Allient Inc (ALNT) 2017 Q1 法說會逐字稿

Thank you for standing by.

This is the conference operator.

Welcome to the Allied Motion Technologies conference call.

(Operator Instructions) I would now like to turn the conference over to Deb Pawlowski, Investor Relations.

Deb, you may go ahead.

Thank you, Kirsten.

And good morning, everyone.

We certainly appreciate your time today as well as your interest in Allied Motion Technologies.

Joining me on the call are Dick Warzala, our Chairman, President and Chief Executive Officer; and Mike Leach, our Chief Financial Officer.

Dick and Mike will review our first quarter results and provide an update on the company's strategic progress and outlook.

After that, we will open it up for Q&A.

You should have a copy of the financial results that were released yesterday after the market closed.

And if not, you can find them on our website at www.alliedmotion.com.

You will also find on the website, if you have not received them yet, the slides that accompany today's discussion.

If you are viewing those slides, please turn to Slide #2 for the safe harbor statement.

As you are aware, we may make some forward-looking statements on this call during the formal discussion as well as during the Q&A.

These statements apply to future events that are subject to risks and uncertainties as well as other factors that could cause actual results to differ materially from what is stated on today's call.

These risks and uncertainties and other factors are provided in the earnings release as well as with other documents filed by the company with the Securities and Exchange Commission.

You can find these documents on our website or at sec.gov.

I would like to point out as well that during today's call we will discuss some non-GAAP measures, which we believe will be useful in evaluating our performance.

You should not consider the presentation of this additional information in isolation or as a substitute for results prepared in accordance with GAAP.

We have provided reconciliations of non-GAAP to comparable GAAP measures in the tables accompanying today's earnings release as well as in the slides.

So with that, if you turn to Slide #3, I will turn the call over to Dick to begin.

Dick?

Thanks, Debbie.

And welcome, everyone, to our call.

We delivered a solid start to 2017 with strong bottom line growth despite moderately softer revenue over the first quarter of last year.

We achieved solid net income growth as a result of lower cost and the success of our refinancing last fall.

Interest expense declined $1 million compared with the first quarter of last year.

Our Aerospace & Defense market for the trailing 12-month period has provided increased revenue driven mostly by the Defense industry.

We are also seeing solid demand in our other markets such as Medical and Industrial/Electronics.

This activity has helped to mostly offset the decline in our Vehicle market, which has been impacted by weakened markets for particular OEMs and end of life in certain applications.

We demonstrated our ability to generate cash in the quarter and provided a strong operating cash flow yield.

We will utilize our cash to invest in growth both organically as well as through acquisition.

Organic growth includes E&D productivity enhancements that enable us to create capacity with our existing footprint and furthering our IT infrastructure.

We believe we have sufficient financial flexibility to fund growth and return capital to shareholders through our dividend.

Earlier this week, we announced that we have been awarded a customer-specific solution within our Vehicle market in Europe.

The project win was for a 7-year $90 million award that is expected to ramp up in 2020.

On an annual basis, we are expecting about $12 million to $13 million of revenue a year for this project.

This is a great win for our company and not only validates our strategy but demonstrates the strength of Allied Motion brand on a global basis and the recognition of our expertise for the application.

Our sales and project ramp-up cycles can be quite long, but this award provides validation of the progress we are making.

We believe our growth-driving investments in sales and technical resources are paying off.

With that, let me turn it over to Mike for the review of our financials.

Mike?

Thank you, Dick.

Please refer to Slide 4. Revenue was $61.4 million, down 3.6% in the quarter compared with the prior year period.

Excluding $1.1 million of unfavorable FX impact, revenue was down less than 2%.

Sales were up more than $6 million over the trailing fourth quarter.

As Dick mentioned, we had a strong quarter of sales in the Aerospace & Defense market and continue to grow our position in Medical.

Those gains were offset by the continued headwinds in the Vehicle market.

Sales to U.S. customers were 54% of total sales for the quarter compared to 55% in the same period last year.

Gross profit was $17.7 million or 28.9% of revenue compared with $18.5 million or $29.1 million of revenue at first quarter of last year.

The modest decline was due to lower volume, product mix and underabsorption of cost in certain production facilities.

Slide 5 provides detail on our operating performance.

Operating income was down $395,000, and operating margin was 7.1% for the quarter compared with 7.5% last year.

Our operating cost declined 3% from the same period last year, mainly driven by 10% lower G&A expenses.

This reflects both lower incentive and deferred compensation cost as well as disciplined cost management.

Our growth focus in investments in E&D and technical and sales resources were up in the quarter.

E&D was 6.8% of sales, and selling expenses were 4.2% of sales, both up about 40 basis points over last year.

We previously discussed our new debt facility that was completed in the fourth quarter last year that has considerably reduced interest expense and increased our ability to support organic and acquisitive growth.

Slide 6 provides an overview.

Our new $125 million facility was used to refinance the $30 million, 14.5% senior subordinated notes and $40.5 million outstanding on the company's previously existing revolving credit facility and term loan.

Given the lower cost of debt with the new credit facility, interest expense decreased measurably in the quarter to $523,000.

5% to 7% net income, which was up nearly 13% to $2.7 million.

On a diluted per share basis, net income improved 16% or $0.04 to $0.29 a share.

The effective tax rate in the quarter was 31%, and we anticipate our effective tax rate for 2017 to be approximately 29% to 32%.

We use adjusted EBITDA as an internal metric and believe it's useful in determining our progress and operating performance.

This is a non-GAAP measure, so please be advised to review our reconciliation and related disclosure in our release and at the end of the slides.

For the first quarter this year, adjusted EBITDA was $7.3 million or 11.9% of sales, which compares with 12% last year.

Slide 8 provides an overview of our balance sheet and cash flow.

We ended the quarter with a cash balance of $14 million.

Cash from operation was $2.3 million.

And over the trailing 12 months, we generated $23.5 million in cash from operations.

Debt was reduced approximately $3 million in the quarter to $68.5 million.

Debt net of cash was $54.5 million or 41.6% of net debt to capitalization.

Capital expenditures were $1.3 million.

We expect our 2017 CapEx to be somewhat similar to 2016, at approximately $5 million to $6 million.

Inventory turns improved 4.9x in the quarter compared with 4.3x at year-end 2016.

Our DSO was 44 days, consistent with 2016.

I'll now turn the call back over to you, Dick.

Thank you, Mike.

We'll now turn to Slide 9. We had solid orders of $60.5 million in the quarter, which is an improvement over the trailing fourth quarter.

Year-over-year, like the trends in sales by market, our Aerospace & Defense market drove orders, which helped to offset the weakness we have been discussing in our Vehicle market.

As we have discussed in the past, we have several new multiproduct motion-control solution wins that will begin to ramp into production later this year and into next year.

We continue to leverage Heidrive standardized product platform to offer market-based applications, which are better suited to serve a broader distributor/agent channel to market.

In early April, we launched our high-motion Servo product line in North America at the Automate show in Chicago.

While still early, feedback has been positive.

We expect this product line, along with other system and solution enhancements around control and drive offerings, to create additional sales opportunities in the future.

We are building a pipeline of opportunities for well into the future.

Our integrated solution capabilities gives us a competitive advantage and are providing a large foundation for our future.

We believe this substantiates the strength of our value proposition and enables us to develop more successes in our served markets.

We will continue to search for strategic, additive acquisition opportunities, which can expand our capabilities, extend our geographic reach and add new customers.

As we have demonstrated, we will be consistent with a prudent and strategic approach to any future acquisitions.

With that, operator, let's open the line for questions.

(Operator Instructions) Our first question is from Greg Palm of Craig-Hallum Capital Group.

It's Greg here.

So I wanted to start out with Q1, and the results bounced back nicely here compared to Q4.

So was kind of hoping you could run through the various puts and takes.

How much of that increase was due to maybe stabilization or improvement in the end markets versus maybe a ramp from some of these new awards that you've been talking about lately?

Sure.

All I would say to you is that when we talk about stabilization in certain markets that we continue to see strengthening, as we've mentioned, in the Defense market, in the Medical market.

And we had also in Industrial/Electronics we see some good growth opportunities.

It's primarily the Vehicle which continues to challenge us.

And as we talked in the past -- excuse me, I have a little sore throat here.

But as we've talked in the past, our Vehicle market is made up of a broad-based number of customers and different applications.

While we've seen headwinds in one particular one that we service, we also experienced end of life in the automotive section of our Vehicle business.

So I would say to you that it is the other markets that are driving our growth, and it is the headwinds that we have to combat here in certain applications in the Vehicle market.

That's unchanged.

Now if you're asking about stabilization, stabilization in the Vehicle markets from the standpoint of are they back at the levels that we saw in the past?

The answer is no.

Are they continuing to decline?

I would say to you they're not continuing to decline, but there's still a little bit of uneasiness in the market, as the channel seems to have inventory that still needs to be utilized.

So I'm not going to sit here and say that it's totally stabilized, but I would say to you then, it's gotten much better.

Got it.

That's good color.

As it relates to Aerospace & Defense, are those -- what's causing the strength there?

Those new awards?

And then as it relates to the new awards, can you talk about any of the contribution from some of those new awards that sort of are ramping over this year's -- this year's time frame?

Well, I don't think, Greg, that we've really talked about in the past the actual awards.

And for the first time, we went out and we've announced that we had a major award in the Vehicle segment.

But we do have several opportunities, and some have been converted.

But these -- I would call them much the same in a normal course of business.

We discussed these applications that we've been working on, multiview product solutions.

Yes, they're there.

Yes, they're ramping.

And I would say Defense is fairly strong right now.

So -- and we've seen a bump in demand of base products in the Defense area, and it seems to be across the board.

Got it.

That's maybe a good segue into my next question, which is on that new win.

Congrats on the announcement.

Not sure what you can talk about there in terms of details, but is that a new customer?

It sounds like that is kind of one of the newer multiproduct solution wins.

Just kind of curious how did that relationship evolve?

And any other details that you can share would be useful.

It is a new customer.

And it is a -- it's technology that we have in the company that we have made continual improvement on.

And I think, Greg, you were at the Automate show in Chicago, we discussed there a little bit about our willingness after prompting from investors and the analysts about maybe making people more aware of how are things going with regards to the pipeline we're working on.

And I said to you then I was fairly confident that we'll be converting some of these in the near future.

And I'll tell you that, I think, we have more to come.

It's not a one and done.

It's actually pretty exciting.

And I think we're very well focused on the target.

We have a good solution.

We're getting traction.

And I think we're looking at if we can gain more traction on a global basis.

So without going any more details, yes, it's a new customer.

It is a relationship that comes from a prior application we were working on.

And as I said, I think there's more to come here in the future.

We'll be looking forward to hearing more announcements.

I guess, just lastly, can I -- big picture, if you sort of look at -- some of this relates to kind of the new line of products that you launched at that trade show.

But if you look at your sort of addressable market opportunity, what sort of newer markets are you most excited about in terms of opportunity, maybe some new markets that you historically haven't played or participated in the past?

Well, I think that's the interesting part.

I think what we're looking at here is, as I mentioned to you before and others before, is that we subset segment internally to a great extent.

So we look at markets; we look at field of application.

So when we have a success in a particular application, we will look at it other customers that need the same type of solution.

And then as we exhaust that list and when you start calling on that list of customers, then we also look at how we can apply that solution in other areas, other markets, other applications.

And that's a constant -- it's an ongoing process that we have internally in the company.

And I think what I can say to you is that we've had several multiproduct TU wins here.

And as they have -- as they've ramped into production or come into production, I think the exciting part of the product side that we've developed is not only going to develop new opportunities for us it's going to allow us to retain the existing customers and existing customer base.

We were not an electronics company.

I can rattle off -- but I'm not going to.

But I could rattle off 6 or 7 different new customers that we secured based upon the electronics that we're bringing into market.

We have already an additional electronics we bring to market.

We've seen some fairly significant growth in that area with our start-up.

And as I talk about markets, I mean if we look at our Medical it's -- on a trailing 12 months, it's up 14%, okay?

Industrial/Electronics is up 24%.

Aerospace & Defense -- I'm sorry, not up.

I'm giving you our shares.

It's up -- it's 14%, 24%.

Our Vehicle is 46%.

So that's down, what used to be 55%.

And our Aerospace & Defense is 12%, and our year-over-year growth here in Medical is 62%.

Industrial/ Electronics is 12.

Vehicle is down 12 and Aerospace & Defense is up 33%.

So that's a lot of more color than we've given in the past.

But it shows you that we clearly have growth opportunities in these other markets.

And they -- that, I think we can speak to those markets that are combination of our multi-TU solution and electronics is what's driving that.

So it's the headwinds that we've met in the Vehicle market that I think is not carrying through to show the true growth and the successes we're having within the company.

And certainly, we're working hard to solve that.

And then talking about the wind that we did have in the Vehicle to offset some of that, I think will give you some additional color on that.

Our next question comes from John Walthausen with Walthausen & Company.

I guess, again, on the substantial order, which you announced.

Can you comfortably say that it was achieved because of technology that you brought to it that gave you a solution which was demonstrably better than other folks were able to present?

I'm not going to go that far.

I wouldn't say that -- when you look at the -- what customers are looking at for us to provide and the solutions, certainly the technology has to meet their needs,.

You have to be cost competitive.

And I think more importantly, they're looking at quality, and they look at your on-time delivery schedule.

So our technology is up to par and certainly satisfies their needs.

And maybe we have a slight advantage, but I'm not going to go far and say we have a significant advantage.

But when you look at our track record of on-time delivery and quality, I think that sets us apart.

Okay, that's very helpful.

The second, looking at the numbers quickly, I noticed that for a couple of quarters we've seen with inventory go up meaningfully.

That seems contrary to your lean manufacturing.

Can you talk about why that's happening?

Well, I think you've got the addition of Heidrive from an acquisition standpoint in the mix over the past year, which certainly they're our highly customized shop versus high-volume shops.

So that adds to the mix.

The other factors is in terms of -- we've talked about the headwinds we face in the Vehicle market.

And within the Vehicle market, the automotive market, just the interplay of that reduction across our inventory tends to raise our turns.

And just a mix of our inventory that -- the Vehicle market tends to be a very high-turn, high-quick-paced activity market relative to inventory.

And then the reduction in that business relative to the rest of our business just kind of makes this pop out a little bit.

As we move forward, we should probably expect the percentage of customized work to be higher than it has been.

Is it the correct understanding?

Well, John, I would say to you that there's 2 things that -- there's 2 paths that we're taking here.

We've been very successful on customer-specific applications, especially those applications where it's a combination of multiple technologies.

And we're able to give them a very cost-competitive, performance-based solution in a very small package.

And I think that's what sets us apart from our competition.

And you look at our solutions, we're embedding electronics in many of our future designs and I'll say the majority of our future designs and major opportunities we're working on today.

And also, it's this platform development that we're working on to go look at market-based solutions, which as we develop a new market-based solution, that should drive the inventory, the whip, down because it's the customer specific with long lead time that you're really required to carry certain inventory for.

And in a market base where you can plan it and you've got your -- and you're sharing it across many customers, you can more effectively plan the inventory on a demand-type basis rather than a customer-specific basis.

So we're doing both.

And I would say as volumes go up in a particular application, you have a better opportunity to plan inventory at a lower lead time basis or at a just-in-time basis, if you want to call it that.

Whereas if the volumes are low and customed, it tends to drive your whip up.

Right.

Okay.

Okay, got you.

And my final question was about the changes that the current administration is putting forward -- has put in place or plans to make put in place either on trade or on operations.

Are you seeing anything that will affect your outlook either because it affects your customers or it affects you?

We're looking for advice on it.

Do you have any?

And I say that because, I mean, we're progressing, looking at the business as usual, but we're certainly aware of what impact those changes may have.

And I would say to you, I don't see anything that's negative.

I think if anything, they're positive for us.

So -- but as of today, we have not changed our course and said, okay, our expectation is that this is going to happen on this date.

I think we're watching very closely, trying to understand what impact it may have.

And again, if anyone has any advice for us, we're all ears.

Our next question comes from Dick Ryan with Dougherty & Company.

Dick, maybe a couple of more questions on the Vehicle side.

Have we lapped the end-of-life impact?

Are we getting close to that point yet?

I would say to you, we're getting close.

We have not experienced all of it yet.

Okay.

And when you look at some of the projections for auto sales, at least domestically kind of peaking in 2016, how have you guys, maybe generally speaking, tracked new auto production?

And are any of the programs that are kicking in later this year, are they in the Vehicle space or in the other markets that you mentioned?

Okay.

Again, because of our diversification in the markets and program end of life, typically what happens in automotive-type programs is that you get designed in for a platform or certain vehicles and for a defined life-of-the-vehicle platform.

So to answer your question, we are not seeing any exposure to whatever's occurring in the U.S. right now, okay?

Our automotive market is primarily Europe, and it's on selected vehicles and selected euro vehicles on a vehicle platform, and that's really what's occurring.

I will say that we are now actively working on multiple platforms, multiple new vehicles in the U.S. as well as around the world.

And some are quite exciting.

Some are in the prototype preproduction phase; one -- and I'll call it relatively small, that should go into production this year, but it's nowhere near the magnitude, and that's why we didn't announce it of the $90 million award, but that should move into production later this year.

It is a vehicle, but we do have several new platforms and new vehicles.

And so the U.S. market is not a good indicator, and the overall vehicle market is not necessarily a good indicator of what's going to occur with us.

It's very specific to applications or which platforms that we're on.

As we broaden that, and I will tell you, as we continue to grow and expand and secure additional wins, then I think we'll -- you can relate back to what our business is going to look like more closely to what the market's doing.

Okay.

You talked about stability, starting to get better for vehicles.

Now your largest customer looked to be close contribution-wise, absolute dollars year-over-year, and I think their commentary kind of suggest the same.

Is there anything you can provide, off-road vehicle commentary?

No, I'd say -- that is when you're asking questions about that particular segment, it's well published in terms of the headwinds that we've seen there.

So I will tell you that, as I said earlier and Greg's question was about similar, it has, we say, stabilized.

It has stabilized, but it is at a lower volume than it was a couple of years ago.

And it has -- it's still got a little uneasiness in it.

It's not totally stable yet, I would say.

But it's not like it was, like we've experienced the last couple of years.

Sure.

One last on Automate, good showing with the Heidrive products.

I think you made some commentary there for customer context.

But how about the -- what you may or may not be seeing on expanding the distributor network?

Was that part of the goal?

And what have you -- what have we seen following the show?

Great question.

I think we've announced that our goal here is in order to be successful in other markets and other channels where our products can be sold in that is one channel that has to develop.

So we had quite a bit of traffic at Automate, and let's just call it almost a launch point, so that they could come and view and see what we have and touch and feel.

And we have an active program, and we have targets for this year for adding some additional agents/distributors to our channel.

So that's coming.

In addition to that, what you saw with the Heidrive -- Dick, you saw the product line; it's a platform product.

Now what we're looking at a subset for the North American market and looking at features that's specific to the North American market.

It's primarily been sold in Europe, and I should say it's also found its way into Asia in certain applications, but it hasn't touched North America yet.

And our team has done a nice job of identifying what that feature set is that's required for us to be successful in North America, and it's currently -- will be launched here very shortly.

In addition to that, it requires, if we're going to be effective in the distribution and end user channel, a set of electronics that go along with that, and that is actively being developed also.

So Electronics there has been a good success story for us and has been behind the scenes, but it is driving several of the new wins, and we see a continued investment there that will expand.

We talked about gross margin expansion, value expansion and we truly believe that's the way to go.

We've had good growth internally.

We don't -- we really don't split out our sales on the technology and the standpoint, but that one has developed nicely, and as I mentioned prior -- previously here, not only in attracting new business but retaining base business, which to us is obviously very important too.

So I think we've -- we're now in the process of following up on the leads.

We are -- our next show will be in Europe at SPS in Nuremberg.

And Heidrive has always been in that show.

I say always, the last several years.

And we are now expanding to add and present the rest of Allied Motion at the show and more of an application focus where we see it makes the most sense.

So we'll be a little bit more active in the trade shows, and we'll be a little bit more active in -- we feel the -- and the distributor and the agent channels here so...

(Operator Instructions) Our next question comes from JP Geygan with Milwaukee Institutional Asset Management.

Couple of questions for you.

Number one, with regard to the new auto customer in Europe, what role did Heidrive play in that, if any?

Zero.

This was started in mid-2014.

Heidrive was not part of us at that point, so it was the -- not involved at all.

How would you judge the Heidrive integration today?

I would judge it that as long as Heidrive continues to show success and growth in their markets that we're happy, and we're seeing that.

So from an integration standpoint, of course, the first thing that have to occur is financial integration and so forth.

The launch of the product line in North America, which I said prior -- previously, is effectively zero sales in North America.

That's just occurring now.

So there's a strong -- and there's a strong working relationship between our engineering communities.

Heidrive brings some great capabilities from an engineering standpoint, and we're leveraging that across the company.

And I say there's benefit going both ways.

So I think -- I mentioned the SPS show in Nuremberg here in November.

It will be the first time there will be a connection in Europe about what else do we have to offer as a company.

And so I think we're on track.

We're doing what we think is prudent.

I think -- our customers they're primarily Europe-based sales and really Germany.

And I think that's settled down very nicely.

There is initial concern with an American company buys a German company, but I think it's settled down quite nicely.

And we're seeing additional new opportunities come to light.

So from an integration standpoint, I call that a success.

And we do see -- we have good expectations for continued growth and success there.

Regarding the product launch that you mentioned earlier, what end markets are those products oriented toward?

Okay.

Product launch is that I mentioned earlier, you said?

Yes, I believe you mentioned when you were at the Chicago trade show that you were launching a new product line?

Got you.

Okay, yes.

What we did is we launch -- we debuted, I'll call it, the Heidrive high-performance Servo line, which we call high-motion servos at the Chicago show.

So that -- because of the design of the product and it's a platform and its high-performance Servos, it -- that lends itself quite well to the end user, meaning if you're going to do factory automation or any type of automation project it lends itself well to that.

In addition to that, it lends itself to any OEM product that has high performance requirement and sort of a Servo requirement.

We're -- what I mentioned also is that no limitations on it, are that we are launching the combination of a motor and a gearbox, a brake and a feedback element, okay, which does have some specific unique requirements in North America.

But the real opportunity, I think, we'll have for further growing that product line is the Electronics that we're working on.

And that will not happen until -- the Electronics are already being worked on, but it won't happen till next year.

So we'll get some bump.

We got to get the channels built, which we're doing.

We brought the -- some perspective selling channels through the booth, which I think was successful.

And then I'd say we're going to be -- you're going to see us in industrial applications, industrial motion applications and OEM medical equipment, even defense type applications where high-performance servos are required are candidates.

Great.

Final question.

Obviously, product mix is relevant to gross margin.

You gave us very good color earlier on the call with respect to increases and decrease in rev by the different verticals.

Can you prioritize something like best to least in terms of where we would reap the greatest profitability or gross margin and then your strategy to penetrate the higher-margin segments?

Sure.

Well, I will say to you that their -- again, I have to be careful in our Vehicle because we have obviously very difficult segments in our Vehicle market.

And when typically you speak of automotive, you'll speak of higher volume, lower unit margin.

But you're looking at that prospect of the high volume to generate a decent and a reasonable overall profit picture.

So when you get into those automotive-type applications, if volume increases you cover your overhead cost and you are meeting the projections in terms of the volume, then you could present -- generate a reasonable profit.

Typically though, there are -- in contracts, those are a little bit controlled, but it really is driven by volume . That's why it's important for us.

It's not just one win.

We're confident of others to come.

And that's what really going to drive that side of it.

When you get into our other markets, there's a wide variety of applications.

And I can say Medical -- and there's a piece of Medical which is very strong, and there's a piece of Medical where it's not as strong.

And when I get into Medical mobility, I will say to you that, that's more -- and I hate to call commodity, because we try not to compete and be in commodity areas.

But it's -- there's other competitors around the world that have kind of addressed that need.

So we have to stay in the higher performing instrumentation type applications and the higher-performing mobility applications in the automation side of it, the robotic side of it, where we feel those margins are strong.

Aerospace & Defense can be very strong, and I say can be very strong.

And typically you are working on high-performance small packages, and customized solutions would generate better margins for you.

The downside of that is they take longer to develop, and they require a significant amount of engineering resources, but once you get them, they are strong, so I think it's encouraging.

If you hear us talk about Aerospace & Defense going up, that's a good sign.

You hear us talking about Medical going up, that's a good sign.

And even Industrial automation and certain high-performance OEM equipment, that's a good sign.

Vehicle is -- has many segments.

We're having some successes in certain markets with automated material handling and so forth.

And we're in the performance side of those, and those are good markets.

So I think the overall mix, as I look at the mix going forward, adding more technology, looking at these higher-performing markets and supplementing that with some volume that we can leverage into these other markets, I think there's a good success potential for us, so increased as we've talked about in the past.

This concludes the question-and-answer session.

I would like to turn the conference back over to Dick Warzala for any closing remarks.

Well, I'd like to thank everyone again for being on the conference call and a great set of questions here and your continued support in the company.

We look forward to talking with you again next quarter.

Conclude the call, operator.

This concludes today's conference call.

You may disconnect your lines.

Thank you for participating, and have a pleasant day.