Barings BDC Inc (BBDC) 2010 Q4 法說會逐字稿

At this time I would like to welcome everyone to the Triangle Capital Corporation's conference call for the quarter and year-ended December 31, 2010.

(Operator Instructions) A question-and-answer session will follow the Company's formal remarks. Today's call is being recorded and a replay will be available approximately two hours after the conclusion of the call on the Company's website at www.tcap.com under the Investor Relations section.

The host for today's call are Triangle Capital Corporation's President and Chief Executive Officer, Garland Tucker; Chief Financial Officer, Steven Lilly; and Chief Investment Officer, Brent Burgess. I would now like to turn the call over to Mr. Tucker.

Good morning, everyone, and thank you for joining us for our fourth quarter and year-end 2010 earnings call. Before we begin I would like to ask Steven Lilly to provide the necessary safe harbor disclosures. Steven?

Thanks, Garland, and good morning, everyone.

Triangle Capital Corporation as many as you know issued a press release yesterday afternoon with details of the Company's quarterly and annual financial and operating results. A copy of the press release is available on our website. Everyone should note that this call will contain forward-looking statements other than historical information including statements regarding our goals, the lease, strategies, future operating results and cash flows. Although our management team believes these statements are reasonable, actual results could differ materially from those projected in forward-looking statements.

These statements are based on various underlying assumptions and are subject to numerous uncertainties and risks including those disclosed under the sections titled risk factors and forward-looking statements in our annual report on Form 10-K for the fiscal year-ended December 31, 2010 as filed with the SEC yesterday. Triangle Capital undertakes no obligation to update or revise and of these forward-looking statements.

And with that I will turn the call back over to Garland for some introductory comments.

Okay. Thanks, Steven.Again, I would like to welcome all of you to today's call. In keeping with the format of our prior calls I will briefly discuss some of the highlights of the quarter and the full-year and then Steven and Grant will provide more detailed information about our operational and financial results as well as certain trends we're seeing in the investing market. I would like to start by saying that we are extremely pleased with the operational and the financial results our team generated during 2010.

We initiated over $140 million of investments and 16 new portfolio companies across 12 different industries during the year. These investments provide further diversification of our investment portfolio which as of December 31, 2010 included 48 portfolio companies across 24 different industries. It's interesting to note that our 2010 investment activity in new portfolio companies was approximately $100 million higher than it was during the year 2009. Based on our belief that we are now operating and investing in a very advantageous time in the economic cycle, we are optimistic that the additions we made to our investment portfolio during 2010 will create long-term value for Triangle shareholders.

As Steven will discuss in greater detail in just a minute, due to our increased investment activity during 2010, our total revenue and total NII, both increased materially during this year. We also increased our quarterly dividend to $0.42 a share during the fourth quarter of 2010. And for the full-year we provided shareholders dividends and distributions of $1.65 per share. Finally, in December of 2010, we successfully transferred the listing of our common stock from the NASDAQ exchange onto the New York Stock Exchange and we are continuing to enjoy the increased visibility associated with that move.

With that, I would like to turn the call back over to Steven for some more detailed comments about our financial results, our recent capital markets activities and our liquidity position. Steven?

Thanks, Garland. Again, as I said earlier we issued our earnings release filed our 10-K yesterday afternoon after the market closed. I will focus first in this section of the call on our results for the fourth quarter, then followed by some comments relating to our results for the full-year, and then a few comments regarding our capital markets activities and liquidity position. First for the fourth quarter of 2010, during the fourth quarter we generated total investment income of $10.4 million representing a 37% increase over the fourth quarter of 2009. This increase was primarily driven by loan interest income from new investments as well as dividend and fee income from various portfolio companies.

Operating expenses during the fourth quarter of 2010 totaled $4.2 million as compared to $3.5 million during the fourth quarter of 2009. The $700,000 year-over-year increase in operating expenses was primarily related to an increase in SBA interest expense and fees totaling approximately $181,000 and a $513,000 increase in SG&A expenses which primarily related to the expansion of our investment team during the year with the additional four new professionals and the non-cash impact associated with granting of certain shares of restricted stock in February of the year. Net investment income for the fourth quarter was $6.2 million as compared to $4.0 million during the fourth quarter of 2009 representing an increase of 53%.

Our NII per share during the fourth quarter 2010 was $0.42 as compared to $0.39 during fourth quarter 2009. Given that we completed a $41.5 million follow-on equity offering in September 2010, we feel especially fortunate that our NII during the fourth quarter of 2010 was at a level that permitted us to increase our quarterly dividend per share from $0.41 to $0.42. Our net increase in net assets resulting from operations during the fourth quarter of 2010 totaled $7.2 million as compared to $8.3 million in the fourth quarter of 2009. The primary difference between our net investment income and our net increase in net assets resulting from operations during the fourth quarter of 2010 was a total net gain on our investment portfolio of $1.2 million, as compared to a total net gain on our investment portfolio of $4.3 million during fourth quarter of 2009. On a per share basis our net increase in net assets resulting from operations in the fourth quarter of 2010 was $0.48 compared to $0.80 during the fourth quarter of 2009.

For the full year-ended December 31, 2010, we generated total investment income of $36 million representing approximately a 30% increase over 2009. This increase was primarily driven by loan interest income from new investments as well as dividend and fee income from various portfolio companies.Operating expenses during 2010 totaled $15.8 million as compared to $13.7 million during 2009. The $2.1 million increase in operating expenses was primarily related, as I mentioned earlier, to the expansion of our investment team as well as additional non-cash compensation and SBA interest-related expenses. Net investment income for the year-ended December 31, 2010 was $20.1 million as compared to $14.0 million during 2009, representing an increase of just over 43%. Our NII per share during 2010 was $1.58.

Our net increase in net assets resulting from operations during 2010 totaled $25.4 million as compared to a $4 million net increase in net assets resulting from operations in 2009. The increase in our results was primarily due to net gains in our investment portfolio in the amount of $5.5 million during 2010 as compared to net depreciation in the portfolio during 2009 of approximately $9.9 million. On a per share basis our debt increase in net assets resulting from operations during 2010 was $1.99 as compared to $0.47 during 2009.

Turning to our net asset value. Our net asset value on a per share basis at December 31, 2010 was $12.09 as compared to $11.03 at December 31, 2009, which equates to an increase of $1.06 per share during the year. From a credit quality perspective, we did not place any additional investments on nonaccrual during the fourth quarter. And based on our previously announced in the third quarter 10-Q debt-to-equity conversion at Waste Recycler Holdings, LLC, our nonaccrual assets at December 31, 2010 totaled 5.4% on a cost basis as compared to 11.5% on a cost basis as of September 30, 2010, and 8% on a cost basis at December 31, 2009. On a fair value basis our non-accruals at December 31, 2010 were at 3%.

From a capital markets perspective, we've continued to be active since our earnings call in November of last year. As Garland mentioned earlier, during the fourth quarter we invested a meaningful amount of the proceeds from our September equity offering. As a result during February of this year, we accessed the equity markets again raising approximately $63 million of additional capital. The purpose of this offering was to continue equitizing our Holding Company, or TCC as we call it, so we can begin making portfolio investments at that level of our Company.

As a result, we now have three distinct legal entities out of which we can make portfolio investments; a Holding Company, and our two SBIC subsidiaries. This structure provides us with significant flexibility both within the SBA program and beyond as we analyze various investment opportunities in our target market. In addition, on March 1, 2011, we voluntarily prepaid $9.5 million of SBA debentures. This is the second time we voluntarily prepaid SBA debentures, the first being in September of last year. The interest rate associated with these debentures was $5.80, and they matured on September 1, 2015. While this semi-annual SBA interest rate pooling that occurs later this month and therefore we are not able to quantify the annual interest rate savings yet, at this point we are expecting it will be favorable to our shareholders especially when coupled with the 5.5 year extension of the maturity date from September 2015 until March 2021.

This SBA repayment results in Triangle having no debt maturities until March 2017, and only $10.4 million of debt maturities before September 2018. In a continuation of the thought process we outlined in our third quarter call last year, we will continue to analyze and weigh the benefits to our shareholders of continuing to voluntarily prepaid SBA debentures in the future. Finally from a liquidity standpoint at December 31, 2010, we had $54.8 million in cash on hand and approximately $21.6 million in SBA debentures available, equating to total liquidity at December 31 of $76.4 million. After giving effect through our February 2011 follow-on equity offering and investments which have closed since December 31, we have total liquidity of approximately $116 million, of which almost $100 million is cash on hand and the balance is SBA debentures. As a result, we believe we are well positioned to continue looking for high-quality investment opportunities in the lower middle market.

And with that natural segway, I will turn the call over to Brent for some comments on our investment portfolio and some general comments on the overall mezzanine market. Brent?

Thanks, Steven. Of the $173 million of investments that we made in 2010, just under $163 million was in the form of debt. And just under $11 million was in the form of equity. We added 16 new companies to our portfolio during the year and made follow-on debt investments in 10 existing portfolio companies. We also made 5 follow-on equity investments in existing portfolio companies. Our 16 new investments during 2010 averaged approximately $8.8 million, which represents a modest increase in our average investment size since our IPO.

However, if you analyze the 9 transactions we've closed since September 30 of last year, you will notice that our average investment size was approximately $10 million. While some of this variance in investment size is due to normal market fluctuations, it's also true that Triangle is becoming a more relevant player in the lower middle market and we are able to pursue and lead certain transactions that we would not have been able to lead a few years ago.

However, it is also important for me to point out that diversification both in investment size and also across various industries remains a primary tenet of our investment process. During the year we received full loan repayments from 9 portfolio companies totaling $43 million and normal principal prepayments, partial loan repayments, and PIK interest repayments totaling approximately $8 million. In some cases we received prepayment penalties when loans are prepaid. During 2010, these prepayment fees along with the acceleration of deferred origination fees generated a little more than $1 million of revenue for us.

During the year we also exited three equity investments for realized gains of approximately $4.1 million and we converted two nonaccrual debt investments to equity resulting in realized losses of approximately $10.4 million. As Steven mentioned, we did not place any new investments on nonaccrual status during the quarter. We continue to work diligently with the companies that do remain on nonaccrual status to restructure those investments to achieve the most advantageous outcomes. And we are pleased that our nonaccrual assets at 5.4% of the portfolio on a cost basis and 3% of the portfolio on a fair value basis, are very manageable. From a general market perspective, we continue to see traditional senior lenders willing to lend deeper into the capital structure. This activity has resulted in a marginal increase in total leverage levels, but has not yet resulted in increasing of the purchasing multiples that financial sponsors are paying for businesses.

As a result, what we are currently seeing is a continuation of the trend wherein transactions are returning to a more normalized capital structures in terms of the mix between senior debt, sub debt and equity. From the period over the last two years or so when capital structures were over equitized and leverage was lower. In terms of specific transaction structures we are seeing you will notice that we have equity upside in seven of the nine investments we have made since September 2010, which is very much in line with our historical range. One specific comment relating to our investment activity in the fourth quarter of last year. The fourth quarter was extremely busy as companies and individuals sought to close transactions within the year due to the significant uncertainty regarding tax legislation. As a result you should not expect that our 2011 quarterly investment pace will mirror our 2010 fourth quarter pace.

Finally, as I think you all know it's Triangle's policy not to discuss the specifics of our investment pipeline. But at risk of incurring the wrath of my colleagues at Triangle, I will say that we remain very pleased with the pipeline. We are on the road a lot. We are pleasantly surprised that things have not slowed down as much as we had expected coming off of Q4. And, from where I sit, I think we will remain busy for the foreseeable future as we continue to believe that we are investing during a favorable time in the economic cycle. Albeit, with some degree still of caution that we feel about the macro economic conditions.

With that I will turn the call back to Garland for any concluding comments before we take questions.

Okay. Thank you, Brent. As I hope all of you can tell from our comments, 2010 was a very exciting year of transition for Triangle. We started the year with 36 portfolio companies, 13 employees, a single SBIC subsidiary, with $150 million of committed capital, am equity market capitalization of $140 million, and we were paying an annualized dividend of $1.64 per share. One year later we now have 50 portfolio companies, 17 employees, two SBIC subsidiaries with $225 million of committed capital, an equity market capitalization $355 million and we are paying an annualized dividend of $1.68 per share. As we look forward to the balance of 2011 and beyond, we hope that one year from now we will be again in a position to outline and discuss equally great accomplishments while maintaining an equally aligned focus of continuing to earn our dividend and provide long-term value to our shareholders.

And with that, operator, I would like to turn it over to you. We are ready to open the call for questions.

Thank you. (Operator Instructions)

Our first question is with from John Hecht with JMP Securities. Your question please.

Good morning, guys. Thanks for taking my questions and congratulations on a successful year. First question, I know you don't like to discuss specifics with respect to the pipeline. But maybe can you give us a sense at least for coming to the latter part of last year, what were the sources of the transactions? Are these M&A opportunities in the middle markets or is there expansion related capital? And what were you seeing with respect to trends in terms of maybe spreads and terms coming out of the year?

Hi, John, it's Steven. Thank you for your two part question. I will make just a brief comment and then turn it over to Brent maybe for some details around it.I think in general, for the transactions we closed in the fourth quarter many of those the work started back in the summer and late summer timeframe and tended to come from our traditional sources, private equity sponsors, for the vast majority of those. But in terms of some detail of that and some of the structure let me turn it over to Brent for a couple of comments.

Yes. Thanks, Steven. John, we completed seven new transactions in Q4. Of those, two were recaps and five were buyout's. They were all with sponsors and all but one case with traditional funded sponsors. And in terms of the basic terms of leverage and pricing, I think as we've talked about on previous calls, the pendulum is certainly beginning to swing back away from the really conservative extremes that we saw in 2009 when you were able to get very, very attractive pricing at very low leverage, if you could get anything done in 2009. So, we see a continuation of that trend where leverage multiples are gradually creeping up and pricing is being slightly under pressure.

I would say we haven't seen any extreme changes or movements in that and we remain very pleased with the pricing as well as the leverage that we were able to achieve in the deals we closed. As you may have seen from our K, we ticked up from I believe 14.7% to 15.1% our weighted average yield on our investments. So, we are pleased with what we were able to accomplish in the market still.

Okay, great. Thanks for that color. Second question is you had a good movement in your credit metrics as a result of the resolution of one of your NTA's from the quarter. But what can you talk to with respect to credit trends? What are you seeing in terms of revenues and EBITDA in the portfolio companies coming out of last year?

Some of our peers are reporting very strong, at least in a couple of cases that I have seen, very strong EBITDA growth in their portfolio. We have seen, I would say, mid- to high single digit EBITDA growth in general across the portfolio. A little bit less in terms of revenue growth. There's certainly been some margin expansion as companies have worked very hard in 2009 to bring their costs down and we are beginning to see the benefits of that.

I would say, recently we're seeing some very encouraging trends of an acceleration of pickup across a fairly broad range of companies. It's very early to call that a trend and as I mentioned in my earlier comments, I personally, and I think we collectively, remain fairly cautious about the overall macro environment. There are a fair amount of headwinds. At the same time, there is obviously a lot of fiscal and monetary stimulus out there. And so, there's some conflicting forces but we are seeing some positive trends overall within the portfolio.

Great. Last question. A little bit of a technical one and I'm not sure if you can answer it yet given tax (inaudible).It looks like you had a little bit of a - - penny or two of spillover from last year on the dividend, are those calculations correct?

Yes, John, those are - - there is a bit of that as which as you know it's always tough to hit perfectly the dividend as it relates to our ICTI, or our taxable income. So, yes, there is a little bit of that. But depending on how precise you want to get in your modeling we can certainly follow up off-line about it.

Okay, great. Thanks very much guys.

Thanks so much.

Thank you, Our next question is from Robert Dodd with Morgan Keegan. Your question please.

Hi, guys. Hopefully you can hear me okay. Congratulations on the quarter and the year. On the pipeline angle, from a different angle if I can, when we look at Q4, can you tease apart the sleds of how much of Q4, or the acceleration in capital deployed through the year, was a function of market demand versus your increased investment capacity with your extra headcount?

Robert, this is Steven, it's sort of like untying the Gordian knot. If we answer that one way then it says our guys are just so great and everybody wants to do business with them. If you answer it the other way then it says we just took whatever happened to come in over the transom. So, I think the reality is it's a combination of both. We could not be more pleased with the additions we've made to our team during the year and folks are just working out great.

So there certainly is an expansion of the team but I think you have heard it from other people too, there really were some macro drivers of demand last year. Again, back in the summer months people were very, very focused earlier than usual to try to get transactions done ahead of what it - - it's difficult to remember back to that time now, but was just an incredible amount of uncertainty relating to the tax situation, much more than any typical year. So, I think it was a bit of a one time rabbit-going-through-the-snake, if you will. And it's certainly pulled a little bit of demand out of the first quarter.

That being said, we're very pleased we've already closed two investments in the first quarter. But I think it's tough for us to get any more precise than that, but before we leave the subject, Brent or Garland, if you have any thoughts? Garland, I will let you start and then maybe Brent if you have any thoughts?

Yes, I would say, it is very hard - - it is very hard, obviously, to sort through all the factors. I would say that there was nothing totally unique about either the fourth quarter or the first quarter of last year. I mean there were definitely very different factors at play. And the amount of investing we did in the first quarter was very different from what we did in the fourth quarter. But if I were going to predict, I would say there will certainly be times in the future when we will be, I hope there will be times when we will be as busy as we were in the fourth quarter and there will probably be times it will be equally as hard to get deals done as it was in the first quarter of last year.

Robert, I will add, and I think this is important to add, because this is maybe a bit of a differentiator in how we operate. We don't tend to hire in advance of demand. We tend to hire in response to demand. So, the need internally has to be fairly well established before we take the step to bring on additional people.

Okay. Got it. Thank you. On - - just - - you're talking about a little bit of the market using in terms of pricing etc. Are you seeing any early indications from your portfolio companies where you've got really good terms a couple years ago, that those guys might be looking to refinance and either take you out or redo the terms of some deals given a more favorable pricing environment that we are looking at going forward?

Robert, it's Steven, let me just give a quick thought and again I will turn it over to Brent just to be sure you get the precise thought as well. But from a high-level perspective, prepayments or repayments are incredibly difficult for us to predict, if not impossible. In the third quarter of last year, you may recall, we were basically net neutral in terms of the new investments that we made were offset completely by repayments in the portfolio. Then in the fourth quarter, we had basically no real repayments in the portfolio. So, it's really difficult to predict quarter-to-quarter but I think there always will be some as you are in a strengthening credit environment as we are. But, again, Brent do you have any additional thoughts maybe to provide with Robert?

Yes. I mean I think Robert that your question is a good one. I think without being able to predict any of the specifics whatsoever, I think you can predict that in general, that we will experience, setting aside the fact that we have a larger portfolio today than we did a year ago, we will experience most likely a higher ratio of repayments this year than last year, as long as market trends continue.

I think that's very likely and when obviously exits are driven by two things, they are driven by the sales of businesses which is typically good for our equity investments in those businesses, or they are driven by recaps. And obviously, that's the same type of activity that drives our new origination business. So to the extent that we are sort of in the middle of the market we are getting it on both sides. But there certainly are situations where we look at does it make sense, is this a good credit? Does it make sense for us to adjust our terms in order to remain in the credit? We don't have many of those discussions ongoing now, but I would say there is usually some level of that type of discussion going on in the portfolio.

Great. Thank you. Last question if I can?Obviously, you've got a tremendous liquidity position, etcetera, with a lot of cash. Any color or update you can give us on non-SBA debt financing at the parent? Any rough idea of timing? Are you looking floating? Are you looking to do a term facility? I mean is there any color you can give us or is that a no comment?

No, but thanks, Robert, for asking. We are actually in process with our first debt facility at the parent and we would hope that we'd have something closed call it in the first half of this year. I think what makes the most sense for us and what you probably will see, again, before the end of June, would be a kind of think traditional bank facility that would give us the ability to draw down on a revolver and then pay that back as we issue permanent capital in our, again, those small bites that we have taken historically inventory of capital along the way to keep our investment guys focused but not having too much capital either so we feel pressured to put money to work.

That really works, that type of structure I think would work well for us, for where we are now. Obviously, some BBC says issued convertible debt and that's something that is a nice appropriate product or type of capital offering that is something we would consider at the appropriate time. I think the most meaningful step we needed to take was to continue to equitize the holding company, which we began doing back in September of last year really with the offering that we did just last month, provides us with great liquidity at the parent level. So, I feel like were exactly where we hope to be right now, but we will be putting something in place at the parent in the first half of this year.

Thanks, guys. And again, congratulations.

Thank you, Robert.

Thank you. Our next question is from Charles Redding with BB&T Capital Markets. Your question please.

Hi, guys. Good morning. Thanks for taking my call. Just a quick, a couple quick follow-up questions. In terms of realized losses for the quarter, are those exclusively due to the waste recyclers restructure? There were no additional components in that, correct?

That's correct. And again, Charles, we'd announced that. We had put it in the third quarter queue as a subsequent event.So that was certainly no surprise and it also did not have an impact on NAD because we already written that investment down.

Great. And then in terms of appreciation for the quarter, the roughly $8 million, $8.5 million. Is that, is there a reversal component in that, or was that exclusive for the portfolio?

Yes, the way to think about that, Charles, yes, the short answer to your question is there definitely was the reversal. That accounting, I'm glad you asked, it does tend to get people a little tied up sometimes. But if you think of the portfolio on a sequential basis, kind of marching from the third quarter of last year to the fourth quarter of last year, then the portfolio the total net write off in the portfolio was about $1.6 million across the entire portfolio. So I think that goes back a little bit kind of to some comments we made a minute or two ago that we've seen performance and metrics at our portfolio companies improving a bit and that is beginning to flow through to some of the equity values.So there was a small move in the right direction to the portfolio but you are correct, it's tough sometimes in the way the public financials have to be presented to follow that so thank you for asking.

Sure, sure.In terms of the specific reversal amount, can you give that? Or is that usually the difference between $8.5 million and the $1.6 million?

It was between $7 million and $7.5 million.

Okay. Great, that's helpful. And then last question. If you've got pretty good cash on the books now is it a safe assumption that you will continue to look at additional recaps here in March with the window opening up of the SBA debt?

Well as I mentioned a few minutes ago, we did prepay voluntarily, $9.5 million of SBA debentures which was the next trance of debentures that were maturing for us. And we will lock in to a long-term rate later this month on what was borrowed between September of last year and March of this year. The SBA, there may be some confusion in the market out there, but SBA permits its' companies to, or its' funds, to prepay on two days of the year. One is March 1, and the other is September 1. So those are the only times you can prepay the SBA.

So you need to have a bit of luck and wind at you're back to have cash on hand at the appropriate time to do that. We have been fortunate, I would say, that in September of last year when we did the $22.5 million or $23 million of prepayments, that we had that cash. And then again in March of this year we had a little bit of cash. So, it has been a good thing for us and we will continue to look at that as September rolls around this year to see if it's worth doing a little more. But you have to line up your maturities as well as cost of the debt and it's got to be a win, win for shareholders, and both of ours has been, thankfully.

Great. Thanks a lot, Steve.

Thank you. Our next question is from Dan Nicholas with Robert W. Baird. Your question please.

Thanks. Good morning, guys. Just one question, last quarter you all touched on I guess the fact that there was some competition coming up into the space from banks to some extent and from other specialty lenders. Just trying to get a sense for how that is playing out now and if that has changed at all at this point?

Thanks, Dan, this is Steven. I will give, again, just a brief comment and let Brent and Garland make any comments that they would like to make too because we may all have slightly different views on that. But I think in general, banks have been, we see that the C&I space, or the commercial and industrial space, is perceived to be the safe haven for banks who are still working through a lot of real estate issues. And this is the fertile area for growth.

So they are increasingly chasing traditional operating companies in a meaningful way, leverage levels that are acceptable to banks have been going up and I think that really helps frame some of Brent's comments earlier in the call to say we are seeing capital structures return to more of a normal basis in terms of a mix between senior debt, mezzanine debt and equity from 18 months ago or even 12 months ago where they were a little more over equitized, if you will, or had more junior capital in the capital structures. So that's just high level, but Brent and Garland, Brent, I will turn to you first.

Yes. That is a continuing trend. I think there were a few people on the last call that were maybe a little surprised by that comment. I suspect that would not be the case today. Clearly, there are more banks and more specialty lenders out there focused on the senior cash flow market in the lower middle market where we play. And we see that as a very good thing for us. I would still say that the number of lenders participating in that market is not particularly large and there are still many, many banks that are in the penalty box and really have very little liquidity with which to invest. But I would say we're seeing encouraging trends in bank lending.

Okay. That is helpful. I think the rest of my questions have been answered. Thanks, guys.

All right. Thanks, Dan.

Operator, are there other questions?

Thank you. I'm showing no further questions at this time so I would now like to turn it back over to Mr. Lilly for any further remarks.

Okay. Well thank you all very much. And look forward to talking to you next quarter. Take care.

Ladies and gentlemen, thank you for your questions. We appreciate you're participation in today's presentation. The presentation has ended and you may disconnect at this time. Have a wonderful day.