Q2 2022 Unitil Corp Earnings Call
a great solution in many parts of the country, they are not sufficient to heat most homes during the coldest New England winter days when their maximum output is dramatically reduced. Natural gas, whether it's the sole heating source or in combination with electric air source heat pumps, continues to be the most economical heating source. Another way to think about the importance of our natural gas system is the amount of energy delivered relative to our electric system. Despite having almost 25 percent more electric customers, we deliver about four times more energy through our gas infrastructure.
than our electric systems on an annual basis, and up to seven times more energy during the winter months. The gas system is fully capable of delivering this amount of energy while maintaining both reliability and affordability.
For the electric system to deliver the energy needed for heat pumps or electric vehicles, it is likely that significant investments will be required.
With that, I'll now pass it over to Bob who will provide greater detail on the quarterly and year-to-date results. For the delegate we are presenting a new link Oracle 2018 and Adobe
Thank you, Tom, and good morning, everyone.
I will begin on slide 8.
As Tom noted, today we announced second quarter earnings of $4.9 million or $0.30 per share.
On a year-to-date basis, net income increased by $4.8 million, or 21 cents per share, compared to the same period in 2021.
That strong growth is the result of higher sales margins, supported by successful new Hampshire rate case results, partially offset by higher operating expenses.
As a reminder, in the third quarter of 2021, we reported break even earnings and expect similar results in the third quarter of 2022. As Tom noted, for the full year, we continue to expect earnings growth above the upper end of our 5% to 7% range.
Turning down to slide 9, I will discuss our electric and gas volumes and margins.
Starting with electric operations, for the six months ended June 30, 2022, electric adjusted gross margin was $48.2 million, an increase of.2 million compared to the same period in 2021.
The increase in electric margin reflects higher distribution rates and customer growth, partially offset by cooler early summer weather.
Commercial and industrial unit sales increased 1.2% and customers increased by 490 or 1.5% over the first half of 2021, reflecting customer growth in both the residential and commercial classes.
moving to gas operations.
For the six months ended June 30th, 2022, gas-adjusted gross margin was $80.2 million, an increase of 7.4 million, or 10.2% relative to the same period of 2021.
the increase in gas margin reflects higher rates, customer growth, and colder winter weather.
Unit sales were up 3.3% or about 0.9% on a weather normalized basis.
Going forward with a significant portion of sails now under decoupled rates, the effect of weather will be significantly moderated.
Moving now to slide 10, we provide an earnings bridge comparing year-to-date 2022 results to 2021.
As discussed, year-to-date 2022 adjusted gross margin increased a combined $7.6 million, principally as a result of higher distribution rates, customer growth, and colder winter weather.
Operating and maintenance expenses increased to $2.4 million, largely due to higher labor costs and professional fees, partially offset by lower utility operating costs.
Depreciation and amortization increased by $0.6 million, reflecting higher levels of utility, plant, and service, partially offset by lower depreciation rates, resulting from the rate case order received for the company's electric distribution subsidiary in New Hampshire.
Taxes other than income taxes increased by 1.1 million dollars, reflecting higher local property taxes on higher utility plant and service and higher payroll taxes.
Interest expense decreased $0.5 million due to lower interest on long-term debt, partially offset by higher interest on short-term borrowings. $0.5 million due to lower interest on short-term borrowings.
Other expenses decreased by $1.1 million, largely due to lower retirement benefit costs.
Lastly, income taxes increased $0.3 million as a result of higher pre-tax earnings in the period, partially offset by the flowback of excess accumulated deferred income taxes under regulatory orders received in New Hampshire.
Slide 11 provides an overview of our investment outlook, which totals about $755 million over the coming five years. Slide 11 provides an overview of our investment outlook,
These investments will ensure the safety and reliability of our distribution system, enable system growth, advance our grid modernization initiatives, and enhance our customers' experience.
Overall, we anticipate long-run annual rate base growth in the range of 6.5 to 8.5 percent, with our investment mix becoming increasingly balanced between gas and electric operations.
As we've noted in the past, there remains potential upside to the capital investment forecast.
Now turning to slide 12.
Our dividend increases in 2022 have been greater than prior years, reflecting our confidence in our strategic plan and in our ability to execute the plan.
On a trailing 12 month basis, our payoff ratio has been 60% squarely within our target range.
Looking forward, we will continue to evaluate further accelerating our dividend growth consistent with our target payout range and earnings growth.
And with that, I will turn it back over to Tom.
Thanks, Bob.
Flight 13 provides a recap of some of the key objectives we had laid out in prior calls and our success in achieving them.
We continue to earn well on invested capital and reaffirm our long-term earnings growth of 5-7% We continue to run the capital you
In 2022, we are on pace for earnings growth will exceed the high end of the long term range.
Our target dividend payout ratio remains at 55 to 65%. We have successfully moved our payout ratio into that range, patiently lowering it over the last several years.
We filed and settled two rate cases which addressed many key initiatives including revenue decoupling.
Operationally, our goal is to be an industry leader in customer service, customer and employee safety and system reliability, and we think we're doing just that.
Finally, in 2019, we published our first sustainability report and reaffirmed our commitment to corporate responsibility. You can see that by photoc Paste motto here.
Since then, we followed through with continued status reports, carbon reduction goals, and helped shepherd an RNG bill through the New Hampshire legislative process. families are
Suffice to say at UNITIL, we execute on our goals and strategies with excellence.
Ending now on slide 14, it's been a busy and successful year thus far, and we're encouraged with the company's results and we're excited with what lies ahead.
We are better able than ever to execute our plan, strengthen the company, and provide sustainable long-term value for our shareholders. The plan is to provide sustainable long-term value for our shareholders.
So with that, I'll turn it back over to Todd.
Great, thanks Tom. I've wrapped up the material in this call. Thank you for attending. I will now turn the call over to the operator who will coordinate questions.
Thank you. Thank you.
Please stand by while we compile the Q&A roster.
And today's first question will come from Cody Clark with Bank of America.
Thanks for taking my questions.
Morning.
Good morning. First wondering if you can talk a little bit more about how you're thinking about RNG legislation and New Hampshire. Can you frame the potential investment opportunity for us? And also just for timing, is there any rule making that needs to take place or would you just look for pre-approval on any projects there?
Hey Cody, this is Bob, thank you for the question.
In terms of the opportunities, we are looking at certain projects. They're still in the early stages of review. As we've mentioned in the past, our perspective principally has been one of supply. We're looking at RNG as a means of decarbonizing our supply. We're very pleased with the legislation because we'll be able to do just that.
Now an important part of the legislation is the ability to include investments in rate-based investments needed to produce, transmit the R&G. Of course, all of that would be subject to regulatory approval. So as we go through the process, we're considering both perspectives.
whether we can look at RNG simply as a way of decarbonizing the supply, which of course is very important to us from a sustainability perspective.
But we are also looking at whether, under the new legislation,
whether there are opportunities to make investments and to put those investments in rate-based.
To the second part of your question, it will go through a regulatory process, any investment that we wish to put in rate base, as well as any
supply.
changes that we wish to make under the legislation.
They all are subject to the traditional public interest standards of review, but we're very comfortable with those. And again, given our familiarity and work on the legislation, we feel confident that if we bring both a supply proposal and an investment proposal that will have a very good chance of having them approved.
Got it, thanks for that thought and on inflation here, can you give us an update on how that ties into both your near term and long term outlook? I.E. how do you see it cascading through the capital plan and O&M budget? And also if you can just speak to a little bit of the cadence on significant contracts or labor arrangements that would be expiring, that would be very helpful.
Sure, Cody, this is Tom. In terms of some of the strategic projects that we currently have underway, including RNG, as I think we've mentioned in the past, we don't currently reflect those in our investment outlook.
So, we will plan to do so once we believe we have committed projects that we're pretty certain will move forward and will gain regulatory approval.
So in, you know, this year or next year, you may start to see some of these projects layered into our capital plan, but in terms of our current outlook, you're not reflected.
In terms of the 2nd, part of your question, I think you're referring to to labor contracts that we may have. You know, both this year and in future years. We have, I believe 6 labor unions between the 3 states that we. Negotiate contracts for and realistically, there tends to be 1 almost every year. They're dispersed over time. We try to stagger.
The, the term of those projects to make sure that there is only 1 in any given year. And we did have 1 that we successfully negotiated this year. I believe it was ratified just a month or 2 ago. And if you're asking about the, the impacts in terms of the current labor market and inflation. I believe that contract included 3 year annual general wage adjustments over the 5 year term 3%.
Understood and just 1 last question for me curious if you can talk on any. Of the potential implications from the inflation reduction act, the file fuels credit seems intriguing given some of your earlier commentary around the. But I'll try to leave it open ended there and you all can take it where you see fit.
Sure, I mean, we're obviously still studying the package and still trying to understand the specific provisions, you know, including any adders and how they might apply to specific projects that we have underway. But based on preliminary analysis or preliminary review, I should say, you know, it appears that the package of incentives for solar, biogas and RNG, energy storage, electric vehicles.
would all be supportive to many of our ongoing strategies.
So while we haven't yet gotten a handle on how everything might apply, we see, you know, essentially that those incentives would be beneficial to the economics of the projects that we're already pursuing. So generally we see upside from that package and really don't see any downside.
Thanks so much for the time, Tom, Bob, and Todd. Talk to you all soon.
Thanks Codey.
As a reminder, if you have a question, please press the star 1-1 key on your touchtone telephone.
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Good day and welcome to the Q2 2022 Unitil's earnings conference call.
At this time, all participants are in a listen only mode. After the speaker presentation, there will be a question and answer session.
To ask a question during the session, you will need to press star 1 1 on your telephone. Please be advised that today's conference is being recorded.
I would now like to hand the conference over to your speaker, Mr. Todd Diggins.
Director of Finance. Please go ahead, sir.
Good morning, and thank you for joining us to discuss Unitool Corporation's second quarter 2022 financial results. Speaking on the call today will be Tom Meissner, Chairman, President and Chief Executive Officer, and Bob Hebert, Senior Vice President, Chief Financial Officer and Treasurer.
We will discuss financial and other information on this column.
As we mentioned in the press release announcing this call, we have posted information, including a presentation, to the investor section of our website at Unitil.com. We will refer to that information during this call.
Moving to slide two, the comments made today about future operating results or events are forward-looking statements under the safe harbor provisions of the Private Security's litigation reform act of 1995. Forward-looking statements can certainly involve risks and uncertainties that can cause actual results to different material, materially from those predicted.
Statements made on this call should be considered together with cautionary statements and other information contained in our most recent annual report on Form 10-K and other documents we have filed with or furnished to the Securities and Exchange Commission.
Board-looking statements speak only as of today and we soon know obligation to update them.
This presentation contains non-GAAP financial measures. The accompanying supplemental information more fully describes these non-GAAP financial measures and also includes a reconciliation to the nearest GAAP financial measures.
The company believes these non-GAAP financial measures are useful in evaluating its performance.
With that, I will now turn the call over to Chairman, President, and CEO Tom Weiser.
Great, thanks Todd. Good morning everyone and thank you for joining us.
Beginning on slide 4, today we announced net income of 4.9 million, or 30 cents per share for the second quarter of 2022.
Through the first half of the year, net income was 26.4 million or $1.65 per share.
This represents an increase of 21 cents per share over the same six month period of 2021, supported by higher adjusted gross margins in successful rate case outcomes.
Both our electric and gas operating companies in New Hampshire received orders from the Public Utilities Commission, bringing a successful conclusion to the rate case process.
These rate cases were an important part of our overall regulatory strategy and achieved favorable results for all stakeholders.
The comprehensive settlements that were reached demonstrates the productive relationships we have with all parties involved.
With the completion of these rate cases, the majority of our distribution revenues are now decoupled, helping stabilize future results.
With that, we once again reaffirm our guidance that EPS growth will be above the upper end of our long-term guidance of five to seven percent, both this year and again in 2023. In the last two months of the year, we have a new guidance that will be above the upper end of our long-term guidance of five to seven percent, in 2023.
Moving on, sustainability is a guiding principle for us, and I'd like to know that our company-wide initiatives are progressing well.
In New Hampshire, I mean, in addition, in New Hampshire, we recently helped pass legislation that allows up to 5% of our gas supply to be sourced with renewable natural gas, along with the recovery of and return on any associated investment.
I'd also like to remind everyone that New Hampshire passed legislation in 2021 that prohibits towns and municipalities from restricting a consumer's choice and how they power and heat their homes, including the use of natural gas and other fuels.
This illustrates that legislators in New Hampshire understand that natural gas has an important role to play for many years to come.
We're pleased with this progress and look forward to sharing further details as we investigate RNG opportunities.
Moving now to slide five, I'd like to provide additional information regarding the rate case outcomes in New Hampshire, which we view is very positive.
We introduced these rate case violins and our regulatory objectives over a year ago, and now we believe we've delivered as promised.
Despite the significant attention on higher commodity prices and the impact high supply costs might have on utilities ability to recover costs.
We believe that we've successfully navigated those waters and secured awards that will contribute to our success in the coming years. In the coming years.
Beginning with Unitel Energy Systems, a distribution revenue increase of 5.9 million became effective on June 1st with fully decoupled rates.
Time of use rate structures were also approved that support our vision for electric vehicle adoption and electrification efforts.
Lastly, the first of two step adjustments for recovery of non-growth investments was recently approved in a separate docking.
At Northern, a distribution revenue increase at 6.1 million became effective on August 1st with fully decoupled rates.
In this case, a return on equity of 9.3% with an equity layer of 52% was agreed to in settlement in approval to the commission.
Similar to unital energy systems, recovery of non-growth investments is pending and will be approved in a separate docket. We expect approval of that rate increase shortly.
With the completion of these two cases, effectively 100% of our electric customers and 60% of our gas customers are now decoupled.
This represents a significant increase in both customer groups and brings the total number of customers under decoupling up to about 82%. We see this increase in decoupling is stabilizing our top line revenues, which will lead to more stable cash flows.
This will also benefit our customers who should see less volatility in their bills regardless of changes in use.
Turning now to slide six is outlined in last quarter's call. We continue to see impressive growth in the main and New Hampshire Seacost regions.
That growth is illustrated by New Hampshire's record low unemployment rate of 2%.
Billions in construction is currently planned or underway and this investment is expected to add new jobs, customers, and to spur further economic development.
The bulk of this development is occurring in our main service areas with over 5.3 billion and planned investment.
This growth is reflected in both construction employment and the number of building permits being issued.
Portland Maine, which is the largest city north of Boston, has about 1.4 billion of planned housing, commercial and mixed use development.
This development will continue to enhance the areas of the
Two major projects known as Rock Row and the Downs, each sizable project spanning hundreds of acres are currently underway and will feature community themed residential and commercial elements that are designed to harmonize and support each other.
These projects, which are already in the construction, will provide the company with considerable long-term growth opportunities.
Similar development is occurring in New Hampshire with a large campus-style project under construction in Salem that will continue to drive customer growth.
Well, these projects are among the largest currently underway. They represent a relatively small portion of long term growth opportunities. We see in our service areas.
We are looking forward to supporting that road for years to come.
Turning to slide 7, in addition to economic development, other opportunities continue to play out for our natural gas division as well.
As I've discussed in the past, Maine and New Hampshire, the predominant heating fuel is oil, which is both less clean and less affordable than natural gas.
With a penetration rate of approximately 60% on our gas mains, we expect the price and environmental advantages of natural gas to drive low-cost customer conversions for years to come.
While electric heat pumps provide a great solution in many parts of the country, they are not sufficient to heat most homes during the coldest New England winter days when their maximum output is dramatically reduced.
Natural gas, whether it's the sole heating source or in combination with electric air source heat pumps, continues to be the most economical heating source.
Another way to think about the importance of our natural gas system is the amount of energy delivered relative to our electric system.
Despite having almost 25% more electric customers, we deliver about four times more energy through our gas infrastructure than our electric systems on an annual basis. It's been up to seven times more energy during the winter months. It's been up to seven times more energy during the winter months.
The gas system is fully capable of delivering this amount of energy while maintaining both reliability and affordability.
For the electric system to deliver the energy needed for heat pumps or electric vehicles, it is likely that significant investments will be required.
With that, I'll now pass it over to Bob who will provide greater detail on the quarterly endear to date results.
Thank you, Tom, and good morning, everyone.
I will begin on slide 8.
As Tom noted, today we announced second quarter earnings of $4.9 million, or 30 cents per share
On a year-to-date basis, net income increased by $4.8 million, or 21 cents per share, compared to the same period in 2021.
That strong growth is the result of higher sales margins, supported by successful New Hampshire rate case results, partially offset by higher operating expenses.
As a reminder, in the third quarter of 2021, we reported break-even earnings and expect similar results in the third quarter of 2022.
As Tom noted, for the full year, we continue to expect earnings growth above the upper end of our 5% to 7% range.
Turning now to slide 9, I will discuss our electric and gas volumes and margins.
Starting with electric operations.
For the six months ended June 30th, 2022, electric adjusted gross margin was $48.2 million, an increase of.2 million compared to the same period in 2021. An increase of.2 million compared to the same period in 2021.
The increase in electric margin reflects higher distribution rates and customer growth, partially offset by cooler early summer weather.
Commercial and industrial unit sales increased 1.2% and customers increased by 490 or 1.5% over the first half of 2021.
Reflecting customer growth in both the residential and commercial classes.
moving to gas operations.
For the six months ended June 30th, 2022, gas-adjusted gross margin rose $80.2 million, an increase of 7.4 million, or 10.2% relative to the same period of 2021.
The increase in gas margin reflects higher rates, customer growth, and colder winter weather.
Unit sales were up 3.3% or about 0.9% on a weather normalized basis.
Going forward with a significant portion of sales now under decoupled rates, the effect of weather will be significantly moderated.
Moving now to slide 10, we provide an earnings bridge comparing year-to-date 2022 results to 2021.
As discussed, year-to-date 2022 adjusted gross margin increased to combine $7.6 million, principally as a result of higher distribution rates, customer growth, and colder winter weather. Operating and maintenance expenses increased to $2.4 million, largely due to higher labor costs and professional fees.
partially offset by lower utility operating costs.
Depreciation and amortization increased by $0.6 million, reflecting higher levels of utility, plant and service, partially offset by lower depreciation rates resulting from the rate case order received for the company's electric distribution subsidiary in New Hampshire. Taxes other than income taxes increased by $1.1 million, reflecting higher local property taxes on higher utility, plant and service, and higher payroll taxes.
Interest expense decreased $0.5 million due to lower interest on long-term debt, partially offset by higher interest on short-term borrowings. $0.5 million due to lower interest on long-term borrowings.
Other expenses decreased by $1.1 million, largely due to lower of retirement benefit costs.
Lastly, income taxes increased $0.3 million as a result of higher pre-tax earnings in the period, partially offset by the flowback of excess accumulated deferred income taxes under regulatory orders received in New Hampshire.
Slide 11 provides an overview of our investment outlook, which totals about $755 million over the coming five years. Slide 11 provides an overview of our investment outlook, which totals about $755 million over the coming five years. Slide 11 provides an overview of our investment outlook, which totals about $755 million over the coming five years. Slide 11 provides an overview of our investment outlook, which totals about $755 million over the coming five years. Slide 11 provides an overview of our investment outlook,
These investments will ensure the safety and reliability of our distribution system, enable system growth, advance our grid modernization initiatives, and enhance our customers' experience.
Overall, we anticipate long run annual rate base growth in the range of six and a half to eight and a half percent, with our investment mix becoming increasingly balanced between gas and electric operations.
As we've noted in the past, there remains potential upside to the capital investment forecast.
Now I'm turning to slide 12.
Our dividend increases in 2022 have been greater than prior years, reflecting our confidence in our strategic plan and in our ability to execute the plan.
On a trailing 12 month basis, our payoff ratio has been 60% squarely within our target range.
Looking forward, we will continue to evaluate further accelerating our dividend growth consistent with our target payout range and earnings growth.
And with that, I will turn it back over to Tom.
Thanks, Bob.
Slide 13 provides a recap of some of the key objectives we had laid out in prior calls and our success in achieving them.
We continue to earn well on invested capital and reaffirm our long-term earnings growth of 5 to 7%
In 2022, we are on pace for earnings growth will exceed the high end of the long term range.
Our target dividend payout ratio remains at 55 to 65%, and we have successfully moved our payout ratio into that range, patiently lowering it over the last several years.
We filed and settled two rate cases, which addressed many key initiatives, including revenue decoupling.
Operationally, our goal is to be an industry leader in customer service, customer and employee safety, and system reliability, and we think we're doing just that.
Finally, in 2019, we published our first sustainability report and reaffirmed our commitment to corporate responsibility. In reaffirmed our commitment to corporate responsibility.
Since then, we followed through with continued status reports, carbon reduction goals, and helped shepherd an RNG bill to the New Hampshire legislative process. I used to attend those specifically to the New Hampshire
Suffice to say at UNITIL, we execute on our goals and strategies with excellence.
Ending now on slide 14, it's been a busy and successful year thus far and we're encouraged with the company's results and we're excited with what lies ahead.
We are better able than ever to execute our plan, strengthen the company, and provide sustainable, long-term value for our shareholders.
So with that, I'll turn it back over to Ton.
Great thanks Tom. I've wrapped up the material in this call. Thank you for attending. I will now turn the call over to the operator and coordinate questions.
Thank you. As a reminder, to ask a question, you will need to press star 1 1 on your telephone.
Please stand by while we compile the Q&A roster.
And today's first question will come from Cody Clark with Bank of America.
Okay, good morning. Thanks for taking my questions.
Morning, coach. Good morning, coach.
Good morning. First wondering if you can talk a little bit more about how you're thinking about RNG legislation and New Hampshire. Can you frame the potential investment opportunity for us and also just for timing? Is there any rule making that needs to take place or would you just look for a pre-approval on any project there?
Hey Cody, this is Bob. Thank you for the question.
In terms of the opportunities, we are looking at certain projects. They're still in the early stages of review. As we've mentioned in the past, our perspective principally has been one of supply. We're looking at RNG as a means of decarbonizing our supply. We're very pleased with the legislation because we'll be able to do just that.
Now an important part of the legislation is the ability to include investments in rate-based investments needed to produce, transmit the R&G. Of course, all of that would be subject to regulatory approval. So as we go through the process, we're considering both perspectives.
whether we can look at RNG simply as a way of decarbonizing the supply, which of course is very important to us from a sustainability perspective.
But we are also looking at whether, under the new legislation,
whether there are opportunities to make investments and to put those investments in rate base.
To the second part of your question, it will go through a regulatory process, any investment that we wish to put in rate base, as well as any...
It will go through a regulatory process, any investment that we wish to put in rate base, as well as any supply.
changes that we wish to make under the legislation.
They all are subject to the traditional public interest standards of review, but we're very comfortable with those. And again, given our familiarity and work on the legislation, we feel confident that if we bring both a supply proposal and an investment proposal that will have a very good chance of having them approved.
Got it, thanks for that thought. And on inflation here, can you give us an update on how that ties into both your near term and long term outlook? IE, how do you speak at test dating through the capital plan and ONM budget? And also if you can just speak to a little bit of the cadence on significant contracts or labor arrangements that would be very helpful. Thanks.
Cody, this is Tom. In terms of some of the strategic projects that we currently have underway, including RNG, as I think we've mentioned in the past, we don't currently reflect those in our investment outlook.
So we will plan to do so once we believe we have committed projects that we're pretty certain will move forward and will gain regulatory approval.
So, in this year, or next year, you may start to see some of these projects layered into our capital plan. But in terms of our current outlook, they're not reflected.
In terms of the 2nd, part of your question, I think you're referring to to labor contracts that we may have. You know, both this year and in future years. We have, I believe 6 labor unions between the 3 states that we. Negotiate contracts for and realistically, there tends to be 1 almost every year. They're dispersed over time. We try to stagger the term of those projects to make sure that there is only 1 in any given.
Okay, got it. Yeah, and understood on the fact that some of these incremental opportunities are not reflected in the CAPEX budget. It was more just a question around core CAPEX inflation and what you're seeing there, but understood there.
Oh, I see, you know, internet of that, I think we're seeing what everybody's seeing.
Understood. And just one last question from me. Curious if you can talk on any of the potential implications from the Implacement Reduction Act, the biofuels credit seems intriguing, given some of your earlier commentary around RNG, but I'll try to leave it open and end it there when you all can take it where you see fit.
Sure, I mean, we're obviously still studying the package and still trying to understand the specific provisions, including any adders and how they might apply to specific projects that we have underway. But based on preliminary analysis or preliminary review, I should say, you know, it appears that the package of incentives for solar, biogas and RNG, energy storage, electric vehicles, would all be supportive to many of our ongoing strategies.
So, while we haven't yet gotten a handle on how everything might apply, we see essentially that those incentives would be beneficial to the economics of the projects that we're already pursuing. So, generally we see upside from that package and really don't see any downside.
Got it. Thanks so much for the time. Tom Balvin-Tad. Thank you all for your time.
Thanks for joining me. Godtestsoverely. Thanks for joining me.
Thank you. As a reminder, if you have a question, please press the star 11 key on your touch-tone telephone.
I am showing no further questions at this time. Ladies and gentlemen, this concludes today's conference call. Thank you for participating. You may now disconnect.