Q1 2025 PetMed Express Inc Earnings Call

Speaker Change: [music].

Operator: Greetings and welcome to PetNetExpress.com. At this time, all participants are in a listen-only mode.

Operator: Greetings and welcome to Petmed Express' first quarterly financial results conference call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Reed Anderson, of ICR. You may begin.

Greetings and welcome to putting that express first quarter financial results Conference call.

Speaker Change: At this time all participants are in a listen only mode.

Operator: A question and answer session will follow the formal presentation. As a reminder, this conference is being recorded.

Speaker Change: A question and answer session will follow the formal presentation.

Speaker Change: As a reminder, this conference is being recorded.

Reed Anderson: It is now my pleasure to introduce your host, Reed Anderson, with ICR.

Speaker Change: It is now my pleasure to introduce your host Reid Anderson with ICR you may begin.

Reed Anderson: You may begin. Thank you, operator.

Reid Anderson: Thank you operator.

Sandra Campos: I'd like to welcome everybody here today to the PetNetExpress fiscal first quarter 2025 earnings conference call. Certain information that will be included during this call may include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, and the Securities Exchange Act of 1934, as amended, that may involve a number of risks and uncertainties. These statements are based on our beliefs as well as assumptions we have used. Based upon information currently available to us. Because these statements reflect our current views concerning future events, these statements involve risks and uncertainties and assumptions. Action results could differ materially from those projected.

Reed Anderson: And I'd like to welcome everybody here today to the Petmed Express Fiscal First Quarter 2025 Earnings Conference. Certain information that will be included during this call may include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and the Securities Exchange Act of 1934, as amended, that may involve a number of risks and uncertainties. These statements are based on our beliefs, as well as assumptions we have made based upon information currently available to us.

Reid Anderson: I'd like to welcome everybody here today, the pet Meds Express fiscal first quarter 2025 earnings conference call.

Speaker Change: Certain information that will be included during this call may include forward looking statements within the meaning of the private Securities Litigation Reform Act of 1995, and the Securities Exchange Act 1934 as amended it may involve a number of risks and uncertainties. These.

Speaker Change: These statements are based on our beliefs as well as assumptions we have used based upon information currently available to us.

Reed Anderson: Because these statements reflect our current views concerning future events, these statements involve risks, uncertainties, and assumptions. The actual results could differ materially from those projected. There can be no assurance that any forward-looking results will occur or be realized. And nothing contained in this presentation is or should be relied upon as a representational warranty as to any future matter, including any matter in respect to the operations or business, or financial condition of Petmed.

Speaker Change: Because these statements reflect our current views concerning future events. These statements involve risks uncertainties and assumptions actual results could differ materially from those projected there can be no assurance that any forward looking results will occur or be realized nothing contained in this presentation is or should be relied upon as a representation of warranty as to any future.

Sandra Campos: There can be no assurance that any forward-looking results will occur or be realized.

Sandra Campos: Nothing contained in this presentation is or should be relied upon as a representation of warranty as to any future matter, including any matter in respect to the operations or business, or financial condition of Pet Meds. Pet Meds undertakes no obligation to update publicly these forward-looking statements based on subsequent events, except as may be required by applicable law, regulation, or competent legal authority.

Speaker Change: Matter, including any matter in respect to the operations of our business.

Speaker Change: Our financial condition of pet meds.

Reed Anderson: Petmeds undertakes no obligation to update publicly these forward-looking statements based on subsequent events except as may be required by applicable law, regulation, or competent legal authority. We have identified various risk factors associated with our operations in our most recent annual report and other filings with the Securities and Exchange Commission. Now, let me turn the call over to our CEO and President, Sandra Campos.

Speaker Change: <unk> undertakes no obligation to update publicly these forward looking statements based on subsequent events, except as may be required by applicable law regulation or constant legal authority.

Sandra Campos: We have identified various risk factors associated with our operations in our most recent report and other filings with Securities Exchange Commission.

Speaker Change: We have identified various risk factors associated with our operations in our most recent annual report and other filings with the Securities and Exchange Commission now, let me turn the call over to our CEO and President Santos Campos Sandra.

Reed Anderson: Now, let me turn the call over to our CEO and President, Sandra Campos.

Sandra Campos: Sandra? Thanks, Raid, and thank you to everyone for joining our conference call this afternoon. Following my remarks, Christine will provide an overview of our financials, after which we will open the lines for your questions.

Sandra Campos: Thanks, Raid, and thank you to everyone for joining our conference call this afternoon. Following my remarks, Christine will provide an overview of our financials, after which we will open the lines for your questions.

Speaker Change: Thanks, Craig and thank you everyone for joining our conference call. This afternoon.

Speaker Change: Following my remarks, Christine will provide an overview of our financials after which we will open the lines for your question.

Sandra Campos: As we close out the first quarter of our fiscal year 2025, it's important to note that Q1 results reflect a transition quarter for the company. May was my first full month of CEO, and during the quarter we added several highly experienced executives from top tier retail backgrounds. We added a new Chief Marketing Officer, a new Chief Operating Officer, and a new Chief Digital and Technology Officer, all of whom joined our executive ranks in May and June. As we continue to strengthen our organizational leadership, we're also excited to welcome Doug Croulick as our new Chief Accounting Officer starting August 19.

Sandra Campos: As we close out the first quarter of our fiscal year 2025, it's important to note that Q1 results reflect a transition quarter for the company. May was my first full month as CEO, and during the quarter, we added several highly experienced executives from top-tier retail backgrounds. We added a new chief marketing officer, a new chief operating officer, and a new chief digital and technology officer, all of whom joined our executive ranks in May and June.

Christine: As we close out the first quarter of our fiscal year 2025, it's important to note that Q1 results reflect the transition quarter for the company.

Christine: With my first full month as CEO and during the quarter. We added several highly experienced executives from top tier retail background. We added a new chief marketing officer, a new Chief operating officer, and a new Chief Digital and Technology Officer, all of whom joined our executive ranks in May and June.

Sandra Campos: As we continue to strengthen our organizational leadership, we're also excited to welcome Doug Krulik as our new Chief Accounting Officer, starting August 19th. Doug brings more than 20 years of leadership experience in accounting operations, compliance, and internal controls, aligning with our focus on enhancing operational excellence and strengthening financial governance. Additionally, we've been strategic in adding new independent directors to the board, and we're pleased to welcome Justin Menon and Leah Solibane as new independent directors.

Christine: We continue to strengthen our organizational leadership. We're also excited to welcome John <unk> as our new Chief Accounting Officer, starting August 19th.

Sandra Campos: That brings more than 20 years of leadership experience in accounting operations, compliance, and internal controls, aligning with our focus on enhancing operating regional excellence and strengthening financial governance. Additionally, we've been strategic in adding new independent directors to the board, and we're pleased to welcome Justin Menon and Leah Soliban as new independent directors. There are extensive expertise in digital technology, innovation, and cybersecurity will greatly benefit our transformation efforts and will help us address the significant long-term opportunities in this $150 billion pet care market.

Speaker Change: <unk> brings more than 20 years of leadership experience in accounting operations compliance and internal control aligning with our focus on enhancing operational excellence and strengthening financial governance.

Speaker Change: Additionally, we've been strategic and adding new independent directors to the board and we're pleased to welcome Justin Mennen and Leah she'll be born as new independent directors.

Sandra Campos: Their extensive expertise in digital technology, innovation, and cybersecurity will greatly benefit our transformation efforts and will help us address the significant long-term opportunities in this $150 billion pet care market. Today, I'll begin with a review of our recent performance and the results from the first quarter. However, my primary focus will be on the strategic initiatives that we are implementing to reposition the company for future success. Our new leadership team is taking significant actions in key areas to drive Petmed and PetcareRx toward growth and profitability.

Speaker Change: Our extensive expertise in digital technology innovation, and cyber security will greatly benefit our transformation effort and will help us address the significant long term opportunities in this $150 billion pet care market.

Sandra Campos: Today, I'll begin with a review of our recent performance and the results from the first quarter. However, my primary focus will be on the strategic initiatives that we are implementing to reposition the company for future success. Our new leadership team is taking significant actions in key areas to drive pet meds and pet care RX towards growth and profitability. Our focus is on enhancing operational performance, optimizing our cost structure, invigorating customer growth, and ultimately improving shareholder returns. To be clear, the Q1 financial results do not fully reflect the positive impact of the new team's improvements, which we gained in the latter half of the quarter.

Speaker Change: Today I'll begin with a review of our recent performance and the results from the first quarter. However, my primary focus will be on the strategic initiatives that we're implementing to reposition the company for future success.

Speaker Change: Our new leadership team is taking significant actions in key areas to drive its pet meds and pet care, our ex towards growth and profitability.

Sandra Campos: Our focus is on enhancing operational performance, optimizing our cost structure, invigorating customer growth, and ultimately improving shareholder returns. To be clear, the Q1 financial results do not fully reflect the positive impact of the new team's improvements, which began in the latter half of the quarter.

Speaker Change: Our focus is on enhancing operational performance optimizing our cost structure invigorating customer growth and ultimately improving shareholder returns.

Speaker Change: To be clear the Q1 financial results do not fully reflect the positive impact of the new team's improvement which began in the latter half of the quarter.

Sandra Campos: We've made strong progress on key cost reduction initiatives, including the consolidation and streamlining of operations between Pet Meds and Pet Care RX. Additionally, our new team has begun to advance our customer growth strategies through an evolution of our site, introducing enhanced creative and engaging messaging, and targeted effective media spend. Our recent technology improvements will create incremental value through the development of a more seamless customer journey and will facilitate order speed to delivery. We're gaining momentum, and we're seeing early signs of improvement in these key leading indicators, including increased order values, reduced call weight and handling times, and improved margins, just to name a few.

Sandra Campos: We've made strong progress on key cost reduction initiatives, including the consolidation and streamlining of operations between Petmed and PetcareRx. Additionally, our new team has begun to advance our customer growth strategies through an evolution of our site, introducing enhanced creative and engaging messaging and targeted effective media spend. Our recent technology improvements will create incremental value through the development of a more seamless customer journey and will facilitate order speed to delivery. We're gaining momentum, and we're seeing early signs of improvement in these key leading indicators, including increased order values, reduced call weight and handling times, and improved margins, just to name a few.

Speaker Change: We've made strong progress on key cost reduction initiatives, including the consolidation and streamlining of operations between pet meds, and pet care or X <unk>.

Speaker Change: Additionally, our new team has begun to advance our customer growth strategies through an evolution of our site introducing enhanced creative and engaging messaging and targeted effective media spend.

Speaker Change: Our recent technology improvements will create incremental value through the development of a more seamless customer journey and will facilitate order speed to delivery.

Speaker Change: We're gaining momentum and we're seeing early signs of improvement in these key leading indicators, including increased order value reduced call wait and handling time and improved margins just to name a few.

Sandra Campos: These key indicators reflect a reversal of previous trends and further validate our strategy to create an ecosystem of products and services for pets' well-being and longevity.

Sandra Campos: These key indicators reflect a reversal of previous trends and further validate our strategy to create an ecosystem of products and services for pets' well-being and longevity. For the Q1 fiscal year of 2025, our results were below expectations, with sales down 13% compared to last year, as well as a 230 basis point decrease in growth margin.

Speaker Change: These key indicators reflect a reversal of previous trends and further validate our strategy to create an ecosystem of products and services for pets wellbeing and longevity.

Sandra Campos: For Q1 fiscal year of 2025, our results were below expectations with sales down 13% compared to last year, as well as the 230 basis point decrease in growth margins. This to crime reflects broader macroeconomic factors, higher consumer promotional usage, and specific technological challenges, which have and are being addressed. As a bright spot, operational efficiency improved as evidenced by a 20% improvement in inventory terms and an 11% reduction in our ending inventory versus last year. Since I've come on board, I have looked at and will continue to look at all of our metrics to make sure that they align with our competitive steps.

Speaker Change: For Q1 fiscal year of 2025, our results were below expectations with sales down 13% compared to last year as well as the 230 basis point decrease in gross margin.

Sandra Campos: This decline reflects broader macroeconomic factors, higher consumer promotional usage, and specific technological challenges which have and are being addressed. As a bright spot, operational efficiency improved, as evidenced by a 20% improvement in inventory returns and an 11% reduction in our ending inventory bursts last year. Since I've come on board, I've looked at and will continue to look at all of our metrics to make sure that they align with our competitive steps.

Speaker Change: This decline reflects broader macroeconomic factors higher consumer promotional usage and specific technological challenges, which have and are being addressed.

Speaker Change: As a bright spot operational efficiency improved as evidenced by a 20% improvement in inventory turns and an 11% reduction in our ending inventory versus last year.

Speaker Change: Since I've come on board I have looked at and will continue to look at all of our metrics to make sure that they align with our competitive set.

Sandra Campos: Several years ago, we redefined what constitutes a new customer, defining it as a customer who had not purchased from us in three years. Utilizing that existing definition, we reported 75,000 new customers in the first quarter of fiscal 2025 on the 10-Q. These new customers were achieved despite a 20% strategic reduction in media fed, and that resulted in an 8% improvement in customer acquisition costs. Starting in the second quarter, we will officially update this metric to be more in line with retail industry standards, which typically measures new customers on a 12-month cycle. Our focus remains steadfast on the strategic initiatives that are pivotal to repositioning pet meds and pet care RX for long-term success.

Sandra Campos: Several years ago, we redefined what constitutes a new customer, defining it as a customer who had not purchased from us in three years. Utilizing that existing definition, we reported 75,000 new customers in the first quarter of fiscal 2025 on the 10Q.

Speaker Change: Several years ago, we redefined what constitutes a new customer defining it as a customer who had not purchased from us in three years.

Speaker Change: Utilizing the existing definition, we reported 75000, new customers in the first quarter of fiscal 'twenty 25 on the 10-Q.

Sandra Campos: These new customers were achieved despite a 20% strategic reduction in media spend, and that resulted in an 8% improvement in customer acquisition costs. Starting in the second quarter, we will officially update this metric to be more in line with retail industry standards, which typically measure new customers on a 12-month cycle. Our focus remains steadfast on the strategic initiatives that are pivotal to repositioning PetMeds and PetCareRx for long-term success. Since the first week of July, we have seen positive indicators that validate the commercial, operational, and financial actions that are being taken.

Speaker Change: These new customers were achieved despite a 20% strategic reduction in media spend and that resulted in an 8% improvement in customer acquisition costs.

Speaker Change: Starting in the second quarter, we will officially update this metric to be more in line with retail industry standards, which typically measures new customers on a 12 month cycle.

Speaker Change: Our focus remains steadfast on the strategic initiatives that are pivotal to repositioning pet meds and pet care Rx for long term success.

Sandra Campos: Since the first week of July, we have seen positive indicators that validate the commercial, operational, and financial actions that are being taken. For example, compared to our last year, our web visits increased by 4% due to a focus on organic search engine optimization, and we had a conversion rate uplift of 12% as a result of optimization of digital customer experiences. Along with these key metrics that will continue to improve conversion, our media spend was strategically reduced by 20% compared to last year. We have focused our efforts on revising our overall marketing strategy, including the realignment of outside agency partners in order to convert leads more efficiently.

Speaker Change: Since the first week of July we have seen positive indicators that validate the commercial operational and financial actions that are being taken for.

Sandra Campos: For example, compared to last year, our web visits increased by 4% due to a focus on organic search engine optimization, and we had a conversion rate uplift by 12% as a result of the optimization of the digital customer experience. Along with these key metrics that will continue to improve conversion, our media spend was strategically reduced by 20% compared to last year.

Speaker Change: For example, compared to last year, our web visits increased by 4% due to a focus on organic search engine optimization, and we had a conversion rate uplift by 12% as a result of optimization of digital customer experiences.

Speaker Change: Along with these key metrics that will continue to improve conversion our media spend with Joe's T chicle reduced by 20% compared to last year.

Sandra Campos: We have focused our efforts on revising our overall marketing strategy, including the realignment of outside agency partners in order to convert leads more efficiently. As a result of these efforts, as well as others, our average order value and our growth margin have improved month over month compared to last year. For the past three months, my focus has been on optimizing our organizational structure and engaging with our stakeholders, both internally and externally.

Speaker Change: We have focused our efforts on revising our overall marketing strategy, including a realignment of outside agency partners in order to convert leads more efficiently.

Sandra Campos: As a result of these efforts, as well as others, our average order value and our growth margin have improved month-over-month compared to last year.

Speaker Change: As a result of these efforts as well as others, our average order value and our gross margin have improved month over month compared to last year.

Sandra Campos: Over the past three months, my focus has been on optimizing our organizational structure and engaging with our stakeholders, both internally and externally. I've dedicated substantial times understanding customer experiences and addressing the operational challenges in our pharmacy, customer call center, and fulfillment centers. Our new executive leadership team has been actively involved with me in shaping our transformation strategies. These strategies aim to drive efficiencies, grow our customer base, expand our market share, and stabilize our infrastructure. Key outlets include an enhanced tech stack, improved data architecture, system upgrades, and a modernized customer experience through better site navigation. It improves cart and checkout processes and strong SEO SCM initiatives.

Speaker Change: Over the past three months my focus has been on optimizing our organizational structure and engaging with our stakeholders, both internally and externally I've dedicated substantial time understanding customer experiences and addressing the operational challenges in our pharmacy customer call center and fulfillment centers.

Sandra Campos: I've dedicated substantial time to understanding customer experiences and addressing the operational challenges in our pharmacy, customer call center, and fulfillment centers. Our new executive leadership team has been actively involved with me in shaping our transformation strategy. These strategies aim to drive efficiencies, grow our customer base, expand our market share, and stabilize our infrastructure. Key elements include an enhanced tech stack, improved data architecture, system upgrades, and a modernized customer experience through better site navigation, improved cart and checkout processes, and strong SEO-SEM initiatives.

Speaker Change: Our new executive leadership team has been actively involved with me and shaping our transformation strategies.

Speaker Change: These strategies aimed to drive efficiencies and grow our customer base expand our market share and stabilize our infrastructure.

Speaker Change: Key elements include an enhanced tech stack improved data architecture system upgrades and modernize the customer experience through better site navigation.

Speaker Change: Proves cart and checkout processes and strong S. C O S T M initiatives.

Sandra Campos: Additionally, we are implementing a product strategy that includes skew rationalization and optimization, and have negotiated for improved costs across the supply chain. I've engaged with key vendors, strategic partners, and many of you are investors to align efforts and drive forward our shared goals. In all of my interactions, I've consistently communicated one message. Our performance over the last several years is not acceptable, and the combined enterprise of pet meds and pet carrex has significant potential for improvement.

Sandra Campos: Additionally, we are implementing a product strategy that includes SKU rationalization and optimization and have negotiated for improved costs across the supply chain. I've engaged with key vendors, strategic partners, and many of you, our investors, to align efforts and drive forward our shared goals. In all of my interactions, I've consistently communicated one message.

Speaker Change: Additionally, we are implementing a product strategy that includes SKU rationalization and optimization and have negotiated for improved cost across the supply chain.

Speaker Change: I've engaged with key vendors strategic partners and many of you our investors to align efforts and drive forward our shared goals.

Speaker Change: And all of my interactions I have consistently communicated one message our performance over the last several years is not acceptable and the combined enterprise the pet Meds and Pet care Act has significant potential for improvement.

Sandra Campos: Our performance over the last several years is not acceptable, and the combined enterprise of Petmed and PetcareRx has significant potential for improvement. While the turnaround will take time, we believe we are on a clear path to restoring the company to profitable growth, with early indicators confirming that our recent actions are yielding positive results. Building on our 28-year legacy and our strong brand equity, we're transforming Petmed and PetcareRx into a dynamic ecosystem for pet products and services tailored to meet the evolving needs of today's consumers.

Sandra Campos: While the turnaround will take time, we believe we are on a clear path to restoring the company to profitable growth, with early indicators confirming that our recent actions are yielding positive results. Building on our 28 year of legacy and our strong grand equity, we're transforming pet meds and pet care rx into a dynamic ecosystem for pet products and services tailored to meet the evolving needs of today's consumers.

Speaker Change: While the turnaround will take time, we believe we are on a clear path to restoring the company to profitable growth with early indicators confirming that our recent actions are yielding positive results.

Speaker Change: Building on our 28 year legacy and our strong brand equity, we are transforming pet meds and pet care Rx into a dynamic ecosystem for pet products and services tailored to meet the evolving needs of today's consumers.

Sandra Campos: During our Q4 earnings call in June, I outlined priorities, including the consolidation of pet meds and pet care Rx for operational efficiencies, reducing costs across both organizations, and a continued focus on maintaining a healthy liquidity position. In the second half of Q1, we initiated these efforts, resulting in approximately $5 million in annualized cost savings, which we will realize over the coming months. Our balance sheet remains strong, and as of the beginning of August, we have $53 million in cash and remain debt free. Our focus is firmly on profitability while enhancing top line revenues. By adopting a more disciplined approach to operating expenditures, we are actively reducing our operating expenses.

Sandra Campos: During our Q4 earnings call in June, I outlined priorities including the consolidation of PetMeds and PetCareRx for operational efficiencies, reducing costs across both organizations, and a continued focus on maintaining a healthy liquidity position. In the second half of Q1, we initiated these efforts, resulting in approximately $5 million in annualized cost savings, which we will realize over the coming months. Our balance sheet remains strong, and as of the beginning of August, we have $53 million in cash and remain debt-free.

Speaker Change: During our Q4 earnings call in June I outlined priorities, including the consolidation of pet meds and pet care Rx for operational efficiencies.

Speaker Change: Do you think costs across both organizations and a continued focus on maintaining a healthy liquidity position.

Speaker Change: In the second half of Q1, we initiated these efforts, resulting in approximately $5 million in annualized cost savings, which we will realize over the coming months.

Speaker Change: Our balance sheet remains strong and as of the beginning of August we have $53 million in cash and remain debt free.

Sandra Campos: Our focus is firmly on profitability while enhancing top-line revenue. By adopting a more disciplined approach to operating expenditures, we are actively reducing our operating expenses. Customer Retention Initiatives were a priority in June and July, while driving processes and technology improvements and positively influencing our customer experience were top of mind. We will be launching our new acquisition marketing campaigns in August, and we believe that these, in combination with the other strategic actions that we're taking, will position us to accelerate sales growth and further enhance our profitability.

Speaker Change: Our focus is firmly on profitability, while enhancing top line revenues by adopting a more disciplined approach to operating expenditure we are actively reducing our operating expenses.

Sandra Campos: Customer retention initiatives were a priority in June and July, while driving processes and technology improvements and positively influencing our customer experience work top of mind.

Speaker Change: Customer retention initiatives, where our priority in June and July while driving processes and technology improvements and positively influencing our customer experience were top of mind.

Sandra Campos: We will be launching our new acquisition marketing campaigns in August, and we believe that these, in combination with the other strategic actions that we're taking, will position us to accelerate sales growth and further enhance our profitability. Delivering high quality customer interactions at every touchpoint is crucial to our success as a retailer. To achieve this, we're investing in advanced technology-driven marketing solutions designed to enhance every aspect of our customer experience. Our efforts are focused on ensuring that each interaction is seamless, personalized, and engaging, reflecting our commitment to excellence and customer service. I've partnered directly with our frontline customer success teams to gather invaluable feedback from our customers and users, and I've been deeply involved in understanding our customer experience this firsthand.

Speaker Change: We will be launching our new acquisition marketing campaigns in August and we believe that these in combination with the other strategic actions that we're taking will position us to accelerate sales growth and further enhance our profitability.

Sandra Campos: Delivering high-quality customer interaction at every touchpoint is crucial to our success as a retailer. To achieve this, we're investing in advanced technology-driven marketing solutions designed to enhance every aspect of our customer experience. Our efforts are focused on ensuring that each interaction is seamless, personalized, and engaging, reflecting our commitment to excellence in customer service. I've partnered directly with our frontline customer success teams to gather invaluable feedback from our customers and users, and I've been deeply involved in understanding our customer experiences firsthand.

Speaker Change: Delivering high quality customer interactions at every touch point is crucial to our success as a retailer to achieve this we're investing in advanced technology, driven marketing solutions designed to enhance every aspect of our customer experience.

Speaker Change: Our efforts are focused on ensuring that each interaction is seamless.

Speaker Change: Personally engaging reflecting our commitment to excellence in customer service.

Speaker Change: Ive partner directly with our frontline customer success teams to gather invaluable feedback from our customers and users and I've been deeply involved in understanding our customer experiences firsthand.

Sandra Campos: This quarter, I spoke directly with valued customers like Michelle and Mike, who told me that they have been loyal patrons for more than five years. Mike highlighted his appreciation for the prescription approval process, and Michelle expressed her dark harbors joy at receiving the surprise treats and every auto shift delivery. Many of our loyal customers have expressed the strong connection that they have with our brand.

Sandra Campos: This quarter, I spoke directly with valued customers like Michelle and Mike, who told me that they have been loyal patrons for more than five years. Mike highlighted his appreciation for our prescription approval process, and Michelle expressed her dog Harper's joy at receiving the surprise treats in every auto ship delivery.

Speaker Change: This quarter I spoke directly with valued customers like Michel and Mike who told me that they have been loyal patrons for more than five years.

Speaker Change: Mike highlighted his appreciation for our prescription approval process and Michelle expressed her dark Harper's joy at receiving the surprise treats and every auto ship deliberate.

Sandra Campos: Many of our loyal customers have expressed a strong connection that they have with our brand. However, our recent technology disruptions have also provided us with valuable insights into some less positive customer experiences, and I spoke directly with several of those customers as well. We have sprung into action and are actively addressing both the immediate problems and their underlying causes, including issues with order tracking and delivery, delays in our order management system, and challenges with self-service, such as making changes to orders. Our focus is on implementing solutions that resolve these issues quickly, while also preventing their recurrence in the future. This disruption in the customer experience underscores a vital takeaway.

Speaker Change: Many of our loyal customers have expressed a strong connection that they have with our brands. However, our recent technology disruptions have also provided us with valuable insights into some less positive customer experiences and I spoke directly with several of those customers as well.

Sandra Campos: However, our recent technology disruptions have also provided us with valuable insights into some less positive customer experiences, and I spoke directly with several of those customers as well. We have sprung into action and are actively addressing both the immediate problems and their underlying causes, including issues with order tracking and delivery delays in our order management system and challenges with self service, such as making changes to orders. Our focus is on implementing solutions that resolve these issues swiftly, while also preventing their recurrence in the future. This disruption in the customer experience underscores a vital takeaway, while our brand equity, which has been built over 28 years, continues to resonate powerfully with our loyal customers.

Speaker Change: We have sprung into action and are actively addressing both the immediate problems and their underlying causes including issues with order tracking and delivery delays in our order management system and challenges with self service such as making changes to orders. Our focus is on implementing solutions that resolved. These issues swiftly while also preventing there.

Speaker Change: Recurrence in the future.

Speaker Change: This disruption in the customer experience underscores a vital takeaway, while our brand equity which has been built over 28 years continues to resonate powerfully with our loyal customers. We must elevate every interaction for every customer.

Sandra Campos: While our brand equity, which has been built over 28 years, continues to resonate powerfully with our loyal customers, we must elevate every interaction for every customer. As I mentioned, we have already begun modernizing our technology for a more streamlined and efficient experience, and we are accelerating our delivery process to ensure more timely service. These efforts will both enhance our operational effectiveness and reinforce the trust our customers place in us. In the past five weeks, we have achieved several important strategic milestones. We launched 350 SKUs of Hill's and Royal Canin RX Food, an initiative that had been in the works for many months, and enhanced our competitive position by expanding our prescription food offering.

Sandra Campos: We must elevate every interaction for every customer. customer. As I mentioned, we have already begun modernizing our technology for a more streamlined and efficient experience, and we are accelerating our delivery process to ensure more timely service. These efforts will both enhance our operational effectiveness and reinforce the trust our customers place in us.

Speaker Change: As I mentioned, we have already begun modernizing our technology for more streamlined and efficient experience and we are accelerating our delivery process to ensure more timely service.

Speaker Change: These efforts will both enhance our operational effectiveness and reinforced the trust our customers place in us.

Sandra Campos: In the past five weeks, we have achieved several important and strategic milestones. We launched 350 skews of Hills and Royal Canin RX food, an initiative that was in the works for many months, and enhanced our competitive position by expanding our prescription food offering. This launch also included a complimentary telehealth visit through a strategic partner, Vetster, which has also seen incremental growth this quarter. Secondly, we are developing strategic partnerships to enhance our ecosystem, recently cementing a partnership with a rapidly growing pet wellness and grooming franchise, as well groomed, whose mission aligns with ours in providing comprehensive and affordable pet wellness solutions.

Sandra Campos: This launch also included a complimentary telehealth visit through our strategic partner, Vetster, which has also seen incremental growth this quarter. Secondly, we're developing strategic partnerships to enhance our ecosystem, recently cementing a partnership with a rapidly growing pet wellness and grooming franchise, Well Groomed, whose mission aligns with ours in providing comprehensive and affordable pet wellness solutions. We will be integrating grooming and wellness services with our product offerings, and the Petmed and PetcareRx products will be integrated into their company's wellness recommendation engine.

Speaker Change: In the past five weeks, we have achieved several important strategic milestone.

Speaker Change: We launched 350 Skus of hills, and Royal Canin, Rx food and an initiative that was in the works for many months and enhanced our competitive competitive position by expanding our prescription food offering.

Speaker Change: This launch also included a complementary telehealth visits through our strategic partner Fetzer, which has also seen incremental growth this quarter.

Speaker Change: Secondly, we're developing strategic partnerships to enhance our ecosystem recently cementing a partnership with a rapidly growing pet wellness and grooming franchises, well groomed, whose mission aligns with ours and providing comprehensive and affordable pet wellness solution.

Sandra Campos: We will be integrating grooming and wellness services with our product offerings, and the pet meds and pet care RX products will be integrated into their company's wellness recommendation engine. This partnership will broaden our brand equity as we continue to meet the customers where they are. It's equally important to reiterate that our efforts to consolidate brands and streamline operations are well underway, and the steps we've taken have reduced our operating expenses, as I mentioned, by approximately $5 million on an annualized run rate basis, some of which will be re-invested into growth initiatives. First, from an operations perspective, we've consolidated our buying IT digital and marketing teams into a single unified team across both organizations.

Sandra Campos: This partnership will broaden our brand equity as we continue to meet customers where they are. It's equally important to reiterate that our efforts to consolidate brands and streamline operations are well underway. And the steps we've taken have reduced our operating expenses, as I mentioned, by approximately $5 million on an annualized run rate basis, some of which will be reinvested into growth initiatives. First, from an operations perspective, we've consolidated our buying, IT, digital, and marketing teams into a single unified team across both organizations.

Sandra Campos: Second, our fulfillment centers and pharmacies in New York and Florida will operate independently while ensuring that our people processes and technologies are standardized across those locations, thus improving the speed of prescription authorization and the speed of delivery of orders to our customers. Third and notably, as of July 15th, we have modernized our legacy call center system to a state-of-the-art call center technology with an effort to support customer service.

Sandra Campos: Second, our fulfillment centers and pharmacies in New York and Florida will operate independently while ensuring that our people, processes, and technologies are standardized across those locations, thus improving the speed of prescription authorizations and the speed of delivery of orders to our customers.

Sandra Campos: Third, and notably, as of July 15th, we have modernized our legacy call center system to a state-of-the-art call center technology in an effort to support customer service. From a technology perspective, we're concentrating on several key areas to drive both immediate and long-term improvements. For instance, we're accelerating the provider authorization process through our veterinary portal to enable faster Rx approvals while also increasing the speed of order delivery to our customers' homes. This includes increasing the number of pharmacy technicians to expedite approval rates and streamlining the connection between veterinary clinics and our pharmacy to reduce friction.

Speaker Change: Call Center technology with an effort to support customer service.

Sandra Campos: From a technology perspective, we're concentrating on several key areas to drive both immediate and long-term improvements. For instance, we're accelerating the provider authorization process through our veterinary portal to enable faster RX approvals, while also increasing the speed of order delivery to our customer homes. This includes increasing the number of pharmacy technicians to expedite approval rates and streamlining the connection between variant veterinary clinics and our pharmacy to reduce the friction. Over the past three weeks alone, our pharmacy teams have reduced Q times by 36% and are now processing our orders with greater efficiency.

Speaker Change: From a technology perspective, we're concentrating on several key areas to drive both immediate and long term improvements for instance, we're accelerating the provider authorization process through our veterinary portal to enable faster Rx approval, while also increasing the speed of order delivery to our customers homes.

Speaker Change: This includes increasing the number of pharmacy technicians to expedite approval rates and streamlining the connection between bare to veterinary clinics in our pharmacy to reduce the friction.

Sandra Campos: Over the past three weeks alone, our pharmacy teams have reduced queue time by 36% and are now processing our orders with greater efficiency. We are just beginning to tap into the long-term potential of PetMeds and PetCareRx. This is underscored by the work that we've done over the past few months. Our annual revenues currently represent only a fraction of the U.S. pet market, which grew 7% in 2023 and has exceeded $150 billion annually, with a significant portion driven by veterinary care and prescription medications.

Speaker Change: Over the past three weeks alone our pharmacy teams have reduced Q times by 36% and are now processing, our orders with greater efficiency.

Sandra Campos: We are just beginning to tap into the long-term potential of pet meds and pet care RX. This is underscored by the work that we've done over the past few months. Our annual revenues currently represent only a fraction of the US pet market, which grew 7% in 2023 and has exceeded $150 billion annually, with a significant proportion driven by veterinary care and prescription medication. We aim to ensure sustained growth and a thriving customer community with disciplined execution of our broad roadmap. We are confident that these strategic initiatives that we are diligently implementing across all departments will drive growth, enhance profitability, and will boost key customer satisfaction metrics.

Speaker Change: We are just beginning to tap into the long term potential of pet meds and pet care Rx. This is underscored by the work that we've done over the past few months. Our annual revenues currently represent only a fraction of the U S pet market, which grew 7% in 2023 and has exceeded $150 billion annually with a significant.

Speaker Change: Tim portion driven by veterinary care and prescription medications, we aimed to ensure sustained growth and a thriving customer community with disciplined execution of our broad roadmap. We are confident that these strategic initiatives that we are diligently implementing across all departments will drive growth enhance profitability and.

Sandra Campos: We aim to ensure sustained growth and a thriving customer community with the disciplined execution of our broad roadmap. We are confident that these strategic initiatives that we are diligently implementing across all departments will drive growth, enhance profitability, and boost key customer satisfaction metrics. With that, I will hand the call to Christine so that she can cover the first quarter results in more detail.

Speaker Change: We will boost key customer satisfaction metrics.

Christine Chambers: With that, let me hand the call to Christine so that she can cover the first quarter results in more detail. Thank you, Sandra. I'll now provide an update on the first quarter fiscal year 2025 results for the quarter ending June 30th, 2024. We welcomed approximately 75,000 new customers this quarter, a decrease from approximately 86,000 new customers in the same period last year. Rose profit margin was 26.4% compared to 28.8% in the same quarter last year and 27.3% in the fourth quarter. The decrease year of a year was primarily due to the higher promotional activity in the most recent quarter as customers used discounts more frequently.

Speaker Change: With that let me hand, the call to Christine so that she can cover the first quarter results in more detail.

Christine Chambers: I'll now provide an update on the first quarter fiscal year 2025 results for the quarter ending June 30th, 2024. Sales were $68 billion compared to $78.2 million in the same period last year, a 13% decline driven by lower prescription medication sales. We welcomed approximately 75,000 new customers this quarter, a decrease from approximately 86,000 new customers in the same period last year. Gross profit margin was 26.4% compared to 28.8% in the same quarter last year and 27.3% in the fourth quarter.

Christine Chambers: The decrease year over year was primarily due to higher promotional activity in the most recent quarter, as customers used discounts more frequently. Adjusted EBITDA reflected a loss of $1.5 million compared to adjusted EBITDA of $3.1 million for the same period last year. The decrease was driven by lower gross profit. Net income for the first quarter was $3.8 million, or $0.18 per diluted share, compared to a net loss of $1.1 million, or $0.06 per diluted share, for the same period last year.

Christine Chambers: Adjusted EBITDA reflected a loss of 1.5 million compared to adjusted EBITDA of 3.1 million for the same period last year. The decrease was driven by lower gross profit. Met income for the first quarter was 3.8 million, or 18 cents per day to share, compared to a loss of 1.1 million, or 6 cents per day to share, for the same period last year. The change year of a year was primarily due to lower gross profit of 4.6 million, offset by a year of a year decrease in stock compensation expense of $10 million related to the recapture of expense from the departure of the previous CEO and other executives.

Christine Chambers: The change year-over-year was primarily due to lower gross profit of $4.6 million offset by a year-over-year decrease in stock compensation expense of $10 million related to the recapture of expenses from the departure of the previous CEO and other executives. Turning to the balance sheet, as of June 30th, 2024, we had 46 million in cash and equivalents and no debt. As Sandra mentioned, early in August, we have $53 million of... We would now like to open the call to questions, and after that, Sandra will provide some concluding remarks.

Christine Chambers: Turning to the balance sheet, as of June 30, 2024, we had 46 million of cash and equivalents and no debt. As Sandra mentioned early in August, we have $53 million of cash.

Christine: Instead. He is 2024, we had 40 $46 million of cash and equivalents and no debt.

Christine: Ah Sandra mentioned early in August we have $53 million of cash.

Operator: We would like now to open the call for questions, and after that, Sandra will provide some concluding remarks. Operators? We will now begin the question and answer session. To ask a question, you may press star, then one on your telephone keypad. If you are using a speaker phone, please pick up your handset before pressing the key. To withdraw your question, please press star, then two.

Speaker Change: We would like now like to open the call for questions. After that Sandra will provide some concluding remarks.

Speaker Change: Operator.

Operator: We will now begin the question and answer session. To ask a question, you may press star, then one on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the key. To withdraw your question, please press star, then Q. At this time, we will pause momentarily to assemble the roster, and our first question will come from Ryan Meyers of Lake Street Capital Markets. Please go ahead.

Speaker Change: We will now begin the question and answer session.

Speaker Change: To ask a question you May press Star then one on your telephone keypad.

Speaker Change: If you are using a speakerphone please pick up your handset before pressing the key.

Speaker Change: To withdraw your question. Please press Star then two.

Operator: At this time, we will pause momentarily to assemble the roster.

Speaker Change: At this time, we will pause momentarily to assemble the roster.

Ryan Meyers: Our first question will come from Ryan Myers of Lake Street Capital Market. Please go ahead. Hi guys, thanks for taking my questions.

Speaker Change: And our first question will come from Ryan Meyers of Lake Street capital markets.

Speaker Change: Please go ahead.

Ryan Meyers: Hey guys, thanks for taking my questions. First one for me, you know. I'm just wondering if you can provide a little bit more detail on some of the macro pressures that you guys saw during the quarter that kind of ultimately drove the 13% revenue decline and then maybe, you know, your level of confidence in being able to drive growth back into the business despite any macro pressures that the business might be seeing out there.

Ryan Meyers: Hey, guys. Thanks for taking my questions first one for me just wondering if you can provide a little bit more detail on some of the macro pressures that you guys saw during the quarter that can ultimately drove the 13% revenue decline and then maybe.

Sandra Campos: First one for me, you know, I'm just wondering if you can provide a little bit more detail on some of the macro pressures that you guys saw during the quarter that kind of ultimately drove the 13% revenue decline and then maybe, you know, your level of confidence of being able to drive growth back into the business despite any macro pressures. That the business might be seeing out there.

Speaker Change: Your level of confidence of being able to drive growth back into the business. Despite any macro pressures that the business might be seeing out there.

Sandra Campos: I'll take that, Ryan.

Sandra Campos: I'll take that, Ryan. So first, as relates to macro pressures, there are fewer pet owners going to the veterinary clinics on a less frequent basis, therefore getting less prescriptions and lower prescriptions than they had in the past. That's one macro issue. We're seeing definite pressure on consumers as it relates to their spend. And they're just even listening to the customer calls that I've been on for multiple days.

Sandra Campos: So first is related to macro pressures. There are fewer; the pet owners are going to the veterinary clinics on a less frequent basis, therefore getting less prescriptions and lower prescriptions than they have in the past. That's one macro issue. We're seeing definite pressure with the consumers as it relates to their spend, and they're just even listening to the customer calls that I've been on for multiple days. I've heard an increased request for promotion, coupons, and other factors that would actually decrease their price on a product. Those are definitely macro issues that are affecting the spend, both even though our auto ship is at 56% of our total business.

Sandra Campos: I've heard an increased request for promotion, coupons, and other factors that would actually decrease their price on a product. Those are definitely macro issues that are affecting the spend, both even though our auto ship is at 56% of our total business, it's definitely affecting what the customers are thinking and how they're thinking about percent for their animals as well as themselves. As it relates to how confident we feel, again, one of the things that I mentioned is that we are barely scratching the surface at this point in terms of this very large $150 billion sector in this industry.

Sandra Campos: It's definitely affecting what the customers are thinking and how they're thinking about their spend for their animals as well as themselves.

Sandra Campos: As it relates to how confident we feel, again, one of the things that I mentioned is that we are barely scratching a surface at this point in terms of this very large $150 billion sector in this industry. And we are, we know who the total dress will mark this. We know who our customers are, and we are very confident in the way that we're actually going about now, segmenting these customers and being able to truly create a more engaging and seamless experience for them. So a lot of the technology, a lot of the marketing strategies, a lot of the customer service that we are delivering and changing to be able to deliver more seamless, frictionless, and speedier deliveries to the customers.

Sandra Campos: And we know who the total addressable market is, we know who our customers are, and we are very confident in the way that we're actually going about now segmenting these customers and being able to truly create a more engaging and seamless experience for them. So a lot of the technology, a lot of the marketing strategies, a lot of the customer service that we're delivering and changing to be able to deliver more seamless, frictionless, and speedier deliveries to the customers, those we feel very strongly are going to attract more customers, and not only new customers, but also going to continue to increase the frequency of the customers that we do have currently.

Sandra Campos: Those we feel very strongly are going to capture more customers and not only new customers, but going to continue to increase the frequency of the customers that we do have currently.

Speaker Change: We are going to capture more customers and not only new customers, but going to continue to increase the frequency of the customers that we do have currently.

Sandra Campos: Got it. And then if we think about, you know, you said a little bit of stabilization toward the end of the quarter and then I would presume here in the Q2. So, you know, maybe how should we think about the revenue, if not growth, or kind of slowing decline throughout the rest of the year, given you guys have seen some sort of stabilization? Yeah, we're seeing the stabilization from revenues, this conversion rate, as well as the margins. So the margins have been improving as well, month over month, so we've seen a consistent uptick from April, May, June to July.

Sandra Campos: Got it. And then if we think about, you know, you said a little bit of stabilization towards the end of the quarter and then I would presume here into Q2. So, you know, maybe how should we think about revenue, if not growth, or kind of slowing decline throughout the rest of this year, given you guys have seen some sort of stabilization?

Speaker Change: Got it and then if we think about you said a little bit of stabilization towards the end of the quarter and then I would presume here into Q2 so.

Speaker Change: Maybe how should we think about the revenue if not growth or kind of slowly decline throughout the rest of this year.

Speaker Change: Given you guys have seen some sort of stabilization.

Sandra Campos: Yeah, we're seeing stabilization in revenues, business conversion rates, as well as margins. So the margins have been improving as well, month over month. So we've seen a consistent uptick from April, May, June to July on the gross margin part. So that's actually a very positive improvement as well. On the sales piece, we're seeing a week over week improvement. So our conversion rate is continuing to stay pretty consistent and also stabilize, which is an important factor.

Speaker Change: Yeah, well, we're seeing the stabilization from revenues.

Speaker Change: Its conversion rate as well as the margins. So the margins have been improving as well month over month. So we've seen a consistent uptick from April may June to July.

Sandra Campos: The growth margin part, so that's actually a very positive improvement as well. On the sales piece, we're seeing a week-of-a-week continuation to improve, so our conversion rate is continuing to stay pretty consistent and also stabilize, which is an important factor. And on the metric that I mentioned before, changing from a new customer standpoint, as we look at our unique customers and unique transactions over the past two months, they've also continued to increase.

Speaker Change: The gross margin part so that's actually a very positive improvement as well.

Speaker Change: On the sales piece, we're seeing a week over week continuation to improve so our conversion rate is continuing to stay pretty consistent and also stabilized.

Sandra Campos: And on the metric that I mentioned before changing from a new customer standpoint, as we look at our unique customers and unique transactions over the past two months, they've also continued to increase. Okay, that's helpful then.

Speaker Change: Which is an important factor and on the metric that I mentioned before changing from a new customer standpoint, as we look at our unique customers and unique transactions over the past few months, Dave also continued to increase.

Sandra Campos: Okay, that's helpful, then. It's also increased versus last year, as well.

Speaker Change: Alright, that's helpful. And then also increased versus last year as well.

Sandra Campos: Okay, got it. And then last question for me, you know, you called out some technology issues that drove a little bit of a softness during the quarter. I was just wondering if you could provide a little bit more detail around what those technology problems were.

Sandra Campos: Okay, got it. And then last question for me, you know, you called out some technology issues that drove a little bit of the software in the corridor. Just wondering if you can provide a little bit more detail around what those technology problems were. We previously mentioned that we had implemented a new order management system earlier in this year, January to February, and with that we had some disruptions that started that raised some initial challenges with the customers in that it is actually having longer hold and wait times for our customer call center as well as our pharmacy that was taking place at the end of the fiscal year going into Q1 of this fiscal year.

Speaker Change: Okay got it and then.

Sandra Campos: We previously mentioned that we implemented a new order management system earlier in this year, January to February. And with that, we had some disruptions that started that raised some initial challenges with the customers and that ended up actually having longer hold and wait times for our customer call center as well as our pharmacy. That was taking place at the end of the fiscal year going into Q1 of this fiscal year.

Sandra Campos: So April, May, we were seeing those starting to be reduced a bit, but they were pretty significant hold times and wait times. And of course, as we're getting veterinary clinics calling in for pharmacy prescription approvals, that was also impacting them as well. But we've already been addressing them. We started to address it already. We've improved these greatly. Our call times are back down, and the handle times are actually back down to a very, very normal rate at this point.

Sandra Campos: So April, May we were seeing those starting to be reduced a bit, but they were pretty significant hold times and wait times, and of course we're getting veterinary clinics calling in for pharmacy prescription approvals that was also impacting them as well.

Sandra Campos: But we've already been addressing them; we've started to address it already. We've improved these greatly; our call times are back down to handle times. We're actually back down to a very, very normal rate at this point. And we've also, with the call center technology that I mentioned, been able to improve the time that and the ability for our veterinary clinic partners to be able to contact our pharmacy and have those prescriptions approved as well on a more timely basis. So these things that we have seen as it relates to wait times, hold times, our order management system that was impacting some self-service for our customer's accounts on authorship.

Sandra Campos: And we've also, with the call center technology that I mentioned, been able to improve the time and the ability for our veterinary clinic partners to be able to contact our pharmacy and have those prescriptions approved as well on a more timely basis. So these things that we have seen as it relates to wait times, hold times, our order management system that was impacting some self-service for customers' accounts on AutoShip, those have been addressed and are being addressed.

Sandra Campos: Those have been addressed and are being addressed, and we're continuing to look deeply and dive a little bit deeper in terms of each and every area that a customer experiences so that we can improve upon those.

Sandra Campos: And we're continuing to look deeply and dive a little bit deeper in terms of each and every area that a customer experiences so that we can improve upon those. Got it. Thank you for taking my question.

Ryan Meyers: Got it. Thank you for taking my questions.

Operator: Thank you.

Sandra Campos: This concludes our question and answer session.

Operator: This concludes our question and answer session. I would like to turn the call back over to Sandra Campos for any closing remarks.

Sandra Campos: I would like to turn the call back over to Sandra Campos for any closing remarks. Well, thank you for your time and interest in pet meds and pet care RX. We greatly appreciate your support, although we're still in the early stages of our transformation. As I mentioned, we are already making steady progress on many of the key initiatives discussed today that will drive growth and improve profitability.

Sandra Campos: Well, thank you for your time and interest in PetMeds and PetCareRx. We greatly appreciate your support. Although we're still in the early stages of our transformation, as I mentioned, we are already making steady progress on many of the key initiatives discussed today that will drive growth and improve profitability. I want to thank all of our employees for their commitment and dedication to our pet families, their ongoing passion for our business, and their understanding and rapid execution of our new priorities.

Speaker Change: We are already making steady progress on many of the key initiatives discussed today that will drive growth and improve profitability I want to thank all of our employees for their commitment and dedication to our pet families.

Sandra Campos: I want to thank all of our employees for their commitment and dedication to our pet families, their ongoing passion for our business, and their understanding and rapid execution of our new priorities. We look forward to updating you on our progress during our next conference call, and we will also be attending a number of investor events during the back half of this year and look forward to seeing you there. Thank you.

Speaker Change: They're ongoing passion for our business and their understanding and rapid execution of our new priorities. We look forward to updating you on our progress during our next conference call and we will also be attending a number of investor events. During the back half of this year and look forward to seeing you there. Thank you.

Sandra Campos: We look forward to updating you on our progress during our next conference call, and we will also be attending a number of investor events during the back half of this year and look forward to seeing you there. Thank you. The conference has now concluded. Thank you for attending today's presentation, and you may now disconnect.

Operator: The conference has now concluded.

Speaker Change: The conference has now concluded. Thank you for attending today's presentation and you may now disconnect.

Operator: Thank you for attending today's presentation, and you may ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶

Speaker Change: Yeah.

Speaker Change: [music].

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