Q1 2021 Healthcare Services Group Inc Earnings Call
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The matters discussed on today's conference call include forward looking statements about the business prospects of healthcare Services Group, Inc. Within the meaning of the private Securities Litigation Reform Act of 1095 forward looking statements are often preceded by words, such as believe expect anticipate land sales.
Oh neat intends assumes or similar expressions forward looking statements reflect management's current expectations as of the date of this conference call involve certain risks and uncertainties of forward looking statements are based on assumptions that we have made in light of our industry.
And our perceptions of historical trends current conditions expected future developments and other factors that we believe are appropriate under the circumstances.
As with any projection on or forecast they are inherently susceptible to uncertainty and changes in circumstances Healthcare services Group, Inc. 's actual results could differ materially from those anticipated in these forward looking statements.
As a result of various factors and the forward looking statements are not guarantees of performance. Some of the factors that could cause future results could materially differ from recent results for that is projected in the forward looking statements.
Included in our earnings press release issued prior to this call and in our filings with the Securities and Exchange Commission, including the SEC's ongoing investigation, there can be no assurance for D. C D or another regulatory body will not make further rapid growth inquiries or pursue further action that could cause that could result in significant costs and expenses included.
Including and potential sanctions or penalties as well as distraction for management ongoing investigation indoor any related litigation could adversely affect or cause variability in our opinion for results you are not under no obligation and expressly disclaim any obligation to update or alter for looking statements whether as a result of for changes.
New information subsequent events or otherwise.
Ladies and gentlemen, thank you for standing by and welcome to the H C. S. G. 2021 first quarter 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. That's a good question during the session. We dressed star one on your telephone please be advised that today's conference is being record.
Good.
For your party further assistance. Please press Star Zero I would now like to hand, the conference over to Mr. Ted Wahl, President and CEO. Please go ahead.
Great. Thank you Sharon and good morning, everyone, Matt Mckee and I. Appreciate you joining us today, we released our Q1 results. This morning and plan on filing our 10-Q by the end of the week.
Overall, the vaccine rollout has been a real game changer for the industry and a significant first step towards recovery with new Covid cases, among patients and residents dropping over 90% between Q1 Q4 and Q1.
We've seen similarly positive new case trends amongst facility staff as well.
The success of the vaccine has led to stabilizing occupancy and has been a huge morale boost for frontline workers.
As positive an impact as the vaccine has had the reality is the exact pace and even pathway of recovery is still uncertain, but we do feel good about the stabilization that's occurred.
Can use to be that it will happen, but we're looking at a 12 to 18 month process with fits and starts along the way from <unk>.
State agency funding in action.
Will be crucial in ensuring ass.
Timely and orderly a recovery.
Even with all of the pandemic.
And delivered outstanding operational and financial outcomes in Q1 to the themes of the past for quarter.
First we did a great job of control.
For the controllable around service execution customer satisfaction and Bud.
Top line growth with the revenue.
So puts and takes that remain in play.
Levels and facility access challenges, coupled with our own more cautious approach during this.
It's most early stage of recovery, we continue to expect Q2 revenues to be flattish relative to <unk>.
Q1.
So while COVID-19 remains on near term headwind on revenue some of the recent more positive industry and customer data have provided us with improved top line visibility for potential growth opportunities in the back half of the year, which is really exciting for us to start to think about and plan for.
Before we move on to the discussions on Q1 results I'd like to briefly touch on the FCC update we provided last quarter and again in this morning's release.
As we previously highlighted the S E. The company and the FCC have commenced discussions regarding a potential resolution to the investigation. We're pleased that the matter has moved into this phase and hope to continue to work with the SEC to reach a final resolution.
As I'm sure all of you can appreciate beyond what we've disclosed previously and in this morning's release, we discussions are active and ongoing.
So with those introductory comments I'll turn the call over to Matt for a more detailed discussion on the quarter.
Thanks, Ted and good morning, everyone.
Everyone revenue for the quarter was $407 $8 million with housekeeping and laundry and dining and nutrition segment revenues of $215 million and $192 $8 million respectively.
Revenue included $3 $9 million of Covid related supplemental billing our customers.
Net income for the quarter came in at $24 per.
For share was 33%.
It's per share.
Direct cost of services was $336 $6 million or <unk> 82, 6% well below the company's historical.
Called target of 86%.
Housekeeping and laundry and dining and nutrition segment margins were 13, 1% and 10, 4% respectively.
SG&A was reported at $40 million or nine 8%, but after adjusting for the $1 3 million, Inc, or nine 5%.
During the quarter SG&A was also impacted by about $2 million of legal and professional fees related to the.
Previously announced FCC matter.
Longer term, excluding any COVID-19 work.
For SEC related costs, the company's target remains seven 5% with the primary leverage existing and top line growth <unk>.
<unk> and other income for the quarter was reported at <unk>.
It was about a half a million dollars.
The company reported an effective tax rate of 25, 2% and I expect that 2021 tax rate of 24% to 26%.
Yeah.
Cash flow from operations for the quarter was 30 or I'm, sorry, $3 $5 million. This includes a $30 $7 million decrease in accrued payroll and because we called out the timing of the payroll and the impact on the payroll accrual last year, we would point out that the 2021 payroll accruals.
Should have a similar cadence to what we saw last year Q1 had the lowest payroll accrual of four days Q2 should be 11 days Q3, five days and then Q4 13 days in Q4 will also be impacted by one half for $24 million.
The cares act deferred payroll tax repayment that compares to on the on the payroll accrual three days 10 days for days and 12 days that we had in 2020 during corresponding periods, but of course, the payroll accrual only relates to timing and the impact ultimately washes out through the full year.
Continuing to return capital to H C. S. G shareholders, we announced that the board of directors approved an increase in the dividend to <unk> 75 per share payable on June 12.
On the fifth the cash flows and cash balance is supported and with the dividend tax rate in place for them.
For the foreseeable future the cash dividend program continues to be the most tax efficient way to get free cash flow and ultimately maximize return to shareholders. This will mark the 72nd consecutive cash dividend payment since the program was instituted in 2003 and 71 consecutive quarterly increase that's now on <unk>.
June year period. That's included four three for two stock splits we recognize the dividend is important to our shareholders and we have increased it in line with our performance track record. Additionally, the company.
It remains authorized to repurchase one 7 million shares of our common stock pursuant to the previous board of directors authorization and expect to repurchase up to 1 million shares through February of 2022, and with those opening remarks, we'd like to now open up the call for questions.
If you'd like to ask a question at this time. Please press Star then the number one on your next question comes from Sean Dodge with RBC capital markets.
Thanks.
Morning.
Maybe starting with the margins.
Real nice.
Sequential improvement across both segments.
Maybe if you can just talk on the drivers there and then.
You mentioned the potential that growth.
Thank you for getting later this year.
The sustainability of these levels should we expect to see margins come back in a bit here as you begin to ramp for investments.
Okay, Great again.
Hey, good morning, Sean.
You're right we've talked a lot about managing the services, we provide in our costs as efficiently as possible, especially in light of the census pressure that our clients continue to face. So from a go forward perspective, our expectation is to continue managing the staffing the purchasing and the production based on census, and maintain that.
Focus on census recovers.
As to the go forward there is a portion of that margin improvement that we expect will be growth will bring some inefficiencies.
The inefficiencies of an in house operations that we're assuming it takes us for some time to implement our systems and fully.
To get those new opportunities on budget, so 86% remains our target, but we are very much committed to ongoing management of the label for and supply cost as well as cash collections. So we do expect to maintain some of those improvements going forward, we're just not yet in the spot.
Quantified.
Hey, Sean and just to piggyback on Nevada, math answer as well as you as you're well aware, there's a significant portion of that quote unquote margin improvement that is just math right. It's the revenue reduction and the corresponding cost reductions that as census, recovers, which we expect over the next 12 to eight.
18 months that math will work in the other direction. So you have that coupled with the mix of business right and that changing but as Matt highlighted there's a portion with the operational imperative and what we've been focusing on even pre pandemic.
That we believe to be sustainable.
Okay. Thanks, and then on.
The revenue outlook.
We kind of more encouraging outlook for the back half for the year.
Can you walk us through what you need to see what needs to happen for that to take place and you've got the explanation on what other kind of milestones on markers are you looking for.
Okay.
I guess to begin moving forward with that plan.
Implement new facilities.
And maybe Sean on for me, maybe to take a step back to your question in and create some context, and then I'll maybe get into more of the detail on it but youre right in the sense that the vaccine.
It has had an impact a tremendous impact which was a critical first step.
Group driving down cases, and not just the patients and the residents, but also the frontline staff by over 90%. So that when you ask what are we looking for that has led at least this past quarter to stability incentives.
For the quarter. So that's certainly an early indicator of recovery, but as I highlighted in my opening remarks, the path the path and the pace of recovery is still TBD and then even one step further removed overall in longer term.
Why we have so much confidence around recovery is demographics and.
Ultimately it maybe we don't speak about that enough by that instills in us the utmost confidence that census will recover with that mix slightly skewing more long term residents rather than short term patience for reasons, we've talked about before when you think about occupancy recovery and how that relates to <unk> and to your <unk>.
And more specifically to revenue in this environment.
I would think of revenue as a lagging indicator, meaning census, first and then following.
It would be cost and revenue both on the way up and on the way down cost and billings in the context of the customer. So when we think about sector occupancy stabilizing in Q1.
Along with very modest new business adds.
And then really modest facility exits that's why I had mentioned Q2 being flattish like we highlighted even on the previous call, but the back half of the year.
The occupancy certainly stabilization does give us more visibility.
To some customer opportunities in both evs and dining, but especially dining because when you think about di round facility access or lessened and even our own customer assessments.
So on a more straightforward since we had that existing client relationships. So feeling good without being able to pinpoint a number or dollar amount. We're feeling very good that we'll start seeing some sequential growth in maybe in the aggregate comparing first half of this year to second half.
<unk> of this year.
Okay sounds great. Thanks again.
Hey, Thanks, Sean.
Comes from AJ Rice with credit Suisse.
Hi, This is Rob moving on for a J rice. Thanks for taking my question guys.
Around your largest customer Genesis, we've we've seen them divest about 40 facilities in 2020 and talk to at least 70 more in 2021.
Just curious if those facilities rolling off in your kind of outlook for.
Gross opportunities in the second half and then also if you could talk to maybe the retention rate you guys generally have wind facility rolls off for even the process that that takes place when a new operator comes in and if you.
I have a chance to go after that business or what those discussions look like.
Yeah. Good morning, Rob I would say just sort of to speak at a very high level as to kind of the health of the Genesis partnership from the facility level up through the C suite that relationship that partnership remains strong and it's an important one for I would say, both us and for Genesis they've been a great partner.
There is frequent and very open communication and from our perspective, they've continued to pay us within terms, which is an especially important marker as to the health of the relationship and quite honestly Genesis is continuing to execute the plans that they've outlined both publicly and to us right and thats both their portfolio optimization plan.
And continuing to seek relief from landlords and leases.
That portfolio optimization plan being an important part of it right sizing their holdings and really refining their operational focus. So we expect to continue working with the Genesis leadership and to deliver our services at the facility level as to those pending and perhaps even future facility transitions that you allude to as those details unfold.
We expect that at a minimum we will have a seat at the table, we'll have an opportunity to engage with the new operators and determined if maintaining a partnership at those facilities would be mutually beneficial there is a process that unfolds, we largely treat those as a new business opportunity. Obviously, we have insight into the inner workings from an operational perspective of those facilities.
<unk>, but we have to assess the financial health and wellbeing of the acquiring company to make sure that they are a partner with whom we feel comfortable working.
So you know going into it the company's that Genesis has partnered with to date has yielded good.
Good results for us and we've been able to retain.
Almost all if not all of that business. So.
At a minimum we expect to seat at the table, we expect to have those conversations and we're not assuming any loss of that business going forward, but if things change, we'll certainly keep you apprised of any of those developments.
Great. Thank you.
Yes, just one follow on.
For your customer base in general.
Occupancy does seem to be stabilizing in a positive trajectory from here, but it seems the advanced Medicare payments are still meeting moving payback and the payroll taxes, just curious as to how you guys are thinking about.
On a potential increase in bad debt expense at some point or are we kind of out of the woods on that or is there still some risk in the next few quarters and the customer base.
What are you seeing there.
Well I think with certainly with the weekly payment.
Design, we've implemented now going on two years.
We had improved visibility and I think predictability in terms of payment and again, if you look back over the past.
A couple of years eight of the nine eight of the nine last quarters, we collected what we build.
So.
For us it's a matter of daily weekly monthly execution on that so we're never we're never out of the woods regardless of.
How stable or unstable times may be but again with that weekly payment initiative and continued for.
Focus that we have around that part of the business, we feel confident in moving forward and being able to deliver and achieve our goals. Having said that you mentioned you mentioned that the repayment of the Medicare accelerated and advanced payment program, we're going to continue to monitor.
What exact what government both federal and state actions are on the comp, we're taking a bit of a wait and see approach I think in the prior administration. There was a pretty clear line of visibility into how they were thinking of everything and I think the new administration with some of the new appointees, it's still wait and see.
But whether it's the repayment of the accelerated and advance payments that Medicare three day rule waiver.
The cares act now that that's completed on some of the new.
Legislation that's on the horizon.
We're going to monitor that closely and see what impact that could have positive or negative on our customer base in that.
Obviously, we'll determine certain courses of action, we would take with our customers.
Great. Thanks, guys and good job on the quarter.
Oh, Thank you thanks, Rob.
Next question comes from Andy Wittmann with Baird.
Okay, Great I guess I, just wanted to drill in a little bit more on some of the prior questions.
On the growth outlook it sounded it sounded like you know stabilized occupancy.
As for the core reasons, if not the most important reason for the second half a day.
But just in terms of new facilities.
Stupid.
I was hoping you could just comment on what the outlook is.
On the potential for net new facilities recognized instantly amounts of deconsolidation.
Can you just like talk about kind of the pluses and minuses on potential for adding new facilities such as occupancy.
Yeah, Yeah, well I guess, when we think of back half for the year and just to be clear.
I was more highlighting census.
For the purposes of thinking about revenue and the impact that that has.
<unk> had over the past six to 12 months and we will likely have as a tailwind to any revenue.
Growth over the next six to 12 months, but most of my what I was intending to comment around Andy was was more greenfield opportunities. That's when when I talk about having additional visibility into the back half of the year I'm, specifically talking about net new facility growth not just scientists recovery and as a result.
Your point on the deconsolidation.
And the industry, we view that really neutrally right I mean, if you look at our customer base. It really does and has always mirrored the industry at large between net of large national type of operators. The regional players and then the smaller independent operators or even non for profit facilities and certainly that middle bucket the regional type.
Players the bucket that we're seeing with the most growth potential going forward. So that's a good thing for us and it really doesn't change the way that we target the business or sell the business or execute from an op.
Operational perspective, and that we obviously need to assess each facility has its own unique opportunity regardless of the ownership structure or whether that one facility as part of <unk>.
A multi 100 facilities.
Ability chain or its a standalone facility because it's important for us to understand in surveying that facility. How we would staff the building how we would supply at what our cost structure. It looks like specific to that facility assuming that we will.
Honor the sites et cetera, so in that sense.
It doesn't change our prospecting prospects on our prospect play along as the industry evolves.
Got it great.
And then I guess my follow up question, but I just wanted to touch on Covid just haven't heard your response to this one NOI.
No.
Not directly related to anything here in the quarter, but just kind of bigger picture and that's about <unk> <unk>.
Cost.
Kind of dabbled, a little bit and in other classes of senior living including Inc.
Talked about that there might be an opportunity in assisted living dining.
Maybe even other parts of the continuum for for senior care and senior living.
With so much change happening in the sniff world.
I was just wondering if you had any updated thoughts about your desire interest in growing that business out if you've done anything to the market turned down or if you've been really hunkered down and dealing with.
The present day challenges with Covid and on the core business. So just kind of wanted an update there.
Yes.
<unk> always evaluating always assessing and I've talked about before one of the great benefits, we have as a company and being designed in almost a franchise like way with an entrepreneur coronary on spirit throughout the organization is that we are able to trial evaluate on a trial basis when we're inter.
It's data and whether it's a new service line as you said are or a new initiative I would say for the moment, though Andy we've had our hands full just in focusing on the task at hand, which is been COVID-19 within our niche, but still continuing to evaluate new opportunities and there have been new opportunities or new.
<unk>.
Situations at.
We were we were proposed to pursue with all of the changes just in society, and certainly within cleaning and standardization.
<unk> been brought our way so we're going to continue to explore those opportunities but for the moment. Our focus is almost exclusively dedicated to the niche and in navigating our way through with.
For customers this situation and the pandemic.
Okay.
A lot guys have a good day.
Thanks, Andy.
Next question comes from Ryan Daniels with William Blair.
Hey, guys, Nick speak out in for Ryan Congrats.
Congrats on the quarter.
My question I guess.
The first one on be going on from the sales process on if you can provide an update on.
How Smith.
Smiths are kind of allowing you guys come in are you guys on side or is it still kind of a little bit of the Covid era sales profit and fair enough.
Yes.
On a bit earlier, Nick but I would say that for sure.
Sales opportunities that are more imminent for us would be the cross sell of dining services with our existing housekeeping customers.
We haven't spoken about this quite a bit in some time, but we're still less than 50% penetrated in providing dining services to our existing housekeeping customers. So given the lack of access that has been prevalent throughout the industry over the past 13 months or so.
There has been a great opportunity to advance those discussions with our housekeeping and laundry customers some of whom have been.
Waiting for us to provide dining services in their facilities for years now and it's just been a capacity issue, where we have not yet been able to expand and provide those services so that although the.
Kind of shifting paradigm with as it relates to infection prevention of infection control has certainly got a lot of attention from an environmental services perspective for housekeeping and laundry perspective, I'd say most imminent from a growth perspective has been the access allowed to explore those dining opportunities.
On the opportunities such that.
When we are able to access to facilities.
We can do so on a swift manner and of course that has to be coordinated with the local operations team.
Teams from a management capacity perspective to make sure that we're doing a thorough analysis of the facility to make sure that operationally, we can implement our systems and operated according to our budgetary expectations all the while conducting that.
Exceedingly thorough financial analysis of that would be partner, that's always been a really important part of our sales process and obviously in this moment continues to be.
More important than ever so it's that current.
It's a pass in just as much their intention.
To pay us on time and in full so.
As is always the case, there's a lot that goes into it but certainly we're beginning to see loosening of the access.
Sort of limitations that we have faced over the past 13 months and are optimistic that feeding into the back half of the year, we should be well positioned to begin exploring new business adds.
Great. Thanks, and then.
Kind of.
Moving into a little bit more.
Growth.
More normal growth in the second half I'm, assuming kind of given you know the margin profile there is not a large pipeline.
And for your time trainees rate it for you to go.
At the moment is that something that you are starting to kind of build up now.
And will it be.
Yeah.
Hit the ground running type of thing.
For those management have been trained up.
Got it.
Yes, it's actually a bit different than how you.
You pre supposed in the sense that we are actually more on a business as usual environment with respect to management development.
Including the recruiting of the managers so that part is.
Read out throughout the country and there's different areas that has different stages of management development and its always its always the most important part of the business and one of the things that we're always trying to do a better job at but we are essentially normal course of business and management development I would not characterize our thoughts on the second half for.
For the year and the growth opportunities as being normal course, just yet for a business as usual I think that's something we're going to continue to evaluate however, we do feel good that directionally.
From a visibility perspective, we are going to have some opportunities to expand our footprint.
Okay, great. Thanks, guys. Thanks for the color. Thank you.
Next question comes from Brian <unk> with Jefferies.
Hey, guys congrats on the quarter.
Thank you clarified that yeah.
Yeah, no definitely and just to clarify on your comments on the revenue expectations for Q2 on the back half of the year.
On the Genesis assets that are being transferred to programmatically are you assuming that those day with you through the whole year is that.
What are you thinking about that.
Well for us when we're talking about growth, we're not looking at it just on a net basis right that there are certain unknown. So what I've talked about in terms of growth and what we're comfortable talking about is our view on adding new clients, whether they be greenfield for adding additional services through our cross selling of <unk>.
Mining services to an existing Evs client, that's where our our conviction has increased as a result of that visibility, but in terms of trying to predict the future with any customer transition, whether it be an independent mom and pop or otherwise.
The best I think data point to look towards would be our past our past experience, where we're typically successful in retaining greater than 90% of any sort of customer transition.
And for Us and Matt alluded to it earlier, that's foundational to our growth as well.
We're on a constant state of transition with customers and clients, whether it be at the administrative level or owner operator level and we've proven adept at developing those new relationships and then when the when the when the situations present themselves leveraging those relationships for expanding for expanding the company or for growing.
With that new customer so.
Conviction high conviction and with improved visibility that we should see some sequential growth back half of the year compared to first half of the year and I would just point to.
Past being prologue in terms of our expectations around retaining.
Whether it be administrator or principal or owner transitions genesis or otherwise.
Got it and then I guess, just a follow up to the question on consolidation versus deconsolidation as we see some of these new players to emerge like a chromatic on for example, how do you see what are your relationships with the emerging new consolidators are these existing relationships already or are these day.
New opportunities for you guys as things open up in this space.
Yeah. It's interesting Brian this is an industry that tends to be fairly good.
First U S. If not quite incestuous and then certainly exceptionally highly networked right, so whether you're talking about a new regional player or.
Our mom and pop that's building some momentum.
It tends to be that we either are familiar with the principles or if we don't know them directly we know someone who knows them. So it has been.
Fairly fluid for us to gain introductions and to begin to build relationships for with some of the newer operations.
Is that regardless of the owners.
Ownership structure of the complexity of it.
The organizational design the size of their holdings it has to be a bottoms up approach for us in both our targeting on our sales efforts and even ultimately on our contracting and then certainly very clear.
And our operational pull through on execution, so regardless of that top side ownership structure management structure, we certainly want to make sure that we are comfortable with and develop relationships with the C suite and as much as thats applicable.
Much more important for us is the grassroots efforts and and that holds within our district and regional structures Ted alluded to the element of that that relates to management development, but it also holds for business development, where our local operators are responsible to cultivate their relationships and use those relationships as an opportunity on an avenue for future growth. So.
Very much more bottoms up than a.
Top down.
<unk> for us as it relates to new business opportunities.
Got you and then really quick.
Quick for me.
Clarification on the cost of revenue line any call out this quarter workers' comp bad debt the change in fair for the dual rate.
No no nothing is noteworthy.
Does the work comp that you called out from last quarter.
Okay got it thank you.
Thanks, Brian.
Last question comes from Mitra <unk> with Sidoti.
Yes, Hi, yes. Good morning, Thanks for taking the question.
Jeff on the.
Financial health of your clients from the industry in General I believe.
Well I'm going to pass on a $5 billion being allocated towards the industry to help through the pandemic and I was just curious if your clients already using GAAP funding or anything on that.
Yes, I would say Mitra sensus recovery is going to be over the next 12 months to 18 months.
Most critical part of as it relates to the let's say the business recovery if the if the clinical crisis is behind us with the success of the vaccine that business challenges vis vis funding and operating at these to per still depressed census levels anywhere from 10 to 15 points below where they were prior to the <unk>.
Dynamic is going to be the most critical part for that.
And.
I mentioned it in my hope in some of my commentary and responses to the questions, but we're going to keep a close eye on on both federal as well as state actions administrative and otherwise over the coming months to see the commitment levels because whether it's the three day wave.
<unk> three day rule waiver, whether its the accelerated and advanced payment program.
That's in the process of being repaid.
The one 3% increase in Medicare part a payments, which is right now being considered CMS is also at least thinking about recalibrating PDP and.
So theres a lot of moving parts that we're going to keep a close watch on but census, ultimately will be the driving force behind stability financially as well as no that's great.
And then just on the vaccine rollout right now recently.
The article that highlighted.
Good day, maybe above 90% from nursing home residents vaccinated, but maybe only about 60% of healthcare workers within those facilities.
Is that disconnect.
Impacting the ability to maybe.
You might've seen on otherwise.
I don't think so dmitry I think the most important population in that setting who needs to be immunised would be the residents very clearly and I think there's not been data that I've seen that sort of parsed.
The lower vaccination rates among employees relative to those who have had a COVID-19 infection previously and would thus be naturally immune versus those who have flat out outright objected to receiving the vaccine versus those who have received it so.
I have not seen any really good compelling data that show that the disconnect between resident vaccination rates as compared to staffing vaccination rates has had any negative impact.
Act on tamping down infections within the facility because certainly the data that we show with respect to.
Covid infections, among both the residents and the employee populations have gone down far greater than 90%. So we're seeing that very much.
Effective.
Immunization levels within the facilities now interestingly to your point when we have seen some community outbreaks. There has been some level of corresponding facility level outbreaks and that's probably driven by the employee. So there is certainly some credence to the.
Notion that you floated, but generally speaking I would say the predominant focus has been on the residents that's for sure.
Okay. That's great. Thanks for taking the question.
And at this time I will turn the call over to the presenters for closing remarks.
Thank you Sharon.
We know 2021 will still have its share of pandemic related challenges, but the early success of the vaccine coupled with learnings and innovations of the past year is cause for optimism as the industry continues its gradual shift from crisis mode to a state of recovery, our commitment to internal investment and returning capital to <unk>.
Shareholders underscores our positive longer term growth outlook and creates value for all stakeholders.
So on behalf of Matt and all of US at <unk> I wanted to again, thanks, Sharon for hosting the call today and thank you to everyone for participating.
This concludes today's conference call you may now disconnect.
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