Q2 2021 Uni-Select Inc Earnings Call
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Ladies and gentlemen, please standby.
Good morning, ladies and gentlemen, and welcome to Uni Select Inc..2021 second quarter results Conference call. At this time all lines are in a listen only mode. Following the presentation. We will conduct a question and answer session. If at any time. During this call you require me to the assistance. Please press star zero for operator.
Note that today's call is being recorded.
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And I would like to turn the conference over to Luis you know chief legal and administrative officer and corporate Secretary. Please go ahead.
Thank you Sylvie and good morning, everyone and thank you for joining us.
Towards the Uni select second quarter conference call presenting this morning are Brian Mcmanus executive chair and CEO of Uni select and entities back Ano Chief Financial Officer.
Following their comments, we will open the call for questions.
Please note that all documents referred to in today's conference call, including the us set when.
Webcast presentation can be found on our website that you referred you.
<unk> dot com and the investors section.
As noted on slide 2 I would like to remind you about the caution regarding forward looking statements.
Which is applied to our presentation net income.
All amounts are expressed in us dollars, except as otherwise specified.
With that let me turn the call over to Brian.
Thank you Louis good morning, everyone and thank you for joining us for our second quarter results conference call I.
I would like to give a warm welcome to the financial community many of whom I know from my previous days and Stella Jones and <unk>.
Excited to be back and front of you and look forward to renewing and building relationships with you again as we provide quarterly updates on the progress of Uni select.
I've been on the driver's seat at Uni select for just over 2 months now, but I am pleased by the initial steps we have taken in the short amount of time.
Had the pleasure of speaking with many senior management team members across all 3 business units and have toured our U S operations, a few weeks ago, visiting and our corporate office as well as branches and D C.
This has started to give me a better feel for the operations and what is required to drive the path forward.
My first order of business is to rebuild the leadership team.
We need bench strength to be successful having.
Having the right person and the rate position makes us all the difference.
You may have noticed that we have made substantial changes to our executive leadership team and the second quarter.
Besides and the Ni who are new to the table. We recently promoted Emily go day to the position of President and Chief operating officer of the Canadian Automotive group.
And I'm delighted to see the talent and our team and pleased to have and internal member of our organization, who already knows the importance we place on supporting our partners and developing our business to serve our clients take on this role.
And we appointed Sally Dowling as interim President and Chief operating officer of Tpa. Following the resignation of Neil Crocs, Inc. While the search is underway for a permanent leader of this business unit Sally is uniquely positioned to lead the business and the interim having recently served as CFO of Tpa.
Finally, Natalie's you route stepped down from her role as Chief people Officer, and Vice President of Human resources for the Canadian Automotive group in July and we've decided not to replace the dual role.
These changes and those to come and will position the corporation to focus on operational excellence and to capture future growth opportunities.
Yes.
Over the near term and the next 12 to 18 months, we will focus on aligning of 3 businesses with our vision for the future.
Each business unit, we will focus on the execution of select key priority to successively successfully set the foundation for future growth.
We believe that fewer but more impactful initiatives will drive a greater bang for our Buck.
The objective is to drive profitability, not just by cost savings, but more importantly by how to better serve our customers and members sufficiently.
In parallel we will identify opportunities whenever and wherever possible we.
We are positioning the business for the long term and see many opportunities ahead and all 3 businesses.
While continuing to improve operations remains our top priority, we see potential for consolidation further down the road, which we believe will be a component of driving our businesses to the next level.
On that note, let me turn to page 5 for the key highlights of the second quarter.
We are very pleased with our second quarter results, which reflect strong market recovery from the worst of the pandemic and sequential improvement in the business.
Consolidated sales for the second quarter were up 38% to $416 million from.
And from $303 million last year, primarily attributable to organic growth of 29%, reflecting a strong rebound and all our business segments.
From the trough of pent up the pandemic set and Q2 last year.
This is coupled with a favorable impact from currency conversion of 9%.
While organic sales continue to improve on a sequential basis, they remain below 2019 levels.
In turn adjusted EBITDA more than doubled to $34 million.
Or a margin of 8.2% compared to $15 million or a margin of 4.9% last year.
This performance was largely driven by improved sales and additional rebates price increases and benefits from cost savings.
These factors were partially offset by higher expenses related to a fully operational business and higher net stock based compensation due primarily by the large increase and our stock price during the quarter.
This and itself represented approximately $3 million.
As a.
Sort of higher adjusted EBITDA and lower financial expenses, our adjusted EPS increased from a loss of 23 per share to a profit of 21 per share.
Given our improved profitability, we generated solid cash flow from operations and the second quarter, which we used to substantially reduce our total net debt.
Finally in June we amended and restated our credit agreement, which preserves our liquidity and flexibility while meaningfully reducing our cost of borrowing.
We estimate that had this amended facility been in place at the beginning of the quarter. Our net finance cost would have been approximately $2 million lower.
I will now turn the call over to Anthony to complete the financial review anthem.
Anthony Thank you Brian.
And those on the call to page 7 on the presentation.
Before I discuss the results from our 3 segments I would like to touch upon certain onetime items that negatively impacted EBITDA by approximately $34 million and the second quarter and.
The first relates to inventory obsolescence.
During the quarter, we changed the estimates used to determine our inventory obsolescence provision and finished master.
This resulted in a onetime obsolescence expense of $20.6 million.
The change in estimates mainly results from our in depth review of the operations, which aimed to better align our current product portfolio with evolving customer needs.
In essence, we have taken a deep dive into our inventory and have identified those products, which we do not believe we'll sell through over the course of their useful lives.
The second material onetime items related to severance expense of approximately $10 million.
Primarily due to the departure of certain executives and the first half of 2021.
Both of these expenses are 1 time items and have been excluded from the calculation of adjusted EBITDA.
Turning to page 8 for a review of finished master.
Both sales and organic growth increased by 20, 28% to $171 million due to recovery and sales from the trough set and the second quarter of last year.
Organic growth continued its sequential improvement over the past year and turn positive for the first time and almost 2 years.
That being said sales remain below 2019 levels.
Adjusted EBITDA also continued its sequential improvement.
<unk> $13.2 million on a margin of 7.7% compared to $4.5 million or a margin of 3.3% for the same period last year.
This significant improvement was primarily driven by additional sales volume the.
The benefit from cost savings and price increases.
Yes.
While we are pleased by the improved financial results from finished master both Brian and I are encouraged by the prospects for future operational improvement and the business.
Turning to page 9 for the Canadian automotive group.
Sales reached $145 million up 27% from $114 million last year.
This group this growth was driven by organic growth as well as favorable currency conversion effects.
Organic growth of 12, 3% reflects the recovery recovery from trough levels of sales set and the second quarter of last year.
Adjusted EBITDA reached $17.7 million or a margin of 12, 2% up from $12.9 million on a margin of 11, 3% for the same period last year.
This improvement was mainly driven by additional sales volume and additional vendor rebase.
For the fourth consecutive quarter, CAGR, Fortinet and improvement and adjusted EBITDA and margin versus the comparable quarter of the previous year and has maintained the margin of over 10% during this period.
Please keep in mind that CAG benefited from over $4 million of government subsidies and the third quarter of last year, which will not be repeated inc.
And the next quarter or our Q3.2021 results.
Turning to page 11 for the parts Alliance.
Sales reached 100 million and increase of over 80% from the same period last year, mainly driven by organic growth growth and the positive effect of currency conversion.
Organic growth of 62, 6% reflects the recovery from the depressed level set and the second quarter last year.
While organic growth continues to improve sales remain below 2019 levels.
We note that.
We expect the seasonality of the Tpa business to change as government mandates have shifted the timing and mandatory motor vehicle inspections to the second half of the year.
Recall that these inspections have historically been a catalyst for automotive aftermarket sales.
Adjusted EBITDA for the parts Alliance reached $8.3 million or a margin of $8.3% up from zero point $3 million or a margin and 0.6% last year.
This improvement is driven by additional sales volume.
The benefit of cost savings and price increases.
For the fourth consecutive quarter of Tpa has improved its adjusted EBITDA and margin over the corresponding period of last year.
Turning to page 12 for comments relating to our cash flow.
We generated $43 million of cash flow from operations and the second quarter compared to $35 million last year.
This improvement was mainly due to our improved profitability.
And and ongoing focus on working capital and disciplined capital spending.
After accounting for net investments and merchant advances as well as Capex and intangibles, we generated free cash flow of $41 million and the second quarter versus $33 million for the same period last year.
Please note that we have reviewed our definition of free cash flow and the quarter and comparative figures were adjusted Accordingly, you.
And you can find the updated definition and the MD&A, but in short we have included changes in working capital and investments and intangibles into our definition of free cash flow.
And this change and definition makes comparisons to the 2020 quarters, a little more challenging as.
As <unk> 2020 was largely characterized by the partial right sizing of working capital.
That being said, we feel that the modified definition of free cash flow more closely aligns with how we manage the business and the definition expected by the investment community.
Turning to our financial position on page 13.
Given our active cash management and improved profitability, our total net debt decrease and the second quarter.
And at the end of the quarter, our total net debt stood at $348 million, including $98 million of Ifr 16 lease obligation.
This represents a decrease of $35 million versus $383 million at the end of Q1.
Driven by a higher adjusted EBITDA and lower total debt our leverage ratio decreased to 2.9% up 2.9 times in Q2.2021 from 3.
And 3.8 times at the end of the first quarter of this year.
Turning to page 14.
On June 25th we amended and restated our credit facility.
And we reduced debt facility from 565 million to 500 million.
And the facility now includes a $350 million secured long term revolving credit facility as well as 2 secured term facilities for a total principal amount of $150 million.
The revolving credit facility can be repaid at any time without penalty and matures on June 30 of 2023.
The term facilities also mature on June 32023, perhaps quarterly repayment obligations of $5 million.
And the remaining balances are payable on June 32023.
These changes to our credit facility allow us to preserve liquidity, while materially reducing our cost of borrowing.
To put this in perspective as Brian previously stated we estimate that our net finance costs for the second quarter would have been approximately $2 million lower if the credit facility had been entered into at the beginning of the quarter.
We have also been able to improve flexibility.
As provisions governing permitted acquisitions permitted indebtedness dispositions capital expenditures and EBITDA add backs have been favorably amended.
In addition, we transition back to a more convention conventional covenant structure, including net debt to EBITDA and EBITDA over interest compared to previous metrics based on liquidity and minimum EBITDA.
Turning to page 15.
We've provided our new financial covenants and a table format for your convenience.
At the end of the second quarter, we had approximately $247 million of liquidity.
Subject to financial covenants and.
And a total net debt to EBITDA ratio of less than 2.5 times with.
And with an EBITDA to interest expense ratio in excess of 5 times.
And we were therefore, while and compliance with all of our covenants.
I will now turn the call over to Brian for concluding remarks, Brian.
Thank you Anthony.
I would ask that you please turn to slide 17.
In summary, we are seeing continuing positive momentum and continue to see sequential improvement and our.
We are also very encouraged by the preliminary opportunities we have observed.
We will not be introducing overall guidance at this time, however, based on what we're seeing and the second half of the year. We can confidently say that we expect to finish 2021 with increased adjusted EBITDA and adjusted EPS as compared to 2020.
Having said this there are 2 potential headwinds that could impact our results. The first is a resurgence of COVID-19, and the fall and the second is a worsening of global supply chain shortages.
While our team has done a great job managing through these so far it could become increasingly challenging going forward.
Recall that cash and tpa are more likely to be impacted by the global supply chain shortages.
And then finish master.
Okay.
This concludes our presentation, we're now ready to answer your questions.
Okay.
Thank you ladies and gentlemen, if you do have any questions. At this time. Please press star followed by 1 on your Touchtone phone and you will hear a sweet home prompt acknowledging of your request and if you would like to withdraw your question simply press star followed by 2.
And if you are using a speaker phone and we do ask that you. Please lift the handset before pressing any keys. Please go ahead and press Star 1 now if you have a question.
And your first question will be from <unk> at Deutsche Bank. Please go ahead.
Yes, good morning, gentlemen, and congratulations for the very strong start.
Brian you already gave some color with your first impression about unit share like I was just wondering what are the key elements, you're looking at and where do you see the greatest potential for consolidation.
Among the 3 business units.
Thanks, Pat and why and a good morning.
In terms of opportunities and.
Really it applies to all 3 business units from a standpoint of.
We see a lot of opportunities and and.
And going to be driving all 3 over the next sort of 12 to 18 months focusing on operational excellence.
In regards to your questions of consolidation.
At this point.
And we actually see all 3 businesses with potential opportunity to consolidate what we view as a fragmented market and in all 3 business units, but again, our near term focus is really going to be on delivering value to our customers and ensuring operational excellence.
Okay, that's great and Tony from a free cash flow standpoint did very strong and you gave the color on what drove the free cash flow and the quarter was <unk>.
Just wondering about this and ability in the coming quarter, and where would you expect to and the year in terms of leverage for the entire year.
Yeah. Thanks for the question Ben.
Look we're not going to provide any any specific guidance on goalposts around around leverage and leverage metrics.
What I would say in regards to the quarter is and if you take a quick peek at the cash flow statement. There is a large.
A large cash flow benefit from accounts payable.
That that is unlikely to repeat itself and such magnitude.
The guidance I will give you here been wise, we're likely to.
And the year at roughly around the same debt levels. We are we are today and.
Plus or minus on that of course, but.
Likely to stay flattish from a from a net debt perspective.
Okay, that's great and last 1 for me I was wondering whether the stronger cash position gives us enough flexibility to start and more aggressive growth strategy or.
Would you still like to do.
Take your time and see better flexibility before becoming more aggressive in terms of growth strategy.
Yeah look I think both both Brian and I have.
Have been and the market.
We're encouraged by everything that we've seen.
And particularly as it pertains to.
Focusing on driving operational excellence and our businesses. So that's as Brian mentioned and that's really the that's really the near term priority.
But certainly you've seen you've seen the deleveraging and that does create a certain amount of flexibility, but the focus remains very much on on operational excellence here going forward.
That's great. Thank you very much for the time I'll get back into queue.
Thanks Pat.
Thank you next question will be from Goldman Sachs Day at Laurentian Bank. Please go ahead.
Hi, good morning, and congrats on the good quarter.
Thank you. Thank you.
And my first question is more on the finish master site quite a good improvement on the margin side I'm just wondering how do you think of that business.
Is there still room for more improvement are or.
How do you think of that business and a big picture 1.
Hi.
I'd say, we again I'll apply it to all businesses, but your question specifically on finished master we do.
See continued opportunities to improve upon the.
And the business.
And both in terms of efficiencies, but also in terms of how we approach the market and deal with their clients. So we do see opportunities there for sure.
Okay. That's fair and secondly, if you could speak about cost pressures are labor shortages and how how is that environment is that manageable or you're thinking that you know going forward there will be some cost pressures and some labor shortages.
It is currently manageable.
Certainly.
Most industries, we're feeling.
Labor cost pressures I would say it's regional.
Even within the business units themselves, but it's something our team has a close eye on and.
We will adjust as necessary to ensure that we can continue to drive our business.
Okay, That's fair and maybe just last 1 for the U K business I mentioned that you had mentioned that you have been out and meeting a lot of business and as the U K business you have with it at that 1 as well is that somehow any different.
Or is that net offers more growth opportunity in terms of consolidation or is it is it the same across all 3 segments.
The same across all 3 unfortunately, the current restrictions due to Covid have have limited our ability to get over to the U K, but it is on our list to get there as soon as the.
Canadians are welcome to come.
Fair enough. Thanks for the color and once again congrats on the quarter. Thank.
Thank you.
Thank you next question will be from Zachary Eversheds at National Bank. Please go ahead.
Good morning, everyone congrats on the quarter.
Thank you.
And so it's great to hear that there are still improvements to be made us finish master and in fact, all 3 segments could you give us examples of the initiatives you're pursuing under the continuous improvement plan.
Hey back look I think I think there's I think there's a number of them.
Going forward, we wont be referencing any specific plan or providing color on any specific initiatives.
Got you. Thanks, and then to clarify your stance on no formal guidance should we disregard the figures put out there by the prior management team.
Look I think I do.
Don't want to I don't want to go down the list and say, yes, and no because that's just a form of providing guidance.
And I'll stay on <unk> on that topic.
I understood. Thanks, and then to beat a dead horse a bit on the acquisition opportunities could you rank your capital allocation priorities for us and where you get more comfortable comfortable returning capital to shareholders.
Okay, I think there's there's a few parts to that question right or.
Our capital allocation priority first and foremost is is the reduction of our debt.
And which we've made material progress on here going forward.
As it as it pertains to returning capital to shareholders. Ultimately ultimately that's a decision of our of our board.
So those that's again I hope that answers the question.
And Doug Thanks, I'll turn it over.
Thank you.
Thank you next question will be from Daryl Young of TD Securities. Please go ahead.
Good morning, gentlemen.
Hi, Dara.
First question is on on the U K and just the competitive environment. There I think I think 2 of your large competitors there talked about taking market share and the region and wrapping up and I was just.
And you could maybe provide a little bit color on what youre seeing there and and.
Whether your grosses is market related or taking share as well.
Well I would start by saying our team is doing an excellent job of holding our position and the market.
Growth is certainly just.
Bouncing off of what was a very low level last year.
We are also looking at a couple of greenfield opportunities ourselves for some expansion and some of the areas where we're missing.
Branches to serve our customers, but overall, we're very satisfied with the performance of Tpa.
Okay, Great and then.
Maybe a bit of a nitty gritty question on finish master, but.
And we continue to see the body shop consolidation happen arguably at an accelerating pace.
And I'm, just curious about the history of providing paint incentives so to some other smaller players.
Pre pandemic there seem to be.
And then some more aggressive.
Paint incentives being applied would.
Would you expect those to ebb and the future is this consolidation story continues and.
And the large msos continue to negotiate directly with the pay to Oems.
Hey, I'll take that on its Anthony so from our from our perspective, and we're not going to comment too much on the activities of our of our competitors but.
We continue to.
You see that pretty clearly and our cash flow statement, we continue to to invest and customer incentives where appropriate we.
And we won't provide any.
Any guidance on what that is going to look like going forward.
Okay and.
And maybe just 1 last 1.
Around the inventory.
Core purchasing rebates is there anything.
Large and and the last quarter, just as you work through a bit of a ramp up and restocking or should we expect any any kind of upside from those.
And as the recovery progresses.
Look I think I think we're being we're being very thoughtful and very methodical and the way that we're looking at our inventory levels.
And we want to be cautious and we have a very high focus here on on working capital.
So I think that that's sort of philosophically the direction to ask you on.
To answer your question a bit more a bit more directly.
The business naturally has ebbs and flows of of rebates coming in and out.
I wouldn't call out anything anything specific on material during the quarter.
Okay, great. Thanks, guys Thats all from me guys good quarter.
Thank you thank.
Thank you next question will be from Jonathan Livers and BMO. Please go ahead.
Okay.
Thanks.
Brian I realize it's early days.
Would you be and are positioned to comment on the white space that you see for the 3 businesses and for finish master in particular.
No.
And I think your first part of your question kind of answered it it's still early days.
Getting to understand sort of our positioning in the different regional markets. We.
We recognize there is white space and and definitely opportunity, but again the near term focus is just going to be on getting that operational excellence and and ensuring we're providing great value to our customers and from there that we'll be able to.
And look for great opportunities.
Beyond let's say the next 12 months to hit their 12 to 18 months.
Okay. Thanks.
The press release mentioned supply chain challenges.
Net sales teams seem to have been good have these had a material impact on fill rates or do you expect them to going forward.
Look I think I think we've done a reasonable job of managing it.
It's it will be no news to anyone to hear that.
There are.
Cost pressures.
Across across all industries.
And there are rising input costs, particularly for products.
Manufactured and the Orient.
And where the shipping rates have.
And how.
Have literally exploded.
That being said I think our teams have been very proactive here and managing this and we're quite pleased by.
How it's being how it's being managed and our various divisions.
I've always thought that.
This business has a good ability to pass on cost inflation through pricing.
Does that seem to be something you would agree with us.
Look I think I think we've called out 1 other drivers of.
The EBITDA margin improvement to be to be price increases.
I would certainly agree with that with that statement.
222, a limit right.
Naturally we have to always monitor ourselves and the and the competitive environment and see where we stand versus.
And versus our peers and that's something that we and we keep a watchful eye on us.
As we determine our own pricing strategies.
Thanks and.
1 thing absent from the slides it seems to be commentary on the July.
Sales trends is there any color that you can give us on on the organic sales into Q3 by business.
That said specifically not there on purpose, that's something we will no longer be providing.
Going forward.
Okay. Thank you for your comments.
Great. Thank you.
Thank you next question will be from Carolina Jolly with Gabelli. Please go ahead.
Okay.
Hi, Thank you for taking my question and great job on the quarter.
First of all I was just wondering not specific to you Mr. Mark, but just overall the.
<unk> finished master environment.
Refinish business collision.
Can you just talk about what Youre seeing there is it all just about congestion.
And in terms of cadence is there are there any signs where we're seeing.
Mark Mark congestion or or and.
And and the seed industry trend.
And back towards 2018 level.
We're not there yet we are seeing.
The trend starting to.
And starting to pick up but you are right and your question in regards to on traffic congestion and.
And obviously the results on the refinish business.
But if we look back to 2019.
The data, we're seeing is still down about 10% to 15%. So we're not we're not back to where we were in 2019, but hopefully us.
And if COVID-19 doesn't resurface people will be back out and we'll start to see the business pick up again.
Thanks, and on this and just a quick question on in terms of the inventory obsolescence.
Is there any I guess is there any industry trend or that would.
It would be continue to be an issue, where you know and.
And yes.
There is so much innovation.
Debt.
This happens more often and or is this kind of it and obvious 1 time.
And I think this falls into the obvious 1 time issue.
Okay, great. Thank you for your answers.
Thanks.
Thank you next question will be from <unk> at Deutsche Bank. Please go ahead.
Yes, so just in terms of priority and Tony you mentioned about the reduction of debt. These priority number 1 what would be kind of your targeted level, where you would feel more optimal or comfortable.
Range.
I'll answer that as Brian would lower.
Uh huh.
So not in other.
And <unk>.
On.
We're we're going to for the time being we're going to direct all of the free cash flow the majority of the free cash flow towards towards debt repayment.
And then as we as we come down here and as capital allocation opportunities present themselves and then we'll certainly cost us contemplate those on their own merit based on our overall structure. So I think that given.
Giving giving a direct answer to that us.
It's tough.
Okay.
Maybe a bit of a tough 1 here, but what would be kind of your debt consolidated EBITDA margin that would support your thoughts around operational excellence, let's say and about 18 months and when you say.
The goal is to better serve customers are there some specific matrix.
And that we should look at debt you would like to improve down the road.
Well I think we certainly would like to see our sales and our market reach and proof.
And within every market in terms of.
What we're going to bring from a standpoint of customer value but.
A little unclear on your question of NY and regards to.
And B out 12 to 18 months from now and just if you could repeat it and I'm sorry.
And probably it's still early days, but are there any targeted consolidated EBITDA margin that could support your thoughts about where you see the potential in terms of operational excellence and the let's say 18 months forward.
Yes.
And why.
We're not going to provide guidance here on on future EBITDA margins.
Or like the debt being lower we want to say higher.
No.
Okay, and maybe very quickly on finish master.
And as longer ring.
Whether you could quantify the impact of the price increase or was it part of normal course of business, so not much material and the quarter Anthony.
It's normal course of business spinoff.
Okay. Thank you again.
Good morning.
Thank you.
As a reminder, ladies and gentlemen, if you would like to ask a question. Please press star followed by 1 on you touched on the topic.
And your next question will be from Zachary I Bershad and National Bank.
Hey, 1 quick follow up what's your view on the recovery and collision frequency given the disruption of rush hour traffic, perhaps due to more flexible hybrid work arrangements being larger factor for longer.
I wouldn't really have a good answer on that.
Zack I think we really want it and we're hopeful that we're going to see it move back to 2019, but I think at this point, it's hard to really say whether.
The work from home.
And people not going and at the office as much is going to have what that overall effect will be on the.
On the congestion and rush hour traffic as you point out and and in turn the collision.
Part of the equation so.
I wouldn't be able to give you and I think all.
All I can tell you is we hope it's going to go back to similar levels.
My answer.
Gotcha, and and the trend that youre seeing and paint orders, thus far are encouraging.
And yes. It is I mean, we can see the growth you can see it and the financials. The sales are are coming up but again, our comparative year of 2.
<unk> 2000 Twenty's.
With our low point, but we're hopeful that we'll start to see track closer to 2019.
I appreciate the color.
Great. Thank you. Thank you.
Thank you and at this time gentlemen, we have no further questions. Please proceed.
Thank you operator, and thank you everyone for listening we look forward to updating you on our progress during our next quarterly call and.
Have a great day.
Thank you, Sir ladies and gentlemen, this does indeed conclude your conference call for today. Once again, thank you for attending and at this time, we do ask that you. Please disconnect your lines.
[music].
Okay.
Yes.