Q2 2022 Getty Realty Corp Earnings Call
Yes.
Good morning, and welcome to you're getting real cheese earnings conference call for the second quarter 2022.
This call is being recorded after the presentation, there will be an opportunity to ask questions.
Prior to starting the call Joshua Dicker Executive Vice President General Counsel and Secretary of the company will read a safe Harbor statement and provide information about non-GAAP financial measures.
Please go ahead Mr Dicker.
Thank you operator.
I would like to thank you all for joining us for Getty Realty's second quarter earnings Conference call.
Yesterday afternoon. The company released its financial results for the quarter ended June 32022.
Form 8-K and earnings release are available in the Investor Relations section of our website at Getty Realty Dotcom.
Certain statements made in the course of this call are not based on historical information and May constitute forward looking statements. These statements are based on management's current expectations and beliefs and are subject to trends events and uncertainties that could cause actual results to differ materially from those described in the forward looking statements.
Examples of forward looking statements include our 2022 guidance and May also include statements made by management in their remarks and in response to questions, including regarding the Companys future company operations.
<unk> financial performance and the company's acquisition or redevelopment plans and opportunities. We caution you that such statements reflect our best judgment based on factors currently known to us and that actual events or results could differ materially I refer you to the company's annual report on Form 10-K for the year ended December 31 2021.
And our other filings made with the SEC for a more detailed discussion of the risks and other factors that could cause actual results to differ materially from those expressed or implied in any forward looking statements made today you should not place undue reliance on forward looking statements, which reflect our view only as of the date hereof. The company undertakes no.
<unk> to update any forward looking statements that may be made in the course of this call also please refer to our earnings release for a discussion of our use of non-GAAP financial measures, including our updated definition of adjusted funds from operations or <unk> and our reconciliation of those measures to net earnings.
That let me turn the call over to Christopher constant our Chief Executive Officer.
Thank you Josh good morning, everyone and welcome to our earnings call for the second quarter of 2022.
Joining us on the call today are Mark Olear, our Chief operating officer, and Brian Dickman, Our Chief Financial Officer.
I will lead off today's call by providing commentary on the quarter's financial results and investment activity offer some observations and perspective on the operating environment.
Sure.
As usual Mark will then take you through our portfolio and Brian will discuss our financial results.
Our second quarter results again demonstrated the successful execution of our strategy.
Cash flows from our existing portfolio and growth from our investments.
Automotive retail sectors.
For the quarter, our base rental income grew eight 1%.
Our adjusted funds from operations or <unk>.
Increased eight 3% and our <unk> per share grew to 53.
In the first half of the year the company invested approximately $59 million.
More than $50 million in the second quarter.
We also ended the quarter with more than $125 million of commitments for the development and acquisition primarily.
Properties.
Historically, carwash centers, which we expect to fund over the next year or so.
We are well positioned to fund this investment activity with cash.
Including the 365% private placement notes that will be funded in January of 2023.
We continue to build our pipeline across all of our target asset classes and remain disciplined in our approach as we navigate an evolving marketplace.
Our strategy.
The high quality real estate Mercury.
And national operators.
Retail sectors.
Our relationships underwriting expertise and opportunity set we are confident in our ability to continue executing on our investment strategy.
Breasts.
With regard to the convenience store sector as we highlighted last quarter when discussing the National Association of convenience stores state of the industry report the overall industry had a record year in 2021.
Yes, we've seen the full report a few themes stand out.
First larger multi store operators continue to grow and take market share primarily due to expanded product offerings and our focus on customer engagement in store experience.
Second the use of loyalty programs in the <unk> sector has more than doubled to almost 70% over the last few years, one of the leading factors in driving customer visits and larger basket sizes per visit.
Third 2021 saw a significant rebound in foodservice sales and gross profits, which both grew approximately 18%.
And finally, despite continued volatility in the oil markets fuel volumes continue to recover and average fuel gross profit.
Healthy and generally in line with recent years.
Focusing on our portfolio our tenants continue to produce strong results as evidenced by the slight decrease in our rent coverage ratio of two seven times this quarter.
And then of course of our discussions with our tenants we are receiving information.
So it just pilot.
Their businesses continue to thrive as they offer customers quick and easy access to food and beverages car washes and fuel all of which cannot be replicated by grocers big box retailers for online purchases.
The vast majority of our tenants our top 100 store operators or top 20 car wash operators.
Thank you guys store counts.
Continue to demonstrate that they have the scale to compete.
The ability to perform various market environments.
In general we believe that he is very well positioned.
Sure.
Institutional.
Central consumer goods and services.
Strong balance sheet low leverage.
Okay.
We remain as focused as ever.
Joe.
Diligence and underwrite new investment opportunities strong metropolitan markets.
The unlocking value through active asset management.
Are you at all.
We believe our success year to date and our current pipeline demonstrates our ability to source opportunities that align with our investment strategy and that we are.
To continue creating shareholder value through earnings growth portfolio diversification as we move through 2022 and beyond.
With that I will turn the call over to Mark to discuss our portfolio and investment activity.
Thank you Chris.
As of the end of the second quarter. Our portfolio includes 1013 net lease properties five active redevelopment sites.
Vacant properties.
Our weighted average lease term was eight six years and our overall occupancy excluding active redevelopments was 99, 4%.
Our portfolio spans 38 states across the country, plus Washington, DC, and our annualized base rents, 65% of which comes from the top 50 Msas in the U S are well covered by our trailing.
12 month tenant rent coverage ratio, which increased marginally to two seven times.
This quarter.
In terms of our investment activities, we completed $59 $3 million of investments in the first half of 2022.
Reflects $55 million of acquisitions.
Developed in development or development planning on 17 properties in the second quarter.
This quarter's investments include closing on the acquisition and lease back of eight expressed held carwash properties in the Austin, Texas.
Boston, Texas, MSA with go car wash for $36 4 million.
Macquarie one additional carwash property from go car wash, San Antonio MSA for $3 6 million.
Acquiring two properties from Splash Carwash, which are located in New York for $6 1 million.
Acquiring one Canadian store in New York City, MSA for $1 1 million.
Providing approximately $3 3 million of construction funding for the development of five new to industry properties, including two convenience stores in the Charleston, South Carolina Metropolitan area, and three car wash properties, including our initial transaction with Magnolia Carwash.
These properties are located in the Jacksonville, Florida, New Haven, Connecticut, and Newburgh, New York Metropolitan areas.
As part of these funding transactions, we will accrue interest on our investment during the construction phase of the project, we expect to acquire the property via sale leaseback transactions upon completion and final funding.
Our aggregate initial cash yield on our second quarter investments was approximately six 6%.
Year to date, the weighted average lease term of the properties acquired was $14 eight years aggregate initial cash yield on.
On our year to date investments was approximately six 6%.
Looking ahead regarding the commitments to fund the acquisitions and developments that Chris referenced while we have fully executed agreements for each transaction timing and amount of each investment is ultimately dependent on our counterparties and the schedules under which they are able to complete development projects and closed certain business acquisitions.
It is our expectation that we will be funding. These transactions throughout the next 12 months or so and that the average yields will be in excess where we had closed acquisitions year to date.
We continue to underwrite a variety of potential investment opportunities during the quarter.
With convenience stores, representing 30% of underwritten volume in our other oil or other convenience automotive retail sectors, representing the balance 70%.
Not see material expansion of the asking cap rates for the potential transactions, we underwrote in the quarter, but we are starting to see movement in favor of the buy side and expect the trend transitioned to continue as we continue through 'twenty two and into 2023.
While the timing of direct sale leaseback transactions can be difficult to predict based on our current visibility. We are confident that we can continue to park continue partnering with institutional operators in our targeted asset classes to acquire high quality real estate in major metropolitan markets.
Moving to our redevelopment platform during the quarter, we invested approximately 300000 and projects which are in various stages in our pipeline. We have seen <unk>. Finally, we have seven signed leases with legend, which includes five active projects one projects at a property, which is currently subject to triple net lease and has not yet been recaptured from the current tenant.
And one signed LOI on a vacant property.
The company expects rent to commence at these and other projects over the next several years, including later in 2022.
Turning to our asset management activities for the second quarter, we sold one property realizing one 5 million in gross proceeds and exited one lease property.
We will continue to pursue dispositions of properties that we have determined are either no longer competitive in their current format youre not as compelling redeveloped development potential, which we believe has compelling valuations that may allow us to recycle capital and manage our balance sheet.
With that I'll turn to Chris over to Brian to discuss our financial results.
Thanks, Mark Good morning, everyone last night, we reported <unk> per share of <unk> 53 for the second quarter of 2022, representing a year over year increase of one 9% versus <unk> 52 per share we reported in the second quarter of 2021.
For the quarter or <unk> and net income were <unk> 83, and <unk> 64 per share respectively, including a significant noncash environmental adjustment, which we will discuss shortly.
Our total revenues were $41 $2 million for the second quarter, representing a year over year increase of 6%.
Lease rental income, which excludes tenant reimbursements GAAP revenue adjustments and any additional rent grew eight 1% to $36 8 million in the second quarter.
Long acquisition activity and recurring rent escalators were the primary drivers of the increase with additional contribution from redevelopment projects that were completed last year, all of which was partially offset by some modest disposition activity.
On the expense side G&A costs were $5 3 million for the second quarter, an increase of $200000 compared to the second quarter of 2021 due to higher personnel costs.
Property cost decline in the second quarter of 2022 due to lower property operating expenses, including a permanent reduction in rent expense as we have exited nine leased properties over the past 12 months. These reductions were partially offset by increases in leasing and development costs, primarily related to demolition work at certain of our active redevelopment projects.
Environmental expenses, which are highly variable due to a number of estimates and noncash adjustments declined to a credit of $15 $9 million for the quarter versus an expense of $100000 in 2021, primarily due to a reduction in estimates related to unknown environmental liabilities specifically.
During the quarter. We concluded that there is no material continued risk of having to satisfy contractual obligations relating to preexisting unknown environmental contamination at certain properties. Accordingly, we removed $16 $8 million of unknown reserve liabilities, which had previously been accrued for these properties.
Turning to the balance sheet and our capital markets activities, we ended the quarter with $625 million in total debt.
Consisting entirely of senior unsecured notes with a weighted average interest rate of four 1% and a weighted average maturity of six six years, we have no floating rate debt exposure other than our $300 million unsecured revolving credit facility, which was undrawn at quarter end and having addressed our 2023 notes maturity with the price.
Placement, we completed in February we have no debt maturities until 2025.
As of June 30.
EBITDA was four one times and total debt.
Total capitalization was 33% while total indebtedness to total asset value calculated for our credit agreement was 36%.
Quarter, we did not issue any shares under our ATM program.
But below that reached $20 million of cash on the balance sheet.
Oliver and committed 2023 debt financing at an attractive rate.
<unk> capital to fund the $125 million.
Acquisition and development funding commitments.
Correct.
Pro forma for these transactions, we expect our balance sheet remains strong putting ample liquidity and leverage in line with our previously stated ranges.
Our investment pipeline malls.
Hello capital sources, including common equity disposition proceeds and incremental debt and share with funding transaction being accretive manner, while maintaining our investment grade credit profile.
With respect to our environmental liability ended the quarter at $29 $5 million, which was a decrease of more than $18 million from the end of 2021.
Primary driver of the significant reduction was the removal of $16 8 million.
Unknown reserve liabilities as I described earlier.
These reserves were primarily for legacy properties, where we retained the responsibility to cleanup preexisting unknown environmental contamination for defined look back periods, which expired during the quarter.
In the second quarter, our net environmental remediation spending was approximately $1 3 million.
Finally, the company is maintaining the 2022 <unk> guidance, we provided last quarter, which was $2 10 to $2 12 per share.
As a reminder, our outlook includes completed transaction activity to date, but does not otherwise assume any potential acquisitions dispositions or capital markets activities for the remainder of the year.
Specific factors, which impact our <unk> guidance include variability with respect to certain operating and youll pursue cost and approximately $400000 of demolition costs, which run through property costs on our P&L.
With that I'll ask the operator to open the call for questions.
Thank you ladies and gentlemen at this time, we'll be conducting a question and answer session.
I'd like to ask a question you May press star one on your telephone keypad.
Confirmation tone will indicate your line is in the question queue. You May press star two if he would like to remove your question from the queue.
Fuller participants using speaker equipment, and maybe this may be necessary to pick up your handset before pressing the star King.
Our first question comes from the line of Todd Thomas with Keybanc. Please proceed with your question.
Hi, Thanks, good morning.
Chris or Mark I guess on the.
$125 million portfolio of development and acquisition properties I think you indicated that the expected yields are above the six 6% cap rate on the year to date investments.
What's that spread look like I guess, just given that there is uncertainty around.
Interest rates and asset pricing over the next year can you just provide a little bit more color.
Maybe bookend.
One of the Premier.
Sure Thanks embedded in that pricing.
Yes sure.
Hard to give a specific range this multiple transactions that make up the 125.
Again, what I'd say is we put capital out.
$6 six over the first six months of the year.
What we expect in the back half of the year, both for the $125 million of committed deals plus everything that we're pursuing.
Existing pipeline.
As Adam.
North of where we've deployed year to date.
Okay can you just give us that sort of 50 basis points, maybe 100 basis point premium.
Just sort of.
Any additional insight there just help us kind of size up what that premium might look like.
Again, there's multiple deals inside of that Todd So I think it ranges from.
No.
20 bps to hire right across the board.
Okay.
And then in terms of the timing so.
12 months roughly.
For these.
For these to be acquired upon completion or there are there are certain properties that could be delivered in 'twenty two or is it all expected to be sort of around the same time that timeframe, perhaps maybe mid year 'twenty three.
No I think reasonably phrased the delay we did it again these are several transactions that may drop to 125.
Some of this development funding.
Which we expect to complete the deals.
The leaseback upon the final draw so we expect to.
Our investing about 125 in the back half of 'twenty, two and some will definitely be in 'twenty three as well.
Todd This is Brian about roughly 75% of that total our development funding deals and again those are funded overtime as Christmas. Thanks, we'll be deploying that capital accruing interest and then ultimately acquiring the properties at the end the balance of that pipeline or acquisitions, and so that capital be deployed.
And one in one transaction versus over the course of time like the development funding.
Okay, Alright, that's helpful got it and then just thinking about acquisitions.
Acquisitions, and sort of the investment pipeline from here and I guess beyond that that $125 million.
Portfolio, how do you feel about the pipeline for more near term opportunities.
I think I think last quarter.
It sounded like there was a healthy pipeline, we see this 30 property portfolio heading.
But is there a potential for additional investments.
Sort of before that.
Hats or should we expect to see the pay flow ahead of next year as.
These <unk>.
Developments are funded and ultimately acquired.
So it's mark it's regarding the kind of inbound or the <unk>.
Activity around the pipeline, it's been pretty consistent we're pretty.
Happy about where we are.
Quarter to quarter, but year over year. It continues to grow we see a lot of opportunities.
As we mentioned we continue to grow the diversity within our pipeline.
Looking at not only convenience stores car washes, but all the other automotive experiences so.
We've got a lot of activity.
A lot that we're looking at to various stages of underwriting evaluation.
But what we're seeing.
Okay.
One last question around the environmental.
Our liability.
If you have any visibility on the balance of that liability.
Brian You mentioned that there were defined look back periods that expired during the quarter can you discuss.
The balance of the environmental liabilities.
And any additional insights around.
Around that.
Sure. So the balance at June 30 was $29 5 million, that's what's on the face of the balance sheet within that there is about $10 $6 million of what we call known our liabilities. So those are.
As defined net known contamination that we're working through and that those are dollars that will be deployed over time.
The balance of the $18 9 million that represents unknown reserve liabilities.
Within that bucket that we will continue to have similar reductions although nothing quite of this magnitude. The second quarter here was the largest but as additional look back periods expire.
Throughout this year, primarily in Q4, we'll see that come down as well again not quite the order of magnitude we saw this quarter.
<unk> another.
$5 $6 million as we get towards the end of the year, we will see a similar similar activities that we saw this quarter.
Okay, Alright thats helpful. Thank you.
Our next question comes from the line of Brad Heffern with RBC capital markets. Please proceed with your question.
Yes, good morning, everyone.
Brian a question on the guidance. So just given you you don't normally include forward acquisitions I'm curious why the Guy didn't go up this quarter given the 50 plus million in acquisitions that you completed during the quarter is there some sort of offsetting factor there.
No no offset we do it.
Including completed transaction as of the date of the call Brad So when we put out the release and had the call last quarter.
Upwards of $85, 90% of that act.
The quarter had already closed so the incremental activity from a closed transaction perspective was just about six or $7 million and that didnt have an impact on the range that we put out.
Okay got it.
And then on the new $125 million I think you said, 75% of that development funding.
It seems like a pretty big number I'm just curious has there been a change in terms of how.
Counterparties are thinking about you as a source for development funding maybe related to the to just backdrop and rates going up.
Yes so.
We didn't throw out 75% sorry.
Sorry, just to clear that up it's a combination of development funding.
Acquisitions.
There has not really been a change as to how our tenant partners are thinking about us.
I would say is that by offering both conventional sale leaseback financing and development funding. It has opened up more transaction opportunities for Getty and in certain cases with the same tenant right, where they've got an acquisition and they want to do new construction for new to industry sites. So really it's just about being.
Capital provider to our tenants in our core asset classes and across the asset classes certain of our tenants are more comfortable developing their prototype stores.
Jason.
So it's very frothy acquisition pricing.
And others continues to steadily acquire small chains or some of our small.
Portfolios that are adjacent to their existing footprint.
I don't view it as a change I think it's just another tool that we can offer to our partner tenants and our asset class has been very well received.
Okay got it and sorry, just for clarification, Brian I thought I thought earlier, you said something about 75% of the 125 what was that figure.
So that was that.
Ryan was referencing when we talked about the guidance.
About 85% of what we completed in the second quarter, while already completed by the time, we reported our first quarter earnings at the end of April .
Okay, Okay got it.
Thanks.
Yes.
Our next question comes from the line of Mitchell Germain with JMP Securities. Please proceed with your question.
Good morning, So this isn't a unitary lease on the $125 million right. How many transactions does it represent.
It is not a unitary lease.
Yes, I'd say about half a dozen.
Arent different tenants within there and again it's.
It's a combination of.
Funds that will be disbursed through our development funding program, which ultimately ultimately will be.
Completed with the sale leaseback at the end and then typical sale leaseback.
Funding for acquisitions.
And are these leases expected to have a greater amount of.
Tom relative to your broader portfolio should we think of it from that perspective.
The lease term.
It's in upon project completion and upon the sale leaseback, so no I wouldn't.
The relatively in line.
With our standard lease terms.
And thats it.
Given.
The rate environment, and obviously cost.
Labor and construction going higher.
Does that have any is that having any impact on your underwriting and the yield potential of your development business.
Yes, so its markets as far as the forward look obviously.
On the development side, the tenants are dealing with supply chain material costs labor issues like everyone else one of the good things as Chris mentioned is the tenants have some scale. So they do have some buying power that we're dealing with so they can hedge against that that risk, but we are we are.
We do contemplate a contingency.
And each budget that we do on a project by property by project property basis, which allows for some cost overrides as time goes by and the underwriting assumes that contingency. So we're protected against that cost and we have a collar.
All of that.
Not to exceed number in these deals so we have a hedge against that also.
Yeah.
Okay last question. Thank you very much.
If you.
How should we think about kind of one off granular investment strategy, knowing that you've got this $125 million commitment outstanding will likely.
It has slowed things a bit.
Or is your appetite is still there to continue to grow.
No I'd say, our appetite is still there to continue to grow market and his team are out there sourcing new opportunities.
Again this is a year multiple transactions, which we expect to fund over a year I think it's a little different in that we're a large $125 million single tenant.
Unitary lease sale leasebacks.
It allows us to figure out how to raise that capital over time.
Thank you.
Okay.
As a reminder, ladies and gentlemen, it is star one to ask your question. Our next question comes from the line of Joshua <unk> with Bank of America. Please proceed with your question.
Yes, everyone.
Just.
Just kind of curious on the capital needs for that $125 million is that all taken care of I know you did the <unk>.
Forward debt offering it last quarter.
But are there any additional needs.
Hey, Josh it's Brian shortly the short answer is no. If you think just initial funding again, we have an undrawn revolver, we have significant leverage capacity you can fund all of this with.
That and still be within our previously stated ranges.
When you look at it from more of a permanent financing perspective, and we have $20 million of cash on the balance sheet. As we've mentioned a few times. This activity takes place over the next year and change so generate call. It another $15 million to $20 million of free cash flow during that timeframe and you have the $50 million.
Net incremental debt proceeds in January again, Thats, a $125 million loan, but we're using $75 million to repay our June maturities. So thats at $50 million net so if you just look at cash and those debt proceeds proceeds excuse me your 80 $590 million right there of the $1 25.
The balance could be on the revolver for a period of time and then we take it out maybe with asset sale proceeds maybe we term it out at a later date as part of a larger debt offering.
See some.
Movement on the <unk>.
Equity side or equity side vis vis <unk>.
The investment yields on this maybe you go back to using ATM activity things like that but it's a small amount. So the lion's share of that we feel is.
Take care of them permanent perspective, and again significant revolver and leveraged capacity beyond that.
Okay no. Thanks for the color Bryan.
And then just thinking about investment spreads in today's environment.
Kind of where do you think those are maybe relative to kind of.
Historical average.
Because a lot of moving pieces between cost of capital and then just private cap rates.
Sure.
Okay I'll start it's Brian I don't think Theres any question that Dave they've gotten a little skinnier alright, Josh I think we're I think we're all seeing that the capital costs. The increase in capital costs are are impacting us probably don't want to get into too specifics in terms of Oregon, a order of magnitude, but I think the important takeaway is that we can continue.
To invest Accretively and we can continue to maintain the investment grade profile of the balance sheet and its coming upon mark and his team to identify the right investments and it's incumbent upon myself and the rest of the group to source the capital to fund it but we feel we feel well positioned for this environment given the assets we invested in.
Given our current status of our balance sheet liquidity and.
That's the business model, we have and that's the challenge and the opportunity in front of us.
Great. Thanks, everyone.
Our next question comes from the line of John Masako whatsoever to breakdown. Please proceed with your question.
Good morning.
So I know, we've kind of slice and dice the $125 million.
Of transaction.
Quite a bit already but just maybe roughly speaking what's kind of the split between C store in carwash in those.
Collection of portfolios.
This set of 125 K is predominantly Carwash R&D.
The exact number right in front of me, but it's probably 70%, 80% carwash the balances as C store.
And again similar distribution at the development funding.
Acquisitions are Washington there.
Our weighted towards car washes at the answer.
Okay that makes sense.
And then have any of those transactions closed yet quarter to date, and then kind of as a follow on.
Are any of them kind of included in guidance.
$125.
Last night, we had not bought.
Did any of that.
Okay.
And then maybe kind of.
Getting away from that transaction on the redevelopment side of things what does that pipeline look like today, maybe in light of some of the <unk>.
<unk> seen around construction cost inflation and.
Construction labor inflation.
Is that maybe slow the outlook for what you can do on the redevelopment side with the existing portfolio or.
Is that still kind of going as it was maybe six months ago.
I don't think it slows the outlook and our desire to continue to participate and grow it broaden out offering.
It does it does effect has effect on the ability to forecast timing, whereas at a property level you've got as you just mentioned.
Hi chain and labor material sourcing issues that the that the tenants who are actually building. These properties out deal with on a day to day basis. So yes.
We're in contact with them on a nonstop basis to stay current on where their projects are so we can forecast the quarter for our for our funding needs.
And it's all around just managing it and managing that relationship manager you need kind of the.
I've said before the book into the deal what's the maximum cost exposure Max exposure, we're getting.
And I think we do a great job doing that and working with our tenants, but working back to your question. It doesn't we don't have any slowed appetite or.
Sure.
Excitement around the future to continue to grow that program just to add John that redevelopment has always been sort of a value add yields foreign excess of the acquisition market alright. So.
But we're still comfortable taking.
In that program and expanding as much as we can because the yields are still very attractive from our standpoint.
Okay, I mean is there.
Or an amount that you would view as reasonable to have.
In that program at any one given time or kind of targeted investment in that program at any one time.
I think that our our limitation that program has always been.
Having the ability to access some of our assets in the portfolio, that's almost 100% occupied and tenants are performing quite well in their own businesses.
A lot of.
Ability for us to access <unk>.
<unk> said that might be a great redevelopment candidates.
So the team here has done a great job.
Sourcing these opportunities working with our existing tenants working with new retailers to the portfolio.
It's more about.
Binding properties in our portfolio right, where there is a need to.
To do something with them and then matching that with a with our retailers looking to expand so.
I don't view it as a key.
Capital issue for us.
Okay.
That's it for me thank you very much.
There are no further questions in the queue at this time I'd like to hand, the call back to management for closing remarks.
Great well. Thank you everyone for joining us for our second quarter call. We look forward to getting back online with everybody in October .
Our third quarter of 2022.
Ladies and gentlemen, this does conclude today's teleconference. Thank you for your.
You may disconnect your lines at this time and have a wonderful day.