Q1 2020 Earnings Call
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Good morning, and walk into todays program. My name is cheap and I'll be your conference operator.
At this probably like to welcome everyone to Eagle Pharmaceuticals first quarter 2020 earnings results Conference call.
All lines have been placed on mute to prevent any background noise.
After the speaker's remarks, there will be a question and answer period.
At that time, if you have a question. Please press star in one on your touchdowns out.
As a reminder, this conference call is being recorded today May 11 2020.
Now my pleasure to travel the World Forgive me, if Lisa Wilson Investor Relations for Eagle Pharmaceuticals. Please go ahead.
Thank you key welcome to Eagle Pharmaceuticals, first quarter earnings call.
This is Lisa Wilson Investor Relations for Eagle Pharmaceuticals.
With me on today's call, our Eagle Chief Executive Officer, Scott Tara.
And Chief Financial Officer, Pete Myers.
This morning, the company issued a press release.
Telling financial results for the three months ended March 31st 2020.
The press release in a webcast of this call can be accessed through the investor section of the Eagle website at Eagle U.S. Dot com.
Before we get started I would like to remind everyone that any statements made on today's conference call that express equally expectation.
Projection for cat anticipation or intent regarding future events and the company future performance, maybe considered forward looking statement as defined by the private Securities Litigation Reform Act.
These forward looking statements are based on information available to Eagle Pharmaceuticals management as of today.
And involve risks and uncertainties, including those noted in this mornings press release and our filings with the FCC.
Such forward looking statements are not guarantees of future performance.
Actual results may differ materially from those projected in the forward looking statements.
Eagle Pharmaceuticals, specifically disclaims any intent for obligation to update these forward looking statements, except as required by law.
It telephone replay will be available shortly after completion of this call.
You'll find the dial in information in today's press release.
Archived webcast will be available for one year on our website at Eagle U.S. Dot com.
For the benefit of those who maybe listening to the replay or archive webcast. This call was held and recorded on May 11 2020.
Since then Eagle Mad men announcements related to the topics discussed so please refer to the companies. Most recent press releases in FCC filings.
And with that I'll turn the call over to Eagle CEO Scott Tara.
Well, thank you Lisa and good morning, everyone. Let me begin by acknowledging that the world is a very different place from what it was just too short months ago on her last earnings call.
Tobin 19 has had a profound impact on all of.
The way we live our lives.
The way, we must conductor business.
We've had a lot of news lately, obviously, we had a very good quarter.
We had the Eau de affirmation had a favorable bendeka Pat rulings and we've had good news unfolds.
It's still this year, we have a lot going on with visa precedent and the potential to bring it to markets. This year.
We have our E. H S. PDUFA date in July and we're still expecting to file for brain damage secondary to nerve agent exposure if not this year than early next year.
You still expect that we can have five launches in the next three years NHS full the strand phase of precedent our collaboration with time technologies, where there is a technology products and 88.
Finally pen fixie.
A truly remarkable lineup.
Top of all of this there are all our other remaining projects for acute radiation syndromes, you want 11, which is a new chemical entity for dantrolene.
Alzheimer's traumatic brain injury for a total of 13 key initiatives.
If at all shakes out the way, we hope as I said on our last earnings call 2020 could turn out to be the test year in Eagles history.
In terms of total revenue and gross profit.
Correct.
We expect that the aggregate ryanodex revenue, we generate for the balance of 2020.
Even in the absence of the label expansion will exceed aggregate revenue for Ryanodex in all of 2018.
I'll touch on all of this but let me start with the corridor.
We had a great first quarter generating EBITDA of 15.2 million in diluted non-GAAP EPS of 84 cents.
The balance of 2020, we'll continue to be very active for the company as we advance numerous programs across the board.
It was strong capital position allows us to apply our best scientific talent to address.
Some of the most challenging underserved therapeutic areas.
Q1, we invested $10 million for 55 cents per share to advance our pipeline.
Alluding legal expense.
Let me start with oncology business, leading off with our full this ran product candidate EA 114th.
For estrogen receptor positive advancements can.
Last quarter, we shared that we were refining our program.
As announced last week, we have conducted their pilot our pilot work and we met our internal objectives.
We will be requesting a meeting with FDA to determine what the next steps are and we look forward to updating you on the progress of this potential best in class treatment for HR positive advanced breast cancer.
Let me also touched briefly on another important and somewhat overlook contributor to oncology portfolio Symbio, Our Japanese licensing partners completed clinical trial enrollment for their rapid infusion vendor must team product.
Pilot intends to file in India in Japan, with the expectation of obtaining regulatory approval on the second half of 2022.
Last September Symbio also filed in India for their Bendamustine ready to dilute product.
With an expected approval later this year, because you may recall eagles entitled to a $5 million milestone payments on approval of either of these Andy A's and starting this year the royalties could be meaningful.
Roughly $10 million to $25 million per year for Symbio first launching the 500 ml bag and then the 50 ml bag.
Now turning to Bendeka.
Two weeks ago, the courts upheld ever patent infringement claims is valid.
Meaning the defendants in the case will be enjoying from launching their Andy a products before 2031.
This important protection Wilkes the value of our Bendamustine assets and enable us to continue investing in our active research and pipeline programs.
In addition, we had an appellate court victory confirming orphan drug exclusivity for Bendeka.
As a result of Ft A's decision regarding the scope of Eagles orphan drug exclusivity no bendamustine products, including generic versions of transit May launch into you asked before December 7th 2022, unless clinically superior to Bendeka.
We see this as another driver supporting our growth and our active research pipeline going forward.
In January we also added to our in college portfolio through strategic collaboration with time technologies.
Advanced SM 88, A. late stage novel therapeutic aimed at difficult to treat cancers. Our initial investment of $20 million give this gives us a co promotion right on SM 88, as well is 10 million shares of times common stock along with the opportunity to increase our investment under certain.
Circumstance.
Hi May all stay out Eagles rights under the promotion agreement at any time for $200 million, we look forward to providing further updates on this collaboration.
Finally in Q1, we receive final approval from F.D.A. for Penn Fixie following our settlement with Lilly with initial market entry of a three week supply of a limped on February one 2022, followed by an uncapped entry on April one this launch period represents a another.
Before.
Turning now to our critical care business, starting with visa Preston.
As noted on our last call. The trial was scheduled to begin this month.
Due to the covert pandemic the trial has been delayed and a new date has not yet been set.
The court agreed to allow eagle to file a letter requesting summary judgment of non infringement for which we believe we have a strong position.
Our letter was submitted on April 17.
And pars responsive letter was submitted me.
This request is is currently under consideration and the parties have a joint status call with the court for May 18 at which make further guns.
The trial date in summary judgment requests vasopressin is very important product to us.
You are the first to file and Andy a reference referencing basis strict 20 units per one ml and anticipate having a 180 day regulatory exclusivity as we await further guidance from the court being anticipate that we will receive tentative and for approval in time to launch the product later this year and take it.
Vantage of this market opportunity.
Now, let's turn to Ryanodex.
We have already Hs PDUFA date coming up on July eight we expect the art what will be our last study for the treatment of brain damage secondary to nerve agent exposure this year.
And to have it filed shortly thereafter, we are still hopeful we can submit an end da for this indication if not by year end than early next year.
Our animal studies of Ryanodex for the treat traumatic brain injury in collaboration Northshore University Hospital are progressing night nicely, albeit somewhat more slowly due to the car current covance environment.
Our newest Ryanodex program for is for coated 19.
With its potential to reduce the impact of the lifecycle of the virus.
In mid April we announced that Ryanodex for injection suspension inhibited the growth with Sars coped.
What's causing the cobot 19 pandemic trialed in vitro laboratory tests.
Working in partnership with Hackensack University Medical Center, we have submitted an investigational new drug application with F.D.A. for a phase two clinical trial to evaluate the efficacy of Ryanodex in infected patients are meeting with FDA shortly to discuss our proposed trial and we'll report back following that meeting.
As I mentioned at the outset.
As our unprecedented times for our country for the world and for our industry.
So as you can see this is an important time for eagle with multiple near term inflection points and we're certainly excited about our prospects with that I'll turn the call over to Pete to discuss our first quarter financials seat.
Thank you Scott.
First quarter 2020, total revenue was $46 million.
Okay to $49.8 million in Q1 2019.
Product sales during the first quarter increased by $3.2 million year over year.
Going $17.7 million compared to $14.5 million in Q1 2019.
I really driven by $7.4 million increase surrenders IX product sales due to historically large expertise cycle.
1.3 million dollar increase infill, Rob so sales, partially offset by a $5 million decrease in and take a pass through sales to Teva due to the timing of inventory deliveries.
Perhaps or product sales were $4.6 million in the first quarter compared to $3.2 million in Q1 of 2019.
Eagle recognizes the rupture revenues on shipments by Eagle to wholesales.
Based on IMS data Eagles, marketshare up and the most team wholesale shipments to end users was 7% of the U.S. spend the money markets for the first quarter.
Social distancing measures and shifting priorities of patients in health care providers in the wake of the covert 19 pandemic.
Resulted in reduced utilization of many physician administered oncology products.
Beginning late in the first quarter, we've observed this impact on the venomous team or could that impact has continued through April.
We anticipate this trend abating as we move through the second quarter.
First quarter index products sales were $11.4 million.
Compared to $4 million in Q1 or 2019.
What is for Ryanodex are cyclical.
Driven primarily by product expertise.
First quarter 2020, some of the greatest number of expertise over index since its launch.
Right the challenges to a commercial efforts and accessing our current and potential customers precipitated by the covert 19 pandemic, particularly in the second quarter.
We continue to expect record sales for the product for the full yes.
Given the expertise cycles in Q1, we anticipate the first quarter 2020 will be the high watermark for the year.
The first quarter rent is X had a 54% market share of normalized dantrolene injection units.
Q1, 2020 royalty revenue was $28.3 million compared to $26.3 million in the prior year quarter.
Deck royalties were $28 million compared to $26 million into first quarter 2019th.
He will continue to receive royalties from to about a 30% royalty rate following or amended license agreement until October 1st 2020.
Well the rate will increase to 31% for the following 12 months.
Then to 32% on October Onest 2021.
We will remain for the life of the product.
Gross margin was 83% during the first quarter 2020, as compared to 74% in the first quarter 2019th.
Expansion in gross margin in the first quarter 2020 was driven by an increase in rented excels.
Well, we're been ducker product sales in the period to a marketing partner, which dealers no province.
And the increase in Bendeka royalty revenue.
On the expense front R&D expenses for $9.4 million for the first quarter compared to $6.4 million in the prior year quarter.
So year over year increases largely attributable to spending almost <unk> payroll expenses.
Excluding stock based compensation, another noncash or nonrecurring items R&D expense during the first quarter was $7.8 million.
We are reiterating our 2020 guidance that R&D expense on a non-GAAP basis will be 46 that $50 million as compared to $31 million 2019th.
The anticipated 2020 R&D expense includes one.
He onefourteen pilot trial in CMT initiatives.
To the REIT index trials, the treatment origine exposure acute radiation syndrome, and covert 19.
Three he won't 11, I, India, enabling toxicology studies CMC scale up activities.
Or E 112 play can development individual preclinical work at the University of Virginia, and military University Health system.
Hi, regulatory advocacy for Ryanodex CHS.
And six launched preparedness for visa president and potentially.
<unk> expense for the first quarter 2020 increased to $24.8 million.
At $18.1 billion in the first quarter of 2019.
External legal spend external sales and marketing spend stock based compensation ones as well as of today definitely dollar charge related to the time collaboration.
For most of the year over year increase.
Putting stock based compensation and on the noncash or nonrecurring items first quarter 2020, <unk> expense was $15.5 million.
We are reiterating our 2020 guidance that as cheetah expense on a non-GAAP basis will be $61 million to $64 million as compared to $56 million in 2019.
The year over year increases largely attributable to higher sales and marketing payroll, partially offset by lower external legal stuff.
If there anything <unk>. It's just label expansion is approved we will revisit 2020 operating expense guidance accordingly.
Net loss for the first quarter was $2.9 million were 21 cents per basic and diluted share.
Compared to net income was $9 million.
64 cents per basic and 62 cents per diluted share in the prior year period.
Adjusted non-GAAP net income for the first quarter 2020 was $11.7 million for 86 cents per basic and 84 cents per diluted share.
Compared to adjusted non-GAAP net income of 14.6 million dollar for dollar five per basic and it's on a one per diluted share in the prior year quarter.
For a reconciliation of non-GAAP net income to the most comparable GAAP financial measures. Please see the tables at the end of our press release.
EBITDA for the first quarter of 2020 was $15.2 million compared to $18.8 million in department stores.
As of March 31, 2020, the company had $202 million in cash and cash equivalents at $54 million and net accounts receivable.
34.5 million of which was different though.
Company at $148 million, an outstanding debt, including 110 million dollar drawn on our revolver.
Therefore as of March 31, 2020, the company had net cash plus receivables of 108.5 dollars.
As far as 31, the company is repaid $110 million evolved.
The first quarter 2020, we purchased a million dollars of Eagles common stock as part of $160 million share repurchase program.
From August 2016 through March 31, 2020, we repurchased $172.9 million of our common stock.
With that operator. Please go ahead and open the line for questions.
And that there is time, if you'd like to ask your question. Please press the star one on your Touchtone telephone.
As we move yourself by pressing the pound <unk> once again that star and one on your Touchtone phone for questions.
We'll go first today to Tim Lugo with William Blair. Please go ahead. Your line is open.
Oh, Thanks for taking my question.
And as you start as you mentioned in your comments you are kind of unprecedented times.
Maybe just outline.
Yeah, you're expecting.
Sequentially quarter to quarter over the next few quarters, given kind of a macro environment and what are you hearing some maybe distributors are young high smell contact given the Broncos environment for.
Let's use a possible based products and.
And Bendeka and now the availability of chemotherapy to oncology patients maybe just broadly what are you expecting Q2 Q3.
Sure. Thank you Tim.
I also remind everyone that also in the call with US today is David Pernock, our president and COO.
And Dr. Adrian Hapner, our Chief Medical Officer, and so Pete maybe you can chat a little bit about the quarters and then David a little bit about what we're seeing oncology, but Tim that's far business. You know relatively speaking seems pretty healthy because of lineup of products that we have but.
Do you want to add something.
Yeah, Hi, Tim good morning.
On the revenue side, we did note that there is some diminution in April in infusions of course, there has not yet impacted or revenue because we book revenue when we ship product to wholesalers. So we're keeping an eye on that and we hope and expect that that trend will abate as we move through the second quarter.
Okay, and then on the expense side are there areas.
Where you know lets you, obviously control a little bit more.
Which could offset some of that April issue.
Well.
Fundamentally we think our business as healthy as we mentioned earlier the R&D in our business is not linear rest you know he is as we've been through the quarters I'm as we look at it R&D spend you'll note that we are maintaining guidance for the year, which.
Essentially noting that the backend of 2020 will be heavier in R&D as it was last year just in terms of the timing of external clinical spend.
But [noise], we believe that.
Businesses is fundamentally healthy and and so we are comfortable with our cost structure.
Understood.
And David why not.
Yeah, Yeah, basically I agree with what what page. So do we expect that though at least you know a slight downturn in and oncology visits in the month of April was saying I think across our you know every company is experiencing that just because of the situation, but I. We expect that that'll start to return back to normal as you know more and more so states begin to.
Yup and so are they call. It all will be will be we should be in good shape. There are relative to ryanodex. So basically we have seen a hospitals ordering more ryanodex into situations in particular, where a emergency rooms for expanded outside their typical setting to and because of the cobot situation.
So often times what happens is diversity room.
Likely to do it intubation and often times that requires requires volatile gas surf orders to risk about makes oh, we see that we've seen that occur as well and likely what will happen. We think in the ambulatory surgery centers and in surgery centers in general.
A lot of the elective surgeries were delayed because of co that once things improve they're probably be a huge surge in terms of are those types of surgeries and so probably see some additional stocking due to that so all in all we're hoping to basically Oh do you know everything we'll try to balance out at the.
End of the at the end of the day.
Thank you for I think.
And Scott maybe one last question you know you mentioned five one to kind of over the near to intermediate term.
Yes, the pipeline, who have struggled productivity wise in the past.
In years or so.
Can you maybe just outline your opinions on those five watches which arc has the most.
And we like based Crystex that and what will be the most meaningful through on the economic that certain goes.
Sure.
Tim it's hard to predict somebody there, but were you know we feel good about.
Our projects I think if you just look at where they are you know PEM back the as a high degree of certitude, obviously and that could be very valuable product. Since we have the settlement with Lilly and we have a final approval.
Indicates the vasopressin you know we feel we feel pretty confident that we're going to wind up receiving very tentative approval in time and then we think we have been excellent position in terms of our litigation.
And then as you move down the line I will say that oldest Brad.
Is really exciting very important too.
So the whole number of levels. We believe that we have something that's very important patient population post menopausal metastatic breast cancer patients and that there could be a significant paradigm change if we're able to get that product than what we see so far in our pilot study, where we're very encouraged into that.
You know that's a strong possibility coming up as well and then beyond that you know nerve agents will run another animal model. There's no reason to believe that that next model won't be similar to the other models that we brought on previously and we get that product to the marketing.
You know Tim you would think who thought we'd be living in a pandemic. The way we are who wants to think that one day, there could be a nerve agent to tack on U.S. oil, but I think the country's preparing board and concerned about it the state of the World is the state of the world and that could be a pretty significant product and then we have the H S. Due to date coming up in it.
Couple of months so.
We'll see where coded leads us.
You know we think we have a good chance you know maybe you know all 30 projects that were working on maybe they don't all come to the market Ms took on our industry, but we feel good about our future.
Thank you for the color and I'm not got something.
Thank you.
Our next question from Randall Stanicky with RBC capital markets. Please go ahead.
Hey, Good morning, this is Tim buzby out for Randall.
Got a few questions first.
Yeah chest can you talk about your launch strategy and CE approval in July and how do you see colds in 19 potentially affecting that launch, especially at hospitals are still focused on depend on it.
Oh, yeah. Thank you Ben So E. H S launch you know could do to date coming up on the.
In July.
You're right. The you have to look at the two programs co bid and DHS in tandem.
It's been the event that we have products you know a product for coded eventually come into market, that's going to be a lot of Ryanodex movement, and then that Bob obviously, when you get into next year the potential of nerve agents as well, there's a lot of work that needs to be done as far as the launch of DHS in the summertime, David you want to make any comments about how we're hands.
I think that between now and the potential launch date.
Yeah, Yeah sure. So basically you know very good question, we understand so largely what.
When you step back and take a look and say picture for basically <unk>. Each has approved it actually Kobe it turns out to be a positive those we hope I ask me an awful lot of reasons for hospitals to want to stock Ryanodex you could imagine show.
We would expect architecture, you know a very big surgeon and orders.
As we try to serve as many people as we can't so I think overall, that's the that's important point to keep in mind on the other granular level regarding a chesters remains to be a very high interest from emergency room physicians.
And in treating DHS because of the unmet need and the inadequacies of of the current treatments that are available. So we think we're still going to feel a major league. Obviously, there's not as much of a sports going on as we all know I'm, so basically to be a little bit less little little less of that happening and.
Hopefully you know.
I will return to normal at some point, but there is some impact there we're going to basically it first for a c. you know business as usual Oh, we expect that basically our salesforce will be able to Ah you know contact works the room physicians through a variety of different methods. We found podcast in particular it'd be particularly successful vehicle for.
Emergency room physicians and you know will be planning on attending most of the emergency room specialty specialty.
Conventions et cetera to build field work, we're very excited about it you know because we've been working at it for a while she though it's still remains a very big unmet need and United <unk> again, we think combined with this with our other indications.
We're going to open up.
A situation, where others, there's a huge need for us for hospitals and stock Ryanodex and we think that could have a positive impact on even MH business is very because as Pete said, the first quarter, we had a 54% market share, but as a the as more as we as the value proposition for Ryanodex rose.
As we expected our overall our market share of the MH market to grow as well.
Great. That's helpful. And then one on base a person, let's say the court doesn't reach a decision before October but you do received tentative approval before then and that presumably places you in a position where you can launch at risk is that a decision you've given anymore thought too.
Yeah, that's [laughter], that's an interesting a scenario isn't it.
I think what's probably is going to happen I believed that the court is very well aware of the timing situation nobody expected again to be in this pandemic, let's see what happens in the next couple of weeks with our summary judgment motions.
You know I don't think this is a particularly difficult case to decide.
At least that's our view of things and depending on when to trial gets delayed to if we wind up having a trial then it would be up to the court to see if they can get a decision.
Put together you know around that 30 months date without delaying things too much in so when you look at the whole situation, we still think theres, a pretty good chance of getting to the market before this year's over and that's what we're planning for.
Okay. Thank you.
Well.
I'd like to remind everyone wanted newstar him one quick questions today, we're going extra Brandon Folkes Cantor Fitzgerald. Please go ahead.
Hi, Thanks for taking my questions Dan.
I've just got three maybe can you talk about to temper allocation not so the share buyback, but just in light of the potential launch and how are you thinking about just no [laughter] developments over the coming years, maybe secondly on ryanodex for coated paper, having just elaborate from Tim So.
<unk> patients you will be frogging targeting and where in the treatment paradigm. We should think of Ryanodex kicking in and then add last me I think like last week, we saw about correct to say a judgment with slayback should we be thinking about a generic trend and biorx are tied into markets where.
And Bendeka <unk> Grand got thank you.
Thanks, Brendan let me, let me take those in order on the capital buyback and how we see things.
Financially I'll turn that over to Pete for a moment, but you know business development continues to be interest to us as we outlined today, we have so many internal projects, there's nothing more efficient than having.
Gannett growth or if it works and as we outlined earlier, we believe that much of this well having said that so we think we're in great shape with our balance sheet into cash were generating especially if we start to get some of these products to the market and so I believe that we're still poised if we find the right opportunity to move on.
Our business Ford.
With both organic growth and by licensing in products, along the way and so yeah, we want to grow the company will do it and in both ways and we'll see where it takes us.
In terms of Oh wraps on then I'll turn it over to Pete and then overtake Adrian under Cobot question, but I'm terms, Oh wraps I think you're right I I believe in December 22, the way things look right now.
Well have a generic competitor for bell wrap so at the same time, we have generic competitors for transit.
And with that anything you want to add Pete to the capital side of things.
Well I would just I did note that we have since March 31, repaid the revolver brand that I'm sure you've noticed on our balance sheet, our cash and our debt balances or larger than where he was <unk>.
At March 31, we did draw it down to $110 million revolver in March we did that as we observed the drawn down in the equities market and that was certainly accompanied by considerable disruption in the credit markets at the time.
As it was manifest in credit spreads expanding dramatically and so.
As a hedge against the potential for into bank liquidity constraints, having lived through the last crisis.
We did decide to draw the revolver on March 12, as I said, we have since repaid the revolver in full and so our existing balance today on the revolver zero horse, we have still the term loan outstanding for $38 million in so we have a net cash position as you know.
The same that cash position essentially we had at the end of March.
And of course, we can say to generate cash and so we do intend to opportunistically buy back stock we intend to pursue external business development is ER as we've done recently on the case to time transaction and we have the flexibility from a balance sheet perspective that we believe is a uh huh.
Real competitive assets.
Thank you Pete and then on the on the Ryanodex for Kogut, where we think it may fit into paradigm of treatment. If we're successful and the patient population that we expect to explore initially I'll turn it over to Adrian for a brief summary.
Thank you so based on our research.
We understand that make it into a bunch on overall younger legs.
MPOG team some well they need a body dues harvest specialty too much changed your life cycle.
Because of Doug.
And do you have easy to probably I know the next to impact the needs of college, you do bidens required to rent the cage and two good we need to come one cents to another.
We can be somebody idle rigs to be an a decent standalone yeah.
As we know these basins required moving to boot bid up you'd be approaches depended on the stage well depending on the underlying conditions.
God.
He said, we own TC basically I know it looks to be an addition to establish and standard of care, which also continues to evolve.
Hopefully that are these in the liana legs and EPS impact in the lifecycle of the by lose a mutual 18, thereby download.
<unk>.
Thank you Adrian.
Brian did that answer your question as well.
Yes, very well thank you very much and congrats it actually is another program.
Thank you.
It does appear we have no further questions I'll return, the Florida Strattera for closing remarks.
Thank you keep well, let me close today by reiterating that 2020 has the potential to be the best year in Eagles history.
In terms of total revenue and gross profit followed by an accelerated period of growth over the next three years.
Hi building on our strong Bendamustine franchise, we remain dedicated to advancing our pipeline programs that are bringing new an important treatments to the public we continue to focus on addressing underserved therapeutic areas growing your company both organically as I stated in three strategic relationships.
And delivering value to our shareholders. So once again. Thank you for your time. This morning, we hope that you and your family's remains saved through these difficult times and we'll speak again shortly thank you again.
And this will conclude today's program. Thanks for your participation you may now disconnect have a great day [laughter].
HM.
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