Gray Media Inc (GTN.A) 2017 Q3 法說會逐字稿

Good day, ladies and gentlemen, and thank you for standing by. Welcome to the Gray Television third-quarter 2017 earnings conference call. Today's conference is being recorded.

At this time, I'd like to turn the conference over to Mr. Hilton Howell, President and Chief Executive Officer. Please go ahead, sir.

Thank you, operator, and good morning, everyone. Thank you for joining Gray Television's third-quarter 2017 earnings call. As usual, I'm joined today by our Chief Legal and Development Officer, Kevin Latek; and our Chief Financial Officer, Jim Ryan. We will begin this morning with a brief disclaimer that Kevin will provide.

Thank you, Hilton. Good morning, everyone. Certain matters discussed on this call may include forward-looking statements regarding, among other things, future operating results. Those statements are subject to a number of risks and uncertainties. Actual results in the future could differ from those described in the forward-looking statements as a result of various important factors. Such factors have been set forth in the Company's most recent reports filed with the SEC and included in today's earnings release. The Company undertakes no obligation to update these forward-looking statements.

Gray uses its website as a key source of Company information. The website address is www.gray.tv. We will post an audio recording and a transcript of this call to our website.

Included on the call will be a discussion of non-GAAP financial measures, and in particular, broadcast cash flow, broadcast cash flow less corporate expenses, operating cash flow, free cash flow, and certain leverage ratios. These metrics are not meant to replace GAAP measurements but are provided as supplements to assist the public in their analysis and valuation of our Company. We include reconciliations to the non-GAAP financial measures to the GAAP measures in our financial (technical difficulty) that are made available on our website.

Now I return the microphone to Hilton.

Thank you, Kevin. We are thrilled to welcome you to another earnings call about our recently completed quarter with record revenue and record net income. As you saw from our release this morning, our total advertising revenue for the third quarter was at the high end of our guidance range. A stronger-than-expected political advertisement environment allowed us to comfortably exceed the high end of our guidance for political revenue as well.

For the third quarter, we posted fully diluted net income per share of $0.21 a share. The quarter finished better than expected, and we are going into the fourth quarter with a great deal of momentum.

It was four years ago this week that we announced our acquisition of the Yellowstone television stations. That was our first acquisition in seven years, and it was the start of an extraordinary streak. Over the past four years, we have completed 23 acquisition transactions and three divestiture transactions. After more than $1.5 billion in acquisitions in less than four years, we expanded our footprint by a total of 51 television stations in 31 television markets, including 26 new television markets.

We also, at the same time, brought our net leverage down considerably. We closed the third quarter of 2017 with our total leverage ratio, net of all cash, at 4.99 times on a trailing eight-quarter basis. And without any significant deals, we are on track to be well under the 3s by late 2018.

By comparison, this ratio stood at 5.52 times at the end of the third quarter of 2016.

A few weeks ago, Gray reached another milestone. On October 2, CBS and Gray jointly announced a multi-year deal that renews all the Gray's CBS station affiliation agreements that otherwise would have expired at various times over the next couple of years. These agreements cover all 32 DMAs in which Gray owns and operates its 39 CBS affiliated television stations. Our CBS portfolio ranges from Knoxville, Tennessee, to North Platte, Nebraska, and collectively includes approximately 5.9 million television households.

Our new long-term agreement with CBS, along with other long-term affiliation renewals announced by some of our peers recently, serves to confirm that the broadcast network affiliate relation continues to be, and will continue to be, the best content distribution partnership in existence.

Looking forward, this month will finally bring regulatory relief from the FCC. You know, it simply incredible that the FCC imposed the one-to-a-market rule that still governs midsized and small television markets before the bombing of Pearl Harbor. No one can sincerely dispute that the world has changed considerably in the past few years, let alone in the last 76 years. We are grateful that the FCC finally will begin to take some long overdue steps that [promote] local stations to take the steps necessary to be competitive in the world in which we live.

We also welcome the imminent approval by the FCC to the ATSC 3.0 broadcast standard. By granting broadcasters the freedom to evolve technically, the FCC enables us to embrace a new standard that it should open new opportunities for broadcasters as well as new and better ways to serve our viewers and customers.

Finally, we are now less than 100 days away from Super Bowl LI and the Winter Olympics. As you know, Gray owns 29 NBC television stations, which skew towards our larger markets. We are always thrilled to host a Super Bowl and the Olympics. America's love for sports has not waned, and that was just proven again with the passionate viewership we saw for this year's World Series. We are therefore quite excited about the sales prospects for hosting both of these major events on our strong NBC stations beginning next February.

As always, we appreciate your support for Gray Television as we continue to build for the future.

At this point, I will turn the call over to Kevin Latek, and then to Jim Ryan. And after their remarks, we will open the line for questions. Kevin?

Good morning again. As you know, we have several hundred retransmission consent agreement expiring this quarter. Those agreements represent about 58% of our total Big 4 subscriber universe. Historically these negotiations tend to pick up around the same time as holiday shopping, and we do not expect that timing to change this year. Nevertheless, we have concluded a small handful of retransmission negotiations, and we are very pleased with the results.

It is clear that we no longer need to explain how broadcasters, and our stations in our particular, deliver the most value to pay-TV operators and deserve to be compensated accordingly. This retransmission cycle will move us closer to our goals. We are certainly encouraged from the early returns of what will be a long and busy season.

Next year is also looking to be good political year. 65% of our markets will see a Senate race next year; 81% of our markets will have a governor's race; and, of course, 100% of our markets will see at least one House race next year.

While we are not providing guidance on political revenue for 2018, we can tell you that we see many reasons to be optimistic. First, we believe that the struggles within both the Republican and the Democratic parties that are playing out in public will lead to more contested primary races at all levels of government. Indeed, the Federal Election Commission has received a record number of candidates filing for next year's midterm federal elections.

Second, we are encouraged by political ad revenue this year. Issue and candidate spending throughout 2017 have been stronger than we have seen in recent off years, and the spending is not limited to the very few elections that take place in 2017. Rather, we are already seeing notable spending for next year's gubernatorial and congressional races, more than one year out from Election Day 2018.

On a combined historical basis, political revenue for the first three quarters of 2017 is 14% ahead of the comparable period in 2015. Importantly, this very strong growth came despite the fact that we did not receive any of the quite significant Iowa and New Hampshire presidential primary money that our stations collected in 2015.

One final source of optimism is that we continue to see growth in our already leading share of political ad spending. As you know, we faced some doubts two years ago when we announced that we would bring national sales, which includes most political revenue, in-house instead of using third-party rep agencies. A year ago, we told you that we saw growth in our political revenue shares in 2016 versus 2014. You see that same trend this off-year. Specifically, third-party revenue audits in 31 of our markets show that our share of the total political ad dollars in these markets grew from 46% through the first three quarters of 2015 to just over 49% for the comparable period this year.

It can be difficult to push share when you are already taking nearly half of all the markets' political revenue. We therefore are especially thrilled that our excellent sales staff managed to grow share and to grow share so significantly.

We cannot know at this time how the 2018 political ad market will turn out. Nevertheless, we have good reasons to be optimistic about the market as a whole and about our ability to capitalize on candidate and issue spending over the next 12 months. Thank you for your time.

I turn the call now to Jim Ryan.

Thank you, Kevin. Good morning, everyone. Our earnings release and 10-Q will be filed today. Also with the earnings release filing, we have updated our combined historical basis select operating results through the third quarter of 2017, and that's available also on our website at www.gray.tv.

A few brief comments on Q3 and the year to date. We knew we had very difficult comps going against the $8.2 million of ad revenue associated with the 2016 Olympic Game telecasts. We were pleased with our overall Q3 core local and national results, which were up 3% on a combined historical basis, excluding the $8.2 million of the Olympic ad revenue. And I'd remind everybody that of that $8.2 million, $6 million was local and $2.2 million was national.

As we discussed on our last call, our Q3 national revenue benefited significantly from a large MVPD spending in our markets to support product roll-out. They were up about $900,000 in the quarter. We were very pleased to see that. Unfortunately, that spend and that roll-out doesn't look like it will be continuing. They started Q4 last year, and it looks like it ran through Q3 this year. But we were pleased to get that additional spend in our communications segment during the third quarter.

Kevin already commented upon our audited share our markets' political revenue. Expanding on that, our aggregate local and national market shares for the 31 markets we have independent audits for both the third quarter and year-to-date results, has consistently been in a share range in the very high 30s to 40%, and that's been consistent since 2015. We are very pleased with that very strong market share growth in core local -- share percentages in local and national over a multi-year basis.

We're also very pleased that our leverage ratio, net of all cash at September 30, was a record low 4.99 times. As we have commented before, we expect that the leverage ratio by December of this year will be even lower, somewhere in the high 4s.

A few comments on our fourth quarter. While an off-year for political revenue, we are very pleased that our Q4 political is expected to raise between $5 million and $5.5 million. As Kevin was commenting about the strength of the off-year races, actually our expectations for Q4 political revenue have increased by a full $1 million in just this past week, reflecting last-minute buys as we head into Election Day tomorrow. We think the overall results for 2017 bodes very well for 2018.

As far as our core growth goes in local and national, we expect low-single-digit percentage growth in aggregate local and national revenue. Actually, if you break it down by categories and look over the course of the year, we are very pleased. Except for communications, which I've already mentioned; and auto, which I'll get to in a minute; all other categories were in the green and pacing positive, including ones that have lagged all year, such as retail and fast food from time to time. So we are very pleased with the overall trends.

Auto currently is pacing slightly down at about minus 1.5%. But it's actually been improving consistently, week after week, for the last four weeks, so we are cautiously optimistic that our Q4 auto might finish stronger if there's additional ad buying for the year-end holiday season. As we commented on our last call, we believe the relative softness in auto reflects many of our local dealers modestly adjusting their ad spend in the near term as they adjust to their respective, slightly lower SAAR rates.

Our Q4 combined historical expense growth of plus $4 million to plus $7 million is entirely attributable to the $6 million growth in reverse comp, which was anticipated.

Two other items to note in fourth-quarter expenses. First of all, we will be making a discretionary contribution to our 401(k) plan of $4.1 million. That's a fourth-quarter event, and the number is consistent with the same number from last year.

The other expense to note in Q4 broadcast expense is that it is increasing by about $2.6 million in non-cash stock comp to reflect a total non-cash stock comp of $2.9 million. And that reflects stock grant awards given to non-executive management employees in October of 2017. And again, that's a non-cash charge.

At this point, I'll turn the call back to Hilton.

Thank you, Jim. And, operator, at this time, I'd like to open up the call to any questions that anyone may have.

(Operator Instructions). Aaron Watts, Deutsche Bank.

You talked about the FCC and some of the changes that are going to be coming down the pipe, or presumably might be coming down the pipe. You have very strong positions in the markets you already play in. So as you think about the opportunity going forward, do you see a greater opportunity to increase your presence or enhance your existing portfolio in existing markets? Or do you see more consolidation to grow your national footprint?

This is Hilton. So, Aaron, let me start and then I'll let Kevin follow up with that. One of the things that people may or may not realize about Gray Television is that we already operate an average of 3.9 streams in each of our markets. That's an average. And so we feel we know that we already have the benefits of really strong duopoly operations in our markets. That doesn't mean to say that there are a great deal more opportunities that we will have within our existing markets. But we're going to continue to look at other transactions to grow a broader scale throughout the United States.

Things have been relatively slow on the M&A front. We finished [forced] acquisitions at the beginning of this year, and haven't had a lot to follow up with it after that. But we expect things to pick up fairly rapidly after the FCC comes to a final conclusion on their rules. And it is our intention to take advantage of that whenever we have an appropriate and a financially appropriate opportunity to do so.

I'd also like to say that Gray is always looking at broader transactions and potentially broader opportunities to dramatically increase the scale and coverage of the television company that we're currently run -- or running.

Kevin, do you have anything else?

No. The only thing I would add, Aaron, is, as you know, we are -- try to be patient yet opportunistic. So we don't have a preference for one particular type of transaction, a new market versus in-market. Rather, we look at everything on its own. And if it's a transaction that is good for our shareholders and at an appropriate price, we'll pursue it, whether that means it's adding another Big 4 to our current stable or going into a new market. Everything stands on its own.

Okay, great. Thanks for the thoughts.

Dan Kurnos, Benchmark Company.

Kevin, I don't want to be reading the tea leaves too much here. I know you guys are not giving retrans guidance for next year, but can you just help us think about your thought process? Doing CBS early was, I think -- it came as a positive surprise to most of us. And I think a lot of us are thinking you guys must have either increased confidence in your ability to get the numbers that you want, knowing that CBS is fixed annual. So, can you just help us with your thought process on that front as we head into this big renewal period for you?

Sure. CBS and NBC are our two biggest partners by far. We have more CBS affiliates than NBC, but the NBCs tend to be in larger markets. They are both extremely important to us. In 2014, we had a group of stations that were coming up for renewal. And we struck a deal with CBS that I believe at the time was the first network group deal where a broadcaster renewed not just what was on its plate with a network at that time, but all of its affiliates across the platform, regardless of when they expired. And at that time, we had some stations that were already under contract to go out to 2018 and 2019.

But we did, in fact, then took that model and went to ABC, NBC, Fox, and CW and did the exact same thing, so we would have visibility in kicking these end dates out as far as we could. This year we approached CBS, frankly, early on. Again, it's a very important relationship. And we had a couple CBS contracts that were not on our 2019 expiration because of acquisitions. And we wanted to get those extended to 2019, and we thought it made sense to discuss our larger relationship with CBS; what we deliver for them, what they deliver for us; and find a path to not just taking the new stations out to 2019, but taking all of our stations out to the end of 2021.

I think a testament to our relationship with CBS and the stations that we have and the ratings that we deliver is that CBS was willing to, again, not just renew a couple deals, but renew all of them with us, and take us out a couple more years.

So, there's a lot of things that we talk about in these affiliation agreements. Term is incredibly important. Rate is incredibly important. But there's a lot of other items in there that also I think reflected our close relationship with them, and how much we value them and they value us. So all in all, I think it's a very positive announcement for us.

And you're right: as we go into this retrans cycle, we certainly have visibility now on all of our CBS affiliates through this entire cycle and beyond.

Can you just then maybe just give us a sense on what it means for net retrans, your thoughts going forward? And then shifting over to the OTT side, whether or not you are starting to see OTT penetration in some of your smaller markets, and if you are getting any of the MVPD money yet.

On retrans, you all know CBS has a flat fee, and it has since it started charging retrans -- started charging programming fees from its affiliates many, many years ago. So what that net retrans margin will be depends entirely on what our gross is. And since we have 58% of our base up now and a little bit more the year after, I can't tell you what our gross is going to be on our CBS with any certainty in the future years; therefore, I can't calculate the margin.

I think we remain comfortable that this is a long-term partnership that works well between us and CBS. And I continue to feel very strongly about retrans, as we talked about many times. There is a significant runway ahead of broadcasters on getting paid, what we should be getting paid.

In terms of OTT, we -- level-set here -- when DISH and DIRECT started local signals 17 years ago, they started off in the top 10 markets and then they moved to the top 20 and 30 markets. It took DISH Network about 10 years to get down to the smallest markets in the country. DIRECTV has never launched the last 11 or so markets in the country.

The OTT guys are trying to do what DIRECT and DISH did in the course of about two years, and technologically that's quite a challenge. They have -- we have seen Hulu, Sony, and YouTube launch our markets this year. Sony it was in there, actually, last year in a couple places here and there. But they have rolled out, I think, all or virtually all of our markets already. Hulu started up very, very end of this second quarter. They launched a market here or there. And YouTube launched the first of our markets just a few weeks ago.

So we are certainly at the bleeding edge of what that looks like. It will be some number of months before we get subscriber reports and payments that gives us a lot of visibility. What we've seen so far -- and again, the very early returns is, yes, there are certainly subscribers; but it is an infinitesimal number, as you would expect, given that they are just rolling out and they're trying to do a lot of things at the same time, launch in lots of markets at once.

So it will be a little time before we see those sub numbers, I think, with any kind of -- give us any kind of insight into what may become of these OTT providers.

All right, got it. Thanks, Kevin.

Kyle Evans, Stephens.

A fairly nondescript press release in a very small market; but curious on dropping Fox in Fairbanks, if there's any kind of follow-on implications from that.

Kyle, I would not read into it. And Fairbanks is an incredibly small market. It's DMA 202 out of 210. In markets that size, you're talking about almost an apartment building in New York City. And we are trying to eke out a business there. So we have the dominant NBC station, and a close Fox -- I mean, a close CBS station in that market. We have a share between the two of them that is -- I don't have the numbers in front of me, but I'd be shocked if it wasn't north of 90%.

So in order to make money with anything else in that market is extremely difficult. That Fox station, for us, was marginal. We have owned Fairbanks for about nine months. We have put a lot of effort into seeing if we couldn't turn that around. And it got to the point where we've concluded it was not worth any more of our investment.

So at the end of the day, since we're trying to make money even in little markets, it did not make sense to continue to have a Fox affiliate and put the time and effort into a channel that was not doing well, to say the least.

As you saw from the press release, or trade press coverage, another broadcaster as a repeater station up there; repeats all of the signal out of Anchorage with no employees or local programming, community service up there. So the programming will continue to be available on the station, but again, it's just the Anchorage station.

We flipped the programming out there -- the Fox hours, we're two hours a day, and so that's now MyNetwork. The rest of the syndicated content we have is still there. But -- and to go back to -- we have already with the NBC and the CBS, probably 90% share. And for that matter, it might even be more. There is just so few sales up there that we are going to the repeater station of Anchorage already. So, I wouldn't read into it. It's the tick on the tail of a dog, if you will; not even the tail wagging the dog.

Okay, thanks for that. You have high-50% renewing from -- at the end of this year with the MVPDs. Your latest deck shows very low singles renewal for 2018. Could you give us some view as to 2019 and 2020 on (multiple speakers)?

All of our contracts are on a three-year, cycle, so if you take the numbers and add three, you'll see our cycle going forward.

Okay. And lastly, we've had some difference in the data coming in on the sub counts. Could you give us any more granularity on what you're seeing in your retrans sub count numbers?

We have said for some time, there seems to be a bit of -- a little bit of erosion, but certainly nothing that gives us concern. We have not adjusted our retrans guidance for this year. You can see our retrans from quarter to quarter is pretty stable. And I don't really have much more to say than that. All we can do is point to the numbers in our deck. Our retrans numbers are stable, quarter to quarter.

Great. Thank you.

Marci Ryvicker, Wells Fargo.

Just wanted to talk a little bit about auto. Jim, at what point could you expect to see an inflection if auto is, in fact, going to get better? Is it around the Thanksgiving holiday? Is it the Christmas holiday?

I would anticipate it is probably more the Christmas holiday. There's -- depending on the year, there is often a little uptick in -- especially that week between Christmas and New Year's. So that would be one week I would be looking for. But in general, the -- call it post-Thanksgiving, the Christmas season, we'll see if there's some add-ons and if the local guys step it up a little bit.

Overall, like you said, it's a little soft, but we're not really troubled by it. We don't see anything alarming. Just as we said in our last call, as we go through and look account by account, it's not wholesale dropping out. It's the little guys taking a little bit off the table. And so it's a lot of small dollars that just add up to a little bit of softness, is what it is looking like to us.

Okay. And then I don't know if you have had some time to do this, or have done the analysis. But any sense as to what the incremental is from political at this point? I know that we used to talk about 50% being incremental as a rule of thumb. And I guess the same thing can be asked about Olympics: do you have any sense as to what is actually incremental?

On the Olympics, to be honest, we're not sure. It's very hard to try to get the that. I think in 2016 it was much more incremental than we appreciated at the time.

To put it in perspective, obviously in August you would expect our NBCs year-over-year would be down, and they were. Our non-NBCs -- and they were down mid-20s, just as you would expect -- because $8.2 million went away, or the best part of it. Our non-NBCs in the month of August, core were up a healthy 4%. So that suggests to me that that Olympics sales from last year were much more incremental than we probably have been used to in the past.

Political is also extremely difficult. Yes, there was that old rule of thumb of 50-50. I'm not sure anymore if that holds. And especially in super-hot markets, I think it weights more towards incremental, simply because the pricing gets to be extreme and we get the advantage for that.

Got it. Thank you very much.

Barry Lucas, Gabelli & Company.

I was hoping just to stay on the political theme for a minute. If you could remind us what the baseline for 2014 would be on a historical combined basis.

Yes, Barry. Give me half a second to -- I want to say it was -- in 2014, it was $143 million. That's combined historical for 2014. And as we have talked about several times on multiple calls, there was probably $25 million of activity between a Senate race and some ballot initiatives in Alaska that year. And Alaska is dead quiet in 2018, so you can factor that in to whatever extent you think it needs to be factored in.

Okay.

As Kevin mentioned, we have a very good slate of Senate and governor's races in 2018, and we do think it will be a good year.

Okay. And maybe for Kevin, I don't want to beat the sub count to death, but you did add a -- I guess you completed CAX in August. If you look at retrans in Q2 and Q3 on a same-station basis, even if it was nominal, was the third quarter down, flat, or up on retrans?

On a combined historical basis, it was -- in Q3, it was --

$70.2 million.

Yes, it was $70.2 million in Q3. Our guidance for Q4 says, quote, $70 million, because we don't usually round it to the hundred thousands. And I'd have to look up Q2. Q2 is $70 million, rounded. Q1 was $70 million rounded. So it's been very consistent, using the combined historical numbers, which would factor the acquisition from the beginning of the respective years.

Okay. Thanks for clearing that up. I appreciate it.

Davis Hebert, Wells Fargo.

I just wanted to come back to the leverage commentary made earlier. I couldn't quite understand the trajectory in 2018. I thought I heard into the 3s or under the 3s. Maybe if you could just provide some clarification on the glidepath to leverage.

(multiple speakers) into the 3s, Davis.

Into the 3s?

Into the 3s, yes.

By the end of 2018?

Conservatively, by the end of 2018, I would expect to be -- again, conservatively, at 1 full turn lower. So if we're somewhere in the high 4s this year, at the end of this year, it would be into the 3s by the end of next year.

And then, depending on how we do ultimately on the large retrans reset that we have at the end of this year, as well as how well we do on political -- and again, we do believe it is going to be a strong year, but we're not going to put a number out there yet -- it could be better. So if I say high 3s, I'm deliberately being conservative, because we've got two big pieces of the puzzle that we won't know for some time yet.

Okay, that's good to hear. So that's on a two-year average basis, correct?

That's correct.

Okay. Helpful. Thank you.

(Operator Instructions). Jim Goss, Barrington Research.

I have a couple of questions. One, CBS has discussed the notion that it actually fares a little better if an MVPD sub switches to its OTT service. And I know your involvement in the OTT service is going to be different from theirs. But I'm wondering, once it gets rolling, would you say you are at least neutral if somebody switched and went to OTT, or possibly better? Or are you harmed?

Jim, we've said we're generally agnostic as to where the subscriber is coming in.

Okay, so neither way. Then I was wondering, too, if you are looking at the programming charge versus retransmission fees, does your market size make any difference? Does it make it easier or harder to maintain a positive net trend in retrans, less reverse comp?

I don't know how to answer that question relative to our peers because we're not -- we don't see what they see. And again, we're in 10% of the US in midsized, small markets; so I don't know how our experience compares to folks who are in bigger markets in terms of maintaining their rate. I know -- we know our experience, but I don't know what their experience would be. So I can't compare, unfortunately.

Okay. And maybe lastly, if M&A does begin to pick up, are you likely to be trending to larger markets as a focus? Or do you think you want to stay in the sweet spot that you've been so good at over the years?

Sure. It goes back to, why do you rob the bank? That's where the money's at. And for the last four years, since we started this little acquisition run, we have looked at stations in all market sizes. But there has only been one number-one TV station offered for sale in the top 30 markets in the last four years. And while we did participate in that process, the price became too high. And as we've always said, we are only doing deals that are accretive for our shareholders. So we did not pursue that.

If we did that, I think we clearly would have a station in the top 30 that otherwise met our criteria being a number-one station. But don't take away that we've only been buying stations in mid-sized markets, that that's all we're interested in. That's where the opportunity set is at. There's just -- if you look at the top 50 markets, there's only one or two left that are not already owned by a large group.

In the bottom markets, 100 to 210, there are still scores of stations that are number-one or a strong number-two. They are not owned by a group. So there's just much -- the field is much richer outside of the larger markets.

We have looked at, and we will continue to look at stations that meet our criteria, regardless of market size. And if we can afford it and are comfortable with our ability to run it, we will pursue stations in larger markets. Again, it comes back to the qualification: if we can afford it. And that's -- time will tell what those opportunities might be.

All right. Thanks very much. Appreciate it.

(Operator Instructions). And it appears there are no further questions in queue.

I'd like to turn it back over to today's speakers for any additional or closing remarks.

Well, thank you very much, operator. I just want to thank everyone for your time this morning. And we look forward to bringing you up to date at our next call when we cover all of this prior year. Thank you.

Ladies and gentlemen, this does conclude today's conference. Thank you for your participation. You may now disconnect.