Farmland Partners Inc (FPI) 2016 Q1 法說會逐字稿

Hello and welcome to the Farmland Partners Inc. first-quarter earnings conference call. (Operator Instructions). Please note this event is being recorded.

I would now like to turn the conference over to Paul Pittman, Chairman and CEO. Please go ahead, sir.

Thank you. Good morning and welcome to Farmland Partners' first-quarter 2016 earnings conference call and webcast. We truly appreciate your taking the time to join us for these calls, because we see them as a very important opportunity to share with you our thinking and our strategy in a format less formal and more interactive than public filings and press releases.

Please refer to the Investor Relations section of our website, www.farmlandpartners.com, for our first-quarter earnings call supplement presentation which I will be speaking to later in this call. The link for the presentation is directly below the webcast link and is also posted under our Investor Presentation section on our website.

With me this morning is Luca Fabbri, the Company's Chief Financial Officer. I will now turn it over to Luca for some customary preliminary remarks. Luca.

Thank you, Paul. First and foremost, I would like to also welcome you to this conference call and webcast, and thank you for joining us. The press release announcing our first-quarter earnings was distributed yesterday evening. A replay of this call will be available shortly after the conclusion of the call through May 24, 2016. The numbers to access the replay are provided in the earnings press release. For those who listen to the rebroadcast of this presentation, we remind you that the remarks made herein are as of today, May 10, 2016, and have not been updated subsequent to this initial earnings call.

In this call we will make forward-looking statements, including statements related to the future performance of our portfolio, our identified acquisitions and farm properties under valuation, impact of acquisitions and financing activities, as well as comments on our outlook for our business, rents and the broader agricultural market.

We also will discuss certain non-GAAP financial measures including, but not limited to, FFO, adjusted FFO, EBITDA and adjusted EBITDA. Definitions of these non-GAAP measures, as well as reconciliations to the most comparable GAAP measures, are included in the Company's press release announcing first-quarter earnings which is available on our website, www.farmlandpartners.com.

Listeners are cautioned that these statements are subject to certain risks and uncertainties, many of which are difficult to predict and generally beyond our control. These risks and uncertainties can cause actual results to differ materially from our current expectations, and we advise listeners to review the risk factors discussed in our press release yesterday after market close and in documents we have filed with or furnished to the SEC.

I would now like to turn the call back to our Executive Chairman, President and Chief Executive Officer, Paul Pittman. Paul, back to you.

Thank you, Luca. I'm going to begin by referring to this supplemental document that we have filed, so if everyone on the call can have that in front of them. We have finished yet another very strong and great quarter. The key things going on at the Company are that we are beginning to really see the importance of returns to our growing scale and size. The fundamental strategy of investing in multiple and diverse locations and in many different crops is coming through in terms of the revenues of the Company, and the growth and operating leverage is very, very powerful.

So a couple of key statistics on page number 3 of the earnings supplement. So if you went to the end of the first quarter of 2015, we had around 49,000 acres; at the end of the first quarter in 2016, 107,000 acres, a more than doubling.

The farms that we own went from 93 year over year to 255. The tenants have gone from about approximately 44 to 70. Our employees have grown from 8 to 13. And the closed value of our portfolio is, based on the purchase prices of that portfolio, went from $209 million to $580 million.

So on key operating statistics we are growing very, very rapidly, and we would anticipate that this growth will continue into the future.

Turning over to page 4, which is a look at the similar growth story but from a financial point of view, we've reported GAAP operating revenues have grown from $2.1 million in the quarter to $4.1 million in the quarter, so a huge 123% growth. Crop year adjusted revenue, which feel free to ask before the explanation if you don't understand this in the question-and-answer, but it's a more fair representation in our view of revenues. Crop year adjusted revenue went from $2.2 million, up 167%, to $5.7 million.

AFFO of 400 -- over 400% growth in AFFO, adjusted EBITDA 224% growth. Again, some of the cost side, we've got depreciation, depletion and property operating expenses went up 103%. That's what you would expect because that's going to grow at the same pace as the portfolio overall, more or less.

And then the parts of the cost structure that we really can control are acquisition and diligence costs and G&A. While revenues, again, were growing 167%, we grew the acquisition and diligence and G&A and legal and accounting only 77%. So the story here really is operating leverage and the effect of that as we continue to increase our scale.

I believe that that relationship between our cost side and our revenue side and the differential in growth between those two things, that is a trend that we can maintain for several more years if we keep growing this portfolio.

Looking at AFFO per share, which is on page 5, we grew from $0.04 a share to $0.11 a share, and that is 186% growth. And then also on that page, of course, is the increase in our share count.

Moving on to page 6, which is a little more of a granular analysis of a specific thing we do at the Company but I felt it was important to cover today, is a really deep -- a lot of people have asked us how are we in a somewhat challenging farm economy maintaining rent growth and profitability on assets we already own.

And what this next couple pages does is it looks at the improvements that we make to our properties after we own them. We do not do a lot of development, meaning we don't buy a farm that isn't a farm and take zero cash flow for a few years or even negative cash flow to turn it around, because we think that there's -- on a risk-adjusted basis, that's hard to get a fair return doing that.

However, we do make incremental improvements to farms we own. So since the beginning -- since we went public, we have made very significant improvements, both what we've completed and what we have in process is a little over $10 million of investment into individual farms. And you see each of these projects listed on this page. And they are generally drainage tile, grain bins, irrigation improvements and then are a few other types of improvements. But those are the three major ones that make up the overwhelming majority of what we've done.

You can see the individual amounts we invested. And all I really want to focus on here for a second is the estimated return. So when we make a capital improvement to a farm, and we will make virtually any capital improvement that a farmer asks us to make, assuming that he will pay an increased rent that pays us fairly for making those improvements.

So what you can see here is, take this very first project just for an example, the Abraham farm in Illinois. So we made a modest investment there of about $75,000 to put drainage tile into that farm. This is Illinois, of course, where cap rates are challenging on many farms, and we were able to get a 5% return on that drainage tile. 5% is not a huge number, but it's a very fair number when you think about the fact that drainage tile has an expected life of something between 40 and 50 years, if not longer.

So what we were able to do was make an increase in the rent due to this improvement, and it increases the overall cap rate, of course, on the farm.

Moving kind of just down the page for a second, you'll see irrigation improvements in South Carolina, say Ten Mile or Maidendown. Those are very significant irrigation improvements. We have made significant enhancements to the total yield capability of those farms, and the farmer was paying us a 6% return on those investments in irrigation.

Importantly, though, those investments if we were to sell that farm probably would lead to a material enhancement in the sales price of the farm, something in the neighborhood of $1,500 an acre of additional sales price over what we've put into those farms on a cost basis because they are now irrigated farms.

If you go to the next page, these are sort of the projects that we have in process. There's a couple of projects here with very -- I'm on page 7 if you're following along -- there's a couple projects here with really outstanding returns to the incremental investment we made; so 25%, 36%, 35%. So I want to draw those out and explain what's going on there for a second.

And then also you'll see further down the list, Ten Mile and Maidendown we added drainage tile after we had already irrigated these farms, and so I want to talk about those for just a moment.

So what's going on with Long Prairie, Garrott and Stonington-Bass is these improvements to these farms have allowed us to get -- these farms are operated under a revenue share program and we were able to, because of these investments, have two things happen that substantially increase the rental income that we will get from these farms.

The first is because we improved the farm, the farmer agreed to give us a bigger share of the revenue. So, for example, if it was 25% share of revenue on these farms, it's now 27.5%. And you get that sort of bump in the share of revenue. But the real power that these improvements did, is using Stonington-Bass as an example, we took a farm that was a dryland farm, meaning it had a revenue expectation that might have been $300 an acre, $400 an acre at best, converted it to an irrigated farm where we now have a revenue expectation that is more like $800 to $1,000 an acre.

So you got two effects leading to these big returns on those projects. Effect number one is increasing the share you get from the farmer, which he agrees to give you because you've made a more stable and better farm for him, lowered his risk. But you've also made a material enhancement in the yield on the entire farm, therefore, having really powerful returns to what are frankly modest amounts of incremental investment.

Going on down the page for a second, not everything is always good news on the improvement front. Look at Boe-Goodwater, it's a Nebraska farm. Here we have a zero return on this project, and the reason is what that really is is the replacement of a failed well.

So this farmer, in fairness to the farmer, had been renting an irrigated farm for us, something occurred that frankly made the well fail completely. We had to rebuild -- drill a new well, so we can't really up the rent on the farmer for putting it back in the condition that he thought he had it when he rented it.

So occasionally, and this is pretty much a complete list we've shown you, occasionally we will have one where we get no return, so we wanted to put it in there for sake of completeness. But generally speaking, when we make these improvements we make a material increase in the REIT's revenue from these farms.

Ten Mile and Maidendown again, these farms -- any of you investors on the phone if you'd like to visit them with us some day, feel free to call us. We bought these farms now about a year-and-a-half or so ago, and we have made huge improvements to these farms. We bought them on August 1 of 2015, not quite -- just about a year ago.

These farms are very, very special in terms of their quality by South Carolina standards. We have now irrigated them and drained them. They are probably some of the most -- potentially most productive farms in the Carolinas. The valuation of these farms which doesn't really show up in the way we record properties at our acquisition cost, incredible increase in the valuation of these farms due to the enhancements to their yield potential through drainage and irrigation. Truly beautiful and outstanding farms at this point.

So with that, I will pass it back over to Luca to go through some of the financial highlights of the quarter. And then, of course, we will have the Q&A session after that. Luca.

Thank you, Paul. In the first quarter of 2016, we closed on 125 farms in five states totaling nearly 33,000 acres. That includes our large Paris, Illinois transaction totaling by itself over 22,100 acres, as well as a 7,400 acre contiguous farm in Louisiana. We also put under contract over 1,000 additional acres.

Given our acquisition activity, the first quarter saw also significant activity on the debt financing side. We entered into a $53 million bridge loan with an affiliate of MSD Partners, whose terms included a one-time 4% upfront interest charge totaling $2.120 million, in addition to ongoing interest rate -- sorry, ongoing interest at the rate of 3% over the one-month LIBOR. The bridge loan was repaid within the quarter.

Also in the first quarter we entered into a loan agreement with MetLife. Through this agreement, we have since closed on three term loans totaling $127 million, of which $106 million closed within the first quarter, with interest rates ranging from 2.38% to 2.66% as of March 31.

The MetLife loans have a 10-year term, although interest rates will re-adjust during the term, and are currently backed to either the 3-month LIBOR or the 3-year US Treasury. Proceeds of the MetLife loans have been used to repay debt we had outstanding with MSD, and the First Midwest Bank and to close new acquisitions. As of March 31, the average interest rate on our outstanding debt was 2.74%.

Now let me turn to our first-quarter 2016 financial results. As I cover some of the key highlights, please refer to our earnings press release for more details. For the first quarter of 2016, we recorded rental income of $4.4 million and a net loss of $1.9 million. We received $10.7 million in cash rents, and all our properties are either rented or under contract with the expectation that they will generate rent revenues for the full fiscal year after closing.

Like many other REITs, we look at certain non-GAAP measures, particularly adjusted funds from operations or AFFO, as additional measures of our performance. We calculate FFO, funds from operations, consistent with the definition provided by the National Association of Real Estate Investment Trusts.

The key adjustments we make to FFO to arrive at AFFO are to recognize revenue in the calendar year in which the cash rental payment was actual received, and to exclude non-cash expenses such as stock compensation and certain acquisition-related expenses.

For the first quarter, our AFFO was $1.8 million and on a diluted weighted average basis, AFFO per share was $0.11. When we calculate per share non-GAAP measures on a diluted weighted average basis, we include units in our operating partnership which is our main operating subsidiary, because of their 1 to 1 convertibility into publicly traded shares.

On that basis, our fully diluted weighted average share count was 17,029,623 for the first quarter. As of March 31, 2016, we had 18,858,312 shares outstanding on a fully diluted basis.

This concludes my remarks on our operating performance for the first quarter 2016. Thank you for your time this morning and your interest in Farmland Partners. Operator, we would like to begin the question-and-answer session.

(Operator Instructions). Dave Rodgers, Baird.

Good morning, Paul and Luca. Just wanted to go through a couple of questions if we could. I guess maybe one is, can you talk a little bit about the rental negotiations that you're seeing? And I know that you don't have any rollover, but in terms of the rent negotiations that you see when you're looking to buy assets.

And maybe a part of that, talk about the percentage of sale leaseback transactions versus third-party transactions you're seeing, and kind of the tones in those discussions around rent levels, and are farmers more sensitive to that today?

Absolutely. And for everybody's benefit, Luca and I are actually in different locations this morning, so it may be a little awkward. Luca, if I want to pass a question off to you, I will.

So turning to kind of the broad question of what you're asking, we are seeing cap rates generally speaking creep up slightly. So, in other words, what's happening out there is you are getting -- because of the challenging farm economy at the operating level, you're getting pressure in a modest amount on rents and on land prices.

That what we're seeing -- and this is not widespread but it's anecdotal and we're taking advantage of it -- we're seeing the price of a farm come down faster than we're seeing the rents come down. So let me amplify that for a minute.

So what you'll see is you might -- when there is a death in the family or an estate planning event that leads to the sale of a farm, the farmers themselves are not as aggressive acquirers as they used to be. Two years ago, the farmers drove this market. Today if there is a farm right next door and the farmer really wants it, he will buy it and the prices achieved will frankly be as high as they were a couple of years ago.

But if the farm does not have a natural farmer buyer literally right next door, it may struggle little bit because the farmers are preserving their cash. So we've been able to pick up farms and then turn around and rent them for in the neighborhood of maybe 50 to as much as 100 basis points higher rentals then we had been getting two years ago when everything was frankly stronger in the general farm economy.

What that means is that a little bit of pain in the marketplace is actually creating opportunities for us. And as long as that pain doesn't get too high, you don't get broad-brush declines in valuation. But on a rifle-shot basis, you can get better individual deals and that's where we are today.

As a word of caution, Dave, though, just to be clear, if you continue to see a really difficult operating environment for another couple of years, it will get challenging and frankly maybe cause some price -- real price declines in farmland, although you haven't really seen them yet. And we think -- we don't think that will happen, but it's always useful to keep in the back of your mind.

I guess given some of what you just said, can you talk about -- and I missed some of the earliest part of the call, so I apologize if you talked about it. Can you talk about the acquisition pipeline and maybe where it is, and what you're seeing as a mix between permanent and row crops in there?

Yes, so in terms of the acquisition pipeline, as always it's very, very strong. There is no -- this is such a big market with so few institutional participants of any scale that there is literally endless opportunity of acquisitions, and we have many.

As far as the balance, obviously all the key regions we're in today continue to be good and strong for us. We, as always, are very focused on the Southeast and the Carolinas. We think there is good value and good cap rates there, so we like doing transactions in that region, probably frankly better than anywhere else. But the rest of the country, the Delta, the Corn Belt, the High Plains, all good regions for us.

What we're seeing happen in California, and we don't own any assets in California, is there's been a significant decline in the price of some of the key commodities in California, almonds in particular, since early last fall to today.

That is going to drive, in our view, a material decrease in the valuations of properties, almond ranches in particular, in the Central Valley of California, and that's going to create some buying opportunities. So we're beginning to explore those opportunities as they come along.

We felt that the pricing and the water risk 12 months ago was something we didn't want to take on. The water risk issues, despite a relatively wet winter, are still fundamentally there, but the pricing is a lot more sensible. So we're diligencing and looking at those properties actively; have no idea if we will actually do one, but we do think the time is right for making those investments if we find a good asset with manageable water risk.

Thanks, so that last probably dovetails into my last question which is probably for Luca, but can you talk about where your capital availability stands today, please?

Yes, I will actually go ahead and take that. With the acquisitions we currently have in the pipeline, we frankly don't have a lot of dry powder left. That does not mean we're going to do an offering or anything specifically of that nature; we're not sure.

Our strategy has been more -- as you've all seen, we're way more effective and frankly way happier when we can do acquisitions with our currency, and that would be kind of our chosen direction. Obviously, the returns to scale that I outlined in the beginning of the conference call are quite powerful, so we would like to keep growing.

But we are more or less approaching fully invested at this point in time. So we're not in a situation where major additional acquisitions can be done unless we do them for equity.

Okay, great. Thanks, guys.

(Operator Instructions). Jack Johnson, a private investor.

Yes, my question is about dividend structure. Do you expect the dividend of $0.1275 to remain the same? And also I'd like to ask about, can any of this ever be qualified dividend for tax purposes, qualified dividend or return of capital like long-term, short-term capital gain? That was my question.

Yes. So on the first part of your question -- and Luca, I'm going to turn the second part of that question over to you. But on the first part of this question, the answer is we're likely to keep our dividend where it is. Hopefully, we can raise it over time. But that would be our strategy and our outlook at this point in time, is to maintain the dividend where it is, and we'll see how the rest of the year develops.

Luca, if you can answer the second question, do, and maybe you can't off the top of your head.

Yes, I don't have our tax people here in the room with me, but fundamentally the qualified nature of the dividend, of the given income, really depends on the specific circumstances of the individual investor.

I see.

I would encourage you to feel free to call the Company and we'll help you think through that if you would like. But it is a little bit investor-by-investor specific.

Okay, I'm just interested in the qualified dividend aspect for individual federal tax purposes. That's all.

Okay, great.

Yes, and specifically if that concerns the income -- the portion of the dividend that reflects income in our taxable REIT subsidiary, which is a taxable C corporation, right now we -- that taxable REIT subsidiary is of a relatively very, very small scale. Just as a reminder, it directly farms just a few acres. They are more of a way for us to really be in touch with the farming economy better rather than to specifically generate income, as I said, as of this point.

So there is really not very significant qualified portion of the dividend income at this point, in that respect.

Okay. Also are you having an annual meeting on May 25?

That is correct, yes, 8:00 AM at the Company's offices in Denver.

May 25. And is that open for individual investors?

Absolutely. Like any public company shareholders' meeting, any shareholder can participate.

Okay, May 25, 8:00 AM. Thank you.

Thank you.

(Operator Instructions). Rob Stevenson, Janney.

Good morning, guys. Paul, just to follow up on your comments around Dave's question about essentially dry powder. If the stock is not at a level where you want it to be and obviously below the sort of $12.55, 52-week high, etc., and you don't really want to use that as a currency, do you think about just basically operating the current portfolio? Or does it lead you down the path of trying to explore joint venture or partner opportunities as a way to access equity capital, a different type of equity capital at perhaps a cheaper rate?

Well, obviously, we explore every alternative at all points in time. The goal here is to make as much money for shareholders as we possibly can and, obviously, as you all know, I'm one of the major shareholders. So our perspective on this, and it's the same as it's frankly always been, is issuing equity of any type below net asset value is always difficult.

However, if you have investments with accretive return scenarios that you can execute on and give you higher cash flows and potential for higher dividends and so on and so forth, it's not an absolute binary question you have to ask.

We like to be very, very disciplined in how we do this. We have created a company of significant enough scale that we don't have to raise capital. But you saw the numbers that I outlined on what the effect of growth is on the bottom line.

So there's no easy answer here. The one thing that is kind of a universal truth is that the fees and expenses associated with equity raising through acquisition transactions are way, way lower than the fees and expenses associated with doing any kind of equity offering through the investment banks. So we have a huge preference for using our currency in an acquisition, as opposed to returning to the market.

We've got all of the bells and whistles you would expect of a public company at this point in time. Even though we're small, we have a shelf registration statement and all of the avenues of capital raising that gives us. We explore from time to time various joint venture structures with people where we would manage money alongside the public company in some sort of sidecar structure. We've got conversations of that nature going on all the time.

But it's got to be fair to the public shareholders. Whatever it is we do of that nature can't be, as I jokingly call it, a heads they win, tails we lose approach. And sometimes it's difficult to get those deals put together in a way that's fundamentally fair to the public shareholder.

So we're exploring every avenue. Keeping our cost of capital low is incredibly important to us, but continuing to grow the Company is also important. So there is no clear answer; there's no silver bullet there for what we'll do.

Okay. And then just lastly, for the crops and locations that you really want to own or to acquire at this point, what would you say pricing relative to a year ago is for those farms today? Are we slightly up, slightly down? Has there been more of a disruption for the stuff that you would really like to add to the portfolio? Or has the higher quality stuff not really moved over the last 12 months?

Well, so it's very -- it's different from each region. So when you kind of think about the major regions, you're seeing somewhat of a price resetting on the West Coast where we don't own assets today, but hope to. Obviously, since we're not invested in that market yet, a decrease in price on those assets would be a good thing for us.

If you go to the core of the Midwest, the Corn Belt, there's been some level of price pressure. That's a very corn and soybean intensive region; although it's not frankly all that significant, but certainly modestly down. We think that that kind of gradual slow decline in values in that region will continue until the farm economy turns around, but it's not going to be any kind of violent, negative downward trend.

The Carolinas are actually holding up pretty well. I think in prior phone calls I talked a lot about the positive basis, meaning the profit above or the price above Chicago Board of Trade for most major commodities out in the Southeast. That trend continues. We're able to make these major improvements to those farms, and that region is good and very strong for us. We continue to acquire there.

The Delta, the Delta is a very unusual region. It's got a lot of crop variety, much more than the Midwest. So you're seeing -- for the better properties, you're seeing valuations hold up pretty well. That sort of quality differential is significant in the marketplace. Meaning the very best properties, sort of say top quartile and above, you've seen very little decline in the valuation of those farms.

When you get into the bottom quartile, you've seen frankly quite a bit of decline. We don't own any in the bottom quartile, at least we hope we don't.

And that middle -- the middle two quartiles, slightly downward pressure on those farms would be my overall nationwide judgment. But again, this is a market -- if you look back to the 1980s, for example, which was a truly tough time in the farm economy, and we're nowhere close to that sort of event now.

But you saw an approximately 5% decline in farmland for several years in a row. You never did really go off the cliff; it just kind of grounds down slowly. And that's, frankly, one of the benefits of the asset class is that it's all about food demand, and you just don't get real violent changes like you do in other real estate assets. Hope that helps.

That does. Thank you very much, guys, appreciate it.

Dan Altscher, FJ Capital.

Good morning, Paul and Luca. It's nice to be talking to you guys again. I was wondering if you could just maybe give kind of an update on what you think the run rate NOI kind of looks like right now, especially considering the really big transformational acquisition that was done through -- in the quarter with the Paris farm.

Yes, I don't know if I can do it on it on an NOI basis. I'll do it on a rental rate basis. Our run rate as of now, if we didn't do any further acquisitions, we'd be running right around $23 million of revenue for the year. We've got a few acquisitions in the pipeline that ought to take that up slightly.

So that's a pretty significant increase if that's where we come out for the year compared to year end last year; not a doubling but a significant jump, of course. So we feel pretty good about the continued increase in revenue and all the benefits that come from that.

Okay. And Paul, I won't hold you to a number, but I just want to clarify the $23 million run rate. That's a cash number, not just a GAAP number, right?

That's exactly right. I'm speaking in terms of what we would call crop year adjusted revenue.

Yes, perfect. Okay, and then just one other quick one. Since you did mention or I guess the discussion brought up around capital and NAV, and your commentary on where pricing has been right now. Do you have an update or a thought as to maybe a range of what NAV looks like at the end of the quarter for the Company?

Well, we always say -- and obviously, it's changed over time. But our view is that that net asset value of the Company is between $12 and $12.50. Many of you investors ask me this from time to time, and we always frankly speak as openly as we can about it.

The range that the Wall Street analysts have is a little broader. I think there's a low of $11.50, and there might be one that's out there at $13 or so. So we're kind of in the middle of that range. NAV is a difficult thing to have a perfect handle on. Our method of calculation is to take the purchase price of the assets minus the debt plus the cash, divided by the shares outstanding.

We don't mark up farms in our portfolio that may have materially enhanced in value. Frankly, the ones where I talked about doing drainage and irrigation are probably huge bumps in value. On the other hand, I would be certain we have a farm in our portfolio that's probably worth a little less than what we paid for it at this point in time.

I don't put a lot of stock in annual appraisals. I think that's frankly a relatively expensive process for not a great deal of value, in terms of the confidence in the result. Not because appraisers are bad, but you have to understand they are forced to perform a certain process and their charge is to do a process based on that set of rules and regulations.

It is not really answering the question of what farms are worth; it's answering the question of what farms are worth under this very mechanical valuation approach, which has a whole set of errors embedded in it automatically.

So given that everything we have has been -- there's been an arm's length market transaction of some sort in the last two years, we think acquisition cost is probably the safest judgment of value. If we get out another two or three years and a major portion of this portfolio has been held for five years or more, doing some third-party appraisals, for example, would make sense. But this idea that you hold something for a year and it's up 20%, that frankly I believe is hogwash. The market is more efficient than that.

So our view is we just present NAV the way I said it, and we think it's a range of $12 to $12.50.

Great. Thank you, Paul. I appreciate all the color as always.

Thanks.

This concludes our question-and-answer session. I would now like to turn the call back over to Paul Pittman for any closing remarks.

Thank you. We continue to appreciate your interest in our Company. And with any follow-up questions, please feel free to contact me via email and we'll try to help answer them. Thank you all for your time today.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect your lines. Have a great day.