Q3 2020 Tetra Technologies Inc Earnings Call
Good morning, and welcome to Tetra technologies third quarter Twentytwenty results conference call.
The speakers for today's call are Brady Bofi, Chief Executive Officer and.
Hello.
No Chief Financial Officer.
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Please note. This event is being recorded I will now turn the conference over to Mr. Servano. Please go ahead.
Good morning, and welcome to Tetra technologies third quarter 2020 results conference call.
[music].
I will like to remind you that this conference call may contain statements that are probably be deemed to be forward. Looking these statements are based on certain assumptions and analysis made by <unk>.
They are based on a number of factors. Please.
These statements are subject to a number of risks and uncertainties many of which are beyond the control of the company.
You are cautioned that such statements are not guarantees of future performance.
And that actual results may differ materially from those projected in the forward looking statement.
In addition in the course of the call we may refer to EBITDA gross margin.
Adjusted EBITDA adjusted EBITDA growth margin adjusted free cash flow district.
Distributable cash flow.
Distribution coverage ratio leverage ratio or other non-GAAP financial measures.
Please refer to this mornings press release or to our public website for reconciliations of non-GAAP financial measures to the nearest GAAP measure.
These reconciliations are not a substitute for financial information prepared in accordance with GAAP EPS should be considered within the context of a complete <unk> financial results for the period.
In addition to our press release announcement that went out earlier. This morning and is posted to our website. Our form 10-Q was filed with the FCC. This morning also.
Let me turn it over to breed.
Thank you Leo good morning, everyone and welcome to the Tetra technologies third quarter 2020 earnings call I'll give a recap of our third quarter highlights and performance and then turn it over to Leo to provide information on the balance sheet cash flow and liquidity.
I'd like to start by first recognizing all the touch currency aside compressco employees and management teams for delivering another solid quarter in a very challenging environment.
Right the sequential 36% decline in the U.S. onshore rig count to hurricane storms that came through the Gulf of Mexico, and the continued overhang from COVID-19, our team's focus and execution of our strategies resulted in positive EBITDA for each of our segments and sequential improved EBITDA margins.
I could not be more pleased with the way our management team and employees have responded to the most challenging eight months, our industry has likely ever face when.
On a consolidated basis, we achieved $30 million of adjusted EBITDA in the third quarter <unk> related margin, improving 150 basis points sequentially. As a result of bar our focus on cost management and maximizing the value of our latest technology compared to the third quarter of last year, we've reduced our cost by $345 million on an annualized basis.
Were 41% as it impacts EBITDA. This compares to an annualized decline of revenue of 373 million, reducing cost by 92 cents for every dollar decline in revenue.
Our positive EBITDA over the past two quarters is reflective of a successful strategy was executed and the diversity of our business with a short cycle North America market longer cycle deepwater offshore segments, and the steady consistent industrial chemicals markets.
Tetra only generated 7.7 million of free cash flow from continuing operations in the quarter and ended the quarter with 59 million of cash at the federal level year to date September we've generated 43, and a half million dollars of touch or only cash from continued operations an improvement of 66.6 million from last year.
Completion fluids, and products' third quarter revenue decreased 27% sequentially, reflecting the seasonal second quarter peak from our industrial European business and also due to project delays in the Gulf of Mexico, as we experienced two major hurricanes in the third quarter.
Despite the lower revenue and sudden impact from the Hurricanes, we achieved higher adjusted EBITDA margins by 110 basis points sequentially third quarter. Adjusted EBITDA margin of 26.8% was also 310 basis points better than a year ago.
International sales for completion fluids, excluding the industrial business increased sequentially by 84% led by some large sales force a major national oil companies in the middle East the deliver for these customers is continuing into the fourth quarter.
Industrial chemicals business continues to perform well made up approximately 36% of the total revenue for this segment in the third quarter, we secured three new calcium chloride road maintenance contracts, so I'd already industry, leading portfolio and this industrial sub sector.
[noise] water flowback third quarter adjusted EBITDA remained positive despite revenue decreasing sequentially, 13%, we continued to see price erosion in the early part of the third quarter, but believed that in most of the basins pricing is now stabilized as activity has improved in September and again in October.
During the quarter, we added a third recycling project with a super major operator in the Permian Basin, that's similar to our other recycle projects. We expect this project to operate for an extended period of time based on our market knowledge and with this award we believe that our daily basis, we were cycling more produced water for frac reuse than any other service provider in the Permian Basin.
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Integrated projects increased from 16 with 14 different customers at the end of the second quarter to 17 with 10 different customers at the end of the third quarter in September of 63% of our water management work was associated with integrated projects with multiple services provided by our Bluelinx automation system. We expect this trend to continue with more integrated.
Logics as North America activity recovers.
During the quarter, our tetra sandstorm that cycle in technology achieved maximum utilization well being continuously introduced to new customers.
As mentioned in our press release. This morning during the quarter, we were approached by customer and the Appalachian region. The former head to head trial against our current service provider or Sandstorm technology was able to achieve 99.4% San filtration, we're far exceeded the current solution the customer was using.
With zero walks downstream and at a peak flow rate of 40 million standard cubic feet per day.
As a result of the successful trial, which also showcased our sandstorm works equally well in high pressure gas wells as it doesn't liquid plays we're now working with this customer to replace or our competitors sand separation equipment.
Providing some perspective on the fourth quarter, we've seen a recovery in the number of active frac crews and well completion activity. Our September and October revenue was meeting with meaningfully better than July and August as we previously stated during our earnings call. Our objective remains to keep the segment EBITDA positive, while leveraging automation and deploying new.
Technology, along with best in class services based on what we know today, we're cautiously optimistic that the third quarter was the bottom of activity in this segment.
Our compression business continues to perform well despite the decline in North America activity, excluding new equipment sales, which we have now exited revenue decreased 1% sequentially to $72 million third quarter. Adjusted EBITDA of 22.9 million was down 3.4 million from the second quarter adjusted EBITDA margins improved 170 basis points.
Sequentially compress.
Compression services revenue decreased 5% sequentially and gross margins decreased 200 basis points to 52.9% utilization declined from 82.1 in the second quarter to 80.3 in the third quarter, we believe that our strategy to invest in high horsepower equipment will allow us to maintain utilization above the low point of 75.2%.
Well seen during the last downturn in.
In the third quarter horsepower rigs on standby decreased from a peak of 20% back in may to approximately 8% at the end of September as our key customer started bringing production and units back on line.
As natural gas pricing outlook improves we believe the production enhancement strategies on existing wells will become a greater priority for producers as they look to maximize cash flow. We should see the benefit of this focus. This compression is a low operating cost solution, which allows producers to increase liquids and gas production when integrated with our artificial lift strategies as much.
And sales I can prescribe as mentioned in sales I Compresscos press release yesterday, we've introduced our new helix digitally enhanced compressed until the metric system. This allows the use of big data to improve performance reliability and predictive maintenance of our compressors. We're excited to be the oilfield service company to a partnered with Houston's Rice University D to K program there's.
The partnerships, specifically designed to analyze big data and develop machine learning modules that enhance our current predictive maintenance programs Weve completed 25% of the hardware upgrade rollouts and expect to be fully deployed by the end of 2021.
[noise] aftermarket services revenue declined 12% from the second quarter, while gross margins improved 200 basis points sequentially, we expect aftermarket services to gain momentum in 21 2021, that's customers catch up on deferred maintenance deferred maintenance from 2020, we're pleased to announce that we secured a master services agreement with a large mints.
In provider for the for the provision of parts and services representing him any immediate revenue generating opportunities to expand in the 2021 and beyond.
In closing I will mention that using all safety protocol protocols I and our management teams have been traveling again to visit our field locations and meet with our customers getting direct feedback from our customers and getting front of our field leaders is critical for our continued understanding or the rapidly changing environment. Overall, we had another solid quarter where margins.
Improved EBITDA was positive we generated free cash flow and improved our liquidity. Despite the uncertainty remaining in the market, we feel that our strategies technologies and industry diversity will allow us to state you, but all profitable and come through this in a very strong position now I will turn it over to ALLETE he'll provide some financial comments on cash flow and the balance sheet.
Well open it up for questions.
Brady I'll first make some comments on TETRAS balance sheet and cash flow then I'll do the same with Sci Fi Compressco and then we'll open it up for questions.
Brady mentioned that we generated $43.5 million of free cash flow year to date, when a tetra only basis.
Which is an improvement of $67 million from the same time a year ago.
This was achieved despite the incurrence of severance and other restructuring and related cost type.
After all the adjusted EBITDA was $7 million in the third quarter.
Tetra only capital expenditure in the third quarter were $1.6 million.
Many of the service companies are generating free cash flow this year from monetizing working capital.
In a business, we balance working capital will increase and consume cash.
We believe that a true metric for measuring the performance of the oilfield services sector during difficult times.
Is to measure their ability to generate free cash flow during the bottom of a cycle. This earnings decline.
And without the benefit of monetizing working capital.
In every quarter this year.
Tetra without yes, I Compressco has generated positive free cash flow without the benefit of monetizing working capital.
Essentially every quarter this year cash earnings.
Yes, they are.
Growth in capital expenditures less interest expense.
Lets any tax payment has been positive.
Of the $43.5 million of free cash flow that we generated so far this year $11.4 million is year to date earnings less capex.
Our interest expense and the best Texas.
The other $32 billion has been from monetizing working capital.
And monetizing receivables in this environment, it's not easy given the financial struggles by many of our [noise].
Our ability to generate $11 million in free cash flow this year without the benefit of working capital talks to the aggressive cost management, we have implemented.
The benefit would be deploying technology to the U.S. onshore market.
In a very flexible vertically integrated business model on the fluids.
In the third quarter were slightly over half a million dollars positive free cash flow without the benefit of monetizing working capital.
For the full year up 2020, we expect tech only capital expenditures to be between nine and 12 and a half billion dollars slightly lower than the prior guidance.
We'll continue to monitor and adjust our capital spending based on market conditions.
We expect total capital expenditures to be mainly for maintenance capital.
And to accelerate the introduction of our new technologies.
Such a sandstorm.
Monitoring blooming technologies.
Tetra only liquidity and ended the third quarter improved approximately $22 million in the same period a year ago. The.
Sufficient enough to be able to continue to manage through this downturn as activity begins to slowly recover.
Tetra only liquidity is defined as unrestricted cash on hand, plus availability under our revolving credit facility.
Tetra only net debt at the end of September with $148 million.
With cash on hand of $59 million.
Our 221 million dollar term loan is not due until August 2025.
In our 100 million dollar asset based revolver does not mature until September 2023.
The only significant maintenance covenant, we have to comply with it's a one time interest coverage ratio on the term loan.
At the end of September our interest coverage was three and a half times.
Annual interest expense on this term loan is approximately 15 and a half to $17 million.
And as always I'd like to give me my never have that doesn't see us that compresscos debt are distinct and separate there are no cross default no cross guarantees.
On the debt between Tetra CS I compressed.
Now, let me spend a couple of minutes I'll see if I compressco.
See if I can press with cash on hand at the end of September was $16.7 million up from 2.4 at the beginning of the year.
At the end of September there were no amounts outstanding on the revolver compared to $2.6 million that was outstanding at the beginning of the year.
The reduction in the Austin, Imelda revolver, plus the increasing cash represents almost a $17 billion improvement from the beginning of the year.
By very challenging market conditions.
And this is after CSR compressco paid almost $5 billion of legal and advisory fees.
To complete the debt swap in June of this year, which resulted in a net reduction of $9 million.
And pushed $250 million of maturities came to 2025 and 2026.
If I can first of all they're Midland fabrication facility.
And they didn't real estate and have targeted sales $30 million in compressor assets in the second half of this year.
They are pruning defeat the fleet by selling older idle.
Idled smaller units generate cash to either reduce debt.
Investing technology that we believe will generate higher operating margins or.
Oh, you invest in larger compressor units.
Your objective is to generate between 15 and 25.
Cash flow by 2021.
To partially pay down debt maturing $81 million of unsecured notes.
And to refinance the remaining amount.
For the full year 2020, see if our Compressco I expect capital expenditures of between $6 million to $7 million.
And maintenance capital expenditures of between 20 and $21 million.
Like Tetra CS I Compressco continues to invest in technology to drive greater margins and enhance returns and this year, they expect to spend between five and $6 million.
Other than the $81 million of unsecured notes that are due August 2022 for CS I Compressco the.
The $555 million up first and second lien bonds are not due until 2025 and 2026.
Yes, I Compressco net leverage ratios in September with 5.4 times.
This compares to over seven times.
Given the prior downturn.
And as I've mentioned before see if I could probably go does not have any maintenance covenants that they need to comply with.
And also as mentioned earlier, so yes, I compressco does not have any amounts drawn on the revolver.
Yes, I compressco generated $14 million at free cash flow in the quarter and year to date free cash flow was $24.7 million.
Distributable cash flow within a half a million dollars in the third quarter, which.
Which increased by 25% is even if it benefited from the sale of used assets.
Through September distributable cash flow of $27 million.
On an annualized basis distributable cash flow will be 36, and a half million dollars.
Or approximately 70 cents 77 cents per common unit.
This compares to she has the effect of Buskers unit price at the close of business last week of 85 cents, which is not a bad guess will yield.
Tetra CS I Compressco continued to perform well given the macro environment, if all our segments remain EBITDA positive.
Tetra CS I compressco generating free cash flow, even without the benefit of monetizing Brecken capital.
And now doesn't $81 million of unsecured debt that is due August 20, twond to foresee a second compressco.
No near term maturities.
We encourage you to read our news release from this morning, and see if that Compresscos news release from yesterday for all the supporting sales and additional financial and operational metrics.
Additionally, both tetra and see if I compressco have already filed their 10-Q with the FCC.
With that Debbie lets open it up for questions.
We will now begin the question and answer session to ask a question you May Press Star then one on your Touchtone phone. If you are using a speakerphone. Please pick up the handset before passing the keys.
Withdraw your question. Please press Star then two at this time, we will pause momentarily to assemble our roster.
At this.
Moment.
Our first question comes.
It's from John Jim will now, let's we'll now asset management. Please go ahead.
Thank you.
Oh leak you two questions in Brady you mentioned that you're in the process of winning a contract anomalies on the water flow back side.
Can you give any color whether doctors the skiing, taking from a small regional player or a larger player in the space.
Jim good.
Good morning.
We believe that the smaller regional player. It's it's not what I would consider to be a a larger player that operates in multiple basins.
Got it. Thank you sudden quest is I just want to.
Make sure I heard correct.
Correctly, you are estimating that you are.
Now.
Number one in water recycling in fracking was out in that particular basin or.
Just a little color to that whatever you're referencing.
Well, we will you have estimated that number could be a year ago.
Sure.
So Jim we had our first large recycling project award.
In the late 2018.
My reference and the current comments that I had made is this is now our third.
Major recycling project and based on our local knowledge in the Permian basin and the amount of barrels of water that we are cycling on it on a daily basis for Frac reuse. We believe we're the largest.
We have the largest ER volumes of water that were re frac, we cycling on a daily basis as my reference.
Got it and the performance in the Permian Basin.
Got it thanks, thanks very much.
Thank you.
The next question comes from Stephen Gengaro with Stifel. Please go ahead.
Hi, Thanks, and good morning, gentlemen.
Good morning.
I had a few things that I apologize if you hit on the babies, because I got disconnected, but but first.
Well, we think about the completion fluids business and the margin progression. There you put up very good margins in the quarter. Despite.
The Gulf of Mexico.
Storm issues, Oh, and obviously the sequential drop some content from the European business.
When I look at it is mid 20 EBITDA margins are.
Are they sustainable without.
CS Neptune work over the next few quarters.
Yes, we believe they are I think we've referenced several quarters ago that we had a target to maintain over 20% EBITDA margins.
And I think now we're on the sixth quarter, or so where we have not only been above.
20%, but but well into the mid mid Twentys percent range, that's really a couple of factors one.
We've done a great job of streamlining our industrial chemicals business with some some really favorable supply contracts supplier contracts for raw material and streamlined our operations through several of our plants with the shutdown of our mechanical evaporation facility in L., though.
Even with that we still have plenty of capacity left to grow from the other plants that we operate at so though that all in has had a pretty significant impact on our ability to generate.
Industrial margins are similar to what you're saying on the fluid side [noise], Although we had a we were hurt by the Gulf of Mexico Hurricanes this quarter.
We had some very nice sales into the middle East Weve mentioned before we had been awarding some some market share gains, including several large and overseas that operate in the middle East.
We were able to secure those types.
Types of margins that you're seeing contributing to the margins that you are saying and so so we believe its sustainable.
Well see as we get into 2021, and what the outlook looks for the markets, especially the offshore markets, what I can [laughter] loads Mark markets.
But booked for the foreseeable future. We believe we can sustain the types of profitability that we've that we've been achieving its Steven let me.
Remind everybody at some of the margins that we've achieved in the second quarter of last year were 22.4%.
Q3, a year ago were 23.7% both of those quarters had no Neptune in there.
In the fourth quarter with the Neptune project, we jump all the way up to 35.2%.
And then this year, we've done 28.7, 25.7 and 26.8%.
For this segment on an adjusted EBITDA margin.
And then there was a little bit of carry over of Neptune from Q4 into Q1, but it was minor. So it tells you that even without Neptune were achieving those targets already.
And we ought to be.
Hi, <unk> I believe I had.
In my notes and I I'm not sure. If you can give us a sense what the U.S. land piece of that is a pretty small piece of the total revenue I think.
Can you give us any any color on sort of the revenue contribution from different segments, because because given what's happened in the U.S. lamp business. Those margins are are fairly stable in fairly high.
Yeah, we mentioned that on an annual basis about 40% of our revenue from this area is from the industrial both northern Europe and the United States.
The rest of it is primarily the offshore business, both Gulf of Mexico, and international there is some amount of U.S. onshore, but not enough to move the revenue.
Yeah, I, just though out a little bit of color to that on the completion fluids side of the business. We have a very small contribution from the U.S. land market. So we're really not impacted on the completion fluids up however, our industrial chemicals business. You know clearly is a contributor into the North America market.
Segment geographically, obviously, it's a different segment than the oil and gas segment, but from a us perspective, our industrial U.S. business is a very good business.
Great. Thank you for that and then.
As we as we look I'm just thinking about the other piece of the business, but on the water.
And flow back business I mean, that's clearly more U.S. lamps focus should we expect that to kind of track the U.S. land market here over the next four to six quarters does that is that a reasonable way to think about as you're trying to try to push to get EBITDA improvement.
Yeah, we believe so we're clearly seeing a a an increase in activity a meaningful increase in activity in both September from the low points in July and August and then again in.
In October and we believe that that will remain fairly consistent growth throughout the fourth quarter as.
As you look at the next year I mean, it's still little bit early days.
With where things are with cobot et cetera, but based on the the conversations we've had so far with our customers and from some of the projections on frac crews from from rice that and others.
In the industry.
Yeah, we expect that 150 to 175 Frac crew type of of activity levels, which as you know.
Not quite to the levels, we were pretty covert but in the in this environment that would be a meaningful impact for us from our orbit our business to grow and improve profitability.
And on the on the sand side of that business are you gained some share on the sand side I believe.
Is is that piece.
At a point where it's.
Essentially you know, 10% or more of that of that segment or are not yet is that is that margin accretive.
Well it definitely is margin accretive it's very automated Yamada resources, we deployed on that relative typical flow back job.
Yes, a significantly less it's.
It's gaining traction very rapidly with several of our key customers I wouldn't say that we're yet up to that but it's holding well, it's gaining market share and it's improving and I think Brady mentioned.
Either on the earnings call earlier today, all our equipment into service pretty much fully like yeah. This this is going to be one area, where we'll win we will need some capital investment for next year. If we continue on the growth path because we're sold out of our current the number of units.
Okay, and just one from just a strategic purpose.
Her perspective, if if we look at you know two.
2000 to 2023, and we're thinking about what tetra looks like.
[laughter] do you think you have how do you think that business evolves.
You know if we get back to kind of a more normal level of activity in the U.S. land market and globally things are settled down I mean, what's the what do you think about sort of the the margin potential of the entity and how the structure of the company looks.
[noise] well I think we're very happy with the components of the business that we have Stephen the the segments that we have we were very well positioned in the water and flowback ER segment as that market recovers.
Clearly these are unique times with this downturn.
And we feel we will get back to more normal levels of U.S. land activity, maybe not all the way back in 2021, but certainly by 2022 and 2023, we think from our business perspective with some of the share gains that we've had and the fundamental cost structure that we've put in place we will be.
Be closer to 2018 type levels of profitability on the on the fluid side, we continue to find new opportunities for our industrial chemicals business and as I said, we would change the profitability profile of.
That business.
Our offshore completion fluids business continues to gain share. So I don't expect 2021 to be a huge ramp up.
In offshore activity, but 20 to 22 2023, I think you will start to see some meaningful activity return and then our Neptune projects that we're tracking we.
We expect to see some contribution in 2021 in some meaningful significant contribution 2022 based on the projects that we have been working.
With operators on so so yes, I would expect 2022 and 2023 to be perhaps our most profitable years, yet to come for Tetra and Stephen I'll also remind you in mid 2019 water inflow pack was generating mid teens.
EBITDA margins.
And since then we've made significant investments in automation and remote monitoring.
Sandstorm has gained quite a bit of traction and.
And I think that we will see that benefit in a recovering market.
And then we also mentioned earlier that that we believe that we can continue to achieve mid 20% EBITDA margins on the fluid side.
And when we pick up net Neptune projects that those can easily push up into that 30. So we think that we will have the benefit of automation technology, a new introduction of equipment in the future.
Okay very good. Thank you gentlemen, if I could just add.
Got it and one more do you has there been any visibility slashed traction from the Halliburton Alliance and as you start to think about.
The other deepwater market I mean, obviously it seems to be a little behind but do you see that are the sort of increased traction on on the CS Neptune side going forward.
Yes in fact, we have a major project in the North Sea with an operator were Halliburton has the has the contract and we are working hand in glove with them to deploy Neptune and.
And we expect that the show results and 2021.
Okay, great. Thank you gentlemen.
The next question is from Joe Stefan Meister with inter market.
Please go ahead.
[laughter].
Hi.
Most of my questions have been answered, but I guess or we could go back to your plans for she aside compressco and the <unk> the potential deconsolidation is so.
If I could call it that.
Yeah.
Good question, Joe So I think that we've been very clear and our message in the last year and a half in it that way.
Both the management team of Tetra and the board of directors, our Tetra focused on enhancing shareholder value and we're all hoping to evaluating all options and alternatives.
Earlier this year.
We completed a debt swap with the effect of price going in June when we extended the maturities for.
Our unsecured debt into 2025 and 2026.
We also stripped any of the change of control covenants, so that the $81 million of unsecured debt does not trigger any maturities when a change of control.
So I feel confident that both the management team and the board of Tetra are focused on enhancing value and we'll evaluate all options and I'll stop my comments at that.
Thank you.
Next we have a follow up question from Jim Al Let turn now asset management. Please go ahead.
Thank you.
Brady a question, we get from our shareholders, who contacted so I'm just going to put it to you to two to kind of put out there. So so we don't have to answer it we get we get informed a lot that the companys non energy fluids business.
The industrial side of the business that those businesses are now trading at 10 to 12 times EBITDA.
Which would.
Which would make your non energy fluids business, you know potentially worth something like $200 million.
My question is.
First just or the business is separable.
Or are they are they my understanding is that that business was purchased several years ago. So I just wanted to to to ask or they separable and two.
Given the.
Given the.
Oh, the place where energy stocks are trading in general.
Notwithstanding your confidence in the market on the energy side returning in the next two years two to three years.
Where do you see if if that business stays trapped the value that business days trapped because of the the energy narrative surrounding the company.
At what point in your mind.
Is it worth the company thinking about strategic actions to kind of unlock that value, particularly if it's true that those industrial fluids businesses right. Now are there's just a lot of interest in <unk> and then evidently in the private equity world just any kind of high level color would help sure.
No that's a.
Fair question. They are separable are.
Industrial operations plants.
Supply to both industrial applications for our chemical products.
As well as feeds our offshore fluids business, if if we separated that and sold it to another party or somebody else operated we would still be able to.
By the chemical products, the calcium chloride et cetera that we would need to operate our completion fluids business, we might have a bit of a of a margin impact.
On that but but they are very separable and could operate independently from from Tetra today [noise].
As far as on unlocking the value me clearly.
Today, we get a lot of centers, we think we get a lot of synergies between a lot of the fluid developments a lot of the technologies that we developed both on the completion fluid side and.
Having that vertical integration the R&D that goes with that.
Products like Neptune and other products. We haven't works are result of that synergy, but clearly if the if the energy markets didn't play out as as I feel they will ultimately.
We would certainly look at strategic options to unlock that value Jim.
Got it thank you.
This concludes our question and answer session.
I would like to turn the conference back over to Mr. Murphy for any closing remarks.
Well. Thank you very much we appreciate your interest in Tetra technologies and thank you for taking the time to join US. This morning that will conclude our call.
The conference is out now ended you may now disconnect. Thank you for joining today.