Summit Hotel Properties Inc (INN) 2010 Q4 法說會逐字稿

Good day, ladies and gentlemen, and welcome to the Fourth Quarter 2010 Summit Hotel Properties Earning Conference Call. My name is Modesta and I will be your coordinator for today. At this time, all participants are in a listen-only mode. Later we will conduct a question and answer session.

(Operator Instructions)

As a reminder, this conference is being recorded for replay purposes. I would now like to turn the conference over to your host for today, Mr. Dan Boyum, head of Investor Relations. Please proceed, sir.

Thank you, Modesta. Good morning, everyone. Welcome to the Summit Hotel Properties first investor conference call since our February 14, 2011 IPO.

Last evening we released full-year 2010 results for our predecessor company, Summit Hotel Properties LLC. I hope you've had a chance to review the press release. It does include pro-forma data as well. If you did not receive a copy please call my office at 605-361-9566, extension 4084 and I'd be happy to mail a copy to your email a copy.

You also can view a copy of the release at our company's website at www.shpreit.com, just click on the investor relations icon and you'll see the press release heading on the right side of the page. A replay of this conference call will be available today after 12 PM Eastern time at either our company's website, or you may call 888-286-8010, reference number is 89576998.

A replay will available through April 14, 2011. The conference call is the property of Summit Hotel Properties and any redistribution, retransmission or rebroadcast of this call in any form without the express written consent of Summit Hotel Properties is prohibited.

In compliance with the SEC's Safe Harbor guidelines, certain statements that might be made during today's conference call could be considered forward-looking subject to certain risks that could cause results to differ materially from those projected.

Those statements may include, but are not limited to, estimates of the Company's future revenue, earnings, operations and development activity. I will refer to our company's SEC fillings for further information on the factors that could cause actual results to differ from any estimates.

In accordance with Regulation G, any non-GAAP financial measure used in our company's oral presentation today is required to be reconciled to the most directly comparable GAAP measure.

Kerry Boekelheide, Executive Chairman of the Board; Dan Hansen, President and Chief Executive Officer; and, Stu Becker, the Executive Vice President and Chief Financial Officer, are going to provide you with some insight into our predecessor company's 2010 actual and pro-forma results. They'll also discuss recent events since our IPO.

It is my pleasure to introduce to you this morning the Executive Chairman of the Board, Kerry Boekelheide.

Thank you, Dan, and good morning, everyone, and welcome again to our first conference call. One of our goals is always to maintain open two-way communications with our investment community. We value greatly the relationships we've developed with our investors over the years and pride ourselves on the transparency of our operation.

After we completed our IPO in February of this year we have filed a 10-K for our predecessor company for the year 2010. Our press release last night also included pro-forma information.

Because of timing issues, we were unable to provide this information before our IPO because the results through the third quarter of 2010 was the latest information we had available. We trust this historical and pro-forma data helps you to better understand our company and its value.

Dan Hansen will shortly bring you up to date on the REIT's activity since our IPO including three acquisitions that we have under purchase agreement. Stu Becker will provide you some financial highlights from our predecessor company, and an update on our balance sheet and our pending credit facilities.

We'll get you right to it, and I'd like to introduce my partner, Dan Hansen, President and CEO.

Thanks, Kerry. At the time of the IPO we had two assets under LOI that were a result of our sourcing agreement with Intercontinental Hotels. Shortly thereafter we added a third property and all three are under purchase agreements. We accelerated our due diligence and anticipate the closing of these transactions by the end of April which is earlier than anticipated.

We expect all three to be immediately accretive to earnings. We have a purchase agreement for the 121 room Staybridge suites in suburban Denver for $83,000 a key and for the 143 Holiday Inn in a northern suburb of Atlanta for $49,000 a key.

The Denver Staybridge was built in 2001, and will undergo a renovation estimated at $2.6 million. And the Atlanta Holiday Inn was built in 2004, is in terrific shape, and will undergo a relatively minor renovation estimated to be $300,000. The Holiday Inn is also currently completing a lobby renovation to incorporate the brand's new prototype social hub concept.

The third property is the 91-room Homewood Suites by Hilton in the Ridgeland suburb of Jackson Mississippi. We are purchasing this for $80,000 per key. This property was built in 1997. It's in terrific shape, it will require some renovation, about $800,000 and it will be our fourth property in that market.

It's literally right next door to our Residence Inn and a half a block away from our Staybridge Suites. We see this getting us even better visibility and into managing the rate and the occupancy of this cluster of hotels, and expect to achieve additional economies to scale and marketing power.

We continue to see significant deal flow from a variety of sources and see many opportunities for acquisitions in the top 50 MSAs, and some selected markets outside the top 50.

On the operational front the transition to IHR or Interstate Hotels has gone very smoothly. We've not experienced any turnover with managers, and we've recently agreed to merge our purchasing with theirs to achieve some additional savings.

You've probably read about it in our 8-K filing and some sources that we are no longer a franchisee of Choice Hotels. We are working with other franchise companies for conversions, but due to pending arbitration we really can't comment much on that issue today. We do expect to have better visibility on this issue in the future.

As in any conversion we'd expect some short-term occupancy weakness from the transition out of these properties. Rest assured we are focused on making the right decision for our shareholders.

We've begun renovations on several of our seasoned hotels, and we believe the assets that we have chosen give us the greatest impact from these capital improvements and we see minor disruption from this deployment of capital as well.

And with that, I'd like to turn it to Stu Becker, our CFO to highlight the year-end numbers of our predecessor, our recent RevPAR numbers and to provide an update on our credit facility.

Thanks, Dan. The 10-K we filed last night provides detailed financial information for our predecessor company, Summit Hotel Properties LLC. Our press release provides updated pro-forma financial information from the third quarter of 2010 through year-end 2010 based on assumptions and adjustments. Here's a run-down of the numbers.

The 2010 revenues for our 65 hotels was $135.6 million, that's an increase of 11.9% over 2009. EBITDA was $32.8 million, an increase of 25.7%. EBITDA margin was 24.2%. That's a 123 basis point improvement from the previous year. Adjusted EBITDA was $39.3 million, that's up 224 basis points.

Now keep in mind that EBITDA and adjusted EBITDA for 2010 do not reflect approximately $1.1 million of non-recurring expenses relating to the IPO and work on year end. Again, I want to emphasize the supplement to our release provides pro-forma information for both 2009 and 2010. Information I just provided was on the predecessor company.

As some of you may know, we classify the 65 hotels in our portfolio as 46 seasoned and 19 unseasoned hotels. The 19 unseasoned hotels were built either after 2007 or have brand conversions since 2008. We plan to continue to differentiate these properties through 2011.

Summarizing our RevPAR for 2010, RevPAR for our seasoned portfolio is essentially flat, and our unseasoned properties showed a RevPAR increase of 13.6% for the year. That's a blended year over year increase of 3.1%. We anticipate oversized growth for unseasoned portfolio throughout 2011.

I also want to take this opportunity to share some more recent figures with you. The February, 2011 year over year RevPAR growth for our seasoned portfolio is 4.2%. The unseasoned portfolio is up 18.2%. That's an overall increase of 9% year to date through February.

We're in the midst of negotiations on a $100 million line of credit and we expect to have that facility in place by early April. In the meantime we have arranged a $30 million unsecured credit facility to fund near-term acquisitions until the $100 million line of credit is completed. That summarizes our performance and credit profile.

I'll turn the call back to our Executive Chairman, Kerry Boekelheide.

Thanks, Stu. Thanks, Dan. And thank you all again for being on the call today. Now that you've had an opportunity to share our overview of our company, I will ask our operator to open the lines up for the question and answer session.

(Operator Instructions)

Our first question today comes from the line of Chris Woronka with Deutsche Bank. Please proceed.

Chris, your line is open, did you have a question? Okay, your next question comes from the line of David Loeb with Robert W. Baird. Please proceed.

Good morning, gentlemen. Dan, I wonder if we could just start on the acquisitions that you've announced. Can you give us an idea about your expected returns on those either trailing or forward looking?

Sure. I guess we'll start with the Denver Staybridge Suites. We look at that purchase with renovation costs it's about a 10.3% cap. The Holiday Inn with the minor renovation that they have it's a 12% cap, and the Homewood Suites with the renovation is also a 12% cap. And that's on a next 12 months basis.

Is that next 12 months starting after the renovation, or from the day you buy them?

After the renovation. You're not going to hold me to those 12 caps on the forward basis, are you?

That was my next question, you said your pipeline is robust. What kind of expectations do you have for returns on the stuff in the pipeline?

You know, we still see a lot of opportunities for growth between the 8% to 10% cap range. For the foreseeable future you'd probably see more between 9% and 10% and 8% and 9%, but whatever possible we'll get the best deal that's more accretive. And these first few we think are exceptionally attractive.

Based on what IHG released it looked like the two IHG properties have a trailing return of about 9.5%. Is that right? And, is the Homewood kind of consistent with that on a trailing basis?

Yes, that's fair.

Okay. And when you say robust, can you give us some idea about kind of the universe that you're looking at and how many assets you're considering? What you think you might -- I guess obviously the constraint here is going to be capital availability, but can you give us an idea about how you think acquisitions might be completed over the next six to 12 months?

You know, we're going to be real thoughtful how we deploy capital. We have no shortage of deals to look at. There's still a little bit of disconnect between sellers and us as a buyer.

I think there was a little bit of a perception that once the IPO was done we would be a savior for some of these assets and while we are a great source, we're certainly not going to overpay. So, there are continuing to be more and more CapEx requirements coming due and the gap between the owners and sellers, not just for us but for everybody continues to narrow.

We are looking at several dozen acquisitions right now, lining those up and not just based on going in gap rates but also on total performance. But you could expect kind of that 8% to 10% cap rate to be the sweet spot where we continue to play.

Okay, that makes perfect sense. I have to ask you about Choice, and I apologize because I know you said you weren't able to say much more, but what's your long-term vision? Do you want to be a Choice franchisee? How do you think this plays out, and what impact do you think it has on those hotels over the long run?

You know, Choice has been a great partner of ours for a lot of years and I don't think anybody is happy that it's come to this. We give them a lot of credit for helping us build this company from its inception. Our plan for growth as we've outlined is upscale and upper mid-scale and to the extent we find those opportunities, we're a little bit brand agnostic.

So, beyond that there's really not a lot more we can say. I think we'll have some more visibility soon, but at this point we're still committed to the same thing we discussed on the road-show and the same conversations we've had with our investors, which is to put the best brand on each hotel we own in each market.

And it's not so much an issue about Choice, it's just our philosophy of making sure we create the greatest amount of value for our shareholders.

Well -- and sorry to keep going on this, but to kind of turn that around do you think rebranded that there's a substantial potential for increased cash flow from some of these hotels? And I know in particular that the Cambrias have been underperformers.

I mean, I think in reference to a couple of the assets that we had identified I'd say that's a fair assessment.

Okay, I won't hammer home any more. That's all for now. I'll come back at the end if I have more questions.

Thanks, David.

The next question today comes from the line of [Dennis Forst] with KeyBanc, please proceed.

Actually before I even ask my question I wanted a clarification on one of David's. You talked about the three acquisitions being somewhere in the 9.5% trailing cap rate?

Correct.

Okay. Is that before renovation costs?

Yes.

That's just on the purchase price for those three properties?

Correct.

Okay, great. And secondly then, management -- who will manage those properties for you, has that been decided?

Yes consistent with our clustering strategy we've asked Interstate to take the Homewood Suites in Ridgeland, the suburb of Jackson. They already run three hotels for us there.

And the two assets that were owned by IHG they're going to continue to manage the Gwinnett property which is North Atlanta. That's one of their flagship properties and they're actually completing the lobby conversion for us. And on the Denver Staybridge Suites, Interstate is going to be managing that one as well.

Okay, terrific. And then the question for Stu, just a clarification on the February or two-month RevPAR numbers. Stu, did you say that the 4.2% seasoned 18.2% unseasoned, that's for two months, that's not just for February.

That is correct. That's year to date.

Year to date. Okay. So, we can extrapolate the February numbers by looking at the January numbers that were in the free writing prospectus?

That is correct.

Okay, great, thanks. Keep up the good work.

Your next question comes from the Michael Salinsky with RBC Capital Markets, please proceed.

Good morning, gentlemen.

Hi, Mike.

Hey, Dan, first question you talked about a robust pipeline, can you just the numbers around that? How many deals are you looking at and also I'd just be curious to see where you're seeing the greatest competition from assets now kind of in the upscale and upper mid-scale space at this point?

I'll address where we're seeing competition. We really aren't seeing any competition. We're still I think one of the few players out there with capital which gives us a strategic advantage.

We weren't in competition with any of our peers. In Ridgeland, the first two acquisitions were part of the sourcing agreement, and we have several others that were in negotiations with the seller that there are no other buyers.

So I won't say that we won't have competition, I think great assets and great markets will, at some point, get some attention but it's our focus to just make sure we're thoughtful and forward thinking about strategically identifying those opportunities as we've done with the Homewood Suites in Ridgeland.

On a pure numbers basis, I mean, I think there is -- we've had several hundred acquisitions that have been forwarded to us. I wouldn't say that those are all acquisitions that we're digging into. There was a great initial flurry upon IPO. A lot of stuff that had been listed that have just recently been unlisted, stuff that was going to come to market soon, that everybody kind of threw at us quick to kind of test the waters.

And we've remained true to our underwriting criteria which is we're looking for a 9% cap on the next 12 months projections -- conservative projections. And as we look out we see that pipeline further narrowing. And the top 50 MSAs obviously are focused selectively outside, but I think you could narrow that several hundred universe down to probably 25 to maybe 30 real deals where we're digging into it and doing the work on.

That's helpful. At most of them, one-off or are you seeing a lot more portfolio opportunities (inaudible)?

Most of those are one-off and maybe pairs -- a couple that there might be three. I think we're going to probably avoid any activity with any larger portfolios. I think our message out on the road show to our investors and to the analyst community was we're going to deploy our capital with the best assets try to stay right down the middle of the fairway with the great cap rates, great upside and great brands.

And while a portfolio purchase would certainly make sense at some point you know inevitably when you buy a portfolio you end up with one or two assets you'd just as soon not have. So, at this point, we want to make sure we use our capital as best as possible, execute on our strategy.

Stu, not to leave you out here, I got a couple of questions for you. As it is April 1st today, can you give us a thought on what is the trends are for March there? I know --

That is an April Fool -- an April 1st question, huh Mike? That's loaded. I would certainly say that relative to -- through February, we have been on budget. We have seen a little softening in March, but I think we're still going to be close on budget.

I would let everybody know that the way our portfolio of 65 hotels today operates. We tend to be -- the second and third quarter are the larger part of our revenue, tends to be -- the markets we're in tend to be a little bit more summer-based. So, we expect that that would be a step up in revenue and performance as we get into the summer months.

(Inaudible)

The other thing I would say is we had an exceptionally strong March last year. So, March over March numbers wont be -- I wouldn't expect them to be as robust as January and February, but we haven't changed our outlook. We're still confident in our view.

Okay. Second, that the RevPAR number of 9% you guys gave there through February, what's the mix of rate versus occupancy and growth on that? Just trying to gauge kind of how that's going through on a quarterly basis.

Yes. So, on the February year to date, occupancy is up 2.5%. ADR is up 6.4%. And I don't know if you want that broken out by seasoned and unseasoned. But that's as total.

That's pretty much helpful I think kind of walking through there. And then, finally, just curious on the CapEx plans. I mean, in the press release, you talked about spending $20 million.

I am assuming that you don't want to be doing a lot of renovations during the second and third quarter as you kind of talked about being your more elevated quarters there. Just kind of walk us through a little bit about how you expect to -- the timing on those renovations.

Yes. That's a good point, Mike. We've let the market know that we'll spend, we think, probably $20 million over the next 18 months. But your point is exactly right. The reason we say over 18 months rather than just saying over the next year is we are -- we want to be cautious to put the capital to work at the right time of the year.

So, we have some markets that we will be doing work -- starting work here and working through this second quarter. And then, there'll probably be more activity as you head towards the latter half of the year and into the first part of next year. I don't the exact breakdown of when we expect to deploy those. But that's kind of a sequence that you might expect.

And your point is well-taken, we'll be cautious on the second and third quarter when we deploy because those tend to be the best time of year for some of our markets. I mean, as an example, we have two properties in Scottsdale. We'll do some work on Scottsdale.

So, it's reasonable to assume that we'll start that work in sort of a May-June timeframe, because that's a soft time of the year for that property. Whereas, if we are working on a property that is more summer-driven, we'll wait until the fall or over the winter to do that work.

Okay. That's all for me, guys. Thanks.

We do have just a quick follow up. You know we do have several properties that despite some disruption we feel that there is significant rate upside by doing the renovation, so we're going to go ahead and move aggressively now in some of those markets.

You know in Bellevue, Washington, for example. Spokane, where we've got properties that we think would benefit significantly from immediate deployment of the capital. So, again, we're trying to be thoughtful about we spend it to get the greatest value and get a consistent schedule going on a go-forward basis.

All right. Ladies and gentlemen, your next question today, which is our final question before we reach follow ups, comes from the line of Dan Donlan with Janney Capital Markets. Please press star one to admit your first question.

Mr. Donlan, please proceed.

Thank you and good morning.

Good morning, Dan.

Just first question, I guess, for Stu. The $30 million unsecured line that you guys have temporarily, how much is outstanding on that right now, roughly?

We did an advance of $5 million on that.

Okay. So, not much at all.

No. And it's really -- we said we've got some acquisitions sort of in play and we're putting some money dollars down relative to those transactions.

Okay. Can you maybe talk about -- and sorry if I missed this -- could you maybe talk about pricing on the new facility and where you think that could come out at?

Yes. We expect the -- I guess, I don't know if you're referring to the $30 million; but, essentially, we'll roll into the $100 million once we're complete with the work. And like I said, I think we're in a couple of weeks of executing on that line of credit.

But we think that that's competitive with the market. It'll be a tiered pricing relative to leverage and some other covenants. But we would expect that our all-in rate probably coming out will be in the 4% range.

Okay. All right. And then, I guess, Dan, if you could talk about you know the two acquisitions that your source agreement with IHG you said trailing -- you talked about trailing 12 being a roughly 9.5% cap. Where do you think that would've been if these were marketed deals and brokered deals?

You know that is a tough question, Dan. With really no buyers out there, I think they are priced fair.

Okay. All right.

I think IHG got a fair value of what they could've received. We got them at a price that is accretive to our portfolio. And I think that it's a great starting point for what we hope will be a relationship that we can both benefit from.

Okay. And then, could you talk a little bit about margins on a going forward basis? I know you guys didn't really provide guidance. But it looks like you guys came out at about at hotel level, EBITDA margins are about 28.6%. Is that about right?

Yes. I would note to you -- recall we've done some one time expenses that we were impacted at year end associated with the pre-IPO work. So, I think you can factor that in as probably margin compression in '10 that probably that won't be an issue going forward. So, I would probably adjust that thinking up a little bit.

Okay.

And then, I think if you look forward as we were talking about a little earlier on RevPAR, we really do see that in 2011 and '12 both that we'll see -- from a RevPAR growth, we think its going to be focused on rate than it is occupancy; whereas, in 2010, it was a little bit more of an occupancy play.

So, with that, I think the additional revenue that we're going to generate -- we expect to generate over the next couple of years, will have better flow through to it. And so, if that helps a little bit, without giving guidance, we certainly think that the hotel EBITDA growth we saw this year that's -- we would hope to at least double that next year, from a percentage growth.

Okay. All right. And then, lastly, one on Choice. Assuming this all goes away, how soon do you think you could get a new flag potentially on let's say the Comfort Inns and then the Comfort Inn and Suites and then also then on the Cambria? Are we talking a couple weeks for the Choice -- for the Comfort Inns or -- and a couple of months for the Cambria? Is there any timeframe you can potentially give us?

You know post resolution on this, if we had to convert all the hotels, it would vary by hotel. And I think your assessment is right. It's probably two to four weeks for a Comfort Inn or Comfort Suites and a little bit longer for a Cambria Suites.

But, again, that's predicated on if all the franchises remain terminated and also which brands we convert them to. Some take a little more time than others. Obviously, it's not a quick process, but it's not something that is new to us. We've done it before, and feel we can execute it in a timely fashion.

Okay. And then, I guess, the last question, on the sales front, is there any type of -- are you guys marketing anything for sale right now? Or, is there anything that you're thinking about potentially selling in the next 12 months?

You know we look at our whole portfolio twice a year -- sometimes, more often and underwrite it just like we would an acquisition and make sure that these markets and assets that we want to maintain long term.

You know typically, this is a time that we start to evaluate each acquisition and -- each hotel in our portfolio rather, to look at how accretive it's going to be, whether it needs capital, and if it's going to be strategic going forward.

As Stu pointed out, we do get a larger portion of our earnings in the second and third quarter. So, we're not inclined to sell stuff in the peak earnings months. But there are several assets in our portfolio that have been in a potential sale category. As we review different options for conversion, as we review use of capital, and now that we have acquisitions, we can weigh the use of that capital on some renovations versus buying new properties.

So, nothing that we have out there formally listed, but something could come up and we certainly wouldn't want anybody to be surprised. Because consistent with our strategy, it is making sure we have the best assets growing with -- in the best markets.

Okay. That's it for me. Thanks.

Your next question is a follow up from the line of Dennis Forst with KeyBanc. Please proceed.

Yes. Hi. Thanks for taking the second question. I just wanted a little quick clarification on the March comment. You said it was a little soft, then you went to say you had a very difficult comparison.

So was the softness entirely due to the tough comparison, or did you see a little softness? I doubt whether there's much correlation between what you're seeing and what Marriott was seeing overall, but I think Marriott had the same type of comment about March.

Yes. I can't really comment on the comparison to Marriott. I haven't studied it real in-depth. But, for -- if you remember back to March of last year, that was kind of the wake up call for the industry, where everybody had a really good March and I think that was the thing that finally helped everybody believe that the downturn was over.

And so, I think, for our portfolio it was a great month last March as well. So, my point was really that our growth and our continued growth is not inconsistent. But on a month over month basis, it won't appear as robust.

Okay. It's more of the comparison rather than any change of trend between January, February and March.

Correct.

Okay. And then, lastly, do you have an idea when you'll report first quarter earnings, just putting together my calendar. I assume it will be around the first May or so?

Yes. We'll try to be thoughtful about getting out there and not being in line with everybody else. So, probably be a little bit later than that. I would guess, at this point, maybe this second week.

Terrific. Okay. Thanks a lot for everything.

Sure.

Our final question today is the follow-up from the line of David Loeb with Robert W. Baird. Please proceed.

I have a couple of follow-ups for Stu. Stu, first on the line, I just want to make sure I understood correctly. The $30 million line, essentially, you're saying that becomes replaced by the $100 million, so the total capacity of the new line you're expecting to be $100 million?

That is correct.

Okay. Are there any material changes from your initial term sheet in terms of what that line is going to look like?

You know, I would say, no material changes. We think we've sharpened the pencil a little bit on some of the cost -- or the pricing of it, but materially the same.

And, I guess, two more pieces of that. Does it -- is it likely to have an accordion feature, and how easy is that going to be to expand --?

Yes, a good question. We've actually started communication with some other syndicates to have them potentially join our facility at some point. We're starting that process.

I think we'll come out with an accordion that would -- say, $200 million and that would be our kind of target over the next year or two of need for capital to make acquisitions. So, kind of expect that window.

That's dependent on finding other banks to join in.

That is correct.

Okay. That makes perfect sense. And I have another one about that. I know -- I remember. The facility that the covenants that guide the availability, does that have some kind of look back for acquisitions, so when you added an acquisition --?

Yes. So the facility would look at trailing 12 is the kind of typical guideline for an amount that could be advanced and have the coverage there. But on acquisitions, we'll use trailing 12 acquisition EBITDA as a guide for additional EBITDA value and for our covenants, it will be included on a trailing 12 basis.

Great, okay. And the second topic was on the February year-to-date. I would like the seasoned and unseasoned breakout if you've got that.

Okay, very good. On the seasoned portfolio year-to-date on a -- recall that RevPAR was 4.2%. It's made up of -- occupancy is actually off 2.9% and ADR is up 7.4%. And then on the unseasoned recall, 18.2% is the RevPAR. It's made up of occupancy up 12.8% and the ADR up 4.8%.

And recall that mix of seasoned and unseasoned. We're still stabilizing some of those unseasoned portfolios, so it tends to be driven a little bit more for occupancy. But we do think it's more of a rate impact for most of the balance for the year.

Terrific. That's very helpful. Thank you, very much.

Thank you.

Ladies and gentlemen, I would now like to turn the call back over to Mr. Kerry Boekelheide for closing remarks. Please proceed, sir.

Thank you. And thanks everyone in our organization for your hard work in getting everything ready for this first call. I also wanted to thank all the analysts that follow us. I appreciate their hard work.

And I also want to thank our new shareholders. It was great meeting all of you on the road show. And I definitely want to thank our old shareholders and not meaning old in age, but shareholders that have been with me for a long in the Company. I appreciate your continuing support, and glad you participated in the call today.

We look forward to another visit in the near future when we can report our next quarterly earnings to all of you.

Thanks, everyone.

Thank you.

Ladies and gentlemen, that concludes today's conference. Thank you for your participation. You may now disconnect. Have a great day.

Thank you.