Entegris Inc (ENTG) 2013 Q1 法說會逐字稿

Good day, everyone, and welcome to the Entegris first quarter 2013 earnings release conference call. Today's conference is being recorded. At this time for opening remarks and introductions I would like to turn the call over to Mr. Steve Cantor, Vice President of Corporate Relations. Please go ahead, sir.

Good morning and thank you all for joining our call today. Earlier we announced the financial results for our first quarter ended March 30, 2013. You can access a copy of our press release on our website, entegris.com.

Before we begin I would like to remind listeners that our comments today will include some forward-looking statements. These statements involve a number of risks and uncertainties which are outlined in detail in our reports and filings with the SEC. On the call we will also refer to non-GAAP financial measures as defined by the SEC in Regulation G. You can find a reconciliation table in today's press release as well as on the website.

On the call today are Bertrand Loy, President and CEO, and Greg Graves, Chief Financial Officer. Before turning the call to Bertrand, I do want to let everyone know that Entegris will be holding an Analyst Day on June 4 in New York City. You can contact me for more information about that event. Bertrand?

Thank you, Steve. I will make some comments on the quarter's achievements, and then Greg will provide detail of the first quarter financials and on our guidance for the second quarter.

I am pleased with our operating performance for the quarter. We executed well and delivered results in line with our expectations. Our gross margin improved. We controlled our operating expenses well. We generated solid cash flow, and we continued to make good progress in our new product development.

Our first quarter sales of $165 million reflected an expected seasonally weak Q1 and a gradual start to the year. Sales in the semiconductor market represented 74% total revenue and were down 1% from Q4. Trends in the semiconductor industry were still mixed as we started the year. There were pockets of strength related to strategic technology investments by foundry customers, but this was offset by anemic demand and production levels at legacy fabs and for PC-related devices.

Sales in our non-semiconductor markets were 26% of total revenue and declined 2%. Many of our industrial markets experienced some rebound, but this was offset by continued weakness in some if not most of our emerging markets, such as solar and LED.

Over the past six months as I stepped in my new role as the CEO of Entegris, I've had the opportunity to review with many of you Entegris' new strategic priorities. These are - to invest in R&D products and technologies for advanced nodes,invest in our R&D and manufacturing infrastructure and capabilities, to make focused acquisitions, and finally, to return cash to shareholders. Let me take a moment to update you on our progress on these four priorities.

First, regarding our investment in new products and technologies, the semiconductor industry is in the midst of an unprecedented period of R&D intensity, driven by the introduction of a number of new process technologies - FinFET, double patterning, 3D and 450 millimeter wafers. We continue to work very closely with the industry's leaders in the development of the next generation processors. We made good progress with new products in advanced filtration, new solutions for CMP and EUV, new Microenvironment products for 450mm as well as new E-chucks.

Having said that, in the first quarter we did "throttle back" R&D spending somewhat as part of our cost containment measures in light of the soft industry conditions we had anticipated. However, the demands from our customers for our solutions have not slowed. As a result, you should expect that we will increase and sustain our R&D spending in Q2 as we work hard to address these new opportunities. We will, of course, continue to make future investment decisions in line with our target market.

Second, we made good progress with our investment in key technology/infrastructure capital projects. The i2M Center in Bedford, Massachusetts is on track. We expect the first phase of this project, which entails the move of our coatings and E-chuck business to the facility, to be completed by the end of the year.

As the industry's development of 450 millimeter continues to gain momentum, I am very pleased with the acceptance of our larger diameter wafer shaper and process solutions. We intend to be ready when the industry moves to the pilot production stage in 2015. As such, we are beginning the final phase of investment to prepare for volume production of our 450mm product line.

Third, in terms of our M&A strategy, earlier this month we acquired Jetalon Solutions. Our M&A strategy, as you recall, includes finding and acquiring businesses or technologies that complement our existing capabilities in the Contamination Control Solutions division or that bolster our presence in adjacent markets. Jetalon is a perfect example of this.

Although it is a small company, it brings a unique sensing and control technology to Entegris, which will help strengthen our leadership position for in-situ process metrology and sensing control in semiconductor applications as well as is in other markets such as Life sciences. I want to welcome Dr. Ron Chiarello and the rest of the Jetalon team to Entegris, and I want to recognize the Entegris team for their work in completing this transaction.

Fourth, we initiated the share repurchase plan that we announced in January. During the first quarter, we repurchased nearly 400,000 shares. As we described previously, our intent is to return excess cash to shareholders through a sustained and opportunistic share repurchase program.

Looking out to the balance of the year, I am optimistic that we will see chip production grow and that we will see improving wafer fab equipment spending as the year progresses.

Greg will now provide some details on the financials for the quarter.

Thank you, Bertrand. Good morning and thank you all for joining the call.

For the first quarter sales of $165 million were at the midpoint of our guidance and down slightly from Q4. Our non-GAAP EPS was $0.13, which included about a penny and a half of non-recurring favorable impacts from currency mark-to market-adjustments and a one-time discrete tax benefit.

Geographically, Asia sales were $71 million and grew 8% sequentially, primarily due to strength at the major foundries. Sales to Japan were $25 million and declined 14% in large part due to the weaker yen. Sales to North America were $48 million and declined 9%. Sales to Europe were $21 million, up 3%.

In terms of quarterly performance by division, sales for the Contamination Control Solutions division, or CCS, declined 6% sequentially to $104 million. The revenue decline reflects weakness in the yen and slower sales of liquid and gas filters, which declined after a record Q4. The operating margin for the CCS division was 21%, versus 20.3% in Q4. The increase was largely attributable to lower discretionary spending.

Sales for the Microenvironment division, or ME, were up 3% sequentially to $44 million, driven largely by strength in the 300 millimeter FOUP business. ME's operating margin improved to 21%, reflecting outstanding performance by ME's manufacturing operations.

Sales for Specialty Materials, or SMD, rebounded 14% to $17 million. The increase was the result of higher demand for semiconductor-related products as well as higher revenue in certain industrial markets. SMD's operating margin improved to 13% from 7% in Q4. The improvement is indicative of the operating leverage of the SMD business as revenue ramps.

Overall gross margin of 40.7% improved approximately 1 point from Q4 and was in line with our expectations. While revenue levels were slightly lower, product mix was comparable. The improved margin reflected better absorption and solid execution, particularly in Malaysia.

Operating expenses for Q1 were $47 million, which was $6 million lower than in Q4. The decrease reflects tight control of discretionary spending in both SG&A and ER&D. You may recall that Q4 OpEx included about $2.4 million of severance costs. In Q2 we expect operating expenses to be approximately $47 million to $49 million.

Our GAAP tax rate was 24% in Q1. This reflects a 28% base rate, reduced by a one-time benefit for the 2012 R&D credit which Congress had delayed in passing. For the balance of the year, we would expect the tax rate to be 28% to 30%, which is consistent with our expectations coming into the year.

Q1 EPS on a non-GAAP basis was $0.13 per share. EPS benefited from two discrete items - the R&D credit just mentioned and other income related to mark-to-market balance sheet adjustments, primarily due to the depreciating Japanese yen. These two items combined were about s penny and a half in EPS and are non-recurring in nature.

Our working capital management for the quarter was solid. DSOs were a more normal 57 days, up from 51 days in Q4. Inventory turns were 3.9 and were virtually flat compared to 4.0 in Q4.

Capital spending was $16 million, which primarily related to spending on the i2M advanced membrane and coatings facility. Both the i2M Center and our 450 millimeter manufacturing project are proceeding as planned. Depreciation expense was $7.3 million in Q1.

We spent $3.8 million and repurchased approximately 400,000 shares in the quarter as part of the $50 million share repurchase authorization. We have a trading plan in place and intend to be actively buying shares in Q2.

Cash flow from operations was $7.4 million, which was down from Q4 primarily as a result of annual variable compensation payments. We ended the quarter with $339 million in cash, which compared to $350 million in cash and short-term investments at the beginning of Q1. Decrease was due to uses of cash I just mentioned.

Before discussing our Q2 guidance, I want to highlight two key points. Even with the soft the sales levels in Q1, I am pleased with our performance during the quarter in terms of our gross margin, expense control and cash generation. Our engagement with key customers remains very strong as they develop the next generation processes. As such, we are committed to sustaining our R&D investments.

While demand trends and industry trends remain somewhat mixed, we are optimistic about an industry recovery in the second half of the year. We expect Q2 sales to be flat to up 5% or in the range of $165 million to $173 million. Given these revenue levels, we expect non-GAAP EPS to be $0.10 to $0.12 per share.

With that, we will take your questions. Operator?

Thank you. (Operator Instructions). We will take our first question from Terence Whalen from Citi. Your line is open.

Good morning, and thanks for taking the question. As we look into the June quarter revenues guidance, it's slightly below our expectation. What I wanted to understand was two things. First, the linearity of the quarter and how you saw this developing? And then second, how much of the slightly lower growth outlook for Q2 is attributable to, say, the large three spenders and customers versus the longer tail of customers? Thank you.

Terence, I will comment on Q1, and then Bertrand can comment on the outlook for Q2. But Q1 we did see it was considerably weaker in the January time frame. We saw improvement throughout the quarter. So the quarter was-Q1 was certainly not linear. It was stronger in the back half of the quarter.

Right, and, Terence, this is Bertrand. Let me just start by saying, as you know, we have fairly consistently outperformed the industry and pace of the industry for the last four years, and we certainly intend to fully participate in this current industry upturn.

Having said that, I would comment that we are right around the inflection point right now , as Greg mentioned. And remember that our business is really a turns business, so that makes it particularly hard for us to really gauge and forecast the pace of the upcoming recovery.

Having said that, again, what we are guiding towards to a flat to up 5% on the top line, and I think that takes into account the fairly significant disparity between different customers. As you know, different device makers have different expectations in terms of their revenue growth going into Q2, and that is what we tried to take into account as we were providing the guidance for Q2.

Okay, terrific. The second question that I have is, as you look at the filtration business, could you just give us an indication by segment, whether it be clean or etch or lithography, where you have seen relative strength and whether any trends specifically stand out in those areas? Thank you.

Well, Terence, we typically don't provide that level of detail, so I won't go into this for you. But, again, I think that as you well know, wet etch and clean is one of the growth areas for the industry. That is one area that we are very focused on, not only for the liquid filtration products, but also for a number of sensing and control and component assistant products.

And litho would be coming next in terms of our strategic focus. So I think that those process areas will be -- those two process areas will be the two area of focus for the Entegris team going into 2013.

Thank you. That's helpful. I'll requeue, thanks.

The next question is from with Krish Sankar with Bank of America Merrill Lynch.

Hi, this is Thomas Yeh calling in for Krish Sankar. Thanks for taking my questions. Can you provide us the details between unit driven versus CapEx driven sales this quarter and your expectations for both that is baked into your guidance?

For the quarter it was about -- unit driven business was 66.5%. CapEx driven was 33.5%. And as it relates to the outlook, Bertrand, did you want to comment on that?

I think I would expect actually the CapEx to benefit from increased wafer fab equipment spending in Q2, so I could see actually a scenario where unit driven could be slightly less in Q2 versus Q1. Having said that, again, it is going to be a very marginal change.

Thanks. That's very helpful. Based on the guidance for revenue to be flat to up slightly in Q2, I just want to get a better sense of the reason EPS is coming down? You mentioned $0.015 nonrecurring benefits in 1Q. I just wanted to get the expectations around product mix and quarterly expense levels moving forward?

Sure The decline in EPS really is related specifically to those discrete items. If you look at them and you say we were at $0.13 in the current quarter and had $0.015 or a little bit more of discrete items, we would have been at $0.11, which is right in the middle of our guidance. So on flat revenue, comparable EPS.

What I would say is, regardless of the scenario, we would expect to be in line with our target model. Our target model at $170 million in revenue is for operating margins of 13% to 15%. We talked about, in terms of more granularity around the P&L, we talked about OpEx of $47 million to $49 million in the quarter.

I didn't comment is specifically on the gross margin, but I would expect to see some incremental improvement in the gross margin as we move into Q2, driven really by continued improvement in absorption and what we expect to be slightly better mix.

Thanks. And then just a final one from me. Can you talk a little bit about what you are seeing in the competitive landscape? Taiwanese wafer shipper company named Gudeng Precision has experienced pretty significant growth over the last few years, and I wanted to get a sense of if you are seeing any impact on share or pricing. Thanks.

We are actually seeing -- if you think about ME specifically, which I think is what your question is about, we continue to see our I would say traditional wafer handling competitors, but we are also noticing the entry of a couple of new Asian competitors.

Having said that, I would really encourage you to check your facts and your sources. I think that it is true that the one Taiwanese competitor that you're mentioning is getting a lot of publicity, but if you look at the market share that they have been able to gain, I would say that their gains have been relatively modest. And I'm basing this comment both on the 300 millimeter platform as well as, more importantly, on the 450 millimeter platform.

Thank you.

And we will take the next question from Patrick Ho with Stifel.

Thank you very much. Bertrand, maybe if you could give a little color in terms of the units-based business based on the commentary you just highlighted. Do you believe that some of the chip makers that you obviously work with are still working through some of their inventory and that it will take another spike up in utilization rates on their end before they pick up their pace with you guys? I guess, what is the disconnect between some of the growth that we are seeing, say, at a TSM and some of the other foundries versus what you are seeing right now?

Patrick, I would just say that, again -- and I think your question is around Q2. As we get into Q2 we do expect some improvement in terms of fab capacity utilization, but I would say that we will remain probably relatively low for the legacy nodes. And again, as you well know, the fab capacity utilization will be very different from one customer to the next.

Having said that, we also -- as you pointed out, we believe that there is still some level of inventory for liquid filter products in particular in the channels that some of our customers needed to work through in Q1. We don't have perfect visibility to that, so -- but I think that this should be working off those inventory as we get into early Q2.

Okay, great. Maybe a question for Greg. You mentioned that you expect to see some improvement in gross margin heading into 2Q. You also mentioned previously in the past that you expect some headwinds as you build out and ramp the i2M facility. Give us an update on the moving pieces and how we can look at the gross margin line, not only in the June quarter but over the next couple of quarters as you ramp up that facility?

So -- I mean the gross margin line is obviously heavily dependent on volume, so it's a little difficult to talk about Q3 and Q4 at this point. As it relates to the current quarter, we would expect to see slightly better mix in the quarter, slightly better absorption and continued strong manufacturing performance. So that's what gives me confidence that we will see some incremental improvement in Q2.

As it relates to Q3 and Q4, we talked in Q1 really about having about $2.5 million to $3 million of costs in the back half of the year related to the migration into that new facility here in Burlington. And that is still our perspective on that. If it you split that evenly between the two quarters, it could be between three quarters and a point of margin in Q3 and Q4.

Great. Thanks a lot, guys.

And we will take our next question from Jason Ursaner with CJS Securities.

Good morning. First I would like to concentrate on the semiconductor market at a high level. There is a lot going on in the industry, and, Bertrand, you mentioned that it really is an unprecedented period of R&D right now. So as an outsider one of the best parts of your business is that you are semiconductor indifferent. They all use your products, and you are a largely tied-to-unit production.

So the question I would like to ask is as you look forward is there really a best scenario for Entegris? Are certain ones better or worse if techniques are achieved or not achieved, whether it's double patterning, FinFET, EUV? Is there really is best for you, or is this uncertainty of finding the next solution the best for Entegris?

Again, before I thought start going into some of the granular answers, let me just at high level again frame some of the major drivers for our products, and that would be the number of process steps required to make a chip and the amount of chemicals being used to produce the chip.

So as we actually see the industry going down the industry road map and shrinking from one node to the next, we are seeing more process steps being introduced, and those process steps are contending with more complex contamination challenges. All of that actually bodes well for the demand of our products. Again, contamination control becoming particularly critical to yield improvement and time to yield to our customer.

So I would say that FinFET is definitely introducing a number of interesting contamination challenges, so we like the complexity of this particular process technology. Multiple patterning means more process steps being introduced, so obviously that drives chemical usage and that drives usage of our filters, so we like that.

So EUV could potentially be viewed as risk, but I would just point to the fact that EUV really is allowing us to develop a number of radically new solutions around the light source and the light path. So things that -- or products and solutions that were not required in standard immersion lithography. So I think on balance I think that all of those new process technologies are presenting some positive opportunities for us.

Okay. And in the microenvironment segment, you continue to generate stronger operating margin there. Is this a natural transition because of your share and IP at the 300 FOUP level? Or are you gaining back any of the share you missed in the shippers at 300? Or is this really more of the legacy products where maybe you aren't seeing degradation in price at this point?

I would say it is a function of our strong market position of 300 millimeter where we continue to do very well with the FOUP product line and continue to win -- consistently win. And it is also a function of manufacturing performance, as I said in the script, particularly in Malaysia where we have really seen a marked change in those operations over the last 12 to 18 months.

Okay. And just last question, staying in the microenvironment segment. On 450mm, you got a question before on a competitor. How much of the IP at 450 do you think is fully set at this point for what is going to end up being in the FOUP, and generally where do you think you stand in that standards setting?

That is a great question, Jason, and thank you for asking. I would say that a lot of the IP has been set and developed. Entegris actually has a very rich portfolio of IP around 450mm, and I would tell you that most of our competitors actually will need to secure licensing agreements with Entegris in order to practice the 450mm technology. And actually most of those licensing agreements are (inaudible) --

I couldn't hear the last part, sorry.

I said that most of the licensing agreements are in place today.

Okay, great. Appreciate all the details. Thanks.

And we will take our next question from Jairam Nathan with Sidoti.

Hi, guys. Thanks for taking my question. Just on the Contamination Control segment sequential decline of 6%, you mentioned a filtration component as one of the reasons. Is -- as the yields of the 28 nanometer has kind of improved, does that imply that the intensity of use kind of comes down with our customers? And is that one of the reasons why you could kind of -- behind of decline?

That is one of the many factors. I think you are right that typically when a fab customer ramps up production of a new node, the yield challenges are daunting, and as a result consumption of our products usually tend to increase or to spike up. And then once the solutions and the process recipes are more stable then you reach a more normal level.

So you are absolutely right that we did see that actually when some of our customers built up the 28 and 22 nanometer nodes. I would expect to see benefit as some of those customers start getting ready for the 20 and 14 nodes later on this year.

Okay, thanks. And Greg, on the gross margin just wanted to kind of follow-up on -- you indicated the 75 to 100 basis point pressure from the i2M in the second half. But at the same time your volumes probably hopefully should go up. So how you should we think about gross margins on a year-over-year basis, 2012 versus 2013, in the sense that you had a pretty -- the fourth quarter of 2012 kind of brought down your average for last year?

Well, I guess, Jairam, I think it really depends on what kind of volumes we are operating at as we get out into Q3 and Q4. I mean, if we are operating at volumes in Q3 of 2013 like we were operating in Q3 of 2012, I think you could expect to see a similar margin profile less the impact of that manufacturing transition. So if you look at Q3 of 2012, we were at about 44%. If we are running at that kind of revenue level, I don't think that would be an unreasonable expectation, minus the point for the transition.

Okay. That's helpful. Thanks a lot.

(Operator Instructions). And we will take our next question from Steve Schwartz with First Analysis.

Good morning, guys.

Good morning, Steve.

In the prepared remarks you talked about 450mm adoption picking up in 2015. So I'm just wondering what you expect the contribution to revenue might be in 2014 versus 2013? Can you give us some idea of what that ramp might look like for you?

Well, I think that -- we had a similar question during the last call, and my answer then will be the same answer we give you today, which is that revenue for the ME division will remain -- revenue coming from the 450 millimeter product lines for the ME division will probably represent around 1% of the revenue this year and probably for most of next year. And as we start getting into pilot production mode I think we could see some increase to probably closer to 5% of the ME division revenues. And I would expect that those levels probably would be relatively stable for a year or two until we see some further adoption of 450 millimeter by other industry participants.

Sure, sure. Okay. Well, no, that is very helpful then. Greg, you talked a little bit about the manufacturing improvement in Malaysia, and I'm just wondering to what extent are there transition efficiencies left to work through, if there are any? And -- or how much improvement you could continue to see out of that facility?

Today I don't expect to see any marked change in kind of our margin profile or our manufacturing operations over the next six to 12 months other than this transition into the new facility here in New England. We do have a number of product transitions that have taken place or are taking place today that are putting some drag on the gross margin, but it is not -- at this point it is not material. So I really wouldn't see a lot of change over the next 12 months.

Okay. And then just as a last question you mentioned that the share of revenue from the semiconductor market dropped by a percentage point sequentially. Is that simply because of the improvement in specialty materials and industrial, or is it non-semiconductor electronics applications where you saw an improvement?

So in the portion that really improved the most in Q1 was really the industrial markets in the SMD division. And that actually was offset by pretty consistent across-the-board decline in most of the other non-semi markets such as solar, LED, display or data storage.

Okay. Very good. Thanks for taking the questions.

And we will take our next question from Dick Ryan with Dougherty & Company.

Thank you. Hey, Greg, I may have missed the number, but did you give -- I know you gave CapEx for Q1, but did you provide CapEx for the remainder of the year?

We are still holding with the view that CapEx will be approximately $70 million for the year.

Okay. How should that be split front-end, back-end?

Well, so we've spent $16 million in Q1. I would expect it will be relatively evenly split over the next three quarters. And we will finish out the i2M center. We will have some additional spending related to 450 millimeter after taking a little pause on that over the past couple quarters.

Okay. In the non-semi space you talked about weakness, solar, LED. Can you address what your expectations are there, Bertrand?

Going into Q2 I would expect some level of improvement across most of those markets, but again, in our projections we are anticipating a growth rate in the low single digits for those markets.

Okay.

And looking again, Q2 over Q1.

Okay. And Greg, customer concentration - I know it started moving more towards the top three representing I think 20% of sales. How is that -- how did that shape up in Q1?

That really hasn't trended any differently. It would probably be a little bit less than it was in Q4, but the overall trend has not changed significantly.

Okay. Thank you.

And we will take a follow-up question from Terence Whalen with Citi.

Thank you. The follow-up question I have is regarding Jetalon. I may have missed this, but what was the financial consideration and what is the financial impact of that acquisition on 2Q results? Thanks.

We paid a little over $13 million upfront for the transaction, and there is an earn-out structure involved, so we could have additional consideration over the next two to three years. From an impact on our revenue and P&L through the balance of the year, it is really not material in either case, and the revenue will be modest and there is also no drag on the P&L either.

Great. My second follow-up was regarding looking at the 450mm shipper market. Just wanted to hear any insights you had with regard to prospects to gain share back there and also understand what you think is driving your ability to perhaps regain share in the shipper market specifically? Thanks.

Well, Terence, as you know -- as you well know, 450 millimeter for us is actually a very significant opportunity indeed. We set our market share expectations for our shipper product lines. We have been working very aggressively towards that goal.

We are very pleased with the results - the feedback we are getting from our customers, and I would say that, as you know, there are only a limited number of industry participants that are very active on 450 right now, but the all feedback we are getting would suggest that we have a very solid overall solution that is well endorsed by the industry right now. So I like the competitive -- in other words, I like the competitive position we are in at this point.

Having said that, it is -- if you indulge this [popizon], I would say it is like the Tour de France. It is -- I think we have won a number of stages. We probably even won the two mountain stages. We have a good team, but we really want to win the race, and I think that is really what we are focused on.

Appreciate the thoughts and best of luck. Thanks.

And we will take our next question from Christian Schwab with Craig-Hallum Capital Group.

Thanks for taking the question. Bertrand, you said earlier in the conference call you were optimistic for the remainder of the year. Can you walk through or help us understand that optimism for the second half of the year and maybe give us some bands on what you expect wafer fab utilization to improve or wafer starts to improve? And maybe a disproportionate share of CapEx spend in the second half of the year versus the first half?

Christian, I would just say that right now most macroeconomic projections are pointing to more optimistic scenarios for 2013 than they were six months ago. So as you know there is a strong correlation between global GDP and electronic devices. So that is, I would say, the basis for our confidence.

The other reason on the CapEx front is that all of the major industry participants have come up with fairly strong CapEx numbers for the year, and as of today they all seem to be sticking with those numbers, which again, at this very moment would suggest that there could be some positive momentum for the year as we see some more CapEx coming from logic and memory customers. Having said that, we are in a volatile environment, a volatile industry and a volatile microeconomic environment, and I would refrain from quantifying my expectation on the full year basis. Just simply don't have enough visibility at this point in time.

That's fair. As it relates to the unit-driven business and in particular the movement to the 2X node and below, what should we be assuming your growth rate at constant market share should be above wafer starts?

Christian, could you repeat that question or reformulate that question?

Yes, let me reformulate it. If wafer starts grow 7% this year, then your unit business should grow how much better than 7%?

So, again, our objective is to be around 300 basis points above the overall industry growth. That is what we have been delivering for the last three to four years, and that is our goal going forward. So that would be the answer I would give you.

Great. Thank you.

And that does conclude today's question and answer session. At this time I would like to turn it over to Mr. Bertrand Loy. Please go ahead, sir.

Thank you all for joining the Entegris call today. We look forward to seeing hopefully many of you in New York on June 4. With that, Mary, please go ahead and conclude the call.

And that does conclude today's conference. Thank you for your participation.

Thank you very much.