Q2 2021 CBRE Group Inc Earnings Call
Greetings welcome to CBRE is.
Second quarter 2021 earnings call at this time, all participants are in a listen only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance. During the conference. Please press star zero on your telephone keypad. Please note. This conference is being recorded I will now turn the conference.
Over to Christian Sarabande, Vice President of Investor Relations and corporate finance. Thank you you may begin.
Good morning, everyone and welcome to CBRE second quarter, 2021 earnings conference call.
Earlier today, we issued a press release announcing our financial results, which.
Which is posted on the Investor Relations page of our website CBRE dotcom, along with a presentation slide deck that you can use to follow along with our prepared remarks as well as an excel file that contains additional supplemental materials.
Separately, we also announced some changes to our leadership team appointing Emma Jim Martino.
Now as global group, President and Chief Financial Officer, and Chief Investment Officer, and Vikram Kohli Global Group President business intelligence.
Before we kick off today's call I'll remind you that this presentation contains forward looking statements that involve a number of risks and uncertainties exam.
Examples.
Statements include our expectations regarding cbre's future growth prospects, including 2021 qualitative outlook and multi year growth framework operations market share capital deployment strategy and share repurchases M&A and investment activity financial performance, including profitability.
<unk> expenses margins adjusted EPS and the effects of both cost savings initiatives and the Covid pandemic, the integration and performance of acquisitions and any other statements regarding matters that are not historical fact, we urge you to consider these factors and remind you that we undertake no obligation to update the information contained on this call to.
Of these subsequent events or circumstances.
You should be aware that these statements should be considered estimates only and certain factors may affect us in the future and could cause actual results to differ materially from those expressed in these forward looking statements.
For a full discussion of the risks and other factors that may impact. These forward looking statements.
Please refer to this morning's earnings release and our most recent annual and quarterly reports filed on form 10-K, and form 10-Q, respectively. We have provided reconciliations of adjusted EPS adjusted EBITDA and net revenue and certain other non-GAAP financial measures included in our remarks to the most directly comparable GAAP measures together.
To reflect explanations of these measures in the appendix of this presentation slide deck, our agenda for this morning's call will be as follows first I'll provide an overview of our quarterly financial results next Bob's Atlantic our president and CEO will provide insight on our Q2 performance, the recently announced Turner and Townsend transaction.
<unk> and today's senior leadership changes following Bob's remarks, Emma will discuss the quarter in detail along with our revised qualitative outlook for 2021, our capital deployment activities and broader investment strategy.
Jim will open up the call for questions now, please turn to slide 4 which highlights our second quarter 2020.
Together with <unk>.
Total revenue grew about 20% to a new second quarter record of nearly 6 and a half a billion dollars well net revenue grew 31% to $3.9 billion, partially driven by a strong rebound in property sales and to a lesser extent leasing as well as favorable foreign currency effects.
The quarter also saw a tangible benefit from last year's transformation initiatives, which have improved our cost structure and operational agility. Adjusted EBITDA grew 169% to $718 million, surpassing Q2, 2019 total by 53% overall adjusted EPS grew 2.
<unk> hundred 91% to $1.36, well GAAP EPS rose, 437% to $1.30, compared with Q2.2019. These metrics were up 68% and 98% respectively. Both adjusted and GAAP EPS in the prior year's second quarter included a 10 cent headwind from incremental Covid related.
Cost and a terrible contribution to Covid relief efforts. Additionally, certain venture capital investments contributed 2 cents to GAAP and adjusted EPS. This quarter. The fact, all key financial metrics significantly surpassed Q2.2019 levels is a testament to the resiliency of our business and the actions we.
And to create a business prime to deliver scalable and enduring Chris now for a deeper insights. Please turn to slide 6 for Bobs remarks, Bob.
Thanks, Christian and good morning, everyone.
As you've seen from the results Christian just summarized CBRE continues to benefit from the multi year efforts to.
We have our business across 4 dimensions.
Asset type business line client type and geography.
We've moved decisively to capitalize on this opportunity and are making investments and driving organic growth initiatives that will continue this trend.
<unk> diverse overall Q2.2021, adjusted EBITDA grew at a better than 20% compounded rate from Q2.2019 with strong growth across all 3 business segments.
Each segment experienced significant margin expansion over this 2 year period due to.
Oh disciplined expense management, along with the benefits of diversification.
Thoughtful investments shaped by a well developed strategy will play a central role as we continue to grow and diversify our business across asset types.
Business line client type and geography.
Our.
Our balance sheet was very strong going into Covid and has strengthened further as we emerge from the pandemic.
We are putting some of this balance sheet capacity to work with a particular focus on investing in secular Lee favorite companies that enhance our ability to provide clients with customized solutions.
And we will benefit from our relationship with CBRE.
You saw this earlier this year when we acquired a 40% ownership interest in industrious in the flex space Arena and again this month with our specs sponsorship of voltage power and the commercial and industrial solar energy.
<unk> sector on Tuesday, we announced a $1.3 billion purchase of a 60% stake in Turner and Townsend a global leader in project program and cost management.
This is a great brand and great management team operating in sectors with favorable long term growth profile.
Niels Turner and Townsend will advance diversification across the 4 dimensions of our business that we've been discussing.
For example across asset types Turner, and Townsend brings his capabilities and infrastructure and Green energy, where they can help support our efforts to meet our clients' carbon reduction.
<unk> goals.
They are the global leader in cost consultancy.
Line of business, where we have a small practice now.
Geographically they move our project management business into new markets in Asia, and the Middle East, while we can help them grow in the Americas and elsewhere.
And they add an array of.
Clients around the world, most notably in the government sector.
We look forward to hitting the ground running with Turner and Townsend when the transaction closes later this year.
Before concluding I'll briefly comment on the leadership changes we announced this morning.
Over the past several years, we've evolved our.
Our senior leadership team dramatically <unk>.
Identifying our most compelling executives and putting them in roles, where they can have the greatest impact on our business.
The elevation of Mgo, Martino and Vikram Kohli, the global group President roles represents another step in this direction.
Consolidating our capital.
Basement, and finance functions under Emma reflects the growing importance of capital allocation to the long term growth aspirations that we outlined at the end of last year.
She has proven to be an accomplished investor of our capital who has an exceptional ability to work effectively with our leaders around the world.
To execute our capital strategy.
Vikram has rapidly emerged as a leader with a unique ability to harness data and insight from across our business as well as from external sources.
And like Gamma he has excelled at working across our global platform.
Adding our strategy and digital and technology functions to his mandate will create a business intelligence capability that will better enable us to make powerful fact based decisions.
As we guide the company's growth.
Vikram is the first seabury executives from outside the U S to ascend to this.
<unk> level in the company.
We expect to elevate other executives from outside the U S into senior global leadership roles as we continue to put our best talent into key positions.
Leah Stearns will remain with us through year end to ensure a smooth transition of financial leadership responsibilities.
I want to thank Leah for her vision and initiating the transformation of our finance organization.
Managing finance through the worst of the COVID-19 crisis, and together with Kristen, taking our Investor Relations program to a new level, including articulating the financial framework for our long term growth.
Exploration.
We wish Leah continued success.
With that I'll turn the call over to Emma.
Bob It's a pleasure to be speaking with you all today and I look forward to regularly engaging with you in my new capacity as CFO.
With that please turn to slide 8.
Advisory services net revenue and segment operating profit.
It set new second quarter records, driving 47% and 130% versus Q2.2020, notably they surpass our previous Q2, 2019 peaks by 3% and 18% respectively.
While leasing revenue climbed 33% compared to the prior year it.
It was about 18% below.
2.2019 levels, mostly due to subdued Americas office leasing.
Overall leasing revenue rose year over year by 26% in the Americas, 61% in EMEA, and 40% and APAC Americas performance was about 28% below Q2, 2019, while EMEA and APAC were about 21% in <unk>.
Our Q10 above young.
<unk> just the recent and prevents an Americas leasing with July thus far up significantly compared to both 2020 and 2019.
As expected property sales improved markedly with revenue growing 152% from the prior year period, Americas, EMEA and APAC property.
14 for revenue surged, 158%, 132% and 151% respectively.
All regions eclipsed our Q2.2019 level with total property sales revenue about 27% above Q2, 2019, the macroeconomic backdrop and supportive of real estate investments and global capital.
Capital migration continues to steadily improve.
Rising property sales also helped to catalyze strong growth in commercial mortgage originations, which climbed to 61% we saw particularly strong demand for acquisition and construction financing and recapitalization.
Our loan servicing portfolio grew 20% versus the prior year and.
And 3% sequentially to over 294 billion, partially driven by strong retention of loans brokered and originated thus led to loan servicing revenue growth of over 15% compared to Q2.2020.
Evaluation revenue accelerated over 37% is transaction related work picked up activity is particularly strong in.
For valuation revenue increased nearly 47%.
Finally property management net revenue increased over 6% EMEA and APAC grew strongly while Americas lagged due to a previous decision to exit some low margin contracts.
Moving to slide 9 global workplace solutions continued its.
Long record of resilient growth with net revenue rising 11%.
This reflected strong growth in project management up 15% and facilities management up 10% driven by elevated local facilities management and datacenter assignments as long as the benefit of favorable foreign currency translation.
Segment operating profit rose over 30.
33%, reflecting solid top line growth disciplined cost management and the benefit of a mix shift to higher margin work and the impact of last year's transformation initiatives, which more than offset increased medical expenses.
Even accounting for about $17 million of transitory Covid related expenses in last year's Q2 segment operating profit growth.
It was up 18%.
Importantly, our new business pipeline continues to be strong and well diversified with a high concentration of life Sciences logistics and technology companies, along with new data center activity.
Turning to slide 10.
Our real estate investments segment generated over $153 million of segment.
Growth in trading profit for passing its previous quarterly high by $38 million impressive development operating profit of nearly $120 million was fueled by a large office property sales that commanded strong valuations due to the high quality of the assets and tenancy importantly, our pipeline and in process portfolio, both set new highs this quarter.
<unk> opt to $9.6 billion and $15.2 billion, respectively. This growth was largely driven by fee based office and industrial work for Blue Chip occupier clients.
Investment management revenue grew 35% to $139 million fueled by a 29% increase in asset management fees higher acquisition and disposition.
Rising carried interest and favorable FX translation.
Assets under management rose, 18% versus the prior year to a new record of more than 129 billion.
Stepping up the growth of this business has been a strategic focus and were pleased with our progress. This strong topline growth coupled with careful expense management.
Drove operating profit growth of 38%.
Lastly, harness operating loss narrowed sequentially to $9 million, we expect a further narrowing of this loss going forward is all hottest sites are now operated by industrial and all Hunter sites, except for 4 legacy units are now owned by industrial <unk>, the future financial impact of our.
Our industrial stake, which will be marked to market as a value changes will be reflected in advisory.
On Slide 11, we'll look at our new qualitative outlook for the year.
We now expect full year advisory sales and leasing revenue on a combined basis will likely approach 2019 levels with sales likely to moderately exceed prior.
And leasing likely to be roughly 15% or so shy of peak, we anticipate year over year sales and leasing revenue growth rates will likely moderate as we move further into the second half of the year on year over year comparisons will be tougher than in Q2 when activity last year was at a virtual standstill.
As noted previously Q3 leasing.
Peak to a strong start but we continue to monitor the potential delta variant impact on transaction volume we've learned over the past 15 months that office leasing is highly correlated with companies returning to the office.
Given this as we've started to see some U S. Based company is modestly delayed return to office dates. We believe there is the potential for this to impact the <unk>.
<unk> is already we've seen quarter to date.
Across the rest of our advisory business, we expect revenue to rise in the low double digit range versus the high single digit growth. We anticipated previously we also expect a more robust advisory revenue projections will flow through into incremental margin expansion relative relative to our previous expectation.
Moving to Gws, we are modestly raising our expectations for segment operating profit, while maintaining our revenue forecast in the high single digit range net revenue is expected to slightly exceed this range, we're benefiting from a shift in service mix and exemplary cost discipline. As a result, we now expect gws segment operating profit to grow.
<unk> kind of high teens rate this year.
A slight improvement from our previous expectations.
Our updated gws expectations include some incremental operating expense investments in the second half and do not include any benefit from our announced Turner and Townsend transaction.
Looking at Rei, we expect this segment to nearly doubled 2020.
Grow at around at higher profitability in.
In investment management, we expect revenue to surpass $500 million and profit to rise at least at a high teens rate from the $140 million achieved in 2020.
We project development operating profit to more than double versus 2020 and to roughly triple its 2019 contribution of 122 million.
We are developing product and strong markets and sectors with supportive fundamentals and have a solid pipeline for asset monetization.
This is expected to translate into Q3 operating profits that are likely to be at least as high as Q2, given the robust pipeline and in process activity. We are optimistic about the long term trajectory of this business.
And expect it to be a meaningful contributor to our long term growth.
Consolidated adjusted EBITDA margin on net revenue should significantly exceed the level achieved in 2019, even though we expect a modest uptick in corporate expenses as compared to that year.
The return of high margin sales revenue the effects of last year's transformation.
It is and strong development gains are drivers of the improved outlook.
Overall, we now project our 2021 adjusted EPS to surpass our 2019 pre pandemic peak of $3.71.
By a wider margin than we expected at the end of the first quarter as usual, we will realize more than half of our earnings in the.
Second half, but given our year to date performance those earnings will be slightly more weighted to the first half and they have been in most years.
Flipping to slide 12.
Over the last year, we've allocated about $2 billion in total, including about $1.9 billion for capital expenditures investments in sponsorships and partnerships and M&A.
Initial inclusive of our pending Turner and Townsend transaction, while returning cash to shareholders by buying back approximately $88 million of shares.
Still net leverage remains modest at Jack 0.2 times pro forma for the expected closing payment of the Turner and Townsend transaction, we have significant capacity to invest in growth.
<unk> diversification using our 4 pronged investment approach consisting of sponsorships partnerships acquisitions and building our own resources and capabilities.
Our strong balance sheet, coupled with the strategic moves we've made over the last year and market leading position give us great confidence that we can deliver a compelling and scalable growth for.
<unk> Entercom looking ahead, we believe we are firmly on track to achieve the growth aspiration, we outlined in February at least low double digit average annual earnings growth through at least 2025 absent a downturn with meaningful upside from incremental capital allocation.
With that operator, please open the line for questions.
For years, if he would like to ask a question. Please press star 1 on your telephone keypad, a confirmation tone will indicate your line is in the question queue. You May Press Star 2 if you would like to remove your question from the queue.
For participants using speaker equipment, it may be necessary to pick up the handset before pressing the star keys.
Our first question is from Anthony <unk>.
How long with J P. Morgan. Please proceed.
Hi, Thanks, Good morning, and welcome them to make sure. My first question is just to clarify a comment you made about first half versus second half earnings.
Is.
Hey, Matt.
First half of 2021 will be greater and what you think the second half will be or just that the sports a little bit more even in a strong I sure I understood the comment.
The split will be a little bit more even so the first half comp for 2020, obviously is much easier than the second half they are expecting.
<unk> the shift in our earnings to be more weighted to move more towards the first half, but we still expect the majority of it to be in the second half.
Okay understood and then.
On the leasing side.
Yes.
Not picked up as much as capital markets.
Interest and maybe your view.
View as to whether it's just capital markets activity are surprised on the upside or if we should maybe underperforming expectations.
Tony.
Would say, it's both capital markets, who is doing quite well there is a huge amount of capital interested.
Real estate, obviously aimed at certain asset classes for instance, anything related to industrial distribution multifamily data centers. There is a lot of capital aimed at those assets a lot of trading going on and obviously, we're a big.
In those arenas, so it's coming through in our numbers as it really.
In commercial leasing its what it has been there is real uncertainty about how and when.
Companies will go back to the office post Covid and as long as that overhang is out there decisions will be made more slowly than they have been historically now as as <unk> seen over the past few months with the vaccination.
<unk> more people were back in the office more decisions were being made commitments were being made but we're I would say we can be certain about 2 things.
We probably won't go back to where we were pre COVID-19.
We will definitively go back to a level that's far beyond what it has been in the past 15.
15 months right the decision making process around office space has just been extremely muted and that's not going to sustain once we get to the other side of Covid.
Got it do you have a sense as to where your office leasing revenue.
Ran in the second quarter versus say 2019 levels.
It could seem like a lot of the other areas or are above.
So offering office leasing revenue came down to 47% of our total leasing revenue globally.
2020 was it was 54% so it came down 7%.
Okay.
Got it.
And then just a watch item for me 1 on the investment activity, you've announced or completed so far this year in particular as it relates to Turner and Townsend can you give a sense as to like what the aggregate EBITDA contribution.
It's likely to beef, Matt I know you gave some numbers with Turner in town.
And in terms of their trailing.
Trying to understand if like you anticipate cost saves your forward growth just trying to understand like what the what the pickup is likely to be for you all from the capital being put out the door yet.
Yep, So so historically Turner and Townsend has shown very consistent mid teens.
Both the net revenue and EBITDA.
And through 2021, and you probably saw their revenue was pretty flat they only got 3% and EBITDA was up significantly.
So going forward, we're expecting them to continue to hit those.
Mid double digit.
Revenue mid teens revenue and EBITDA CAGR is but I will say that for 2022.
We're expecting EBITDA to be in line with 2021 as costs come back in.
Post COVID-19.
Even as revenue increases.
Okay, and any anything substantial from the other.
Once you've made in terms of EBITDA contribution.
No we've done a few infill acquisitions for industrious, we have not revalued that investment because it was a reason we expect to do that later that year. So you won't see any.
Some impact from from industrial this year.
Okay, great. Thanks for the time.
Our next question is from Steve Zaslow with Evercore ISI. Please proceed.
Thanks, Good morning, and welcome Emma.
I guess first quest.
Maybe for Bob.
When you sort of looked at Turner and talented I'm. Just wondering can you just sort of talk a little bit about how the contracts that they have are structured maybe more from just the length of contract and maybe contrast that to the contracts you have in the gws business. It looks like there are EBITDA margins much higher than.
And what you have in gws, but I'm just trying to understand maybe the length of contract and the cyclicality of that business.
Well that business has not been cyclical as Emma said, they've been a steady double digit grower on the top and bottom line for the last decade.
The nature of the projects they work on.
And 1 of the things Steve that was so attractive about them are really.
Benefiting from secular tailwind, so theyre doing stuff in the Green energy Arena and the infrastructure arena, they're doing very large complex projects for corporates that spanned several years so.
The decision, making that underpins those.
<unk> contracts with corporates aren't about what's going on in the current cycle, they're about what their long term needs are so we expect we expect this to be an acquisition that contributes to the resiliency of our business.
They operated a different margin level because they don't have the same level of pass throughs, we do for instance.
Its 1 thing they don't do as principal contracting, which we do which of course has big pass throughs, but theyre doing some massive projects around the world give you an example.
They're doing the hydro.
Project in New South Wales in Australia that will be the largest renewable project in the country of.
Will you ever Theyre doing the they are working on the Virgin Hydro hydro linked it's so well known in India, that's going to connect the big cities in India that will go on for years and years and years. My guess is their role and that will grow over time. There. They are involved in the program management and the ongoing cost management when they take on projects like this.
So they are very resilient and they are a high margin company and they're a real grower.
Okay. So is it fair to say the contracts or at.
At least as long maybe longer than what you would typically see in your gws business.
A big complex projects like that last.
Austria has in years.
I'll give you. Another example, theyre working on a $6 billion redevelopment at the Toronto Airport.
Any others that have gone to airports and seen these projects now they just they go on for a long time. So yes, those contracts are very long term.
Okay. Thanks.
And then when you just sort of look at the balance.
<unk> got obviously very under Levered.
And Youre looking to deploy capital I mean, do you expect to sort of find other deals like Turner and Townsend or do you expect to do more small tuck in acquisitions in the advisory business or on the development side I'm, just trying to get more of a strategic.
TJ sense for where you'll deploy kind of the next large chunks of capital or as it moves more into buybacks, how do we think about that.
Yes, so we still have a very strong M&A pipeline and Inc. We're going to look to do more deals like Turner and Townsend.
Also continue to do our programmatic M&A.
<unk> or Intel, but I think you'll see a mix of both and our real focus is on finding targets that.
Can really help push our strategy, Florida forward, our diversification strategy across asset type business lines client types and geographies that Bob has talked about with all of you many times.
And so we're going to look for.
Strategic M&A, we're not going to force it and.
If we can't find the right opportunities are obviously long term return cash to shareholders.
Yes.
Got it thanks, that's it for me.
As a reminder, the star 1 on your telephone keypad, if he would like to ask a question our next.
Is from Jade Rahmani with Kay VW. Please proceed.
Thank you very much to what extent do you think that the surge in capital markets reflects pre.
Prior transactions that perhaps either were postponed or put on hold took longer.
Closed things of that nature just.
Just getting questions from investors about sustainability of the capital markets growth that youre seeing.
Yeah, Jay there there was some pent up demand that came through in the marketplace.
But when you ask about capital markets in the <unk>.
<unk> real estate sector, you have to look at the alternative places capital can go.
And as you know there is a lot of capital around the world and prices are high in most asset classes stocks et cetera, and so real estate has proven to be a much better asset class over.
<unk>, a decade and there are certain portions certain asset classes within real estate that appear to be particularly strong and we've talked about them over and over multifamily data centers.
Anything industrial.
Anything by the way in the office arena that are new high quality buildings.
The last great tenants, especially tech tenants, there's a lot of capital for those buildings still and so what youre seeing is a lot of capital out there in general.
A considerable portion of it is concluded the commercial real estate is a good place to be and then some asset classes within commercial real estate that appear to be performing.
Extremely well with lots of headway to continue to perform well and so yeah. There was a little pent up demand coming through but our view is that this is going to this is going to sustain for years.
And can you talk to the mix, perhaps across the overall revenue profile of CBRE today.
Things with property type.
How much would be derived from office, how much would be from those other sectors that you've mentioned.
So unless I gave some of the stats on leasing before we're at 47% of office globally, 32% industrial on the sales.
<unk> sighed offices down to 18% in the industrials that 28%.
The advisory services margin improvement was notable.
Was wondering how much you think reflected the increased capital market mix and how much do you think relates.
But there is some costs that perhaps are running below normalized levels, such as marketing spend teeny.
Things of that nature.
I think it's a it's a mix of both we have some higher margin revenue coming on and then we do have some costs that are onetime in nature, and we will come back.
But we think the majority of that margin is sustainable.
Thank you very much.
Our next question is from Anthony <unk> with J P. Morgan. Please proceed.
Alright. Thanks.
Just wondering if you could help on on Trammell Crow.
And just the development business, if there's a way to put some sort of rule of thumb or guidepost around your.
You build something for your clients or it gets monetized and you produce a dollar of profit how much of that.
It goes back on average to CBRE and then.
Of that amount how much goes into EBITDA. After you pay your people.
Yeah, Tony I'll I'll talk about that and it's very relevant to this structure, we put in place by the way with.
Turner and Townsend so the Trammell Crow company model generally works the following way.
When we generate earnings there's 2 levels of compensation commitment to go to our developers and those who manage our development business and that totals around 40%.
The total profit that then gets sick.
<unk> the other 60% goes into.
Our earnings that's the way that works. So when you look at this Turner and Townsend.
Model that we've now just executed on or we will close on later this year very very similar structure 1 of the reasons. We're so excited Trammell Crow company has thrived subject to this structure, we think Turner Townsend will drive strong subject to the structure very.
Motivational to professionals in the business very aligning between the company and the professionals in the business.
And you've seen the results you've seen our profits now and Trammell Crow company or.
Over 6 times, what they were pre financial crisis, when we bought that business.
So.
Just to make sure I understand that so like for instance, if travel card.
<unk> building for $100.
And Charles it for.
$130 and you get this $30 of profit, let's say.
Your institutional partners.
They get the bulk of that like what piece of that do you think goes to CBRE is it like 20% or.
Well it defers on.
Some some some development deals will do on balance sheet not not many but some we will particularly if they have a user identified.
And then we have various kinds.
Structures, but for the most part.
If you look at the total project profit that comes out of a deal maybe 30% of it comes to us sometimes more than that and then we apply those splits that I just described between the company and the developers.
Got it sort of that 30 then.
Then the 40.
It goes to the people in 60 to the EBITDA.
Yeah, No I will say this when we do build to suits, where we do fee deals those are a 100% company owned projects. There is no third party capital associated with those typically.
I see.
Okay great.
Alright Thats helpful.
[noise] frame it.
Given that you've laid out you know size of what's under construction of the pipeline. So that's real helpful. Thank you.
Yeah.
We have reached the end of our question and answer session I would like to turn the conference back over to management for closing comments.
Thanks to everyone for being with US and we look forward to talking to you again at the end of the third quarter.
Thank you. This does conclude today's conference you may disconnect. Your lines at this time and thank you for your participation.
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Jim.
Mhm.
Okay.
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Jim.
Okay.
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Okay.
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Yes.
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