Q1 2025 L.B. Foster Co Earnings Call
Good day, and thank you for standing by. Welcome to the L.B. Foster first quarter 2025 earnings conference call. At this time, all participants on a listen only mode. After this speaker's presentation, there'll be a question and answer session.
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Speaker Change: Please be advised that today's conference is being recorded. I would now like to turn the conference over to your speaker for today, Lisa Durante. Please go ahead.
Speaker Change: Thank you operator, good morning everyone and welcome to L.B. Foster's first quarter of 2025 earnings call. My name is Lisa Durante, the company's director of financial reporting.
Speaker Change: Bill will then review the company's first quarter financial results. John will provide perspective on market developments and company outlook in his closing comments. We will then open up the session for questions.
Speaker Change: Today's slide presentations, along with our earnings release and financial disclosures, were posted on our website this morning and can be accessed on our investor relations page at lbfoster.com. Our comments this morning will follow us live from the earnings presentation.
Speaker Change: These forward looking statements reflect our opinions only as of the date of this presentation and we undertake no applications to revise or publicly release the results of any revisions to these statements in light of new information except as required by securities laws. For more detailed risks, uncertainties, and assumptions relating to our forward looking statements, please see the disclosures in our earnings release and presentation.
Speaker Change: We will also discuss non-GAAP financial metrics and encourage you to carefully read our disclosures and reconciliation tables provided within today's earnings release and presentation as you consider these metrics. So with that, let me turn the call over to John .
John: Thank you, Lisa, and hello everyone. Thank you for joining us today. I'll begin my remarks on slide five covering the key drivers of our first quarter results. As mentioned in our year in and around this report in March, we started 2025 software last year, but first quarter sales down 21.3%. Compared to a typically strong part of your comparison.
John: The client was realized in Charlie within our rail segment, within infrastructure sales going 5% in the last year.
John: Philip I merely by strong demand in our pre-Cath concrete business.
John: It's important to note that our real business can't expect to be strong in the first quarter of last year.
John: and also under 2025 with a lower backlog primarily due to award timing and religious abuse.
John: Rob Distribution to Manus Lumpier Times, and we have experienced quarterly swings in volume of the past, depending on timing of a large project work.
John: This quarter was also impacted by an appearance lowdown in the release of government funding, impacting project activity levels with our customers.
John: But I feel pleased to report that we're starting to see project funding and bidding levels improve, as evidenced by our 46.9% rail backlog increased during the court.
John: Getting back to the results, the lower Q1 sales volume in the rail segment drove the 69.3% decrease and just beat the versus last year.
John: As expected, our net debt increased to 79.9 million during the quarter. Reflecting the increased working capital funding needed support sales growth, along with annual center of insurance premium payments.
John: That debt was up 4.9 million versus last year, and the gross leverage ratio came in at 2.5 times compared to 2.2 times last year.
John: Order rates began to recover on the first quarter, increasing 39.1% commercial.
And 12.6% of her last year. And 12.6% of her last year.
John: This translated to an improved backlog at quarter end of 237.2 million, a 51.3 million during the quarter, and a 15 million over last year.
John: The backlog growth was higher in our more profitable growth product lines, which should translate to near-term sales growth and profitability expansion year or year, as it relates to 2nd quarter.
John: As Bill covers, after Bill covers the financial details for the quarter, I'll come back to him with some those remarks on their backlog trends, a market although, in our financial guidance for the year.
Where do you go?
Bill: Thanks, John . I'll begin my comments on slide seven, covering the consolidated results of the first quarter. As a reminder, the schedules in the appendix provide details on the financial results covered in today's call, including non-GAAP information.
Bill: As John mentioned in his opening remarks, first quarter results were lower than last year driven entirely by lower sales volume in the rail segment.
Bill: Net sales for the quarter were down 21.3% with rail segment sales down 34.6% driven primarily by weak rail distribution demand within the rail products business unit.
Bill: Firstly, our setting to decline was an increase in infrastructure sales, which were up 5% over last year due to a 33.7% increase in pre-cast concrete sales.
Bill: Gross profit was down $6 million, with a gross margin down 50 basis points to 20.6%.
Bill: The decline was driven by lower rail sales as well as slightly unfavorable mix within the rail segment.
Bill: SG&A cost decreased $1.9 million from the prior year due to lower personnel and professional service costs.
and Stephanie Listwak. Thank you. Thank you.
Bill: First quarter, adjusted EBTA was $1.8 million, down 4.1 million versus last year due to the lower margins from the rail sales decline.
Bill: Operating cashflow, which was a use of $26.1 million, followed normal seasonal patterns due to increased working capital needs, coupled with funding for prior year incentives and annual insurance premiums.
Bill: We saw favorable trends in orders and backlogs across the business, which I'll cover by segment later in the presentation.
Bill: Slide 8 provides a reminder of the typical seasonality of our business.
Bill: Tails and EBITDA levels are normally stronger in the second and third quarters, as they represent the primary construction season period for our customers.
Bill: The growth in our backlog during the first quarter gives us confidence that we will see an improvement in sales volumes across the business in the second quarter.
Bill: Free cash flow trends follow a pattern of consumption in the first half of the year, funding sales growth leading up to the construction season.
Bill: This trend reverses in the back half of the year as construction season winds now.
Bill: I'll highlight that despite these large swings, average free cash flow for 2023 and 2024 was approximately $30 million, $1 million, excluding the $8 million Union Pacific payments which are now behind us.
Bill: That's a yield of approximately 15% at our current equity valuation.
Bill: In summary, the softer first quarter is normal for our business and we expect results for the balance of the year to follow our typical seasonal patterns.
Bill: Over the next couple of slides I'll cover our segment performance starting with the rail segment on slide 9.
Bill: First quarter rail segment sales totaling $54 million were down 34.6% due to an exceptionally strong first quarter last year, coupled with the lower order book, Entering 2025.
Bill: The sales decline was primarily in the rail products business unit which was down 44.7% due to the decline in rail distribution volume.
Bill: Technology services and solution sales were also down 41.3% and part due to lower UK sales volumes as we continue to scale back initiatives in this market.
Thank you for watching. Be safe out there. Stay safe.
Bill: On a positive note, global friction management sales were up 11% versus last year, as this growth platform continues to perform well.
Bill: Rail margins of 22.3% were down approximately 20 basis points driven by the sales volume decline and unfavorable business mix.
Bill: Rail orders declined 0.6% versus last year, but increased 51.4% sequentially as we enter the stronger demand periods for the business.
Bill: Backlog level has increased 46.9% during the quarter and 6.6% versus last year.
Bill: The backlog improvement was realized in both rail products and global friction management while technology services and solutions backlog declined driven primarily by the UK.
Bill: Turning the infrastructure solutions on slide 10, net sales increased $2.1 million, or 5% due to the strength in our precast concrete business, which increased 33.7% over the prior year.
Bill: Steel product sales were down $5 million or 24.4% due primarily to lower protective coatings sales.
Bill: Gross profit margins were up 40 basis points to 18.6% due to higher volumes within pre-cast and improved margins and steel products due to our portfolio work.
Bill: Infrastructure orders were very strong at $65.8 million, up $17.2 million, or $35.3% over the prior year quarter.
Bill: Backlog totalling $145.5 million is up $9.3 million over last year, including a $12.1 million increase, or 51.6% from improving protective coding demand.
Justin Bergner, John Kasel, John Kasel, John Kasel, John Kasel, John Kasel, John Kasel.
I'll now cover liquidity and leverage metrics on slide 11.
Bill: Net debt levels increased $4.9 million over the last year to $79.9 million and the gross leverage ratio increased 0.3 times to 2.5 times at quarter-end.
These movements were largely in line with our expectations.
Bill: We're in the heavy working capital investment period of the year, which will continue in the second quarter as we fund expected sales growth.
Bill: Net debt levels should increase modestly during the second quarter, but we expect gross leverage will remain around 2.5 times before declining in the back half of the year.
Bill: We remain confident in our ability to manage the choppy working capital needs of the business and believe the key drivers of strong, sustainable free cash flow remain intact.
Our Capital Allocation Priorities are outlined on slide 12.
Bill: On March 3rd of 2025, our board authorized a new $40 million stock buyback program that will expire at the end of February , 2028.
Bill: During the first quarter, we purchased approximately 169,000 shares, representing approximately 1.5% of the shares that are outstanding.
Bill: This compares to approximately 303,000 shares repurchased in all of 2024.
Bill: Sherry Purchases are an important capital allocation priority for us, especially with the improving prospects for cash generation and the attractive equity valuation.
Bill: We expect to invest capital in our facilities at a rate of approximately 2% of sales with the focus on organic growth initiatives in our growth platforms.
Bill: We also continue to evaluate tuck-in acquisitions to add product line breadth and geographic coverage to our growth platforms.
[inaudible]
Bill: My closing comments will refer to slide 13 and 14 covering orders, revenues, and backlog by business.
Bill: The Book to Bill ratio for the trailing 12 months was a favorable 1.04 to 1 with favorable developments realized in both segments.
Bill: Order 8 improved 39.1% sequentially with increases realized in both segments highlighting the improved trend in demand levels across the business.
Bill: And lastly, the consolidated backlog on slide 14 reflects an improving trend for both segments, with backlog growing during the quarter 46.9% and 17.8% for rail and infrastructure respectively.
Bill: Rail backlog included a $22.8 million increase or 63.4% for rail products driven primarily by improved demand within rail distribution.
Bill: Compared to last year, Consolidated Backlog is up $50 million or 6.7% with gains realized in our more profitable product lines.
Bill: Within rail, rail products and friction management backlog are up 21.2% and 71.4% respectively, while the UK backlog within TSNS is down 52.7%.
Bill: For infrastructure, precast backlog is up 3.8%, and as I mentioned earlier, protective coding backlog is up $12 million, or 51.6%
Bill: We believe these favorable trends will translate into improved results in the second quarter, both in terms of sales volume and margin expansion.
Bill: Thanks for the time this morning. I'll now hand it back to John for his closing mock remarks. Back to you, John .
John: Thanks Bill, please turn slide 16 while we begin my closing remarks, having recent models of
John: Well, first quarter results were done last year. The claim is largely isolated. The weakness and real distribution demand was kind of a real part of the business.
This product finally benefits from the world publicized government infrastructure programs.
John: Which we believe slowed earlier in the year due to uncertainty in the most and continuation of federal funding resulting from Washington's cost-coming initiatives would like.
John: As Bill mentioned in his comments, it is important to note that demand levels for rail costs begin to drop Q1, but the order is subsequently 77.8%.
John: And backlog of both sequentially and euro-weir at the end of the quarter. We also are seeing increasing quotation rates from some of our largest customers, Q to Q.
John: Providing his confidence to demand drivers for real products or getting back on track.
John: The management of friction management solution remains robust, and I'm going to focus on real safety in North America continues to drive demand for total track monitoring solutions. [inaudible]
John: Within their infrastructure segment, demand for our pre-cast concrete products continues to grow, with increased orders of backlog year over year, a top of strong sales growth delivered in the first quarter.
John: We can jeep you see favorable demand-building for our viral cast, broadcast, all-system, non-being manufacturing, floor-up, as well as our ONG protective coding systems. With combined backlogs of 12.1 million or 51.6 percent Euro a year.
John: The increased bad wall coupled with improved profitability next within the bad wall should translate into near-to-m sales growth and profitability expansion year-a-year, as early as the second quarter.
John: We are closely monitoring the status of the government funding programs, but it remains optimistic that they will move forward as it now has given the greater infrastructure to need.
John: As mentioned during our last update, our markets are absorbing the threat of terrorists which primarily piss on our own steel.
John: We continue to take steps in this area to protect our supply chains and build on flexibility to build a possible, recognizing the goal to operate environment.
John: In summary, we expect our key end mark is going to improve in a second quarter.
As we enter the heavier construction season for our customers [inaudible]
John: And as you would expect, we will monitor demand drivers as the balance of the year unfolds and focus on what we can control maximizing opportunity in front of us.
John: A reminder of vestment thesis can be found in slide 17.
John: In summary, the four key pillars of value creation remain unchanged. We've repositioned our business portfolio, which allows us to focus on investment in a highly profitable growth platform to rail technologies of pre-cast concrete.
John: Our cab's light business model drives free cash, lowly and economic profit generation, which in a longer term demand both expected from domestic and infrastructure invests.
John: We continue to employ a disciplined approach to capital allocation to maintain flexibility or drive the showholder returns.
John: And lastly, remain confident in our strategic execution and believe we're well-positioned,
and into the future.
John: A wrap up to today's call by Covering in 2025 Financial Goddess, Thomas Lai-Gon-Key.
John: First quarter results were down from last year's exceptionally strong start, but the first quarter is normally slow, and we enter the second quarter with a strong backlog and proofpoth for the very next, and triple demand drivers are key end markers.
John: The second quarter results are expected to be substantially better than the first quarter, and we expect to realize near term sales growth of property bill expansion year over year as the release of the second quarter.
John: As a result, despite the fall to an uncertain macro embargo, we are maintaining our 2025 financial guidance as with the keen to remain comfort and our ability to deliver results within our guidance for the year.
John: As I mentioned earlier, we remain optimistic that previously known as government funding programs where a construction investment will remain largely attacked.
John: and our 2025 guidance, whose assumption. Knowing that, we will revisit our guidance as appropriate as these market demand drivers and water operating conditions become more clear for the balance of the year.
John: Thank you for your time and continuing interest in L.B. Foster.
John: I'll turn it back to the operator and I'll put a Q&A session.
Speaker Change: Thank you, as a reminder, if you would like to ask a question, please press star on one of your telephone.
John: You'll then hear an automated message advised when your hand is raised.
Speaker Change: We also ask that you please wait for your name and company to be announced before proceeding with your question.
One moment while we take the first question.
Speaker Change: And our first question today is coming from the line of Julio Romero of Sedotti. Your line is open.
Julio Moreira: Great, thanks. Hey, good morning, John Bill. Thanks for taking questions.
Julio Moreira: Hey, so I wanted to start on the rail technology and service the segment.
Julio Moreira: I appreciate the commentary you gave about the lower year year volume and the impact that had on the first quarter and how the rail products business unit was down year over year against the strong prior year quarter in the first quarter. It would seem that the second and third quarter. The third quarter.
Julio Moreira: would also be tough comparable, so was hoping you could talk about how you would have a think about rail products volumes sequentially here in the second quarter and should we expect rail products volumes to also be down in the second quarter on a year of your basis.
Julio Moreira: Thanks, Julio. Thanks for your question today. We're a seasonal construction company, so...
Julio Moreira: We're looking for actually a very big Q2 and Q3 and this is what we really feel good about maintaining our guidance for the year because we really picked up some nice orders entering Q2.
Julio Moreira: In the middle, and our Skype channel partners are ready to perform. So, contrary to maybe your thoughts, we're looking at Big Q2. And the last year wasn't the best Q2 for us. So we're looking.
Julio Moreira: We're looking to put up a number on the board here and show some good activity here in profitability as well in Qtip and real products will be a big piece of that.
Great. Very encouraging there. Thank you.
Julio Moreira: You know, it was good to see that backlog growth and rail here in the quarter. Can you speak to the mix of that backlog growth?
Julio Moreira: Yeah, you know, I was, I've mentioned in building it as well, you know, I can have built, you know, the exact numbers again, but you know, what even though we were down on the real part excited to be clear, you know, it was just a distribution side.
Julio Moreira: A reminder of investors and viewers, a big part of that road distribution business flows through the government, about 82% of it. So that's where we saw a little bit of a pause in the first quarter.
Julio Moreira: But we're seeing that break free now because the nice thing about the rail spaces, they need to replace the rail, right? These things can't just sit there and not be replaced. So that work is beginning to come, but our TTM business, our condition monitoring business.
Julio Moreira: It's really, really doing well, including FM business, and that's where we're seeing even the larger profit parts as well, an opportunity to really get some nice growth, not just on the quarter, but a year over your comparison.
Phil: You know, highlight what those numbers were again. Yeah, for the rail segment, just looking at the year over year growth and backlog, we saw about 22% growth in real products. Friction management was up about 71% on a year over year basis. [inaudible]
Phil: So that again speaks to the improving mix within the backlog.
Phil: And then importantly, we saw a pretty large decline in the UK portion of the backlog, which was down about 53% on a year-over-year basis. And as you know, that market's been challenged for quite a while and we've been scaling back to our initiatives there. [inaudible]
Phil: So all of those moves give us confidence that we're going to see improving profitability mix on the rail portfolio and as long as we as we expect those.
Phil: Government programs remain intact that the volume should be there that would follow that that next improvement as well.
Phil: The up sales in the quarter here just speak to what's working well on that friction management piece and if you're seeing any share gains.
Phil: They were picking up new business, new work and new customers and new geographies.
Phil: And our service team is performing extremely well, so we feel very good.
Phil: About our installed base as it relates to lubricators and then the amount of consumables that's now entering North America as well as outside North America is something we have never seen before. So we're feeling very good about that business there.
Phil: In the business, we talk about tariffs, so in this case, that group is working very well, managing what's in front of us related to, you know, the ongoing tariff threat. That's awesome.
Phil: And I'm very proud of what that group is doing and our customers are getting the benefit of a very good product and service.
Phil: Very good. I'll pass it on it and best of luck in the second quarter. Thanks a lot.
Thank you one more for the next questions.
Speaker Change: And the next special will be coming from the line of Lamberg.
Good morning, Bair. Good morning, John . Good morning, Bair.
Thank you. Bye.
Speaker Change: John , typically, if there's a potential economic or national economic slowdown, the rails tend to see lower traffic volumes, but that's when they take advantage of slower volumes and step-up cat-backs.
Speaker Change: Are you getting any kind of feel for increased capital expenditures on rail projects?
Speaker Change: You know, they don't come on and actually say that, but that's exactly what we're seeing. That's where this backlog and the orders that we're seeing is coming from. This is maintenance and additional capital work that they may be putting out of done. We're going to do that.
Speaker Change: They're not necessarily having capacity, but they're showing up and hurting their tracks. So it's exactly right.
Speaker Change: Great, thank you. And on pipe coding, orders were up, the cells were the cells numbers seasonally, effective seasonally, or is that just project based and just general lumpiness?
Speaker Change: Yeah, you know, I kind of shared with the, I think earlier in the year, we talked about.
Speaker Change: But the new administration that we're probably going to see this thing break free and we have and we're very pleased with the order intake. We've hired a lot of people somewhere around 50 people for this business. We're running
Speaker Change: So we're seeing a very strong year. In fact, I think we're looking at it multiple years of
Speaker Change: Restoring that profitability, that business. Don't remember we have two businesses. We're in line quarter and we're a special coding as well and both businesses have very large opportunities in front of us.
Speaker Change: Similar to what we've seen, you know, maybe six, seven years ago, so we're feeling very, very good about the outlook of this.
Do you want to hear anything about it?
Bill: Results. The coating's business was down a tick. We had a pretty large order that we had received at the end of the previous fiscal year that burned out in Q1 of last year. [inaudible]
Bill: But so the first quarter was a little soft in terms of volume, but as John mentioned, we ended up having a 51% increase in the backlog based on the order intake level that we saw on Q1, and we see that continuing on for the rest of the year.
Thank you.
Thank you, John . Thank you, Bill. Thanks, Leo.
[inaudible]
Thank you. One moment for the next question.
Speaker Change: The next question is coming from the line of Christopher Sakai of Single Research. Your line is open. On the Chris.
Thank you.
Christopher Asake: New orders and infrastructure. What are you seeing there? What's leading to the improvement?
Christopher Asake: Yeah, so we mentioned, you know, Q1 order, a race of 35% pre-casses, it's just doing extremely well.
You know, our strategy was…
Christopher Asake: Continue to double up, double down and we're doing precasts and with our expansion growth in new product lines as well as our new acquisition.
Christopher Asake: Well, that's not so new anymore. It's approaching three years old, but the penetration we're seeing in East Coast and down in Carolina and now with our new operation starting up in Florida. [inaudible]
Christopher Asake: We're just really pleased with what's going on in our pre-cast business, and we're looking for...
Christopher Asake: That really, it really showed up what we had in first quarter, honestly, with the distribution being down and looking for them to have.
Christopher Asake: Sequentially, a couple of really nice quarters put together here. And the nice thing about the business is the Great American Outdoors Act which is really funding for our original legacy business to the building side. We haven't seen any pullback in that as well.
Christopher Asake: So our order rate coming in related to the legacy of precast buildings is...
Christopher Asake: Is this good? If not better than it was even last year. So we're looking at a fantastic year.
Christopher Asake: in that business, in all of my infrastructure, which is really being led by pre-cance.
Thank you.
Speaker Change: Okay, great. Can you talk about potential acquisitions? What are you seeing out there? Is it more of a challenging market now with the talks of the tariffs?
Speaker Change: You know, it is, but we really are mindful of our strategy. We got a bunch of organic opportunities in the world that we are trying to manage.
Speaker Change: So we're busy hiring people, we're busy looking at adding shifts.
Speaker Change: Ember Bezier, bringing in the technical and salespeople to make things happen, including service operations and memorization.
Speaker Change: We're not out really actively looking for acquisitions because we don't need them. What we have from us for the year and the guidance, that's within our ability to perform. We just need to execute.
Speaker Change: Now, if it makes sense to do some smaller tuck-in type things, we, of course, we're of course always looking at those things, but it's really not front of center or front of mind for us right now, Chris.
Justin Bergner, John Kasel, John Kasel, John Kasel, John Kasel, John Kasel,
Thank you.
Okay, great. Thanks for the answers.
John Bair, John Bair, John Bair, John Bair, John Bair.
Yes, thank you.
Speaker Change: Thank you, as a reminder, if you would like to ask a question, please pet star one one on your telephone.
One moment for the next question.
Speaker Change: And our next question is coming from the line of Justin Bergner of Gambelli, funds, your line is open.
Speaker Change: A few questions here. You mentioned that weaker mix was a driver of slightly lower gross margins in your rail segment.
Speaker Change: But I guess I didn't necessarily follow that given the pieces you broke out in this crank than the friction side versus the real product side.
Speaker Change: Yeah, so the volume impact on real products was a part of it, just given the cost structure within the overall business.
Speaker Change: But then we also had our TTM business, which is the Total Track Monitoring component of the business, had a pretty strong start to the year last year as well. So their volume decline was also a contributing factor. But if you look across the entire rail segment, the largest impact overall was by far the rail distribution volume.
Speaker Change: And the TTM piece, we were seeing nice bidding activity there, so that was more of a temporary factor than anything.
Okay, that makes sense. Are you seeing any... [inaudible]
Speaker Change: Benefit or impact from higher steel prices in your rail products business as it relates to...
You know, dollar or...
Yeah, good question. So, you know, back in...
Speaker Change: And the first front administration, right, with the Terrace in 232 in steel.
Speaker Change: We benefited from that because as the steel input cost rose, we passed out of the marketplace today.
Back then.
Speaker Change: Well, we're going to see the same thing and we're seeing the same thing actually this year. As things continue to move forward, prices go, we'll be able to pass those on.
Speaker Change: So I think we're set up very well as the tears continue to, you know, how real they are. We'll be ready to make sure that we pass those out and get paid for.
Speaker Change: Okay, that makes sense as well. In terms of the funding being released, is that comment mainly relevant to the rail products business as you look at the rest of the year? There are other...
Speaker Change: Yeah, well, it's a specifically role distribution, so you know, behind role distribution.
Speaker Change: is the transit business and behind the transit is government authorities. That's how it all flows. So put this in perspective for you, we won't be talking about it down a quarter if we just ship two or three more trains.
Speaker Change: That's how close it is, and that's how won't be it is, and that's what kind of construction work we do. So instead of those two or three trains being in Q1, this is again, you know, providing rail to the transit authorities, you know, a little now going Q2. So we'll see that pickup.
Speaker Change: And it is all about the government programs, it's all about government funding, and it's about, you know, just being able to slow it just started the year with all these things going on in Washington, but we're seeing that change here pretty quickly.
Okay, thank you. Lastly...
Speaker Change: Could you comment at all at what you're seeing in April in terms of sales and orders, you know?
for...
versus the first quarter quality.
Speaker Change: Yeah, we hope we always love questions like that because we don't typically talk about that, but I'm not discouraged, let's put it that way, for where we're at sitting here and able.
Speaker Change: And when we talk and I close up today's speech about, you know, giving confidence that we're going to get our urine guidance, it's mindful what's going on in the paper.
Speaker Change: Okay, you still think they fight the upper half of the guidance?
is possible based on where we...
Speaker Change: We stand today. Yeah, I just, you know, we're lining up to our guidance. So.
Speaker Change: We'll see where all the chips fall. I will tell you, our operations are ready to perform. So as the work continues and things get freed up here, we're ready to perform and ready to deliver.
Thank you. Thank you.
Okay, thanks so much. Thank you.
Speaker Change: Thank you, and this does conclude today's Q&A session. I would like to turn the call back over to John Kasel.
C.O. 4 close remarks, please go ahead sir.
John Kasel: Thank you very much. Thank you for joining us today. It's plenty of things that you get through the quarter, and you get to the next quarter. That's how myself and the management team are looking to put that behind us. I really focus on what's in front of us right now because we have much to do. [inaudible]
John Kasel: So, thanks for your time today, and we look forward to talking to you after the pose of the second important take care of it.
John Kasel: Thank you for your participation of today's conference call. You may now disconnect.