Q3 2019 Earnings Call
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I'd now like to hand, the conference over to your Speaker today, Andrew from Senior Associate Realty income you may begin.
Thank you all for joining us today for Realty incomes third quarter 29 Teen operating results conference call.
Scuffing our results will be Sumit, Roy President and Chief Executive Officer, and Palmyra, Chief Financial Officer and Treasurer.
During this conference call, we will make certain statements that maybe considered forward looking statements under federal Securities law.
The company's actual future results may differ significantly from many of the matters discussed in any forward looking statements, we will disclose in greater detail. The factors that may cause such differences and the company's Form 10-Q .
We will be observing a two question when that during the Q and a portion of the call to eat in order to give everyone. The opportunity to participate if he would like to ask an additional question you may reenter the queue I'll now turn the call over to our CEO Sumit Roy.
Thanks, Andrew welcome everyone Im pleased to complete another solid quarter.
We remain on track for a very strong 29 team and are well positioned as we look towards 2020 with a robust investment pipeline and strong liquidity.
During the quarter, we invested approximately 412 million in high quality real estate investment spreads well above our historical average, which brings us to approximately 2 billion invested as we entered the fourth quarter.
Our investment activity during the quarter Imputed second international acquisition in the UK.
Additionally, our investments during the quarter was 51% industrial bite rent with approximately 244 million invested through three separate transactions with three new investment grade rated tenants, including I'll put us to have a distribution facility lease to a large e-commerce .
Retail.
Including the previously announced portfolio acquisition troops see I'm real estate Finance Trust, we have announced over 3 billion in acquisitions year to date.
A reminder, let's see I am transaction is expected to close in various tranches.
The acquisition of most of the properties in the portfolio expected to close in 2019.
Ending the quarter, but 236 million of cash on hand, and positioning our balance sheet favorably for the remainder of the ER and as we look towards 2020.
Our portfolio continues to be diversified by tenant industry geography, and to a certain extent property type, which contributes to the stability of our cash flow.
At quarter end properties, what needs to 274 commercial tenants in 49 different industries located in 49 States, Puerto Rico and the UK.
82.7% apart rental revenue is from our traditional retail properties.
The largest component outside of retail its industrial properties at nearly 12% of rental revenue.
Walgreens remains our largest tenant at 5.7% of rental revenue.
Convenient store remains our largest industry at 11.6% up rental revenue.
Within our overall retail portfolio.
Proximately, 95% deferred rent comes from tenants with a service nondiscretionary and or low price point component to that business.
We believe these characteristics allow our tenants to compete more effectively with e-commerce and operate in a variety of economic environment.
These factors have been particularly relevant in today's retail climate, but the vast majority of recent U.S. retailer bankruptcies have been in industries that do not possess these characteristics.
We continue to feel good about the credit quality in the portfolio with approximately half of our annualized rental revenue generated from investment grade rated tenants.
The weighted average rent coverage ratio for our retail portfolio. It's 2.8 times on a four wall basis, while the median it's 2.6 times a watch list at 1.7% a friend, it's relatively consistent with our levels of the last few years.
Occupancy based on the number of properties was 98.3% flat versus the prior quarter.
We continue to expect occupancy to be approximately 98% 29 Pete.
During the quarter, we released 29 properties recapturing, 101.5% of the expiring rent year to date, we have released 186 properties recapturing, 102.1%, what the expiring rent.
Since our listing in 1994, we have released or sold over 3100 properties with leases expiring, we capturing all the 100% a friend on those properties that would released.
Our same store rental revenue increased 1.2% during the quarter and 1.4% year to date or projected run rate for 29 team continues to be approximately 1%.
Approximately 86% upon leases have contractual rent increases.
We handed over to Paul to provide additional detail on our financial results.
Thanks, Tim it.
I will provide highlights for a few items in our financial results for the quarter, starting with the income statement.
<unk> expense as a percentage of revenue excluding reimbursement was one was 4.6% for the quarter and 4.8% year to date.
Both of which were below the comparable year ago periods.
We continue to have the lowest DNA ratio in the net lease REIT sector.
[laughter] and we expect our DNA margin to remain below 5% in 2019.
Our non reimbursable property expenses as a percentage of revenue excluding reimbursements was 1.3% for the quarter and year to date period, which is better than our full year expectation and they wanted they have to 1.75% range.
Adjusted funds from operations or AFFO or the actual cash we have available for distribution as dividends was 83 cents per share for the quarter, which represents a 2.5% increase.
Briefly turning to the balance sheet, we've continued to maintain or conservative capital structure, and we remain one of only a few rigs with at least to a ratings.
As soon as mentioned during the third quarter, we raised approximately $572 million common equity almost entirely through our ATM program.
Use of proceeds were to repay borrowings on our line of credit that's a pretty fun, an active acquisition pipeline, including of course, the large CIA and portfolio acquisition.
We finished the quarter with nothing outstanding on our 3 billion dollar line of credit and approximately $236 million of cash on hand.
We ended the quarter with a debt to EBITDA ratio of 5.0 times and a fixed charge coverage ratio of 4.7 times.
Our overall debt maturity schedule remains in excellent shape as the weighted average maturity of our bonds is 8.5 years, and we have only $1.2 million of debt coming due in the remainder of 2019.
And our maturity schedule is well laddered thereafter, with just over $300 million of debt maturing in both 2020 and 2021.
In summary, our balance sheet is in great shape, and we continue to have low leverage.
Strong coverage metrics and excellent liquidity now, let me turn the call back over to cement.
Thank you Paul.
During the third quarter 2019, we invested approximately 412 million in 51 properties located in 23 states in the United Kingdom at a weighted average initial cash cap rate of 5.7%.
And with a weighted average lease term of 15.4 years.
On a total revenue basis, approximately 56% of total acquisitions off from investment grade rated tenants.
49% of the revenues are generated from retail and 51% are generated from industrial the weighted average initial cash cap rate on industrial acquisitions during the quarter once in the low five percentrange.
While the weighted average cap rate on retail acquisitions wasn't the mid 6% range.
These assets at least 20 different tenants in 13 industries.
Some of the most significant industry is represented a general merchandise food processing and childcare.
We closed 15 discrete transactions in the third quarter, approximately 23% of the third quarter investment volume was sale leaseback transactions.
Off the 412 million invested during the quarter 384 million was invested domestically and 50 properties at a weighted average initial cash cap rate of 5.8% and with the weighted average lease term of 15.1 years.
During the quarter $27.6 million was invested internationally in one property located in the UK at a weighted average initial cash cap rate of 4.8% and with a weighted average lease term of 20.6 years.
Year to date 2019, we invested $2 billion in 241 properties located in 38 states on the United Kingdom at a weighted average initial cash cap rate of 6.2% and with a weighted average lease term of 15.5 years.
On the revenue basis, 25% of total acquisitions off from investment grade rated tenants.
90% of the revenues are generated from retail and 10% on from industrial these assets on the east to 45 different tenants in 19 industries.
Off the 60 independent transactions closed year to date six transactions were above $50 million.
Approximately 65% of our year to date investment volume was sale leaseback transactions.
Off the 2 billion invested year to date nearly 1.5 billion was invested domestically in 228 properties at a weighted average initial cash cap rate of 6.5% and with a weighted average lease term 15.7 years you have to date approximately $577 million has been invested internationally.
In 13 properties located in the UK at a weighted average initial cash cap rate of 5.2% and with a weighted average lease term of 15 years.
[noise] transaction flow remains healthy as we sourced approximately $15 billion into third quarter.
After 15 billion source during the quarter $9 billion with domestic opportunities on $6 billion weight international opportunities investment grade opportunities represented 33% or the volume source for the third quarter.
Off the opportunities source during the third quarter, 31% will portfolios and 69% or approximately 10.4 billion one off assets.
You have today 2019, we have sourced $45.4 billion in potential transaction opportunities, which marks the highest annual volume sourced in our company's history.
Off these opportunities $35.6 billion with domestic opportunities, a 9.9 billion what international opportunities.
This continues to confirm our belief that our investment international investment pipeline is truly incremental to our domestic business.
After 45.4 billion source year to date, 38%, what portfolios and 62% or approximately 28.2 billion one off assets.
Off the 412 million in total acquisitions closed into third quarter, 84% one off transactions.
As to pricing cap rates in the U.S. were essentially unchanged into third quarter.
Investment grade properties are trading from around 5% to high 6% cap rate range, a non investment grade properties that trading from high 5% to low 8% cap rate range regarding cap rates in the United Kingdom for the types of assets, we are targeting investment grade or implied investment grade properties that trading from below 4% to high 5% cap rates.
Range non investment grade properties that trading from mid 4% to low 7% cap rate range.
Our investment spreads relative to our weighted average cost of capital healthy during the quarter, averaging approximately 198 basis points for domestic investments and 188 basis points for international investments both of which were above our historical average spreads.
We defined investment spreads its initial cash yield less on nominal first year weighted average cost of capital.
Our investment pipeline remains robust and we believe we are the only publicly traded net lease company that has the size scale and cost of capital to pursue large corporate sale leaseback transactions on a negotiated basis.
We're pleased to announce a diversified portfolio acquisition from CIA and real estate Finance Trust for approximately 1.25 billion during the quarter, which further demonstrates the advantages of size and scale in the net lease industry.
We continue to expect 2019 acquisition guideline guidance of 3.25 billion to 3.5 billion.
Our disposition program remains active during the quarter, we sold 27 properties for net proceeds of $21.5 million at a net cash cap rate of 8.4% and realized an unlevered IR of 7.6%.
This brings us to 63 port properties sold year to date for 71.5 million at a net cash cap rate of 8.6% and realized an unlevered Dyer our 7.1%.
We continue to improve the quality of our portfolio through the sale of non strategic assets recycling. The sales proceeds into properties that benefit our investment parameters. We continue to expect between 75 million on $100 million dispositions in 2019.
In September we increased the dividend for the 103rd time in our company's history.
Current annualized dividend represents an approximately 3% increase over the years ago period, and equates to a payout ratio of 82.2% based at the midpoint of 2019, if AFFO guidance, we have increased our dividend every year since the company's listing in 1990 for growing the dividend at a compound average annual rate of 4.5%.
We are proud to be wonderful only five reached in the S&P high yield dividend aristocrats index to wrap it up we completed another strong quarter and are very well positioned as we look towards 2020 a portfolio continues to perform well on investment pipeline remains healthy and we all conservatively capitalized with ample liquidity.
To pursue additional growth initiatives at this time I'd like to open it up for questions operator.
As a reminder to ask a question you will need to press star one on your telephone to withdraw your question press the pound or hash key please limit yourself to two questions. If he would like to ask additional questions. You may reenter the queue. Please standby boldly compiled acuity Ross.
Your first question comes from Christy Mcelroy with Citi. Your line is open.
Hi, Thanks, guys.
Following up on your comments on the industrial acquisitions in Q3, how much of the volume.
The industrial deals with the large ecommerce retailer that you referred to and what was the difference in cap rate on that deal versus the other industrial deal.
That's represented approximately 40%.
The overall.
Investments in industrial.
And the cap rates in all three assets were fairly close to each other they were right around getting slightly north of 5%.
Is there more to do with this or other large ecommerce retailers and how do you think about that sort of investment relative to your your historically, what you've done in industrial and kind of relative to what you do in retail.
Look we've always said that there are two asset types that we are.
Very focused on retail, obviously being the bread and butter and the preponderance of what we do and that will always be the case.
But industrial continues to be an asset type that we are very attracted to their points in time, where we can make investments in very high quality tenants with growth rates embedded in these leases that are well above what we have in our overall portfolio with very long term leases and that is a very.
Three attractive proposition for us, especially when we can finance it and capture spreads right around long term opportunities, which is precisely what we were able to accomplish this particular quarter. So we were very happy with the ability to transact.
Especially on these three assets and with with some of the provisions that I've shared with you. It made it that much more attractive.
Okay, and then just lastly on the the funding for this year I am acquisition and other other sort of incremental volume in Q4.
You know, we can see where you're at at Q3 and from a funding perspective, you closed on an additional billion or you closed on that first billion traunch from C. I am after Q3 and where are you.
You know sort of in your funding you've got a cash balance and then you've got your line of credit is your intention to do another bond deal near term and any sort of incremental ATM issuance that you plan for Q4.
You know.
The beauty of our balance sheet today, Christy is that we can pretty much access a variety of capital some of which we obviously pre funded through the ATM in the third quarter, but having a leverage debt to EBITDA of 5.0 at the end of the third quarter gives us the ability.
Two certainly access the unsecured market or the equity market given we have you trade so.
I don't want to shared with you precisely what our financing plans are but but because we are.
Analyzing it looking at it on a day in day out basis, but it'll be a combination of that along with some of the dispositions on the free cash flow from operations that we are going to be generating.
Okay. Thanks, so much of the time.
Sure.
Your next question comes from Shivani suit with Deutsche Bank. Your line is open.
Good afternoon.
Just on the disposition side. It looks like you guys are cycled a fair amount of vacant boxes.
Just curious if that was driven by something specific or just trying to take advantage of varied.
Right now.
Thanks for the question should on the I'm glad you brought up this thing about vacant assets and why we you know why there was such a preponderance vacant assets sales.
It is not by design.
You know we decided on this particular quarter to have more vacant assets sales.
The advantage of being a a net lease.
Company is that we're able to look at every asset freestanding asset and make a determination as to what is the best economic outcome holding onto a vacant assets and incurring some of the carrying costs.
Is justifiable if our belief is that we can get attendance that is willing to pay rents that justify the carrying cost on the overall return profile is superior to what we are able to get when we sell a beacon to asset in the open market and if that equation sort of.
It does not yield that holding onto an asset is warranted, we go to the market and we sell it.
At a price and.
That's precisely what we did this particular quarter, but I wouldn't read you know one way or the other in terms of whether we're going to do more vacant assets sales going forward versus not this is a decision that our asset management team.
Is involved in on a day in day out basis, where they're constantly determining what is the right strategy for a given asset and it just so happens that in this particular quarter behind quite a few vacant assets sales.
Thanks for that.
Helpful.
Just wondering if you can give us an update on your thoughts on development.
The component of the overall.
Just given a.
Higher relative yield excuse me.
Should we expect to see that continue to increase.
Hey.
Lower for longer environment.
Shibani, that's a very good question once again our development.
Graham has been anywhere between call. It 30, 536 million, which it is today to as high as a 150 million.
And that continues to be an area that we are focused on.
The points that you've made.
Regarding higher yield.
You know that is part of what the asset management team to us when we get an asset back we are constantly thinking about.
One of the options that we explore is to see whether we can reposition those particular assets and in some cases. The answer is yes and that is the vast majority off of the developments that we are currently involved in.
Yes, it does.
Give us a much higher yield.
And allows us to continue to expand our tenant relationships and in fact, that's how we were able to get a starbucks as one of our tenants. So that is a program that we like it.
It's a small program today.
But.
It's one that we will continue to to build on going forward.
Thanks for the time.
Thank you.
Your next question comes from Rob Stevenson with Janney. Your line is open.
Good afternoon, guys. So they are you guys looking at any non UK European acquisitions.
These days and how is your staffing over there are going in sort of whats your sort of funnel look like outside of the U.S. These days.
So thanks for the question Rob.
Most of what we're looking at currently all in the UK, Yes, we have sourced in the sourcing number that we shared with you the six $6 billion. Some of it was in mainland Europe , but it was primarily driven by sourcing in the UK.
We are.
Continuing to focus on stabilizing and creating a flow business that we can lean on in the UK that is our priority one.
But that's not to say that for the right opportunity we wouldn't consider.
Moving to Western Europe .
But that is not the focus currently.
With regards to the team and.
You know setting up an office et cetera, we are very close to making that happen I.
I think I've mentioned this in one of my previous calls we have one of our veteran acquisition offices.
Moving to the UK.
Potentially later this month, but certainly by December .
And we are also in the mid so supplementing that team with somebody from the local markets that we're very excited about.
And that will be the seeding of that particular office going forward and I think I've mentioned this as well that some of the supports functions have been outsource and overtime, but we have built a portfolio that can justify.
Bringing in some of these outsource support functions. We will then grow the team to two to accommodate that as well.
Okay, and then Paul what's keeping you from an a rating at Fitch I mean, you've been a at Moody's for a while it even S&P upgraded you more than a year ago now what are they telling you is this sort of reason why you're still sort of it the work can be termed languishing, a triple b plus.
Hi, I'm I'm smiling a bit Rob we agree with your your analysis.
We think we're well deserving of an upgrade there.
And certainly have.
Shared with them significant data to show that you know on a comparable basis versus other a rated reads out there et cetera that our metrics.
Not only support that but also demonstrates stability through different economic cycles, you know et cetera. So we also are a bit perplexed as to where we stand.
They do their homework and give an overview, but just haven't been ready to kind of move it up to the next level.
And we think that it would be appropriate for them to continue that review and and hopefully reach that more positive conclusion soon.
What are what what upgrade their have any practical impact on on you guys or is it more if at this point just a marketing.
Positive.
Hi, our understanding is at this moment in the market no it really.
It doesn't inhibit us in any way at this point nor would it make a market difference to have that additional rating with them.
Okay. Thanks, guys.
In Q.
Your next question comes from Linda Tsai with Jefferies. Your line is open.
Hi, Thanks for taking my question.
When you look at the investment spreads for domestic and international transactions. What do you expect these ranges to largely holding the upcoming quarters I mean, I realize it has likely to deal with the mix of what you're buying but what are some inputs to consider in terms of potential movements.
Well you know there are two things that you obviously need to focus on in order to to determine what the spread is one is the cap rates and as you've pointed out and I think I've said in my prepared remarks that the cap rates for the assets, which we are interested in the UK.
Tend to be.
And on high fours to the mid five range and.
And then the question becomes okay. How do we go about financing that particular.
Acquisition, and that's where you know our cost of capital advantages really come to the floor.
Our weighted average nominal cost of capital in the UK today is right around 2.8% and so even a 4.7.
Percent is a very healthy a 190 basis points of spread and.
You know purely on the on the U.S. side on cost of capital is higher it's closer to three seven today three eight.
And but we are able to then buy assets at a higher blended cap rate and so the spreads to be quite.
Quite advantageous there as well.
So.
Once you once you sort of.
Take into account was a cap rates are in the cost of capital.
The spreads will will it just so happens that this particular quarter. It's been essentially the same I think it was 10% less spread in the UK or versus versus what we had in the U.S.
But I wouldn't say is the norm going forward there out quarters, it's quite possible that in the UK, we maybe able to do even better.
But.
If you have to think about a trend line.
I I wouldn't forecast, one geography necessarily having a superior spread to the to the other.
Thanks for that and then given youve levers to about five times in Threeq you would this be a reasonable expectation to maintain going forward.
No I think what we have publicly said and what we have shared with the rating agencies is that we won the flexibility to run our business out of five and a half times plus minus.
And that's you know that's the right ZIP code for US. The fact that it is five today is largely being driven by the over funding that we spoke about given the the pipeline that we have visibility into.
So I wouldn't I wouldn't necessarily say that five as the new norm.
I would just say that it will fluctuate, but but five and a half is bad.
You should expect us to operate the balance sheet.
Thank you.
Thank you.
Your next question comes from Todd Stender with Wells Fargo. Your line is open.
Hi, Thanks, just looking at Walgreens the stock is reacting well today just on speculation that it. It's in talks to go private and not that I'm asking you to comment on this but maybe just a couple of questions around.
Your Walgreens exposure.
Just as a reminder.
These individual leases.
The master leases.
That's part one and part too when you look at a public tenant.
Maybe in your past going private any kind of look at that risk and maybe just some context around that thanks.
Sure Todd it's a very good question.
Yes, we are seeing the rumors as wild real time off breaking news.
It is truly accurate.
And look into in the past when we have seen smaller operators go private.
No cash flowing businesses that go private.
Especially if its going private the using the private equity route that has tended to change the the leverage profile of the business. The good news here is you know you are talking about a company that is approximately $70 billion in enterprise value with a.
Equity market cap of about 55 $60 billion, if I remember correctly. So the reasons for it to go private if that is true.
Would need to be a lot more strategic and.
So we feel pretty good look we've said that the entire.
Delivery of health care is an area that is that is going through massive changes, but what we have very excited about is the fact that we own the brick and mortar and any solution and that's our thesis and I believe is that any solution, which is going to lead to more efficiency in the delivery of health care.
It's going to require.
As a brick and mortar network and so.
And I don't want to start speculating as to who the potential buyers. If there's any truth to that but I think whatever happens there's going to be some story around that as is like why is it that as a private company or as a combined company with somebody else et cetera, the value proposition is even better.
If that's not the case I.
I don't think that they would be you know that there would be rumors about it going private so we still very comfortable with regards to whether we have master leases we don't.
But I just want to remind you that.
Most of the.
Walgreens that we have in our portfolio came through sale leasebacks directly with Walgreens.
So these are institutional quality leases with growth et cetera, and I think our weighted average.
Leased or on the Walgreens is right around 10 years, so we're very comfortable regardless of which direction.
This this news ends up.
Going.
Okay. Thanks for that.
Sure.
Your next question comes from John Massocca with Ladenburg Thalmann. Your line is open.
Good afternoon.
Oh, Hi, Joe has gone so with regard to the CMS key transaction any portion of that portfolio potentially not a good long term fit within your portfolio and if so how might that impact 2020 disposition activity understanding you're probably not me 2020 guidance, but just.
Any commentary there would be helpful.
Sure.
And so.
I think when we first announced this particular transaction.
We spoke about this is a 1.25 billion dollar transaction.
We expect the vast majority of it to close.
Later this year.
And we also said that you know about $200 million off this particular portfolio our assets that we wouldn't to pursue into one off market.
And so.
But that does not necessarily mean that all of the 200 million that we have acquired all going to be disposed off day. One in some cases, the economic argument would be that we hold onto the assets collected rent for the duration of the remaining lease term and then.
Given the location given the below market rents whatever the the dynamics are that it might actually be better for us to hold onto it and tried to re tenanted or it could also imply holding onto the assets till the end of the initial lease them and then sending it so and then there's a small.
All bucket of that 200 that we are absolutely going to come out with.
In 2020 and.
When we come out with our guidance in February .
We will share that information with you.
Okay that makes sense and then.
Looking kind of at the existing debt stack you've seen some.
I've your peers kind of pre pay some higher coupon debt I mean does that make sense potentially for you guys going forward.
It very well could we did at fair amount of that refinancing activity over the past.
24 months, if you will and some of that we already kind of took care of.
But.
It's fair to say that Theres still a little bit there that we're we're taking a look at that as we get closer.
Obviously becomes cheaper to do so.
And it is something that we're taking a look at.
Okay. That's it for me thank you very much.
Again, if you would like to ask a question press star one on your telephone.
Next question comes from Collin Mings with Raymond James Your line is open.
Hey, good afternoon.
Hi, called and how are you.
Doing well done well I just wanted to pick up a bit on John's question, just as it relates to the C. I am deal and maybe more broadly your ability to execute on margin portfolio deals maybe just update us on if you believe there is a portfolio discount available in the market right now and just maybe talk a little bit more about that opportunity.
Yes look I think variance of this questions being asked in previous calls and at least over the last couple of years I would say that we believe that there has been a decided discount when be pursue portfolio transactions.
And we've seen this and the sale leaseback market we've seen this even in the UK.
When we are able to come in and right Big checks you know half a billion a billion dollars et cetera.
We do get some some form of discounts and so I do want to speak specifically to the C. I am portfolio, but.
Largely speaking you know we have seen a portfolio discounts and those portfolio discounts could range anywhere between 25 to 75 to even 100 basis points. If you compare it to the one off 10 31 market.
And that is one of the advantages of having size and scale.
And I get to that point in two to your comments that Youve highlighted and talk about this dynamic before do you feel like that gap is widening or narrowing or can you speak to that at all or does it just really very deal to deal as you look across marketplace.
I think it's the latter called and I can tell you that on every portfolio you have X basis points of discounts and that remains constant regardless of the tenant regardless of.
The market environment.
What I can tell you is we do we do see a discount.
But the amount of the discount will certainly were very and and we've seen that on multiple sale leasebacks that we've done but the same tenant in fact, when given market conditions. They are willing to accommodate us given our movements in cost of capital and then when things improve we accommodate them. So.
So.
It's not one fixed number but it is it is a discount.
Okay and then just one last one for me just more directly can you can you maybe touch on the drop quarter over quarter anyway, Okay exposure.
That probably has to do it so.
Rollovers I think we've had a couple of circle K rollovers, one of which we we got back.
And.
There was another one where we actually entered into a very long term lease and we invested capital to expand the space because they wanted to expand the convenience store.
So it's really is a function off.
Okay.
Just what is precisely happening I don't really know what the movement was but I do remember.
Seeing a couple of these in the investment committee and so in certain cases, we've invested more in another as we've got back.
Vacant assets.
Got it thank you very much.
Sure column.
This concludes the question and answer portion of Realty incomes Conference call I'll now turn the call over to Sumit Roy for closing remarks.
So thank you all for joining us today, and we're looking forward to seeing everyone at the right. Thank you.
This concludes today's conference call you may now disconnect.
Okay.