Q4 2019 Earnings Call
Greetings and welcome to the Gulf feel Corp. fourth quarter in full year 2019 financial results Conference call.
This time, all participants really listen only mode of question answer session will follow the formal presentation.
If anyone should require operator assistance during the conference. Please press Star Zero Wonder telephone keypad. As a reminder, this conference is being recorded if so my pleasure introduce your host Kristine walls. Please go ahead.
Thank you and good morning, everyone I'd like to welcome you to the goal feel Corporation conference call discuss the company's fourth quarter and full year results for 2019, which are reported yesterday.
Joining us on today's call, our President and Chief Executive Officer, Johnson, Chile, and Chief Financial Officer, Steve worry.
If you did not receive yesterday's press release. Please contact me every one to 898 307, too and I will send you a copy or go to Goldfields website, where a copy is available under the Investor Relations tab.
A replay of today's webcast will be available in the company's website under the Investor Relations cats.
Before I begin I want to remind you. This discussion may contain forward looking statements, but then the meeting of the Safe Harbor provision the private Securities Litigation Reform Act of 1995.
You can identify these statements by four looking words, such as May well expect anticipate believe estimate plan and continue or similar words.
Any forward looking statements are based upon goldfields managements current expectations about future events and goldfield assumes no obligation to update any such forward looking statements, except as required by law.
These forward looking statements involve risks and uncertainties the could cause actual results to differ materially from the forward looking statements.
Accordingly. These forward looking statements are no guarantee of future performance.
These risks and uncertainties are discussing the companies and a report on form 10-K for the year ended December 31st 2019.
Also certain non-GAAP financial information will be discussed on the call today.
A reconciliation of this non-GAAP information to the all its comparable GAAP measure is set forth in yesterday's press release, which can be found on the investor section the company's website.
With that said, let me turn the call over to John subtly.
Thank you Christine and good morning.
We appreciate you joining us and for your continued interest in the Goldfield Corporation.
After my initial remarks, I will turn the discussion over to our CFO, Steve Weary, who will update you on the financial performance for the fourth quarter of 2019.
As we announced yesterday, our 2019 year end results included record high electrical construction revenue.
As well as improvements and net income earnings per share and EBITDA compared to 2019.
Also our electrical construction backlog at December 31st 2019, which 276 million.
Up 29% from December 31st 2018.
Additionally, as of January 31st 2020, our backlog was approximately 502 million as a result of newly executed M.S. age in January of this year.
Each of our regions experienced strong revenue growth in 2019.
This growth was due to a combination of securing new customers increased demand from existing customers and service line expansion.
I would also like to share with you several significant achievements, we anticipate will have a positive effect on our electrical construction business and twentytwenty.
These include.
Service line expansion in sub station and distribution services with both new.
And existing customers.
Increased presence in Kentucky accomplished by a securing additional m. assays during 2019 and 2020.
We're also expanding our geographic footprint into stage adjacent to Texas, including Oklahoma, Arkansas and Louisiana.
Execution of a new and renewal of existing M. essays in our service line territory.
Looking forward goldfield us well position to build upon a recent successes and to continue growing revenue and expanding our customer base.
At this point I'd like to turn the call over to Steve wearing our CFO to provide a review of our financials Steve.
Thank you John and good morning, everyone on today's call I will be reviewing our 2019 fourth quarter result, as compared to the same period last year.
[noise] record fourth quarter 2019, consolidated revenue was $44.1 million, an increase of $7.4 billion compared to the same period last year driven by improved electrical construction operations.
Electrical construction revenue into 2019 fourth quarter was $44 million, an increase of $7.3 million or 20% from $36.7 million in 2018.
Year over year fourth quarter revenue grew primarily due to increased revenue in both the Texas southwest and southeast regions.
In these regions, we experienced continued growth in both MSC and non M.S.A. customer project activity as well as service line expansion.
These improvements were partially offset by decrease installment.
Fourth quarter 2019 gross margin on electrical construction operations increased to 22.2 per cent compared to 13.4% for the 2018 quarter.
The increase was primarily attributable to favorable closeouts, a certain projects in Texas.
Factors contributing to this improvement included the acceleration and improvement in project schedules.
Our foundation operations also experienced margin improvement as a result of higher volume.
Comparing the 2019 fourth quarter, 2018, depreciation and amortization expenses increased approximately $392000 or 16.3%.
The $2.8 million.
This increase was mainly due to higher capital expenditures to support revenue growth in electrical construction operations.
Selling general and administrative expenses rose $755000 or 45.4% to $2.4 million in the fourth quarter compared to the same period a year ago.
This increase in S. DNA was primarily due to higher accrued executive bonuses as result of a partial bonus waiver and executive compensation for 2018, which was not waived in 2019.
Fourth quarter operating income was $4.6 million in 2019 compared to $853000 in 2018.
This improvement was primarily attributable to higher electrical construction gross profit.
Net income increased to $3 million or 12 cents per share for the 2019 fourth quarter from $664000 or three cents per share in 2018.
EBITDA for the fourth quarter ended December 31, 2019 was $7.4 million compared to $3.3 million for the same period in 2018.
Total backlog at December 31, 2019 increased $61.9 million or 28.9% to $276 million compared to $214.5 million as of December 31 2000.
18.
At the end of the fourth quarter, our 12 month total electrical construction backlog increased 39.5% to $142.1 billion compared to honored and $1.8 million one year ago.
This was mainly due to increases in EMEA say backlog.
As of December 31, 2019 estimated m. essays accounted for approximately 72% of total backlog versus 79% at December 31008 team.
Subsequent to December 31, 2019, we were awarded multiple new M.S. age with existing customers amounting to approximately $242 million in additional backlog.
These awards increased our estimated total backlog to a record $502 million as of January 31, 2020.
Approximately $31.5 million or the backlog awarded subsequent to December 31, 2019 is estimated to be completed in 2020.
At December 31, 2019, we had $23.3 million of cash and cash equivalents.
$32.2 million a funded debt.
$36.7 million of working capital and they 23 million dollar revolving line of credit of which $22.4 million wasn't available for borrowing.
This concludes our prepared remarks.
Operator, please open the call two questions.
Thank you know became ducking your question answer session.
If you like replacing the question. Please press star one under telephone keypad.
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One moment, please what we pull for questions.
First question today is coming from Sam Rebotsky from SCR asset management. Your line is now alive.
Yes, good morning, drawing Sam.
This one is the that this is the best quarter year and.
Ever and if the stock market was <unk> was different you would be the market would be more responsive.
No no when we look at the Texas in town South.
South, whereas the fourth quarter showed 16 million eight versus 13 million, presumably that this was a profitable quarter in this area.
Where before we're losing money.
Okay, that's correct down.
Yeah now the backlog the 240 million isn't that what period of time is that took place in 2000.
20 is that it and they say over seven years or is that what is the timeframe of that to 40 million.
I think there it's a three and five but I'm I'm I think the three and five Sam.
One of them.
Between three and five yeah that is Craig okay. Okay, that's wonderful ER and and it's only yes, we're very happy about that.
And and presumably any contracts that are in Texas now significantly more profitable than they were before.
Well what happens in Texas Sam is.
As you know we have changed our methodology of how we pursue bidding.
And and and some of the components that affects the bidding process have been modified to accommodate or manage quoted the whether or not.
During the bidding process rather than one on one more on the ground.
Having said that the additional customers generated by.
The new contract or one of the new contracts.
Oh, I shouldn't give us a greater source to draw from.
For the Texas Southwest region that that that's a very positive event.
Because the more customers we have to draw from.
The greater the opportunity we have for success.
Oh, okay.
Now as far as the or do we have enough employees to handle the job that we have [laughter].
The answer is presently yes.
And it varies from time to time, Sam depending upon other work that they then other contractors have but at present lay the answer is yes.
And now that we earned 12 friends in the fourth quarter I I would appear that the profitability going forward should be significantly greater because we had significant losses.
The you know or reduction in profitability earlier in the year.
Are you talking about Texas are you talking about Corporately corporate wide or morning, I I'm just didn't just in general having achieved 12 cents I I would think that the profitability for the full goldfield going forward <unk>. If you are allocated say.
50 cents.
We would do much better even then that going forward.
Okay.
What what.
What I want to share with you as I have in the past is they the short answer is yes.
I'd be very careful and watching this company quarter over quarter, because there are substantial variations or fluctuations between the quarters, depending upon our job mix. So seasonal. Please look at this company on an annual basis and don't good.
Meijer and up in an individual quarter, then maybe an anomaly high or an anomaly lot.
I'm not saying the 12 cents is too high.
Or something else might be too low what I'm, saying is it will vary from quarter to quarter I encourage you to look at this company over an extended period.
We now.
Yeah, let me expand on that so looking forward.
We have entered into several new M. essays.
That are going to have startup cost associated with them.
They will impact Q1 in addition to that the.
Need these projects are.
Our.
<unk> revenue and profit from these project are really are expected to come online.
Commencing in Q2 so.
In there isn't there were delays in receiving these contracts we had been expecting them for quite some time.
And the utilities, just as as things will be.
Did not get the agreements to us such a we could get started a couple of months ago think about it we started a job.
It can take 'em several months to get it's really up to speed.
Oh I'm very excited about where you could go because this backlog.
Even take into consideration there may be some costs that go in the beginning of the year and I think.
This point in time I would hope you would intend to tell the story more unlike other people know about this he didnt secret of Goldfield Good luck John.
And.
I appreciate very much.
[noise]. Thank you My next question trains coming from George Gasper, a private Investor. Your line is now live.
Yes, and you hear me.
Yes. Good morning, George how are you okay. Okay. Good morning, Funny I first question that <unk> relative to.
The financial statement I noticed that.
Before I Decemberthirty, one 2019 versus 2018, there other accrued liabilities show adds 5.047 million versus 213900.
$900 that can you explain what that is please.
I'll, let Steve taken that one but this is it these are lease liability.
I'll, let Steve get it in the and then that came by the company uses a number of different methodologies.
Just secure equipment to build projects.
And you know, including straight purchases rentals are peos.
And Ah Master lease agreements under the mass reach a lease agreements or is it changed in the accounting regulations that impact the balance sheet, where there is both on asset.
And liability associated.
With these leases these master leases that vary in time between 60 months and 84 months, but ER and I think Steve can give you the corresponding entries.
Dealing with the lease liabilities, Steve Yes, yes, John Thank you.
George at December in 2019, when they set up the new accounting standard you had to start setting up some assets and corresponding liabilities, which basically offset each other.
On your balance sheet, so we had about $6.8 million of.
Operating lease right abuse assets at 12 31 19.
And then we had.
$6.8 million, a similar number in lease liabilities, which the $5 million you referring to is in the non current.
I see.
I see that makes sense.
Yes, it was kind of new accounting or new accounting standards, you just have to account for.
Both the use the asset usually the equipment and the relative liability associated with making the lease payments.
Okay. Thank you on that now next question as it relates to.
You're improving revenue range and and your Ass field operations can you explain a little bit more or is there anything new that you're doing in terms of your overall complexity of what's javon, how your Japanese generating your your revenues maybe.
Take a between the south eastern probably the United States in the Texas area are you able to grow.
The opportunity level that you're you're doing could you explain that.
Let's look at it globally first of all [noise].
As as I've shared with you we have additional.
And I say contracts are I must say contracts our contracts brew.
At December 31st and then subsequent.
To that date, we have additional M.S. age that we have signed so having said that.
I would say new customers, we have several new customers.
That are going that then have impacted and will in the future continue to impact.
Our revenue and profitability in addition to that.
We have made <unk> substantial expansion into Kentucky, and I think you'll see that is a.
ER as a larger source of revenue moving forward the number of crews there have expanded and will be a.
We continue to expand during twentytwenty and into the future.
Additionally.
The the.
Our geographic footprint.
Is continuing to improve and as I said in the beginning of my prepared remarks that.
Because of the location of some of our customers, we are able to step out into.
Into two Arkansas, Oklahoma.
Oh man and and and other adjoining stage to Texas during 20.
19, I believe that we added.
19, or 20, new customers that we had non done business with certainly within the last year. So as we continue to and.
To our customer base, our geographic footprint.
We feel that we should be able to continue to expand our business. Additionally.
[noise] I'd like to point out that we are.
Ah we we are expanding a thing where you are expanding our.
Service lines to include not that they haven't in the past, but to expand our substation construction our foundation construction.
And our distribution involvement historically, we've not done much distribution.
We expect during 2020 to start working more in that area to expand our distribution presence throughout all of our regional offices.
Yes that well that's it thank you for that explanation and that's a very powerful commentary on your part it does express and the gigantic opportunity that you have as you move here and customer base forward in some of the new.
New geographical areas that you're moving into there's there's a lot of growth in those areas and that should be very beneficial tea.
Our our I will let Scott and our franchise area.
Particularly between Virginia, and running down to Florida, and then across.
To West, Texas, I think is as good as it gets in the in in the country and as we fill in those areas in Louisiana and and Alabama.
This will.
Further.
Enhance our ability to support new customers and many of them can be supported out of our current offices, but we're hopeful that as we secure these new customers. We will we will we will opening new offices to accommodate a missing.
Spansion <unk> in in this under a long long this.
Southern south central and and and.
Out west and Central States South Central States.
Yes.
Okay, and then one last.
Question on the five GE are you doing anything on Fiveg and style at this point time I know I asked the question pretty much more but I just I I know you do we see we as you know we do a fiber optic work.
And it is a small portion.
Of our business, it's a very profitable portion of our business, but it remains a I'm a very small portion and our involvement in fiveg only is associated as new.
No fiber optic lines are splicing is needed by our customers are again I reiterate what you do a small amount of business in that arena.
Right well. Thank you good luck tier. Thank you, yes, Sir thank you so much like our next question today is coming from Everett comedy from private Investor. Your line is now live.
Good morning, good morning that Sharma.
Hi, everyone.
Very well.
Yeah, very good not a numbers guy and I'm, just a average investor, but I've been watching gold fields for 53 years 1967, the stock was $13.25 or share and.
Your head I remembered well by the way just so you will not yet and Uh huh.
Yeah, one I know you might want to 13 57 by the way [laughter], but if you remember.
I had 125000 shares a gold fields and because of a bankruptcy and 1998 I had to sell at all but I'm back again, and I wish you well I'm glad to hear though I'm hanging in there and we'll do our best to make sure that yeah. Youre decision is a wise one.
Well it was actually a ticker tape.
It was a ticker tape that you know it wasnt electronics or anything it was actually it ticker tape machine and there was an l. gentlemen, there and he actually got me interested in Goldfield AD spend 50 cents 53 years. So I won't held you up anymore, you take care and have a great day.
Thank you for your calls her.
Thank you. My next question today is coming from Stephen brand Center from L. investment Your line is not alive.
Oh, great job and Morningstar.
Good morning, Thank you.
The gross margins were exceptionally high this quarter and it was pretty well explained but going forward do you see us getting into high teens or maybe around 20% gross margins going forward.
I I think our goal is to try and get it between 16 and 19.
And as I shared with you before there will be variations and sometimes wide variations quarter to quarter and and gross margins.
Hi, I'm.
Hi.
We encourage you to look at goldfield over an extended period of time because of the way some of the jobs fall and and the start up on some of the the the projects can be delayed and it's not always the.
The <unk>.
The fault of the company or the fall to the utility themselves. Many times there at the mercy of.
The the NERC FERC and other governmental agencies <unk> that.
I'll give that a grant the outages.
For the construction and in Texas.
Are caught forgot controls the.
The the outages and during the summer months. It is almost impossible to get an outage and you need to be working either doing hot work.
It is working energize lines and I didn't mention it earlier, but we are making a very strong push to expand our expertise.
Within the hard work area in all regions, we do art work, we've done it for some time, but as these constraints continue to tighten on the utility.
And their ability to to grant these oh.
Opportunities for us to work on they can't de energized the lines for us to work we have to have the ability.
To work on energize lines, and Additionally, and that night, we you know it's not not our it's not my much fun, but we do we do on occasion, we have to be in a position to work at night.
For him OTN traffic considerations. There there are great. Many components that often we don't think about.
A one when when we discuss powerline building, but.
That since many of the right of ways or adjacent to major highways or it can get very complicated into construction process.
Okay, very good and the new I must say worked at 240.
Million dollars that it added to the backlog or the gross margins in that 16% to 19% range.
We are hopeful, but they will be in the 16% to 19% range yes.
It will vary from job the job.
I shared a few minutes ago. We you know we leased as the projects God that we signed up during 2020 or.
I don't know one I may have been signed in late 19, a there are startup cost associated with them that I could get granular on but are there are there are startup costs that that hit.
These these projects in the initial stages of starting up a and the issuance of work.
Has taken longer than we had anticipated because.
Some of these contracts were actually signed in February I think and so that's delayed our.
Our ability to keep the rhythm moving in a very smooth patter, having said that.
We feel strongly.
But this is a temporary situation.
And then moving forward throughout the year, we should be able to continue to capitalize on the successes, we achieved last year and we are hopeful that the additional customers will bring us both increased revenue and profit in 2020.
Very good very good the tax rate you guys last for a while it's been around 32% corporate tax rates 21, the Florida corporate tax rate is I think it's 5.5%, what's causing your rate to be kind of higher than general.
Population of there there are three or four different things one of them is the non deductibility of certain expenses.
Well one of them happens to be in and the way we pay.
The which is it seems the the the per diem, we pay per diem to the men and a per a portion of that.
Simply isn't to deductible.
Part of it related to a two to a part of it relates to meals and then you've got the 50% reduction on the a portion it's not deductible for federal purposes for meals.
Entertainment. So that's that's been a large number per diem per diem has been a big.
Big cost expense for us big expense for the company in life, and we do not expect that to get better.
R&D as the cost of housing.
These personnel line personnel increases the per diem rates certainly over the last four or five years have increased dramatically.
Although hopefully it is.
Going to the rate will slow it is going to be and larger component.
And the transmission business we work.
Overbroad areas.
Some of our regions they.
We will you have to be more than a certain number of miles from your house.
Federal or is that internal lore I can't remember.
Federal doesn't drawl, okay. They don't draw the line I don't draw a bright line you have to set of state you have to set an estimate so reasonable range that someone would be expected.
Return home or stay out of town.
But those the the per diem as one of the principal contributors. There are other things. It's also a principal contributor to a obtaining employees yes.
Well I mean, it depends on what part of the country you're going to.
There there are certain areas that it is.
Very challenging.
Finding qualified health.
Rather than get into getting where they're at it that I assure you. We all know where it is and they can be.
We have to space pay special.
Oh, hi per diem rates in the other thing or they moved think about this if you have.
A catastrophic event happening in the Bahamas.
The draws personnel.
And very high rates.
To the Bahamas to work on them, there goes bad workforce and they're paying far more than we can afford to because they are paying much much more.
In two to the men then then we could under our existing contracts.
Additionally.
PG any.
Hey, much higher rates than we did.
Oh, and and the dynamics are the fluid fluidity.
Oh, the Oh, the workforce permit the man.
Women to go to where ever the work is so we have little control.
Over over these people, it's a it and we because there is a an extreme shortage.
Personnel.
That we are.
We have to take these people back and I understand what they're doing sometimes the per diem might be.
More than $200, a day or might be $300 today.
In in California.
But Fiji and he has been a pain from our perspective the.
Rebuilding of ER.
Areas in the Bahamas in Puerto Rico has also been extremely challenging.
And we've we've about worked our way through that but.
Those remain issues and are going to continue to do that in the future.
Okay.
Are there any large contracts that you're bidding on like you were last quarter that possibly could be signed in the near future.
Well the answer the short end or that is yes.
We are.
Generally working on substantial contracts.
All the time and yes, there are contracts.
Oh, we're working on as we speak.
That would reach the threshold.
Although public announcement should we be successful.
Very good one last we don't like to go overboard announcing every contract we get but when they when when they hit the one we did that for CMC when those projects over two projects and aggregated about $50 million, we felt it compelling that we.
Inform the shareholders because that was so significant.
That that was.
Imperative that we put out a press release.
I'm happy to hit 40 million to get a release, but it certainly has to be well up there in order to to generate a public.
Dissemination.
A lot a in there the reason being is that we don't want.
Information available to the street, because a guy is supplying certain products to us and he knows how big that job as that is not available to you as a shareholder.
Right.
With the stock market trading the way it is in the Corona virus have you had any issues dealing with.
Maybe a contract so your employees or.
Customers no.
No the company has developed.
Plans for the Corona virus, we're in the process of implementing them.
Most of the.
Provisions of relating to the Corona virus.
Our obvious and are similar to what other.
What are what other companies are doing we feel that.
Since we work in small groups accrue may be.
Somewhere between let's say six and 20 people depending upon what they're doing.
And that they are widely dispersed and are in non.
Concentrated urban areas.
That we may have a lower likelihood.
Robin countering the virus now I can say that and tomorrow morning, wake up within employee.
That that they've been may come down with the virus it.
I I, we are hopeful that as the summer comes on the he begins to rise.
That the the viruses will become less of an issue and as.
Vaccines are developed.
Hopefully later this year.
This issue will be put to bed.
Hi, it's not a thanos azure.
Great. One last thing you had the share buyback. It doesn't look like you bought any recently have you ever considered doing like a Dutch tender offer where you say by four or $5 million four or 5 million shares assays to 50 a sharon.
Does that might be some funds that need to get.
Some liquidity.
And this would be a great opportunity to take advantage of you have a large cash position you have big accounts receivable.
For $10 million, you're probably by about four or maybe even 5 million shares.
Is there any thought of doing it.
Such tender or are you going to consider buying back shares here, Chris as well I mean in their their rules are actually very strict.
On the on the buybacks and.
And how they work, but the and the answer is yes. It is actively under consideration.
And it is a where do we feel that the best sourcing use of funds of the company is is it in the share buyback or is it in capital expenditures.
Or the reduction of existing debt it could be a number of areas that the board considers.
As they move through the process so.
These.
There there are constrained so it's not as easy is.
You don't goods run out there and do that it's not that easy because it.
It's been challenging for us in the past to do come up with large amounts of shares.
Uh huh.
I've from from the from the from the market.
But the short answer is absolutely.
I believe it to be a good source and other companies funds.
Yes, it yeah, I think it would be there's I think it's an FCC form that's called S.C.T. O Dash I backslash okay.
MGM resorts as filed one where they issued it and it got filled.
The market activity. So I didn't know us sometimes you have a couple in body market. You are now that they did a $5 below market and the and the and it came down a met them I guess the market kept going down, but we don't know where the market is going to go your stock's trading around $3 a little over three what it can go to send it to on a quarter and if.
If you offered it might be some funds that need liquidity in.
Ill.
It would be so certainly on the value that definitely be accretive.
I couldn't agree we the more I will look into that.
I I wanted to be honest with you I have not spent a lot of time looking at acquisitions below market I'll speak to council about it.
Very good. Thank you haven't been have Src on the next call and very good I'll see other shareholder meeting.
Yes, Sir Thank you. Thank your next question today is coming from Michael Eisner Private Investor Your line is not alive.
Great job. My question was about Corona Vivus up, but I think you just answered it but good I hope 2020 looks great going ahead, especially with the contract in January.
Yes, and you'll see that develop as the year moves on.
I'm now.
As we move from quarter to quarter, and we develop these new contracts and they come online I think gives me please with the ultimate results.
Is it I'm not just made me think if something is it a big expense to bring them online to gear up.
If you can be.
It can be a indeed it.
Hey, let me let me give you a for instance, when you bring on a distribution curve you have to.
And the tools don't meet the threshold.
Oh capitalization.
And let's say it cost 40 or $50000 to tool up a new crew.
That does that money gets deducted.
At that point immediately.
So you can take a hit for $50000 before you turn to skirt.
And that could be a big expense that hopefully we will discuss at the time if it becomes a significant number if you if you build it slowly.
You know it.
The amount of money that could the good hit the income statement wont be large enough to.
Get your attention, but should we you know and then wouldn't take but a 15 crews there really.
Put a put a stake in your eye in terms of how much it may hit the income statement.
And again I think type of work issued and you have to have some threshold.
In order to two to four capitalization of equipment.
It's tricky accounting wise.
I think this goes back to why you said before don't look at the three months result look at the Big picture for the year.
Yes, Sir.
You just tell us either with a hit much Uh huh.
Watch 20, its back in house for next quarter that you get hit subside.
Contracts to go forward and you get it would one one big Bill at the end of 200, the week like as we get caught on you really can't.
Judge what's going to happen.
You are spot on.
I mean that keep that scan doesn't has happened.
Thank you I appreciate thank you very much Sir yes, Sir.
Thank you. My next question today is coming from Kurt comedies from call him hang your line is allies.
Hi, guys, a I've been following the company for quite a while not as long as the one guy for 50, some years, but certainly the last nine months is.
Where we were nine months ago. This is this is something that probably I have not seen its.
Big credit to you guys worry or how the new customer count the outlook.
Compared to what it was last summer is really.
Pretty incredible so congratulations on that that that's pretty impressive.
Oh screening the bonus accrual does that take place throughout the year or is that a Q1 event.
It takes place throughout the year.
Okay. So that is something how they do every the bonus you saw it is where the bonus numbers in there.
We've made some changes.
And and I don't know isn't in the public documents of religious is effects yesterday, you were read my bonuses read missed worries phone is they have been modified.
We we.
We we felt that we have historically felt that sense.
And I, we have discussed this with the compensation committee that the company does not to grant options.
To its employees or shareholders I'm in or or executives that we have paid cash and then.
Oh I at least I personally I've gone out and bought shares and they open market you can see those in my filings and but it did it makes a very large.
What appears to be a very large individual bonus.
That may have accrued anyway had we paid a smaller.
Salary and then paid a ah.
Paid it in grants and or or or option. So I'm not going to for clued into future that the comp Committee may not consider that I just wanted to share with you that.
That's one reason why the compensation from a cash perspective may be.
May appear to be large and when in fact, if you look at competitors, you'll see that they are all they all they have all kinds of different methodologies of compensating.
Executives.
And what the comp committee does in the future I, you know all deferred to them but.
We historically have we have done it in cash and then.
Members of the of the.
I can speak for myself only it is that do we go out and we purchase shares in the open market when we're able to.
Okay. Thank I may call Oh, yes, our curious for more of a your accrual versus just one quarter. So that makes sense and thanks for the color on Q1, because they think that that can happen were you finished the quarter on pretty much.
Exceptional situation and that may or may not be repeatable, even though the here looks fantastic. So I definitely appreciate the color on Q1, and we'll look forward to the next next call.
We sincerely appreciate your time in question.
Thank you we reached end of our question answer session I wanted to turn the floor back over to Mr.. So tell me for any further or closing comments.
I would like to thank everyone for joining us on the conference call. Today also I would like to express my sincere thanks to our shareholders for their continued support.
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