U.S. Physical Therapy Inc. Q1 2023 Earnings Call
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Hum.
Good day, and thank you for standing by well going to the U S. Physical therapy first quarter 2023 earnings conference call. At this time all participants are in a listen only mode. After the speaker's presentation, there will be a question and answer session.
To ask a question during this session. Please first to starkey whereby the number one on your telephone keypad. Please be advised that today's conference is being recorded if you require any further assistance. Please press star zero I would now like to turn the call over to Chris Reading.
I didn't see you. Please go ahead sir.
Thank you very much good morning, and welcome everyone to our U S. Physical therapy first quarter 2023 earnings call. Joining me on our call. This morning from our executive team that Carey Hendrickson our CFO .
Thanks, Dean our executive Vice President General Counsel, Eric Williams, and Graham Reeve our Clo's.
Our team has the senior vice President and financing controller.
Before I make some opening remarks I'll stick to cover a brief disclosure statement a.
If you would please.
Thank you Chris.
This presentation contains forward looking statements, which involve certain risks and uncertainties.
These forward looking statements are based on the company's current views and assumptions.
Actual results may vary materially from those anticipated.
Please see the company's filings with the Securities and Exchange Commission for more information.
Thanks Jake.
I'm going to make some brief high level comments. This morning on various aspects of the business and then I'm going to turn it over to Kerry to cover the numbers. He does a great job with that.
I want to start out by just thanking our team.
Middle of last year really probably beginning in late may into June .
It seemed like the world changed having come through a couple of years of the pandemic and working our way through that well.
You know, we we got hit in the head with massive inflation affected everybody boy.
Scarcity largely affected everybody.
A tough year.
Thank our team for keeping their heads down working away through it I'm being very positive or partners are.
Our staff our leadership team our marketing support group everybody has just done a phenomenal job and I really think that that showed up quite well this first quarter.
Volume has been excellent it's been.
But as strong as it's ever been and interestingly this time first quarter in 2022.
At that point was our best ever first quarter visits per clinic per day quarter.
In the history of the company.
And we blew last year's first quarter away. So our partners are staff care that theyre, giving the patient marketing folks all.
All of the support that is helping us drive.
Strongest volume ever in the history of the company. It's it's just.
Just exceptional right now.
Areas.
Definitely I think ultimately impact these cost numbers as well.
On the right side of renegotiation continues to progress.
Team.
It's doing a very good job this is kind of.
A process that takes some time working our way through a very very large portfolio of contract, but we're getting some good.
And while it might not seem you know.
It hasn't been impacted particularly when you look at this first quarter number you have to remember that you know weren't another year, where we're in the middle of a Medicare cut a couple of percent.
We've had the sequester relief phase out.
Which is which was done you know last year. So that's another 2% this quarter.
All things have been equal when you look at our rate this quarter really up 2%.
Against the backdrop and so again, we're making progress we're not hum more work more work to happen there.
So.
We've had.
You know mid teens upper teens revenue growth before but considering the market that we're in right now considering some of the macro influences to come away with nearly 16% revenue growth in P. T.
Along with double digit operating income improvement and the highest ever Q1 EBITDA.
Really pleased with that right now and that's been a tremendous amount of work to get a Saturn more work more opportunity actually to happen.
Some of that revenue growth has come from our most mature facilities. In fact, our same store this quarter again benchmarking against probably the best first quarter, we've ever had a year ago. Our same store numbers were up 6%, which was really strong number for us.
So when you combine that with a really good acquisitions that we've done we've done some phenomenal acquisitions with great people like us to see some of them last Friday, when they were going for masters.
But whether they were here last week or are still in the field just working really hard to.
To expand it to grow and to make a difference I've been really really pleased.
With the people I'm really pleased with the progress and the effort.
So we talked a little bit.
Spoke a little bit last call about us I'm no longer gonna accept low margin.
Managed care payers are making to take care of Medicare patients under their advantage plans.
You know somewhere within the industry I would just encourage you to continue to evaluate your contracts.
We do as a profession phenomenal job for our patients we should be the musculoskeletal gatekeepers.
And we shouldn't be paid accordingly in order to do and produce the kind of care and results, but the cost levels frankly that we produce and so.
Even through the quarter on the other side of this first quarter volume continues to be very very strong so I'm, hoping and expecting we can keep that going we've made progress on our front desk automation rollout.
It's nicely underway, we'll be rolling out and expanding as the year goes on it's going to take a little time do that.
But we think that that is also going to help with our employee retention at the front desk, which has improved also dramatically in fact, our turnover.
For clinical positions license clinical positions. This is Lee.
Low as I can remember in many many years, it's gone down a lot.
And while our front desk and all related hourly turnover is not at that level, yet it's improved considerably from where it was last year.
Now, let's shift gears for a second and talk about our injury prevention business.
You know that business has been incredibly strong and incredibly resilient.
We've added to it over the period with a number of handful really a really nice acquisition that business continues to be a very important part of our company. It gives us some diversification and it makes a difference to these customers.
We're going to slow a little bit this year I think just as I look out west.
We're seeing some some particularly in the tech sector Ceos and Cfos.
Some of these large companies.
Be concerned about whether the economy is going to have a harder soft landing.
Some of those are pressing pause on contracts or or pending.
The rollout of the startup contracts getting new business some of our business incredibly resilient with with a number of our customers and not just resilient, but continuing to expand and that'll happen regardless of what happens with this economy as we look forward. This year, we're going to have some way.
And losses, and that's going to level out a little bit more than we've seen in the past and that's already built in that's you know Cary will cover the first quarter numbers. That's that's kind of where I expect this year's going to look like I think we will achieve our budget for the year, but we will be a little lighter on the growth side than we have.
Ben unless we could get a deal done.
So I'm going to kick it over to carry this feels like a really good start to the year again I want to thank my team. We're excited about it we have some great things. We're working on that we're not going to talk about yet today, but will be a little bit later in the year that I think would be meaningful for our company and so with that Carrie I'd ask you to do.
Go ahead and cover the results in more detail.
Great. Thank you, Chris and good morning, everyone.
Chris's remarks reflected we had an outstanding first quarter by most any measure.
Had record high volumes, we had strong growth in revenue, we had a continuing downward trend in our salaries and in our total operating costs on a per visit basis, we had growth in our physical therapy operating income and in our operating income margin.
And year over year growth in our total company adjusted EBITDA. So.
Really good start to the year, we reported adjusted EBITDA for the first quarter of $18 $5 million, which was an increase of $1 million over the $17 $5 million that we reported in the first quarter of 'twenty to our operating results, which includes the impact of the higher interest expense was 59 per share in the first quarter of 'twenty three are.
Total company revenues increased 12, 8% in the first quarter growing from $131 7 million last year to $148 $5 million in the first quarter of this year and our total company operating income increased $2 million from $15 million in the first quarter of 'twenty $2 million to $17 million in the first quarter of <unk>.
Three.
Our average visits per clinic per day in the first quarter was 29 eight that is the highest first quarter volume in the company's history and it's the second highest volume for any quarter bested only by the second quarter of 2021.
Our average visits per clinic per day was 30.0 and each month in this first quarter was a record high for that respective month. Our average visits per clinic per day was $28 nine in January it was $29 eight in February and then 37 in March and that $30 seven and March was the highest volume for any month in.
The company's history.
Our net rate that Chris referred to was $103 12, which was an increase of 12% over the first quarter of last year. Despite differences in Medicare rates year over year, we had a 2% Medicare rate reduction that was put in place at the beginning of this year and then in the first quarter of last year, we still had 2% sequestration relief on Medicare.
Rates, which was phased out as the year went along last year. The Medicare rate differences were more than offset by a three 2% increase in our commercial rates versus the first quarter of last year.
As Chris noted, we still have a lot of work to do here, but we expect to continue making progress in increasing our commercial rates and we're continuing with our plan to renegotiate or terminate contracts that reimburses at a rate that's less than what it cost us to serve our patients which is primarily related to a subset of our Medicare advantage contracts and we expect the impact of that work.
The.
This reduction of the Medicare advantage contracts that are at low rates to begin showing up in the second half of 'twenty three.
Our physical therapy revenues, they were $127 4 million in the first quarter of 'twenty three that's an increase of $17 million or 15, 6% from the first quarter of 'twenty two.
The revenue increase as Chris noted at our same store clinics, which was five 8% driven by an excellent 6% increase in our visits versus the prior year.
Physical therapy operating costs were $106 million, which was an increase of 13, 9% over the first quarter of last year. We're very pleased to see our physical therapy operating cost per visit decrease versus the first quarter of last year declining from $83 nine per visit in the first quarter of 'twenty two to $81 97 per.
Per visit in the first quarter of 'twenty three our physical therapy operating cost per visit peaked in the third quarter of 2022 and they've come down each quarter. Since then our total operating costs were $85 14 in the third quarter 'twenty two.
Decreased to $84 five since the first quarter of 2004th quarter of 'twenty two excuse me and then they declined further to $81 97 in the first quarter of this year.
Our salaries and related cost per visit were up just 0.7% in the first quarter of this year versus last year and they've also continued to trend down since the third quarter of 2022.
From $60 99 in the third quarter down to $60 <unk> in the fourth quarter of 'twenty, two and then down further to $59 14 per visit in the first quarter of this year.
The increase in physical therapy volumes and revenue coupled with a stabilizing expenses resulted in improvement in our physical therapy margin as well improving to 21.0% in the first quarter of 2003 compared to 20.0% in the first quarter 'twenty two.
Yeah.
Chris provided color on our industrial injury prevention business in his remarks, our revenues for that business were $19 $4 million in the first quarter up $300000 in the first quarter of 2022, our expenses in that business were $15 $6 million, which is an increase of $700000, resulting in industrial injury operating income.
A $3 $8 million and a margin in that business was 19, 5% in the first quarter 'twenty three as compared to 21, 8% in the first quarter of 'twenty two.
Our interest expense was $2 $6 million in the first quarter of 'twenty, three which was an increase of $2 million over the first quarter of last year. The higher interest expenses due to an increase in our debt related to acquisitions closed during and since the first quarter of last year, and then of course higher interest rates in the first quarter of this year than they were last year.
Our balance sheet remains in an excellent position.
We had a $150 million term loan with a five year swap agreement in place that fixes. The one month term so for rate on that $150 million at $2 81, 5%.
<unk> the applicable margin based on our leverage ratio the all in rate on our $150 million of debt was $4 91, 5% in the first quarter, a very favorable rate in today's market and below the current fed funds rate.
In the first quarter of 'twenty three the swap agreement saved a $700000 in interest expense.
At March 31, our swap agreement had a mark to market value of $3 $6 million, meaning that the current expectation is that we will pay $3 $6 million less in interest expense of the remaining approximate four years. Some of our swap agreement then we would've paid without the swap.
In addition, the term loan we also have a $175 million revolving credit facility and that had $38 million drawn on it at March 31, and we had cash on our balance sheet of $32 6 million at March 31.
Borrowings on the revolver that $38 million, that's at a variable rate the weighted average variable interest rate on our debt and the on that facility in the first quarter was approximately six 8% and that put our total overall effective interest rate for the first quarter at five 5%, including the term loan.
The strength of our results in the first quarter and the continuing strong volumes. We're seeing in April gives us continued confidence in the adjusted EBITDA guidance range. We provided at the beginning of the year of $75 million to $80 million that guidance excludes the impact of potential acquisitions and the remainder of the year.
In closing we've had a very solid start to 2023, and we will continue to work hard to produce the best results possible for all of our stakeholders. This year.
And with that Chris I'll turn the call back to you.
Yeah.
Hello, Chris.
I'm, sorry, I'm, sorry, I was.
Muted.
Ill go ahead and open go ahead and open the line for questions.
Certainly at this time, if you would like to ask a question. Please press star one on your Touchtone phone.
All your question at any time by pressing the Pouchy.
Once again Thats Star one we will take our first question from Larry Solow with CJS. Please go ahead.
Good morning, Larry Good morning, Good morning, guys have that problem with the Newport and some I'm sure.
Yes.
So really really good start to the year.
Obviously I think weather.
Or lack of of bad.
Bad weather across most of the country I know some parts had some bad weather, but probably certainly helped you guys was that was a good guy for you but again.
6% same store volume growth is really really remarkable coming off of a great comp too so.
Just looking at I know you don't guide quarterly, but we're kind of in the heart of the good part of the year right and you did almost 31.
Per day per clinic.
Any reason to think that wouldn't continue at least.
Assuming weather remains.
Barely.
On your side.
Yeah.
I'm not going to.
I'll say this.
Volume continues to be very strong.
I'm not going to I'm, not going to go out and predict which certainly shouldnt have major weather events, certainly not worrying to weather events going forward.
And.
I am hopeful that we can we can continue to grow as we have most every year since I've been here with the exception of the <unk>.
Second half of last year and so.
We're certainly going to work to do that we'll have to see how it shakes out but.
Like where we sit right now.
And do you think labor, obviously labor still are still higher price of course, but it feels like your access to and availability is a lot better.
Has that did that help.
You're leaving some revenue on the table.
Unable to.
Kind of as many patients per day, just because of.
Labor issues that are that have gotten better is that part of the year over year improvement do you think.
Yes, sure absolutely now I will I will say this first quarter of last year, we weren't feeling the labor issues that we began to fill them late in the second quarter and certainly into the third and fourth quarter and so I think you know that.
Quarterly comparison.
Labor was not as much of an issue a year ago.
So say that right now our time to fill open positions has decreased dramatically from where it was in the second half of last year.
Proves a lot I think it will continue to improve that's my sense.
That's both for critical positions as well as front best position and I have to believe.
Now that some of the 20000 people who left the profession. So at some point.
And the pandemic or during the pandemic a lot of those folks I think.
Early on I thought they all wouldn't stay out forever I think a lot of those folks will come back.
And yes, certainly I think that will help us this year progresses.
On a comparative basis.
Got it and just last question one follow up just on the the total clinic. It looks like I think the groups have been sequentially and then I think there's only one acquisition of the one larger clinic right. So it looks like six net new clinics, if I'm not mistaken. So that's pretty good de novo activity at least to start the year. If my math is right.
Yeah. We've got you have de Novo activity, we've got across a swath of great partnerships.
We've got more acquired activity, which is coming.
It should be another very good year at least that's what we're working to produce in <unk>.
Expect that that will happen you know both hungry.
We lap this year so.
Development right now we feel confident that we can deliver a good year, both de novo as well as acquired.
Excellent. Thanks, Chris I appreciate all the color.
Yes, Thanks, Laura Thanks, Larry.
And we will take our next question from Brian <unk> with Jefferies. Please go ahead.
Hey, good morning, guys congratulation.
Thank you good morning, I guess, Chris I'll start with obviously strong quarter here.
<unk> started the year, it's really nice to see that.
You think youre gaining market share as the whole industry is seeing kind of a recovery and an uptick in demand for physical therapy services right now.
Yes.
Yes.
I mean, yes, I think select reports Tonight after the market closes I think API reports next week.
See how they do.
You don't have a lot of friends, who are who are Ceos of these other companies, but we tend not to put each other in a position where we're sharing.
Detail of inside baseball.
Look I think last year was a tough year.
And last year was one of the first year. So we didn't grow our visits per clinic per day. It was a little bit more muted more more flattish and so I think we're staffing improving.
We're seeing some pick up whether removing that from competitors or not I got to believe that in some cases, we are look.
When we do acquisitions.
And we bring on really good companies to begin with.
One of the reasons that people come with us it's because of the resources that we could provide some of those resources are directionally.
Enabling these companies to grow at a faster rate than they would have otherwise.
So I think thats coming from market share.
I don't have a good way to measure to be absolutely precise and so it's just like us.
Gotcha, and then yes, Gary as we think about rates just curious you talked in your prepared remarks about how you're going.
Going to walk away from some of these underpaying contracts.
You've already been vocal in public about it since the last quarter or so so just curious what those conversations are like or what the feedback or reception has been from those payors.
We're having those conversations.
Yes, I'd say it's mixed.
In some cases, they are willing to come back and renegotiate rates with us and sometimes we're not and that's fine with us and where we're going to move forward. It's not good business for us and as Chris noted, we're just not going to we're not going to take that any longer so.
We're fine with walking away from it we have they don't represent that much volume for us and it's volume that we can easily replace especially with the strong volumes were having.
This year, so we feel good about it.
Got it and look at and then maybe in a tight labor market no I'm sorry.
In a tight labor market.
It's still a little tight it's getting better but it's you know it's not.
Easy.
But you can't you just can't afford to be looking at.
Hiring staff to take business, where you don't have a margin profile.
So when we talk about market share movement, we're going to move that market share to our competitors, we're gonna let them take it.
60 cents on the dollar.
There's going to be no margin there and so we're going to we're going to replace that with much better margin business and so.
Whether they come back or not they have in some cases they have it in all the cases.
With that right now.
Yeah, No. That's actually my next question, Chris was related to that I mean, you called out in your prepared remarks, how you've.
Turn it over I think clinical initial level is at its lowest and so just curious I mean, I know you're very in touch with a lot of folks in the industry and we're hearing turnover rates that are higher notably higher than yours.
Some of your competitors. So just curious what are you hearing from your own clinicians maybe you do survey work.
It allows you to maintain this industry low turnover rate for clinicians.
Look I.
Again, I cant say, absolutely with precision, but I definitely feel like it has to do with a partner model. It has to do with what they hear from leadership in terms of our values and what's important.
Think that resonates with people.
It helps people be stickier in terms of.
Understanding the big picture I think when we have challenges.
Go about those challenges in a certain way will not be people up.
No we're not slamming sits on the table.
It's not a threatening environment, it's a supportive environment I think all of that ultimately filters through.
And I have to believe some of it is the fact that.
When you look throughout the organization from a leadership perspective, whether it's a regional presence.
Our Ceos.
Or even maybe to a lesser extent me, having long term industry experience not just coming.
From.
Hum.
Another another business segment or working with the private equity group.
You know flip the business.
And another.
Another totally different kind of an area I think it resonates with people that we're about this from a care perspective first and foremost.
And you know I think I have a good team and they do a good job carrying those messages and boarding those those things that are important and I think ultimately it makes a difference I hope I hope that's what it is.
Awesome Alright, thanks, guys Congrats again.
Thanks, Brian .
Okay.
And once again as a reminder to ask a question Thats Star One we will take our next question from Matt Larew with William Blair. Please go ahead.
Hi, This is Madeline Goldman on for Scott.
Hey, Matt.
Hi, guys.
Right.
Trying to think about how do you expect the net rate could change throughout the year, especially I like sequestration impact rolls off in the second half of the year I think in the past you said you expect it to be kind of roughly flat with the fourth quarter and wanted to see if you were still thinking that way.
I think for the full year model, and that's where we would still expect to be.
You know well will grow from where we would expect the rate to move up from here for sure I mean, we feel really good about the fact that our net rate was up over the first quarter of the prior year, despite that 4% cumulative Medicare rate differential year over year. So that's good our commercial rates were.
We're up over last year by three 2% in the first quarter first quarter to first quarter. They were relatively flat from the fourth quarter to the first quarter, but well you know there are always a little lighter in the first quarter of the year and then we'll grow from here. So I think we're still in good shape on it right from a rate standpoint, but we've got a lot of work to do as we mentioned I mean.
This is not easy work doing these rate negotiations and pushing for increases and you'll you'll push for them youll get them, but it'll take a little while for them to come into effect. So you know what.
We're on a good trajectory I think Maryland.
Great. Thank you and then I think you mentioned last quarter that Youre in group purchasing order was rolling out in February for your pilot any insights from the pilot or takeaways that you can apply as you roll it out more broadly.
Yeah, Graham do you want.
Yes, so we've got a we've got an active right now in about 200 locations and it's really too early yet to give you any analytics feedback on it that would probably be more at the end of this quarter to the end of third quarter, but what we're rolling it out in a systemic fashion and we're going to continue to do that.
Great. Thank you.
Sure.
Thank you Alan.
And once again Thats star one for your questions.
And it does appear that we have.
Apologize, we do have a question from Mike <unk> with Barrington Research. Please go ahead.
Hey, Mike Hey, Good morning, Mike Good morning, and I had press star one three times.
And there are about the hang up anyway, but I got it okay.
Now that I've learned to operate a phone let me ask a couple of questions for me.
You both so both of those.
That's right that's right I mean, I'm, a very good company alright, so right in that renegotiations.
Chris You know I'm, a baseball fan I mean in terms of just the nine inning baseball game, how far along are you guys in terms of what you're trying to accomplish there.
Okay.
We're early in the second.
Yeah, that's right yeah.
It's we're a little farther along than we were.
Nine months ago. So it can't continue to say first thing, but you know.
I think we've got a lot of baseball left to go.
So I mean, considering considering you you you sort of called out of 3%.
Comparison in your commercial rates I mean, that's that's that's great, but there's still that much yet.
<unk> left to go get after.
Well, we have a lot of contracts, we have a lot of partnerships or individual or cross of 40 states now or so.
It's.
It's a lot to get through and well and we are still early so that's.
That's the reality.
But it just means that we're going to be at this for a longer period of time and it just it should have an effect for for a while.
So I wanted to ask on the the revenue that you guys are sort of willing to walk you know I know you don't want to but you're willing to walk away from on certain contracts and maybe some other contracts as well.
I mean.
Gary I think you may have alluded to hey, it'll start to impact second half I mean is there any way to sort of think about magnitude I mean, we're talking a few million dollars. We are talking more than that I mean, what what.
Just from a modeling perspective, I don't want to.
Not sort of take that into account and is there anything you can say to help on that.
I mean, they're not big dollars.
But.
There is I mean, it's I would say several million dollars something like that and in revenue.
But on every one of those dollars.
The margin is zero to slightly negative right and so.
I'm, absolutely willing to walk away from that and we as Chris has noted and we've talked about we're going to be able to replace that volume with <unk>.
Better paying volume and that'll make a difference so so.
But that's all kind of baked into if you will into our into our guidance and kind of our expectations for the year.
It takes a little while for the termination notice as once you provide the termination notice for it to take effect I, usually about 90 days and so that's why I said, we will probably see more impact from that in the second half of the year because we've done that in the first quarter. It will mostly be effect in effect by kind of June July where we're where we're no longer taking that business.
And I know why you didn't want to predict blue Sky stuff.
For the foreseeable future, but just in terms of weight.
Set about April .
Would you be willing to share did did volume did a ah patient visits. They are you know above 30 year near 30 are if you have that data.
Yes, we I mean, we've seen.
Do weekly visit reports in that and it's been I'd.
I'd say, Chris pretty similar to what we saw in March.
Above 30.
Okay.
Fantastic outstanding.
And then I guess just.
In terms of.
Your commentary around the injury prevention business person that does the sort of the state of things make it less likely that Ah.
As might engage in any kind of M&A.
M&A in that area or or or does it make it more likely maybe there's some opportunities that open up can you can you just speak to that.
Yeah, I don't know that I can hand, it certainly doesn't make us less likely we love. This business, we love the teams we love what it does understand that over the six years that we've had it.
We've added programs and products and services in a pretty considerable way some of those are cyclical some of those are counter cyclical. So right now for instance, in the last year or even our testing business, which the year that we bought the testing business, which I want to say it was.
2019, you we bought that business testing was slow everybody was kind of nervous I might just ask everybody to hang on.
There was going to be some cyclicality with this.
Since then last year I Miss your testing has been on fire our injury prevention business by virtue of some expansion that we've had among existing clients. It's been really strong, but there are parts that have been affected.
We've got to make some adjustment for.
One of those is office ergonomics and it's lost on nobody that you know the offices right now many are not full anymore at least not on a five day, a week basis, and so we're making some adjustments to be able to do more things remotely and in People's homes.
Just that business a little bit.
Nobody can control.
No.
When I say, nobody I mean us we can't control what the fed does and we can't control whether this ends up being a player.
Playing that lands software you are a little bit of a harder landing in terms of the economy.
And so Ceos and cfos, they're they're trying to judge for themselves what that looks like in the coming period. So.
Hum.
People are kind of waiting to see before they make investments in some cases.
Newer customers.
Existing customers business has been pretty strong. So we continue to look for we're having discussions with them.
<unk> in this space, we like it just as much as we ever have but just trying to guide you toward our expectation for this short term period, which we think will be a little bit more tepid than it has been it's it's it's literally since the time, we require that kind of been on fire.
It's grown at a really really fast pace.
This year will slow a little bit it doesn't mean, it's bad business and I think we'll get to pick back up again, but for right now it's going to be a little slower.
Can I just ask real quick on the agreements that you have in place in that business are they are they annual.
Renewals or how does that work.
Yes, they're mostly annual renewals, but look the reality is when things happen.
The company that you've had a good relationship with ash you to pause.
If you're a great example of this.
Beginning of the pandemic, we were to roll out.
Big contract with Uber.
And we all know that Uber kind of disappear that first year and the pandemic nobody was nobody was out ride sharing or and so.
Okay.
We pause that we had a contract but it doesn't it doesn't makes sense to force the customer into something that they don't want.
So.
So theres definitely a balance there these are longer term contracts, usually and you know.
But when there are major points of inflection we tend to defer to the customer and make adjustments accordingly.
It keeps it keeps business around for a long time know that Uber story, which got paused beginning of 'twenty one.
Massive for us in 'twenty, one 'twenty two.
And so again, we're trying to do the right thing and trying to be good stewards.
So we have to make adjustments when the customer wants to make adjustments may not have to book we do.
That story is a perfect example of why you guys have been as successful as you have in the last 20 years great job. Thank you.
Thanks, Mike.
Yeah.
And there are no further questions at this time I will turn the call back over to the speakers for closing remarks.
Okay. Thank you very much thanks, everybody for your time today.
Appreciate all the questions sorry for my early far more on the on the phone we look forward to talking with you I know you have some post call follow up with some of you do you have any questions just give carrier not a shop and we'll be happy to tackle those offline. Thanks and have a great day.
Thank you and this does conclude today's program. Thank you for your participation you may disconnect at any time.
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