Q1 2022 Ritchie Bros Auctioneers Inc Earnings Call
Okay.
Good morning, My name is Chris and that'll be a conference operator today.
At this time I would like to welcome everyone to the Ritchie brothers Auctioneers first quarter conference call.
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I'll now turn the call over to Mr. Sameer Rethought, Vice President of Investor Relations and market intelligence to open the conference call.
Mr. <unk> you may begin your conference.
Hello, and good morning, and thank you for joining us on today's call to discuss our first quarter 2022 result.
Joining me today are Ann <unk>, our Chief Executive Officer, Sir and.
Sharon Driscoll, our Chief Financial Officer. The following discussion will include forward looking statements are not a statement of fact, including projections of future performance are considered forward looking involves risks and uncertainties the risks and uncertainties that could cause our actual operating results to differ significantly from our forward looking.
With our detailed in our SEC and Canadian.
Securities filings available on our Investor Relations website at Investor about Ritchie Bros. Dot com as well as Edgar and SEDAR.
For the identification of discussion of non-GAAP financial measures the most directly comparable GAAP financial measures.
Reconciliation between the two tier presentation slides earnings release.
Form 10-K , all available on our website I would now like to introduce <unk>.
Ann.
Thank you Samir and good morning to everyone joining our call today.
We drove solid results in the first quarter with 13% GTD growth, 19% service revenue growth and 54% growth in non-GAAP adjusted operating income.
As the unprecedented supply environment continues to drive equipment constraints.
These results are a testament to the entire Ritchie brothers team coming together to serve our customers around the globe.
And I see this quarter as early signs of our growth initiatives beginning to bear fruit.
Our omnichannel platform is delivering strong outcomes for our customers with bids per lot and used equipment pricing remaining very strong in the first quarter.
We are excited to welcome customers back to our flagship Orlando event, which was a huge success.
It was wonderful to celebrate with our customers and continue to drive great results for them.
We are fundamentally changing these types of events to focus more on in person interactions building even stronger relationships.
And creating an environment, where our customers can engage with our entire ecosystem helping.
Helping them discover the new Ritchie brothers and the large array of value added services, which can strengthen their business outcomes.
Our transformational journey continues and I look forward to what we learned together with our customers and how we evolve these events in 2022.
Now moving to euro auction.
I was very disappointed by the decision taken by the CMA.
To refer the proposed acquisition tool Phase II review.
Actually disagree with their very narrow definition of our collective market and resulting Butte.
While we believe the proposed acquisition would have accelerated our strategy. We remain committed to forging ahead in our transformational journey.
To becoming the trusted global marketplace for insight services and transaction solutions.
That said the transaction will automatically terminate on June 28 2022.
We redeemed all of the deal contingent notes on May four that were held in escrow at park.
We will continue to execute on growth both through organic investments and key acquisitions.
To accelerate our pace in achieving our transformation.
Our vision is clear and we want to give all of you the transparency on our journey.
On a quarterly basis, there is considerable amount of noise, especially in this environment, which is why we want to share our learnings as we go. So you all have the confidence that our strategy is working.
To that end, we are hosting an investor event next week on May 18th in Fort worth.
I hope all of you have a chance to listen to the webcast or if you are interested in attending in person and haven't already RSVP. Please contact from here.
We wanted to give everyone a more detailed view on the acquisitions we have made.
Showcase their technologies and how the pieces fit with our marketplace vision.
We will also have time to go into learnings from our accelerate growth initiatives such as the local yard strategy and sales coverage model it will be a great event.
Hope all of you take the time to listen to our story.
Moving to our inventory management system, we continue to make strong progress and in the first quarter. We added more organizations to the system then all last year combined.
With 103% sequential growth.
The Kpis, we continue to focus on is the number of organizations.
So as we build out our marketplace functionality, we are able to have scale quickly through deeper and stronger relationships with our customers.
After Sharon discusses our financials I will talk about our outlook and then we will move to Q&A and now over to Sharon.
Thank you and let me add my welcome to everyone on this call.
In the first quarter CTV increased 13% with broad strength across all regions.
We continue to see very strong contribution from our regional sales teams.
What offset by acute supply challenges in our strategic accounts group.
Recall that our Sag team services, the large fleet owners.
These customers are the most impacted by new and used equipment title.
We continue to see robust increases in mix adjusted prices of equipment offset by lower lock volumes and unfavorable mix.
We are pleased with the first quarter and see this as a very strong result, given Oems are still facing challenges with production and delivery lead times and overall supply of used equipment continues to be constrained.
Both total reported revenue and service revenue increased 19% compared to last year.
On an organic basis, excluding the impact from smart equipped.
Total service revenue increased approximately 17%.
Total service revenue continues to exceed total GTD growth in line with our evergreen model.
Our other services segment continues to put up robust growth as well, increasing 29% in the quarter and up approximately 15% on an organic basis, excluding Martin a quick revenue.
We continue to see strength in Ritchie brothers financial services growing 71% in the quarter.
This growth was partially offset by lower ancillary revenues of logistics with furbished mentioned repair.
Due to lower unit volume and overall mix of equipment.
Our non-GAAP adjusted operating income increased 54% on strong revenue performance.
With flow through to earnings partially offset by higher SG&A costs.
It is also important to note that the sale of our bolt in yard was completed this quarter and we posted a pre tax gain on this transaction of $169 million.
This gain in combination with our very strong operational performance.
<unk>.
<unk> reported diluted earnings per share number generating the highest quarterly earnings results in the company's history.
Turning to auctions and marketplaces and in service revenue increased 17% and our take rates or A&M service revenue as a percentage of total GTD came in at a robust 13, 9% for the quarter.
Of note our Canadian GTD saw strong growth in part driven by a healthy contribution within our agriculture sector and are on the farm auction events.
As we have noted in the past inventory sales tend to be lumpy and driven by Keith signer preferences.
And in the first quarter inventory sales increased 19% with strength in the U S, partially offset by lower volumes in Canada.
Inventory returns remained strong at 11, 7%.
Our sales teams are doing a great job finding equipment in the tough equipment supply environment and overall, we are pleased with our revenue rate performance as both profit on inventory sales and service revenues improved versus prior year.
Cost of services, plus SG&A was up 9%.
With total SG&A, increasing 11% compared to last year.
Note that cost of services less the incremental contribution of smart equipped would have been roughly flat year on year.
Total SG&A increased about 11%. However, this includes $5 4 million in share based payments.
$2 3 million and nonrecurring advisory legal and restructuring costs.
Once you look at SG&A, excluding these highlighted items, our core SG&A increased about 8%.
This increase was primarily driven by investments to fuel our accelerate growth initiatives, such as our new sales coverage model and our new local yard strategy.
As well as our partnership with that work.
Advance our modern architecture initiatives as we continue our journey to transform to a marketplace.
We also saw cost pick up in travel expenses as the team get back on the road.
We remain very diligent on costs, and we are making prudent investments that unlock the long term potential of our strategic vision.
We will continue to invest for organic growth build out our technology architecture, which underpins our marketplace strategy and highlight that we are not immune from current inflationary pressures.
As such we expect our SG&A in the second quarter of 2022 X share based payments onetime nonrecurring charges to be between $128 million to $133 million.
Our cash flow remains very robust.
12 trailing months operating free cash flow of $446 million.
Which is 193% of our non-GAAP adjusted net income delivering well above our stated evergreen model targets.
At the end of the quarter, our adjusted net debt to trailing 12 month non-GAAP adjusted EBITDA reduced to 0.5 times.
As we used proceeds received from the Bolton transactions to repay outstanding draws on our revolving credit facility.
And subsequent to quarter end on May four we redeemed at par our deal contingent note associated with the euro auctions transaction with accrued interest to that date.
For modeling purposes, we currently project interest expense of $18 million in the second quarter with a run rate of approximately 12 million starting in the third quarter of 2022 based on currently forecasted organic operating needs.
Overall, a very good quarter across all financial dimensions, and with that I will hand, it back over to Ann.
Thank you Sharon.
Now turning to our current trends and outlook, there's no change in our view here.
The environment remains very tight for equipment for all the supply chain reasons, which continue to persist.
That said, we see this environment as a point in time and considerate outside of our control.
Utilization levels are high.
And equipment is being used and continues to age.
This pent up supply will certainly need disposition services in the future.
Until that time, we are focused on growth in todays constrained environment.
By focusing on what we can control.
With our teams, providing the very best Omnichannel solutions for our customers.
Continuing to test learn and invest in growth initiatives.
And executing on our vision to becoming the global trusted marketplace for insight services and transaction solutions.
And with that operator, please open the line for questions.
Thank you ladies and gentlemen, we will now begin the question and answer session should you have a question. Please press star followed by one on your Touchtone phone if.
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Your first question comes from Gary <unk> Barrington Research Gary. Please go ahead.
Good morning, Hey.
And you.
You mentioned that nothing has really changed out there with the inventory situation.
With the.
New and used equipment coming through the channels.
Hi, Gary Yeah. So we're seeing a similar tightness. So I just wanted to make sure we peel the onion when I say nothing is unchanged I mean kind of the general supply environment out there it's still tight.
And.
No.
Not a very clear end in sight, even though we obviously know there will be an end at some point when the supply chain that you thought that will start getting back to the.
The initiatives our teams are taking on.
Both on the growth initiatives side the way, we're executing in order to really make the most of the environment as it is and you saw that in our financials.
Right. So were you a little bit surprised that the growth of <unk> in the quarter. I mean, there was some some shifting of an auction from Q.
To the Q1 in Nova Scotia, I'm not sure how big that auction normally is and then you had a new site that came up I mean, that's just really indicative of strong market share gains almost I'm reading it wrong.
You are reading it right, Gary So I would say maybe surprises not the word I think the trajectory that we've been on if you guys take a step.
Is up into the right unquestionably.
Some quarters that shows up much stronger some quarters like Q4, a little bit less but still up into the right I think the notable trends, though if you look over time exactly as you say signify just a tremendous performance by the team in this environment and again, we view that largely out of our control.
Nice thing is that we're putting all of the pieces in place they are already bearing fruit in this environment. So you can extrapolate that when the environment turns the local yard the feet on the street all of the investments, we're making youre seeing them in the SG&A are bearing fruit today and will bear that much more fruit as the environment turns.
Thank you.
Thank you, ladies and gentlemen, as a reminder, should you have a question. Please press star one on your Touchtone phone. Your next question comes from Kevin Condon Baird. Kevin. Please go ahead.
Hi, Good morning, Thanks for taking my question I wanted to ask I think the filing mentioned some higher by fee rates implemented in 2021 and early in 2022.
We saw some impact from that maybe when we looked at the strong service revenue relative to G TV growth.
Can that metric hold or potentially I guess increase.
As those fees are fully baked in in Q2 and beyond.
Hi, Kevin It's Dan.
I want to make sure that I'm understanding your question there was in SG&A.
Impact on kind of advisers to ask when you think about M&A and all of the things we've been through and then there is our service revenue.
Yes bye bye.
Insights yes. Please.
Yes, I think the filing and just mentioned that you raised.
Our buyer fees for your for your services.
Which maybe benefited service revenue relative to GTT.
I want to say service revenue is <unk>.
Service revenue as a percentage of <unk> was 17% in the quarter.
Is that correct.
That is correct, yes, okay got it so I understand yet so when you think about when we perform our services I'll start and then I'll turn it over to Sharon.
We charge, how we we're a marketplace right so largely we charge fees for insight services.
Financial services, and then obviously our transaction solution services. When we think about that fee structure, we're always cognizant of the competitive landscape and we've talked about pricing before on these calls that with something historically the company.
Really didn't do much of that now we're really looking at the competitive market and understanding kind of the services. We provide these would be what what.
The market is charging for those services number one number two there is a nuance of the fact that we have pricing tiers and Sharon has spoke about this before and as the equipment prices higher we have to adjust peers. It shows us pricing, but we adjust tiers to make sure that we actually are making less money for them.
Same services, we provide so theres kind of a nuance of that so there's really two sides of the way that we look at pricing ensuring that at that our peers are staying as they are intending to be as well as kind of a competitive marketplace position of that so in fact, we review it on a regular basis.
With pricing doing what it's doing more than.
More than once a year to ensure that we're competitive both on and on down.
Making sure that we're keeping pace with the market.
Darren anything to add.
I think the only this is something that we do look at it on a regular basis and I think the only impact this year, that's a bit different than prior year with prior year. The increase was effective kind of in the March timeframe and this year the.
<unk> changed effective January one.
So that's why you end up with a bit of a double impact of the growth from the prior year fee change as well as the current year fees, but to Echo Ann's point. This is really.
Just to reflect the service and value that we are driving particularly for the buyers.
Okay that helps a lot would be the timing.
Right there. Thank you.
Could I ask one quick follow up on a few weeks ago, you had a press release announcing that our European equipment financing permits selected.
Your asset solution season, its asset valuation.
Wanted to ask if that was one of the larger wins for our best So far if there are other examples we could point to.
This serves as potentially a proof of concept.
Or just any more detail on what that agreement would look like in terms of the services provided or how you monetize it.
Yes, Kevin So let me start and then I'm going to pass it over to Matt <unk>, Our Chief marketing Officer, we were so proud.
That again, when you start seeing the green shoots whether it.
The feet on the Street initiative, whether it's the local yards.
As we've been talking about kind of our insight services piece of our offering.
We are very very proud of that that is starting to take hold as well so with that Matt do you want to shed some light on it.
Sure. Yes this was a.
As Ann mentioned insights are a key part.
Our total offering and this was this was primarily a data deal.
With that European Bank, many of the banks over there use our data.
To assess the quality of their portfolios.
There are some European regulations related to what happened in 2008.
So it's kind of the way to think about it as a tip of the spear is that hey, if we're able to go in and offer. Our data. Then we also are able to go in and provide other services on top of that based on our technology, such that if and when in the future they need to dispose of assets. They are on the platform is ready to go.
And it just becomes.
Suffice it to say a click of a button and then some of those assets can flow into our transactional domains, but this particular deal was using the insights piece.
Our best platform to build that initial relationship with the bank.
Okay.
Great. Thanks for the color there. Thank you.
Thank you, ladies and gentlemen, as a reminder, should you have a question. Please press star one on your Touchtone phone.
Your next question comes from Michael Do May Scotiabank, Michael. Please go ahead.
Hey, good morning, everybody.
Great quarter, obviously.
To go back to the fee increase I'm, just wondering how to think about it.
Whether that's you essentially moving on what we are seeing a stronger buyer demand here.
And thinking forward at some point a supply essentially catches up to demand I'm wondering how we should think about the sustainability of the fee increase and maybe other.
The thinking as to maybe the.
Our commission increases maybe supply catches up versus demand.
Yes, Michael Hyatt San Okay, Let me, let me shed light and this is why I think.
The way to think about this conversation is less about season fee increases and more about I will just take us back to the evergreen model commitment we made.
To ourselves so our investors to all of you and how that actually comes to be.
So our we rolled out the evergreen model, which was December 2020, and when you kind of highlighted the transformation to the marketplace. We made the following commitment we said look UTV a strongest Ritchie brothers as GTD has only grown very low single digits for quite some time.
Our commitment is to get that to grow middle single digits high single digits low double digits kind of keep that pace going.
We further committed to driving our services revenue significantly above the underlying GTP like consistent with this marketplace vision that we would obviously office services on the underlying GTD, that's how we make money, but we would also go above and beyond dipping much further into the $300 billion of transactions.
90% of which occur outside of the auction channel. So we were very very clear about that so what you. What you will always see from us as we deliver right. So again just.
As a reminder to everybody it's not about one quarter, it's not about two quarters, it's about a constant drumbeat of up into the right.
As we drive this vision forward.
So you will constantly see services revenue outpacing the growth of that pace. This is what youre going to hold us to overtime GTT is going to be growing much faster than it has before but the services revenue will be growing faster still and it is going to come from.
Lots of ways. When you think about the fees that we charge for the underlying GTE transactions again think of those as marketplace base and as the market ebbs and flow those fees will get in line. Our commitment. However is really the way to think about your modeling the GTD growth rate was low single digits.
Our commitment is mid than high then double digit services revenue is.
Above GTD and we will continue to grow at a faster pace than GTD kind of why didn't even think about Pac man, it's up to the REIT and then even steeper on the other side, that's really the way.
As you think about your modeling it's less about a point in time it of any again, we adjusted.
The tears up because pricing is up that that would have only allowed us effectively to just kind of keep pace. If you will.
But then there's.
Kind of a market dynamic point of view.
Our pricing, but just the commitment remains and we are focused we are laser focused on driving growth organic driving M&A. If it accelerates our organic growth and then we can grow on it and then really evolving to this marketplace and the way that you guys will see that play out is that the services revenue growth rate will be.
Significantly above the GDP growth rate.
I hope that kind of answers the.
Modelling side of it I don't know if there is something more specific as it relates to this year a share and you wanted to add.
No I think that was fine.
Yes that was great color.
Obviously, a great result in the quarter so that was helpful.
The second question is around GTA V in Canada that was close to 50% in the quarter. Obviously very nice I was wondering if you can maybe break that down a little bit for us. It looks like there was a large contribution from.
Shifting the calendar AG looks like it was pretty strong across the board, including international. So just wondering how to think about the sustainability of the HGTV there.
To me for the balance of the year as well.
Yes, So let me start and then I'm going to turn it over to Kari Taylor Chief revenue Officer.
Canada had a fundamental shift during COVID-19 and you saw it in our <unk>.
AD business.
And the fundamental shift was online in south.
Where historically when we would have to do on farm transaction.
It would have to be large large in person auctions.
Be at the Mercy of weather candidly are.
They're not known for its balmy weather in early months of the year.
And so there was kind of a natural throttling of growth through Covid.
And and our kind of leaning in and investment in our technology, we were able to shift those transactions.
Largely online opening up the calendar for the candidates in opening up the strength of those transactions and the resulting pricing it has been incredible and see it.
Very starkly in Q1 in Canada.
Lots and lots of things the Canadian team is doing right that is the most notable were the transition to online has just unlocked that market.
The way that we never could have before.
Pause here and Carey anything to add.
Thanks, and I think also we're calling out the steady progress of our sales initiatives.
Which is really both a combination of the new coverage model and local yards and.
And an example of the local yards is just really strong growth out of Australia, driven by both frequency and having new geography to sell.
I'll be going much more deeper into the discussion of sales coverage and will be our next week at investor week.
Lots of learnings things, we're starting to scale anything further tests were taking on.
Yes.
Thank you Karen.
So thanks for the answers guys really looks the growth initiatives are working here.
Thank you. Your next question comes from so that Khan RBC Savate. Please go ahead.
Okay, great. Thanks, and good morning, I guess, just on that one of the earlier comments around where the growth could come from in the future with their balance sheet, where does that now and no longer pursuing your auctions I guess, how are you thinking about capital allocation and maybe you can touch on.
The type of M&A, you might be interested in at this point.
Yeah, Let me start and then I'm going to turn it over to Sharon So.
What we have said all along is that we're on a journey for transforming to a marketplace.
When we think of M&A and we have a very robust pipeline. It is about a single word which is acceleration.
Is there are there M&A targets out there that would accelerate our journey.
Yes, then we click down and this is just to share with you. How we look at M&A. We then click down and we say look there are two things that we need from any business that we would look to acquire.
The first is we need a healthy business.
We need our business are strong that we that we believe in the underlying growth potential.
We love the management team this is.
We can certainly see it with Ralph smart equip it needs to we need a very very high hurdle for us to say okay. This is an interesting business.
On the other side and this is as it relates to accelerate we need to ensure that there is an acceleration that that business and that team can provide to the broader ecosystem of Ritchie brothers and really for where we're headed in the marketplace.
So as an example, Ralph very healthy business.
Double digit growth rate continuing we can actually bolster those that's great on the other side, we're already seeing the benefit of route for example, with Ritchie brothers marketplace E.
So just as a reminder, that as a reserve the auction that we run.
It's not about listing a bunch of assets, it's about those assets transacting and recall that transaction until right.
We have applied the route and.
Much like other routes customers to our MPT functionality driving the kill rates significantly higher than before the acquisition and again you can see that in the flow through to our growth. So just an example of how we look at M&A. It has to be very very strong businesses and then they have to really deliver something.
<unk> for the Ritchie brothers ecosystem today like routes has done or in the near future like smart equipped will do.
So I will I will pause here, saying, we have a very robust M&A pipeline that kind of fits those trajectories and <unk>.
Given our leverage ratio, we certainly have the optionality to pursue them.
As they come up but Sharon anything to add.
Yeah, I think what I would add is again, we were incredibly disappointed that we had to withdraw from the euro transaction.
But really the big takeaway from that is the markets are so receptive the credit markets and our bank partners have been so receptive to our growth ideas and the growth potential of this business our balance sheet is in fantastic shape shape, it's just poised.
To be able to support both organic and inorganic opportunities that come our way.
And so although we're disappointed that we were not able to complete that transaction as Anne said we.
We are looking at alternate ways to be able to continue to deliver on our growth strategy and the markets are very supportive and will give us access to capital to do that.
Thanks for that color and if I could just have one follow up on the M&A side I guess, so Europe is obviously a larger transaction added.
Similar type of capabilities, which already was that from your perspective, a one off given its geographic presence or.
Could you pipeline include other similar sort of auction assets more just hey look we need more capital in this geography or this type of or this channel that we're not in or is it more things like routes. We should expect going forward, maybe just things that are more technology oriented.
Yeah. So let me start and then I'm going to turn it over to Jim Kessler, Our President and Chief operating Officer I think the question Youre asking is very insightful in that Theres always an end to the acquisition.
No.
On the surface.
Euro auctions would give us a bigger footprint in Europe , obviously, and again right scale all of the things that went with it.
Made a lot of sense.
The second part of it is equally important and that is that it offers it offered us kind of unique capabilities.
And.
Euro auctions functions on a sourcing model one we've learned from them and we're going to be taking forward, but it is important to understand that there's plenty of things to buy out there, but we're looking for that to for every time, we're looking for a very good business, but we're looking for something that will enhance our capabilities geographically.
Selling model, so on and so forth, let me pause here and turn it over to Jim.
Hi, and thank you so much no I think it's a great question so to answer point.
Two parts so definitely.
<unk> and auction transactions when theres opportunity, just like euro and a certain area or region of the <unk>.
We definitely want to look at those and be opportunistic when we have the chance to do it so 100%, yes, there could be other auction players that fit the need that we have today and then the second thing with the marketplace. When we look at a potential partner and think about ralphs.
Martin equip and Ritchie brothers financial services.
They're very complementary to an auction transaction, but the unique thing that they each have is an ability to generate revenue outside of that auction transaction and think about Ritchie brothers financial services. So.
It works great when someone is buying a piece of equipment with us, but also theres, a second and third bidder and we might not have that equipment disposal at the time, but theyre going to go out and find that equipment someone somewhere else and they can bring their.
Your line of credit with them and.
By that piece of equipment and were still financing that.
Their behalf and the same thing with insights in parts and services and other things that we would look to buy.
Inside of the marketplace, we will have a similar characteristic where they really complement what we do today inside of auction, but also will have an ability to generate a revenue stream outside of just Ritchie brothers at the same time, so that's kind of the path we're on right now.
Okay.
Last one on just the IMS I guess, you called out a pretty sizable increase in the number of organization signed up I guess, maybe you could talk about what drove that is it just.
No balling effect is there an area of the market that you werent focusing on before and then secondly, what are you hearing in terms of feedback from the folks that are signed up that youre, bringing onto the platform in terms of.
Any changes there, suggesting what's working there or what you might need to tweak over the next little while to get more folks signed up.
Yeah. So.
No.
We're very proud of so there was kind of the underlying business performance, we're proud, but we're equally focused on.
Driving the marketplace vision, and making sure that the strategic initiatives are kind of keeping pace. If you will because our ultimate vision is this transformation. So a marketplace again that should result in really incredible services revenue growth and <unk> and.
<unk> growth.
IMS is the linchpin, we've called it the gateway into the ecosystem and right now the way to think about it is we're focused on organization because that is the beginning of the stickiness cycle and the single biggest benefit they're getting right now is the annual contract. So we're before the.
That we went to market before IMF was.
Kind of one auction at a time dealing with one seller for one auction signing a contract for that auction iams's completely pivoted that they are now annual contract.
And although the marketplace, we're still building out the functionality to take full advantage of it which is why we're focused so much on the organizations.
The table for being able to transact on a regular basis and kind of having those customers in our ecosystem. So that has been the single biggest benefit the IMS to bulk customers ourselves and ability to seamlessly continue to do business.
Through through IMS. The reason, it's growing so fast is our sales organization really with Kerry's leadership has taken out to understand how much easier the mix for our customers to do business with us. The fact that it's that it sets up the ultimate stickiness.
With our customers in the future it makes us that much easier to do business with so it's just kind of the drumbeat is continuing and growing on itself and we're really really pleased with how it's going.
Alright, thank you.
Thank you there are no further questions at this time. Please proceed.
Thank you so much okay back to back to me this is Ann.
I just want to thank you all for taking your time this morning.
Or this afternoon, depending on what part of the world to be in.
Just as a summary were.
Really excited about the performance, we were able to drive but.
More than that.
Really excited about the fact that the initiatives that you guys have been hearing about us talk about for over a year now are starting to bear fruit.
And as a public service announcement, because Samir would kill me of our Investor presentation for next week. Please join us virtually clean join us in person.
But we will be coming even more about our story and where all of this is headed but in the meantime. Thank you so much and hoping everybody out their space and continues to stay healthy. Thank you.
Thank you ladies and gentlemen. This concludes your conference call for today, we thank you for participating and ask that you. Please disconnect your lines.