Euroseas Ltd (ESEA) 2024 Q1 法說會逐字稿

Thank you for standing by, ladies and gentlemen, and welcome to Euroseas conference call on the first-quarter 2024 financial results. We have with us Mr. Aristides Pittas, Chairman and Chief Executive Officer; and Mr. Tasos Aslidis, Chief Financial Officer of the company. (Operator Instructions)

I must advise you that this conference call is being recorded today. Please be reminded that the company announced the results for the press release that has been publicly distributed.

Before passing the floor to Mr. Pittas, I would like to remind everyone that in today's presentation and conference call, Euroseas will be making forward-looking statements. These statements are within the meaning of the Federal Securities Laws. Matters discussed may be forward-looking statements, which are based on current management expectations that involve risks and uncertainties that may result in such expectations not being realized.

I kindly draw your attention to slide number 2 of the webcast presentation, which has the full forward-looking statements, and the same statement was also included in the press release. Please take a moment to go through the whole statement and read it.

And now, I would like to pass the floor to Mr. Pittas. Please go ahead, sir.

Good morning, ladies and gentlemen, and thank you all for joining us today for our scheduled conference call. Together with me Tasos Aslidis, our Chief Financial Officer. The purpose of today's call is to discuss our financial results for the three-month period ended March 31, 2024.

Let's turn to slide 3 of the presentation to go over our income statement highlights. For the first quarter of 2024, we reported total net revenues of $46.7 million and the net income of $20 million or $2.87 per diluted share.

Adjusted net income for the quarter was $18.5 million or $2.66 per diluted share. Adjusted EBITDA for the period was $24.6 million. A reconciliation of the adjusted net income and adjusted EBITDA to net income is shown in the press release. Our CFO, Tasos, will go over our financial highlights in more detail later on in the presentation.

As part of the company's common stock dividend plan, our Board of Directors declared again a quarterly dividend of $0.60 per common share for the first quarter of 2024, which will be payable on or about June 21, 2024, to shareholders of record on June 14. The annualized dividend yield based on the current share price is again above 6%. This is the ninth consecutive quarter of paying meaningful dividends.

As of May 23, 2024, we had also repurchased 400,705 of our common stock in the open market for a total of about $8.2 million since the initiation of our share repurchase plan of up to $20 million, which was announced in May 2022. We will continue to use our share repurchase program with management's discretion depending on our stock price to enhance our ability to drive long-term shareholder value.

Please turn to slide 4, where we discuss our recent sales and purchases, newbuilding, chartering and operational developments. On the S&P front, we have agreed to sell motor vessel Astoria, a 2,800 TEU feeder container ship vessel built in 2004 for approximately $10 million to an affiliated party.

The sale capitalizes on the current strong asset prices, and we will log a significant profit next quarter when the deal closes. The vessel is expected to be delivered to the new owners by mid June 2024. The delivery of our fourth newbuilding vessel from the series of nine took place on April 25.

Motor vessel Leonidas Z, a new newbuilding fuel-efficient 2,800 TEU feeder container ship, was chartered to Hapag-Lloyd, one of the largest liner companies for a period of about two years at a daily rate of $20,000 a day. This charter is expected to contribute about $9 million of EBITDA for the contracted period and increases our 2024 charter coverage to about 88%.

Moreover, the delivery of the fifth vessel took place on May 13 when motor vessel Monica, a fuel-efficient 1,800 TEU feeder vessel, was chartered for a minimum period of 10 to a maximum period of 12 months at the option of the charter at a daily rate of $16,000 per day.

Continuing on the charter side, our Aegean Express, our smallest and oldest vessel, was fixed for a minimum period of seven to nine months at $8,000 a day starting from March 23 after three days wait. While motor vessel Synergy Antwerp was fixed for a minimum of 11.5 months to maximum of 14 months at $26,500 per day starting immediately upon delivery from the shipyard where it underwent its normal drydocks and retrofit, and this new charter start from April 2, 2024.

Finally, motor vessel Joanna was just extended for a minimum of two to maximum of three months with current charters at $13,500 per day. Regarding dry dockings, our motor vessel Synergy Oakland underwent its scheduled special survey for approximately 18 days.

Our motor vessel Marcos successfully completed its scheduled 31-day drydock, which included the retrofits worth about $1.8 million. As in the case of the recent retrofit of motor vessel Synergy Busan, we cooperated closely with the charterer to fund the modifications of the vessel and share the economic benefits from the improved performance.

The charter is contemporaneously declared the option to extend the charter by an additional minimum seven months until August 2025. The other retrofits resulted in an improvement of her consumption in the commencement speed the range by about 25%.

As per our agreement with the charterer, if the vessel is employed after the current charter period, then the owners will refund part of the cost to the charterer up to a maximum of 50%. The motor vessel Synergy Antwerp, as I said, also successfully completed a scheduled 30-day drydock. As part of our efforts to minimize our carbon food footprint, she too underwent $1.25 million of retrofit.

Next, please turn to slide 5 for an update on our current fleet profile. Our current fleet is comprised now of 22 vessels in the water. The 15 feeder containerships and seven intermediate container carriers, with a total carrying capacity of just under 66,500 TEU and an average age of 15 years rated by TEU.

Turn to slide 6. Here, we shown our four remaining vessels under construction with deliveries expected throughout 2024. The four newbuildings have a total carrying capacity of 9,200 TEU and they include two 2,800 TEU vessels and two 1,800 TEU vessels. After the delivery of its four remaining feeder containership newbuildings in 2024, Euroseas fleet will consist of 26 vessels with a total carrying capacity of about 75,000 TEU.

Let's now turn to slide 7 to see the vessel employment graphically. As you may see, we have a very strong charter coverage throughout the next two years with about 88% of our fleet being fixed for 2024 and about 32% for 2025. Our significant charter coverage and profitable rates for the remainder of the year suggests highly profitable growth that will further enhance our fleet liquidity throughout 2024 and 2025.

Let's turn slide 9 for a broader market review, starting with the development of the 6- to 12- month time charter rates over the last 10 years. During the first quarter and extending into mid-May 2024, containership charter rates have shown a robust recovery serving significantly from the low levels at the start of the year across all segments.

As of May 17, 2024, the 6- to 12-month charter rate for the 2,500 TEU containership stood at $19,500 per day, which is higher than the historical median of $9,200 per day, about double, and well supported when compared also with a 10-year average of about $15,500 per day. The comparisons to medium and average rates are similar across the smaller and larger container sizes as well.

Moving on to slide 10, we go over some further market highlights. As mentioned, one year time charter rates improved across all segments in the first quarter and charter rates have increased by approximately 73% today since the low as of December 21, 2023.

The current increase is mainly attributed to the tensions in the Red Sea and consequent to diversions. The full impact of rerouting is yet to be seen though as regional geopolitical issues are still evolving. As said before, charter rates since the end of the year have increased by over 70%.

Average daily rates increased by 26% over the average of Q4 2023 during the first quarter of 2024. And that can be seen in the table below across all container segments. The vast increase in rates during May 2024 is primarily due to the routing from the Red Sea.

The average secondhand price index showed an increase of about 11% during the first quarter of 2024 compared to the fourth quarter of 2023. Oil prices, of course, continue to lag significantly behind the peak levels seen in 2022; they are above the average levels observed before the COVID-19 pandemic.

The newbuilding price index increased by about 7% in the first quarter compared to the previous quarter. Newbuilding prices continue to stay elevated due to cost inflation and extended yard [forward cover].

Although there has been some easing in newbuild contracting from the exceptionally high levels witnessed during COVID-19, it remains relatively firm amid continued appetite from liner companies with excess cash, renewing the fleets with alternative fuel vessels.

As of May 6, 2024, the idle fleet excluding vessels under repair stands at just 190,000 TEU, accounting for 0.7% of the total fleet. This marks a decline from its peak of about 800,000 TEU just one year ago with the downward trend observed since then.

In 2024, up to now, 23 vessels accounting for 33,000 TEU have been scrapped. We expect demolition activity to increase slightly in the remainder of 2024 after a number of quieter years due to -- which were due to the higher charter rates. Although, the current political disruptions may continue to limit scrapping at the end.

In the first quarter of 2024, scrapping prices softened slightly to approximately $540 per lightweight ton, remaining the above the average observed in 2019 by about 30%. Overall, the fleet continues to grow, having expanded by about 4% year to date without accounting, of course, for idle vessels reactivation.

Please turn to slide 11. The IMF's latest update from April 2024 projects that the global economy will see another year of slow yet steady growth, raising the forecast from 3.1% to 3.2% in 2024. This growth rate is expected to continue into 2025. This is largely due to a sizable improvement in the economic outlook for the United States, offset by a more modest slowdown in emerging and developing economies.

The forecast for the next five years is at its lowest in decades at 3.1%. The global economy has been surprisingly resilient despite significant Central Bank interest rate hikes to restore price stability. Indeed, global inflation is declining steadily and is projected to low from 6.8% in 2023 to 5.9% in 2024 and 4.5% in 2025 with the advanced economies returning to their inflation targets sooner than emerging markets in developing economies.

We now anticipate that the three Federal Reserve rate cuts that were projected by the end of 2024 will be reduced to two or more due to this persistent inflation. During this quarter, the IMF upgraded significantly last year's 2024 growth forecast to 3.2% from the 2.6% projected in January 2024 due to the continued strong oil exports, amid higher global oil prices, despite the price cap mechanism imposed by Western countries as well as due to strong government spending and investments related to more production along with higher consumer spending in the tight labor market. The IMF also upgraded last year's 2025 growth forecast to 1.8% from 1.1%. It seems that the Western sanctions are not working.

For shipping, we continue to monitor China's economy closely, which is relative to the path struggling by the enduring downturn in this property sector. The Chinese economy is forecast to grow by just 4.6% in 2024 and 4.1% in 2025. China's economic growth may further intensify due to trade tensions in an already weakened geopolitical environment. And therefore, stability may take even longer to be restored.

On a more positive note though, growth in India is projected to remain strong at 6.8% in 2024 and 6.5% in 2025, with robustness reflecting strong domestic demand and the rising working age population. Similarly, the ASEAN-5 economies are expected to grow quite strongly, thus assisting shipping.

According to Clarksons forecast, containership trade demand is expected to significantly increase from the 5.5%, which was previous projections to 9.2% now. However, a decrease of 2.4% in trade demand is now projected through 2025. These latest forecasts assume about half a year more of disruption to container trade due to the sea rerouting, uplifting TEU mile demand to about 11% currently and 5% overall for the full year.

Panama Canal impacts are less severe, but demand estimates have allowed for some additional transpacific trade volumes being shipped to the US West Coast rather than the East Coast, given the restrictions in the Panama Canal transits. This should generally grow a much smaller impact than the Red Sea disruption. And of course, a longer than assumed crisis in the Red Sea will likely result in significant higher demand growth.

Please turn to slide 12, where you can see the total fleet age profile and containership of the group. The containership fleet is relatively young with most vessels under 15 years old and only 10% of the fleet over 20 years old. The largest percentage of which though lies within feeder vessels, suggesting high potential recycling for this type of ship. As of April 24, 2024, the order book as a percentage of fleet stands at around 21%, reduced from close to 30%, which we saw last year.

Turning on to slide 13. We also go over the fleet age profile and order book for ships in the 1,000 to 3,000 TEU range. These type of vessels are the backbone of our operations and the primary focus of our newbuilding program. The order book here stands at 6.8% as of May 24, 2024.

According to Clarksons, new deliveries are projected to be approximately 8% this year, 1.9% in 2025, and 0.7% in 2026 and beyond. Suggesting that after 2024, we will have a minimum of deliveries in 2025 and 2026. With over 50% of the fleet being over 15 years old, these favorable fundamentals suggest an anticipated reduction in fleet size in the coming years.

Let's move to slide 14, where we discuss our outlook summary for the containership market. The container shipping markets have significantly strengthened since last December due to the routing of vessels away from the Red Sea and the Gulf of Aden.

The rerouting has had a substantial impact from the supply demand balance as most vessels are affected on East-West services are now taking longer alternative route. Consequently, demand for ships has increased boosting fleet utilization by more than 10%. Freight rates have served, and charter rates have significantly risen and continue to climb, indicating a halt to the previous softening trend, at least for now.

The Contex index has increased by 73% since December '23. For the remainder of 2024, we anticipate a strong market to continue until geopolitical issues ease. However, the substantial new vessel supply is expected to gradually take over and lead to lower rates.

Despite this, the potential risk of a full closure of the Strait of Hormuz, although it has minimal impact on containers and the ongoing disruption in the Suez Canal and the Red Sea, continue to affect vessel activity in the shipping markets.

The Red Sea security crisis shows no signs of resolution, and the Israel/Iran crisis could further exacerbate the situation. If geopolitical tensions ease, we anticipate the softening in container freight and charter markets driven by the accelerated capacity growth. Conversely, if these tensions persist, the extended period of vessel rerouting would support higher charter rates.

Looking ahead 2025, if geopolitical issues are resolved, supply and demand fundamentals would likely lead to softening of the market. The extent of this softening will depend on the development of the geopolitical situation. But if conditions normalize, the significant fleet expansion could result in a substantial decline.

In any event, market conditions remain challenging. Market performance will be sensitive to capacity management, vessel speeds and various inefficiencies such as congestion that could alleviate some of the pressure.

Also, the energy transition has continued to gain momentum in the containership sector. Whilst it is evident that the shift is taking place, the long-term outcome remains uncertain. One thing is sure though, the spread between charter rates achieved by eco vessels will increase further, the charterers become more sensitive to giving the transport options.

Let's move to slide 15. The left chart shows the evolution of one-year time charter rates to containers with a capacity of 2,500 TEU since 2015. One-year time charter rates are far below their peak in early '22, but as previously mentioned, have earned back lost ground to stand at $19,500 per day, above historical average and median rates.

The right-hand chart illustrates the historical range for new build and 10-year-old secondhand containerships with a capacity of 2,500. Recent data shows a rebound from year-end prices with values to remain significantly higher than both at historical levels and medium levels.

Newbuilding prices for containers of this size currently stands at $41.25 million, whilst historical level and median price for new buildings of this size for the last 10 years is $33.7 million and $31.5 million, respectively.

For the 10-year-old secondhand vessels of this size, prices currently stand at around $23 million, while their respective historical average and median prices are approximately $17 million and $13 million, respectively. Given these persistent elevated prices, we are hesitant to pursue further acquisitions unless they can be paired with charters that will reduce residual values of expiration to below the historical median.

And with that, I'll pass the floor to our CFO, Tasos, to go over our financial highlights in further details.

Thank you very much, Aristides. Good morning from me as well, ladies and gentlemen. Over the next four slides, I will give you an overview of our financial highlights for the first quarter of 2024 and compare those results to the same period of last year.

For that, let's turn to slide 17. For the first quarter of 2024, the company reported total net revenues of $46.7 million, representing an 11% increase over total net revenues of $41.9 million during the first quarter of 2023. We reported a net income for the period of $20 million as compared to a net income of $28.8 million for the first quarter of last year.

Interest and other financing costs for the first quarter of 2024 amounted to $3.2 million as compared to interest and other financing costs of $2 million for the same period of 2023. This increase is due to the increased amount of debt we carry and an increase in the softer rate of our bank rates in the current period as compared to the same period of last year.

In the first quarter of 2024, our interest figures are used by the capitalized imputed interest of $1.4 million due to the self-financing of the pre-delivery payments for our newbuilding program as compared to $1.1 million of [interest] during the same period of last year. Finally, interest income in the first quarter of this year amounted to $0.55 million compared to $0.23 million for the same period of 2023.

Adjusted EBITDA for the first quarter of 2024 was $24.6 million compared to $26 million achieved in the same period of last year. Basic and diluted earnings per share for the first quarter of this year were [$2.89] and $2.87, respectively, calculated on approximately 6.9 million basic and 7 million diluted weighted average number of shares outstanding compared to basic and diluted earnings per share of $4.11 and $4.10 for the first quarter of 2023, calculated in term on approximately 7 million basic and diluted to weighted average number of shares outstanding.

Excluding the effect from the income for the quarter of the unrealized losses or gains on derivatives, the amortization of below market time charters acquired, the depreciation charged due to the increased value of assets acquired with below market time charters, and for the first quarter of 2023, the gain on sale of a vessel, the adjusted earnings per share for the quarter ended March 31, 2024, would have been $2.67 and $2.66 per share, basic and diluted, respectively, compared to adjusted earnings of [$3.10] and [$3.09] per share basic and diluted, respectively for the first quarter of 2023. Usually, security analyst does not include the above items in the published estimates of earnings per share.

I would like to mention here that during the first quarter of 2024, we have three drydockings, two of which included, as Aristides mentioned, our retrofits in order to improve the carbon footprint and future earning capacity of the vessels, that these drydocks resulted in increased drydocking expenses for the period and loss of proportionately more trading days as compared to the first quarter of last year for the previous quarter. This investment will (inaudible) earnings per share this quarter but will be reversed in subsequent periods.

Let's now move to slide 18 to review our fleet performance. We will start our review by first examining the utilization rates during the first quarter of this year as compared to the previous year. As usual, our fleet utilization rate is broken down into commercial and operational.

During the first quarter of 2024, our commercial utilization rate was 99.8%, while our operational utilization rate was 99.9% compared to 98.1% commercial and 97.6% operational for the first quarter of last year.

On average, 19.6 vessels were owned and operated during the first quarter of 2024, adding another time charter equivalent rate of $27,806 per vessel compared to 17.1 vessels in the same period of 2023, selling on average to $29,231 per day.

Our total daily operating expenses, including management fees, G&A expenses, but excluding drydocking costs was $7,963 per vessel per day for the first quarter of this year compared to $8,074 per vessel per day for the first quarter of 2023.

If we include our interest expenses, drydocking expenses and loan repayments, our cash flow breakeven rate a day during the first quarter of 2024 was $17,171 per day versus $14,160 during the first quarter of last year. The difference being due, as I mentioned earlier, to the increased drydocking expenses during the quarter.

Finally, if we look at the very last line of the slide, we can see the common dividend expressed in dollars per day per vessel that we paid in the two periods. For the first quarter of 2024, that amounted to about $2,328 per vessel per day. While for the same period of last year, it amounted to $2,271 per vessel per day.

Let's now move to slide 19 to review our debt profile and our forward cash flow breakeven level. As of March 31, 2024, our total debt amounted to approximately $148.6 million. The chart at the right of the -- top left of the slide, displays our current debt repayment schedule for the next four years.

As you can see in 2024, we made loan repayments totaling $9.4 million in the first quarter of this year, and we expect to make an additional $25.7 million in the remaining of the year for a total of about $35 million. In 2025, our projected loan payments are around $19.9 million, along a balloon payments of $17.6 million.

While in 2026, our loan repayments are expected to amount to about $13 million with no balloon payments due. Please note that these figures include repayments from the two loans we do in the second quarter of 2024 to partly finance the acquisition of our recent [levers], Leonidas Z and Monica from our new building program.

They do not include repayment for approximately another $100 million of debt. We expect to assume to partly finance the next four remaining newbuildings from our newbuilding program.

A few words now regarding the cost of our debt as of the end of the last quarter. The average margin was 2.29%. And assuming a SOFR rate of around 5.31%, the cost of our senior debt as of March 31 was approximately 7.6%.

If we further include the savings from certain interest rate swaps we have for a portion of our debt, the overall cost of our debt is reduced to about 7.34%, that's approximately 13% of our debt hedged a base of rate of around 3.4%.

I would like to draw your attention now to the bottom of the slide where we present the level and components of our expected cash flow breakeven for the next 12 months and show values cash flow breakeven levels.

First, our EBITDA breakeven level is $7,645 per vessel per day. If we are to add interest expenses and loan repayments, our overall projected breakeven level over the next 12 months is expected to be around $13,653 per vessel per day.

We'll sum up now our presentation of the financial figures by moving in the next slide, slide 20, to review some highlights from our balance sheet. Our assets may include cash and other current assets, advances for vessels under construction, and of course, our vessels in the water and their book value.

As of March 31, 2024, we had cash and other current assets amounting to about $70.2 million, advances that we paid for our newbuilding program of about $87.7 million and investments with a book value of around $308 million, resulting in a total book value for our assets of about $466 million.

On the liability side, our debt, as I mentioned, as of March 31 to $148.6 million, which represents approximately 32% of the book value of our assets, which had also other liabilities like the fair value of our below market acquired charters represented about 1.4% of our assets and other liabilities totaling about $20.4 million or $4.4 million for total assets, resulting in a net book value for our shareholders of about $291 million or about $41 per share.

However, I think it's important to highlight here that the market value of our fleet significantly exceeds its book value. We estimate that the charter adjusted value of our fleet to be in the range of [$390 million to $395 million], which translates to a net asset value for the company of [$385 million to $390 million] or around $54 to $55 per share.

Our closing price yesterday was just under $37, at a significant discount to our NAV and thus presenting a considerable appreciation potential for our shareholders and investors.

With that, I'd like to turn the floor back to Aristides to continue the call.

Thank you, Tasos. Let us now open up the floor for any questions.

(Operator Instructions) Tate Sullivan, Maxim Group.

Thank you, good day. Starting with the cash commitments for the newbuilds yet to be delivered and the two that were already delivered this quarter. You said you're adding $100 million, I think I heard in debt to finance those newbuilds. What are the remaining newbuild commitments for the payments schedule? Tasos.

The remaining -- I think, I can make a quick estimate. I believe we have paid about $87 million before -- I think it would be roughly about $20 million. I can get you a more exact number, but I think you asked me about $20 million would be the equity commitments.

Okay. So total $120 million. Okay, thank you. And then for the contracting the newbuilds and then (inaudible), you contracted the Monica already for $16,000. And then can you talk about the stuff [in your rate], what do you still expect to get that before the end of the quarter? Should we expect a similar new build rate or if you could decide for longer term, could it be lower than that $16,000 daily rates?

I think that we will be able to fix something which is very similar to this level. We would like to fix around a years' time. We will see. We are talking with some charterers, and we will know relatively soon.

And just logistic, we start to get paid on the contracts for newbuilds rate when they exit -- upon exiting the shipyard (multiple speakers)

Correct.

And, Tasos, to the financing for the newbuilds that you receive, will you secure the financing upon delivery? Or do you get financing for the installment payments for the remaining? How do you manage that?

So we finance -- we pay installment payments ourselves and we arrange delivery financing. Usually, we are in the financing of the vessels that delivery in model forward or more in advance. For example, the next two vessels that we expect to take delivery of are already financed as we announced already. The last two, we haven't completed our financing arrangements yet.

Excellent. Thank you very much.

(Operator Instructions) Kristoffer Skeie, Arctic Securities.

Thank you for taking my questions. I was wondering if you could provide some color -- more color on the ongoing thoughtful discussion (technical difficulty) '25, 2026. Are you seeing a lot of interest for forward fixing by liners? It was about half the duration on these discussions changed in recent months. Are you seeing a site or a longer charters or spot rate has bounced back?

We currently don't have many ships opening up soon other than this newbuilding vessel that will take delivery in about a month from the half time. So there's not too much to fix at this point. The market though is definitely improving. We've seen that we fixed our 2,800 TEU ships at around $20,000 a day about a month ago for two years.

And now, we've seen similar ships being fixed at $25,000 a day. So the market is firming up. Periods available are increasing and there is a continuous increase in the market. How long this continues, it's very difficult to say.

The liners would fix ships that open up within the next couple of months. But not -- they wouldn't offer anything really competitive for ships opening up six months from today. And therefore, we are not really active in that trying to find something today.

Okay, thanks.

Tate Sullivan, Maxim Group.

A follow-up, thank you. You announced the sale of Astoria in April for $10 million and the 20-F indicated the cost that you're carrying value at [3.95]. Did that change? Are there other considerations for the implied gain on that field for this current quarter?

I think that would be -- that's correct. The difference will be [two] minus commission expense or whatever would be the implied capital gain on sale.

(Operator Instructions) Kristoffer, Arctic Securities.

Just comment on what you're assuming in terms of the interest on potential divestments. I mean, you sold one in April, as previously mentioned, are you going to reduce exposure or reduce your fee followed by divesting those vessels?

We are considering -- I guess we want to do with the older vessels as the charters expire. And we haven't taken any decisions yet. But of course, the older vessels which initially we thought we would be needing to scrap at the end of the lucrative charters that we have secured for all of them.

Today, the market is better. So we are considering the options that we have of reselling them or keeping them and rechartering them, and we will develop our strategy as things move on.

Okay, good. And in terms of useful life, what do you see as of the useful life from these vessels now?

Definitely. Even though we have the issues with the CII and the EXI and all these new requirements, technically, the ships can still easily last till the 25th year. And by sailing it a little bit slow speeds, they do satisfy their requirements. So it's more of a commercial decision to decide what to do with them rather than the technical decision. So if that means that if charter rates are satisfactory, we can easily keep them for longer.

Okay, perfect.

We have reached the end of our question-and-answer session. I would like to turn the conference back over to Mr. Pittas for closing remarks.

Well, thank you all for listening in to our results of this quarter. We will be back to you in three months' time. Bye.

Thank you. This will conclude today's conference. You may disconnect your lines at this time and thank you for your participation.