IRadimed Corp (IRMD) 2017 Q4 法說會逐字稿

Ladies and gentlemen, thank you for standing by. Welcome to IRadimed Corporation Fourth Quarter 2017 Financial Results Conference Call. (Operator Instructions) As a reminder, this conference call is being recorded today, February 6, 2018, and contains time-sensitive information that is accurate only as of today.

Earlier, IRadimed released financial results for the fourth quarter 2017. A copy of this press release announcing the company's earnings is available under their heading News on their website at iradimed.com. A copy of the press release was also furnished to the Securities and Exchange Commission on Form 8-K. A copy of the Form 8-K can be found at sec.gov. This call is being broadcast live over the Internet on the company's website at iradimed.com, and a replay of the call will be available on the website for the next 90 days.

The agenda for today's call will be as follows. Roger Susi, President and Chief Executive Officer of IRadimed, will present opening comments. Then Brent Johnson, IRadimed's Executive Vice President of Worldwide Sales and Marketing, will discuss customer orders. And finally, Chris Scott, IRadimed's Chief Financial Officer, will summarize the company's financial results before opening the call up to questions.

Some of the information to be furnished in today's session will constitute forward-looking statements within the meaning of this Private Securities Litigation Reform Act of 1995. Forward-looking statements are those focused on the future performance, results, plans and events, and includes the company's expected results for 2018. IRadimed reminds you that future results may differ materially from these forward-looking statements due to a number of risk factors. For a description of the relevant risks and uncertainties that may affect the company's business, please see the Risk Factors section of the company's most recent reports filed with the Securities and Exchange Commission, which may be obtained for free from the SEC's website at sec.gov.

I would now like to turn the call over to Roger Susi, President and Chief Executive Officer of IRadimed Corporation. Mr. Susi?

Thank you, operator, and good morning, everyone. This morning, we are happy to report fourth quarter revenue of $6.7 million, a GAAP net income $0.02 per diluted share and non-GAAP net income of $0.10 per diluted share. Both our GAAP and non-GAAP earnings being significantly impacted by recent tax reform, and Chris will have more on this a few more moments.

For the full year, revenue was $23.1 million, with GAAP earnings of $0.04 per diluted share and non-GAAP earnings of $0.22 per diluted share. I'm very pleased with these results being largely in line with the high end of our expectations and representing an increase of 12% over the fourth quarter of 2016.

There are also several additional bright points that I would like to highlight. First, 2017 revenue from sales of our IV pumps, IV sets and services were 7% higher than in 2016 when excluding the amount of revenue that came from backlog due to the withdrawal of a former competitor, which we have detailed in the past. Second is our fifth -- it has been our fifth consecutive quarter, higher sales of our IV pumps, IV sets and services reported in revenue, and again, when excluding the amount of revenue that came from backlog during 2016. We believe these points show that this is not simply a year-over-year blip in customer orders, but that a valid trend is taking shape. And that trend, we view as being very positive and expect to continue into the future.

Another bright spot is that we can now layer in our new patient monitor, which we're happy to report received FDA 510(k) clearance in October, and which came as a result of the hard work of our engineering and regulatory affairs teams that was put in on this project over an extended period of time. While the monitor clearance came late in the fourth quarter, much later than we had anticipated, the sales team was able to quickly adjust and perform many customer demonstrations, showcasing its features and the additional value that it offers through its compact and lightweight design. Several domestic customers like the new monitor so well after seeing an initial demonstration that they immediately submitted orders, many of which were filled prior to the year-end. This is especially noteworthy as the typical sales cycle for such a device is much longer than a few weeks than frequently much longer than a single quarter. This quick decision-making by our customers shows the clear advantage our new device represents.

For the year, we recognized revenue on 70 MRI compatible patient monitors, much of which came from the international markets, which we have been able to sell into for the entirety of 2017. While many of these were sold to our distributors as demo units, we are pleased that a significant number sold through to end user customers. We're very happy with this activity, and it shows the type of positive feedback and customer acceptance we are seeing and have been talking about for many quarters now.

Transitioning the monitor from engineering to production has progressed smoothly. Our manufacturing teams have worked diligently incorporating the second device into their workflow and are poised to address the higher level of demand for all of our products that we expect in 2018

With the clearance of our MRI monitor, the engineering and regulatory teams now look to continue executing on our new product road map. Because of this, we expect higher levels of investment in our R&D efforts as we move toward developing 2 separate projects, new projects, simultaneously, one of which may be available for sale later this year or early 2019. The second of the 2 projects is longer term in nature, and we anticipate will be available for sale in late 2020 at the earliest. In addition to these entirely new projects, we will undertake smaller development efforts that will extend the features and functionality of the new MRI patient monitor as well.

I'll finish by saying from engineering to regulatory and from production to sales, we have made great progress this year. Financially, we finished the year strong, establishing and building upon some very positive trends. Operationally, we surpassed a milestone in the company's history with the clearance and U.S. launch of our second device and the integration of that device into our daily workflows and the creation of many new sales opportunities.

Now before moving the call on to Brent for a discussion of customer orders, I'd like to review our financial guidance for the first quarter and for the full year 2018.

As we announced on January 22, we expect the first quarter revenue of $6.8 million to $6.9 million, with GAAP earnings per share of $0.04 to $0.05 and non-GAAP diluted earnings per share of $0.06 to $0.07. For the full year 2018, we expect revenue of $29.3 million to $30 million, GAAP earnings per share of $0.22 to $0.27 and non-GAAP diluted earnings per share of $0.33 to $0.38. Included in our full year revenue estimate is $6.6 million to $6.8 million in sales of the new patient monitor.

I'll now turn the call over to Brent for a discussion of customer orders.

Thanks, Roger, and good morning, everybody. Before getting into the customer orders, I'd like to discuss just a couple of highlights from our national sales meeting held here in Orlando in January. This was our second opportunity in the past 3 months where we brought the team together to do some additional training on the 3880 patient monitor, and the experience level is ramping up nicely. Training has been a big focus of ours for the past year, and it will continue to be as we aggressively expand the size of our U.S. and international sales team. We've recently added 2 additional U.S. sales managers for a total now of 20 direct sales managers and promoted a third area director from our sales manager -- from one of our sales management team to manage the additional headcount. We plan to continue expanding our sales teams in both the U.S. and international markets during 2018.

Now into a summary of our customer orders. IV pump bookings for the fourth quarter were nearly 5% higher than the fourth quarter of last year and were roughly in line with our forecast. The composition of orders for our pump systems in the fourth quarter was consistent with the rest of 2017, with approximately half the orders coming from first time adopters and the other half coming from existing customers. Additionally, customer orders for our IV pumps increased for the last 3 quarters of 2017 when compared to the same 3 quarters in 2016 and were higher in total for the full year 2017 compared to the full year 2016.

Another positive data point is we're seeing it's almost a 150% increase in the number of multi-pump orders during 2017 compared to 2016. These multi-pump orders accounted for just over 30% of our total domestic units sold for the year. And again, just for definition purposes, we define a multi-pump order as 3 or more IV pumps on a single order, and they are typically heavily influenced by the critical care department of the hospital. We view these customers order transfer IV pumps as positive and believe they show our strategy of targeting the critical care department, along with our historical core market in the MRI department is taking hold and gaining traction. We are experiencing greater rate of success with our critical care strategy by stimulating the demand for MRI safe pumps in those departments and changing their practice of either using conventional pumps with long IV lines extending into the MR room or just waiting until patients are stable enough to go to MRI for diagnosis scan without IV medication.

As for the 3880 MRI compatible patient vital signs monitor, customer orders for the year were in line with our expectations, even with the domestic launch moving from Q3 to Q4. International orders were especially stronger in the quarter, which, as Roger mentioned, is very encouraging and shows the traction we are beginning to get with our distributor teams. After receiving FDA clearance late in October, we focused our domestic sales efforts on performing demonstrations and evaluation for our MRI patient vital signs monitors at hospitals that had intended on purchasing the device during the fourth quarter. This resulted in several units being sold in the U.S. during the last 2 months of the year and generated numerous leads that we're carrying over into the new year.

Overall, there's a great deal of interest in our monitor, and we look to offer all customers a better solution that solves many of the current workflow issues that are present in MRI. This is especially true when it comes to transporting patients to and from the MRI department while maintaining high quality vital signs monitoring and continuous IV infusion of medications resulting in a higher level of patient care.

Additionally, combining our new monitor with our IV pump into a patient transport system and sold as a single package creates another opportunity for us as we're the only company that can offer that type of a transport system. When successful in bundling these 2 devices for hospital looking for transport package, the number of MRI patient monitors and MRI IV pump sold per scanner will increase, resulting in a larger overall market for these 2 devices.

As I've said before, the revolutionary compact and lightweight design of our MRI monitor allows for this type of intrahospital patient transport, and no other MRI patient monitor in the market today can offer this type of flexibility.

We continue to believe that sales of our monitor could produce an additional $22 million in annual revenue within the next 24 months and continue to grow from there.

Now I'll turn it over to Chris to summarize fourth quarter financial results.

Today, I'll be discussing our financial results on a GAAP basis as well as on a non-GAAP basis. Our non-GAAP operating result excludes stock-based compensation expense and the related tax effects. Our free cash flow measure is cash flow from operations, less cash used for purchases of property and equipment. And lastly, infrequent tax items are considered based on their nature and excluded from the provision for income taxes as these costs are not indicative of our normal or future provision for income tax expense.

For the fourth quarter 2017, the infrequent tax item included in our non-GAAP calculations relates to the impact of the Tax Cuts and Jobs Act enacted on December 22, 2017. We believe the presentation of these non-GAAP measures, along with our GAAP financial statements, can be helpful in providing a more thorough analysis of our ongoing financial performance. You can find a reconciliation of these non-GAAP measures to the nearest GAAP measure on the last page of today's press release.

As Roger stated, we reported fourth quarter revenue of $6.7 million compared to $6 million for the same quarter last year. Domestic revenue was $5.3 million or 79% of total revenue for the current quarter compared to $5.1 million or 86% of total revenue for the fourth quarter last year. Revenue from international sales was $1.4 million or 21% of total revenue for the current quarter compared to $900,000 or 14% of total revenue for the 2016 quarter. Revenue from devices was $4.7 million or 70% of total revenue for the current quarter compared to $4.3 million or 72% of total revenue for the same quarter last year. And again, included in revenue from devices was $900,000 in sales of our new MRI compatible patient vital signs monitor.

Revenue from IV sets and services was $2 million or 30% of total revenue for the current quarter compared to $1.7 million or 28% of total revenue for the 2016 quarter. We recognized revenue on 110 IV pumps this quarter compared to 128 pumps in the fourth quarter last year. The average selling price of IV pumps recognized in revenue during the 2017 quarter was approximately $33,900 compared to approximately $32,600 for the same quarter last year. The increase in ASP is the result of favorable sales mix as we sold more higher priced optional pump features per pump sale on average than in the 2016 quarter.

Gross margin was 75.5% for the current quarter and 78.2% for the 2016 quarter. The decrease in gross margin percent was the result of unfavorable inventory cost adjustments, the impact of sales of our MRI compatible patient vital signs monitoring systems at introductory prices and higher international sales as a percent of total revenue when compared to the 2016 quarter.

Operating expenses for the fourth quarter 2017 were $4.1 million or 61% of revenue compared to $3.2 million or 53.1% of revenue for the fourth quarter 2016. The increase in operating expenses is due to higher expenses for payroll and employee benefits due to higher headcount and stock compensation expense, partially offset by lower expenses for consulting, legal and professional services and lower corporate franchise taxes.

Our effective tax rate for the current quarter was 82% compared to 25% for the 2016 period. The higher effective tax rate is primarily due to unfavorable -- to the unfavorable impact of the Tax Cuts and Jobs Act. The passage of this tax reform caused us to revalue our deferred tax assets and deferred tax liabilities to account for the future impact of lower federal tax rates on these deferred amounts. This resulted in a onetime noncash charge of approximately $474,000 to income tax expense during the fourth quarter. Additionally, our effective tax rate was negatively impacted by net tax shortfalls related to the exercise or vesting of equity awards and expense related to incentive stock options granted to employees.

On a GAAP basis, net income for the current quarter was $0.02 per share compared to $0.10 for the fourth quarter of 2016. On a non-GAAP basis, net income was $0.10 per diluted share for the current quarter compared to $0.11 for the fourth quarter last year.

For the year ended December 31, 2017, cash provided by operations was $3.4 million compared to $9.4 million for the 2016 period. The decrease is primarily the result of lower net income and higher net cash outflows related to accrued income taxes and accounts payable, partially offset by reduced inventory purchases and the lower cash outflows for payroll. Our free cash flow and non-GAAP measure was $1.3 million and $2.6 million for Q4 and the full year 2017, respectively, compared to $2 million and $8.6 million for Q4 and the full year last year. During the year ended December 31, 2017, we used $1.8 million to repurchase approximately 210,000 shares of our common stock pursuant to an $8 million repurchase authorization that was announced back in April 2017. At the end of 2017, we had $26.3 million of cash and investments and backlog of $2.7 million.

Before turning the call over for questions, I would like to add a little more color around our 2018 guidance.

With positive 2017 booking trends for our IV pumps that we see continuing into 2018, the FDA 510(k) clearance and healthy customer interest and orders for our patient monitor during 2017, we have a high level of confidence in our 2018 forecasted revenue growth and believe similar growth could continue into 2019 from our current product set.

Included in our revenue guidance is growth from IV pumps -- IV pump sales of 11% to 14% and growth in patient monitor sales of 256% to 265%. On the cost side, we estimate that operating expenses will increase over 2017 by 16.5% to 17%, with most of the increase resulting from higher headcount, higher sales commissions and higher investments in our R&D efforts as we look to accelerate new product offerings.

And lastly, with federal tax reform in mind, we have modeled 2018 income tax expense using a 27% tax rate to reflect the potential for states to decouple from the federal definition of taxable income, which could result in higher U.S. state tax expense.

And with that, I'll turn the call over for questions. Shannon?

(Operator Instructions) Our first question comes from Larry Solow with CJS Securities.

Great. Just on the pump side. Just curious if you can maybe just give us a little color on the evolution of your sales efforts. It certainly sounds like the focus on the critical care department is definitely helping out. Do you think we're still in the early stages of this? You obviously mentioned your bookings are up over 5%, and it sounds like your outlook is for about 10% growth on pumps. So certainly, it sounds like return to growth. And maybe we don't get back to the -- what we thought was 1% to 20% plus growth, but it does sound like you're fairly comfortable with growth in at least high single digits and maybe accelerating going forward.

Yes, Larry, this is Brent. The one thing, too, if you look year-over-year, 2016 to 2017, what you're seeing there, too, is there's still a little tailwind on orders in 2016 from that MEDRAD, the MEDRAD recall, where a competitor left the market. So I think it's belying a little bit of the growth we had in 2017. So I see the growth continuing to accelerate for 2018, and that we're really picking up some traction there with our [IC] strategy.

And I know you had -- one of the impacts you had said was it was a little bit slow just to get some of these new departments on board, approvals, new departments, budgeting for the new departments. Has some of that log jam cleared up? Is that one of the factors that's helped you?

Yes, it's still challenging because when -- especially with customers that are -- that haven't considered a purchase of an MRI IV pump before in the past. So there aren't ready-made budgets. But yes, I mean, we're making an impact there every quarter that goes by. We're touching more and more of these hospitals that have never bought an MRI IV pump, and we're getting more and more things into the budget with each passing quarter. So yes, we're definitely making headway there. And as we also discussed, 50% of our sales are really coming from that installed base, which really shows the opportunities that exists out there as well because we've got many customers out there that still aren't fully utilizing the pump in all departments of the hospital. And we're continuing to make a great headway there with -- we're getting more engagement with our pumps and selling more pumps into those hospitals.

And maybe just a question for Chris. Just on the monitor side. Early stages, is there any difference in sort of profitability between the 2, between the monitors and the pumps? And I don't know if there's much of a disposable piece or a consumable piece to it, but the margin sort of ramps up as production sort of ramps?

They will. And I mentioned introductory prices in my comments there. I suspect that will remain at a lower pricing level at least for the next couple of quarters, I suspect, before we get into what we believe is a fully priced monitoring system. So because of the introductory pricing, yes, of course, margins today are lower than what we anticipate once we get fully up to speed there.

And that full price would be sort of in that $50,000 to $55,000 range? Is that...

Yes, that's the ASP, that's the global ASP that we're shooting for, is $50,000 to $55,000. And at that rate, we'll achieve margins that are very similar to what you've seen us achieve in the past.

Our next question comes from Larry Haimovitch with HMTC.

Brent, a question for you. Update -- any update on the sales force, the number, the turnover, the changes? I know there were quite a lot of changes over the last year, too, as you transitioned. Can you just bring us up to date on that, please?

Sure, Larry. Yes, we -- as I mentioned, we just did an expansion where we hired 2 additional sales territories, so we're up to 20 territories now. I did vote a third area director, so that opened up a territory. So -- and we did have one turnover that we anticipated. But other than that, I mean, it's very strong. Little -- very little turnover. And we are, as I said, aggressively hiring more salespeople this year. And so our training efforts are -- as I was talking about during the call, our training efforts are very important this year just because of the new salespeople and the new product. I mean, we're having -- again, the guys are very familiar and very comfortable with selling in a hospital environment obviously and in the MRI environment. But the patient monitor, is a new technology for them. And again, there's a bit of a learning curve on that as well. But ...

How many -- sorry, how many sales reps would you anticipate being up to by the end of the year?

Well, we're targeting increasing an additional 4 salespeople, so getting up to 24 salespeople by the end of the year.

Okay. And by comparison, let's say, at the end of '17 and the end of '16, how many sales reps did you have?

Yes, at the end of '17, we had -- we had 18 salespeople at the end of '17, and we had 18 salespeople at the end of '16 because we really held off on expanding until the patient monitor was approved in the U.S. So again, now that we've got the patient monitor approved, we're back to that aggressive expansion pace.

Could you give us a little more color on the impact of the new product for the sales reps? Now they've got 2 things in their bag, not one. Does this make them much more efficient? Does this make them -- how does this work for the sales rep in the field on a practical basis now that they carry a second product in their bag?

Yes, well, we certainly hope so. We see a lot of bundling opportunities out there, Larry, with the 2 products now. Remember, we are still -- we always have been selling to the MRI department with the pump. And so we're not going -- this isn't requiring us to go to different departments. We're talking to the same folks. We're just now having another product to talk about. So time-wise, the time they spend, it dovetails very nicely into what they're already doing. And so the majority of the focus right now is on the MRI department because that's where the opportunities are, the ready-made opportunities are. We often talk about the fact that this market is a -- it's a mature market. There is basically replacements each year for patient monitors. So the guys are really focused on going out and finding those opportunities that are happening in their territories and attacking that business. But by the same token, we are -- still have that ICU call point, that critical care call point, and we are heavily seeding that market as well, talking about the fact that, look, now we've got a transportable system, we've got the IV pump, we've got the portable MRI patient monitor that no one else has and really get -- this is again where that we've got the new concept to sell out there and much in the way that we're doing with the pump, expanding that marketplace for the MRI patient monitor. So as far as how it works, it works into the workflow perfectly and gives them an opportunity to have something else to talk about, reestablish some -- maybe some accounts where we've been before, where we haven't got traction, and now really having some opportunities to bundle IV pumps along with the patient monitor or vice versa.

Okay. And then one final question. I'll jump back in the queue. Maybe a 2-part question. Have you had a competitive -- seen a competitive response from your other competitor, which I believe had a monopoly before you joined the market? And number two, does bundling give you a competitive advantage over that competitor because they can't do that?

Yes, I mean yes to both questions. We have seen somewhat of a response from our competitor, and yet have seen lower prices in a few deals. Although we don't expect that to be anything that's done across the board, but too early to tell there. So yes, I mean that's the -- that's what we're seeing right now.

And, Larry, if I can just add to something there, Larry. We've spoken a lot today, and we've spoken a lot in the past about this whole transport idea. And that's where the size of our device, that's kind of the sweet spot that we see that we really feel like we can distinguish ourselves from the competitive set. If their hospital is looking for a way to transport these critical patients while maintaining continuous vital signs monitoring and maintaining continuous IV infusion and medication, then we offer the only product in the world that can accomplish that right now. So I think that bundling idea of putting a pump and monitor together with the idea that we're going to transport patients around hospitals really, really causes -- IRadimed really stands apart from a competitive set in that respect. So I think that's a very important point that shouldn't be lost.

Yes, that's very important. When you discuss it that way, it does clearly give you a competitive advantage over your main competitor.

(Operator Instructions) Our next question comes from David Solomon with Roth Capital.

Just curious about the monitor and the growth that's expected, what you've seen in the foreign distributor channel, how much of the growth should we expect coming from foreign versus U.S. in the next year or so?

Oh, it's definitely -- I mean the U.S. is -- that's where we have these 20 salespeople. That's where the big competitor does the majority of its business. Yes, they're just bigger numbers in the U.S. in general. So you'd have to say that the growth story is going to be primarily U.S.-driven.

Okay, okay. So if we're looking at the -- what was it, 250% growth expected? So assume that maybe 2/3 to 3/4 is in the U.S.?

I think that'd be a fair assumption.

Okay. Just curious with the gross margins. How much of that was impacted by the foreign channel versus the other reasons that the gross margins were a little lower than we had previously modeled?

David, I can't -- I'll have to get back to you on that. I don't have those in front of me.

Okay, okay. But should we think about them moving back up to the high 70s? Or do we see this as like a new point for -- or just noise this quarter?

No, I think this is noise for this quarter and maybe even the first quarter of 2018. I think once we move past this introductory pricing and we achieve ASPs closer to what we've targeted, then you'll see that margin expansion back up into the high 70s to the low 80s.

Okay, okay. And then I'm just curious about these new projects that were mentioned earlier in the call, one in the late '20 and another near term. Just wondering if you can give a little bit more color on these?

Yes, a little bit maybe. We don't want to tip our hands too much definitely at this point on the details. But the one device, obviously, since we're guiding that we could have that product potentially on the market year-end, early next year, this is a device that's a -- let's call it a sort of a safety enhancement device, but it's not directly a medical device as such. And this market exists for such a thing right now, and it's around the $20 million, $25 million market right now. And with the players that are in that space, we think that with our technology and our sales force, we can get into that area with a very nice product offering and be extremely competitive. So though, basically overall, it's potentially, the top end, it's not $100 million product line or anything. But we think that we could take a big chunk of that existing $20 million, $25 million market with that device in relatively short order. The other device is basically -- is our next step in the IV fluid delivery area. So the course has a long -- not only a little bit more challenging development cycle, but certainly, it has a challenge again with the time it takes to get such devices through the FDA, so that's why we say it's off in a 2020 time frame.

Okay, okay. So just going back to the guidance that was on -- the call for approximately high 20%, low 30% growth next year, and then in the press release, accelerated growth going forward. You expect that coming mostly from these new products or also from the monitor as well, the acceleration of the growth?

Nothing from the new products, David We don't have that -- it's not in there for 0 in those -- in this next (inaudible).

Our next question is a follow-up from Larry Solow with CJS Securities.

Two -- just 2 quick follow-ups on the R&D side. What happened with the -- this product, the warmer? I guess it was sort of a warmer. The patient cool -- biothermal cool down, right, that had to be removed from the MRI, but your -- you had some type of a device that clicked on a warmer of some sort? Is that still in development? And I guess, you have any next-generation pumps that I thought was also in development?

Yes, well, yes to both. However, we've talked about in the past what we're going to do with the next-generation pump and this patient thermal management system. So the thermal management system is something we still have on our roster, and we're actually seeking some patent protection in that area with the initial design concepts. But the market for it seems to be relatively small. And so when we do our sort of value analysis where we should put our energies in the short term, we're moving ahead or moving up, advancing the time table on the next generation of IV fluid device and pushing that thermal management thing out rather than the other way around, which it had been until recently.

Okay. And this will be a new market for you, though, obviously, right, I mean IV fluid device, right? So I mean, that's...

No, no, no.

Well, an adjacent market, I should say. But -- on the -- and the safety enhancement product you spoke of, is that something you developed in-house or something you have acquired at some point along the way, the technology? Or any color on that?

No, we're making that. Yes, we're developing it.

And you -- kind of you discussed it, but just switching gears real fast. Our tax rate assumption for '19?

For '19?

For -- excuse me, for '18.

Yes, I mentioned the 27% tax rate in 2018 is where we're modeling at.

This concludes the question-and-answer session. I would now like to turn the call back over to Roger Susi for closing remarks.

Okay. Operator, thank you.

Again, I'm very pleased with our financial results, and moreover, the positive trends in our IV pump orders that have taken shape over the past several quarters and especially the very strong customer reception of our new MRI patient monitor. The growing demand from -- for our current products and for active execution on our new product development, we believe that IRadimed is well positioned for meaningful revenue growth over the next several years. Look forward to reporting back to you after the first quarter. Thank you.

Thank you. This concludes the call. Please disconnect.