Universal Electronics Inc. Q1 2023 Earnings Call
Yeah.
Yeah.
Good day and thank you for standing by welcome to the Universal Electronics first quarter 2023 financial results Conference call.
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I would now like to hand, the conference over to the Speaker today Kirsten Chapman. Please go ahead.
Thank you Jules and thank you all for joining us for the Universal Electronics 2023 first quarter financial results Conference call by now you should have received a copy of the press release, if you've not please contact <unk> Investor Relations at 4154333777 went to visit the Investor Relations section of the website.
This call is being broadcast live over the Internet a webcast replay of this call, including any additional updated material nonpublic information that might be discussed during this call will be available on the company's website at www dot.
Com for one year.
During this call management may make forward looking statements regarding future events and the future.
Performance of the company and cautions you that these statements are just projections and actual results or events may differ materially from those projections.
These statements include the company's ability to timely develop and deliver new technologies and technology upgrades.
<unk> introduced this year, including meeting the demand of interoperability.
[noise] across devices platforms and ecosystems in the home.
The timing and extent of the recovery of the consumer electronics channel is believed by management.
Achieving the new product development successes as anticipated by management, including in the H D C market and its groundbreaking line of ultra low power and energy harvesting controls products designed to address the growing demand for more sustainable solutions and electronic devices.
The continued successful collaboration with existing and new customers and developing and launching next generation products software solutions and technologies into existing and new growing markets.
Which result in increased sales and market share.
For the company.
The ability to optimize the company's manufacturing operations.
And to the extent expected by management.
Management's ability to continue to manage its business inventories and cash flows to achieve its schools of net sales margins and earnings through financial discipline operational efficiency manufacturing footprint and utilization strategies and product lines and business diversification management.
The decline of the company's market capitalization and consequent to the impairment of the company's goodwill.
The impact of the company's financial results that it may experience during the supply chain constraints.
Inflationary pressures and macroeconomic conditions.
Sewers.
King.
The direct or indirect impact the company may experience with respect to the business and financial results stemming from the continued economic uncertainty affecting consumers' confidence and spending natural disasters public health crises, including the continuation or resurgence of COVID-19, pandemic or governmental actions including war.
The company undertakes no obligation to revise or update these statements to reflect events or circumstances that may arise.
After today's date and refers you to the press release mentioned at the outset of this call and the documents the company files with the SEC, including its 2022 annual report on Form 10-K.
In management's financial remarks, adjusted non-GAAP metrics will be referenced management provides adjusted non-GAAP metrics because it uses them for budget planning purposes, and for making operational and financial decisions and believes that providing these non-GAAP financial measures to investors as a supplement to GAAP financial measures helps investors evaluate <unk> core and financial.
Performance and business trends consistent with how management evaluates such performance and trends.
In addition management believes these measures facilitate comparisons with the core operating and financial results and business trends of competitors and other.
<unk>.
A full description and reconciliation of adjusted non-GAAP measures versus GAAP are included in the company's press release issued today.
On the call today are chairman and Chief Executive Officer, Paul <unk>, who will deliver an overview and chief Financial Officer, Bryan Hackworth, who will summarize the financials. Paul will then return to provide closing remarks, it's now my pleasure to introduce Paul are like please go ahead Sir.
Thank you for joining us today.
For the first quarter of 2023.
We met the high end of our guidance for net sales and earnings neither of these measures reach our standards for long term financial performance.
So we are executing strategies to diversify our markets and realign our global operations in particular, optimizing our manufacturing footprint.
While you're experiencing headwinds in our home entertainment channels, we continue to see growth in sales and market share in the connected home market.
As we have discussed previously we are leveraging our foundational competitive advantages, our innovation and device control and connectivity technology, our excellence and new product development and our commitment to providing a great customer service.
Solving the consumer demand for interoperability across devices platforms and ecosystems in the home is a core foundation of enabling a truly smart home experience.
Which is exactly what we are bringing to our customers in the climate control automation and security markets.
These areas will continue to grow in the long term driven by underlying macro trends such as global warming rising energy costs and the need for smarter and more sustainable product solutions.
However, near term, our new product and customer successes have yet to fully offset the sales decline due to subscriber loss in subscription broadcasting, particularly in the U S.
<unk>, our consumer electronics customers are also experiencing near term order declines driven mainly by economic weakness in the consumer or retail channel.
We believe the impact in the consumer electronics channel is temporary and we expect TV sales to recover as the battle for the primary operating system for entertainment and information in the home escalates.
In this regard we are extremely well positioned with our key accounts and are working to help bring new features and more sustainable solutions to the OEM brands that lead this industry.
Looking at our current backlog of customer programs as well as our product development pipeline. We believe net sales will hit their low watermark in the first half of this year. We are actively refocusing our product development efforts to align with current market dynamics that will help us achieve better sales results later this year.
And into next.
What has been encouraging is that even while we were in a period of higher levels of consumer uncertainty. The number of project design wins in both new and existing accounts is accelerating.
The majority of which are for new products, representing incremental sales growth versus replacement business.
As we have mentioned before sales and development cycles in these new channels are typically longer.
Subsequently these new product design wins are expected to contribute modestly modestly to sales in 2023.
And then drive topline growth in 2024.
More importantly, these design wins give us great confidence that our differentiated solutions and technical capabilities are key assets that will return us to growth and profitability in the not so distant future.
In our HVAC channel, we can now boast seven major brands as customers.
<unk> lead these brands represent over 30% of the world's HVAC market.
Many of the newer accounts represent design wins achieved in the past six months and reflect key new products that will drive global customer penetration in the industry.
We've won new major awards with leading brands like Daikon carrier and Mitsubishi Trane.
For their more advanced connected thermostats.
In addition earlier this year our teams kicked off customer initiated developments.
For several smart thermostat solutions based on our tight dial and tied touch platforms scheduled to ship in Japan, Europe and other markets in 2024.
These important design wins validate our product roadmap efforts for this channel, which we started nearly two years ago and offer a positive view for the future.
The success, we are achieving in the HVAC market is strikingly reminiscent of the earlier phase of success in home Entertainment.
We focused on gaining traction through project wins with the leading companies in the World. We then executed on those wins innovated further in our products and technologies and as a result, one even more business with leaders in the industry.
Our keys to success are stronger today than they have ever been.
Our ability to execute at scale for our customers and provide connectivity and importantly, interoperability across an increasingly chaotic smart home infrastructure is proven through our history with some of the largest companies in the world.
These attributes are strongly desired by our customer base as they look to become more integrated into the smart home of today and tomorrow.
And our home security and automation business. It is a similar story, we are adding to our small but growing customer base, attracting new customers and increasing customer share with our new product design wins for our controllers sensors and other home automation products with leading brands like Finland, Hunter Douglas and <unk>.
On fee.
Product introductions will begin later this year and ramp into 2020 for these.
These accounts have expressed a strong commitment to bring more product opportunities to us as a result of their initial exposure to our superior technical Knowhow innovation and customer engagement experience.
Even in our video service provider channel earlier. This year, we secured major program wins for new television streaming platforms in the U S and Europe that we will begin shipping later this year due to the shortened the design and development cycles inherent with these products.
As is the nature in our business, we can't provide more details surrounding these customer platforms right now, but rest assured we will continue to expand our market reach even in this more subscriber challenged market.
Turning to a review of our plan to optimize our manufacturing footprint worldwide to manage the changes in the global supply chain and governmental policies, we have been working on expanding our manufacturing footprint outside of China.
Last year, we started building a new energy efficient and sustainable factory in Vietnam that will provide additional capacity.
Once it is running at near optimal levels, we plan to ramp down our manufacturing volume in China and reduce our overall manufacturing overhead as we transfer volumes out of our other facilities.
Although we will temporarily experienced continued overcapacity our plan ultimately will lead to an optimization of our global supply chain footprint, taking into account the adjustment in product mix.
And monthly volumes across channels as we continue to transition our business into newer markets with lower volumes and higher asps.
With all of these wins and actions underway. We are confident we will return to long term growth and profitability.
Now I'll turn the call over to our CFO Bryan Hackworth for a review of the financials. Please go ahead, Brian . Thank you Paul first I'll review the results for the first quarter of 2023 compared to the first quarter of 2022.
Net sales of $108 4 million at the high end of our expectations. This compares to $132 4 million for the first quarter of 2022, reflecting headwinds in the video service channel.
As well as an uncertain economic environment, which have led to household spending less on discretionary goods and ultimately affecting our end user markets.
Gross profit for the first quarter of 2023 was $27 6 million or 25, 4% of sales compared to 28, 9% in the first quarter of 2022.
The decrease in our gross margin percentage is due primarily to under absorbed manufacturing overhead and lower royalty income associated with the slowdown in TV sales.
As Paul mentioned, we're taking steps to restructure our factory footprint and eliminate manufacturing inefficiencies all.
Elaborate as I mentioned before for a variety of reasons ranging from the enactment of certain governmental policies to changes in the global environment over the past five years, we expanded our manufacturing footprint evolving for producing finished goods solely in China to expanding and converting our Mexico factory from refurbishment.
To a full production plan to.
To now ramping up production in Vietnam.
Today, as we focus on diversifying our business into higher growth markets and becoming less dependent on the video service channel we've.
We've seen a shift in product mix towards the climate control and home automation categories.
And these newer channels the average selling price for thermostats wireless controllers and security products is significantly higher than products and our video service provider channel.
Consequently, less factory floor space will be required per sales dollar.
Our restructuring plan will enable us to lower our concentration risk in China to eliminate excess manufacturing overhead costs and ultimately return gross margins to a normalized rate.
Our goal is to reduce our cost structure by approximately $15 million.
And with sales growth return, our factory utilization rates to upwards of 90% with a flexibility to expand as needed.
The first step in the plan requires that we establish a manufacturing facility in Vietnam for the past two quarters, we've been hiring and training and manufacturing personnel at our Vietnam facility.
We're currently awaiting to final permits, which we expect to receive in may and at which time, we can begin production.
Once we've reached a level of operational efficiency in Vietnam, which we estimate to be in October of this year, we anticipate that we'll begin the process of shutting down our southwestern China factory.
Thereby reducing our manufacturing footprint in China from two factories to one.
The third phase of our restructuring effort will be to streamline our operations and Monterrey, Mexico, resulting in a smaller and more efficient manufacturing footprint to meet production volumes for North American customers.
We expect this transition to take place in the back half of 2024.
Operating expenses were $31 2 million compared to $30 4 million in the first quarter of 2022.
SG&A expenses were $23 1 million compared to $23 million in the prior year quarter.
R&D expenses were $8 1 million compared to $7 4 million in the prior year quarter.
Operating loss of $3 6 million compared to operating income of $7 8 million in the first quarter 2022.
Our first quarter of 2023 effective tax rate was 19, 9%.
With the first quarter 2022.
For the first quarter of 2023 net loss of $3 5 million or <unk> 28 per share compared to net income of $6 1 million or <unk> 47 per diluted share in the first quarter of 2022.
Next I'll review, our cash flow and balance sheet.
Our March March 31, 2023, cash and cash equivalents were $56 9 million compared to $66 7 million at December 31, 2022.
Cash flows used by operating activities were $2 million for the first quarter of 2023 compared to $18 million in the prior year quarter.
In regard to our Atlanta credit, we extended the maturity of our $125 million credit facility with U S Bank for November one 2023 to April 30th 2024.
Now turning to our guidance for the second quarter of 2023, we expect sales to range from $105 million to $115 million compared to $139 1 million in the second quarter of 2022.
We expect net loss ranging from 15 to 25 cents per share compared to EPS of <unk> 66 cents per diluted share in the second quarter of 2022.
Looking at the second half of 2023 based on the expected timing of our new product introductions and customer forecast. We continue to expect net sales for both Q3 and Q4 to exceed Q2 net sales.
I'd now like to turn the call back to Paul.
Thanks, Brian .
Our strategy our strategy to address the new market dynamics and to rebuild the UI into a stronger company better positioned for growth and profitability is progressing although economic pressures and the longer product development cycles in our newer markets inform us that sales impact will likely be gradual in 'twenty three with a greater effect beginning.
In 2024, our team is innovating winning business and maintaining <unk> long standing position as a leader in consumer device control, we are committed to creating products and technologies that help everyday consumers easily discover and interact with the devices and services in their home.
We know with our healthy product development pipeline sales opportunity conversion and strong customer relationships, we expect to return to long term growth.
As always stay tuned.
Operator, we can now open up the call for questions.
Thank you.
At this time, we will conduct a question and answer session. As a reminder to ask a question you will need to press star one one on your telephone and wait for your name to be announced to withdraw your question. Please press star one again.
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Please stand by while we compile the Q&A roster.
Yeah.
Our first question comes from the line of Gregory Burns from Sidoti.
Your line is now open.
Thank you Ken.
Get the 10% customers to start off.
Yes, sure Daikon, Comcast dike and came in at 18, 1%.
And Comcast came in at 13, 6% for the quarter.
Yes.
Alright, and then.
It seems like with the where the quarter landed and where you're guiding for the second quarter.
A little level of stability.
A little more stability into the.
The subscription broadcast market.
Do you feel about the outlook there now based on what you are.
Seeing in terms of what the what the customers are communicating to you in.
Where are the inventory levels in that channel.
Yes.
Yeah.
Do you feel like we've reached kind of a near term plateau.
Yeah, Greg it's a difficult one to answer because obviously it will vary customer by customer we did have some customers whose purchases.
We're lower than what they've communicated to us their needs were which means what they did was they were using inventory for deployment. So they were ordering less than they would otherwise need for deployment.
But as we all know.
Can't do that forever.
Company needs to buy.
By enough to deploy over the long term your purchases are equal to your deployments. So.
So we did have a few of our customers that we noticed that and spoke with them and they in fact confirm that that was going on.
Certainly subscriber counts, though are down.
This has has hurt our business overtime.
Because new additions are the biggest source of.
Volume for us.
New additions of course take multiple units per installation.
There is repair and replacement business people do break or lose their amounts, we love dogs and children because they.
I'd like to carry remotes, often chew them, but so there is a repair and replacement business.
We have seen some customers reach what we believe to be probably a longer term more stable.
The level of volume.
In other words they.
Subscriber.
Accounts have been less impactful on them because they have already gotten to a point, where they've they've dropped off in purchasing and it's leveling off so it varies by customer.
But one thing we would say is that.
Over the next couple of years.
Our growth is likely to come from.
As.
These new channels and as I highlighted in the prepared comments. We now have won business with again strangely reminiscent to the home entertainment business, we blind aligned with seven of the largest in the world I think it's actually five of the top eight.
We won projects with them and as it begins you win one or two skus.
And then as you perform on those.
Our awarded more this is exactly what we did in home entertainment.
And these companies control again, almost one third of the HVAC.
Units worldwide, so, we're making quite a bit of progress in.
And getting quite a bit of traction.
On on wins in that market, we do think that that part of our business. The smart home part of our business non home entertainment is probably where the most growth is going to be experienced.
And as I said, the consumer electronics goes through this from time to time, we've been in it for a long time, we've looked at data going back decades, the TV market is not.
High growth it never grows 30%.
It goes into the high single digit growth rate and then in some periods. It shrinks right now, we're probably going through that that shrink.
Because of the economy retailers have not stocked up.
They have a little bit of a.
<unk>.
Outlook over the next number of months, but TV is going to be inactive market for us in the years to come there's a real battle emerging as you've probably seen in the press as far as TV is concerned there is a lot of major companies going into this most of whom are aligned with.
So I think this is going to be an interesting few.
A few years ahead of us, but it will go through periods for quarters, where it'll it'll be difficult and then after that it grows.
So we're not long term concerned about consumer electronics.
Alright, Thank you sure.
Alright. Thank you so much please standby for our next question.
Our next question comes from the line of Brian Ruttenberg of Imperial capital.
Your line is now open.
Great. Thank you very much.
First question I have is about.
Your cash and balance sheet.
What do you expect it to look like in the.
And the second quarter the end of the second quarter cash was obviously down in the first quarter.
Your debt with download bit where do you see things shaking out in the second quarter.
I think it's going to be similar I think when you deal with cash flow on a quarterly basis, sometimes it can be difficult to forecast and one of the reasons why we don't give quarterly forecast on it because you can have a customer that's.
Here's an example that scheduled pay you $5 $6 million on it.
At the end of the quarter and they can easily push out couple of days and actually now that falls in the following quarter. So on a quarterly basis its difficult, but overall I would say I expected to be similar.
And in Q2 as in Q1.
Great and then in terms of.
Demand typically seasonally you have your best quarters in third quarter.
What have you seen in terms of third quarter I know that you are only getting to the second quarter.
Can you give us any kind of visibility into that third quarter of that key quarter.
Yes, as Brian said, we expect we.
Don't give that forward guidance.
Of course did provide a range of guidance for Q2.
So we don't we don't provide we never have.
Really actually it's been more than a decade I think since we provided guidance out further.
But.
So I can't say, we've never done it, but we haven't and probably at least 10 years I think.
But Brian did say that we are right now what are what our forecasts say base.
Based on customer wins, and customer forecasts that Qs three and four will be better than Q2.
Alright.
And will those.
I guess I'm going to ask one more question that you're probably not going to answer but do you see those.
Down.
Inefficiently year over year can you give us any kind of color on <unk>.
As a percentage first and second quarter were down X, Therefore, third and fourth quarters will probably be down a similar.
Year over year I didn't know if you could give us any kind of color for the rest of the year.
Yes, it really couldnt give you any numbers.
Because we again, we don't provide that guidance to.
To be fair.
Last year's Q4 wasn't as good so it would be an easier comp.
Speaking from your perspective.
But.
Look our goal here is.
We have many parts of our business home Entertainment has struggled.
The video service provider business has come down.
<unk> electronics business is fine, but it goes through temporary changes.
It just so happens that early this year when we've seen a downturn from the video service provider. We've also seen one of the probably every five years or eight years declines in TV sales.
Due to economic difficulties in retail issues that some of our customers are experiencing.
So that part of our business has been tough we of course have a different opinion on each part.
But.
The smart home area, we as we outlined we've got a lot of new customers. There. We've got a lot of design wins, they take a little longer.
Some of them will come out this year, but we will have lower volumes when they start.
We're really trying to build for a better future at <unk> at this point, if we could do something to have a huge amount of sales next quarter, we'd of course do it.
But I think that building this back.
In these new areas it takes a little bit of time.
But we're looking towards a better 2024 based on the wins, we're getting right now.
And we've gotten over the last six months.
And the sales pipeline is pretty full right now.
In terms of the number of projects that we have to architect design architect engineer and then build.
Got a lot of work to do to get that done, but that's the good news that these projects have been won we now have to either develop them or in some cases wait for the customer to ship the companion product.
Most of our business as you know is a companion product we sell a controller for a another product that has to be built we're not always the long pole in the tent, sometimes our products can be done in six months, but the companion product takes a year. So we have to wait a year before we can sell that companion product.
So it doesn't matter either way.
Development lead times on some of these are longer.
We will start to see as we outlined in the in the prepared remarks some of that volume will begin later this year.
But some of these projects won't launch until Q1 of next year or Q2.
But we're winning them and we really feel very strongly about the potential in that part of the business. There's a few billion dollars worth of market out there and.
And we're just getting started and we're aligned and HVAC with one third almost one third.
Of companies that are building almost one third of that market today.
So we've done the first step which is to align ourselves with the leaders.
We've won projects with them now we're going to go in and perform on those projects and win more.
Great. Thank you.
Thank you so much.
Please give us a moment, while we standby and compile the Q&A roster.
And as again as a reminder to ask a question you will need to go ahead and press Star one one on your telephone.
Star one one on your telephone.
Our next question comes from the line of Gregory Burns of Sidoti. Your line is now open.
I just wanted to follow up on some of that pipeline commentary.
You just made Paul.
Can you just give us an idea of some of these.
More recent project wins or.
Program wins like what what types of applications those are for not necessarily specific customer details or anything, but just an idea of.
Kind of what.
Applications, you're you're winning.
Sure Yeah.
The ones I, Ken mentioned I will.
Of course, we mentioned daikon carrier.
We also mentioned, we called <unk>, Mitsubishi Electric train, which is a joint venture here in the U S.
And.
As far as the products and technologies, we're selling here theyre typically.
Smart.
Climate control.
Devices.
So we have we also have wins on products that those out there who have been to CES have seen tight tight dial in tight touch we have some standardized products that we've done this in home entertainment as well, we built standardized products and then customers can either take them is that standard product or.
Modify them.
Slightly the design of them.
But the.
The inherent value in them is the technology behind them.
So these are the types of products.
Clearly in HVAC that we're winning.
And therefore in many cases a full <unk>.
Smart thermostat.
Okay.
Have there been any more incremental wins in the of the Hunter Douglas.
David.
Flavor.
More home automation.
There are no new customers I can name right now, but even if the names. We mentioned we've added the number of two the number of projects that those customers have awarded us.
Because again as our strategy is we win a product or a project or two.
But then we are in at that customer.
And if the customer is happy with the performance, they're getting they will give us opportunities for other products and in some cases, we pitch products that they may not have considered before and they will consider us for that and we have been winning projects with in that market as well.
There is no new names I can mentioned yet but.
As I said the pipeline has gotten pretty.
Pretty active right now for these projects and pies as we call them.
That we're working on.
So and again it gives us.
A lot of real positive thoughts about both later this year because they'll start to fold in some of them, but really for next year.
Okay, and then just just just to understand the timing with some of the that you've announced already like a hunter Douglas.
Are you are you shipping for those customers yet are still like kind of a second half.
Well, we have a couple of projects with these customers yes.
We had one that I can't mention that was delayed but it wasn't delayed due to us they had approval processes, sometimes customers have to go through an approval process that can take months.
So a few forecasted it in a specific quarter it slipped to the next.
But our view on that is longer term its not its not good when that happens obviously, but.
The long term, it's not as relevant right, if youre performing well on our product and the customer continues to give you a new skus, that's what really matters.
Okay, and then lastly.
<unk>.
I know your size, it's kind of a total market. A few you mentioned a few billion, but specifically for the HVAC market.
How do you size the opportunity there and can it be.
As big as like the legacy home Entertainment business.
Over time or a fraction of the size like how should we think about that HVAC opportunity specific well HVAC alone is probably.
Almost as large now.
Now, we're not considering our served market to be.
Just like we did in the in home entertainment by the way.
Places like China, because the HVAC systems, there are often run with lower level controllers.
There is not as good a margin opportunity there.
So we did the same in home entertainment by the way, we do not have.
Really any exposure to the Chinese market for subscription broadcasting.
Because it's just it's different economics.
So similarly in HVAC, we do not consider that part of our near term served market.
So when you look at global estimates of HVAC volume, they might be higher than I'm about to state.
I am excluding that from our market estimates.
That market today is over $1 billion home entertainment total between consumer electronics and video service provider is over $1 billion, it's probably in the mid $1 billion range.
And the HVAC market is growing faster and has a growth rate of high single digits, maybe even close to double digit.
It's a growth market and Theres a lot of action there because the controllers are becoming much more sophisticated.
And because they're making them smart as most people out there are very aware of but in addition, they want to become a more important part of the smart home architecture.
And Theres a lot of things that you can do with these products that you werent able to do before they are not just about temperature management, they could be part of a home automation system.
Right yes.
Yes, Mark product would know what the temperature is outside it would know the desired temperature inside and it may be even able to no presence of humans.
Presence of humans could mean different temperature control mechanisms our algorithms.
Addition, that may control shades, because it's a hot day and Youre not home, maybe you'd like to shape to be shut to keep your house cooler.
You may want to open when you're home, there's any number of automation scenarios that you can.
Envision.
And these companies HVAC companies want to become a more integral part of that smart home.
So they see us as a good entry there because we're connected to most of these protocols in home and in fact, most of the products that are in the home or already have our control mechanisms inside of them televisions sensors et cetera.
So we are experts.
And we're considered this even by the home entertainment companies, particularly the consumer electronics companies.
We're embedding this into televisions today with LG, So we have real device knowledge.
Within the home we can discover.
Figure and control them.
And the HVAC companies are extremely interested in becoming more relevant.
Center of that Smart home experience. So I think it's a real good selling feature it's probably the reason why we have so many of the top players interested in working with us.
Giving us projects in that area and we think we can grow it from there and.
And again, it's strangely reminiscent to where we were in home entertainment some years ago, where our share wasn't as high and we declared that it would be higher and some who didn't believe us.
We're wrong right, we kept growing because we really have the capability.
Alright.
Perfect. Thanks.
Thank you so much.
Okay.
Please standby, while we compile the Q&A roster.
Alright at this time I would like to turn it back to Christian for closing remarks.
Well that'll do me I'll do that I'm Paul Harley.
Thank you for joining us today and for your continued support of Universal Electronics, We plan to reference we plan to present at the B Riley annual Investor Conference later this month.
I hope to see some of you there.
If you have any questions don't hesitate to reach out to us have a great day.
Yes.
Okay.
Thank you for participating in today's conference. This concludes the program you may now disconnect.
Yeah.
Okay.
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