Q4 2022 Genesis Energy LP Earnings Call
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Greetings and welcome to the Genesis Energy L. P fourth quarter 2022 earnings conference call at.
At this time all participants are in a listen only mode.
A brief question and answer session will follow the formal presentation.
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As a reminder, this conference is being recorded.
It is now my pleasure to introduce your host Duane Morley. Thank you Mr. Morley you may begin.
Okay.
Good morning.
Welcome to the 2022 fourth quarter conference call for Genesis energy.
Has four business segments. The offshore pipeline transportation segment is engaged in providing the critical infrastructure to move oil produced a long life World class reservoirs from the deepwater Gulf of Mexico to onshore refining centers.
And in minerals and sulfur services segment includes China, and trona based exploring mining process, producing marketing and selling activities.
It was the processing of sour gas terminal sulphur plant upgrades.
The onshore facilities and transportation segment is engaged in the transportation handling blending storage and supply of energy products, including crude oil and refined products.
Okay.
Segment is engaged in the maritime transportation of primarily refined petroleum products.
And this is his operations are primarily located in Wyoming.
In the Gulf of Mexico.
During this conference call management may be making forward looking statements within the meaning of the Securities Act of $19 33, and the Securities Exchange Act of 19.
I'll provide the safe Harbor provisions protection to encourage companies to provide information.
Intends to avail itself of those safe Harbor provisions there actually to its most recently filed and future filings with the securities.
Yeah.
I also encourage you visit our website at Genesis energy Dot com or a coffee and pet as it relates to be issued today as well.
Press release also presents a reconciliation of non-GAAP financial measures the most comparable GAAP financial measures.
I would like to introduce grants.
You know of Genesis Energy L. P.
And this will be joined by Bob Deere, Chief Financial Officer, and Brian you're.
The Vice President Finance and corporate development.
Good morning to everyone and thanks for listening in.
Our market leading businesses continued to perform in line with or actually ahead of our internal expectations in the fourth quarter, especially since we experienced unplanned downtime from several of our offshore customer locations, which negatively affected the quarter by some $10 billion.
For the full year, we generated adjusted EBITDA of $717 million, which was up approximately 25% over our initial 2022 guidance right.
Up approximately 18% over our initial range, even if you exclude the $41 million of nonrecurring income we recognized in 2022.
Importantly, we once again saw a reduction in our quarter end leverage ratio as calculated by our senior secured lenders to 414 times, which is down in less than 15 months from our third quarter 2021 leverage ratio of 551 times and fast approaching our targeted long term leverage ratio of <unk>.
At times.
As we look ahead to 2023, the fundamentals at macro conditions across our business our largest business segments continued to be as positive as we have ever seen them.
We believe this backdrop provides the foundation for us to continue to improve our balance sheet generate increasing amounts of free cash flow from operations and deliver value for every one of our capital structure in the coming years.
We expect to see steady activity levels in the Gulf of Mexico, including New infill development wells in subsea tie back to existing deepwater production facilities for which we are the exclusive midstream provider and.
And we will benefit from a full year's worth of volumes from both chemotherapy and spreads.
So which came on last year and continued to exceed pre drill expectations.
We also expect to finally see new volumes of Argos, which we were told is currently scheduled to start up in the middle of this year.
The soda ash market remain increasingly tied as we move throughout 2022.
Which provided us with a constructive backdrop in the fourth quarter when we finalize the price negotiations on the vast majority of our contracted volumes for 2023.
As we mentioned in our release, we can now report that we have contractually agreed on the pricing for approximately 85% of our anticipated sales volumes in soda ash and related products, including the additional 600000 to 700000 incremental tons from Grainger expected in 2023.
Based on these contracted prices, we expect our weighted average realized price for 2023 will exceed the weighted average realized price we received in 2022.
In our Marine Transportation segment. We are also seeing all utilization as a practical matter for all classes of our Jones Act vessels, which has afforded us the opportunity to drive dayrates for spot and contract charters to levels not seen since 2014 and 2015.
Based on these factors and our increasing clear line of sight, we were again, raising our guidance for 2020 three and now expect to generate EBITDA in the range of $780 million to $810 million.
Prudently we believe this range takes into account the potential negative effects on our financial results.
Significant worldwide recession were to unfold as we move through the year.
To the extent such recession scenario does not come to fruition.
Or either it is milder than modeled or in fact that tailwind from the green transition offset all or a part of the headwinds for like the industrial production and global industrial activity. There could in fact be biased to the upside of even the top end of our adjusted EBITDA guidance range.
This anticipated financial performance positions Genesis with a clear path to increasing financial flexibility and opportunities to continue to build long term value for all our stakeholders.
Portly, we also expect to exit 2023, with a leverage ratio at or below four times.
Given this constructive backdrop, we recently took the opportunity to eliminate our nearest unsecured maturity and extend and expand our revolving credit facility.
In mid January we Opportunistically access the capital markets and successfully priced an offering of $500 million of eight and seven eighths senior unsecured notes due 2030, usually the net proceeds from the new notes to redeem in full our five and five eighths senior unsecured notes due 2024 with the <unk>.
And are being used to repay borrowings outstanding under our revolving credit facility.
Then on February 17th.
Just last week, we successfully syndicated and closed on an extension and upsizing of our existing revolving credit facility with $850 million in commitments for both existing and new lenders.
Notably our new credit facility, we will have expanded general and permitted investment basket, which will give us increased flexibility.
Potentially purchase existing private or public securities across our capital structure that we bought at any given point perceived to be mispriced.
At a high value use of our capital.
We very much value the relationship with our banks and our bank group and are very appreciative of their continued and in fact increased support of Genesis.
Importantly, with these steps we now have no maturities of long term debt until late 2025, and when combined with a clear line of sight to increasing amounts of free cash flow from our operations. We believe we are well positioned with ample liquidity and financial flexibility to comfortably complete the Romanian spend associated with that.
Greater soda ash expansion project in 2023.
As well as complete the construction of the St collateral in their shops expansion projects in the Gulf of Mexico in the second half of 2024.
As we then start to harvest the incremental cash flow from these growth projects along with the continued strong performance of our base businesses. We believe we are in very good shape to begin simplifies our capital structure and perhaps even start looking at ways to return capital to our bond and common equity holders and one.
Former another all while maintaining our leverage ratio at or below four times.
Now I'll touch briefly on our individual business segments.
As we mentioned in our earnings release, our offshore pipeline transportation performed in line with our expectations.
During the quarter, we saw volumes for Murphy Oil's King's key development continue to perform ahead of pre drill expectations and according to Murphy's latest public disclosure.
King's Quay is currently producing approximately 115000 barrels of oil equivalent per day.
From the southern original wells that they're Khaleesi more Martin samurai fields, which is approximately 15% higher than its original nameplate capacity.
Murphy is currently in the process of drilling and completing an additional well if there are several rockville samurai number five well and expect them to bring it online through the cadence keep production facility in the second quarter.
Importantly, Murphy has publicly stated they expect to maintain these current production levels at cadence for roughly three years without any additional field development.
Just to add a little more context to the current upstream economics in the Gulf.
Murphy stated in our most recent earnings conference call. The King's key was down the largest asset within their company.
And they were forecasting full cycle project pay out in the second quarter of 2023 among.
Amazingly just 15 months after first production, which is approximately five years ahead of pay out under the original section these days.
Mind you. This is along with an estimated useful life of the production platform of 40 plus years.
In our current production forecast that runs out through 2040.
Furthermore, they say that if our samurai field alone could be near a 100 million barrels of recoverable oil and then each of the three initial fields connected to teens key have re completion opportunities uphold.
And different ways to peripheral access additional zones, just through opex and to minimize future capex required.
As a reminder, we have life of lease dedications with transport, 100% of the crude oil and natural gas production from kids ski.
And we touch these molecules four times on their way to shore.
The crude oil going through our 100% of the <unk> lateral and then split evenly on our 64% owned shops or Poseidon pipelines for transportation to shore.
And the natural gas is transported through our 100% owned Anaconda gas lateral.
And then on our 26% owned Nautilus system for transportation to shore.
It is safe to say, we've been very encouraged with Murphy's operating performance to date and believe their recent comments would suggest we should see strong volumes from King's key for many many years ahead.
We have also started to receive volumes from all six of the previously discussed new infield subsea wells that were planned for the back half of 2022 in early 2023.
Each of these wells required zero of our capital to come back and each will flow first through a 100% own Genesis lateral.
Project transportation to shore through either of our 64% of owned and operated beside her chops pipeline system.
We are currently seeing about 35000 barrels of oil a day from these new wells with three of the wells currently choked back due to capacity constraints at our host production facility.
All of this does as a practical matter is elongate the time period over which we will see financial contribution from these wells.
These types of volumes and their financial contribution in large part help offset any natural decline of other volumes flowing through our industry, leading infrastructure in the central Gulf of Mexico.
First oil from Bp's operated Argos floating production facility and 14 wells <unk> drilled and completed the Mad Dog two field development is currently expected towards the middle of the year, but we are awaiting final confirmation from BP and their partners.
We continue to expect volumes from Argos will ramp close to its nameplate capacity of 140000 barrels of oil per day over the nine to 12 months subsequent to the date of initial production.
As a reminder, 100% of the volumes from Argos will flow through our 54% owned and operated chops pipeline for delivery to shore and requires zero capital from Genesis perspective.
These larger developments along with other infill development drilling and other subsea tie backs to production facilities connected to our critical infrastructure.
We'll provide a bridge to the next wave of volumes, which includes the approximately 160000 barrels of oil per day.
Production handling capacity, we expect in late 2024, and early 2025 from a recently contracted developments Shenandoah in Salamanca.
The construction of the St collateral and shops expansion to support these new volumes remains on schedule and will further solidify our position as the leading independent provider of midstream services in the central Gulf of Mexico.
As our industry, leading infrastructure in the central Gulf continues to expand we should be well positioned to attract additional upstream developments in the years and decades ahead.
Along those lines, we continue to pursue multiple infield subsea and or secondary recovery development opportunities representing upwards of an incremental 150000 to 200000 barrels of oil per day and the <unk>.
Aggregate they could turn to production on our pipeline systems over the next two to four years, all of which have been identified but not yet fully sanctioned by the operators and producers involved.
The combination of a growing steady and stable base of production.
That was the large scale contracted projects that have or will come online every year from 2022 through 2025 demonstrates the stability longevity and future potential of the deepwater areas of the central Gulf of Mexico and.
And its ability to regenerate itself and support long term stable and growing cash flows for many years and decades to come.
In that vein.
It is interesting to look back at some of the sell side reports on the Investor commentary that was written in 2015, when we acquired the majority of our offshore business, which added significantly to the footprint, where we established in each of 2010 and 2012.
While we had many opportunities to follow the crowd and deploy significant capital onshore we took the contrarian view.
I believe the Gulf of Mexico is and will prove to be the better long term midstream opportunity with almost insurmountable barriers to entry.
A multi generation of our resource base.
<unk> forecast that last decades life of least midstream dedications.
A customer base, consisting of large investment grade operators, along with very large well capitalized private operators and importantly, the fact that the upstream production from the Gulf has the lowest carbon footprint of any barrel of oil produced refined and consumed in the United States.
While we reported on a consolidated basis, we've always tracked separately, what we generate each quarter from the assets we acquired in 2015.
And I can report that in 2022, we realized full cumulative payback of more than our original 1.5 billion dollar investment and now have decades and decades of continued cash flow ahead of us.
There is no doubt it was difficult to not follow the shelf hysteria onshore.
But we understood the opportunity in the offshore and are now the proud owner and operator of an industry, leading footprint with extremely high economic and practical barriers to entry.
Our unit rates per barrel are actually going up not down as we often hear about any onshore and our assets are currently generating some $400 million plus per year and segment margin with clear line of sight to meaningful growth in the not too distant future from multiple contracted growth projects and <unk>.
Cadence of known inventory and to be discovered developments ahead of us at.
Pretty enviable position to be and if you ask me.
Turning now to our sodium minerals and sulfur sulfur services segment.
The bullish macro story for soda ash remains intact as worldwide demand ex China continues to rise at the same time no significant new production that's come on line.
With the cost structure of synthetic production remaining elevated primarily due to its higher energy intensity.
This market dynamic provided a framework for steadily increasing soda ash prices throughout 2022.
With our quarterly contract prices, increasing by approximately 40% from the first quarter to the fourth quarter of last year.
All while Chinese exports were reported to be up some 170% in 2022 versus 2021.
As I mentioned earlier, we have successfully locked in the price for approximately 85% of our anticipated sales volumes of soda ash and related products in 2023, including our new soda ash volumes from Grainger.
Our weighted average realized price for the full year is expected to exceed the.
Weighted average price we received in 2020 to as many customers continue to focus on security of supply versus price.
We will be closely monitoring the reopening activity levels within China.
And might reasonably expect them to mirror those we saw in the United States and the European Union coming out of Covid lockouts.
Their economic activity dramatically increased above long term trend at least initially after a relaxation of the COVID-19 related policies.
In addition to this potential resumption of regular way demand growth within China.
Third party industry reports are estimating significant demand growth for soda ash within China, primarily driven by growing solar glass production, which in large part is driven by subsidies and policy directors Andrew.
It's reasonably and variant to other economic activity.
Solar glass production within China totaled 16 million metric tons in 2022.
But the current installed capacity for 2023 is now at 31 million metric tons. After the startup of three new production lines.
There is potential for a significant increase in demand for soda ash solely from this sector within China in 2023.
These are exactly the types of tailwind as I mentioned earlier that could more than offset any headwinds from a general economic slowdown or recession and elsewhere in the world.
If this indeed plays out.
We could expect this increasing demand for soda ash within China to absorb any excess supply, which could in turn limit Chinese exports of synthetic soda ash and have a positive impact on prices for our open volumes in Asia as we go throughout 2023.
Just to remind everybody generally speaking soda ash demand tracks industrial production.
Which historically has increased by 2% to 3% per year.
In a market outside of China of approximately 36 million tons that would imply growth annually of roughly 700000 to a million times.
If the market is tight.
It is and if there is growth with no or limited new supply.
And the market gets even tighter.
So even if there were to be no growth or limited growth.
The market can easily remain tight.
Just a solar glass production and are reopening and potentially could mean declining export Chinese exports in 23 of our 22, let us not forget the tailwind from electric vehicle production again somewhat policy and subsidy driven in reasonably invariant to other measures of economic or industrial activity.
For instance forecast from Albemarle, the world's largest producer of lithium.
Which suggests the incremental demand for soda ash required just for electric vehicles could add an additional 500000 tons per year of soda ash demand worldwide for the rest of this decade.
This again is another tailwind that could possibly offset any headwinds.
We shall see as we progress through the year.
But there are some indications that offered Chinese export prices are in fact rising.
With limited physical availability of product at those higher prices.
All occurring before the end of the Chinese new year.
And occurring before the full reopening of that economy, and a post lockdown environment.
I'm happy to report that we safely and responsibly restarted our legacy Granger production facility ahead of schedule and had first soda ash on the belt on January one 2023.
We expect production from the legacy Granger facility to ramp over the first part of the year towards the nameplate capacity of 500000 tonnes of annual soda ash production.
Furthermore, our Granger expansion project remains on schedule.
First soda ash on the belt sometime in the second half of 2023.
The net result of our original Granger facility coming back online in January .
And our Granger expansion starting up in the second half of the year means we would expect to have production capacity of approximately $4 2 million tons in 2023, and approximately four 7% to $4 8 million tonnes in 2024 and beyond.
The incremental tons, we expect in 2023 from a greenfield facility should easily be absorbed and welcomed by an extremely tight market as it represents less than one years of expected regular way growth.
It only makes a small debt and the incremental demand from solar panel production in electrification of transportation vehicles.
Based on our current long term supply and demand outlook.
We believe the market outside of China will continue to be tight until at least later this decade, when other announced natural production expansions are planned to come online.
Which we actually know from watching our competitors do not always remain on schedule or come to fruition.
With our existing cost structure at west of acre.
Our soon to be optimized cost structure at Grainger.
And our reserve life of three to 400 years, let me repeat that $3 to 400 years.
We are very excited how our soda ash operations are positioned for the coming years decades, and even centuries.
Our legacy refinery services business continues to be a steady contributor for Genesis.
Primary end markets, we serve specifically copper mining in the corrugated paper market continues to provide us a stable baseline of business. Despite any concerns of a broader economic slowdown.
As we have said in the past the outlook for copper demand remains as strong as ever given us important in the global economy, and specifically the Green energy Revolution for the foreseeable future, especially.
Especially based on the various forecasts of electric vehicles solar panels, and the build out of the electric transmission and charging infrastructure.
The current and expected demand for copper is further evidenced by current copper prices, which are about $4 a pound.
Although this is a relatively fixed margin business for Genesis Reis.
Reasonably invariant to commodity prices.
These high copper prices will continue to support demand for volumes of our sulfur based products from our <unk>.
Copper mining customers.
Combined with the steady demand from the pulp and paper and other industrial applications.
Provide us with steady to increasing results from this business in the years ahead.
This is another of our businesses, we have tracked separately since our original acquisition.
Even though it has now reported consolidated with our soda ash financial results.
It is interesting to note at least from my perspective.
But our refinery services business has generated margin of approximately $68 million per year on average since we first acquired the business in 2007 more than 15 years ago.
Including about 73 million in 2022.
This earnings consistency has been demonstrated through multiple business cycles.
Including the great financial crisis of 2008 to 2010.
And the demand destruction associated with Covid and 2020 in 2021.
While there is certainly some fluctuations year to year. If you look at this business over time, you see well, it's remarkably consistent and there's some.
Ported that tremendous unrealized supply positioning and end market fundamentals.
I think its historical performance is something one must admire.
<unk> has performed across multiple cycles and I believe it has a better and longer term repeatable outlet than most other quarter unquote traditional midstream businesses.
Our Marine Transportation segment continues to exceed our expectations as market conditions and demand fundamentals continue to support activity levels at or near 100% utilization for all classes of our vessels.
The current market dynamic has been driven in large part by the significant reduction in marine vessel construction over the last three years.
And the necessary retirement of older tonnage.
In fact, according to industry publications there were zero.
Zero, new internal heater barges built into all of 2022.
Last year was the second year in a row in which the industry did not take delivery of any heater equipped paperboard.
Which typically are used to transport asphalt or black oil products, such as residual fuel oil.
And which represent our area of focus and expertise with a total of 78 of our 82 inland barges being internal heaters.
The net reduction in a practical supply of Jones Act equipment.
And the lack of new marine tonnage being built because of increased costs in long lead times for new construction.
Combined with strong refinery utilization rates and increase in demand to move intermediate products are five products from one location to another.
Driven spot rates and longer term contracted rates.
Brown water and blue water fleets to levels approaching those last seen in 2014 and 2015.
As we mentioned in the release the American Phoenix recently started as 12 months charter.
But with an investment grade counterparty that will run into January 2024 at a day rate comparable but still below the original rates that commanded when we first purchased the vessel in 2014.
We believe these structural supply issues, along with strong export demand will keep the market for Jones Act tonnage tight even if the U S were to experience a slight to moderate policy induced recession.
As I hope you can tell.
We are very excited about what lies ahead for Genesis and continue to believe the underlying fundamentals and our future prospects are better than ever.
We plan to continue to execute and focus on our strategy of managing our calculated leverage ratio.
To level at or below four times.
Increasing our financial flexibility in utilizing the increasing amounts of free cash flow from operations.
Finalize the spend on our high return growth projects.
We then began to realize and harvest the increasing amounts of free cash flow clearly there for the taking we will look at ways to simplify and to deliver value to everyone in our capital structure.
The management team and board of directors remains steadfast in our commitment to building long term value for all of our stake.
And we believe the decisions we are.
Making reflect this commitment and our confidence in Genesis moving forward.
I would once again like to recognize our entire workforce for their efforts and unwavering commitment to safe and responsible operations.
I'm extremely proud to be associated with each and every one of you.
With that I'll turn it back to the moderator for questions.
Thank you 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.
<unk> Tomo and you keep that your line is in the question queue.
You May press Star two if you would like to remove your question from the camp.
For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys.
One moment, please while we poll for questions.
Thank you.
And our first question is from T. J Schultz with RBC. Please proceed with your question.
Okay.
Great. Thanks, Hey grant.
My first question just on <unk>.
Considering the free cash flow in 2024.
You have some capital to finish up the.
Chops expansion.
It there too.
That capex requirements should be a fair bit lower next year or do some of these additional.
Potential offshore projects require any meaningful capital we should consider.
No I think the lion's share of the what's remaining is going to be spent in 'twenty.
23, there will be some.
<unk> capital spent in 2024, but.
We would expect a significant reduction in growth capex.
In 2024.
As the spend ends in call it second and third quarter of 2004, then we start receiving the.
The revenues associated with the the growth projects and that's where do we significantly turn.
Free cash flow positive.
Okay, and then with the expanded investment basket than the revolver, how are you thinking about.
That flexibility you talked about simplifying the capital structure, just what's the payment the preferreds or where in the capital structure do you consider.
Purchasing securities as debt leverage nodes sub four times.
Yeah, again, I think that's going to be something that kind of unfolds over time as we look a look across the capital structure at expensive pieces of capital and.
Other things but.
Its a good its a high class problem to have the flexibility to do that we very much appreciate the banks are giving us that additional flexibility.
As we move through time.
And get to the.
To get to what we perceive to be the great situation to be in in 2024. After we get these high return Oliver which are less than five times multiples on it on a build basis, we start harvesting that cash.
We will look at.
It's simplifying the capital structure and taken out expensive pieces of capital in it.
It made it all the time managing the debt.
As calculated by our banks to at or below four times.
Okay makes sense.
If I can just shift gears real quick one or two on operations you talked about the.
So volume uplift from the samurai well that can be turned to production in two Q.
Just any estimate on volume uplift there and then for our modeling.
How ratable should I consider the ramp on the Argos.
Get to that name plate capacity.
You know again, we're dealing with the situation that King's key as is.
Already operating that above almost 15% above design capacity.
So in reality, there probably will not be a net uplift from the samurai number five but rather.
All of the seven wells that are there will be somewhat constrained but still.
Forming well above pre drill expectations.
And the main reason that they are able to.
Exceed the design capacity is because the strength of the reservoirs are such that they're not saying that they're seeing limited about some produced water at this point and so what's coming out.
Strict.
Hydrocarbon flows which is a very good thing just indicates the longevity and the long term quality of the reservoirs that they are developing here relative to Argos.
As we said Theres 14 wells pre drilled.
And we could expect them at least in historical perspective, but they're pretty drilled or completed that mechanically.
You could.
Reasonably expect that it would take two to three weeks.
Round terms too.
Fully tie in and mechanically get go well going so once.
Once they're confident in their ability to start ramping up production, we kind of believe that it should be a fairly.
Fairly rapid ramp in these wells again are anticipated to on average be call. It 10000 barrels a day.
Wells.
Given that they've got 14 pre drilled or even greater.
Accordingly, the other thing from a scale point of view about the Gulf of Mexico is that the the recoveries eur's from most of these wells are anticipated to be in the 20 to 25, even 30 million barrel plus per wellbore.
To give you an idea of the scale so.
Each one of these wells is the equivalent of call it at least.
<unk> 30 of about 40.
Onshore shale wells.
Okay, I'll make sense I, just lastly on soda ash you have.
Nice to have locked in higher year over year for 2023.
Can you just remind me what's locked in beyond this year and then what would be open to setting contracts at the end of this year.
Including the Granger expansion understanding.
Clearly the view you have after the market to remain tight.
Yeah.
All good questions. We continue to have a series of.
Yeah.
<unk> contracts that go out over time in.
A number of them have been reset into this world or this price deck and are subject to caps.
Caps and collars on a prospective basis.
Others.
Some residuals are kind of locked in.
At 2020 pricing or 2021 pricing in which case, we need to get to the end of the three to four years. So their primary term in order to reprice them up so.
That's why everything doesn't go immediately up.
Given the nature of our contracts but.
We feel very comfortable.
Where we are as we intimated to it.
It sure feels like a disappointment I agree we're only 45 days into the new year, but.
It feels very comfortable that the prices could actually.
Hold steady or even continue to increase as we go throughout 2023 and that is.
If that indeed turns out to be the case, then we will.
Over the coming quarters, we will be adjusting our annual guidance up if that turns out to be the case.
Okay. Thank you.
Thanks TJ.
As a reminder, if you would like to ask a question. It is star one if you will.
Like to remove your question it is star two.
As there are no further questions at this time I would now like to turn the floor back over to grant Sims for closing remarks.
Again.
Thank everybody for participating whether or not your ear live or you're going to hear it.
On the tape delay but.
We're very excited about the company and the prospects that we have in 'twenty three and beyond.
We look forward to sharing that with you in future calls so thanks, everyone.
Thank you. This does conclude today's teleconference. You may disconnect. Your lines at this time. Thank you for your participation.
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