Q4 2020 XpresSpa Group Inc Earnings Call
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Okay.
Greetings and welcome to Express Barnes group fourth quarter 'twenty 'twenty earnings Conference call. At this time all participants are in a listen only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during todays.
Please press star zero on your telephone keypad other.
As a reminder, this conference is being recorded I would now like to turn this conference over to your host Mr. James Berry Chief Financial Officer. Thank you Sir you may begin.
Good afternoon. Thank you for joining us today and for your interest in express spar group.
Before our CEO, Doug SaaS, and then provide an update on our business and I briefly review our fourth quarter 2020 financial result, I first need to advise you that this fall.
Comments made on today's call may contain forward looking statements within the meaning of the private Securities Litigation Reform Act of 1995. These forward looking statements are based.
Non current assumptions and opinions and involve a variety of known and unknown risks and uncertainties.
Actual results may differ materially from those contained in or suggested by such forward looking statements.
Important factors that might cause such differences include those set forth from time to time in our SEC filings.
Including our report.
On form 10-K for the year ended December 31, 2020, which was filed this afternoon as well as our earnings release also issued this afternoon, along with other current and periodic reports that we file with the S. E. C. I would now like to turn the call over to Doug.
Good afternoon first I.
I would like to welcome Mr. James Berry, our new CFO to his first express spot earnings call welcome James.
This afternoon I'd like to provide a brief update on our legacy spot business before moving on to where we currently stand with express check out.
Afterwards, I will share some preliminary thoughts.
Including some near term steps that we're taking and evolving our business model to capitalize on what we view as a substantial opportunity in the travel health and wellness space in a post Covid world.
So starting with our legacy Express Spa business.
All airport traffic begins to recover COVID-19.
19 cases continue to decline and as more and more people get vaccinated the consensus across the travel industry is that it will likely take until late 'twenty 'twenty. Two so early 2023 before we can return to pre pandemic travel volumes.
We are certainly encouraged that traffic has.
It's picked up recently, perhaps due to in part to spring break excursions and that the airport and airline employees are returning to work still we have a long way to go and based on historical seasonal patterns traffic is likely to taper off again in the near term before the summer.
Again.
Beginning last July we reopened two international Express Spa locations to test the waters, specifically, we opened our spas and Dubai International Airport, where we have been providing limited spot services and selling various spot products, such as net pillows and travel blankets.
Then in late September.
Timber are solid domestic express spa franchisee reopened in Austin Bergstrom International Airport.
Ever all three of these locations continue to underperform, despite increasing airport traffic and are not close to breakeven profitability.
Given these.
Circumstances, and what we believe will be continued customer uneasiness, having one to one close personal interactions with massage therapists and cosmetologist in an airport setting. We currently do not have plans to reopen our spas for traditional services in the near term.
We have run.
Non analysis on several low to mid volume scenarios and none of them project, an acceptable financial outcome at this point in time.
This could change as pandemic as the pandemic wanes and we will therefore reevaluate possible reopening of select spas in the future.
Now turning to our expressed.
Press check business.
As of today, we are operating 11 express check wellness centers across nine airport locations with two additional pop up locations in the pipeline.
First one the first will be opened to come our Seattle Tacoma International Airport and the second at San Francisco.
So international Airport, we expect both locations to open in the coming weeks.
Our patient volumes at express check continued to increase its rising traffic at the airport and we are further aided by the rollout of the rapid molecular Covid test that we launched in early October.
This is.
Been by far the most preferred option compare to the polymerase chain reaction or PCR test or the blood antibody test.
And is that a substantially higher price point $200 versus $75.
Over 73% of all tests that we're conducting.
Now rapid.
Which has also helped improve gross profit margin and help to reduce our monthly cash burn.
As detailed in our last quarterly earnings call 10-K, and in todays 10.
The last 10-Q and in today's 10-K filing based on state by state regulations.
We do not report revenue on a per patient basis.
Services, but instead, we receive our revenues as a management service fee from the physicians.
This is because express check operates as a management service organization or NSO, which is a health care specific.
Administrative.
In management services engine that provides a range of administrative and management functions with accompanying management services agreement with a physician as governed by state by state regulations. As a result, we are not able to recognize revenue from the fourth quarter 2020.
'twenty related to express check however.
However, we have reassessed our agreements and updated projections for new locations that are better reflective of the actual patient volumes that we're seeing in our locations.
Therefore, we anticipate being able to report revenue in the first half of this year.
Also notable effective March eight 2021 express check transitioned to a fee for service model for all tests <unk>.
Similar to what we've been doing all along with the rapid tests under this model patients pay express check directly at the time of service.
And then they are able to submit their testing fees for insurance reimbursement on their own.
However lab fees are still submitted for insurance reimbursement from the outside lab companies.
We will also be adding a rapid PCR test and another rapid antigen test to our suite of COVID-19 testing services.
Is this week, which will provide passengers additional methods of testing.
And that many required for travel and additional lines of revenue for us.
In the past several months the express check brand has also secured a few notable partnerships.
As announced on November 13, 2020.
<unk> become we became a designated state of Hawaii trusted testing partner.
All travelers ages five and over are required to take a nucleic acid amplification test where N. A T from a certified clinical laboratory improvement Amendment clear.
In order to.
To bypass the state of Hawaii is 14 day mandatory quarantine.
The state of Hawaii, except test results only from <unk>.
Trusted testing and travel partners test must be taken no more than 72 hours before flight departure time.
We are proud to be a trusted partner of the state of Hawaii.
As people take a long awaited Hawaiian vacation.
As of January 28th we've been working with United Airlines Delta Airlines, KLM Royal Dutch Airlines out of our JFK terminal four.
Location, our Newark, Liberty International Airport locations, and our Boston Logan International.
Port locations for flights to the Netherlands.
Netherlands, COVID-19 testing policy for incoming passengers.
International passengers requires a negative.
COVID-19, PCR test within 72 hours before departure as well as a negative COVID-19 rapid test for hours before departure.
This is the strictest travel requirement.
Globally at the time, we are collaborating with these major airlines to meet the rapid four hour test requirement at these select airports. We've also piloted at JFK terminal four the implementation of a rapid antigen tests administering <unk>.
Rapid Sars Covid two test for the BD Meritor plus system.
Next we partnered with the common trust networks common past platform, which linked to COVID-19 test results from partnered labs, such as express check directly into the common paths App passengers are then able to show their.
Their test results through this app.
Two airlines and destinations so as to ensure a hassle free entry and avoid quarantines where applicable.
The common past digital health pass is currently accepted upon arrival at Aruba, Queen Beatrix International Airport.
Two.
True.
Jetblue U S customers traveling from Boston are able to utilize the two express check wellness centers at Boston Logan International Airport for COVID-19 testing with their test results then uploaded to the common pass app.
We are hopeful that acceptance of common pass will continue to expand over time.
And we are engaged in discussions with other emerging health passport apps that could similarly be deployed to express check wellness centers as soon as reasonably possible.
We are also awaiting approval on a state by state basis to administer COVID-19 vaccines approved for use by the FDA.
At select express check locations.
PON state by state approval and receipt of the necessary COVID-19 vaccines, we may launch a vaccination program primarily focused on airline employees.
Airport staff initially although passengers could be eligible for vaccines over time.
Object to supply availability and other state eligibility requirements.
Finally.
An express check.
While we believe that COVID-19 testing will remain an important and necessary service for airline employees airline staff and passengers for the foreseeable future we.
<unk> future development than the additional express check wellness centers pop up or other beyond the two pending locations in the pipeline. This is based on our evaluation of the economic viability of the remaining major hub airports and developing international travel requirements.
This.
This decision was made so that we can dedicate our efforts and resources to bring to market a new more comprehensive travel health and wellness brand focuses on emerging new category of health focused travel and personal wellness services that would still include COVID-19 testing and other related services.
Yes.
So I'll turn to the travel health and wellness brand that we're working on.
We'd now like to start sharing our plans with our investors as to how we plan to evolve as an organization.
As you are already aware once the pandemic struck last March we quickly pivoted to express.
Okay. That's a bridge between our legacy spot business into what we believe health and wellness brand customers will be looking for in a post COVID-19 world.
We are at the point, where a need state and a once state are colliding and we can provide the answer for both.
People need to be.
Safe and healthy, but they want to return to travel so we can help them travel well.
Clear reasons consumers are more health and wellness focused in general than ever before and this is especially true as it relates to travel with this new brand whose name we will announce at a later date, we plan to provide.
Good health and wellness services for the entire travel journey from planning to post a rival care.
We are developing a health and wellness brand that is positioned for a post pandemic world that Leverages, our historic travel wellness experience and our newly acquired healthcare expertise.
We are preparing a launch of a travel health and wellness company delivering on demand access to integrated health care through technology and personalized services.
The strategic brand pillars, our travel health and wellness, which places our experience and assets.
Assets directly and the intersection of these three categories.
Wellness was skyrocketing trend category prior to Covid, 19, and adding health to that combination will enable to rise again.
In the health pillar, the new brand will be differentiated because it is a travel focused in an.
Airports.
While in wellness. It is differentiated because it is a travel industry retailer an expert.
And travel the new brand is differentiated because it has health and wellness experience and will provide access to integrated care and health documents all in one app.
We see this concept.
Concept evolution as a significant opportunity to be a category innovator and a new niche industry, where it can leverage technology. In addition to its existing real estate airport operational experience.
In providing travelers with peace of mind and access to integrated health care the.
The brand name.
<unk> again will be announced at a later day.
While COVID-19 testing will be available under this new brand broader suite of services may include pre travel planning.
Onsite medical services, such as net metabolic panel testing.
Xiety care and convenience travel.
Care.
Virtual chat care and video care through a partnership with an established telemedicine company.
And access to virtual wellness care, such as guided meditation and yoga.
The first two integrated travel health and wellness locations are expected to open in late summer or.
Early fall 2021.
Over time, the company intends to evolve some of its legacy Express spa footprint into this new travel health and wellness brand, where feasible as well as open additional locations and other suitable terminals and airport venues.
However.
Over the.
Long term, we envision that our digital channels will provide more significant growth opportunities for revenue and profit than our airport real estate.
The success of this revenue stream will be achieved through both subscription based services that provide care and tools supporting travel health and.
Wellness.
Further we will be offering upstream content that can be monetized through affiliate revenue as well as curated retail through e-commerce.
We're currently laying the groundwork to have our initial digital assets launch in the summer timeframe ahead of the first two brick and mortar location openings as true.
Rob will begin its recovery this fall and into 2022.
Given its strong liquidity position and poised for growth.
We also we would also consider accretive acquisitions and other investments to further broaden our service and retail offerings, we would invest in new opportunities.
Beyond this new evolving concepts.
We're excited about this new brand and the future of express Spa.
That I will turn it to James.
Thank you Doug.
As referenced earlier, we had negligible revenue during the fourth quarter, given very limited operations and our aforementioned inability to recognize revenue under.
Our management services agreement.
As a result of the uncertainties around the cash flow of the express check business. We concluded that the collectability criteria to qualify as a contract under ASC 606 was not net during the fourth quarter 2020, and therefore, no revenue associated with the monthly management fees was recognized from.
From the management services agreement instead.
Instead for the fourth quarter 2020, we have recognized management fees paid of $900000 as a deposit contract liability.
As of December 31, 2020 management fees not recognized as revenues was $3 4 million.
We do expect to be able to recognize revenue in the first half of 2021 after reassessment of the management service agreements relative to ASC 606.
As a result reported revenues during the three months ended December 31, 2020, with $323000 compared to $10 9 million.
However in the corresponding period of 2019 the decrease in revenue was primarily due to the adverse impact of COVID-19, and our temporarily closing substantially all global spot locations due to the categorization of the spa locations by lower local jurisdiction as non essential services.
The decrease was offset.
A new generated by services and products of $2 246000 68000, respectively.
<unk> and marketing agreements with strategic partners in the recently reopened spots in Dubai and $9000 for others.
Cost of sales decreased to $2 4 million from $9 2 million in the prior.
Higher year fourth quarter. The decrease was due to the reduction in variable costs associated with the decline in the express spot revenues and decreases in occupancy costs. As a result of rent concessions received from the airport there were offset by the cost of sales provided pursuant to the express check management services agreement of $1 2 million.
On impairment and disposals of assets expense increased to $9 million from $5 2 million in the prior year fourth quarter. The expense was related to the impairment of our express that trade name due to the changing business climate.
Due to the COVID-19, pandemic and impairment of leasehold improvements made to certain.
And expressed by locations operating lease right of use assets, where management determined that the locations discounted future cash flows were not sufficient to support the carrying value of these assets over the remaining lease term and trademark.
General and administrative expenses were flat at approximately 5 million.
For bulk of the comparable periods.
Operating losses from operations increased to $17 5 million compared to $10 1 million in the prior year fourth quarter.
Net loss attributable to common shareholders was $15 7 million compared to net loss attributable to common shares.
Holders of $7 1 million in the prior year fourth quarter.
Finally, with respect to our GAAP financials, our liquidity remains strong with cash and cash equivalents.
<unk> totaling approximately $89 8 million.
As of December 31, 2020.
For further details.
Please refer to our annual report on form 10-K filed today.
Let me now conclude with some non-GAAP financial metrics with respect to express Jack that we believe will be helpful in providing greater transparency in terms of its performance.
Although we do not generate.
Revenue directly from patient testing volume as detailed above in the interest of <unk>.
Providing investors with greater transparency regarding express checks performance, we have opted to disclose recent and current average daily patient testing volume along with other relevant non-GAAP financial metrics.
During the fourth quarter.
Quarter 2020 average daily patient testing volume for express check Wellness center with approximately 70% to 100 people with higher volumes during the November and December holiday travel period. This reflects a significant increase from the average daily patient testing volumes generated in the third quarter.
Of 2020 of 30 to 50 people and was due largely to the rollout of the COVID-19 rapid testing along with an increase in the airline industry traffic over the three month period.
Notably the number of higher revenue higher marriage, and COVID-19 rapid test as a percentage of total tests average 50.
<unk>, 5% during the fourth quarter of 2020 and 67% in December of 2020.
COVID-19 rapid test not become readily available that Expressjet wellness center until early October 2020.
During the first 12 weeks of the first quarter of 2021, the average revenue per patient.
It was $150, while higher revenue higher Maridjan COVID-19 rapid test as a percentage of total cost average 73%.
Total express check pro forma patient service revenues for three months ended January 31, 2021 was $3 $3 million, while pro forma express check.
Patient was profit was $1 2 million, representing a 36, 5% marriage in.
Total patient volume was 22344, including 14998 rapid test volume during that period the improvement in the four wall performance of express check has slowed the company's monthly cash.
Group and exceeds the pre pandemic gross profit margin of the legacy Express Spa location.
So with that we appreciate your time this afternoon and are now ready to take your questions.
At this time, we'll be conducting a question and answer session.
I would like to ask a question. Please E.
Mo IR at Express Spar group Dotcom.
While we wait for questions.
Michelle you May proceed with question.
Hi, Doug.
The first question, we have coming in.
Perhaps reopening spas at the moment is not a good idea.
But once the vaccine is rolled out and available to everyone by the summer why not try and opened a few locations don't you think people will begin to resume normal activities at some point and don't you think the spa to be more relevant than.
Thank you for the question Yeah, it's a it's.
It's a tough one you know we opened a couple of spas to see how they would do they are underperforming I'm not convinced that people will be rushing even when they have vaccinations to have.
Such close intimate interaction, even if 10% to 20% of our traffic.
That used to come to us decide.
We're going to wait until next time.
That can be a material difference in our economic model.
One of our.
Major competitors in other airports they opened a handful of spas during the holidays in November and December and then we close them again in January.
But the short answer.
So it is change and we will be reopening, but in a new format in a new world with more relevant services and more relevant retail we're extremely excited about the new path that we're going down.
And we will be able to leverage a lot of our existing real estate as.
As well as get access to a lot of new real.
As the World just like we did with express check.
Okay.
Great and the next question did you receive any stimulus as it relates to Covid testing in the airports did you apply and what are you expecting to.
We haven't received any new stimulus from the recent buildup.
State came.
We have been speaking with the Trump administration and the by the administration and various government departments.
We have ongoing discussions with the CDC and HHS, we want to avoid further pandemics and we think that we're well positioned and they are very interested and to support their agency.
Those efforts with the number of people that we have access to.
So more to come.
Great and.
How long are these various express check contract are they all 12 months from the commencement of operations at <unk>.
Testing.
Agency to say why not open a few pop more pop ups to capitalize on the opportunity in the near term.
So let me repeat the question back how long are the contracts and.
Are they all 12 months and then why not open a few more pop ups I get that.
Sure that is correct.
So our contracts range in time in some instances, we're simply amending an existing leased we have some are 12 months emergency use provisions some have rights to extend summer two and three year deals we have a right to terminate if all of a sudden the business dries.
So there really isn't one answer.
The point is we negotiated flexibility you know as much as we can with the airport leases, which often have very defined constructs.
Why not open a few more pop ups, we are watching this carefully and we have hit a lot of the major.
Ports that we've been targeting some have gained some testing facilities, but more importantly, based on our evaluation of the economic viability of the remaining major hub airports and this constantly developing international traveler requirements that will tell us.
Airbus right our development for express check picks back up.
Maybe it stops here maybe it goes further so it's every month or so and even more frequently we're constantly evaluating.
The run that we have when we signed these.
Contracts make these investments and certainly look for return on that investment for our shareholders.
Okay, Great Doug and the next one.
You have any current authorization to raise additional capital always seek a new authorization.
So.
What we do currently have a shelf I think everyone is aware and I've been asked this question before.
It's the exact same answer we do not have immediate plans to raise capital, but we always reserve the right if the opportunity presents itself.
Aye.
CEO and our board has a fiduciary responsibility to take advantage of market conditions. When they arise time to time and I think the company is in a much stronger position now because of the decisions that we've made so again, we don't have immediate plans.
But we're always watching.
Is this great. Thank you, Doug and how will you be able to recognize revenue beginning in the first half of 2021.
Alaska My colleague James to answer this one.
The revenue recognition.
<unk> contract is called ASC 606, and it requires that the.
Customer has a ability to pay the full amount or substantially the full amount.
In 2020 are or we were not able to meet that criteria under 606, you reassess as time goes on and you reassess the contract against the.
Ability to collect.
And it is based on that debt, we now believe it.
Strongly.
Content, we will have be able to recognize that revenue under 606 with the contracts that we have outstanding at this time.
Great Thanks, James and from the <unk>.
Next question.
Sure.
The meaningful patient volume difference between each location is the percentage that is rapid test stable across.
The footprint.
Okay. So two questions.
One is the different is there a meaningful difference between patient volume location by location.
And then the percent of rapid test that consistent so.
It does vary.
Larger airports like JFK or have more humans coming through Theyre higher volume and then Salt Lake City is less.
Less traffic airport JFK that will.
<unk> literally have different volumes, it's interestingly, depending on which hubs the airports lean on one of the reasons. We did the Salt Lake City is because it's a delta hub and they funnel a lot of flights through there for being a medium size airport. They are getting a lot of business.
And so we've tried to be thoughtful.
Where we place these investments.
To meet the most travelers from the most needs.
So they do vary we also have locations. Some that are pre security. Some that are post security from when we went into it we wondered would we see a material difference. If we were post security would we miss out on a lot of the traffic.
Perfect and the revenue or the traffic is similar.
Similar I wouldn't say materially different so we're pleased about that and continue to to operate again these things can change as.
Airlines shift traffic patterns from terminal to terminal and hub airports a hub airport generally.
<unk> speaking.
Airports are in a similar range. Although there are differences based on the overall size of the airport and then the second question about rapid testing.
We have steadily seen this march and we talked about.
I think James spoke.
Spoke about you know at one point the rapid tests were 55% for Q4, and then December was actually 67% and then for the first several weeks of Q1. It was up to 73% right now it's over 80%. So it continues to move up this.
Because it's a higher cost and a higher margin product and we feel even better with a rapid PCR test that we just launched on Monday, and we announced this week for piloting and JFK and then we're going to launch it in Houston next week, and then we will likely spread it too.
The rest of our centers to have a another premium rapid test that would sit alongside the avid IV now.
And would fall right in line with the trends that we're seeing consistently across our whole portfolio.
Onsite rapid testing is the desired state and I think we're.
Are going to see rapid antigen testing starting to emerge as more destinations except that our rapid antigen test or antigen test in general it's not as sensitive as a molecular or a PCR test, but it's still pretty good and so there are some countries that are starting to accept that.
<unk> the less expensive as a test so and some of them you can operate even faster.
We're putting our feelers out and learning with the test protocols that are develops only the ones that have the EU authorization by the FDA.
And we are shifting our business.
So to adapt to the dynamic environment.
That's great.
Great. Thank you Doug.
You expanded your operating hours at airport passenger volume has increased.
Are you staffed differently different day parts what is the.
<unk> monthly management fee per location.
Okay. So we have expanded our operating hours and you know there was some quest.
Questions in the fall.
We were running five days, a week and started to move to seven days a week in some airports.
In the fall.
Newer operating all of them seven days, a week reasonably werent running them all seven days a week before because there just wasn't that much business much as we'd like to thank people are traveling they're getting back we've been very careful to.
Operate when it is the busiest the labor that we have is an expensive.
And now getting medical assistance and nurse practitioners and others. There. So we're very careful.
Where we invest our labor that we're going to get a return for it but its travels coming back our operational hours have expanded.
To meet these needs.
I think you also asked about the staff.
Staff differently different times of day, no not necessarily people come in for fixing it hours six or eight hour shifts and our staffing model is pretty consistent throughout the day.
Even though the airport does have peaks and valleys it could be.
Slow for two and a half hours because theres no flights and then it's.
Super busy for two and a half hours. Unfortunately, you can't send people on and off the clock two hours at a time when they drive all the way out to the airport. So we have to be thoughtful in how we manage our labor.
We're continuing to look at our labor as well too.
To ensure our initial assumptions with the number of staff that we need is actually necessary with the day.
A man that's coming in I think the last part of the question was.
Around the new monthly management fee per location. So now that we have a good amount of data.
Some of our express checks have been open like nine months. Some have been opened four and five months, we have a credible trajectory of.
Or or or volume of traffic other than maybe the peaks, we had during Thanksgiving and Christmas, but now we can even better anticipate and adjust our management fees with our MSA contracts, but also staff our labor efficiently. So again, we're right.
Sizing the labor spend with the.
Traffic, that's there while keeping an eye to expanding passenger traffic that's slowly coming back.
I think I got all the questions here.
Yeah.
Okay, great and for the next one.
Why do you think passengers with want to interact with their travel health and wellness brands outside of the airport environment Arent Airport services really only relevant to customers if they address their needs other captive audience.
I think it's a fair question, but you know I want you.
You did take a step back and think.
About is as the world returns to travel and the.
Against planning they will inevitably be looking for tools to help them do that safely and responsibly.
We believe the new concept, we're developing includes services and access to travel care and documentation.
That will be.
Well to that traveler and providing them all everything they.
Need in one place will be.
Other unique right now people are using multiple sources, possibly multiple apps.
These services paired with on site health and wellness services in airports will help customers returned to travel with.
With peace of mind.
We believe this customer is everywhere and not just a captive audience sitting in airports.
Okay.
Great. Thank you and one when would you expect the company to be at breakeven.
James.
James This one's for you I'm glad to have a Jamie before I have answered all the questions.
While we are introducing the new brand vision today, we are not providing guidance at this time.
Okay that question I'm sorry.
Not yet.
Okay.
Okay and another one.
Why is now the right time to be hiring.
Hearing senior level people that will likely be very expensive.
Well, we are making investments.
Surgically strategically and bringing an expert executives that have done these things in the past that will help us.
With our new concept and evolve.
And adapt our express spa and our express check model into.
A new more relevant concept. So we haven't hired like lots of people, but we're being really smart on on the leaders that were bringing in and they have each made an immediate impact from states come in for sure.
Okay and then.
So you don't have a tech industry background. What gives you confidence that you are the right fit to lead a tech company going forward.
Well you know I don't have a medical background, either and I didn't have a spa background, either when I joined.
As the CEO, it's important to surround yourself with talent.
Has this experience and has the ability to execute them in one of the speaking of executives that we hired a gentleman named David Cole we brought in as our Chief Technology Officer. He is fantastic. He has been working with consumer.
Consumer brands in the digital space or his whole career.
It was a senior executive at Nike Amazing Consumer brand and then was the CTO at zoom care, which was a.
Regional.
Urgent care powerhouse in the Pacific Northwest and developed a lot of technology and we're one of the early leaders in telemedicine.
Years ago, So David is coming in and has the.
Its architected a plan, where we will be building some assets will be buying some assets and partners from outside companies.
Bring this this future model.
Reality very soon.
And.
That's why we brought James.
Ames here he has a great background and that again is helping us model and have a hopefully a strong P&L in the future.
Yes.
Okay, Great and then why Havent you got in the clothing vaccine yet at the express check location are you still getting it.
And if so when.
So in order to get the vaccines youre doctors need to be registered and approved state by state each state has a.
Slightly different application process and procedure.
All of our doctors are in this process.
<unk> now, but for example in New York State.
Our doctor has been.
Approved should do it but they haven't admitted.
The next batch of clinics or doctors to support the distribution of vaccines. So.
So now many of the states have been strong.
Struggling with.
The demand in the supply chain getting vaccines, so I understand they're not.
Letting a lot of others in to start distributing the vaccine, but as the supply chain writes itself, which we're starting to see I'm hopeful that these will get the relief from the appeal.
<unk> to start doing vaccinations on site at the express check locations, maybe not all of them.
We will go to but but we'd like to get in as many as possible our focus in the beginning will be Eric.
Airport employees and airline employees, and then we may or may not exceed.
Span into the public after that we just need to see where the demand is but it starts with having all the licensing that we need which we started many many months ago anticipating.
This is coming.
Great. Thank you Doug.
And then one more do you.
You have any other airline partnerships rolling out similar to United Jetblue and Hawaiian Airlines.
There are other international carriers that were speaking to.
So with some of the domestic major carriers, we have a relationship with we were talking to them about.
About expanding these relationships it depends often it's driven by these they have where destinations often international destinations have changing requirements. So the Netherlands example, when the Netherlands said, Okay and clean PCR test isn't good enough. We also need a rapid test for.
Four hours before boarding.
That's when we got called by three Big Airlines to help them in Newark, and JFK and Boston.
So.
It's often comes through these kind of Covid free safe packages that are that are drawn up.
We talked to we work.
With these guys on crew testing time to time, but these arent necessarily.
Material announcements on press releases, so we offer a range of services.
And we are a tool that that the airports from the airlines use to sell tickets and get people confident in traveling again.
So yes.
Yes, there is more but nothing I can announce before extensions or.
New deals are signed.
Great Doug and then from the last question.
What happened with common paths or air bridges to places like London debt you'd spoken about in the past.
Yes. So this is a good example that can be really careful when I speak because these things change so often so.
We were lined up to support the Trans Atlantic.
Well I actually have two airlines to London and this was felt like it was a share.
Sure thing, but.
This man coincided with the timing of infection rates, increasing in the U K. So the British government said.
They pulled the plug on the program they were going to loosen restrictions on in and have some testing protocol that would allow people to maybe reduce the corn.
<unk> when they arrived in the U K and then they just stopped it.
Understandably cause infection rates are going up. So so this is constantly to start stop start stop that a lot of these destinations governments agencies.
Live with this is why its hard for travelers sometimes.
And it often.
Directly correlates to.
Infection rates, rising or falling vaccination rates, increasing neighboring countries or cities.
It's you know as we all watch the news.
Quite complicated at times.
So <unk>.
<unk> are still a thing.
That that.
Concepts that countries and airlines are able to.
Put together to help travelers feel there is a lower risk path to go into these places and again, we're uniquely positioned.
At so many airports too to support it on site.
Yeah.
That's all the questions we had today, Doug so if you'd like to just give some closing remarks.
Okay.
Well.
With that I'd like to thank everyone.
One for their support in the past.
We have a lot of exciting things coming.
And trust that the management team is working very hard to make sure that express spar group the company.
And our shareholders will have a relevant business.
In this changing world in a post COVID-19 environment everyone's trying to figure out what it will look like and we clearly see this emerging trend of travel health and wellness and we are uniquely positioned to be an early leader in this space and we're assembling a team.
To join me to to deliver.
Over on this so we're excited about the future.
Even though it's it's you know there's there's uncertainty.
But we're doing all.
All the homework, we can and putting together a great program. So thank you for your time listening to call and have a great week.
This.
This concludes today's conference you may disconnect. Your lines at this time. Thank you for your participation and enjoy the rest of your evening.
Okay.
[music].