Q3 2021 Re/Max Holdings Inc Earnings Call

Good morning, and welcome to the Remax Holdings preliminary third quarter 2021 earnings conference call and webcast. My name is Julian and I will be facilitating the audio portion of today's call.

Speaker 1: Good morning and welcome to the RE-MAX Holdings Preliminary 3rd Quarter 2021 Earnings Conference Call and Webinar. Good morning. Good morning. Good morning and welcome to the RE-MAX Holdings Preliminary 3rd Quarter 2021 Earnings Conference

Speaker 1: My name is Julianne, and I will be facilitating the audio portion of today's call. At this time, I would like to turn the call over to Andy Schultz, Vice President of Investor Relations. Mr. Schultz.

At this time I would like to turn the call over to Andy Schulz, Vice President of Investor Relations Mr. Schulz.

Speaker 2: Thank you, Operator. Good morning, everyone, and welcome to REMAX Holdings Preliminary Third Quarter 2021 Earnings Conference Call. Please visit the Investor Relations section of REMAXholdings.com for all earnings-related materials and to access the live webcast and the replay of the call today. If you are participating through the webcast, please note that you will need to advance the slides as we move through the presentation.

Thank you operator, good morning, everyone and welcome to Remax Holdings preliminary third quarter 2021 earnings Conference call. Please visit the Investor Relations section of Remax Holdings Dot Com for all earnings related materials and to access the live web.

Cast and a replay of the call today.

If you are participating through the webcast. Please note that you will need to advance the slides as we move through the presentation.

Speaker 2: Turning to slide 2, our prepared remarks and answers to your questions on today's call may contain forward-looking statements. Forward-looking statements include those related to agent count, franchise sales, financial measures and outlook, brand expansion, competition, technology, housing and mortgage market conditions, capital allocation, dividends, strategic and operational plans, and business models. Forward-looking statements represent management...

Turning to slide two our prepared remarks and answers to your questions on today's call may contain forward looking statements forward. Looking statements include those related to agent count franchise sales financial measures and outlook brand expansion competition technology housing and mortgage market conditions capped.

Allocation dividends strategic and operational plans and business models forward.

Forward looking statements represent managements current estimates Remax holdings assumes no obligation to update any forward looking statements in the future.

Speaker 2: REMAX Holdings assumes no obligation to update any forward-looking statements in the future.

Forward looking statements address matters that are subject to risks and uncertainties that may cause actual results to differ materially from those projected in forward looking statements.

Speaker 2: Forward-looking statements address matters that are subject to risks and uncertainties that may cause actual results to differ materially from those projected in forward-looking statements.

Speaker 2: These are discussed in our preliminary third quarter 2021 financial results press release and other SEC filings. Also, we will refer to certain non-GAAP measures on today's call. Please see the definitions and reconciliations of non-GAAP measures contained in our most recent quarterly financial results press release, which is available on our website.

These are discussed in our preliminary third quarter 2021 financial results press release and other SEC filings also we will refer to certain non-GAAP measures on today's call. Please see the definitions and reconciliations of non-GAAP measures contained in our most recent quarterly financial results press release.

Which is available on our website.

Speaker 2: Please note that our third quarter 2021 financial results and other related information discussed on this call are preliminary. Our final results and financial information for the third quarter 2021 may vary materially from the preliminary financial information discussed on this call.

Please note that our third quarter 2021 financial results and other related information discussed on this call are preliminary or final results and financial information for the third quarter 2021 may vary materially from the preliminary financial information discussed on this call.

Speaker 2: Joining me on our call today are Adam Kontos, our Chief Executive Officer, Kerry Callahan, our Chief Financial Officer, Nick Bailey, President of RE-MAX, and Ward Morrison, President of Model Franchise.

Joining me on our call today are Adam Contos, our Chief Executive Officer, Karri, Callahan, our Chief Financial Officer, Nick Bailey, President of Remax, and Ward Morrison President of motto franchisee with.

Speaker 2: And with that, I'd like to turn the call over to REMAX Holdings CEO , Adam Kontos. Adam?

I'd like to turn the call over to Remax Holdings, CEO, Adam Contos Adam.

Speaker 3: Thank you, Andy, and thanks to everyone for joining our call today. Looking at slide three, we again posted record financial results in the third quarter. Our strong performance was driven by better than anticipated results from our recent acquisition of REMAX Integra's North American regions, broad-based contributions from our core operations, and a healthy housing market in both the U.S. and Canada.

Thank you Andy and thanks to everyone for joining our call today.

Looking at slide three we again posted record financial results in the third quarter. Our strong performance was driven by better than anticipated results from our recent acquisition of Remax Integra is north American regions broad based contributions from our core operations and a healthy housing market in both the U S and Canada.

Speaker 3: We believe the third quarter was a strong affirmation of our strategy. Over the past few years we've been investing to diversify and expand our revenue and growth opportunities. Our third quarter results illustrate how those efforts are paying off.

We believe the third quarter was a strong affirmation of our strategy over the past few years, we've been investing to diversify and expand our revenue and growth opportunities our third quarter results illustrate how those efforts are paying off.

Speaker 3: Motto is perhaps the best example of that expansion and diversification. Motto recently celebrated its fifth birthday, and the brand is truly coming of age. Franchise sales remain brisk, and the open office count was up more than 30% year over year during the third quarter. We expect Motto to start generating a profit beginning next year, which is a notable achievement for our startup franchise.

Motto is perhaps the best example of that expansion and diversification.

Motto recently celebrated its fifth birthday, and the brand a truly coming of age franchise sales remained brisk and the open office count was up more than 30% year over year during the third quarter.

We expect motto to start generating a profit beginning next year, which is a notable achievement for our startup franchise.

Speaker 3: Overall, REMAX Holdings revenue for the third quarter was $91 million, an all-time high, with much of the year-over-year increase driven by our recent Integra acquisition, which so far has exceeded our expectations.

Speaker 3: Among our other recent acquisitions, Gadbury Group, now called G73, was another outperformer hosting a quarterly profit.

Among our other recent acquisitions Gadberry group now called <unk> 73 was another outperformer posting a quarterly profit first.

Speaker 3: First, in WEMLO, our two tech startups are both showing steady progress, and we expect to see more meaningful revenue contributions from them in 2022. Excluding the marketing funds, our core business generated almost 7% organic revenue growth in the third quarter, with contributions from multiple facets across the company.

First and we low our two tech startups are both showing steady progress and we expect to see more meaningful revenue contributions from them in 2022, excluding the marketing funds, our core business generated almost 7% organic revenue growth in the third quarter with contributions from multiple facets across the company.

Speaker 3: As our acquisitions lap their respective first year anniversaries and start to fill more of the organic bucket, we're confident we'll see continued organic growth, which we expect to be in the mid-single digit.

As our acquisitions lapped their respective first year anniversaries and start to fill more of the organic bucket. We're confident we'll see continued organic growth, which we expect to be in the mid single digits. We will continue to drive additional organic revenue growth leveraging the strength of our business model as much of each incremental.

Speaker 3: We will continue to drive additional organic revenue growth, leveraging the strength of our business model, as much of each incremental dollar of revenue tends to translate into profit.

Dollar of revenue tends to translate into profit.

Speaker 3: We saw that dynamic play out in Q3 as we generated a record-adjusted EBITDA of $35 million and record-adjusted diluted EPS of $0.71.

Saw that dynamic play out in Q3, as we generated a record adjusted EBITDA of $35 million and record adjusted diluted EPS of <unk> 71.

Speaker 3: These strong results enabled us to, again, increase our profit guidance for 2021. Kerry will update our outlook in just a few minutes.

These strong results enabled us to again increase our profit guidance for 2021.

Kerry we'll update our outlook in just a few minutes.

Speaker 3: As I noted earlier, our Integra acquisition is off to a great start. This is a large, complicated, and important investment. Tremendous progress has been made to date with significant portions of the integration already completed, primarily where we have prioritized transitioning to customer-facing elements of the business.

As I noted earlier, our Integra acquisition is off to a great start. This is a large complicated an important investment tremendous progress has been made to date with significant portions of the integration already completed primarily where we.

We have prioritized transitioning that customer facing elements of the business the.

Speaker 3: The teams involved are doing a terrific job and are focused on ensuring that our franchisees and agents continue to receive the outstanding support, services, and products they need to help them grow their business.

The teams involved are doing a terrific job and are focused on ensuring that our franchisees and agents continue to receive the outstanding support services and products they need to help them grow their businesses.

Speaker 3: For the immediate future, at least the remainder of this year and the first part of 2022 will focus largely on facilitating a smooth transition and enhancing the future growth trajectory of this significant investment.

For the immediate future at least the remainder of this year and the first part of 2022, we'll focus largely in facilitating a smooth transition and enhancing the future growth trajectory of this significant investment.

Speaker 3: Moving to slide four, on the heels of the second most active September in the 14-year history of the REMAX National Housing Report, October home sales in 51 surveyed metros dropped 6.4% from September , almost double the typical seasonal decline. In many markets, home sales are getting pinched by near record prices and record low inventory.

Moving to slide four.

On the heels of the second most active September and the 14 year history of the Remax National Housing report October home sales and 51 survey Metros dropped six 4% from September almost double the typical seasonal decline in.

In many markets home sales are getting pinched by near record prices and record low inventory we're.

Speaker 3: We're seeing the effects of a long sustained run up in prices and month over month home sales and the days of immediate sales, multiple offers and bidding orders on virtually every property are beginning to wane.

We're seeing the effects of a long sustained run up in prices and month over month home sales and the days of immediate sales multiple offers and bidding wars on virtually every property are beginning to wane.

Speaker 3: This cool-down is somewhat overdue, and the October dip in sales could be a step toward a more balanced housing market. Overall, the market remains relatively robust, even as it trends towards more seasonal norms.

This cool down is somewhat overdue in the October different sales could be a step toward a more balanced housing market overall, the market remains relatively robust even as it trends towards more seasonal norms.

Speaker 3: Sales are still happening quickly, but at a slightly slower pace than earlier this year. October's average days on market of 27 was one day more than September , and reflected sales that were 11 days faster on average than in October 2020.

Sales are still happening quickly, but at a slightly slower pace than earlier. This year October average days on market of 27% was one day more than September and reflected sales that were 11 days faster on average than in October 2020.

Speaker 3: Inventory remains an issue. The 1.3-month supply of inventory in October was down from September's 1.5-month supply, and having more homes on the market would be welcome news. Homebuilders are trying to fill the gap, especially with multifamily home construction, but many of them are being delayed by shortages in labor and materials as well as general supply chain challenges.

Inventory remains an issue the one three months supply of inventory in October was down from September one five months supply and having more homes on the market would be welcome news.

Builders are trying to fill the gap, especially with multifamily home construction, but many of them are being delayed by shortages in labor and materials as well as general supply chain challenges.

Speaker 3: Homebuyers may see some relief in price appreciation during the coming months, even as sales levels stay high.

Homebuyers may see some relief in price appreciation during the coming months, even as sales levels stay high.

Sellers remain in a very strong position, but with price stabilization in the continuation of competitive interest rates I should find the coming months to be more advantageous than any time earlier this year.

Speaker 3: Sellers remain in a very strong position, but with price stabilization and the continuation of competitive interest rates, buyers should find the coming months to be more advantageous than any time earlier this year. In any event, 2021 has been a strong year for sales and should continue to be. The value of a skilled full-time real estate professional will be even more evident as the market rebalances a bit. With that, I'll turn it over to Nick for some greater detail on retail.

In any event 2021 has been a strong year for sales and should continue to beat the.

The value of our skilled full time real estate professional will be even more evident as the market rebalance is a bit with that I'll turn it over to Nick for some greater detail on Remax.

Speaker 3: Thanks, Adam. Good morning, everyone. Looking at slide five, overall agent count increased nearly 5% year over year to a new record of almost 141,000 agents. We've added over 6,000 agents worldwide since September 2020, highlighted by exceptional growth in Canada. In fact, our combined U.S. agent count is approaching levels we haven't seen in over a dozen years, despite the competitive marketplace and the unusual circumstances of the past year.

Thanks, Adam Good morning, everyone looking at slide five overall agent count increased nearly 5% year over year to a new record of almost 141000 agents. We've added over 6000 agents worldwide. Since September 2020 highlighted by exceptional growth in Canada. In fact, our combined U S agent count is approaching levels, we haven't seen in over it.

And years, despite the competitive marketplace and the unusual circumstances of the past year USD.

U S agent count held steady year over year, highlighting the resiliency and attractiveness of our brand because of their productivity remax agents tend to be recruiting aggressively and consistently especially by brands with an agent the agent recruiting model.

<unk> agents stay with our network, however, because they value its many benefits and advantages our focus continues to be on providing the best services. So that our agents can focus on increasing their productivity and helping consumers close more sales the industry is filled with discount options and complex compensation structures, but we continue to build our market presence by <unk>.

Speaker 3: The industry is filled with discount options and complex compensation structures, but we continue to build our market presence by appealing to full-time professionals who would rather work with buyers and sellers than recruit other agents. We believe it's a sound strategy that will spur new growth, productive growth over time.

Two full time professionals, who would rather work with buyers and sellers and recruit other agents. We believe its a sound strategy that will spur new growth productive growth overtime.

Speaker 3: It's happening in Canada right now, where our growth is accelerating. We've added over 2,000 agents, a significant 10% gain year over year. In Canada, where being a real estate agent is widely viewed as a full-time profession, REMAX is the market leader and the best choice for those who want to work among other strong, like-minded professionals.

It's happening in Canada, right now where our growth is accelerating we've added over 2000 agents a significant 10% gain year over year.

In Canada, we're being a real estate agent is widely viewed as a full time profession remax is the market leader and the best choice for those who want to work among other strong likeminded professionals.

Speaker 3: Adding the Canadian portion associated with the Integra transaction positions us for even greater things across the country, bringing the REMAX Ontario Atlantic Canada region and our company-owned Western Canada region together as a unified force is enabling us to scale our efforts in technology, marketing, and other services. The alignment will create a more seamless experience for franchisees, agents, and even consumers.

Adding the Canadian portion associated with the Integra transaction positions us for even greater things across the country, bringing the Remax, Ontario Atlantic Canada region.

And our company owned Western Canada region together as a unified force is enabling us to scale our efforts in technology marketing and other services. The alignment will create a more seamless experience for franchisees agents and even consumers and shifting 12000 Canadian agents from an independent region to a company owned will open.

Speaker 3: and shifting 12,000 Canadian agents from an independent region to a company owned will open up even more opportunities in the future.

And even more opportunities in the future.

Speaker 3: When you factor in our long-time market leadership in Quebec, the prospects across all of Canada become even more exciting. It is also one of the many reasons we continue to invest in our Canada operation.

When you factor in our long time market leadership in Quebec, the prospects across all of Canada to become even more exciting. It is also one of the many reasons, we continue to invest in our Canada operations.

Speaker 3: To this point, we officially announced earlier this month that Booz was launched in Canada. The introduction of our proprietary technology suite greatly enhances our value proposition and further differentiates us from the competition.

This point, we officially announced earlier this month the Booz was launched in Canada. The introduction of our proprietary technology suite greatly enhances our value proposition and further differentiates us from the competition.

Speaker 3: Moving to the global arena, our international agent count increased over 8.5% to more than 55,000 agents. Recall when that was surpassed 50,000 agents outside the U.S. and Canada in the summer of 2020. So, increasing more than 10% in a little over a year during a pandemic has been impressive growth. And, despite already being in over 110 countries and territories, we continue to move into new geographies due to the strong desire to be affiliated with the REnex brand.

Shifting to the global Arena, our international agent Count increased over eight 5% to more than 55000 agents recall when that was surpassed 50000 agents outside the U S and Canada in the summer of 2020, so increasing more than 10% and a little over a year. During a pandemic has been impressive growth and despite already being <unk>.

Over 110 countries and territories, we continue to move into new geographies due to the strong desire to be affiliated with the Remax brand.

Speaker 3: During the past 90 days, we've announced the sales of master franchise rights into three additional countries, Pakistan, Guyana, and Uzbekistan.

During the past 90 days, we've announced the sales of Master franchise rights into three additional countries Pakistan.

<unk> and Uzbekistan.

Speaker 3: Very exciting news and with these sales come additional opportunities to grow.

Very exciting news and with these sales come additional opportunities to grow.

Speaker 3: Turning to slide six, we continue to invest in our business and enhance our overall value proposition. We recently announced a complete reinvention of our RE-MAX University platform, an exclusive to RE-MAX learning hub designed to help agents level up their professional expertise.

Turning to slide six we continue to invest in our business and enhance our overall value proposition, we recently announced a complete reinvention of our Remax University platform and exclusive to Remax learning hub designed to help agents level up their professional expertise built.

Speaker 3: Built on intuitive new technology, Remax University puts agents in control of when, where, what, and how they learn. It's a modern, mobile-based user experience, and it will help our affiliates develop new skills. And that's a good thing, because we believe the more you learn, the more you earn. In fact, Remax has found that agents who engaged with Remax University, on average, closed more transactions and earned more commissions.

Bill Com intuitive new technology, Remax University puts agents in control of when where what and how they line.

It's a modern mobile based user experience and it will help our affiliates develop new skills and Thats a good point because we believe the more you learn the more you Arne and factory Max has found that agents, who engaged with <unk> University on average close more transactions and earned more commission.

Speaker 3: Having been a leader for decades, RE-MAX understands that markets change over time. When that shift comes and education becomes a more immediate priority, the new RE-MAX University will already be in place. It's another example of us working ahead of the curve and being prepared for whatever the future may bring. With that, I will turn it over to Ward.

Having been a leader for decades, Remax understands that market has changed over time.

That shift comes and education becomes a more immediate priority the new Remax University will already be in place. It's another example of US working ahead of the curve and being prepared for whatever the future may bring with that I will turn it over to ward.

Yeah.

Thanks, Nick looking at slide seven the last 90 days have been a very exciting time for our mortgage segment.

Speaker 4: Thanks, Nick. Looking at slide 7, the last 90 days have been a very exciting time for our mortgage segment. On the model side, we continue to sell franchises at a near-record rate through September 30, and we expect to sell 60 or more franchises this year. Lifetime to date, we have now sold almost 300 franchises. We expect to eclipse that significant milestone before year end.

On the motto side, we continued to sell franchises at or near record rate through September 30, and we expect to sell 60 or more franchises. This year.

Lifetime to date, we have now sold almost 300 franchises, we expect to eclipse that significant milestone before year end.

Speaker 4: Notably, office openings continue to accelerate as expected. We are seeing the echo effect of last year's inflection in franchise sales and are experiencing a similar uptick in office openings, which grew more than 30% year-over-year in Q3. In fact, year-to-date, we have opened more offices than we have sold, a first in our history.

Notably office openings continuing to accelerate as expected we are seeing the echo effect of last year's inflection in franchise sales and are experiencing a similar uptick in office openings, which grew more than 30% year over year in Q3.

In fact year to date, we have opened more offices than we have sold a first in our history.

Speaker 4: We now have over 175 open model franchises in almost 40 states and we're aiming to have 200 open offices by year end.

We now have over 175 open motto franchises and almost 40 states and we are aiming to have 200 open offices by year end.

Speaker 4: A big area of organizational focus for our model mortgage business this year has been the continued development of WEMLO. We acquired WEMLO last year to solve one of our model franchisees' primary paying

A big area of organizational focus for our motto mortgage business. This year has been the continued development of <unk>, we acquired <unk> last year to solve one of our motto franchisees primary pinpoints, finding steady dependable and economic loan processing services with the addition of <unk> motto offices now have.

Speaker 4: finding steady, dependable, and economic loan processing services.

Speaker 4: With the addition of WEMLO, Motto offices now have access to an operationally ingrained, third-party loan processing team, which is held to the same high standards of customer service that have come to define the Motto Mortgage brand.

Access to an operationally ingrained third party loan processing team, which is held to the same high standards of customer service that have come to define the motto mortgage brand.

Speaker 4: The exciting news we announced last month was the introduction of Wemlo's Loan Brokering System, or LBS. We believe our LBS is a revolutionary technology, a software suite purpose-built to address the exacting needs of the professional loan originator operating in the mortgage broker channel. And importantly, the streamlined Wemlo LBS doesn't require brokers to navigate through relevant system tasks designed for other landowners.

Exciting news, we announced last month was the introduction of limos loan brokerage system or LDS. We believe our lbs is a revolutionary technology a software suite purpose built to address the exacting needs of the professional loan originator operating in the mortgage broker channel and importantly, the streamlined.

Lbs doesn't require brokers to navigate through irrelevant system task designed for other landing channels.

We have spent the past five years gathering real world experiences from hundreds of motto loan originators. So we could understand precisely where traditional origination systems fall short for the broker channel and developing the wingo lbs, we had been obsessed about how to better leverage our mortgage brokers, most valuable resource time or two.

Speaker 4: We have spent the past five years gathering real-world experiences from hundreds of model loan originators so we could understand precisely where traditional origination systems fall short for the broker channel. In developing the WeMo LBS, we have been assessed about how to better leverage a mortgage broker's most valuable resource, time.

Speaker 4: Our team knows that loan originators often spend precious time navigating through unneeded components in antiquated loan systems.

<unk> knows that loan originators, often spend precious time navigating through unneeded components, an antiquated loan system.

Speaker 4: That lost time could be better spent developing value-add solutions for our franchisees and high-quality service to their consumers.

Last time could be better spent developing value add solutions for our franchisees and high quality service to their consumers.

Speaker 4: Our module affiliates deserve the efficiencies of a purpose-built platform and the broker channel is more than ready for modern technology that simplifies their unique workflow.

Our motto affiliates deserve the efficiencies of a purpose built platform and the broker channel is more than ready for modern technology that simplifies their unique workflow. The wingo Lvs will officially launch the mortgage brokerage industry in January 2022, but motto offices will be granted first access and begin onboarding this year.

Speaker 4: The WEMO LBS will officially launch to the mortgage brokerage industry in January 2022, but model offices will be granted first access and begin onboarding this year.

Speaker 4: Model affiliates are receiving the LBS platform at no additional fee, as well as initial discounts on the integrated WEMLO loan processing offerings and exclusive LBS product features. With that, I'd like to turn

Motto affiliates are receiving the lbs platform at no additional fee as well as initial discounts on the integrated wingo loan processing offerings and exclusive lbs product features with that I'd like to turn the call over to Kerry.

Speaker 5: Thank you, Ward. Good morning, everyone. Moving to slide 8, total revenue grew 28% to a record $91 million. Excluding the marketing funds, revenue was almost $68 million. Acquisitions increased overall revenue by 18%, primarily due to incremental revenue from the REMAX Integra North American Region's acquisition. However, we are also seeing year-over-year growth for both Weenlo and Gadbury. SX impacted revenue by a negligible amount.

Thank you Lauren good morning, everyone moving to slide eight total revenue grew 28% to a record $91 million, excluding the marketing funnel.

Revenue was almost $68 million acquisitions increased overall revenue by 18% primarily due to incremental revenue from the Remax Integra North American Regent acquisition. However, we are also seeing year over year growth for both <unk> and Gadberry.

FX impacted revenue by a negligible amount.

Speaker 5: Notably, our organic revenue growth was up almost seven percent. Even after setting aside broker fees, this is the second quarter in a row we generated mid-single-digit organic growth. Many organic growth drivers contributed to our strong top-line performance during Q3, including agent count growth, pricing, motto, and more targeted use of agent recruiting incentives, to name the most notable.

Notably our organic revenue growth was up almost 7% even after setting aside broker fees. This is the second quarter in a row, we generated mid single digit organic growth.

Organic growth drivers contributed to our strong topline performance during Q3, including agent count growth pricing motto and more targeted use of agent recruiting invented the name. The most notable one if you exclude the legacy runoff our organic growth improved by almost another 60 basis points.

Speaker 5: If you exclude the booze legacy runoff, organic growth improves by almost another 60 days.

Speaker 5: We believe we'll see continued mid-single-digit organic growth for the foreseeable future, which should drive further margin expansion.

We believe we will see continued mid single digit organic growth for the foreseeable future, which should drive further margin expansion.

Speaker 5: Looking at slide 9, selling, operating, and administrative expenses were $51.1 million in the third quarter of 2021, up significantly over the prior year. The year-over-year comparisons for SONA are not particularly meaningful due to one-time items in 2020 related to the pandemic and our reduced spend in Q3 of last year. Additionally, our 2021 third quarter SONA included expenses related to the acquisition of REMAX Integra's North American operation.

Looking at slide nine selling operating and administrative expenses were $51 1 million in the third quarter of 2021.

Significantly over the prior year.

A year over year comparisons for <unk> are not particularly meaningful due to onetime items in 2020 related to the pandemic and our reduced spend in Q3 of last year. Additionally, our 2021 third quarter included expenses related to the acquisition of Remax Integra North American operation.

Speaker 5: While our staff travel is picking up in response to the importance of in-person events and training that our customers are now eager to participate in, our spending levels remain well behind our pre-pandemic levels in 2019.

All our staff travel is picking up in response to the importance of in person events and training that our customers are now eager to participate in our spending levels remain well behind our pre pandemic levels in 2019.

Speaker 5: In terms of our newer businesses, we continue to see margins from our recent acquisitions trending in the right direction.

In terms of our newer businesses, we continue to see margins from our recent acquisition was trending in the right direction.

Speaker 5: While Gadbury has already started to generate a monthly profit ahead of our expectations, First and WEMLO are ramping a bit slower. We have plans in place to boost each offering's revenue in 2022. Motto continues to perform well, bolstered by the accelerated office openings. Along with WEMLO, we expect our mortgage business to generate a profit in 2022 and thereafter.

Gadberry has already started to generate a monthly profit ahead of our expectation first and Meanwhile are ramping a bit slower we have plans in place to do each offering revenue in 2022.

Motto continues to perform well bolstered by the accelerated office opening.

Meanwhile, we expect our mortgage business to generate a profit in 2022 and thereafter.

Speaker 5: Moving to slide 10, the company's fourth quarter and full year 2021 outlook assumes no further currency movements, acquisitions, or divestiture.

Moving to slide 10, the Companys fourth quarter and full year 2021 outlook assumes no further currency movements acquisitions or divestitures.

Speaker 5: For the fourth quarter of 2021, we expect agent count to increase 2.5 to 3.5% over fourth quarter 2020, revenue in a range of $86 million to $90 million, including revenue from the marketing funds in a range of $22 million to $24 million, and adjusted EBITDA in a range of $27.5 million to $30.5 million.

For the first quarter of 2021, we expect agent count to increase two five to three 5% over fourth quarter 2020 revenue in a range of 86 million to $90 million, including revenue from the marketing finance and a range of 22 million to $24 million and adjusted EBITDA in a range.

$27 5 million to 30 and half million.

Speaker 5: For the full year 2021, we're decreasing our agent count guidance due to slower-than-expected global growth, tightening our revenue range, and increasing our adjusted EBITDA guidance due to better-than-expected third-quarter results.

For the full year 2021, or decreasing our agent count guidance due to slower than expected global growth tightening our revenue range and increasing our adjusted EBITDA guidance due to better than expected third quarter results.

Speaker 5: We expect agent count to increase 2.5 to 3.5% over full year 2020, down from 5 to 6%.

We expect agent count to increase two five to three 5% over full year 2020 down from 5% to 6% revenue in a range of $326 5 million to $330 5 million, including revenue from the marketing funds in a range of 81 5 million to $83 5 million.

Speaker 5: revenue in a range of $326.5 million to $330.5 million, including revenue from the marketing funds in a range of $81.5 million to $83.5 million, change from $321 million to $336 million, and adjusted EBITDA in a range of $116 million to $119 million, up from $113 million to $118 million. Now I'll turn...

Changed from 321 million to $336 million and adjusted EBITDA in a range of 116 million to $119 million up from $113 million to $118 million now I'll turn it back to Adam.

Thanks, Gerry looking at Slide 11, we had a record third quarter in many respects. Our recent acquisition of Remax Integra is north American regions is off to a terrific start we're seeing our many investments really begin to pay off we are a more diversified business with plentiful growth opportunities.

Speaker 6: Thanks, Kerry. Looking at slide 11, we had a record third quarter in many respects. Our recent acquisition of Green Max Integras North American Regions is off to a terrific start. We're seeing our many investments really begin to pay off. We are a more diversified business with plentiful growth opportunities.

Speaker 6: We believe we have real momentum right now, and we're looking forward to finishing 2021 with strength and having set a strong foundation to build upon for 2022. With that, Operator, let's open it up for questions.

We believe we have real momentum right now and we're looking forward to finishing 2021 with strength and having set a strong foundation to build upon for 2022 with that operator, let's open it up for questions.

Speaker 1: Certainly. If you would like to ask a question, please press star followed by the number one on your telephone keypad. To withdraw your question, please press star one again. We'll pause for just a moment to compile the Q&A roster.

Certainly if you'd like to ask a question. Please press star followed by the number one on your telephone keypad.

Your question. Please press Star one again, we'll pause for just a moment to compile the Q&A roster.

Speaker 1: Your first question comes from Richard Hill from Morgan Stanley . Please go ahead. Your line is open.

Your first question comes from Richard Hill from Morgan Stanley. Please go ahead. Your line is open.

Speaker 7: Hey, good morning, guys. Thanks for the prepared remarks and the additional caller. I did want to talk maybe a little bit more about your revenue per agent. What does that look like? Has that decreased? How do you think about that relative to where home valuations are going and maybe some of the trends that you're seeing in your agent count?

Hey, good morning, guys. Thanks for the prepared remarks.

The additional color I just wanted to talk maybe a little bit more about your revenue per agent.

What does that look like has that decreased how do you think about that relative to where home valuations are going and maybe some of the trends that youre seeing in your agent count.

Speaker 5: Sure. Good morning, Rich. Great question. You know, if we think about revenue per agent, I think it really highlights the differences in the RE-MAX model, you know, with over 60% of our revenue being recurring in nature. That revenue per agent, especially in our owned regions here in North America, has been pretty consistent, kind of in that $2,600 to $2,700 per agent.

Sure. Good morning, Rich Great question, if we think about revenue per ads and I think it really highlights the differences in the Remax model with over 60% of our revenue being recurring in nature that revenue per Asia, and especially in our owned regions here in North America has been pretty consistent kind of in that 26% to $2700.

<unk> per agent.

Speaker 5: Obviously with broker fee and home price appreciation moving upwards, that's continuing to increase our revenue per agent. But just the difference in our business model and the recurring fee nature really helps protect us in any kind of macro environment. And we've seen that pretty consistent with upward trajectory and contributions from broker fee as well as the continuing franchise fee increase we did earlier this year.

With broker fee and home price appreciation moving upwards that.

To increase our revenue per agent, but just the difference in our business model and the recurring fee nature really helps protect us in any kind of macro environment, and we've seen that pretty consistent with upward trajectory and contributions from broker fee as well as the continuing franchise fee increase we did earlier this year.

Speaker 7: Okay, great, guys. And then you made a pretty interesting comment. Hopefully, I'm not putting words in your mouth, but that you're keeping the most productive brokers. How do you guys measure that? And I'm not pushing back on it. I'd just like to maybe get a little bit more transparency on how you think through that.

Okay, Great guys and then you made a.

Pretty interesting comment.

Hopefully I'm not putting words in your mouth, but you are keeping the most productive brokers, how do you guys measure that and I'm not pushing back on it I would just like to maybe get a little bit more transparency on how you think through that.

Speaker 3: Yeah, thanks Rich. Hi, it's Nick. Good question on that. That's something that's actually been on our radar as we look across the system with a footprint as large as ours, we have a number of ways that we look at each and every franchisee to make sure that they're performing at the required levels. And so we have taken, as we do on a regular basis, an analysis of all of our franchisees

Yeah, Thanks, Rich hi, it's Nick.

Good question on that and Thats, something thats actually been on our radar as we look across the system with footprint as large as ours, we have a number of ways that we look at each and every franchisee to make sure that they are performing at the required levels and so we have taken as we do on a regular basis.

An analysis of all of our franchisees.

And we have to look at those that are underperforming and.

Unfortunately may not be part of the system and so we have had some terminations for underperformance that has.

And then part of just our regular course of business, but we've had a few of those recently in the third quarter.

Speaker 3: But we've had a few of those recently in the third quarter.

Speaker 7: Great. Thanks, guys. I'll jump back in the queue in the interest of time.

Great. Thanks, guys I'll jump back in the queue in the interest of time.

Speaker 1: Your next question comes from Ryan McKechnie from Zellman and Associates. Please go ahead, your line is open.

Your next question comes from Ryan Mckechnie from Zelman <unk> Associates. Please go ahead. Your line is open.

Speaker 8: Hey, good morning. Thanks for taking the question. So in terms of the

Hey, good morning, Thanks for taking the question.

So in terms of the.

Speaker 8: The acquisitions over the past few years, so G73 was when you called out in particular mentioning the quarterly profit.

The acquisitions over the past few years to <unk> 73 was when you called out in particular mentioning the quarterly profit.

Speaker 8: Was hoping maybe you can remind us on kind of the revenue model there or the economic model there

I was hoping maybe you can remind us on kind of the revenue model there are the economic model there.

And then also when we when we think about first it sounds like that one is still in investment mode, but but look as 2022, maybe that flips. So.

Speaker 8: Sounds like that one's still in investment mode, but the outlook is 2022, maybe that flips. So, curious if you can just, again, hit on the G73, kind of the economic model there, how we should think about that. And then for all of these ancillaries, I guess, is this flowing through, I believe, within the franchise sales and other? And there was some, you know, better...

So curious if you can just again hit on the 273 kind of the economic model. There. How we should think about that and then for all of these ancillary is I guess is is this flowing through I believe within the franchise sales and other and there was some.

<unk>.

Speaker 8: growth there than at least I was modeling. So is that a reflection of some of these?

Growth there than at least I was modeling so is that a reflection of some of these new businesses starting to to ramp up there on the revenue side.

Speaker 8: new businesses starting to ramp up there on the revenue side, and then I have a

And then I have a second question I'll come back to you. Thank you.

Sure. Good morning, Ryan It's karri. So great question. If we look at just the holistic investments that we've made in the business. It's been part of a broad effort over the last couple of years from a diversification perspective, and we're starting to see.

Speaker 5: Sure, good morning, Ryan, it's Keri. So great question, if we look at just the holistic investments that we've made in the business, it's been part of a broad effort over the last couple of years from a diversification perspective. And we're starting to see some momentum across all of the investments. So from a Gadbury perspective, it's more of a subscription-based revenue stream, just based on the products that are sold. It is running through franchise sales and other revenue. And so some of that performance was contributing to the overall top line. And I think that's what we're so excited about. You know, we said if we can get the top line going, given the strength of our franchise model, that would translate into profit. And so as we look ahead to 2022 and beyond, a little bit slower ramp in 21, but positioning ourselves well for future adoption across FIRST, WEMLO, and continued profitable growth on Gadbury in the future.

The momentum across across.

All of the investment so from from a Gadberry perspective, it's more of a subscription based revenue stream just based on the products that are sold it is running through franchise sales and other revenue.

Some of that performance was contributing to the overall top line and I think that's what we're so excited about we said if we can get the top line going given the strength of our franchise model that would translate into into profit and so as we look ahead to 2022 and beyond.

A little bit slower ramp in 'twenty, one, but positioning ourselves well for future adoption across first lien low and continued profitable growth on grad gadberry in the future.

Speaker 6: And I'll, it's Adam. Good morning. I'll, I'll add a little bit, you know, this is just really kind of the.

And al it's.

It's Adam good morning I'll.

I'll add a little bit.

This is just.

Really kind of the.

The results of what we've been talking about over the past couple of years of our efforts to ensure that we provide.

Speaker 6: The results of what we've been talking about over the past couple of years of our efforts to ensure that we provide

Speaker 6: you know, a deeper knowledge base and capability in our data and technology for our agents and our franchisees.

A deeper knowledge base and capability in our data and technology for our agents and our franchisees obviously, what the efforts are helping the consumer so much better so what youre starting to see what these results is what we've been saying Hey, we're going to see some results from this and we're seeing that occur now from.

Speaker 6: Obviously, with the efforts of helping the consumer so much better. So what you're starting to see with these results is what we've been saying, hey, we're going to see some results from this, and we're seeing that occur now from these different technology acquisitions and the integrations going on in the network, but also our lack of dependence.

From these different technology acquisitions, and the integrations going on in the network, but also our.

Our lack of dependence.

Speaker 6: Pretty data and technology independent now in the industry, and that's a good thing for our network and our system because it allows us to provide, you know, effort in the areas that we see the agents.

Pretty data and technology independent now in the industry and Thats a good thing for our network and our system because it allows us to provide.

Effort in the areas that we see the agents.

Speaker 6: you know, desiring better value out of that. So, we're pretty proud of the direction it's headed and, you know, anticipating continued progress in.

Desiring better value out of that so we're pretty proud of the direction, it's headed and.

Anticipating continued progress in these.

Speaker 8: Thanks, Adam. That's helpful. And then one follow-up question for Ward on the mortgage side. So with WEMLO and the LBS system, just to clarify your comments, so it sounds like the motto brokers will get either free or discounted access to that.

Thanks, Adam that's helpful.

And then one follow up question for ward on the mortgage side, so with wind load and the obs system.

Just to clarify your comments so it sounds like the the motto brokers will get.

Either free or discounted access to that so I guess my question is in terms of that obs system.

Speaker 8: So I guess my question is, in terms of that LBS system, should we think about that as an area of incremental revenue profit potential for, you know, REMACs and through its motto brokers? Or would the motto brokers effectively...

Is there should we think about that as an area of incremental revenue profit potential for.

Remax and through its motto brokers or with the motto brokers effectively quote unquote pay for that through their kind of franchise fees and then it sounds like you are suggesting the opportunity maybe at least revenue wise might be even greater outside of the.

Speaker 8: quote-unquote pay for that through their kind of franchise fees and then it sounds like you're suggesting the opportunity maybe at least revenue-wise might be even greater outside of the

Speaker 8: the MOTTO network of loan brokers or mortgage brokers that might want to use this product. Maybe just clarify there around the comments you made about the either free access or discounted access on the MOTTO side and kind of what the potential there is.

The motto network of loan brokers are our brokerage mortgage brokers that might.

Want to want to use this product. So maybe just clarify there around the comments you made about that either a free access or discounted access on the motto side and kind of what the potential areas. Thank you.

Yes, great question. So on the motto side that we used to provide early may encompass and we will be migrating all of our people off of that platform onto the wingo Lvs. Therefore, it will be no cost to our motto owners to be on that platform. Because there was no cost to be on the encompass platform Pryor. However, because they are in the platform now we believe it will.

Speaker 4: Yep, great question. So on the model side, we used to provide a compass and we will be all of our people off of that platform onto the LBS.

Speaker 4: Therefore, it will be no cost to our model owners to be on that platform because it was no cost to be on the encompass platform prior.

Speaker 4: However, you know, because they're in the platform now, we believe it will drive.

Drive the processing service of Nemo that side of the house.

Because now they will just be hit a button that says process now with remote so we believe thats going to start to move the needle on the Nemo processing, which you are right as of January we will rollout that we mow lvs to the mortgage broker channel as a software as a service. So we believe there is incremental upside there as we start to.

Speaker 8: hit a button that says process now with WEMLO. So we believe that's going to start to move the needle on the WEMLO processing. But you are right, as of January , we will roll out the WEMLO LBS to the mortgage broker channel as a software as a service. So we believe there's incremental upside there as we start to roll the program out and offer it to the industry. And we do believe that will be additional revenue that we can gain share on as we move forward. Got it. That makes sense. Thank you, Org.

Roll the program out and offered to the industry.

And we do believe that will be additional revenue that we can.

Gained share on as we move forward.

Speaker 8: Got it. That makes sense. Thank you, Org.

Got it that makes sense. Thank you ward.

Yes.

Your next question comes from Anthony Anthony Powell loan from J P. Morgan. Please go ahead. Your line is open.

Speaker 1: Your next question comes from Anthony Paolone from J.P. Morgan. Please go ahead. Your line is open.

Speaker 9: Great. Thank you. And good morning. My first question is with regards to the reduced age and count growth. Can you talk about, you know, where, what regions perhaps are driving that and also maybe what's changed or why more specifically the reduced outlook?

Great. Thank you and good morning.

My first question is with regards to the reduced agent count growth can you talk about.

Where.

What regions, perhaps are driving that and also maybe what's changed or why.

More specifically the reduced outlook.

Speaker 3: Absolutely. So coming into 21 and especially coming into the quarter, we had begun to see obviously the investments that we've made in the attention around just overall recruiting and have a lot of bright spots from around areas globally. Canada's doing terrific. We have states within the U.S. that are performing just as we had indicated early in the year that we expected to add hundreds of agents throughout the year. Something that we looked at that I mentioned on the earlier question.

Absolutely, so coming into 'twenty, one and especially coming into the quarter.

We had begun to see obviously the investments that we've made and the attention around just overall recruiting and have a lot of bright spots from around the areas globally candidates doing terrific. We have states within the U S that are performing just as we had indicated early in the year that we expected to add hundreds of agents throughout the year.

Something that we looked at that I mentioned on an earlier question that impacted us coming into Q3 is as we look around the U S. Specifically and we have three states, California, Indiana, and Ohio, or I'm, sorry, New Jersey that when we were looking at some some of the franchise.

Speaker 3: that impacted us coming into Q3 is as we look around the U.S. specifically, and we have three states, California, Indiana, and Ohio, or I'm sorry, New Jersey, that when we were looking at some of the franchisees in those areas, we had some significant underperformers that actually were terminated from our system in Q3, and that did somewhat interrupt that momentum that we had coming into Q3. So still looking at continuing on with the momentum of the gross ads in the top line, but we had some unexpected terminations coming into Q3 that we don't expect as much moving forward.

He is in those areas we had some.

Some significant underperformers that actually were.

Were terminated from our system in Q3 and that did somewhat interrupts that momentum that we had coming into Q3, so still looking at continuing on with the momentum of the gross adds in the top line.

But we had some unexpected terminations coming into Q3 that we don't expect as much moving forward.

Speaker 3: And then as far as global, that's one thing to mention.

And then as far as global that's one thing dimension.

Speaker 3: Unlike the U.S. and Canada, the one thing that we're seeing globally is the pandemic continues because of the severity of some of the lockdowns in specific countries completely hinder business growth. I mean, even as recent as yesterday, the news around Europe and the amount of restriction that's happening is just much more significant than what we're seeing here in North America. And we believe that that continues to affect what we had originally forecasted.

Unlike the U S and Canada, the one thing that we're seeing globally.

As the pandemic.

Continues because of the severity of some of the Lockdowns in specific countries completely hindered business growth I mean, even as risky as recent as yesterday, the news around Europe, and and the amount of restriction. That's happening is just much more significant than what we're seeing here in North America, and we believe that that continues to affect.

What we had originally forecasted.

Okay got it and then you had called out the strength in Canada, and the growth that you're achieving there can you talk about.

Speaker 9: Okay, got it. And then you'd called out the strength in Canada and in the growth that you're achieving there. Can you talk about or put some brackets around where you see your market share now, where you think that could go? Just trying to understand the runway you might have there still.

Or put some brackets around where you see your market share now where you think that could go just trying to understand the runway you might have there still.

Yes, I think that market share has always been a great contributor to our strength all across Canada, which we average.

Speaker 3: Yeah, I think that market share has always been a great contributor to our strength all across Canada, which, you know, we average approximately 30.

Proximately 30, plus percent all across Canada, and even in say, the Quebec region upwards of 40%, so very very strong market position throughout throughout the country and I think you couple that with a strong real estate market.

Speaker 9: And I think you couple that with a strong real estate market, it even enhances our ability to grow. And we see that across the U.S. as well. In the cities and the markets where we have the strongest amount of market share, we have the greatest strength in franchise sales, we have the greatest strength in agent count growth. And so just Canada as a whole, we believe market share is a major driver in helping us grow organically. Okay. And then just last one, if I might, for Kerry, can you maybe just help us with anything...

Even enhances our ability to grow and we see that across the U S. As well in the cities in the markets, where we have the strongest amount of market share. We have the greatest strength in franchise sales, we have the greatest strength in agent count growth and so just Canada as a whole we believe market share as a major driver.

In helping us grow organically.

Okay, and then just a last one if I might for Kerry.

Speaker 9: Okay, and then just last one, if I might, for Kerry, can you maybe just help us with anything we should keep in mind in normalizing SOA and also like non-cash comp on a go-forward basis? Because it looked like maybe those were kind of noisier in the quarter.

Can you maybe just help us with.

Any thing we should keep in mind and normalizing SOA and also like noncash comp on a go forward basis, because it sounds like or it looks like maybe those were kind of noise here in the quarter.

Speaker 5: Yeah, so there's a little bit of noise in the quarter with regards to some of the equity-based compensation. It was up a little bit due to some one-time charges for Integra on a prospective basis in Q4 and beyond. Looking to get back to kind of what we thought at the beginning of the year in terms of kind of a $7 million per quarter run rate. A couple of other things non-cash-wise related to amortization expense. So we are expecting some incremental amortization expense coming from the Integra acquisition quarterly run rate kind of in the $2 million to $3 million of incremental amortization expense as a result of.

Yes, so there's a little bit of noise in the quarter with regards to some of the equity based compensation. It was up a little bit due to some one time charges for integra on a prospective basis in Q4 and <unk>.

Beyond looking to get back to kind of what we thought at the beginning of the year in terms of kind of a $7 million per quarter run rate.

A couple of other things non cash why is related to amortization expense. So we are expecting some incremental amortization expense coming from the Integra acquisition quarterly run rate kind of in that $2 million to $3 million of incremental amortization expense as a result of <unk>.

Speaker 5: as a result of Integra.

As a result of Integra.

Speaker 9: Okay, and so that will be an adjusted EPS.

Okay, and so that will be and that will be an adjusted EPS hit.

Speaker 10: Hit door or not. Yeah, that won't affect that won't affect adjusted EPS. I'm sorry, I will or will not that.

Pit ore.

That one the fact that we wont affect adjusted EPS.

Im sorry, it will or will not.

For that.

Yes.

Okay got it thank you.

Speaker 1: As a reminder, to ask a question, please press star followed by the number one on your telephone keypad. Your next question comes from James Hawley from Stevens. Please go ahead. Your line is open.

As a reminder to ask a question. Please press star followed by the number one on your telephone keypad. Your next question comes from James Holly from Stephens. Please go ahead. Your line is open.

Speaker 11: Hey, good morning. Thanks for taking my question. So first here, I just in the earnings release, you cited that a revenue driver was fewer recruiting initiatives. Could you briefly shine some light on the initiatives that you may have dropped and then some that you also kept that are working well.

Hey, good morning, Thanks for taking my question.

So first here I just in the earnings release, you cited that a revenue driver was fewer recruiting initiatives could you briefly shine some light on the initiatives that you may have dropped and then some that you're also cap that are working well.

Sure. Good morning, so when we look at recruiting initiatives, it's really a holistic view across the value proposition and then other incentives that we might pull from a financial perspective, that's nothing new that we've done it's been a holistic view really over the last several years.

Speaker 5: Sure, good morning. So when we look at recruiting initiatives, it's really a holistic view across the value proposition and then other incentives that we might pull from a financial perspective. That's nothing new that we've done. It's been a holistic view, really, over the last several years. We had placed a little bit heavier focus on some of the financial incentives previously while we were really focusing on enhancing the value proposition. And really, as we've transitioned into 2021, really much more of a focus on delivery of the value proposition and less utilization of fee waivers. And so that's what you're seeing in terms of the year-over-year comp from a financial perspective.

<unk> had placed a little bit heavier.

On some of the financial incentives previously, while we were really focusing on enhancing the value proposition and really as we've transitioned into 2021 really much more of a focus on delivery of the value proposition and less utilization of fee waiver and so thats, what youre seeing in terms of the euro year over year comp from a.

Our first back to us.

Okay understood. Thanks, and then just one more quick here could you also share pre acquisition with Integra its agent count and how it's been trending across the U S and Canada relative to Remax owned.

Speaker 11: Okay, understood, thanks. And then just one more quick here. Could you also share pre-acquisition with Integra, its agent count and how it's been trending across the U.S. and Canada relative to REMAC's own?

Speaker 5: Yes, so as we look at the Integra regions holistically, they have been on the forefront of growth from an agent count perspective, so both the U.S. and Canada have been outsized growers in terms of comparisons against the rest of our operations. That's part of the reason why we were so excited about the opportunity. And as we noted on the scripted remarks, in the third quarter, the asset even performed better than our expectations. And so continuing to see that outsized performance, both in terms of agent count growth, as well as that leading to revenue and earnings contributions as well.

Yes, so as we look at as we look at the Integra regions Holistically. They have been on the forefront of growth from an agent count perspective, So both of the U S and Canada has been outsized growers in terms of comparisons against the rest of our operation. That's part of the reason why we are so excited about the opera.

Unity and as we noted on the scripted remarks in the third quarter, the asset even performed better than our expectation and so continuing to see that outsized performance. Both in terms of agent count growth as well as that leading to revenue and earnings contributions as well.

Speaker 11: All right, very helpful, thank you, appreciate it.

Alright very helpful. Thank you I appreciate it.

Speaker 1: We have no further questions in queue. I'd like to turn the call back over to Andy Schultz for any closing remarks.

We have no further questions in queue I'd like to turn the call back over to Andy Schulz for any closing remarks.

Speaker 2: Thank you, operator, and thanks to everyone joining us on the call today. Have a great holiday week for those in the U.S. This concludes the call.

Thank you operator, and thanks to everyone joining us on the call today have a great holiday week for those in the U S. This concludes the call.

Speaker 1: This concludes today's conference call. Thank you for your participation. You may now disconnect.

This concludes today's conference call. Thank you for your participation you may now disconnect.

Speaker 12: Please wait, the conference will begin shortly. Thank you for watching.

Please wait the conference will begin shortly.

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