Fresh Del Monte Produce Inc (FDP) 2009 Q2 法說會逐字稿

Good day, ladies and gentlemen, and welcome to the Del Monte Fresh Produce's second-quarter 2009 conference call.

At this time, all participants are in a listen-only mode. At the conclusion of our prepared remarks, we will conduct a question-and-answer session. (Operator Instructions). As a reminder, this call is being recorded.

I would now like to introduce your host for today's conference call, Ms. Christine Cannella. Please go ahead, ma'am.

Thank you, Jennifer. Good morning, everyone, and welcome to Fresh Del Monte's second-quarter 2009 conference call. I am Christine Cannella, Assistant Vice President of Investor Relations. Joining me today are Chairman and Chief Executive Officer Mohammad Abu-Ghazaleh, and Senior Vice President and Chief Financial Officer Richard Contreras, who will discuss our results for the second quarter.

Fresh Del Monte issued a press release this morning via Businesswire, e-mail and First Call. You may visit our website at www.FreshDelMonte.com to register for future distributions.

This conference call is being webcast live on our website and it will be available for replay approximately two hours after conclusion of this call.

Our press release includes reconciliations of any non-GAAP financial measures we mention in our presentations today to the corresponding GAAP measures. The press release may be found on our website, which is, again, www.FreshDelMonte.com.

This morning, Mohammad will review our operating performance during the quarter, along with recent developments and our future outlook. Richard will then review our financial performance for the second quarter of 2009.

Please let remind you that much of the information that we will discuss this morning, including the answers we give in response to your questions, may include forward-looking statements regarding our beliefs and current expectations with respect to various matters. These forward-looking statements are intended to fall within the Safe Harbor provisions of the Securities laws. Our actual results may differ materially from those in the forward-looking statements as a result of various factors, including those described under the heading "Description of Business Risk Factors" in our Form 10-K(a) for the year ended December 26, 2008.

This call is the property of Fresh Del Monte Produce. Redistribution, retransmission or rebroadcast of this call in any form without our written consent is strictly prohibited.

With that, I'd like to turn the call over to Mohammad Abu-Ghazaleh.

Thank you, Christine. Good morning, everyone. I am pleased to update you on our second-quarter performance and strategic actions taken during the quarter to drive future growth and profitability.

One of the key drivers of our growth during the quarter was our banana business segment. Bananas continued to benefit from higher worldwide selling prices, driven by strong global demand and industry supply shortages. We anticipate that our banana business will remain strong and I believe it will bring significant opportunity for Fresh Del Monte.

Our other fresh produce business segment performed well during the quarter with stronger melon, avocado and gold pineapple product sales. As we successfully delivered additional volume to existing and new customers, we also took steps in the quarter to improve our cost structure and enhance the competitive position of our fresh-cut operation in North America.

We continue to work closely with our customers using store data to optimize SKUs. This, in turn, led to enhancement of our production techniques, resulting in increased product utilization and lower labor costs.

As a result of our continued efforts to streamline operations and improve our cost structure, we made the decision to stop planting gold pineapples in Brazil. We will continue to ship the remaining pineapples that are in the ground as long as it is economically feasible. Although we have stopped planting pineapples, we will continue to source bananas and melons from Brazil.

This year, our Prepared Food segment delivered substantial margin improvement compared to last year's second quarter. The increase in gross profit was a direct result of lower costs. Current economic conditions did affect our sales in the quarter, primarily in the UK, one of our strongest markets. We are working diligently with our third-party distributors during these challenging economic times to increase sales in this highly competitive business.

In our Middle East region, I am particularly pleased that our global distribution expansion project in Saudi Arabia is on track to open our [fresh] distribution center in late October. We plan to open the second distribution center by January 2010. Demand for our products, particularly bananas, continues to increase, and we believe this region offers us exciting opportunities for growth.

It is important to note that, during the quarter, we delivered strong cash flow. This allows us to significantly reduce our debt levels, and we successfully completed the refinancing of our credit facilities.

Despite the tight lending market, we received great interest to participate in the refinancing, and the offering was significantly oversubscribed, which is indicative of our strong credit quality. The credit terms we achieved demonstrate that companies with consistently strong cash flows, strong balance sheets and proven management teams can attract financing at favorable rates even in challenging economic times.

All of us continue to deal with the difficult economic environment. Health and wellness continues to remain of paramount importance in consumer food purchase decisions. In fact, with fewer discretionary dollars, people are cooking at home more; they are choosing to purchase value products that are good for them, such as fruit and vegetables.

In summary, the current economic environment remains challenging. However, I am very confident in our ability to overcome the impact of these global challenges and will remain committed to delivering the products and service our customers have come to expect from us. We will continue to explore opportunities and make investments that support the growth of our core products and deliver results to our shareholders.

We will continue to leverage the strength of our management team and our drastically integrated infrastructure, be it by acquisitions, organic growth or third-party sourcing. We believe, in these challenging economic times, there are significant growth opportunities for Fresh Del Monte. Our proven strategy, strong global presence, and financial stability positions Fresh Del Monte for long-term growth and success.

Now, I would like to turn today's call over to Richard.

Thanks, Mohammad, and good morning.

For the second quarter of 2009, excluding asset impairment and other charges net, Fresh Del Monte delivered earnings per share of $1.11 per diluted share compared with $0.87 in the prior-year period. Net sales increased $6 million to $978 million compared with $972 million in the second quarter of 2008. In addition, excluding asset impairment and other charges net, gross profit increased $6 million, or 6%, to $108 million. Operating income increased to $7 million, or 12%, and net income increased $15 million to $70 million.

Now let's turn to our segment performance. In our banana business segment, net sales increased 8% to $413 million. Worldwide pricing increased 7%, or $0.99 per box, to $15.14, primarily due to lower industry supply and increased worldwide demand. We also benefited from higher local currency pricing in our major overseas markets. Volume was in line with last year.

Unit costs increased 6%, driven by a 12% increase in fruit production and procurement costs. Gross profit increased 14% to $47 million, compared with $42 million a year ago, due to higher pricing partially offset by significantly higher fruit costs.

Our banana volume and food costs were negatively impacted by the cold weather, heavy rains and flooding that occurred in late 2008 and early 2009 in Costa Rica. The decrease in our production volume required us to purchase more expensive fruit from Ecuador. Additionally, the government-regulated minimum price per box paid to growers in Costa Rica was 18% higher than the prior-year quarter.

In our Other Fresh Produce business segment for the second quarter, net sales increased to $446 million, compared with $444 million in 2008. The increase was primarily due to higher sales in our melon, avocado, and gold pineapple product categories, offset by lower sales in our tomato and deciduous product categories.

Volume was 16% higher. Unit pricing declined 13%. Unit costs decreased 6%. For the quarter, gross profit increased 9% to $44 million, excluding $17 million related to our decision to discontinue planting pineapple in Brazil. This compared with $41 million in the prior-year period. The increase in gross profit was related to higher volume and lower fruit and distribution costs.

In our gold pineapple category, net sales increased by 7% to $128 million. Volume rose 16% in our European and North America regions principally due to the Caribana acquisition.

Unit pricing was 8% lower, reflecting both the negative economic environment and a temporary industry oversupply, and unit costs decreased 7%. The temporary industry oversupply was a result of climatic changes that forced fruit to mature ahead of schedule. We are now seeing the opposite effect and in the current third quarter are experiencing extremely tight industry supply of gold pineapple.

As Mohammad mentioned, during the quarter, the decision was made to cease planting pineapple in Brazil. As a result, we wrote off $17 million in deferred crop inventory and $1 million in assets. In 2008, we sourced approximately 2 million boxes of gold pineapple from Brazil for our European markets.

In our melon category, net sales increased 23% to $71 million. Volume increased 31%, a result of higher production yields in the offshore season. Unit pricing declined 6% due to higher volume and the weak economy, and unit costs were 3% lower.

Our second-quarter results were negatively impacted by the lingering effects of offshore season. However, during the domestic season, which began in mid-May, we experienced lower costs and improved profitability compared to last year during that same period.

In our fresh-cut category, net sales declined 3% to $89 million, primarily in the UK. Volume increased 4%. Unit pricing decreased 6%, primarily due to unfavorable exchange rates in the UK. However, unit costs were 16% lower due to significant improvements in our North America operations and exchange rates in the UK. We also benefited from a more stable labor force.

In our non-tropical category, net sales decreased 3% as lower deciduous sales were partially offset by an increase in avocado sales. Volume rose 9%, primarily in avocados. Unit pricing declined 11%, due in part to unfavorable exchange rates in Europe, and unit costs were 7% lower.

In our tomato category, net sales declined 12% to $34 million. Volume decreased 8%, and pricing decreased 5%. However, unit costs were 9% lower.

In our Prepared Foods segment, net sales decreased $29 million to $86 million during the quarter, primarily due to current economic conditions in the UK and unfavorable foreign exchange. Unit pricing decreased 7%. Unit costs were 25% lower, due to favorable exchange rates in our producing countries and lower ocean freight costs. Gross profit increased 11% to $17 million, driven by the significantly lower costs.

In our Other Products and Services business segment, net sales for the quarter increased 6% to $34 million. Gross profit decreased by $2 million, primarily in our Argentine grain business, a result of the downturn in the global grain markets.

Now a few comments on costs -- fertilizer costs decreased 5% over the prior-year period. Fertilizer represents approximately 1% of our total cost of sales. Container board costs declined 22% and represent 2% of our total cost of sales. As previously mentioned, banana fruit costs increased 12%, and this represents 25% of our total cost of sales. Bunker fuel costs, which represent 3% of our total cost of sales, declined 45% versus the prior year. Total ocean freight costs, which include bunker fuel, declined 10% and represent 14% of our total cost of sales.

The foreign currency impact at the sales level for the second quarter compared to the prior year was unfavorable by $42 million. However, the foreign currency impact at the gross profit level in the second quarter of 2009 was unfavorable by $4 million compared to the prior year as we benefited from a stronger dollar in some of our producing countries.

SG&A expense during the quarter was $42 million compared with $43 million in the second quarter of 2008. For the quarter, interest expense net increased by approximately $1 million. At the end of the quarter, our debt was $335 million. We recently announced that we refinanced our revolving credit facility and term loan with a 3.5 year $500 million senior secured revolving credit facility that matures in January 2013. The new facility bears interest at a rate of LIBOR plus a margin that varies with our leverage ratio. Our current margin over LIBOR is 3%.

We currently have approximately $175 million of availability for working capital needs, general corporate purposes and other uses.

Other income, net, was $5 million compared with other income of $3 million in the prior-year period, primarily due to foreign exchange gains.

Tax expense for the quarter was a benefit of $4 million. The benefit for income taxes is primarily related to the settlement of uncertain tax positions in connection with an audit in the second quarter of 2009. We expect our capital expenditures for the year to be approximately $105 million.

This concludes our financial review. Operator, can you please open the line for questions?

Yes, sir. Once again, the question-and-answer session will be conducted electronically. (Operator Instructions). Heather Jones, BB&T Capital Markets.

Good morning. Good quarter and also I wanted to say thank you for breaking out those different costs and all and what their trends were in the quarter.

I guess I would like to start on the banana side. I was wondering when you anticipate the impact of the flooding, cold weather, etc., to moderate on your plantations.

I believe, Heather, it will not be before towards the end of this year because we've just been actually to the plantations a few days ago. What I saw is that really the flooding has done a lot of damage and the weather pattern hasn't been very good at all in the last few months, not only the flood but there has been a lot of cold periods, a lot of wind, and this has affected even the plantation further. So I believe that, if the weather remains reasonably stable during the next few months, I think we will recover to normal production by the end of this year.

Okay. Would you expect the impact on fruit costs to be insignificant in Q3 as it was in Q2?

There are several factors that will lead to that -- as I said, if the production goes back to normal, provided the weather stays reasonably stable, that's one. The other one is also what -- also governments are becoming more involved now in pricing and fixing prices for the exit price for the bananas. So this is something that we cannot control as well.

You know that the only way that we can really work on our course despite increasing our yields and improving our production rates.

As far as exit price, that's something that really we cannot control. But I believe that we should, provided everything remains stable, we should see an improvement in our costs.

But going to this idea -- because I think it's not -- if you look at imports into the EU for the first half, they are down meaningfully not just from Costa Rica but Panama, Colombia, etc. So your costs are up, but is it a fair point that this is being offset by better pricing? I mean, Q2, especially during the latter half, EU pricing was very strong year-on-year and our check showed that it's still -- it has weakened seasonally but is still up meaningfully from last year. I am just wondering if that is consistent with what you are seeing.

Yes, I agree with you that the pricing in Europe has helped a lot during the second half, especially in the first two months of the second half. I mean, the prices have declined quite substantially from where they were a month ago. I mean, right now, really, as we speak now, the price is not going to cover the cost. But we hope that, once the vacations and the back-to-school people start coming back to school, that will change. We believe that the prices will start climbing back up again.

Okay. Just a broader, like longer-term question, going back to the government setting the minimum fruit prices, fuel is down now but still is historically high and all. Is it your view that results in a greater likelihood of more rational end markets or just get your thoughts on that idea?

I believe that, long term, I believe that the market will be more rational. I believe that supplies have come to a point where there will not be a huge upsurge of supplies in the future. The only country that might have upside would be Ecuador. Panama is almost done with the way that the [labor] has been taking care of the farmers. Costa Rica is almost fully utilized -- I mean land-wise. Colombia more or less the same story. Guatemala probably will increase a little bit.

So my view for the long term, I think that bananas will become a stable commodity.

Okay. My final question is on pineapple. You mentioned that the supplies are much tighter, and from what we understand, a lot of fruit is getting rejected in Costa Rica because quality is poor, etc., and so that is tightening up the market. So I guess my question is, is that affecting your supply or is your production really unaffected so you are just simply benefiting from higher prices?

No, our own production has not being affected, really. It is independent. The third-party production that has been, especially on the Atlantic side, has been greatly affected by the weather conditions that has prevailed during the last several months. That is what is causing these kinds of projections.

So it is a net/net positive for you?

Well, we consider ourselves maybe lucky in one way and maybe more proficient in another way.

(laughter) But either way, it is going to be good for the numbers?

Yes, I think we are better off than others, yes.

Bill Chappell, SunTrust.

Good morning. I guess first, on exiting Brazil, can you give us kind of an idea how much, if at all, of a revenue hit that will be for that business maybe over the next 12 months?

It was 2 million boxes was the production there, Bill. So --

Not really. Not significant at all.

Then is this part of a plan? Are you looking to rationalize worldwide or what was this just a one-off type case?

As I've always said, we look at our business; we focus on it regularly and continuously. Whenever we see that there is an area where it has not really been helping the Company -- on the contrary, it would be a negative impact on our results -- we take a look at it and we try to rectify it. If it doesn't turn out to be right, we just deal with it. That's one of the cases that we have to take that decision.

Okay. Then on the commodity costs, certainly it is nice to see the relief finally come through in terms of containerboard and (inaudible) fuel and what have you. I mean, are we seeing the full benefit this quarter? I know there's a bit of a lag. Do you expect it to get even better as we move forward through the rest of this year?

Probably on the melon side yes, because melon you know is seasonal and last year, the offshore melon season was all of the raw material, be it fertilizers, pesticides, (inaudible). Everything was bought at the peak in the market in terms of costing. Of course, costs have come down significantly since then, and we believe this is the area where we will benefit the most. Bananas and pineapples are more or less on a much shorter kind of plan, you know, in buying of all of these materials. So yes, it will -- we will see some benefit on the melon side.

Okay, great. Then Richard, just one question on the new credit facility. Is it right to say about $12 million to $14 million is kind of annualized interest expense? Would that start this September quarter?

Starting immediately, 350 times LIBOR plus 3 is what we have right now. Now, that will go up and down and we are coming into our season second-half of the year, where we borrow some. But that's what we have now is 350.

So are we at the -- when you say that LIBOR plus 350, is that roughly the floor? Because I would imagine you are also paying down debt, so that should go a whole lot higher, other than if LIBOR goes up.

The debt will swing up higher seasonally and then it will come back down again, but LIBOR plus 3, not 350, LIBOR plus 3. If our leverage goes down in the future, that will come down as well.

Okay, and then just one last question. I may have missed the difference on the tax rate this quarter, or just tax benefit versus taxes paid.

Yes, that was some unusual -- that was just a reversal of some accruals that we had based on the satisfaction of some audits. But for the future, I think you should still continue to use about a 6% rate.

Great. Well, nice quarter. Thanks so much.

Jonathan Feeney, Janney Montgomery Scott.

Good morning, thank you very much.

First question -- Mohammad, to what extent does this decision to exit the pineapple business in Brazil reflect maybe a more disappointment with pineapples in Europe particularly? Is it -- do you feel like that -- it seems like that's where a lot of the weakness has been. Are you feeling less bullish about the growth in that area?

I'm sorry, could you repeat? We cannot hear well.

Oh, I'm sorry. The decision to exit pineapples in Brazil, is it a reflection of bearishness about demand in Europe, particularly for gold pineapple? What does it say about your outlook there?

No, no, no, no. It has nothing to do with demand or the market situation. It was a purely technical reason that we had to pull out the pineapples from Brazil, because there were several agricultural factors that were not favorable. The deals that were obtained for instance in Costa Rica, in the Philippines, are completely higher and better than the ones from Brazil. So, it was a matter of cost element and production element, nothing to do with the markets.

Okay. (inaudible) should we expect a cost-benefit, you know, any -- I know it's a small amount of volume, but I'm imagining the struggle cost you some money in the past couple of quarters. Should we expect a cost-benefit the next couple of quarters from that decision?

Definitely going forward. You know, I don't know if it's the next quarter, the second or the fourth quarter, but definitely going forward, there will be a benefit of savings and no rationalization. Yes, I agree on that, but I cannot define the time where that we would show this benefit.

Okay, thank you. When we think about global governments like, say, Costa Rica raising minimum prices, it certainly makes your decision to purchase Caribana look (inaudible). I wonder. Does that make you more likely to vertically integrate, to buy more acreage of bananas or pineapples in these countries where minimums are going up so that you can benefit from what effectively will be margin expansion.

Well, I think that the Caribana acquisition, especially during this past year, has been very, very helpful because, if it wasn't for the Caribana volume that we had, especially in bananas, would have been really helped very much during the last six, seven months because of the flood and the weather pattern. So it was an excellent, as you said, an excellent acquisition in my opinion.

Today, to go and buy additional land, I believe that, first, there are not so many farms for sale in the Caribbean. Second, the cost is prohibitive. I mean, the prices are becoming prohibitive to buy even land in these countries if it's available. It is becoming so prohibitive that to really make a new plantation does not make much sense.

It's nice to see a real estate market going up somewhere, right?

Finally, just one question -- you know, this avocados grove, I know it's small for you but it's kind of a big-picture question. I know you are always looking for ways to leverage the Del Monte brand name globally into a growth area. It seems like you've heard in a couple of spots about this growth. Can you talk a little bit about what the future might hold for avocados and Fresh Del Monte?

Avocados were really gearing up to increase our volumes. (technical difficulty) supplies are limited. The major supplier is Mexico, and Mexico is tight.

The other place that we import from is Chile. Of course, the local production is California, but if you look at all of these sourcings, they are really getting tighter every year. Now, we see prices of avocados in the mid 50s, which is unheard of. I mean, it is really fantastic prices that we are seeing right now.

We are trying to increase our sourcing from Mexico and we intend to do that. We increase -- are also increasing our volumes from Chile, so we are working very hard to increase and taking the necessary challenge to improve our -- it is a very profitable business, and we need to grow in that business as we go forward.

But at the same time, we are looking at other vegetable items that we can outsource from offshore, which can complement the avocados in a very attractive way. As we go forward, we will keep you informed of (inaudible).

Thank you very much. I appreciate.

Vincent Andrews, Morgan Stanley.

Good morning, everybody. If I could just ask on banana volumes, one of the difficulties we had (technical difficulty) was estimating what you lost in the quarter from the floods relative to what you got back from the Caribana acquisition. Is there any way that you can help us reconcile that?

Yes, the Caribana volume is down about 14% from what we had originally quoted and that is, banana-wise, that's all from the floods and the weather. Then the company volume has also been impacted, and that's down about 10%. I am just talking quarter-over-quarter.

Got it. All right, that's -- and how should we think about that as we look out to the rest of the year?

Well, I think what Mohammad said -- that will probably linger throughout the rest of the year.

Those are good run rates for the next two quarters, then?

I would say so.

Okay. Then it seems like some of the comments in the press release suggested that there was a sequential improvement in pineapple demand. Am I listening to that correctly?

Yes, demand hasn't been diminished in the markets. Of course, there were periods in the last couple of months where supplies were huge. I mean, there was an oversupply in the market, and that was because there as precarious fruit which is natural flowering which cannot be controlled. There was huge supplies in the market; that depressed the prices far and wide. Now we see, again, a normal pattern where supplies are tight and the prices have gone up. So the pineapple business hasn't been affected except by the oversupply that we've seen in the last couple of months.

I thought I remembered from last quarter that pineapple demand and pricing was being impacted by the recession. Is that not the case?

No, not really, not really. In a way yes, but as far as Fresh Del Monte is concerned, we still have our customers, we still have our volumes moving, and definitely the prices have been impacted because of the recession.

Okay. Then, Mohammad, on the Middle East revenue number for the quarter, last quarter you said that the deceleration in the growth there was largely a function of your kind of optimizing distribution of fruit, and you were taking bananas out of the Middle East and sending them to Asia. Is that still what's taking place?

Right up until last month, yes, that was the case.

Okay, and so what is happening now that you're -- has something changed in the Asian market that you're not doing that anymore?

You know, we monitor the markets and that removes the fruit wherever there is the optimum price. Now it's the summertime in all of the markets usually are soft, so --

Understood.

So it's not a real period to compare with, but definitely we are planning. Of course, once we open our markets in Saudi Arabia by October-November, we will have to create more volumes into these markets to meet the demand.

(Operator Instructions). Scott Mushkin, Jefferies & Co.

I wanted to touch on the pineapple business a little bit more, Mohammad, and get your thoughts here. I mean, one of the things that's happened in pineapples over time is more people have come in; those profits have slowly declined. Now, it sounds like maybe the growing conditions on the east side of Costa Rica aren't maybe as optimal as people had thought originally, and that's where I think a lot of the independent growers are, if that's right. Do you think this has permanently changed the idea that the pineapple business may be slowly declining and maybe we will see an end to that in the long-term outlooks for pineapples, given what is going on with independents is better than maybe we had anticipated six months to a year ago?

My answer is yes, and I always believe in that. It was a goldrush at the beginning, and now people realize that there is not so much gold to find and will have to look somewhere else for the gold.

Do you anticipate some of these independent people will cease on the eastern side of Costa Rica?

I believe that would happen, yes, because, first of all, to replant pineapple is very expensive. You know, it's not like bananas that grows by itself every 18 months or so. Every two years, you have to replant the same fields again. This is very costly -- I mean a very high cost.

On the second hand, I think banks now are very reluctant to advance money and loans to especially people in agriculture these days. So there are several factors that work in that direction. I think we will not see this immediate effect but long-term, I believe this is a viable case.

Then one final one on the same subject. Caribana I believe had some pineapple farms on the eastern side of Costa Rica. How did their -- I think they were a little higher up than some of the independents. How did they fare in this whole weather situation?

Well, let me be very, very honest -- that the farms, when we received them, were not at the optimum condition, and they didn't have the same agricultural practices and (inaudible) that we use at Del Monte. Since then, there has been a gradual transformation. Hopefully, by sometime next year, we will bring them up to the standards and to the same yields of Del Monte farms. So we are very confident that we will bring them to Del Monte standards in the near future.

Okay, I guess just one clarification -- I think you said -- and if I have the quote right on bananas, prices are not covering increased cost for the moment, but they were in the second quarter; they are not now and you anticipate, as we get back to school, that you will once again recover all of the costs, increased costs with prices in Europe. Is that -- did I hear you correctly?

That is what I believe, yes. I believe that come maybe September-October we will start seeing the prices to move up again, provided of course there is no oversupply, because we don't know what will happen. It could be that, in the tropics, we will see production coming back to high levels, but all in all, I believe that the prices should improve as we go into September-October period.

Richard, maybe one final -- I keep going here -- but remind us what percentage of bananas are grown on your own farms.

Worldwide, I think it is about 30%.

Okay, 30% worldwide?

Right. Remember, that's skewed because of mostly Philippine is third-party. In Latin America, I'd say it's higher; it's a lot higher.

So how about coming into North America? What is that? Do you know that off the top of your head?

I don't because we source from Central America. We source both Europe and North America segregated that way.

All right. Good. Well, thanks, guys. Thanks for taking my questions.

Okay. There are no further questions at this time, so I would like to turn the conference back over to our speaker, Mr. Abu-Ghazaleh for any additional or closing remarks.

Thank you very much. I would like to thank everybody for the time and patience. Definitely, I would like to say that we are still facing challenging times. You know, the storm isn't over and hopefully we will overcome, and hopefully that next time we speak, we will still have some good news.

Thank you very much. Talk to you soon.

Thank you. That does conclude today's teleconference. We thank you all for your participation.