CEVA Inc (CEVA) 2005 Q2 法說會逐字稿

Welcome to the Ceva second quarter 2005 earnings conference call. [OPERATOR INSTRUCTIONS] It is now my pleasure to turn the floor over to Mr. Yaniv Arieli, CFO of Ceva.

Thank you. Good morning everyone, and welcome to the Ceva 2005 second quarter conference call. This conference call will be conducted by Gideon Wertheizer, our Chief Executive Officer, who will cover business aspects; myself, Yaniv Arieli, Chief Financial Officer, who will cover the forward-looking statements, the financial results for the second quarter, and financial guidance for Q3 ’05 and annual 2005.

Today’s conference call contains forward-looking statements that involve risks and uncertainties, as well as assumptions that if ever materialize, or prove incorrect, would cause the results of Ceva to differ materially from those expressed or implied by such forward-looking statements and assumptions. All statements, other than statements of historical fact, are statements that could be deemed forward-looking statements. The forward-looking statements in this conference call include statements concerning expected growth in sales from a number of technologies, including some recently introduced and expected to be introduced in the future. Ceva’s guidance with respect to its revenue, gross margin, total operating expenses and other income, and number of shares outstanding for the third quarter of ’05 and for full year 2005.

The risks and uncertainties assumptions referred to above include intensive competition within our industry, the industries in which we license our technologies, and experience a challenging period of growth that the market for the sales of our technology may not develop as expected, especially in the case of new introduced or planned to be introduced technologies, our ability to timely and successfully introduce new technologies, that we rely on revenue drivers from a limited number of licensees, and other risks remaining to our business that are described from time to time in the company’s Securities and Exchange Commission report, including, but not limited to, the annual report on Form 10-K for the fiscal year ended December 31, 2004, and reports filed after Form 10-K as well.

Ceva assumes no obligation to update any forward-looking statements or information which they or their representatives make. With that, I would like to turn the call now to Gideon Wertheizer, CEO of Ceva. Gideon, please.

Thanks Yaniv. Good morning, and thanks for joining us today. I hope you had a chance to read our press release with the results of second quarter 2005. I would like to share with you the objective that I see for Ceva going forward. The objectives are to operatively change the organization to focus on growth drivers and its deployment in the market, establish a profitable organization with a healthy operating margin. We set a target to reach a 10% operating margin in the first half of 2005.

As to the focus on growth drivers, I believe that Ceva is well positioned to leverage opportunities in the very large and growing DSP market. Our product line is divided into two categories, the first category in our product portfolio is the DSP core. The DSP core is a programmable processor that is primarily designed for efficient processing of digital signals. Digital signal processing is critical technology in many applications and markets such as communications, consumer, automotive, and computer peripherals. Our latest DSP cores, the Ceva X and TeakLite-II, has attractive price and performance metrics to be deployed in growing markets such as 3G cellular, DTV, IPTV, voice over IP, audio players, disk drives and more.

The second category of our product portfolio is application specific platforms. This is a relatively new product line with the objective to provide a value added offering in terms of one stop shop for hardware and software integration. As opposed to our DSP core, which is a generic technology, our application specific platforms are aimed to provide a full solution for a defined market where we identify market needs.

Currently we offer platforms for three markets, the first platform is multimedia for [inaudible]. It is the largest market in terms of IC shipment with 600 million multimedia enabled ports to be shipped in 2005. our multimedia offering makes use of our patented media technology, the [inaudible], which significantly reduces the computation power required for advanced media codex, such as H264 or [inaudible]. As a result, we offer video solutions in software rather than hard wire design, as commonly used. Software based solutions are preferred by customers due to their flexibility, time to market and reduced [inaudible].

The second platform is GPS for cellular. Location based services via GPS is valued by cellular operators, as it drives higher ALPU. The latest report focused 160m GPS enabled phones to be shipped in 2008. Ceva is offering a complete solution composed of our DPS core and software, along with professional services for [inaudible] these very complex technologies.

The third platform is storage for consumer electronics and servers. Our offering is for the emerging serial ATA, SATA, and serial [inaudible] SAS standard. Here we leverage on our core technology and competency in mixed signal design to provide our customers with highly integrated platforms and associated design services.

As to the focus on profitability, we believe that it is possible to reach sustainable profitability and the full intent to pursue a strategy that allows the company to reach this goal in the context of our existing revenue stream. Our current operating margins must be improved. We are cutting costs, mainly in the G&A area, and are creating a more efficient organization. We have identified an operating expense cost saving of approximately $2m for 2005, compared to the company’s previous 2005 operating expense guidance of $36m - $37m.

Our new Q3/Q4 guidance operating expense level we’ve included these cost savings. We believe that these measures, along with growth in new platform business, will get us to our 10% operating margin target in the first half of 2006.

Now to the financials. Our revenue for second quarter was $9.5m, 5% below our low end of guidance, 5% below first quarter ’05, and 1% below the same quarter last year. During the quarter we signed five new licensing agreements, of which three are multimedia platforms in software, one for SATA, and one a prepaid royalty for DSP core. There was no GPS license agreement that was signed in Q2. The customer’s target applications are Smartphones, consumer multimedia and networking.

The prepaid release agreement is with one of our key customers that is already shipping millions of units, and it has a very good visibility for future shipments of product enabled by our DSP core. However, Q2 continues price erosion in the chip business, and in light of the fact that the per unit royalty payment to us is fixed, we agreed to provide a [inaudible] on a per unit royalty in exchange for advanced payment. We would like to emphasize that this prepaid arrangement is for a predefined quantity, and either a new prepaid arrangement or resuming of the royalty per shipped product is expected once the predefined quantity is consumed.

In a few moments, Yaniv Arieli, our CFO, will go through the financials in more detail, as well as the restructuring charges we identified in our plan for higher profitability.

During the second quarter we announced a new platform solution, the Ceva-Audio, a complete hardware and software solution for digital audio. The platform is targeted for the growing demand in usage of cell phones as audio players, and the commoditization in the MP3 player market where integration and small [inaudible] size are required to meet market demand. Our one stop shop strategy is clearly the customer preference over alternative of [inaudible].

As part of our focused strategy we also decided to cease new development in our old Bluetooth product offering. Bluetooth has recently become a commodity with no growth opportunities, mainly due to immigration to a more powerful standard such as WiFi and Ultra WideBand. Ceva will continue to support its existing Bluetooth customers throughout their deployment process.

As for Q3 and 2005 yearly guidance, in the last few weeks we conducted an in depth analysis of the pipeline, discussed with our key customers their plans, and also reviewed objective market data. As a result, I would like to highlight a few key points that we took into consideration in setting our guidance.

GPS, it appears that operators are currently focused on 3G deployment. It will then pave the way to GPS services. As a result, semiconductor companies in OEM/ODMs, are delaying the season for GPS induction, waiting for better visibility. Third generation cellular; 3G deployment is progressing fast, driving semiconductor companies to come out with chips. However, it appears the customers tend to add 3G hardwired, dedicated chips, instead of integration onto a single chip. This will be addressed in the next design cycle, to achieve cost and power optimization. We are getting strong indications that our latest DSP core, Ceva X, has the right performance for the coming new designs. I would like also to emphasize that two of our customers are already using Ceva X for new 3G design, those are considered leaders in the market.

Multimedia [inaudible] video platform is targeted for the multimedia services enabled by the 3G network, specifically mobile TV, EGDVBH, DMB, high quality digital images, high resolution video, and video recording. We see a strong interest for this product in Japan and Korea. We are optimistic that demands from Europe and the US will follow in 2006.

Taking all this into consideration, we decided to be cautious in the coming two quarters. The guidance for Q3 revenues should be in the range of $8m – $9m, and the guidance for full year should be in the range of $36.5m - $38.5m. I will now turn to Yaniv Arieli to review the Q2 financials and future guidance.

Thank you, Gideon. I’ll now review the results of operations for the second quarter of 2005 from top to bottom. Revenue for the second quarter was $9.5m. revenue breakdown was as follows; licensing revenue was $6.6m, reflecting 69% of total revenue. Royalty revenue was $1.6m, reflecting 17% of total revenue. Service revenues were $1.3m, reflecting 14% of total revenue. Our gross margins for the quarter were 88%.

Research and development costs were $5.5m for the quarter. operating expenses for the second quarter of 2005 include the reorganization and severance charge of $1.7m associated with the previously announced plan to reduce the company’s operating expenses, primarily those relating to general and administrative functions, and one time impairment charge of $.5m arising from the reevaluation of the remaining intangibles from the Bluetooth technology product line, which we exited during this quarter of $400,000, and an impairment of other redundant assets in the amount of $100,000.

Total operating expenses for the quarter were $11.1m. operating expenses for the quarter include two restructuring related charges that would have been $8.9m. other income, net, for the quarter, was $443,000. net loss for the quarter was $2.2m, or $49,000 after excluding the two restructuring related charges.

Moving on to other related data; shipped units by Ceva licensees were approximately $27m for the second quarter of 2005, compared to $30m shipped in the previous quarter. Our quarter-two royalty revenues reflect customers’ reported unit shipments from the first quarter of 2005 and our first quarter 2005 royalty revenue reflects customers’ reported units shipped from Q4 from last year, which was a seasonally stronger shipment quarter for our customers. The 8% sequential drop in royalty revenues in the second quarter of 2005 over the first quarter of 2005 is explained by the seasonality.

Second quarter ‘05 royalty revenue is up 30% over the same quarter a year ago, and the unit shipment number is up 14% from 23.7m units shipped in the second quarter of 2004, overall reflecting the continuing growing market adoption of CEVA technology and customer success, using our technology. In Q2 of this year, we had a total of 22 shipping customers, 15 pending [ph] per unit and seven in the prepaid units.

Operating expenses, excluding the two restructuring charges for the second quarter were $8.9m, which is a 7% increase compared to the first quarter of 2005, primarily reflecting lower grants received from Irish and Israeli government agencies for research and development costs, higher contractual and [inaudible] headcount movements throughout the quarter. We will continue to actively monitor operating and other costs in line with our strategy that Gideon mentioned just a few minutes ago.

Other income increased over 32% to $443,000, reflecting mainly the higher yields achieved on our cash balances, compared to the first quarter of 2005.

As for the balance sheet items, at the end of June, 2005, cash and marketable securities were $59.7m, down $700,000 from the prior quarter. This was mainly a result of the $300,000 of payments arising from our recent restructuring charges. The other principle drivers in the movement of our quarterly cash balances was cash generated from operations, including the restructuring payments referred to above of $300,000, offset by around $400,000 used in the purchase of property and equipment.

If you exclude the $300,000 of payments arising from the restructuring, our cash from operating activities would have been positive by $100,000 for the second quarter of 2005. We continue to monitor DSOs, which have slightly increased from 82 days in the first quarter, to 89 days in the second quarter.

Now for our guidance going forward. Looking ahead, we expect total revenues for the third quarter to be between $8m to $9m. Gross margins are expected to stay at the same level of the 87% to 89% range, with operating expenses to be in the range of $7.9m to $8.6m. Interest income, net, is planned to be approximately $350,000.

For the full year of 2005, revenue guidance is in the range of $36.5m to $38.5m; gross margins in the range of 87% to 89%, and operating expenses, after taking into account the cost savings within the third and fourth quarters, will be in the range of $33.5m to $34.5m. Interest income, net, is planned to be around $1.5m for the year.

Ending share count for 2005 is expected to approximately 20m shares.

Now, I would open the phone for any questions.

[OPERATOR INSTRUCTIONS] Our first question comes from Matt Robinson, of Ferris Baker Watts.

Hi, good morning. First of all, let me check my quick math. Does this imply that OPEX in the fourth quarter is going to be something in the range, something like $8.0m to $8.3m?

Yes.

OK, and the royalty ASP was 14 cents in the first quarter, or was it in the second quarter?

It was pretty much the same in that aspect, but I want to share with you some other related data with regards to the overall royalties and prepaid royalty models.

In the past, we have divided out the number of units shipped, using, under prepaid and other [inaudible] royalties. So, going forward, we believe the right way to look at this business is to look at the overall number of 27m units sold by our customers, using our technology. And, if we take into the model the different prepaid royalty agreements, [inaudible] arise in the last few years as part of our business model, we look at that as a pure royalty element, vs. more of a licensing deal.

GAAP-wise and revenue-wise, the current rules of how we recognize them, as you know, this is a one-time charge in a specific quarter, when you license a deal and we have all deliveries made for that. If we build a model and look over the life of the prepaid amount, and recognize them on a per-unit basis, and not as a one-time event, we find ourselves in the range of 9 to 10 cents per unit, times the total number of users, using our technology each quarter.

So, if you do the math, you’ll come up with a bit of a larger number that you could look at this model, going forward, and we look at it as part of royalties. And then, in the prepaid royalty model overall, is a very positive trend for us, because that helps us keep our customers using our technologies in the future generations and in a very high market application. And, on the other hand, we accommodate them. We get paid up front, of course, without any risk associated with their future performance. And, these are very large customers, selling millions of devices. And, we insure the continued activity of our technology with them and making sure that they are successful in their markets, using our technology.

It looks like you’re expecting an increase in revenue, in the fourth quarter, of about $2m over the third quarter. What’s going to cause that to happen?

The changes that we can see are mainly, you know, the growth is mainly through our multi-media platform offerings. We are about to complete the development of this product. This is basically the company’s main focus to finish up this technology with what’s left [inaudible], and release it to the customer.

So you think that, between now and then, these folks that are trying to offer solutions for 3G handsets are going be able to fine tune their product specs enough to go for an integrated solution and start licensing?

Well what we see is that in Japan and Korea there is a lot of interest in these technologies. Now, as you know, people are very much trying to understand the technology and qualify. So, this is our main focus. We have the pipeline. We have the prospective customer base, but we need to get the qualification, which will be done, hopefully, in the first quarter.

So, they’re further along than my question might imply? They’re in a qualification stage? They’ve already kind of focused on the feature set?

Well, you know, in Japan and Korea feature set and the infrastructure for [inaudible] validates it. And they are taking us to their merging, the new technologies there. And what they are doing now is qualification.

OK, and-now, does the DSO, I’m surprised to see that, given the circumstances, you guys taking over the reins and, you know, the implicit sort of pass on the guidance that the market-well, I guess the market didn’t give it to you where the stock is, but some people talked about. Did you have this prepaid deal just come up right at the end of the quarter? Or, why were the DSO up?

There was nothing specifically related to the DSO, vs. other quarters. I could give you [inaudible] that in the first couple of weeks in July we had very large payments that we received already. And if I look at the number today, compared to two weeks ago, it’s much lower than even the 82 days of the last quarter. So, we don’t really see a big issue specifically with going up a couple of days, vs. the previous quarter.

Does your revenue guidance for the current quarter assume that you’re going to have a prepaid deal in there?

Not right now.

So, this is just a pipeline for the new designs, plus—I guess royalties will be fairly low again this quarter, since the seasonal shipments really don’t kick in until the third quarter, right?

We haven’t received any specific reports. Our customers have around 30 to 45 days following the end of the quarter to report to us. We don’t have any definite data right now, base on this. I think it should be more or less flat, or close to that next quarter.

OK. So, your guidance is based on license deals and something $1.5m to $2m in royalties, something like that, and not necessarily any prepaids?

Right, right.

And, should we expect these deals to all close in the back half of the last month? Or, do you think you’re going to get some visibility?

We have visibility, but you know, with licensing you never know. This one of the factors that are not necessarily related to business and technical. [Inaudible] is how to put it.

OK, now, I guess, one more question and I’ll let somebody else ask a few. The expense reductions that you said were going kick in, I guess, they’re coming in but they’re netted against these grants going away in the R&D line. It sounds like that was the reason the R&D was up sequentially. Should we assume that the era of having those R&D grants is behind us?

No, not at all. R&D grants are a continuous benefit that both the Irish and Israeli governments offer for doing research and development activities in both countries. Those, we get occasionally from time-to-time, and they offset some small portion of our overall R&D expenses.

In this quarter, part of the increase in R&D expenses rose about $4.9m in Q1 to $5.5m was due to the fact that we didn’t receive any payments this quarter. Going forward, this has nothing to do in Q3 and Q4 with overall restructuring costs. We look at G&A closely, we cut a lot of infrastructure associated with that, and consultants and advisers and different activities that we think we could handle a little bit more efficiently. We are sure we can, and that, overall, reduces the G&A, the facilities and has some other bearings on other expense lines. But it doesn’t have to do directly with the grants.

But from a modeling perspective, should we assume that this royalty number stays flat here? You must have some visibility as to whether you’re going to get the grants or not.

I believe the GMA and R&D in the next two quarters should be closer to $5.1m.

OK, thanks.

Robert Katz of CenVest.

I have a question about the licensing business going forward, in terms of how much prepayments you anticipate being made, whether it’s one time licensing versus companies starting to step up to the plate for more of a site license, and if companies are paying less up front the more royalty, how that will impact revenue growth. What do you anticipate there?

Regarding prepaid royalties, we don’t anticipate additional prepaid royalties this year, but again, prepaid arrangement is usually driven by the customer. The customer is having an issue in the market, as a result comes to us and shares with us that he is concerned. Now going forward we don’t see any type of transactions where license fees and royalties are being traded, if I understood your question right.

Yes. So they’re mutually exclusive, like you’ll sign a license and a royalty is a royalty, regardless of what the license fee is?

Yes.

And in terms of demand in Q4, it sounds like your Ceva X is going to be one of the drivers for the upside, and you said that’s only with two customers right now?

The demand going forward in Q4 and going into 2006 is mainly for our platform technology. We see a clear change in the customer preference for going to more integrated solutions, not just buying a DSP core, and it used to be in the past the customer had to develop the software. The customer wants our platform, which is a combination of hardware and software, and he will receive the growth account. The reason we see growth here is not just the fact that we see more licensees, but the value of specific deals is higher because we sell hardware and software.

And finally, the GPS market seems to be pretty hot these days, and you have a lot of discreet chip vendors that are doing very well. When do you think that functionality will be integrated into some type of base band or multimedia chip and people will start turning to you for that core?

Well it’s hard to say. This is one of our main concerns about when actually GPS will be integrated into the base band or the multimedia chips. This is our opportunity, the fact that there is a chip market there and we see it there, at this point we cannot leverage on this because customers are not integrated into existing chips. We believe that in 2006 we’ll see more of it; we’ll have a better visibility about this business.

What would be the incremental cost, I mean outside of licensing costs, for someone like TI or some of the other base band companies, Qualcomm, to license that core from you?

You mean incremental cost in the chip?

Yes.

It could be in the range of $1 - $1.5.

Per chip?

Per chip, just adding the GPS, right.

OK, so it is significant.

It’s not significant compared to what you pay for an off the shelf chip.

But ultimately the GPS services have to be in place for the carriers to want to put that as a standard functionality on a phone.

Right. This is another parameter that we are looking at. It looks like the operator wants us to deploy the 3G services. To put the 3G infrastructure, it’s a complex activity by itself, so the operator is saying, “Let us finish the 3G first, and then start the service.”

OK, thank you very much.

Doug Whitman of Whitman Capital.

Thank you. Listening to kind of the outlook that you guys have, which is quite compelling, and looking at your cash balance, it appears the proof is in the pudding, so the simple question is, why not a substantial stock buyback? You’re not burning cash; you have almost two times cash of your revenues. I guess if I was the governor of California I would ask you if you were girly men. It doesn’t follow through, we’re talking about a 10% operating margin in the first half of next year, and in between then we’re not burning any cash, so the cash balances look like they’re going to rise and you have enough cash to do small technology acquisitions on top of it. So could you talk a little bit why your board isn’t more proactive?

Sure Doug. This issue has been raised yesterday when the board of Ceva had its meeting. You have a good point here. On the other hand, the way we currently see this and the buyback activity is to give the new management a little bit more time to put the business plan in place, to put the forecast and where we want to head with different technologies into the market, when we have a little bit of a clearer path then we could have better understanding of where we want to put the cash and invest it for future growth. I do agree with you that buyback is, especially at this point, something quite compelling, and we will address that going forward as well. Right now we haven’t made a positive decision on buying it.

Well maybe only one shareholder. Frankly when you put that all together the stock could be $8 or $9 and it’s not going to be as compelling. I certainly would hope that you guys would go back and revisit that issue this week or next week, because it’s certainly – if you believe your numbers that you’re putting out, which I know you do, and the story is quite compelling of what you’re trying to do, it makes financial sense to do the most conservative thing, which is to reduce your shares outstanding.

I agree, but the way the board is going to talk about it again before the next quarter ends. So we’ll address this quite soon and we’ll see what we come up with.

OK, thank you.

Kenneth Miller, Bonanza Capital.

Hello gentlemen, my question about the stock buyback was just answered. Let me just emphasize a key point, these stock loans, it seems like it really makes a lot of sense. Second is, for your yearly guidance, can you talk about how much you expect of that in your new GPS and audio playback platforms, how much is contemplated in that guidance?

We are not making a breakdown of the different technology in our guidance. Things could change, and we’d like to keep the envelope as our guidance.

Can you tell us if any GPS or audio platform revenue is contemplated in there at all?

There is assumption for GPS and audio in our forecast, yes, there is.

OK, thank you.

[OPERATOR INSTRUCTIONS] David Verghesi [ph] of Brait Specialized Funds.

A question on linearity in the quarter, given the management changes did you see any disruptions to the sales channel in the middle of the quarter, or was it all pretty linear?

There was no issue whatsoever with linearity in the quarter. Licensing deals are closed when we are ready to deliver and the customer is ready to sign more than anything else. It has nothing to do with management changes. This licensing business is from the bottom up, meaning our R&D people explain and try to market the technology to the other R&D side and the product manager, and this is usually not signed by just the CEO on the golf course. This is a very heavy and strategic decision for our customers, we have very good brand names, and customers as you know have been using our technology for many years now and they know us. Other companies know us, and the pipeline is good, like Gideon mentioned, and we didn’t seen anything special due to the management change.

Good. On the $2m in savings that you have targeted for OPEX this year, previously some of the discussion had been a range of $2m - $3m. Are we going to see additional savings next year, or how does that work its way out?

Doing the simple math if we are going to save about $2m just in the second half of this year I assume that when we guide for 2006 that we will be able to save a little bit more than that on an annual basis.

OK, and on your target operating model of 10% for some point in the second half, or the first half of ’06, what level of revenues do you guys need to get to that level of profits?

We will talk about that a little bit more in detail as we progress. We are planning to show growth overall going forward, Gideon talked about the opportunities for 2006 from the different platforms. We hope to show a stronger quarter in our Q3 numbers.

OK great, thank you.

At this time I show no further questions. I would like to turn the floor back over to management for any closing remarks. Hasnain Karim [ph] of Pacific Edge Investments.

Hi there. I’m just trying to understand kind of the hockey stick in Q4, it sounds like revenues are going to bottom in the September quarter, $8.5m, and then like Matt mentioned, it’s going to be up to about $9m - $10.5m in Q4. how much of that is customers working today on your product, and it’s a matter of just signing the licensing deal when they’re ready to take out the chip as opposed to discussions to work on a product today, so that still leaves a lot of room for customers to push that off into next year.

Let me comment just about the numbers and Gideon will comment about the prospects. If you look at the annual number and deduct Q3, Q4 guidance is a range of $9m - $10m versus $8m - $9m. So $2m of a gap is more taking the extreme of both quarters, it’s more $1m of growth opportunity for the fourth quarter.

Going forward to Q4 we believe that we are already engaged with customers at a certain level of evaluation that we target to close in Q4. As I said before, this is multimedia, mainly with Japanese companies, and also there is GPS [inaudible].

OK. Then I guess regarding your break out on a geographic level, could you give that out for the quarter please?

We had about 60% of our revenue in the US market, and about 20% or so in Europe.

Then on OPEX, you mentioned that you’ll be getting some R&D credits in Q3, or that’s what you assume going forward. Why hasn’t OPEX dropped more than the $300,000 - $400,000? The range you’ve given is fairly wide. Why wouldn’t you just assume it would go to the low end of that range?

The range itself is not too wide, the main reasons are a few [inaudible] associated with some different technologies, contractual jobs that we are using and the grants that were not 100% of the amounts in the timing, these are the main elements in the difference in R&D. The grants, by the way, are both Q3 and Q4; it’s not a specific timeframe.

OK, but I guess if you’re expecting $2m in cost savings then realistically OPEX should be between $7.9m and $8.1m for the next two quarters, right?

In the range that we gave, $7.9m to $8.6m is something that we are comfortable with for the quarter.

OK. What do you think are the variables to get it to the high end versus the low end at this point? Is it just the take out of some of the new products?

Yes.

OK, thanks.

[OPERATOR INSTRUCTIONS] Once again I show no further questions. I will now turn the floor back over to management for any closing remarks.

Thank you again for joining us today and for your continued interest in CEVA. Both I and Gideon are very excited about CEVA and the new opportunities, technologies and our key goals for growth and profitability. We look forward to meeting many of you in the upcoming months. Thank you and goodbye.

Thank you. This does conclude today’s conference. You may disconnect your lines at this time and have a wonderful day.