MEGEF Q2 2018 Earnings Call
Operator: Good morning. My name is Chris and I will be your conference operator today. At this time, I would like to welcome everyone to the MEG Energy Second Quarter Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. [Operator Instructions] I will now turn the call over to Mr. John Rogers, VP of Investor Relations and External Communications. Please go ahead.
John Rogers: Great. Thank you, Chris, and welcome everyone to our second quarter conference call. I have with me in the room today Mr. Jeff McCaig, who is MEG's Independent Chairman; Harvey Doerr, our Interim CEO; Eric Toews, our CFO; and Helen Kelly, who is the Director of Investor Relations. The call will contain and does contain forward-looking statements and information, and please refer to our filings on SEDAR to actually review all of the qualifications around them. Jeff is going to provide an update on the CEO search and a review of the Board's perspective on the business overall. Harvey will give a commentary on the quarter. And then we'll open it up to questions. So, from here, I'll pass it over to Jeff for his comments. Jeff, go ahead.
Jeffrey J. McCaig: Thank you, John. Good morning, everyone. On behalf of the Board, I'd like to spend a few minutes to give you an update on the executive search and where we are as a company. On CEO search, as you know, Bill McCaffrey retired from the CEO role during the second quarter. The Board was pleased that Harvey Doerr, one of our Directors, agreed to serve as Interim CEO and Harvey has been in that seat since June 1. The Board has conducted with the help of professional advisors a very active executive search process for MEG's first non-founder CEO. A committee of the Board was struck to oversee the process and to engage with the external search firm. The Board has carefully considered the skills and experiences that we believe are most important in a leader for this business. We are focused on hiring someone with deep knowledge of our business and markets, of the highest integrity with proven operating experience, and a successful record of focusing on efficiency and cost containment, an individual who possesses vision and a strategic sense and is a disciplined allocator of capital. We've been delighted with the responses received from candidates and a number of talented executives that have expressed an interest in serving as MEG's next CEO. We have moved into a shortlist of these candidates with whom we are actively engaging. We are getting close to a final decision and hope to have an announcement to communicate to you this month. As we look forward to welcoming a permanent CEO, and before I turn this call over to Harvey to allow him to discuss the quarterly earnings, I'd like to review the positioning of the Company at this important juncture, highlighting some of the important work that the Board and management have undertaken over the last few years and more specifically in recent months. First of all, strategy. Immediately upon appointing Harvey as Interim CEO, the Board requested a comprehensive review of the Company's strategy. After completing that review, the Board came to the conclusion that the business has never been in a better place and we are on the right strategic path with Vision 20/20. This strategy focuses primarily on the continued development of our high-quality resource base, using state-of-the-art technology while maximizing the revenue we receive for each one of our barrels produced, and we expect to deliver substantial value enhancement to our shareholders. Secondly, on capital structure; in the last two years we refinanced and extended our debt. There are no looming maturities. In September 2015, we proactively kicked off a deleveraging campaign centered around our midstream assets, which ultimately resulted in the sale of the Access Pipeline and the Stonefell Terminal earlier this year. It took a great deal of patience to maximize the value for these assets, but we feel the ultimate proceeds received provided a very fair return to our shareholders. We used the majority of the proceeds from the monetization to pay down debt reducing it by over 25% and the balance was used and is being used to fund our Vision 20/20. As a result, we anticipate our debt-to-EBITDA ratios falling to the range of 2x to 3x in the next 18 to 24 months, and that's assuming today's commodity price environment. Thirdly, on costs; we have reduced our per-barrel G&A by over 50% since 2011. Absolute G&A has come down by over 25% since its peak in 2015. Today, we already have a highly competitive overall cost structure, taking into account G&A and OpEx substantially below our peer group average, approximately 25% below. However, there is more to be done. Board and management remain focused on maintaining and improving our cost competitiveness. As production grows to 113,000 barrels today, we anticipate our G&A cost to drop below $2 a barrel, supporting overall cash cost savings of approximately $3 a barrel. Harvey's team has been tasked to conduct further reviews on opportunities to improve the Company's cost structure and so far they've identified another $10 million in run rate G&A savings. Next, capital allocation. We take an equally rigorous approach to how we manage our capital investments. At the core of our business is the high-quality resource base at Christina Lake. The majority of our investments to date have gone towards the development of this project. In 2018 alone, 98% of our CapEx was dedicated to Christina Lake. Not only do we believe that it's one of the highest quality assets in the industry, we have also managed to drastically reduce our capital cost intensities by 50% with the application of state-of-the-art technology. We sharply curtailed expenditures related to non-Christina Lake development such as the HI-Q partial upgrading project at the end of 2014, and today we are announcing that we have engaged TD Securities to reduce strategic alternatives with respect to this technology. We are seeking a third-party transaction to take HI-Q to commerciality while retaining access that will not require us to invest additional capital. Going forward, we have substantial inventory of high-return projects in the core of our Christina Lake producing properties, where the majority of our future capital will continue to be dedicated towards a prudent pace of growth. Lastly, I'd like to address governance. As a Board, we remain focused on serving our shareholders and discharging our fiduciary obligation to act in the best interests of the Corporation. In the last few years, we've separated the Chair and CEO role. We have focused on Board renewal, adding new and diverse highly qualified directors, introducing age and tenure limits, and ensuring a wide breadth of experience and knowledge. We added several new Board committees to further increase the Board's engagement and oversight on key strategic initiatives such as deleveraging, hedging, and of course the CEO search committee. With that done, we will continue to ensure that we are on the right strategic path with the right leadership team. The Board is very optimistic about both our short and long-term future. Stock performance year-to-date reflects some of the progress we've made, but our work is not done. We believe that we have the assets, technology, capital, and execution capability to complete our low-risk plan to create significant value for our shareholders through 2020 and beyond. With that, I'll turn it over to Harvey.
Harvey Doerr: Thanks, Jeff. As Jeff mentioned, I've been here in the CEO role since June 1 and I've actually been full time in the Company since the end of April. It's been a busy time. We conducted a full strategy review for the Company in mid-June and subsequently have undertaken detailed reviews on G&A, capital spending, and other areas. I think we're making good progress and I would say I'm very pleased to be here with such a talented group of people working on such an excellent resource base. And it's especially been an honor to be here during a period of time when we actually hit 100,000 barrels a day for the first time on July 12. So, turning to operations; second quarter production averaged 71,000 barrels a day, obviously down from first quarter as a result of the turnaround. We tied in a number of new wells related to the implementation of eMSAGP. And as you will see in the release, we had very strong production in July, over 98,000 barrels a day, with again individual days that exceeded 100,000 barrels. Concurrently, we're increasing our production guidance for the year to 87,000 to 90,000 barrels a day, while lowering our non-energy operating cost guidance by 5% to a range of $4.50 to $5 per barrel. With respect to the turnaround, we safely completed the largest turnaround in the Company's history. It was accomplished over 33 days versus the budgeted 35. Major turnarounds of this nature are mandated every four years, as we have to get into some of the bigger pieces of equipment. Typically we would conduct smaller maintenance turnarounds on an annual basis. And this year was the first large turnaround on Phase 2B, which confirmed the integrity in the plant and no major issues were identified. During the course of the turnaround, we took the opportunity to tie-in 2B brownfield equipment such as the mechanical vapor compressor and drum boilers which will come onstream next year, and to modify existing equipment to support the higher levels of production that we are currently seeing. Financially, our adjusted funds flow from operations were $18 million in the quarter or $0.06 per share. Higher crude oil prices were offset by one-time factors, which included lower production volumes with the turnaround at Christina Lake and a $14 million cash impact from mark-to-market unrealized cash-settled stock-based compensation. And I would note, the stock on the quarter was up approximately 140%, which resulted in obviously a significant change to our accruals for stock-based compensation. We had $89 million of realized hedging loss on crude oil derivatives as commodity prices improved, and I'll comment more on hedging in a minute. Coming out of the quarter, we expect cash flow for the remainder of 2018 to be much more robust, as we put these one-time factors behind us and as production has ramped up for the remainder of the year. On capital, our year-to-date spending has been $338 million. Subsequent to the end of the quarter, we completed all spending related to Phase 2B eMSAGP implementation. That project came in at $340 million, below our revised estimate of $350 million and well below our initial estimate of $400 million. As Jeff mentioned, we continue to find opportunities to implement lower capital costs and we are consequently reducing our 2018 capital cost guidance from $700 million to $670 million. Turning to hedging, our hedging philosophy over the past two years has been focused on protecting our capital program primarily and our cash position. Hedges were executed at prevailing strip commodity prices based on the outlook at the time. We have had a sizable 2018 hedging program that was necessary given where the capital program was and relative to commodity prices on our balance sheets at the time prior to the sale of the Access Pipeline. With our current cash reserves, with higher commodity prices, and with lower anticipated levels of capital spend going into 2019, the Company anticipates we'll hedge a substantially lower percentage of our barrels going forward. And you'll see in our materials we have placed some hedges for 2019, at this point a fairly modest amount, and certainly we would not anticipate to hedge the same levels that we did last year. Turning to marketing, lower volumes because of the turnaround and continued apportionment on Mainline impacted sales and pricing in second quarter. We expect that apportionment will continue through the third and fourth quarters, perhaps reduced at the margins as real volumes ramp up and perhaps reduced in the short term due to refinery turnarounds. Enbridge's ongoing efforts to improve the efficiency of the nominations process would be a positive for us and would allow us to use more of our 50,000 barrels a day Flanagan capacity and take advantage of much stronger pricing on the U.S. Gulf Coast. Continued declines and ongoing geopolitical risk in Latin America translate to strong demand and strong pricing for Canadian heavy crudes on the U.S. Gulf Coast. Net of pipeline transport, netbacks are anticipated to be $10 to $15 better than sales at Edmonton. We're maximizing deliveries to that market, including some rail. Until apportionment changes, we anticipate we would deliver similar Flanagan volumes as we did in the second quarter, and we released in our press release our volumes for second quarter at 32,000 barrels a day. Rail movements in the second quarter were modest with the levels of production that are ramping up into third quarter. Netbacks from our rail sales will be similar to Edmonton sales. With respect to the Edmonton sales, we have substantial assets in place to mitigate the impact of apportionment, which include tankage and rail loading capacity. Nonetheless, at levels of apportionment higher than 30%, a small proportion of our production gets sold into a post-apportionment market, which has a negative impact on realizations. Medium term, it's our expectation that a combination of rail, a change in the Enbridge nomination process, and Line 3 completion will allow us to take much more advantage of the Flanagan capacity we have, which doubles to 100,000 barrels a day by mid-2020. So, just summing up with some forward-looking remarks, the turnaround is behind us. We're very focused on exiting the year at 100,000 barrels a day or above 100,000 barrels a day. Our full production for the remainder of the year translates into much better levels of cash flow. We're expecting to exit the year with a significant portion of the cash we currently have on hand and an undrawn revolver and excellent liquidity. We're well on our way to implementation of a fully-funded Vision 20/20. The majority of our capital going forward will continue to be directed at Christina Lake, and in the short term towards the 2B brownfield expansion where we anticipate capital spending will be completed in the second half of 2019, leading to production gains to 113,000 barrels a day by early 2020 and contributing to ongoing significant deleveraging of our balance sheet. By that time, we expect to be enjoying the benefits of our full capacity to the U.S. Gulf Coast. As Jeff mentioned, we have a highly competitive cost structure. Taking into account both OpEx and G&A and including energy costs, our costs are in the order of $8 a barrel. We continue to look for opportunities to improve on that. And so, to conclude, we believe this is an excellent time to welcome a permanent CEO who will complete the execution of this plan and take us beyond that into the future. And with that said, I'll turn it back to John.
John Rogers: Thanks, Jeff and Harvey, for your remarks. Obviously, we're pretty pleased to be through the second quarter with the impact of the turnaround and really looking forward to the third and the fourth quarter of this year as we enjoy the higher levels of production. With that, we are going to open up the lines for questions. I would like to ask if we could keep the questions to a strategic nature. Helen and I will be around post the call to answer your detailed modeling questions that you may have. So, we'd appreciate that we keep it at a strategic level and really honor everybody else on the phone lines today. So, with that, Chris, why don't we open it up for questions?
Operator: [Operator Instructions] Your first question comes from Neil Mehta, Goldman Sachs. Neil, please go ahead.
Neil Mehta: So, I want to start a little bit on the CEO decision and the timing around the succession planning. So, can you spend a little bit of time talking about when we can expect sort of the announcement and also the criteria that you're looking for at this point?
Jeffrey J. McCaig: Sure, Neil, it's Jeff McCaig. As I mentioned in my introductory remarks, we expect to be able to announce our new CEO sometime this month. We've made very good progress. We are very happy with the response to our initial casting a very broad net. We've completed the short-listing, we've completed the interviews, we're down to making a decision here which we expect we'll be able to do, as I said, sometime this month. The criteria for our new CEO, as I mentioned again in my introductory remarks, is that we were looking for someone with a deep knowledge of our business and the markets that we sell our products into. We were looking for someone who has proven operating experience and a successful record of focusing on the efficiency of our business and cost containment. We want someone who has vision and we want someone who has the ability to think strategically. And then finally, as I mentioned, we want to have someone in our CEO seat who is a disciplined allocator of capital.
Neil Mehta: Got it. I appreciate that and thanks for the update around capital spending. As we think post 2018, how do you think about what the right level of CapEx is for the business, let's call in 2019 and 2020, at a forward curve type commodity price environment?
Harvey Doerr: It's Harvey. I think obviously we go through a process towards the end of the year to define our capital budget and we haven't completed that work. But I think on a run rate basis, if you look at our modeling going forward, it's probably in the order of $500 million per year, something in that order, to execute on the plans that we currently have.
Neil Mehta: 2 Okay. And then lastly on WCS, thanks for the comments around apportionment, just curious on your views, for the balance of this year into 2019 and then again in 2020, how do you see this spread playing out? I would think that the balance of this year could be tricky given turnarounds, 2019 theoretically you should see rail pick up, and then 2020 you have competing factors of Enbridge Line 3 and IMO 2020. But just how do you think about the glide path around those differentials given that you are in the market would be helpful.
Harvey Doerr: Sure. So, I think we think there is going to continue to be a bit of volatility on sort of a number of factors as you see that affect it either way. And certainly going into fourth quarter here, particularly with refinery turnarounds in the short term, there's going to be a fair bit of oil trying to find markets. So, the widening that we're seeing right now is not too unusual. We would expect that to continue for sure to some extent through the end of the year. I think rail and those sorts of things will help, but it's really hard to forecast how quickly that comes on. Now the forward market has it pegged in the low 20s, even as far out as into 2020, and we've got hedges in place in the low 20s for a small portion of our volumes next year. We think that's probably kind of the right number. It reflects the effective cost of rail transportation to the U.S. Gulf Coast and we think that's where the price gets set. And so, until we see better egress out of the basin, there will be some seasonal volatility, there will be some event volatility, but the low 20s is probably a good planning case.
Neil Mehta: Why do you think we haven't seen more of an uptick in rail at this point?
Harvey Doerr: I think it basically relates to the tension between the rail companies who want to make longer-term investments and don't want to do that for short periods of haulage. I think that's the primary reason and there's sort of a process of discovery going on to find out what the right balance is between those two. But we do think it will ramp up. It has to ramp up. That's the way barrels are going to clear this basin.
Neil Mehta: All right, thanks guys.
Operator: Your next question comes from Phil Skolnick, Eight Capital. Phil, please go ahead.
Phil Skolnick: Just on the strategic review process that was mentioned earlier on, what prompted that and what all is looked at, like was sale of the Company an event that was looked at potentially?
Jeffrey J. McCaig: The Board is actively engaged in the oversight of strategy and its development by management as part of the normal course of our cycle, and we felt that it was a particularly opportune time at an inflection point in the business where we're transitioning from a founder CEO to a new CEO to a step-back review of strategy, and it would inform a number of things, not the least of which the kind of individual that we'd be looking for as the new CEO to take the business forward. So, it was an opportune time to do more of a step-back review, and Harvey got immersed into that immediately. And maybe Harvey, any other comments you'd like to make in response to that question?
Harvey Doerr: No, for sure it was a great exercise, it was a great exercise for me to really have an opportunity to interact with the senior management here, quick learning curve. So, it was a good exercise.
Phil Skolnick: Okay. And just a couple of more questions. One, was the 32,000 barrels a day that went down at Gulf Coast, was that all on Flanagan South and Seaway?
Harvey Doerr: Yes, that's right. So, yes, if you think about – I mean if you apply the apportionment in the quarter to our capacity, you'd see we shouldn't have quite got that much down the pipe, but we do a little better than what you would anticipate, and that's kind of a structural ability that we have to move a few extra barrels. But that was our Flanagan South shipment for sure.
Phil Skolnick: Okay, great. And then the final one, with respect to the modification that you did during the turnaround and how it's helped us from a reliability, could that potentially provide some kind of production creep going forward, especially on the Vision 20/20 goal?
Harvey Doerr: Yes. So, our guys are actively testing all the time the capacity at that plant, particularly in the treating and water handling areas, its ability to handle additional volumes. And we always seem to find little opportunities here and there to squeeze a little more through. It's kind of like the refinery. There's always debottlenecking opportunities and of course that prevents us from exposing the capital that we require to add additional kit, if we can get a little more through the kit we have. So, they've done a great job with that and there is ongoing testing now to sort of define what happens after 113,000 barrels a day.
Phil Skolnick: Okay, great. Thanks a lot.
Operator: Your next question comes from Matt Murphy, Tudor Pickering Holt. Matt, please go ahead.
Matt Murphy: On the rail side of things, I believe you guys had previously talked about moving 30% to 35% of your sales volumes. Just wondering if that's still the expectation over the remainder of 2018 and into 2019?
Harvey Doerr: We currently have rail loading capacity that's less than that. It's in the order of 25,000 to 30,000 barrels a day. And I think, notionally, that would be a reasonable goal, but we're certainly not there today.
Operator: Your next question comes from Joe Gemino, Morningstar. Joe, please go ahead.
Joe Gemino: Can you talk about your capital spending over the next couple of years as you look to bring out additional production through your brownfield Christina Lake project?
Harvey Doerr: Yes. So, again, I think for us, our business plan, which gets us through Vision 20/20, 113,000 barrels a day, contemplates capital spending in the order of $500 million a year for the next couple of years, and that would be I think a reasonable run rate to assume for now. We do have other projects in the queue that we could look at, but at this point in time, those would be for future growth further down the road. At this point in time, I think $500 million is a reasonable number.
Operator: Your next question comes from Paul Chambers, Barclays. Paul, please go ahead.
Paul Chambers: Going back to the change in hedging philosophy, lower percentage of barrels going forward, I'm just curious when you think about how volatile WCS diffs have been and the potential 2020 and beyond for that Mayan pricing to be impacted as well, you previously stated you thought a good range was in the low 20s. The hedging philosophy, is it changed for the way you approach hedging your diffs as well?
Harvey Doerr: I think the biggest trick with that is that you don't want to get ahead on either WTI or on diffs. I think you have to have a reasonable balance, and that's a bit of a crux we got caught in this year where we had more WTI hedges and WCS hedges. And if one of those goes the wrong way, there's an inter-relationship usually between the two, so we're really focused on making sure that we balance those two appropriately. You wouldn't want to be in a situation where you locked in $25 differentials and had WTI drop to $50. I mean those are the kinds of things that you have to worry about. And so, I think we think about those. I mean, we do look, we have looked forward at what the quotes are for 2020, and they are interesting in that they continue to reflect levels that we would expect. And so, at the end of the day, the problem is, if you try to hedge too far out, you're facing $10 backwardation in the WTI curve, and that's a hard thing to swallow.
Paul Chambers: Okay, great. Thanks for those comments. And then, a follow-up, going back to the strategic review of the HI-Q technology, where you've hired an outside bank to possibly monetize it, is there any sense for, if successful, what that could mean to annualized CapEx, is there a range or any impact you can share?
Harvey Doerr: I think the challenge with HI-Q is that the implementation of a partial upgrading would be a big capital bite, and we've just got so much opportunity to invest capital profitably at Christina Lake and ultimately beyond that at some of our other properties, chances are we wouldn't want to pursue that with the capital from this organization. And part of our motivation and thinking about HI-Q is, how do we drive that program forward. We really haven't been able to advance it since 2014 as an organization, and as much as I'd love to see the technology work, because it would have a significant impact on daily requirements and pipeline volumes requirements and access issues and maybe open up some new markets, it's probably not for us to be funding with our balance sheet. And so, our sense is that the advantages would come if we had access to it in terms of the markets we could access, and we'd be more interested in a throughput arrangement in a facility than we would be in investing our own capital in it.
Paul Chambers: Okay, great. Then, I guess lastly for me, from a strategic standpoint, you highlighted $65 oil over the next 18 months, net leverage between 2 and 3. At that price level, I mean are there other then opportunities for growth capital, essentially other expansion opportunities within the portfolio that you'd consider then at that price?
Harvey Doerr: There certainly are lots of opportunities. I mean the way I think about it is Christina Lake has capacity for 210,000 barrels a day. We've just scratched that and we're halfway there. And beyond that, we've got other properties that effectively are another Christina Lake or two, and that we think are high quality and deserve to be developed and deserve capital. But we're going to remain disciplined about our balance sheet over time and make sure that we don't find ourselves in the circumstances we found ourselves in a couple of years ago where we had really more debt in the downturn than we should have. So, it really comes down to discipline.
Paul Chambers: Great. Thank you for those colors.
Operator: Your next question comes from Tarek Hamid, J.P. Morgan. Tarek, please go ahead.
John: This is John in for Tarek. Appreciate you guys giving color earlier on WCS diffs. I was wondering about the apportionment process, how you guys arrived at that 32,000 barrel a day number? Could you just walk me through how that works?
Harvey Doerr: Sure. So, we have 50,000 barrels a day capacity on Flanagan, and we would on a monthly basis try and sell that much crude. But then our ability to move down the Mainline to Flanagan gets hit by apportionment, and so we can't actually hit the crude there. So, I mean I think the best way to think about it is to say, if you take the anticipated apportionment volume and multiply that times our Flanagan capacity, that's theoretically what we should get down the pipe, and we actually do a little better than that. I think if you back-test second quarter what we actually moved versus what the actual apportionment was, you could derive a relationship that would be a reasonable relationship for forecasting purposes.
John: Okay, very helpful. So, if there was no apportionment this quarter, theoretically how much capacity would you've had on Mainline?
Harvey Doerr: 50,000.
John: 50,000, okay. And then just moving on to your hedging philosophy, you guys touched on it earlier, it looks like you got a few thousand barrels per day in 2019, early 2019, hedged. Kind of what can we expect going forward, are those kind of levels where you want to be at?
Harvey Doerr: So, I think again, we'll hedge to the extent that we need to kind of protect our cash position next year and we're in a very healthy position. We had $560 million on the balance sheet at the end of this quarter. We expect cash flows will be significantly better going forward. And so, we expect to end the year with a significant chunk of that $560 million still on the balance sheet. With higher commodity prices, in order to get the level of protection that we need, we can hedge substantially less than half our volumes, I mean nothing near what we hedged last year and still get the level of protection that we need. And we haven't been as ambitious on that so far, because the market hasn't quite cooperated, and to go too far out, you give up a lot of backwardation in WTI right now. And so, the durations that we focused on have been kind of first half to a certain extent, not full year, at least for WTI. And again, we don't want to get too far out of balance on WTI versus WCS. So, hedging is a tough game, it's one you can never do really well by its – it's you do what you have to do to protect what you want to protect and try and give away as little of your upside as you can.
John: Okay, thank you. This is very helpful. And just lastly on your cash-settled stock comp expense, it looked like it was up pretty big this quarter. Obviously, the stock was up about 140%. If the stock were to theoretically stay where it's at today, what should we expect, should it be similarly in that range for the cash-settled portion?
Harvey Doerr: No, I think obviously there is two impacts on cash-settled stock compensation there. We had some tranches that were cash-settled in 2016 and 2017, and as the price rises, the liability associated with those goes up. And the other piece is that some of the PSUs are affected by TSR multiples, and so there is a compounding effect given that we had to assume that our relative performance would be better than what we would've had in our models at that point in time. So, there was a bit of a double whammy. And I don't know if John wants to elaborate on that.
John Rogers: Clearly, what happened is the strength of the stock in the second quarter really caused the adjustment that we had to make in the second quarter. So, I mean we do try to smooth it out by accruing throughout the year, but when you have such a large surge in the stock in that period in the second quarter, you're going to get that kind of adjustment.
John: Okay, thanks guys. That's all for me.
Operator: Thank you. There are no further questions at this time. Please proceed.
John Rogers: Thanks everyone for listening in to our quarter. We really appreciate it. We're obviously pretty excited about what is to come over the next remaining quarters and into 2019 and into 2020. So, obviously, hopefully you're kind of walking away with that kind of sense. Helen and I will be around after the call too, if you have any of those detailed questions. We wanted to thank everyone for not asking modeling questions on the call, but we'll be happy to answer them after. Other than that, everybody have a good day, and I'm sure we'll talk to everyone soon. Bye now.
Operator: Thank you. Ladies and gentlemen, this concludes your conference call for today. We thank you for participating and ask that you please disconnect your lines.