Q2 2021 Star Bulk Carriers Corp Earnings Call
Thank you for standing by ladies and gentlemen, and welcome to the Star bulk carriers conference call on the second quarter 2021 final choice.
We have with US Mr. Petros Pappas, Chief Executive Officer, Mr. Hamish Norton President Mr. Nikos, the rest Goss Chief operating officer, Mr. Simple spirit on Mr. Crystal spec lettuce co chief financial officers of the company at this time all participants are in a listen only mode there'll be a presentation followed.
By the question and answer session of which tells me if you wish to ask a question. Please press star 1 on your telephone keypad and wait for your name to be announced I must advice you that this conference is being recorded today, we now pass the flow to 1 of just because Mr. Kristol speak. Louis. Please go ahead Sir.
Thank you for a dark.
Greece, those big Larry Co CFO Star bulk and I would like to welcome you to our conference call regarding our financial results for the second quarter of 2021.
Before we begin I kindly ask you to take a moment to read the safe Harbor statement on slide number 2 of our presentation.
Okay.
In today's presentation, we will go through our second quarter results, our cash evolution during the quarter and operational updates and the latest industry fundamentals before opening up for questions.
They just now turn to slide number 3 of the presentation for a summary of our second quarter 2021 financial highlights.
In the 3 months ending June 30th 2021 TCE revenues amounted to $264.9 million compared to $97.1 million for the same period in 2020.
Adjusted EBITDA for the second quarter 2021 was on.
$182.5 million versus $35.2 million in the second quarter 2020.
Net income for the second quarter amounted to $124.2 million for $1.22 sales earnings per share versus 44 for 1 million net loss or <unk> 46 cents loss per share in the second quarter of 2020.
Our TCE rate during this quarter was at $22927 per vessel per day.
Total cash day stand.
$283 million, we felt those day at approximately 1.62 billion.
In addition, we have the ability to use of $30 million revolving facility, which is currently undrawn.
During the second quarter of 2021, we took delivery of 1 with the Max and the 2 remaining comes from re sales, reaching a total of 128 vessels on the water.
As of June 32021, we owned 128 pesos and our total cash balance pro forma for the financing proceeds of the 2 recent gobs of IMAX East was that $282.8 million, resulting in the declared dividend per share of 70 cents payable on or about sept.
Timber eighth.
On slide 4 we show the significant annual interest cost savings of the company due to our refinancing efforts.
Total existing facilities refinanced oracle needed to be refinanced amounted to $333.7 million with new secured senior facilities of.
$391.7 million.
Using the excess proceeds are baby born of 50 million was the D.
The average margin for the existing facilities for refinance is at 2.9%.
The average margin for the new secured facilities is that 2.1 per se.
Finally, the interest rate cost savings for star bulk is that $5.5 million out.
Out of which for 1 or the interest cost savings attributed to the redemption of our baby bonds and <unk>.
1 point for millions are due to the refinancing of our senior secured facilities.
Slide 5 graphically illustrates the changes from the company's cash balance during the second quarter.
We started the quarter with $206.6 million in cash day.
The positive gastro from operating activities of the 145 million due to the strong freight markets.
After including debt proceeds and repayments vessel acquisitions, capex payments for scrubber and ballast water treatment system installments as well on the dividend payment declared in the first quarter. We arrived at the cash balance of $242.8 million at the end of the second quarter.
Please turn to slide 6 where we summarize the evolution of net debt since the beginning of the year, we have been able to reduce our net debt by more than 228 million due to strong cash flow from operations.
On slide 7 we demonstrate the inherent operating leverage of the company do of rising freight markets and the potential increase in EBITDA with any freight or fuel spread increases.
For example.
We have 46500 fleet available days per year.
And the additional daily fleet wide increase in D. C. By 2000 per day will increase our EBITDA by $93 million.
Similarly, assuming a total annual bunker consumption of 800000 tons.
The increase in the high 5 fuel spreads by $25 for total will generate an additional EBITDA of 20 million.
I will now pass the floor to our CFO Nicos Reis gross for an update on our operational performance.
Thank you for yourself please.
Please turn to slide day, where we provide on operational update.
Opex, excluding nonrecurring expenses of $4280 for the first half of 'twenty 'twenty 1.
Net cash G&A expenses for our $1807 per vessel per day for <unk>.
First half of credit.
Despite continued adverse COVID-19 related restrictions on direct impact from FX.
The combination of our in house management on the scale of the growth enable us to maintain very competitive costs with star bulk continuing through rate of number 1 on 1.
Our listed peers in terms of right.
Since January of 2020, Starbuck maintains a 99, 6% scrubber system availability across 120 vessels. The 60000 operating based on more of a $1.2 million on thoughts on pages of bolt on.
Sure.
The company has made significant progress on our lives and carbon emissions across the fleet.
Zero by more of 2023 of the optimization growth.
We believe the vessel emission profile.
Main competitive within the upcoming cargo index the index framework, which is expected to be adopted by the EMA in 2023.
Aiming to establish all required the provisional measure is ahead of the regulation of effective day rate.
The making bouygues planning analysis speak of outperformance of optimization practices, which will be adopted across our fleet as of January 20th of credit Suisse.
On the Capex from we're examining the long term impact of various energy saving devices on applications and maintaining a competitive carbon intensity rating across our fleet.
I think 'twenty free.
We are actively engaged with values RMB workshops on consortia in collaboration with other stakeholders include the engine makers classification societies for TV.
And the carbon credit advisors in pursuit of secondary and commercially viable solutions and reducing meaningfully our vessels carbon emissions footprint.
Turning to slide 9.
We provide some guidance around the use of dry dock and ballast water treatment system expense for the next 12 months and the relevant the total of 5 days.
The numbers are based on kind of estimates around drive the collateral value the vessel employment and yard capacity.
The speakers incorporate the current understanding of present and future shipyard congestion.
Since the beginning of the year credit.
So thank you for the vessels habits of the Drydock of 13 countries retrofitted with products for the frequency.
Well the majority of our larger vessels scheduled for the year for the dry.
The first quarter.
I expect the driver of expense for the next 12 months is estimated at $27 million for the dry docking of 30 vessels with a lot of 25 day millions of awards our balance system Capex.
We expect the half 72% of our total of leap ballast water treated by end of 2021 and 97% by the end of 2022.
In total.
Next to have approximately 825 of our days for the forward 12 months period.
I will now pass the floor to our CEO Petros Pappas for a market update on his closing remarks.
Thank you Nicole.
Please turn to slide 10 for a brief update of supply.
During the first half of 2021 the total looks $21.5 million deadweight was delivered and for 4 million. The wage was centered demolition for a net fleet growth of 17 point of 1 million deadweight or 3.1% year on year.
And 1.7% since the beginning of the year.
The other book decreased with the record low of $5.7 per cent of the fleet with 11.1 million deadweight the reported by Clarksons as firm orders between January and June.
Soon as then it rebounded to.
The $23.6 million deadweight, including some options that have been declared and thus the order book increased to slightly above 6%.
Upcoming environmental regulations and the uncertainty on future propulsion has helped keep new orders on the relative control.
With the shipyard capacity is quickly filling up with container ships and other orders. Furthermore, the surge of global of steel and iron ore prices has increased new building prices and for scrap prices. The new record is possibly a day demolition and also discouraging new dry bulk orders.
Average stemming speeds of the dry bulk fleet currently stands at 11, 7 nuts and despite the higher freight rate environment have only increased by 1% year on year, partly due to higher bunker costs.
As the global economy, and the oil products' consumption. The recovers, we expect bunker prices the experienced upward pressures that will support higher freight rates the scrubber savings.
For the congestion is increasing for the highest level over the last decade.
The interest related to COVID-19, and increased political tensions in China, The words, Australia and India.
The strong and the efficiencies for trade.
Haven't helped tighten the supply demand balance.
Summarizing supply net fleet growth is expected at 3% by the end of 2021 and so the remained below 2% per annum during 2022 and 2023.
Let's now turn the slide 11 for a brief update of demand.
According to Clarksons total dry bulk trade during 2021 is projected to expense by 4% in Thompson for point of 3% the ton miles.
Volumes of our expansion has strong recovery supported by a synchronized global economic stimulus that focuses on the construction sector.
Commodity prices reached historical high levels that sort.
The incentivize of strong expansion in production and trade during the next years. Furthermore, you Atlantic export projects and increases in the Pacific rim demand on <unk>.
<unk> been flipped on miles and the vessel requirements over the next years.
During the first half of 2021 dry bulk trade grew by more than 7.5% year on year and by more than 5 per cent compared to 2 of 2019 levels is all cargo volumes increase the rapidly, especially grades and minor bulks.
I don't know of ton miles are expected to expand the by 3.6% during 2021.
The new steel production expanded by 11% during the first half of the year direct with high levels, whilst the while it's still make us from the rest of the world increased production by 15, 6%.
Still unable to meet the regional demand.
As a result of steel prices in the Atlantic are trading at a significant premium to the Pacific and the.
White price arbitrage is it satisfies specifics the electrical with smaller vessels benefiting the most during the last for months.
But as the light on or exports of slowly recovering from the Wednesday, 19 disaster and during the first half of the year of increased by 15, 3%.
The day that the target the 400 to 450 million tons of production capacity by the end of 'twenty 'twenty 2.
Called on miles I expect that the expense by 5.3% during 2021 as global energy consumption experiences of strong recovery.
In the first half of 'twenty, 'twenty, 1, China, and India thermal electricity output has been expanding at the higher base than domestic production and has created sort of is that the full stocks lowering the prices to recognize the.
Chinese ban on Australia of goal as far as the power at the business steelmakers to diversify as Seacole cargoes from longer distance sources sets of South Africa, Colombia, The U S and Canada, but also increase the Indonesian the imports that expands the long delays the took werent themes.
In India for consumption experience the slowdown during the second quarter due to the resurgence of Covid lockdown imposed by the government.
However, during the last month the electricity production has rebounded in Indian buyers in return for the.
The market with interest the important needs to replenish their stocks.
Great on my other than expected to expense by 4.3% during 'twenty 1 after another 11.3 per cent decrease during the 20th plant.
China's demand for grain is projected to remain strong in the medium term as the current 5 year plan focused on food security.
At the same time, the hog herd has fully recovered and <unk> 20 per cent of both the levels before the 2018 African swine fever outbreak.
U S soybean and corn exports both expense record high seasons, while sales for the next marketing of year standard record levels for this time of the year, the Brazil soybean export season started with delays due to heavy rains at harvest areas, but higher than last year and helped create the soldiers.
Of vessels in the Atlantic.
Minor bulk ton miles I expect that the expense by 4.3% during 'twenty 'twenty 1.
Minor bulk trade that has the strongest positive correlation of the global GDP growth.
All of that gave the vessels will continue to benefit significantly from the synchronized concept of recovery and restocking cycle. During the rest of the 'twenty 1 'twenty 'twenty 2.
Having said that Cape sizes are in the <unk>.
Medium term expect it to benefit from GSK day, and it's Duncan on miles from Atlantic export cargoes, such as West Africa book site.
Finally, our outlook for the market remains positive.
For the low order book combined with the lack of yard space uncertainty on future vessel the propulsion and go over the late the deficiencies.
The efficiencies greater very favorable supply side picture for our industry.
The government spending due to the synchronized pandemic stimulus programs has led the strong commodity demand globally with the robust.
Volumes of iron ore coal grades and minor bulks being transported the trend, which we expect will continue supporting our optimistic view on the future prospects of the dry bulk market.
Without taking any more of your time I will now pass the floor over to the operator will answer any questions you may have.
Thank you from that.
Ladies and gentlemen, if you wish to ask the question. Please press star 1 on your telephone keypad and wait for your name to be announced.
Our first question for today.
The clock.
Please go ahead.
Hi, there. Thank you hi, guys good afternoon.
Hi, I just wanted to check in on the the the.
The cash thresholds for the dividend, obviously, a nice day than this quarter.
But and I know I asked this on the last call, but just wanted to see if you had any more updated thoughts I know, it's starting in the fourth quarter.
The minimum cash you want to keep goes up to $2.1 million per vessel. So across all of your of 128 ships that gets you to $256 million and then everything above that gets paid out.
But given the strong market rising asset values of.
Obviously, your lower leverage and you really have no committed capex from here any thoughts on lowering the required cash position.
I think Omar you know are in the in the you know far future of we might review that but I think for the you know there's the for the near and medium term you of.
Got to count on that $2.1 million per vessel being a rainy day fund.
Yeah of hopefully there won't be any rainy days, but are you net.
For now.
And just lab that day.
It's essentially lowers our debt.
Gives us further support to lower the those thresholds yeah, but.
And the in the not in the near or medium term.
Okay. That's fair I appreciate that and then maybe just a follow up.
You've now got your full suite in hand of 128 ships.
You've got a large footprint across all of the different asset classes on how are you guys doing things today are you still on the hunt for it through acquisitions.
Obviously, using your equity on possible or.
Or do you take a step back with that the prices have risen so much of the kind of any color there.
Well, you know look where we're still looking to grow.
And at such time as we can use our equity to make acquisitions of ships that increase earnings per share net increase net asset value per share net increase the dividend per share debt reduce the net leverage of the company and probably also reduced the fleet age.
For the company, we're going to do that you know as much as we can because that's what is the best thing for the shareholders and you know and the situation, where we're trading well, we should be able to do that.
Okay got it.
And just the to be cleared.
The acquisition debt.
Does your net leverage so in effect basically buying vessels for as much cash as possible on flash are lower than your current LTV, yeah, probably by buying the vessels you know without without debt, but if our if we're trading well enough. We can nevertheless increased earnings per share.
Dividends per share net asset value per share and probably also reduced the average age of the fleet. So it's it's gonna be Oh.
Quadruple or quintuple of win.
Yeah.
Clark.
Hey, good morning.
Thanks for the color there.
Okay.
Our next question is from Ben Nolan from Stifel. Please go ahead.
Yeah. Thanks.
I was going to ask maybe.
Maybe what sort of following on <unk> question, there a little bit not really about the dividend, but you guys announced an ATM program.
Most of the time when you've been doing these asset transactions, it's been shares for ships, but can you maybe just.
Talk me through a little bit like when and why you would be active under that ATM program I know that it doesn't the relation that you hadn't done anything with it yet but.
Just sort of maybe a little color around the rationale on how you would think about deploying it.
I mean, it's basically what what I told all of them are on.
Basically what we want to do is use the shares at the appropriate time to buy ships in such a way that it increases our earnings per share our net asset value per share our dividend per share reduces our net leverage and reduces our average fleet age and we.
We think we can do that pretty straightforwardly and N of market that is you know a little bit more friendly the dry bulk and the market. We see this morning, but yeah.
We think it's going to be actually quite easy to do that in the right market.
Okay.
So I guess, maybe the question is would you do it preemptively right you say, okay, well, we think we can buy something in the future that will be accretive to all of those things that you talked about so we'll go ahead and be retroactive or or we're going to do.
On where we're going to do the the thing that is the best thing for the shareholders.
Basically.
We want to basically add as much value to the share as possible on.
But I wouldn't expect debt, we would do something on.
On the 1 hand without having an opportunity on the other hand, I think we'll be pretty synchronized.
And then the discrete dose just to just to clarify at the levels that we're currently trading we would not use the ATM yeah that that can book the.
Yes, I shouldn't I should have said that we we have no intention of using the ATM and under.
The current conditions.
Okay very helpful.
And then with respect to sort of the market.
Some of the categories that were a little bit low like for instance, the Supermac soldier Max categories, maybe the Panamax category for a little bit lower than what we've seen in the market and I think that you'd said petros debt in the last quarter that you had sort of in the first part of the year put some of those on the shorter term contracts, which I would assume.
Kept the rates of little bit below where the spot market was any update on sort of your your coverage into the back out in the third quarter fourth quarter, maybe even into next year of little bit are there any sort of the lingering effects of the of some of that coverage.
Ben the actually we had covered 50, we had the cover 50% of our supra.
The fleet.
Towards the end of last year beginning of this year.
Relatively low levels and Thats why you saw this this effect and about 25% of our of Panamax fleet.
As we stand now for Q3, we only have a.
Another 6 so present for Panamax still.
Relatively low levels, when I'm, saying that I mean below 20000, and thats it and the nothing for Q4 onwards.
Okay, perfect and and and then all of them.
Just sort of maybe the follow on there and it'll be done or are you currently looking to take cover with the existing fleet.
At current rates are still sort of riding on the spot market.
We have we have as with all of the said covered about 65% of the fleet for Q3 at the levels of about of about 20 of them. The half thousand we have almost no cover for Q4 onwards are aware of it.
We very much believe in the market in the next few months actually in the next few years to be honest. So right now we are not intending to to hedge.
But the during Q4 the.
Pending on how things go and if the market is really strong we might consider.
As part of our fleet to be had for the first half of next year, but that has not been decided yet it will depend on how the market goes.
Perfect all right I appreciate it and thanks for all of the color.
Thank you.
Thank you. Our next question is from Randy given from Jefferies. Please go ahead.
The Donlin has gone.
I'm I'm, Randy Hi, Hey, so after all of these recent refinancings clearly your balance sheet is in great shape. Good decisions there to redeem the senior notes so with all of those moving parts. What do you expect the net change in total debt to be during the third quarter.
Okay.
And when you say net changed Randy you mean, the net change in interest and debt principal amortization, yes.
Just like total total debt I think right now it's like 155, something like that I guess on <unk>, what do you expect it to be at the end of <unk>.
So.
End of <unk>, our debt should be lower by approximately $50 million.
Okay.
Perfect.
Interest expense for the quarter, sorry, Oh.
Oh, Yeah go ahead.
Net interest expense for this quarter should be at around $14 million dropping too.
$12 million from the next quarters as essentially half of the cheaper debt kicking in.
Got it Okay. That's fair so.
So I guess that $50 million change on that maybe in other I don't know 20 million increase in working cap.
If rates, obviously stay where they are now it seems like 3.2 dividend could easily exceed the dollar is that fair.
Well I guess I Randy.
No you're of the Securities Analyst, we just run the shipping company.
Yes.
I am not address how engine.
An increase of 25 million in working capital.
<unk> reasonable given that we are in the continuously rising.
Freight environment.
Got it.
Hi, I'll I'll I'll go with my assumption from that and I guess last question for me speaking of good decisions for you right I applaud the share repurchase authorization over the last month rate asset values going up share price has been going down so with that now that your fleet is fully delivered you still have a few older.
The vessels. So you can reduce your average fleet age by maybe selling some of those so how do you view potential asset sales and then using those proceeds for maybe share repurchases in the near term.
To the extent there is an arbitrage to be done net favors the shareholders. We will look at it very seriously.
But other than the other than an arbitrage the favors the shareholders you know where we're at.
Not in the market to sell of ships.
Generally.
Sure I think the arbitrage of a very old ship at NAV and buying shares at a 25% of discount to NAV would qualify but I.
Well, thank you for the time.
Thank you Randy.
Thank you. The next question is from Amit <unk> from Deutsche.
The bank. Please go ahead.
Hi, everyone. Congrats on the results of the dividend payment I wanted to follow up on the last line of questioning regarding the the calibration of expectations for dividend payments for the third quarter.
On the map I want to walk through the cash flow of math, if that's okay for it for for a minute. So so first and foremost I think you said 28000.
Per day majority of days of books for the third quarter.
Basically the surplus of $17000 per day, you've got call. It 90 days, maybe a little bit under 90 day, so you're talking about close to $200 million of the incremental cash flows maybe a little bit under that.
In the in the third quarter alone.
I'm going to throw some numbers out of you tell me where I'm wrong.
Youre paying out a little over 70 million on.
In September we got some working capital build but net net you're you're probably looking at.
Well over $100 million or so of the incrementals cash balance on the.
The balance sheets so.
What's going on.
Wrong in the past because that would imply a.
Dividend payment of <unk>.
All over a dollar of dollars $20.30 per share.
What am I missing in many of the math on the numbers.
Well I you know it is.
The the math is the consequence of your assumptions about rates and and and and.
And working capital, but you know.
I don't know that there are any errors.
Yes, because you said the working capital of 25 million build <unk> 65 per cent of the days book, So I get the riskiest on the 35 per cent of the balance right.
Imagine net of 35 per cent balance would be accretive.
So you're all with the right today.
Would you agree with that or not agree with that.
Amit This is Kris those yes, I think we would probably agree with that.
Okay, great and so the other line of questioning he must you know you guys have embarked on this framework and strategy.
Of deleveraging of that.
Earmarking all of the surplus cash flow for dividends I think the the.
The end game is really to have the equity value of the company.
Capitalize those dividends, which appears sustainable at a healthy premium that gives you the currency to then grow the fleet or deleverage the fee fleet via the <unk>.
Currency that you have in the market, that's not working out as of.
As of right now and I understand they're not as of this morning, you know, but maybe next week.
Yeah. So I guess the question is is that you know cause.
Because of the stock right now is trading like it's trading like excuse me, it's not the actually even a little bit more than that and so.
If the market continues to not give credit to these payments how.
How steadfast are you and the management team and Petros and everybody committed to this framework if the market over the next 2 to 3 quarters continues to.
Basically not capitalize these payments at all.
We're incredibly stubborn people.
We're just unbelievably stubborn and we're going to keep at it until it works.
Okay, and then the last point on the ATM.
No.
I understood. The question I have is is that you're basically telegraphing.
Equity offerings down the road, which may actually be counterproductive and capping the.
The opportunities of the equity in the first place so what's the thought behind the ATM in that respect when you know essentially it could be counterproductive and having the market gives you credit for what you guys are doing well.
Well the answer is we're not going to use the ATM in a way that's counterproductive to the share price, we're only going to use the ATM in a way that's accretive to earnings per share net asset value per share dividends per share reduction of the company's net leverage and reducing the average fleet age.
In what way is that going to be bad for the share price, we're not going to use the ATM in anyway that will injury of the share price in the slightest way just the opposite.
Got it Okay and then the last question for me if I could.
Is the.
The asset value environment, 1 of the things that really move the share price up from 10 to $20 on the realm.
A little of the short period of time was obviously you did this.
I said value cycle that we had of mini cycle that we had where we're at.
Is that has that stalled out a little bit of if you can just sort of overly liquid market. So I'd love to get some perspective on how we've taken a pause in the upside on asset values.
They come in a little bit what's the what's the overall feel out there.
Well Amit the we're looking at historical.
Levels of prices in AR, and the incomes and we are seeing that.
Prices have actually lagged incomes. So I don't know if that is psychological in the has to do with the fact that we've been.
We've been the knot.
Not in great markets for the last several years or whether it is COVID-19 related or I don't know what the other fears people may have but.
I want to repeat that were extremely positive in this company not only for the next couple of years, but for several years for award.
Because of the environmental regulations, which we think all of our mainframe because.
He is going to in those slow steaming scrapping.
Less ordering.
The delays in the yards off higher interest it will affect supply in the very strong way. So we think there's going to be a strong market. Perhaps people are not yet persuaded the these good market can continue for long we think it will end after awhile, if we're right on.
I believe that.
The vessel prices will catch up with our the rates we're seeing.
Got it okay that makes sense. Thank you for taking my questions. Congrats again appreciate it thanks Tom.
Thank you all the next question is from Jamie It's my of from value Investor's edge. Please go ahead.
Hi, Good morning, good afternoon, gentlemen, congrats on the fantastic quarter.
Thank you Jay.
I think the the dividend has been well covered I appreciate the analysts in front of me asking great questions. There on the only question I would add to that as you out of the 50 million repurchase authorization. How do you prioritize that in comparison to keeping net cash available for the Q3 payouts on is is it based on like a function of price to NAV, how do you think about that.
No, it's actually pretty straightforward, we really have no intention of reducing the dividend as a result of share buybacks. If we are to use the share buyback authorization. It would be an arbitrage between vessel prices and share prices.
And we would probably fund it by selling of vessel or 2 and using the the.
The cash released by that vessel to buyback the shares.
We wouldnt be using cash that would otherwise go into a dividend at least certainly that's not the current intention.
Okay that seems reasonable so yeah definitely here at the other channel as it looks like of dollars. The very low end of next quarter's dividend then that's good to see.
Do you have any interest in acquiring potentially other equities and dry bulk firms. There's a couple of firms, including 1 major U S listed firm, which owns exclusively of mid size of assets, which has high private equity ownership, which trade at 70 to 80 per cent price of Nab is is there any interest in some sort of stock acquisition that way.
I mean.
We we always are interested in in the acquisitions that could be accretive to our earnings per share on our dividend per share on our net asset value per share and so on but.
You know frankly I at this moment.
Haven't been we haven't been looking at any of the examples that you mentioned.
In an active way.
Yes.
Yeah. It certainly makes sense I appreciate the heavy focus on per share metrics and I think the whole industry will be in a better place if that focus continues thanks again gentlemen.
Alright.
Thank you.
Question, that's the waiting I'll now hand, the call back to the speakers for any closing comments.
No further comments operating so thank you very much.
Ladies and gentlemen that does conclude the call for today. Thank you all for joining you may now disconnect.
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