Q1 2025 Peyto Exploration & Development Corp Earnings Call
Operator: Hello and welcome to Peyto's first quarter 2025 financial results conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session.
Hello, and welcome to pay tolls first quarter 'twenty to 'twenty five financial results conference call.
At this time all participants are in a listen only mode.
After the speaker's presentation, there will be a question and answer session to ask a question. During the session you will need to press star one on your telephone you would then here automated message advising your hand is raised.
Operator: To ask the question during the session, you will need to press star 11 on your telephone. You will then hear an automated message advising your hand is ready. To withdraw your question, please press star 11 again.
To withdraw your question. Please press star one again.
Operator: I would now like to turn the conference over to J.P.
Speaker Change: I would now like to turn the conference over to J P shots, President and CEO you may begin.
J.P. LeChant: LeChant, President and CEO. You may begin. Thanks, Wanda.
J.P. LeChant: Morning, folks, and thanks for joining Peyto's first quarter conference call. Before we begin, I'd like to remind everybody that all statements made by the company during this call are subject to the same overlooking disclaimer and advisory set forth in the company's news release issued yesterday.
Speaker Change: Thanks to Wanda morning, folks and thanks for joining <unk> first quarter conference call.
Speaker Change: Before we begin I would like to remind everybody that all statements made by the company. During this call are subject to the same forward looking disclaimer and advisory set forth in the company's news release issued yesterday.
J.P. LeChant: Present with me to answer questions is Riley Frame, our Chief Operating Officer, Tavis Carlson, our CFO, Todd Burdick, our VP of Production, Derek Zember, our VP of Land and Business Development, and the newest members of our senior management team, Mike Collins, Mike Reese, and Chrissy Rafeau. Before we begin the quarter, on behalf of the management group, I'd like to say a big thank you to the entire Peyto team, both in the office and in the field for their contributions to another strong quarter. and it's been an event filled first four months of 2025. We started out warm in January, but got some very cool weather in February across all of North America.
Speaker Change: Present with me to answer questions as Ronnie framework, Chief operating officer, John <unk>, Our CFO, Todd Burdick, our VP of production Derek Zemba, our VP Atlanta business development and the newest members of our senior management team, Mike Collins, Mike Reese and Christy.
Speaker Change: Christy reflects.
Speaker Change: Before we begin the quarter on behalf of the management group I'd like to say a big Thank you to the entire Peyto team both in the office and the field for their contributions to another strong quarter.
Speaker Change: And it's been an event filled first four months of 2025, we started out warm.
Speaker Change: Arm in January but <unk> got some very cool weather in February across all of North America and that set gas prices up sharply at mini hubs data was fortunate to have some of our gas wondered if these markets.
J.P. LeChant: And that sent gas prices up sharply at many hubs and Peyto was fortunate to have some of our gas pointed at these markets. It's been very significant. It also took a significant dent out of Alberta gas storage inventories, which otherwise would have been very full coming out of winter and into injection season. Although we believe tariffs as they currently exist have a minimal impact on Peyto's business, the uncertainty of the world economy continues to prevail and it's likely going to be a bumpy ride for a while. But you know, despite all this turmoil, it's business as usual for Peyto and we continue to manage the things that we control, like drilling good wells and managing our production operations.
Speaker Change: It's been very it's also took a significant dent out of Alberta gas storage inventories, which otherwise would have been very full coming out of winter and into injection season.
Speaker Change: Although we believe jour tariffs as they currently exist have a minimal impact on <unk> business.
Speaker Change: The uncertainty of the World economy continues to prevail on its likely going to be a bumpy ride for a while.
Speaker Change: Despite all this turmoil it's business as usual for pedal.
Speaker Change: And we continue to manage the things that we control like drilling good wells and managing our production operations.
J.P. LeChant: Turning to Apatow specifically, we generated funds from operations of $225 million in the quarter, thanks in part to our gas hedging gains, which amounted to $0.83 per MCF, and our gas diversification portfolio, which created another $1.13 per MCF in value. Together that fetched us $4.17 per MCF in the quarter, or 89% higher than the monthly Tavis Carlson, Tavis Carlson, Aaron Bilkoski, Peyto Exploration & Development And with that superior gas revenue, the superior gas revenue of our marketing program, it allowed us to generate a strong 71% operating Cash costs were $1.42 per MCFE for the quarter, down from $1.51 per MCFE in Q1 of 2024, as we continue to realize synergies with the REPSOL assets in our operations.
Speaker Change: Now turning to <unk>, specifically, we generated.
Speaker Change: Funds from operations of $225 million in the quarter. Thanks, Thanks in part to our gas hedging gains which amounted to about.
Speaker Change: Our amount of tools.
Speaker Change: <unk> per Mcf, and our gas diversification portfolio, which created another $1 13 per mcf and value.
Speaker Change: Together, that's just $4 17 per mcf in the quarter or 89% higher than the monthly equal price.
Speaker Change: We still lead the industry with the lowest cash cost.
Speaker Change: And with that superior gas revenue.
Speaker Change: Spirit gas revenue of our marketing program it allowed us to generate a strong 71% operating margin.
Speaker Change: Cash costs were $1 42 per Mcf for the quarter down from $1 51 per Mcf in Q1 of 2024, as we continue to realize synergies with the repsol assets in our operations our.
J.P. LeChant: Our operating costs are typically higher in the first quarter due to the extra costs associated with operating in the cold, and we expect that they will continue to come down throughout the year, very similar to last year. We spent $102 million of capital this past quarter, and the strong cash flow that we had not only allowed us to pay out $66 million in dividends, but coincidentally also allowed us to retire about $66 million in debt, net debt. On the marketing side of our business, our gas diversification to US price markets such as Parkway and Dawn, and then US Midwest like Ventura and Chicago, we gas pointed Emerson, Henry Hub, they all contributed to a sound beat relative to the average monthly eco price of $1.92 a DJ.
Speaker Change: Our operating costs are typically higher in the first quarter due to the extra costs associated with operating in Coles, and we expect that they will continue to come down throughout the year very similar to last year.
Speaker Change: We spent $102 million of capital this past quarter and the strong cash flow that we had not only allowed us to pay down or to pay out $66 million in dividends, but what's it definitely also allowed us to retire about $66 million in debt.
Speaker Change: Net debt.
Speaker Change: On the marketing side of our business, our gas diversification to U S price markets, such as Parkway and dawn and in the U S. Midwest like Cninsure in Chicago, We guesstimate at Emerson Henry hub. They all contributed to a sound beat relative to the average monthly equal price of $1 92, a T J.
J.P. LeChant: However, Alberta gas pool prices averaged only $40 a megawatt, fetching us a similar price to ACO for the quarter on our direct supply deal to the Cascade power plant. Just a reminder, we're at the start of a 15 year deal there and, you know, longer term as power demand increases, we expect that contract will be quite lucrative. You know, in the meantime, this is exactly why we want our gas to be directed to multiple markets. So we're not relying on just one customer. Obviously, he's not good. Looking forward to the summer and the rest of 2025.
Speaker Change: However, Alberta gas pool prices averaged only $40 a megawatt catching us a similar price to April for the quarter on our direct supply deal to the Cascade power plant.
Speaker Change: And just a reminder, we're at the start of a 15 year deal there.
Speaker Change: Longer term as power demand increases, we expect that contract will be quite lucrative.
Speaker Change: In the meantime, this is exactly why we want our guests to be directed to multiple markets. So we're not relying on just one customer.
Speaker Change: Obviously is not good business model.
Speaker Change: Looking forward to the summer and the rest of 2025, we are excited as most producers are about the prospect of gas hitting off the west coast through LNG, Canada. This year.
J.P. LeChant: We're excited as most producers are about the prospect of gas heading off the west coast through LNG Canada this year. We think this will be constructive to the ECO market, but the timing of the startup and the duration to ramp up to full capacity are still to be determined. In the meantime, we only have a small amount of our natural gas exposed to the ECO market through 2025. Switching to operations, we drilled 19 wells in the quarter, completed 13 and tied in 14. a part of the drilling program included a follow-up to the Florific flare channel that we discovered last year.
Speaker Change: We think this will be constructive to vehicle market, but the timing of the start up and the duration to ramp up to full capacity are still to be determined.
Speaker Change: In the meantime, we only had a small amount of our gas or natural gas exposed to vehicle market through 2025.
Speaker Change: Switching to operations, we drilled 19 wells in the quarter completed 13 and tied in 14.
Speaker Change: Part of the drilling program included a follow up to the terrific flare channel that we discovered last year.
J.P. LeChant: It tested, the latest well test is similar to the other two wells on that trend which were amongst the top decile of our individual well returns that we drilled last year. Mike Reese and his team see another 20 plus locations there to drill on that trend in the fullness of time. We also drilled a couple of low-working-interest accardium wells in the Chambers area to test a different drilling technique. It's new to Peyto, but not to the industry. We targeted lower-in-the-zone to improve drilling penetration rates. Each of those two wells we drilled had 2,500-meter laterals and took about two weeks to drill from spud to rig release, so costs were way lower than our conventional method.
Speaker Change: Yes.
Speaker Change: Well test is similar to the other two wells on that trend, which we're amongst the top decile of our individual returns with that we drilled last year.
Speaker Change: Unlike recent as GMC, another 20, plus locations there to drill on that trend in the fullness of time.
Speaker Change: We also drilled a couple of low working interest Cardium wells in the chambers area. It's just a different drilling technique, its snood payroll, but not to the industry.
Speaker Change: We targeted lower in the zone to improve drilling penetration rates.
Speaker Change: Each of those two wells, we drilled 2500 meter laterals and took about two weeks to drill from spud to rig release, so costs were way lower than our conventional method.
J.P. LeChant: We stimulated each of those with a 60-stage ball drop cemented liner system and they're flowing back now. We intend to follow up with a couple more wells later in the year to continue to test this concept.
Speaker Change: We stimulated each of those with 60 stage ball drop cement cemented liner system and they're flowing back now but.
Speaker Change: We intend to follow up with a couple more wells.
Speaker Change: Later in the year to continue to test this concept and why does it matter, while 25% of our Undrawn <unk> reserves are booked to the Cardium in this method could improve the economics of some of those plays.
J.P. LeChant: Why does it matter? Well, 25% of our undrilled 2P reserves are booked to the cardium and this method could improve the economics of some of those plates. Facility capital was a little lighter than usual in Q1. We expect Q3 will be a bigger outlay of that part of our business since we have the old man plant turnaround scheduled for September and the construction of a field compressor project in the Obed area. That will, the OBIT compressor project will bring more liquid rich gas to the Edison gas plant via the central foothills gas gathering system in Q4.
Speaker Change: Okay.
Speaker Change: It's the only capital was a little lighter than usual in Q1.
Speaker Change: We expect Q3 will be a bigger outlay of that part of our business. Since we have the old man plant turnaround scheduled for September and the construction of our field compressor project in the <unk> area.
Speaker Change: The OLED compressor project will bring more liquid rich gas to the Hudson gas last year.
Speaker Change: Fort Hills gas gathering system in Q4.
J.P. LeChant: We did construct a pipeline project in Q1 that was As part of that capital outlay to connect some third party gas to the Brasel plant. and this is for a multi-year agreement that is strategic and that we can use it for other third parties in the area too. We have lots of spare capacity at Brazil and this won't impact our growth plans there. We continue to pursue other third party volumes in key areas like Edson where we have an extensive large diameter gathering system and spare capacity that could be used. Looking forward, our business plan and guidance remains unchanged for 2025.
Speaker Change: We did construct a pipeline project in Q1 that was.
Speaker Change: As part of that capital outlay to connect some third party gas to the Brasil plant.
Speaker Change: And this is for a multi year agreement that is strategic and that we can use it for other third parties in the area too.
Speaker Change: We have lots of spare capacity at Brazil in this more impact our growth plans there.
Speaker Change: Beyond Brazil, we continue to pursue other third party volumes in key areas like Edson, where we have an extensive large diameter gathering system and spare capacity that could be used.
Speaker Change: Looking forward, our business plan and guidance remains unchanged for 2025.
J.P. LeChant: As I said earlier, business as usual, we plan to spend between $450 to $500 million to generate production ads at a capital efficiency rate between $10,000 and $11,000 per flowing BOE by year end. And that should be more than more than enough to offset our annual corporate decline rate of 27%. So we think it's a very exciting time to be a natural gas producer in Canada.
Speaker Change: As I said earlier business as usual, we plan to spend between $450 million to $500 million to generate production adds.
Speaker Change: Capital efficiency rate between 10 and 11000.
Speaker Change: Dollars per flowing Boe by yearend.
Speaker Change: And that should be more.
Speaker Change: More than enough to offset our annual corporate decline rate of 27%.
Speaker Change: We think the future is bright for natural gas, especially as LNG projects, LNG, Canada, and others come to fruition.
Speaker Change: We'll believe Alberta is the right place to develop data centers and we know that there are approximately 10 gigawatts.
Speaker Change: Projects in diesel Q, excuse me Wonder Valley and.
Speaker Change: And maybe all of these projects don't get built they have the potential to increase Alberta gas demand by one three Bcf a day over the next few years.
So we think we're in.
Speaker Change: It's been it's a very exciting time.
Speaker Change: To be announced gas producer in Canada.
Operator: So with that, Tawanda, I imagine there's some questions that maybe we'll open up to the phones and pick some callers questions about the port. Thank you. Ladies and gentlemen, as a reminder to ask a question, please press star 11 on your telephone, then wait for your name to be announced. to withdraw your question. please press star 11 again. Please stand by while we compile the Q&A roster.
Speaker Change: So with that <unk> I imagine there's some questions that maybe we'll open it up to the phones and take some callers questions about the quarter.
Speaker Change: Thank you.
Speaker Change: Ladies and gentlemen, as a reminder to ask a question. Please press star one on your telephone and wait for your name to be announced.
Speaker Change: Withdraw your question.
Speaker Change: Please press star one again please.
Speaker Change: Please stand by while we compile the Q&A roster.
Amir: Our first question comes from the line of Amir with ATB. Your line is open. Thanks.
Speaker Change: Our first question comes from the line of Amir with ATB. Your line is open.
Amir: Good morning, JP. Just had a quick follow up question for you regarding that cardium well. Was the difference in this well related just to the drilling in terms of drilling lower in the cardium, just getting better rate of penetration? Or did you do anything different with the completions as well, in terms of the 60 stage ball drop?
Amir: Alright. Thanks, Good morning, J P. Just had a quick follow up question for you regarding that Cardium well what is the difference in this well related just to the drilling in terms of drilling lower in the Cardium, just getting better greater penetration or did you do anything different with the completions as well.
Speaker Change: In terms of the 60 stage ball drop.
J.P. LeChant: Yeah, so yeah, we do a little bit lower in the card information, as I mentioned earlier, but yes, we did change the completion up. I'll maybe get Riley to comment or some more specifics around that.
Speaker Change: Yes, so yes, we do have a little bit lower in the card information as I mentioned earlier, but yes, we did change the completion up I'll, maybe get Reilly to comment some more specifics around it maybe Rob you can elaborate a little bit more on what exactly.
Riley Frame: Maybe Riley, you can elaborate a little bit more on what exactly. The concept of drilling in the bioturbated or lower portion of the cardium has been around for a while. Lots of guys down in the farrier area are doing it. The big difference is just the rate of penetration that you're able to achieve in that lower zone is quite a bit higher. The other advantage that we got out of doing it this way was also being able to drill these wells as a true monobore. So setting a surface casing and then drilling all the way to TD without setting intermediate.
Speaker Change: Yes, so I mean, the concept of drilling in the biotech weighted or lower portion of the Guardian has been around for a while lots of guys down a barrier or youre doing it.
Speaker Change: But yes. The big difference is just the rate of penetration that you are able to achieve in that lower zone is quite a bit higher than the other advantage.
Speaker Change: That we got out of doing it. This way it was also being able to drill these wells as a true mono bore so setting a surface casing and then drilling all the way to TD without setting intermediate so.
Riley Frame: So that monobore drilling low and then setting the cemented ball drop liner system were the three main components that really changed the overall design of these wells for us and the cost structure associated with those has come in really, really good. To give you some sense of it, our drill cost for horizontal meter was 40% less than our historical program in this area. As JP alluded to, the impact on the go-forward cardium could be fairly significant if we can continue to see success with this. The completion side, aside from the size of it, just fairly standard completion, typical to what we would normally pump except just obviously scaled to the 60 stages that we ran in the well.
Speaker Change: So does that mono bore drilling low and then setting the cemented ball drop liner system are the three main components that really changed.
Speaker Change: The overall design of these wells for us and that the cost structure associated with those things come in really really good so just.
Speaker Change: To give you some sense of it are our drill cost per horizontal meter was 40% less than our historical program in this area. So.
Speaker Change: JP alluded to the <unk>.
Speaker Change: The impact on the go forward Guardian.
It could be fairly significant if we can continue to see success with this.
Speaker Change: No.
Speaker Change: And on the completion side aside from the size of it just fairly standard completion.
Speaker Change: Typical to what we would normally.
Speaker Change: Obviously scale too.
Speaker Change: The stages that we ran.
Riley Frame: So with the longer lateral like 60 stages on a ball drop is still fairly effective, like you don't get to an issue of the small ball size. We definitely like there is definitely frictional issues towards the end of the lateral, but we're still able to pump at at rates that are comparable to what the guys are doing with the coil shift. So, um, we didn't see too many issues and we were able to place everything that we wanted to in this.
Speaker Change: So okay, so with the longer lateral like 60 stages on a ball drop as scope fairly effective like you don't get to an issue of the small bolt ons.
Speaker Change: We definitely like there is definitely a frictional issues towards the end of the lateral but we're still able to pump at at rates that are comparable to what the guys are doing with the coil shift so.
Speaker Change: We didn't see too many issues and we were able then to place everything that we wanted to do in this well at $60.
Amir: Okay, okay, I appreciate the color.
Amir: And then just a second question more on the hedges. I know you have a diversified program and you layer in hedges, regardless of the of the gas price. Just curious, what is your target for percentage hedge for given that you're now starting to layer in 27 hedges? So just curious what your target would be for 26 and 27. By the time we get to the end of in terms of percentage times that you'd like to be. As a reminder, the mechanical nature of our hedging program is such that we want to land in a current season anywhere between 50, say as much as the 80, 75 to 80 percent hedged volumes hedged once we arrive in that season.
Speaker Change: Okay I appreciate the color and then just.
Speaker Change: Second question more on the hedges.
Speaker Change: Alright.
Speaker Change: I know you have a diversified program would you layer on hedges, regardless of the gas price just curious what is your target for percentage hedged for given that Youre now starting to layer in 2007.
Speaker Change: Just curious what your target would be for 2006 and 2007 by the time, we get to the end of 'twenty five.
Speaker Change: So in terms of percentage hedged that you'd like to be.
Speaker Change: As a reminder, the mechanical nature of our hedging program is such that we.
Speaker Change: We want to land in a current season anywhere between 50 to say as much as say 80, 78% hedged volumes hedged when once we arrive in that season, but were going three years out so six seasons out six gas seasons out. So we will we will pilot such that we're doing is fairly regularly get routinely.
J.P. LeChant: But we're going three years out, so six seasons out, six gas seasons out. So we will time it such that we're doing this fairly regularly and routinely, not at any price. We do have some lower end targets. We're not going to hedge gas at $2. But certainly, as we move forward, we're going to continue to hedge out $27 and bring that up in the curve as we get closer and closer to it. And so that way, we're not speculating on price. We're doing this fairly regularly. We're doing this systematically over time. So like dollar cost averaging, right.
Speaker Change: At any price, we do have some lower end targets were not been hedged gas at $2.
Speaker Change: But certainly as we move forward, we're going to continue to hedge out 27, and bring that up in the curve as we get closer and closer to it that way, we're not speculating on price, we're doing as well.
Speaker Change: Were doing it systematically overtime, so like dollar cost averaging right. So that hasnt changed nothing has changed our strategy.
J.P. LeChant: So that hasn't changed, nothing's changed in our strategy. So our, you know, our, our guardrails, as we like to call it, are 50 to say 75% in the current season when we arrive, and that tapers down as we move out in the future over the next three years.
Our our guardrails as you'd like to call. It our 50 to say, 75% in the current season, when we arrive and that tapers down as we move out.
Speaker Change: In the future over the next three years.
Speaker Change: Okay sounds good thanks for the color.
Amir: Thanks for the call.
Amir: Thank you.
Speaker Change: Thank you.
Operator: Ladies and gentlemen, that's star 11 to ask the question.
Speaker Change: Ladies and gentlemen that star one to ask a question.
Operator: I'm showing no further questions in the queue.
Speaker Change: I'm showing no further questions in the queue I would like to turn the call back over to J P.
Todd Burdick: I'd like to turn the call back over to JP. Yeah, we do have some other questions that have come in here overnight or certainly live from yesterday. So I'll maybe I'll turn to Todd Burdick, Tavis Carlson, Aaron Bilkoski, Peyto Exploration & Development, Tavis Carlson, Peyto Exploration & Development, Tavis Carlson, Aaron Bilkoski, Peyto Exploration & Development, Tavis Carlson, Aaron Bilkoski, That's we're quickly coming out of breakup here. So we should see those costs improved but You know, we continue to work on small projects within the Edson gas plant That are aimed at reducing costs at the plant including we recently completed a project that allows for delivery of produced water into the plant and then on to the plants disposal well So we expect we expect that will result in a modest reduction to our water handling costs as we Sort of understand better the compatibility side of water and that sort of thing We expect to expand the I guess area around the plant that will able to that We'll be able to bring water in instead of bringing it to third party processors of and disposal companies Additionally, we also made some changes to some of our maintenance contracts at a few of our gas plants Which should you know help with a small reduction in some of the plant maintenance costs and Then on the chemical side in May we saw a 10% reduction in methanol costs which is encouraging given we saw about a 25% increase over the past year and While we're cautiously optimistic, obviously, you mentioned the bumpiness of the world markets and methanol is sort of tied to the world economy in some ways.
Yes, we do have some other questions that have come in here overnight or are certainly lap from yesterday, so I'll, maybe I'll turn to.
Todd: Todd for one year, it's about operating costs.
Todd: We were down at <unk> 50 per Mcf Graham Cfe last quarter were down year over year I know are our costs, usually fall down will drop throughout the year, we have a history of doing that but maybe you want to provide some more color on how youre going to get there as we move forward throughout the rest of the year, Yes sure yes.
Todd: Obviously like you mentioned Q1 typically higher Q2.
Todd: Can be able to earn.
Todd: Around the same maybe a little lower depending on how breakup goes.
Todd: Obviously, we're hauling water at half load so you've got twice the trips.
Todd: The cost on that side of things so.
That's we are quickly coming out of breakup here. So we should see those cost improved but.
Todd: We continue to work on small projects within the <unk> and gas plant.
Todd: That are aimed at reducing costs at the plant.
Todd: Including we recently completed a project that allows for delivery of produced water into the plant and then on to the <unk>.
Todd: <unk> disposal well.
Todd: So we expect we expect that will result in a modest reduction to our water handling cost.
Todd: As we sort of understand better the compatibility side of water and that sort of thing we expect to expand the.
Todd: I guess area around the plant that will label that we will be able to bring water and instead of bringing it to a third party.
Todd: Processors and disposal companies.
Todd: Additionally, we also made some changes to some of our maintenance contracts that a few of our gas plants.
Todd: Sure.
Todd: Help with a small reduction in some of the plant maintenance costs.
Todd: And then on the chemical side and May we saw a 10% reduction in methanol costs.
Todd: Which is encouraging given we saw about a 25% increase over the past year.
Todd: While we are cautiously optimistic obviously you mentioned the lumpiness.
Todd: <unk> markets and as methanol is sort of tied.
Todd Burdick: So we don't have a clear line of sight if those prices are going to continue to drop or even hold where they are currently, but we're cautiously optimistic on that front. So you put all those together, we've Small little gains that we're getting right now and we're not getting big gains by shutting in sour production and things like that but we'll continue to push and work on it in fractions of a penny. You know, we always don't.
Todd: The world economy in some ways. So we don't have a clear line of sight. If those prices are going to continue to drop or even hold where they are currently but were.
Todd: We are cautiously optimistic on that front. So you put all those together.
Todd: Sure.
Todd: It's small little gains that we're getting right now we're not getting big gains by shutting in sour production and things like that but we're continuing to push.
Todd: Got it.
Todd: <unk> a penny if you will.
We have always done.
Todd: Yes.
Todd: Okay.
Todd: Any more questions on the call is less so I might just wrap it up here folks because we all got work to do.
Todd: So thanks for tuning in to remember our AGM is next week Thursday may 22nd at three P. M and are building on the plus 15 level, that's an in person meeting or more.
Todd: So we're not telecast live, but we'll report it and we'll put it up on the website later so vote now if you haven't already and we will see you at that meeting or <unk> on the next conference call.
Operator: Ladies and gentlemen, that concludes today's conference call. Thank you for your participation. You may now disconnect.
Speaker Change: Thank you ladies and gentlemen that concludes today's conference call. Thank you for your participation you may now disconnect.
Speaker Change: Okay.
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Operator: Thanks for watching!
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