Q1 2020 Earnings Call
Please stand by we are about to begin.
Ladies and gentlemen, good afternoon on welcome to virtuous first quarter 2020 earnings Conference call. My name is Jim and I will be your operator for today's session.
That's for today's presentation, or the company's chairman and C.E.O., Bob Ferrets and C.F.L. Judy Henry following their remarks, we will open up the <unk> for questions from <unk> institutional analyst as well as investors.
Before we begin to call I would like to provide virtuous safe Harbor statement that includes cautions regarding forward looking statements made during this session.
During this presentation management may just got financial projections information or expectations about the company's products and services or markets or otherwise make statements about the future, which are forward looking and subject to a number of risks and uncertainties that could cause the actual results to defer materially from the statements made.
The company does not undertake any obligation to update them as required by law.
I would like to remind everyone that that's called will be made available for replace via a late in the Investor Relations section on the company's website at Www Dot <unk> Dot com.
Now I would like to turn the call over <unk> Chairman N.C.O., Mr. Bob Farris.
So please proceed.
Good afternoon, everyone and thank you for joining us today.
When we held or last call on March 23rd sheltered place and social distant seen orders had just been issued across the United States.
The impact on businesses and employees has never quite occurred at this level and on this time scale since our country was founded and 17 76.
Everyone has seen their daily routines uprooted.
I know this is an extremely challenging time for many personally and professionally.
I sincerely hope you and your loved ones are healthy and safe and our deepest sympathies go out to anyone within the virtual community who has been adversely affected by co. Good 19.
We view our employees customers shareholders in vendors as all part of their purchase a team and if one of US hurts, we all her.
Due to versus government contracts, which require continue performance. We are in the central business and have continued to operate in a modified format whereby most all staff have been working from home.
We recognize the importance of Berkshire, not only surviving this pandemic, but ensuring we succeed into the future for all of our stakeholders.
Therefore, we have taken any and all prudent measures to secure our future, including applying for government assistance intended for businesses with fewer than 500 employees, who are willing to maintain employment levels. During this time.
I am we used to report that due to the exceptional work of our CFPO, Judy Henry virtue, which suggests notified that are loan application for 1.32 million on or the cares Act has been approved.
Please know that our plan is to fully comply with the law. So that this loan will ultimately be forgiven as we increase our corporate stability during this on certain time.
During our last call. We spent a good deal time discussing why we were optimistic about our ability to continue expanding our reputation as a leader and simulation training and continue supporting the essential needs of our law enforcement and military personnel. Despite the complications that may have arisen from the coby 19 pandemic.
Increase report that How's evidence fire first quarter financial results and operational progress that was indeed, the case three the first quarter of 2020.
As you'll recall, we ended 2019 on a high note with the 9.6 million dollar backlog a strong pipe line of potential new business opportunities and the most expansive in advance product line in our company's history.
Thanks to the adaptability of our team and I was always the hard work out many prior quarters in years, we were able to carry this will met ended the started this year.
During the first quarter and didn't marks 31 2020, despite the onset of a global pandemic, we actually increase our revenues, 9% year over year to 3.3 million.
While the growth in the first quarter was encouraging, especially given the current state of the world. It's worth noting that our first quarter financial results wrong track to be considerably more impressive if not for Kobe 19.
So most of the through most of the first three months of this year, our business was progressing extremely well.
Fortunately, we had several orders that we're set to be delivered and installed in March and a shelter in place became the norm in many states across the country.
For all these orders were suddenly delayed or pushed in subsequent quarters.
Yeah fortunate news in the short term is that these delays negatively impacted our first quarter financial results.
Hey, depress the top line. They also impacted our margins since we've been wrapping up to meet the increasing the man unexpected and 2020 and be on.
The good news is that none of these orders were lost.
They simply shifted into our backlog.
How's up today, we haven't seen orders cancelled due to changes in budgets.
Although this shift is not ideal.
But as those of you who have followed our story or where we have always suggested evaluating the business over a longer time horizon that a single quarter.
Improve sales and marketing efforts plus our finest product line up in our history helped our company accepts a quarter with a record backlog of 11.3 million. Despite the reduce activity forced by covered 19.
We still fully expect to recognize the majority of east revenues over the coming here.
This is based on expectations that the coming months, we're witnessing increase in travel and installations, but we're also prepared endured longer than expected delays.
Of the contracts we've secured so far this year there are two in particular that are worth highlighting.
In March we received our first order through a new distributor in Europe, which is valued at 1.1 million.
The orders for multiple simulators, including B.S.T., pros and accessories, including dropping recoiled kids some threat fire devices.
Although dollar values material this contract carries particular strategic value for us.
And most domestic law enforcement circles approach is already known as the highest quality simulation training on the market.
Surveys completed by our customers are showing our products and our customer service are consistently rated at the highest level and our mind. The primary reasons, we continue to grow.
The distributor that partnered with US is highly regarded a known for being very selective.
In fact, they spent several years betting suppliers have products before choosing to work with us.
Their decision to go with purchase a great stamp of approval that should help us improve our brand within their established territory.
We have over $1 million in order so far through this distributor.
Hopeful that the opportunities to leverage this channel to expand our presence among European law enforcement and military communities will only grow.
Subsequent to the quarter in we received a new I.D.I.Q. or indefinite delivery indefinite quantity contract print the department of state for the Republic of Mexico.
Just 1.6 million dollar contract Criss crosses our product lines, including driving simulators marksmanship simulators as well as use of force simulators.
Dropping recall kissed and accessories.
Extra set to be delivered to numerous state police agencies and correction facilities throughout Mexico.
It's also highly encouraging for us to see such a material follow aren't order for our newest product line driving simulators.
As a reminder, we launched this product just a year ago. The first order, which we received in March of last year was similar to this latest one.
It was for 11 driving simulators through the department of state for the Republic in Mexico.
All of these have since been successfully delivered and installed.
To see our first customer come back for more virtuous state of the yard driving simulator speaks louder than anything I might say.
However.
Perhaps what's most significant about this contract is it validate the optimism we expressing our last call and which continues despite covert 19.
This contract was awarded in early April at a time when it certainly was rabbit.
And both supply and demand installed in many industries.
Clearly this hasn't been the case for virtue.
Even with the current travel restrictions, we fully expect to deliver install disorder, and therefore recognize revenues and 2020.
To be fair, we faced our own challenges with Kobe 19.
This contract hopefully helps demonstrate why we continue to believe that demand for simulation training that saves lives and saves money is robust and why we are optimistic about our ability to continue supplying the essential needs a first responders regardless of the macro environment.
I'll add to this theme and a few moments, but first I'm going to turn the call over to Judy to walk you through the financial results for the first quarter Judy.
Thank you Bob and good afternoon, everyone.
Our total revenues for the first quarter of 2020 was 3.3 million.
This was a nine per cent increase from the 3.1 million of revenue we recognized in Q1 of 2019.
The increase in recognized revenue for the three months ended March 31, 2020 resulted from an increasing the number of simulators industries completed indulge bird compared to the same period in 2019.
Gross profit for the first quarter of 2020 was 1.6 million or 47.8% of revenue.
Pair to 1.8 million or 59% of revenue in the first quarter of 2019.
Changing gross profit was primarily due to increased cost of sales in the product mix and the varying quantity of systems accessories and services sold.
Arnett operating expense for the first quarter 2020 decrease 7% to 2.1 million from 2.3 million into one of 2019.
The decreases in that operating expense was due to redo selling general and administrative costs for labor benefits travel and professional services.
Mhm.
Turning to our profitability measures.
Blocks from operations for the first quarter of 2020 was a 512000.
Impaired to a lot from operations at 457000 in Q1 of last year.
For the first quarter of 2020 net loss totaled 389004 or five cents per diluted share.
This compares to net loss of 313000 or four cents per diluted share in Q1 of last year.
Are adjusted even <unk> Noncat financial measure.
326000 in the first quarter of 2020 compared to an adjusted even our loss of 278000 and Q1 last year.
Turning to our bookings in backlog.
<unk> booking says the total of nearly sign contracts and purchase orders received any given time period.
For the three months ended March 31 2020.
See booking totaling 5 million.
We define backlog as the accumulation of bookings from sign contracts and purchase orders that are not started or uncompleted and cannot be recognized as revenue until delivered in the future period.
Backlog also includes extended warranty agreements and step agreement that are deferred revenue.
Recognized on a straight line basis.
Oh for the life of each agreement.
As of March 31, 2020, or backlog was 11.3 million.
Which is up from 9.6 million at December 31, 2019.
Finally to our balance sheet.
A quarter end.
Approximately 3.8 million in cash cash equivalent answer to because of deposit.
Which was up from 3.3 million from the end of the period.
December 31 2019.
Accounts receivable and Unbilled revenue combined total approximately 5.2 million at quarter and compared to 5.9 million at December 31 2019.
Yeah.
From a working capital standpoint, we ended the first quarter 20, 26.7 million and working capital.
7.2 million in working capital at December 31, 2019.
Mhm financially, we believe richer remains in a healthy and strong position.
Given the uncertainty that exists currently in the world.
We opted to take precautionary measures to further strict in our balance sheet.
Subsequent to quarters, and we played for the Paycheck protection program or P.P.P. loan two wells Fargo under the cares to act.
On may 8th.
Received notice that we'd been approved for point 1.3 million P.P.P. loans.
And proceeds were received yesterday.
The details of the P.P.P. promise every note are available in our 10 q.
It is our intention to use these funds to fund payroll costs and for the other permitted expenses and to apply for forgiveness in accordance with the terms of the P.P.P. Lo.
But this additional funding in place.
<unk> isn't a better position to whether the current storm and emerge in a position of street.
For additional details of our financial results, please reference or 10, Q., which was filed earlier today.
That can concludes my prepared remarks on I'll turn it back to pop.
Thanks shooting.
And there's no doubt that many industries have been hit incredibly hard by the pandemic.
Because of the increasing demand we've seen over the past few months, we've been adding staff, an increasing r. and d. efforts to ensure we're prepared to capitalize on the opportunities ahead of us.
We are fully aware of the imperative need, especially now to be conservative with cash and improve liquidity.
In many instances well, we've done is reallocated personnel and budgets to ensure their as effective as possible.
For example, we agree purpose some funds from our travel and trade show budget to digital marketing.
We're fortunate to have a highly flexible and adaptive group of employees.
In fact portions of the staff are actually cross train. So they can work on whatever's, most needed which helps us better scale in accordance with changing demand.
However, given the uncertain nature of so much of the macros landscape and our need to preserve our talented and trained staff. We made the prudent decision to pursue additional means of Puerto finer balance sheet as Judy just mentioned.
But the additional financing we secure subsequent to the quarters that we can rest assured knowing we have to means at our disposal to take care of her staffing customers and ensure birtcher continue supplying the necessary training to law enforcement and military personnel should economic conditions deteriorate.
Of course, there's still a great deal of unknowns in the world today.
But other than some customer delays like the ones that occurred at the end of March.
I have to see a declining sales.
Some orders will be taking longer to deliver and install which in turn delays rubbing your recognition.
But the demand in the market doesn't seem to have diminished.
In fact from a new sales perspective April was an incredibly productive month for us.
We've obviously no more as we progress through 2020, but even after stay at home became the norm for many we were continuing to land material contracts like the I.D.I.Q. contract I mentioned for the Republican Mexico.
For the time being.
Continuing to push ahead in pursuit of our long term objectives.
We continue to add to be back that training curriculum to help law enforcement communicate and interact more effectively and positively with individuals with autism.
We're still working to enhance our products sweet by refining current solutions and developing new ones.
And we continue to make progress to better position or products to suit the needs of the military market.
[noise] during the stay at home order our teams to show tenacity first because success by actually increasing our progress our progress on product developments for the military market.
Similar to the law enforcement market. The military does not appear to have substantially altered its appetite for new training solutions.
We continue to make progress here and hopefully we're have some good news to share in the coming quarters.
At this stage no one can say with certainty what the world will look like as policies change and we all work to return to what we previously called normal.
But regardless.
Based on the most recent of events purchased future seems stable and bright.
We're fortunate that approximately 87 per cent of our customer base is government and essential to the wellbeing of all of us.
Such there's relatively little risk at the moment of customers encountering challenges with cash flow or become insolvent.
Mini departments already had budget allocated for the year.
So spending behavior was not materially diminished so far.
Of course, it is possible that customer behavior could change later this year or in 2021, and we plan to carefully monitor and quick we adjust.
Should the return to normal take longer than current projections were should economic conditions remain challenging it is important to bear in mind that purchase it is a remarkably stable company with a clean balance sheet that we've just strengthened and a history of successfully navigating challenging economic environments.
We emerge from the last recession stronger than we entered it.
We've added to our cash position since the end of last year.
We currently have 3.8 million in cash.
[noise], we've taken cautionary measures to ensure we other resources in place to take care of our people shouldn't need a rice.
And we have a long history, keeping an extremely queen balance sheet.
We know how to conservatively and effectively run our business during times of prosperity and scarcity.
So overall, we remain confident in our ability to whether the current storm and emerge in a strong position.
Properly trained law enforcement and military personnel as in every once interesting specially during periods of unusual tension.
We intend to be here to ensure our critical first responders have access to the best simulation training possible.
Mhm.
And with that I'm going to wrap up my prepared remarks, and I believe we're ready to open the call for your questions. Operator, please provide the appropriate instructions.
Mr Fair I send move Henry Thank you for your remarks today and to our audience. Joining if you would like to ask her life question over your telephone line simply press star and one on your telephone keypad pressing storing mando place your line into a cue and we will take your questions. One at a time a friendly reminder, that if you're joining us today on a speaker phone. Please return to your hands that to be sure the church.
<unk> is the best provided.
What's a good like the gentleman that is a star and one if you do have a question. Our first question today comes from the line of Jason Schmidt at Lake Street. Please go ahead Jason.
Yeah, I think to take my questions. Just curious if you could qualify how much revenue was pushed out at Q1 into a into a a kind of cute you in q. sorry.
Mhm.
We we've not quantified that I.
But as a general number it exceeded $1 million.
Okay. That's helpful.
And then but by no you mentioned some of the attraction, you're saying specifically with the I.D.I.Q.
Order in April, but curious if you could expand on that and just talk about some of the order patterns that you saw on a per all that bad now here in the first part of May.
Yeah. Thanks, Thanks for the question, Jason we've we've not noticed a shift and the border patterns like I mentioned, we have seen it some modifications on the delivery side and that is I'm known exactly how that will work in the future.
If that was well be.
The linear too stay at home orders easing up or if if there's gonna be additional conservative approaches from customers. We have had a couple of customers that sad that are actually more aggressive and want a installation, even though we are more costs.
Right, now, which obviously air travel.
So I think there could be a bit of a spectrum, where some customers will be a bit more aggressive and others will be more conservative but on the the order.
<unk> I think the combination of having a larger product next to this year than we've had in previous years, having a an enhanced reputation. This year after doing a lot of hard work in previous years in decades, I think all of that is really benefiting.
That's right now so I think it's a it's a result of a lot of our website updates and our digital marketing capabilities has has made us a better choice. During this time of a state stayed home orders.
Okay appreciate that a color and the last one for me and I'll jump back in to you. It sounds like you're not seeing it to day, but given the potential for <unk> constrained by good in the future I you see any push back from customers for about pricing standpoint.
Thanks, Jason.
Not any different than we've seen in the past so I I, we all we use.
Have the potential to encounter people that are very price sensitive we do our best to explain that sometimes you get what you pay for and you know department that has selected the lowest cost simulation provider that may have though the weakest training potential in life and death.
<unk> is not a great position to be in and actually can be counterproductive.
We think we are in a in in an area where effective training can many times when the argument over the lowest cost provider and we certainly work hard to explain that so and we we also for those who do you want quality training. We also have.
This step program the subscription arrangements so that they don't have to put a large amount of money up front can pay a small amount of money over just 12 month period and have access to the world's best training. So we have a lot of options for those that have some budgetary constraints and I think that you're seeing.
The world with with Cove, it in that concerns of.
Potential budget construction that are step program is even more relevant and we're extremely pleased that we introduce that about a year ago and that we've refined not to have that program program could really pay dividends to get great training into more more people's hands with.
Kobe 19 situation.
Okay. Thanks, guys.
Thank you.
Thank you are next question will come from the line of Alan <unk> National Securities.
Okay. Good afternoon.
Did you provide an update on how you're thinking about your strategy to break into the military market.
Mhm.
[noise]. Thank you Alan Thanks for for being on the call and asking that question. So that our our our strategy really as focused on having the right product that that meets the military needs and and so in some cases that is mean some adjustments to our preexists.
Justine products, and and and then making sure we get in front of the right people and so that's really been a big focus of ours is is have the right product and get in front of the right people and we continue to to make headway on that <unk> on that plan.
To eventually end up with more and more military units using Berkshire and eventually virtually becoming a standard in the military like we have done in law enforcement.
Oh. Thank you and then do you spoke about the European distributor, but yeah true when can you provide a little more color on.
On in terms of kind of where there what the opportunity and focuses that they have.
Sure so the the the focus.
Is really on on penetrating the European market with virtually technology and I I think there's areas in Europe that groups don't haven't even heard of approach or only know a simulation is technology. That's 15 20 years old.
And stale and so having a reputable agents a group like the distributor in Europe that has contacts and is able to introduce birch.
Areas that we would not be able to get into with our own sales staff and and that we are not is not as accustomed to the culture over there or not.
Many times don't speak the language that having a having a foreign distributor assist us in the international realm, particularly in Europe is is very helpful. So it's the beginning it was a great initial order we were happy to see that that's an excellent way to get started.
Reminds me quite a bit of how we got started in Mexico, which was are actually our very first international installation and the distributor there was strong enough to place in order and get product ended the market right away and be able to show it in demonstrate it and then was in extremely successful.
At doing that so.
We're looking forward to the the group in Europe, and doing something similar but yeah. It's it's one of those things that it grows over time and it's you don't see the results of that in the first month or the first year, but it can be incredibly lucrative and and it can increase.
Footprint of our training, we're really hoping to train those in Europe at the same level that we've been able to train people in in the U.S. and other countries.
Yeah.
Thank you can you talk about the factors that affect the gross margin in the corridor and kind of is there a good range to kind of think about where that could run in.
In 2020.
Yes, Sir Alan's so so.
A couple of factors on gross margin the biggest one being to that we one of the factors in cost of goods sold is the staffing level, we had increase our staffing level to prepare for the sales pipeline that we saw kamin and so first quarter.
Included a bit staffing costs of goods sold that we had had previous year, but it was intended to be there. So that we would make sure and fulfill orders for customers and when Kobe 19, head and we actually ended up not.
Being able to to ship and install as much as we were hoping in first quarter.
And as we looked at the the terrorist act and and our own internal need of deciding that we wanted to keep our staff employed even if we weren't going to be able to go do installations that ended up creating a higher cost item.
And then costs of goods sold for the payroll piece, which created a lower gross margin for that quarter because of that combination going forward to the second part of your question as far as a a range for gross margin.
As you know our historic gross margin is right around 60% and and we've been able to on average <unk> keep about 60 per cent gross margin that that can and does fluctuate. We we remain hopeful that we are able to maintain 60 per cent growth.
Origin into the future and of course that can be impacted they've various ways, either either potentially more brush margin or or potentially last depending on a lot of factors, but definitely we can speak to the factors involved and the numbers that we just reported the first quarter numbers we can.
Speak to that and and that was a situation Ah staffing up in our production installation area and then not being able to fully you are wise that staff I do to Kobe 19, we believe that's hopefully a temporary thing and that people will be getting back to work in the coming weeks and months.
Oh. Thank you and then my last question is she's expand that you're offering. So now you have driver's simulation and a lot more different scenarios can you help us understand kind of.
In terms of your sales do you think that.
<unk> a lot of the opportunity is expanding with existing clients. So we're we're more targeting new new clients and and new opportunities.
Oh, that's that's a great question so I.
<unk>.
Dancer it properly I'd have to say, both obviously, we've had success and keeping and growing with current customers as as <unk> as you can see from our previous press releases, having orders I follow orders from groups like the yeah.
Customs and border protection in the secret service U.S. Marshalls, we've had a lot of federal that that really a wonderful federal clients, who have not just bought from Virginia, but then continue to buy from Berkshire. What are the most recent is let's see which is the federal law enforcement training Center.
And and they've been a great customer. So so there is a lot of opportunity in growth within and you're right. There is when you already have a client.
And they decide hey, they want to add a driving simulation and they already are happy with your firearm or your judgmental use of force training training system. There is opportunity that they would want to stay with the same vendor and then add add in driving simulation. However, I also should underscore <unk> has not.
Penetrated the F.B.I., we have not penetrated yeah, U.S. army, yet to a large extent or the U.S. Marines to a large extent.
There's a certain countries that we don't have large install base is that.
Britain, and no, Spain, and France, and the the less goes on so while.
Well I believe we're in 33 countries International currently there's still a lot of room to grow.
I would I think most people would say, though that Berkshire has a enormous room to grow in the military market. Even know special forces in different groups have have been attracted to our products for many years in it as successfully use them for for multiple years, they're still there's still several opportunity.
Cities out there on the military side that we have have not succeeded at so we have not succeeded in securing the projects without something we're working on and we think a lot of our products would actually be superior to some of their products that that a a used in the past, but there's a whole process of.
Proving that and I'm getting in front of the right people and insuring that the products rock rain fit their neat, but definitely there's a lot of upside opportunity. We have the nowhere in in no way you have we saturated markets on any of the products that we offer.
That's great. Thank you so much.
Thank you.
Thank you for your question I'd like to take just another moment to encourage our phone audience depressed star in one if you do have a question or any clarification on anything covered in today's session that is star in one ladies and gentlemen, next we'll hear from Richard Baldry at Roth capital.
Thanks, with the backlog to record Love I'm, sorry, curious once travel and restrictions opened up a little bit you talk about how much bandwidth you have 10, what the timing would look like to sort of clear that how much yeah could you play catch up in a short period of time are are there bandwidth constraints that would.
Sort of spread that out by necessity.
Yeah. Thank thank you. Thank you richer for that question. So that's that's the silver lining from what I mentioned earlier on how we had increased out for costs of goods sold sold for the <unk> installers that the silver lining is is that we are.
We are ready and Reverend to go to install systems should the the customer start to allow us and we are still doing some installs I need to be clear if it's a location we can drive too. So it's if it's a place that we can out proper social distance scene.
And if the client is okay with it and if we are okay with it we still will do some we are still actually doing some installs even during this time only when we feel it's it's it has ample safety for our staff and for our customer, but you're right once things start to go back to normal.
We believe we have banned we have some some pretty good bandwidth to be able to get installations done quickly and effectively.
And keep me talk a little bit about the sale cycle now it's sort of changing any early feedback from the digital marketing what checks to Miss front of the final how deep you feel you can go into the sales final toward closing stage in a virtual manner.
And Ain't challenges inside that final.
Yeah, Great Great question I I think the the real challenge there for US is is that we we just don't know some the answer to some of these questions and I frankly, nobody quite knows because this this kobe 19 world as as <unk>.
Like anything we've we've encountered before it seems like.
Our sales pipeline is progressing well that our digital marketing strategy that we set up is working as we had hoped and you're right are we do have a longer sales cycle. So we are monitoring in front of the front of the final we're monitoring the back of the final so far it's.
Working good, but we reserve judgement until we have a little bit more time in and experience in this in this world if things start to go back to normal where for example, let's say a customer likes digital marketing, but really has decided they wanted to personal demonstrate.
<unk>, which by the way we highly encourage anyone interested in this type of equipment should do personal demonstration don't.
Don't Trust a company to say they have 800, great scenarios, you actually do the training experience. The the system do the scenarios for yourself, that's really where <unk> is able to shine because it shows the clear differences between check the box training and and versus train.
And in our opinion.
So.
There is a chance that when if things go back to normal and.
<unk> are allowed to travel to our facility to get a get hands on our equipment that that will help our clothes rate and but right. Now I think we're we have someone that I'm in some some window or back because of our reputation a lot of those agencies I mentioned customs and border protection U.S. Marshal.
<unk> Secret service slots C.D.'s are these are real <unk>. These are really thought leaders in many regards and the fact that they've all selected <unk> is very reassuring a lot of other agencies that are working for the best solution. So so that helps us.
Maybe because we're the the leader in this part of the market it might help us more than others, but we really really enjoy competing head to head and showing our product in features.
Directly against <unk>, competing products and and there's many times a world of difference.
Hi, Thanks.
Thank you.
And Mr. Ferris at this time, we have no further signals from our audience survival turn it back to you for any additional are closing remarks that you may have.
Alright, thank you so much.
And thank you.
Before we close I'd like to point out that it is national police weak in the U.S.
It's especially important given the circumstances this year I.
I'd like to extend our sincere thanks to the brave men and women, who are putting their own safety at risk every day to help ensure our communities are safe.
It's an incredible privilege to have a courier, that's <unk> those who serve us.
And at the end of the day, it's what keeps us never satisfied and always pushing forward to create an even more effective simulation training product and a growing business to benefit us all.
We look forward to updating you on our next call in the meantime be safe take care and God bless.
[noise], ladies and gentlemen. This doesn't include today's teleconferencing, we do thank you all for your participation you might now disconnect reminds me hope that you enjoy the rest of your date.
<unk>.
Okay.
Mmm.
[music].
Oh.
[music].