Q1 2023 Lantronix Inc Earnings Call
Good afternoon, everyone and welcome to the Landstar on its first quarter 'twenty 'twenty three earnings conference call. All participants will be in a listen only mode should you need assistance. Please signal conference specialist by pressing the star key followed by zero.
After todays presentation, there will be an opportunity to ask questions to ask a question you May press Star and then one to withdraw your question you May Press Star two.
Please also note today's event is being recorded and at this time I would like to turn the floor over to Rob Adams. Sir. Please go ahead.
Thank you and good afternoon, and thanks for joining us for our first quarter of fiscal 2023 conference call.
Joining us on the call today are Paul Pickle, our President and Chief Executive Officer, and Jeremy Whitaker, Our Chief Financial Officer, a live and archived webcast of today's call will be available on the company's website. In addition, you can find the call and detailed for the phone replay in todays earnings release.
During this call management may make forward looking statements, which involve risks and uncertainties that could cause our results to differ materially from management's current expectations.
Courage you to review the cautionary statements and risk factors contained in the earnings release, which was furnished to the SEC today and is available on our website as well as the company's SEC filings, such as 10, Ks and 10, Qs Medtronic undertakes no obligation to revise or update publicly any forward looking statements to reflect future events or.
Circumstances, please refer to the news release and the financial information in the Investor Relations section of our website for additional details that will supplement management's commentary. Furthermore, during the call. The company will discuss some non-GAAP financial measures today's earnings release, which is posted in the Investor Relations section of our website.
Describes the differences between our non-GAAP and GAAP reporting and presents reconciliations for the non-GAAP financial measures that we use with that I will now turn the call over to Jeremy Whitaker Chief Financial Officer.
Thank you, Rob and welcome to everyone joining us for this afternoon's call.
I'm going to provide the financial results as well as some of the business highlights for our fiscal for our first quarter of fiscal 2023 before I hand, it over to Paul for his commentary.
In September of 2022, we closed the acquisition of up logics for $8 million in cash consideration and an additional cash earn out of up to 4 million as certain revenue targets are met we funded the acquisition with an increase of 5 million to our existing term loan and available cash.
As a result, our first quarter of fiscal 2023 includes approximately two weeks of operating activity related to the <unk> acquisition.
Although not significant to our first quarter results. The acquisition was accretive to non-GAAP earnings and is expected to be accretive on a go forward basis.
For the first quarter of fiscal 2023, we reported revenue of $31 8 million, an increase of 15% when compared to $27 7 million for the first quarter of fiscal 2022.
As expected revenue was down sequentially as compared to $35 9 million reported in the fourth quarter of fiscal 2022.
Our most recent acquisition contributed approximately 400000 of revenue in the current quarter.
Yeah.
GAAP gross margin was 44, 1% for the first quarter of fiscal 2023, as compared with 41, 9% in the prior quarter.
The sequential improvement was related to lower supply chain costs. In addition to improved product mix.
Selling general and administrative expenses for the first quarter of fiscal 2023 were $9 2 million compared with $7 9 million for the first quarter of fiscal 2022, and $9 4 million for the fourth quarter of fiscal 2022.
Research and development expenses for the first quarter of fiscal 2023 were $4 5 million compared with $4 million for the first quarter of fiscal 2022, and $4 9 million for the fourth quarter of fiscal 2022.
The year on year increases in SG&A, and R&D were largely driven by the acquisition of the 10 companies at the beginning of fiscal 2022. However.
However, as a percentage of revenue expenses were down from the year ago period.
Okay.
GAAP net loss was $1 7 million or <unk> <unk> per share during the first quarter of fiscal 2023 compared to a GAAP net loss of $2 3 million or eight cents per share during the first quarter of fiscal 2022.
non-GAAP net income was $2 7 million or <unk> <unk> per share during the first quarter of fiscal 2023 compared to non-GAAP net income of $2 5 million or eight cents per share during the first quarter of fiscal 2022.
Now turning to the balance sheet.
We ended the September 2022 quarter with cash and cash equivalents of $13 1 million as compared to $17 2 million in the prior quarter.
Working capital was $50 3 million as of September 32022, as compared with $54 5 million as of June 32022.
Net inventories were $45 3 million as of September 32022, compared with $37 7 million as of June 32022.
The sequential increase was primarily due to the assumption of inventories and the <unk> acquisition.
And the purchase of components to support the Enel project, which is expected to ramp during the second half of the fiscal year.
Now turning to our revised annual outlook.
After adjusting for our recent acquisition of <unk>.
For fiscal 2023, we are increasing our target as follows.
Revenue.
$155 million to $165 million.
And non-GAAP at and non-GAAP EPS in a range of 41 to 46 cents per share.
We expect the revenue and earnings growth to be more heavily weighted in the second half of the fiscal year as our two largest design wins are expected to ramp into full production during the second half.
I'll now turn the call over to Paul Thank.
Thank you Jeremy while we expected a slower start to our fiscal 2023 I'm pleased to report we've made good progress on a number of fronts in the quarter.
Revenues grew 15% year over year, we saw some margin improvement thanks to lower logistics and supply chain costs, and we acquired a high value added systems business. We also laid the groundwork for the remainder of the fiscal year, we have a watchful eye on the economy and while we do note some caution in bookings patterns as some customers have begun to book orders in.
Later quarters, we entered the December quarter was starting backlog up versus September and our total backlog is up as compared to last quarter.
All in we see a return to sequential growth in December followed by accelerating growth in the second half as we ramp to volume production with two of our larger compute customers.
Turning to our product discussion embedded Iot solutions totaled $15 1 million down 18% sequentially, but up an impressive 22% year over year and representing 47% of total revenues, we saw strength in our niche and SMP products, which benefited from seasonal strength of key federal customers, but.
This was offset by a falloff in compute due to process or component supply constraints. After a strong performance in our fiscal Q4 June quarter. We currently see embedded systems strengthening throughout the year driven by our compute products in Q3 and Q4, we plan to benefit for.
Shipments to electric vehicle customer Tog, which just had the grand opening of its production facility in Turkey, Todd will begin taking shipments this quarter and we expect to be in full swing by the March quarter.
Turning to system solutions revenues here totaled $14 6 million or 46% of revenues flat sequentially and up 11% year over year within system solutions switching products saw the strongest growth benefiting from significant interest.
From our growing smart city customer base. In addition, our drilling fed business resulted in and is benefiting from a stronger fed buying cycle for network interface products did this strength was offset by lower media converter solution sales, which slowed after a strong fiscal year and quarter.
For the remainder of fiscal 2023, we expect to see a rapid acceleration of our systems business led by the ramp to volume production of the smart grid quantum edge device or QED for our customer grids for Ts.
We received our first purchase order for the pilot run in the September quarter and will begin recognizing revenue in the current quarter, we expect to complete a purchase contract for ensuing production this quarter and we currently expect to ramp to volume against our previously announced production awards in our fiscal Q3 and Q4.
Within the systems business, we reported approximately $400000 of revenue from our recent acquisition of out of band networking supplier up logics, which closed in the middle of September .
<unk> is a key acquisition for us on a number of fronts.
Number one the <unk> product offering augments, our existing out of band solutions with high end higher port count devices that offer a high degree of automation and control functionality and security, which makes them, especially valuable to federal and financial customers.
These systems complement our existing portfolio, giving us a broader product offering to address data center applications with increased scale and synergies.
Yeah.
Number two this is a margin accretive transaction the up logics product margins are in line with our own out of band solutions and our new portfolio brings with it a strong base of recurring software and support revenues on the whole. This acquisition is expected to be nicely accretive to land <unk> corporate margins.
And lastly, this acquisition delivers energy sent in engineering synergies.
And solidifies our product roadmap.
Today's data center architectures are changing and our product roadmap was due for a refresh acquiring up logics is expected to save US an estimated $3 million and next generation product development.
And as we have just demonstrated previously the fragmented Iot market continues to offer value we were able to acquire this high margin systems supplier at a discount to its last 12 months revenue of $9 million paying $8 million in consideration for the remainder of the fiscal year, we are expecting revenues to be over 5 million.
From this acquisition.
Looking at software and services revenues in Q1 accounted for 7% of total revenues or approximately $2 1 million software and services revenue was down 28% sequentially. Following a record quarter in Q4, which was driven primarily by preproduction activity for compute customers grids for Ts and talk.
We do expect some volatility in this line.
In addition, after accounting for the acquisition of up logics, we exited Q1 with a high margin subscription a R R of greater than $5 million.
In summary, while Q1 results showed a pause to our growth trend. We are confident in our prospects for the remainder of fiscal 2023, we expect to resume our growth trend in December led by the resumption of compute revenues and we expect that trend to accelerate in the second half of our fiscal year as we recognize volume shipments to enel and <unk>.
Talk.
Our backlog remains healthy the supply chain is seeing improvement with more easing expected in the new year and our acquisition of up logics will drive implement incremental revenues much of which will come from customers new to <unk> and to whom we can offer a more comprehensive Iot solutions product offering.
That completes our prepared remarks for today, so I'll now turn it over to the operator to conduct our Q&A session.
Ladies and gentlemen at this time, if you would like to ask a question. Please press star and then one to withdraw your question you May press Star and two.
If you are using a speaker phone. Please do ask you. Please pick up the handset prior to pressing the numbers to ensure the best sound quality.
Once again that is star and then one to ask a question.
Our first question today comes from Mike.
Walkley from Canaccord Genuity. Please go ahead with your question.
Great Thanks, and congrats on the.
Solid start to the year I guess, Paul in previous quarters, you've talked about the supply chain and you know our metric of customer requested product that you couldn't ship during the quarter.
Can you elaborate maybe on how supply might be improving in and where that metric might might be now.
Yeah. So the the latest CRD shipment came down slightly in the quarter to two 8.3 million I believe this was additional shipments requested in the quarter that we were not able to meet.
Overall, the backlog is as higher total backlog.
At the end of the quarter was higher than the previous quarter. So we're seeing some bookings taking place in the out quarters.
And so I think that explains a little bit of you know.
Some of the economics that are going there, but in terms of supply chain.
We've had some disappointment on the mixed signal side I'd say largely you know some of the digital semiconductor components are more readily available today.
Memory certainly has normalized.
We're seeing some of those ppvs come down they take a while to work through the P&L.
But some mixed signal components in particular are still difficult to get analog is still difficult to get so T. I.
Adi NXP Cypress also we've been having.
Having some issues with some Cyprus.
Supply as well of late.
But overall I'd say that it continues to improve we've.
We've gotten some easing out of.
Out of the new blocks for instance, and some other suppliers so.
I'd say the picture is still looking better and as we enter this new year I expect it to continue to improve.
Great. Thanks.
As a follow up question you know gross margins were stronger than expected this quarter and it sounds like.
Up logic seems like a good fit and that's margin accretive also any update on how we should think about gross margins I know theres a lot of moving parts with different projects ramping in the year also.
Yeah, we we still like the mid Forty's model for gross margins I think as we kind of take on more and more software revenue, we're going to see that rise certainly and when we talk about in a R. R. A number once again, we're talking about 90 plus margin business.
Essentially so.
You know that that $5 million or so they are our as it works through into the P&L certainly going to help bring things up I'll also note that in terms of supply chain easing we saw roughly just over $800000 of savings on the component.
Sourcing side this quarter. It takes once again takes a while to work through the P&L because those ppvs kind of rack up and then you have to choose through the inventory.
But it does bode well for an improving picture on a go forward basis, we're not changing our model per se at this moment, but I think in terms of thinking about a longer term model, where gross margins begin with a five handle I think that's a certainly on the horizon.
Great and last question for me and I'll pass it on as far as grid, sorry, great parties and.
Todd how are you.
Gonna have revenues for those in the December quarter or is it really the second half of the year, where you start to see the uplift from those two big projects. Thank you.
It's not significant revenue and I'd, so grids for Ts as a subsidiary just as a reminder of enel. They form that our subsidiary last September September of last year, I should say and so.
So it is expected grits pretty says the customer although a lot of the supply chain agreement is with Enel.
The parent we expect continued separation between those two over time and that will be an extended opportunity as there will be both consumption internally at it now and in the general marketplace for grids for Ts products. So if we are.
In terms of the timing of that revenue, we will definitely recognize revenue this quarter. The beginning of revenue this quarter from Togo.
With the initial.
Shipments of those Sip modules.
And we've been recognizing a services agreement revenue with talk over the last year or so, but the ramp really doesn't start to take place until till the March quarter and the same thing holds true for grid pretty as we would expect to see some.
Minor revenue this quarter beginning in this December quarter, as we guided before but really the lion's share of that revenue starts to take place in March.
With a stiff ramp through next calendar year.
Okay. Thank you I'll jump back in the queue.
And our next question comes from Christian Schwab from Craig Hallum Capital Group. Please go ahead with your question.
Hey, guys congrats on another solid quarter.
Paul can you tell us what you know of your of your $1 55 to 165 guidance.
Either by customer or together you know when we take a look at Tau again.
Neil for lack of.
But the real name, but and then because it sounds like it's just going to be about it you know start to ramp in and those things can always happen.
Now that the initial pace than expected. So I'm just wondering how much revenue you guys are assuming from those two applications.
And then.
In contrast of that you might have a lot better visibility I would assume.
About what you would expect to ship in calendar 'twenty three versus exactly what might be shipped at the end of March and into the June quarter. So any clarity or color you could help us with would be really helpful.
Okay. So I think in terms of as we look beyond this fiscal year. You know, we don't guide the fiscal year, but I would expect us to continue to grow.
As these programs really just start to touch fiscal year 'twenty three.
So you think in terms of full year full fiscal year impact in FY 'twenty four I would expect that growth trend to continue I want to be cautious not to guide individual pieces of business and.
You know at some point.
At least with some of these programs are going to be.
I need to be careful about putting out too much information just to be able to stay competitive but I.
I think we will see we talked about tog as being really a kind of $50 million opportunity over four years.
It doesn't mean that it has to be that I am mindful of what my customers are asking for.
Versus what I think can actually happen and what we have done previously what we've said previously is that you know now would begin to affect US ended the December quarter in fact that is happening.
And.
With a $10 million to $20 million impact in this fiscal year fiscal year 'twenty, three and I think that still holds true.
I will say that the customers internal schedules are a bit more aggressive they have not hit them for <unk>.
Various reasons, mostly they've been to due to other suppliers not delivering on time.
But you know with.
With the visibility we have it's still it's starting to happen.
This quarter and it's playing out exactly as we have been guided before in previous conference calls I think where it goes is.
Is kind of a guess at this point because we're talking about next generation design.
We're negotiating and engagement on what that next generation design looks like ultimately how much volume.
Do we get and what exactly does it look like still remains to be seen which I think is a positive for us now that.
<unk> is still in engineering mode. So.
To recap that talk what we've said is $50 million over four years, it's going to be a ramp into.
Into really kind of post second years, where we get some meaningful volume initially this year their production schedules around 30000 units to start but as stated previously that factory can support up to 167 or 165000 cars a year I don't know how many they are ultimately going.
To be able to run through that factory. So it's a it's a little bit of a guess and then now we'd like to get to a 100000 units a year, but when that happens I would expect production to be to split be split between multiple suppliers.
Great great. Thank you for that and if we kind of look at the you know the core business you know ex acquisitions and.
You know large new customer products, you know what what are you thinking about that remaining core business. What do you think that steady growth rate is you know on a go forward basis.
Yes, that's a great question I think this past year, we talked about that that base business, having really outperforming better than it really should.
And at some point in the June quarter.
Mid year, I kind of expected it to pull back to mid to high single digits. So that.
That is kind of built into the guidance for this next fiscal year. We are thinking in terms of that base business pulling back to mid to high single digits growth, it's still clipping along nicely.
We continue to introduce new products in that space and they continue to get picked up so that industrial like business it doesn't move.
Fast up or down.
That's.
In line.
Mid to high single digits really is what it should do.
Great and then one last question if I may you.
You talked about you know the nice Oh software driven you know margins in and the growth expectations for that to continue it and an opportunity.
Just to have 45% gross margins Ido as a target, but eventually in the not too distant future I think were your words.
You know it should be 50%. So you know with these large program wins.
That we just walked through earlier can we ship a significant amount of revenue to those and still operate the company near 50%.
Gross margin is that is that what you were trying to say.
So I'm not saying that what I'm, saying is a mid forties are definitely I think the answer to the question is mid Forty's and then as software becomes a larger component I think we can start to creep that gross margin.
It does take a couple of things one software traction we still have our sights on getting to that hurdle of 10% of company revenues coming from software sales when I say software sales I'm talking about 90 plus.
Per cent margin again, and so as we kind of enter that stage, obviously, we will refine the hardware portfolio to start extracting higher value dollars as well and then I expect to benefit from supply chain easing cost we got some benefit this quarter from freight as well coming back down so.
A number of things kind of driving the company towards at five handle but I think that you will see some bottom line profitability changes as well and so I believe I said future I didn't say not so distant future, but I'm thinking in terms of this.
This fiscal year getting past it operating at mid Forties, and then looking to see some margin expansion beyond that.
Fantastic no other questions. Thank you.
And our next question comes from Scott Sarli from Roth Capital. Please go ahead with your question.
Hey, good afternoon, Thanks for taking my questions and nice job on the quarter.
Paul I apologize I got on the call little bit late but I was hoping to dive in on up logics I heard you say 5 million contribution for the year I'm not sure. If there was any contribution in the September quarter was wondering if you could provide a little color. There also the number of employees that came on board as part of it.
And as we kind of think about this saw the gross margin mix going forward I would think that that has an upward bias.
But I'm kind of wondering now as we start to have and now coming into the mix with Todd coming into the mix.
Should we be expecting a little bit of a step backwards before we start marching up into the mid Forty's and higher.
Okay. So 400 K contribution from up logics in the quarter kind of negligent. We did say it was immediately accretive or accretive in the quarter, but it's not significant.
And then in terms of a $5 million it was over $5 million of revenue in this fiscal year.
This is a business that did 9 million trailing 12.
So we're picking it up partway through the fiscal year.
And then there is some seasonality to that business 25 employees was was what was at the business when we acquired <unk>.
You can expect as we integrate that number goes down a bit but it's a very good talented team we're happy to see that.
To integrate that team into land tronox proper and to leverage that group I will say, mostly an outsourced.
The company in terms of hardware engineering, So we'll get the benefit of some of the resources, we have here as well as our contract manufacturing.
Just looking at the bill of materials.
We know immediately we can take 30% of cost out of the Cogs line. So we're going to get a nice little pick up.
As we continue to take over that business, but there was.
A decent chunk of inventory.
That was attached to the assets, we have to get through that first in terms of overall margin profile.
One of the reasons why I'm, saying mid mid Forty's as we'll have pieces of business in software.
Against the takeover or we get better traction in software that's going to counter some of the.
Lower margin more aggressive opportunities that we have to.
Have to chase and I want to be cautious about guiding a particular piece of business and talking about that effect because of Ah I would in net effect start to negotiate with myself with public remarks, and I'm sure. You can appreciate that probably shouldn't do that so just think in terms of the totality, if we get aggressive.
On our hardware program that provides a nice lift to the top line.
We are at the same time getting good traction in the high margin portion of the business I think this fiscal year that gives us a blend of mid forty's, unless we get some supply chain aegis easing that happens a little bit faster.
But beyond that I think we can start to inch upward with better traction on the software and high margin.
<unk> business as well.
Got it very helpful and Paul if I could just to dive in and I think on the guidance for this year of $1 55 to 165.
Quick back of the napkin kind of math implies that those gross margins are kind of in the mid to maybe.
Like solve even 45%.
Is that the right ballpark or you're expecting to ramp up some sales and marketing and other.
R&D efforts, a little bit more aggressively as we go into fiscal 'twenty three.
I will probably have some things to to fund in the second half of the year, but.
Given the revenue profile as they could have a hard time.
Bringing all of that investment to bear.
But fundamentally speaking we are still thinking in terms of a 10% EBITDA margin.
As we do have a number of good programs if I look at the pipeline of opportunities that we have.
We're chasing well over $200 million of new revenue growth and some of that is going to require investments. Some of it is going to require partial customer buy in.
But things just look pretty good right now and correct me if I misinterpreted your question on that one did I get it right.
Yeah that was perfect, but I guess to just kind of drive on the gross margin, but it just sounds like you've been fairly conservative right well, while 50% is a target.
That is certainly not built into the guidance that you are talking about today.
And that is that is correct. So mid forties this fiscal year and we're starting to see some traction on the high margin side of the business. So.
I think we can I think we can start to think in terms of long term chasing that that five handle on the gross margin and some increased profitability. We're not there yet, but we can see a pathway to get there.
Perfect and lastly, you kind of you kind of hit on insurance in terms of some of the pipeline.
I'm wondering if you could provide a little bit more color on that front I think the street, we've gotten myopically focused on now when tog.
But there's a big pipeline out there I suppose I was wonder if you could provide a little bit more color on that front and I guess as part of it.
Edge compute I think he is one of the areas, where you had some severe supply constraints recently.
Is that doing and kind of how should we be thinking about that pipeline of business timelines. That's deliverable, how you're seeing your win rates until we can kind of synthesize what that $200 million type of number looks like over the next couple of years. Thanks.
Okay. So yes in Q1, we definitely had a so Q4, we got some additional processors that came in there was the Samsung fab issue that presented has prevented us from back filling that in the Q1 quarter. So we saw a subsequent boost to Q4 revenue and then we.
We werent able to backfill in Q1, so that drove the number a little bit lower so compete definitely hit.
Hit us a little bit as a result of the mix you see a slightly better margin profile. So it kind of makes sense in terms of pipeline you know I will say the Iot story really is.
Really nice segue.
Secular trend right now it's Ah theres so many.
I'll say silly opportunities, but the opportunities that you don't necessary or applications, you don't necessarily think about where customers are trying to eliminate truck rolls and truck rolls are just incredibly expensive labor shortage is is begging for remote management.
We had a customer come in with a custom project.
Silly application, but being able to power reset commercial.
Commercial machines that are sitting in convenient stores being able to do that remotely would save them.
Close to a million dollars a year, so they're wanting to roll out a system that enables them to do that but yeah. We've got some really eight digit opportunities both in smart cities.
In D O T type applications for municipalities.
Telematics tracking business in the Middle East right now is a digits.
To band remote management opportunities continued to to bear really well for us it's a bit of a lumpy business, but we're looking at a digit or I should say seven digit opportunities with multiple players there, but some some rather large ones.
On the enterprise side, which the sales cycles tend to be a little bit shorter.
Those product life cycles, we are continuing to pick up audio video conferencing applications, one rather large one has given us a verbal.
Award and we expect to start that engagement in terms of development work. This next quarter or this quarter, rather I should say.
That one also would provide good scale, we're talking eight digits are attached to that our work on the automotive front continues to migrate to other EV type platforms.
And so just you know I'm.
Yeah.
So.
Really liked the growth prospects of the company, we're still focused on garnering the scale, we're still marching as quickly as we can to $250 million.
And this year will be a very good start for us in achieving that target.
Perfect. Thanks, so much nice quarter.
Thank you.
Once again, if you would like to ask a question. Please press star and then one to withdraw your question you May Press Star two.
Our next question comes from Harry <unk> from Needham. Please go ahead with your question.
Hey, How's it going I'm just curious quickly if you can just discuss the general market updates and dynamics within market you are seeing.
Changes in macro affect your outlook for certain.
The verticals or geographies.
Okay.
Yeah, I'd say largely our markets are robust fairly robust.
I do think though were.
I would expect to see some pricing pressure.
I am a little bit concerned.
In EMEA in particular, you know the erosion of the euro against the dollar is really kind of raised the cost of goods that territory seeing so I'm expecting.
A little bit of trepidation out of there that is the area that where most of our growth is coming from though in the short term.
It helps to be in applications like smart grid, just as Europe is entering an energy crisis.
The need for upgraded infrastructure to maximize the power delivery and self healing networks in particular on smart grid is is really compelling. So that's driving the investments. So we're lucky or fortunate I should say to be involved in spaces that.
Our infrastructure and are still being invested in but I I am a little bit nervous about the the currency exchange.
With with Europe in particular, and I'm expecting to see APAC pull back a little bit.
As well although.
Most of our revenue is generated out of U S and North America North America in particular.
And EMEA, so not really an overall impact.
But.
Aside from that.
We're still getting quite a few opportunities in terms of that automation I think it's where people are trying to save dollars. They want less people touching something and so they're looking to save costs other ways with technology. So I think it bodes well for us.
Great. Thank you so much appreciate it.
And our next question is a follow up from Christian Schwab from Craig Hallum. Please go ahead with your follow up.
Hey, just a quick one on our $250 million revenue multiyear target it safe to assume that you would like to be operating you know as we kind of think about earnings power of the company.
You know at or near the 50% gross margin range by that timeframe is that fair.
Yes.
Great no other questions. Thanks.
And ladies and gentlemen, with that we'll conclude today's question and answer session.
Like to turn the floor back over to the management team for any closing remarks.
Thank you for joining us today and hope you have a great evening.
And with that ladies and gentlemen, we'll conclude today's conference call and presentation. We thank you for joining you may now disconnect your lines.