Charah Solutions Inc (CHRA) 2018 Q2 法說會逐字稿

Good morning, ladies and gentlemen, and welcome to Charah Solutions' second-quarter 2018 earnings conference call. (Operator Instructions). I would now like to hand the conference over to Charles W. Price, Vice President of Investor Relations. Please go ahead.

Good morning and thank you for joining us. With me on the call today are Charles Price, Founder, President and Chief Executive Officer; Bruce Kramer, Chief Financial Officer; and Scott Sewell, Chief Operating Officer. We hope you have had a chance to review the press release we issued earlier this morning.

In the remarks today, Charles will provide an overview of our Company and our strategy for continued growth in stockholder value creation. Scott will discuss our business operations and Bruce will review the financial results for the second quarter of 2018. Following our prepared remarks, we will be available to answer your questions.

Before we get started, I would like to remind you that our remarks regarding Charah Solutions include statements that we believe to be forward-looking statements within the meaning of the Private Securities Litigation Reform Act. These forward-looking statements are subject to risks and uncertainties that could cause actual results to be materially different from those currently disclosed in our earnings releases and conference calls.

Those risks include, among others, matters that we have described in our earnings release, as well as in our filings with the Securities and Exchange Commission, including our prospectus and our quarterly report on Form 10-Q. We disclaim any obligation to update these forward-looking statements.

During this conference call, we will make reference to non-GAAP financial measures, reconciliations to the applicable GAAP measures can be found on our earnings release and on our website. With that, I would like to turn the call over to Charles, President and CEO.

Thank you, Charles. Good morning, everyone and welcome to the first earnings call for Charah Solutions. We are excited to have completed our IPO on June 14. Having founded the Company more than 30 years ago and growing our business exponentially over the last 10 years, our IPO marked an important milestone in positioning Charah to take advantage of the tremendous growth opportunities that lie ahead.

For those of you who are new to the Company, we are a leading provider of mission-critical environmental and maintenance services to the power generation industry. We are the only company to offer a comprehensive suite of management and recycling services for coal ash, environmental remediation of ash ponds and landfills and outage maintenance services.

The services we provide at open and closed power plants make us the partner of choice for our customers. We provide on-site essential services to some of the largest regulated utilities in the country that enable them to continue operation and provide necessary electric power to communities nationwide.

Our senior management team has an average of more than 30 years of industry experience. They are supported by our highly skilled workforce who are integrated into the daily operations at our customer sites. Our business model comprises two segments, Environmental Solutions as well as Maintenance & Technical Services. Scott will discuss in greater detail shortly.

Our unique offering, our successful track record and the embedded nature of our on-site presence have enabled us to build long-term relationships with leading US utilities. Some of these relationships date back more than 20 years. These relationships run deep and are cultivated at every level from those in the field all the way through to the executive suite at the power plant and the utility company.

We could not be more excited about the opportunities ahead of us. Coal and nuclear power plants continue to be critical to our nation's power grid. According to the Energy Information Administration, or EIA, these two primary sources supply nearly 50% of our nation's energy and are projected to remain a significant source for decades to come.

Charah Solutions is well-positioned to continue to meet the significant and reoccurring needs of coal and nuclear power plants regardless of whether they are fully operational or in the process of being closed.

Power plant operators are increasingly focused on environmental stewardship and regulatory compliance. In addition, our clients have shown a desire to consolidate the number of service providers utilized across their fleet.

Charah's broad platform of services make us the only provider capable of delivering a full range of services to our customers. With our proven track record of quality, safety and compliance and our specialized workforce, we are and expect to remain the partner of choice for our customers. We think the market opportunity is and will continue to be substantial, which Scott will discuss in greater detail on this call.

In terms of financial performance, our second quarter marked a strong start to Charah's new era as a public company. For the three months ended June 30, 2018, we generated record revenues of $195.7 million, a 26% increase from the first quarter and a 163% increase year-over-year.

Net income was $3.2 million and adjusted EBITDA was $26 million. We delivered earnings per share of $0.13. Key drivers of our revenue growth include the addition of Nuclear Services, strong organic growth in our core business and the successful acquisition and integration of SCB International.

The additions of Nuclear Services and SCB have allowed us to increase marketshare, expand our on-site services and maximize fleetwide opportunities. With our full-service platform, we believe we can continue to increase marketshare in several ways. First, by winning incremental business to service other coal-fired and nuclear power plants. Second, by partnering with utility customers to manage and remediate environmental liabilities. Third, by utilizing technology to recycle non-salable coal ash and make it salable. And fourth, through highly accretive acquisitions that strengthen and expand the services we offer in the marketplace.

Our national reach allows us to pursue new business within the existing customer base and attract new customers while providing high-quality services that meet all safety and compliance standards. These are key decision factors for customers when awarding on-site service contracts. We will continue to invest in technology and process improvements to expand our portfolio of solutions, provide higher-margin offerings and enhance our relevance to customers while assisting them in improving the environment.

At the end of the first quarter, we successfully acquired SCB, which provided us with two technologies for recycling coal ash and other industrial byproducts. Scott will discuss how we are integrating these offerings and how we are rolling them out to customers this year. We are really excited about these technologies and how they will benefit our customers, end users and the environment.

In thinking about our capital allocation priorities, we are committed to a focused and disciplined acquisition strategy that enhances stockholder value. We target acquisitions primarily with our core business that will enhance our existing capabilities and meet customer needs. We believe our national scale and market leadership will enable us to continue to be opportunistic with future acquisitions and we are continually evaluating market opportunities.

On the regulatory front, the EPA changes to the CCR final rules have shifted some utilities' timelines for remediation. However, our review of the changes does not affect our long-term view of the business. Our customers make long-term plans and based on the pipeline we see today, these remediation projects are already in process.

Our reputation for quality, as well as our industry-leading safety record provide a distinct competitive advantage and will continue to make us a partner of choice within the industry. These attributes are key contributors to our leading marketshare position. It is with thanks to our hard-working employees who are some of the best in the world that we continue to be a leader in these areas.

We will continue to strengthen our bench of talented employees. This will ensure we are able to leverage our relationship and strong operational track record to deliver for our customers and continue to create value for our stockholders.

I will now turn the call over to Scott Sewell, our Chief Operating Officer, to discuss our second-quarter operations in greater detail.

Thanks and good morning, everyone. As Charles mentioned earlier, Charah Solutions is well-positioned to continue to meet the significant and recurring environmental management and maintenance needs of power plants across the country. We operate with two complementary business segments.

The first segment, Environmental Solutions, includes remediation and compliance services to meet our customers' need for multiyear environmental improvement and sustainability initiatives and byproduct sales, which supports the desire of our customers to recycle coal ash and other industrial byproducts. Byproduct sales is a market with high barriers to entry and we believe our technology differentiates us and makes us a market leader.

Our second segment, Maintenance and Technical Services, includes Fossil Services and Nuclear Services. Fossil Services is the recurring and mission-critical management of coal ash for coal-fired power generation facilities. Nuclear Services, which we market under the Allied Power brand name, includes routine maintenance, outage services, facility management and staffing solutions for nuclear power generation facilities.

We maintain the largest single fleet of nuclear power plants in the United States. Nuclear Services has grown from zero to more than $300 million in revenue in its first year of operations and we continue to pursue significant growth opportunities both domestically and internationally.

Looking ahead, we see a number of highly attractive near and long-term growth opportunities in our pipeline to enhance stockholder value.

On an annual basis, there is nearly $8 billion in maintenance spend between coal and nuclear power plants. That $8 billion consists of $3 billion attributed to coal ash management and $5 billion associated with nuclear outage and maintenance work. We estimate there is an additional $3 billion pipeline of near-term remediation enclosure projects.

Based on the 1.5 billion tons of coal ashes estimated to be stored in more than 1,000 coal ash ponds and landfills across the country, we anticipate the annual remediation spend to remain elevated for decades and we expect there will be longer-term market opportunities as the nuclear fleet continues to age and requires additional maintenance.

We operate in an industry that requires a specialized contractor with a proven track record. Based on our industry-leading quality, safety and compliance record, we believe we are well-positioned to capitalize on the growing pipeline of opportunities.

We believe that Charah will continue to capture significant marketshare given our existing footprint and the addition of new technologies. We continue to build and execute on a healthy backlog while at the same time identifying and signing new prospects.

In the second quarter, we made significant progress on several remediation and pond closure contracts. We are ahead of schedule on a closure by removal contract at one of the country's largest coal ash ponds. With greater visibility into planned closings, we expect a significant uptick in the number of remediation and pond closure contracts in the next few years, which nicely complements our ongoing maintenance and technical services work.

For example, just last week, we were awarded a contract with one of the largest American power and energy companies for a remediation project that is critical to the utility's regulatory compliance. The team of more than 50 of our talented personnel is eager to start working and ensure that we deliver the high-quality solutions our customers have come to expect from Charah.

As Charles mentioned, we successfully integrated SCB into our Environmental Solutions segment in the second quarter, which doubled our material sales volume. However, what really attracted us to SCB was its proprietary technology that had not yet been brought to market.

Other service providers are beholden to expensive, less flexible technologies. With our technology's self-contained environmental controls and scalability, we see significant potential to make it one of the most cost-effective options in the utility industry as we require significantly less capital to serve our customers' needs.

We continue to expect organic growth opportunities for marketing the grinding and thermal beneficiation technologies. We have been very busy in the initial months post-acquisition. In fact, we are opening two facilities in the third quarter that will put these innovative technologies to use and turn two different industrial byproducts previously not salable into material that we can sell.

The first is a slag-grinding facility in Albany, New York that will allow Charah to deliver a highly beneficial cementitious material to the market, which we will be able to produce for a fraction of the cost of competing technologies. Not only will this increase the profitability of our operation, but it will also increase our return on invested capital.

The second is a fly ash beneficiation facility in Louisiana that is strategically located at one of our terminals, enhancing our market position and allowing us to make use of our multisource approach to selling fly ash. These facilities are already attracting customer interest from underserved markets and we plan to replicate this model across the country to take advantage of these market imbalances.

As Charles mentioned, our customers make long-term plans and much of our business is built through relationships and maintaining a strong reputation. We maintain a focus on hiring, developing and retaining the right personnel to support our clients' specialized needs and strive to meet the highest safety standards.

Consistently, year-over-year, our teams receive awards recognizing their safety efforts, which are further proof of Charah's uncompromising commitment to this facet of our business. We are proud of the dedication of our employees in supporting our industry-leading track record, which makes us the partner of choice for our customers.

With that, Bruce, our CFO, will now review our second-quarter financial results. Bruce?

Thanks, Scott. Good morning. As Charles mentioned, we delivered strong performance in the second quarter of 2018. For the three months ended June 30, 2018, we generated record revenue of $195.7 million, a 26% increase from the first quarter and a 163% increase year-over-year. The year-over-year growth was driven primarily by the addition of Nuclear Services, strong performance in remediation and compliance services and our acquisition of SCB.

In our Environmental Solutions segment, we generated revenue of $90.1 million, an increase of more than 46% from the second quarter a year ago reflecting both growing ash sales and the impact of the SCB acquisition on volumes of materials sold.

We grew our Maintenance & Technical Services segment revenue to $105.6 million from $12.8 million in the same quarter a year ago, primarily attributable to the addition of Nuclear Services. Excluding Nuclear Services and the acquisition of SCB, our core business across both segments generated organic revenue growth of approximately 17% in the second quarter compared to the same quarter a year ago.

Gross profit increased $10.1 million or 49% for the second quarter to $30.5 million from $20.5 million in the second quarter a year ago. Gross profit for Environmental Solutions increased $4.6 million or 26% for the second quarter to $22.1 million from $17.5 million for the second quarter a year ago. The increase was attributable to the net overall increase in gross profit within remediation and compliance services in addition to gross profit related to the acquisition of SCB, as well as higher margins.

Gross profit within Maintenance & Technical Services increased $5.5 million or more than 180% for the second quarter to $8.5 million from $3.0 million for the second quarter a year ago. The increase was primarily attributable to the addition of Nuclear Services. In fact, within Nuclear Services, we have completed seven outages year-to-date and a total of 11 outages since starting Allied Power and expect an additional 7 outages in the second half of the year.

When we exclude the Nuclear Services and SCB, gross profit increased organically by approximately 15% in the second quarter compared to the second quarter a year ago. General and administrative expenses increased $11.5 million in the second quarter to $18.9 million from $7.5 million for the second quarter a year ago. The increase was primarily attributable to additional expenses associated with the addition of Nuclear Services and SCB, notably $4.3 million in one-time nonrecurring and nonoperating costs.

Operating income for the second quarter was $11.6 million, a decrease year-over-year as a result of the increased general and administrative expense; a large portion of which was nonoperating and of a one-time nature. Interest expense increased $3.8 million for the second quarter to $5.5 million from $1.7 million for the second quarter a year ago attributable to the term loan signed in the fall of 2017.

From our completed IPO, we received net proceeds of approximately $59.2 million prior to deducting operating expenses and after deducting underwriting discounts. We used a portion of the proceeds to repay approximately $40 million of borrowings outstanding under the term loan, which resulted in a gross leverage of 2.8 times LTM EBITDA. The Company believes this will allow us to refinance debt at lower rates with expected interest savings.

Net income decreased $7.6 million for the second quarter to $3.2 million from $10.8 million in the second quarter a year ago. The decrease was primarily attributable to increased G&A expense, including $4.3 million in one-time nonrecurring and nonoperating costs and a $3.8 million increase in interest expense, as well as $2.9 million in income taxes due to the Company becoming a corporate taxpayer after the IPO. We delivered earnings per share of $0.13.

Adjusted EBITDA for the second quarter increased $6.1 million, or 31%, to $26 million reflecting adjusted EBITDA margin of 13.3%. The adjustments are related to non-operating and one-time expenses.

With our IPO, the second quarter included only 13 days of net income subject to corporate income taxes. We currently project not paying any cash taxes the rest of this year primarily driven by the new federal tax law changes that will enable us to immediately expense the cost of equipment purchased in 2018.

Charah intends to provide guidance beginning with full-year 2019 when the Company reports financial results for the fourth quarter and full-year 2018. With that, I will turn the call back to Charles for some closing remarks.

Thanks, Bruce. Before we move to Q&A, I want to thank all of our tremendous customers for their partnership, our incredible employees and all of you for joining today. For the remainder of 2018 and beyond, we are focused on strengthening our position as the market leader in environmental and maintenance services to the power generation industry and creating long-term value for our stockholders. With that, I will open it up to questions.

(Operator Instructions). Toni Kaplan, Morgan Stanley.

Hi, good morning. Can you talk about some of the legal appeals taking place in North Carolina related to the rate order for Duke that allows it to charge customers for cleaning up coal ash operations? Is there a risk that it could be overturned and if so, is there a long-term tail risk that more states won't allow the pass-through of ash cleanup costs to customers?

Thanks, Toni. I appreciate the question and just wanted to point out that what you've seen so far from the North Carolina regulators and from the state of North Carolina is that it was planned and from the ratepayer -- or from the court's perspective those regulations were planned.

Okay, got it. And on Maintenance & Technical Services, I think it came in just a little bit lighter than what I was expecting. Was there a timing or other factors that drove that this quarter?

No, Toni, that primarily related to one outage being completed about a week in advance, which adversely impacted our revenue, but certainly the positive side of that is we are delivering the services on time and on budget, which is why Exelon hired us in the first place. So that's what I attribute to the revenue decrease.

Okay, thanks so much.

Hamzah Mazari, Macquarie.

Hi, guys. This is actually Mario Cortellacci filling in for Hamzah. I just wanted to ask about the legal expenses. Could you give us an update on the active nuclear lawsuit and so the legal expenses could be pretty high and maybe you can give us a sense of how we should be thinking about that and maybe the timing of it as well.

Sure, Mario. Appreciate that. As a policy, we do not comment on ongoing litigation, but our focus is going to be continue on the day-to-day business and executing our growth strategies and initiatives.

Got you. Okay and maybe just a quick comment on coal plant shutdowns. Could you walk us through how that impacted the P&L, both positively and negatively? You gained remediation work, but you also lose out on some day-to-day revenue. Could you walk us through how that impacts the business?

Sure thing. Very easy the way we view it. Like you said, you captured it very well for us. Our Environmental Solutions segment capitalizes on those opportunities where plants shut down and it accelerates the remediation timeline and our Maintenance & Technical Services side of the house is positioned to keep pace with the operating plants.

I think it is important to know that we have reviewed some of the recent closings that have been announced. None of those sites are where we operate today, so all of our current operations will continue to move forward and there is also a large marketshare for us to continue to increase in those other sites that are going to operate for the foreseeable future.

I think it is also important to note that according to the EIA, coal and nuclear supply will be nearly 50% of our nation's energy and projected to be significant sources for decades to come. So we feel good about our position right now.

All right. Thank you so much.

Michael Feniger, Bank of America.

Hey, guys, thanks for taking my questions. I think you did a 15.5% gross margin in Q2. Do you still expect gross profit margins of like 13% in the second half and recovering to 14% maybe in 2019? I'm just wondering if anything happened in Q2 that kind of shifts or changes the trajectory in what you guys are feeling with the gross margin there.

No, I think that's directionally correct. We expect the margins to continue as expected.

Okay. And then I think you made a comment I'm just curious about. You have a new guy in the EPA, running the EPA. He made some announcements or changes on the coal ash regulations. I think it was mostly on groundwater, but it does feel like there might be more flexibility. There is no denying, but you guys are saying that these utilities are going to have to spend and cleanup their coal ash ponds. But at the same point in time, does the new EPA administration and some of the new guidelines, does this give more flexibility for utilities maybe to shift to the right, maybe delay some of these announcements that we could be expecting in 2019 or does it shift it out just a few months or quarters? I'm just curious how those dialogues are going right now with the utilities.

Sure. And we work very closely -- as we've discussed earlier, those long-term relationships we have were zippered up and down the utilities of the leadership chain at the field level and at the environmental side, as well as the C suite. And our customers are making long-term strategic capital decisions and don't adjust on the passing whims of political agendas or administration changes. So we really see that work remaining as we've projected it.

The industry views the current CCR regs as part of the permanent compliance framework and they have already announced those billions of dollars of spend that I mentioned earlier in the commentary and we continue to expect to take a significant share of that.

So if you think about the EPA changes to the final reg that you are referencing, they've shifted some of the utilities' timelines, but our review of the changes doesn't affect our long-term view of Charah's business nor impact on the projections of those projects we've already anticipated.

Okay, so just to be clear, because you mentioned a comment in the beginning of the call about just -- about the difference of the timeline. I understand what you are saying on the long term, but does the new regulation or the new guidelines, does this actually potentially give more leeway for utilities to hold back, wait to see how things develop and maybe just shift the timeline a little bit like you guys mentioned earlier? I'm just trying to get some clarity on that.

Yes, the way to frame that or think about that is technically it does give them a little more leeway; however, your question, how is our dialogue going with the utilities right now, the majority of them are going to continue to do what's right and continue to execute their long-term plans, again think about a lot of these remediation projects. They take years to develop from an engineering perspective and from a due diligence perspective and they are already a long ways down the road on several of these projects, especially the ones in the near term that you are thinking about. And they are going to continue to execute on them.

That's great. And then can you give us just a little bit more color? You mentioned you guys won an award on the remediation side. Is this a multiyear type contract, does it give you visibility into 2019? I am just thinking into -- I understand you are not guiding on 2019, but based on your visibility, do you still feel comfortable with that? You did organic growth, I think you mentioned like 17% in the quarter. I mean should we be thinking on the remediation side based on this contract and your visibility into 2019 that you should feel comfortable with above 15% growth next year just based on winning this contract?

That contract is a great example of our ability to get organic growth and continue to grow organically or just to continue to grow in general. Unfortunately, I can't speak specifically to the specifics of that contract. We have to respect the confidentiality nature of some of our contracts and our customers and can't disclose the specific details. But it's just a great example of us again being recognized as one of the leaders in the industry. This is a very important project to our customer with some pretty tight deadlines as well as far as compliance is concerned and we are really excited to get out there and complete that work.

That's great. And if I could just squeeze one more in. I know we talked about the gross margin. I'm just curious on the cash flow side. Do you guys -- is there any change in development after the second quarter? Do you still expect operating cash flow to turn positive at the end of this year and with your CapEx, is there any change right now in the outlook of what you guys have finished the first half of the year and how you might be expecting for the second half to shape up?

No, I think the cash flow expectations are consistent with what we had previously communicated.

(Operator Instructions). Corey Greendale, First Analysis.

Hi, good morning, thanks for taking my questions. First, in terms of -- I appreciate the color on the organic performance of the business. I was hoping you could give a little bit more commentary around the drivers of the 17% organic revenue growth like where particularly you saw strength. I think you said gross profit grew 15%, so it sounds like there was a little bit of just slight margin compression. Is that mix or what drove that?

Yes, that was mix and the organic growth came from all sectors of the core business with the largest portion of that coming from the Environmental Solutions segment.

Okay. And in terms of the new SCB facilities, can you give us some sense of what startup costs are associated with those CapEx or operating costs and then what revenue contribution we should be -- or profit contribution we should be expecting from those over time as they ramp?

Sure, Corey. This is Scott Sewell. Just wanted to kind of touch on the SCB acquisition. I know I had several comments in the script earlier. However, we continue to expect organic growth opportunities coming from both the grinding facilities and the thermal beneficiation facility that we are putting in place right now.

As far as -- those two facilities are going to open in the third quarter. We are already attracting a lot of customer interest from those underserved markets and we are going to plan to replicate that model across the country. Specific to CapEx associated with those facilities or any other facilities in the future, we've again kind of focused on -- what we really like about that technology is the scalability of it. So the CapEx is going to vary from site to site as we move to these different markets and are able to deploy that technology.

So to be able to give you an exact number on CapEx is going to be a little difficult right now as we continue to move forward, but again those units that we are going to be deploying are going to have varying capital levels as well as the ability to -- just that flexibility that we spoke to earlier is really what excites us about those technologies

Yes and this is Bruce. I will add to that. The CapEx expectations are consistent based on what we've seen today with what we had put in the original model. So no surprises at this point and expect those to continue as expected.

Okay, and if I could just sneak in one more. As far as uses of cash and the leverage, you made a comment about future acquisitions. If you could, maybe put -- I understand sort of conceptually what kinds of things you are looking for, but should we expect more things like SCB or would you do larger acquisitions and in terms of the leverage level, are you comfortable at 2.8x or do you expect the primary use of cash will be to continue paying that down?

Yes, we feel very comfortable at 2.8. We believe it positions us very well with our competitors and others in the industry. We will continue to focus as we've said on organic growth, but that said we will continue to look at acquisitions that are strategic like SCB that brought with it the two technologies. So we will continue to look for acquisitions that are synergistic and opportunistic, but our primary focus will continue to be on organic growth.

Great. Thanks very much.

Brian Butler, Stifel.

Good morning. Thank you for taking my questions. Do you have a breakdown within the segments on the revenue and gross profit? So for like remediation and byproduct sales and fossil services and nuclear or is that going to come out in the Q?

No, we will only be reporting at the segment level. We will not be providing information at the subsegment level.

Okay. Then on the SG&A, if you take out the nonrecurring in the quarter, you are running at about 14.5 for the quarter. Is that the right pace going forward or is that going to be coming down in the second half?

It very well could come down some in the second half, but I don't see any material changes from what you are seeing.

Okay. Going back to on the growth line, the 17% organic, mostly coming from Environmental Services, can you give some color on how much of that was from Duke versus other customers? I mean I don't need a specific breakdown, but was Duke's growth in line with that 17% more or less? Just trying to understand kind of what that concentration is looking like going forward.

Yes, if you think about that concentration going forward, it is going to continue to shift, especially when we have highlighted the contract we picked up last week with another major player in the utility industry. We are going to continue to diversify and continue to build that book of business that we had out there. So I don't think it's a 1-for-1 in that scenario.

Okay. And then on the cash flow side, the working capital in the first half of 2018 was a pretty big use, about $25 million. How should we think about working capital in the second half with you building out the new facilities? How should we think about that trend? Is that another big use of cash and that corrects then maybe in 2019 or does that really come back in on the second half and it goes the other direction?

Yes, the working capital build was consistent with what we had modeled in the first half of the year and the facilities that Scott referenced or talked to you about CapEx on the -- talking relative to the new technologies, so nothing out of the ordinary in those.

Okay, so are you going to be a user of cash again in the second half for working capital?

Expect it to be consistent, relatively consistent with the first half of the year.

Okay. And then last one, do you have a timeline on your refinancing? Is that a second half of 2018 or is that a 2019 kind of event?

It is something that we are exploring now with institutions and we hope to have that done here within the next quarter.

Okay, great. Thank you for taking my questions.

And we have no further questions in the queue at this time. I will now turn the call back to the presenters for closing remarks.

This is Charles Price. I want to thank everyone for being on the call today. It's been an exciting time now that we are a publicly traded company and we look forward to future calls with everyone. Thank you.

Thank you to everyone for attending today. This will conclude today's call and you may now disconnect.