Q4 2020 Aziyo Biologics Inc Earnings Call
Ladies and gentlemen, thank you for standing by and welcome to that and vivo Biologics fourth quarter 2000, and 'twenty earnings Conference call.
At this time all participants are in a listen only mode. After the speaker's presentation. There will be a question and answer session to ask a question. During the session you will need a press star one on your telephone. Please be advised today's conference is being recorded.
You require any further assistance. Please press Star then zero I would now like to hand, the conference over to one of your speakers today Hunter Kabi. Sir. Please go ahead.
Thank you and thank you all for participating in today's call.
Joining me are Ron Lloyd Chief Executive Officer, and Matt, Bruce and Chief Financial Officer.
Earlier today as they are released financial results for the fourth quarter and full year ended December 31, 'twenty and 'twenty a copy of the press release is available on the company's website.
Before we begin I'd like to remind you that management will make statements. During this call and include forward looking statements within the meaning of the federal Securities laws.
She went to the safe Harbor provisions of the private Securities Litigation Reform Act and nine.
And 95.
Any statements contained in this call that do not relate to matters of historical fact relate to expectations or predictions of future events.
And for performance are forward looking statements.
All forward looking statements, including without limitation those relating to our operating trends and future financial performance the impact of COVID-19 on our business and prospects and recovery.
And its management expectations for hiring growth and our organization.
Asian market opportunity guidance for revenue gross margin and operating expenses commercial expansion and product pipeline development and expected future product launches and milestones and <unk>.
<unk> results and performance of our partnerships and commercial products, including patient outcomes are based on our current estimates and various assumptions.
These statements involve material risks and uncertainties that could cause actual results or events to materially differ from those anticipated or implied by these forward looking statements.
Accordingly, you should not place undue reliance on these statements.
For a list and description of these crews and uncertainties associated with their business. Please repurchase the risk factors section of our public filings with Securities Exchange Commission, including our quarterly.
Quarterly report and form 10-Q for commodity period ended September 30th 'twenty and 'twenty.
This conference call contains time sensitive information and is accurately on the of the Y Broncos today March burst 2021.
As your biologics disclaims any intention or obligation, except as required by law to update or revise any financial projections or forward looking statements, whether because of new information future events or otherwise.
Also during this presentation, where we refer to gross margin excluding intangible assets.
And that amortization, which is non-GAAP financial measure.
A reconciliation of this non-GAAP financial measure to the most directly comparable GAAP financial measure is available on the company's earnings release for the fourth fiscal quarter and full year ended December 31, 'twenty and 'twenty, which is accessible on the SEC's website and posted on their best Investor Relations page of the abuse website at www.
Dot dot com.
And with that I'll turn the call over to Ron.
Thanks, Hunter and good afternoon, everyone and thank you for joining us.
Today marks our second earnings call as a public company following our IPO last October.
Undoubtedly 'twenty and 'twenty was an extraordinary year, but the Seo team has continued to make meaningful progress on our mission to provide advanced regenerative medicine products to improve the outcome and patients undergoing implantable device related surgery.
Our products are designed to reduce the complications associated with implantable medical devices.
We do this through our unique unique and proprietary platforms based on our deep understanding of the science related to the cells.
Growth factors and the structural matrices to best optimize our tissue products.
Our core product platforms address three primary markets and.
Quite a electronic devices, such as pacemakers defibrillators.
Bone repair and orthopedic and spine procedures.
And soft tissue reconstruction.
Additionally, we fulfill tissue processing contracts to our Richmond, California manufacturing facility as a highly leverage able component of our business.
And my prepared remarks today I'll cover our recent highlights and accomplishments.
And to provide our current view of the market and priorities as we enter 2021.
And Matt will go into more detail on our financials and guidance and then we'll open up the call for your questions.
And 'twenty and 'twenty, we made considerable progress bringing to market multiple new products.
Including Asti grow V and VI Boe multiple.
We also advanced our pipeline products, most notably completing a feasibility study to achieve targeted antibiotic free lease for a kangaroo envelope.
And initiating new clinical studies to demonstrate the benefits of our products.
We also expanded our commercial organization and strengthen our partnerships with leaders from the industry.
Such as Boston, scientific and Medtronic and bio tronic.
Late in the year, we expanded our channel reach through a breakthrough technology contract with Premier.
Granted access to our CAGR envelope to more than 4000 hospitals, and 200000 and other providers in the United States.
We also broadened our leadership team and.
And Matt as our CFO and Dr. Jerry Rubin as our CMO and.
And we added two new board members with deep experience and the health care sector.
Hey, Bob Jordan and Bridget mix.
And of course, we completed our IPO, which secured the funds that will enable us to continue to disrupt the 3 billion dollar regenerative medicine space.
Turning briefly to our recent financial highlights during the fourth quarter.
D O team once again gross the challenges of the current environment.
And we're living revenue of $12 5 million or.
Three per cent increase over the fourth quarter of 2019.
And a 6% increase over the third quarter of 'twenty and 'twenty.
Core product revenue was $10 3 million.
Representing a 10% year over year increase.
For the full year, our core product revenue grew 17% year over year.
Quite an accomplishment considering the business challenges of COVID-19 throughout much of the year.
Turning to our business highlights we finished the year strong and have recently announced meaningful progress on a number of key initiatives that give us even greater confidence and our market opportunity and our differentiated regenerative medicine portfolio.
Starting with our products address the market for implantable electronic devices and opportunity. We believe represents $600 billion with around 600000 procedures performed in the United States and 2019.
We have recently met a number of important milestones.
Our primary solution for device related complications and this market is kangaroo.
The only commercially available biological envelope.
And as a natural systemically vascularized pocket for holding and portable electronic devices to regulate the healing response and stimulate the formation of healthy tissue.
As a reminder, our go to market strategy and includes a mix of direct sales and commercial partnership agreements with Boston scientific.
And bio tronic.
Which adds support from their more than 1400 sales professionals.
This blended approach has served us well, especially throughout the past year.
Or hospital access was limited and we benefit from our partners broad relationships and access to key medical centers.
Our direct sales force and there's also remain productive and.
And we are encouraged by the recent progress made and on boarding new reps.
At year end 2020, our sales organization dedicated to this market included 28 reps.
Our plan is to selectively continue to add sales headcount throughout 2021.
With hiring target that more heavily weighted towards the second half of the year as we approach additional development milestones with our pipeline program of adding antibiotics the kangaroo.
As noted earlier, the breakthrough designation with Premier, which significantly expanded the market for Kangaroo in the United States became effective December one 2020.
We are pleased with our early progress and obtaining contracts within premier accounts.
And now have several new ordering and accounts as a result of this partnership.
We look forward to the valuable contribution this relationship can make and broadening our reach as enables us to accelerate our commercial traction and gifts kangaroo additional validation for.
The value and safety it offers patients.
We recently announced free more exciting developments for Kangaroo.
First we received CE Mark approval on January <unk>.
I think the label instructions for Kangaroo to include hydration with antibiotic jump and myosin.
This approval is important and then it further differentiates kangaroo is the only natural biologic envelope on the market to also include the potential to reduce post op infections with an antibiotic solution.
We are very pleased to now be able to deliver this enhancement to European customers and patients.
In addition, we were delighted to complete the product design for the next generation Kangaroo envelope.
And this effort, we partnered with Cook biotech to advance the platform.
Which will be enhanced by adding the antibiotics were famine administer cycling.
We remain on track to achieve manufacturing validation followed by data collection through in vivo and in vitro studies.
We look forward to updating you with our progress our goal remains to prepare the kangaroo with antibiotic data for FDA submission and Q1, 'twenty and 'twenty two.
With product launch anticipated in the second half of 'twenty and 'twenty two.
On the clinical front, we recently announced the first patient enrolled and a study to investigate the biologic and clinical effects of adding envelopes.
They surround cardiovascular and point of electronic devices or Cid's.
Time of implantation surgery.
The seal study is a multi center study and the United States of 100 patients who previously went implantation of a C E D.
The CAGR envelope Medtronic.
Medtronic tie Rex.
Arnaud envelope, who have had their implants for at least a year and a returning for a change out revision procedure.
This study focuses on Dan if I and characteristics of soft tissue healing around the implant using tissue biopsies taken at time of change out.
On a procedure from.
Patients treated with or without an envelope.
Time of device and plantation.
We believe this study has the potential to validate the significant contributions that our kangaroo envelope can provide to patients.
Now turning to our next product group and market, the orthopedic and spine repair market and estimated $2 billion market opportunity with approximately $1.5 million and orthopedic and spine repair procedures using bone repair and materials.
Our product platform and this market consists of fiber cell.
By bone and nasty grow V.
And January 'twenty, 'twenty, one and one of our partners and this market surge of Lion holdings.
Announced the commercial launch and first completed surgery, using by bone and multiple which we supply the surge aligned.
In addition, we continue to work with our partner and Medtronic to expand fiber cell revenues by generating additional data on the product's performance characteristics.
And lastly, our third product group of market soft tissue reconstruction.
We estimate this to be a $500 million market opportunity with roughly 100000 procedures annually using human dermis.
Complications arrive when native tissue, it's not substantial enough to repair the area from the original procedure.
Our simple derm product is manufactured through a patented process that the failure arises enables the products be more closely resemble natural occurring tissue.
We are working on building product awareness and clinical evidence as well as expanding market access.
Effective today March 1st simple there will be on contract with the healthtrust purchasing group.
Healthtrust member facilities represent more than 600 hospitals and health systems across the United States.
We are continuing to see strong growth of this product through our direct sales organization and distributor partners.
And physician customers are providing positive feedback on the performance of this offering.
In summary, we've made substantial progress advancing our core product platforms and pipeline, while in parallel driving topline growth.
Turning to our contract manufacturing business, where we offer tissue processing for a range of third party health care companies.
<unk> began to see the benefit and the fourth quarter of several new contracts and.
As a result expect this business to return to stable more predictable growth.
Overall contract manufacturing, while not a core part of our business has.
Has the potential to positively augment our growth.
It is also quite efficient as it leverages available capacity and our manufacturing facility and <unk>.
Contributes positively to our bottom line.
The additional revenue is also a good source of capital to further drive growth and our core product platforms.
As we enter 2021, we believe we are poised for another year of strong growth across all product lines.
Although the start of Q1 has been presented challenges due to COVID-19 and extreme weather across much of the country. These headwinds appear to be dissipating and we.
And we're optimistic about improving macro environment as we move through the year.
We're very excited about the milestones, we recently achieved and our potential for sustained revenue growth.
And that can result from our on market and pipeline products.
We believe that as we continue to penetrate our target markets and realized returns on our investments and new technologies.
And and expanded commercial presence, we'll see those initiatives benefit growth and our core products.
Our priorities are unchanged and as such.
We will remain focused in 'twenty and 'twenty one on first the development of our next generation Kangaroo product second <unk>.
Continue to launch new and enhanced ortho biologic products.
Three generating additional clinical data for our core products.
For expanding our direct sales organization for Kangaroo and simple.
And finally continues for opportunities to add synergistic products through partnerships or acquisitions.
In summary, we've been able to accomplish quite a bit and a very short period of time and we're very confident we can continue to build on that momentum.
Moreover, we believe we are continuing to advance our vision to establish our differentiated and proprietary products as a standard of care for treating patients undergoing a wide range of implantable device related procedures.
With that I will now turn the call over to Matt to provide a review of fourth quarter results and outlook for 2021.
Thanks, Ron as mentioned net sales for the three months ended December 31, 2020 were $12 5 million, a 3% increase from the $12 $1 million and the same period of the prior year.
Included a 10% increase and sales of core products, partially offset by an 18% decline and our non core products.
Our top priority is the continued growth and our core products. We were pleased to see our contract manufacturing business achieved its best quarter of 2020.
As a result of several recently signed contracts that are driving performance in this area.
Gross margin for the fourth quarter of 2020, with 48% as compared to 41% and the corresponding prior year period.
We also look at gross margin, excluding the impact of noncash amortization of intangible assets and on that basis, Q4 would have been 55% versus 48% from the year ago quarter.
The increase in gross margin in Q4, 2020, primarily resulted from growth and our higher margin proprietary products and improvements in production and inventory management.
Total operating expenses for the fourth quarter of 2020 were $10 million or 23% increase from $8 $1 million and the fourth quarter of 2019.
The increase primarily resulted from costs related to operating as a public company and development costs associated with our program to add antibiotics to our Kangaroo envelope.
Loss from operations was $4 million for the fourth quarter of 2020 as compared to $3 $2 million.
On a loss of $3 2 million for the year ago quarter.
Net loss for the period was $5 $4 million as compared to a net loss of $2 $8 million and Q4 2019.
Loss per share and the fourth quarter of 2020 with 57 cents.
Compared to a loss of $4 30 per share and the year ago quarter.
We ended 2020 with a cash balance of $39 $5 million.
And we now have approximately $10 2 million shares of common stock outstanding which for the fourth quarter of 2020 translated to nine 4 million weighted average shares based on our IPO closing and the month of October.
Now turning to our full year full year results net sales for the full year 2020 were $42 $7 million and 1% decline compared to our full year 2019, net sales of $42 $9 million.
Gross margin for the full year, 2020, with 48% as compared to 46% and 2019.
Excluding the impact of noncash amortization of intangible assets gross margin would have been 56% and 2020 as compared to 54% in 2019.
Total operating expenses were $34 $2 million for the full year compared to $28 $2 million and 2019.
Net loss for the full year was 28, $21 8 million, which compares to $11 $9 million in 2019.
Loss per share for the full year, including the accretion of deemed dividends to preferred stockholders was $8.88 compared to $18 and 48 and 2019.
Turning to our outlook for the full year 2021.
And <unk> by the traction we've continued to make as we enter the first quarter. However, we expect the lingering impacts from COVID-19 to be a headwind until the vaccine is more widely available and hospital surgical volumes and access returned to normal.
Nevertheless, we are confident and our overall growth trajectory and as such and expect revenues for 2021 to range from 50 to 50 $52 million representing growth of 17% to 22% over 2020.
And with that we'd like to open the call for your questions.
Ladies and gentlemen, if you have a question at this time. Please press Star then one on your Touchtone telephone and your question has been answered or a western love yourself from the queue. Please press the pound key to prevent any background noise. We ask that you. Please place your line on mute. Once your question has been stated.
Our first question comes from the line of Josh Jennings with Cowen. Your line is open. Please go ahead.
Thank you this is Eric on for Josh.
Just think about the guidance range that you offered here how should we be thinking about the breakdown core versus noncore.
Revenue growth and in the guidance how are they contributing to that 17% to 22% and as part of that question. What assumptions are you guys, making for elected procedures and window returned to normal are you thinking that's two Q this year or maybe second half of the year any detail there would be great. Thanks.
Thanks, Let me start out with the first part of that question and then I'll have Matt also comment related to some of the surgical volume projections. So again, we're excited about our core product business and as we reported it grew 10% in Q4 and somewhat of a challenging environment as we know that uptick and <unk>.
Of Covid and at the end of Q4.
As we look forward here for 'twenty 'twenty, one as we've given guidance here and the range of 17% to 22% across our businesses. We actually think that we're going to continue to see very strong growth of our core products, but we're also going to see a return to growth of our non core manufacturing contract manufacturing business.
And I think when we look at it collectively for the year, we're probably anticipating similar growth rates for both the core products and the non core products for 2021.
Yes, Eric I would concur with all of that and I would just add that we do expect.
And our business has some seasonality where Q1 is generally a little bit lighter than say Q4 and so.
Thinking about the sequential comparisons there.
And.
And how revenue will grow as we move through the year and.
And I agree with Ron and we do well and longer term, we expect more growth and I'm talking about longer term beyond 2021, we expect more growth to come from our core products.
And in 'twenty, one as were rebounding from a lower year with our contract manufacturing business.
We expect that growth rate probably to be on a similar range to what we see with the core product. So.
Hopefully that's helpful. Let us know if your M&A path.
Great. Thank you that's definitely helpful and then thinking about your pursuit of clinical data here.
You recently announced the first patient enrollment for heal and use some other studies like care plus continuing to move forward.
We're just wondering how impactful do you think these datasets will be once they hit and driving stronger adoption and utilization trends.
Sure. So we want to make sure that we're collecting the clinical data that shows the differentiation of our products and the benefits of our products can bring forth to patients.
Again, and reducing complications and associated with implantable medical devices.
And so we've embarked on a number of studies.
You've mentioned the heel study and we just announced the first patient enrolled in this study. This is a multi site study with the United States to collect patients around 100 patients that have received.
Kangaroo.
Or tie Rex from Medtronic, where no envelope at all and at time of change out look at histology.
And look at the day pocket itself and the hiltons and the pocket and complications that arise from having fibrotic tissue at a time of change out and so we're excited to embark on this study we believe it will demonstrate the benefits of having a biological antelope and the remodeling benefits of reducing cash.
Complications associated with scar tissue.
And so we're pleased to have this study up and running and the first patient enrolled and.
And likewise the care plus study as a single site looking at patients that received Kangaroo director or no envelope and such.
Short term study and we look forward to seeing the data from that study probably and the second half of this year as it looks at some of the short term complications of putting in.
Envelopes related to treating patients with Cid's. So we believe it is important to make these investments and show the clinical differentiation and again, we're hearing anecdotal feedback from doctors that see the benefit of fan growth, reducing complications by having a biological solution and a healthy pocket and we want to make the investments to collect that same data clinically to have and.
Eligible to be available to promote two two to two doctors and as it relates to our products.
Yes.
Excellent I appreciate you guys hit and the questions.
Thank you and our next question comes from the line of Matthew O'brien with Piper Sandler. Your line is open. Please go ahead.
Good afternoon, and thanks for taking the questions I guess and just to be clear on the guidance either matter on youre, saying, 17% to 22% growth from both core and non core this year is what we should be expecting.
Yeah, and generally in that range.
For 2021, and what we're talking about okay, well the reason I'm asking that Matt is that you've obviously got an easy comp on non core but it implies a little more strength on the core side of the business, which is a key for you guys and.
And even even in the face of Covid. So I was just hoping to hear and little bit more about some of the strength that you're calling on now that you hadn't seen maybe this time last year I don't know assets that help trust arrangement or premier or what but just you know where that incremental.
Confidence and the core businesses come and from an idea and one quick question for you Matt.
Sure. So let me start.
And again, we were pleased last year with the core products and and collectively for the year they were up 17%.
And as we think about our business as we continue to build momentum.
You've mentioned the expanded market access with the breakthrough designation that came in December one of last year for Kangaroo and again, we're very excited about that we're pleased with the initial progress.
We focused on the top 120 Premier Hospital accounts and health systems, we've already been April and the first two months and.
And be able to do presentations to those accounts and we're already up accounts now.
Kangaroo on contract and are starting to order product and likewise, we just announced today the acceptance of simple.
On Health Trust.
And then another large GPO looked at the product the product characteristics saw the benefits of simpler.
And actually added this product mid cycle.
And so we're pleased to be able to have it added and a mid cycle mid cycle period for health for us. So we think the expanded market access is going to continue to help us drive volume increases, we're obviously investing as well and to a commercial organization as we continue to slightly add additional sales reps.
And actually get tremendous leverage from our partnerships as it relates to having net share of voice and reach and help drive the penetration of our products and then finally, hopefully we'll start to see some additional data generation and communication of that data generation showing the differentiation of our products start to reach the market here in 2020 as well so.
All those factors, we believe will help drive a very strong year as it relates to our core products.
Okay. Okay. That's helpful. Ron and then Matt just quickly on gross margin again really strong here in Q4.
And I know there was obviously a benefit on the core side do and better than non core that's going to reverse a little bit here and.
And 'twenty one so how durable are some of those production and inventory management improvements that you've made to.
And maybe provide a little bit of upside on the gross margin side as we move through 'twenty two excuse me 21 versus what we kind of unexpected.
Yeah.
Well.
It's true.
And our core products, obviously are higher margin and the non core products, but.
We have a number of gains that we think will be durable as you say and and we have several more that we'll be working on as we move through 2021 as well.
Some of those will take a little bit longer too.
To come into play so I wouldn't expect much of an increase in gross margin going into this first quarter.
Especially given that it's a little bit more of a seasonally light.
Quarter from a revenue perspective, but I.
I think if we move through the year, we should see at least that same level of.
Gross margin gain year over year potentially a bit more even so.
<unk>.
We're optimistic and feeling good about that part of the business.
Got it thank you.
Thank you and our next question comes from the line of kilogram per Charley. Your line is open. Please go ahead.
Hi, guys. Thanks for taking our questions and congrats on another good quarter, but just starting out I mean, we're two months into the first quarter can you just speak to what you're seeing year to date and how youre thinking about the cadence of results and you look out through the year.
Sure I can speak to that and perhaps from I want to add to it but.
But yes, we have the benefit here of having a couple of months under our belt and and the first quarter and we feel good about the business and we factored that into the guidance that we gave overall for the year.
As we've mentioned there is a little bit of.
Seasonal trend, where we see greater gains towards the end of the year.
And then I think the Covid impact we all hope it is.
And as less as we move through the year than what we had seen in Q1 and certainly the some of the weather impacts that we've seen and just recently here we wouldn't expect it.
To continue as we move through the year so.
I guess we are.
We feel good about the year, we think there will be strong year over year growth compared to Q1 of last year.
But maybe.
And maybe it won't be quite at the same percentage range is what we're projecting for the full year, if all of that makes sense.
Great now and that that makes that's completely clear that that makes sense.
And then you guys completed your product design for for the next generation Kingery with with antibiotics can you just lay out and sort of the steps now from here through the approval and what sort of additional updates investors should be looking for over the next six to 12 months and as we get closer to that thank you.
Sure Ken I'll address that one so yeah, we're very pleased to be able to lock product design of our next generation came from product and again. This is adding the antibiotics rifampin and minocycline and two kangaroo.
So we had actually a number of studies to get to the point to lock the product design and so very pleased with.
And what we've been able to accomplish and we've also gone out and have shown the product and a number of doctors and gotten feedback and theyre very excited about the product design and having the antibiotics added to Kangaroo. So now the next step is to complete our manufacturing validation and we're working with our partner here Cook biotech who is assisting on that.
And then once we have that completed and will run a number of in vivo and in vitro studies that will be required for our 500 10-K filing with the FDA and those will start to take place and the latter half of this year and I'm sure, we'll be able to give updates throughout the year as we go through earning calls on the progress of this project.
Again, we're very pleased with the progress we've made to date, we continue to remain on track as we said with our goal of filing this product and Q1 2022 with approval then and the second half of 2022.
Great. Thank you guys.
Thank you and our last question and I'll come from the line of Brandon Folkes with Cantor Fitzgerald. Your line is open. Please go ahead.
Hi, Thanks for taking my question and congratulations on a very good quarter and.
So maybe just sort of looking at this from a high level well you know what do you see the environment.
Currently and business development is this something when we look out to sort of I guess 'twenty 'twenty, one 'twenty and 'twenty two and.
Should we expect sort of.
Additional partnerships on or maybe in licensing and actually buying and products sort of what do you have an appetite for and what do you think the environment is currently and most conducive is it sort of these continued bye bye and tie partnerships that we should expect and then you're Tim. Thank you.
Sure Brian and thanks for the question. So we're very excited about the future growth of our company off the suddenly the assets that we have today the technologies and we have today and obviously the pipeline products that we have in development.
And so we do believe there is additional growth opportunity through these assets will continue to look at how to best optimize the commercialization of these assets.
Today, we continue to use a hybrid model both direct sales force as well as partnerships as we evolve additional products will continue to look at the the best model for those to optimize the opportunity for patients to benefit from our technologies and again from a company perspective, we're very bullish on the growth of the zeal organically.
From what we have today on the market and what we anticipate to come to market and the near term from our pipeline on.
And that we want to continue to look at inorganic growth opportunities and.
And we are constantly doing that.
Wanted to be able to add additional products technologies.
To augment the technologies that we have and the channels that we're in today from a commercial standpoint, and if we find the right opportunity that allows us to bring in and new product new technology and or.
Have a company be part of that roll up within us and we'll explore that we want to make sure that we're making the right choices here and doing the investments and any acquisition that makes the most sense for the company and for the shareholders. So I think we're in a great position to be somewhat selective and net and that we have great growth prospects.
Our organic business and our pipeline.
We can be a little bit selective here and we want to make sure that we're making the right acquisitions to drive the right top line growth for the company.
Great. Thank you very much.
Thank you and this does conclude today's question and answer session and I would like to turn the conference back on behalf on line for any further remarks.
Thanks, and closing again, we're very optimistic and confident about our path forward. The foundation that we've laid for off and on optimizing growth.
For our business as well as for our shareholders and I just wanted to close by saying none of this would be possible without the ongoing commitment of this team and our commitment to our mission of reducing complications that are associated with implantable devices. So we look forward to updating you on our business in future quarters and again, thanks, everybody for joining us.
Ladies and gentlemen. This concludes today's program and you may all disconnect everyone have a great day.
Okay.
Okay.
[music].