Apogee Enterprises Inc (APOG) 2007 Q4 法說會逐字稿

Good day, ladies and gentlemen, and welcome to the Apogee Enterprises 2007 fourth-quarter earnings conference call. My name is Dan, and I will be your operator for today. (OPERATOR INSTRUCTIONS). As a reminder, this conference is being recorded for replay purposes.

I would now like to turn over to Miss Mary Ann Jackson. Please proceed.

Thank you. Good morning and welcome to the Apogee Enterprises fiscal 2007 fourth-quarter and year-end conference call on Thursday, April 12, 2007. With us on the line today are Russ Huffer, Chairman and CEO, and Jim Porter, CFO. Their remarks will focus on our fourth-quarter and year-end results and the outlook for fiscal 2008.

During the course of this conference call, we will make forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on current expectations and the current economic environment and are, of course, subject to risks and uncertainties which are beyond the control of management.

These statements are not guarantees of future performance, and actual results may differ materially. Important risks and other important factors that could cause actual results to differ materially from those in the forward-looking statements and projections are described in the Company's Annual Report on Form 10-K for the fiscal year ended February 25, 2006, and in our earnings release issued last night and filed this morning on Form 8-K.

The information in this conference call related to projections or other forward-looking statements may be relied upon subject to the previous Safe Harbor statement as of the date of this call and may continue to be used while this call remains on the Apogee website.

Russ will now give you a brief overview of the results, and then Jim will cover the financials. After they conclude, Russ and Jim will answer your questions. Russ?

Good morning and welcome to our conference call. We're very pleased with our fourth-quarter and full-year results. Our architectural segment was the driver of our significantly improved performance. We earned $1.12 per share in fiscal 2007, a 29% increase from the prior year. Revenues were up 17%.

The key metric in this increase in the architectural segment operating margin -- it was 5.8% in fiscal 2007 compared to 3.2% the prior year, as pricing, operations and project mix improved in a strong commercial construction market.

For the year, architectural segment revenues were up 21% and operating income more than doubled compared to the prior year.

We ended the year with a backlog of $424 million, up from $321 million a year ago. Our fiscal 2007 large-scale optical segment results declined versus the prior year, as some customers offered a less favorable mix of value-added framing products for most of the year.

We made progress in exiting two small noncore business lines late in the fiscal year. We decided to sell the last operating piece of our auto glass segment for recreational vehicle and bus windshield manufacturing business. We expect this sale to be completed by the end of the third quarter of fiscal 2008.

At the end of the fourth quarter, we also stopped producing auto replacement windshields and began the process of transitioning our auto windshield manufacturing capacity to support architectural glass fabrication. Effective with our fourth-quarter reporting, our auto glass segment moved into discontinued operations.

We continue to report our investment in the PPG Auto Glass joint venture in equity and affiliates.

We also plan to sell our preframed art/wall decor product line, which is part of the large-scale optical segment. This sale should be completed by the end of the third quarter of fiscal 2008.

With these moves, we now have an even clearer focus on our architectural and picture framing glass businesses, both of which offer great opportunity for Apogee.

Before turning to our outlook for fiscal 2008, I would also like to note that we generated free cash flow of more than $8 million after investing approximately $40 million in capital expenditures. We also ended the year with a debt of $35 million, down $10 million from the end of fiscal 2006, which was better than expected due to our improved earnings, reduced working capital and the timing of some capital investments. I am pleased with the improvement in our return on invested capital in fiscal 2007.

Next, I will cover our outlook for fiscal 2008. We are anticipating another strong year in fiscal 2008. We have increased our earnings guidance to $1.27 to $1.37 per share from $1.20 to $1.30. This is based in part on our strong finish to the prior year and our large architectural backlog with improving job margins. We expect our architectural segment will again lead our performance.

We anticipate that our architectural segment operating margins will increase to 6.4% to 6.7% in fiscal 2008 as we maintain the operating improvements we have achieved in our architectural glass business and see continued improvement in our installation and window businesses.

We are pleased to report that our new southwest architectural glass plant began first production runs this week. We're scheduled for a gradual ramp-up over the next few months and expect to reach our full production run rate of $40 million in annual revenues during fiscal 2009.

This new plant in Utah will provide much-needed capacity to serve our strong markets. This, along with the conversion of our auto glass facility, will support our architectural glass growth opportunities.

We anticipate 10% to 13% growth in architectural revenues, which will be supported by our large backlog and strong markets. 83% of our year-end backlog of $424 million is expected to be delivered in fiscal 2008. It is a positive that our backlog remains balanced across nonresidential segments. Approximately 35% of our backlog is in the institutional sector, which includes education, health care and government buildings; 25% to 30% is office; 20% to 25% is condominium; and 10% to 15% is entertainment and hotel projects.

McGraw-Hill's outlook for our fiscal 2008 is for 16% growth in the nonresidential construction market. In fact, McGraw-Hill's forecasts through our fiscal 2013 anticipate growth for all but one year, which they expect to be flat.

Turning to our outlook for the large-scale optical segment, we are expecting operating margins of 11% to 12%. Segment revenues will be flat in fiscal 2008 as picture framing growth is offset by the planned sale of our preframed art product line and our continued transition away from consumer electronics products.

We anticipate strong growth in our best value-added framing glass products, which offer visual benefits to customers. Key customers converted to our best products late in fiscal 2007, and we expect this trend to continue this year.

I'm excited about Apogee's prospects for fiscal 2008 and beyond. With our strong commercial construction markets and improved architectural segment execution, we are positioned to continue to grow our bottom line 20% annually.

Jim will now comment on the financials. Jim?

Thanks, Russ. Good morning and welcome to our conference call. We are pleased with our fiscal 2007 results and with the way we finished the year. Our architectural segment performance positions us to continue to deliver revenue and earnings growth in the current year.

We are entering fiscal 2008 with a very high architectural backlog, combined with leadership positions resulting from our value-added products and services, and focus on customer service.

Our fiscal 2007 earnings per share from continuing operations grew 29% on revenue growth of 17%. The full-year earnings per share reconciliation between the current earnings of $1.12 per share and the $0.87 per share earned in the prior-year period is the architectural segment core operations added $0.46 per share, with approximately half of the increase coming from pricing and the remainder split between manufacturing productivity and job margin improvement.

This segment improvement was slightly offset by the large-scale optical segment, which was down $0.09 per share from the prior year. Other items in the full year were a charge of $0.06 per share for incremental stock-based compensation, a charge of $0.02 per share related to the planned exit of the preframed art product line, a $0.01 per share impact for an increase in weighted average shares, and a gain of $0.04 per share due to proceeds of the flat glass settlement, which are all components of segment operating results.

Also in the prior year, there was a net tax benefit of $0.07 per share resulting from resolution of certain tax matters.

Fiscal 2007 earnings per share impact in discontinued operations was a loss of $0.02 per share due to the operating loss at our auto glass segment.

For the fourth quarter, we saw earnings per share increase 52% on slightly greater than expected revenue growth of 17%. The fourth-quarter earnings per share reconciliation between the current-year earnings of $0.32 per share and the $0.21 per share earned in the prior-year period is the architectural segment core operations added $0.14 per share; large-scale optical segment operations were neutral, but the segment declined $0.02 per share from the fourth quarter of last year due to the noncash charge related to the planned exit of the preframed art product line.

Other items in the quarter were a charge of $0.01 per share for incremental stock-based compensation; income from the PPG Auto Glass joint venture reported in equity and affiliates added $0.01; and there was a $0.01 per share impact for an increase in weighted average shares.

I will turn to our outlook for fiscal 2008. We're very optimistic about fiscal 2008 and have raised our outlook for the year. We're now expecting an earnings range of $1.27 to $1.37 per share on revenue growth of 9% to 12%. Fiscal 2008 is a 52-week year, while the prior fiscal year had 53 weeks. On a comparable-year basis, fiscal 2008 growth would be approximately 11% to 14%.

The increased outlook reflects our strong finish to fiscal 2007 and our large architectural backlog, with visibility to improving job margins, as well as a lower tax rate. As we updated our full-year tax computation, the rate for fiscal 2008 declined to 34.5% from our prior guidance of 36%, which accounts for $0.03 of the increase in our earnings per share outlook. Our fiscal 2007 full-year tax rate was 35.1%.

Moving forward on the planned sale of the remaining operations within our auto glass segment and the preframed art product line in our large-scale optical segment will allow greater focus on our core strategic businesses in fiscal 2008. We are in the process of increasing architectural glass capacity through conversion of our auto glass plant.

With the auto glass segment moved into discontinued operations, we have realigned our quarterly financial statements for fiscal 2006 and fiscal 2007. These historic tables were included in our press release last night. The operating income and revenues for our remaining architectural and large-scale optical segments haven't changed.

Before moving to the segment outlook, I will make a brief comment on the seasonality of our business. Revenue flow will be similar to fiscal 2007, with the second half slightly stronger than the first half due both to seasonality and new production capacity ramp-up.

Operating margins for both segments are expected to be stronger in the second half versus the first half, with the architectural segment first half impacted by the Utah plant startup and the large-scale optical segment first half impacted by the transition of the preframed art product line.

For the architectural segment, we continue on track to meet prior peak segment operating margins. This year, we are expecting operating margins of 6.4% to 6.7%, which includes the negative impact of the startup of our Southwest glass fabrication facility. Without the startup impact, our top-end range is hitting the prior-year peak of 7%, positioning us to exceed this margin in fiscal 2009.

We are slightly increasing our architectural revenue outlook in terms of dollars, but with our stronger than expected revenue growth in the fiscal 2007 fourth quarter, the architectural segment growth rate for fiscal 2008 will be slightly lower than we had previously anticipated. Our current outlook is for the architectural revenue growth of 10% to 13%.

The outlook for our large-scale optical segment is for operating margins of 11% to 12%, comparable to the prior year if the fourth-quarter charge is excluded. We expect revenues will be flat as growth of value-added picture framing product sales is offset by lost revenues from the sale of the preframed art product line and further decline in consumer electronics sales.

We expect selling, general and administrative expenses to be 13% to 13.5% of sales, up from fiscal 2007 in dollars and as a percent of sales as we invest in systems, business development, and sales and marketing to support for future growth.

I'll briefly cover cash flow for full-year fiscal 2008. We are estimating EBITDA, earnings before interest, taxes, depreciation and amortization from continuing operations, of $77 to $83 million. We estimate net cash provided by continuing operations of $40 to $50 million for the year.

Capital expenditures are projected to be approximately $40 to $45 million. Fiscal 2008 strategic investments include completing current architectural glass expansions and spending to expand picture framing glass capacity for fiscal 2009.

We anticipate this will give us free cash flow of up to $10 million. We will continue to focus on ways to invest in growing our business as a use for our free cash flow. We define free cash flow as net cash flow provided by operating activities minus capital expenditures.

Including our normal ongoing dividend program, we project year-end debt will range from $35 to $45 million. We could see an increase from the end of fiscal 2007 resulting from an increase in working capital as we bring on new capacity and grow our business.

As Russ stated, our businesses are well-positioned to deliver strong performance in fiscal 2008. Thanks. Russ?

Thanks, Jim. I would like to go ahead and open the call up for questions at this time.

(OPERATOR INSTRUCTIONS). Michael Cox, Piper Jaffray.

Good morning. Congratulations on a very strong quarter. My first question relates to the backlog. It really did pick up in the final two to four weeks of the month during the quarter there. I was wondering if you could comment on current quoting and sampling activity.

Quoting and sampling activities continue to run as strong as we've seen throughout the last few months. It is still a very good market. The market continues to be focused on securing supply as the construction of these projects remain at these levels.

Following the two divestitures that you noted in your prepared remarks, and really focusing on the core strategic business units, are there any other additional segments that you're currently evaluating under that same framework?

No, we feel that this really completes the realignment. The only thing that remains nonstrategic is the joint venture with PPG, which we feel is a financial investment.

As we look at the 2008, fiscal 2008 CapEx budget, what could we view as the maintenance CapEx component of that, and what would be the onetime capacity increase?

We think that maintenance capital is probably going to run close to $25 million, so the balance of that will be investment in new capacities.

And then my last question is as we look at the new capacity coming on line this year, I was wondering if you could quantify what type of drag on earnings we would expect in the first half of the year? It sounds like that is where we would see it.

Yes, that is where we would see it. We're talking about a roughly full-year impact of about a 0.3 point operating margin, and it will definitely be negative in the first half, a little bit negative in the third quarter, and then in the fourth quarter turning positive.

Great. I certainly appreciate it, and congratulations again.

Steve Denault, Northland Securities.

Good morning, everyone. Very nice quarter. Can you provide any color in regards to -- whether or not you're participating in any of these major projects on an international basis? I know last year, less than 10% of your revenue was international based, but is there any opportunity there?

Our international participation is supply of glass. We're not doing anything else other than glass. We continue to be opportunistic in the projects. Our named is widely known. The brand is very strong internationally throughout the world. But most of the projects that we're on tend to be U.S.-based architects and an owner that is really trying to establish a true -- valuing a Western look or a design that we can provide that is somewhat unique.

So we continue to do major projects. We are pleased with that work. But in a business where we are essentially running at capacity, it is a -- we want to maintain that brand, and it is a balance.

Especially these really major worldwide projects, and especially you're seeing a number of them in the Middle East, but most if not all of them do include Western architects, that we do have great relationships. And in most cases, we actually are contacted and asked if we're interested in either bidding and even asked to bid. And then we just go back and look at our capacity and our opportunities, and as Russ said, are being opportunistic about which projects make sense for us.

That makes sense. But you could bid on them, and you could be competitive if you had the capacity?

Yes. Often, we are even specified on them. So a project will come out with a Viracon specification. So we are in a very good position to compete as we see it sit with our current backlog.

But also, though, oftentimes the margins are not as attractive on some of those global projects. So there is additional volume opportunity there, but they, at this point, aren't as attractive as many of the domestic projects.

Makes sense. If I switch gears to large-scale optical, if I add back the charge in the quarter, the operating margins were really healthy there. And you make reference to key customers converting to Apogee glass. What is going on there? Has Michaels come back, or what can you say about that?

What is going on is what we have described for the last several quarters, is that we have seen our major national contracts sort of being repositioned as changes have gone on. You mentioned Michaels. That is one of them. But we have been successful.

We believe in maintaining our favorable position with these customers and continuing to educate them on the value, how our products have helped their value, and we think it will probably be another quarter or two before you see those trends. I think we will begin to see some trends that you'll be able to do some projections with.

But right now, it is still sort of a quarter-to-quarter -- because there is inventory changes, product line changes -- things like that are hard to trend at this point in time. But I would say to you, long term, we see it moving in a positive direction.

The fundamentals continue to be positive and strong in that business, and we have been saying for a couple of quarters now that we are seeing -- we call it a lot of noise. There is just a lot of product mix realignment happening at some of the larger customers that is just really making some quarter-to-quarter impacts as it flow through the operating margin.

And as Russ said, I think we're going to see another couple quarters of that volatility. But I think when we look at the operating margins for the segment, as I mentioned, we will see the first half have a little bit more of that noise, kind of on a lower operating margin basis, but the full year at that 11% to 12%, which means the second half should be a little bit stronger as we settle into the product mix at the customers.

But again, just to remind you, the product mix fluctuation that we are seeing in those customers is still all within value-added glass.

Correct. That's good to hear. Thank you.

Cliff Walsh, Sidoti.

Can you guys comment on the pricing versus volume growth that you're seeing in the backlog at this point?

A majority of the backlog in general and a majority of the growth is in our installation and our window businesses, and those are going to be driven by volume.

Do you expect pricing to pick up, maybe, as the office market heats up a little bit more?

We continue to see movements in pricing in our glass side. That seems to be settling out very nicely. Margins, we talked about this before -- the margin improvement we have in the window and installation side is more project selection and size of project -- both of those are favorable -- and operations, just operating better, doing a better job of executing on jobs that fit our competencies. So that is where those improvements are coming from.

Can you guys comment a little bit, I don't need the exact numbers, but if you can just kind of give us a basic sense of what the product mix was like two years ago, when the architectural segment was, I think, seeing a little bit more tougher environment than it is today. Can you paint a picture of what it was like two years ago compared to where it is now?

You're talking about in the segment perspective?

You're talking about office versus institutional --

Yes, yes. Just the general mix of business.

Since the market last downturned, our last [beat], we were 50% office. When that downturn took place, it sort of automatically rebalanced us because office went down the most. I think our mix has remained pretty balanced since that bottom. And we're pretty -- we are pleased to continue to keep that balance. So I think that it has been at sort of these mix levels, plus or minus 5%. It moves around quarter to quarter, but I think it has been pretty balanced.

Right. Over a kind of, roughly, a two-year time period, I would agree with Russ' statement that we're talking about maybe about a 5 point shift, and probably office was the segment that actually has increased over that time period, and with those viewpoints of growth actually coming from a little bit of each other segment.

So when you're talking about product mix improving, you're talking more along the lines of what actual glass products are being purchased rather than seeing a shift in the end market and what that demand is bringing?

Yes, it is glass. It is also project selectivity. That is very important to our engineered and installation businesses.

The key there is that is primarily related to the window in the installation business.

Right. The glass side has had the positive -- just positive markets. And office has been a plus, a minor plus, in all three areas.

Scott Blumenthal, Emerald Advisers.

Congratulations on the quarter. I'm sorry, Russ, can you go through the number of the percentage of backlog that is going to be delivered in the coming year? I missed that one.

Right. I believe it's 83% of the $424 million that is expected to be delivered in 2008.

Thank you. Would you be able to tell us how much or, I'm sorry, how many projects the $423 million in backlog represents, or at least kind of contrast that to where you were at this time last year?

Clearly, the size of the projects in our installation business have gotten bigger, but the backlog has grown at the same time. We look at capacity in terms of our project management skills to deliver projects, and certainly they have improved their skills over the last couple years, and so they can do more, but we were leveraging those in larger projects, and so that's helping us.

But in the glass side, the number projects remains -- it's very high. We do 1000 invoices a week in the glass side, and the other businesses, the window business has the fewest number of projects and then installation has a great deal. So it really hasn't changed that much, probably up slightly, but also the values are up.

This is Jim. This is really a rough estimate, but I would guess that the numbers of projects is probably up, I'm going to estimate 10%, but probably not more than that. I think the balance is going to be a combination of pricing and average job size.

I think relative to a year ago, in the total number, in the $423 million, so obviously there is 17% of that that actually goes out into fiscal '09 at this point. Frequently, when you have those longer-duration projects, they're larger average size projects.

That is very helpful. Thank you. (technical difficulty)

(OPERATOR INSTRUCTIONS). Tyson Bauer, Wealth Monitors Inc.

Good morning, gentlemen, and hopefully you made it through the flush this morning.

The sun is shining today.

Yes, it's shining now.

One, I have to commend you guys on your financial disclosure and your willingness to be so forthcoming. Obviously, that makes it a little easier, since you are spoiling us on the Street with -- I think we're in double-digit quarters where you've had positive results. I commend you on that.

Getting back to some of the topics that Cliff was addressing, your growth that you have had to this point and how that growth kind of adjusts as you go forward, given the outlook that you're giving us, the bidding versus execution, the intersegment mix, we have seen you add on CapEx in Georgia and Utah. You made transactions with AWallS. We have seen that type of growth that we can identify. We can relate to the growth in the marketplaces and the pricing capability you have.

Going forward, give us a better sense, really, at the intersegment basis where -- is Viracon having much better pricing, if the volumes already kind of stuck with -- except for your expansion activities? Are you getting more higher value-added products through that segment? Harmon, are we looking at just vastly greater installations? How easily can you adjust to the market demands in that segment? Just give us a little better sense of how you have been able to get to this point, and does that really shift in any way going forward?

I will talk about the segment sort of in parts. On the glass side, we have really benefited from pricing, as well as these additional volumes. Going forward, we're going to -- probably we will benefit more from volume improvements, likely, than pricing. So that is what we would anticipate there.

On the window side, we are certainly focused on growth in standard windows, as well as optimizing our engineering capacities in the marketplace. We think that those are nice growth opportunities for us. So we have added some capacity to our standard window line, and we expect to remain focused on that and watch it grow.

On the installation side, it is more of -- it is still gaining maturity of the project management. That is sort of the constraint of the business. As they have gained experience, then they have the ability to do larger projects or more projects, and we're doing so. And at the same time, the market affords us the opportunity to be more selective in the kinds of projects that we're able to secure.

All of those things really drive top line and bottom line, margins and top line. So it is really that combination. I think it is important for us to remain balanced. I'm happy to see office up as a percent of the backlog, and I would like to see it probably go up a little more. I think that is good for us overall. But I wouldn't want to -- I would like to see us remain balanced in our backlog, not let it go to an extreme.

Do you put more attention or focus, say, on the installation side now going forward, given the long-term view you gave earlier in the call, that being less capital intensive to grow in that segment? You talked about human capital or human resources to grow that. Just give us a little bit of a flavor on is that really the avenue that becomes now the lead dog as you look forward the next several years?

I think that in terms of immediate growth, our growth is going to come from the standard window line, which we focused on, and it's going to come from glass fabrication, because of the additional capacity in St. George and the conversion of the auto glass facility. Those provide us with a couple of nice tranches of growth opportunities for the glass side.

The installation side is more about growing bottom line than it is top line. I believe top line will grow. I'm not going to constrain that, but I am certainly looking for better -- continued improvement in selectivity that gives us better operating margins and the ability to execute projects that fit our core competencies.

Are you satisfied now -- you have a Northern site on the glass side; you have a Southeast site; you now have a Southwest site. Are you looking at maybe a Northeast or a Northwest area as possibilities further out in the future, or are you satisfied with what you have today?

We believe that there are opportunities, or will be opportunities. When you look at the Dodge data showing these markets continuing to be strong through our fiscal year 2013, we think we can continue to incrementally improve capacity with smaller investments, and we also think that combined with that, we can leverage suppliers to help enable us to increase capacity where we have some constraints.

So where we have constraints, and we're able to do some outsourcing, so we're trying to do all these things, and clearly, as you point out, controlling the capital investments as we go through this top end of the cycle.

The last thing is that you have in the past commented at least in regards to more value-added glass going into buildings and projects even at a smaller scale -- any kind of data or any way to quantify where we stand today and what it looks like going forward as far as using more energy-efficient glass, the building codes, those things as opposed to a one-story, two-story office building that just has standard glass in it?

I have to say to you that it is anecdotal, but it is somewhat factual -- as we talk to people around the industry, there is no question that high-performance glass continues to become a greater percentage of total glass used in commercial projects. So that is -- but I don't have hard numbers on it. It is hard to get at the hard numbers, but there is no question in my mind that that is happening and we're benefiting from that.

One number that we do look at is the number of lead projects or this green movement that is taking place in commercial construction, and what was tens and a couple hundred projects a couple of years ago are now turning into thousands of projects that are applying for LEED certification and energy efficiency, and there's no question that we are seeing that across the board.

We reviewed a small project recently here in the Twin Cities, in St. Paul, that is a philanthropic foundation. They are building a new small office building, and very intent upon building that to a LEED -- premium LEED level. So that trend is absolutely positive and in our favor, and we think that it will continue.

So your point is good. I wish I had harder data to be able to give you. We do search for that. But based on the people I'm talking to in the industry, and that knowledge, there's no question this is becoming a more important factor.

Scott Blumenthal, Emerald Advisers.

Just one or two follow-ups. Jim, I noticed that the debt level is going to pretty much stay flat or maybe go up a little bit, you mentioned in your prepared comments. Can you give us kind of a weighted average cost of debt at this point, or maybe give us an idea of what the net interest expense, interest income is going to be for the year?

Yes, our weighted average debt is probably a little over 6%.

Thank you. And one more, if I may. Russ, you mentioned that you have had the ability to be opportunistic on what you are bidding on worldwide, and I was wondering if you can give us any idea how much business you are actually having to turn away now because of lack of capacity, or I guess conversely because it doesn't fit what you mentioned as your core competencies or your profit goals?

We know that it is substantial. I think I have made the comment before that if we had the $40 million in capacity in St. George up and fully running, we would be able to sell it. So I think that is probably the best measure that I could give you today of -- it is likely even more than that, but we feel confident that that would be sold if we had it.

Can you give us an idea of what's the scale or the scope of the two segments that you're planning on exiting, the RV/bus windshields and the preframed art product line?

The preframed art product line, that product line was about $8 million in revenue annually. And then the RV and bus portion of our auto glass segment was roughly about $10 million of annual revenue.

And the RV and bus is part of the facility that is going to be converted to architectural glass?

That's correct.

At this time, there are no further questions in the queue. I would now like to turn the call over to Mr. Russ Huffer. Please proceed, sir.

Thank you, and thanks for your questions today. Certainly, we are pleased with our fiscal 2007 results, and we continue to execute our strategies. Our business is improving and our key markets are strong. We are excited about the opportunities for Apogee in fiscal 2008 and beyond. Thank you, and have a great day.

Thank you for your participation in today's conference. This concludes the presentation. You may now disconnect. Good day.