Q3 2022 Vroom Inc Earnings Call

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 one on your telephone.

I'd now like to hand, the call over to Liam Harrington Vice President of Investor Relations. Please go ahead.

Thank you operator, good morning, everyone and welcome to Bruce third quarter 2022 earnings call.

Joining us on the call today are Tom short, Chief Executive Officer, and Bob Krakowiak, Chief Financial Officer.

Please note this call will be simultaneously webcast on the Investor Relations section of the company's corporate website at IR Dot group Dot com.

The third quarter 2022 earnings release and earnings presentation are also posted to the Investor Relations website.

Before we begin please note that the discussion today includes forward looking statements within the meaning of the federal Securities laws.

Including but not limited to stay.

Statements about rooms operations and future financial performance.

These and other forward looking statements are based on management's current assumptions and are neither promises nor guarantees.

And are subject to a number of risks uncertainties and other important factors that may cause actual results to differ materially.

We direct you to the company's most recent SEC filings, including the risk factors section of rooms. Most recent Form 10-K for the year ended December 31 2021.

As updated by our quarterly report on Form 10-Q for the three months ending September 32022.

For additional discussion of factors that could cause actual results to differ materially.

Please note further that todays discussion, including the forward looking statements speak only as of the date of this call and Vroom assumes no obligation to update such statements.

The company May also discuss certain non-GAAP financial measures during today's call.

You can find a presentation of the most directly comparable GAAP measures.

A reconciliation of those measures in the third quarter 2022 earnings release and management presentation.

I'd like to now hand, the conference over to Tom short Chief Executive Officer, Tom.

Thank you Lee and thank you to all the investors analysts roommates UAC colleague and third party partners, who are joining us today to discuss <unk> third quarter earnings.

Starting on slide three.

We introduced our long term roadmap at our May 26, Investor day, where we highlighted our mid term goal, which as a breakeven business and our long term goal of a 5% to 10% adjusted EBITDA margin business.

As we mentioned on Investor Day, we've made the choice to slow down.

We slowed down with the intent to continue improving our customer experience.

We plan to live within our means while we prioritize unit economics profitability and liquidity over growth.

As previously announced our roadmap relies on or focused strategic initiatives.

Build a well oiled transaction machine our transaction machine includes titling and registration selling e-commerce and marketing.

During Q3, we made improvement toward our goal of building, a well oiled titling and registration machine and we began building a well oiled sales machine.

Second build a well oiled metal machine, how we buy move recondition sell deliver and priced vehicles.

Our goal is to optimize the end to end supply chain by synchronizing, how we buy move recondition and deliver vehicles to reduce cycle times reduce supply chain costs improve inventory turns and improve customer delivery times during.

During Q3, we continue to make improvements in building, our well oiled machine and we began transitioning our Stafford Reconditioning center to the GTA Service Center locations.

Third build a regional operating model leveraging our national brands, we intend to sell nationally, but operate more regionally around our reconditioning centers and transportation hub.

We expect to build density in regions to drive marketing and supply chain economics, while improving customer delivery times, we have a significant opportunity to reduce the number of miles or vehicle travel and reduced inbound and outbound transportation costs from Q1 to Q3, we have reduced the average number of miles or vehicles travel by.

18%.

Fourth builder captive financing offering.

We intend to expand our captive finance offering for <unk> customers, which we believe will improve conversion rates and improved unit economics, while also improving the customer experience.

We also intend to continue to grow the UAC third party dealer business, which contributes to our consolidated EBITDA.

On slide four our third quarter highlights, we improved adjusted EBITDA, excluding nonrecurring expenses by $20 million or 26% sequentially.

Our e-commerce gross profit per unit or GPU was $4206, reflecting progress toward our long term goal.

We reduced adjusted SG&A by 21 million sequentially as we continue to reduce variable and fixed costs.

We realized a $16 million securitization gain at UAC, despite a challenging market.

We reduced our restricted cash by $59 million.

Primarily driven by the improvements entitling them registration.

We are making progress on our long term road map and our four strategic initiatives.

We continue to make improvements in transaction processing, including titling and registration as we've mentioned our goal is to become best in class entitling them registration.

98% of customers received their registrations before the expiration of their initial temporary tag in the month of October .

Im really proud of the improvements are roommates anymore ACC colleagues have made to registration.

We began the transition of our Stafford Reconditioning center to the TDA Service center location, which will lower our fixed costs.

Our long term roadmap plan to slowly in source the sales function over time.

In Q2, we started in sourcing with a small sales class to build our internal capabilities and that initial classes met our expectation.

In the back half of August we experienced a large unexpected staff reduction at one of our third party sales partners.

We reacted quickly to accelerate hiring additional classes of internal sales staff.

It takes time to hire and train new selling resources and additional time for them to reach peak effectiveness.

We have been successful in hiring additional classes and expect to be fully staffed in Q1 2023.

While we had planned a slower and smoother transition to in source. Our sales function. We believe this transition will reduce our selling cost per unit earlier than initially planned.

We have been focused on reducing variable and fixed costs and we will continue this focus.

We repurchased $56 million face value of our convertible notes for $18 million, reducing our leverage.

Given our focus on profitability and liquidity over growth.

Unexpected reduction in selling resources during the quarter and the macroeconomic environment. We currently expect to be below our forecasted ecommerce unit range for the year better than the midpoint of our forecasted adjusted EBITDA loss range and near the midpoint of our previously forecast.

The liquidity range.

On slide five.

During Investor Day, we outlined these key unit economic drivers behind our four strategic initiatives that we believe will build a profitable business model.

This slide is an update to our Q3 operational progress on our four strategic initiatives by financial lever.

For the product and vehicle GPU, we achieved $4206 ecommerce GPU driven by our pricing initiatives and captive financing operations.

UAC completed its second securitization since our acquisition and new Acc's, 14th securitization overall, demonstrating <unk> ability to leverage its substantial capital market experienced.

To opportunistically deploy securitization transactions and maintain capital flexibility even in a challenging market.

Logistics, we reduce our all in logistics costs by $5 million sequentially.

Inventory as we continue to improve the titling process. We expect this to increase the number of vehicles, we listed for sale and reduce the number of vehicles listed as coming soon we expect this will improve our inventory turns.

Sales, we've reduced our sales costs by $1 $3 million sequentially, we began our sales pilot and launched new E Commerce initiatives.

Titling and registration we've seen significant improvement in our title and registration process with 98% of customers receiving their registration before the expiration of their initial temporary tag in the month of October .

As we continue to improve our titling process, we're receiving titles of aged vehicles that had not been listed for sale due to the delay in obtaining the title as we received these titles of aged vehicles and lithium for sale, we expect pressure on Q4 GPU.

We reduced our Thailand registration and support costs by $5 $9 million sequentially.

Marketing, we reduced our marketing costs $4 million sequentially and continue to focus on improving marketing return on investment and conversion.

Fixed costs, we reduced our fixed costs $4 million sequentially and we continue to focus on additional fixed cost reduction.

These variable and fixed costs sequential changes represent the $21 million sequential reduction in adjusted SG&A mentioned earlier.

Lastly, our advanced analytics team functional business teams and tech teams continued to build data assets analytical assets in tech assets.

That we believe in the long term will provide a competitive advantage across titling and registration pricing conversion vehicle in product margin and supply chain costs.

Slide six unit trends.

While we don't plan to share monthly unit numbers going forward, we felt it was important to share how the events.

Impacted our monthly unit volume in.

In July as registrations and our customer experience continue to improve we took steps to normalized unit sales, which increased unit sales from July to August by 36%.

As mentioned earlier in the back half of August we experienced a large unexpected staff reduction at one of our third party sales partners customer contracts were down 32% during the four weeks after the sales force reduction compared to the prior four weeks.

We expect that transition of our sales function as well as challenging economic conditions to impact units in Q4, we expect our sales function to be fully staffed in Q1 2023.

I'll turn it over to Bob now to go through our financial performance in the third quarter and our forward outlook Bob.

Thanks, Tom.

I'll start with a summary of our financial performance on slide eight.

All comparisons are against the prior quarter unless otherwise noted.

Total revenues of $341 million decreased 28% as ecommerce units declined 30%.

Consistent with our strategy, we intentionally slow transactions to focus on operational execution and unit economics.

As Tom mentioned earlier unit volumes were also impacted by a reduction in third party sales resources beginning in the back half of August as well as overall macroeconomic conditions.

E Commerce, <unk> increased 16% to $4206.

During the third quarter, we realized further pricing optimization, which contributed to the increase in vehicle GPU.

As well as increased product GPU as we scale USCC originated loans.

Adjusted EBITDA loss, excluding nonrecurring costs improved $20 million to $57 $5 million.

The improvement was driven by higher gross profit dollars and reduced SG&A spending.

$16 million securitization gain was the primary driver of increased gross profit.

On the expense side, we further reduced our fixed and variable operating cost as we continue to pursue our three key objectives.

These costs exclude $16 million of nonrecurring costs to address operational and customer experience issues, consisting primarily of $12 million of rental car expense during the quarter.

We are expecting a significant reduction in nonrecurring rental car expense in the fourth quarter and going forward as a result of our improvements in the titling and registration process.

Our net loss for the quarter of $51 million improved $64 million.

The primary drivers of improvement were $38 million gain on debt extinguishment due to our repurchase of convertible debt.

$16 million securitization gain I referenced earlier and improved operational results.

Let's turn to our financial highlights on slide nine.

Starting with adjusted EBITDA performance.

Excluding nonrecurring costs, adjusted EBITDA improved $20 million quarter over quarter.

As discussed earlier improvements in adjusted EBITDA were driven by higher GPU reduced operating costs and the gain on our third quarter securitization at ACC.

E Commerce units decreased 30%.

One key driver of our lower unit sales volume continues to be a focus on operational improvement as we intentionally slow transactions to improve unit economics and the customer experience.

Third quarter unit volumes were also significantly impacted by reduced third party sales support staffing beginning in the back half of August .

While we don't expect the long term unit impact from this transition as we scale lower cost sales resources consistent with our long term roadmap.

We do expect an ongoing unit impact in the fourth quarter as our new team members ramp up to full productivity.

In addition to the factors previously mentioned third quarter units were also impacted by current macroeconomic conditions.

I would like to provide some additional detail on our E. Commerce gross profit per unit performance, starting with vehicle gross profit.

Vehicle gross profit per unit increased 5% to $2267.

This increase was driven primarily by higher sales margin as we further optimize pricing.

As Tom mentioned earlier, we have seen significant improvement in our titling and registration process with 98% of customers receiving the registration before the expiration of their temporary tag in October .

This process improvement is increasing inventory available for sale on our website from purchases earlier in the year.

As a result of this process, we expect a higher portion of our unit sales over the balance of the year to be from aged inventory as we obtain titles for cars previously not listed for sale.

Coupled with declining used vehicle prices across the market. We expect this to negatively impact our sales margin in the fourth quarter.

Moving on to product GPU.

Product GPU increased 33% to $1939 as you ACC source financing continues to perform in line with our expectations are higher vehicle and product GPP you ultimately delivered total ecommerce GPU of $4206 a 16%.

Sequential increase.

Let's move to slide 10 for a second to third quarter comparison of our adjusted EBITDA performance, excluding nonrecurring costs.

Sequential declines in ecommerce unit volumes impacted e-commerce gross profit by approximately $10 million.

This was partially offset by a $4 million benefit from higher ecommerce GPU.

Next the new ACC securitization contributed $16 million of gross profit to the retail finance segment.

This was partially offset by a $9 million decrease in non E. Commerce gross profit primarily driven by lower interest income from third party dealership finance receivables.

As a reminder, since we are not yet performing securitizations every quarter, we expect quarter to quarter volatility in these amounts with a buildup in this interest income and non securitization orders and a decrease in quarters, we entered into a securitization transaction.

Total expenses, excluding nonrecurring costs decreased approximately $19 million a.

Approximately half of this decline was driven by lower compensation and benefit expenses as we continue to focus on cost reductions.

We delivered an additional $9 million in cost reductions, primarily in marketing and logistics and also decreased variable costs due to lower unit volume.

Overall, we improved adjusted EBITDA, excluding nonrecurring cost by approximately $20 million or 26% improvement.

Moving to liquidity on slide 11.

We took a number of actions during the third quarter as we continue to maximize liquidity.

First we reduced restricted cash on the balance sheet by $59 million sequentially.

This cash became available primarily as a result of lower inventory levels and improved transaction processing and title and registration.

Our process improvements also reduced cash and inventory by $21 million during the quarter.

Next we repurchased 56 million face value of our convertible notes for $18 million, reducing our leverage we may continue to opportunistically repurchase notes from time to time to reduce our outstanding indebtedness at a discount subject to market conditions and availability.

In addition, we recently amended our vehicle floor plan facility, which now extends through the end of March 2024.

Finally at ACC, we completed our third quarter securitization, despite more challenging subprime market conditions, our transition to full the captive lending remains on track.

Let's turn to our liquidity guidance update on slide 12.

We ended the third quarter with $510 million in liquidity as a reminder, we define liquidity as cash and cash equivalents.

The purpose of this chart is to simply show the components of our change in liquidity based on the guidance that we previously provided last quarter.

We continue to anticipate our year end liquidity to be near the midpoint of our $450 million to $565 million range.

With that I'll turn it back to Tom for a few closing remarks Tom.

Thanks, Bob turning to slide 13 to summarize the quarter.

98% of customers received their registrations before the expiration of their initial temporary tag in October as we continue to focus on becoming best in class entitling in registration.

We improved adjusted EBITDA, excluding nonrecurring costs by $20 million or 26% sequentially.

Our e-commerce GPU of $4206 reflects progress towards our long term goal.

Reduced adjusted SG&A by $21 million sequentially.

We reduced restricted cash by $59 million sequentially, driven primarily by titling and registration improvements.

We repurchased $56 million face value of our convertible notes for $18 million. We are forecasting year end liquidity near the midpoint of our guidance I look forward to updating you on our progress on our four strategic initiatives each quarter as we pursue our long term roadmap.

Thanks for your time today, and operator, we are ready for questions.

Yes.

Yes.

As a reminder to ask a question you will need to press star one one on your telephone.

Thats Star one one on your telephone to ask a question.

Please standby, while we compile the Q&A roster.

Okay.

Our first question comes from the line of Rajat Gupta of Jpmorgan. Please go ahead.

Hey, good morning, Thanks for taking the question.

Maybe first one just one Mako GPU.

<unk> already strong number better than most of your peers.

Obviously, youre being selective so a couple of questions.

How much of the GPU.

Just from shipping fee.

If you can help clarify that and then.

As volumes start to ramp back up you know.

We are better staffed.

What is a good normalized levels or think about that you would want to manage that may continue to be around.

I'll follow up thanks.

Hey, Good morning, John I think we're in the target range of where we want to be long term I would tell you quarter over quarter.

Our delivery fees were actually down a little bit as we continue to experiment with what the.

The right balances to optimize the overall GPU and volume. So I think we're where we want to be in the long run I think as we mentioned in the short term as we get all of these titles for cars that we have not listed for sale that caused some pressure in this quarter, but I think once we get through.

Being current on titles maintaining.

Staying current on titles I think around 4200 range is kind of what we put in our long term plan and we would moderate volume we're going to continue to be focused on unit economics over growth.

That's why we pointed out in the deck during this quarter, even at 4200 GPU. When we made the decision to grow from July to August and what I would really call normalized demand, we're doing that in the context of still optimizing GPU. So it's certainly hard to predict what's going to happen in 2023, especially with.

Macroeconomic backdrop.

But we think long term this is directionally around the rage and I would say, we still have several initiatives that we outlined on Investor day that we're just scratching the surface on so of all the numbers like we feel pretty good about where we're at in GPU for the long run.

Got it and then.

If you're managing GPP, you with being careful around volumes and proactive on that front.

I mean, how are you.

How should we think about SG&A leverage.

Thank you.

If you can give us a sense of you know.

How much of the fixed horses variable component.

And then today.

Given that focus on <unk> expense of Walden.

When should we start to see SG&A come down to a level.

Here, you can get your business or profitability at that lower volume.

Yeah. Thanks, Chris So we're really taking a long term view transforming the business and so in the long run we definitely need to continue to drive SG&A down variable and fixed cost. So I'll just break it down the way, we think about variable costs, our marketing cost per unit is clearly way too high.

And we're making adjustments to that but we've also initiated new projects around how do we drive conversion you may recall from Investor day, we have a significant amount of subprime traffic.

Historically, we've not been successful in converting into sales. So one of the key levers that we look at in terms of driving marketing cost per unit down is really focused on our conversion and we have projects that we're working on that will be happening in Q4 and throughout next year, but we're really taking a long term view on how do we drive conversion to get.

Our marketing cost per unit in line Directionally around what we outlined on Investor day.

Our next biggest bucket is title and registration while we've made huge improvements our cost entirely registration are still too high and we're going to keep putting the customer first we're going to continue to focus on building. This best in class titling registration process, that's our goal.

At the same time, we've got tech initiatives that are rolling out in Q4, and then the first half of next year that we expect to bring titling and registration costs down and right now when we look at what the assumptions we made in our roadmap that we outlined in May.

We believe at this point that we can continue to focus on driving those costs down the next bucket is logistics.

I would tell you that our logistics cost cost per unit on the volume that we have today is too high but we have consciously for for the shorter term. We've decided we've got a lot of what I'll call semi fixed costs in our variable costs, where we're keeping hubs open because when we do get things right.

The titles in place and begin to grow.

In the future we think we've got the right network and so for the short term, we're willing to have a little higher.

Logistics are I would say I feel real confident that the team has really made huge improvements in the way our line haul operate than our last mile hub operates and we're being very strategic around how to optimize costs between our internal trucking resources and third party and so I'm really focused.

How do we build that into a well oiled machine and I believe that those cost per unit will get in line as we as we do grow again, and then lastly fixed costs, we break those down into two components. One clearly we have had.

In fixed Scott and I'd say that our tech resources are becoming more and more efficient and we're focusing them on the highest value added projects and in the short term, we really need our tech assets to drive this transformation. So in the shorter term youre going to see our tech cost per unit higher than we'd like in the long run and we will.

Expect to normalize that with volume and then we've got other costs like finance HR and Eagle legal and I would tell you across all of those our teams are working to find efficiencies and then the last big bucket I'd Callout resort is we have a lot of contracts that we entered into when we are in a very growth mindset oriented company where.

Frankly, our contracts our size larger than we need them at the size of the company. We are now and we're going back to all of our partners and we're working through trying to right size. Some of those contracts and I would tell you. We have some really wonderful partners and we're trying to work with them in the long run how do we adjust contracts.

And we're going to remember those that work with us to be favorable and we're going to have an even longer memory for those that don't work with us, but kind of holistically. That's how we look at our entire variable and fixed cost structure and we're working on it on a daily basis.

Got it got it.

Bold color I'll jump back in queue. Thanks.

Thanks for that.

Yes.

Thank you. Our next question comes from the line of Sam Reid of Wells Fargo. Please go ahead.

Thanks, So much guys for taking my question here.

Quarterly unit commentary was very helpful, especially the monthly breakout.

That's what I was wondering if you guys could unpack the quarter to date trends in a bit more detail and maybe give us a sense.

Kind of as to how much of the sequential unit decline that you've called out for October reflected some of the third party issues you mentioned on the call versus your ongoing efforts to focus on profitability versus the macro I guess, what I'm trying to say is bucket in those three drivers there. Thanks.

Good morning, Sam Yes, it's a fantastic question and it's something we actually work on on a daily basis.

It's clear if we look at just the competitive environment and what others in the industry have reported there is definitely a macroeconomic environment component that's happening to demand.

Very hard for us to tease that out in our numbers because we have so many moving parts in our business that we're trying to move as we try to transform this business what I can tell you is.

And I mentioned it earlier in my opening comments that.

We had this large sales force reduction and it was very large and that happened in a single week and if you look at the four weeks before and four weeks after that we had a 32% reduction in contracts I'll give you a couple of other metrics around that or contracts per sales rep. So that's.

Kind of a productivity metric for us the week before versus the week. After they were basically flat down 1%. So it was really a matter of having resources to help customers get through the sales transaction process. We have been ramping our sales force one of the unknowns for US we had a very.

<unk> third party partner, that's been with us for a long time that was.

That had this reduction in sales force and we are realistic and that is going to take us time to rebuild it as I mentioned in our <unk>.

And our long term roadmap, we expected to transition. This this selling costs internally over the long term like it was not in our radar for this year.

Because it just wasn't one of our priorities. So we had to quickly move on that does that definitely had a material impact and then of course, we continue to test different levers around what the right one.

The right mix of volume versus GPU. So, it's very hard to tease out, but we wanted to acknowledge it certainly some element of it is the macro economic environment, but when we initially looked at like the drastic reduction in our Salesforce definitely had a significant impact so I think for us.

It's such a fragmented market and we have such a small share in the market.

Our question as we go into next year is how much market share can we gain when we have a selling staff that can actually manage manage the inbound traffic thats coming through and we're going to learn that as we go through 2023.

No. That's helpful color and you basically basically answered my follow up question. So maybe if I could just slip another one in here on a slightly different topic kennan, what's a healthy run rate per vehicle GPT E&P GPU at some of the older vehicles that might not have been live on your site due to tightening emissions through flow through.

It sounds like Theres going to be a sequential step down in <unk>, but any sense of the magnitude there in Q4 versus Q3.

Yes, So let me give you some color on that Sam So we've been selling that's actually a metric we track.

We started tracking in Q2, and Q3 AIDS vehicle sales and as we really drastically changed the way, we think about pricing vehicles I've been quite surprised by we have cars that frankly, we've had greater than 180 days, even greater than a year that we are producing very strong gpus answer.

We're being very Vin level focused on optimizing profitability on every vehicle regardless of its age. It is clearly our long term goal to drastically reduce our inventory and get the inventory down to something more reasonable and whether that 60 days 90 days 120 days I can tell you that yet.

But we're going to see when we get there. So during Q2 in Q3, we have been selling a mix of vehicles that are aged.

As we've worked throughout the year really got to where we want to get too on registration we've been working on titles all along but now that we're getting registrations, where we think we want them.

We're doubling down on titles, so what we're expecting to see is a.

Influx of these titles coming in on vehicles that have been sitting for quite some time, we expect that those will still be profitable sales just lower lower profits so to get to your answer if we were to end the quarter right now I would expect GPU for Q4 to be somewhere in the low threes. It early.

In the quarter.

I would be I wouldn't be surprised if that number could go as low as 2500 or as high as 3500.

Depending on how things go the rest of the quarter, we do see this as a short term issue solely related to.

The delay in the titling process, especially has the depreciation right of used cars have increased a bit lately.

So we see this as a transitory issue that once we get this behind US we will not recur.

No that's super helpful color really appreciate it and I'll pass it on.

Thank you Sam.

Again to ask a question. Please press star one one on your telephone again Thats Star one one on your telephone to ask a question.

Our next question comes from the line of Colin Sebastian Baird. Please go ahead.

Hello, This is calling on for Colin Sebastian Unlike ste.

Question could you. Please talk about the impact on the model from the transition of the Strafford Stafford IRC to TBA.

Yeah. Thanks for the question.

Don't see that as a significant impact it's going to reduce our fixed costs by <unk> <unk>.

Several million dollars once we exit the current facility, it's going to provide a much better environment for roommates that working that reconditioning center. So it's really about creating a better environment, we're going to remove the fixed cost of the current staff or location.

But we don't see it as something significantly material.

Okay. Thanks.

Thank you.

Thank you. Our next question comes from Vincent Carlos.

Jefferies. Please go ahead.

Hey, guys. This is Vincent Cardoso on for John .

Curious to know why.

Have you guys seen thus far in Q4 in terms of retail demand for used cars and the trends seem to be kind of the same across the consumer credit spectrum and for higher and lower end cars.

Or more like what we've seen earlier in the year and then as a follow up if you could talk about your outlook for used car demand in 2023.

That'd be great as well anything to sort of help us get some insight into end to pricing expectations on that.

And expectations for demand going forward would be helpful. Thanks, guys.

Yes.

Yes, thank Vincent.

Given the transformation we've been doing this year, it's really hard for us to tell what's happening in used car demand given all the various levers we're pulling.

Improve the business clearly we note.

We actually think our other competitors are probably a better proxy for what's going on in the industry and clearly there is some softness.

I think I think that's a $64000 question what how is the how are things going to play out next year as the fed continues to raise rates.

It depends on what happens with inflation. So unfortunately, we don't have a lot of great color to share on on next year's demand. We do think at this point. The majority of the things that are happening internally are related to us just not having sales resources were also very curious to see how Q1 plays.

When we are fully staffed on sales resources and I'd say, we probably have a better view at the end of Q1 in terms of what we're seeing and just used car demand.

Okay. Thanks that makes sense. Thank you.

Thanks Vincent.

Thank you at this time I'd like to turn the call back over to CEO , Tom Sharp for closing remarks, Sir.

Great. Thank you everyone for your time today and have a fantastic day.

This concludes today's conference call. Thank you for participating you may now disconnect.

The conference will begin shortly to raise your hand during Q&A you can dial one one.

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Okay.

Okay.

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Yeah.