Q2 2021 LTC Properties Inc Earnings Call
Good day, everyone and welcome to the LTC.
The properties second quarter analyst and Investor call, all participants will be in a listen only mode should you need assistance. Please signal of a conference specialist by pressing the Starkey followed by zero.
For today's presentation will be on opportunities to ask questions to ask the question. You May Press Star then 1 on your Touchtone phone to withdraw your question. Please press Star then 2.
Before management begins with the presentation. Please note that today's comments, including the question and answer session May include forward looking statements subject to risks and uncertainties that could cause actual results and events to differ materially. These risks and uncertainties are detailed in the L. T..6 properties filings with the Securities and Exchange Commission from time to time.
Including the company's most recent 10-K date of December 31.2020.
LTC undertakes no obligation to revise or update these forward looking statements to reflect events or circumstances. After the date of this presentation. Please note that this event is being recorded I would now like to turn the conference over to Wendy Simpson. Please go ahead.
Thank you operator, and welcome everybody joining us today for LTC 2021 second quarter conference call with me on the call are Pam Kessler, our president and Chief Financial Officer, and Clint Malin co President and Chief investment Officer.
Not being able to quantify an impact.
Of the Delta variant on current and near future operations, what we have recently heard from our operators. It gives us some optimism.
We are seeing occupancy gains for the first time in a long while.
Vaccination rates among patients and residents throughout the industry are high generally in the 80 per.
Percent range with gradual increase as expected.
Our buildings are beginning to stabilize with in person tours and families visit a lot of once again notwithstanding the recent introduction of the Delta variant.
The transition of our senior lifestyle portfolio is virtually complete.
We are seeing a nice pickup in deal flow and activity.
We are seeing a few encouraging signs throughout the industry.
According to Nic data communities on nursing centers are doing much better clinically than they have in some time given the high rate of vaccinations among residents and patients.
On average, especially with respect to sniff occupancy is trending slowly upward over the last 25 weeks sniffs have seen occupancy rise and each week, except 1 when census remained flat.
Various government stimulus programs.
<unk> have helped significantly and keeping skilled nursing operators of float over the course of the pandemic.
Additionally, there is about 25 billion remaining for distribution to all health care providers and the provider relief fund, while private pay has not been a beneficiary of adequate government relief.
To date, we are seeing some signs that more aid may become available soon.
This is not to say unfortunately that all of the challenges facing our industry are slowly trending downward labor.
Labor continues to be a major challenge for operators and interest rates of inflation or something.
Watching carefully.
Even so I believe our industry is on more solid footing today than it has been over the last 18 months and I'm hopeful that some of the remaining pressures will begin to ease in the coming months.
That said, however, a serious surge of the Covid delta variant across the country.
We're wide, especially in states with lower vaccination rates amongst staff could result in the need to stop admissions again temporarily.
Delaying a full recovery.
But hopefully any such Serge will be addressed locally rather than buy of national Egypt.
Second quarter rent and mortgage interest.
The comp collections were 93, 6%, excluding senior lifestyle and senior care.
And 86, 1%, excluding just senior lifestyle who's transitioned Clint will discuss in detail.
We are no longer seeing new substantial requests for rent deferrals and abatements.
<unk> and if the new ones arise we will review each on a case by case basis, keeping in mind, an operator's ongoing operations rent coverage corporate financial health and liquidity.
We expect to continue providing some amount of relief in the form of deferrals and abatements until occupancy gains.
Gains become more permanent.
I'm, so very pleased to be able to report that the senior lifestyle portfolio transition is nearly complete.
19 of the buildings have been or shortly will be under new leases the.
The other for properties in the portfolio have been sold.
We'll provide more details.
Comments.
With respect to senior care Centers' bankruptcy proceedings are continuing with the next scheduled court date on August 11th.
Building on the uptick we saw towards the end of the last quarter deal flow continues to accelerate with several potential transactions in the pipeline.
And as our investment criteria.
These opportunities are mostly shorter term in cash flow strategic with what we believe are reduced risk profiles and strong returns.
Through the first half of the year, we have actively reviewed a host of transactions passing on most either because of the properties are not performing.
That meet all of our the asking prices don't reflect what we believe to be market value rates.
We have no problem temporarily remaining on the sidelines for our more traditional long term investments until we can find the right deal at the right price the.
Of the opportunities. We are currently working through include mostly structured finance transactions.
<unk> wells and span the full spectrum of care. It bears repeating that LTC has ample access to liquidity to act on these opportunities when the timing is right, but as a good financial steward, we will not enter into a deal that does not produce accretive returns for LTC and our shareholders.
With.
<unk> 2 of our dividend I'd like to repeat what I said last quarter. It has been ltc's practice to support a dividend payout ratio of approximately 80% of fad.
As a result of the financial support we have provided some of our operators and the significant senior lifestyle and senior care defaults or second.
Quarter 2021 dividend payout ratio was 98%.
However, we believe our 2022 fad will improve as we fully transition the senior lifestyle portfolio to more stable operators and the issues related to the senior care bankruptcy are resolved.
At this time, we will provide guidance for the third quarter.
We expect similar NAREIT <unk> results as we reported for the just completed the second quarter.
This guidance does not include recovery of any deferred rent or any rent payment from senior care.
With that I'll turn things.
Over to Pam.
Wendy.
Total revenue increased 9.6 million compared with last year's second quarter, resulting primarily from a $9.5 million increase in rental revenue, which was due to a $17.7 million write off in last year's second quarter related to senior lifestyle straight line rent and lease incentives.
<unk>, just completed development projects and higher rent payments from anthem also contributed to the increase.
The increase in revenue was partially offset by reduced rent from senior lifestyle net of rent received from releasing of 11 properties in the portfolio defaulted senior care lease obligations abated in deferred rent and a decrease in prop.
Balance ex revenue.
Interest income increased 113000 from the prior year due to the funding of expansion and renovation projects offset by scheduled principal paydowns.
Interest expense decreased by 686000 due to scheduled principal paydowns on our senior unsecured notes lower.
Interest rates and a lower outstanding balance under our line of credit partially offset by lower capitalized interest in 2021.
Property tax expense decreased 311000, compared with last year's second quarter as the result of the timing of certain operators property tax escrow receipts and the payment of related taxes, partially offset.
By completed development projects.
G&A was $757000 greater than last year due to the timing of accruals for incentive compensation salary increases on restricted stock vesting.
Income from unconsolidated joint ventures increased 376000 due to mezzanine loan fundings.
During last year's second quarter, we recognized a loss on liquidation of unconsolidated joint ventures of 620000 related to the sale of the for properties comprising our unconsolidated real estate joint venture with an affiliate of senior lifestyle.
During the second quarter of 2021, we recognized a net gain on sale of real.
Real estate of $5.5 million related to the sale of 3 properties in Wisconsin in a closed the property in Nebraska, all previously leased to senior lifestyle.
We also transitioned of memory care property in Colorado previously operated by senior lifestyle to an operator, new to LTC the lease of a 5 year term and provides the purchase.
<unk> for $5.5 million, which is exercisable after the first year of the lease cash rent starting in the second year of the lease is 150000, increasing to 300000 in the third year and escalating 2% annually thereafter.
Net income available to common shareholders for the second quarter of 2021 increased by 16.
$16.4 million, primarily due to the senior lifestyle write off in the prior year and the gain on sale of the 3 Wisconsin properties. This year.
This was partially offset by the revenue declines previously detailed.
NAREIT <unk> for fully diluted share increased to 57.
From 31 cents last year.
Excluding nonrecurring items related to last year's second quarter <unk> per fully diluted share was 57 cents this quarter and 76 cents in the second quarter of 2020.
The decrease was principally due to the nonpayment of rent by senior lifestyle and senior care.
During the 2021 second quarter.
We paid $41 million under our unsecured revolving line of credit. Additionally, we maintained our 19th cent per share of monthly dividend by paying our shareholders $22.4 million in common dividends during the quarter.
Subsequent to the end of the second quarter, we entered into lease agreements covering the remaining properties in the senior lifestyle portfolio.
Order, which Clint will discuss shortly and so the skilled nursing center in Washington, or $7.7 million, we received proceeds totaling $7.2 million and expect to recognize the gain on sale of $2.6 million.
Additionally, we paid $25.2 million in regular scheduled principal payments under our senior.
Palio cared notes and borrowed 19 million under our unsecured revolving line of credit at 1.2%.
The result of this activity, we now have $5.7 million in cash $515.1 million available on our line of credit under which $84.9 million as outstanding and $200 million under our ATM program.
Graham, providing LTC with liquidity of nearly $721 million.
It is important to note that we have no significant long term debt maturities over the next 5 years.
At the end of the 2021 second quarter, our credit metrics remained strong with a debt to annualized adjusted EBITDA for real estate of 5.3 times.
On annualized adjusted fixed charge coverage ratio of 4.3 times and a debt to enterprise value of 29%.
We expect to see this 5.3 ratio come down as we receive more rent from assets, formerly operated by senior lifestyle and eventually we expect to be able to collect rent from assets involved in the most recent.
And the senior care bankruptcy.
Next I'll discuss rent deferrals and abatements as Wendy mentioned, excluding senior care and senior lifestyle. We collected 93, 6% of second quarter rent and mortgage interest income, we provided $1.1 million in rent deferrals and $1.1 million in rent abatements.
Recent as a reminder, senior lifestyle did not pay us rent in 2021 with the portfolio of virtually fully transitioned we are receiving contractual rent from the operators who know lease these properties.
Additionally, during the second quarter senior care did not pay rent we applied the remaining 889000 of the 2.
1 million letter of credit to satisfy certain obligations owed under the master lease in the second quarter.
As of June 30th Senior Care's on accrued outstanding rent balance was $3.1 million.
In July we provided rent deferrals totaling 366000 and rent abatements of 320.
The point without them.
We have agreed to provide rent deferrals of up to 493000 and abatements of up to 319000 for each of August and September 2021.
Now I'd like to turn the call over to Clint.
Thank you Pam.
As Wendy discussed our senior lifestyle portfolio.
Now nearly fully trends.
3 of them and I'm excited to provide our final update on the transition of.
Speaking of some detail about the newest transactions well I will start with a brief recap of the transactions completed earlier this year.
In total the senior lifestyle portfolio included 23 properties 12 of which were transitioned through April.
Transition.
6 of those communities were transferred the Randal residents the current LTC operator volume.
So all of the Oncor senior living and operator, new to us and 1 of the grateful Grateful senior living also new to us.
Of the remaining 11 properties for were sold in the second quarter 3 of assisted living communities.
All of the XI moves Johnson were sold for 35 million, which roughly approximates the combined gross book value. We used the net proceeds of approximately $33.9 million to pay down our unsecured revolving line of credit.
In total these properties included 263 units.
The fourth was a pre.
Obviously closed property sold for 900000 for an alternative use the gross book value. When we acquired it in 1997 was $2.5 million of the net book value was $1.1 million.
Of the remaining 7 buildings in the portfolio 3 have been transferred and for our awaiting licensure.
Sure.
2 properties are being operated by Juniper in Pennsylvania.
1 property in New Jersey also to be operated by Juniper should be receiving the license or any of the <unk>.
On buying these communities include 168 units.
Juniper has been of close partner of Ltc's since 2012 the.
The new lease.
<unk> has a 2 year term with zero cash rent for the first 3 months.
After that time cash flow will be reset based on mutually agreed upon fair market rent.
Cash rent will be reset every 3 months for the first year and twice a year for the second year as cash flow on the buildings improves.
Until we set permanent rates for the longer term free.
The properties in Nebraska.
With a combined 119 units will be operated by Oxford senior living and existing LTC partners. Since 2012 as soon as licensure is received which we also expect in short order.
Police follows the same pattern as I described for Juniper.
1 property in Wisconsin is now being operated by a regional partner New to LTC. This community includes 101 units and will be operated under a 10 year lease with 3.5 year renewal terms cash rent under the new lease is 920 <unk>.
The net in the first year $1.2 million in the second year $1.3 million in the third year, then escalating 2% annually thereafter.
I'll complete my remarks about the senior lifestyle portfolio by saying that among the properties that were transitioned in the January and February timeframe, especially in markets that did not have.
Have stringent lockdowns during that time occupancy increased under new management, sometimes of meaningfully.
Next I'll provide some detail on our most recent development projects that are now operational.
Weatherly court operated by fields senior living in Oregon began accepting residents last September at.
For 30 occupancy was 36% up from 24% on March 31.
The ignite medical resort in Blue Springs, located in Missouri began welcoming patients last October.
At June 30 occupancy rose nicely to 83% up from 64% on March 31.
Yeah.
Moving next to our portfolio of numbers. Please remember that with the pandemic and the challenging environment. It created we don't believe coverage is a good indicator of future performance at this time.
And we are focused mainly on the occupancy trends, which I'll discuss shortly.
Q1, trailing 12 month EBITDAR.
At June EBITDAR coverage as reported using a 5% management fee was <unk> 99 times and 8 times, respectively for our assisted living portfolio.
Excluding stimulus funds received by our operators coverage was <unk> 85 times and points of 6.7 times respectively.
<unk>, excluding senior lifestyle from our assisted living portfolio.
As reported EBITDAR and EBITDAR coverages would increase to 1.03 times and 8.4 times respectively.
Excluding both senior lifestyle and stimulus funds EBITDAR and EBITDAR coverages wouldn't be point.
9 times, and <unk> 71 times, respectively.
For our skilled nursing portfolio as reported EBITDAR and EBITDAR coverage was 194 times and 1 for 9 times respectively.
Excluding stimulus funds coverage was 1.4 for Tom.
<unk> and 1.02 times respectively.
Excluding senior care from our skilled portfolio as reported EBITDAR and EBITDAR coverages with increase to 198 times and 1.5 times respectively.
Excluding both senior care and stimulus funds.
Point, the DARPA and the EBITDAR coverages would be 152 times and 1.06 times respectively.
Now for some occupancy trends, which are as of July 15th as a reminder, for our private pay portfolio occupancy is as of that date, specifically and for our skilled.
Portfolio occupancy of the average for the month because of our partners have given this data to us on a voluntary on expedited basis. The information. We are providing includes approximately 70% of our total private pay units and approximately 73% for our skilled nursing beds.
Private pay occupancy was 74.
Percent at July 15, and June 30, and 72% at March 31.
For our skilled portfolio, which excludes senior care average monthly occupancy through July of <unk> was 69% versus 68% in both June and March.
As Wendy mentioned our.
10 years to expand and is more active than it has been in some time with a diverse set of opportunities, including a mix of existing operating partners and those new to LTC as well as a mix of private pay and sniffs and.
In total our near term pipeline is valued at about $130 million with.
<unk> medium to long term opportunities totaling about another $90 million.
Our bid activity remains healthy and we are excited to see the important part of our current investment strategy gaining steam.
While sales cycles remain elongated and pricing for some properties does not accurately reflect what we believe is there.
The true value, we are more optimistic than we have been in some time about our ability to again begin making long term strategic investments that will position LTC for future growth.
We have nurtured our balance sheet to provide us with adequate liquidity and flexibility and believe we can use this to our advantage.
<unk> as we seek to provide strong regional operators with creative financing solutions.
Open to any transaction that meets our underwriting criteria, but also believe that in the current environment structured finance deals, including mezzanine loans and preferred equity financing still represent the best risk reward profile.
At this time.
Now I'll turn things back to Wendy for her closing remarks.
Thank you Pam and Clint.
We have come a long way since the start of the pandemic. It has not been an easy growth, but I believe we are now coming up on an easier road, let's face. It. This business has never been a newly paid.
Smoothed superhighway with an express lane.
But with great Pride I can say our industry has learned many lessons through many cycles of significant challenge and we continue to provide what I believe is the world's most carrying service to the nation's most vulnerable people eat.
Each day, I become more and more content.
Confidence in our ability to continue to proactively participate in this vital industry. We are positioned to play offense and are seeking out opportunities to strengthen LTC now and for the future.
We will accomplish this by identifying accretive ways to enhance our portfolio diversify our investments.
Serve as a growth capital partner of choice and return to a well covered dividend for our shareholders.
Now, we'll open up the call for your questions.
We will now begin the question and answer session to ask a question you May press star.
1 on you touched on phone.
If youre using a speakerphone please pick up your handset before pressing on the keys to.
To withdraw your question. Please press Star then 2.
And at this time, we will pause momentarily to assemble the roster.
Okay.
And our first question today will come from Jordan Saddler with Keybanc capital.
Then.
Please go ahead.
Okay.
Thank you and good morning.
Wanted to just circle back Wendy I think in your prepared remarks, you discussed.
And occupancy statistic of 25.
Market of weeks of occupancy gains ex 1 week.
In this in the skilled nursing.
Business and can you talk about that in the kind of thanks for what you're seeing of what your operators of sitting in your portfolio.
I think that was referenced for the industry I mean, it's not 100 per sensor.
And Clint just gave.
On the occupancy statistics I don't feel like you guys are necessarily seeing the same day.
We had a conference call with several of our skilled operators and they are.
Seeing a small uptick.
<unk> take up tick in occupancy.
The market that's lagging a little is the Michigan market and we have a lot of properties in Michigan, but Clint had.
Drink Swift the operator in Michigan, the other evening and he is not startled about the situation of all so we are seeing.
For operators.
Are pretty much tracking Nick except for Michigan.
Okay and then.
I was just I followed you guys on the SLC update very thorough.
But I was wondering.
Because.
Debt, it's pretty granular and you can.
Do the water care, but could you summarize sort of the original range versus maybe the pro forma random thinking of the 23 properties last year, we're scheduled to pay $18.44 million.
I think you sold for for $36 million.
Because of.
And.
You've transitioned or about the transition of the rest of what's the pro forma total rent.
From the remaining net.
<unk> botham's weighted properties.
For let's say the second half of 'twenty, 1 or for.
For 'twenty 2 how much do you expect to get that.
And so on it's political.
1 of the challenges on the good news on the buildings that were transitioning to juniper.
As well as to Oxford, which was I articulated we're ramping up rent.
As occupancy increases.
The 2 properties.
Please.
You have the juniper and Pittsburgh.
Pittsburgh those 2 buildings of really substantial contributor under the senior lifestyle portfolio of previously.
So to be able to get back to where we are at in those buildings will play a big part of increasing the rents.
And then once we deploy the capital.
On the asset sales I think as we get into next quarter are starting into the first of 22 will be able to give the.
A better comparison of where we're at.
Yes.
But it's still in flux right now.
Okay, but the.
If you exclude juniper.
I mean is there a number if you exclude juniper in.
Oxford.
Sort of.
The.
$8 million of.
Where previously Jordan, we didn't allocate buildings buy properties, so to be able to take that allocation, it's hard to make that comparison.
I think I'd get that I'm, just kind of curious where you stand I know there was actually a yield so the associated with the $35 million I can follow up with you guys. After but I'm just trying to understand where are you where you guys are ending up on sort of the overall.
The overall guidance for 1 quarter or not.
Not for anything beyond 1 quarter, yes, no I follow.
But I'm trying to understand.
Kind of model.
More than just the 1 quarter and I'm not looking for specific guidance I'm, just trying to see where this specific portfolio of wound up.
And then.
<unk>.
Terms of the.
Acquisition market investment opportunity.
Is there anything sort of.
How would you characterize the claim.
Are you guys getting closer on some of these smaller deals.
On.
What is sort of the flow starting.
Like.
At this point.
There's a lot of activity, we're seeing a lot of.
The deal flow.
Buying assets right now as I mentioned the comments the.
On the evaluation on on what's the.
Let's see as compared to what the performances of the little challenging to buy into investments.
Stay for the long haul, but we're seeing a diverse set of opportunities on structured finance numerous on assisted living 2 independent living skilled nursing.
So we've been happy with the volume we're seeing.
The number of transactions. So I mentioned, the $130 million of my comments on all of that's not guaranteed.
Going to look those are under letter of intent and we're actively involved the due diligence.
Working on those so we're encouraged by what we see.
Okay I'll hop back in the queue. Thanks.
Thank you.
And our next question will come from Connor Seversky with.
Aaron Berg. Please go ahead.
Good morning, everybody. Thanks for having me on the call really just 1 question for me is I'm looking at the deferred abated delinquent rent.
For the the deferrals in particular I think there is the term for repayments between 6 and 36 months correct me, if I have that wrong, but I'm wondering if there's.
Any sense of what the weighting of repayments is within that term as well.
Are you kind of roll of those receipts back into back into the cash metrics.
Hi, Conor its Pam.
I would weighted towards the back end I think the recovery's going to be a little of long dated.
And so obviously they need to get.
Back to stable cash flowing stabilization.
The repay all of that so I would weighted towards the backend of Youre asking for modeling and we would hope any new.
The provider relief funds that come out will clear some of the off yes, if they're if they're stable now right.
That should come to us yet.
Maybe we can get to the government tablets cents per watt.
The us.
Okay that helps and then just a more general question on occupancy I mean within your existing markets or are you seeing any.
Discrepancies between certain markets, where occupancy is coming back faster than others on whether thats.
Whether or not that's related to say the spike of the delta infection rate or anything like that.
Yes.
Our buildings.
The differs by market, we have seen some buildings that have as I mentioned of my comments on some of the senior lifestyle transitions, where theres been a noticeable uptick in occupancy.
Occupancy so.
Yes, it depends by market.
Some markets are still a little bit flatter on we're not seeing any big deceleration in occupancy, which will really that's the encouraging part we're seeing.
Slowly tick up staying flat on some markets a substantial increase so.
At the vaccine declines with the positive.
And the generation has been strong for yeah, especially recently.
Okay. That's all for me thanks very much.
And once again, if you'd like to ask a question. Please press Star then 1 for.
Our next question.
The fact on from Michael Carroll with RBC capital markets. Please go ahead.
Yeah. Thanks could you guys walk us through the range of outcomes with the senior care centers lease I mean will you guys get a decision from the bankruptcy court on the next hearing.
I'm, just trying to figure out how long.
Do we have to wait for this to.
<unk> will cause solution to occur I mean can you give some guidance on that would be great.
Well, considering the fact that we're.
And the legal situation is hard for us to.
Predict or say anything.
We do have the August 11th hearing and the.
We will.
Relative to our press release, if we could get anything material regarding going forward with the.
With this lease on these properties so.
I'm sorry, Michael it's just so complicated and.
We just can't say anything.
Okay, No I understand I mean, just 1 more on that.
I understand if you can talk about it yet is can you talk a little bit about the how of those properties are performing right now I mean has there been disruption since.
So on senior care centers file for bankruptcy is there any.
<unk> for commentary you can provide on that.
Let me have we gotten recent financials from them.
Yes.
The financials would indicate that there.
Cash flow positive, but we havent done any.
Independent due diligence on those financials, I mean, theyre, giving us financials and I don't through.
March although we have true through.
Through may and they would indicate.
Right that those properties are cash flow positive.
So.
Okay.
And then can you talk about how the the 2 leases for I think with the Juniper in Oxford with senior lifestyles.
Lifestyles.
How does that new rank. It said is it going to be based on a formula so as the percent of EBITDAR.
Recently, the should you're going to receive in the second quarter or how does those kind of flow back into the earnings.
It's a great question Mike.
So we structured it by design, we've had long standing relationships, both with juniper as well as Oxford, both dating back to 2012 so.
The performance had declined substantially in those buildings.
Things.
So it's going to be an effort that we co op for the work together.
Words of those so we're fortunate we have a strong relationship with both operating companies.
And obviously, the do with making some.
Some profit if we want to get participation as performance increases so it's something that we worked through cooperatively.
EBITDAR of instead of doing it on a quarterly basis during the first year and then semi annually in the second year.
Okay.
Given our cost of free cash.
Yes, basically thats true.
For the first it would be for us.
Materially meaningfully participate as that as those performance improves and that was the purpose of why we designed.
As such right.
Okay do they have renewal options at the end of the lease.
The 2 year lease.
Right now you don't have renewal options.
But what we are working on is trying to get to a rent to put for juniper to put them into the lease.
The lease long term.
And these buildings are in.
Okay.
For the Oxford buildings. These of 3 buildings that we don't have any other big presence in Nebraska, So that would be properties that we probably looked at selling after the buildings can be stabilized and the Oxford would participate in that with us would be the optionality we have.
For the Nebraska buildings.
Okay, and then can you break out how many operators LTC is deferred or of beta <unk> and I know there's been a couple of months here, but maybe you could just focus on July and August and September it looks like the only rent that was deferred as all to the on the identified operator.
Is that correct and then.
They're marni operators are you of beating rent for right now.
It's the same small group that we've been investing for the past couple of quarters. So there is there is not anything new in there.
1 in debt.
Deferred group that you noted.
Then Hammond.
Primarily 1 in the.
Hey, good growth.
There is 2 in the beta group. The 1 is the majority the both had the transition amount of fully out of each.
These were transitioning portfolios.
Yes.
Got caught in the pandemic not stabilized.
Okay, great. Thank you.
Youre welcome.
And this will conclude our question and answer session I would like to turn the conference back over to Wendy Wendy Simpson for any closing remarks.
Thank you. Thank you all for taking time to listen to our conference call and we look forward.
During the reporting to you again at the end of the third quarter have a great weekend bye bye.
The conference has now concluded. Thank you for attending today's presentation. You may now disconnect your lines at this time.
For 2.
[music].