Q2 2024 W&T Offshore Inc Earnings Call
Speaker Change: Ladies and gentlemen, thank you for standing by.
Operator: or a second quarter, 2024 conference call. During today's call, all parties will be in a listen-only mode. Following the company's prepared comments, the call will be open for questions and answers.
Operator: 2nd quarter 2024 conference call. During today's call, all parties will be in a listen-only mode. Following the company's prepared comments, the call will be open to questions and answers. During the question and answer session, we ask that you limit your questions to one and a follow-up. You can always rejoin the queue. This conference is being recorded, and a replay will be made available on the company's website following the call. I would now like to turn the conference over to Al Petrie, Director of Investor Relations.
Speaker Change: Welcome to the W&T Offshore second quarter 2024 conference call.
Speaker Change: During today's call, all parties will be in a listen-only mode.
Speaker Change: Following the company's prepared comments, the call will be open for questions and answers.
Operator: Here in the question and answer session, we ask the two limiters questions to one and a follow-up. You can always rejoin the queue.
Speaker Change: During the question and answer session, we ask that you limit your questions to one and a follow-up. Thank you. Thank you.
Operator: This conference is being recorded, and a replay will be made available on the company's website following the call.
Speaker Change: You can always rejoin the queue.
Speaker Change: This conference is being recorded and a replay will be made available on the company's website following the call.
Al Petrie: I would now like to turn the cops into Al Petrie, Investor Relations Coordinator.
Speaker Change: I would now like to turn the conference over to Al Petrie, Investor Relations Coordinator.
Al Petrie: Thank you, operator.
Al Petrie: Thank you, operator. And on behalf of the management team, I'd like to welcome all of you to today's conference call to review W&T Offshore's second quarter 2024 financial and operational results. Before we begin, I would like to remind you that our comments may include forward-looking statements. It should be noted that a variety of factors could cause W&T's actual results to differ materially from the anticipated results or expectations expressed in these forward-looking statements. Thanks, Al.
Derrick Whitfield: On behalf of the management team, I'd like to welcome all of you to today's conference call to review Derrick Whitfield Offshore's second quarter, 2024 financial and operational results. Before we begin, I would like to remind you that our comments may include void-looking statements. It should be noted that a variety of factors could cause W&T's actual results to differ materially from the anticipated results or expectations expressed in these forward-looking statements. Today's call may also contain certain non-GAAP financial measures.
Al Petrie: Thank you, Operator. And on behalf of the management team, I'd like to welcome all of you to today's conference call to review W&T Offshore's second quarter 2024 financial and operational results.
Al Petrie: Before we begin, I would like to remind you that our comments may include forward-looking statements.
Al Petrie: It should be noted that a variety of factors could cause W&T's actual results to differ materially from the anticipated results or expectations expressed in these forward-looking statements.
Derrick Whitfield: Please refer to the earnings release that we issued just today for displeasures on void-looking statements and reconciliation of non-GAAP measures.
Al Petrie: Today's call may also contain certain non-GAAP financial measures. Please refer to the earnings release that we issued yesterday for disclosures on forward-looking statements and reconciliations of non-GAAP measures. With that, I'd like to turn the call over to Tracy Krohn, our Chairman and CEO .
Derrick Whitfield: With that, I'd like to turn the call over to Crazy Crone by Chairman and CEO.
Derrick Whitfield: Thanks, Al.
Tracy Krohn: Good day to everyone, and thanks for joining us on our conference call today. So with me are William Williford, our Executive Vice President and Chief Operating Officer; Sameer Parasnis, our Executive Vice President and Chief Financial Officer, and Trey Hartman, our Vice President and Chief Accounting Officer. They'll be available to answer questions later during the call.
Derrick Whitfield: Good day to everyone, and thanks for joining us on our conference call today. With me, our William Wilford, our executive vice president and chief operating officer, Samir Paulusness, our executive vice president and chief financial officer, and Trey Hartman, our vice president and chief accounting officer. They'll be available to answer questions later during the call. On the second quarter, we continue to report very solid operational financial results. Our focus on generating free cash flow while maintaining and optimizing our assets, including the assets we acquired in Q1, allows us to generate free cash flow of $18.7 million.
Tracy Krohn: Thanks, Al. Good day to everyone, and thanks for joining us on our conference call today.
Speaker Change: So, with me are William Williford, our Executive Vice President and Chief Operating Officer, Sameer Parasnis, our Executive Vice President and Chief Financial Officer, and Trey Hartman, our Vice President and Chief Accounting Officer. They'll be available to answer questions later during the call.
Tracy Krohn: So in the second quarter, we continued to report very solid operational financial results. Our focus on generating free cash flow while maintaining and optimizing our assets, including the assets we acquired in Q1, allowed us to generate free cash flow of $18.7 million. For the past six and a half years, every quarter, we've generated positive free cash flow because we operate very efficiently and know that cash is paramount to our success. Our balance sheet continues to reflect this as we deliver strong production and meaningful adjusted EBITDA. We generated a solid adjusted EBITDA of $45.9 million.
Speaker Change: So in the second quarter, we continued to report very solid operational financial results.
Speaker Change: Our focus on generating free cash flow while maintaining and optimizing our assets, including the assets we acquired in Q1, allow us to generate free cash flow of $18.7 million.
Derrick Whitfield: For the past six and a half years, every year, we've generated positive free cash flow because we operate very efficiently and know that cash is paramount to our success. Our balance sheet continues to reflect this so that we deliver strong production and meaningful adjusted EBITDA.
Speaker Change: For the past six and a half years, every quarter, we've generated positive free cash flow because we operate very efficiently and know that cash is paramount to our success.
Speaker Change: Our balance sheet continues to reflect this as we deliver strong production and meaningful adjusted EBITDA.
Derrick Whitfield: On the second quarter, we had a number of accomplishments that demonstrated how successfully we are doing on our strategy. First, we reported production of 34,900 barrels over the equivalent per day, so at the midpoint of our guidance range and virtually flat Q1. Next, we generated solid adjusted EBITDA of $45.9 million. We remained focused on cost control with the absorption of recent acquisitions; thus, in the second quarter, we recorded lease operating expenses below the lower end of our guidance. So we continued to realize synergies from our January 20, 2024 property acquisition and deferred some workovers and facilities maintenance expenses as well.
Speaker Change: So in the second quarter, we had a number of accomplishments that demonstrated how successfully we are doing on our strategy. First, we reported production of 34,900 barrels of oil equivalent per day, so at the midpoint of our guidance range, and virtually flapped Q1.
Speaker Change: next
Speaker Change: We generated a solid adjusted EBITDA of $45.9 million.
Speaker Change: We remain focused on cost control with the absorption of recent acquisitions. Thus, in the second quarter, we recorded lease operating expenses below the lower end of our guidance.
Speaker Change: So, we continue to realize synergies from our January 2024 property acquisition and deferred some work overs and facilities maintenance expenses as well.
Derrick Whitfield: Also, we generated strong free cash flow, allowing us to increase our cash and cash requirements at the end of the second quarter by 30 percent, over $123 million, and decreased our net debt by 9 percent to 16.5 million. and those. We continued returning cash to our shareholders, paying our third consecutive quarterly dividend, and announced the third quarter of 2024 payment will occur later this month. Last, we saw meaningful increases in our mid-year SEC-approved reserve support generated by our Netherlands' civil associates. Prood reserves increased 15% to 141.9 million barrels of oil equipment, and the PV-10 of those reserves increased 28% to 1.4 billion dollars.
Speaker Change: Also, we generated strong pre-cash flow allowing us to increase our cash and cash equivalents at the end of the second quarter by 30% to over $123 million and decreased our net debt by 9% to $268.5 million.
Speaker Change: We continued returning cash to our shareholders, paying our third consecutive quarterly dividend and announced the third quarter 2024 payment will occur later this month.
Speaker Change: Last, we saw meaningful increases in our mid-year SEC approved reserves report generated by Netherland Sewer Associates.
Speaker Change: Prudent reserves increased 15% to 141.9 million barrels of oil equivalent, and the PV10 of those reserves increased 28% to $1.4 billion.
Derrick Whitfield: So this is evidence of our ability to execute operationally, and this continues to help us build cash, reduce net debt, and further strengthen our balance sheet. We're at a very good financial position midway through 2024, and we remain focused on operational execution to build on these solid results.
Derrick Whitfield: So, with over 40 years of experience integrating acquisitions in our asset base, we've proven that incurring near-term costs are well worth it to realize the long-term potential of newly acquired assets that continue to generate cash to enforce for many years to come. Regarding the cost asset acquisition, we contingent make good progress integrating these new assets in the W&T. During the second quarter, we successfully negotiated a new beneficial agreement with a gas processor at Mobile Reel Bay 916 and returned the field to production on May 27th at our rates consistent with expectations. With the return of that field production, four of the six Cox fields recently acquired are now on production.
Tracy Krohn: We've proven that incurring near-term costs is well worth it to realize the long-term potential of newly acquired assets that continue to generate cash flow for us for many years to come. Regarding the Cox asset acquisition, we've continued to make good progress integrating these new assets into W&T. During the second quarter, we successfully negotiated a near-beneficial agreement with a gas processor at Mobile Bay 916 and returned the field to production on May 27th at rates consistent with expectations.
Tracy Krohn: With the return of that field to production, four of the six Cox fields recently acquired are now in production. For the two remaining shut-in fields, we continue to work parallel paths on each to expedite their return to production, either through existing sales routes or alternative sales routes.
Derrick Whitfield: With the two remaining shut-in fields, we continue to work parallel paths on each textbook at their return to production either through existing sales routes or alternative sales routes. We believe this short-term delay is necessary to shore up a longer-term viability of these fields. So, in addition to the production boost from these new assets during the second quarter of 2024, we've performed three workovers and two recompletions that positively impact the production of the core. We were able to maintain production virtually flat with Q1-2024 while only spending $8.8 million in capital expenditures. These type of operations are a day regur for us and help offset our normal decline.
Speaker Change: We were able to maintain production virtually flat with Q1 2024 while only spending $8.8 million in capital expenditures.
Derrick Whitfield: So, in our earnings release, we provided our third quarter guidance and updated our four-year 2024 expectations. We're projecting third quarter production to be around 32,900 barrels oil per day, which reflects the impact of third-party pipeline issues due to the cost bankruptcy. So for the four-year 2024, we adjust our guidance to take into account these third quarter matters, as well as the delays we've experienced in restoring production and a couple of the cost fields required in January. We do plan to spend more on lease operating expenses in the third quarter, as we undertake some of the projects deferred earlier in the year.
Derrick Whitfield: However, we lowered our full-year estimated total lease operating expense to a range of $280 million to $315 million. It's a reduction of about 5% at the midpoint to take into account our ability to lower cost and the benefit of synergies from recent acquisitions. We have other operations in the area. For CAPEX, we continue to expect to invest $35 to $45 million in 2024, excluding. We incurred about $8.8 million in the second quarter and $11.9 million year date. These expenditures are directed primarily to facilities projects on our existing fields and the new fields acquired in late 2023 and early 2024 to maximize and optimize production.
Speaker Change: We incurred about $8.8 million in the second quarter and $11.9 million year-to-date.
Speaker Change: These expenditures are directed primarily to facilities projects on our existing fields and the new fields acquired in late 2023 and early 2024 to maximize and optimize production.
Derrick Whitfield: So, in regards to acquisitions, we've invested $80.6 million so far in 2024, and we've more than replaced reserves. So to tell you about our mid-year 2024 reserve report, the mid-year 2024 reported SEC approved reserves of 141.9 million barrels of oil equivalent, which included 21.8 million barrels oil equivalent in acquisition editions and 3.5 million barrels oil equivalent of positive performance provisions. Parasnis offset by production of $6.3 million barrels Oil Equivalent in the first half of 2024. The 21.8 million barrels oil equivalent to the acquisition is about 17% higher than what we were anticipating when we initially announced the transaction.
Tracy Krohn: So, before I close the call, I would like to tell you about our Mid-Year 2024 Reserve Report. For Mid-Year 2024, we reported SEC-approved reserves of 141.9 million barrels of oil equivalent, which included 21.8 million barrels of oil equivalent in acquisition editions and 3.5 million barrels of oil equivalent of positive performance revisions, partially offset by production of 6.3 million barrels of oil equivalent in the first half of 2024. As you can see, we believe there is tremendous potential in these new assets. We're also pleased with this mid-year report, which again has positive performance revisions. So, deja vu all over again.
Speaker Change: So, before I close the call, I would like to tell you about our Mid-Year 2024 Reserve Report.
Speaker Change: Equivalent, which included 21.8 million barrels of oil equivalent in Acquisition Editions.
Speaker Change: and 3.5 million barrels of oil equivalent of positive performance revisions, partially offset by production of 6.3 million barrels of oil equivalent in the first half of 2024.
Derrick Whitfield: As you can see, we believe there is tremendous potential in these new assets. We're also pleased with this mid-year report again that has positive performance provisions. So they shall be all over again. So approximately 47% of mid-year 2024 SEC approved reserves for liquids, with 38% crude oil and 9% NGLs, we had 53% natural gas. The increase in liquids percentage was largely due to the acquisition as well further justifying these free-to-back resistance. Reserves will classify as 54% approved developed producing, 29% approved developed non-producing, and 17% approved undeveloped. The pre-tax PV-10 of the mid-year 2024 reserves using SEC pricing was $1.4 billion.
Speaker Change: As you can see, we believe there is tremendous potential in these new assets. We're also pleased with this mid-year report again that has positive performance revisions. So, deja vu all over again.
Speaker Change: So approximately 47% of mid-year 2024 SEC approved reserves were liquids, with 38% crude oil and 9% NGLs, and we had 53% natural gas. The increase in liquids percentage was largely due to the acquisition as well, further justifying these freedom of acquisitions.
Tracy Krohn: Reserves were classified as 54% proved developed producing, 29% proved developed non-producing, and 17% proved undeveloped. The pre-tax PB10 of the mid-year 2024 food reserves using SEC pricing was $1.4 billion. That's an increase of 28% compared with the PB10 of $1.1 billion at year-end 2023. Nancy is the chair of our Environmental Safety and Governance Committee, which oversees our ESG efforts. Now, I'd like to sincerely thank our team at W&T as we're well positioned to add value for the remainder of 2024 and into 2025. Our strong balance sheet and robust cash position enhance our optionality to potentially require more complementary Gulf of Mexico assets that would enhance the scale of W&T.
Speaker Change: Reserves were classified as 54% approved developed producing, 29% approved developed non-producing, and 17% approved undeveloped.
Derrick Whitfield: That's an increase of 28% compared with the PV-10 of $1.1 billion at year-end 2023. Mid-year 2024 approved reserves in PV-10 were based on average SEC 12 months crude oil and natural gas prices of $79.45 per barrel and $2.32 per MMBTU. While you're in 23, prices were 78 to 21 per barrel of oil and $264.64 per MMBTU of natural gas.
Speaker Change: Mid-year 2024 approved reserves in PB10 were based on average SEC 12-month crude oil and natural gas prices of $79.45 per barrel and $2.32 per MMBTU.
Speaker Change: While year-end 2023 prices were $78.21 per barrel of oil and $2.64 per mmBtu of natural gas.
Derrick Whitfield: We believe we've built a sustainable portfolio of high-performing Gulf and Mexico assets that will continue to provide meaningful cash flow for many years.
Speaker Change: We believe we've built a sustainable portfolio of high-performing Gulf of Mexico assets that will continue to provide meaningful cash flow for many years.
Derrick Whitfield: In regards to our ongoing ESG initiatives, we have made a concerted effort in addressing shareholder concerns and improving our ESG metrics. Devintese culture success and sustainability is built on environmental stewardship, sound corporate governance, and contributing positively to our employees in the communities where we work and operate. In 2023, we added a new board member, Dr. Nancy Chang. Nancy is the chair of our Environmental Safety and Governance Committee that oversees our ESG efforts. Dr. Chang is helping us to guide our contingent's improvement and assess us in our commitment to the high standards of ESG and corporate governance.
Speaker Change: We have made a concerted effort in addressing shareholder concerns and improving our ESG metrics.
Speaker Change: Nancy is the chair of our Environmental Safety and Governance Committee that oversees our ESG efforts. Dr. Chang is helping us to to guide our contingency improvement and assist us in our commitment to the high standards of ESG and corporate governance.
Derrick Whitfield: Our ongoing commitment will be demonstrated when we issue our 2023 Sustainability Report in the next few weeks, which will highlight the continued progress we've made on our ESG initiatives. Now, I'd like to sincerely thank our team at W&T as the well-positioned ad value for the remainder of 2024 and into 2025. Our strong balance sheet and robust cash position enhances our optimality to potentially require more complimentary go-from-Mexico assets that would enhance the scale of the W&T. Acquisition for May to keep component of our success and is our ability to integrate and enhance the assets that we acquire that's allowed us to grow reserves and production over the past 40 plus years.
Speaker Change: Our ongoing commitment will be demonstrated when we issue our 2023 Sustainability Report in the next few weeks, which will highlight the continued progress we've made on our ESG initiatives.
Speaker Change: Acquisition remains a key component of our success and is our ability to integrate and enhance the assets that we acquire that's allowed us to grow reserves and production over the past 40 plus years.
Derrick Whitfield: We'll be rolling out our proposed drilling joint venture for potential investors very soon. We'll have more on that in the not-too-distant future. So, as the company's largest shareholder, I believe W&T is very well-positioned to succeed in 2024 and beyond. Our entire management team's interests are highly aligned with those of our shareholders given our 34% stake in W&T's equity, which is one of the highest of any public E&P company. We're focused on operational excellence, meeting our obligations, helping to serve our communities, and maximizing the cash flow potential of our asset base.
Speaker Change: So, as the company's largest shareholder, I believe W&T is very well positioned.
Speaker Change: to succeed in 2024 and beyond. Our entire management team's interests are highly aligned with those of our shareholders, given our 34% stake in W&T's equity, which is one of the highest of any public E&P company.
Speaker Change: We're focused on operational excellence, meeting our obligations, helping to serve our communities, and maximizing the cash flow potential of our asset base. So with that, operator, we can open the lines for questions.
Derrick Whitfield: So, without that, we can open the lines for questions. We will now begin the question and answer session. To ask a question, you may press star, then one, or telephone keypad.
Operator: To ask a question, you may press star then 1 on your telephone keypad. At this time, we will pause momentarily to assemble our roster.
Speaker Change: We will now begin the question and answer session.
Operator: If you're using a speaker phone, please pick up your hands that before pressing the key. Is that any time your question has been addressed, and you would like to withdraw your question, please press star then two.
Speaker Change: To ask a question, you may press star then 1 on your telephone keypad.
Speaker Change: If at any time your question has been addressed and you would like to withdraw your question, please press star then 2.
Operator: At this time, you will pause momentarily to send more roster.
Speaker Change: At this time, we will pause momentarily to assemble our roster.
John White: Our first question will come from John White with Roth Capital. You may not go ahead.
Speaker Change: Our first question will come from John White with Roth Capital. You may now go ahead.
Tracy Krohn: Good morning. Morning, John. Congratulations on a good quarter and getting the Cocks acquisition further integrated. You addressed my question during your prepared remarks, but I just want to make sure I'm not missing anything while you've adjusted production and LOE guidance. There's no change to CAPEX or asset retirement obligations, correct? That is correct, yeah. We've still got a little bit to best for the rest of the year. Okay, and on the drilling joint venture, good to hear progress on that. Will that be composed of industry partners and institutional investors? Yes. The point is we haven't completely vetted all the wells, and we want to drill in the exact timing on it.
John White: You addressed my question during your prepared remarks, but I just want to make sure I'm not missing anything While you've adjusted production and LOE guidance
Speaker Change: There's no change to CapEx or asset retirement obligations, correct?
William Williford: We've still got a little bit to invest for the rest of the year.
Speaker Change: That is correct, yeah.
Speaker Change: We've still got a little bit to invest for the rest of the year.
Speaker Change: We haven't completely bedded all the wells that we want to drill and the exact timing on it. We're still hunting rigs and timing on lifting equipment and what not that will move a platform rig around. We're rolling out...
Tracy Krohn: We're still hunting rigs and timing on lifting equipment and whatnot that will move platform rig around. We're rolling out this joint venture for not just industry partners, but also financial investors as well. As you know, we've done this in the past. Looks like six or seven wells for sure, and I'll be able to give you more information on that dollar amount of expected expenditures going forward in pretty short order here. Well, that's great to hear.
Speaker Change: This joint venture for not just industry partners, but also financial investors as well. As you know, we've done this in the past. Looks like...
Speaker Change: 6 or 7 wells for sure and I'll be able to give you more information on that dollar amount of expected expenditures going forward in pretty short order here.
Sameer Parasnis: expenditures going forward in pretty short order here. Well, that's great to hear.
Sameer Parasnis: Well, that's great to hear. Congratulations on that also, and I'll turn the call back to the office.
John White: Congratulations on that also, and I'll turn the call back to the offer. Thank you, Sean.
Speaker Change: Well, that's great to hear. Congratulations on that also, and I'll turn the call back to the operator.
Jeff Robertson: Our next question will come from Jeff Robertson with Water Tower Research. You may now go ahead.
Speaker Change: Thank you, sir.
Speaker Change: Our next question will come from Jeff Robertson with Water Tower Research.
Jeff Robertson: Thank you. Good morning.
Tracy Krohn: Tracy, on production, did I hear you write that you all, that some part of the adjustment is related to some unplanned downtime issues with third party pipelines? Yeah, we're having some sales route difficulties with a couple of the pipeline companies that we're trying to resolve. And we have we have all alternative, so it's just more of a negotiation than anything at this point in time.
Jeff Robertson: Thank you, good morning. Tracy, on production, did I hear you right that you all, that some part of the adjustment is related to some unplanned downtime issues with third-party pipelines?
William Williford: Yeah, we're having some sales route difficulties with a couple of the pipeline companies that we're trying to resolve. And we have alternatives, so it's just more of a negotiation than anything at this point in time.
Tracy Krohn: yeah we're we're having some some sales route difficulties with a couple of the pipeline companies that we're trying to resolve and we have we have alternatives so it's it's just more of a negotiation than anything at this point in time
Tracy Krohn: And you mentioned on the reserves that the Cox reserves were higher than part of me than your original estimates. Is that because of data that you had at the time those original estimates were made, or are you seeing some outperformance that's leading to performance-related revisions? Yeah, we are seeing some better performance. Also, you know, we're spending a little time making sure that we have all of our transportation routes. Stream line with regard to some of our other fields in the areas. We're adding people in equipment in some places and reducing people equipment and equipment in others.
Speaker Change: And you mentioned on the reserves that the Cox reserves were higher than your original estimates.
Speaker Change: Yeah, we are seeing some some better performance. Also, you know, we're we're
William Williford: We're spending a little time making sure that we have all of our transportation routes streamlined with regard to some of our other fields and areas.
Tracy Krohn: So we're just moving out that curve a little bit so that we'll have something that's more reliable and won't have all the spiky type of production that you normally have when you first take something over.
Speaker Change: people and equipment in some places and reducing people and equipment in others. So we're just smoothing out that curve a little bit so that we'll have something that's more reliable and won't have all the spiky type of production that you normally have when you first take something over.
Unidentified Speaker: Are some of those changes you're making also having a beneficial cost impact?
Tracy Krohn: Are some of those changes you're making also have a beneficial cost impact? Are you bet. Yeah, we're going to reduce alloy. That's the intent, and we can deal with some of the more tangible transportation issues. One of our biggest costs in the office: transportation, boats, and helicopters. So getting that lined up and optimize is important in reducing those costs. Thank you.
Speaker Change: Are some of those changes you're making also have a beneficial cost impact?
William Williford: Oh, you bet. Yeah, we're going to reduce LOE. That's the intent, and we can deal with some of the more tangible transportation issues. One of our biggest costs in the Gulf is transportation, boats, and helicopters, so getting that lined out and optimized is important in reducing those costs.
Speaker Change: Oh, you bet. Yeah, we're going to reduce LOE.
Speaker Change: That's the intent and...
Speaker Change: And we can...
Unidentified Speaker: Thank you. Thank you, sir.
Operator: Thank you, sir. Again, if you have a question, please cut star than one.
Speaker Change: Thank you.
Operator: Again, if you have a question, please press star then 1.
Speaker Change: Thank you, sir.
Speaker Change: Again, if you have a question, please press star then 1.
Derrick Whitfield: Okay, well, look everyone, thank you for listening today. We appreciate it. We'll be talking to you very soon. Hopefully, with some more good news. Thanks so much.
Speaker Change: Okay, well, look, everyone, thank you for listening today. We appreciate it. We'll be talking to you very soon, hopefully with some more good news. Thanks so much. Bye-bye.
Operator: Bye bye.
Operator: The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.
Operator: The conference is not concluded.
Operator: Thank you for spending today's presentation. You may now.
Speaker Change: The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.