Q4 2020 Stella-Jones Inc Earnings Call
Good morning, ladies and gentlemen, thank you for standing by.
To Stella Jones, Q4, 'twenty 'twenty earnings Conference call.
This time, all participants are in a listen only mode.
Following the presentation, we will conduct a question and answer session and instructions will be provided at that time for you to queue up for questions.
Anyone has any difficulties during the conference. Please press star followed by zero for operator assistance at any time.
Before turning the meeting over to management. Please be advised that this conference call will contain statements that are forward looking and subject to a number of risks and uncertainties that could cause actual results to differ materially from those anticipated.
I would like to remind everyone that this conference call is being recorded on Wednesday March 10 2021.
And I'll now turn the conference over to <unk>, President and CEO. Please go ahead.
Good morning, ladies and gentlemen.
I'm here with Silvana, Travaglini, Chief Financial Officer of Stella Jones.
Thank you for joining us for this discussion are the financial and operating results for Stella Jones is fourth quarter and full year on December 31st 2020.
Our press release reported Q4 results was published earlier this morning, along with our MD&A can be found on our website at www Dot Stella Jones' dot com and will be posted on cedar today as well.
Let me remind you that all figures expressed on today's call are in Canadian dollars unless otherwise stated.
Our strong performance in 2020 is a testament to Stella Jones is resilient business model the strength of our team and its ability to effectively adapt and deliver strong results for our stakeholders. Despite the many challenges faced.
Based on throughout the year.
I'm extremely proud of the unwavering personal commitment determination and professionalism and collaboration over on pilot employees.
That they displayed throughout the year.
We concluded 2020 with record sales and profitability.
Sales increased for the 20th consecutive year, while EBITDA rose, 23% to $385 million and net income increased 29% to $210 million.
Increased profitability translated into record cash flow from operations, which allowed us to return $100 million to our shareholders, while continuing to invest in our network.
In line with our capital allocation strategy today, we announced a 20% increase in our quarterly dividend and an increase the numbers of shares that can be repurchase under the normal course issuer bid demonstrating our confidence in Stella Jones is a strong cash flow generation and our commitment to deliver continued value to us.
Shareholders.
Let me begin with a brief overview of our fourth quarter results.
Sales for the fourth quarter of 2020 amounted to $533 million up from sales of $445 million for the same period in 2019.
Excluding the negative impact of currency conversion pressure treated wood sales rose $78 million or <unk> 19 per cent.
Utility pole sales amounted to $201 million up from $195 million from the same period last year.
At the end of the first quarter day.
Men, particularly from Canadian customers has been impacted by pandemic restrictions as certain utility companies have continued to limit maintenance activities in an effort to protect their maintenance crews.
As a result.
<unk> have remained relatively stable quarter over quarter most of the 4% increase in sales. This quarter is attributable to healthier sales mix, which included the impact of the value added fire resistant rep pool sales.
Railway tie sales grew $147 million up from 140 $134 million last year.
In line with an improving industry demand trend compared to the same period last year, we realized sales growth of 11% quarter over quarter.
This was mainly driven by our flexibility to serve as class one customers, leading to higher volumes and our ability to maintain solid non class one sales despite pricing headwinds.
Residential lumber sales reached $117 million almost double the $61 million generated for the same period in 2019.
The record high market price of lumber and to a lesser extent the continued strong demand from home improvement products explained the significant sales increase this quarter.
The higher market price of lumber is also a reason that sales of logs and lumber were up 45% compared to the same period last year to $45 million.
Silvana will now provide further details regarding our results and financial position before I conclude with our outlook Silvana.
Thank you, Eric and good morning, everyone turning to our profitability.
Gross profit grew 21% to 85 million compared to Q4 last year, while operating income was $50 million compared to $41 million in the fourth quarter of 2019.
Similarly, EBITDA rose to $70 million up 19% compared to 59 million in Q4 last year.
The increase was primarily driven by higher sales prices for residential lumber, which exceeded the high cost of lumber.
Why was the improved sales mix for utility Poles.
Adjusting for other net losses EBITDA for Q4, 'twenty, 'twenty, and 'twenty 19 were $73 million and $16 million.
Representing EBITDA margins of 13, 7% and 13, 5% respectively.
Net income in the fourth quarter increased 21% to $34 million or <unk> 52 cents per share versus $28 million or 41 cents per share last year.
Let's turn to a brief overview of our full year results.
Sales in 2020 reached $2 $6 billion excluding.
Excluding the positive impact on the currency conversion pressure treated wood sales growth $309 million or 15% with both volume and pricing gains across the company's three core product category.
Driven by strong sales growth EBITDA increased 23% to a record $385 million or a margin of 15, 1% up from the $313 million on a margin of 14, 3% last year.
Adjusting for other net losses of $12 million EBITDA in 2020 was $397 million, representing a margin of 15, 6%.
Net income rose to $210 million or $3 12 per share versus net income of $163 million or $2.37 per share last year.
Turning to liquidity and capital resources with our strong financial results. This year, we generated $402 million of cash flow from operating activities before changes in noncash working capital components and interest and income taxes paid.
The anticipated increase in sales in 2021 resulted in an over $120 million build in inventory. This year. This largely explains the reduction in cash from operations to $178 million.
We deployed the cash generated to make capital expenditures of $55 million and return capital to shareholders by paying dividends of $40 million and buying back one 3 million shares for a total of $16 million.
We concluded 2020 with long term debt, including the current portion of $606 million in line with last year we.
We maintained a strong financial position with a net debt to EBITDA ratio, which includes lease liabilities of one nine times and our available liquidity was $190 million.
Subsequent to year end the amount available under the demand on facility was increased from 50 million to $100 million U S until June 32021.
Providing the company with additional flexibility to invest in the inventory required to support the anticipated sales growth in 2020 one.
Yesterday, the board of directors of Stella Jones declared a.
A quarterly dividend of <unk> 18 cents per common share representing an increase of 20% over the previous quarterly dividend.
On April 24th 2021, two share holders of record at the close of business on April 5th.
This represents the 17th consecutive year of dividend increase.
Finally on March 9th the company received approval from the PSX to amend its normal course issuer bid in order to increase the maximum number of common shares that may be repurchase from $2 5 million to $3 5 million shares.
The amendment will be effective on March 15th 2021, and will continue until August nine 2021.
I will now turn the call back to Eric for the outlook Eric.
Thank you sold on them.
While the impact of the ongoing COVID-19 pandemic on the demand for the company's product is still uncertain, we expect year over year organic growth in sales and profitability for 2021.
Based on our current outlook and various assumptions, we expect to generate an EBITDA in the range of $385 million to $410 million.
This guidance anticipates headwinds of approximately $50 million in sales from the deterioration of the value of the U S dollar relative to the Canadian dollar.
Excluding the currency conversion impact we project sales growth in the low to mid single digit range for 2021.
Until the pool of sales are expected to increase in the mid to high single digit range compared to 2020, as we project sustained growth and replacement demand, including an increase in the value added fire resistant rep pull sales.
For residential lumber, we're also forecasting mid to high single digit growth compared to 2020 and this is driven by the continued strong demand for home improvement projects.
Current estimates of higher pricing as well as projected increase and market reach.
The sales of railway ties and industrial products are projected to be relatively comparable to those generated in 2020.
Please consult our MD&A for details of the economic and market assumptions used to prepare this guidance.
Stella Jones isn't strategic vision is focused on enhancing the company's presence in its core product categories.
We are seeking other strategic opportunities that leverage the company's footprint customer base fiber sourcing and other competitive strengths, we intend to be active on the acquisition front.
On innovation continued to improve our operating efficiencies and expand our capacity to sustain our profitability.
Our priorities for 2021 include providing continued support to utility pole customers that will transition to an alternate preservative solution in preparation for the gradual phase out of pentachlorophenol and a successful ERP implementation.
As one of the leading providers of industrial treated wood products. Our primary objective is to enhance the company's businesses business resilience and generate consistent value for shareholders.
This concludes our prepared remarks, and we will now be pleased to answer any questions you may have.
Thank you I'd like to ask a question. Please press star followed by the number one on your telephone keypad to withdraw your question. Please press the pound key well pause for just a moment to compile the Q&A roster.
So my first question will come from Walter <unk> from RBC capital markets. Please go ahead. Your line is open.
Thanks, very much operator.
Good morning, everyone. Good.
Good morning Walter.
So I'd like to start with the Tightest Division.
Obviously, covering the rails, we know that debt congestion is very high right now the railroads have limited ability to kind of take.
Take any track offline.
For upgrades understanding that ties our it is not something you can defer too long, but you're guiding to kind of flat flat sales here do you think that that guidance is really a reflection of the railroads lack a real incentive to.
Do major maintenance this year and could we see a lift in future years as you know.
<unk> normalized and the railroads may come back with a little bit of an amped up rail rail tie demand profile post 2021.
I think you are correct Walter.
On the current year's maintenance programs have been.
Now last year as you know and I believe that the railroads will well execute on that plan.
From our view they are at a minimum debt they've done historically so to your point I do believe that we could see an uptick with the class ones in future years. So I think it's on.
Fair assumption with regards to the day non class one business, we are seeing still a lot of activity in demand from you know from from different market participants.
Obviously, the federal credits are supporting the financing of those projects. There's also or what is referred to as Christie grants, which also supports in the same line debt.
On the short lines and the non class one business. So I do think that that will sustain demand going forward. So I think there's two aspects to what youre looking at but I think your assumption is fair that we could see a.
Poor trends in maintenance volumes in coming years.
Okay. My second question is really around the visibility behind your guidance on the revenue side can you touch on it.
Which segment do you feel you have the highest visibility either due to the structure of the contracts or the indications you've had from customers and where do you have the lowest visibility kind of on a segment by segment line.
Certainly.
We just discussed of railway ties.
65% of our railway.
Railway tie division revenues are class, one which is.
Supported by annual contracts and you know all our dmitry customers have provided guidance. So I would think that is the one where we feel the most comfortable with with regards to day guidance going forward.
Secondly.
Mentioned.
You mentioned the utility pole product category.
Where again, we have contracts in place and on.
On going discussions with engineering departments.
Our other utilities, our customers, where we talk about the maintenance programs.
That when it comes in second Sn.
Essentially because so there was a bit of caution with regards to COVID-19.
Do you see the cases down in North America, and vaccines being deployed so we could think that this could trend back to normal maintenance activities.
And third I would say the residential lumber.
Obviously, no annual contract and it really depends on market demand, we've been planning the 2021 season with our customers now for several months.
Albeit indicating strong demand we've confirmed this also with several contractors in the market that.
<unk> will be strong for for outdoor renovations in the coming year.
But.
Again, I guess, that's what would be the one where obviously there is no. There is no contracts from it up so but I have high faith in what our customers are telling us and as we're sort of no.
Deploying or sell the inventory this year, we're sort of seeing that trend in demand continue as we've seen actually in December when the volumes were actually up year over year, we're seeing a continued trend on that front.
That makes a lot of sense. Okay really helpful. There last question is on your capital allocation, our free cash flow and capital allocation.
It seems that.
Acquisitions are a little.
I know you remain interested but activity level is fairly low.
Yeah, I would I would guess correct me if I'm wrong on that perhaps.
Sellers.
Target or.
Multiples are elevated.
You've ramped up your dividend now.
Amped up your buyback can you can you cover off what you could see as being your maximum payout ratio. If there were no acquisition opportunities how high could you see your payout ratio go.
And comparatively how high would you see your leverage go if you were to start paying out an increasing amount of your your.
Your free cash flow in the form of either dividends or buyback.
So.
A lot of aspects in your question there so.
On the leading indicator Dara two two.
As for your question would be your leverage right. We've guided the market other our capital allocation policy of leverage between two and two five.
We are coming out of a very strong year in 2020, we generated.
Very strong.
Cash flows and with the current guidance, we're very confident in our future cash flows as well so the strategy behind renew India in CIB as well as increasing the dividend is to return value to shareholders and more.
Maintaining debt debt leverage level.
So normal state I would say, we would lever in that range of the 2% to two five.
I'm fully confident.
That discussions that we're currently having with targets on M&A, you know will will come to fruition at what point in the year, where where we intend on being active on the M&A front.
That's why we were structured that way with our capital allocation. So the two to two five is really our steady state business and we're ready to lever up let's say to three times.
Which is well under our bank covenants to be able to do an acquisition, which is plenty to execute on what we have on the table right now.
Okay. That's very helpful. I appreciate your time, Eric My pleasure. Thank you Walter.
Your next question comes from Samir Patel from CIBC capital markets. Please go ahead. Your line is open.
Hi, good morning.
Yes.
The mid to high single digit growth expected in polls and res lumber this year, how much of that is is volume.
So for the.
Yeah, we don't really quantify it.
No.
It is.
There's a lot we don't quantify theres, many assumptions behind that obviously the pricing depends on where the price of love. There's gotta go for the balance of the year, which currently our assumption is to maintain steady state.
But net and then we have confidence in the volume look if you need to use an assumption I would probably say 50 50.
For the residential lumber and for utility Poles.
Say something similar as well.
Fair enough that's helpful on Eric I wanted to ask you about you know are on the pulp side of the business as a electric vehicle kind of adoption increases over the coming decade.
What kind of impact do you think that could have on pull demand I'm just thinking as charging networks get built out and then also.
On a connecting all the growth in on renewables to the grid.
Any additional demand for electricity.
On the North American grid.
Would play favorably with regards to demand to support that network, maybe pulls or different hardware items. So.
So I think it would be positive.
Our customers are not necessarily talking about that all.
Along those lines.
I think debt.
Investments related to such a demand could be accelerated if governments decide to support it to subsidize it to some extent to favor electric vehicles, otherwise you know it will be like a market trend.
So to answer your question I think it would be positive it will be positive interest a question of the timing of the occurrence.
Sure.
Fair enough and just a last question from me Silvana could you maybe highlight if there any major capital projects and the the budget for 2021.
No in terms of the in terms of the guidance.
$50 million to $60 million, we are expecting to be at the high end of the guidance for for 2021 keeping in mind that included in that continues to be our ERP projects. So I would say you know one of the more significant ones would be the the ERP spend that we continue as you know we're resting on India implementation.
On that project other projects well I'll also share.
Recall that I mentioned and he is our priority is looking at it.
Getting our customers and converting some up on it right off our cylinders for different precipitous for a pent up replacement.
So those I think it.
Would be sort of the.
The major assets to meet your Capex.
Okay, great. Thanks, Oh, yeah.
Thank you Amir.
Your next question comes from Ben <unk> from Deutsche Bank. Please go ahead. Your line is open.
Yes, good morning, Susan on good morning, Eddie bolt on.
Yes.
With respect to the lumber inventory, obviously, a greater fortunately you've been able to replenish the.
Inventory over the last month I was just wondering if you feel that you're having a competitive advantage versus spears to meet strong demand in 'twenty 'twenty, one and given all the investment made toward the inventory in the last two years.
Would you expect a reversal at some point and is it more a late 'twenty or 'twenty, one or 2022.
Well, it's a very good question. So obviously the the inventory volume that we replenish for residential lumber in the fourth quarter and as well in the first quarter of this year.
Our debt very.
Higher prices compared to last year right. If you followed the lumber markets today.
Today, we're roughly we're sitting at.
Two five times the price you were a year ago. So obviously, our investment in inventories higher and if the markets. The general lumber markets drop you would see a decline in our inventories thats at the end of this year or two from 2022 that being said I think Stella Jones is strong balance.
Balance sheet and strong financials enable us to be able to invest in inventories at that cost.
Which.
Hard to say, what our competitors are.
Debt.
As far as debt can can accommodate but we definitely feel that we're in a strong position to be able to procure sufficient volumes to execute on our guidance and as well to support our customers' expectations as far as increased volumes.
Okay and would it be fair to expect kind of a pause it is inventory reversal as we go through a more normalized years, let's say beyond 'twenty 'twenty, one day to day or Silvana.
So there are two items that play there right. So one to your point, if the prices and you know I hate quoting.
Quoting numbers, but if your your prices are.
Decline, let's say in the next 12 to 18 months for lumber again, yes that will pull it down but then there is also another effect of additional.
Additional volume that we were gaining year over year and do plan on maintaining as last year in 2020, our teams did a spectacular job servicing our customers.
The industry has acknowledged stellar doses capability and as a result, we've gained extra volume extra market reach if you want so that additional volume.
Carry on into the future. So you have potentially two off not perfectly offsetting but two different variables that debt will could play against one another in the future.
But that's that's great color and for residential lumber as Canadian get vaccinated later.
Would you expect your residential lumber to old better in Canada versus the U S. As Americans might be looking to spend differently. Once vaccinated is there a big discrepancy between Canada and the U S on the residential side right now.
That's a difficult question for me to answer on the dynamics of.
How did the populations will.
<unk>.
Return to.
A new lifestyle or two they're all lifestyles.
Difficult to predict what what we're working off of is how we're working with with our customers currently and what they are guiding so I'm quite confident debt.
But by mid year.
We should be.
By mid year, we should see a good part of our gain realization. If you remember may and June April May June our heaviest months for sales of residential lumber.
Remember also that the.
The U S represents maybe 30% of our product category sales in Canada, 70%.
So to your assumption if it's a bit later in Canada, I think it pulls relative thing that we should still have a strong H one as our customers are indicating and I think the whole year should be very healthy on the volume side.
Okay and last one for me just with respect to the storms. We saw in Texas. Just wondering if there was any benefits or maybe some disruption on the supply chain and the weather that's created some pent up demand for Stella Jones going forward.
So the the stores we saw on the U S. Southeast mill, So when I say stores. There was snow there was ice storms there was intense cold.
Can't say there were.
Event that required more pulls or more railway ties. So it's not necessarily a benefit it would not translate into into additional sales that being said the.
The distribution networks were down in the U S. In particular, the rail networks car flow reduce the reduced to some extent it took a while for it to take to get back moving our facility themselves were actually shut down for a weekend. There was no power no gas and so on so.
But I'll just say no significant impact I would say on the utility pole side railway ties we will see we'll see how quickly we can catch up is it going to take the month of March or early.
Early April to catch up but the orders are there. So it's not a question of missed opportunities. It's a question of just having to live with the consequences of the disruption in the transportation network. If you will.
Okay. That's great. Thanks for the time.
<unk> been one.
Your next question comes from Michael <unk> from TD Securities. Please go ahead. Your line is open.
Good morning.
Morning, Mike.
Eric on the outlook for 2021 can you talk about your margin expectations and specifically.
Specifically some of the moving pieces, we should be thinking about when we look at 2021 versus 2020.
Uh huh.
So the well the margin assumption will vary between the low end into high end, but call it.
We like to aspire debt.
We would maintain a 15% EBITDA margin going forward and.
Items that could help improve that if you want or things to consider would definitely be with.
COVID-19 sort of phasing out seeing a return to a maintenance level from our utilities, which would also translate.
Believe into also increased sales of our fire resistant Rob Poles.
Obviously right now we're sort of in a positive trend, which makes me quite optimistic about the day to the remainder of the year.
Following that I guess.
Railway ties I think were relatively stable with our demand.
I don't see any significant swings in inventory costs for.
The balance of the year and then for residential lumber we need to keep on on our on our radar how the market prices will fluctuate.
Going forward obviously.
If the.
Market prices would drop.
We would adjust pricing at our own cadence, depending on how our average inventory cost.
Would.
Would adjust but still those are things, we need to we need to keep in mind.
Okay, and then just to be clear when we're thinking about the EBITDA.
The guidance range on that I guess also on margins the the guidance range you've given for 2021 are you assuming.
Nothing in terms of the other losses line, which which I guess.
There were some amounts that flow through that in 2020 is that nothing for 2021 on your assumption.
That is correct.
Yes that is.
Correct.
Okay perfect. Thanks.
Just a question about moving to residential lumber, you're calling from mid to high single digit revenue growth in and.
The current year here.
Can you talk a little bit about how you see that playing out as we move through the year in terms of maybe half one versus half two I think you sort of go alluded to.
And on expectation of a reasonably strong half one, but just you know what.
What is going into that full year expectation as it relates to kind of a first half versus second half.
So really if I think of last year.
There was there's there was a significant difference between H, one and H two last year.
In pricing obviously.
One was a very steady price.
And you could go back to the lumbar growth and figure that part out but then in the second half had very higher pricing, which you deal with.
We'll be closer to what we have today, we're still actually actually today a bit higher than the average of H two for last year. So I would definitely thing debt for H, one we would see volume and pricing.
Being strong contributors to our growth.
And then for H two pricing you know if the pricing has maintained pricing would have less of an impact on that volume would play.
On.
Our clients are starting to discuss age two and Theres still foreseeing a healthy healthy.
On a healthy second half of 2021, which is encouraging and it's really to that level of.
The expectation that we're actually procuring and preparing our season, obviously the peak being in Q2, but obviously the summer months and early fall are also very active months, if the weather permits.
Okay, but if you actually so your you mentioned that clients are starting to talk about the second half.
The.
And the outlook for residential lumber that you've provided are you are you factoring in.
Some of that potential strength in the second half are you taking more of a conservative stance at this point.
It's really in a range right from from the bottom to the top I mean, the top range would bring us to a very strong year in both in both half of the assets of the year.
Okay got it got it.
And then just maybe a bit of a.
Sort of a bigger picture question as it relates to to pull so your you had a.
Good good very good organic growth again in 2020, and you're calling for further <unk>.
Strength.
In 2021, I'm just wondering if you can sort of try to frame where we're at in terms of.
The replacement cycle, if I can call it that I mean theres been talk for some time about how there was underinvestment in the in the North American.
Like American infrastructure and utility Poles area.
Seen good growth for some time, calling for further growth.
Where do you think we're at in terms of you know.
Addressing the need to replace the.
The existing stock.
So our customers don't necessarily share there.
Did their maintenance programs are very long term, we do have certain insight as to their intentions beyond the current year.
<unk>.
We've always guided the mid.
Single digit growth for Poles for for a certain number of the years ahead.
I think where we're still in.
In the in the beginning if you compare it to hockey Baby, where and we're still on the first periods I don't know how to better explain it as far as timeframe, but I think there's still a lot of a lot of work to be done with our customers with regards to planning out more maintenance for for several years to come.
Okay. That's helpful. Thank you and then just lastly, Eric he did.
Briefly address a sort of the prospect of M&A.
Earlier in the call in the context of a broader question about capital allocation, but.
I'm wondering if it's possible for you to provide any further insights into kind of how you're thinking about this year, the M&A pipeline and what you think could happen etc.
Right well so.
We intend to be active.
On the M&A front for 2021.
Last time, we had a discussion on the topic on our last call I did indicate that we were talking to.
Certain targets and we continue to do so same targets nothing has really changed the discussions are all progressing at different paces.
We as a company remain disciplined in the multiples we are ready to go we're going to pay but I would.
I think that they are that is not a headwind in our discussions things are moving positively.
That's about all I can say really Michael on that front.
No I appreciate that thanks.
Thanks, very much work I'll turn it on thank.
Thank you.
As a reminder to ask a question. Please press star followed by the number one on your telephone keypad.
Your next question comes from morning day here from Laurentian Bank. Please go ahead. Your line is open.
Good morning, congratulations on myself.
Hey, good morning.
Apologies.
The question is I'm, just trying to juggle back and forth and take notes, but just from that.
Residential side I'm, just wondering from mix or pricing versus volume I think last quarter. You had said it was two third person from one third.
Did you provide what it was this quarter on itself.
Okay.
So for Q4.
Pricing was really set I would say roughly 70% of the other increase because your question is with regards to Q4 correct.
Correct, Yeah, yes, yes, about 70% would be related to pricing year over year.
Okay, that's very helpful.
And then you had mentioned.
Growth in market share gains on the residential side just on your commentary offsetting a contractionary price environment in the future and just wondering if you had started to see any market share gains as of yet and I'm just thinking about your guidance for this segment and.
Higher a bit higher than perhaps home depot for example.
Wondering about the dynamics there.
Yeah.
So the.
The industry.
It's.
Partnerships, if you want.
In Q4 of every year. So right now we know our partners and we have an indication for their volumes for 2021. So to answer your question. So we we we do have relationships in place to be able to assist to support our assumptions on volumes.
And as far as we can tell so far.
The.
Did the actual pull on their inventory is following expectations.
Okay No that's helpful.
And just lastly on acquisitions I understand that you provided all the color in the last line of questioning but just size wise it should be the acquisition should be comparable to your prior.
Acquisitions that you've done historically for like 30 to 70 million in purchase price Slash my opinion on what would that be correct.
That's a fair assumption yes.
Okay, perfect and just in regard to the vertical day coal still kind of a priority for you guys.
Definitely a lot of opportunity in that window.
Yeah.
I guess priorities priority simply because theres more opportunities, but if something would come.
Railway tie for example, we know it would definitely be something we take a look at.
Yes, I would say the day.
More opportunities are with the other utility poles.
Okay. No that's very helpful. Thank you that's it.
It from me.
Thank you Mona.
We have no further questions. Thank you I'd like to turn the call back over to <unk> for closing remarks.
Thank you for joining us on today's call. We look forward to speaking with you again at our next quarterly call.
Yeah.
Ladies and gentlemen, this concludes today's conference call. Thank you for your participation you may now disconnect.
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Sure.
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