Q2 2021 Farmer Bros Co Earnings Call
Good afternoon, ladies and gentlemen, and welcome to the Farmer Brothers second quarter fiscal 2021 earnings Conference call. At this time all participants are in a listen only mode. Later, we will conduct a question and answer session and instructions will fall at the time.
If anyone should require operator assistance during the conference call Press Star then zero on your Touchtone telephone as a reminder of this call is being recorded.
I'd now like to turn the call over to your host today, Jeff <unk>. Please go ahead.
Thank you operator, and good afternoon, everyone. Thank you for joining farmer brothers second quarter fiscal 'twenty 'twenty, one the earnings conference call joining.
Joining me today is the borough of Macerich, President and Chief Executive Officer, and Scott Drake Chief Financial Officer.
Earlier today the company issued its earnings press release, which is available on the Investor Relations section of the farmer brothers' website at.
At Www Dot farmer Bros. Dot com the.
The press release is also included as an exhibit to the company's form 8-K and is available on the company's website and on the Securities and exchange Commission's website at.
At Www Dot FCC Dot Gov.
A replay of this audio only webcast will be available approximately two hours. After the conclusion of this call.
The link to the audio replay will also be available on the company's website.
Before we begin please note that all of the financial information presented is unaudited and the various remarks made by management. During this call about the company's future expectations plans and prospects may constitute forward looking statements for purposes of the safe Harbor provisions under the federal Securities laws and regulations.
These forward looking statements represent the company's views only as of today and should not be relied upon as representing the companys views as of any subsequent date.
Results could differ materially from those forward looking statements.
Additional information on factors that could cause actual results and other events to differ materially from those forward looking statements is available and the company's press release and public filings.
On today's call management will also use certain non-GAAP financial measures, including adjusted EBITDA and adjusted EBITDA margin and assessing the company's operating performance.
Reconciliation of these non-GAAP financial measures to their most directly comparable GAAP measures is also included and the Companys press release.
I will now turn the call over to the Pearl The World. Please go ahead.
Thank you Jeff.
Good afternoon, everyone and.
Thanks for joining us today.
We hope your families and loved ones are continuing to stay safe and healthy.
I want to first express my gratitude to the entire farmer brothers organization.
Because of them I can probably say that the supply chain and network optimization strategy.
Communicated over the past several quarters has now largely materialized.
All of that Scott discussed the financials in more detail I want to provide a few updates first.
The headwinds associated with COVID-19 continued to impact our business throughout the quarter ex.
Especially with and our DSD segment.
Which sells to restaurants hotels and casinos among other channels.
Over the past several months, we have seen our business respond rather quickly and both directions as the pandemic has progressed include.
Including renewed downturn tied to holiday time case searches and encouraging data following localized reopening.
Underneath all of this our fiscal Q2 results show improving rates of decline and the worst periods. So we remain cautiously optimistic that we're in a good position to recover as the country gets vaccinated and economic activity begins to normalize.
And the meantime.
We continue to apply a rigorous cost discipline as we have actively managed our SG&A expensive relative to volumes and continue to protect our liquidity.
Well, we can't control Covid.
We can control our execution.
And as such that's well I'll focus the balance of my prepared remarks today.
And the past of recap the progress against our five each turnaround strategy, but as we enter 2021, we've successfully executed the major essential items within those areas.
So my goal today is to paint a clearer picture of where we are regarding business optimization and where our next priorities lie.
I'll, then turn the call over to Scott to walk through the financials.
Our supply chain and network optimization strategy aimed to rebalance volumes across our manufacturing facilities and our national distribution network the.
And the process consists of three main steps.
One rebalancing of our Houston manufacturing facility, which has now led to its closure.
Two significantly improving our Dallas Fort worth facility and.
And three opening of new West Coast distribution Center.
Let me recap each step briefly.
We were again rebalancing, our Houston manufacturing facility, a few months ago.
And as of mid January of this year.
Production was ceased and the facility will permanently close at the end of May.
The facility was our oldest and most outdated manufacturing plant and given its proximity to our Dallas Fort Worth support center, it was underutilized inefficient and expensive to operate.
Simultaneously as we wound down our Houston operations, the began making improvements to our Dallas Fort worth facility.
We moved and reinstall the best equipment from our Houston facility added a brand new Neptune roaster to enhance our roasting capabilities and operationalized, new retail packing lines today.
Today, our Dallas Fort worth operation is and efficiently run state of the art manufacturing and distribution facility with an annual roasting.
The potential and packaging capacity capabilities of over 100 million pounds.
While currently this facility is not a full capacity we've doubled our output over the last 12 months.
The last step was establishing a distribution center on the West coast, where 40% of our customers are located.
And this week, we announced the opening of our brand New distribution Center and Rialto, California.
Which includes the refurbishing center for our coffee brewing equipment or CBE servicing business.
As of last week the facility open on schedule and is fully operational the.
And the facility will significantly improve delivery lead times for our customers and strengthen our west coast CBE business.
Further it will reduce Texas to California freight cost for our existing suppliers and provide us with further network optimization optionality in the future.
I want to pause here to provide a bit more color on our CPE business.
Which remains a core competitive advantage.
We both of the largest independent technical service operation and the industry with the new refurbishing capabilities, where we now have at our Rialto facility, we moved closer to many of our customers in the west and gain attractive incremental capex efficiencies by refurbishing more equipment instead of buying new.
It's worth noting that due to the reduced near term volumes associated with COVID-19, and many of the financial benefits of these initiatives may not become visibly apparent until later in the calendar year.
However, as volumes return, we expect these savings to scale.
Not to mention our customers will see benefits immediately and as such we expect Rialto to strengthen our competitive advantage and our western markets.
As we look forward to vaccinations workers, returning to work and volumes rebounding. We expect these synergistic efficiencies alongside the many other initiatives we've implemented during this time to meaningfully reduce our cost structure and accelerate our profitability.
Turning now to our ongoing initiatives.
The pandemics rippling effects of brought both challenges and opportunities, but havent deterred us from focusing on optimizing our business from the ground up.
Of course with continued integrating our distributed order management and ecommerce platform within our sales channels and expect these to produce incremental efficiencies and business opportunities. Once both are fully deployed.
We are also continue to test and integrate new technologies throughout our entire ecosystem. The most evident example, being hijacked.
Which is now fully rolled out to our DSD representatives.
Hi jump is a handheld device with sulfur featuring presale capabilities that perpetually analyzes our supply chain and optimize as Tom and cost.
As these initiatives come to fruition, you will see us increasingly refocus on growth opportunities and new ways to leverage our improved fixed cost structure and optimized supply chain.
As we move forward, our focus will shift primarily to the following three key strategic initiatives.
One, becoming a premier specialty distribution company to leveraging our internal and external contract manufacturing capabilities and three building upon white glove service quality and innovation capabilities.
So first let me address becoming a premier specialty distribution company. One way. We are doing this is true partnerships that utilize capacity.
Leverage our current distribution network and expose us to new industry innovation.
We recently announced our distribution partnership with hybrid.
And the innovative leader and the ready to drink co grew market.
The fast growing niche, especially among younger demographics.
We're excited about this partnership future as high Brew has a terrific innovation pipeline and can ultimately expand our market opportunities.
Before that we announced our manufacturing partnership with Newsy, another innovative company with strong brand recognition throughout Asia. That's now looking to establish the U S presence.
Secondly, we will continue to leverage our network to become a contract manufacturer for both our institutional foodservice and retail channels.
We are also making progress on longer term initiatives that can leverage our new infrastructure, such as omni sales channel integration.
The channel sell fewer.
Future innovation and strategic growth within our direct ship business.
Historically, we've utilized a multichannel sales approach, but as we continue to optimize our business and integrate new technologies were increasingly finding attractive crossover opportunities and synergies.
Some of the most of parent cross channel opportunities lie within our broader E Commerce strategy.
Two quarters ago, we adopted and began integrating some of our businesses with a full service retail and E Commerce platform.
The first brand we launched was boards, although we face unique challenges and the initial implementation phase the sot ultimately launched successfully and continues to receive strong retail traffic today.
The process taught us a lot about ecommerce and legacy channel integration. We now believe we have a replicable model, which we've since leverage to launch another ecommerce site for a public domain brand and expect to launch another for China Mist later this year.
We continue to look for other innovative revenue opportunities within our E Commerce channel such as subscription based service models.
Which both newly launch sites now offer.
Further as we make iterative improvements to our system, we look towards broader E commerce integration opportunities and the future.
Including the launch on our very own Farmer brothers E Commerce website, and one for our CPE business.
Other opportunities within our E. Commerce channel are currently being tested such as our <unk> E Commerce platform, which offers increased flexibility to our Roche who direct customers.
Turning now to our third strategic initiative.
Which is building bond white glove service quality and innovation capabilities.
And as we look forward innovation remains a core commitment of farmer brothers.
With our foundational structure now in place.
We're excited to get back to the lab.
Similar to the agreements made and our recently announced partnerships our ability to create innovative new products under our wholly owned brand names and pilot launch them via our National DSD network provides cost effective optionality with an attractive risk reward profile.
Many of these opportunities provide attractive upside with little downside.
A strategy, we intend to continue to utilize as we create future growth opportunities for ourselves with little upfront capital investment.
So to wrap up.
We're continuing to and have already made significant progress on our broader turnaround plan.
While we have executed the main initiatives within our supply chain optimization strategy co.
<unk> and the Rialto facilities opening we still have work to do.
Nonetheless, these initiatives completion March and the inflection point that escalates, our focus on growth initiatives.
We are cautiously optimistic that our timing is right as recovery from the pandemic becomes a positive glimmer on horizon.
I look forward to keeping you posted on our progress and the future and will now turn the call over to Scott.
Scott.
Thanks deferral during the three months ended December 31, 'twenty and 'twenty, we experienced sales declines and our DSD and direct ship sales channels compared to the prior year period as both channels continued to face ongoing headwinds related to COVID-19.
Despite these declines we experienced sequential sales growth of seven 5% from the first quarter as our DSD channel saw improving conditions until the COVID-19, resurgence and our direct ship business experienced some seasonality benefits.
Until the resurgence of cases and reinstated locked down on the California experienced this quarter, we saw consistent month over month improvements and volumes.
This momentum continued through September where our weekly sales improved to a decline of 32% from of pre COVID-19 levels.
Representing continued progress compared to the 44% decline we saw in June and the 65% to 70% decline we saw in April.
And if not for this new wave of cases, we believe the trajectory of rate improvement would have continued throughout the current quarter, but ultimately we ended the December quarter with DSD volumes down 40% compared to the prior year period.
As a result of the lower volumes, we experienced the lower gross margin.
Then in the prior year quarter.
Our gross margin decreased by three 7% to 25, 1% compared to 28, 8%.
While our improved cost structure within our cost of goods sold offset some of the contraction of our higher margin DSD business was primarily responsible for the decline as our direct ship business largely remained stable.
We posted a net loss of $17 $7 million and the quarter compared to a net income of $7 $8 million in the prior year period.
This figure includes a $13 7 million dollar of noncash tax expense associated with the gains on the postretirement medical plan and the previous years.
More information on this tax expense can be found and the accompanying earnings press release and more details will also be found and the 10-Q to be filed shortly.
Our EBITDA was $5 3 million compared to $16 $9 million and the second quarter of last year.
And our EBITDA margin was five 1% compared to 11, 1%.
Adjusted EBITDA and the second quarter of fiscal 2021 was $8 3 million compared to adjusted EBITDA of $7 4 million and the prior year period.
Included in that $8 3 million dollar figure as of $7 2 million dollar amortize gain from the post retirement medical plans curtailment and March 2020.
The amortization of this medical plan gain has now ended with the sunsetting of our retiree medical plan effective December 31 2020.
Our adjusted EBITDA margin improved to seven 9% during the quarter compared to four 9% and the prior year period.
As a reminder.
EBITDA EBITDA margin adjusted EBITDA and adjusted EBITDA margin are non-GAAP financial measures you can find a reconciliation to the comparable GAAP measures at the end of the Q2 financial press release, we issued earlier today.
Overall, the operating expenses benefited from cost savings actions taken due to the pandemic and cost controls implemented over a variable spending as we rightsize, our SG&A expenses against volumes.
However, compared to the prior year quarter, our operating expenses increased slightly.
The increase was primarily due to a $9 $9 million decrease and net gains realized from asset sales and of $1 2 million dollar noncash fixed asset impairment charge.
Offset by a $10 $1 million decrease and selling expenses.
The $9 $9 million decrease and net gains from asset sales was primarily due to the sale of two branch properties at a net gain of $1.2 million during the current quarter.
Compared to the prior year quarter asset sales, which included the sale of our Houston manufacturing facility and four branch properties, representing total gains of $11 $4 million.
Also included and that operating expense figure is a small increase and administrative expenses, which was primarily associated with a onetime severance cost and other strategic cost savings actions, partially offset by reductions and third party costs and head count.
The execution of the optimization initiatives. The deferral spoke to is expected to result in meaningful cost savings for the company.
While we will benefit from some of these cost savings immediately such as those from our Houston closure and West Coast distribution Center opening.
We expect the synergistic efficiencies of all the improvements made throughout the pandemic to scale with volumes as they recover.
In other words, we believe the cost structure of the business will be fundamentally different as we emerge from the pandemic.
As such we will be well positioned for margin expansion as the environment normalizes.
For the six months ended December 31, 2020, our total capital expenditures were $9 $6 million and consisted of $3 7 million and capital and maintenance spend.
And $5 $9 million and capital investment spend which was needed to fund our optimization initiatives.
We expect our capital spending will be lower and the second half of the fiscal year as the most capital intensive projects within our broader turnaround strategy are now completed.
The $3 7 million of maintenance spend represents a near 50% reduction compared to the prior year's six month period.
Driven by several initiatives put in place, including a focus on our refurbished coffee brewing equipment business.
Our revolvers outstanding debt was $82 million at quarter, and a decrease of $40 million since June 30th 'twenty and 'twenty.
Over the same time period, our cash balance decreased from $60 million to $5 9 million.
These changes resulted from the repayments on our revolver completed under the terms of our amended credit facility.
Our debt less cash at the end of Q2 was $76 million representing.
Representing an increase of $17 million from Q1, and an increase of $14 million from the June period.
This use of working capital was primarily due to a decrease and our cash position as we built out of inventory and.
And increase in our capital expenditures needed to optimize our footprint and.
And the pension contribution made in December to catch up on payments that were deferred under the cares Act.
The inventory.
Tori investment was needed to better position us for and anticipated recovery and the back half of the fiscal year.
As Covid unfolded last spring, we made aggressive inventory cuts.
As a result, when recovery picked up more than anticipated in the summer months, we were caught a little short on inventory, which is the mistake, we wont let happen again.
Given these changes we ended the quarter with total liquidity, including availability under our amended revolver and cash on hand of $43 million.
Which is down slightly from $44 million in Q1.
This again was due to the revolver repayment investments and inventory increased capital expenditures and pension funding requirements.
Despite the slight decrease we still believe we're in a strong liquidity position to execute our future growth initiatives.
Overall, we're pleased with the progress we've made despite the challenges faced relating to the pandemic.
While we expect some volatility to continue and the near term we remain optimistic about a recovery and the long term as vaccinations and reopening and progress on.
Until then we'll continue to manage our expenses protect our liquidity and further optimize our business.
We're proud of the progress we've made so far within our broader turnaround strategy.
We firmly believe that the company is poised to show performance improvements and the back half of our fiscal 2021 year, especially as volumes recover.
With that I conclude my prepared remarks, and we'll now turn the call over to the operator to take your questions.
Okay.
Ladies and gentlemen to ask a question. Please press star one on your telephone.
To withdraw your question press the pound key.
And I would like to ask a question.
Star then the one key.
The tone telephone.
One moment, while we compile the Q&A roster.
Our first question comes from Kara Anderson with B Riley Securities. Your line is open.
Hi, good afternoon.
Hello, Kara here.
I'll start with and easy.
On the housekeeping and quarterly housekeeping question here.
Okay.
The sales is that correct.
Thank you.
Absolutely. So the number for the quarter is 66, 4% of roasted coffee as a percent of total sales and the year to date number is 67, 2%.
Great. Thank you and then.
Inventory investment you made in the quarter and.
Are you.
Or should we expect further investments needed to sort of position yourself for the recovery.
Yeah, we feel good about where we are with inventories at this point and obviously the the balancing between you know the coffee and the Allied products is a lot of what we're doing and we feel good about where we are we'll obviously, our we do monitor it week to week based on what we're seeing in the marketplace and we just want to make sure because of lead times on some products.
That are where we're staying and a good place with that so as we see this recovery as we see markets open again, we'll be keeping a really close eye on it but we think we're in a good place.
It's the hot topic around the office.
[laughter].
And certainly in the time that you think the phase of recovery on the horizon.
And.
And then I'll move on and off line.
Fine.
With the rise in cases, particularly here in California, and ultimately the check on here.
Did you make any adjustment and kind of with the goal.
The first of all of them on the progress and the.
The weekly sales thank you.
Quarter.
Say that question of woman and Todd.
I missed the back half of it in terms of the coverage in the quarter.
I'll just replay that for you.
He made any adjustments to the organization or and your cost.
The result of thing going from Downs and Super.
Okay, I got it yes, and and we did see a decline as the quarter progressed and since then as the vaccinations over the last several weeks, we've seen an uptick and we're seeing that same pattern. We saw if you remember back during the July 4th period.
At the same time of the effect November December had.
And we're seeing it.
Reverses the same course and followed the same trend that we saw previously I think what we're trying to anticipate here is how fast with the new administration and the vaccination program, that's going across the country and.
And governors seem to be relaxing and maybe not everyone. Following a 100% of the guidelines and more people.
Pack into outdoor dining or.
Indoor dining just timing those orders and making sure we're ready for that volume and from that perspective to your direct question Scott and.
In terms of the percentages that we've been reporting and then kind of how it ended up in the quarter Yeah, Yeah fluids deferral is the.
Recurrence of Covid cases happen and Youre right and in Q1, you can kind of think of Q1 as being a little bit better month to month to month and I would say that end of September when we were reporting the DSD business down 32% to prior year to pre Covid that was kind of of the peak and then it started to regress a little bit and October.
And then it was interesting because as we saw Covid reached new heights, and all regions of the country of.
Obviously, the case count the hospitalizations the closures and actions that were taken were far more severe than we've seen before.
In mid November we obviously had a deterioration in our DSD sales, but we hit this level of about 40% down to prior year and or to pre COVID-19 levels and we really stayed there it didn't get any worse as we move through November and through December and early January we really found kind of a I guess the near term floor that the down.
40% level and as deferral said where were nice to see it starting to move up from there.
On the positive direction.
Got it.
And then.
Good day.
Previously you've talked about.
David.
On the brewery and equipment.
And can you remind us of that and I think of.
The pilot.
And just provided an update there correct me if I'm wrong.
Yes, it was a non branded service tech in Texas, and the fortunate thing and Scott <unk> and the key executive leading that effort, so I'll turn to him to.
And let you give a quick updates of some of the results that we've been seeing yeah, absolutely absolutely a lot of what we've been doing is the foundational groundwork. If you can imagine the back office work of making sure that we could actually it's the services provided to our current existing customers for years at no charge. So you've got to come up with the revenue.
And the billings and the invoicing and all of those different things that we would need as well as the service level agreements that we will be offering people at different levels. So a lot of that foundational work is now nearing completion and what we're finding is that as you go look to maybe manufacturers the partner with them and others that the the.
The lack of the timing I guess of the restaurant business and the restaurant recovery will be key to that business as well. So we're kind of moving the round a little bit and talking with a lot of different parties, but we have started having some actual service calls and some work around that and really really good discussions with a lot of different parties. So we think we'll be able to provide a meaningful update on that and I hope.
The next quarter, but it is moving and the right direction and we're kind of done with the groundwork phase and we're really moving now into starting to execute.
Great. Thank you that's it for me.
Thanks Kara.
Thank you we have a question from Gerry Sweeney with Roth Capital. Your line is open.
Good afternoon, and several Scott Thanks for taking my call.
You bet the lojack.
On.
And I wanted to touch upon the.
The comment around the premier specialty distribution of.
Obviously, great DSD network right sort of distribution and wondering if you could maybe expand on maybe what the opportunity is there.
You mentioned hybrid.
Thank you.
Would be and opportunity to leverage that.
The network.
The other things that you haven't mined or maybe a little bit.
And more details you could provide on what you are.
Steve.
That's true I think thanks.
Thanks for the question, Gary I think you hit on it.
In terms of leveraging the platform.
But no question. The farmer brothers has built this platform over 109 years and the GSE side and.
There's a lot of products that are on trend and in fact, we don't sell the coffee for customers. So if I think about a coffee forward.
T and spies type account.
And as more premier specialty type products that we could sell in that network now.
Not to date.
And you look at some of the products that we don't have and you ask yourself why.
We're not putting some of the high end.
Non dairy replacement products, such you've got oat milk or almond milk soy milk and the like that's a huge opportunity and in fact, if you go to most.
Locations across the country, the or coffee forward you'd find us not playing in that and we're in conversations with individuals around those types of products just as we learned heavily from our initial hybrid of discussions that we've always known that we needed to be and the RTD space, but didn't want.
To spend the capital and in terms of <unk>.
Innovating those products because there was really good companies out there that did that so.
Leveraging our network, especially in institutional foodservice as the initial step forward with companies like high Brew and then looking for other opportunities. So.
There are other types of products that we do sell today that are gaining popularity and we could get into the whole category around the sweeteners of all types of especially agave.
Other types of.
Sweeteners that we could have brought on and our network and today, we have the typical traditional colored packets and raw sugar and frankly, if you go to a typical coffee shop youre going to find a lot more progressive types of things that consumers are asking for and we know we have the network by which to deliver.
And those so we're constantly out there searching for partnerships that make sense to leverage on top of the robust platform that farmer brothers has built over the course of channel.
Got it that's helpful and then I am not sure how much you can answer this but obviously you've made a lot of changes.
It accelerated some of the changes Houston West Coast distribution.
Could you sort of co.
Quantifying how much expenses taken out of the model because of the past year.
Well as you know we don't provide guidance at this point, yet, but I will commit to both care and you and others that as <unk>.
Covid stabilizes, we absolutely plan to get on a path of giving you some cost savings inputs around guidance and also margin.
And I expect to do that.
I would hope that we might be able to do that by fourth quarter call. I think third quarter call is going to be a little challenged because we'll still be navigating through COVID-19, but with that let me give it to Scott because he can give you some updates on things we have discussed as it related to COVID-19 and cost savings.
And then I think the bigger question that you're asking for is one we've got to move toward and that is of much harder thing to do right now since much of our success has been covering the downturn due to COVID-19 and we got a lot of moving parts, but I think Scott's got a means by which to give you a little sense of that and just showing the kind of.
Where it is without formally going down this path of giving guidance at the sour So Scott got it.
Thanks, Gerry what I would say is a couple of parts here I'll give you one is on cost savings and if you look at the quarter. Just ended I know that we talked early on when and when Covid first broke about having an internal goal of saving six and a half million dollars per month, and then we talked about how we had exceeded that goal and it's tough to see.
Times, because you know about a third of those savings are in our margin number and cost of goods and about the other two thirds are down and our operating expenses, but if you just look at the the gross margin you know the first quarter gross margin. We reported was 23% the second quarter. The quarter just reported was 25, 1% yet the sales level to.
Prior year were both very similar down 30% and down 31%. So you see some of that the progress in cost of goods there and I can also kind of just tell you directionally that for the quarter. We just ended we've obviously brought back a lot of the business from from Q4, when Covid was really at its peak.
And so some of those expenses are back, but we're still running at a rate just below about $6 million a month on cost savings. So hopefully that kind of gives you a framework on cost savings.
Now thinking of cost savings going forward and the West Coast D C and the Houston facility and and all the other things we've talked about.
And as the real said, we hope to get things to a more stable level and as we talk about a little bit and the release of lot of those savings, especially out of D. C and out of manufacturing facility. Our volumetric so the more volumes and we put through those facilities of the bigger the savings are but I would I would just caution you not to look for a big difference in Q3.
As we move forward just a lot of obvious reasons. There. It's Q3 as this first quarter for both facilities. It's also the quarter. We've got the final transition of both facilities and the United as anyone knows of kind of obvious moving rep. You are winding down of production facility and youre not at high efficiency, starting up new production and a new place.
Similar so Q3, it sounds like we're going to take a big step back, but youre just not going to see I don't think of big difference. There. We think however in Q4, we've also gotten through a lot of you know we captured a lot of production variances and we recognize those and the next quarter. So from Q2, we will recognize some in Q3, so you'll really get a clear picture of some of these facilities.
And their impact at current levels at least when we get the Q4 and Q1 and and that's where I think you had the Earl and I will work hard to give you some more clarity on that.
That's really helpful. I mean, just.
Some of the cost savings and sort of targeted.
Targeted before and just understanding and.
Net.
Houston.
Going down and northlake running on.
And that's not always plenty of on theirs.
Little bit of of a learning curve.
Very helpful. So I appreciate it.
I'll jump back of my index right.
Thank you.
Thank you.
And there are no other questions in the queue I would like to turn the call back.
Sure.
And for any closing remarks.
Thank you.
As we continue to navigate the COVID-19 environment, we will continue to prioritize the health and safety of our team members and our customers as well as take actions as we've been taking over the last many months to support the long term sustainability of our business.
And we're very.
Confident right now as we look forward to the recovery and the vaccinations and seeing people come back to work.
We have everyone working remote at this point the and it can work remote and we are confident and our strategy and believe the actions, we've taken and will put farmer brothers and the position of strength within the nation of the country emerges from the state of crisis and we appreciate each of you joining today and thank you for your continued into.
And farmer brothers.
Ladies and gentlemen. This concludes today's conference call. Thank you for participating you may now disconnect everyone have a great day.
Okay.
Yes.
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