Fiesta Restaurant Group Inc (FRGI) 2017 Q3 法說會逐字稿

Good afternoon, and welcome to the Fiesta Restaurant Group, Inc. Third Quarter 2017 Earnings Conference Call. Today's conference call is being recorded. (Operator Instructions) I'd like to turn the conference call over to Raphael Gross, Managing Director at ICR. Thank you. You may begin.

Good afternoon, everyone. Fiesta Restaurant Group's Third Quarter 2017 Earnings Release was issued after the market close today. If you have not already accessed it, it can be found on the company's website, www.frgi.com, under the Investor Relations section.

Before we begin, I'd like to inform you that during the call today, the company will make various statements that are not based on historical information. These forward-looking statements include, without limitation, statements regarding the company's future financial position and results of operations, business strategy, budget, projected costs and plans and objectives of management for future operations.

Actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements, and the company can give no assurance that such forward-looking statements will prove to be correct. Important factors that can cause actual results to differ materially from those expressed or implied by the forward-looking statements can be found in the company's SEC filings.

Please note that during today's conference call, certain non-GAAP financial measures will be discussed, which the company believes can be useful in evaluating its performance. Any discussion of such information should not be considered in isolation or as a substitute for results prepared in accordance with GAAP, and a reconciliation to comparable GAAP measures is available in the company's earnings release.

On the call today are President and Chief Executive Officer, Rich Stockinger; Senior Vice President, Chief Operating Officer and Pollo Tropical President, Danny Meisenheimer; and Senior Vice President and Chief Financial Officer, Lynn Schweinfurth.

And now I will turn the call over to Rich.

Thank you, Raph. Q3 was certainly a challenging quarter for Fiesta and our team members as hurricanes Harvey and Irma impacted the majority of our restaurants and the communities where they operate. Within 2 weeks of Hurricane Harvey's arrival into Texas, that caused severe flooding in the Houston area and disruption to our San Antonio operations, we closed every Pollo Tropical restaurant in Florida and Atlanta as we prepared and withstood the impact of Hurricane Irma.

Given the severity of the storms, I am pleased to report that there were no injuries incurred by our team members and that all of our restaurants that we had planned to reopen have done so with the exception of 1 Taco Cabana location. Resuming full operations after the storms had passed was a tremendous effort undertaken by our team members and supplier partners, and we thank them all for their diligence and tenacity.

We are proud that Taco Cabana and Pollo Tropical served thousands of meals to evacuees and first responders in both Texas and Florida. These efforts have been captured on video and can be accessed on our website. In addition, through our nonprofit Fiesta family foundation, we are continuing to assist many of our team members who have personally suffered losses as a result of these storms.

In the aftermath of Hurricane Harvey and the related uncertainty, we decided to permanently close our 2 Houston Pollo Tropical locations. Due to limited awareness of the Pollo Tropical brand and the high relative overhead costs needed to support the 4 remaining restaurants in San Antonio, we decided to permanently close all 6 Pollo Tropical restaurants in Texas and focus on revitalizing core markets and our brand repositioning strategy.

The hurricanes resulted in a short-term loss of business and inventory as well as some property damage and delayed our brand relaunches, but we are back on track now. As Danny will explain, we relaunched Pollo Tropical last month with new menu items and a new ad campaign. Importantly, just prior to the hurricanes, we were experiencing better sales trends at Pollo Tropical with comp sales that improved from high single-digit decline to low single-digit decline.

Taco Cabana sales trends admittedly were still soft, but this was expected since we had significantly reduced our promotional discounts and advertising for several months. However, we remain optimistic that the strategic renewal plan is taking hold as leading qualitative indicators that preceded improving sales trends at Pollo Tropical are now beginning to build at Taco Cabana. In our earnings press release, we laid out the significant accomplishments we have made so far across key elements of our strategic renewal plan.

We are working hard every day to fundamentally improve the guest experience and induce trial and increase frequency. Our guests, particularly in core markets, already have strong affinity for our brand and that, coupled with superior financial performance of these restaurants, is why we are focusing our efforts and investment in core markets first.

Strategically, we're in the process of repositioning our Pollo Tropical brand outside of our core markets beginning with locations in North Florida and the Atlanta metropolitan area. We are planning to regionalize the menu in stages, starting in the first quarter. We have recently completed research that validates the new products we are planning to roll out, including fried chicken options; side dishes like sweet potato, casserole and fried okra; and an extension of our desert line, potentially including peach cobbler and pecan pie.

Before I turn the call over to Danny, who in addition to serving as our company's COO, has recently taken on an additional role as Pollo Tropical President, I would like to welcome 3 accomplished executives to our Fiesta leadership team.

Chuck Locke was recently named Taco Cabana President. Chuck is highly respected in restaurant executive with more than 20 years of operations, development, marketing and finance experience. Before joining us, he served as Chief Operating Officer of Anthony’s Coal Fired Pizza, a polished casual dining concept based in South Florida. He is now just a few weeks into his new role and is already working hard to strengthen the implementation of our strategic renewal plan.

Tony Dinkins was recently named Senior Vice President of Human resources, overseeing our overall talent management strategy. Tony has 25 years of human resources experience working at leading organizations across multiple industries. Most recently he served as Senior Vice President of Human Resources at Cable & Wireless Communications.

Maria Chang Mayer will join us in just over a week. She will serve as our new General Counsel and Secretary, bringing to Fiesta an impressive breadth of legal experience. Our team members have the passion and resolve to implement our plan, and we believe their actions are going to fundamentally enhance our core business models and our performance as we enter 2018. I thank them for their efforts and commitment in overcoming some very real obstacles this past quarter, and know that they would agree with me when I say that we believe we are squarely on the right track.

With that, I'll turn the call over to Danny.

Thank you, Rich. I'd like to echo Rich's sentiments and express how proud I'm of our Pollo Tropical and Taco Cabana teams. Despite temporary setbacks brought on by the hurricanes, we believe we are reestablishing ourselves as a best-in-class operator, and in doing so, we're gaining traction with our guest. This is particularly evident at Pollo, where in physical ending November 6, estimated comparable restaurant sales were approximately flat, which included a positive impact due to lapping Hurricane Matthew that occurred last year, of approximately 3.4%.

We believe continued sale softness at Taco Cabana is in part the result of suspending promotional discounts and advertising earlier in the year as we implemented our plan initiatives. It will take time to build an expanded customer base at Taco Cabana. And under Chuck's leadership, we believe we will complete our brand relaunch by early next year.

Over the past 2 quarters, we have discussed the importance of high-quality natural ingredients and freshness with respect to our food and have used these guidelines to positively impact approximately 90% of our brand menus. We also leveraged our scale and purchasing power to vertically integrate Pollo Tropical's chicken supply chain. We now control the feed and breed of all chicken served in our restaurants, and we plan to be "no antibiotics ever" by next year. This will provide us with another means to differentiate our brand, especially outside of core markets.

Last month, we evolved our menus even further. On October 9 at Taco Cabana, we introduced 3 new flame-grilled chicken tacos with composed toppings for a limited time: Bacon jalapeno ranch, grilled peppers and onions with salsa roja and roasted poblano ranchero. We also enhanced our margaritas, which now feature Lunazul 100% Blue Agave Tequila. Over time, we see an opportunity to grow alcohol sales at the brand, which currently represent approximately 3% of sales, by encouraging greater patio use with special promotions and activities and enhancing our happy hour.

On October 16, at Pollo Tropical, we introduced a variety of new items. These include Guava BBQ Ribs, Grilled Chicken BLT sandwich, Pollo Bites Kids Meal and mango chicken salad. We further expanded and improved our side dishes choices, including Corn Casserole, French Fries, Mac & Cheese, Mashed Potatoes with Gravy and Coleslaw. In addition, we added to desert options with cheesecake, a signature key lime pie and chocolate chip cookies. Pollo also continues to feature a $12.99 family meal and $5.99 half chicken meal platter. Pollo Tropical's new freshly prepared menu offerings are being supported by a new TV, radio, billboard, point-of-purchase and social media advertising campaigns that launched on October 23 in both English and Spanish. Taco Cabana recently launched a new advertising campaign and resumed broadcast media to coincide with the introduction of the flame-grilled chicken fajita tacos. Both brands are putting in place refined positioning, marketing and digital strategies that will complement the new advertising campaigns. Through these communication platforms, we will convey our updated positioning and reinforce our brand equities across all consumer touch points. You can access our current TV spots on our company website.

Our Pollo Tropical restaurants in South Florida now feature new digital menu boards, and we will complete our installation of video menu boards in our Taco Cabana restaurants in San Antonio this month. We intend to have these in place across both systems by year-end. These menu boards enhance presentation of our menu and able us to display videos featuring our freshly prepared food being made in our kitchens and rotate day-part and promotional offerings among other benefits.

Turning to operations. We have been working on evolving our brand culture so that our teams will truly embrace our high standards for food quality, hospitality and restaurant environment. We have added regional chefs to the field structure to enhance food knowledge and culinary training, and ensure adherence to our operating and food safety standards. We are holding pre-shift meetings, which now include food sampling to ensure all our team members know and love our food and are familiar with current product promotions.

We have implemented new labor models at both brands. These models will ensure speed of service and accuracy, enhance hospitality, ensure that we are delivering consistently high-quality food. We have also optimized staffing, so that managers can be intensely focused on the guest experience.

We are reinforcing strict adherence to cleanliness, safety and food quality with line checks that are performed consistently throughout the day. We are addressing deferred maintenance need, both this year and in 2018, based upon a tiered list of priorities, and are enhancing signage and adding exterior lighting to improve visibility.

Turning to our restaurant portfolio. We opened 2 company-owned Pollo Tropical restaurants in Florida and 3 company-owned Taco Cabana restaurants in Texas during the third quarter. We also closed the 6 remaining Pollo Tropical restaurants and 4 Taco Cabana restaurants in Texas. Year-to-date, through the end of quarter 3, we have closed 40 restaurants, of which 36 were Pollos. We have 15 restaurant openings this year: 9 Pollo Tropical and 6 Taco Cabana restaurants and have opened all of these except for 1 Pollo Tropical restaurant.

To sum it up, much work has already been accomplished but there is still more to do. Our enthusiasm for our brands has been renewed through this plan and our team is extremely motivated by and proud of the positive changes taking shape in our restaurants.

Brand rejuvenation is certainly a process, but if we stick with what we are doing, we believe that our brands will provide the food and experience that our guests deserve, growth opportunities for our team members and value for our shareholders who have trusted us with their investment.

With that, let me turn the call over to Lynn to discuss our financial results.

Thank you, Danny. Comparable restaurant sales at Pollo decreased 10.9% in the third quarter of 2017, compared to a 1% decrease in the third quarter last year. This year's decline included a 13.1% decrease in comparable restaurant transactions, partially offset by a 2.2% increase in average check, of which 1.2% was attributable to menu price increases.

Comparable restaurant sales and transactions were negatively impacted approximately 5.5% to 6.5% by the hurricane. Sales cannibalization from new restaurants on existing restaurants negatively impacted comparable restaurant transactions by approximately 60 basis points.

Turning to Taco Cabana. Comparable restaurant sales in the third quarter decreased 12.6% compared to a 4.1% decrease in the third quarter last year. This year's decline included a 14.3% decrease in comparable restaurant transactions, offset by a 1.7% increase in average check due to pricing. Comparable restaurant sales and transactions were negatively impacted approximately 2% to 3% by Hurricane Harvey. In mid-October, we rolled out tiered menu pricing at both brands based upon a pricing elasticity analysis at the individual restaurant level that was completed during Q3. We believe the price changes will result in incremental, effective pricing of approximately 2% at each brand.

In terms of our key restaurant-level line items, we have highlighted our year-over-year variance explanations by brand and on a consolidated level in our 10-Q that will be issued this afternoon. We use restaurant-level adjusted EBITDA, a non-GAAP financial measure, as a supplemental measure to evaluate the performance and profitability of our restaurants in the aggregate, which is defined as adjusted EBITDA, excluding franchise royalty, revenues and fees, preopening costs and general and administrative expenses, including corporate-level general and administrative expenses.

At Pollo, third quarter restaurant-level adjusted EBITDA decreased by $6.5 million. We estimate that restaurant-level EBITDA was negatively impacted by hurricanes Harvey and Irma by approximately $3 million to $4 million. Restaurant-level adjusted EBITDA was also negatively impacted by a decline in restaurant sales, higher cost of sales as a percentage of restaurant sales and higher repair and maintenance costs, partially offset by the positive impact of closing unprofitable restaurants.

At Taco, third quarter restaurant-level adjusted EBITDA decreased by $5.7 million. We estimate that restaurant-level adjusted EBITDA was negatively impacted by Hurricane Harvey by $1 million to $1.5 million. Restaurant-level adjusted EBITDA was also negatively impacted by a decline in restaurant sales, higher cost of sales as a percentage of restaurant sales and higher restaurant wages and repair and maintenance costs, partially offset by lower advertising expenses of $1.6 million.

Please refer to our earnings release and 10-Q for all related non-GAAP reconciliation tables.

Now let's quickly go over charges recognized in the third quarter. We recognized additional impairment and other lease charges of $15.9 million, primarily related to 6 Pollo restaurant closures in September and additional Pollo and Taco restaurants that we continue to operate and other lease charges for restaurants closed during the quarter, partially offset by recoveries related to previously closed Pollo Tropical restaurants. We estimate that the cash impact of lease and other charges in 2017, related to all restaurants that have closed in 2016 and 2017, will be approximately $3.5 million to $4 million assuming ongoing lease, tax, utility and other obligations, net of payments received for lease terminations and assignments of $0.9 million.

Thus far, we have made good progress subleasing or terminating leases of our excess properties.

As previously disclosed, the 6 closed Pollo Tropical restaurants contributed approximately $3.7 million of restaurant sales and $1.2 million of pre-tax restaurant-level operating losses, including $0.6 million of depreciation expense to results for the 6 months ended July 2, 2017. In 2016, these restaurants contributed approximately $6.7 million of restaurant sales and $2.2 million of pre-tax restaurant-level operating losses, including $1 million of depreciation expense and $0.4 million of preopening costs to results in 2016.

Adjusted net income was $1.7 million or $0.06 per diluted share compared to adjusted net income of $8.1 million or $0.30 per diluted share in the prior year period. We utilize adjusted EBITDA, a non-GAAP financial measure, for the purpose of assessing performance and allocating resources to segments. This includes adjustments for significant items that management believes are related to strategic change and/or are not related to the ongoing operation of our restaurants, in addition to stock-based compensation, impairment and other lease charges and other expense income.

During the quarter, consolidated adjusted EBITDA declined 44.1% to $13.2 million, primarily driven by lower restaurant-level adjusted EBITDA at both brands, partially offset by lower G&A expenses, primarily as a result of lower Pollo Tropical regional administration costs related to restaurant closures.

For 2017, we continue to expect annual capital expenditures to be $60 million to $70 million, including $22 million to $25 million for development of new restaurants; $22 million to $26 million for ongoing and deferred capital maintenance; $13 million to $16 million for other corporate projects such as IT and systems projects and indoor video menu boards; and approximately $2 million to $3 million for remodeling costs. Next year, we expect to open 9 new company-owned Pollo Tropical restaurants in Florida and 7 new company-owned Taco Cabana restaurants in Texas.

The Taco Cabana restaurants will include 5 closed Pollo Tropical restaurants that will be converted. For 2018, annual capital expenditures are estimated to be $60 million to $68 million, including $26 million to $28 million for the development of new restaurants; $23 million to $25 million for the ongoing reinvestment in our Pollo Tropical and Taco Cabana restaurants, including approximately $11 million to $13 million in deferred maintenance needs, approximately $4 million to $6 million for restaurant remodeling costs and approximately $7 million to $9 million of other expenditures, which primarily include information technology and systems projects.

With momentum building at Pollo, leading indicators beginning to show promise at Taco and a full senior management team in place to implement our plan, we look forward to a successful 2018.

Thank you for your time this afternoon. And now Rich, Danny and I would be happy to answer any of your questions. Matt, please open up the line.

(Operator Instructions) Our first question is Nicole Miller from Piper Jaffray.

Just a couple quick questions. On the Pollo media reintroduction and the relaunch, are you getting the kind of improvement or bump, I guess, in comp, I'm not sure how to measure [it, that] is expected? And maybe within that question, if so or if not, could you share with us current trends that support that?

I would say, from the current media campaign that we have at Pollo, we're getting as we thought we would. Building awareness around the renewal is not something that is immediate, but we are seeing improvement in the trends. We see it in our sales. We see it in our check average, because that's the combination of the renewal plan as well as the message in the offer, which currently, at the moment, is a chicken and ribs combination offer. So that's part of for our strategy. So we see the lift in check, we see the lift improvement in transactions and then, clearly, in sales. But the awareness campaign will take time to really seed. We're just a few weeks into that media campaign around that message.

Is it fair to ask when you might get back into positive comp territory? And is it okay to model -- well, and I -- and if it's not, I'm totally okay with going on to my final last question. I -- because I get it, what's going on here. There's a lot of turnaround. Recovery going on -- and I guess, just in terms of modeling, do we -- can we start to look at 2-year comparison, just make modeling adjustments based on that? Or do you want to suggest something else to us?

What I would suggest, Nicole, is look at the year-over-year numbers that you're modeling and also, from our perspective, we're planning a build to momentum. So start more conservative in the beginning and then hopefully we are planning to see momentum build over time as guests are coming into the restaurants, they're experiencing a great atmosphere, improved food quality and better hospitality and coming back with more frequency.

And then, just my final question. As a team, like you said, very importantly, a fully formed team now, what are the pushes and pulls of running a 2-brand portfolio? What are the things you're learning from the strong field employee base that you have? And maybe what are the challenges that you see and things you would still want to work out?

Well, I can start and then -- it's Rich, and then, everybody else can jump in. We have a very strong now Fiesta team, with the expertise that will be able to bring it across the 2 brand lines. And that can be from human resources, food and beverage, legal, you name it -- marketing. We can now use those resources at the 2-brand level. At Pollo, we've got Danny. He's familiar with the Pollo. The Pollo team is in place and the Pollo team is excited, passionate and is achieving the results. The trajectory that we need to get to your first -- your earlier question, to not only breakeven, but to positive comp store sales. Chuck is new. Chuck spent the first 2 weeks in the kitchen. He learned all the food, specs, recipes, et cetera. I expect Chuck to have a significant impact. His operations background is significant. He's also a people's leader. He's a great leader, but the people not only respect him but like him. So I expect that working with us as a team, we will bring the same type of passion, and it's there at Taco, to get the same results that we're currently experiencing here at Pollo.

The one thing that I would add to that is that, this is -- the plan is grounded and confirmed in research, and there has been an extensive amount that has occurred for each brand. And we're nearing the completion of that research and it's taught us a lot, but it's also confirmed a lot about what we're doing. And so, that's a great guidepost for each brand. And as Rich said, sharing these resources and building these teams, it's really nice to see the plan come together and be confirmed.

And I would just finally add that there's collaboration right now among the management team to really deliver the plan that we've put in place. And everybody has a positive attitude in terms of what they think the future will hold and it feels great to be part of the team.

(Operator Instructions) Our next question comes from Nick Setyan from Wedbush Securities.

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I apologize, but I'm not really sure what's going on with our phones today. But you guys mentioned that October obviously was trending flat and you guys didn't launch the new ad campaign until the 23rd. So I guess, just revisiting that previous question, have you guys seen a little bit of a step-up from those flat trends? Or because you were going over maybe the hurricane from last year, there's a lot of volatility there?

I would say, there is the volatility around when we were lapping the hurricane from last year. But what we said earlier is, we were seeing results that were nearing where we're at today prior to the hurricane, so we feel like we've been building momentum. And now that we've -- we have advertising, we hope that, that momentum can continue and hopefully build from there.

And just one additional thought on that is, we're also comparing against a discount period from last year in terms of direct mail. So the comparisons are not quite apples-and-apples, but it's -- but we have seen progress.

Got it. And then, I mean, in kind of a more normalized environment, how should we think about, I guess, the reset, new level of margin profile of Pollo?

Well, that is a big question. I think we have a much healthier store base today, with a lot of the unprofitable stores having been closed, so the Pollo profile is certainly better in terms of sales. So I think we're running about $2.5 million in sales on an average basis. And then we're in the low 20s in terms of restaurant-level margins. And we were higher previously in our higher-performing restaurants; however, we've made investments in food and in labor and in maintenance, so we're seeing that impact on our margin.

Got it. So low 20%-ish. Makes sense. And then, just on G&A. Are we still tracking kind of in that sort of the high 50s range for the year?

We haven't specifically guided toward G&A, but as we've shared, we've absorbed some savings this year, we'll see a little bit of savings next year. So that, from a directional standpoint, seems appropriate.

Just because the Q3 G&A is so much lower than what we've seen, is that kind of the right way to think about it? Or are we going to see some stock comp volatility, et cetera, to maybe move that around?

Yes. We did see some stock comp impact this quarter just based on the timing of some of the grants that were issued. We also have lower bonus payments this year because of our current performance. So you'll want to take that into account as you think about next year.

Our next question is from Jon Tower from Wells Fargo.

Just couple follow-ups. First, on the new menu board, or new menu that you launched in October and the advertising that's coming along with it. Can you tell us how you think about the cadence of that advertising pulsing through the remainder of '17? And then, how you think about it into '18, perhaps maybe the weeks on air? And then, how you look at that versus 2017?

Well, let's say, it's a very good question. We are going to continue the advertising in a very pragmatic manner for the balance of the year. We'll have advertising in the month of November as well as some in December for this year. And then, next year, you would look for promotional windows of 6 to 7; and you would look for a strong presence of marketing and media throughout the state of Florida into Atlanta. But you'll also see us doing more with social and digital media in the days and months to come as we target some of these users that we feel provide us with some larger opportunities.

And I think on the menu board, it's much simpler. That's not my opinion, that's also our guest's opinion, to follow. It leads up with the things that we do well at, which is the family meal as well as the half chicken and quarter chicken. So -- and it also has the desserts. And it's early; early indications are that desserts are doing extremely well, primarily the new cheesecake as well as new the key lime pie. And that has increased our check average, which is not from price, it's primarily because of the add-on with the new sides that we talked about earlier as well as the new desserts that people are trying and liking.

Okay. But in terms of just thinking of '18, obviously 2017 was a very funky year for having to reset the media message and everything. But thinking about -- you cited 6 to 7 promo windows, I guess, maybe we'll get more guidance in February when you talk about full year '18 in more detail in terms of how to think about the cadence of advertising?

Yes, we will.

Okay, great. Then thinking about the new store growth for next year, I know you'd mentioned 6 -- or 9 stores for PT and then, about 7 stores for TC. So can you help us think about the cash-on-cash returns of these stores? And why even spend the money right now on opening these new stores when you're going through such a change and such a, frankly, a big turnaround at your existing asset base. Why even spend the money on the new stores when you really could focus a lot of time on the existing stores?

Yes. So right now we are targeting at least 30% return. So the stores that we're opening in 2018 are primarily in South Florida, which generate returns in excess of that number. And then, of the Taco Cabana new restaurants that will be opening, 5 of the 7 are conversions, which require a much lower investment amount -- and the conversions of a Pollo restaurant, much lower investment cost with which to open up a new Taco restaurant.

Okay, makes sense. And then, just lastly, I think you had mentioned earlier, and Rich, I think this was you, about potentially adding some new menu items in Atlanta, including stuff like peach cobbler and fried orca (sic) [okra]. I think that's correct?

Okra. Okra.

Okra, sorry. There we go. And I was just curious, the research is probably leading you this way, but what about the idea of having customer confusion from those that go from state to state? I mean, is there an issue with the brand potentially meaning one thing in market being not that far away from another market?

Clearly, our research has showed us, in using one of the major research firms that are in the restaurant industry, that the menu differentiation by geographic area is the way to go -- the way we need to go. This was done by research of both internal guests as well as our nonexternal guests, but I'll answer it another way. The one item that we're looking at is fried chicken, and people have already said rich fried chicken. But this will be our marinated chicken. It's not going to taste like some of our competitor's fried chicken. And it will not -- in the beginning, we're testing, it'll not be a bone-in, it'll be a boneless breast. So we're still keeping the core of Pollo Tropical. You'll still have the flavor from the marination that we have throughout the chain. It's some of the side items that we're doing and some of the one-off items that are more local, giving the -- our users the ability to try something else in addition to just your typical bone-in whole chicken, quarter chicken, half chicken with the rice and beans. So we're not changing the essence and core of Pollo, we're just bringing the outside of it to more a localized brand.

So thinking about the menu, say, if you were to put a percentage on it, what would be consistent across the 2 markets, say 60% of the menu -- or not 2 markets, but the different markets. Would it be 60% of the menu or so, consistent across geographies?

Yes, across the geographies, the consistency would be 75%, in that range, with the menu flexibility of up to 25%.

This concludes our question-and-answer session. I'd like to turn the floor back over to management for any closing comments.

We'd like to thank everyone for their interest and their investment in the company, and thank you very much for participating on the call today.

This concludes today's teleconference. Thank you, again, for your participation. You may disconnect your lines at this time.