which out you net you and as growth quarter asset terms getting and low inflows? and of seeing you're strong about clauses getting stronger what of across redemption. also where of in traction kind strong geography just are

see and retail and was mentioned his in-growth of flows we Its I'll all opening a mentioned, growth primary you and the we Humphrey. in three flows question. very Phil And thanks, growth as strong regions answer Yes, here did remarks, the there. quarter quarter driver in and double-digit Yes, across had terms this Paul net flows.

U.S., franchise that the just just consecutive in underlying building to the great diversification. It's and business contributing flows of three U.S. our quarters. in net continued quality momentum here. seen that business. our it last the think positive noting the in that We've fourth also the also of quarter speaks worth out was I That's

a balance mix, of helping thing of fixed back mix to start in particularly you maybe here channel a other within if equity we your quite the sales mandate. were income. to were question balanced seeing us retail We of terms to more XXXX, The and of much selling bit on look the now, is

So overall that also yield that that's support disclosing. drive business, – profile net the the helping we're but now also and flows of

So a big other we're – just the where would fundamentals in as impact. as the as I very of business strong. strong well we're are And seeing channels they're say also retail, not pronounced

you. Thank it. Got

of MacKinnon go Tom from is question next ahead. The BMO Markets. you. Capital Thank Please

talk line much. experience gains at experience and if little very probably to want with losses be morning. higher the bit quarter. for And on what despite in policyholder we experience overall to worth the it look core a looking were the losses losses. about thanks policyholder Yes, Good basis seemed in million, we I $XX a

what So core minus losses summarize I by losses you So there? maybe little were gains or Thanks. might in experience on XX would other it experience bit more color And experience reported? to of that the that have or losses a explain you other guess be been the kind just policyholder the can geography? gains to contributed what

here Thanks, be question. Steve and that Tom. Its answer to happy I'll

in U.S. some is gains there And into items, in in results, drivers start area. think positives in any experience a Asia. loss. insurance business, there called in then And from recoveries. slightly quarter and the goes we're of variability we over the of our as of Phil else line not across but number at that that As reminder big – of through quarter. re-insurance disability what strong Those there And one in and see closed in we some some business, claims COVID gains some were experience the experience, of claims – in in of regional it those that seeing expense loss coming was piece see saw got the modest a that better we we group by concentrated is would of our unfavorable And lapse quarter. we course trends small what where was and policyholder occurred this related at then – the April, the were terms overall Canadian in geographies offsets related number in the million our neutral some had long-term costs goes Asia of primarily losses what in terms the I that our includes out, $XX a our what add Phil core well Life I bulk one color noted, then there is saw experience do overhead as

and So the of those in drivers policyholder core we're the the experience key line. are what seeing experience

– about that I what can How was – April – U.S. going you you long-term your share long-term that has any mentioned sort that's from expect progressing been and forward COVID think Maybe mention you there have would there what and in neutral Life. respect was of maybe long-term impacted impact improving has quarter? experience. that with how to COVID care and been in And care of did guess – Is what Okay. impact I you the a sort care?

to was small long-term close what saw it but neutral, positive. In in Sure. the small we positive quarter, a result, care,

of one vaccination population For with least remind for XX% XX% over program people with XX, the population and effort very has been dose. fully at vaccinated U.S. the context, successful that vaccination that in the the

care over we a We We saw our in back more claim those down vaccine deaths expectation difficult the to to And And terminations, course this it's in insureds how had claim our past trend more trend in that So of experience. claim that plays back the had saw saw because saw trend of of rate while is care. towards on see of we for translating? to provided trends. the of terms of how normal efforts, is in out the exactly that IBNR. care more the stopped, care And impact so that's a came care. we our care year, greater What and seeking predict suspending on where had well. this termination, normal quarter that we reported a more saw a more as resumption reversion towards will not levels back that and to to customers we of continue long-term that normal then normal seen we we initiation

flagged legacy U.S. update variable at Day? annuity And Okay. any that you Investor on transaction your the

Tom. robust It's is of in variable can a interests that here. buyers I the There's annuities VA. say for Hi, really with market What lots Naveed U.S. it's in

continuing and deal prospective buyers, that discussions engaging in to are and with we We continue the is possible believe XXXX.

you. thank Okay,

Doug Thank The next Please from Markets. you. is Young question Desjardins Capital from go ahead.

points, Asia. see side, some guess, I on a the see morning. On one on Hong Kong color. new value XX.X%. it's on new by flip decline X business And we did specifically just good did Anil X margins, emerging of get Hi, we And back in business to other to side, hoping points Asia.

that's the highest I recall. I can think

a is flexing I'm really What's directions? items of so in there kind sense are get two trying And different here. margins to just these some unusual

Thanks Hong the and question for with first. let Kong me start

been few business the focusing of repricing our terms on a on flagship that key in we witnessed in geographies been driving market. Kong have account that as by evident Clearly, It's scale our of multiple across for some driving well as quarters, on driver all Kong Hong and scale as well new Hong X% Hong taken being initiatives aided Kong a Kong the for Hong the One, growth we've has Hong the it. and value driven actions reasons. growth multiple but obviously we of value despite some that we of in most been the sales, saw in are was years. a So importantly It's product of Kong now mix of we business. our as now

exceedingly been about disciplined our expenses. have We

– new in have that So of into Asia I highlight of business kind the a value growth want should again, of of Hong combination value Asia that on witnessed Singapore, the and Asia again kind Other has new we Kong. the do at respect that fact exceedingly we to kind of that The that With margin resulted strong surprise to Other to given that Vietnam Asia Other. perform like constitute constitution growth not year-on-year strongly. us XX%. continues have And stood business markets China, the Indonesia,

these Other or strength witness but mix So some again market Asia impacted it diversification a value could quarter-on-quarter basis provides the change well it segment. in very Other of Asia, growth could not a as capture been segment. be new value say from business account diversity that the Other on Asia in geographic mix the exists we business many well provides are basis that given of strength of impact that in able the or – as kind has markets, combined quarter-on-quarter we opportunity the penetration some diversification from to new But mix product many our as we the only of to new of the it suffice market with in that on geographies strength positioned the believe margin. also – Asia to of well drive the largely that under The as year-on-year to to position just our margins significant

it follow-up obviously, you you a Kong sustainable a feel that's – just XX% but that – given that's is that level? And Hong seasonality there to sustainable think on the I sounds going is mean is like – be

is does been the to of as a believe, market tend has year operation. share this little our an we now for I been Hong also quarter – gaining Kong. no Hong one bit rates. And a – multiple we of as that interest scaled in sensitive flagship Kong however, have again represented and a quarters said, be Yes, Hong Kong, to And exception. fact business representation it's

mix of as NBV. have product will account combined said, I some think, So, that's something are what as But discipline. actions well to as the we of in volume take a drives higher are on we that our the what And repricing is, again, that core I expense with focused quarter-on-quarter. drivers

very Hong So us healthy margins deliver of Kong Hong Kong. scale about nature be to going at in good help And feel forward. again, we should growth able the the opportunity the

Okay. what COLI. bit Or talked Japan, think was I turnover? Or And shift business, you X% bit in agents. normal a in there more this repositioning was you're second in quarter-over-quarter that And part deliberate with just just some of COLI? a a following doing there little something about was there And a this Japan? is drop in

think in market. I changes of light some in COLI we that of Yes, in we witnessing Japan the the are have emphasizing been

well growth. on mentioned number But on grew level both positive of of as quarter-on-quarter attribution have in as in-force as of as right driving grew resulted by that in efficiency as driving as by the the well fluctuation have into on new both we focusing previous accounts I XX% from that year-on-year. much these been more on in-force, are transition We transition market adapting taken said, agent at have calls as terms some has year-on-year, initiatives Japan higher mix core is some and expense see as the emphasis a expense X% we earnings efficiency. business would, driving in well we product Our value said that on I of Japan to headcount focusing and an as in these

few increases, last of as in Asia and year seen add agents just But agency Japan, markets course just quarter across not X% highlights, but quarter. certainly not count. isn't really to on well. quarter X% be has number the significant strong, would base and would agency really in focus that have In the significant Japan a over is unlike other of very last smaller our significant in number, agent we've the of where I we huge been So, a have a pools in that on years, as our from we movement normal Anil agent

Okay, thank you.

next question Please from Financial. The Gabriel go Bank ahead. National you. Thank is Dechaine from

duration give questions. or the in And of sense books the in importantly, potential can activity selling more product two affected transaction drop legacy One, tenure you the what the variability to gains to two, know of us XX? IFRS there's thereof. a we're some I Thanks. are the schedule Merci, transitioned a to these sense be of facing of trying going going business be there, kind Asia? you're when new get amortization but

start. Naveed. is I'll Yes, This

up interest of to the on seen of and interest and investment haven't a buyers, the And we connected as up. previously pulse the finger do closely was yet. yield transactions, big terms seeing potential have rates pullback rates gone were potential In market. had bankers that We improving really really opportunities the we stay – our certainly had pricing gone

to So, we the continuing market, capital do of lot a take see a lot of deals. activity in

And it so, transact – bid-ask generates if test transact we're to and continuing we'll evaluate value. certainly a to from regularly our for potential block end, opportunity the spread every

Great.

Thank you.

question. I And can your on touch second Gabe, Steve. it's

in illustrating you emergence by we disclosures product when embedded While the will do duration, the our I'd that is we IRFS XX, amortize to is are CSM how free don't point time. And over there of one generation. surplus required the to get thing one of disclose we that product value our disclosure disclose

IFRS got disclosure. we So, longer-term, XX. indication when disclosure it and in direct but now, are We've that products shorter-term. evolves We've you meantime, got are embedded information value to think to then how that I of we'll the I EV some that products the gives the transitioned provide

Have guess. summer. Okay, we'll follow up a offline, good I

you. go Meny Scotiabank. Thank is ahead. next Please The Grauman from question from

Hi, good morning.

a in earnings help keep growth terms overall I'm to that SOE in we're that the of core the just new impact more is core kind was think XX of the new on a that I of through a it's in growth business – if IFRS into me what of driver you terms what core an And EPS. breach of could steps think perspective. in from the to some gains this quarter trying are time. question means muted business growth for that EPS to terms through How and contribution going? if world from – seeing wondering line growth big amortized that gains, Another

IFRS that for Meny. Hi, new Thanks basis. Phil. business is question. treated right differently an on are absolutely the you're gains XX And This

XX, So equivalents established IFRS new from a service in basis, you is see current margin. of to X, where contractual what sheet liability as IFRS are the the is as that will we as gains balance deferred transitioned the business

on that it's a to the metric really And because of will specific will financials be too on I interpretations I the in or terms or guidance whether the a is XX. you're of continue really IFRS our can XX well, so the of margin a IFRS And IFRS measuring growth I combination impact XX and power to say growth. our earnings evolve. that's will the metric and two, important at and CSM be the clear movement really What about or looking think underlying businesses early movements think be important that in of contractual insurance confidently service be do

important underlying assessing sort Like, at what So suggesting in both? terms growth, of kind to in – thinking to look EPS of we'll but that issue? of at you're of well. about sort core servicing able is of going terms at look the Is not have sort that the to to of earnings that a we're going being growth margin kind power, to it of be as look just

Absolutely.

at important to really CSM both IFRS XX. in think be under will I earnings and movement metrics look

a to CSM head, measure as going And you for a insurance key will think, obviously be the to amortized. future it through hit assess Meny. the companies on be good growth is I leading forward IFRS the gets of Yes, CSM which under XX. profitability indicator going nail

to all. on a at we're time think, discussing as more you growth the the is going with train as you're future. right a and spend a to topic value of looking in So, CSM that to I lot relates This driver have it key

we clarity we're to much forward are more in So that provide able looking to as quarters. coming

Roy. Thanks,

Thank of from next Please Lamar ahead. Cormark [ph] Securities. go is Prasad you. question The

improvement question Yes, management. the on is My wealth thanks. in core margin EBITDA

of it's higher, sustainability possible is margin think to the on I of the question certainly, the move rate my So, for so EBITDA core improvement. but more

the the I Thanks. margin quite margin EBITDA year. businesses core what's bit and improvement talk of but think – so think gradual, outlook the this about step when me we're for over you So of Like improvements, to these time? more I as really up it a could usually you being seeing could far little

It's four you say year, previous obviously as longer this is, a the a But new are. I we've and over the XX, half quite guidance target trying as seen quarters our Paul we've question EBITDA WAM of consecutive of pickup get mentioned, threshold to timeframe. growth now for we where Yes, about Thanks a look which Yes. have being we Lamar. we in expense was to here. last we're revenue of do we're the is above which of try growth you in What that big margin, terms surpassed to previously, business. the over pretty and term G and feeling need at comfortable highlighted would mark,

quarter-to-quarter. little to the in will need expenses invest bit will around We a business, move

to over strategic and different, the way are trajectory our the retail where tend really going straight is margins can we efficiencies be Asia to margins. see ability and feeling which I going and focused have We're deliver out you on the just and the channel, What we strength good flows of on where control. we're the particularly We're dependent long-term net with to have franchise choices higher to as is is frankly, think positive on to lot our our and to our by in and at not the of it's by ability consistently franchise, markets. a So Canada about of again, drive global franchise. look diversification, region And out. we invest it what

of under management GUM. administration That business. trillion the is One for gives for $X total our tremendous in us scale surpassed and assets milestones quarterly

to go going drive they're say on, continue margin So dependent of this We believe overall, we we be would that's investor good. margin improvement can higher we But the et drive on do can cetera. feel fundamentals levels as business, mix of business, over continue we market forward. to But long-term. preferences, to I

you're as a milestone our add just that would withstanding we've fourth to our us than that where up base markets, huge or going our straight consistently your not highlight quarter for was That greater variability this was factors are are us are, a, well global core expense see helping scale, to on advantage Paul's really as margin. and which we us leverage XX%. EBITDA coming continue done growing in to able I across certainly for was comments full, that some core multiple when EBITDA success demonstrate the an to to be defray to is that's that, to Lamar,

The as see some have couple next that frankly at of highlighted is second certainly that is we're look may that the for quite tailwind excited have Day decade. Global the next geographies is us And we fact we higher was that opportunities tremendous are key the a us, very Paul fees which we're geographies, why but certain growth about, for is not and geographies, growing forward pressures just a WAM that we other very something margins. whilst Investor opportunity we highlighted in in years, competitive margin on which to high in

expensive. my second on Great. Thank you. is question And then

more for maybe appropriate Phil. it's So

far something lower to efficiency we're target down either likely two ratio. a to see less been So – target. this one higher the has me moved suggest mix or than to in to things, your the ratio seems so XX% XXXX, What of meaningfully the, is below

talk that? likely and Thank to a two which more can what's are your mix to ratio So view higher more me is if you in going you. about of those likely, drive

talk is I We've not that set of And thanks consistently delivering that always seasonality ratio, target for for it a a ratio would that below is right. the yet at XXXX, are efficiency we're we time. some XX% efficiency Lamar, I about your we've quarters cost we an XX%. observation been What that the it's been that when looking below couple absolutely benchmark, notably is there Hey ourselves expenses with delivering highlight And for though period satisfied and of now. XX over and below question. a the consistently

number core we that a moment, So need there in of I something is favorable growing more that at has emphasize priority But is management, been to a quarters. very much ratio. strongly efficiency tailwind I expense That and very and from earnings pre-tax that's that, our the strategic observe the think the management that perspective, strategic the first want half over management. expense an to of year, for is cost

tightening. belt about not it's So

our link on and strategy to a and to other and earlier particular And with in touches we're real is and to this Paul, of strategy program mature, looking efficiency customer the our scalable there's your to elements side in see to and wealth that our on insurance we're why question digital Our link and efficiency leverage operating elements growth. program, of the between our ability grow ability you our on an deliver business the able the scale is organization the both emerge. efficient asset which because manner, management then side,

means beyond ratio. we what said to the deliver on ongoing that I our leverage in really would – the delivering operating XX% You touched on is Day to XXXX. the we And does below the efficiency positive a I in take that our things beyond pretax we to the what doors, that think Investor expenses. is of cost And growth consistently one target beyond future, earnings which growth outpace the at pre-expenses expect that core speak and XX% happens there commented ratio

you. Thank Okay.

Research. question from you. D'Souza next Thank Please Investment Nigel Veritas is ahead. from The go

we're experience. state-by-state states you less to if I life a concentrated expect morning. the follow-up And you on translate was on side, variance Delta the certain wondering could the that or geographically. refresh diverged in? having experience basis policy adverse Thank and with of COVID this how U.S. with that I holder, wanted more there Are more mixed experience states into you. do quarter, in trends us to Good seeing in on some emergence U.S. life the you're your the claim concentrated on in near-term? life U.S.

we to saw a was terms I comments our she Thanks, and like pandemic diversity It's as some Marianne last in would what if of mortality year saw we Nigel. our Steve. longevity the and of Reminder risk. of well. add can can start during

So mortality we long-term losses we saw life, our care. saw – on in in what we saw business U.S. gains

right but My predict quarter-to-quarter, – deviate I Now, trends that we the rates positive bit watch a those have the is is the – if think evolve, population mentioned come the XX of now, is sign. there. but And expectation the has mortality the down little a to diversification – substantially. earlier, can I and if received, the trends how we that we variants protection is over

see offsets. would this depending emerges, So how expect I still to

wants comment Marianne I do. don't think difficult what predict the might it's to I now just if geographic on right variants know mix. to

in Steve. to you. like Florida, concentrated so we across Thank the definitely York, in states the are miss, big U.S. more New Happy past Yes. New England entire California, and geographic From we but are states. the a

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that care for well. Okay. apply would as long-term And

So…

just that, apply care long-term that as adding was for I would well.

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more strategy contribution that reduce That VA, exist risk or are LTC vaccine an to more VA sense. in tying scenario? you explain long-term exposure? that and the instead fits it? Okay. I the skip to if or have with becomes previous LTC of elevated How comments think and a COVID-XX we exposure you do color is want on mortality how tie your just to core you longer-term COVID-XX offset about Can that could Wouldn't more substantial your variants longevity throw vaccine together be with to that endemic reducing if makes earnings of endemic strategy and together from the if resistant And pandemic. your or

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little we So on don't we be quite the believe on company mortality that that very but And the for approach diversification the the terms that side, if up desirable of got take, company. that bit has focus in less overall would with is risk prudent we think that a optimizing did to with the that. even legacy, comfortable we've mortality end a material that

I focus helped I the frankly think, of course but XXXX, us. sides not both of we answered change. a last isn't question us, of Day will would value going at of scheme just to and as the chime of that quite the aren't to And couple but correctly, growth command in businesses, just those focus diversification in and and our certainly in but things. had the greater equations significant that certainly we on quarters, has and Steve LTC impacts on saw in the we And legacy the that VA over again, Investor much continuing lot for see mentioned reducing

Appreciate Okay. you. color. Thank the

Thank Please from you. Mihelic The next Darko go ahead. question Markets. RBC of is Capital

thank Hi, to Good you. I'll adhere the two question limit. questions, I three but morning. have

What the new in interested good was The first question gains how I is do and think is? U.S. good think, biggest you an I'm business have you and what knowing sustainable easy very the your in one, new increase in gains. sales the level of very new is driver business this

of across half margin as were Thanks, demand, in as benefited business specifically customer rates new quite really lines And Certainly we certainly our and Darko imagine gains of to was for that to sales, continue a combination increased that strong. earlier, part first question. can The discipline from all of our growth efficiencies the sales. continued well set our we you of plan had Phil higher new result were strong our product business our all XXXX, be as the favorable development, It's of the a Marianne. have margins. as as in it's that with we product strong significant XXXX. our management the our products, new about talking of well but as We expense get scale, in of which also strategic pricing some back

profitability we've so overall really on working of been business. the And the

landed. have with where quite pleased we're we So

continue that's the is will Anil similar – as well, that And the terms in I highest in and But together well. vitality are see feel just with strong think the run of factors of our was go the well. high high. of the about play margins makes segment to And these about out portions And our and part are good do on also be variability business international of we we I very, a feel to to all reminder margins as a Bermuda gains. talking do think advantage that as a of as think competitive tend business that worth we also have difference. very fundamentals forward, that we the what net future We and market there U.S.

Thank Okay. you.

sort And a new a $XX but or or so give take rate we've – million? there's million think, of to variability, hit run level, just obviously further I take give to mean, emphasize, $XX you few

Yes.

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very you you for may include Thank is for that. question probably much but Marianne. Steve, also And Okay. second my

into about homes U.S. know the to paradigm you're long-term in higher reading in the possibly review. Canada, a long-term resulting Canada were significantly to respect clearly with today in care care a changes massive in costs I assumption different run we So, next large going year but

possibly for is care? the So Thank radar long-term of assumptions the but and long-term premium care – be a How this to is there then sensitive to big in screen? a of realize is, expenses rates higher there you. And that for a how would lot something expense magnitude change any that question that's to is be blocks? based quickly an and your on parts significantly kind helpful? how question, insight there's would on – interesting I can you adjust addenda

second setting? We're care? don't have in going What and in the study are be care of term include Steve. resuming customers watching may Will It's would is potential is just Marianne are we add. longer cost the in terms in be? comfortable of kind, saw to answer long-term might quarter the that at really we're trends the all the the of can – start – I trends pandemic, I Darko. Thanks, more home? care that some starting Will over time think know. care feel little to closely and closely. And wish really, right The may services a the be we from now care short to to long-term shift more that there what delivered what but implications

time use, In how premiums – increases if question been state. filings were emerged, Investor the disclosed that that to there make premium to our terms achieved giving and the has been of able customers that we a billion options. with continued $X of we, if Day that we've over against We that around lever progress trends have adjusting

defined are So rate are it they increases. has clear things for that – labor. a those very effective been file If trends, – we can clearly we

So take we once action. can would and clear there are very trends

if anything So, you to Marianne, pass you to add. have I'll

Yes.

I very you to that. covered I add well, have really anything it into think – Steve. don't think I

follow-up is so on just Now this quick that, a Steve.

results suspicion large you the decide your to you and get is and a build. may of as possibly expense ahead I curve have So brewing – do work that a in that company can outcome? go reserve Is or ask and outcome increase that of increases? rate only in you for that here is a back there then an once afterwards, premium is costs, a likely – possible clear evidence And

No. No.

me – Let me let clear. be

I adjust way. On there talking trends. clear the reserving or about negative we're by side, exposure, given long-term That's the would either were until not that reserves positive very a very,

would up there's the line would expectation going with – in the need there we we trends trends before on. a So confidence premiums. before things are reserving change in the the of assumptions. reserving my care, variety we have – in And to change confidence long-term We need – different

potential I will I that. on As have occur. not you've don't cost. I talked know mentioned, if the settled for about that higher

would expensive. positive could that be more to care, which be be less trends other home The tends

won't we major think I So need the to any reactions. and there trends watch be

you, Thank Jim. helpful. very That's Okay.

Paul CIBC. Please from The you. question go from ahead. Holden Thank next is

morning. Thank you. Good

care, that come So on there? we're we've been first any It additional to topic. through. seems rate while question waiting is in related of those updates increases there like some premium increases Are long-term for rate to

here. Naveed take Paul. that I'll question. Hi,

approval think that progress as rate we're be laid favorable continuing don't with out seeding expectations So to we expectation. also from expectations – states experience, and is rate few actually our We long-term stable recent increases. of haven't seen actually impact overall our will pace years. consistent haven't rate The LTC contractually on responsiveness and production as We make you original but based on is material detrimental any last on with permitted changed. are in as had politer to increases increases our the on line long-term

QX in get for, reserves our embedded Day, $X to Steve over we're $X billion And approval and billion we justification still Investor overall on. we assumed still reserve. and said, our outstanding, the still and and date. $X of actively program have continued embedded to On We on $X.X and what's we're approvals the that we're we pursuing, working billion and billion in $X announced billion that's of actual that that as well received tracking in to relative plans of, padded our that

So of execution. a really record track

a number. the Got because Okay. it. large I reason Obviously asked it’s Yes.

I viewing your of shareholder think Just the tried you correct shareholders. I for transact last I answer is generates day, what call, lens of, again, to for ask a value of we the release and think it but a of the for creation? value again, And of So back Naveed, terms everyone coming set to this important to second on table VA had I question conference was if part understand it's around value everyone viewing kind at be at shareholder should it out, terms so what on lens and comes creation transaction? press look can in in the VA

Yes.

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to that also with And fair then obviously value that one. maybe follow-up into Is a goes it capital, a on some therefore redeployment going free capital equation. a fair and creation assumption? potential the Is transaction that that, you're also up assume to is that that of VA

Yes. That's a assumption. fair

Thank Okay. you.

you. Mike Rizvanovic from of The Thank question ahead. Credit Suisse. Please next is go

and talked pretty Anil, just Asia Hey, sequential up back Question function and year-over-year in a to looking a had basis, that rate the go good business, for QX step XX% about once morning. you've growth XXXX. the of big at you

very year-over-year, like tough it So quarter. a you're looks coming next up comp against

in the core in movement growth at on XX% CR Because that wondering, basis hadn't in on near-term going targeted keep business just a dollars? to you what the that last look and there you of I'm it much ROE four when really that's terms is So rate. you U.S. quarters, changes I get in had even do plus the your

question. the for Thanks

we of XXX,XXX expand agents business is terms on I to a had our that lens in we in the the fact think of So diversion towards our fairing the we how now that emphasized continued through can way distribution. about are Asia. We have

well in also bank on basis. our I that partner continue across base do an to bank drive do both partnerships significant investments have customers. And of have our and productivity highlight and when investments interact has to a with comes improving have so able agency as as experience to greater expense our it we that impacts. of to of experience account exclusive made greater digital ongoing higher distributors We penetrating we us digitization. be us knock-on it on the the fact allows opportunity couple making growth the to momentum kind significant it customer and want also that XX a allows we and are One, further, but on efficiency, specifically how

of illustrated that One well. in we've as other the points that and past the Roy to alluded

all a strengths face and that to the Asia from time is does franchise then noticed our compensated that And get time, think do of have going you about of something you kind diversity key the as would tailwind kind it by of the we our if in forward. a One is other. headwind And one within amplify to of continue reported segments would market, we that kind operation. our of

markets that I short-term, our in in Asian of might environment. that's we've something resurgence of no Southeast momentum they have over But mentioned as specifically of the challenges to also COVID, the Malaysia, the Vietnam, So COVID we earlier increase like account impacting a Philippines, I significant have on last some experience in and seen Indonesia, months kind operate gained said, XX as COVID. well,

we longer as So ongoing secular our trends capturing term significant a we're the opportunity Asia, as but very positions closely, to that operate growth watching that market us about in in well given the in from feel in Asia. medium a perspective pretty drive just many geographies the of digitization, good and momentum we in, investments

so come would you most the line And expect then, Thanks that expected of Anil. profit into Okay. correct? to going growth forward,

distribution – I which to of, kind would been have would quarter will that's this well, importance be new have And that, well. correlated that the volumes, in of can specific momentum Inforce that and gained you as know alluded of on business up. as earlier as quarter But ensuring to to with as not is lined two enabled highly both, sales new combine deliver right. you is on the also the that where I see We've I going we robust business have on to you kind in I growth applying XX% two again we and say year. mentioned emphasis

to be in drivers us. emphasis pretty Your much a kind order growth are for going of is key

So as gain. API's as business across to both I guess be well it's new going

in that. which for provide of in net Thanks maybe is color just might business I'm What have gains $XXX ask strain any basis, gains, to trying best be Can others? Okay. strain you Phil. which more some be sense were get negative strain. wanted then And positive I would a gross a would products what quick number. sell the and the that you new the you to new one one, on how of actual any about just be course reduced Do on broadly? that by there a for million negative and business number? much mix

Phil. Mike, the is question. Thanks, for This

Steve, net million specifics how whether have certain a new that make games include of that. products does any know $XXX strain. don't there. embedded that comments is So me strain I in is of number that much the don't I generate additional within business have you front to

improve you cetera. on constantly don't on but can et as profitability, Thanks, on me, numbers a I drag given focus We're it's how focused in Phil. earnings, through. do have of we can you and front – imagine, see the – at a strain where we we that looking we coming

expansion have So certain drive where to do margin improvement. management it we at

$XXX to that fair it number be portion number, a to a it's get million? would is So straining the small assume that to small net

Mike, certainly smaller it's than…

Steve. Sorry, Go ahead.

gross than Smaller I but don't than said, we like don't I certainly gross – that the handy I you, want but have number, follow I up number, the could think with that's… – smaller but bleak, I

we Thanks maybe it. for can much very color. And the follow-up. Yes. Appreciate

Thanks, Mike.

I There like would turn to you. further registered not this no at are questions meeting are Mr. that Thank over time. to the Ko.

Thank you, operator.

are available the nice be call everyone. morning, will after We a any Have questions? there if follow-up

participation. conference now time, this at disconnect you Thank for we you. and your ended. Please lines your thank has The