Q2 2022 Wynn Resorts Ltd Earnings Call
Welcome to the Wynn resorts second quarter 2022 earnings call. All participants are in a listen only mode until the question and answer session of today's conference to ask a question Press Star one on your Touchtone phone record your name and I will introduce you.
He's limit yourself to one question and one follow up question. This call is being recorded if you have any objections you may disconnect. At this time I would now like to turn the line over to Julie Cameron Doe Chief Financial Officer. Please go ahead.
Thank you operator, and good afternoon, everyone.
With me today are Craig billings.
In Las Vegas.
Also in the mine and Ian Coughlan, Linda Chen.
So Charles and Jenny holiday.
I want to remind you that we may make forward looking statements under the federal Securities laws and those statements may or may not come Shane I will now turn the call over to Craig.
Thanks, Julie afternoon, everyone.
Thanks for joining us today before getting into the quarter I'd really like to thank our 27000 team members globally.
2022, so far has been very different in Macao than it has been in North America, our folks into Cal have endured what I know is a difficult period of isolation and volatility while our teams in Las Vegas, and Boston have responded admirably to meaningfully elevated business volumes.
So those operating in both circumstances. Thank you I appreciate you.
Starting in Las Vegas, the team at Wynn Las Vegas turned in another all time record quarter with $227 million of EBITDA and broad based strength across casino hotel food and beverage and retail all well above <unk> 2019 levels in fact, our EBITDA this quarter was over 40% above the pre COVID-19 Las.
Biggest strip EBITDA record also delivered by Wynn Las Vegas in 2014.
A few other all time quarterly records to callout record EBITDA margin record slot handle and win record non baccarat table win record hotel revenue and record revenue from restaurants and bars. Meanwhile.
Meanwhile, our customer satisfaction satisfaction scores in the first half of 2022 were up 3% over the first half of 2019, our performance in Las Vegas speaks for itself.
Looking ahead, while we are keenly aware of the macro environment and the uncertainty facing the economy.
Been encouraged that the strength, we have experienced over the past several quarters has continued into Q3 and.
In fact, our forward bookings continue to pace at pre COVID-19 levels on substantially higher ADR.
July was very strong for us with occupancy of 91%, we expect the usual seasonal slowdown in August with occupancy declining into mid to high Eighty's before accelerating back to the low Ninety's in September as group's return in large numbers.
While we haven't seen any noticeable signs of weakness in our current operations or in our outlook. We are watching this closely our experienced during the pandemic has made us a nimbler than ever and we are confident that we can adapt quickly to changes in the economic landscape should they arise.
Turning to Boston Encore also had a great quarter generating $64 million of EBITDA are second quarter records for the properties, we saw strength across the casino with record gross gaming revenue and on the non gaming side, we generated record hotel revenue with particular strength in cash ADR and occupancy.
The positive momentum has continued into Q3 and again similar to Las Vegas, we have yet to see signs of a slowdown.
We were happy to see mass the Massachusetts legislature passed a sports betting bill and having already constructed a sports book at Encore Boston Harbor in 2021, we expect that retail sports betting will soon be a significant opportunity for property wide customer acquisition in Boston.
We also continue to finalize our plans for our upcoming development projects across the street from the property that will add incremental parking suite and beverage and entertainment amenities design and planning for that project is on schedule and we are excited for our next phase of growth in Boston.
In Macau the market continues to be very difficult with market wide GTR in July only reaching approximately 2% of July 2019 levels.
Our results have reflected that enroll drop hotel occupancy and EBITDA.
Overall, our EBITDA loss in Q in Q2 was $90 million, which was negatively impacted by around $8 million from low VIP holds and.
So on a normalized basis, our EBITDA loss was 900000 per day in <unk> and despite the nearly two week market wide casino closure in July our EBITDA loss has been comparable at approximately 1 million per day quarter to date in Q3.
Our team has done a fantastic job controlling costs in a very challenging operating environment through a combination of decreases in payroll and fixed opex.
Several weeks ago, we announced some important leadership changes in Macau with Linda Chen moving into the role of President early next year, Frederick Loewe Suto moving into the role of CFO for the entire Macau business and Craig Hello, I'm, assuming the role of CFO and CIO for the business.
I know many of you know and as I do respect and immensely. So I'm pleased that he will remain at the company in an advisory role through 2023.
Haven't mens confidence and Linda Frederic and Craig and know that they are the right team for the future.
The authorities in Macau continued to advance the concession process. According to the pre established timeline.
We're currently working through our response to the concession tender RFP.
Longer term, we remain excited about the prospects for Macau was so much pent up demand for travel and tourism in Asia.
Our market, leading assets and strong liquidity position us well to thrive as visitation returns to the market over time.
At Wynn interactive the strategy, we implemented late last year to manage the business with a long term shareholder friendly view is working with our overall EBITDA burn rate declining to $21 million in Q2 from $32 million in <unk>.
Despite a 3% quarter over quarter decline in total turnover due to the seasonally weak second quarter sports calendar.
We are looking forward to the potential for a significant catalyst for win back and massive Massachusetts, both in digital and retail sports betting.
Lastly, the design and programming for our project in the UAE are really coming along and I grow more excited about the opportunity every day.
The project's parking along a beautiful white sand beach will contain a 200000 square foot casino and extensive food and beverage portfolio and numerous forms of entertainment and spectacle.
The more time I spend in this project the more I am convinced in our ability to build robust gaming and non gaming businesses.
With that I'll now turn it over to Julian to run through some additional details on the quarter Julie Thank you Craig.
At Wynn Las Vegas, we generated an all time quarterly record $226 7 million.
Of adjusted property EBITDA on $561 1 million in operating revenue during the quarter higher than normal hold positively impacted EBITDA by around $6 million.
Q2.
Total occupancy with 95% in the quarter up 40 basis points versus Q2 2019.
Fortunately, we stay true to our luxury brands and continue to compete on quality of product and service experience with our overall ADR, reaching $460. During Q2, 2020% to 38% above Q2, 2019 levels or other non gaming businesses saw broad based strength across food and beverage.
Retail, which will also well above pre pandemic levels.
In the Casino Q2, 2022 slot handle was 63% above Q2, 2019 levels and on table drop was 28% above Q2 2019 levels.
<unk> still suppressed international play during the quarter due to COVID-19 related travel challenges.
The team in Vegas has done a great job of controlling costs without negatively impacting the guest experience delivering adjusted property EBITDA margin of 43, 4% in the quarter on a hold normalized basis, our EBITDA margin without Covid 1200 basis points compared to Q2 2019.
Opex, excluding gaming tax per day with $3 $5 million in Q2 2022 in line with Q2 2019 levels. Despite a 21% increase in revenue due to lower head count and broad based cost efficiencies in areas that do not impact the guest experience.
Remain committed to maintaining a cost structure that appropriately balances margins on our exacting standards.
In Boston, we generated adjusted property EBITDA of $63 $7 million in Q2, 2022 with EBITDA margin of 33%. We saw broad based strength across casino are non gaming.
The casino, we generated $191 million, a CTO of property record with strengths across both tables and slots.
Non gaming revenue grew 78% year over year with particular strength in the hotel driven by 94, 1% occupancy and a 391 dollar ADR as Craig noted earlier Q2 strength continued into Q3 as consumer spending on unique experiences remain strong with states.
So disciplined on the Cogs side with Opex, excluding gaming tax per day of approximately $1 1 million.
In Q2 2022. This is a decrease of approximately 13% compared to $1 $3 million per day in Q4, 2019, and up modestly relative to Q1 2022 on higher revenue and higher payroll as.
As we've previously foreshadowed contractual labor agreements added around $45000 per day to our Opex base beginning late in the quarter.
We are well positioned to drive strong operating leverage as we continue to grow the top line over time.
Our Macau operations delivered an EBITDA loss of $93 million in the quarter on $117 $2 million in operating revenue.
Covid situation in the region has continued to suppress the visitation as CRO.
Noted lower than normal VIP hold negatively impacted our EBITDA by over.
Around $8 million during the quarter.
Businesses remain challenging into Q3 as local Covid outbreaks in Macao drove a shutdown of integrated results for nearly two weeks during July .
Finally at the close of our quarter to date EBITDA was approximately $1 million per day in line with Q2.
Our opex, excluding gaming tax was approximately $1 $9 million per day in Q2, a sequential decrease compared to $2 1 million in Q1 2022.
The team has done a great job remaining disciplined on costs in a difficult operating environment.
Longer term, we are well positioned to drive strong operating leverage as the business recovers over time.
Turning to win interactive in Q2, the business generated approximately $704 million in total turnover a decline of 3% sequentially versus Q1 due to a seasonally weak as both calendar.
Decreases in marketing spend and other opex drove an improvement in our EBITDA run rate to $21 million in Q2, 2022 from $31 $5 million in Q1 2022.
Moving onto the balance sheet, our liquidity position remains very strong and global cash and revolver availability of approximately $3 $1 billion as of June 30th.
This was comprised of $1 $3 billion of total cash and available liquidity in Macau.
And $1 $7 billion in the U S.
This excludes the $500 million intercompany revolving credit facility. When result entered into with Wynn, Macau, which further bolsters our already strong liquidity position in Macau and highlights the continued confidence we have in the long term prospects for that business.
Our previously announced sale leaseback transaction for the real estate of Encore Boston Harbor remains on track for a Q4 close pro forma for the transaction, we have approximately $4 7 billion.
Our consolidated global cash and liquidity.
Importantly, the combination of very strong performance in Las Vegas, and Boston with the properties generating trailing 12 months EBITDA at just over $1 billion together with our robust liquidity creates a very healthy pro forma domestic leverage profile.
Finally, our capex in the quarter was $90 million.
I'm not really related to the Wynn Las Vegas room, remodel and essential renovations.
With that we'll now open up the call to Q&A.
Okay.
Thank you to ask a question press star one on your Touchtone phone on mute your phone record your name clearly after the prompt and I will introduce you for your question. Please limit yourself to one question and one follow up question to withdraw. Your question you May Press Star two our first question comes from Carlos <unk> with Deutsche Bank you May.
Go ahead Sir.
Everyone. Thank you.
Guys, obviously, the booking pace on Bruce group remains pretty solid in Las Vegas, and clearly there's a lot of pent up demand for that with the experience of now taking on bookings and hosting groups in the new facility as you guys look out to 2023.
What what do you believe to be kind of a tailwind from a an occupied room night perspective, or an occupancy perspective.
As well as perhaps what impact that might have on kind of the margin profile of the property with the presumably added occupancy.
Thanks Carlo.
It's definitely true that group continues to continues to be strong and I'll ask Brian to talk about pacing and just a second as we've talked about on prior calls we did have.
Some legacy group rooms.
I think everyone in the market would.
Some contracts books booked in prior years that were at lower ADR.
And obviously.
Obviously, signing new contracts at higher ADR switch as they roll in we'll we'll offset that.
From an occupied room night perspective, I mean, we're running very healthy occupancy today. So I don't I don't think it would change overall occupancy, but obviously it does mix, Brian do you want to talk about pacing a little bit sure.
Sales team here at Wynn Las Vegas continues to just do an outstanding job builds.
Building, a really strong base of business for our future. The second half of 'twenty two that we're into now.
Head of pace at 'twenty, three we see quite strong.
Just to give you a bit of sense of how we're doing the cumulative group bookings in the first half of 'twenty. Two we're 40% above the first half of 19. So the team just continues to build that solid base from which I think we can effectively yield manage our rooms better next year.
And as we move into the future.
Great. Thank you and then just as you think about that group room night as it pertains to 2023.
Acknowledging you know other than our first quarter, which was a little a little lighter from an occupancy perspective, but 90% in this quarter.
Who does that customer.
Plant next year is that are you still getting a healthy or at least a tangible amount of rooms through otas and third party channels right now or who is kind of being replaced I assume it's likely not the casino customer.
<unk>.
It's a great question Carlo we've already scaled back our allocation to.
Some of the lower profitability channels Thats, obviously, the first thing you do anytime youre your yield managing and it's a little bit of a rich man's problem now as we as we think forward because we have a very healthy casino business as you saw in the numbers and we have a very healthy group business So were atul.
Attuned to how we optimize that mix and we will be we'll be doing that over the course of the next couple of quarters. So stay tuned on 'twenty three but we recognize.
Loews Hollywood issue, it's actually an opportunity we recognize the opportunity and we will take advantage of it.
Great. Thanks, everybody.
Karla.
Thank you our next caller is Joe Greff with J P. Morgan.
Hey, everybody two questions one.
Another similar question on group in Las Vegas.
When you look at it next year.
Great.
What are you targeting in terms of percentage of room nights related to the group segment and then how much of that is on the books now and how much of the strategy in.
In the period for the period going forward on group given the seemingly.
Upward movement in ADR around group.
Brian you want to take that sure.
As we look at it right now we're pacing to a normal percentage of around roughly 30%.
Continue to excel as far as where we are for next year.
We're slightly ahead of where we should where we normally are so we're very confident that we'll hit the number we need to add it continues to contribute to our bottom line a base and those new bookings, particularly for.
For new customers in the out years are at a substantially higher ADR.
Great.
One thing that's it.
Maybe surprised us.
Looking at your earnings release Tonight, Craig was.
The buyback activity can you talk about.
That and how much of your capital allocation going forward is going to be buyback activity, assuming share price levels at or around.
At these levels.
Joe you know as you've been following us for years and you know that we're not programmatic about buybacks, we repurchased stock when we think it is ridiculously cheap and during Q2 that was certainly the case, particularly from mid may through the end of the quarter. So we're always balancing liquidity needs capital deployment and for growth and returning capital to shareholders.
The wildcard, let's be honest the wildcard as Macau, so as we get better visibility on Macau over time.
<unk>.
We can have more confidence.
Confidence in each particular form of capital deployment and know that we can do them concurrently.
Thank you.
Thank you. Our next caller is Shaun Kelley with Bank of America, you May go ahead.
Thank you very much.
Hi, I just wanted to sort of ask about the trends in Las Vegas, a little bit more color on just the trajectory of what youre seeing on the casino floor relative to the hotel could you just maybe help us think about as we get into some of the tougher.
Comps on the growth that we've seen in casino what are some of your expectations around trends or what maybe driving that growth I know market share gains maybe on the slot side has been.
But maybe pros cons on casino grows and then like I said, we've already talked about hotels. So just more on the on the <unk> line.
Sure I'll start and then.
And then Brian will jump in so this started really back in 2019, so you've heard us talk about before our reconstitution of our database strategy.
We made a bunch of changes in and hosting we launched wind rewards so really going into the reemergence from Covid, we had reoriented, our casino strategy and I think it shows at the same time, we've been very relentlessly and reinvesting in the property in Las Vegas.
Despite COVID-19.
In the rooms, and food and beverage and amenities and it shows and customers notice and so yes. We are we are taking share and I'm incredibly proud of the team for doing that Brian do you want to give a little bit of incremental color qualitatively on.
On July .
When you look at what we've done in July we actually what the host team and the marketing team and casino segments focused on really expanding into markets that we haven't been in before reach.
Reaching further into domestic segments that we are seeing great returns on.
And.
Year over year, both dropped and handle are significantly up I couldn't be happier with the team right now and they continue to just continue to push.
With special events and driving weekends.
Just a great balance right now and we're going to continue to do more of it and Shaun we acknowledged trees don't grow to the sky.
You are seeing this in all your Las Vegas names, but as I said in my prepared remarks, we watch the data daily right. We don't have to look in Las Vegas, We don't have to look after 10 properties. We look after one and we know everything that's going on in this building and as I mentioned in my prepared remarks, we don't we don't see floater.
Florida.
So that's where we are.
Really encouraging and then my follow up.
Not so much about slowdown, but just about maybe traditional seasonality a little bit here right to historically.
I think the properties tend to do a little bit better in the first half the net and then second you know, especially in the third quarter can you help us just think about that.
How those patterns may shape up for the balance of the year, because we are hearing a little bit more from the.
The broader lodging industry it out.
A return to more normal seasonal behavior.
Just any any comment that you could think about just to just to make sure. We're in the right place for seasonal purposes sure Youre right August is usually pretty weak in Las Vegas, I think that's probably true.
Or I should say pretty weak relatively weak, particularly given the.
Given the quarter that we've just experienced so August is usually a pretty slow month groups come back in September and you start to see an increase in occupancy I talked about the occupancy shifts that we would expect over the course of Q3.
In my prepared remarks, and we stand by that so.
Business is good in fact, it's really good but you always see seasonality in the quarter you can go back and look at historical Q2 to Q3.
Movement from an EBITDA perspective in percentage terms, and I think youll see that seasonality.
Very helpful. Thank you.
Thank you. Our next caller is David Katz with Jefferies. You May go ahead.
Hi afternoon, Thanks for taking my questions.
I was hoping for some insight around interactive.
Given that Massachusetts is moving forward.
Do observe out there.
Was a little bit of movement.
The loss in the quarter.
What are your updated thoughts there.
Would the burn go up a bit given the Massachusetts comes an opportunity on home turf.
It will take at all thanks.
Sure no problem so.
Beginning I think with our Q3 call defense last year.
<unk> talked a little bit about what we're seeing in the market and some of the irrationality that we were seeing in the market I can say that that has markedly declined.
And that's encouraging so.
To see other players in the market behaving reasonably well, it's great for us.
Massachusetts, I've said this before Massachusetts was always an important boot strapping event.
For for win back and for when interactive as is any movement in gaming, which we obviously don't see at the moment, but.
But I am certainly will over the longer term.
Our goal is really to make sure that we are consistently running the business as best we can from a lifetime value to cost per acquisition perspective, So increase retention decreased CPA.
Increased handle per customer, but that's the way we run the business.
That has resulted in a declining burn overtime, which you've seen is each quarter has sequentially gone by as we told you.
That's where it could go up modestly with the launch of Massachusetts, because we will do some user acquisition I don't think it will ever be back in the position that we were in at the launch of last last NFL season, we've learned a lot in terms of which marketing channels work and which don't but the businesses. They are really executing in that portion of our business and we're watching them.
Market very very closely we will be in Massachusetts. They want.
Understood and if I can just follow up.
Does the promotional landscape that you noted.
Enable you to consider going back to other states, where you don't have a land based presence or re growing the business or should we really just be thinking about massachusetts for the moment.
Well, we are continuing to launch in additional states.
And we're continuing to set that set the foundation in place to grow that business over time as the Tam grows and as our business grows, but Massachusetts, obviously for obvious reasons, we have the land based presence there you've seen market share from.
Fellow market participants in places where they have.
Brick and mortar presence and it's obviously warrants prioritizing, Massachusetts.
Got it thank you very much.
<unk>.
Thank you. Our next caller is Dan <unk> with Wells Fargo. You May go ahead Sir.
Hey, good afternoon, everyone and thanks for taking my questions.
I just wanted to follow up on Las Vegas, obviously margins were really strong in the quarter I think your gaming mix at this point is back to 2019 level. So you know now that mix is basically normalize is there any reason to think that you wouldn't be able to sustain margins in that high 30 range going forward.
Well look we've.
We are generating we generated operating leverage all over the building over the course of really the past three or so quarters and I'm incredibly proud of the team for doing that if you look at our rates. If you look at what we've done in food and beverage really every nook and cranny, we've driven operating leverage so what youre seeing is really the.
<unk> not of agreed.
Aggressively reducing ftes or negatively impacting the customer experience.
Or other pricing.
And so we go is with that in mind, we go as pricing goes right and so you know I'm loath to.
Margin and.
And forecast, whether we can maintain a 40% margin an incredibly healthy margin because what we want do is got staffing and degrades the customer experience.
Even if there is a.
Modest recession, we just don't do that we're thinking about our brand over a 20 year term not over a quarter.
I'm loath to pin a particular margin, but what I can tell you is that the team here.
As very appropriately managing staffing were probably down about 10% from from pre COVID-19 levels, yet our customer satisfaction scores are up and we are pricing our product appropriately based on the quality of that product.
Got it and then just.
Just pivoting to interactive obviously, you guys have become a lot more rational the markets become more rational in terms of pricing.
Pricing and promotion and marketing as we think about where we go from here as we go into football season in the back end of the year, how should we think about your burn rate relative to that <unk> number.
Well, what we have consistently said is that we'll be driving down the burn each quarter now, Massachusetts as I mentioned earlier I think to David's question, Massachusetts could change that but I don't imagine it materially shifting so it's really kind of immaterial in the Grand scheme of things and so I wouldn't over I wouldnt spend a bunch of time in <unk>.
Just trying to forecast it.
The trend should be down with the exception of a few quarters that we might do some user acquisition in Massachusetts as the market opens.
Got it thanks for all the detail.
Got it.
Thank you our next caller is Brent <unk> with Barclays. You May go ahead Sir.
Hey, good afternoon, everyone. Thanks for taking my question. So in Las Vegas, I was hoping you could just talk about international inbound visitation and maybe walk us around the globe where you.
I think you have the most sort of mixed during normal times, we obviously have our assumptions, but if you could just walk us around the globe and talk about where you think youre going to see upside near term medium term long term and how much how much of upside we could we could sort of see here.
I'll start and then I'll pass it to Brian keep in mind there.
Are a lot of potential international visitors that have been unable to visit so we've been able we've been quite successful on the international front, despite that but that is a tailwind that we that we have Brian do you want to talk about.
Mix and opportunities.
Sure we've definitely seen a pickup in the international clients sell both in the gaming and non gaming side of our business, Obviously, Canada and Mexico are the first ones that have popped up we're seeing great traction in the UK now in fact.
Just came out of a meeting with ELV CVA and the lift out of London is actually at a 106% now of what it was in 2019.
Covid level, so it means U k's back.
The biggest opportunity for us moving forward is obviously China.
We're not seeing it.
It's anemic at this point and that's all based on what you all know down out there. So right now our biggest upside is China. We are seeing other Asian business come back, but not to the extent wed like so I'm optimistic about what's in the future and we got a lot of upside I think at some point.
Okay, great. Thanks for that and just if I could follow up on Macau.
Maybe you could just give us an update on your thoughts around the re tendering process.
Any any sort of.
Surprises or anything that you'd want.
Let us know about and an update.
I'll start and then I'll.
I'll ask Ian to provide his thoughts as well not really I mean, we understand and appreciate what Macao is trying to achieve.
Diversifying the market both in terms of the geographic origin of visitors.
And their motivations to visit is not a process that happens overnight.
And Vegas took many years and it was a concerted effort by both government and business. We were instrumental in leading that change here in Vegas, and we will of course continue to play our part in Macau journey to do the same.
Anything you would.
Would add in particular on the tender requirements.
I think the.
The rules that were issued.
Timeline, we're very clear we have saw some minor clarifications and were in the six week process of crystallizing, our responses, which will get submitted by all six operators on September 14, and then we go into a period of negotiation and I think the government's intent is purely.
Before the end of the year or two.
The successful operators.
Okay. Thanks, so much.
Got it.
Operator, we'll take one last question. Thanks.
Thank you and our final question comes from Robin Farley with UBS you May go ahead.
Great. Thanks.
Two things just to clarify that you you've talked about a little bit already one was just poor for group for 'twenty three.
Your booked position kind of room nights booked compared to 2019 at the moment for 'twenty three it sounds like there was a lot of acceleration in the first half and just wondering where that curve.
Hum.
For 'twenty three.
Right sure.
We are ahead of both 19, and obviously 'twenty one.
And we continue to pick up we're not going to need to pick up much in the year for the year.
As we are focused on moving forward with actually a higher number. So we will have we're hoping.
Highest number of group rooms, we've ever had because of the expansion of the Convention Center. We did a couple of years ago, So really starting to grow into that space and take advantage of it and it also allows us with a slightly larger base to yield a little bit better up our rates as we move forward into the year. So all are encouraging, but certainly better than 19% in 'twenty one.
Okay, great. Thanks, and then.
The other question is just on the Vegas margins that I know you talked about maintaining the guest experience at all of that.
How much of the margin increase do you think is sustainable.
I guess, you've you said in the past some previous calls that you don't have as many open positions maybe as some other vegas properties, but is there anything about the margin that you think is not sustainable or how would you guide us to expect that thanks.
Sure.
We learn to run the business differently in Covid, we've talked about this before I mean, we completely re evaluated how we do everything.
And so we are running I mentioned earlier on about 10% less ftes.
And then pre Covid and we're doing it in an absolute rager of a market.
And our customer satisfaction scores are going up so that's a real testament to the team.
So I would consider that at this point permanent.
The operating leverage that we were able to obtain out of the business units look room as you well know RIN prices fluctuate with supply and demand. So you can have positive operating leverage.
The deleveraging.
Deleveraging operating Leverages leverage.
In rooms.
<unk> notice on the food and beverage side I suspect some of it sticky I mean inflation is what it is and we've been able to drive a decent amount of operating leverage out of the food and beverage portion of the business. So it's a little bit of a mixed bag, but robin I guess, what I would say is the FTE count is.
Is what it is.
Okay, great. Thanks very much.
Okay, well with that we'll now close the call. Thank you everyone Im going towards talking to you again next quarter.
Thanks, everybody.
Thank you for participating on today's conference you may now disconnect.
Yeah.