Alex Hughes: This is Alex Hughes on for Trevor. Thanks for the questions two, if I can. First question is on the cash flow commentary. Do you expect free cash flow to return positive in 2Q as you implement the Phase 2 cost savings, and while full year free cash flow be positive? Or was that one of the bigger drivers for withdrawing guidance? And then second, can you touched on it before, but can you kind of dig deeper into the trends you saw in January, February, and if you’re seeing similar trends through March? Thanks.
Damien Schmitz: Sure. This is Damian here. I’ll take the first question on the cash flow generation going forward, and Kedar can take the question on business performance trends. So I think, you’re getting the nail in the head right there upon completion of Phase 2 actions, what you heard today, the majority of them are going to be completed by the end of the second quarter. We’re going to be generating cash flow and adjusted EBITDA a meaningfully way for the balance of the year. And so, while we we’re going to see cash file flow in this first quarter, and that’s part of a normal seasonal sequential pattern of this business as well as reflective of the business pullback. Cost actions that we’re taking are going to improve and stabilize our financial profile, and our ability to generate cash flow on an organic basis going forward for the rest of the year, we’re not really giving any guidance on cash flow position for the full year.
And that’s the way to think about our cash flow generation is, primarily our adjusted EBITDA profile to our CapEx, which we have also meaningfully lowered by taking much lower cost in our tech organization, and moving from our on-premise data centers to the cloud, and finally, our net working capital, which is going to be reflective of mostly of our local billings volumes. And Kedar for the business trends.
Kedar Deshpande: Yes, on the business trends, what we have seen in January and February is pullback, but at the core of it, it’s a mix environment for us. So for example, there are some particular verticals, which are coming back at similar levels of last year, but at the same time, there are some verticals, which are not as effective. Combined that with — there are some hiccups in particularly first two months around with our cloud transformation, we had some incidences. So, I would say, overall, what we have seen in first two months, I don’t think it’s a sub-reflection we will have in March. But given our business complexity, so for example, I can tell you in our verticals, within local as well, it’s not one that fits all.
So for example, things to do, it’s coming back really strong for. But our health business beauty is also at par level or sometimes below level and this trend goes up and down in some particular cases. That said, March performance for the ones which we are focused on, which is basically the factor we have mentioned in our sales strategy to bring on new merchants, that’s the exact point where we are trying to see that do we get actually the response when you bring on the merchant and is that a better response. And so far what we have seen is much, much better in terms of when we are very focused on bringing the targeted merchants as well as trying to reduce the retention — sorry, attrition of our merchants. And going just to complete that particular statement, our criteria is very simple, if you can sell 10 or more watches per month, that’s kind of merchant we want to have, at least if we are using our sales force.
And what we have seen is that, that particular factor compared to our, what we closed the merchants last year has grown dramatically up.
Operator: Thank you. And ladies and gentlemen, it appears we have no further questions this afternoon. So, we would like to thank you all for joining Groupon’s fourth quarter 2022 financial results conference call. We’d like to wish you all so much a great evening. Goodbye.
