Q3 2022 Rockley Photonics Holdings Ltd Earnings Call
Notes and warrants.
We ended the quarter with $4 9 million in cash cash equivalents and investments in the fourth quarter, we completed a private placement retaining up to $24 $5 million of incremental funding with.
$10 million received at closing plus an additional $14 5 million.
Ah proceeds placed in an escrow account for release out the direction of the note holders.
A full summary of our financial statements is available on our website.
I'd like to start by introducing Randy Maura.
New President and CFO .
Randy joins us from intersect Ent's, a medical device company that was recently acquired by Medtronic.
He brings experience in finance and operations leadership with healthcare therapeutics and medical device companies.
Randy will focus on our financial and commercial strategies are more lead our finance supply.
Supply chain quality.
<unk> and compliance functions.
He will ensure a cash efficient performance, while enabling a ramp towards commercial production I'm delighted that Randy chose to join us as I believe that he brings the discipline needed.
Head of our commercial ramp.
Today I'll talk briefly about three aspects of our business.
Our customers, our technology and our human studies.
Then I'll turn the call over to Randy.
As you know we have 19 customers in the consumer Wearables in Med Tech markets, representing six of the <unk>.
<unk> largest wearable companies and two of the five largest med tech companies.
We are working with all of our customers on increasing our engagement with them and in doing so we.
We will enable them to run trials using our products.
Solidifying that product requirements for rocky and our solution.
We are working with our customers on several use cases, including patient monitoring clinical trials.
Health and wellness monitoring lifestyle management pharmaceutical on fitness.
Recently, we received our first biotechs bonds from our manufacturing partner.
This near final version will provide the core biomarkers for a solution.
Our first solution will be for general health and wellness and sold to customers for certain use cases, including general health and wellness clinical trials fitness loan workout and other non diagnostic applications.
In terms of our regulatory strategy.
We plan to introduce general health and wellness solutions to our customers.
We believe there's a market for non clinical use cases.
This will make our products available to our customers sooner satisfying their needs for solutions that are non invasive monitoring key concerns.
Working in consultation with our med Tech customers, we plan to pursue regulatory approval for our solutions in the U S. By seeking five 10-K clearance for those biomarkers with existing predicates and de Novo classification grounds for our novel Biomarkers without existing present case.
During the quarter, we advanced our development of the buy optics and Biotics pro versions of our solutions.
I believe we are on track with both.
We continue to work on next generation <unk> sensing technology as well.
In the quarter, we announced on Nextgen higher density laser spectrophotometer chip.
We believe that this is the world's first microphones that printed lasers on silicon photonics for commercial applications.
In the future. We believe this capability will allow us to further increase the density and reduce the size of our photonics chips as well as lowering manufacturing costs.
This breakthrough will allow us to create even smaller solutions opening up even more opportunities for ultra smooth wearables to health monitoring, including <unk> AR and VR headsets.
Clothing classes.
Other form factors.
We received funding support for this work from the Science Foundation.
And the disruptive technologies and innovation fund narrow I'll talk about our human trials in the third quarter, we expanded our studies of core body temperature hydration and blood pressure with larger follow on studies of these key biomarkers.
We recently announced that following promising initial results we are expanding our free living study two larger sample population. These free living studies continue to test the capability of our Biotics bio sensing bound to remotely monitor and measure biomarkers outside of laboratory and controls.
Thank you.
These studies should be completed in the fourth quarter of 2022.
Finally.
We recently announced the results of our internally control blood pressure human study, where we demonstrated what I believe are very important results for our company and also for individuals who will benefit from a device that provides irregular.
Effortless monitoring of blood pressure.
Many people suffer from hypertension, often without knowing it making it a risk factor for serious health problems, such as heart disease and strokes.
This quarter, we will begin our first third party control blood pressure in human study, which will monitor 200 participants and will include isometric and aerobic exercise based protocols.
Additionally, and in line arterial study with them.
<unk> monitoring catheter reference with 30 participants is also planned in the period.
Turning to the future.
We have three priorities for the remainder of 2022.
Our first priority is to sample the biotics units to our customers for that tranche.
The next we plan to complete third party controlled human studies for blood pressure.
Which will form the basis.
So the design of.
A FDA study.
And finally, we plan to utilize our biotechs pro module.
For in House Human studies on alcohol glucose and lactate biomarkers.
The initial study will utilize our pro module and bench top based human studies, which will lead to studies utilizing a wearable device in the future.
These priorities will form the foundation for.
For 2023, as we scale our technologies.
I am very pleased with the tremendous work that we've been doing and what we've been able to achieve.
I believe that our work is truly extraordinary and has the potential to change People's lives for the better.
What we've been doing isn't easy.
And I know that some may wonder if we will achieve our goals.
As I sit here today I believe that we will succeed due to the increased body of evidence gathered prolonged human studies, which validate the performance of our technology.
We are at the point, where we will soon have commercial products in our customers' hands and I'm confident that this will be a game changer for us.
Now I would like to introduce you to around <unk>, our president and CFO Randy.
Thank you Andrew and good afternoon, everyone I'm thrilled to have joined Rocklin and the opportunities that lay ahead of us.
In the third quarter revenue was 556000 revs.
Revenue for the quarter was solely related to nonrecurring engineering services from our customers.
Revenue was recognized based on mutually agreed upon.
Formats obligations and acceptance.
Cost of revenue was $2 1 million.
<unk> and a gross profit loss of $1 5 million. It is important to note that expenses are recorded as incurred even if revenue has not been recognized.
Third quarter R&D expenditures were $25 7 million a slight decrease from a year ago due to a reduction in third party engineering expenses and other professional services.
R&D expenditures in the second quarter of 2022 were $26 3 million.
In the quarter SG&A expense were $13 million, a slight decrease from the $13 6 million in the third quarter of 2021.
The sequential reduction from the $21 2 million in the second quarter of 2022.
The sequential reduction was primarily a result of a reduction in professional and deal fees offset by slight increase in personnel costs due to severance payments.
Cash used in operating activities in the quarter totaled $37 3 million during the quarter the company implemented programs to preserve capital and reduce future cash burn.
This included a reduction in workforce of approximately 50 positions the.
The impacted positions were not directly focused on the immediate commercialization of our buy optics bio sensing solutions.
The company also reduced spending on programs that were not directly focused on commercializing the current technology.
Company ended the quarter with $4 9 million in cash cash equivalents and investments.
During the quarter the company did not access funds from our HELOC.
As a reminder, we continue to believe that we will receive additional funds from a U K R&D tax credit.
Subsequent to the end of the quarter.
The company closed two financing transactions on.
On October three 2022, the company issued $12 4 million in aggregate original principal senior secured bridge notes.
Then on October 25th 2022, we issued approximately $96 million in aggregate original principal convertible senior secured notes due in 2026 along with warrants.
The proceeds were used to repurchase all of the bridge notes and 50 million of convertible senior secured notes issued in May of 2022.
The net result provided the company with access to funds of approximately 25 million of which approximately $10 million was received in cash and after payment of fees expenses.
Approximately $14 5 million is held in escrow to be released to the company with the approval of the note holders.
For the full year 2022, we believe our revenue will be in the three two to $3 $6 million range. This revenue assumes the company achieved certain customer milestones.
Upon the achievement of priorities Andrew spoke about earlier on the call. Our plan is to provide our outlook in the first quarter of 2023.
Finally, I'm pleased to join Andrew and the dedicated team Irakli.
Look forward to working with everyone and realize our goal of bringing a revolutionary technology to market or the general health and wellbeing of our customers around the world.
We have a great deal of work ahead of us, but the future is insight.
I'll now turn the call back over to the operator.
To open up the call for questions.
Thank you.
Ladies and gentlemen, we will now be conducting a question and answer session. If you would like to ask a question. Please press star one on your telephone keypad and a confirmation tone will indicate that your line is in the Q you.
You May press Star two if you would like to remove your question from the queue for participants using speaker equipment and may be necessary to pick up your handset before pressing the star keys.
Can we please poll for questions.
And our first question comes from the line of Quinn Bolton with Needham <unk> Company. Please proceed.
Hi, guys. Thanks for taking my question I guess my question really focuses on cash flow and the balance sheet. While your technology is impressive the balance sheet has become pretty stressed.
Cash is still at a pretty significant.
Loss per quarter, and so I guess ive got sort of three questions one.
Randy you mentioned, taking some actions to reduce costs on a quarterly basis can you give us some sense.
What's the expected Opex run rate post those actions or what should we be thinking about on a quarterly EBITDA level second question, if I do the math.
You started the quarter with just under $5 million on the balance sheet. It sounds net of financing transactions, you raised 24, and a half, but your cash burn seems to be higher than that per quarter, and so where are you from a financing perspective to raise additional funds.
And how much do you think you need to raise to get to cash flow breakeven and then lastly can you give us some sense, where they're fully diluted share count comes because it looks like there are a significant number of shares underlying the recent convertible and warrant transaction sorry for all the questions, but hopefully you can address those three points.
Sure.
First of all I appreciate it.
You're asking your question and look forward to.
Working with everyone as we move the company forward.
Look I think the company is certainly in a position to move forward in an aggressive fashion.
As we indicated in our.
Our comments.
We've dramatically.
<unk> taken steps to reduce.
The overall operating cost of the company.
And more importantly, really focused the company on a handful of items as Andrew outlined.
That we will deliver prior to year end.
In doing so.
That will position us as we indicated to work with our advisor Jefferies <unk> company to continue to.
Raise some capital and move the company in a direction to continue to create.
Value in the future.
At this juncture, we're not going to be providing any guidance relative to <unk>.
What our cash burn is right now I think obviously.
<unk> done the math appropriately in terms of the.
Cash on hand at the beginning of the quarter as well as the capital that we raised.
Suffice it to say that we've taken dramatic actions to manage ourselves so that we can.
Position ourselves to effectively continue to deliver.
On our technology promises and effectively communicate with potential investors to raise capital.
Moving into the future.
In terms of your fully diluted share count.
Certainly the share count.
Today is about 132 million shares outstanding and will be filing our Q tomorrow, so that will be reflected in that.
Tough to tell you what our fully diluted would be in light of all of the.
Financings, there's a number of warrants and we converted billety would make under certain circumstances would certainly further dilute the shares.
But we will keep you posted on that but we do expect our fully diluted.
As of the end of the quarter Youll see is about $170 million.
And the shares outstanding today are basic level would be about 132 million shares.
Yeah.
So I guess, maybe if you don't want to give a cash flow projection can you give us some sense of where Opex may may trend in the December quarter, and then a follow up question I know you've been awaiting some.
U K R&D tax credits is that something you think or have line of sight to potentially receive here in the December quarter or is that something that you think may push into early next year. Thank you.
Sure again, I think we had a as we indicated in the press release.
Operating expenses in aggregate, a little less than $39 million in the quarter.
Clearly.
That run rate is going to be reduced and has been reduced dramatically.
Since we're not giving our guidance here, which is we feel comfortable that we can operate comfortably.
Through the end of the year and into next year.
And certainly we will continue to look to opportunities to bring in additional capital.
Moving forward.
And as far as the <unk>.
Consideration.
Continue to work with.
The U K government and to secure the tax refund.
So far we've got favorable responses from them and.
And we will continue to work with them to recover that.
In terms of timing.
Yeah.
That's anyone's guess.
Still confident that we will recover it.
But.
Projecting what.
Our current covenant is going to do is not what we're in the business.
Understood. Thank you for that for that color.
Sure.
Our next question comes from the line of Tristan.
Sir Please proceed.
Hi, This is Tyler on for Chris and Thanks for taking the questions on the consumer side of the business have you seen any delays or cancellations in projects given the weak macro environment.
I will tell you that Randy.
No we've not seen any any.
Cancellations.
<unk> got two programs with our consumer customers they will continue.
Okay, Great and then as my follow up.
Are you seen any pushback from the medical device companies and consumer OEM adoption, given that that could bring competition to their medical devices.
We are not because.
The consumer field.
We don't see the consumer customers, taking on if you like but kind of.
Regulatory risk associated with for example in hospital.
Medical uses so the two markets.
Don't appear to compete with each other.
Okay, great. Thanks for taking the questions.
Thanks Tyler.
Our next question comes from the line of Paul Silverstein with Cowen. Please proceed.
Thanks.
Andrew I've got a bunch of related questions.
The new role.
Here's thru market confusion, so I thought I understood from 90 days ago.
That you would move the consumer wearables to the.
<unk>.
Back burner.
You had said that you were focused on.
Medical.
Devices, given the far better economics, Rockwood I assume it wasn't what I assume part of the decision was driven.
The balance sheet challenges that you currently have.
Questions for you.
Are you all still pursuing and so its been expanding.
Considerable or decent amount of financial resources on pursuing the consumer wearable opportunity.
Or are you still actively engaged with those consumer wearable companies because theres still a prospect of revenue being generated from any of them and in connection with that correct me if I'm wrong, but if I went back to as recently as September of last year.
You were talking about it we've been number was $63 million of inner ear money, which I assume was especially investments by one or more of a wearable companies.
Circular as they pursue commercializing your technology.
That clearly from your guidance is not in the 'twenty two number.
Let alone the 30 plus years erosion reference for 'twenty three.
What if anything does that is that a function of the fact that the consumer wearable companies are no longer meaningful pursuing solutions with our technology I'm just trying to understand is 98% of your focus now on med Tech.
Or is it more balanced can you help me understand.
It's <unk>.
It's more balanced pool.
And if we are agnostic if you like to the utilization of the technology.
What we.
What we were able to achieve over the course of this year was to dramatically accelerate.
A wearable device a biopsy comparable device for the med tech market it still needs to be.
FDA approved regulatory approved.
But it has traction in professional applications.
And with trials with customers that will ultimately utilize it in medical applications and so on.
We've accelerated that piece of it now what goes into that if you like professional wearable in terms of the spectrophotometer chip and the associated Asics and.
The algorithms and all the human studies et cetera is the same as it would for a consumer.
And we have not stopped working with any of our consumer customers and we continue to pursue them.
In terms of timing.
Our owned by Upticks band for the professional markets.
Is it in this period in this quarter ready for customers to start the trials with and so that is way ahead of where we expected.
Ah.
Back at the beginning of the year in terms of the consumer customers, obviously that timing is dependent on them, taking our devices, putting them to the design in process into their devices in them when they launch those devices and we are not making any.
Providing any update on that other than to say that we continue to work with all of the customers that we were previously working with.
Does that help with the specific questions between Med Tech.
And consumer.
Kind of.
Andrew I'm, not trying to be argumentative, but.
390 days ago you.
<unk> asserted that given the far better economics.
Jack.
And again I assume there was a balance sheet aspect with that drove you to focus and prioritize heavily.
Med tech piece of the equation and to place the consumer through <unk>.
This opportunity really on the back burner.
It wasn't in parallel yes.
But maybe it was my misunderstanding.
Okay.
If one if one thinks about the.
The development of the devices.
And the development of the technology not only have you got all of the hardware and obviously the revolutionary Silicon Photonics spectrophotometer capability in these devices, but you also have to conduct human studies to chase to train the algorithms to complete if you like the solution and that's what we've been doing we've been doing.
That very successfully and we've been validating our algorithms.
We're really really excited about the results of the latest one that we published was blood pressure, which is a huge breakthrough.
And so for any customer whether it be professional med tech consumer you need that complete solution. So how should we look at those bonds.
The biopsy expense that we have just about launch that those biopsy expands.
Essential for the professional market are central for the Med Tech qualified regulatory market essential before all of that as.
As the platform that allows us to continue to develop and validate the algorithms through human studies.
If you will the reference designs for the consumer for the consumer companies.
Alright, just to be clear a sustained module both med segment consumer.
The differences.
Packaging, Europe , and med tech market, you're designing the entire.
Device the entire volume.
Yes, I understand.
Stack on top of that I'm curious a question if I understand in a room money correctly.
What happened to the plan and are your investments by various I think there was more than one big.
Big one plus others.
Just to reference what happened was planned and already investments.
Why did they go away. They are clearly have gone away or non your 'twenty two numbers I assume youre not in 'twenty through either I know you haven't announced went through.
What happened why did they go.
So.
We'd have to go back cafe through the numbers that you're referring to but I think what youre, referring to may include the salary that was associated with the commercialization of the platform in fiber optic communications.
And if you recall.
The partner had tone.
Preliminary findings.
Andrew Let me interrupt you that's not what I'm, referring to I'm, not referring to the Datacom business I'm, referring to the <unk> money.
It was.
BBVA company, plus one or one or more other companies in the consumer wearable device market unless my memory serves me.
So on.
Not in a position to comment on the quantum of the salary other than to say that all customers in the.
We've been engaged with with regard to <unk>, we continue to be engaged with those customers and we continue to work with those customers and we continue to invoice those customers.
But we shouldnt read anything Brian again, I'm, just trying to understand we shouldnt read anything from the fact that whatever those reinvestments were point whatever those planned investments were apparently no longer are present at this point in time, there is not a read through from that.
Paul Let me just jump in here and maybe I can help clarify some things as we indicated in the revenue mostly in <unk> or <unk>.
We generate revenue based on meeting certain milestones and certain qualifications and think what Andy is saying is we continue to work on a number.
The attributes and the technology and the additional biomarkers.
We continue to work with a broad spectrum of customers.
On delivering those technologies and Biomarkers.
And so the opportunities haven't necessarily gone away. It's our focus we have decided to focus on certain things related to.
The med tech or the clinical market.
More so than others in terms of where we are and how we're allocating our resources today.
That doesn't mean, we aren't continuing to have conversations with customers across the consumer and professional and clinical a med tech side as well.
That will enable us to advance the technologies commercially.
What you May see is a different relationship with the consumers having us go to market.
Directly.
With one of our devices may not be appropriate and leveraging someone that's already in the consumer market.
Maybe the more appropriate way to go to market.
As Andrew indicated.
There is a lead time to that they integrate our technology into their designs.
What we're focused on today is delivering the three priorities that we talked about which will certainly advance our ability to.
Talk to customers in the patient monitoring segment of healthcare.
Certainly the blood pressure cardiovascular segment of healthcare and certainly with glucose asphalt lactate certainly there is a whole before and well developed market around diabetes and other areas that we can go to market with that's really where we are today and our focus and we think that will enable us to create the most value over the next six.
Six to nine months.
Sure.
And we will continue to pursue every other hour to monetize the existing technology.
Through our existing customer relationships. So hopefully that gives you a little more clarity to what we're trying to do yeah. I. Appreciate that one last question on this line metal pass them on.
As far as all or virtually all of your R&D and SG&A investment today focused on med tech zero or very little.
<unk> as one would expect it in the balance sheet pressures.
Well, what I think.
Differ on the technology side of this back to Andrew, but I think what we're saying is to get to.
Med Tech offering you have to go through.
The unregulated qualifications that professional qualifications and then the clinical studies to deliver.
Qualified clinical device.
Yes, that's where we're focusing most of our energy because of the margins in a specific market opportunity that exists there, but along the way that doesn't preclude us from talking to other customers and having them either into a co development arrangement or an NR rearrangement.
To pursue other avenues to generate.
Avenue to into the company.
And the studies you referenced earlier, you're currently in clinical studies or you're in the preclinical studies you Havent gone through the clinical yes.
I think the difference between sort of a biotech orientation, where you'd be in sort of preclinical and clinical studies on the med Tech side, you initiate human studies, so we would be.
And the studies that we are validating technologies in humans. So that we can proceed to the FDA to develop a clear line.
Two an approvable device in a clinical setting.
If everything goes perfectly according to plan with the minimum amount of time, but it would be required before even the most commercially.
I think at this point.
We'll probably be updating folks on with our outlook in early 2023.
So probably we're not going to.
Give line of sight to that right now.
Understood.
Here to you Andrew.
On the technology side of things.
Yes. Thank you. Thank you Randy I think we said in our release that.
Half SL.
Associated with the.
Regulatory approval.
And so we are preparing for that as we as we've expressed in the press release.
Yes.
Thank you Dan.
Our next question comes from the line of Tim <unk> with Northland. Please proceed.
Hey, good afternoon, just following up on that a little bit I mean, you talked throughout the year about gearing up for a volume.
Production ramp kind of into Q4 and next year, obviously, that's that's been pushed back to some degree but.
Wonder if you might comment on where we are relative to that.
Initial expectation and then if the sample volumes that you referenced going into your med tech customers in 'twenty three.
Equate to.
Some degree of production volumes in your view.
I think that was the original expectation so.
How has that changed and.
If you could give us some indication of.
What you mean by sample volumes I guess.
Okay. Thank you Tim Brian did you want to take that.
Sure.
I think as we just indicated with the shift in focus and clearly some balance sheet constraints.
We are clearly focused on delivering the quantity.
Product.
That we believe our customers will need in terms of Trialing and sampling the device.
And positioning our site hotel to go through a process to get to a.
<unk> finished good if you will our new product development.
Development, which shouldnt be too far down the road.
So I.
I have less visibility into what some of the prior expectations were.
In terms of.
Overall production in terms of unit volume.
But we're taking a much more modest approach here in the fourth quarter and into the first quarter of next year is really to deliver the quantities necessary to personal foremost needs.
Some.
Customer demand to Trialing and sampling.
And meet some of the human study trials that will need to fulfill both on the blood pressure side of defense as well as as we pursue glucose alcohol and lactose.
Rather modest in terms of overall volumes.
But I think adequate enough to meet the current demand.
Meet the future expectations, we need into developing our data to move the company forward.
Okay.
Okay.
And it looks like about a 20% head count reduction should we be banking on at least that for <unk>.
Reduction to Opex run rate.
It for me.
Yes.
<unk>.
I think in terms of trying to draw a line of sight from head count reduction.
To sort of other operating expenses and third party expenses.
There's a little bit of a swag just because.
The talent that we have resident in the company.
<unk> is really focused on the technological development.
More so today than say.
Just a.
Typical manufacturing workers.
So you'll probably get a little bit more bang for your Buck in terms of some of the rationalization of the company entered into.
But we continue to monitor very closely.
The costs.
And the resources that we have.
To deliver on our priorities right now so.
Not sure it would be 20%.
But clearly with the available resources, we're going to have to manage.
Our income statement pretty tightly.
Our next question comes again from the line of Quinn Bolton with Needham <unk> Company. Please proceed.
And just a follow up to Tim's question. When you talk about sample volumes or is that sort of in the thousands of units is it tens of.
Thousands of units I think in the past when you talked about the CE opportunity.
<unk>, we're probably in the 10 to 30000 my guess is that's probably.
It's going to be lower on the medical device side of it but just kind of wondering if you could give us some sense as to Tim's question, what does sample volume Spain.
Then as you prepare or your customers prepare for trials.
Who will do those trials on lactate and glucose are those going to be effectively funded entirely by rockley or will you be selling the biopsy expand to the medical device customer, who and then goes out and does some of the trials for.
Lactate glucose and.
Alcohol. Thank you.
Okay shall I take that.
Yes sure go ahead.
Sure so on the volume side.
Customer trials.
That validation trials.
Typically in the hundreds to thousands of units.
On the.
Qualification for the development of.
And verification of the individual buyer.
Biomarkers the algorithms for each biomarker.
The way to be preceded there is that we do internal human studies.
This human studies basically allow us to.
Measure of subjects with our devices, while measuring them with the gold standard for the particular biomarker.
We are developing the algorithm for.
And that's how we developed algorithm and through those.
Identical studies, that's how we validate the algorithm, but one of the things that we've.
And this this period that we're doing is we're doing independent independently.
Third party run trials to validate for example, the blood pressure.
Concord.
No.
<unk>.
And to position ourselves and with third parties, which I know that customers that with people that we've contracted.
To develop and deliver the completed algorithms for all of the Biomarkers and so the customers' activities are focused on.
Validating for themselves.
Device, if you like means what it says on the on the Chin.
That said because this is.
It's an instrument on your wrist.
Not limited by the number of Biomarkers that we've already mentioned, we're not limited in terms of metabolites to just glucose and lactate through a more.
We are in a position to collaborate with our customers.
With with other parties as well to develop additional.
Biomarker.
Algorithms for additional Biomarkers.
In the future so our customers.
You have expressed in could participate in.
In those activities.
Great and to say that a couple of things.
But.
The internal.
Data collection and the independent.
Studies that we're initiating now validate the technology.
What that enables the company to do is to potentially partner with.
Third parties to do clinical study that's an option that we do have going forward. So again to answer your question a little bit more clearly.
When we get to those clinical studies or.
There is an opportunity that we could partner with someone that we could do it ourselves.
A variety of different ways, we could go to.
To market with us.
Great.
Randy just in the guidance for the fourth quarter of I think about 400000 at the midpoint. It sounds like that's all still in our read that Theres no meaningful by optics band production in the fourth quarter. It sounds like by up to expand is probably early next year.
Yeah.
The incremental.
Guidance that we gave for the fourth quarter.
It would be consistent.
With the revenue that we generated in the third quarter.
And my understanding is that.
Consensus was a bit above that so that we thought we'd just.
Clarify that a little bit, but I would agree with your.
Our point of view of where the revenue would be coming from.
Thank you.
Thank you.
Ladies and gentlemen, we have reached the end of the question and answer session I would like to turn the call back to Andrew Rickman for closing remarks.
Thank you all for joining us on our call and we're looking forward to speaking to you throughout.
The quarter and at the next earnings call. Thank you very much everybody.
This concludes today's conference you may now disconnect. Thank you for your participation.