Q1 2022 World Fuel Services Corp Earnings Call
Okay.
Ladies and gentlemen, thank you for standing by and welcome to the World Fuel services first quarter 2022 earnings Conference call. My name East Europe may not be car did they did in the call. This evening during the presentation. All these parts will be in a listen only mode. After the Speakers' remarks, there will be.
The question and answer session instructions on how to ask a question will be given at the beginning of the Q&A session.
At any time did Godfrey you need to reach.
And operator, please press Star Zero as a reminder, these Scott Francis be recorded I would now like to turn the conference over to Mr. Glenn <unk> Vice President.
Yes, you were an Investor relations Mr. Clovis you may begin your conference.
Thank you Jerome good evening, everyone and welcome to the World fuel services first quarter 2022 earnings Conference call I'm, Glenn Clemens said I'll be doing the introductions on this evening's call alongside our lifestyle presentation.
This call is also available via webcast to access this webcast or future webcast. Please visit the world fuel services website and click on the webcast icon.
With us on the call today are Michael can start chairman and Chief Executive Officer, and IRA Burns Executive Vice President and Chief Financial Officer.
By now you should have all received a copy of our earnings release, if not you can access the release on our website.
Before we get started I would like to review World Fuel's Safe Harbor statement.
Certain statements made today, including comments about world Fuel's expectations regarding future plans and performance are forward looking statements that are subject to a range of uncertainties and risks that could cause world fuel's actual results to materially differ from the forward looking information.
A description of the risk factors that could cause results to materially differ from these projections can be found in world Fuel's. Most recent Form 10-K , and other reports filed with the Securities and Exchange Commission.
World fuel assumes no obligation to revise or publicly released the results of any revisions to these forward looking statements in light of new information or future events.
This presentation also includes certain non-GAAP financial measures as defined in regulation G. A reconciliation of these non-GAAP financial measures to their.
The most directly comparable GAAP financial measures is included in World fuels press release and can be found on its website.
We will begin with several minutes of prepared remarks, which will then be followed by a question and answer period.
The prior conference calls, we ask that members of the media and individual private investors on the line participate in listen only mode.
At this time I would like to introduce our chairman and Chief Executive Officer Michael.
Thank you Brandon and thank you everyone for joining us this evening I want to start by recognizing our global team for their tremendous individual and team effort and execution. During these turbulent times there as soon as Covid, then supply chain disruptions and now coupled with historic price fuel and fuel price volatility.
Jody arising from geopolitical events during all of it good continued to deliver on our commitments to our customers and suppliers each and every day with extraordinary skill and expertise remaining calm in the face of what was in essence, a perfect storm of logistical complexity and difficulties in market dynamics.
A big Thank you to all of you.
I've always said that our company's diversified business model is uniquely positioned to deliver during times of uncertainty in the markets, we serve and that when taken together complement each other during times of heightened volatility. This quarter solid overall result is a perfect example of that.
In our aviation segment, our commercial passenger business aviation and cargo volumes were all up year over year with commercial passenger volume approaching 80% in 2019 pre pandemic levels globally, our aviation service and technology offerings also delivered strong year over year growth.
Core aviation business performed very well aviation results were negatively impacted by historic backward dated fuel price environment, which I will explain in greater detail shortly.
At the same time, our marine business performed extremely well navigating a sharply rising bumper fuel price environment, where average bunker prices increased 30% sequentially.
Our aviation business most of our marine transactions are executed on a spot basis.
And higher returns on the back of higher prices, resulting an extraordinary performance when compared to recent periods.
Credit capacity and variably tightens in high priced markets the scale of our business and the strength of our balance sheet differentiate us in a volatile pricing environment.
Can it continue to provide our customers with the products services and credit they require when they need it most and simply put this served us well in the first quarter.
With the backdrop with high container and dry bulk rates strong commodity demand capacity constraints rising interest rates and supply chain inefficiencies and sustainability, we have expanding opportunities to play an important role in the success of board marine customers.
And lastly, our land business performed well in the first quarter, we experienced strong results in our U K heating oil business and solid contributions from our natural gas and power activities, which served to further augment the immediate benefits from the addition of the players energy operations to our overall land business.
With flowers energy, we are better positioned to build a more ratable and leveraging more national platform with a myriad of growth opportunities ahead.
And now I will turn the call over to IRA for his review of our financial results.
Thank you Michael.
Before I walk through our first quarter results. Please note that the following figures exclude the impact of non operational items, which are highlighted in our earnings release. These items include acquisition related expenses and integration costs, which in aggregate were only $500000. After tax in this year's first quarter.
To assist you in reconciling results published our earnings release, the breakdown of the nonoperational items can be found on our website.
The last slide of today's webcast presentation.
Furthermore, before getting to the numbers as Michael already mentioned this was a quarter, which clearly demonstrates the value of our diversified business model.
With aviation negatively impacted by unprecedented market pricing dynamics, while marine significantly benefited from the sustained high price environment and land delivered strong results with fliers now onboard.
I will get into the details shortly but I felt it was important to start by pointing yourself.
Consolidated revenue in the first quarter was $12 $5 billion up more than 100% year over year and putting us on a $50 billion annual run rate for revenue for the first time in our history.
Volume continued to improve across all of our business segments as commercial aviation passenger volumes continue to recover contributing to a 26% year over year increase in consolidated volumes.
Adjusted first quarter net income and earnings per share were $26 $8 million 42 per share respectively.
Adjusted EBITDA for the first quarter was $75 million, that's an increase of $14 million or 23% compared to the first quarter of last year.
With regard to segment volumes aviation volume was $1 7 billion gallons in the first quarter.
Down 2% sequentially from a seasonally strong fourth quarter, but an increase of 45% compared to the first quarter of 2021.
The year over year volume increase resulted principally from the ongoing recovery in commercial passenger activity.
Volume in Marine for the first quarter was $4 7 million metric tons.
A decrease of 3% sequentially, but an increase of 11% year over year.
As stated on last quarter's call continued increases in our core resale activity principally in the container and dry bulk markets and physical operations drove the expected improvement in year over year volume.
Land volume was $1 6 billion gallons or gallon equivalents during the first quarter, an increase of 16% sequentially and 22% year over year.
Year over year volume increase was principally driven by volume associated with the Flyers acquisition as well as continued growth in our natural gas and power activities.
So I'll deal volume was $4 5 billion gallons or gallon equivalents, that's up 3% sequentially and 26% over last year.
Consolidated gross profit in the first quarter was $231 million, an increase of 7% sequentially and 21% year over year.
Before I discuss aviation gross profit I would like to provide some backdrop.
As you know backwardation occurs when oil futures forward prices trade at lower levels than current spot prices.
During the first quarter future forward prices were trading significantly lower than spot oil prices, which resulted in the most severe level of backwardation since future prices have been tracked.
You've actually referred to this as Super Backwardation.
Why is this happens short term supplies dwindled and it's most economies a bounce back from COVID-19 supply growth is simply not kept up and second Russia's invasion of Ukraine is increased supply concerns and driven up current prices with longer dated futures much lower as the market clears.
<unk> does not expect these dynamics for last.
So what does this mean for us.
The impact on our results is most pronounced in aviation, where we carry higher levels of inventory with the longest cycle times and we hedge our price exposure with heating oil derivative contracts as heating oil as the forward market commodity that is most closely correlated to jet fuel.
When heating oil futures prices trade significantly lower than the spot market since we hedge our inventory with futures contracts it is difficult to avoid losses.
This materially impacted aviation's margins and net results in the first quarter.
While the fundamentals of our aviation business remained strong with commercial passenger business and general aviation and cargo activities, all posting solid growth versus last year with.
The segment's gross profit contribution declined 42% sequentially and 16% year over year with the sequential decline driven principally by the inventory issue and seasonality and the year over year decline driven by the inventory impact and the exit from Afghanistan.
During 2021.
As we look ahead to the second quarter, we expect the core business to benefit from the continuing recovery and seasonality with a sequential seasonal increase in volumes likely to be 15% or greater.
However, with the market remaining steeply backward dated it is likely that aviation gross profit will continue to be significantly impacted by the effects of backwardation on our physical inventory positions.
With most of them are aviation contracts renewing at the end of the second quarter as we entered the third quarter, we have more opportunities to mitigate or eliminate this risk should the steeply backward dated market continue into the summer months or beyond.
On a more positive note the marine segment performed extraordinarily well.
Generating first quarter gross profit of $47 million, that's an increase of 55% sequentially at 85% year over year.
As noted earlier the strong result, this quarter was driven by increased returns in our core resale business and a tightening credit environment caused by the significantly elevated price of bunker fuel during the quarter.
As we look ahead to the second quarter, we expect marine gross profit to remain strong as the price of bunker fuel remains at or above first quarter averages.
This trend continues second quarter Marine results should again be materially ahead year over year and relatively consistent with the results delivered in the first quarter.
Our land segment delivered record gross profit of $120 million in the first quarter up significantly both sequentially and year over year, principally as a result of the recent Flyers acquisition, which performed very well in its first quarter. Since we closed the transaction in early January <unk>.
Additional highlights and land include strong seasonal strength in our U K operation, which actually delivered record results in the month of March and while our natural gas activity was down from last year's record performance, which benefited from extreme weather conditions in last year's first quarter performance was still solid and our power.
Business delivered strong year over year growth as well.
Looking ahead to the second quarter land gross profit should experience a sequential seasonal decline, but it should be up materially year over year, driven largely by the impact of fliers.
Onto expenses core operating expenses were $187 million in the first quarter slightly higher than the top end of the range provided on last quarter's call.
Looking ahead to the second quarter, we expect core operating expenses to be similarly, similar to Q1 in the range of $185 million to $190 million.
Bad debt expense in the first quarter. It was only $2 million, that's down about 40% sequentially and year over year.
As our team continues to manage our accounts receivable extremely well at a time, where volume growth and higher fuel prices have increased the size of our overall receivables portfolio to $3 5 billion.
Adjusted EBITDA in the first quarter was $75 million, that's up 36% sequentially and 23% compared to last year's first quarter.
Our interest expense was $14 $3 million in the first quarter as we mentioned on last quarter's call increased interest expense increased principally due to higher borrowings related to the recent Flyers acquisition increased working capital and rising interest rates with rates forecasted to rise further this quarter, we expect second quarter <unk>.
Interest expense to be in the range of <unk>, 15, and a half to six and a half million dollars.
On another positive note our adjusted effective tax rate continues to decline with the first quarter rate at 19, 6% with the rate for this year's second quarter expected to be even lower.
For the full year, we currently expect our effective tax rate to be in the range of 19% to 22%, which is down significantly from 2021.
During the first quarter operating cash flow was negative $72 million, which principally relates to a 50% increase in average fuel prices from December to March driving a 50% or $1.15 billion increase in accounts receivable in the first quarter we.
We mitigated the working capital impact of higher fuel prices during the first quarter by maintaining our net trade cycle at a near record low and as announced a few weeks ago on April 1st we amended our banking facilities, increasing the size of the facility to $2 billion and improving terms, which further enhances our liquidity profile.
And extending the facility's maturity date to April 2027.
This demonstrates the strength of our relationships with our global Bank group and their confidence in our longer term opportunities.
All in all our balance sheet remains strong and we remain committed to disciplined capital allocation to support our ongoing business activities and strategic investments in our core business all focused on driving long term shareholder value.
Finally, we repurchased 500000 shares of our common stock during the first quarter, demonstrating our continued commitment to drive additional shareholder value through buybacks and dividends.
In summary, despite near term headwinds in our aviation business, we delivered a solid overall result in the first quarter, our land business is larger and stronger than ever following the recent Flyers energy acquisition and our marine business. Once again demonstrated its ability to contribute to results handsomely during periods of market in <unk>.
This volatility.
Overall, our business is now significantly more ratable than our business evolve with a much lower point portfolio of business activities, providing greater opportunities to drive operating efficiencies EBITDA growth and higher returns going forward.
And now I'd like to turn the call back over to Mike for his closing remarks. Thank you IRA as I mentioned earlier over the last several decades, we have designed a business model that we believe is built to be resilient through times of adversity.
Since our operating model is not constrained by a single method of fulfillment. Our physical operations is just one component of what we call pre PV or third party physical inventory and logistics and virtual modes of fulfillment. It as our global network of third party supply and service partners.
It gives me together with their physical inventory and distribution capability, which is further supported by our evolving virtual digital capability that manages costs increase operational integration with their customers and partners and has become a bonafide technology and software business.
Combination drive strong value creation that deep commoditize as energy to provide real value add to the market as.
As you know we have reshaped our land portfolio and Mike Crosby gets a lot of credit for that and I will be forever grateful for his contributions as a result of his work and many others I believe the quality of our earnings and the diversity and complementarity of our portfolio will help us drive more durable readable and repeatable results.
The rollout of our common operating model under John Rau combined with the arrival of our long sought after liquid land platforms and world Kinect sustainability solutions better positions us for operating leverage taking market share and embracing transitions as mentioned earlier, the resiliency of our business model.
Allows us to pivot and respond to the inevitable gyrations of energy logistics and the endless amount of geopolitical and societal issues that impact local national and global Commerce I resolution from a simple intermediary for the sophisticated underwriter of risk in omni channel and an omnichannel participant speaks.
Volumes about our potential our evolution continues to be a source of pride for our team is what motivates and animates us in our mission to support global Commerce, each and every day I'm optimistic about the opportunities we have across all of our end markets and I'm increasingly confident in our ability to execute our three PV.
Growth plan with a growing suite of highly desirable energy solutions I'd like to now open the call to Q&A operator.
Thank you at this time I would like to remind everyone that people like to ask a question. Please press star followed by the number one on your telephone keypad. He was he had tweet on from duck knowledge and request.
Question, that's been answered and you would like to withdraw your right.
Tuition. Please press the pound sign if you are using a speakerphone. Please sleep your handset before entering your request.
A reminder, we would appreciate it if the part.
These plants will limit themselves to three questions.
LCA that follow ups Bill plus for just a moment to compile the Q&A roster.
Our first question comes from the line of Ken Alastair from Bank of America. Please proceed with your questions.
Great Good afternoon, Michael and IRA.
Okay.
Good afternoon.
And phenomenal results if not for the inventory issue. So, let's let's hit on on the aviation for a quick second and and or I guess more on the inventory side.
Are there things you can do in the interim.
Maybe not take possession of as much.
And move away from from the one side and just do the reselling is is that an opportunity to to avoid some of these backwardation issues or is it something you have to do to to get price certainty and understanding that the market at any given time, maybe just walk us through your thoughts on that.
Yeah.
I'm going to intercept the past to IRA and he'll fill in with some details.
No.
Just a short history lesson.
You know, we we got involved.
You know in the physical part of the market, particularly in aviation I think it was 2003 and took us a little while to.
Develop expertise there and we certainly have it today I mean, I'm very proud of what we do every day to keep them.
Aviation and a lot of other folks are supplied and were taken extraordinarily responsible counterparty.
So we.
We have extended that model too many many locations and if not for our inventory in some locations there wouldn't be supply where they wouldn't be reliable supply. There is a cost of that and because there is no.
Perfect hedge within jet fuel.
And we're a conservative company I you know, we're a risk management company and we look to cover offer risks and there are not really perfect hedges for jet fuel.
In this.
Crazy market.
These were bought at an effective as I suggested so we're revisiting some of them are.
Our deployment of those physical locations and we're also revealing some other things that we can do in terms of pricing structures on buy and sell them. So.
But we can't turn on a dime that that is the nature of the business, it's a contractual business with commitments and we are.
You know, we uphold those commitments and we always have.
We've reviewed backed as we do with all of our businesses. These are extraordinary times so.
So we believe that we'll have some ability to moderate but those will not really kick in until Q3. So I know if you want to add some more color to that IRA.
No I think I think Mike said it all you know clearly we're trying to optimize and carry no more inventory than we need to and also as Mike mentioned as we get into the third quarter, we have some more.
Flexibility in terms of pricing structure and trying to find ways to.
Reduce the specific risks as much as we can but it's against makes it doesn't turn on a dime and you can't do it overnight but.
Something we're heavily focused on managing through the short term.
And and I were just to clarify or Mike. This is completely different than a few years ago, where you got caught in terms of hedging and pricing went the other way where you could have made money right. So you got out of the hedges. This is just a factor of.
Of taking ownership of that to like you said, Michael it to ensure you had.
Inventory at specific locations well I think it's really a question of scale. It's a question of scale and extremity. So certainly we've built out the business and you know were significant global participant.
And the business has grown and the severity.
Verity of the movements.
In a short period of time has created the you know the <unk>.
So kind of if there's other comments you want to make around that.
Yeah No I mean this is this is different than when you're when you're talking about Ken. This is purely you know the inventory that we have two P M to up to support the core business and just because of the structure of the market.
As you know very difficult to avoid the losses right now as you know getting lots of things. We're focused on we're trying to shorten the amount of.
Transit times that we have which creates more risk.
And in some cases buying and location rather than buying in the Gulf Coast, and then being locked in for several weeks as the fuel travels up pipeline.
So this is a little different the market is never seen this level of backwardation before being next month's price versus the spot price that difference is just absolutely extraordinary.
So you know again, we're working on on focusing on how we can mitigate some of those impacts and as time goes on over the next couple of months the chances increase significantly.
Well that.
That will be able to do that.
Great and just one other follow up for me and then I'll hand, it over but you mentioned in your in your remarks the change in cycle terms.
You know I think I've only seen you rein it in maybe in a in a weaker economic time, where you were concerned about bad debt and potential for bankruptcies and some of it and so maybe walk through I mean, obviously now you're you're extending more credit as pricing goes up and volumes are increasing so maybe walk through your process. There. How you do you have to.
Right.
<unk> contracts are renewed to change those cycle times or walk us through where it is now versus where it has historically.
I think you're talking about the net trade cycle and that it might be in terms of yes, yes, I'm sorry, yeah, yeah, yeah yeah.
We've worked on.
Religiously for for years.
And of course, you know that.
Tighter you could manage that trade cycle, the better your longer term cash flow profile is going to be and there's a little bit of risk mitigation there as well. So we've been bringing that down over time some of that mix of business. Some of that is just smarter business. You know, we're a great trading partners, but maybe in some cases.
We have been too great and you know I have too much flexibility historically in terms of.
Things like extended terms beyond traditional trade terms, so we got a much less of that.
So you know we had been pretty consistently running at about a seven day trade cycle.
For you know for several years and we've just continued to work at that every quarter and now it's just a little over four days.
We could bring it down much lower than that but we're looking to maintain.
Level between four and five days, which is.
Compared to a lot of other business a lot of other industries of.
Gary.
Full respectable metric.
And of course, it reduces the amount I think about.
You know, we're a run rate of $50 billion of revenue.
We only have about $700 million of net working capital that's you know.
That's a pretty good comparative and so we just we're just working on it every day and we are we work the receivables payables inventory days and AR.
It's been sort of at the lowest net number of possible.
Great. Thanks, Mike Thanks, Eric Great Great job on on on the Marine and certainly the the land side and on fliers. Thanks for the thanks for the time over to Ben.
Thanks, Ken.
Thank you. Our next question comes from the line of Ben Nolan from Stifel. Please proceed with your question.
Thanks, Ken.
I've got a.
A couple here.
First is I forgot one of the IRA and Mike you talked about I think it was you already talked about.
The impact of on the business and a rising interest rate environment and how that has historically been positive. Obviously, we were in a seemingly a very quickly rising interest rate environment can you maybe just help me walk through maybe each of the segments or just in general how.
How that does impact the business and the margins in.
And and volumes and everything else and how.
How big of a determinant is it and and how how the business does.
Yes, so so.
The greatest impact then is in marine.
As we you know we'd mentioned on many occasions.
Marine is a spot.
Business, meaning where pricing transactions every day as opposed to aviation, where we're heavily locking into contracts for a year at a time and even in parts of land, we're lacking many contracts for multiple years at a time.
So I would say the interest rate is secondary but important I would say that.
I mean, the principal driver this quarter in particular is just the substantial increase in flat price or the price of a metric ton of bunker fuel.
Rising to more than $800. So that's one and then if you combine that with rising interest rates.
Got a world you know many of the folks that we may come up against the market don't have besides balance sheet than we do right. So they.
They need more capital and capital is becoming more expensive. So it just naturally makes them a little less competitive or in some cases, a lot less and it gives us a greater chance to win on the back of our global scale and strong balance sheet.
That has historically as it did this quarter provided greater opportunities for us in the market and has led to.
You know much stronger results. So this isn't the first time, we've seen that.
Less of an impact in in the other businesses. The interest factor of course, the competitive issue could impact everyone. That's participating in a commodity and a sharply rising price environment, but in the short term, we see the greatest impact in marine just because we're reacting and bidding on business on a day to day basis.
You know without a long term commitment so to speak off so that's why in this environment you've seen the greatest positive impact in green, but there are parts of land as well as an example, where we also saw.
We've proven results. So we saw that it flyers in our first quarter.
They outperformed our expectations driven in part by that phenomenon and even our land U K business in my prepared remarks, I mentioned that March was a record they also.
The results you know indirectly tied to.
This issue as well.
So hopefully that answers your question that you have across the business Yeah. No. That's helpful. I appreciate it.
Speaking of fliers.
The land numbers are pretty good.
It really good.
And you'd call that Flyers is sort of outperforming and I know, there's a degree of seasonality there.
But you know a quarter into the deal now does it feel like E. What would sort of you'd originally outlined in terms of your expectations for accretion and the impact on the company does it feel like given US one solid quarter end those might've been a little conservative yet.
Yes.
They weren't they werent lets say a couple of things there, we're a little conservative by design, because when you're doing something new.
You don't want to get ahead of your skis until until you hit the slopes so to speak up. So you know we had a good first.
Ron in the first quarter and your comment on seasonality in first quarter is a seasonally.
Seasonally weakest quarter for that business. Historically, so you know we saw outperformance there to the extent that maybe they wont be seasonality because you know, it's not definite that they're going to repeat that.
In the second quarter, but overall I would say, yes based on where we are today you know things can change, they're certainly performing at a level.
Above all.
Our initial expectations, which is just fantastic a great team of people they've been working round the clock to.
Integrate themselves into the the world fuel platform and.
We've learned a lot about what they do well and there is even though we're in a bigger company.
Where we're learning from them every day.
In some areas some areas, they're learning from us, but we certainly gotten off to.
Two a good solid start and we hope that continues for the balance of the year.
Alright.
And then as well if I'm limited to three maybe I'll have one little tiny polymer.
Yeah.
Okay.
There was a you know you're again, you're one of the things on the land side that you called out as having a good impact.
Natural gas prices, especially in Europe , with LNG and everything else are just crazy and I think theres a lot of people looking for alternatives.
To meet their thermal energy demand.
Are we in an environment here do you think where maybe.
There's an opportunity to continue to see a little extra benefit.
And then for weather, whether its heating oil fuel oil or whatever just people looking for a higher margin for you alternative to.
Two are really expensive natural gas pricing.
Okay.
No I don't think that isn't necessarily the case and you know we did as.
As you pointed out.
Did very well in the heating oil season in the U K combination of weather and volatility in the marketplace, but that season is about to end right.
So we're doing we still did really well in April but once you get into May and June .
That level of activity wanes, whether when you're describing and may have a positive impact as we approach the fall and good question.
I'd be guessing if I said that would be the case, but.
You know with despite.
The craziness going on in many parts of Europe .
Our guys are hunkered down and it really delivered.
Very solid results.
Player and Chris and the rest of the team in the U K, if you're listening I really you really nailed it and.
We're looking forward to millions of index.
Winter season in that part of our business.
Great well that's.
There there are probably a few pints in in the U K at this point, but.
While we didn't just a little clarity when you're talking about sort of switching between heating oil and natural gas so I'm not sure that I quite yet.
Right just because natural gas is so high you know maybe.
Maybe there's a little bit more persistent demand for heating oil is kind of a.
Yeah.
I have to say I don't know the answer to that question, but.
Research that.
Okay.
The last one and this is just a little really just kind of a modeling type question, maybe IRA there was a I think a little over $5 million other income item that I had.
Impact on net income and any color as to where where that came from.
Yes.
Yeah of course, so I know you've been asked that question. So let me answer it.
So yes, there are some some one area we've done a much much better job at the last several years is managing foreign exchange risk, we actually have a couple of new folks that we brought on board to focus on that day in day out to make sure you know we don't have any unnecessary losses.
In this particular quarter, we actually with all the volatility we couldn't avoid generating some games. So we had a couple of million dollars.
Foreign exchange gains and in regions that are very difficult to hedge and in market Street in the right direction.
And we also had I would say more than our average.
Income from minority.
We hope you have a couple of those one of them relates to the Exxon deal in aviation that we did several years ago as those markets come back.
We generated some more profitability there and there were a couple of other miscellaneous bucket, but most of it was the the equity earnings and had a couple of million dollars of foreign exchange gains should that offset a bit of.
The growing amount of interest expense interest rate.
Okay.
I appreciate that color and thanks for thanks for.
Let me have an extra half question there.
Yeah, Ken if you're still listening we all you would have a microphone.
<unk>.
Yep.
Mr. <unk> there are no further questions at this time.
I'll turn the call Matt do you for closing remarks.
Well thank you.
I really wanted to say, thank you to our incredible delek dedicated talented passionate team that really makes our company. What it is everyday of the week for our customers our partners our shareholders communities. Thank you very much and look forward to talking to you next quarter. Thanks very much for all your support.
Ladies and gentlemen that does conclude the conference call for today, we thank you for your participation and ask that you. Please disconnect your line.
Yes.
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Yeah.
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Okay.
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