Atlas Critical Minerals Corp (ATCX) 2021 Q4 法說會逐字稿

Hello, and welcome to the Atlas Technical Consultants Fourth Quarter and Full Year 2021 Conference Call. (Operator Instructions)

I would now like to turn the call over to your host, David Quinn, Chief Financial Officer of Atlas. Thank you. You may begin, Mr. Quinn.

Thank you for joining us. We hope that you have seen our earnings release issued after the market closed today. Please note that we have also posted an updated investor presentation in support of this call, which can be found in the Investors section of our website at oneatlas.com.

Before we begin, I would like to remind you that today's call may include forward-looking statements. Any statements describing our beliefs, goals, plans, strategies, expectations, projections, forecasts and assumptions are forward-looking statements. Please note that the company's actual results may differ from those anticipated by such forward-looking statements for a variety of reasons, many of which are beyond our control. Please see our recent filings with the Securities and Exchange Commission, which identify the principal risks and uncertainties that could affect our business prospects and future results. We assume no obligation to update publicly any forward-looking statements.

In addition, we will be discussing or providing certain non-GAAP financial measures today, including adjusted EBITDA, adjusted EBITDA margins, adjusted net income and adjusted EPS. Please see our earnings release and filings for a reconciliation of these non-GAAP measures to their most directly comparable GAAP measure.

I will now turn the call over to our Chief Executive Officer, Joe Boyer.

Thank you, David, and I appreciate everyone joining us today. On today's call, I'll provide an overview of our fourth quarter results and talk about our strategic priorities, including the acquisition of TranSmart, which we had announced this afternoon. David will continue with the discussion of our financial results and our 2022 outlook before we open up the call for questions.

The fourth quarter was a strong end to an exciting year for Atlas. We delivered robust growth, expanded EBITDA margins, we generated strong cash flow, and reduced our debt balance and leverage ratio. We also ended the quarter with record backlog, including the largest award in the company's history, which combined with the growing demand we are seeing in our services across all of our key end markets, position us well for 2022 and beyond.

In the fourth quarter, we delivered over 15% revenue growth and 34% adjusted EBITDA growth as compared to the fourth quarter of 2020, both to record levels. This led to a full year revenue and adjusted EBITDA growth of 15% and nearly 17% respectively. Importantly, our growth in the quarter and the year was driven by a combination of factors, both internally and externally. We continue to see robust end market demand in all of our key service areas, which we've been able to enhance with our ongoing cross-selling initiatives contributed from recent acquisitions.

We have and will continue to implement pricing increases to cover transitory labor cost pressures. And even with these headwinds, I'm proud to say we delivered expanded adjusted EBITDA margins. We expect further improvement in our margins as our business scales and these pricing actions flow.

We had a very strong quarter for winning work and entered 2022 on solid footing. Our fourth quarter backlog again rose to a new record level of $808 million, up 29% compared to the end of 2020. This growth was fueled by new major infrastructure and environmental-related contract awards and included growth in all service lines. Our book-to-bill in the quarter was 1.4x, an impressive feat as we had a record level of quarterly revenue.

One of the large projects that we converted in the quarter and the largest award in Atlas history, and I'm proud to have in our portfolio is the New York MTA Penn Station Access project. This $115 million contract will provide direct metro north service from the Bronx, Westchester and Connecticut to Penn Station and Manhattan's west side, providing connectivity to historically underserved communities. And we are in a JV with WSP on this project, but will provide project management services, including construction management, design oversight, operations management and commercial management to oversee the design build team.

Now this project is a great example of revenue synergies obtained through the integration of technical resources and capabilities from acquired companies. Our success in winning these large marquee projects is directly related to adding enhanced value to customers as we utilize the broader full technical service capabilities of one integrated Atlas. These large professional service-based projects are low risk and drive growth in our backlog while providing longer term visibility and predictability into future revenues and cash flows in addition to the thousands of smaller projects that we have built the foundation of our business on and account for a significant portion of our work.

Another great example of this type of project is the 5-year $5 million environmental services contract we recently announced with ConocoPhillips to assess and remediate petroleum impacted soil and groundwater associated with legacy oilfield activity. ConocoPhillips is a long tenure repeat client and we look forward to continuing to provide them with our growing portfolio of technical services.

Now beyond our current backlog, we still have nearly $125 million of awards that are pending contract execution. As we look into the remainder of 2022 and beyond, we are as optimistic as I've ever been about the outlook and fundamentals driving our business. Secular trends such as aging of the nation's infrastructure and an increased focus on environmental sustainability, workplace safety among both our public and private clients continue to drive demand for Atlas services. Additionally, we're optimistic that we'll begin to see projects funded by the $1.2 trillion Infrastructure Investment and Jobs Act begin to materialize in late 2022 with acceleration to 2023.

Now let me discuss our strategic priorities for 2022. First, we'll continue to utilize our broad service offerings and national footprint to capitalize on strong fundamentals in our market and drive organic growth. We've had success in our cross-selling strategy, but a meaningful opportunity remains and will continue to work diligently to offer our diverse customer base with the services they need from all across our company. Whether it's connecting smart cities, protecting our environment, making the places we live and work safer and cleaner or other technical services, Atlas is uniquely positioned to benefit from ongoing investment in new and existing infrastructure for many years to come.

Second, we will continue to drive our M&A strategy. Today, we announced the acquisition of TranSmart, a technology leader in the intelligent transportation systems as well as connected and autonomous vehicle space, a market that is expected to grow at least 12% annually through 2030. This acquisition fits well within the Atlas portfolio as these services we provide are critical to improving the efficiency and the effectiveness of existing and new transportation infrastructure. This offers a great example of how we plan to cross-sell throughout our portfolio.

Although TranSmart business was predominantly been in the Midwest, we are confident we can leverage the company's technology-driven expertise in other key regional markets where we have a strong presence, such as Georgia, Texas, New York, Florida and California. Further, we have increased access to TranSmart's relationships with transportation customers in the Midwest, where our business has largely focused on environmental remediation.

Our M&A pipeline remains active. We're focused on adding companies with differentiated services that add to or enhance our existing service offerings and our geographic footprint. We believe Atlas offers an attractive platform for these companies given our scale and our national footprint and expect to announce additional acquisitions in the near term.

Our third strategic priority is to continue to make progress with improving our capital structure. Our strong financial results, combined with a strict focus on working capital management led to a record free cash flow in the fourth quarter. This allowed us to reduce our debt, and we ended the year with a net leverage ratio of nearly a full turn lower and where we were post our recapitalization early in 2021. Going forward, the goal is to reduce net leverage to less than 3x through a combination of organic growth, cash generation and deleveraging M&A.

And our fourth priority is our commitment to ESG. This is a priority for us, both as a company and as we help our customers meet their ESG requirements. As a company, we believe we have strong governance practices. We're committed to diversity and inclusion and tie safety and environmental awareness to all that we do. We are in the process of developing more formal ESG goals, which we plan to provide updates to later in the year.

Additionally, I'll reiterate that the services Atlas offers are aligned with many of our customers' ESG goals, and we're committed to providing safe and healthy infrastructure and sustainable and resilient systems through our quality management and environmental assessment and mitigation work. So we believe these priorities and initiatives are the key factors for Atlas to drive value to our shareholders. We'll continue to update on our progress going forward.

So with that, I'll turn the call back over to David to provide details on our financial performance and our outlook.

Thanks, Joe. I'm very excited to be discussing our record performance in the quarter and to be presenting a robust 2022 outlook.

So let's begin with Q4. Our business delivered record gross revenue of $145.2 million in the fourth quarter of 2021, which was up 15.5% compared to the prior year quarter, driven by strong performance in all of our service areas, solid end market fundamentals, including 4% organic growth and contributions from acquisitions.

Net revenue of $114.1 million was up 12.5% higher than the prior year period as we had select larger projects with more subcontractors contribute to gross revenue in the quarter. Record adjusted EBITDA of $20.7 million was up 33.9% from the last year and represented 18.1% of net revenue compared to 15.2% in the prior year quarter.

Adjusted EBITDA margin expansion was driven by operating expense leverage as we continue to scale the business, although it was in part mitigated by project mix and timing of passing increased costs through to customers. As Joe mentioned, we expect the impact of higher labor costs to be transitory as over 90% of our contracts are cost reimbursable.

For the fourth quarter, we produced adjusted net income of $2.1 million and adjusted EPS of $0.06 versus a loss of $0.23 in the prior year quarter, with some differential in EPS related to the conversion of Class B to Class A shares over the past year.

Moving on to cash flow and the balance sheet. During the fourth quarter, we generated record cash flow from operations of $26.9 million resulting in full year cash flow from operations of $29.1 million. A strong cash flow in the quarter was driven by improved working capital management, which remains a priority for us in 2022 and beyond.

Net debt at the end of the quarter was $463 million, down from $486 million at the end of the third quarter. Debt reduction included paying down the balance of our revolver by nearly $30 million. And consistent with this, reduction of debt and debt expense is a key priority for us. And with this, we have made the strategic decision not to pick 2% of interest expense in 2022 and instead service it with cash.

As expected, our net leverage at year-end was approximately 5.9x, in line with the expectation we set last quarter. Our bank covenant ratio, which includes both cost efficiencies and pro forma EBITDA from acquisitions was 5.45x, nearly a full turn lower than we were following our recapitalization in February 2021. As Joe indicated, we remain laser-focused on continuing to strengthen our balance sheet through a combination of organic growth and deleveraging M&A and continue to target a sub-3x net leverage level over the longer term.

Moving to our outlook for 2022. We expect revenue to expand to a range of $580 million to $620 million, an increase of 11.5% at the midpoint as compared to our 2021 results. This outlook reflects the continued strength of our backlog and visibility on timing of work, the strong market tailwinds we see and the contributions from acquisitions. We anticipate that adjusted EBITDA will expand to a range of $84 million to $90 million. This represents growth of 19% at the midpoint as compared to 2021 results.

As you can see from our guidance, we expect solid top line growth and even greater profitability and margin growth. We are extremely excited by the outlook for our business moving forward.

And with that, I'll now turn the call back to Joe for closing remarks.

Great. Thank you again, David. To sum it up, 2021 was a very solid year for Atlas. We delivered record revenue and EBITDA in the fourth quarter and for the full year. We plan to build on this momentum and 2022 is shaping up to be another record year for Atlas. We ended the year with a robust backlog, solid end market fundamentals and an active M&A pipeline. I'm very proud to represent Atlas' more than 3,600 employees. We're fully committed to delivering mission-critical projects throughout the U.S. in a safe and sustainable manner.

So thank you again for joining us today. Operator, we can now open up the lines for Q&A, please.

(Operator Instructions) Our first question comes from Chris Moore with CJS Securities.

The gross revenue range, $580 million to $620 million, can you maybe just talk a little bit about kind of the drivers that would get you closer to the higher end and the midpoint is 11.5% growth. What does that represent on an organic basis?

Good, Chris. Thanks for the question. Yes. So revenue range of $580 million to $620 million, as you mentioned, implies like 11.5% at the mid. And first and foremost, us achieving that is backed by again, another record backlog at $808 million. Put this out another high of 135% of forward-looking revenue for next year. In addition to that, we've introduced some large contract wins to the portfolio. We announced the New York MTA Penn Access contract.

It's the largest contract that we've secured in our history. So that is certainly an example of a project that can help drive revenue as we're able to accelerate it. In addition, we added TxDOT, I-35 to our portfolio, another great project in Texas. And even things like our Amazon warehouse and logistics project, which is in Rhode Island. We're starting to really build a little bit of a trend securing new logistics type work.

So these types of things are really going to be the drivers that push us this year to get closer to the top end that and of course, acquisitions come into play too. Ultimately, if you look at our overall growth of 11.5%, we're still sticking to our strategy of 50% of our growth being based on acquisitions and 50% being organic. So our organic growth is targeted somewhere in the 5% to 7% range.

Got it, very helpful. Maybe you can just talk a little bit about the expected cadence in '22, both from a revenue and a free cash flow perspective kind of on a quarterly basis, is it sequential improvement or how should we look at that?

Yes, it will be sequential improvement. We've always talked about the seasonal nature of our business. Our third quarter tends to be our most field-intensive season. So that's our strongest season. Second to that is usually our second quarter. And then you see our fourth quarter sort of coming in third as we wind into the holidays.

And the first quarter tends to be our ramp-up season as we come out of the holidays, we got a little bit of winter activity going on, and we get ready for the ramp up in the second quarter.

And from a free cash flow perspective, looking at '21 with a really strong Q4. Is the free cash flow likely be back half loaded or how should we look at that?

Yes, it will always be back half loaded for us, particularly because as we grow, you're really seeing in the evidence of our growth peak in the third quarter of each year. So we'll have a heavy third quarter, maybe drawn a bit of working capital, and we'll convert that in the fourth quarter, similar to what we did this year.

Our next question comes from Noelle Dilts with Stifel.

Congrats on the strong end of the year.

Thanks, Noelle. Appreciate that.

Sure. So I was hoping, first, you could start just a little bit, if you could provide a little bit more detail on the Penn Station contract. I want to make sure I'm thinking about this correctly. It looks like $115 million, 86-month contract plus an option to extend, but it looks like that was awarded to the JV. Could you just talk about how we should think about the specific contribution to Atlas?

Sure, no, I think one way to look at that is we are in a 51%, 49% JV with WSP on that, just to give you a general scope. We've taken into backlog $56 million on that project, okay? So that will essentially be the Atlas piece of that JV revenue expected over the period of the contract.

Okay. And sorry, and I also meant to ask and how it kind of just ramped over that period? Do you expect it to be sort of a lower contribution in year 1 or how should we think about that?

Yes, it's going to be -- the project is currently over an 8-year period. It's just in the initial stages as the design build team begins to complete their design. Obviously, our work increases. So it's more of a back office program manager and commercial effort in the first, I'd say, 6 to 12 months there. And as the design starts to get completed into the field, you'll see our services pick up and increase in years 2, 3, 4, 5 and beyond.

Perfect, okay. And then I was hoping you could expand a little bit just on what you're seeing from an end market perspective, particularly on the commercial side and if there's any sort of notable trends that you're seeing in e-commerce and data center and some of the other markets that have been pretty robust across the commercial construction sector recently?

Sure, Noelle we are seeing -- remember, we're roughly 50% public, 50% private. We have seen quite a bit of pickup in increased construction activity with the acquisition, refinance and development activities in the commercial side, which are benefiting our -- basically our tick, our due diligence and building science side of the business. So as David mentioned, our new Amazon project is just an example of that.

But across the board, we are seeing more construction activities, I would say, in our public markets, particularly in local municipalities and state agencies really demonstrating an increase in lettings we're seeing at the city and county municipalities level, a real steady progress in activity and the bidding opportunities there. In general, in the public market, and our transportation markets are steady with really some larger transportation and environmental projects on the horizon for us.

As I mentioned, we see really improvement in our environmental building sciences and due diligence and compliance areas across the board with increased construction activity. I think -- the one last thing I'd say to that is we're seeing power projects continue to be a steady increase in momentum. We see significant energy projects going forward at Hanford and Idaho National Laboratories and tariff power project in Wyoming.

And so that and our retail petroleum markets are strong. So in general, our retail petroleum markets been fairly steady with our clients' spending money on reimaging their stores and continued compliance, environmental compliance. I hope that gives you a little bit of picture there.

Our next question comes from Rob Brown with Lake Street Capital Markets.

And I'll add my congratulations on a nice quarter as well. Just a little bit on the M&A pipeline. I think you mentioned a couple of things in the pipeline. What areas are you focusing on and how do you sort of see that playing out for '22?

Rob, Jonathan Parnell here Chief Strategy Officer. Look, I think you see with the TranSmart acquisition, it exemplifies our strategy. We're adding technical capabilities to provide rich cross-selling opportunities to us and position us in target geographies with strong funding tailwinds. So that's where we're going to continue to focus.

In terms of the pace of M&A, as you well know, Rob, you know the story well. It's part of our DNA and a key pillar of our growth strategy. So our pipeline is very active, and we anticipate continuing to fuel the 50% of our growth target through M&A.

Okay great. And then on the margin ramp that you think you can kind of get to the margin recovery, I should say, with some price increases. How do you sort of see that playing out over the year? And should it be a steady increase or should it sort of snap back pretty quickly?

Yes, great question, Rob. So very pleased with the step-up that we delivered during fiscal 2021. We moved the business 400 basis points from where we were in 2020, ended up almost 17%, 16.8%. So for 2022, it will be sort of a steady climb with the exception of Q3, you'll start to see it really bounce relative to scale. As I mentioned earlier, that's our biggest quarter.

So looking ahead, we expect again record revenue levels next year, $580 million to $620 million. As we've talked about several times, we've instituted pricing increases with our clients, and we're getting real traction with that. And we're continuing to drive operating efficiencies across the business, which are contributing to our margins.

Again, for the full year next year, looking at 18.1%, which is up 1.4 percentage points year-over-year at the mid of our guidance. So we're pretty excited about it.

Our next question comes from Brent Thielman with D.A. Davidson.

Maybe just to pick up on the guidance and the implications for margins, which sound like roughly 100 bps better in 2022? Is there any favorable mix component to achieving those margins? Or is this strictly some recapture of these higher expenses you've been incurring in the last few quarters and effectively the contracts in the book of business today reflecting that?

So I think your question is more around the project types that we're executing more on the growth side of things. And what I would say, Brent, is that we are seeing the benefit of larger contracts coming into our backlog. And with that, there's a work mix benefit to it as well, which builds on our already low operating leverage. If you think about the dynamic, we're adding large groups of dedicated resources to bigger longer-term contracts.

So with that, we gain utilization efficiencies. And we're also tending to see that the recent large contract awards we've secured are coming through our PCQM and E&D service offerings, which really continued to outperform from a project gross margin standpoint. So overall, we're basically seeing the benefit both in terms of gross and EBITDA margins with these new larger contract awards.

Got it, that's super helpful, David. And then I'm curious, are you seeing any impact to the timing of new bids? In particular, I'm thinking about some of the public agencies, the DOTs out there just related to some of this inflation that we're seeing all, seeing there in the environment right now and some resetting of costs or has it been business as usual?

Rob, this is Joe -- Brent, sorry. Consistent with [proper sorry]. Leave it to me. Brent, I'm sorry for that. Brent, I think what we are seeing is actually the transportation business is really getting back to normalized levels for us. Actually 2021 was a little slow as they pulled back from the 2021 growth. So we're actually seeing projects being let and awarded fairly quickly, so moving out. So I think the clients are -- our clients are active work in full force, and we're seeing lettings and awards come up pretty consistently.

That's great. Joe. And I mean any glimpse into what maybe your subsidiaries, the boots on the ground are starting to see develop behind the scene just related to this, yes the federal infrastructure funding? Is there much more planning going on at the agency level?

Are there any early contracts that are starting to come out and surface that they are being supported by that funding? I know you've talked about it coming later in the year, but perhaps there's some evidence that's showing up a little earlier?

Yes, that's a good question. I think we can say what we do see, is our clients looking for complete use of their current contract capacities, right. They're really trying to squeeze everything they have at the current capacity, which speaks to just speed of getting work done. I think there are plans to put out new contracts, so there's, discussions around that.

But to be honest, probably not enough significance yet for us to have real clarity on the infrastructure bill revenues yet. So we still think in late '22 into 2023. But our clients are definitely utilizing current contracts to push through more projects from what we're currently seeing.

Got it. And maybe just the last one I mean, you talked about in prior quarters, just this challenging kind of hiring and I guess, retention environment as well. Maybe just an update kind of where you feel like the business is. You're obviously sitting on record backlog, a lot of work to do. But what do you -- do you feel like you're on a better footing now, Joe, than where you were a quarter or 2 ago, just with respect to that those issues?

Yes, I think as I said and you know we have a steady recruiting base here at Atlas and we've had them for years, and they've been very, very successful with keeping up and staying ahead of our resource demand. But I will tell you that it is on a more stable footing there.

It appears to us now. Everybody is facing some form of labor challenges. But we're much more optimistic. The work has improved our utilization and number of people headcounts include, so on a much better footing going forward.

Our next question comes from Kathryn Thompson with Thompson Research Group.

This is actually Brian Biros on for Kathryn. I guess, first one in the -- again, on the guidance for '22, how are you thinking about the different segments of the business in that guidance. Guidance, I think, was this midpoint 11.5%. You mentioned 5% to 7% organic. How does that kind of break out across the segments, either on a percentage growth or rank order from strongest to weakest?

So Brian we, so we don't run our business based on segments. I think the closest thing to a segment might be if we were to speak to it relative to service offerings. And if you look at the trends we've been seeing with the business.

As I mentioned earlier on the call, we've seen a real uptick with our PCQM and E&D side of the house. So I think that's where we're going to continue to see strong emerging growth. But Joe, I'll turn it over to you to pick this up.

No, I think you covered it well. I think we're still seeing strong environmental performance in our business at roughly 1/3 of our business, 35% of our business anticipated that to be the case in 2022. Our PCM, so our large program management side of our business, is improving to 17%, 18% of our business so some growth there as well.

So -- but just broadly, just general market upticks across all 4 of our service lines as well as broad and even distribution across our end markets as well.

Got it. That's helpful. More just here, I'm trying to understand if there's a standout among those. The second question on the large contract, again, from the Penn Station project, large project, long contract. It seems like a big deal. It's a mega project given the scale and the visibility that Penn Station has. Can you kind of just talk about what attributes or drivers for Atlas winning that project?

Sure, I think without trying to take what's out and made public on the MTA's procurement, I think it's set to state that's a combination of WSP and Atlas and their strength of their resume, their capabilities in rail, the number and quality professionals in New York experienced in this area and having relationships with the MTA, having experience in with the MTA clearly led to us winning that project, I think.

Our next question comes from Don Crist with Johnson Rice.

One quick question since a lot has been asked already. On the TranSmart Technologies acquisition, what type of cross-selling opportunities do you think you have there? And do you think any of that's baked in the guidance that you gave today?

Don, Jonathan Parnell here. We have -- this acquisition bring really rich cross-selling opportunities because the work is highly transportable across our platform. So we expect to be able to transport these services, offer these services in geographies like California, Texas, Georgia, Florida, where they're currently only operating in the Midwest.

So we do expect to drive revenue synergies off of this acquisition. I would say that typically takes a little bit of time to mature as we integrate these acquisitions. So I wouldn't expect a ton of revenue synergies in year 1.

Okay. I think everything else has been asked, but I appreciate the time.

Our next question is a follow-up from Chris Moore with CJS Securities.

Yes, just one more follow-up on TranSmart just trying to get a sense kind of for the scope here, 100 employees, $20 million revenue, is that way aggressive? Is that a reasonable ballpark? I'm just trying to get a sense of kind of where they are now and you talked about that 12% growth in the market with all the opportunities. Anything you could say on the current revenue?

Yes, so Chris, we'll contain reserve providing guidance on individual -- at an individual transaction level for our smaller bolt-on deals. That being said, I mentioned that our growth will be driven 50% organically and 50% acquisitively. And beyond that, you can do some analytics on head pound, translate that to revenue. It's not going to be too disparate from the balance of our business.

Got it. And just in terms of -- you said the market that they're in is growing about 12%. They've been matching that in the last 5 years, something like that?

Chris, Jonathan Parnell. They've been growing at a fast pace. Like us, they've done some acquisitions as well, but we expect to drive rapid growth, not only -- of course, we want to drive this business at 12% growth. That's a high part to achieve, but we think it provides some rich opportunities for us to cross-sell these services and grow them at a rate faster than they were growing.

Ladies and gentlemen, I apologize, we do have one more follow-up from Noelle Dilts with Stifel.

So 2 additional questions. So first, curious how we should think about how you're thinking about self-perform work versus outsourced versus next -- for next year? And second, I was wondering if Jonathan could comment a bit on if you're seeing any elevated competition for targets in the market or continued creep in multiples, just what you're seeing in terms of pricing?

Great Noelle yes, I appreciate the question. And obviously, this has been a priority for us. We've been efforting this hard over the last 2.5 years. And as a result, we've been able to drive our self-performance from, call it, maybe high 77% up to where we are now, 80% to 81%. We're going to continue to press this along. And if I'm looking to full year 2022, I think maybe we'll squeeze out another point, get up to 81.5%, 82%.

And I think that's consistent with what we've discussed at a certain point. You're going to start popping out because there are things that are outside our risk profile that we're just not going to try to do. And we're going to stick to what we're best at.

That makes sense.

Noelle, in terms of the pricing competition, when the infrastructure bill was passed, you really saw an uptick in competition. A lot of people are trying to get into this space. But we're still finding plenty of opportunities in the 4.5% to 6.5x EBITDA range that we've discussed in the past.

Our national presence really provides us with a great connections into proprietary M&A deals with some market-leading firms. So that's filling our pipeline, keeping our pipeline very active, and it's going to allow us to continue to be disciplined, both in pricing and deal structure to ensure that we're doing deals that are highly deleveraging and accretive to the company. I hope that's good.

Ladies and gentlemen, we have reached the end of the question-and-answer session. And I would like to turn the call back to Mr. Joe Boyer for closing remarks.

Thanks very much. I want to thank everybody for joining us today, and we appreciate your support of Atlas and look forward to updating you on our progress. Thank you very much.

This concludes today's conference. Thank you all for your participation. Have a great day.