Q3 2023 DallasNews Corp Earnings Call
Speaker 1: Ladies and gentlemen, thank you for standing by. Welcome to the Dallas News Corporation 3rd quarter, 2023 Investor Conference Call. At this time, all participants are in a listen only mode. Later, we will conduct a question and answer session. Instructions will be given at that time. If you should require assistance during the call, please press star then zero. As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Gary Cobley. Please go ahead.
Ladies and gentlemen, thank you for standing by welcome to the Dallas News Corporation third quarter 2023, Investor Conference call. At this time all participants are in a listen only mode. Later, we will conduct a question and answer session and instructions will be given at that time, if you should require assistance during the call. Please.
Star then zero as a reminder, this conference is being recorded I would now like to turn the conference over to your host Gary Cowboy. Please go ahead.
Good morning, everyone. This is Gary <unk>, Vice President and controller, a Dallas News Corporation welcome to our third quarter 2023 Investor call.
Speaker 2: Good morning everyone. This is Gary Cowley, Vice President and Controller of Dallas News Corporation. Welcome to our third quarter, 2023 Investor Call.
Speaker 2: I am joined by Katie Murray, President and Chief Financial Officer, who will be reviewing financial results, and Grant Mowee, Chief Executive Officer, who will provide brief business remarks.
I'm joined by Katie Murray, President and Chief Financial Officer, who will be reviewing financial results and great movies, Chief Executive Officer, who will provide brief business remarks.
Yesterday afternoon, we issued a press release announcing third quarter 2023 results and filed our Q3 2023 10-Q.
Speaker 2: Yesterday afternoon, we issued a press release announcing third quarter 2023 results and filed our Q3 2023 10-Q .
Speaker 2: Both of these are posted on our website, DallasNewsCorporation.com, under the Investor Relations section.
Both of these are posted on our website downstairs Corporation Dot com under the Investor Relations section.
Speaker 2: Unless otherwise specified, comparisons used on today's call measure third quarter 2023 performance against third quarter 2022 performance.
Unless otherwise specified comparisons used on todays call measure third quarter 2023 performance against third quarter 2022 performance.
Speaker 2: Our discussion today will include forward-looking statements. Forward-looking statements are subject to risks, uncertainties, and other factors that could cause actual results to differ materially from those statements.
Our discussion today will include forward looking statements forward looking statements are subject to risks uncertainties and other factors that could cause actual results to differ materially from those statements.
Speaker 2: The company assumes no obligation to update the information in this communication, except as otherwise required by law. Additional information about these factors is detailed in the company's press releases and publicly available filings with the SEC.
The company assumes no obligation to update the information in this communication, except as other otherwise required by law additional information about these factors is detailed in the company's press releases and publicly available filings with the SEC.
Today's discussion will include non-GAAP financial measures, we believe that non-GAAP financial measures provide useful supplemental information to assist investors in determining performance comparisons to our peers.
Speaker 2: Today's discussion will include non-GAAP financial measures. We believe that non-GAAP financial measures provide useful supplemental information to assist investors in determining performance comparisons to our peers.
Speaker 2: A reconciliation of GAAP to non-GAAP financial measures is included with our press release.
Reconciliation of GAAP to non-GAAP financial measures is included with our press release.
I'll now turn the call over to Kate.
Good morning, everyone and thank you for joining today's call.
Speaker 3: Good morning everyone and thank you for joining today's call.
On a GAAP basis for the quarter Dallas News Corporation reported a net loss of $1 4 million or 26 cents per share and an operating loss of $1 6 million.
Speaker 3: On a GAT basis for the quarter, Dallas News Corporation reported a net loss of 1.4 million or 26 cents per share and an operating loss of 1.6 million. In Q3 of last year, we reported a net loss of 2.6 million and an operating loss of 2.3 million.
In Q3 of last year, we reported a net loss of $2 6 million and an operating loss of $2 3 million.
Speaker 3: On a non-gat basis for the quarter, we reported an adjusted operating loss of $900,000 and improved it of $700,000. When compared to an adjusted operating loss of $1.6 million reported for the same period last year.
On a non-GAAP basis for the quarter, we reported an adjusted operating loss of $900000 an improvement of 700000, when compared to an adjusted operating loss of $1 6 million reported for the same period last year.
Speaker 3: The improvement is primarily due to expense savings of $3.9 million.
The improvement is primarily due to expense savings of $3 9 million par.
Speaker 3: partially offset by a total revenue decline of $3.2 million.
Partially offset by a total revenue decline of $3 2 million.
Speaker 3: We reported 34.5 million of total revenue for the quarter compared to 37.7 million last year. The decline is primarily due to a $2 million or 18% decrease in print advertising revenue, which was driven by the company's strategic decision to exit its shared mail program to deliver weekly pre-printed inserts.
We reported $34 5 million of total revenue for the quarter compared to $37 7 million last year. The decline is primarily due to a $2 million or 18% decrease in print advertising revenue, which was driven by the company's strategic decision to exit its shared mail program to deliver weekly Preprinted inserts.
After accounting for this decline core print advertising was flat year over year.
Speaker 3: After accounting for this decline, core print advertising was flat year over year.
Digital advertising and marketing services revenue was down $800000 or 13% year over year, primarily due to a decline in marketing services revenue, resulting from some contract ending.
Partially offset by an increase in digital advertising on Dallas News Dot com, primarily related to financial service clients.
Circulation revenue was flat compared to last year.
Digital only subscription revenue increase of 700000 or 21, 4%, mostly offset the print circulation revenue decline of 800000 or six 1%.
Speaker 3: As of September 30th, the news had 66,563 digital only subscribers, which is a 2391 or 3.7% year-over-year improvement.
As of September 30, the news had 66563 digital only subscribers.
Which is a 2000 and 391 or three 7% year over year improvement.
Speaker 3: However, we did have a sequential decline in our digitally only subscribers.
However, we did have a sequential decline in our digital only subscribers.
Speaker 3: Grant is going to provide some additional comments on overall digital subscriber trends in a moment.
Grant is going to provide some additional comments on overall digital digital subscriber trends in a moment.
Speaker 3: Total subscribers, including both home delivery and digital subscribers, was 137,493 as of September 30th, compared to 144,631 as of Q3 last year, and 142,436 as of June 30th.
Total subscribers, including both home delivery and digital subscribers was 137493.
At September 30th compared to 144631 as of Q3 last year.
And 142436 as of June 30th.
Speaker 3: Printing distribution another revenue of 3.6 million a decrease of 300,000 or 8.3% when compared to the third quarter of 222. Primarily due to a decline in commercial printing revenue.
Printing distribution and other revenue was $3 6 million a decrease of 300000 or eight 3% when compared to the third quarter of 2022, primarily due to a decline in commercial printing revenue.
Speaker 3: On a non-GAT basis, total adjusted operating expense for the quarter was 35.4 million, and improvement of 3.9 million or 9.9 percent when compared to the same period of last year, driven by expense savings of 1.7 million in distribution, 900,000 in outside services and 800,000 in newsprint. The company will continue to experience savings in distribution expense for the remainder of the year with the recent discontinuation of the briefing and al-Dia publication.
On a non-GAAP basis total adjusted operating expense for the quarter was $35 4 million, an improvement of $3 9 million or nine 9% when compared to the same period of last year driven by expense savings of $1 7 million in distributions 900000 in outside services and 800000 in newsprint.
The company will continue to experience savings and distribution expense for the remainder of the year with the recent discontinuation of the briefing and L. D co locations.
Speaker 3: Newsprint expense is favorable year over year as the results of lower circulation and fewer out of market pre-prints when compared to last year.
Newsprint expense as favorable year over year as the result of lower circulation and fewer and fewer out of market pre prints when compared to last year.
Speaker 3: The newsprint purchase price has continued to trend favorably down. The cost of newsprint end September was $683 per metric ton, a decrease of $91 or 11.8% per metric ton when compared to September of last year. We expect to continue realizing these savings in late Q4 and early next year.
The newsprint purchase price has continued to trend favorably down the cost of newsprint and September was $683 per metric ton a decrease of $91 or 11, 8% per metric tonne when compared to September of last year.
We expect to can we expect to continue realizing these savings in late Q4 and early next year.
Speaker 3: As of September 30th, headcount was 608 down 60 headcount compared to last year. Headcount reductions and increased seven expense are expected to continue into the fourth quarter related to the previously announced voluntary staff reduction program.
As of September 30th head Count was 608 down 60 head count compared to last year head count reductions and increased severance expense are expected to continue into the fourth quarter related to the previously announced voluntary staff reduction program.
Speaker 3: Cash and short-term investments was $24.5 million on September 30th.
Cash and short term investments was $24 5 million on September 30th ads.
Speaker 3: As of October 20th, we have 23.3 million in cash, including short term in this.
As of October 20th we have $23 3 million in cash, including short term investments for.
Speaker 3: For the fourth quarter, the company recorded $100,000 of tax expense for the Texas franchise tax. I will now turn the call over to Grant.
For the fourth quarter the company recorded a $100000 of tax expense for the Texas franchise tax.
I will now turn the call over to grant.
Speaker 4: Thanks, Katie, and good morning, everyone. I want to start by mentioning an important event that took place in September of this year when Robert Decker retired after 50 years of service as an employee and 47 years as a director.
Thanks, Katie and good morning, everyone I want to start by mentioning an important event that took place in September of this year when Robert Bechard retired after 50 years of service as an employee and 47 years as a director Robert commitment to Dallas News Corporation in the North Texas region is hard to capture them.
Speaker 4: Robert's commitment to Dallas News Corporation and the North Texas region has hard to capture in words, but on behalf of the board and our employees, I wanna thank Robert for his commitment to journalism and for being a pillar of this institution for five wonderful decks.
Words, but on behalf of the board and our employees I want to thank Robert for his commitment to journalism and for being a pillar of this institution for five wonderful decades.
Speaker 4: Well, I'm on the topic of our commitment to journalism. I'm proud of our newsroom for the ambitious fentanyl series that was entitled Deadly Fake, where we published a story per day, every day for the entire month of September .
While I'm on the topic of our commitment to journalism I'm proud of our newsroom for the ambitious fentanyl series that was entitled definitely fake four republished eight story per day every day for the entire month of September we focused on Sentinel and this unique way because we because last year.
Speaker 4: We focused on Sentinel in this unique way because last year Sentinel killed an average of five Texans every day and almost 500 of them lived in North Texas.
Sentinel killed an average of five Texans everyday and almost 500 of them lived in North Texas.
Speaker 4: Most North Texans did not know how to identify nor treat the lethal effects of fentanyl. And in the words of Patrice Hardy, our executive editor, if this series helped save one life, it was worth it.
Most north Tech most north Texans did not know how to identify nor treat the lethal effects of Sentinel and in the words of Patrice Hardy our executive editor. If this series helped save one life it was worth it.
Speaker 4: Shifting topics from journalism to the financial progress of the company. We've had a year of mixed results. I've been pleased with the teams ongoing expense management. Katie was just referring to, but our revenue performance has fallen short of our expectations.
Shifting topics from journalism to the financial progress of the company, we've had Europe mixed results.
<unk> been pleased with the team's ongoing expense management, Katy was just referring to but our revenue performance has fallen short of our expectations. Many of you are familiar with the return to growth plan, we have in place with our board that we've been discussing for quite some time the.
Speaker 4: Many of you are familiar with the Return to Growth Plan. We have in place with our board that we've been discussing for quite some time.
Speaker 4: The goal of what we call the RTG plan is to build a sustainably profitable media and marketing company.
The goal of what we call. The RTG plan is to build a sustainably profitable media and marketing company for this plan to ultimately be successful we need to grow revenue from our core product lines of digital membership digital advertising and marketing services. This year, we have grown in two of those three areas.
Speaker 4: So this plan to ultimately be successful, we need to grow revenue from the core product lines of digital membership, digital advertising, and marketing service.
Speaker 4: This year we have grown in two of those three areas, but we want to see growth in all three.
But we wanted to see growth in all three.
Speaker 4: In the third quarter, we were more aggressive with the pricing of our digital subscription offering. And I'm pleased with the early returns from this chain.
In the third quarter, we were more aggressive with the pricing of our digital subscription offering and I am pleased with the early returns from this change.
Speaker 4: This change will result, as we are seeing, in short-term volume declines, but will improve the revenue trajectory of digital subscription revenue.
This change will result, as we are seeing in short term volume declines, but will improve the revenue trajectory of digital subscription revenue.
Speaker 4: On the marketing services side of the business at medium giant, this year has been marked by trepidation from our current clients who are being cautious with their advertising dollars in the midst of a challenging economic environment.
On the marketing services side of the business at medium giant. This year has been marked by trepidation from our current clients, who are being cautious with their advertising dollars in the midst of a challenging economic environment.
Speaker 4: In order for us to return to growth in this important area, we are focused on attracting new retainer-based clients while helping our current clients with marketing solutions to help them grow their businesses. Greg, we will now open.
In order for us to return to growth in this important area. We are focused on attracting new retainer based clients, while helping our current clients with marketing solutions to help them grow their businesses.
Greg We will now open up the line for questions.
Speaker 1: Thank you. Ladies and gentlemen, if you'd like to ask a question, please press 1 then 0 on your telephone keypad. You may withdraw your question at any time by repeating the 1-0 command. If you're using a speakerphone, please pick up the handset before pressing the numbers. Once again, if you have a question, please press 1 then 0 at this time. And one moment, please.
Thank you, ladies and gentlemen, if you'd like to ask a question. Please press. One then zero on your telephone keypad you may withdraw your question at any time by repeating the one zero command if youre using a speakerphone. Please pick up the handset before pressing the numbers. Once again, if you have a question. Please press one zero at this time and one moment. Please.
And at this time there are no questions.
Speaker 2: Well, Greg, thank you. Thank you, everyone, for joining our call. I'm sorry, Greg. You just had one queue up. Would you like to take that question? Absolutely. Okay. That question comes from the line of Chris Mooney from Wedbush Securities. Please go ahead. Hey, good morning, all. Good morning, Chris. The 608...
Well great. Thank you. Thank you everyone for joining our call I'm sorry, Greg.
You just had one queue up would you like to take that question.
Absolutely. Okay that question comes from the line of Chris Mooney from Wedbush Securities. Please go ahead.
Hey, good morning, all.
Good morning, Chris.
The 608 head count.
Where do you anticipate that going to.
By the end of the year.
Speaker 3: You know, Chris, as we announced earlier, probably about a month ago, we did have a, we're having a voluntary severance offer. We expect probably about maybe 40 or so people to take that, give or take. We don't know yet. There was not a set target. We didn't have any kind of specific headcount number or expense number. So I expect that this number.
You know Chris.
As we announced earlier put out about a month ago we.
We did have a were having a voluntary severance offer we expect probably about maybe 40 or so people to take that and you protect we don't know yet there was not a set target. We didn't have any kind of specific head count number or expense number. So I expect that this number.
Speaker 3: We will probably be, we're gonna be below 600, probably maybe 580, 570, just depending on what we do with the DSO. And again, that's just to be determined.
We will probably be we're going to be below 600, probably maybe 580 570, just depending on what we do with the with the DSO and again Thats just to be determined.
Speaker 2: Understood. And the cost of this will appear in the fourth quarter. Will it roll into the first quarter as well?
Understood.
And the cost of this well.
Here in the fourth quarter will roll into the.
First quarter as well.
Speaker 3: No, it won't. The cost of the offering in the program will be fully booked in the fourth quarter. And while there may be cash payments in 2024, the expense will be in 2023. Okay.
No it won't.
The cost of the offering and the program will be fully booked in the fourth quarter and while there may be cash payments in 2024 the extensively in 2023.
Okay.
And what was the Union response to this.
As part of our collective bargaining agreement, we have the ability to offer a voluntary severance offering whenever we would like to so there really was no response from the Guild.
Okay.
Thank you.
Thank you Chris.
If there are any additional questions. Please press one zero.
Speaker 1: Okay. Well, again, Greg, sorry, there are no further questions.
Okay, well again, Greg sorry, there are no further questions.
Great. Thank you everyone. Thank you again for joining our third quarter call, we look forward to.
A great fourth quarter, and we will have our earnings call in the first quarter of next year.
Operator: Ladies and gentlemen, thank you for standing by. Welcome to the Dallasnews Corporation 3rd quarter, 2023 Investor Conference Call. At this time, all participants are in a listen only mode.
And for those of you in Dallas, and Texas Rangers.
Ladies and gentlemen that does conclude your conference for today. Thank you for your participation and for using AT&T Teleconferencing you may now disconnect.
Operator: Later, we will conduct a question and answer session. Instructions will be given at that time. If you should require assistance during the call, please press star then zero. As a reminder, this conference is being recorded.
Operator: I would now like to turn the conference over to your host, Gary Cobleigh. Please go ahead.
Gary Cobleigh: Good morning, everyone. This is Gary Cobleigh, Vice President and Controller of Dallasnews Corporation. Welcome to our 3rd quarter, 2023 Investor Call. I am joined by Katie Murray, President and Chief Financial Officer, who will be reviewing financial results and Grant Moise, Chief Executive Officer, who will provide brief business remarks. Yes, 2023-2023-10Q. Both of these are posted on our website, Dallasnewscorporation.com, under the Investor Relations section. Unless otherwise specified, comparisons used on today's call measure 3rd quarter, 2023 performance, against 3rd quarter, 2022 performance.
We're sorry.
Speaker 5: We're sorry, your conference is ending now. Please hang up.
Your conferences ending now please hang up.
Gary Cobleigh: Our discussion today will include forward looking statements. Forward looking statements are subject to risks, uncertainties and other factors that could cause actual results to differ materially from those statements. The company assumes no obligation to update the information in this communication, except as otherwise required by law. Additional information about these factors is detailed in the company's press releases and publicly available filings with the SEC. Today's discussion will include non-GAP financial measures. We believe that non-GAP financial measures provide useful supplemental information to assist investors in determining performance comparisons to our peers. A reconciliation of GAP to non-GAP financial measures is included with our press release.
Katie Murray: I'll now turn the call over to Katie.
Katie Murray: Good morning, everyone, and thank you for joining today's call. On a GAP basis for the quarter, Dallasnewscorporation reported a net loss of 1.4 million or 26 cents per share and an operating loss of 1.6 million. In Q3 of last year, we reported a net loss of 2.6 million and an operating loss of 2.3 million. On a non-GAP basis for the quarter, we reported an adjusted operating loss of $900,000 and improvement of 700,000 when compared to an adjusted operating loss of 1.6 million reported for the same period last year.
Katie Murray: The improvement is primarily due to expense savings at 3.9 million, partially offset by a total revenue decline of 3.2 million. We reported 34.5 million of total revenue for the quarter compared to 37.7 million last year. The decline is primarily due to a 2 million or 18 percent decrease in print advertising revenue, which was driven by the company's strategic decision to exit its shared mail program to deliver weekly preprints and inserts. After accounting for this decline, core print advertising was flat year over year.
Katie Murray: Digital advertising and marketing services revenue was down $800,000 or 13 percent year over year. Primarily due to a decline in marketing services revenue, resulting from some contract ending, partially offset by an increase in digital advertising on Dallasnews.com primarily related to financial service clients. Circulation Revenue was black compared to last year. The digital only subscription revenue increase of 700,000 or 21.4%, mostly offset the print circulation revenue decline of 800,000 or 6.1%. As of September 30, the news had 66,563 digital only subscribers, which is a 2,391 or 3.7% year-over-year improvement. However, we did have a sequential decline in our digital only subscribers.
Katie Murray: Grant is going to provide some additional comments on overall digital subscriber trends in a moment. Total subscribers, including both home delivery and digital subscribers, was 137,493 as of September 30, years, compared to 144,631 as of Q3 last year, and 142,436 as of June 30. Printing distribution another revenue of 3.6 million a decrease of 300,000 or 8.3% when compared to the third quarter of 22 and 2, primarily due to a decline in commercial printing revenue.
Katie Murray: On a non-gap basis, total adjusted operating expense of the quarter was 35.4 million and improvement of 3.9 million or 9.9% when compared to the same period of last year driven by expense savings of 1.7 million in distribution, 900,000 in outside services, and 800,000 in news print. The company will continue to experience savings in distribution expense for the remainder of the year with the recent discontinuation of the briefing and Aldea publications. News print expense is favorable year-over-year as the results of lower circulation and fewer out-of-market preprints when compared to last year.
Katie Murray: The news print purchase price has continued to trend favorably down. The cost of news print in September was $683 per metric ton, a decrease of $91 or 11.8% per metric ton when compared to September of last year. We expect to continue realizing these savings in late Q4 and early next year. As of September 30th, headcount was 608 down, 60 headcount compared to last year. Headcount reductions and increase of an expense are expected to continue into the fourth quarter related to the previously announced voluntary staff reduction program. Cash and short-term investments was expected to continue to increase. As of October 20th, we have 23.3 million in cash including short-term investments.
Katie Murray: For the fourth quarter, the company recorded $100,000 of tax expense for the Texas franchise tax.
Grant Moise: I will now turn the call over to Grant. Thanks, Katie, and good morning everyone.
Grant Moise: I want to start by mentioning an important event that took place in September of this year when Robert Decker retired after 50 years of service as an employee and 47 years as a director. Robert's commitment to Dallas News Corporation and the North Texas region is hard to capture in words, but on behalf of the board and our employees, I want to thank Robert for his commitment to journalism and for being a pillar of this institution for five wonderful days.
Grant Moise: Well, I'm on the topic of our commitment to journalism. I'm proud of our newsroom for the ambitious fentanyl series that was entitled Deadly Fake, where we published a story per day, every day, for the entire month of September. We focused on fentanyl in this unique way, because last year, fentanyl killed an average of five Texans every day and almost 500 of them lived in North Texas. Most North Texans did not know how to identify nor treat the lethal effects of fentanyl. And in the words of Patrice Hardy, our executive editor, if this series helped save one life, it was worth it.
Grant Moise: Shifting topics from journalism to the financial progress at the company, we've had a year of mixed results. I've been pleased with the teams on going expense management. Katie was just referring to, but our revenue performance has fallen short of our expectations. Many of you are familiar with the Return to Growth Plan. We have in place with our board that we've been discussing for quite some time. The goal of what we call the RTG plan is to build a sustainably profitable media and marketing company.
Grant Moise: For this plan to ultimately be successful, we need to grow revenue from the core product lines of digital membership, digital advertising, and marketing services. This year, we have grown in two of those three areas, but we want to see growth in all three. In the third quarter, we were more aggressive with the pricing of our digital subscription offering. And I'm pleased with the early returns from this change. This change will result, as we are seeing in short-term volume declines, but will improve the revenue trajectory of digital subscription revenue.
Grant Moise: On the marketing services side of the business at medium giant, this year has been marked by trepidation from our current clients who are being cautious with their advertising dollars in the midst of a challenging economic environment. In order for us to return to growth in this important area, we are focused on attracting new retainer-based clients while helping our current clients with marketing solutions to help them grow their businesses.
Operator: Greg, we will now open up the line for questions.
Operator: Thank you, ladies and gentlemen. If you'd like to ask a question, please press one then zero on your telephone keypad. You may withdraw your question at any time by repeating the one zero command. If you're using a speaker phone, please pick up the handset before pressing the numbers. Once again, if you have a question, please press one then zero at this time. And one moment, please. And at this time, there are no questions.
Operator: Well, Greg, thank you. Thank you, everyone, for joining our call. I'm sorry, Greg. You just had one queue up.
Operator: Would you like to take that question? Absolutely.
Operator: Okay, that question comes from the line of Chris Mooney from Wedbush Securities. Please go ahead.
Chris Mooney: Good morning, all. Good morning, Chris. The 608 headcount, where do you anticipate that going to by the end of the year? You know, Chris, as we announced earlier, probably about a month ago, we did have a, we're having a voluntary severance offer. We expect probably about maybe 40 or so people to take that. We don't know yet. There was not a set target. We didn't have any kind of specific headcount number or expense number.
Chris Mooney: So I expect that this number, we will probably, the, we're going to be below 600, probably maybe by 80, by 70, just depending on what we do with the, with the DSO. And again, that's just to be determined, and the cost of this will appear in the fourth quarter. Will it roll into the first quarter as well? No, it won't. The cost of the offering in the program will be fully booked in the fourth quarter.
Chris Mooney: And while there may be cash payments in 2024, the expense will be in 2023. Okay. What was the union response to this? As part of our collective bargaining agreement, we have the ability to offer a voluntary severance offering whenever we would like to, so there really was no response from the guild. Okay. Thank you. Thank you, Chris. If there are any additional questions, please press one and zero. Okay. And again, Greg, sorry. There are no further questions. Greg, thank you.
Grant Moise: Everyone, thank you again for joining our third quarter call. We look forward to a great fourth quarter and we'll have our earnings call in the first quarter of next year. And for those of you in Dallas and Texas, go Rangers.
Operator: Ladies and gentlemen, that does conclude your conference for today. Thank you for your participation and for using AT&T teleconferencing. You may now disconnect. We're sorry. Your conference is ending now.
Operator: Please hang up.