Acacia Research Corp (ACTG) 2010 Q3 法說會逐字稿

Good afternoon, and welcome, ladies and gentlemen, to the Acacia Research Third Quarter Earnings Release Conference Call.

At this time, I would like to inform you that this conference is being recorded and that all participants are in a listen-only mode.

At the request of the Company, we will open the conference up for questions and answers after the presentation.

I will now turn the conference over to Mr.

Paul Ryan.

Please go ahead, sir.

Thank you for being with us today.

Today's call may involve what the SEC considers to be forward-looking statements.

Please refer to our 8-K, which was filed with the SEC today, for our forward-looking statement disclaimer.

In today's call, the terms "we," "us" and "our" refer to Acacia Research Corporation and its wholly or majority-owned operating subsidiaries.

All intellectual property acquisitions, development, licensing and enforcement activities are conducted solely by certain of Acacia Research Corporation's wholly and majority-owned operating subsidiaries.

With us today are Chip Harris, President of Acacia; Dooyong Lee, Executive Vice President; and Clayton Haynes, our Chief Financial Officer.

Today, I will give you an overview of the progress we're making in building the business, and Clayton Haynes will provide you with an analysis of our financial results.

We will then open up the call for questions.

Acacia had a great third quarter.

It was our best quarter, so far, as we continue to build our leadership position and patent licensing.

Acacia had record quarterly revenues of $63.9 million, record GAAP net income of $24.7 million, and record trailing 12-month revenues of $138.6 million.

We continue to grow rapidly in all of our key performance metrics.

For the first nine months of the year, we have generated $118.7 million in revenues, which is a 150% increase over the prior-year period.

We have accomplished this growth while also increasing our gross margins by 39% from 46% to 64%.

We have also increased our working capital since the beginning of the year by 153% to $91 million.

We have also significantly increased the diversity of our revenue base this year as we generate revenues from a larger number of our patent portfolios.

Year-to-date, we have generated revenues from 52 different patent portfolios compared to 25 last year, an increase of 108%.

Importantly, we have generated initial revenues from new licensing programs this year to 27, an increase of 237% over last year.

We continue to increase the rate of acquiring control of new patent portfolios for future licensing programs.

Year-to-date, we have acquired 27 new portfolios, and we are on pace for another record year, which continues to increase the potential for future revenue growth.

Having built the leading outsource patent licensing company, Acacia is extremely well positioned as we see a major new trend of companies throughout the world deciding to generate revenues from their patents.

During the third quarter, Acacia generated revenues from 36 different licensing programs, including initial revenues from 12 new licensing programs.

New programs generating initial revenues in the quarter included two of our important wireless portfolios.

Our smartphone technology subsidiary, which controls smartphone inventions created by Access, Palm, Palm Source, Bell Communications, and Geoworks, completed initial license to Microsoft, which was reported on in an article in the Wall Street Journal a couple of weeks ago, in which I described this patent portfolio as foundational in the Smartphone market.

We also began generating revenues from our Celltrace subsidiary, which entered into initial licenses with Sprint, Spectrum, and US Cellular for patents relating to the use of short messaging and cellular telephony.

During the quarter, we also entered into three new licensing agreements with IBM, two new agreements with Phillips Electronics, and settled litigation with Red Hat.

On the business development front, we recently issued a joint press release with Renaissance Electronics that we have entered into a strategic patent licensing alliance with Renaissance, the world's third-largest semiconductor company, which has a portfolio of over 40,000 patents.

Renaissance Electronics is a Tokyo Stock Exchange listed company with over $14 billion in annual sales, which has been formed by Mitsubishi, Hitachi, and NEC.

We have commenced initial licensing programs of Renaissance patent portfolios and have already begun generating revenues.

During the quarter, we also announced that we have formed the Acacia intellectual property fund, which has a $27 million initial funding commitment and is authorized to raise up to $250 million.

This fund will give us the flexibility to access external capital to fund certain patent acquisition activities and licensing activities.

I thank all of the talented and very hardworking people at Acacia for another great quarter as we continue to build a great reputation as the premier patent licensing company.

Acacia is beginning to benefit from two major trends, which are impacting our business.

The first theme is the rapidly growing interest of large countries in the US, Europe and Asia and generating revenues from their patent portfolios to earn a return on investment from their R&D and M&A activities.

As the number-one outsource patent licensing company, having built a great track record in licensing, we are seeing many new opportunities as large companies seek to generate financial returns from their patents.

Acacia's business model makes sense for companies that want to generate these returns without having to make any additional investments of capital or human resources to earn those returns.

Acacia's corporate IP partners are recognizing that we have built a highly specialized company for patent licensing, and that there are significant advantages to outsourcing this activity to us.

They increasingly recognize the value of our multidisciplinary teams that can screen large patent portfolios for licensing opportunities, our due diligence teams that can validate licensing opportunities, our broad partnering relationships with leading law firms for enforcement, and the proven track record of our licensing teams in generating revenues.

We continue to see a significant expansion of our business from these IP partnering agreements with large companies.

The second major trend that is beginning to impact our business is the growing interest of large companies and entering into structured agreements that will enable them to in-license patent portfolios from us.

Companies are deciding that it makes economic sense for them to enter into structured agreements with Acacia that will facilitate periodic licensing negotiations and licensing renewals and reduce litigation.

This trend is being driven by the scale we are building in total patent portfolios, the accelerating growth of our intake of new portfolios, and the increasing depth and quality of many of our new patent portfolios.

This trend could benefit Acacia and our IP partners by shortening the time to money, reducing legal expenses and continuing to improve profit margins.

And, with that, I would like to turn the call over to our Chief Financial Officer, Clayton Haynes.

Thank you, Paul, and thank you to everyone joining us for today's third quarter 2010 earnings conference call.

As indicated in today's earnings press release on a consolidated basis, Acacia reported record third quarter 2010 revenues of $63.9 million as compared to $16.2 million in the third quarter of 2009.

Third quarter 2010 revenues included license fees from 51 new licensing agreements covering 36 of our technology licensing programs as compared to 36 new licensing agreements covering 18 of our technology licensing programs during the comparable prior-year quarter.

For more details, please refer to today's earnings press release for a summary of technology licensing programs contributing to revenues during the quarter and a summary of technology programs generating initial license fee revenues during the quarter.

We continued our trend of revenue growth with consolidated trailing 12-month revenues totaling $138.6 million as of September 30, 2010, as compared to $90.8 million as of June 30, 2010, $67.3 million as of December 31, 2009, and $65.7 million as of the end of the prior-year quarter.

Currently, on a consolidated basis, our operating subsidiaries have generated revenues from 87 of our technology licensing programs up from 56 technology licensing programs as of the end of the comparable prior-year quarter.

License fee revenues continue to fluctuate from period-to-period based on the various factors discussed on previous earnings conference calls and in our periodic filings with the SEC.

For the third quarter of 2010, Acacia Research reported record net income of $24.7 million, or $0.75 per share and $0.70 per fully diluted share versus a net loss of $3.4 million or $0.11 per share for the comparable prior-year quarter as illustrated in today's press release and related 8K filed with the SEC.

Excluding the impact of noncash patent amortization charges and noncash stock compensation charges, we reported third quarter 2010 net income of $28.3 million, or $0.80 per fully diluted share as compared to approximately breakeven, excluding noncash items, for the comparable prior-year quarter.

Our average margins defined as gross license fees less inventor royalties and payments to non-controlling interests and contingent legal fees for the portfolios generating revenues during the period, was approximately 57% for the third quarter of 2010 as compared to 41% for the comparable prior-year quarter.

Average margins continue to fluctuate period-to-period based on the mix of patent portfolios that generate revenues each period, the terms and conditions of license agreements executed each period, and the related economics associated with the underlying and venture agreements and contingent legal fee arrangements, if any.

Inventor royalties expense of payments to non-controlling interest for the third quarter of 2010 increased 209% to $17.6 million versus $5.7 million for the comparable prior-year quarter, consistent with the related increase in revenues for the same periods.

Contingent legal fees for the third quarter of 2010 increased 156% to $9.7 million versus $3.8 million for the comparable prior-year quarter, again, consistent with the related increase in revenues for the same periods.

On a combined basis, inventor royalties, net income attributable to non-controlling interests, and contingent legal fees as a percentage of total revenues decreased to 43% as compared to 59% in the comparable prior-year quarter primarily due to lower inventor royalty rates and contingent legal fee rates, if any, for the portfolios generating revenues during the third quarter of 2010.

Third quarter 2010 marketing, general, and administrative expenses including noncash stock compensation charges increased to $6.4 million versus $4.7 million for the comparable prior-year quarter primarily due to an increase in variable performance-based compensation costs, an increase in stock-based compensation-related charges, state-related gross receipts taxes incurred on certain licensing revenues recognized in the third quarter of 2010 and a minor net increase in engineering and licensing personnel.

Third quarter 2010 litigation and licensing expenses decreased to $2.9 million as compared to $4 million for the comparable prior-year quarter.

Litigation and licensing expenses continue to fluctuate from period-to-period based on patent enforcement and prosecution activity associated with ongoing licensing and enforcement programs and the timing of the commencement of new licensing and enforcement programs in each period.

Looking forward, for fiscal 2010 we expect MG&A, excluding noncash stock compensation charges, to be in the range of approximately $17 million to $17.5 million, again, due primarily to increases in variable performance-based compensation costs and certain other variable general and administrative costs.

For fiscal 2010, we continue to estimate that patent-related litigation and licensing expenses incurred for 2010 will be between approximately $13.5 million to $14 million.

From a balance sheet perspective, cash and cash equivalents and investments totaled $85.6 million as of September 30, 2010, compared to $53.9 million as of December 31, 2009.

Working capital increased 153% to $91 million as of September 30, 2010, from $36 million as of December 31, 2009.

Net cash inflows from operations for the third quarter of 2010 totaled $14.2 million versus net cash outflows of $3.3 million for the third quarter of 2009.

Net cash inflows from operations for the nine months ended September 30, 2010, totaled $30.3 million versus net cash inflows of $5.9 million for the nine months ended September 30, 2009.

Again, thank you for joining us for today's third quarter earnings conference call, and I will now turn the call back over to Paul Ryan.

Thank you, Clayton.

Operator, can you open up the call for questions and answers?

Certainly.

(Operator Instructions) Mark Argento, Craig-Hallum Capital.

Congratulations on a another breakout quarter.

When we look at the two parts to the business, the base licensing business and then more the kind of structured license deals.

It looks like you did another one this quarter, which drove some pretty good upside.

I know you probably don't want to break out the two, but because it is so lumpy, could you give us some overall trends on the base licensing business separate from the structured licensing?

The size of the deals, maybe, and try to give us a little bit of color on that, if you could.

Well, if you look through the nine months year-to-date, the base licensing continues to move up significantly.

Most of the revenue has been generated from our base licensing programs and, to some degree, they will generate probably more and more of the structured deals where we periodically negotiate the licenses of multiple portfolios.

But when you really think about it, when we do these deals, we are basically licensing a number of our portfolios at one time to one company, which is part of our base licensing.

So it's really one and the same, quite frankly.

But they just happen to be -- generally, you get larger numbers when a company decides that it wants to take licenses to a number of portfolios that we control at the same time in the same quarter.

Right.

Can you talk a little bit more about these structured license deals?

I mean, are they, for a period of time, are they taking perpetual licenses for certain portfolios?

That's kind of how I've always understood.

There's kind of two flavors here.

Can you maybe give a little more color on that?

Well, it depends on the company and the structure.

We're going to have a variety of -- predominantly, the essential element is it rationalizes and makes more economic for both sides.

The licensing process gets more money to our IP partners because you tend to settle these with less litigation cost and less expenses of licensing.

So it's really beneficial to both parties.

So depending on the company and depending on their needs.

But, you're right, generally, there is a term.

And what they want to achieve is a periodic round of licensing negotiations much like large companies do with each other.

Although our timeframes are generally much shorter than is typically done in the industry because we want our IP partners, new IP partners, coming in and participating in the additional revenues from those renewals of those agreements.

So they take a variety of forms but, basically, in essence, it's a way for us and large companies where we have many portfolios that relate to them to enter into periodic negotiations and take licenses without litigation.

Sure.

I noticed on the balance sheet you have a pretty good-sized receivable.

When do you expect -- what are the terms historically in a recoup in your cap or getting your cash from some of these deals, going forward?

Actually, we have collected, of the receivables -- of $38.9 million, we have collected $37.6 million in the first 15 days.

So we've collected 98% of all that money is in the bank.

So a decent kind of current cash number is the $83 million that you had at the end of the quarter plus, roughly, another $37 million?

Is that -- ?

Yes, until we pay our IP partners.

Less the 43% margin on average.

Then you take the normal margins that we're achieving, and the splits that go to our IP partners.

But, yes, right now we have $85 million in cash plus the $37 million.

And during this month, we will be doing the payments out to our partners.

Got you, okay.

And then could you talk a little bit more about -- it seems to be, really, over the last nine months, in particular, just a really significant shift in the way large tech companies are viewing their IP.

And maybe you could just touch on it a little bit.

Clearly, it's benefiting you guys.

You're getting more deals done.

Do you see this persisting for a period of time?

Or do you think that -- how do you think about the opportunity, I guess, going forward, and where you're positioned today, and what do you need to continue to do to find success?

Well, in terms of the trend of large companies worldwide who decided to monetize their patents, we think we're at the very beginning of that process.

I mean, historically, there have been a couple of handsful of companies that have generated very large dollars from their patent portfolios, and increasingly we're seeing more and more companies, certainly in the dialogs we're in with companies plus the ones that we're hearing about in the marketplace.

So we think we're at the very beginning of a major trend of companies realizing that the patents that are on their balance sheet are the results of their investment in R&D with shareholder money.

And that they ought to be generating financial returns from those patents.

So more and more companies are adopting what I might call the "IBM philosophy." They were kind of the leaders in realizing that there is a lot more returns that can be generated for their shareholders from their R&D investment by broadly licensing out their patents to industry instead of just holding those patents defensively.

And I think as more companies have done that, and it's impacted their bottom line, there's more pressures on managements and boards to do the same thing.

So we think we're at the very beginning of this new trend.

And when you think about the -- I don't have the stat right in front of me -- but, you know, the number of new patent portfolios that you guys brought in in the quarter and so far this year.

And it's up, you know, I don't know, it's up 50%, 75% in terms of just total number of portfolios.

But just the number of portfolios is one statistic, but a more telling statistic, and this is hard to provide, I assume.

But you think about the size of these new portfolios you're bringing in like, of course, the one you signed with Renaissance, you know, what -- if you think about the new IP that you brought in this year, not just in the number of portfolio sets but the opportunity set there.

I mean, you know, the way we look at it, it's probably a magnitude of what you've had historically in the pipeline.

So have you doubled your market opportunity or tripled your market opportunity, do you think, with the new IP you brought in so far this year?

Well, I don't know if we want to put a specific number, because we have a lot of legacy IP that we think is very valuable.

But, certainly, there's no question that when you start partnering with companies that have 40,000 patents, you're moving in orders of magnitude in terms of sheer numbers of patents.

And we just think it's an increasing trend.

I wouldn't want to put a hard number, but, certainly, it's gone up dramatically, yes -- the value.

Last question, more of a housekeeping question -- in terms of the NOL, where are we and how much do you have left on your tax shields?

From an NOL standpoint, as of the end of fiscal 2009, we had approximately $86.4 million in federal NOLs and about $68.7 million, total, in state NOLs.

And where are we now?

Well, with respect to what the tax return is looking like for fiscal 2010, we've not done those calculations yet, but the 86 and the 68 are what is available as of the end of 2009.

And, so far, we've generated $38 million in profits, right?

Correct, correct.

So the two numbers -- we don't know what the exact taxes will be.

But starting the year, we had an $86 million NOL, and we've made $38 million this year.

So you can kind of do the math of where it would likely be.

(Operator Instructions) Jonathan Skeels, Davenport & Company.

Hey, guys, congrats on the quarter.

Can you talk a little bit about your confidence maybe in signing additional structured license deals and, specifically, can you talk about the interest level among companies in signing these deals with you?

Yes.

We had a goal at the beginning of this year of doing two.

Our goal for next year is three.

And, for the following year, four.

People have asked us why that pace?

And it's because we have some specific requirements in terms of the structure of our business, particularly relating to the length of the term of these licenses.

Some people in industry are used to longer terms, but it doesn't fit our business model.

So we've learned from our discipline on the business development side, where we've always done 50-50 deals with partners, and we've basically never broken that rate structure.

It's proving to be quite valuable now as we partner on larger portfolios.

So we think it's going to be important for us to maintain that same discipline in the number of term deals we do.

Because we're probably only going to do a dozen of these.

And, hopefully, the plan would be that they would renew, and you'd get three or four of them renewing for a year and give a lot more stability to the revenue base beginning each year.

So that's kind of the goal, and we think that's a reasonable timeframe.

We have interest from a lot of major companies, but it's always price and terms.

So -- that's our goal -- three for next year, four for the following year.

And then just -- when thinking about renewals, can you talk about, maybe, confidence you have that companies want to enter into these deals, and then they probably would want to stay in them longer term?

We can't predict that.

If it made sense for them this time around with our accelerated growth and new portfolios, if that trend continues, it would probably make sense that they would want to do it the same way at the end of the original term period.

But we have no evidence or experience with that yet.

Great.

And then on -- you started to monetize the Renaissance and the Access portfolios.

It seemed like the revenue ramp at Renaissance has been quick in there's very little litigation involved there, I guess, in signing your first two deals in the quarter.

Is this ramping as expected, or are you ahead of schedule?

Can you talk a little bit about that?

I think we're ahead of schedule.

We've had the ability in these partnerships.

Similarly, Access is a publicly traded company on the Tokyo Stock Exchange that had the original Palm Source patents along with patents that they have developed themselves, and Bell.

And, certainly, we've moved into the first large license of that portfolio to a major company.

We did that without litigation to Microsoft.

So, certainly, I think at this stage, both of our partners are very happy with the timing that we've done, and we've exceeded their expectations.

And how is the -- I guess -- the positive press you've been getting on these deals helping with other potential partners in both Asia and the US?

I guess these are good references for you in terms of acquiring some new business?

Well, certainly, the visibility of being in the press doing these kinds of transactions with large companies can only help our visibility there.

We're in discussions, our business development people are in discussions with a number of other large companies but, certainly, having favorable press doesn't hurt.

And back on the cash balance -- you have said you wanted to get to $100 million.

You're there.

Can you just update us on the strategy there?

And, in particular, if you're looking to possibly put capital to work, or put some of that cash to work, what kind of returns have you seen in the past when you've put up money?

Why don't I let Chip address that?

He gets asked that question a lot.

Yes, clearly, the cash balances have grown pretty dramatically over the last couple of years, as we have achieved profitability.

If you look at the three opportunities big companies have to do out there, I mean, they can build an in-house licensing company for the portfolios if they're thinking about monetizing their assets.

They can spin it off.

You've seen a big semiconductor company spin their portfolio off into a separate entity.

Or they can access companies like ourselves to be their in-house licensing departments.

The ability to have a strong balance sheet is clearly a competitive advantage that we have over companies that might consider themselves competitors of ours.

And to be able to put your money to work and, as you've seen our margins grow, we've been able to buy down back end participation to achieve the margin growth that we've talked about over the last couple of years.

You know, we used to be in the high 30s, low 40s.

We moved to the mid 40s to the mid 50s, and I think, on a year-to-date basis, we're over 60% now.

So capital will be used for a lot of things like that.

Psychologically, it's very compelling.

If we're going to have compete and show what we can do for big companies compared to what a supposed competitor might be able to do.

Okay.

And then on the IP fund -- when should we expect that to ramp?

And can you talk a little bit about what kind of opportunities you're seeing out there?

Well, we've got a couple of opportunities that we have under contract right now that fit the profile of the IP fund.

We think that there are some early signs that we're seeing earlier monetization in some of our opportunities.

Obviously, if we close on a couple of the opportunities, and we do some early licensing, you know, one can only imagine the early returns in the fund.

It does make it easier for us to attract additional capital if we need to, or if we find opportunities that kind of dwarf our balance sheet maybe.

Okay, and then, just, last one -- can you break out your largest licensees in the quarter?

Or is that something we'll usually see?

I think it's usually in the Q but -- ?

Yes.

We'll be providing that in the 10Q as far as the third quarter is concerned.

Bruce Stewart, Private Investor.

I don't have a question.

I want to say congratulations.

Well, thank you, that's easy to answer.

Thanks.

We have the answer to that one -- thank you.

And I want to thank the whole team for doing such a wonderful job.

Okay, thank you, Bruce, appreciate it.

(Operator Instructions) Walter Ramsley, Walrus Partners.

Great.

That's a tremendous set of numbers, I must confess.

And I do have a couple of questions, though.

So I'm not going to be that short.

The patent acquisition costs -- they were down in the quarter.

Is that going to be the ongoing trend now that you have the IP fund or what's the outlook there?

No, I don't think you can draw any conclusions from a particular quarter.

And that particular quarter in the fund -- the portfolios we've brought in, we do have capital, and if our IP partners line up for our payments, and we can buy more points, we will do that.

But in this particular quarter, there just weren't many of those opportunities.

It's not a trend.

Oh, okay.

Okay, and in the fourth quarter, I mean, you've indicated you don't really expect a structured deal to take place.

So if you don't get one, do you have enough so the base business going at this point can generate a profit?

I hope so.

Okay, good answer.

Anyway, congratulations.

That's a spectacular set of numbers.

Okay, thank you.

[Paul Berger, Hammock Investors].

Good afternoon.

Congratulations, guys, it was a good quarter.

Two items -- one, on the licenses you deal with, Oracle and Microsoft.

Can you give us a little color on about how many portfolios they took?

No, there's no -- the confidentiality agreements that we have generally prohibit us from discussing any specific terms of licenses or numbers of patents.

With any licensees.

Yes.

Okay.

And also is DMT dead now?

Or is there still any appeals left for it?

It's been in the appeal process.

We also have new patents that have issued.

Actually, we just had a new patent that issued this week.

There are three new patents that have issued in the portfolio.

We recently had a Fed circuit appeal, and the Fed circuit confirmed the lower court's decision that the five initial patents had indefinite claims.

We haven't made a final decision about any further appeals at this time, but that's the most recent event.

And that's occurred.

And contemporaneous with that, we've been getting some new patents issued, which generally now will go out until, I think, it's 2014, the spring of 2014.

So we'll make a decision on the licensing and enforcement of those new patents.

So for those people that you already have under license, and you had some that were continuing -- are they continuing to pay or is that on hold?

Actually, the practicality of it is the original patents expire in January.

So this would be the last quarter that people would be making payments under the original patents, anyway.

But by the time it's resolved, whether we decide to appeal the most recent decision or not, basically, the payments under the agreements would have been completed.

We have new life in these new patents, which would cover from the date of issuance until, roughly, the spring of 2014.

Do you see the same kind of potential for the new patents as you did at one time for the old ones?

A shorter life for licensing.

Obviously, the only revenues we could generate are for the life of the patent, which would be for that three and a half year period.

Not a longer period, which the original ones would have had a longer life.

But the market, obviously, has grown since then, and so from this day to 2014, obviously, there's a much larger market opportunity on an annual basis.

Okay, fine.

Thanks.

And, again, congratulations for a good quarter.

Okay, thank you.

Peter Norton, Norton Capital Management.

Good afternoon, gentlemen, and I will echo everyone else in saying congratulations on a phenomenal quarter.

The question I have relates to the cash that you discussed from the balance sheet, which is growing.

And, as I understand, the capital intensity of your business is rather low.

I'm wondering what the thoughts might be internally about the dividend or some sort of a stock buyback, et cetera.

Well, we see ourselves still as a growth company.

I think, through the second quarter, we had kind of annual growth of about 68%.

I think our treasury policy or function will be more in line with growth companies than mature dividend-paying companies.

There are actually growth companies that pay dividends?

Well, we might be one of them.

That's what I'm asking.

We don't have any policy on that.

We're early in this process here.

The corporate opportunities that we're seeing are kind of overwhelming -- the business development opportunities here, and we'll just have to take a look at when and if we deploy cash on larger opportunities we have in the past.

It's a little early without a lot of foresight into the future as what our revenues are going to look like to really start talking about a dividend or a stock buyback right now.

Okay.

Is there a number on the balance sheet, a cash number, that would trigger a decision to move in that direction or not?

Well, I think it's a function of what's on the balance sheet and the opportunities that we see in the near term, let's say in the next year.

So we have to kind of take a look at both of those and determine what's appropriate from a retention of cash.

This will conclude the question-and-answer session.

I will now turn the call back to Mr.

Ryan.

Okay, I want to thank you all for being with us on the quarterly call.

If you have additional questions, you can call either myself or Rob Stewart and look forward to talking to you on our next call in February.

Thanks.

Ladies and gentlemen, if you wish to access the replay for this call, you may do so by dialing 800-642-1687 or 706-645-9291 with the confirmation codes 10039317.

This concludes our conference for today.

Thank you for participating and have a nice day.

All parties may now disconnect.