Apollo Endosurgery Inc (APEN) 2018 Q4 法說會逐字稿

Good morning. My name is Sharon, and I will be your conference operator today. At this time, I would like to welcome everyone to the Apollo Endosurgery Fourth Quarter and Full Year 2018 Results Conference Call. (Operator Instructions)

Mr. John Gillings, you may begin your conference.

Thanks, operator, and thanks, everyone, for participating in today's call. Joining me on the call are Todd Newton, Chief Executive Officer; and Stefanie Cavanaugh, Chief Financial Officer.

Before we begin, I would like to caution listeners that comments made by management during this conference call will include forward-looking statements within the meaning of federal securities laws, including Apollo's financial outlook, Apollo's plans and timing for product development and sales. These forward-looking statements involve material risks and uncertainties, and Apollo's actual results may differ materially. For a discussion of risk factors, I encourage you to review the company's annual report on Form 10-K filed today, March 18, 2019, with the Securities and Exchange Commission.

The content of this conference call contains time-sensitive information that is only accurate as of the date of the live broadcast, March 18, 2019. Except as required by law, Apollo undertakes no obligation to revise or update any statement to reflect events or circumstances after the date of this call.

During this call, we will interchangeably use the term ESS for OverStitch and the term IGB for Orbera and vice versa. In this call, we will also refer to the term continuing product revenue, which excludes the revenue associated with our Surgical products which we divested on December 17, 2018. Continuing product revenue will differ from our GAAP revenue as we will still report historical and transitional Surgical product sales as part of our GAAP revenues.

Now I would like to turn call over to Todd.

Thank you, John. And good morning, everyone, and thank you for joining today's call to discuss our fourth quarter and full year 2018 results. The fourth quarter was a very productive quarter as we materially recast or restructured our business for better long-term shareholder success. In December, we shed our declining and underperforming Surgical product line.

Our goals with this transaction were to create a more focused company, monetize a nonstrategic asset and remove a barrier to our top line growth profile. The final deal structure was somewhat complex, but we estimate the combined proceeds from the various agreements in the transaction will provide us an equivalent amount of cash flow over the next 3 years as the Surgical product line would have contributed had we continued to own and operate it.

Both before and after the Surgical product line divestiture, OverStitch is our top-selling product. In the fourth quarter, OverStitch was 64% of our continuing product sales and grew 46% over the fourth quarter of last year. And since the beginning of February, we have been in the full launch of the new single-channel compatible OverStitch, what we call OverStitch Sx in the United States and our European direct markets.

We remain bullish as well on the Intragastric Balloon's market prospects. The U.S. market development effort has been rocky up to now, to say the least, but in the fourth quarter, we put in place a number of programs with some of our most capable customers to support the current weight loss season that kicked off in January with the new year.

We also see progress from our efforts to position the nonsurgical weight loss from Orbera as a high-value treatment option for various medical needs, such as fatty liver disease, as was shown last year during Digestive Disease Week. And I'll talk more about this shortly.

And lastly, we are very pleased to share with you on this call the refinancing of our long-term debt. Our new facility with Solar Capital is more tailored to our restructured business and its needs.

I'll turn the call over now to Stefanie, and then I'll come back with some more comments on various initiatives that we have underway. Stefanie?

Thank you, Todd, and good morning, everyone. ESS sales increased 46% to $6.9 million in the fourth quarter of 2018 versus $4.8 million in the fourth quarter of 2017. Sales in the United States increased 47% to $3.4 million, and outside the U.S., ESS sales increased 44% to $3.6 million.

For the year, ESS product sales were $23.4 million, an increase of 42%. ESS growth had been achieved from both the expanded procedures within existing account and the addition of new customers.

Intragastric Balloon or IGB sales were $3.9 million in the fourth quarter versus $5 million in the fourth quarter of last year. Sales in international markets were roughly 3/4 of our total IGB revenue in the fourth quarter and amounted to $2.9 million. This was a decline of 24% compared to the fourth quarter of 2017 and was primarily due to lower sales to distributors.

In direct market, ongoing market share gains in Europe, where we have available the Orbera365 product, were offset by declines in Brazil. In the United States, IGB sales declined approximately $240,000 versus the fourth quarter of last year or roughly 120 fewer balloons sold. This reduction is primarily due to continuing weakened market conditions that have persisted since the June 2018 FDA letter to health care professionals.

In total, continuing product revenues for the fourth quarter of 2018 increased 10% compared to the fourth quarter of 2017 to $10.8 million. Our GAAP fourth quarter revenue of $15.2 million included $4.1 million of Surgical product sales, which we divested as announced on December '18. For the full year, continuing product sales of $41.1 million increased 15% while GAAP sales, which includes divested Surgical products revenue, declined 5% to $60.9 million.

Gross margin for the fourth quarter of 2018 was 46.6% compared to 57.7% in the prior year period. And for the full year 2018, gross margin was 54.5% compared to 61.8% for 2017. There were 2 very distinct factors influencing our lower gross margin percentage this quarter, one of which is part of an ongoing trend and one that is a due to a deliberate effort on our part to bring down our finished goods inventory in the fourth quarter of this year.

First, the ongoing trend and one we have spoken of often in the past. As our sales mix has shifted from the declining Surgical products with higher gross margin to Endo-bariatric products and especially to our ESS product line, which has a lower gross margin, our overall gross margin has declined. Second, as we also have discussed in the past, we have been actively pursuing 3 named projects aimed at improving our Endo-bariatric product gross margin over the past 2 years. In 2017, this was the transfer of the Helix from a contract manufacturer to our facility. And in 2018, this was the transfer of the Cinch as well as changes we made to various components of our IGB product.

In preparation of these projects, in 2017, we increased our finished goods inventory to protect us in the event that the transferred products were delayed for some reason. With the completion of these projects, we took efforts to bring down our finished goods inventory in the fourth quarter. As our transitional risks have dissipated, we have lowered our finished goods from over $10 million at the end of 2017 to $5.8 million at the end of 2018, with approximately $3 million of this reduction occurring in the fourth quarter, and this is a favorable trend. However, it also means that more of our manufacturing overhead costs was charged to cost of goods sold in the fourth quarter than in other periods even though our fourth quarter manufacturing overhead spend is materially unchanged.

Total operating expenses were $23.9 million for the fourth quarter 2018 compared to $15.2 million in the fourth quarter 2017. The largest contributor to this increase in operating expense was the loss on divestiture of the Surgical product line of $7.8 million. Excluding this onetime loss, total operating expenses were $16.2 million, an increase of 6% or roughly $1 million over the fourth quarter of 2017. This increase was mainly due to higher research and development expenses resulting from higher clinical trial activities, new product development costs and costs incurred in connection with our various gross margin improvement projects.

For the full year, excluding the loss on sale of the Surgical product line, operating expenses for 2018 was $65.5 million compared to $62.2 million for 2017, an increase of 5% due primarily to higher research and development across all quarters of the year.

Our net loss for the fourth quarter of 2018 was $18.4 million compared to $7.3 million for the fourth quarter of 2017. Excluding the loss on divestiture, our net loss would have been 16 -- sorry, $10.6 million. Again, excluding the loss on divestiture from full year results, net loss would have been $38 million compared to $27.3 million in 2017.

Along with our results, we announced in this morning's press release that we closed a new senior secured credit facility with Solar Capital Ltd. At closing, we borrowed $35 million, which was used to retire our prior credit facility that was set to mature in February of 2020. After payoff and all associated transaction costs, the borrowing will increase our cash on hand $11.6 million.

Additionally, the facility has the potential to be increased by another $15 million as a mutual agreement of ourselves and the lender. The facility is also tailored to our restructured business, whereby future financial covenants are exclusively based on our endo product performance. And future payments we receive from the sale of our Surgical business can be used for general corporate purposes while in our previous credit agreement, these were -- receipts were required to be used to pay down loan principal.

Lastly, the credit agreement does not include any warrant coverage. Our objectives for our refinancing were: to fully refinance our existing debt; second, to extend our cash runway position; third, be reflective of our restructured business; and fourth, to have minimal dilution. We think these objectives have been accomplished.

And I will now turn it back to Todd.

Thank you, Stefanie. As I mentioned in my opening remarks, we kicked off the full launch of the OverStitch Sx in early February in the U.S. and European markets. We have high expectations for Sx as it allows us to take flexible endoscopic suturing from a niche application that required a physician to have access to a niche endoscope to a mainstream, readily available solution for any physician who is performing flexible endoscopy.

The primary focus in the early stages of our Sx launch is to expand our user base, especially with physicians who have core GI application needs. Like the established OverStitch device, Sx will deliver the same full-thickness suturing and give clinicians the ability to customize their suture pattern for the broad range of treatment needs that the therapeutic endoscopist encounters today. The most obvious feature of the Sx is that it does not require investment in a dual-channel endoscope in order to gain access to the benefits of suturing. The Sx is compatible with over 20 single-channel flexible endoscopes, representing the most prevalent endoscopes in the market today across 4 different manufacturer platforms.

Today, our U.S. OverStitch business consists of approximately 400 accounts, representing about 900 users. We estimate that closer to 4,000 of the roughly 15,000 gastroenterologists in the United States have a therapeutic practice and, therefore, could benefit from the improved access to suturing that Sx offers.

In the fourth quarter, we were conducting what we call the limited launch of Sx, and we learned a lot about the nuances of attaching Sx to the various different scope platforms, using it in different tissue types and for different therapeutic needs. We will, of course, give you an update on how the full launch is going at the end of our first quarter.

The Sx is a new product and will often require review by a hospital's value analysis committee or VAC prior to its purchase. The length of time the VAC process takes can vary from one facility to another. Supporting the VAC process with the first wave of target accounts is now a major part of our launch efforts.

2018 was a really good year in the development of ESG or endoscopic sleeve gastroplasty procedure. I would say that this procedure really arrived this past year. Our goal at the beginning of 2018 was to have 100 U.S. physicians offering the ESG, and we hit that goal. Outside the United States, there are roughly 130 physicians regularly performing ESG.

Over the course of 2018, there were 12 new clinical papers published in various medical journals by physicians on their ESG results. Across all these papers, there was a heightened degree of consistency in the results in terms of patient weight loss, comorbid disease improvement and low adverse event rates, which were also consistent with earlier publications over the past 3 years.

To briefly highlight a recent example, on February 19, we made investors aware of the paper published in Gastrointestinal Endoscopy detailing ESG outcomes on 1,000 consecutive patients at a single center. These patients lost on average 64.7% of their excess body weight. In addition, these results showed 100% remission for hypertension-related comorbidities and a 70% remission for type 2 diabetes, with the remaining 30% of the type 2 diabetic patients showing significant improvement. Importantly, no patients required an emergency intervention, and there were no mortalities, confirming what we have seen previously with respect to the compelling safety profile of the ESG procedure.

As we observed these studies and talked with physicians, there is no doubt that this procedure is attractive to both physicians and patients, and we also think ESG will be attractive to payers.

The most important initiative we have directed at building payer data here in the United States market is the ongoing MERIT study, a multicenter randomized controlled trial of the ESG procedure being co-led by the Mayo Clinic and the University of Texas in Houston. The study participants consist both of bariatric surgeon sites and gastroenterology sites. The MERIT trial remains in active enrollment, and our most recent update was that approximately 3/4 of the study's 200 patients have been randomized.

Outside of the United States, our ESG clinical initiative centers on our European bariatric registry, a multicenter, multi-country registry that kicked off back in May of 2018, with the goal to capture data on both ESG and suture-based bariatric surgical revisions. In this registry, 190 patients have been enrolled so far. Our clinical data development program for OverStitch in 2019 includes other registry programs, both here in the United States and in Europe, to support the broader mainstream market adoption for core GI suture applications. Our purpose for all these studies is to support increased adoption and reimbursement for both bariatric and core GI applications in the geographies that we serve.

We trained 66 new physicians outside the United States on OverStitch during the fourth quarter of 2018 and another 143 in the United States through our mobile learning center. The majority of this training was still centered on the dual-channel OverStitch system. Similar to past quarters, we also provided educational grants to 23 different third-party-sponsored physician training events worldwide that wanted to highlight the benefits of endoscopic suturing to their audiences.

Now turning to IGB. We continue to believe this product line offers great opportunities. Outside the United States, adoption of Orbera365 has remained strong in the markets where it is available. Our efforts to obtain additional clearances for Orbera365 are progressing slower than we had hoped, and in some markets, we will need to supplement our applications with additional clinical data. Of our top 20 distributor markets, only about 1/3 of those today currently have regulatory clearance for Orbera365.

During our last earnings call, I shared my enthusiasm regarding the growing interest within the hepatology community concerning Endo-bariatric therapies such as Orbera and ESG to treat patients with fatty liver disease such as NASH. There are a large number of drug candidates in the pipeline searching for treatment for this unmet need, but most are still a long ways away from becoming commercially available. The connection between weight loss and improving liver disease is well established, and the major hepatology societies have published guidelines for weight loss as part of their treatments. These guidelines call for weight loss of at least 7% or preferably 10% of the patient's total body weight in order to notably improve a patient's liver function.

Orbera consistently helps patients achieve this 10% total body weight loss target throughout its more than 230 peer-reviewed publications. While the importance of weight loss to treat liver disease is widely known, the awareness of endoscopic weight loss options is surprisingly low, and our efforts right now are centered on improving clinician awareness.

And as a result of these efforts, there will be a dedicated session at this year's International Liver Congress, what is known as ILC, in April in Vienna on Endo-bariatric therapies as alternatives for NASH patients. ILC is a flagship event in the educational calendar of the European Association for the Study of the Liver, also known as EASL. It typically has over 10,000 attendees. This session will be the first time this topic of Endo-bariatric treatments has been on the agenda at this meeting. We believe that improving awareness in Europe, where we have a solid established user base, is a place for us to push forward this initiative.

Even though our IGB revenue in the United States is less than 15% of our continuing product revenue, establishing the IGB market in the United States remains an important goal. In many respects, this weight loss season is fundamentally the third launch of Orbera in the U.S. market. In the current cash pay environment, consumer-facing marketing efforts are obviously important. And in 2018, the plastic surgery practice has emerged as a leading site of service due to their typically strong marketing and cash pay operating capabilities. About half of our new Orbera users added in 2018 were affiliated with plastic surgery practices, and plastic surgery accounts were 38% of our U.S. Orbera sales in the fourth quarter of 2018 compared to only 20% in the fourth quarter of 2017. As we enter this weight loss season, we think we have the customers and marketing programs in place to be successful.

Margin improvement is something we have spoken about now for some time. And in 2018, our team completed the transfer of our Cinch product and also completed a series of changes to components of our IGB system, which together are estimated to produce $2 million in cost savings based on last year's unit volumes. This may get masked in the short term somewhat because of the removal of our Surgical product margins, but on our continuing revenue base of $41 million, $2 million in savings is roughly a 5% gross margin improvement. We have additional projects underway that, when completed over the next couple of years, will result in additional margin improvement on our continuing products.

I will conclude now with some commentary on 2019 revenue expectations. We estimate that our endo product sales should increase by 15% in 2019 over 2018. Residual Surgical sales are excluded from the above. I will continue -- we will continue to report Surgical sales during the length of our transition services agreements, but we have no targets or expectations to share with you on that. And this 15% that I mentioned is for the whole of 2019. We estimate endo product sales growth will likely be lower than 15% in the first half and higher than 15% in the second half of 2019.

And with that, we will open the lines for questions. Operator?

(Operator Instructions) And your first question comes from Matt Hewitt with Craig-Hallum.

Maybe, first, on the gross margins. You mentioned that you obviously -- you started to make some changes last year to help facilitate higher gross margins in the future. How should we be thinking about those in FY '19? And where do you see those going maybe over the next 3 to 5 years as some of those changes start to take effect and you see the rapid growth in the Endo-bariatric piece?

So thanks for the question, Matt. We have announced on the surgical call when we talked about the divestiture of the Surgical business that we expect our margin in 2019 to be in the low to mid-50% range. That's depending upon the timing of, of course, the divestiture, the transition that occurs; depending upon our sales mix; and also depending upon the timing of our gross margin improvement projects kicking in. But we have shared that with everyone, and we have no change to that thought process. Over the next 3 to 5 years, it is our intention that these gross margin projects that Todd referred to that we'll complete around 2020 should add another improvement in the $3 million to $3.5 million range, and that should get us into the mid-60% gross margin profile that we are now working to progress towards.

Okay. And then you mentioned the study out of Saudi Arabia that was published in mid-February. 1,000 procedures sounds like a pretty significant practice. How -- maybe help us understand why that's such a big deal. And more importantly, how many other doctors do you have, either domestically or internationally, that are running that number or that size of a practice?

Matt, it is significant in a couple of respects, and it's not necessarily -- these are not necessarily data points you'll pull out of the study. But one thing that makes it significant is that the bariatric practice at King Saud hospital is a very active practice. It's bariatric surgeon-driven. And the interesting thing about that study from my perspective was that, as we were talking to the physician who published the results, he did not see that ESG was replacing really any of his bariatric surgical procedures, his more traditional bariatric surgical procedures. What he noted was that ESG was attractive to many of his patients who otherwise would have opted not to receive one of the other traditional bariatric surgeries. So in that regard, what made him so excited, I think, was that he saw not a replacement of one procedure for the other, but he was observing and has continued to observe that his practice overall is just growing. In other words, the pie is growing, not just the ESG sliver of the pie.

Interesting, okay. And then maybe one last one for me and I'll hop back in the queue. Regarding the MERIT study, you're -- it sounds like you're approximately 3/4 of the way through the 200 being randomized. Maybe an update on what we should anticipate from a completion time line. And then will -- do you anticipate that we'll get maybe a readout shortly thereafter? Or just help us understand the time line.

Yes. And I don't have a lot of information to share with you, Matt, in terms of all the specifics on the time line. We are hopeful, though, that once they reach the 1-year follow-up point -- and of course, they have to finish randomization and enrollment before they can get to that even. But once they get to that 1-year follow-up point, that -- the principal investigators will elect to publish their interim results. But that's really up to them, and we don't have much, if any, control over that decision.

Next question comes from JP McKim with Piper Jaffray.

I wanted to ask one on this early launch of Sx in the U.S., maybe procedures that it's being used in, is it sort of how you thought it would be? Or is there anything that kind of jumped out as a surprise in that you didn't expect to see uptake that early there?

No, there's really nothing to give you, JP, in terms of that kind of color. What we have found -- and this is the reason why we want to do a limited launch. We have found that the Sx seems to work really well in all of those traditional uses that the older OverStitch was being used for. And so in that regard, we were trying to determine whether or not it had a limitation, if you will, before we went on with full launch, and we're very pleased in the limited launch that we didn't see those kinds of limitations.

Okay, that's helpful. And then on the kind of growth outlook in that business being stronger in the second half versus first half, I assume that comes down to the value -- the VAC committees. And so what's been -- like how long has it traditionally taken you to get through the VACs? I know everyone is different, but is that the real gating factor to your growth rate this year?

I don't think it's going to be a gating factor, JP, other than it's a timing issue here at the very front end. You're right in that the VAC process isn't usually something that takes months. It's something that can take weeks. But it's also, I think, what's influencing our 15%, also, is to do with the Intragastric Balloon business. I would say that in -- as we look at the first half here in 2019, we have 5 months of business basically that were pre the or before the FDA's third letter. And those months represent, let's just say, a higher comp period versus the back half of the year. So the IGB influences our estimates as well.

Okay. So IGB, I know you don't give it, but flat, down, up? Can you just give directionally where you think IGB will go this year?

Well, I think we don't give it broken down by product, certainly not this guidance. But we think that the 15% blended is probably somewhat instructive to you, JP. If we see OverStitch growing at a rate historic -- that is consistent with its historical growth, then you can very easily presume that the Intragastric Balloon expectation is going to be lower than 15%.

Next question comes from Suraj Kalia with Northland Securities.

Can you hear me all right?

Yes.

Okay. So Stefanie, the new debt put in place, does that have specific covenants on the revenues, cash flows?

So our agreement does have a revenue covenant. It's set at 85% of our plan for 2019, and we do have a minimum liquidity covenant or a requirement to maintain $10 million of cash.

Okay, got it. And Todd, specifically on Orbera, you are not marketing Orbera for NASH, correct? I just want to make sure this is -- your commentary was more implied as a side effect -- positive side effect for obesity treatment, you're not specifically marketing in NASH.

No, we're not claiming, if you will -- if this is the question, we're not claiming that Orbera is a solution for NASH. What we're -- our product label is that Orbera is indicated for weight loss, and the hepatology societies' own guidelines discuss weight loss as an important consideration for the treatment of NASH patients. So if you think about it that way, that's how we're positioning the product in the hepatology community.

Got it. And Todd, specifically for OverStitch, can you give us some color on the number of accounts OverStitch has been used? And just the sales and marketing landscape. It seems like the SG&A costs for OverStitch are high. Can you just kind of help us reconcile those 2?

Yes. I'm sorry, Suraj, if I get this is a little bit wrong because there you were starting to break up. But the color on the customer base, first of all, I think we mentioned this in the script. We have about 400 accounts in the United States, and an account is not necessarily equal to a user. An account would be where we ship product. We think those 400 accounts in the United States, though, represent probably close to 900 users who are relatively active users today with OverStitch. Relatively active just meaning that when they have a suturing case come up, they will tend to opt to suture versus some of the alternatives that they have. And as we were mentioning with the niche scope that OverStitch required in the past, that was -- while it hadn't changed our or affected our growth too much in those prior periods, it was going, at some point, become a limitation to us. So we think that the Sx is going to make the product and the technology just available to a wider number of accounts. And I mentioned 4,000 of the 15,000 gastroenterologists in the United States being potential suturing users. That's obviously not precise, but it's fairly well researched on our part, and we feel like that's a good indication of potential user base.

As far as sales and marketing for OverStitch is concerned, there's a far less amount of spend being put on things like direct-to-consumer advertising. It's not that kind of a product. It does require a field sales support. So the sales reps that we have, I would say, a lot of their time is spent on OverStitch. And the thing that OverStitch carries as well is a relatively expensive medical education component because it does take user training, and that's something that is probably incrementally higher than what we see for Orbera or what we had seen for the Surgical products in the past.

Got it. And frankly, Stefanie, my -- forgive me, my phone was -- my reception. [I was out on the van]. You mentioned -- made some comments on inventory drawdown in Q4 and the impact on margins. Can you repeat that again? Forgive me, I missed it.

Sure. Suraj, no problem. So yes, our inventory declined this year in order -- as planned. We had built up our inventory in anticipation of the transfer related to the gross margin improvement projects. So in 2017, we ended at $10 million, which has had some of that increase or most of that increase in it. Now that we've finished the Helix project, the Cinch project and the IGB project early in the fourth quarter, we were able to now bring down those inventory levels. So when we were at about $10 million at the end of '17, we're at about $6 million at the end of '18. And about $3 million of that decline all occurred in the fourth quarter. And so that's good -- from that perspective, that's a good trend in terms of needing to invest in increased inventory levels. But the downside or the flip side of that is, at least during the fourth quarter, we had an impact on the amount of overhead that was charged to cost of goods sold. It's important to know that our overhead spend didn't go up. It's really just the rolling out of that inventory that had been sitting on the balance sheet in anticipation of any potential disruption associated with those projects.

(Operator Instructions) And we have a question from Matt Hewitt with Craig-Hallum.

Just wanted to dig in a little bit more on the NASH opportunity. I guess a couple of different aspects of this. Number one, what is -- how do you get this information into the hands of the physicians, the surgeons? What's the best way to attack this market, especially in light of some of the opportunities that you see out there? I mean, if you look at some of the valuations of the drug companies, and these are drugs that are still in clinical development, maybe years away, if ever, getting approved, yet you have both balloon and ESG that have shown data that supports the treatment of NASH. So you've got the data already. So maybe just walk us through what is the way that you plan to attack that market.

Well, Matt, first of all, the most important thing we feel like we can do in the short term is to continue to create clinician awareness. And this is why events like the ILC event that we mentioned coming up in April is important. It gives us an opportunity to be on the stage, if you will, to have some of the clinicians who have had great results with Orbera treatment for NASH patients talk about it and create that awareness. That's the most important thing we can do right now. There's still some work we need to do in terms of things like labeling, and of course, it's probably an area where you really can't have enough clinical evidence ever. There's going to always be a little bit of a demand for more clinical evidence, so we need to do some more work there. But in the short term, we think, especially in Europe, where we have a relatively established and large Intragastric Balloon user base, that we can create clinician awareness at the hepatology societies. Hepatology departments and gastroenterology departments are fairly well aligned within most hospital structures, and just by creating that greater clinical awareness, we can have an impact on our positioning of the balloon for that use.

(Operator Instructions) And we do not have any telephone questions at this time. I will turn the call over to the presenters.

Great. Well, thank you, operator. And in closing, we would like to thank all of you for your interest in Apollo Endosurgery today. And should you have any questions for follow-up, please contact John Gillings, our Investor Relations Manager, and his contact information is listed on our press release today. Thank you very much.

This concludes today's conference call. You may now disconnect.