Innodata Inc (INOD) 2016 Q2 法說會逐字稿

Good morning and welcome to the Innodata second-quarter 2016 earnings call. Today's conference is being recorded. At this time, I would like to turn the conference over to Ms. Amy Agress. Please go ahead, man.

Thank you Emily. Good morning everyone. Thank you for joining us today. Our speakers today are Jack Abuhoff, Chairman and CEO of Innodata, and O'Neil Nalavadi, our CFO. We'll hear from O'Neil first, who will provide a detailed review of our results for the second quarter, and then Jack will follow with additional perspective about the business. We will then take your questions.

First, let me qualify the forward-looking statements that are made during the call. These statements are based largely on our current expectations and are subject to a number of risks and uncertainties, including without limitation that contracts may be terminated by clients, projected or committed volumes of work may not materialize, our Innodata Advanced Data Solution segment, IADS, is a venture that has incurred losses since inception and has reported impairment charges for all of its fixed assets. We currently intend to continue to invest in IADS. The primarily (technical difficulty) nature of contracts with our digital data solutions clients and the ability of these clients to reduce, delay or cancel projects, continuing digital data solutions (technical difficulty) revenue concentration in a limited number of clients, inability to replace projects that are completed, canceled or reduced, depressed market conditions, changes in external market factors, the ability and willingness of our clients and prospective clients to execute business plans which give rise to requirements for our services, difficulty in integrating and deriving synergies from acquisitions, joint ventures and strategic investments, potential undiscovered liabilities of companies that we may acquire, changes in our business or growth strategy, the emergence of new or growing competitors, various other competitive and technological factors, and other risks and uncertainties indicated from time to time in our filings with the Securities and Exchange Commission. We undertake no obligation to update forward-looking information, and actual results could differ materially. Thank you.

I will now turn the call over to O'Neil.

Thank you Amy. Good morning everyone. Thank you for joining us today to review our financial results for the second quarter 2016.

Before we get into reviewing the financial performance, I wanted to discuss a couple of key items. First is the strategic acquisition of the Agility business from PR Newswire for $4.3 million. We are excited about the acquisition as the combined products of MediaMiser and Agility will position us well to meet the growing demand for owned media and measuring impact as well as media intelligence.

Jack will discuss our strategy in greater detail later in this call.

On a pro forma basis for calendar year 2015, Agility had $5 million in subscription revenues with an approximate gross margin profitability of 50%, and in the most recent second quarter April to June 2016, it was EBITDA positive. The acquisition should double the annual revenues of our media intelligence business to approximately $10 million with a gross margin profitability of 50% before acquisition related amortization costs. Our combined media intelligence business will now have more than 1,500 customers.

Moving now to our financial performance for the second quarter, this quarter's results were impacted by $1.4 million in one-time expenses. That reduced our adjusted EBITDA for the quarter from a $700,000 gain to a $700,000 loss. The one-time expenses consist of professional fees and related costs of $1.25 million in connection with the previously reported internal investigation by the audit committee, and (technical difficulty) and other expenses of $150,000 for the Agility acquisition.

As reported earlier, the investigation relates to potentially improper payments made by certain employees of one of our foreign subsidiaries. These expenses were incurred in our digital data solutions segment, formerly known as content services, and approximately $1.1 million was counted as SG&A expense and $150,000 as cost of goods sold. The one-time expense of $150,000 for Agility acquisition was accounted for as SG&A expense in the media intelligence segment.

My remarks on comparative results for Q2 will exclude the effect of the one-time expenses as I will indicate. I will now review the key line items in our financial statements on a sequential quarter-to-quarter basis.

Total revenue for the second quarter was $15.6 million compared to $15.7 million last quarter. On a segment basis, digital data solutions revenues were lower by $400,000 this quarter at approximately $13.2 million. This was primarily due to an $800,000 decline in revenues from our key e-book customer, offset by a $450,000 increase in revenues from other customers.

In IADS, both Synodex and docGenix reported growth with total revenues increasing by $270,000 to approximately $1.2 million. In our media intelligence business, revenues expanded by approximately $100,000, or 8%, to $1.25 million this quarter. The number of MediaMiser enterprise customers increased by one to 126 at the end of Q2 as a result of seven new additions and six terminations.

Our consolidated gross margins were $4.2 million this quarter, or 27% of revenues, compared to 28% of revenues in the prior quarter. As previously indicated, this excludes the effect of one-time expenses and acquisition related amortization expenses.

At the segment level, again excluding one-time expenses, the gross margin in our digital leader solutions business was $3.7 million, or 28% of revenues, compared to $4.2 million, or 31% of revenues, in the prior quarter. Our margins were lower primarily due to lower revenues of $400,000, and cost increases of $150,000 attributable to salary (technical difficulty).

In IADS, higher revenues helped to reduce the deficit between revenues and cost of sales to near breakeven compared to a deficit of $300,000 last quarter. And in our media intelligence business, gross margins, excluding one-time expenses and acquisition related amortization expenses, increased to $600,000, or 48% of revenues, this quarter compared to $450,000, or 39% of revenues, in the first quarter.

Drilling down, our total selling, general, and administrative expenses, excluding the one-time expenses, increased by $500,000 to $4.3 million compared to $3.8 million. This increase is attributable to a $400,000 increase in our digital data solutions business, and $120,000 in our media intelligence business. SG&A expenses in digital data solutions were $3 million this quarter, and a $400,000 increase was on account of new hires in sales and marketing of $150,000 and the balance due to miscellaneous adjustments which reduced our costs in the first quarter by $250,000.

In IADS, we maintained the spend at $350,000 in both quarters. And in media intelligence segment, our (technical difficulty) increased by $120,000 to $900,000. The additional spend was primarily for new hires in anticipation of the Agility acquisition, plus regular annual salary raises.

Moving down to pretax earnings -- pretax losses, excluding one-time expenses, were $200,000 this quarter compared to pretax earnings of $400,000 in the previous quarter. Lower gross margins of $100,000 and higher SG&A expenses of $500,000 contributed to the $600,000 decline in pretax earnings.

Let me now review our adjusted EBITDA. Our adjusted EBITDA, excluding one-time expenses, was $700,000 compared to $1.4 million in the last quarter. This EBITDA of $700,000 was the net result of $1.4 million adjusted EBITDA in digital data solutions offset by a $400,000 loss in IADS, and a $300,000 loss in our media intelligence segment. As I indicated earlier, the one-time expenses of $1.4 million reduced our adjusted EBITDA to a loss of $700,000.

Moving over to net earnings, income tax and profits earned by our offshore subsidiaries was $300,000 this quarter compared to $500,000 last quarter. After deducting tax expenses and minority interest, our net loss after one-time expenses was $1.8 million this quarter compared to break even in the previous quarter.

Our cash and investments decreased by approximately $400,000 to $24.9 million at the end of Q2. Approximately 15% of the funds were held in the US, and the rest were held overseas.

We continue to sustain our US cash balances by deferring cash transfers to our operating subsidiaries. In the second quarter, this deferral on a proportionate basis resulted in a deemed $500,000 dividend income for US tax purposes.

Looking ahead, we expect our cash balances at the end of the third quarter will be in the range of $19 million to $20 million after reflecting payments for the Agility acquisition and the accrued one-time expenses.

Our capital expenditures this quarter were $700,000 compared to $150,000 in the previous quarter. And next quarter, we expect CapEx to be in the range of $400,000 to $500,000.

I will now turn to our foreign exchange earning programs and other items. At the end of the second quarter, we had approximately $19 million in outstanding forward contracts to hedge our overseas exposure for expenses and revenues. In Q2, the US dollar moved in a narrow range against Philippine peso, the Indian rupee and the euro, and it depreciated 7% against the Canadian dollar. Based on mark-to-market, our forward contract may now show gains of $100,000.

Before I provide the revenue guidance, we wanted to provide some indication of one-time expenses that we will be incurring in the third quarter. We expect to incur up to $225,000 for the completion of a previously reported internal investigation and about $300,000 for merging MediaMiser and Agility operations.

Let me now review our revenue guidance for the third quarter. We expect the revenues to be in the range of $15.7 million to $16.8 million. The segment-wise breakdown is digital data solutions in the range of $12.5 million to $13.1 million, IADS between $1.2 million and $1.3 million, and media intelligence, including Agility, between $2 million and $2.4 million. Based on the date we closed Agility, we anticipate approximately $800,000 to $1.1 million of Agility revenue will be recognized by Innodata in the third quarter.

Thank you, and I will pass the call over to Jack.

Thank you O'Neil. (technical difficulty) update you on where we are in the IADS segment and in our core digital data solutions business.

So, as you know, over the past few years, we have been executing on a strategy to build new products and services that expand our market opportunity and our base of recurring revenue, products and services that help customers gain better insights or otherwise improve their businesses using digital data, and that leverage our own core competencies.

Our acquisition of the Agility business from PRN was another cornerstone in this strategy. Agility is a tool used by PR and corporate communications professionals for identifying journalists and bloggers who would likely have an interest in a particular story, distributing the story to the identified journalists and bloggers, and then monitoring and measuring the media's uptake. Agility was created by PR Newswire to accelerate its growth in a market environment in which traditional newswire business was basically flat.

Agility is regarded as one of a handful of leading global media contact databases out there in the market. The analysis firm Burton-Taylor lists four leading products that combined enjoy close to 70% of the market spend in the Americas, and about 40% of the market spend in Europe, the Middle East and Africa combined. And they estimate the global spent for media contact management in 2013 at $288 million, up 9.5% from the prior year, and the market for the associated media monitoring to be approximately $870 million, growing 3% year-over-year.

Because there are apparently only a handful of global media database products out there, and as a result of recent acquisitions (technical difficulty) radio owned three of them. The US Department of Justice and the UK Competition and Markets Authority expressed concern that the acquisition of PR Newswire by Cision could lessen competition in the US and UK markets. So these regulators conditioned their approval of Cision's acquisition of PR Newswire with a requirement that PR Newswire sell Agility to a buyer that these regulators approved of.

So, over the past several months, we first negotiated a deal with Cision and PR Newswire to buy the Agility business. And we then made detailed presentations to the UK and US regulators to demonstrate our plans for being a viable competitor in the media intelligence business. The regulators approved of us as the purchaser of PR Newswire's global media contact database and monitoring business, and they approved Cision as the purchaser of PR Newswire's press release distribution business and other assets.

The Agility business is approximately 700 customers in the UK and approximately 800 customers in the US. In 2015, its revenues were approximately $5 million. We paid $4.3 million for the acquisition, which we funded from our internal cash reserves. We think we did well with the acquisition since recent comps in the market are in the range of two to three times revenues, albeit these comps are for larger businesses.

Now, here's why PR and corporate communications professionals need our media intelligence products. If you are a PR or a corporate communications professional, either within a PR department at a company or within an agency, you've got two problems. The first problem you are fighting is information overload. There's just so much news getting served today and every, day thanks largely to advances in information technology, that it's hard for you to get your story noticed. The second problem you've got is social media. You have to earn your social media mentions, and the people who are the key social media influencers are constantly changing. Therefore, sophisticated players in PR and corporate communications increasingly need tools to help them identify both the journalists and the bloggers who will have an interest in covering their story, and will then distribute their story directly to these folks.

Simply sending a story out over the wire is no longer enough to gain media pick-up. Then you also need to monitor the news to see how the story that you have pitched got picked up and otherwise amplified, and you need analysis tools and services to interpret all of the data.

Last year, we succeeded at growing MediaMiser by 27% year-over-year, measured in constant currency. We competed favorably to win business from government agencies like Canada Post, and companies like GE and McDonald's.

Now, with Agility, we think we will be even stronger. Agility and MediaMiser products fit well together. MediaMiser primarily competes in the North American market for editorially enriched media monitoring services. Agility primarily competes in the UK and North American markets for automated technology-driven monitoring services, and within its greater database, can contact management solution.

MediaMiser and Agility address different customers and different needs. MediaMiser's best prospects are large Fortune 1000 clients have a committed budget for editorially and enriched media monitoring. Meanwhile, Agility is best positioned to meet the demands in an expanding universe of companies that are recognizing the importance of monitoring and distribution. We think that, by coming together, we will be in a position to build on our relative strength, to establish a focused, differentiated strategy that enables us to win in the marketplace, and to infuse our efforts with the kind of entrepreneurism that will make us a strong competitor.

For us, the main execution risk in the deal will be around the need to augment the US and UK sales teams and regeneration sufficiently to make up for the loss of PRN's common sales channel. There's also some technical integration work that will need to manage over the next several months which we are working on now. Over the next several weeks and months, we will be working with our new Agility colleagues on our near-term integration plans and on medium and long-term product and go-to-market plans.

I'll now shift to our IADS, or Innodata advanced data solutions, segment and specifically to our Synodex business. We've made some good progress on our Synodex business since our last call. First, we signed a new significant client. The client will start using our services with limited rollout, which for us will mean an initial run rate of approximately $600,000 per year with the potential to then be expanded once successful. The client is one of the top 10 life insurers processing multiple types of insurance risk, and sees using our service as a potentially important benefit in dealing with new demands placed on its operations as a result of growth. This is one of the deals I mentioned in our last call as being a likely 2Q close.

We also made important forward progress with another very large client that we signed late in the fourth quarter. In the beginning of June, we started off our new Synodex 4.0 product with small volumes as we collaborated with them on an almost daily basis to validate the customizations that they required. We completed the customizations about a week ago and the client has expressed to us that they are very happy with how it's now come out. Houston is now beginning to expand with another organization.

In addition to the product customizations and in order to accommodate potentially significant volumes, the client required that we set up a second failover processing site. In order to accommodate them, we developed another Synodex processing location within our [Sabu] facility, and just last week the client completed its information security assessment of the Sabu operation resulting in a thumbs up. The client will now start conducting its live testing stage business case evaluation to measure the potential impact of the product within their business. Getting this client to this stage has been an important milestone, first because the client's requirements are potentially very large, potentially several million dollars per year, but also because the client is known throughout the industry for both the particularly complex work that it does, and its high standards.

Last quarter, I told you that we were hoping to start work with two other clients, but unfortunately both of these have been delayed. One was delayed because the chief underwriter unexpectedly quit right after all the remaining issues on our contract were ironed out, so are going to need to pick up the process with his successor. The other was delay due to the client's internal IT staffing issues that were preventing them from completing the internal programming work necessary for our systems to exchange data.

Now, with respect to the second delayed client, we received word just this week that they got the programming done and that they are ready to start testing the network communications between our systems. The second is the larger and more important of the two engagements, fortunately.

A few other updates. In the last call, I mentioned to you that another existing client was considering a significant expansion to our services. Their evaluation is continuing.

I also mentioned on our last call that we had demoed our 4.0 product to five client prospects and that we would be demoing to others through May and June. The results of these activities are encouraging. Of the five potential clients that I told you we had demoed 4.0 to, one reasonably large client wants to begin trials this summer. Another was the client I referred to earlier whose chief underwriter quit. We will engage with his replacement once he has been named. With another we will be continuing discussions. And two have said that they will be ready to engage with us this fall.

In May and June, we had good meetings as well with 11 different companies. Three of these companies actually reached out to us to set up meetings based on what they had heard about the 4.0 product. Two of the companies are using traditional summary providers but are dissatisfied and they think our solution is going to be a better fit for them.

We've been seeing that a number of companies are struggling operationally with increases in product demand and revenue, and we are continuing to see that companies are intrigued by the prospect of a data-driven solution like ours which supports the ability to then automate aspects of underwriting using the data.

The headwinds to adoption main bureaucracy, either in terms of decision-making or IT staff allocation, and incremental approaches to change. One of our recent prospects told us to "expect a marathon, not a sprint" in terms of getting started with them. They explained that they like to start small, score wins with senior executives and then continue to build up. But we feel that, with a winning product that is now being adopted by industry bellwethers, we will have what it takes to capture these headwinds. And of course what lies on the other side for us is proving indeed to be long-term recurring revenue.

Since our last call, we've also made progress in the docGenix business, increasing revenues from a large sell side client as well as the new sell-side client that we won late in Q4 last year.

IADS revenue in the quarter was up from $900,000 to $1.2 million and we expect this segment to continue to post sequential gains through the year.

I'll now turn to our digital data solutions segment. Revenue in this segment was $13.2 million, which was $400,000 lower than we posted in the first quarter, as a result of lower volumes in the quarter from a key book client. We anticipated these lower volumes in the guidance we provided last quarter.

As we continue to discuss, the quarter-to-quarter ups and downs that result from both volume fluctuations and project completions are something that we are strategically addressing with the new businesses in which we are investing. Our media intelligence businesses, MediaMiser and Agility, both have subscription-based revenues with a track record of high customer renewals, and Synodex has mostly recurring revenue.

In the digital data solutions business, there are several important strategies that we are working on. As I mentioned on our last call, we've hired new leadership for this segment and we've rolled out a new account management organization that will service our existing accounts, putting our sales team to sell net new business. We have added four new client partners to our account management organization so far this year, three external hires, and one internal transfer.

We will also be broadening our strategy to address not only publishers and information companies but also data-driven enterprises. For that reason, we changed the name of this segment from content services to digital data solutions.

We've expanded our R&D efforts to support both our information company clients and our enterprise clients, and we've expanded our marketing team to help us navigate the market opportunities that we are seeing. For example, this quarter, we started working with a large bank that sought our help in building its internal data repositories and another company that we are helping manage a large internal database. We will be looking to offset these investments to the extent possible with savings in other areas of the business.

Looking at the Company overall this quarter, apart from the $1.4 million one-time expenses mentioned by O'Neil, our EBITDA was adversely affected by $400,000 of gestational costs in our European and to publishing operations, and $800,000 of EBITDA losses in our new businesses. Among our goals, which we established at the beginning of the year, is to shrink these EBITDA losses over the course of the year and bring them to breakeven.

I'll now open the line for questions, after which I will wrap up with some final comments. Operator, we are now ready for questions.

(Operator Instructions). Mark Jordan.

Good morning gentlemen. A question relative to the acquisition of Agility. As you mentioned, I think you said you had some integration expenses that will flow through the combined companies here the in third quarter. But by the time you get to the fourth quarter, should those two combined entities be -- have at least a breakeven EBITDA?

We will be able to give you better guidance in the next quarter in terms of how we're looking at the business. But a good thing about the business is that the revenues are highly predictable with recurring revenues, and the gross margin profitability is at 50% plus.

To come to the EBITDA, the current media intelligence business that we have has got a deficit of $300,000, and Agility has got positive EBITDA as of the most recent quarter. So a couple of things as we make up our combined product roadmap and the investments, which is the amount of investments we will have to make in sales and marketing, but we are clearly targeting to -- from a targeting perspective we are looking, to have a positive EBITDA as soon as possible, and make it a clear do through the year.

Okay. In your presentation about IADS, your second customer you talked about where you've gone through an extensive customization stage and you've entered into a testing stage, and you think that customer has a $2 million annualized opportunity if fully ramped. How long do you believe that this testing stage will go on until you know if you will be moving towards commercialization?

I'm not sure I heard -- just one word there so I may not need to correct what you said, although I will in any event just in case I got it right. It's not a $2 million opportunity. It's a several million dollar opportunity. We think it's actually quite large if they were to fully adopt our solution.

Okay. Again, how long do you expect the current testing stage to last?

I think that my expectation of the client is that the testing stage per se will probably last another month or two. But while they are testing, they're going to be continuing to bring in other groups and involve them in that testing and begin to expand the service. They have not given a commitment to us in terms of where they are going to get to when.

As I mentioned also, what we do see is these very large, very successful life insurers taking incremental approaches. They walk before they run. And I think the thing that we are very excited about is, as I said, they like the product. They've put an enormous amount of energy into very refined detailed customization so that it fits their use. And they've asked us to put up a second facility so they can have that failover and can comfortably ramp up. So they've invested a tremendous amount in this, they want it to work, and they are now, among other things, evaluating the beneficial effects on the business.

Okay. Final couple of questions from me. The expenditures we expect in the third quarter relative to the internal investigation are down sequentially. Is this a sign that you believe that that investigation will be completed in the third quarter, is question one.

Question two. Once you've done that work and have delivered the information to the Department of Justice, is there any template that your folks have been telling you as to what would be the next steps that might be appropriate in this case from the Department of justice?

Sure. We are expecting that, one, it's down and complete, that's why we are able to give you some comfort that what we expect the additional spend to be in terms of template, we can't really say now until the investigation is complete, but we are hoping that will be complete in the near term.

Okay. Thank you.

Tim Clarkson.

Hi Jack and O'Neil. Just a couple of questions. On this MediaMiser Agility merger, of course I always have a superficial understanding of these things, but my understanding is that MediaMiser's skill set is more in getting the data while Agility is more of an advisor in telling people what to do with the information. Is it more complicated than that?

I can certainly understand where it's, for the uninitiated to this, it takes a little while to really fully understand the business.

You could think of Agility as a product that early adopters can -- or not early adopters but people who are just starting to recognize the need to bring monitoring and distribution tools into their businesses can easily adopt. The average price per customer is a lot lower. It's essentially a SaaS solution. And then it also comes with a tool that enables you to define really who are the people that are the bloggers and the journalists and the folks that you have to get your message out to. So it's very good for medium and small enterprises.

MediaMiser is a software tool as well, but oftentimes the large Fortune 1000 clients, several of whom are our clients, they are looking for a lot of services wrapped around that. And that's really where MediaMiser fits in. So it's software as well as a very robust complement of services wrapped around them.

Now, the good thing is that the large companies are seeing the need, thanks to Facebook and Twitter and blogging and all the activity going on in social media, they are seeing the need to pay more attention to what we call earned publicity. They can't just send out a press release and hope that everything filters down. They are being more proactive. They are building those relationships, so they have the need for the database side that Agility brings.

Now, at the same time, what we are seeing is that, among Agility's clients, many of whom are small and medium enterprises who stuck their toe in the water with these technologies, they are seeing that the do-it-yourself tools aren't enough for truly sophisticated social listening and media monitoring, and they are needing more services and they are needing more robust tools built around that. So we've got a lot of functionality, a lot of capability in the tools that we currently provide to customers, the MediaMiser tools that we are going to be bringing to the Agility customers. We are real excited about that. We've also got a robust set of professional services that are available very economically that we believe they will also benefit from. So they really fit together like two pieces in a jigsaw puzzle, and align very well to where the market is going and where the demand is, both among small and medium-size enterprises as well as large enterprises.

Okay, great. The next question is directed towards O'Neil. At what point do gross margins, at what level of revenue -- I know this is theoretical, but at what level of revenue based on the combination of services we are doing right now do gross margins start to get back up to, say, 35% or so? Are we -- do we have to get to $20 million or to $18 million, or at what point do gross margins start to move up again?

That's a good question. In understanding how our gross margins will increase, it's best to look at the business in segments. So if you start with digital data solutions, the current gross margin for this quarter is 27%, 28%. And the growth that -- our target is probably in the region of about 32% to 35%. It's really a function of topline growth.

At this stage, most of the incremental revenues tend to go down to the bottom line and to be gross margin expansion. So it's really the function of topline growth when we are at $30 million of revenue per quarter.

In the IADS business, on a marginal basis, the profitability of the business is far higher than in the digital data solutions for the simple reason there's a very high level of predictability. But right now, the cost of goods sold also include an element of fixed expenditure because we are carrying certain unused capacity. So it's really a function of topline growth that will help us leverage the fixed costs. And once we get to a breakeven point, which is we have said annualized revenues of $8 million per year, you will start seeing gross margins probably in the 35% range as the revenues keep going up.

In the media intelligence business, the gross margins are 50%, and as the business continues to expand, it will probably be in that same percentage. So, it really is a function of topline growth in our two digital data solutions and IADS business that will get us to the 35%. I would say -- and if you ask me back of the envelope, once we get to the $20 million range total, yes, we should be in that 35% range.

Overall for the whole Company?

That is right. On a quarterly basis.

And that's, based on how things are going, that's not a goal five years out.

No, five years is too far out. We are working hard to -- in each one of the businesses, we are working hard to grow the revenues, and it's difficult to predict the exact time, but the time frame is much shorter than that.

Okay, great. Thanks.

(Operator Instructions). At this time, I would like to turn it back over to the speakers for closing comments.

Thank you operator. We are very pleased, as I already said, but I'll say it again, we are very pleased to be welcoming the Agility team to Innodata. We think in Agility we made a great acquisition. In two years' time, we've gone from a business with zero subscription revenue to having approximately $10 million of subscription revenue, and we are proud of that.

In our Synodex business, we signed a new important client, one of the top 10 US insurers, and we completed product customization for another of the largest life insurers in the United States we signed late last year.

Everything we are doing is about harnessing the power of digital data to enable businesses to make better decisions to spot trends earlier, to operate more efficiently, and to operate more effectively. New businesses are all built on the global platform and technologies that we've built over time in our core business. We're going to continue to innovate the core business also with the prospect of growing it as well, aligning with the needs of broader markets to see the benefits of digital data.

So thank you everyone for joining us on today's call. We will look forward to sharing with you our continued progress through 2016.

Today's conference is available for replay by dialing 719-457-0820, or 888-203-1112, passcode 1449286. Again, the numbers are 719-457-0820, or 888-203-1112, passcode 7598892. That concludes today's conference. You may now disconnect.