Carlisle Companies Inc (CSL) 2006 Q4 法說會逐字稿

Good morning.

My name is Rashara, and I will be your conference operator today.

At this time, I would like to welcome everyone to the Carlisle Companies fourth quarter earnings conference call.

[OPERATOR INSTRUCTIONS]

I would like to turn the call over to Mr. Richmond McKinnish, President and Chief Executive Officer of Carlisle Companies.

Thank you, sir.

You may begin your conference.

Thank you.

Good morning, everybody.

Welcome to our earnings call.

With me as always is Carol Lowe, our Chief Financial Officer.

As usual, our comments are going to be very brief.

Quite frankly, we're tired of talking about 2006, and we're ready to move on to 2007.

If you've got our press release in front of you, and hopefully you've gone online to our website, which is carlisle.com, there's a lot of information there.

We think it's quite complete and explains the fourth quarter in 2006, so Carol and I are not going to spend any time on that.

Carol will take over and highlight some financials of '06, and I'll make some comments about outlook, and we'll go to the Q&A.

We'd really like to address most of your questions about 2006 in the Q&A session.

So with that, I'll turn it over to Carol.

Thank you, Rick.

Carlisle wrapped up '06 with record fourth quarter and full-year earnings.

I want to note that the earnings release includes a supplemental schedule highlighting certain income and expense items for 2006 and 2005 on a per share basis.

This information is provided to assist in your comparison of the year-over-year results, and as the release states, we feel like we had a very strong or record fourth quarter 2006, full year '06 and are expecting a record 2007.

As many of you know, it's our practice to absorb startup costs related to new facilities and integration costs related to acquisitions within our reported financial results without much discussion or quantification.

With our commitment to organic growth and acquisitions, we will most likely always have some level of startup and integration costs that impact our earnings.

With that said, I do, however, feel like it's appropriate to address certain costs associated with our braking business, which is reported in the Specialty Products segment.

The operating loss reflected in the fourth quarter '06 includes final adjustments for the allocation of the purchase price of the ArvinMeritor assets for our off-highway business.

Identification of certain intangible assets resulted in a catch up of amortization expense in the fourth quarter.

Fourth quarter and full-year results also reflect integration and startup costs for both the on-highway and off-highway acquisitions.

We relocated an entire production facility in the U.K., made significant product changes in our China operations, and incurred numerous transitional costs.

While all of these activities are operational in nature, they did result in additional pre-tax expenses during 2006 of approximately $3 to $4 million.

These costs are not reflected on the supplemental schedule that I referenced earlier.

Our braking business also incurred significant raw material cost increases, most notably for [Brow].

Our on-highway business has recently implemented a 5% price increase for most of its friction products, as well as a 7% price increase for its [inaudible] products.

The earnings release reflects an effective tax rate on continuing operations of 25.3% for the fourth quarter and 30.6% for the full year '06.

We've highlighted for you on the supplemental schedule the one-time benefits that resulted in these rates.

We expect our effective rate for '07 to be 32.5%.

Now, I want to make a few comments on the balance sheet and cash flow.

The $144 million of cash on hand at year-end reflects the sale of the Carlisle Systems & Equipment businesses during the fourth quarter.

Proceeds for the transactions were approximately $111 million.

The accounts receivable balance at 12/31/05 excludes about $138 million of trade receivables sold through our securitization program.

There were no trade receivables sold at December 31, 2006.

Please take this into account when you compare our cash flow and working capital on the cash flow statement.

We've included another supplemental schedule for you so you can do the comparison on the cash flow.

Also, you've no doubt noticed the increase in inventories on our balance sheet.

The increase was planned for first half 2007 anticipated demand for construction materials and industrial components.

As evident upon your review of the balance sheet and cash flow statement, you'll see that we've increased our absolute working capital numbers by approximately $86 million.

As a percent of sales, however, our working capital is comparable from '05 to '06 at approximately 20%.

Our strong organic growth has necessitated a commitment to adequate levels of working capital.

I'd like to emphasize that cash flow is a priority for the management team for 2007.

We will be focused on optimization of working capital levels and increasing our operating cash flow.

I'd also like to just throw out a few data points that will hopefully answer some of the standard questions we get on every call.

For 2007, our estimated capital expenditures are $75 million.

Also for '07, depreciation and amortization expense is estimated at $60 million.

Our pre-tax pension expense is estimated to be flat with 2006 at approximately $6 million.

With that, I'll turn the call back to Rick for his comments.

Thanks, Carol.

I'm going to go through the reporting segments, and really my comments are going to be primarily forward-looking.

The first segment is Construction Materials.

And as you know, that's primarily our commercial roofing business.

Our outlook -- there's been a lot of discussion about commercial construction and where it's at in the cycle.

Our current outlook is for solid growth in '07 on an annual basis.

We've talked a lot in the past about our expansion out West that continues to grow at an above-average rate.

We've announced an expansion of our roofing membrane plant in Utah, so we continue to look for strong growth in the West improving some softening conditions in certain areas, but overall very solid growth outlook for '07 in Commercial Construction.

There's also a theme we've talked about in the past, which is energy cost awareness.

This continues to drive increased demand for our products, especially insulation, and we see this trend of energy awareness continuing as very healthy for our roofing business.

The next segment's the Industrial Components segment.

We've had a series of management meetings, and I will tell you that there's more optimism and confidence going forward than we've had probably this decade in this business and it's for several reasons.

First off, we had the best new business or new customer year last year in '06 that we've had since 1999.

They secured about $40 to $50 million of new customers and new business for the upcoming year.

We had improved earnings in our tire business in 2006, in spite of unprecedented raw material increases and a very soft lawn and garden market, which has been well documented in both 2005 and 2006.

In spite of that, we've grown earnings.

Our outlook for lawn and garden is improved for '07 because of reduced inventories at most of our customers.

The other major issue for this business has been raw materials.

While the prices remain volatile, we see the significant continued upward pressure on raw materials is not there.

In our estimate for '07, it should be a much better year in this business for raw material costs increases and we've recovered the raw material cost increases in the past, so this should help us going forward.

And finally, after several years, we've secured a new tire plant in Asia.

We announced several years ago that we closed down the tire plant in Trinidad for a number of reasons, and it's taken us some time, but we now have finally closed on a new facility in China.

We've been buying each year for the last several years over $60 million of tires from our competitors.

This reduces our margins by over $6 million pre-tax a year, and we now have a solution to that problem going forward.

The next segment is Specialty Products, which is our braking businesses.

I think Carol has spent some time explaining the results.

I would simply say that we look forward to better results in the future.

I would point out to you, if you look at the segment financial data in the press release, and you look at last year in General Industry, you'll see a much reduced result.

Our earnings in General Industry in the fourth quarter of '05 were 1.5% on sales.

This year they're up nicely.

When we have a problem in a business -- in other words, this business is not making progress, it's not achieving our objectives, we have a term here that we call we blow it up.

We're going to do something about it.

A year ago, we spent all our time discussing General Industry because we were blowing it up.

Well, this year we spent all our time discussing Specialty Products because we're blowing it up; we're fixing it; we're changing management; we're making major strategic changes; and this is going to be a very good business for us going forward.

So we're making the same comments today that we made last year about General Industry, and we think we'll sit here next year and be able to show you some nice improvements.

I will say that all the restructuring changes that we've done, it seems like for the last several years we've had a series of these restructurings.

We truly believe our downsize portfolio that we're getting at the end of that cycle, and it's going to be much less of this restructuring and fixing up going forward.

The next segment is Transportation Products.

This is led by Trail King, our specialty trailer business.

They've executed several large capital projects this year to increase capacity and reduce costs.

We're excited about this business.

They are well positioned going forward to participate in all types of construction and infrastructure rebuild.

We're pleased to have Trail King in our portfolio.

The last segment is General Industry, and the two primary companies here are our food service business and our high performance wire and cable company, Tensolite.

These businesses have both been performing well.

You can see the comparisons.

We're excited about '07.

I would tell you that the open orders at Tensolite are up over 40% as we enter the year.

I'll make a couple of comments about two acquisitions that we've closed on in the last couple of weeks.

First is Tensolite.

We purchased a low-cost manufacturer of wire and cable assemblies that are located in Dongguan, China.

This was a missing strategic plane for Tensolite.

We can now better service our existing customers in the U.S. and China.

We have already demonstrated solid growth in this business over the last several years, and we think this acquisition will allow us to accelerate the growth at Tensolite over the next several years.

We have a lot of costumers committing a lot of infrastructure to China, and we're now positioned to supply them their needs.

The other acquisition that we had talked about, a letter of intent several weeks ago, we've now closed.

We closed last week on the [Meyan] Tire Company.

This is in southern China.

This gives our tire and wheel business the capability to manufacturer a significant volume of tires, which we outsourced in the past, which I quantified for you in the comments earlier.

This also enables us to develop new products, expanding our product line coverage in the farm and construction equipment tire business.

We believe we are now the low-cost producer for farm construction equipment tires, and we're excited about the growth opportunities in that business.

And finally, I'd like to make a couple of comments about our guidance -- the guidance for '07, which was released this morning with a range of $6.35 to $6.50 per diluted share.

This does not include any acquisitions.

Based on our current acquisition pipeline, the probability of no acquisitions is very low, or stated another way, we will have acquisitions in '07.

That concludes our comments and we'd like to turn it back to the operator for some questions.

[OPERATOR INSTRUCTIONS]

Your first question comes from Deane Dray with Goldman Sachs.

Thank you.

Good morning.

Good morning, Deane.

Hi.

First question is on cash flow, and Carol, can you help us reconcile the third quarter cash conversion?

By our calculation, it looked like it was somewhere in the neighborhood of 20%, and it looks like that improved in the fourth quarter to 80%.

Is there anything on the way you're reconciling the accounts receivable securitization that would change that?

Actually, it's -- we still have some seasonality in our business, Deane, and a lot of the cash flow from construction materials is realized in the fourth quarter.

And so you're seeing a lot of that impact.

It's just largely seasonality, but there was nothing outstanding on the securitization at the end of the third quarter, and there's nothing outstanding at year-end.

And for the year, it still looks like you came in below 100%.

Is this -- Rick, do you have a specific cash flow conversion goal for Carlisle?

Yes, we do, and I think Carol made some comments about that's a major objective for us in '07 is our cash flow.

I will tell you, Deane, that what's happening -- we didn't talk about it, but we grew organically, I think, 14% to 15% for the year, and there's no question that with that kind of organic growth rate our cash flow as a percent of net earnings tends to get less than 100%.

We think that our businesses, the way we're structured, that with the normal kinds of organic growth rates you heard about in that 6%, 8%, 9% that our cash flow generation should be 100%-plus of net earnings, but I will tell you, we'd like some credit for 15% organic growth rate, which does -- especially in roofing.

Our roofing business is our largest consumer of working capital.

It's also got a very high return on invested capital, but yes, we're putting in plans in place.

We think long term our portfolio -- we're capable of cash generation 100%-plus of net earnings.

That's our long term goal.

All right.

And then just when you mention the construction materials, at this stage, you said you were building inventory in the quarter.

Typically the roofing business does not have a lot of pure inventory, at least for stock that we know of.

What was -- is that -- is it accessories?

What would be the inventory build there?

Well, Deane, I mean, I think part of this -- a lot of that inventory build is -- remember, we've been expanding rapidly in the West with our roofing membranes and with insulation all over the country.

And you're right.

We're entering '07 with a lot more fire power.

There's several more insulation plans with inventory in our portfolio.

And so a lot of this, quite frankly, is just expanded infrastructure and inventory to service the entire Company.

We've been going through that.

Now, that rate of expansion on insulation is going to slow down going forward, but remember, we're entering '07 with several more insulation plants than we had this time last year, and that explains a lot of the inventory change.

Yes, and also, the TPO plant was just coming online at the end of '05, and it's been up and running in 2006.

So you have a minimum level of inventory that you need to support an entire new TPO plant.

Deane, these guys have grown their return on invested capital over the last three years even though we spent a ton of capital in that business, and they're very much on top of it.

When they build inventory, they grow their business, and that's how we see it.

I know you mentioned the organic growth of 14%, 15% clip.

One of the things that we'd looked at is what portion of the insulation, on a same-store basis, may be contributing to that.

It's been running around a 4% contribution, so is it fair to estimate on a same-store basis if we look at volumes more of a 10% organic growth?

Is that still a fair comparison?

Are you representing -- the 15% organic growth, 14% or 15% depending on whether you're talking about the quarter or year, that's the overall organic growth for our Company.

Right.

You're talking something about the organic growth for our Construction business?

Well, if we were to look and strip out what the contribution was from the insulation plants that have come online to try to look at it on more of a same-store basis, would that be closer to a 10% organic growth?

Okay.

I see, you're looking for -- yes.

Well, there's no question -- you know, there's several trends here, Deane, and I think if I had to look at a longer-term number for Construction Materials organically, it would be 6%, 7%, 8%.

There are several things here.

We've got good trends.

Insulation is going to grow.

Energy awareness is going up.

Retail, as you well know, is showing some softness.

Other areas are showing some strengths, so yes, I think the organic growth rate in roofing is going to moderate.

What is that organic assumption on your $6.35 to $6.50 guidance?

Maybe -- I don't need it for specifically for Construction Materials if you have it, but what are you baking in for -- at the low end and the high end?

We're banking in high single-digits organic growth across the company.

Okay.

But, Deane, in terms of the numbers that you're looking at from an earnings standpoint, I mean, we're looking at 14% to 15% earnings growth, and that is all based on the existing business and organic growth.

Again, there's no acquisitions in that number.

I understand.

And then just if I could ask a couple questions on the brake business, and what are the specific businesses that are resulting in this charge?

Does this go back to Kete or is it all Arvin?

And were these in the original integration plans?

Or has something new developed here?

They -- it relates to both Kete, which was the China acquisition and the ArvinMeritor asset.

There were some costs that were estimated for the integration.

There were unanticipated costs, and the $3 to $4 million that I referenced was in addition to what we had estimated.

The relocation for the Wells facility took longer than what we anticipated.

We had to pay transition service fees to ArvinMeritor for a nine-month period while we relocated those assets.

We also for our re-manned business changed some strategic things.

Their business model frankly just wasn't working so with some of those changes we incurred certain costs.

Included in that $3 or $4 million there were also some currency impacts because a lot of the re-manned happens in Canada and we bring it back into the U.S. and we had not appropriately addressed some of the labor costs, so that's why we made the price increases at the beginning of this year, both on the friction side, as well as the re-manned costs.

Right, and I appreciate how you all flow this right through operating results and call it out.

That's very helpful.

Just was there anything that -- for these integrations that had been previously run through purchase accounting reserves?

No.

We don't set -- we don't do that.

Okay.

I mean, it's -- that is within the spirit and letter of purchase accounting.

You are able to set up reserves for integration of plants that you know you're going to close, but some companies don't opt to use that, and I wasn't sure whether you had used it for these transactions.

No.

We're very conservative in how we handle that.

I appreciate that.

Thank you very much.

Thank you, Deane.

Your next question comes from Peter Lisnic with Robert W. Baird.

Good morning.

It's actually [John Holtzoffer] calling in for Pete.

Just have kind of two questions for you.

First, on the acquisition front, I mean, historically you guys have kind of been disappointed with the pace of acquisitions, and I think part of that has been pricing or just desire on your part not to overpay, and has the pricing environment changed, or kind of it seems like you're more insistent or the pipeline is better now.

Could you just elaborate?

That's a good question.

I don't think that the pricing environment has changed very much.

I think that -- we talked, I think, a year-year and a half ago that we were understaffed in business development, that we had to devote more resources.

Quite frankly, we have put so many of our companies through some restructuring.

We didn't think they had their business model correct, so what I tried to announce six months ago is we've added substantial resources, senior resources, to our business development staff.

Our businesses in our portfolio today are all platforms for growth, so we really just started mining and farming at a much more aggressive rate and as a consequence, our pipeline, quite frankly, is the best that I can remember it.

So we're excited about acquisitions.

They'll all be the kind of acquisitions that we've always done whether they're competitors, they're logical extensions, they're bolt-ons, and we think the numbers will work and work handsomely.

So it's really not a question of the valuations changing.

It's just a question, I think, of us mining and farming harder and buying the businesses where you can pay today's multiple and because of synergies, the numbers really work for us.

Does that help?

Yes.

That's great.

Okay.

And then switching over to Construction Materials, can you just kind of walk through what the, if any, impact kind of the warm December and January had, and then kind of what the current cold snap means in terms of kind of current quarter activity, and then also what it means for kind of the future?

Well, listen, John.

I mean, I'm not going to talk so much about current quarter, but I will tell you the general guidelines.

Warm weather and good weather is good for the current quarter.

It lets roofers go on the roof.

Bad, horrendous weather like we're having in certain areas today hurts that current period, but helps future periods because this frigid, freezing, that hurts the roof, so warm weather and good weather helps the current quarter.

Bad weather hurts the current quarter, but helps future quarters because it creates leaks in the roof.

So that's pretty much -- and we're not weather experts.

We'll let you with that knowledge create your model for this quarter.

Okay.

Thank you.

I'll get back in queue.

Thank you.

[OPERATOR INSTRUCTIONS] And your next question comes from Saul Ludwig with KeyBanc.

With eeking it out being defined as 15%, I'm glad to see you're going to eek it out this year, Rick.

We appreciate that.

That's high praise from you, Saul.

Can you talk a little more about these two acquisitions, the Tensolite and the tire business that you just bought?

How big are they?

How much do you spend for these things?

And when do they start to kick in?

When do you make the tires?

When do you make the products on Tensolite?

They sound exciting, but give us a little more color on them.

Okay.

Well, first Tensolite -- it was a small acquisition, and there's nothing in that acquisition that we put in our '07 guidance.

It's just a major missing link we've had.

As you know, Tensolite supplies a whole host of high performance assemblies to a variety of customers, and without an Asian presence, we've been unable to fulfill their needs in that region of the world.

So, and they've been asking us to get over there, but in our normal fashion it's taken us a little while, but we've got a very low cost, highly technical wire and cable assembly house and it's on the ground.

We own it 100%.

No joint ventures.

We're going to operate it our way, but we think, quite frankly, even though Tensolite's backlog is up, and they're going to have some very nice comparisons in '07, this acquisition will be more of an '08 event, and it's not in our '07 guidance.

There might be some upside late in the year, Saul, but we'll report to that later in the year.

Now, on the tire side, this is, as you well know, a really missing link for us.

Quite frankly, it's taken us a long time.

We were going to do a green field.

We decided no.

We've done a green field before in China.

That's our existing plant.

We wanted to find an existing plant and so we're pleased to announce that this plant's up and running.

We own it 100% once again.

Its cost and its location are lower than our existing plant.

Labor costs are lower.

Utility costs are lower.

We've got a sizable amount of acreage here for expansion.

Raw material costs are very good in this area of the world, and we can say with a lot of confidence, unlike a lot of the other players in this field, with high costs, legacy costs, we're excited about our building to bring construction tires and ag tires into the U.S. market.

And rest assured we've got over 50 tires in development as we speak, and we're already producing, quite frankly, over a thousand tires a day, and we just owned the plant for a matter of a couple days.

So our whole tire and wheel company, we've been treading water, quite frankly, Saul.

I mean, we've talked about this.

We've been unhappy with this sideways -- we've got a very strong tire and wheel business.

It's the best, quite frankly, specialty tire business in the world.

It's underachieved.

It's not growing at the rate it should, and we're excited about it.

I think we're going to return to some of the old days here, and we just had a sales meeting there, and I can tell you -- and we're getting a lot of new customers.

We believe the future in these businesses is low-cost production and we think that the companies that are continuing to invest in these higher cost production locations are wasting their time.

And so we're excited about both these, but nothing here from the tire business or Tensolite is in the '07 guidance, but there's a possibility for some improvements to guidance if things go well for late '07.

How much in sales dollars do you think this business will contribute in '07?

Which one?

Both Tensolite and the tire acquisition?

How many incremental sales dollars do you think will -- and I realize it's a little bit of -- you can't be so precise, but what arena are we talking about in terms of additional revenues this year and maybe '08 if you want to look at it as a two-year deal?

Well, '07 primarily -- let's take the tire plant because it's far and away the larger one.

The tire plant, as we talked about in our comments, we've been purchasing well over $60 million of tires from our competitors.

That costs us a lot of money, and we put it in our call that we think there's $6 million of EBIT improvement just bringing those tires.

So the neat thing about this tire plant we bought, we're not interested in the passenger or truck tire business.

We're going to take that capability in this plant and convert it to the trailer business where we have leadership, and that's a $6 million EBIT improvement, but by the time we get the plant wrapped up, Saul, as you know, we think it's neutral the first half and it's slightly positive the second half.

But the real growth -- but most of it's a cost reduction of taking the $60 to $70 million of existing business and putting it in the plant.

That doesn't get you incremental revenue.

You'll be supplying the revenue coming out of this plant instead of purchase and resale.

Exactly, so that's why I quantified.

We're seeing on a conservative basis a $6 million EBIT improvement, and you load that on your model, it puts our tire and wheel margins back to the area that we've always thought they would be.

Now long term in '08, we think that this is a hundred million sales revenue capability and we think it's going to add some real growth.

Remember, Saul, we're selling in distribution the widest line of small specialty tires and wheels in the world, and we have these customers today.

They buy from us, and they like our service.

Quite frankly, they want us to be in these larger construction tires and ag tires.

They want us in there.

And so we've waited and been patient because we didn't want to do it without the low-cost position, so longer term '08 and '09, we're talking about well over a hundred million, which we think's going to be a very profitable business for us.

Great.

And you didn't mention anything on the call about belts.

That's been, I guess, a disappointment.

Did they make any money last year?

And what do you see happening on the belt business?

Saul, they made money, but we've articulated once again that this is another business that we've not been satisfied with.

We, I think, talked in one of the calls last year, we've changed management.

We brought in a new general manager there.

Quite frankly, he spent a long time at Gates, which is our number one competitor, and we're improving all aspects of the business.

We're expanding our China plant, so no, I -- no, the belt business, it's a lot smaller than our tire business, and doesn't have as many exciting things there, but it's the middle of a steady improvement kind of situation.

Then my final question is in your Construction Materials, you talked about two -- you have a secular decline in margins that you've talked about in the past because insulation and TPO don't have the same margins as rubber and accessories, but in addition to that secular decline in margins, you also alluded to raw material costs and rebates.

We've never heard of rebates being an issue in the past.

I wondered if you could sort of clarify the rebate comment and is that sort of one time, or is that ongoing?

And as to raw materials, have there been adjustments in pricing so that you've recovered those going into 2007?

Based on -- Saul, I'll respond on the rebate comment.

As you see, the sales increase that Construction Materials had, obviously -- they've always had rebates.

That's standard for most construction materials businesses, and the rebates are up because the sales are up, and a lot of the customers, they earned new rebate levels based on their volume, so it was expected, anticipated, and the level of rebates are always going to depend on whether or not the customers meet their target levels.

In terms of the raw materials, as Rick indicated, we do see that moderating some, and we're happy with the pricing that we currently have and how we've been able to control the raw material costs at this point.

But there must have been a reason why you mentioned rebates this time.

As I would've expected, it's normal course of the way you do business.

It was noted as a reason for degradation in margins, and that's the unusual nature of the rebate comment this time in contrast to it just being a normal course of business.

Saul, I think you've -- it's a good comment.

I mean, Carol really is putting in the release pretty much it's a management comment.

As she says, we've always had rebates.

I will say there's a couple other ingredients, one of which we had a very strong fourth quarter of '05.

If you came back to that time period you have Katrina and several hurricanes.

There was more demand than there was product.

It was an optimum pricing environment, and so we get to fourth quarter of '06 and we don't have any hurricanes, which is good, and so it's not an optimum pricing environment.

So some of this is just some comparison.

I will say, and I think I've been consistent with this, everybody -- nobody -- I said this is not a margin improvement.

Now, I will say, we've had an unusual drop in margins, and there's a lot of work going to go into that.

We still think we've got a lot of fire power here, and we can pass through these raw material increases, but this business -- we've never talked about that it was going to be a 15%, 16% EBIT business.

This is a growth business.

It's got a return on investment capital that's almost 30%, and our plans have been clear here.

We're going to grow this business.

We want to consolidate this area, and so we'll dig into the margins.

As you know, there's only two of us in the rubber membrane business.

I mean, we think we've got pricing power.

Yes, this quarter we didn't recover raw material.

Yes, there was a bad -- maybe some pricing we didn't get, but long term we still see this as a very strong business.

But I think what you're saying is that those of us that follow the Company, we should think about margins generally trending slightly lower versus where they've been, but that's not a bad thing, but it shouldn't be pointed out as if there's some problem because of margin deterioration.

I think that's a good way to summarize it, Saul.

Thank you, Rick.

Keep on trucking there.

Thank you.

There are no further questions.

Sir, you may proceed.

Well, we'd like to thank everybody for listening in and participating in our call, and we hope to get back with you here in a few months and have another call.

So with that, have a good day, and that concludes our call.

This concludes today's conference call.

You may now disconnect.