Q2 2023 Retail Opportunity Investments Corp Earnings Call
Okay.
Welcome to the retail opportunity investments second quarter 'twenty to 'twenty three conference call participants are currently in a listen only mode.
During the Companys prepared remarks, the call will be open for questions now like introduce Lawrence Avera, the Companys Chief Accounting officer.
Thank you before we begin please note that certain matters, which we will discuss on today's call are forward looking statements within the meaning of federal securities laws.
These forward looking statements involve risks and other factors, which can cause actual results to differ significantly from future results that are expressed or implied by such forward looking statements.
Participants should refer to the company's filings with the SEC, including our most recent annual report on Form 10-K to learn more about these risks and other factors. In addition, we will be discussing certain non-GAAP financial results on today's call reconciliations of these non-GAAP financial results to GAAP results can be found in the.
Company's quarterly supplemental which is posted on our website now I'll turn the call over to Stuart <unk>, The company's Chief Executive Officer Stuart. Thank you Lauren and good day everyone.
Here with Lauren and me today is Michael Haines, our Chief Financial Officer, and Rick <unk>, Our Chief operating officer.
We are pleased to report that our grocery anchored portfolio continues to perform well.
For space continues to be strong coming from our growing broad range of necessity service and destination tenants.
All of which continue to seek out our grocery anchored shopping centers.
Capitalizing on the demand and building on our record leasing activity in the first quarter during the second quarter, we again posted a record amount of leasing and <unk>.
Back in just the first six months alone we've already leased approximately 1 million square feet of space, which is a new record for the company.
For reference at the start of the year, we had 859000 square feet scheduled to mature during all of 2023.
The fact that we've already surpassed that amount at mid year speaks to the success of our length longstanding hands on approach and the fundamental appeal of our grocery anchored shopping centers.
Additionally, not only are we capitalizing on the demand for leased a record amount of space. We are also capitalizing on the demand to drive rents higher into enhance the tenant mix at each of our centers.
Importantly, our overwriting objective is to continue enhancing the long term competitive position of our portfolio and the long term strength and stability of our portfolio is income stream and bottom line cash flow.
With respect to dispositions. We are currently on track to close in the third quarter. The property sale that we discussed on our last call. We were also currently planning to bring to market for sale in the second half of 2023 or two infill undeveloped land parcels in the San Francisco Bay area that are slated for multifamily.
<unk>.
Altogether, we expect that the three dispositions could generate between 30 and $40 million of proceeds in total.
In terms of acquisitions during the first half of 2023.
Broader market on the West coast was relatively quiet.
The market digested the impact from the increase in interest rates over the past year and the recent banking turmoil.
For the few transactions that did close involving sought after stable grocery anchored properties pricing was in the high fives low 6% range driven in part by being all cash no leverage transactions typically with buyers that are types of institutional investors focused on long term stability.
We're starting to see signs of the market potentially picking back up as there has been a bit of an increase here recently and the number of properties being brought to market, which will hopefully bring greater clarity in terms of pricing chefs.
As it relates to off market opportunities, we continue to be proactively engaged in seeking out transactions.
We currently have several interesting opportunities in the pipeline that we believe have significant long term embedded growth. However, we're not there yet with the private owners in terms of initial yield pricing. So it's a bit too early to discuss specifics.
Additionally, we continue to get a number of inquiries regarding potential O P unit transactions, which we are exploring as well.
Now I'll turn the call over to Michael Haines to take you through our financial results Mike. Thanks.
Thanks, Eric for the three months ended June 32023, the company had $82 million in total revenues and $28 million in operating income.
For the first six months of 2023, the company had 161 million in total revenues and approximately $54 million in operating income.
Same center cash basis net operating income for the second quarter 2023 increased three 2% and increased one 3% for the first six months.
We continue to be on track to achieve same center NOI growth for the full year, that's within our guidance range.
GAAP net income attributable to common shareholders totaled $9 9 million for the second quarter of 2023, equating to eight cents per diluted share for the first six months of 2023 GAAP net income was $18 1 million or 14 cents per diluted share.
Funds from operations for the second quarter of 2023 totaled $35 6 million equating to <unk> 27 per diluted share for the first six months of 2023, <unk> totaled $69 4 million or <unk> 52 per diluted share.
Turning to our balance sheet as we reported on our last call. During the first half of 2023, we entered into swap agreements fixing the interest rate on $150 million of our $300 million term loan locking in the rate at five 4% through August of 2024.
With the countless swaps at June 30, approximately 85% of our debt outstanding was fixed rate. Additionally, today, 96% of our total debt is unsecured and 97% of our total GLA is unencumbered and in terms of net debt. We continue to focus on steadily lowering our ratio for the second quarter. The ratio was six five times with.
Respect to the $250 million of senior notes that mature in December our objective is to refinance the bonds through long term public bond offering potentially at $400 million offering. So also refinanced $150 million of our term loan.
However in light of current market conditions to be prudent. We're also evaluating several other refinancing strategies, including possibly a combination of medium long term public bonds, where possible via a private placement.
Also considering utilizing some secured debt along with disposition proceeds and possibly some equity market conditions permitting to further lower our net debt ratio down in connection with the refinancing.
Additionally, we're also considering utilizing pre payable shorter term unsecured debt.
It provides flexibility for when market conditions become more settled now I'll turn the call over to rich <unk>, our CFO to discuss property operations rich. Thanks, Mike as Stuart highlighted demand for space across our portfolio of strong coming from a broad range of both existing and prospective tenants leading the charge of destination tenants most noted.
I'm, leaving new health and wellness concepts that continue to expand on the west coast, along with new children enrichment centers and a continuation of new quick serve food concepts coming to market.
Additionally, traditional full service restaurants continue to open multiple standalone smaller format to go concepts capitalizing on their established brand and borrowing.
These to go concepts are borne out of necessity during the pandemic and since then have been steadily growing in popularity. So much so that they could become over time a mainstream in line tenant.
We're also seeing neighborhood destination service tenants that were among the hardest hit during the pandemic and had been slow to rebound now coming back strongly again seeking space in earnest across our portfolio.
These tenants typically have modest space requirements. They played an integral role as one of our core necessity and service based tenants that draw daily neighborhood consumers to our centers.
Additionally, they are flexible in terms of their space needs and configuration. So they are ideal for leasing that last bit of available space for.
Our perspective, we view these service tenants, becoming active again, specifically seeking out space at grocery anchored centers is an important positive trend.
Turning to our specific leasing results as Stuart highlighted we again posted a strong quarter in <unk>.
Terms of our overall portfolio lease rate during the second quarter, we maintained our high lease rate of 98, 3%.
Leading the way was our Portland portfolio were 16 out of our 18 shopping centers in the Portland market stood at a full 100% leased at June 30, with the remaining two properties both at 99% leased.
Portfolio wide, we also set a new record during the second quarter with 48 of our shopping centers being 100% leased.
Additionally, our anchor space continues to be 100% leased and as of June 30, our shop space stood at 96% leased.
With respect to our leasing activity during the second quarter, we leased 430000 square feet of space, which is a new second quarter record for the company.
Again, our second quarter leasing activity together with a record leasing volume in the first quarter for the first six months of 2023, we leased 989000 square feet of space in total again setting a new record.
And as Stuart highlighted already surpassing what was originally scheduled to mature during the entire year.
The bulk of our leasing activity continues to center around tenant renewals in fact during the second quarter, 79% of the square footage that we leased involved renewing valued tenants, which was split roughly equally between anchor and non anchor renewals.
In terms of anchor renewals during the second quarter, one of our longstanding national supermarket anchors approached us about wanting to not only extend the Liza bears that was maturing later this year, but also wanting to explore possibly extending all of their leases in our portfolio.
We capitalized on the opportunity and successfully extended their leases out for another eight year on average while also increasing the overall base rent.
Withstanding some other leases previously having flat renewal options.
And we were also successful removing property leasing restrictions.
In short the transaction enhances the long term stability of each of the centers and enhances our flexibility to maneuver and optimize the tenant mix going forward. Additionally.
Additionally, there were no ti required on our part.
With respect to our non anchor renewals during the second quarter, we renewed 78 valued in line tenants, achieving a 7% increase in cash base rent and again with essentially no ti as required on our part.
In terms of new leasing activity during the second quarter, we signed 45, new leases, including 44, new inline tenants achieving a 13% increase in same space base rent on average and we signed 118000 square foot anchor lease where we achieved a 127% increase in base rent.
The new anchor tenant there is an established national seasonal tenants that we signed on the short term in term basis.
Currently have a new long term lease lined up with a national destination tenant to take the space following the seasonal and term tenant.
And the new long term lease has an initial base around that also represents a substantial increase over the maturing lease.
Lastly, we continue to have good success in getting new tenants open and operating during.
During the second quarter, new tenants, representing $1 9 million of incremental base rent on a cash basis opened and commence paying rent.
Together with the new tenants that opened during the first quarter year to date, new tenants, representing $4 1 million of incremental Ram have open and commence paying rent.
In terms of new tenants that haven't yet opened including those that we signed during the second quarter as of June 30, the incremental amounts stood at $7 $2 million, the bulk of which we expect to commence as we move through the second half of the year.
Now I'll turn the call back over to Stuart.
Thanks Rich.
Based on our results year to date and what we see on the horizon for the second half of the year, we continue to be on track in terms of our <unk> guidance.
<unk> side any acquisition activity just based on our current leasing pipeline alone should put us squarely within our guidance range.
Underscoring the consistently strong property operations and leasing results quarter after quarter year. After year is our proactive approach of constantly working to enhance our portfolio and tenant base. Additionally.
Additionally, while parts of the commercial real estate industry are facing mounting issues in distinct contrast, the long term drivers of the grocery anchored shopping center sector are not only fundamentally sound today, but it is more and more diverse tenants and emerging concepts concepts steadily gravitate to grocery anchored.
Shopping centers, we believe the sector and our portfolio, specifically is well positioned to continue generating stable risk adjusted returns long into the future.
Lastly, we recently issued our fourth annual ESG report, which details our accomplishments over the past year.
We are continuing to make steady measurable progress at enhancing the long term stability.
Of our portfolio, along with continuing to implement longstanding employee advancement and community engagement programs now we will open up the call for your questions.
Operator.
Thank you, ladies and gentlemen, if you'd like to ask a question. Please press star one on your telephone again, if you'd like to ask a question. Please press star One line one moment for our first question.
Our first question comes from a lot of Craig Melman of Citi. Your line is open.
Thanks, Good morning Joseph.
Morning, Scott.
Joseph here with Craig.
Maybe just start on the transaction market obviously.
For you it sounds like it was quiet pretty broadly are you starting to see it.
At all I don't know if you could maybe touch on where you think bid ask spreads are and what we would need to see to start to see some deals actually get done.
Well I mean, a function obviously first of all supply and again the market continues to be very tight in terms of looking at new transactions that starting to pick up a bit as I said in my comments.
But the big at the bid ask spread.
<unk> continues to be.
Pretty far in terms of other types of properties that come to the market not grocery anchored.
And then the only other thing I could shed some light on Nick is that there was a transaction that is currently under escrow in San Diego.
That is traded in the low fives, that's been sort of the most recent comp, but the big gas spread has really continues to be y, but theres just not enough supply.
Thanks.
Touched on kind of the potential of public bonds in a private placement.
Where do you think you could issue today, just kind of where spreads and looks at all of that.
Costs there.
Hey, this is Mike.
New 10 year deal I would expect the pricing, we'd probably be in the mid to high 6% range and privates about that probably in that same general neighborhood, maybe a touch higher mid to high mid to mid to high 6% range.
Thanks, and then just finally, what drove the higher other income in the quarter.
So those are really anything unusual during the second quarter.
Other income for the first six months were pretty much on par with last year.
Thanks.
Thank you one moment please.
Our next question comes from the line of Todd Thomas of Keybanc. Your line is open.
Hi, John Good morning, Todd.
Hi, Good morning, I, just wanted to I guess stick with the transaction environment, a little bit and ask about the dispositions Stuart you talked about the two undeveloped land parcels, but I think Mike.
You mentioned exploring additional dispositions as a source of capital to repay debt or.
Refinance the December maturity.
And the balance of the term loan.
Is there anything on the disposition front being contemplated beyond the $30 $40 million discussed I know you have one or two larger format centers.
Including Fallbrook, which.
In the past you've sort of characterized as a little bit of a headache over time, it's one of the fewer box here assets in the portfolio.
Is that something that you'd contemplate selling.
In the current environment is larger format products have performed well a little bit more recently.
Yes, we really don't have.
The crossroads and topic, we really don't have what I would call our large format.
Our centers, but it really depends on whether or not the market activity picks up again in the second half.
Which we're starting to see signs of it but it's just too early at this point to know for certain.
You know at this point youre more likely sort of to see.
Potentially more dispositions, but it's again.
Going to be sort of the towards the fourth quarter of the year.
But yes, we are looking at bringing more to the market Todd as we get through the balance in the year, but again, it's all it's all relative to the transaction market and how accurate that gets.
Okay.
Regarding those two assets I guess, you've spoken a little bit more favorably about crossroads.
The value creation opportunity there.
Over time, but.
Either of those assets assets that you would potentially look to.
Two sell in as a source of capital in the future.
Well I mean outside of the two assets around the Bay area, which we are gearing up to put on the market.
We're thinking about different things regarding the multifamily at crossroads.
Right now the capital outlay for the balance of the year is not is not that much its very little left.
So we're still contemplating long term, what we do with the multifamily whether we joint venture it.
Or whether we build it ourselves or potentially selling it so thats still on the table, but we haven't made any decisions yet so we're still getting through the permitting process.
Okay.
Alright, and then just last question I guess.
You haven't had to discuss much around watch list tenants really over the years.
Now recently, just given the composition of your portfolio, but rite aid has been in the news recently they are your third largest tenant.
A little under 2% of ABR can you just discuss that space within the portfolio.
Do you feel rite aid rents are versus market, how you feel about back filling that space to the extent that you do get some back.
And maybe provide just a little bit of color around that that exposure in general.
Barry its rich yeah, as you've noted that rite aid only accounts for about one 7% of our total base rent which comes from <unk>.
<unk> 15 leases we have.
One number will drop to 14 with the.
The property, we currently have under contract.
And the majority of.
The writers we have are there newer prototypes.
We meet with Rite aid.
Ongoing basis, they are generating solid staff sales and the rents are below market and.
This big spread we had on the anchored leases coming from a variety of at least that we've replaced so we see a lot of upside in these leases.
Okay alright. Thanks.
Yes.
Thank you one moment please.
Our next question comes from the line of Lindsay Doi Kin of Bank of America. Your line is open.
Good morning, David.
Okay.
Good morning.
I wanted to ask about.
I know on the last call you all mentioned a one time expense that was incurred.
From a net seller in the amount of about 300000.
Is there anything onetime in nature to dimension this quarter with respect to bad debt.
I'm just wondering.
If you're still on track with that.
Guidance range put out a $3 million to $5 million for the year does that mean.
Bad debt came in a bit higher than expected because of that one time cost last quarter.
Well, we did was we did have one one time off from the first quarter, but bad debt continues to be well below our budgeted amount, but one 5% of total revenue and bad debt continues to be in line with our guidance for the year. The bulk of our bad debt continues to center on various tenant account adjustments.
The bulk of our bed does not related to tenant vacancies and historically the first six months of each year.
Track, a little bit higher than that and it drops off in the second half of the year and so on a run rate basis, we even though we budget one 5%, we typically wind up the year about 1% of total revenue or slightly better under.
Okay got it.
And I wanted to ask.
This kind of thing.
Become more topical lately with.
The lack of overall growth, we're seeing with them right.
Annual contractual rent bumps are you achieving on tenant now.
Is this increasing and where are you seeing.
Both on the anchor and non anchor side and how important do you think.
You know that.
That is Q.
Overall same store growth.
For the year.
In terms of.
How that would affect.
The lower too.
The low end to the higher end of that range.
So for shop tenants, we typically are still achieving the 3% annual increases on those leases, sometimes a touch higher.
And then on anchor leases, it's typically 10% to 12% every five years.
But that's obviously also offset by tenant who may have an option thats fixed or things like that.
Those those.
Annual increases are fairly consistent with the historic.
Okay, great, Thanks, and if I could ask one more.
Just on that.
Level of.
Leasing activity you said, what led the way really with the Portland portfolio.
Is could you speak more to the absorption youre seeing there like is it really a function of such limited supply or different.
Different dynamics in demand that you're seeing.
Yes, I think as you're touching on it is really the limited supply the Pacific Northwest is very difficult to develop new properties virtually nothing.
Come online.
<unk> has always led the way in terms of that but we're seeing those sort of the same trends in the other markets as well.
So certainly supply is having impact along with the overall demand from the tenant side. It's a combination of both that is really pushing the velocity of leasing more than anything else.
Great. Thank you.
When do you.
Thank you one moment please.
Our next question comes from the line of Wesley Golladay of Baird. Your line is open.
Hey, good morning, good morning Wes.
Hey, Stuart.
Just wanted to maybe go back to the debt questions that you have some debt maturities 'twenty three and 'twenty four and you kind of outlined last call about addressing them over the next two years with two offerings. What is your appetite to do maybe a little bit more this year and remove the potential overhang for shares as we look into next year.
Hey, Ross this is Mike so as I mentioned in my prepared remarks, we're looking to potentially do a deal upwards of.
400 million or up to $400 million that would take care of the 'twenty threes in half of the term loan.
It's a little bit too early to take up to 24 hours.
From a cost perspective, so what we're trying to communicate.
Communicate is doing a nice sized deal this year and then the other half of the term loan which is about swaps through August of next year becomes freely pre payable at that point.
The 24, so it's kind of kind of a back to back on the strategy there.
But if we if we have good market and the appetite is there for paper than we could do maybe a potential of large deal and have a little bit more of the term loan or take whatever balance we have a revolver pay that off as well so there's some flexibility there.
Got it and then you have mentioned you have a lot of options to pay off the debt you did mentioned one of them being secured debt.
You made a point over the last few years to remove a lot of secured debt. So is there a guess a pricing differential that you would need to see in order to take on more secured debt.
Well secure to assuming it's about 50% in property a leverage level in that southern share mature the rate would be probably in the low 6% range low to mid <unk>. So it's not that much different from where we think we could do a public deal. So I think they would have to be early.
Wider gap, where it makes sense because as you know we like to keep our properties unencumbered for maximum flexibility of the assets.
Got it thanks for the time everyone.
Thank you.
Thank you one moment please.
Our next question comes from the line of one Santa <unk> BMO capital markets. Your line is open.
Good morning Juan.
Good morning.
Just a question on guidance and how.
How comfortable are you guys with same store NOI and I guess that fulfill on the high end.
Given the year to date results.
And I guess with regard specifically to same store NOI.
What has to happen I guess to hit the mid to high end of that range there in terms of occupancy.
Given the.
But that occupy pipeline.
Well, our internal budget has the same center NOI growth ramping up as we move through the year, because we're tracking on a quarterly basis and at this point, we are on track to be within that guidance range of 2% to 5%.
But where we end up in the range will largely be a function of how many new tests open their stores and commence paying rent between now and year end.
As rich discussed as of June 30, we had just over $7 million of income.
Rental rent from new tenants that are currently working towards opening so that's going to drive that up.
Occupancy.
And tenant retention is high very high and so that will continue to help as well. It's just it's just.
Fundamentals continue to be as strong as they are then.
We feel pretty comfortable getting into that range.
Okay.
5% still in play.
Same store NOI or more comfort at the midpoint.
It's hard to say, there's a lot of moving parts of their work their way into the same store NOI.
We're sticking to that guidance range for now we'll see how the second half of the year plays out.
Okay and then one other question you guys had a couple of buy buy baby locations.
What's the latest in terms of what's going to happen with those.
If there's any risk to ramp falls out there with some of the proceedings that have happened.
Sure Yes.
We have too bye bye babies in the portfolio one of the leases was acquired by a private investor that lease actually expires next year, but it does have several renewal options remaining.
So on that one we should be made whole.
On the other buy buy baby at least half the space is leased to world markets.
And so we are in discussion with where market is about putting a new long term lease and directly with them.
And then for the remainder of that space.
Been out marketing it for quite some time now and we have got good preliminary interest from a number of prospective tenants. So.
We feel pretty confident we'll have that filled.
Thank you.
Yes.
Thank you one moment please.
Yes.
Our next question comes from the line of Michael Mueller of Jpmorgan. Your line is open.
Good morning.
100 <unk>.
Yes.
Apologize if I missed this but did you say with the volume.
The potential acquisitions that youre working on adds up to.
Well, we've guided the street $200 million.
We.
As we look through the balance of the year, given where the market is today, we're probably expecting to maybe lower that guidance a bit as we move to.
Towards depending on how the market changes of course, but right now we're certainly comfortable with about $75 million as we sit here today and then we'll see how the rest of the year shapes up in terms of what we would call deal flow in.
Access to capital in terms of growing the company.
Got it okay.
Thank you.
Thank you. Thank you.
Thank you one moment please.
Yeah.
Our next question comes from the line of Doric Houston of Wells Fargo. Your line is open.
Good morning.
Okay.
When you think through potential acquisitions Capex project to share repurchases, where do you think your greatest return today.
Well the Capex side is certainly continuing to fall because of how well highly leased we are.
And I think as rich touched on not much.
Is being given to these tenants both in terms of renewals and new leases.
As it relates to buy stock back.
We at the present time want to continue to monitor the market and make that decision as we move continue to move through the year, but.
More importantly acquisitions is where we're focused in terms of growing the company.
So.
If you were to priority prioritize those three I would tell you acquisitions is that the path.
And buying stock back is probably you know.
Third choices you would say.
Okay. Thank you.
Yes.
Thank you one moment please.
One moment.
Our next question comes from the line of Linda Tsai of Jefferies. Your line is open.
Hi, Thanks for taking my question.
Good morning, just a clarification you said you normally have more bad debt in the first half of the year and less in the second half.
Is this year consistent with prior years.
Yes, I would say so yes, it seems to be kind of a trend.
Second quarter is usually higher in the back half is lower but you get to that blended.
Actual bad debt, 1% or less of an annual basis.
Got it and then you have $7 million in incremental rent coming online. This year do you have a sense of how much is coming online next year.
Was that a <unk> perspective.
Of the $7 2 million and I believe that about 60% are supposed to start paying by the end of this year, another 25% or so by March the balance of the rest of 'twenty four.
Got it and then just one last one in terms of your ESG report are there any highlights to consider in terms of the progress you've made this year versus last year.
Yes, I mean, we've made some very good progress.
But I don't have the report sitting right in front of me, but it certainly gives you the details in terms of.
The great progress that the company has made the good news is that we are certainly trending above.
The goals that we had set initially.
In fact, we're in and so from that perspective.
Things are going better than what we had anticipated and I think you'll continue to see that progress as we move through 'twenty three right now as it relates to ESG. It's been it's been a big focus of managements time and again.
The progress is if you pick up the reporting read it but I think you will see that the progress has been quite strong.
Thank you.
Thank you one moment please.
Our next question comes from the line of RJ Milligan of Raymond James Your line is open.
Good morning.
Good morning, good afternoon.
Stuart you mentioned that Capex is coming down for ROIC.
But we are still seeing elevated ti capex spend for your peers and I'm curious is that just a function of your high occupancy is it.
It's more grocery focused versus power centers and I guess, maybe if you could just give some comments on where you see the negotiating power in terms of between landlords and retailers as they are looking for new stores.
Yes, I think that it is a function of the high occupancy I mean it makes.
We have multiple offers on the space and so we're able to go with the ones that were the strongest operators in the the best overall terms.
So that is I think what's the primary driver of that.
And then maybe I don't know if you could just.
On sort of where the pricing power is sort of in the market, maybe not necessarily for ROIC given your high occupancy but.
For the retailers the key retailers that are looking to open new stores.
How much how much pricing power do they have maybe not necessarily for rents, but from a ti capex spend perspective.
Well costs have gone up so I mean, the other thing you've really got to look at here as it relates to Capex is two things number one as rich articulated the overall demand supply aspects as it relates to being grocery anchored or.
Other types of retail.
But.
The other thing or the costs I mean to retrofit space today compared to pre COVID-19, you're spending at least a good let's call it 30%, 40% higher so that has some impact in terms of capex.
But the good news is that and I think again rich touched on that is that when you. This highly occupied the pendulum RJ certainly swings to the landlord and as it relates to spending those dollars and that's what we're continuing to see as we as we move through 'twenty three.
The ASF always you might say.
Aspect of our cash flow is continuing to get stronger.
I appreciate that thanks, guys Thats it for me.
Thank you.
I'm showing no further questions at this time I will just turn the call back over to Stuart pans for any closing remarks.
In closing thanks to all of you for joining us today as always we appreciate your interest in ROIC.
If you have any additional questions. Please contact Lauren Mike Rich or me directly also you can find additional information in the company's quarterly supplemental package and 10-Q, which are posted on our website as well as our latest ESG annual report.
Thanks, again and have a great day everyone.
Thank you ladies and gentlemen, this does conclude today's conference you may now disconnect have a great day.
Yeah.
Okay.
[music].