Q4 2022 Alpha Metallurgical Resources Inc Earnings Call
Speaker 1: We pride ourselves on finding solutions to problems and I believe these two new departments will prove beneficial to the company in the immediate near term but also especially in the years to come.
Speaker 1: Turning now to labor, the third challenge I listed. We invested significantly in our workforce to retain the exceptional professionals already a part of our team and to attract others to join. We've also invested in training with nearly 200 employees completing our Red Hat Apprentice minor program and another 50 completing electrical training within 2022. As a result, we saw our overall turnover rates ticking downward as the year developed and we seek to continue that progress through 2023. We plan to continue building on this momentum across all three of these areas which I believe will allow alpha to be better prepared for whatever the rest of the year may bring. Strategically, as we look ahead to priorities for the near term, we will continue to protect the balance sheet, maintaining the cash and liquidity targets we've discussed. For free cash flow above these levels, we remain committed to share repurchases as the most value creating focus for our capital return program. The Board just increased the share repurchase authorization by another $200 million bringing the total authorization up to $1.2 billion.
Speaker 1: Given the significant fluctuation in the indices over the last 12 months, we're reminded of the cyclicality of our industry and the ongoing need to manage costs. This is true in any pricing environment, but it's especially important in times where the indices moderate, leaving less for us to capture a margin that could fuel the operational and capital return priorities we've set.
Speaker 1: Therefore, we remain committed to cost management to ensure that we are well positioned for any processing environment that may develop. In short, we're actively managing alpha to control what we can, and mitigate what we can't. And we remain excited about our market share production capabilities and solidifying our role as an industry leader.
Speaker 1: So with that, I'll turn it over to Todd for discussion of our financial results.
Speaker 1: Thanks, Andy. We preannounced our financial results due to the previously discussed geological and transportation challenges that dampened our fourth quarter 2022 results in what was otherwise an exceptional year, as Andy mentioned.
Speaker 1: Fourth quarter adjusted EVA dial was $248 million, which was down from our third quarter level of $296 million.
Speaker 1: We sold 3.9 million tons in the quarter, 3.8 million of which came from our MET segment and 100,000 tons from the all-other category.
Speaker 1: Our quarter over quarter realizations improved slightly for the MET segment as a whole, with an average realization of $186.29 for the fourth quarter as compared to $184.31 in Q3.
Speaker 1: Export met tons priced against Atlantic indices and other pricing mechanisms in the fourth quarter realized $196.88 per ton, while export coal priced on Australian indices realized $183.59.
Speaker 1: Our fourth quarter realization for our metallurgical sales was a total weighted average of $190.94 per ton, essentially flat against the prior quarter's $191.17 per ton.
Speaker 1: Realizations in the incidental thermal portion of the MET segment increased quarter over quarter coming in at $146.24 in Q4 as compared to an average of $119.69 per ton for Q3. This higher realization reflects the increase in thermal pricing for the period when the tons were sold.
Speaker 1: Fourth quarter realizations in the all other category were $126.10 per ton up from $109.27 per ton for the third quarter. Again, a reflection of the temporarily improved pricing environment for thermal coal which has since fallen off.
Speaker 1: Cost of cold sales within our MET segment increased to $112.97 per ton, up from $104.86 per ton in the third quarter.
Speaker 1: This increase includes higher than budgeted labor costs due to incentive bonuses paid to employees across the organization.
Speaker 1: to reward our team for a year of excellent performance.
Speaker 1: Cost of coal sales in the all other category rose to $80.76 per ton, up from $67.48 per ton in the third quarter, due again in part to high labor costs, but also higher sales-related costs for thermal coal, resulting from an improved pricing environment.
Speaker 1: as well as the impacts of late stage mining at our slab count mine.
Speaker 1: S-GNA, excluding non-cash stock compensation and non-recurring items, increased to $19 million in the fourth quarter as compared to $13.6 million in the third quarter. The increase is primarily attributable to incentive bonuses paid within the quarter as well as higher professional fees. Fourth quarter rad?? at hand before ??orma clubs AGT conference 2019 series CF-RE,
Speaker 1: was $61 million, up from $33.3 million in Q3.
Speaker 1: Moving to the balance sheet and cash flows, as of December 31, 2022, we had $348 million in unrestricted cash and short-term investments.
Speaker 1: down from $404.4 million at the end of the third quarter. We had $93.1 million in unused availability on our AVL at the end of the year.
Speaker 1: Alpha had total liquidity of $441.1 million as of the end of December , which is net of the $127.8 million in share repurchases during the quarter and $84.7 million in deposits in Q4 related to the special and quarterly dividends paid in early January .
Speaker 1: $1 million in Q3.
Speaker 1: In total, ALFA generated $1.48 billion in cash from operating activities in 2022.
Speaker 1: As of December 31st, our ABL facility had no borrowings and $61.9 million of letters of credit outstanding down slightly from the prior quarter.
Speaker 1: We are pleased with our committed position for 2023 sales.
Speaker 1: 38% of our metallurgical tonnage in our MET segment is committed and priced at the midpoint of guidance at an average price of $195.89.
Speaker 1: Another 38% of our 2023 met tonnage at the midpoint is committed but not yet priced.
Speaker 1: The thermal byproduct portion of the MET segment is 52% committed in price at an average price of $119.79.
Speaker 1: and we are almost fully committed in price, 97% for this year in our all other category with an average price of $94.08.
Speaker 1: Looking now to our dividend program, ALFA's board has declared a quarterly cash dividend of 44 cents per share, an increase from the prior quarter's 41.8 cents per share, which will become payable on April 3rd for holders of record as of March 15th.
Speaker 1: In terms of share repurchases, we have continued to buy back shares of our common stock and in the fourth quarter 2022 we repurchased 813,000 shares at a cost of $128 million.
Speaker 1: Since the beginning of the program through the end of January 2023, we have spent approximately $560 million to acquire 3.8 million shares of Alphas Common Stock.
Speaker 1: at a weighted average price of $145.54 per share.
Speaker 1: The outstanding share count has been reduced by nearly 18% from the time the program began.
Speaker 1: As of January 31, 2023, the number of common stock shares outstanding was approximately 15.3 million.
Speaker 1: As Andy mentioned earlier, Alpha's board increased the buyback authorization by $200 million, bringing our total authorization for share repurchases.
Speaker 1: to $1.2 billion.
Speaker 1: Before I hand the call over to Jason, I want to make a quick comment on the recent actions of the Department of Labor and their newly proposed regulations related to collateral requirements to secure self-insured federal black loan obligations.
Speaker 1: If adopted, the new regulations could substantially increase alpha's required collateral. Under the DOL's proposed 120% minimum collateral requirement, we estimate we could be required to provide approximately $80 to $100 million of collateral to secure certain of our black lung obligations. For more information, visit www.dol.com
Speaker 1: While a portion of this could be covered by third party bonding or other non-cash arrangements, we will continue to monitor this process and its potential impact to our balance sheet.
Speaker 1: I will now turn the call over to Jason for some details on operations.
Speaker 2: Thanks, Todd. Good morning, everyone.
Speaker 2: I want to start with a shout out to the 2022 Best in Class winners. You all showed great leadership and set the bar even higher for this year's competition. Congratulations again to Glen Allen Tunnel for winning the Underground Mine category, Mar 4 for winning the Underground Belt Transfer System category, and to the 2019 Best in Class winners.
Speaker 2: for our best loadout facility. We're all proud of our best and class winners.
Speaker 2: From an operations perspective, the end of 22 was exceptionally busy.
Speaker 2: As we've disclosed, there were some geologic and transportation challenges that hampered our fourth quarter results.
Speaker 2: But we've taken a number of steps to mitigate those challenges. Based on January numbers and what we're seeing so far in February , I believe these issues are mostly behind us.
Speaker 2: One way of looking at this is through our inventory levels at Dominion Terminal Associates Facility in Newport News, Virginia.
Speaker 2: As you know, roughly two-thirds of our met production is funneled through our DTA facility.
Speaker 2: Due to a number of factors, including supply chain shortages, transportation availability, power outages and interruptions, the holiday schedules, and other timing concerns, we had an inventory trough at DTA of approximately 47,000 tons in December .
Speaker 2: Since then, we've grown that about tenfold to a more appropriate level of working inventory of shippable coal that we expect to ship to customers in the coming weeks and months.
Speaker 2: This time it pairs up nicely with the movement and the indices that with the OCPLV moving up roughly 34% over the last two months.
Speaker 2: and Platts U.S. East Coast low vol moving up 25% over the same time period.
Speaker 2: One of the highest priorities for us as a management team is to proactively protect our ability to continue the basic operations of our business.
Speaker 2: Most, if not all of our businesses went through the dramatic supply chain issues stemming from COVID, but as some issues resolved, it became clear to us that others were more structural and may not resolve themselves.
Speaker 2: Therefore, we decided to step in and vertically integrate our Maxim rebuild division, which has historically worked to rebuild underground mining equipment. Now two new departments have been created, Maxim Manufacturing and Maxim Transportation.
Speaker 2: We established these two new aspects of the company to address very real problems within the supply chain for certain equipment parts, like gear cases, and in the trucking of our coals to preparation plants and loadouts.
Speaker 2: In the case of maximum manufacturing, we acquired certain assets of industrial plating and machine.
Speaker 2: at Bluefield, West Virginia. We have worked with them for some time on essential mining equipment components, and now we have bought these operations in-house to optimize our part supply.
Speaker 2: Turning to the new trucking division, maximum transportation.
Speaker 2: As we analyze some of the bottlenecks in our ability to efficiently get our coal from point A to point B, we recognized a significant opportunity to acquire our own trucks and run our own logistics planning to best utilize the transportation options available.
Speaker 2: Over the course of a few small transactions, Alpha now has acquired roughly 75 on-road coal trucks and we employ a team of drivers to move our coals from the mines to the preparation plants, loadouts and barge facilities.
Speaker 2: While it's natural to experience a few hiccups in the early days of acquisitions like these, both Maxim Manufacturing and Maxim Transportation are meeting our expectations and present further value-additive opportunities as we look ahead to how we might use additional integrations to complement these efforts.
Speaker 2: I want to again welcome these new team members to Alpha. I want to thank the current employees who have worked tirelessly to get both of these ambitious goals accomplished in a very short period of time.
Speaker 2: Lastly, I want to briefly mention our newest mine currently in development.
Speaker 2: Rolling Thunder. This is a highball mine in West Virginia that we expect to take its first cuts this summer. We are excited about the possibilities this mine will bring due to its proximity to our existing operations and we'll keep you updated on the progress as we move ahead.
Speaker 2: With that, I'll turn the call over to Dan for some additional information on the markets and our sales efforts.
Speaker 1: Thanks Jason and good morning everyone.
Speaker 1: The global economic landscape hasn't been especially favorable over the last several months, with metallurgical coal markets being influenced by prolonged wartime impacts in Asia and Europe as a result of Russia's invasion of Ukraine.
Speaker 1: Slowing steel production across the world and persistent inflationary pressure have also contributed to current market dynamics.
Speaker 1: Heavy rain and flooding in Australia interrupted coal production and exports within the fourth quarter, and the recent earthquake in Turkey has also been extremely unfortunate.
Speaker 1: China's December 2022 reversal of its years-long strict zero COVID policy and its decision to ease its ban on Australian coal are two additional factors that may shape metallurgical market trade flows in the coming months.
Speaker 1: Given all the negative news across the world and the poor economic indicators, coal markets appear to be somewhat of an anomaly with indices moving upward significantly in recent weeks.
Speaker 1: Specifically, looking at fourth quarter price movements for metallurgical coal, the Australian Premium Lowball Index increased from $270.50 per metric ton on October 1st.
Speaker 1: to $294.50 per time they year in.
Speaker 1: The U.S. East Coast High Ball Index increased from $270 per metric ton on October 1st to $278 per metric ton at the end of the fourth quarter. The U.S. East Coast High Ball A Index moved from $287 per metric ton at the start of October to $275 per metric ton at quarter close. The U.S. East Coast High Ball B fell from $284 per metric ton to $274 on December 31st.
Speaker 1: In recent weeks all of the aforementioned indices have increased from their year-end levels.
Speaker 1: As of February 21st, the Australian premium lowball index was $388 per ton and the U.S. East Coast Lowball Index was at $342.
Speaker 1: The U.S. East Coast High Ball A index was at $325 per metric ton, while the U.S. East Coast High Ball B was at $310 per ton.
Speaker 1: While many in the metallurgical markets are assessing the potential impact of China's decision to again allow the import of Australian coal, as well as the country's reversal of its zero-COVID policy, Alpha believes that we are well positioned regardless of those two key changes in China's approach.
Speaker 1: As you know, Alpha opportunistically sold roughly two million tons of coal into China in 2021, but it has never been a key market for us, and we are not counting on business in China for our future plans.
Speaker 1: Certainly, if China engages in significant industrial and manufacturing growth, that will serve as a positive catalyst for the metallurgical coal industry broadly.
Speaker 1: However, there is speculation among some economists about the kind of growth that China may undertake, with some suggesting it may hinge more closely on services as opposed to infrastructure investment.
Speaker 1: Time will tell, but we remain confident in our approach regardless of that outcome.
Speaker 1: Turning now to the thermal coal market, where pricing has very significantly fallen off from the highs of last year. The API2 index started the fourth quarter of 2022 at $310.85 per metric ton and ended the year significantly lower at $190.50 on December 30.
Speaker 1: The softening trend has continued through the first months of 2023 with this index at $135.85 per metric ton as of February 21st.
Speaker 1: I will close as I usually do with a quick comment about real performance, which has been very good of late. I will close as I usually do with a quick comment about real performance, which has
Speaker 1: We appreciate the efforts of the railroads to address their labor shortages, which appear to be largely resolved.
Speaker 1: ALFA has seen performance at or close to pre-pandemic levels in recent weeks, and we look forward to continued positive collaboration with our railroad partners.
Speaker 1: And with that operator, we are now ready to open the call for questions.
Speaker 3: Thank you. At this time we'll be conducting a question and answer session. If you'd like to ask a question, please press star 1 on your telephone keypad.
Speaker 3: One moment please while we poll for questions. Our first question comes from Lucas Pipes with B. Riley Securities. Please proceed with your question.
Speaker 4: Thank you very much operator and good morning everyone. First off I do like the name Rolling Thunder and I think it would be a good name for your shared repurchase program as well. So my first question is in terms of cost inflation could could you come in a bit on?
Speaker 4: what you would put into the cyclical bucket, what you would put into the more structural bucket. I assume labor, for example, could be a little bit more structural, but would really appreciate your perspective on this. Thank you very much.
Speaker 1: Hey, Lucas, it's Andy, and I do love your idea if we're going to stick a label on the repurchase program. That is pretty good.
Speaker 1: I think from a cost perspective, and I'll let Jason throw in any extra color, both the labor and the supplies area seem to be a little bit sticky as far as how long they may stick around. Naturally, we always feel like we're at the tail end of cyclicality. The market comes down and then...
Speaker 1: It takes a lot for that to flush through to the cost side for us. You know, again, we have such labor constraints. It makes it rather challenging to do too much in that regard until things do come off a bit.
Speaker 1: For the near term it feels like the cost structure kind of is what it is But we'll just have to wait and see where the markets go again the volatility That we're seeing is not really being helpful as far as planning But for right now I think we're just expecting kind of expecting kind of a static view on cost outside of the sales related obviously But Jason anything you want to add? I mean well said Andy. You know I think
Speaker 2: And secondly, we'll be looking to streamline things and do things more efficiently than they've been done in the past. So look forward to reporting out on that in the future.
Speaker 4: Thank you very much for the color.
Speaker 4: leads a little bit into a higher level question and when I hear your comments about bonding requirements for a black line for example or the acquisition on the equipment side I also hear benefits of scale and obviously you have
Speaker 1: tremendous scale already, but does this make the case for more M&A in the space? I'm curious to get your perspective on that. Yeah, I think we've been talking about this for a few years now where consolidation does make sense. The problem is just the way the sector is currently structured.
Speaker 1: It's really hard to value each other.
Speaker 1: particularly as related to how we are currently valued by the market. So if you look at current spot pricing.
Speaker 1: and you apply that to alpha for four years, you're looking at something probably sub two times on EBITDA, and that just seems extremely cheap. And so you have to compare that to potential synergies and scale economics for doing transactions, which will obviously be offset by integration risk. It just...
Speaker 1: I think it's really difficult to justify any M&A at these current levels, any sizeable M&A. I mean, naturally, we're always, I think we said before, we have a door is always open approach to smaller bolt-on things. But I think right now, generally speaking, the main acquisition we're focused on is acquiring more alpha stock.
Speaker 4: That's super helpful. Thank you very much Andy. And then final question, I'll turn it over. With the 61% of Metcoal that is still left to be sold, could you provide a quality breakdown? Maybe I missed that and maybe just put a bow on it. What would you expect?
Speaker 4: those tons to garner back at the mind gate at today's market prices. Thank you very much. Sorry Lucas, were you asking about the the uncommitted or the... Correct, yeah, yes, yeah. So I think you have 39% committed so the 61% that are uncommitted.
Speaker 1: Yeah, I'll let Dan throw some color here, but unfortunately, we've locked up the crystal ball today, so making guesses on that is virtually impossible. I think generally speaking, we probably don't have too much of a quality differential among the spread of what we've booked versus what we've not booked, but I'll let Dan speak more to that.
Speaker 5: Yeah, good morning Lucas. I'd say across the quality spectrum, high vol, mid vol, we still have some of those tons to place. We'll find our opportunity. Some of the market...
Speaker 5: I'll make a comment on that. I will say that a lot of our larger customers have locked up more term business than they have in the past, especially in Western Europe . That's due to the the unavailability of Russian coals flowing into Europe for steel making. So you know we see
Speaker 5: good demand for our coals, including highballs into Europe the rest of the year.
Speaker 5: And then the rest of it, we have many customers who just roll out and buy a quarter at a time.
Speaker 5: you know, on a regular cadence there. So we'll sell chip those times.
Speaker 5: you know, pretty regularly through the year. And you know, you can do the math as well as I can. You know, you take the indices today and you back that. You asked about the price at the mine. You know, today's pricing, if you go back to the mine, you're in the $235 to $250 range today. You know, I'm not saying that's what we'll achieve on every ton of coal, but that's where they sit today.
Speaker 4: Very helpful. Really appreciate all the color. Great work and continue best of luck.
Speaker 3: Thanks, Luke. Our next question is from Lance with Cowan & Company. Please proceed with your question.
Speaker 6: I've been on for land.
Speaker 7: My first question is, given that 38% of your expected met output for the year is already priced, do you share if this is largely set for delivery in the first and second quarter of the year, or is it spread throughout all four quarters? For more info visit 20 historians dot com.
Speaker 5: Well, the domestic portion is rateable through the year. Some of our contracts are rateable through the year and some are a little more front-end loaded. It's literally all of the above. Okay. All of the above. I would say that we might spend Doctoriam Storri, not Doctor Maldraji, I think, who we don't
Speaker 7: All right. Can you give us a bit, the $2 incentives per ton for the discretionary incentives to employees, was this a one-time occurrence just given the challenges that were presented in the MIES during the fourth quarter, or is this something that we can expect going forward?
Speaker 1: Yeah, this was something where, again, we had to step back as a management team and look at the year that we had and combine that with the
Speaker 1: the staffing environment that we're living in and it felt appropriate to grant some of these bonuses. And some of these are just part of the standard program. There was some discretion that we also utilized. But this is one of those things where if you have a record year, you know, giving a portion of that to the employees to reward them for just a tremendous amount of...
Speaker 7: Yes, I agree. That's a good strategy. Great.
Speaker 7: In terms of the carryover CapEx that's going into 23, is this primarily going to be spent in the first quarter and therefore we should expect CapEx in the first quarter to be the highest of the year?
Speaker 1: No, I think this generally it probably...
Speaker 1: I think it will probably end up being pretty radical throughout the year because again, supply change is not completely unclogged and so some of our original plans for 2023 may also start sliding into 24. So generally speaking, it's kind of a broad mix of different items of equipment or rebuilds or whatever the case may be. So I don't know. There's highly, highly unlikely.
Speaker 1: it hits in Q1 or really in the first half, I think it'll be kind of a peanut butter spread.
Speaker 2: the first half, I think it will be kind of a peanut butter spread.
Speaker 7: And the last one for me, I know that rolling thunder mine is still in process, but how many additional tons can we expect to, on a narrow basis, to come out for that mine to yield? The one that we have to look at frequently?
Speaker 2: Hey, this is Jason and I'll take that. For this year, we plan on, as we said, taking development cuts starting in the summer and we expect south of 200,000 tons this year and it's really more about a sustaining mine for some other operations with the ability to bolt on. And you know, I can say that.
Speaker 2: this mine's capacity would be in the million ton of year range.
Speaker 7: So then that 200 expected tonnage. Yes. Yeah. Is that already baked into the guidance or is that something that can be on top of?
Speaker 2: Yeah, it's in the guidance for this year and it's like I said, it really hits its strut in 2024.
Speaker 3: Okay, thank you. Thank you. As a reminder, if you'd like to ask a question, please press star 1 on your telephone keypad. One moment while we poll for additional questions.
Speaker 3: Our next question is from Nathan Martin with the Benchmark Company. Please proceed with your question.
Speaker 3: Our next question is from Nathan Martin with the Benchmark Company. Please proceed with your question. Hey, good morning, everyone. Thanks for taking the questions. This is Nathan Martin with the Benchmark Company.
Speaker 8: Bye, Nate.
Speaker 9: Jason, just real quick on Rolling Thunder again, I think you said Hyvol Mine. I appreciate the other color you just gave. Is that going to be an A quality product or a B quality product or somewhere in between?
Speaker 2: Yeah, Nate, it's a good B. coli. I mean, it's a good cocon-cola. It's got good properties.
Speaker 9: Okay, great. Appreciate that color. And then I want to come back to the cost side. The MET segment cost time for guidance maintained at 106.112. You guys put that target out there obviously before the run-up of MET prices we've seen the last couple months. So just curious if you could give us an idea of what MET prices you assume in that range and if you have any kind of sensitivity to the MET price that would be great.
Speaker 1: Yeah, we typically don't throw that out there, but you can kind of figure about the time that we put that guidance out. We were using the current strip.
Speaker 1: or the future strip to kind of inform where we thought 23 was going. I don't recall off the top of my head where it was at that point in time, because that was where the math was going, probably.
Speaker 1: 250-ish, maybe 270 range, something in that ballpark for all the PLV.
Speaker 1: And to the degree that this market continues, naturally, the impact from sales related, and as Jason mentioned, we are seeing some improvements from other portions of direct costs at the mines, along with some productivity improvements that we're seeing that will offset some of that. If the market holds, we may...
Speaker 1: We may see some adjustments to that number throughout the year, but at this point we're still comfortable with the range as it was published.
Speaker 9: I appreciate those thoughts. Andy, it would also be great to get you guys' thoughts on the cadence of shipments as we move through the quarters this year. I mean, should we expect things to kind of improve quarter of a quarter here in the first quarter to a more normal run rate as logistics hopefully improve, or will there still be some time to kind of ramp up from those fourth quarter challenges? And then.
Speaker 9: Could you also remind me maybe how to think about the timing of the other thermal shipments as well, given, you know, slab can't due to mineout, I believe. Hey, Nate, this is Dan. I'll answer the last one first. The cadence on the thermal should be fairly routable through the year. It shouldn't be any.
Speaker 5: you know, well, let me say this, it'll go up in the summer months due to the burn and come down a little bit in the shorter months, as usual, nothing unusual there. But generally, ratable, and with regard to the Met shipment cadence, again, I mentioned earlier, domestic will be flat through the year, we have some.
Speaker 5: domestic business that doesn't begin until the lake season opens here in April , so probably a little higher there. And as far as seaborne, the coals that we have under contract are generally going to be raidable. We'll see, hopefully we'll see continued uptick in the blast furnaces relighting here over the next several months. We kind of feel at least today that...
Speaker 5: The worst is behind us there that steelmaking growth should continue through the years. And certainly we believe it will in India and some other markets.
Speaker 9: I appreciate those comments there, Dan. And then maybe just one final one. A couple of mentions of labor constraints within the industry. You guys are expecting to kind of grow your production this year. Do you feel confident getting to those levels with your current labor force? I mean, you're going to necessitate any additional
Speaker 2: that we initiated I guess about 18 months ago and you know we continue to bring fresh new faces into the industry and we also have some some minds that are retiring you know that are larger and kind of long in the tooth and you know as we transition
Speaker 2: those miners into brand new operations that are smaller and frankly take less employees to maintain. You know, I feel like we're in relative pretty good shape to where we've been.
Speaker 9: Great. I'll leave it there. Appreciate the time and information guys and best of luck in 23.
Speaker 9: I'll leave it there. I'm going to leave the time and information, guys.
Speaker 3: We have reached the end of the question and answer session. I will now turn the call over to Andy Edson for closing remarks. Thank you, operator. Thanks to everyone who dialed in or logged in online for the call. We appreciate your interest and we hope everyone has a great day. This concludes today's conference. You may disconnect your lines at this time.