Q1 2020 Earnings Call
[music].
Good afternoon. My name is fleeting there'll be a conference operating today.
Oh like to welcome everyone did opinion <unk> 2020 conference call.
Oh I had been place on you to prevent any back a nice actually speakers to marks there'll be a question and answer section if you like to ask questions during that time.
<unk>.
Number one on your telephone keypad, if you would like to your question press the pound key thing Q. It didn't sound like pressured to tend to cause <unk> investor relations for Penumbra, Miss Hamlin, Harry if you only big in your conference.
Thank you operator, and thank you all for joint here on today's cool to discuss the numbers.
For the first quarter Twentytwenty, a copy of the press release and financial tables, which includes a gap to non gap reconciliation can be viewed under the investors pad and now company website W.W.W. dot pin number <unk> dot com.
The cost of this conference call. The company will make forward looking statements, but if you went to the same copper provision of the private Securities litigation reform active 1995.
Statements regarding our financial performance.
Station clinical trials regulatory status quality compliance and business trends.
Actual results could different materially familiar stated or implied by a forward looking statements you should certain risks and uncertainties, including noise referenced in our tend to use for the quota ended March 31, 2020, which is scheduled to be five with the L.D.C. on may 7th Twentytwenty as well as those described you know 10 K. for the year ended December 31 29.
Team, which is fine with the S.C.C. on February 26 2020.
We caution you against placing unto you relying on these forward looking statements and we encourage you to review out periodic filings with the S.C.C., including the 10, Q. and 10 K. previously mentioned from a complete discussion of these factors and other risks that may affect us to results for the market price of s. stuck, including but not limited to the impact of the Cleveland 19 pandemic.
Oh now business results of operations and financial condition.
The number just claims any due to update revised forward looking statements as a result of new information future events developments or otherwise.
This cool session financial measures I presented on a non got basis I reconciliation of gap to non get financial measures. It provided and I'll push did press release, we anticipate the prepared comments on today's cold run approximately 18 minutes, Adam Elsa pin numbers, Chairman and C.E.O.'s will provide a business update Maggie you in a chief financial up.
Well, then discuss financial results for the quota and Sri <unk>, President will make concluding remarks with.
That I would like to.
[laughter].
Today's earnings call will be structured differently than up higher earnings calls to dress not only are quarterly performance, but also the larger considerations surrounding the covert 19 pandemic.
Pandemic has had and will continue to have significant impact on a global society held an economy.
But for numbers handled challenging times before.
We we have never faced anything like this.
However, our mission and our culture of always served as important guides during challenging times and we believe they will continue to help navigate us through this unprecedented period.
Starting in early March we took several immediate actions in response to the pandemic.
These actions first focused on keeping our employees and their families physically safe.
Economically secure.
Our next focus was making sure that we were able to supply and support our customers suppliers in business partners, all of which allow us to serve our first priority patients.
We all hope that this pandemic is over soon and then we can return to more normal work environment.
But the measures we have put into place.
Able to number.
Operate in this new safe manner for as long as necessary.
And they allow us to return the operating in this manner, if additional waves of this pandemic where to come.
This gives us great confidence that we will be able to satisfy our mission throughout the course of this pandemic.
The specific company actions that we have undertaken can be captured in the following strategic priorities burst restructuring our manufacturing operations to keep our employees safe during the pandemic.
Second mortifying or already strong balance sheet.
And third positioning pin number two emerged from the pandemic even stronger.
I will be getting my commentary by sharing what we observed in the first quarter.
And I will include early trends that we saw in April.
Well then address the more important topic about how we intend to operate the business effectively during this pandemic and ultimately emerged from it when it is over.
As it relates to our first quarter results are total revenues for the first quarter were $137.3 million a year over your increase of 6.9% is reported and 7.6% and constant currency.
Excluding Japan are constant currency increase was 14.3% over last year and sequentially flat versus the fourth quarter.
We had operating income and a quarter of point $6 million compared to an operating income was $11.2 million for the same period last year.
Maggie will further reviews of financials, including some additional period expenses that we've taken in the quarter and she will also provide detail on our balance sheet and her commentary.
And the first quarter, we began to observe a negative impact on business trends due to cope in 19, particularly in March.
I will share a certain observations that we have seen in our business through the and through the month of April.
Oh It is still early in the pandemic, we have started to see signs of stabilization.
However, it is important to know that these are our current observations and we can see rapid changes based on a number of factors.
United States and countries around the world.
We have seen the nature of revenue declines compared to normal <unk> trends very by geography procedure type and channel.
Geographically impact tour business was initially observed in Cobin 19 hot spots and then more broadly is communities proactively adopted strict physical distancing measures.
Globally for the month of April.
Our daily sales trends in direct geography is have declined on average around 35% versus pre cobot levels.
Within the United States in Europe, our sales in April have trendy down around 30 per cent versus pre Kobe levels.
As a reminder, their percentage changes that we are sharing their versus recent trends for the three months pre coded. These figures are not year over year growth rates.
As relates to procedure type or neuro business has generally been more insulated.
The United States in Europe average daily sales in April have trendy down between 20% to 25% compared to pre covert levels.
Turning to our vascular business, we've seen around the 35% decline versus pre Kobe trends.
Greater percentage of our vascular procedures are elective in nature, and we have gathered the the number urgent cases presenting at hospitals are significantly.
Lean down for norm.
And stressful thrombosis, resulting in D.B.T.P.E. and lower extremity arterial occlusions.
It is too early for this to show up in our numbers in a meaningful way, but it is developing phenomenon that we are paying close attention to.
Lastly, as we look at many of our internationals distributor channels, particularly in China, and Japan, We believe they will.
We'll show it lagging effect related to cope free to highlight a few positive operational and pipeline developments that occurred in the quarter prior impact of coded 19.
In January we held a ribbon cutting ceremony for a new production facility in Roseville Calif.
This facility will more than triple R. current manufacturing capacity in the long term.
But in the short term it gives us the advantage of having significant additional space to increase our manufacturing capacity wow, maintaining physical distancing protocols for the safety of our employees.
And late February in early March we received two important updates regarding F.D.A. clearances, one in neuro and one in vascular respectively.
Both regulatory clearances came early.
Here than expected, we'll adjust or timeline to launch these new technologies to when it is appropriate to engage your position customers. This additional time will allow us the opportunity to refine our commercial strategies to be even more effective in this new environment.
The final point about the first quarter is to acknowledge.
And commend the extraordinary work of the entire pin number team and addressing the issues and challenges related to cope in 19, starting in early March.
The team is shown they have the character.
Resilience and capacity.
To navigate the company through this difficult time.
We have lots of stories.
Amazing work being done.
But I think everyone. It pin number would agree that it is appropriate to call out the incredible work.
Of our production and operations teams.
In addition to restructure and how we make inspect in ship product in a manner that keeps all our employees as safe as possible.
We also faced another challenge in mid March.
Just as we were starting on this new journey.
An earthquake of 5.7 magnitude hit the Salt Lake City area, where we have a warehouse with significant inventory.
Oh people and the inventory we're all safe.
But it took incredible hard work and sacrifice from a team from California, and the team in Salt Lake City to return the warehouse to normal function within 24 hours.
This heroic effort resulted in minimal to know disruption in our ability to supply or critical products that those in need.
Now is to take a few moments to address the strategic priorities that I previous outlined.
We have fully restructured how we make <unk> inspecting ship our product so as to prioritize the health and safety of our employees.
This means we are operating within the physical distancing and the other protective protocols mandated by our local and state governmental orders.
We have been able to make substantial changes that allow us to do this and so far keep up with that van for our products.
In addition, our commercial team has communicated to our customers that we are here to support them when they need us, but otherwise we have gotten out of their way.
Tackled the mini critical issues facing healthcare professionals today.
We have also moved to protecting fortifi already strong balance sheet.
We have approximately $170 million in cash and no debt.
In addition, or team work quickly to put into place 100 million dollar revolving line of credit with J.P. Morgan Bank of America and Citibank. We believe this is a prudent way give us additional access to capital to navigate the current environment.
And finally, we are positioning ourselves to emerge humans stronger and then new environment. Following this pandemic.
This work involves streamlining some of the work flow and decision, making in certain functions to take into account. The extraordinary on leadership that has emerged during this time.
We have also where do you imagine how're commercial teams will and should interact with our customer's going forward.
Allowing us to be supportive and helpful, but taking into account the new paradigm.
Further we have continued investing in important opportunities. For example, we have accelerated development programs for the real system to address new opportunities that are emerging directly from this pandemic.
We will keep looking for internal and external opportunities that are critical.
Unnecessary help patients during this challenging time.
I would like to in my comments today by noting that during a once in.
In a lifetime crisis.
People as well as companies.
We'll all be measured by attitude.
Our willingness to help.
And our compassion for others.
I am proud to say that every person that pin number has risen to the challenge of this moment.
And I am honored to work with them.
We want to express are incredible.
Will admiration and respect for our health care workers.
First responders in other workers in a central businesses that work, so hard to keep us all safe and healthy.
And most importantly, all of us up for number one to remember and mourn the loss of so many people in the United States and around the world.
Our thoughts are with their families and communities.
Well now turn the call over to Maggie.
Thank you Adam Good afternoon, everyone I hope you and your families as safe and Wow.
But the first quarter end at March 31st plenty of 20 hours total revenues square $137.3 million and increase of 6.9 per cent reported and 7.6% in constant currency compared to the first quarter of 2019.
Oh geographic makes of sales in the corridor, where 70 per cent U.S. and 30% international.
Niro and vascular represented 57% and 43% of sales respectively.
Revenues from Al basketball, a business or $59.3 million in the first quarter of 2020 and increase off 26.2% reported and 26.5% in constant currency.
In the corridor.
Color growth Luster, then dive results from those out some back to me and embolization businesses.
Revenue from our neural business, where $78.1 million in the first quarter of 2020, a decrease 4.2% reported it and a decrease of 3.3% inconstant currency compared to the same period a year ago.
Excluding Japan on your own business grew 5.1% compared to the first quarter 2019, and flat compared to fall quarter 2019.
Oh and you are performance was primarily driven by sales have up a number system for a ski make stroke.
Oh gross margin and a quarter was 64.1% of revenues compare to 65.3% of wrapping used for the same quota last year.
I have to code that 19, Oh production capacity efficiency and productivity have constantly improve over the course up last 12 months.
Oh first quarter 2020 margin performance reflect volume, they're leveraging with minimal impact from after selling price end product mix.
During the quarter, we maintained overall manufacturing spending at fourth quarter 2019 levels as we made a conscious decision to continue to pay off out direct labor at 100%, while reducing labor capacity per shift to a cheap socio distancing unemployed safety measures.
As a result, certain labor costs were reflected as additional period expense in a quarter.
Reduce labor capacity, where offset by overall productivity to support a man.
The second quarter, we expected outgrows margin will be lower as a function of falling option.
Total operating expense for the quarter was $87.4 million or 63.6% off rather than you.
Compared to $72.8 million are 56.6% up revenue for the same quarter a year ago.
During the first quarter of 2020, I'll operating expense reflects limited reduction related to activities restricted by Cove at 19, such S. travel and entertainment expenses.
In the near term that will be some natural reduction in expense at it relates to the current environment.
We have also implement it out cost control measures for example, actually share in our pre announcement more than 20 senior executives have voluntarily taken substantial temporary salary reduction.
Why are we continue to be disciplined and controlling spend we will also continue to prioritize how investment in our production capacity commercial channels, new product launches and new product development.
Our research and development expenses were $12.9 million for the first quarter 2020, compared to $11.7 million for first quarter 2019.
S. G.N.A. expenses were $74.5 million for the first quarter 2020, compared to 61.1 million dollar for the first quarter 2019.
We had operating income and a quarter of C. zero point $6 million compared to an operating income up $11.2 million for the same period last year.
Turning to our cash flow and balance sheet.
And their first quarter 2020, with $168 million in cash catchy coastlines, and marketable securities and no debt.
In the quarter outcasts usage of west $20 million, which was higher than usual they use stuff cash in the quarter was primarily related to building up inventory securing material supply, making capital investment associated with new product launches and general tightening up certain cash outlay.
On April 24th in order to further strengthen now liquidity position, we close on $100 million revolving credit facility with J.P. Morgan Bank of America and city quit.
In addition to the company's current strong that cash position.
Evolving line of credit for that bus to access to capital, which allow us both.
To navigate the current environment and to the opportunistic.
And now I like to tend to call history for closing remarks.
Thank you Maggie.
Is that I mentioned in his remarks number has handled challenging times in the past.
Our mission has helped set our direction in our culture has helped our team execute in order to protect our employees and or a stake holders.
Well, we may still be early in this pandemic, we have started to see signs of stabilization.
Had been able to assess the near term impact on our business and take significant actions to refine our operations and afford a fire balance sheet within weeks.
These early actions are important and necessary steps in order to make the right long term decisions for the business.
These are the defining moments for any organization and I'm confident that and number is as well position as anyone to emerge from this crisis as a better company.
I also want to extend my gratitude to every number employee for the sacrifices each are making during this time.
And I also want to think that thousands of health care professionals and first responders were making it possible for us to be safe and for us to do what we do each day. Thank you.
And now we would like to open the call the questions. Operator. Please go ahead.
This time, although to remind everyone in order to ask questions pressed far beyond the number one on your telephone keep well, possibly just a moment to compile bikini roster.
And your first question.
From.
Robbie markets from J.P. Morgan you're <unk>.
Great. Thanks for taking the question.
No I just want to start it seems amazing to me that you spend your narrow wrapped use our down that much and second quarter to me. It implies that people are dying at home with strokes rather than going in hospitals. So was wondering if you can talk about some of the trends you're seeing the air and.
If this more up in April type of that then while just I see use where and how ours, where overrun quits coded patients or do you think this is something that can extend longer as as patients rather you know not going to a hospital than get treated.
Yeah, Hi, rabbits, Adam it's it's a very valid question I I think.
You have a number of different.
Sort of thing happening, obviously within pastoral communities at all across not only the United States, but but the rest of the world one of the phenomenon relates to sort of what.
What is happening inside the hospital itself, obviously stroke and and and number of the other conditions that are considered critical there's a lot of publicity around patients not <unk> going into the hospital and there's been this in the lay press as well.
As in scientific journals, whether it's harder tax or strokes or other critical issues. There's a time frame you know, particularly acutely in late March in into April where where those numbers were dramatically down. So I think that's you know that that's what a lot of that is.
Where people we're concerned are anxious about going into hospitals. The the assumption is because they didn't want to get the virus by going into the hospital. We we don't know the the exact reason for that but but that's the premise.
And that's probably the the bulk of this you know hospitals you know.
Are and we've confirmed this with a number of our our customers and well hospitals that you know, they're they're rethinking how they're going to operate going forward anyway. You know there's a lot of a sense that you know this is not over a indeed.
I'm in the short short time.
And they're going to restructure how they think about and treat patients and make sure in their communities. They get the word out that they they can be a safe place to come you know some hospitals you know and this is just anecdotally are talking about having separate influences on one size hospital versus the other for.
Covin patients versus patients that have noncovered conditions, you know physical barriers within the hospital. So that the those areas are are segregated and I think those are the types things that we'll see those the the community.
Reaction to those issues change and and again, we're seeing that already in that in the last week or two you know a little bit positive trends in that direction. So so I think we have some optimism that.
Critically ill patients you know, we'll we'll be able to feel comfortable going into most hospitals going forward.
Mm.
And maybe on the flipside in <unk> Indigo keeps station out I see use and it and let them Korea up space and like patience with the hospital faster. So I I know it's hard in in this time to go and sell actual product.
In the hospital, but if this say turning point, where you think it could them a greater adoption. If you go for these patients. Thanks.
Yeah. That's that's a really good question I think indigo has a lot of interesting points right here, you know sort of it it there's no doubt that at the most fundamental level. That's true you know dripping T.P.A. typically requires going.
Ended I see you in monitoring 'cause patients carefully versus you know just removing caught that was one of sort of the premises of the product.
I I do think.
And I called that out in the prepared remarks, specifically on indigo that the.
The drop in in cases is partly due to the same phenomena I just addressed about people not showing up in the first place. So so it's not a question of them showing up and and being put into a nice to you, but them not showing up in the first place I think you know adding to that is the other part.
Here, we are seeing and you're seeing this it again in the late press there was some articles around this particularly around younger people in the stroke recently, you know that there's this this phenomenon you know sort of of hyper <unk> coming from these patients are happening.
Which you know is is a horrible additional sort of condition or tragedy to bestowed upon these patients, but one in which positions are are wanting to learn how to address and deal with some of those issues. You know the the last the worst thing is that you.
You don't you're not dying sort of the typical respiratory issues, but you end up dying of a p. E caused by the virus.
So we actually put on not eat a product specific type.
We have an hour recently, but a a week or so ago a cross <unk>.
Disciplinary webinars around just how do you treat these patients you know with the sort of large thrombus burdens that that they've developed we got you know over 400, and you know registered physicians sort of dialing into listen because it's a really growing issue.
And we've seen.
You know that this sort of you know little bit about tick in in those numbers in the last week or so you know, which gives us some sense that that they're getting cared for the right way and in addition, you know unlike.
Sort of just a regular product you know where the appetite for it might be different you know we do as you know have a clear newly cleared indigo product that was cleared before this happened that we haven't launched and I alluded to to you know being able to.
Come up with and develop.
The right the right format and way to do that in this new setting and paradigm in and and I think there will be a significant interest and appetite for particularly now given the things. We just said that could be helpful to physicians and patients even coded patients right now.
Now so that gives us sort of proper mission around that in the next you know quarter to.
Oh.
<unk>.
Mm.
Yeah.
Robbie do we lose you.
Raider.
Excuse me Mr. Marcus here alone is still open.
Oh I I'm always had thank you very much operator.
Thank you. Thank you.
Moving <unk> we have.
Laurie They go from from Wells Fargo No thing.
Hey, guys. Good afternoon. Thanks for taking the question to for me one the new products one on Japan. So first Adam she had to meaningful new product approvals here I know, you're not laundry them immediately because of <unk>, but I'd be curious to hear from you yeah, what's incremental what's new.
And different about these two products jet seven extra flex Max I, enduro and and to go with a lightning and and and I had a bottle effects.
Well.
<unk>, Larry for asking that I, I I'm not going to go into sort of the the specific technical improvements in in details around those products.
On this call and and I Hope and then and appreciate I Hope you appreciate.
Why we will wait until we're ready to sort of share that with the the the physician community but.
Nevertheless.
Particularly on the indigo side not to take away from the stroke product, but the indigo one I think may find a particular receptive audience given the things I I said to answer Robby's last question and I think it will make.
You know fundamentally the procedures Ah faster more efficient and more complete and I think at at time like this particularly with coded patience with some of these issues. It will be it will be an important addition to our our offering.
The top you had a question.
Yeah I can question I did so on Japan. Thanks for the color on that it sounds like Japan without about seven and a half million dollars here every year and Q1, how do you see that playing out over the rest of 2020 I think Japan was you know $43 million for you guys. In 2019, I think you expected it to be down about you know 24 <unk>.
In year over year somewhere in that ballpark. When you provided you're guided so any update there would be helpful. Thanks for taking the questions guys.
Hi, Larry a treat I'll I'll take that one so on on Japan, you know, obviously, you know with the Kobe 19 pandemic were watching that closely that's the obviously the the major sort of news since our last call an update on it we're going to watch it closely I I think the code.
<unk> occurred the way we had expected it from our last call in in your comments and that continues to be our expectation, but obviously with a large caveat of of the Kobe 19 pandemic.
Understood the X. Ray.
<unk>.
Your next question, it's from July Lancz from city here <unk>.
Yes, Hi, this is a net henriksen end per Joanne. The first question we have is on.
Real under stroke rehabilitation centers, how are they adapting to this cobin like you know environment kind of mainly how much can be done with these patients through tele medicine, and how much requires and centre visits.
That's great question and I.
Glad that to answer it so there really are.
Several different forums or or locations in which we had planned for an invasion the real system to be helpful to patients starting out in the acute centres hospitals in which they're treated going into sort of.
A a more typical inpatient rehab experience and then kind of going to outpatient rehab at the end of that the the first two are still.
Valid you know patients are in those facilities are certainly getting treated maybe the numbers are slightly down is we'd come into the first stroke, but they're still in acute centres and and there's certainly also in inpatient clinics and in those settings are being treated it's hard to.
Launch a product in the middle of this you know and and go to those centers and have the conversations. So you know we're looking at alternative nested rather than and just sort of the typical process that we had started at the beginning of the year around getting the product out and and.
How we did that and I think we're we'll we'll be able to sort of give some more detail on that yeah.
In the near term.
That being said the outpatients facilities are really very very different you know many of those are are closed.
And are really not in this situation to to continue the the in in the process in the manner that they were doing beforehand because of physical distancing rules are mandates or just fear around I'm getting that done there's been some discussion and movement.
Into sort of more of a tele rehab type of model hard to do that pretty well you know you're really talking either over the phone or peace time or or meeting to encourage somebody do things that are hard to do and even if you were in the room with them.
And you know there's opportunity, obviously and I alluded to it in my prepared remarks to dramatically improve in address some of those shortcomings that have come from from this terrible pandemic. So stay tuned for more details is it is it emerges.
But I think there's the existing need is there and there's some new opportunities that I think have developed.
No. That's that's great color. Thank you for that and then just my follow up you talk about Oh daily sales trends globally were down about 35% versus kind of pre kobe levels and I just want to clarify if that includes the <unk>.
And impact from the reimbursement change.
Yeah. It's.
It's a great clarifying question you know we.
Said, Iraq, so that kinda distinguish that obviously the.
Daily sales are are different with distributors, they're not they're not so daily so that would reflect sort of direct global sales.
Okay, great. Thank you very much.
Thanks.
Q next question, if I'm Margaret 'cause art from <unk>.
Yeah, it's nice for taking a question.
And maybe the first one for me to talk a little bit about market development effort your strategy around that drink a pandemic in and frankly and a quarter. Thereafter, so yeah, yeah, what kind of stopped or partnerships, maybe yeah that you wouldn't take to have it to both paper Trail education platform for Purple for example, and then kind of similar.
And what 10 virtual sales just because sales have probably change not only for now going forward and what's essential employees and so on thanks.
Yeah. Thank you it it's a great question you know there's there's the obvious.
Sort of thing that.
I use one example of a a web in R. that got a fair amount of attendance just to on a topic sort of very relevant to to this crisis, but.
They're they're obviously are going to be ways that we threw virtual technology can can interact and and deal either in large groups are are smaller groups. There is you know one story that emerged where there was a position in a hospital, who they had indigo.
In the hospital already from different physician, who had used it but this particular position hadn't they had a kobe 19 patient develop a great large thrombus load ended up causing a P.E. and through you know just face time, if I'm not mistaken you know was able to.
Sort of get trained by our sales Rep remotely you know have the sales were up there and support in the case again, all coming from the physician asking and reaching out toward team to be there to support and ended up having a a really.
Gratifying and remarkable results for that particular patient. So there there are going to be and and there are ways to to be supportive position community. During this time frame.
One can sort of think about this and say you know how long does is go how does it fundamentally changed the way we in rock and without sort of sharing you know every detail of our plan I I can tell you that that we're really I think excited I.
That through this we can develop much sort of later touch ways you know the traditional way that we operated as as most med Tech companies do which is pretty high touch you know you go in you. The hospital you meet with your your customers you.
Talk to him about your products you sort of go through that process.
We saw that play out in our vascular business for last number of years you know it takes time to sorta do that and I think there are ways to accelerate that with a light or touch.
That doesn't require so much sort of hands on interaction and we'll start to to show that you know and and test those things out again, when it's appropriate when there's a need and desire and probably the first will be the the beginning of the launch.
Indigo product coming up.
Okay, Let's hope one <unk>. This is another question, it's kinda similar along those lines or inclination, but.
Time right now during the pandemic. So a lot of these guys are facing operational pressure. It's income things are starting to talk about how they can be helping with them not only just for these patients that they treat but just hoping on what their business running thing maybe in a way that they didn't really think about they're not.
So yeah, maybe give us a sign says things that you're doing right now it's not help them screw that that time period and that might be different from your peers.
Yeah, So I'm not.
Exactly sure. The question around you know what are we doing to help the hospital themselves themselves. Obviously, we will be there. However, we can to support them.
We you know some.
Sometimes our products are used where <unk> you know we're bringing in inventory you know there's a particular case that requires you know extra inventory or things like that we're able to continue to do that at request. So we've developed the capacity to do that in in maybe broader.
Way, particularly as we hear more about elective cases, getting scheduled and the need for you know sort of <unk> moments of inventory as opposed to sort of overall power levels is increasing cost effective ways to do that the team here is developed I think a lot of.
Capacity to to support that you know again, our ability to to be there and respond to requests as opposed to sort of take a more sales approach and try to convince them to use our product and then really well received by.
Across the board from our customer base and and that that sort of these are primary.
Focus right now, but I think they come out it if they started doing more elective cases, it really is being there to.
One with inventory into with expertise they want it.
Great. Thanks.
Margaret Thank you.
[noise] again, if you like ask a question Prostar Burns it number one on their telephone keypad again Catholic crushing simply pass <unk> on your telephone keypad.
There are no further question at this time mishandling horrible I turned the call back over to you.
Thank you operate on behalf of that management team. Thank you all again for Johnny yesterday, and <unk> interesting <unk>, we look forward to updating you on a second course at home.
[laughter].
It's concludes today's conference call give me now disconnect.
[noise].