Aspen Technology Inc (AZPN) 2015 Q1 法說會逐字稿

Ladies and gentlemen, thank you for standing by and welcome to the first-quarter 2015 earnings call. (Operator Instructions)

Thank you. I would now like to turn the call over to Mark Sullivan, Chief Financial Officer. You may begin.

Thank you. Good afternoon, everyone, and thank you for joining us to review our first-quarter 2015 for the period ended September 30, 2014. I'm Mark Sullivan, CFO of AspenTech, and with me on the call today is Antonio Pietri, President and CEO.

Before we begin, I will make the usual Safe Harbor statement that during the course of this call, we may make projections or other forward-looking statements about the financial performance of the Company that involve risks and uncertainties. The Company's actual results may differ materially from such projections or statements.

Factors that might cause such differences include, but are not limited to, those discussed in today's call and in our Form 10-Q for the first-quarter fiscal year 2015, which is now on file with the SEC.

Also please note that the following information is related to our current business conditions and our outlook as of today, October 28, 2014. Consistent with our prior practice, we expressly disclaim any obligation to update this information.

The structure of today's call will be as follows: Antonio will discuss business highlights from the quarter, then I will review our financial results for the first quarter and our guidance for the second quarter and fiscal year 2015, before we open up the call for Q&A.

With that, I would like to turn it over to Antonio.

Thanks, Mark, and thanks to everyone for joining us this afternoon. Overall, we delivered a solid first-quarter performance, with results that exceeded our guidance across all metrics.

Looking at our financial results for the quarter, we reported total revenue of $107.1 million, $2.1 million above the high end of our guidance range; non-GAAP operating income of $49.1 million, which represents a non-GAAP operating margin of 46%; non-GAAP earnings per share of $0.35, which was $0.05 above the high end of our guidance range; and free cash flow of $37 million.

From a sales perspective, we continued to see strong usage growth across our three core verticals in the first quarter. This contributed to PLCB growth of more than 11% year over year, which tracks above our full-year guidance of double-digit growth. As we have discussed in the past, the first quarter is typically the smallest sales quarter for AspenTech and this year was no different in that regard.

We have gotten off to a strong start in the current quarter and have a sales pipeline that remains robust and is growing, which we believe positions us well to deliver against full-year TLCV growth guidance. From a macro perspective, the macro economic and political environments remain uncertain on a global basis, though, as I just noted, we continued to see strong demand from customers in our target markets.

Positive demand trends, including increased energy demand driven by the continued expansion of the global middle class and the proliferation of natural gas production through shale exploration, continued to benefit us globally across our three core verticals. The combination of these positive demand drivers, the mission-critical nature of our software, the value we generate for customers, and the long-term nature of our contracts position AspenTech well in volatile economic climates, though we recognize that we would not be immune from a material worsening of the macro environment.

During the first quarter, energy, engineering and construction, (technical difficulty) once again represented greater than 90% of our business. Energy was the largest vertical contributor, followed by engineering and construction and chemicals. Looking at our 10 largest transactions in the quarter, there was again a mix of engineering and manufacturing supply chain deals and both product suites generated positive performance.

We continued to make good progress in expanding both the number of users of aspenONE as well as the number of products used per user across our install base. These opportunities to expand both the breadth and depth of usage among our customers is a significant driver of our expanding pipeline of opportunities.

During the quarter, we continued to bring exciting new innovation to market with the release of aspenONE 8.7. In this most recent release, we have enhanced the new version of our DMC3 advanced control technology product with the adaptive control functionality.

With this enhancement, we are ensuring that advanced control applications can adapt to rapidly changing process condition and continuously reflect current operational conditions and business drivers. As we highlighted at our analyst day in the spring, Adaptive Process Control is a significant product innovation that is unmatched in the market and provides approximately $300 million of potential incremental TLCV opportunity for AspenTech.

We also released the latest version of our PIMS-AO software, which leverages improvements in parallel processing, nonlinear modeling, global optimization, and feedstock basket reduction to allow feedstock planning to occur up to eight times faster, driving increased confidence in planning decisions and maximizing profits.

Lastly, we introduced automated pipeline scheduling, which extends our Aspen petroleum scheduler functionality down to ancillary terminals to ensure the accurate tracking of inbound and outbound pipeline movements.

This would provide greater visibility and accuracy of pipeline movements, which will enable better and more profitable decision making. This product innovation builds off the pipeline scheduling and dock scheduling acquisition we made in 2013 and is a great example of the significant opportunity we have to introduce new solutions that leverage our existing bid relationships and product footprint with our customers.

As we look ahead, we believe there is an opportunity to leverage AspenTech's nearly $2 billion install base of products and solutions that is pervasive in our customers' operations. This install base holds significant amounts of operational data, the design and operational models of customer assets, and the information generated that our customers use to manage and optimize their operations.

We continued our research effort to create a new set of products that will leverage the widespread adoption of our solutions to create vertically and specific operational analytics.

The investments we have made in our R&D organization are further enhancing our industry-leading aspenONE platform and making it even easier for customers to generate substantial cost savings across their production processes. We will continue to invest in R&D in order to effectively drive incremental growth through expanded usage opportunities.

We are also continuing to invest in our sales and marketing organization, specifically in higher growth regions like the Middle East and Russia, and to support our SMB sales force and the Euro marketing strategy. In particular, our small and medium business sales forces' increasing focus on owner-operator customers is beginning to produce positive results. All of these initiatives are generating a strong returns and incremental growth opportunities for AspenTech, which we expect to continue.

Our scalable business model enables us to make this incremental investment while continuing to generate margin expansion and substantial free cash flow. The combination of our solid financial performance and strong balance sheet provides flexibility to drive additional shareholder value through acquisitions and stock repurchases.

In the first quarter, we spent $45 million to repurchase more than 1 million shares. We will continue to leverage our strong financial position to generate shareholder value.

In summary, we posted solid first-quarter results and believe we are well positioned to achieve our full-year financial target. Our core verticals continue to benefit from positive demand drivers and we see a significant runway to drive continued growth and profitability going forward.

We remain focused on driving operational excellence across the organization to ensure we maximize this opportunity and I am confident in our ability to execute on our strategy.

With that, let me turn the call over to Mark. Mark?

Thanks, Antonio. Let me begin by reviewing the supplemental metrics we provide, starting with our term contract value, or TCV metric, which measures the renewal value of our multi-year term contracts. Growing TCV is a key focus for us and (technical difficulty) value of the metric by adding new customers, expanding product usage, and increasing prices across our customer base.

Our license-only TCV was $1.88 billion at the end of the quarter, up 11.3% compared to the first quarter of fiscal 2014 and up 1.7% on a sequential basis. Total term contract value, which includes the value of bundled maintenance, was $2.23 billion at the end of the quarter, up 12.5% on a year-over-year basis and 1.7% sequentially.

Our annual spend, which is a proxy for the value of our recurring term license business at the end of each period, specifically the annualized value of our term license and maintenance revenue, was approximately $385 million at the end of the quarter, which is an increase of approximately 11.2% on a year-over-year basis and 1.4% sequentially.

As we come to the completion of our revenue model transition in fiscal 2015, annual spend will become an increasingly important metric, as it is a leading indicator for growth in subscription revenue, which represents more than 90% of our total revenue.

License TCV is calculated using each contract's terminal year annual payment and therefore takes into consideration the total price escalation over the course of a multi-year time period, whereas annual spend only takes into consideration the current year's level of spend. The growth of our annual spend metric should be slightly lower than the growth in our license TCV metric, though there can be some quarter-to-quarter variability.

As a reminder, beginning in fiscal 2016, we will be providing annual spend growth guidance and quarterly annual spend results.

Now let me turn to our quarterly financial results on a GAAP basis. Total revenue of $107.1 million was up 22.3% from $87.6 million in the prior-year period and was above the high end of our guidance range.

Breaking this down further, subscription and software revenue was $98.7 million for the first quarter, which is an increase from $78.7 million in the prior-year period and $91.6 million last quarter. Services and other revenue was $8.4 million compared to $8.9 million in the year-ago period and $10 million last quarter.

Turning to profitability, gross profit was $94.7 million in the quarter, with a gross margin of 88.4%, which compares to $75.5 million and a gross margin of 86.2% in the year-ago period. Operating expenses for the quarter were $50.1 million compared to $50.6 million in the prior-year period.

Total GAAP expenses, including cost of revenue, were $62.5 million, basically flat from $62.7 million in the year-ago period. On a sequential basis, expenses were also flat compared to $64.2 million last quarter.

Operating income was $44.6 million for the first quarter of fiscal 2015, an increase compared to operating income of $24.8 million in the year-ago period. Operating margin was 41.7% for the first quarter of fiscal 2015 as compared to 28.4% in the year-ago period.

Net income for the quarter was (technical difficulty) or $0.32 per share compared to net income of $15 million or $0.16 per share in the first quarter of fiscal 2014.

Turning to our non-GAAP results, excluding the impact of stock-based compensation expense, restructuring charges, amortization of intangibles associated with acquisitions, and non-capitalized acquired technology, we reported non-GAAP operating income for the first quarter of $49.1 million and non-GAAP net income of $31.8 million.

This compares to non-GAAP operating and net income of $29.5 million and $18 million, respectively, in the year-ago period. Our non-GAAP EPS was $0.35 in the first quarter of fiscal 2015 based on 91.9 million shares outstanding compared to non-GAAP EPS of $0.19 based on 94.5 million shares outstanding in the first quarter of fiscal 2014.

Non-GAAP operating margin was 45.8% for the first quarter of fiscal 2015 as compared to 33.7% in the year-ago period. Fiscal 2015 is the final year of the revenue transition that began in fiscal 2010. Our profit margins, which weren't meaningful while we were moving through the revenue transition, are now more reflective of the true earning power of the business, even though GAAP revenue will still be slightly understated in fiscal 2015.

As a reminder, we presented an updated target operating model at our May investor day, with a gross margin target of 87% to 90% and a non-GAAP operating margin target of 42% to 45%. First-quarter margins compare favorably to these targets.

I will have some additional comments on full-year profit margins when I discuss guidance for the fiscal year.

Turning to the balance sheet and cash flow, the Company ended the first quarter with $289.1 million in cash and marketable securities, a decrease of $9.3 million from the end of last quarter. We generated $39.9 million of cash from operations during the first quarter and $37 million of free cash flow. This was offset by $45 million that was used to buy back stock in the quarter.

Our cash flow performance in the first quarter was positively impacted by strong collections, which resulted in a historically low overdue receivables balance. Accounts receivable were $24.8 million at the end of the first quarter as compared to $36.2 million at the end of the year-ago period. Capital expenditures totaled approximately $2.9 million in the first quarter, of which $2.4 million was related to the buildout of our new headquarters building.

As a reminder, in fiscal year 2015, we will be reporting a non-GAAP cash flow from operations metric to show cash flow on a historically comparable basis. As we've discussed previously, most of our remaining net operating losses are considered APIC NOLs for GAAP cash flow reporting purposes and the benefit derived from APIC NOLs is treated as a financing source of cash flow.

Previously, the impact of our tax benefits flowed through the operating cash flow section of the cash flow statement. As a result, in order to provide an apples-to-apples comparison with prior-year periods, we're reporting non-GAAP cash flow from operations in addition to free cash flow, which treat all tax expense and benefits irrespective of source as part of cash flow from operations.

Having said that, in the first quarter fiscal 2015, we utilized less than $100,000 of APIC NOLs, as we continue to have sufficient deferred tax assets to offset US cash taxes. We expect to begin utilizing more material amounts of our APIC NOLs starting in the second quarter of 2015.

We continue to expect becoming a US corporate cash tax payer in fiscal 2016. A reconciliation of GAAP to non-GAAP results is provided in the tables within our press release, which is also available on our website.

Our deferred revenue balance was $256.8 million at the end of the first quarter, representing a 10.5% increase compared to the end of the year-ago period. On a sequential basis, deferred revenue decreased to $18.1 million.

As we have discussed previously, the second half of the year is a stronger period for our deferred revenue due to the same factor that drives the timing of our cash flow, namely the timing of when we bill our customers.

With the revenue model transition nearing completion, we anticipate that our deferred revenue will generally exhibit a trend pattern similar to our cash flow, driven by higher customer invoice value in the second half of the fiscal year. Accordingly, we expect deferred revenue to decline in the first half of the year before demonstrating growth during the second half.

Now I would like to close with some thoughts regarding our financial outlook for fiscal 2015 as well as guidance for the second quarter. As a reminder, fiscal 2015 represents the final year of our revenue model transition, which will conclude during the course of the year.

As we have consistently discussed, the growth rates of both GAAP revenue and deferred revenue have been higher than the real economic growth rate of our business since the model transition began in fiscal 2010. In fiscal 2015, GAAP revenue will continue to be lower than our fully transitioned revenue value, but the difference will be smaller than in prior years.

As GAAP subscription revenue normalizes, its annual growth rate should more closely approximate the growth rate of our annual spend metric. Changes in deferred revenue will continue to vary by quarter due to the timing of when we invoice our customers.

With that in mind, we expect second-quarter revenue in the range of $104 million to $106 million, non-GAAP operating income of $43 million to $45 million, and non-GAAP EPS of $0.29 to $0.31. On a GAAP basis, we expect second-quarter operating income of $39 million to $41 million and EPS of $0.26 to $0.28.

As you may recall in recent years, our second-quarter results have included cash basis software revenue from several sizable legacy contracts where payments were due near the end of the quarter. In these cases, the entire annual payment was recognized when the payment was received.

In both the second quarter of 2013 and 2014, revenue from so-called lumpy cash basis deals totaled approximately $6 million. All of these customers are now converted to aspenONE licenses with normal payment terms. As a result, we no longer expect the degree of variability in our second-quarter results that we experienced in prior years.

On a sequential basis, our revenue guidance for the second quarter is somewhat lower than our first-quarter revenue of $107.1 million. Although most of our revenue is subscription based, there can be quarter-to-quarter variability due to large license contracts recognized on a cash basis.

On a cash basis, customer pays an overdue invoice, the subscription revenue from that contract becomes less ratable, because the aggregate revenue from the due date up until the payment date is recognized immediately in a lump.

Several of our large international state-owned customers have a payment history that requires us to recognize their contract revenue on a cash basis. In the first quarter, we recognized approximately $2 million of lumpy subscription revenue that we would have recognized in prior quarters had the revenue been recognized on a pure ratable basis.

Turning to the full year, we are adjusting our revenue guidance of $432 million to $440 million from our previous guidance of $430 million to $440 million. From an expense perspective, we are adjusting our assumption for total GAAP costs and expenses to $270 million to $275 million, which compares to our previous guidance of approximately $275 million to $280 million for the full year.

Taken together, we expect GAAP operating income in the range of $159 million to $167 million, net income in the range of $102 million to $107 million, and GAAP EPS of $1.11 to $1.17. This is up from our previous guidance of GAAP operating income of $152 million to $162 million, net income of approximately $98 million to $105 million, and GAAP EPS of $1.06 to $1.13.

From a non-GAAP perspective, we now expect non-GAAP operating income in the range of $175 million to $183 million, which is up from our previous guidance of $169 million to $179 million for full-year fiscal 2015. This would lead to non-GAAP earnings per share in the range of $1.22 to $1.27, which is an increase from our initial guidance of $1.18 to $1.24 for the fiscal year.

With respect to profitability margins, we expect to sustain gross margins for the full fiscal year within our target operating model range of 87% to 90%. Our first-quarter non-GAAP operating margin benefited from lower-than-anticipated operating expense levels in the quarter and we don't expect to sustain margins at that level for the full fiscal year.

We do expect to deliver non-GAAP operating margin in excess of 40% for the full fiscal year, demonstrating strong progress toward delivering our long-term target on a sustainable basis. We continue to target a double-digit growth rate of license contract value for full-year fiscal 2015 and remain optimistic about our outlook based on continued high customer interest levels.

From a cash flow perspective, we are reiterating our fiscal 2015 guidance of approximately $215 million of free cash flow.

Even in light of the strong cash flow growth generated in the first quarter, consistent with prior years, we expect our free cash flow to be weighted to the back half of the fiscal year, with the third quarter being the largest contributor to free cash flow. This is due to the timing of when we invoice customers and their payments become due.

It's also possible that if our overdue receivables balance reverts to more normal levels, second-quarter free cash flow could be lower than the prior-year period.

To summarize, we delivered solid first-quarter results, we continue to improve our profitability and generate strong cash flow, continue to see strong usage trends for our suite of solutions, and believe we are well positioned to deliver a strong fiscal 2015 performance.

With that, we are now happy to take your questions. Operator, let's begin the Q&A.

(Operator Instructions) Sterling Auty, JPMorgan.

Wanted to hit a couple of areas. I think the most common question that I've been getting over the last month or so is the impact of global oil prices on the business.

Looking -- while you continue to do better than the double-digit on TLCV and spend, it still [beat salrey] from last quarter and people are pointing to oil prices and wondering if that is having any impact?

And at what level do you become concerned or how long do oil prices have to be depressed before you see an impact, especially in that E&C part of your business?

Okay, thank you. How are you, Sterling? Look, as I look at our business and as I mentioned in my remarks, our pipeline not only is robust, but it's growing. And supports our historical ratio, so we -- from that macro perspective, we have not seen any impact from oil prices.

As -- getting more granular, as I've traveled and met with customers, the conversation is not about $80 a barrel. It's about the software that they need to use from AspenTech to continue to optimize their operations.

And that is reflected in our pipeline. And frankly, I believe the start that we've had through the second quarter, as I have also mentioned my remarks.

And then to your -- the second part of your question regarding at what point do oil prices start making a difference, well look, and 2008, 2009, oil prices got down to $40 a barrel and that made a difference. But we continue to grow to single digits, so it depends on how low they get, but so far, we have not seen any impact.

I believe one of the issues facing our E&C customers has to do with the cost that it's taking to build some of this [out] -- and really owner-operators -- and the E&Cs are operating some of the biggest backlogs they've ever had. So business continues and we will see if oil prices continue to drop and how far they drop and then we will see if customers react.

But one thing I'll say is owner-operators have to continue to operate those assets regardless of oil prices and E&C customers have significant backlog. So we have not seen really any impact from oil price -- the oil price decline.

Okay. And then Mark, can you remind us -- I think I remember in terms of how you denominate your contracts, but what kind of FX impact did you see on revenue and expenses in the quarter?

Yes, so over 80% of our contracts are -- software contracts are in US dollars, so we would only see in FX impact in revenue in terms of the ones that were not in US dollars that became -- sort of came into deferred revenue during the period.

So I haven't calculated impact, but it's not really material to our results or we would have singled it out. And again, most of our expenses -- we do have sales offices and R&D around the world and an R&D center in China, but we haven't seen a lot of -- that's not where most of our expenses are, so there's not a lot of impact from an FX standpoint in the expense numbers, either.

All right, and the last question. When you look at the expense level in the quarter, was there either delayed hiring or other things that may have depressed expenses that maybe we get a snapback in expenses in the next couple quarters or you've been very diligent on expense management -- is this just an indication of another year where we will see that continued efficiency flow through the year?

Yes, look, I think it's a little bit of both. You've seen us adjust our guidance for expenses down. I think we're still seeing a benefit from the structural changes that we've made in different parts of the organization, from the type of individuals we are hiring.

But yes -- look, at the beginning of the fiscal year, we approved a materially significant number of headcount to hire across some sections of the organization and we are in the process of finalizing that recruitment. So those expenses haven't shown up in our P&L, but like I said, we've also adjusted our guidance for expenses down for the year. So we expect to see a benefit going forward.

Got it. Thank you, guys.

Brendan Barnicle, Pacific Crest.

Following up a bit on Sterling's question, we've seen now three quarters in a row the deceleration in the LTCV and annual spend. I know you've talked about double-digit growth, but can you give us any sense of where these bottom, if we bottom here, and what it is that creates an inflection from these levels?

Yes, so look, you talked about three quarters and maybe it's three -- I thought it was two -- but who's counting anyway? But what I like to say is look, we manage a business where we are trying to make sure that the quality of the metrics and the deals that we are doing is good, because it drives our long-term performance from a revenue standpoint -- from a margin standpoint. So we will not sacrifice on those metrics in order to drive the timing of deals.

Having said that, of course, we know we are a quarterly-driven company and we need to deliver business quarter to quarter. We've had a strong start to our second quarter now.

Like I said, if I look at my pipeline and the amount of business that is going into the pipeline, to me, that says that my long-term outlook for the business is positive and we've also -- we also deal with some customers that, depending on the business we're doing with them, those deals have to go through a rigorous procurement processes and they will take their time.

So at some point, all that business will show up and whether it's in Q2 or future quarters, we will see. But we are working to continue to be successful here and I'm positive about the outlook that we have for the business.

Antonio, specifically on Russia and Brazil, where there's been a lot of conversation about macro changes and weakness, [blink] uncertainty, whatever, have you seen any particular weakness in those markets for you?

So let's start with Russia. No. Russia continues to be a good story for us. We held a user group meeting for our technology in Russia and Moscow in early October and we have record attendance into that meeting.

We continue to see good business prospects out of Russia. Fortunately, none of the sanctions have impacted our business so far and so we continue with business as usual in Russia.

Brazil, I think now that the election is over, I think people will get back to business over there. We really haven't seen any impact of it, but we didn't have a lot of business in play over the last quarter. But knowing our pipeline, there's good prospects in Brazil and I'm sure we will capitalize on those.

Can you just remind us what they represent as a percentage of revenue?

Yes, I mean, both of those regions on a revenue basis represent less than 2%, 3% of our overall revenue. You are talking about revenues?

Right. And then Mark, just one last one for you. Bad debt expense picked up a little bit. Is anything worth commenting on there?

I actually think bad debt expense ticked down. I don't have that number right in front of me, but as I recall, it went down in the quarter.

Terrific. Thanks, guys.

Richard Davis, Canaccord.

So the one question that I get beyond angst over one or two basis point changes in the TCV growth is just the normalization of free cash flow versus non-GAAP income. And so the driver, obviously, is the deferred revenue rolloff.

So I guess Mark, the question is I know you're not guiding for 2016, but at least directionally what we're thinking is free cash flow, round numbers, the difference between free cash flow and non-GAAP income is, I don't know, about $50 million, $55 million for fiscal 2015 and $36 million or so for fiscal 2016. So you know, there's a $20 million delta.

Is that roughly the right way to think about that, because these two numbers will normalize towards each other, I would suspect, a little bit over time. I'm just trying to help people that actually think about this Company more on a longer-term basis than 90-day increments.

Yes, no, what we said -- what we've been saying for a while is clearly our cash flow has been not taxed and that's going to change sometime in 2016. And what we've been saying is when that happens, you can expect the tax rate that we report for GAAP and the cash tax rate to be relatively close, probably 35% to 36% rate, because most of our income is earned in the US.

And really, what we haven't said precisely is when in 2016 that's likely to happen. We will do that at some point, but there are a variety of factors. I think you should be assuming -- people should be assuming in their models that will happen in the first half of fiscal 2016 as opposed to the second half.

So somewhere in the first half, we will run out of all of our benefits and then we will immediately -- it won't be a slope, it will just immediately go up a cliff, if you want to think of it that way, to 35% and 36%.

So for modeling purposes, you should think about taxing our pre-tax income at that rate and taking that off of cash flow, because that's what will -- that will sort of be the transition that happens sometime in 2016.

Sounds like a good reason to look for real estate in Bermuda. You can get a tax inversion going here.

Yes, we considered that, but it creates different issues. In terms of cash and whatnot.

Exactly. Okay, cool, thanks a lot.

(Operator Instructions) Mark Schappel, Benchmark.

Hi, good evening. Thanks for taking my call. Most my questions have been asked, but one for you, Tonio. In the past, you've talked about whitespace with respect to the number of modules customer using and -- or in terms of penetration in the install base.

And with respect to that whitespace, I was wondering if you could just give us an example or two of how you are trying to tackle those areas in your customer base.

Well, look, as I've said, we were fortunate in that we have a business where 350 -- our top 350 customers represent (technical difficulty) of our business, so we were able to drive a level of granularity in understanding the business that probably most other companies cannot.

So we have a detailed whitespace analysis for those customers. That whitespace analysis is a starting point for our yearly planning process in the sales organization, where we have a medium-term forecast for our sales projections based on the whitespace and based on pipeline and then what we think we can do over that medium term.

That then in turn shows up in account plans and how -- and how our sales account managers plan to execute in their accounts to convert whitespace into business. So -- and as time progresses, we get better and better with that whitespace and the fidelity that we are able to drive to pinpoint opportunities in our customer base.

And that number of $10.1 billion of TLCV, of total adjustable market, is the outcome of that and we will continue to refine it and update it as time goes on. But it's part of our yearly planning process, looking at that whitespace. I hope I answered your question with that.

Great. Thank you.

I would like to turn the call back over to Mr. Sullivan for any closing remarks.

All right, this is Antonio. Well, I want to thank everyone for joining us today and look forward to talking to you or seeing you over the next days and weeks. Thank you, all.

Again, thank you for your participation. This concludes today's call. You may now disconnect.