Q2 2020 Emera Inc Earnings Call
Sure for standing by welcome to the American Futures Twentytwenty analyst.
At this time all participants are in listen only mode. After the speakers presentation. There will be good question and answer session.
At that time, if you have your question. Please press star one on your telephone keypad.
Please be advised today's conference is being recorded today Wednesday August 12, 2020 at 930 Fivek time.
I would not likes to have the conference over to your speaker today Scarface things numbers senior director of capital markets. Please go ahead.
Thank you Chris. Thank you all for joining US This morning for America second quarter, 2020 conference call and life.
American second quarter earnings release was distributed this morning, Yeah, newswire any financial statements discussion and analysis.
Sure being referenced on this call.
On our website <unk> dot com.
Joining me for this morning's call or Scott Gulf War, Ameris, President and Chief Executive Officer, right blend in Americas, Chief Financial Officer, and other members on the University.
[noise] RV good.
Before we begin I'll take a moment to advise you that this morning's discussion will include forward looking information, which is subject to the cautionary statements contained on its slot.
Today's discussion and presentation will also include references to non-GAAP financial measure.
You should refer to the appendage for definition information and reconciliations historical non-GAAP measures to the closest GAAP financial measure.
Now I'll turn things over to Scott.
Thank you Scott and good morning, everyone.
That's the global coping 19 pandemic continues our team remains focused on safely delivering the central energy or customers are relying on and all of our service areas.
The reach of infection of the virus in the communities we serve have varied significantly.
For example in Atlantic, Canada, we experienced very little community spread coping 19 and in parts of the Caribbean in New Mexico spread has also been relatively contained.
It is much different situation in the state of Florida, where they're facing much higher spread and infection rates.
However, no matter, where we operate our number one priority is the health and safety ever team, our customers and our communities.
Our teams have adopted in every jurisdiction to new procedures and protocols to continue to deliver despite the impact from challenges a couple of 90.
Well, we have never stopped working many of our employees have been productively operating from home since mid March.
It's public health officials lift restrictions, we've been focused on a responsible reentry plans to phase or employees safely back to the attrition workplaces [noise].
Our reentry will be measured and will be reflective of the reach of transmission and public health guidelines and each of our service territories.
We understand the pandemic continues to drive financial pressure in our customers and her local communities.
From the beginning or utilities have been working with customers on relief initiatives and donating to organizations to help the vulnerable inner communities.
In addition to corporate donations our employees recently mobilize to supports keeping snare communities and to assist local organizations and businesses illustrating the compassion and community spirit of our employees above and beyond their unwavering commitment to delivering for customers during his tenure.
I've shared with 13 many times in response to this pandemic, it's more like a marathon kind of sprint.
They've continued to adapt and deliver for customers in our community sort of return.
I'm proud of them and grateful for their contributions to mirror strength and resiliency.
As expected well the Coke 19, condemn a can of course had many impacts our business is nonetheless, continuing to perform very well.
We're generally experiencing lower commercial and industrial sales because of the economic impacts if a pandemic.
This is partially offset by increased sales to residential customers, where the contribution to recovery a fixed costs are structurally higher.
We expect this trend to continue throughout 2020, as we continue to manage the impacts of the pandemic.
Our balance sheet has also been strengthened.
With benefit of the proceeds from the sale of it may remain.
And it's Greg will discuss in a moment or businesses have been able to grow cash flow from operations on a year to date basis.
These actions combined with our reaffirmed credit ratings from Moody's and Fitch reflect are strong and stable financial position.
[laughter] with additional health and safety procedures in place Ameris capital program continues to advance and it's a reported on our first quarter call. We're pleased that are major projects are continuing without any significant supply disruptions or delays.
This includes both the Big Bend modernization project and the solar developments in Florida.
We expect to continuing to fully deliver on our capital program.
We remain confident and our long term value proposition to shareholders, which is supported by the strength in resiliency of our strategy.
Her team.
Across the business or teams continue to work with regulatory agencies to ensure customer affordability reliable service and maintaining financially healthy utilities.
This includes a number of important regulatory filings enter service territories.
[noise] joint the pandemic our teams have been working with regulators to advance these filings without any major delays.
This includes rate cases, it in Mexico gas and peoples gas.
He's regulatory actions are important for the business and we're pleased with the progress to date.
In addition, just this week the Florida Public Service Commission approved tap electric stipulation agreement related to the storm protection plan, which allows for the implementation of this Clos starting January 1st 2021.
Lastly, both peoples gas into Mexico gas have filed for regulatory relief related to the deferral of Copel related financial impacts, including increased bad debt expense.
The new Mexico regulator approved this filing in the second quarter and the peoples gas filing is expected to be reviewed by the Florida Public Service Commission and the third quarter.
As of the end of Q2 2020, no covert 19 related deferral accounts have been recorded.
The impact to cope with 19 had been devastating to many communities economies industries and individuals around the world.
And it's clear that is far from over.
Well, we have employees with tested positive I'm relieved to say that we've had very little work, great workplace spread and our employees that have been impacted are doing well.
We also feel fortunate to that we have such a strong portfolio of businesses the continued to benefit from diversification.
Although some of her utilities have experienced larger corporate 19 impacts and others over all the pandemic has not had a material financial impact to date.
We know there are more challenges ahead governments look towards economic recovery and we remain committed to doing our part not only in continuing to provide the cleaner affordable and reliable energy or customers and communities rely on.
But to help with community support and the economic research in Oliver jurisdictions.
And with that I'll turn it over to Greg to take you through our financial results for the quarter.
Thank you Scott it. Thank you all for joining us this morning.
Our portfolio regulated utilities have remained strong and performed very well delivering adjusted earnings growth of 4% for the year to date, despite dealing with the impacts of the pandemic.
We're pleased with result, primarily driven by strong earnings from capital light.
Our regulated utilities earned premium jurisdictions with supportive regulatory relationships and America continues to see attorneys quality improved.
Now, let's get into the details both result.
Earlier today, we reported second quarter adjusted earnings of $118 million and adjusted earnings per share 48 cents.
The six month year to date adjusted earnings were $311 million and adjusted earnings per share was $1.27.
Merits adjusted earnings per share increase for the quarter and year to date when normalized for the impact of asset sale and the timing difference relates to the declaration of preferred dividends.
These increases were driven by favorable result, elector, partially offset by reduced journey that especially power and amerigas and Caribbean utilities.
With the sale of young regulated gas plant that America me, we expect there to be a fluctuation or results through the last earnings contribution from these businesses.
Hi, normalizing the earnings contribution from asset sale more transparency on performance over ongoing businesses.
For the second quarter 2019 results when normalized for the sale humor me what had been 49 cents.
And for year to date 2090 reported adjusted earnings per share was $1.49, which included 22 cents from assets and subsequently sold. These assets include the unregulated got plant the mirror me and the sale in Florida property.
Therefore, the normalized earnings per share for the year to date 20, Nike would've been $1.27.
Gross from the normalized Q2 20 liking base of 49 cents was largely driven by the strong performance of tangible effort.
During the quarter Tampa Electric feature we did $146 million of earning an increase of 21 million over the second quarter 20 Nike.
For electric growth was driven by increased sales of residential customers higher if you do see earnings from the Big Bend modernization in solar project.
Lower operating expenses and lower depreciation and amortization expenses resulted in a regulatory settlement.
Second quarter earnings from America Energy's marketing training business contributed approximately five cents more earnings per share than in Q2 2019.
This increase was due to lower fixed commitments for gas transportation storage assets more favorable market conditions, specifically increased volatility as compared to Q2 2019.
Mirrors other utilities experienced lower earnings for the core.
Turning to the gain utilities segment were lower than Q2 2019 to the impacts of Cobiz Nike not sales volume increased income taxes, and higher storm costs, partially offset by the timing of a regulatory deferral.
In the Caribbean earnings were negatively impacted by Colgate 19 in the ongoing impact of Hurricane Doreen Graham on the power company.
The gas utilities and infrastructure segment experienced lower earnings in Q2, 2020 as compared to same period in 2019.
Second quarter point Nike included a regulatory decision in new Mexico that contributed five cents, yes and was onetime in nature.
Excluding this regulatory adjusting the gas ldcs were basically flat quarter over quarter.
So on a normalized basis amir's earnings per share for the second quarter 2020.
Three cents versus 49 cents in 20, Nike Inc. Q2, representing a growth rate of 8%.
Lastly for the quarter there was a change the timing of the declaration of preferred share dividends in Q2, 2020, causing a five cents impact in the quarter.
In 2019. This amount was recorded in Q3 and this essentially your timing difference and there'll be no impact on the annual amount preferred dividends paid.
Similar to the quarter year to date growth in the normalized 2019 base at $1.27 was largely driven by strong performances Campbell effort.
For the year to date 2020, Tampa electric contributed $225 million of earning an increase of $39 million over year to date 20 Nike.
Gain kept electric truth is largely driven by higher based revenues related to favorable weather in Q1, higher ABDC lower operating costs customer growth and a lower depreciation and amortization expense as a result of the regulatory settlement.
There's other utilities experienced lower earnings for the year to date 2020, mainly because of the same drivers I mentioned earlier for the quarter, including the regulatory decision in new Mexico.
So on a normalized basis Amir's 2020 years GPS was up marginally Institute, our dollarsthirty as compared to $1.27 from 20 Nike.
And as I previously mentioned the time to the preferred share dividend Declaration cuts I said timing difference that will reverse in Q3.
And finally, a mere main contribution to the mirror EPS in Q1 2020 has been highlighted for transparency purposes.
Moving to adjusted EBITDA and cash flow your EBITDA earnings before interest taxes, depreciation and amortization was lower decreasing by 63 million were 5%.
Most of this decline was related to the sale the gas plants in the mirror me.
Operating cash flow for year to date, 2020 was up $41 million or 5% compared to 2019.
This growth was led by carefully electric which experienced an increase of 77 million or 18%. This increase in regulated caseloads is a further signal the marriage, improving cash flow quality, which is a priority for our team.
In closing the quality and diversification of the mirrors portfolio produced strong results for Q2 2020, despite dealing with the impact of Cobot 19.
Our businesses continued to be resilient and are committed to both the safety of our employees and customers as we work through the pandemic.
Our strong year to date operating cash flows and available liquidity at the company well position for possible future Cobiz Nike related challenges to the business.
Our major capital projects continue to progress without any significant disruptions in our on time enough budget, including the Big Bend modernization solar projects in Tampa.
And lastly, the regulatory teams across our businesses are advancing important initiatives, including rate cases that are gas ldcs in Florida, and new Mexico.
Our business is strong and well positioned for future growth.
And with that I'll turn the presentation back over to Scott.
Thank you Greg.
Concludes the presentation and we'd now like to open the call for questions from analysts.
We'll now open the call for questions. If you have a question. Please pick up your received a press star one on your telephone keypad again that is star one.
Please hold what we can files acuity roster.
And your first question comes from Ben Pham of BMO. Your line is open.
Okay. Thanks, good morning.
On that first questions on orbit 19, and I know you mentioned the impact.
Material.
To date, you're not.
Upton deferral accounts and and whatnot, but can you provide a sense of.
Any sort of quantification or direction pack that you experienced is it a couple knowing here in their needs it segment.
Or is it something off any any context would be appreciated.
Yeah, Ben It's Greg I, you know I I think probably be.
He just way or the way that we think about is probably kind of in three buckets. So from an operating cost perspective incremental pp any those types of things. We've really it's it's really been for the most part probably offset by savings that we're experiencing because of the work environment. We're in right now so so effectively.
No impact at all obviously, we've seen some load impacts if I think of the second category across our businesses, some a little bit more higher than others.
But then in some cases more than offset by weather or a mix of sales by customer class, where some customer classes, obviously contribute more to fixed costs than others.
And third is bad debt expense and I think it's too early to tell where that will end up obviously like everybody else. We're anticipating that we will have an increase bad debt expense this year.
Across the business it would be single digits millions of dollars that we would anticipate at this point in time.
Uh huh.
You mentioned a couple of.
Great.
Cases that are ongoing and everything.
On track on.
My question Mars.
Beyond that that bonds, we have what what's the plan around.
Hi, electric in terms of filings and can you remind us what Nova Scotia power.
When do you have to address or what they regularly now your thoughts around caucus terrorists or just any sort of expansion today everybody agreement.
So soon after you want to start with the with temp Electric and then and then Rick you can you can respond for no square.
Sure, Yes, that's true, but I didn't quite catch the the to.
Sounds reasonable muffled on my end I apologize.
Maybe I'll just if you.
[noise] clarify the temple electric piece that would be appreciated.
Yeah, not a problem.
My question was was really the timing on the next.
Rate case, that's if thats the plan.
Okay, sorry, yeah, so it and intensive.
Regulatory filings generally thing has been moving along quite well in the state.
You know we had the approval of the SPP on Monday, which was great. We've had other settlements another agreements until the business of the Florida pub Public Service Commission is continuing on really without disruption you know in terms of next rate case, we would anticipate you know we were.
We're going to stay until 2021, we can't have been rates before 2022, we've been doing a lot of building as you know and so we would anticipate going in as soon as we can to getting rate for all the capital we put in place.
As Ben it's Rick Jamaica, with no, especially power so.
Nova Scotia is operating under.
Another.
Great stability plan that was negotiated with customers and a regulator. So that will cover so till 2022 as well the intention it would be to work with a customer support for other opportunities to continue those types of.
Creative approaches to.
Managing rate.
Knowing that we're heading into investments.
That are aimed at increasing renewable content and looking at that the future state coal generation in Nova Scotia, that'll probably be the biggest driver to what we're doing next time.
Great and filings for a general rate application, Nova Scotia, So nothing in the imminent.
Term and we'll be able to keep you updated as things progress, but quite stable on that and if it seems I know search.
Okay. So it sounds like Rick that that by now and I haven't decided is more that customer service mechanisms I'd take the existing one containing inflation versus more full blown cost of service application.
Yeah, we got and pending we do we do look at.
At rates and potential for GRA, but but we do that review on a regular basis as part of our ongoing financial management, both for rate classes to make shorten their balance between the customer classes and for.
For the recoveries, but right now things are in pretty good statins, and we'll monitor that we usually do that with lots of lead time for the regulator to be able to prepare for filing dates and so on but there's nothing in the works right now for that but we that's a regular part of our business to be assessment.
And and bring that planning Fort worth.
With that six to 12 months advance notice of.
Type of work that's required to get geared up with the regulator to customers.
All right that's great. Thanks, everybody.
Makes sense.
Your next question comes from Mark Jersey of CNBC capital markets. Your line is over.
Yeah. Thanks, good morning around.
No obviously with the potential of a change in administration. The U.S. chatter about reversal corporate tax rate Craig is there any thoughts that maybe pause on on the reduction of holding company debt or earthquake and she plays out over the next six months.
Yes, Mark it's a good question and clearly one that's coming up more often and I don't have any better crystal ball as to what's going to happen in the U.S. and they anybody else and of course, there wouldn't be a process that any new administration would have to go through.
I think we'll clearly get some increased visibility on that over the next six months, but so we're going to continue on the path that we're on.
And then reduction of holding company debt and reevaluated circumstances change.
Okay, and then can you just walk us through the lower depreciation amortization that temp electric and that I.
I guess, an intangible software asset adjustment just whether it's had a onetime in nature and how that plays through in the back half of your as well I think there's still another eight minds is being recognized.
Yeah, Yeah, it was yet but in all regulatory environments, you find yourself periodically in situations, where some of your specific assets because of the pool depreciation methodology I get over depreciated.
Common and it was something that we're working through in Tampa.
I got resolution to take that excess appreciation that we had on our books and and bringing in income this year and so you're right. So it was $16 million settlement half of which was booked in Q2 and the rest will this flow through the balance of the year.
On a quarterly basis.
Okay.
And then just one other question just following up on something Thats, not an issue, but in terms of the aging receivables is there certain areas that.
We're seeing more of that or something we should be mindful of in terms of geographic.
Concentration.
Oh, that's that's a good question I I don't think so it's it's.
We made a deliberate decision not to disconnect people for for non payment or were delayed payments in the.
In the current environment and we'll we'll start to move away from that as we get into Q3 and economies open up.
So as a result of that not surprisingly.
Maybe little bit more on the residential side, you're seeing that customers are have been a little bit slower to pay.
Hello, but also gets clouded by caught caused by seasonality. So in Nova Scotia of course, we're at a period of time now where bills are lower than they normally would be and so we're not seeing as much of an impact percentage wise may be seen.
In fact, but not as much on the dollar side.
So it's kind of mixed across mark, but I wouldn't say that theres, one, particularly area that that that is more concerning than another and as we've started to do an outreach and let people know about the plants towards the end of the year, there's been a tremendous response from customers.
Looking for payment plans are starting to disrupt their accounts. So so we're optimistic that there will be some kind of incremental that bad debt expense this year, but fortunately weren't industry, where we're starting from a really really low point to begin with.
Right. Okay. That's it for me thanks.
Thanks Mark.
Your next question comes from Robert Kwan of RBC capital markets. Your line is open.
Great Good morning.
I can you please come back to.
Acts and potentially U.S. election outcomes.
More so related to your disclosure back in 2018, you highlighted.
Tax reform, what's going to have a 3% to 5% negative EPS impact and some of the range of $50 million to $200 million negative cash one time before mitigation.
Just wondering.
It's actually played out and if you can maybe just talk about now like you took a while for new Mexico to come through what's actually going out.
In the current period relative to the original guidance.
Well I'll give it.
Provided somewhat directional I'd say it it's probably been kind of in the midpoint of those ranges Robert I mean, we had a pretty good sense, because it's a somewhat of a mathematical exercise.
In terms of what the yes impact would be as a result of.
The after tax cost for us that obviously became higher with with the 2017 tax reform. So so the wasn't too much complicated but that from a cash flow perspective.
We had a reasonable.
View on what the refund to customers would be a tap electric and we now work through the other states.
That transpired so.
I think upon reflection I I would expect that we're probably in around the midpoint of that range that we provided.
Got it and that midpoint that includes.
M.T. credits that were going to flow through and.
Lead that also included anything in cross border structures is that correct.
Correct.
[noise] I can just finished and with the PGS rate filings.
Outside of normal rate base growth is any z. I think it was 62 million U.S.
That you're looking for in terms of an increase revenue requirement is any of that for anticipated costs that you're not.
Currently concurring or is this really.
If you back into the RMB range.
Let me make I get to GE to help with that TJ.
Sure. So that 62 million includes to get us back within the range, but also anticipated.
Additional costs.
To maintain and operate the system and 2021.
Okay do you have a sense as to how much increased cost of that you're not incurring right now is kind of built into that.
Yes.
So I don't have that in front of me.
A lot of it is to really a lot of our rate cases is due to.
Investment that we're making in the system will.
Return of that investment in the return on that investment management on the rate base side, that's the bulk of it.
And just I'm just to be clear the 62 million kids nets.
Other items that are moving just within writers.
That's correct, we're moving around $20 million from.
One of the riders into for caster, and a bare steel replacement into base rates.
Great. Thank you very much.
[noise] thank our.
Yes.
Just to add on to that sorry, Scott Scott again, I think it's to do something like a billion billion six something like that of Everyplace investment that has been made and it's still in the process of being made.
In in peoples gas system to respond to system expansion in asset integrity investments and those kinds of things since the last ratings and so and it's really it's it's almost substantially all that that that capital investments in.
In the system.
To to deal with that.
That growth that is really driving me revenue requirement.
Yes, that's correct.
Your next question comes from Rob Hope of Scotiabank. Your line is open.
Good morning, everyone won a follow up on one of the U.S. tax reform questions. As we look out to your rate filing schedule. You know could we see you pause planning something like a tico right application in 2021 just to see.
If there is a change in tax legislation as well to see ft. A regulator Oh look at it on a standalone basis were like or if it will have to be addressed in the Gerry.
Yeah, we.
Right right I mean, we haven't made those decisions yet I mean, clearly the first step of the.
Your hypothesis would be an election result in November which will obviously take place well in advance of US Finally, and then we'll be subsequent to that obviously I think most people on the call are referring to a potential.
Center by being successful and leading partial reversal of the 2017 textured for I think we'll have lots of visibility around that in terms of what we successfully election, what theyre likely path is a as well as the timing of that I think we'll have all of those data points before we act.
The file anything in Tampa electric so obviously that will be taken into consideration at that time.
All right appreciate that and then just secondly, you know just given you know governments potentially looking to stimulus measures could we see or are you enter facing with some government what the potential to Ah Ah help or with some infrastructure investment in your various geographies.
I think I think.
<unk>, Rob you know, we continue to to invest in the business and drives.
Investment in system and upgrades and the like in the way that we normally have of course there.
Stimulus package.
It is that a good or fit that can help too.
Helped to reduce the cost Uh huh.
Our system investment for customers and crusher, we'll be taking advantage of that but to there's nothing. That's currently on the near term radar at the moment that would fit into that category.
Alright, thank you.
Thanks, Rob.
[noise] and your final question today comes from Linda Ezergailis of TD Securities. Your line is open.
Thank you.
I realize there's a lot of moving parts on a number of fronts, but I'm wondering if you could help us understand your.
A recent thoughts on a your funding plans for the next year kind of the plan, he and I might change that overtime or might there be some incremental asset sales. How are you looking at the relative attractiveness of area. So funding options on the equity side et cetera.
Well I'll start with the first part of the question limited insights can jump in so.
So nothing has changed from our funding claim that we would have.
Laid out to investors and analysts in February and Tampa.
Renewing down that path.
You know, we're starting to see as you know, we have little bit of room, and our capital structure for some.
For chairs or private equity you know that market looks like it might be starting to open up but again you are relatively modest transaction for us.
Yes, the equity markets have remain constructive for our sector and we're thankful for that equally so maybe more so the debt capital markets have also remains incredibly constructive for our sector.
And so all the assays were just going to continue on our path of our cash flows are despite cobot are really where we expected them to be and at this point haven't really.
Seen anything that would cause us to deviate from our original communication that commitment to investors.
Thank you got it was thrown at it.
So if you want to add anything on asset sales.
No I mean, I think you covered it well, Greg and look you know when we set the we sit on a specific target as it relates to capital rates from from asset sales as part of the funding of the capital plan, that's in front of us today, and which obviously fully.
I've heard that successful on on that doesn't mean that we we won't as always continue to exercise discipline in their allocation of capital and continue to.
Well view that got portfolio from time to time, but as it relates to the funding plan. We Oh, we were successful with their achieving our targets and and so Greg's Greg's answer I think given sort of the full perspective on how we're looking at okay [noise].
Thank you maybe it's just an incremental follow up how might any sort of recent discussions with a debt rating agencies in form a that those plans and can you give us some context around.
Your sense of how the rating agencies are thinking both at an industry level as well to your specific businesses anything that might be shifting or reinforced or even though the passage of time.
Yeah, Linda it's Craig So so let me start with ourselves I mean, obviously since Oh I guess April through to the end of June all three rating agencies have come out with their updated reports on the mirror.
We Scott referenced in the call both Fitch and Moody's game in June reaffirmed our ratings and don't look so I think you can read that they're quite comfortable.
That we're continuing down that path that we had committed to too.
Ah two to follow in and have executed on on the honor plans that were doing.
To see if we go back to April we were.
Disappointed that S&P.
Took us down a notch, but you'll recall they also at the same time broke apart from the group rating methodology and and reaffirmed the ratings that are regulated utilities, which which in the current environment, where it is actually a very constructive thing because we're not planning to raise any old holding company debt in the immediate near term.
So with all three of those behind US It it's where we don't find ourselves in a situation where there's.
Any kind of a sense of urgency with the rating agencies. We they've all published reports relatively recently, we're continuing to execute as we had previously done and I think given where they're at and with all three of them now it's stable loan books.
I think you can.
No reason to that would what should be read into it.
In terms of how they're looking at the sector.
Yeah I think this is.
I hate to speak for them, but they are speaking a little bit more publicly about this in various conferences I think as they've gone back and.
Looking back through time.
This industry is proven to be incredibly resilient no matter, if it's a financial crisis, our co bid or some other things.
And one of them a camera, which one recently did a report that pattern that you know a triple b rated utility default to that.
We presented at the time at a triple B corporate with default or non utility. So so I think there reevaluating.
I think how they look at the business risks overall for utilities.
All the say is the.
Doesn't seem to be any anxiety for any of the rating agencies right now with our particular sector and specifically with us.
Okay. Thank you and I'm just another incremental follow up with regards to funding and capital expenditures are there wasn't mentioned in your Mdna that youre continuing to review the timing of capital expenditures in light of the evolving pandemic and I'm wondering if that just refers to the need for social distancing the potential.
So for stimulus or might there be some other moving parts around renewable policy or you know mobile while technologies or or other things that might cause a big changes in the composition of your capital expenditures or or timing or size.
Yeah, when the it's it's really just about the execution of those capital projects.
For example, they use Nova Scotia as an example, we probably have the most restrictive.
Policies in Canada in terms of people entering the province have to slip Selflessly for 14 days, that's still in existence today and so there are certain capital projects that we deliberately.
Slowed down or defer to next year.
Just in the event that once they get started we could find ourselves in a position we couldn't get the resources in permitted province to complete though to the extent they were contracted on it to the tune ethylene dollars capital program, we're talking probably less than 10% of of the overall capital program and these are projects that will get done.
We're space will get done over the next year or two and some of that could actually be starting up this fall.
So it's more related to the practicality of getting some of these projects of in particular, Nova Scotia.
Thank you.
[noise] and those were our final questions I will now were turn the presentation to the speakers.
I'd like to thank everyone for joining the call. This morning, and your ongoing interest in America enjoy the rest of your day. Thank you.
This concludes todays conference call you may now disconnect.
[music].