Q4 2021 MarineMax Inc Earnings Call
Good morning, and welcome to Marine matching 2021 fiscal fourth quarter and year end conference call.
Today's conference call is being recorded.
At this time I'd like to turn the call over to Don Frankfurt of ICR Investor Relations for Marine Max. Please go ahead.
Thank you operator, good morning, everyone and thank you for joining this discussion of marine massive fiscal fourth quarter and year end 2021 results.
I'm sure that you've all received a copy of the press release that went out this morning, but if not please call Linda Cameron at seven to 75311712, and she will email one to you right away.
I now would like to introduce the management team of Marine Max Mr. Brett Mcgill President and Chief Executive Officer.
And Mr. Mike Mclamb, Chief Financial Officer at the company.
Management will make a few comments about the quarter and then be available for your questions.
And with that in mind, let me turn the call over to Mike. Please go ahead Mike.
Thank you Don good morning, everyone and thank you for joining this call before I turn the call over to Brett I'd like to remind you that certain of our comments are forward looking statements as defined by the private Securities Litigation Reform Act. These statements involve risks and uncertainties that could cause actual results to differ materially.
Some expectations.
These risks include but are not limited to the impact of seasonality and weather general economic conditions and the level of consumer spending the company's ability to capitalize on opportunities or grow its market share and numerous other factors identified in our Form 10-K, and other filings with the Securities and Exchange Commission.
With that in mind I'd like to turn the call over to Brett right.
Thank you Mike.
Good morning, everyone and thank you for joining this call.
I am very proud of the extraordinary achievements of our team in fiscal 2021.
Record revenue of more than 2 billion record gross margin of over 30% Rec.
Record earnings per share all while achieving record net promoter customer satisfaction scores give.
Given the extremely lean inventory and well documented supply chain issues. This is a great achievement in 2021.
I wanted to thank the entire marine Max team for their hard work and persistence, which enabled us to finish the year with $6 78.
And earnings per share compared to our guidance of $6 40 to $6 55.
Today I'd like to share highlights from our fourth quarter and full year, followed by a discussion of the results of our strategic growth plan, which will continue to create shareholder value in 2022 and beyond.
Then Mike will discuss our financial results in more detail and provide color on our 2022 financial outlook.
Let me start by touching on our fourth quarter and full year performance for.
For the quarter, we generated 16% revenue growth record gross margin of almost 38% and record earnings per share of $1 45.
I am extremely pleased that our strategic acquisitions are exceeding expectation and diversifying our model, resulting in robust margins and earnings growth.
Our same store sales for the quarter were down 7% versus 33% growth a year ago, our supply chain challenges and lean inventory environment worsened and impacted us as we move through the later part of the quarter.
However, demand remains strong and we see no softening as consumers are still actively seeking the boating lifestyle.
This strong demand environment as highlighted by our customer deposits, which jumped more than three times last years level to over $100 million.
Last year was elevated with increased demand. So this increase this year is a significant sign of strong and growing demand.
For the full year same store sales growth was over 13% on top of 25% a year ago are.
Our significant geographic and product diversification, along with the effective utilization of our digital platform are driving profitability and growth.
The marine industry is continuing to experience an influx of new boaters, given our scale and global presence, we are benefiting from our growing share of the market and based on available industry data. We believe we continue to gain market share.
From a cadence perspective, the supply chain headwinds deteriorated as we move through the quarter.
I want to emphasize that we are not seeing a demand issue rather the timing of shipments is impacting our ability to fulfill some customer orders and therefore recognize revenue simply.
Simply put if we had the boats they would be delivered and we'd have even higher revenue.
We are working closely with our manufacturing partners to satisfy the strong demand, but as many experts in the industry are forecasting it will likely not improve materially until later in fiscal 2022.
It's a unique environment and one that is challenging to predict but our team will continue to perform.
I also want to underscore our strategic growth plan and how it is not only driving market share and revenue growth, but expanding companywide margins.
This quarter, we increased our operating margin by 130 basis points over last year's record to nine 5%.
We also finished the fiscal year with an operating margin increase of more than 300 basis points to over 10%.
This performance is directly attributable to our ability to execute our strategy focusing on higher gross margin businesses, including charter finance insurance Marina storage parts service and brokerage.
The gross margin strength, we produced in the first nine months of the year accelerated in the September quarter.
Additionally, as we integrate our acquisitions they continue to outperform and are aligned with our strategy of distributing to marine Max's record margin expansion.
Specifically each company, we have acquired has outperformed their best year or is on pace to outperform their best year.
Earlier. This month, we shared that we have entered into an agreement to buy Intrepid Powerboats. Many of you know that intrepid has an iconic brand led by one of the best management teams in the industry.
We are very excited about having Ken Clinton in the Intrepid team joined the Marine Max family.
We plan to support them with their innovative plans provide them capital and arm them with the tools to better serve the intrepid nation.
Now, let me discuss our confidence we have that our strategy will continue to create sustained growth and long term shareholder value in 2022 and beyond.
We continue to make significant progress on our vision of creating exceptional customer experiences through best services products and technology.
Our team remains focused on these initiatives, resulting in strong demand and margin.
We will accomplish this through our global market presence premium brands valuable real estate locations exceptional customer service technology investments.
<unk> acquisitions industry, leading inventory management and finally, a continued commitment to build on our strong company culture.
Supported by one of the strongest balance sheets in the industry, we will continue to make strategic accretive acquisitions in a disciplined manner.
The combination of being well capitalized and having a broad global geographic presence has allowed and will allow us to grow in many ways by adding additional dealers Marina storage service related offerings manufacturing and asset light business, such as our Super Yacht services business.
We continue to have strong demand and are ready to keep serving our loyal customers.
As supply constraints are resolved by manufacturers, we expect to ramp sales in the future.
Our scale continues to be a competitive advantage as we leverage our deep manufacturing relationships are nationwide shared inventory and our strong balance sheet to support the growing demand.
We believe the combination of driving operating leverage and generating significant cash flow coupled with strong consumer demand will result in sustained growth well into fiscal 2022 and beyond.
And with that update I'll ask Mike to provide more detailed comments on the quarter Mike.
Thank you Brett and good morning again, everyone.
I'd like to start by thanking our team for producing another record quarter and year underscored by strong operating leverage and significant free cash flow generation.
For the quarter revenue grew 16% to over $462 million, even with the lean inventory environment as we benefited from the accretive acquisitions, we completed during the year.
Overall, our growth has been demand driven across generally all segments of products and across every global market.
We expected inventory to remain low through the quarter, but with the increased supply chain challenges retail deliveries grew more challenging which impacted revenue in excess of $50 million.
This led to the decline in same store sales growth.
Our units declined in the quarter double digits.
While our average unit selling price continues to expand.
However, with increasingly stronger customer deposit visibility, coupled with our broad product portfolio and production insight from our manufacturing partners.
We believe we are better positioned than most in our industry, resulting in market share gains in all our major segments.
Gross profit dollars increased over $58 million, while our gross margin rose 860 basis points to almost 38%.
Our initiatives to drive margin growth over the last several years continue to generate solid results.
Margins rose with contributions from multiple segments and businesses, including new and used boats storage parts and service higher margin finance insurance and brokerage businesses as well as our global Super Yacht services businesses, Northland Johnson and Fraser yachts.
As expected with Europe reopening we did see improved sales in charter revenue in August and September of this year about half of our margin improvement came from the growth that our Super yacht services businesses.
Regarding SG&A the majority of the increase was again due to rising sales and related commissions combined with the recent acquisitions.
SG&A rose as a percentage for a few reasons, we did expect significantly more sales, which are not lost but delayed. Additionally.
Additionally, as our higher margin businesses grow the compensation related those businesses are higher.
We had elevated acquisition costs and a smaller quarter not to mentioned some cost inflation.
We believe SG&A overall is generally on track on an annual basis, but we will watch the inflationary pressures carefully.
Our operating leverage in the quarter was about 15%, which drove very strong earnings growth setting another quarterly record with pretax earnings of over $43 million.
Our record September quarter saw both net income and earnings per share rise over 21% generating $1 45 in earnings per share versus an adjusted $1 19, a year ago.
For the full year I will make a few comments.
The acquisitions, we completed were all successfully integrated resulting in record setting results for each Additionally, the acquisitions, we completed over the last few years are all contributing greatly to our results.
The management teams of each acquired company also are contributing to our overall success.
Our ability to acquire and integrate companies is greater today than at any point in our history.
During the year, we added significantly to the strength of our balance sheet, while continuing to make significant long term investments at our real estate portfolio.
Our digital capabilities and our team.
Lastly for the full year, our EPS was close to double the midpoint of our initial guidance and I would add that $6 78 is a pretty strong year.
Moving on to our industry, leading balance sheet, we continue to build cash with over $220 million.
Our inventory at quarter end was $231 million down, 22%, excluding skipper buds and cruiser yachts inventory declined about double that percentage.
Looking at our liabilities short term borrowings decreased sharply due to lower inventory and related financing as well as an increase in cash generation.
Due to the demand we are seeing customer deposits as Brett said more than tripled to over $100 million setting another new record.
Our current ratio was over two and our total liabilities to tangible net worth ratio is at one both of these are very impressive balance sheet metrics.
Our tangible net worth is about $400 million.
Our balance sheet has always been a formidable strategic advantage and now more than ever it provides the capital for growth and expansion as opportunities arise and good or bad times.
Turning to our guidance for fiscal year 2022.
Fiscal 2021 in the September quarter generated significant operating leverage and demand remained strong.
The challenge with projecting 2022 or the assumptions around the supply chain.
Today, given what we're being told from our various manufacturing partners. We do expect retail unit growth in 2022.
However, until we see more stabilization in the supply chain, our guidance assumes basically flat units.
This combined with increases in our average unit selling price should provide annual same store sales growth in the mid single digits.
Including the remainder of the cruisers and <unk> acquisitions, we expect total annual revenue growth in the high single digits to 10%.
Given the inflationary pressures in the marketplace, we do expect modest margin pressure.
We have levers to mitigate these pressures, but believe it's prudent to included in our expectations for now.
Our guidance is also before any other acquisitions that we may complete including a trepid.
Using the low end of our historical leverage range.
A modest share increase in the tax rate of 25%.
<unk> and our earnings per share guidance range of $7 20 to $7 50.
Obviously, we expect to update you throughout the year as our visibility increases on the supply chain.
Turning to current trends October is forecasted to end with positive same store sales growth and our backlog is at record levels as.
As we have said industry demand remains strong and we are generally outperforming these elevated levels.
With those comments I'll turn the call back over to Brett for some closing comments alright.
Thank you Mike.
2021 generated landmark metrics for marine Max and I am very proud of our team's ability to execute on our strategy and to successfully integrate our recent acquisitions driving superior operating leverage.
We are pleased to see our business continue to build strength and are confident in our strategy for 2022 and beyond.
Our operating margin ended the fiscal year at over 10% almost double 2019.
This is the result of our team's commitment to capitalize on the strong industry demand.
While we know we will face a few challenges related to the supply chain and inventory as we start fiscal 2022.
Beyond our organic growth, we will pursue additional brand expansion and higher margin businesses to support our strategy to create long term shareholder value.
And with that operator, let's open up the call for questions.
Thank you ladies and gentlemen at this time, we will begin ducking your question and answer session. If you'd like to ask a question you May press star one on your telephone keypad.
Information tone will indicate your line is in the question queue.
Press Star two if you would like to remove your question from the queue.
All participants using speaker equipment, it may be necessary to pick up your handset before pressing the star key.
Our first question comes from the line of Joe Ulta Bello with Raymond James. Please proceed with your question.
Good morning, guys. This is Adam on for Joe Congrats on a strong year.
I was curious I wasn't sure if you could break down maybe quantify different components of the gross margin improvement from the 29%, 30% you've been running the last four or five quarters versus now.
Yes. Thank.
Thank you Adam I can I can talk on the current quarter I mentioned that half the margin expansion.
From the very strong performance of our Super Yacht services businesses, Frazier and Northland Johnson the rest of it in the quarter is almost all our higher margin businesses expanding.
One of the things when same store sales decline it gives us higher margin businesses.
A chance to kind of catch up so we saw an increase as a percentage of revenue in our Marina business and our service business in parts and accessories in F&I.
All of which led to the very high margin in the quarter, new unused products accounted for a very small.
Of the increase in the quarter, because remember last year, we started to see an increased demand and product margins were expanding at this time last year as well.
On a year to date on an annual basis when you look at the.
The 32% consolidated company margin versus the 26% last year less than half of it is due to new and used product margin expansion, probably 35% something like that would be product margin expansion in the rest of it is the expansions at our higher margin businesses again are.
<unk> services businesses.
The investments we've made in our marine businesses, our service parts and accessories F&I all of those businesses driving the rest of it so.
Hopefully that answers your question a little bit.
No that's great. Thank you Mike.
Also I know you guys alluded customer deposits, obviously, a good metric, but not perfect.
Are there any store traffic and lead generation statistics, you guys could give in terms of year over year metrics are.
Or is that kind of not going to be disclosed at this time.
Hey, this is Brett we Adam.
We don't disclose the actual metrics on that but we actually track that daily weekly monthly everything from web traffic to leads that we're generating et cetera, and we see it.
Anywhere from ranging to flat to last year to up a little it depends on the day and the week, but <unk>.
Store traffic also.
<unk> holding strong.
The boat shows that we have attended had great traffic coming through those so we anticipate we don't see any softening of the demand pipeline.
Possibly even some increase.
Awesome. Thank you Brad if I could squeeze one more in are you guys still seeing elevated levels.
First time buying I know you've alluded to in over several calls.
Our first timers that bond and model year, 'twenty or model year 'twenty, one returning to upgrade or is it perhaps too early to tell.
You get a good sense for that that's all for me.
Yes, Adam.
We track it very well and look at it first time buyers new to Marine Max we continue to see those levels elevated.
Still more and more new people coming into to our family and yes. We do have groups of people that have already upgraded some of those.
Bought newer boats. So those trends are great. They were great last year, and we see them continuing bringing all these new people into voting is going to be have a very positive effect and so we're excited.
Awesome. Thank you gentlemen, thank you Adam.
Our next question comes from the line of Mike Swartz with Truth. Please proceed with your question.
Hey, guys good morning.
Just to maybe help us understand I mean, I think you summarized it pretty clearly that your guidance assumes kind of flattish comparable unit sales for 'twenty two.
Help us think about how that kind of.
Trends through the fiscal year I'm, just trying to understand is this more of a back half weighted year, just given the timing of deliveries and some of the supply chain bottlenecks just help us think about the cadence for the year.
Yeah, Great question, Mike and clearly with us have been pretty strong same store sales growth to start 2021, we had 20% growth in the December quarter, and 45% growth in the March quarter, both of which were unit driven in addition to leveraging that selling price both of them contributed so.
So, yes, I think youll see more growth in the back half of the year, where we had 6% same store sales growth in the June quarter, which we did comment our units were actually down that quarter and then obviously were negative this quarter with units being down again, so we do see it being more quite frankly in a better time of the year for us as the seasonal highlight for us in the summertime.
And it also is when hopefully the supply chain will be working more of the bugs out of it by then and things will be in a better position to have that growth.
Okay, Great and then maybe just also talk about I mean, one of the big questions. We're getting is just the sustainability of margins into 'twenty, two and obviously fourth quarter was.
Well above expectations from a from a margin perspective, so maybe walk through some of the puts and takes where you feel comfortable where maybe theres a little more pressure throughout the year.
Yes. Good question again, Mike I think the pressure and I alluded to it in the prepared remarks.
Just with the inflation, that's coming in the industry and while we're still being very successful passing price increases on today to consumers. We did bake in a little bit of extra pressure and we do actually have specifically in our guidance margins coming down slightly in 2022 because of the inflationary pressures, we're seeing we do think that.
With our ability to continue to focus on these higher margin businesses. Those are some of the levers we can pull to try to offset some of the product.
The pressures that we do expect Mike.
Last quarter was a little bit of a sample of when sales were down a little or higher margin strategy. These businesses kind of shine through a little bit.
So yes as long term as maybe a discounting environment comes back whenever that might be that will put pressure on the new and used boat, but we've been working hard for several years now on really loading up these high margin businesses that will kind of shine through a little bit clear.
Okay, and just maybe maybe maybe one point of clarification on your comments, but I mean do you expect.
Kind of a promotional environment.
Clinical at normal promotional environment to return in your fiscal year 'twenty, two or do you think thats couple of years out no. Thanks for it yes, I want to clarify that we don't see with the inventory levels.
Being where there'll be I can't imagine there'd be any.
Real pricing pressure.
In the <unk>.
For for a while especially not in 2022.
Little concerned like Mike mentioned around.
Some some margin erosion, we're a little bit just based on.
Price protection and input increases, but definitely not in it's not a discounting environment and promotional thank you.
Okay, great. Thank you guys. Thanks, Mike.
Our next question comes from the line of Eric Wold with B Riley. Please proceed with your question.
Thank you good morning, guys.
So you talked about.
We do not see any any degradation in demand and traffic demand and deposits are still changing right direction. What are you. What are you seeing in terms of kind of.
Pricing acceptance, obviously, we're seeing prices move up closer to the pressures in labor constraints and whatnot from the Oems.
What are you doing here, you're passing those along all intersecting our consumers.
Around.
Can you kind of anecdotal evidence of that.
Are you beginning to hire they still finds a little.
It's a great question, we monitor very closely.
We're still looking at trying to price the boats to market, even though all of these costs continue to creep in.
So we're watching that closely right now there doesn't appear to be any I'll call. It balking at the.
The price increases.
There youll keep in mind too that the innovation of these products and the new technologies coming out continues to help support all of that so right now no pressure on it but it is something we look pretty far out in the future to say.
The tolerance level there.
And then it will vary based on brand and type of boat all that but what are you in general quoting buyers in terms of when they can expect to receive bank. For example, you got the Fort Lauderdale show come up you know what when are people looking at changing the way in deliveries.
We have boats that are available.
Pretty quickly right now and with the size of our inventory management or I guess.
The breadth of the inventory, we have coming up let's say the Lauderdale here. Our team has a large inventory that they can leverage to get boats.
It can be a month or two or three of course. There are some models that are really far out into the future, but most of them can be if somebody is looking for a boat now for the north they can have it by spring.
Okay, and then final final question.
You've highlighted the <unk>.
Opportunity around the <unk> businesses.
Since you've expanded.
Marina and storage enough and I know that you've made to your OEM acquisitions over the past six.
Six or so months.
The holes in your product portfolio could be slowed by additional manufacturing acquisitions or would you view those as more of the one offs you often speak.
Yes, I mean, those were we're very excited about those acquisitions and what they can do and the growth opportunity and I think I've said before it's not a new strategic direction that we're taking off into.
But we will continue to look to see if there's other opportunities.
As they arise, but it's not a brand new strategic direction that we're running towards.
I understand thank you Bob.
Sure.
Our next question comes from the line of Scott <unk> with C. L. King. Please proceed with your question.
Hi, guys and congrats on a great quarter. Thanks, Scott.
Can you maybe talk about the cadence of sales throughout the quarter was it.
Really chugging along through the end of the quarter and it sounds as if you talked about how.
I guess October is off from a units perspective, what changed to bring that around any dynamics in the market more supply.
Great Great question that in a normal time, when you have plenty of inventory at all of the supply issues.
The only thing that could explain negative same store sales to positive same store sales with a flip of a switch.
I mean, you would really have a hard time, explaining that but in the current world, it's literally because of shipments coming for manufacturers and the ability to get products. So throughout the quarter.
Our ability to get product or a manufacturer getting us products worsened for various different issues in each manufacturer had a different issue, but it worsened as the quarter went on.
As you wind data September come into October we received some of the product we thought we'd have in August and September plus some product that was ready for October.
And so October should finish up with same store sales so that it kind of speaks to the.
A little bit of the volatility of the supply chain right now it's not a it's not a demand issue that would be driving or not driving sales. It's more of just product availability.
Got it so there will be volatility there could be a down month and in the months ahead. It just all depends on supply.
You know what it's based on again input we have with our manufacturers, we feel pretty good about things, but the answers is yes. It's just it's subject to us working through the different supply chain challenges with the with our manufacturing partners.
Got it and just last question you talked about your guidance I guess is based off of the conversations you've had with your OEM partners.
About I guess inventory and supply chain what are.
What are you assuming and what are they telling you.
And when should we see.
<unk> of some of these issues.
Well, that's the $64 question that I think every company in the World is being asked right now is once the supply chain going to fix itself.
I don't think anybody knows for sure I think everybody is believing that the supply chain will be in a better position as we go through 2022, but specifically to the first part of your question. The feedback we're getting is that we expect.
Unit growth in 2022 retail for the industry and for us.
Based on the input from our manufacturers now in our guidance. We don't have unit growth is flat unit growth is really basically just some inflationary based increases in our average unit selling price plus. The addition of the remainder of the cruisers and the initial acquisition, which is getting to the high single digits to maybe to maybe 10%.
It's important to remember, though for everybody on this call I mean, the industry today in 2021.
Down in units.
It went from being up in units to down 8% in units overall.
And so you've got to so you got to think as you think about 2022 with the demand that's out there.
As long as there's any improved any slight improvement in the supply chain. The demand is there to comp negative comp. So in 2000 22020, there was massive unit growth, but sitting here today. The industry is down 8%. So it's not like we're comping up against a real big unit comp as an industry.
So.
That helps with our belief as to what could happen in 2022, just working our way through the supply chain is what we need to do.
Got it that's all I have thanks, Thanks Scott.
Our next question comes from the line of James Hardiman with Wedbush Securities. Please proceed with your question.
Hi, This is Sean Wagner on for James I, just wanted to clarify 1.1st.
October is looking like it's going to be up.
On this from a same store sales growth perspective.
But just to clarify our units going to be up as well or are they just meaningfully better than the double digit decline that you saw this last quarter.
I don't have the unit forecast right in front of me, Sean I don't recall, if units are going to be up or not again for the full year were assuming units will be.
Flattish at our guidance range right.
Alright, and then it gets better throughout the year just gone.
Comparisons that's correct.
Okay and then.
Any idea kind of.
Where are the.
The double digit decline in the quarter, obviously that got worse through the quarter as availability got worse.
If you had the product that you wanted any idea whether that could have been at the same store sales could have been I know you've talked about the traffic kind of metrics that you look at being anywhere from flat to up slightly is that right.
Reasonable number that could have been attained units was.
Ability wasn't an issue.
Well, so we were expecting obviously same store sales growth in the quarter, given the $50 million drop in revenue.
I really to answer your question as a matter of fact, we had the product we had very strong unit growth just look at that as just a fact of the 100 $100 million customer deposits. We have on our balance sheet. The demand is very strong before seeking product today.
I think it would fix the units in the industry I think it's a I think the overall industry and also us I'd say inventory issue not a not a demand issue.
Right right, Okay, and one last quick question I guess, one of the main kind of bear cases, we're hearing or.
All of the talk of.
Kind of new customers that we've seen over the last year and a half and those trends seem to still be strong but are you starting to see any evidence or expect to see in the next year kind of anybody exiting the lifestyle or trading in their boats have you seen any kind of uptick in used boat availability or anything like that.
Yes.
No no uptick in used boat availability, that's still hard to come by so that and there is been a few great success stories of people that bought last year already upgrading this year.
That's kind of common in our business when we get new people in but and then the third thing I'll say is back to year, beginning there which was.
We still see new people entering the industry.
Entering marine Max as a new customer to us, but nothing that shows they're getting out or nothing shows that that percentage of new people is declining.
Okay. Thanks, a lot guys.
Okay.
Okay.
Our next question comes from the line of David Macgregor with Longbow Research. Please proceed with your question.
Hi, This is Joe <unk> for David.
Hey, Joe.
I was just hoping you could talk about the impact that acquisitions had on our gross margins in the quarter.
And then along with that if you could talk about the supply channel for your recent acquisition.
And just that theyre dealing with relatively similar supply constrained.
Joe we have a bit of a bad connection I think your first question was on the impact of acquisitions on gross margins.
And I would comment that the acquisitions, we made a number of years ago Frazier Northland Johnson, either a year ago or two years ago, where great drivers of the margin growth that would contribute about half of the overall gross margin growth in the quarter.
Cruisers would've had a contribution but it would have been not as significant as the.
Fraser the north of our Johnson and then Miss Wall that we merged with on July one.
Are there larger service and storage business profile, they would have contributed some as well but.
As we mentioned on the call have the margin increase was Fraser Northrop and Johnson and the rest of it was really the expansion of all of our higher margin businesses.
And it may not have heard the other parts of your questions.
On the recent acquisition you ask about the supply chain constraints and I think I would categorize that as we're seeing.
The same thing that the industry stay and it's hit or Miss daily Battle to get through it and try to get those completed.
Help our stores out so.
That's helpful. Thanks, I'll pass it along.
Thank you Jeff.
There are no further questions in the queue I'd like to hand, the call back to Brett Mcgill for closing remarks.
Well. Thank you everybody for joining the call today and both Mike and I are available. If you have any additional questions and we're looking forward to updating you on our progress on our next call have a great day.
Ladies and gentlemen, this does conclude today's conference. Thank you for your participation you may disconnect. Your lines at this time and have a wonderful day.