NextGen Healthcare Inc (NXGN) 2004 Q3 法說會逐字稿

Good afternoon. I would like to welcome everyone to the Quality Systems third quarter fiscal 2004 earnings conference call. [OPERATOR INSTRUCTIONS] Mr. Silverman, you may begin your conference.

Thank you Operator. Welcome to Quality Systems fiscal 2004 third quarter conference call. Joining me on today on today's call are Greg Flynn, Executive Vice President and General Manager of our QSI Division, Paul Holt, our CFO and Patrick Cline, President of our NextGen Healthcare Information Systems Division.

Please note the comments made on this call may include statements that are forward-looking within the meaning of the securities act including without limitation statements related to anticipated industry trends, the company's plans products and strategies and projected operating results.

Actual results may differ materially from our expectations and projections and you should refer to our SEC filings including our Forms 10-K and 10-Q for discussions of the risk factors, management's discussion and analysis and other information that could impact our actual performance. We undertake no obligation to update such projections or forward-looking statements in the future. Please also note that the Company's past performance is not necessarily indicative of future performance.

For the 14th time in the past 15 quarters the company achieved record revenue performance. For the quarter, the company also set a new earnings record, revenues totaled 18.2 million, up 26% over the prior year, fully diluted earnings per share of 40 cents exceeded prior year by 33%.

As noted in our press release, the quarter's top line results were largely driven by record revenue performances of NextGen, the 14 million in revenues attained by the division for the quarter represents a 40% increase on a year-over-year basis. Company profitability was driven by strong performance at both the QSI and NextGen Divisions. Operating income at NextGen came in at 68% ahead of prior year's total and was the second highest in division history.

At the QSI Division operating income was at the higher end of its recent performance on a hard dollar and percentage basis. The division's 32% operating margin contributed nicely to overall company performance and was our highest since the December quarter of two years ago. The QSI Division's revenues came in at 4.2 million, which was within our historical band.

Our EDI unit set a revenue record with growth at the NextGen unit offsetting a slight decline in the QSI Division's year-over-year revenue performance. I'll once again remind listeners that EDI revenues are reported as part of divisional totals each quarter and are broken out in this part of the discussion for your analytical convenience.

Corporate expenses moderated just a bit from our highest historical levels. I would comment that there continues to be an increasing demand for corporate expenditures principally in the areas of professional services staffing and insurance coverage.

Cash and cash equivalents increased to a record of 45.3 million during the quarter up from 40.6 million in the prior quarter and 33.1 million in the prior year. Head count at quarter-end was 301 which taken with revenues for the quarter generated annualized revenue for employee of 242,000, that was a record by a very narrow margin. There were no stocks repurchases during the quarter. Note that the company's repurchase operation expired on September 24th, 2003, the date of the 2003 annual shareholders meeting.

At present, the company is scheduled to participate in the Roth Capital Investor Conference in February and the B. Reilly conference in March. The company met with an investment professionals in New York, in November and Boston last month.

On Board related matters particularly those that have come up on our most recent call, the independent directors of the company have elected Bud Smaul as a Director, the composition of the board's standing committees have been established and the audit compensation transaction and nominating committees have all been expanded to include four independent directors on each committee.

The board has continued to receive input regarding the optimum use for the company's cash. To my knowledge, no specific plans have been made for utilizing the cash. In closing my prepared comments for this morning's call, I'd like to point out that the performance of the company for this December quarter, as was the case for the few prior quarters, significantly exceeded our internal expectations.

This was particularly true for the NextGen Division, and I would like to express my continued appreciation to each and every member of our team for his or her individual and the collective contributions that people have made to these results.

I also want to again clearly point out to current and/or prospective investors that while we are extremely pleased with the quarter's performance there are absolutely no guarantees that the company or either of its divisions will sustain or exceed the level of performance turned in during this quarter during future periods.

Further, there is what feels to be an increasing amount of publicity surrounding some of the markets we serve including particularly the EMR or electronic medical record marketplace. We are certainly pleased that more and more people are talking about the advantages of such products, but I want to remind everyone and heightened publicity and financial results are not directly linked.

I would like to reiterate, a couple of points that have been made on any number of prior calls, those points are that we do not give out financial guidance to the investment community and we don't comment on the guidance advanced by members of the financial community. I'll now turn the call over to Paul Holt, our CFO for additional financial daylights on the quarter.

Greetings once again to everybody who's participating. I'm going to first talk about the major points of interest on our income statement for the quarter and then move on to discuss key balance sheet items. As Lou mentioned we reported record consolidated revenues of 18 2 million. This result included a strong performance in consolidated systems sales as well as record consolidated maintenance and other revenues.

Consolidated systems sales came in 29% ahead of the same quarter last year, at approximately 9.9 million, while consolidate maintenance and other revenues at 8.3 million represented a 24% increase over the same period a year ago.

Our growth in maintenance and other revenue was driven primarily by the continued growth in the Next Gen base of installed users, which drove maintenance EDI and other revenue in that division to record levels. Included in that maintenance and other category are the revenues from our EDI unit, consolidate EDI revenue, grew to approximately 2,188,000 in the quarter an increase of 19% compared to a year ago.

As this has been asked for in prior calls, I'm going to break that total down by the division. The QSI Division, 1,325,000, and NextGen 863,000. That NextGen number represents an 87% increase over the year-ago quarter. Our gross profit margins this quarter came in around the higher end of our historical range at 58.7% of revenue.

As I routinely mentioned in our calls, the primary factor influencing those gross margins are the level of hardware and third party software content included in our system sales which fluctuates from quarter-to-quarter. This quarter had a relatively lower amount of hardware and third party software content included in our system sales however it was still well within our historical band.

SG&A expense as a percentage of revenue was slightly lower this quarter at 26.9% compared to 27.2 in the year-ago quarter. Total SG&A expense increased to 4.9 million this quarter, compared to 3.9 million a year ago. The largest contributor to the increase in SG&A expenses was an increase in sales and marketing related expenses in the NextGen Division as well as higher corporate related expenses. Total corporate expenses this quarter was $994,000 that compared to $817,000 a year ago.

Moving down to interest income, interest income declined to 95,000 this quarter that compares to 109,000 a year ago. And that was driven lower due to relatively lower short term interest rates on the company's cash. R&D expense grew 21% compared to the prior year quarter at 1.6 million. That compared to 1.3 million a year ago. All this increase in R&D expense was related to increased investment in the NextGen division product line.

The company's effective income tax rate was significantly higher compared to the prior year quarter, at 38.4% this quarter. That compares to 33.1% a year ago. The rate was higher this quarter due to the fact that in the year-ago quarter, the company recorded a catchup tax benefit related to R&D tax credits, which resulted in a much lower rate in the year-ago quarter.

Moving over to divisional performance. The NextGen Division reported its highest ever-quarterly revenue of 14 million, which represents a 40% increase over the year-ago quarter.

NextGen's operating income of 3,789,000 narrowly missed another record while representing a 68% improvement over the year-ago quarter operating income of 2,259,000.

QSI Dental Division reported revenue of 4.2 million and operating income of 1,351,000. QSI division had a lower amount of hardware content in its sales, which resulted in higher gross profit margins for the division. As a result operating margins of the division were 32% this quarter, versus 30% a year ago.

Moving over to the balance sheet, I'm going to highlight three notable areas. It's the AR, deferred revenue and cash. A strong collections performance this quarter helped move our DSOs down a couple of days to 108 days versus 110 in the prior quarter.

Breaking this down by division, we had 77 DSO days at the QSI Division and 117 at the NextGen Division. Both divisional DSOs were within the range reported in the last several quarters although they both had slight declines compared to last quarter. DSOs at the QSI Division declined by two days while the NextGen Division declined by three.

Reflecting the growth in the customer base at the NextGen Division, the company's total deferred maintenance and services grew to 16.3 million that compared to 15.1 million at the start of the quarter. Quarter end cash grew by approximately 4.8 million to 45.3 million or $7.23 a share that compared to 40.6 million or $6.57 a share at the start of the quarter. Included in those cash figures, the company collected $786,000 in cash from stock option exercises this quarter.

Also, company generated $5 million in cash from operations this quarter. That compared to 3.9 million a year ago. I'm now going to break down as I usually do on these calls; I break down our non-cash expenses for the quarter. And as a result of certain in the money stock options granted during the quarter, the company reported 202,000 in non cash expense related to stock options. And that breaks down as follows: 130,000 in corporate, 23,000 for the QSI Division, and 49,000 for the NextGen Division.

Other non-cash expenses break down as follows: Total amortization expense, 369,000, that's 52,000 for the QSI Division and 317,000 for NextGen. Total depreciation expense, 214,000, that's 40,000 for the QSI Division and 174,000 for the NextGen division.

Our investing activities for the quarter were as follows:

672,000 in capitalized software, that breaks down to 70,000 for the QSI Division and 602,000 for the NextGen division. Fixed assets, 336,000, it's 191,000 at the QSI division and 145,000 at NextGen.

On a personal note I'd like to congratulate Lou, Pat, and Greg, and the rest of the quality systems staff for their dedication and hard work on behalf of the company. It's a privilege to be able to work with such capable colleagues. I want to thank you all for being on this call and your interest in the company and I'm going to turn things over to Greg Flynn, Executive Vice President and General Manager of QSI Division.

Thanks Paul. Good day to you all. You've heard the financial numbers could QSI division so I'll provide more than a quick recap here. Our revenues were virtually unchanged over the prior quarter at approximately $4.2 million, and our operating percentage increased again on a quarter over quarter basis, this quarter from approximately 30.7% to approximately 32.2%.

I will mention again, as in the past, that one determining and variable component of our profitability is the mix of software versus hardware sales in any given quarter. Also as noted, our EDI sales to the NextGen client base grew approximately 87% on a year-over-year basis, again validating our strategy to market these beneficial services into this expanding client base. As you know these EDI services are facilitated through the QSI division.

The quarter also again saw several new clients and expanded client implementation of our CPS product, the dental equivalent of EMR. A number of recent product innovations were at note during the quarter as well Our report coding product which we call data minor, our enhanced user interface software and our laser printed generated office forms continued sales penetration within our base.

Our QSI scan and QSI image products recently introduced further continued to generate interest within our clients. These products allow users to manage digital images, where they are X rays, intraoral or scanned, in addition to other images such as insurance cards and explanation of benefits communications, typically called DOBs without the need for the full CPS product.

And just being introduced is our electronic signature capability with the CPS product. Practitioners and/or patients may now create signature authorizations by a signature pad device such as you would see another Lowe's or Home Depot for example via a table PC which can even be wireless. This new offering demoed very well at the recent American academy of dental practice, we term at the AADGP meeting at Las Vegas. I was there at the press meeting itself was encouraging based on our booth traffic with both existing clients and several new opportunities.

As to our current sales pipeline as I always report, with certain sales opportunities prosecuted during the quarter, our pipeline is down slightly to $3.7 million. We define our pipeline as sales situations where QSI is in the final three purchase choices and we believe that the sale will occur within 180 days. Our sales staffing level again remains unchanged.

As reinforced by the ADGP meeting I would like at this time to thank the long term, medium term and new customers who have made their commitment to the products, services and team here at the QSI division. And of course I would like to thank our shareholders for their continued support of our company. And thanks, as always, to the dedicate QSI staff. Now I'll turn the call over to Patrick Cline, president of our NextGen Division.

Thanks Greg. Hi everyone. NextGen had another terrific quarter. During the quarter, our expenses were increased somewhat related to the migration of our practice management customers to our latest software version, which allows them to better, comply with HIPAA regulations. Some of these expenses related to the use of outside consultants, which we've largely phased out of the projects at this point. Last quarter we signed 45 agreements, a significant increase over the prior quarter, 34 of these were with new customers.

Our sales force now numbers 24 people and we hope to continue to grow the sales force, add a couple of more people in the very near future. The market for NextGen EMR still seems very solid and the market for NextGen practice management system NextGen EPM also remains strong. Our pipeline has increased to about $35 million.

We're entering the trade show season at this point with HMS coming up in Orlando in this quarter and we are also preparing for TEPA and other shows next quarter closing and as usual I'd like to thank the NextGen team for helping to achieve terrific results run once again. And Operator, we're ready for questions. Operator?

Thank you sir. [OPERATOR INSRUCTIONS] Your first question comes from Sean Wyland.

Good morning, guys. A question on the industry landscape, if you could comment on what seems like a trend of third-party funding, if you will, of physician investment in electronic medical records, pointing specifically to the announcement by Well point but other kind of discussions. How is that affecting, in your view, the industry, your competitive landscape, the positioning of NextGen and how you're selling the product?

Well, you're right. There is a lot of talk about third party finance, whether it's organizations like Well point or there's been discussions about the federal government perhaps somehow figuring out how to achieve more widespread adoption of the electronic health record by, perhaps, paying physicians more money if they're using such systems. As Lou mentioned earlier there's been a lot of talk. I think it helps to float all the boats.

I think it's helped us in bringing focus to the market and focus to the product and the kinds of returns, and results that these products can achieve. But I'm not prepared yet to point to any specific initiatives that we have going on relative to such financing.

How are your physician, customers reacting to announcements like Well Points? Do you see any holding off their investment waiting for someone else to step in or do you feel like if a (inaudible) is going to use it they should probably be the ones who are buying it?

To this point we haven't seen or heard of anyone holding off hoping somebody else is going to pay for the system. The discussion that's been out there has been nothing but positive for us.

OK. And Paul, a quick question for you. In the schedule on your last Quarter, you put out the amortization of software development cost in 2005 look like they're supposed to go up quite a bit just for kind of a one-year spike. Can you comment on perhaps why that is, and also, how we should model that in over the quarters in fiscal '05?

Sean, we usually we don't give out any forward-type guidance like that. You know, I typically report, you know, the actual amortization expense we had in each quarter. But that's about as far as we go. Sean, it might help if you re-ask your question. Because the way it come through, is you had referenced something we put out that showed a spike in 2005. It's leaving us scratching our heads here.

OK. I just I have the Q here in front of me. Of course now I can't find it. I'll circle back with you when I find it and reference what I'm looking at.

OK.

OK, thanks.

Your next question comes from Mike Crawford.

Good morning. More on the competitive landscape and the class ranking data that NextGen slipped a little bit. And I'm wondering what the differences are that you've seen from IDX and Athena and others or what changes you might be undertaking to address at least that opinion.

First let me see that I don't think we have a big problem with our class standings or report, class focuses on the top 20. We're proud to be part of the top 20, and we're proud to be very close to the top in the categories that matter. Though we're not the top, we do strive to be at the top, and we have a number of different initiatives that we've had ongoing for some time to render the best support and services in our business.

What you'll find with the class report is that the companies that present on the list relatively recently tend to have high marks, and over time, those companies have trended a little bit lower. And if you go back through history, of years, you'd see that happening. A lot of that has to do with the investigation that class does on their own into companies, customers, and references in asking questions, and how companies are allowed when they get started with class, to provide the names of their reference accounts.

OK. So you're not undertaking any initiatives whatever based on any comments that were highlighted out of this most recent?

We pay attention to all those comments, and we do, as I mentioned, have a number of initiatives going on to make sure that we do render the best service and support available in our business. We're not perfect, but we're doing very well. And in fact over the last couple of years, our numbers have improved. Our response time is down, and our problem resolution time is down. I don't want to comment on specific comments that were mentioned in the class reports. But I think the initiatives that we have ongoing are working for us pretty well.

OK, thanks Pat. And one final question for you is, you know, the EMR adoption rate it's estimated anywhere between 5 and 25%. It is seems like a huge band. I'm wondering what your thoughts are on what it actually is.

Are you referencing the percentage of the market that has EMR systems today?

Yes.

I'd peg it more like 15, 16, and 17%.

OK, great, thank you. And then on the QSI side, are you seeing any more traction with the clinical product suite, or is most of the demand for things that used to be a component of that product?

Well, actually to characterize it without being specific, I would say I have seen an upturn on interest on that product. And that's the total CPS suite. We have modularized it somewhat as you're referencing. But without being specific on clients, there is an upturn there.

OK. Great, thank you.

Your next question comes from Brandon Osten.

Hi guys, how you doing?

Hi Brandon.

Just on the deferred revenues, relative to accounts receivable, how much of the accounts receivable is out of deferred revenues?

Brandon, that's 9.2 million. It is going to be in the Q as well.

9.2 million of the receivables is deferred revenue?

Yes.

OK. And in terms of deferred revenues, how much of that is maintenance related and how much of that is sort of business yet to be recognized into revenues?

Well, Brandon, we haven't in the past given out that level of detail. But just that in general terms, it's both the maintenance and services as well, with the larger majority of that amount being services, deferred services.

OK. In terms of systems sales, they were a bit down from Q2. What exactly was the cause of that?

I don't think there was any particular cause. We're doing very well but we're still a relatively small company. And where you have an average sales size that can be hundreds of thousands of dollars, one sale can make a big difference. But overall I'd say we're very pleased with the results, top line, and continuing to set records.

All right. And I guess that kind of plays into my next question, which is relative to scalability. You guys I get you're 40% over last year. You know, forgetting about what, you know, what might close or what could happen, how fast do you feel you're capable of growing, if all the various business factors were there to allow you to grow as fast as you can?

I would say we're capable of growing 10% or 20% faster than we're growing now. However, I would add, and more importantly, that we are also engaging in a number of internal initiatives to be able to scale much more quickly. I'll give you one example of that. That's a new computer-based training program that we're developing right now. Our systems are sold with many, many hours, typically hundreds of hours, of installation and training services.

And we're looking at these areas and saying, how can we, if we move to selling 100 systems a quarter, 200 systems a quarter, render these training services without throwing more bodies at it, or as many bodies at it as we have now. So we're developing training programs to augment the face-to-face training with computer-based programs. That's an initiative that we kicked off some time ago. It's going rather well but probably still has six months or a year to go. But those are the kinds of things we're looking at. I won't get into all of them, just wanted to provide an example.

Could you just repeat what the pipeline number was for NextGen?

35 million.

35 million, OK. And on the capitalized software, did you say it was 700,000 in the quarter?

Paul's getting that number right now.

Right. And I think you said amortization was 400,000?

672,000 is the total capitalized this quarter.

Okay. And that's versus amortization of 400?

Yeah, 369,000.

Okay. Did I hear that correctly, that the majority of that was for the QSI Division?

No. The majority of that would be for the NextGen Division.

NextGen, okay, I got it backwards, all right. And in terms of average deal size, pricing pressure type issues, are you seeing any of that on the NextGen side? I just noticed the average deal size is down a touch from Q2 but still above Q1, which was below Q4. Like, is that kind of a number that's going to keep jumping around on you or is there a trend there to be made aware of?

I think it's a number that is going to keep jumping around. It has for many, many quarters, in fact years. Though going out into the future years and not quarters, I think you will see the average deal size coming down and the number of deals done going up. As the early adopters, the larger practices become -- that market becomes a little more saturated and as the smaller practices and that market opens up more, that's what I think you'll see.

Okay. And of the 24 salespeople that you've got, how many of those guys would you say are sort of at full quota at this point, been there for more than nine months?

Oh, anything I tell you, would be just a guess. I'm going to guess at less than half of them.

Okay. And are you still going on that, it looks like you're trying to add one salesperson per quarter. Is that the plan or?

We actually are trying to add two per quarter. The result has been more like one per quarter. In fact, in the last quarter we added two and lost one.

Okay. And has anything changed on the competitive landscape? Anyone new you're seeing, or less often or more often?

Not really. All the usual suspects. We have seen a couple of newcomers come into the market. Struggling along, whenever you have a market like this, that's a solid market that's hot and in its infancy. You'll have new competitors pop up from time to time but nobody that we're concerned about.

Great, thanks a lot, guys.

Thank you.

Your next question comes from Gene Menheimer.

Brandon Good morning, and congratulations on a nice quarter, guys.

Thank you.

A couple of questions. One, on QSI, it looks like sales were relatively flat at 4.2 million sequentially, but this is a mid some new product introductions last time, including QSI scan and QSI image. Can you just comment on the sales cycle involved in selling these modules, and your strategy on increasing revenue per customer?

Let me take the questions a little bit in reverse for you. Our strategy is to get the word out on our new products; such as we're doing through a variety of means including the shows very key, because probably our most important show of the year where the large group practices are.

We are looking to introduce new client products within the base, obviously, since it's a fairly well captured base I guess to use that term. Sales cycle typically on these types of products, we don't have enough track record with it, but I would say it's anywhere from two months to six months. There's an education process, and typically there's full adoption throughout the group. So it's not an instantaneous type of switch.

I would add Gene that these are not huge ticket items that we're talking about here. The point of this addition is that, they enhance functionality and therefore seek to enhance the types of relationships that we have with our customers there, client retention tools, as well as enhancements to the product. And both of those are significant and in many ways more significant than the top-line impact.

OK, thank you. And Lou, can you just provide us with sort of an update on the acquisition strategy that has been ongoing?

Yes. Well, I'd say that it's, I would echo the same words that I've used in the past few calls. The search goes on. It's at a fairly low level. The funnel is less full than I'd like it to be. Due more to, a bit of a shortage of interesting opportunities than a desire to look at interesting opportunities. But we do continue to look at some things from time to time.

I have a number of items in the funnel right now, but it would be pre matured to hint or suggest that we're close to doing anything with anyone. The opportunities in the funnel are still at very early stage.

OK

The funnel is not at an early stage but the opportunities that are in it are at an early stage. So continuing to look and churn through some things, but its a slow-moving process.

OK, thanks very much.

Thanks Gene.

Your next question comes from Andrew Shapiro.

Hi, part a follow-up on Gene's issue is that, cash of quality systems has been more than 50% of the company's assets for well over two years and may be even four years. That raises the risk of the company been to subject the patient the onerous burdens of the investment company act. And I'm trying to understand what steps does the company take to avoid this and what are the costs to the company of doing so?

Andy, we have worked to ensure that the money that we have, the cash that we have is deployed in the appropriate investment vehicles to be in compliance with the act that you cite, the investment banking act of 1940 I believe is the official name. In addition to that, the board has continued to be reminded of the importance of investigating the appropriate use of cash and make sure that it's exercising its responsibility to ensure that the asset that we have is employed in a responsible fashion.

What do you think it costs the company in lowered returns on the cash assets, you have to invest in versus what you might be able to earn on, we'll call it higher yielding cash investments or marketable securities that you can't invest in because you have so much cash?

I think I'd decline to speculate on that Andy. I think different people could make own assumptions and come up with whatever the number is. But I feel it is inappropriate for me to engage in one speculation like that.

I noticed all the while on a follow-up question here is I notice in the immediate days after last quarter's conference call the disclosure deep in the money option grants that were made as well as a lot of insider selling, that all of a sudden took place. I just want to know what is the trading window policy for the company's insiders from Mr. Razin on down to management with respect to your earnings and estimates and disclosures, what is the timing windows here?

We have a policy that is in force Andy. And I would just leave it at that. I don't believe that we -

Should the public be available or allowed to know what the policy is, when insiders can or cannot be selling?

It's a fair question. I think people could probably back into it from looking at the dates and times. But at this point, I don't feel that I would be giving that out.

OK, fair enough, thank you.

Your next question comes from Corey Tobin.

On the NextGen side, could you provide insight into which practice areas are buying? Are most of the sales are General practitioners or are there one or two specialties that are highly represented in the sales base?

Our sales tend to be spread across a number of specialty areas. We do quite a lot with primary care; we do quite a lot with multispecialty practices. Those practices that are in fact specialty practices but encompass a number of different specialties, that is. And there are four or five individual specialties that we tend to do very well within. They would include cardiology, ophthalmology, orthopedic surgery and a couple of others.

Just to try to quantify that a little bit, would you say 50% or so of the sales in any quarter are typically to general practitioners and then 50% to specialists or how would you cut the pie?

I'd rather not place a guess at that. I may try to be a little more prepared to answer that on our next call but I don't have the individual sales here in front of me. To venture what I'll preface by saying is a wild guess, I'm going to say it's a pretty even split.

Between general practitioner and specialties as a whole?

And specialties, yes.

OK, great, thanks.

OK.

[OPERATOR INSTRUCTIONS] Your next question comes from Rick Leggett.

Good morning, gentlemen, Harvard Capital. I'm curious that the board of directors, neither Mr. Silverman nor Mr. Cline is on the board, is that correct?

That's correct.

Given the importance of NextGen and the role that Mr. Cline has, I guess I direct the question to the chairman and the board of directors, what is the thinking here and are there prospects to change in the near future?

Prospects for management representation on the board?

Exactly.

I think that your question is appropriately directed to the board of directors. It's difficult for Pat or I to comment on the plans that the board may or may not have on really any topic.

Are they accessible?

I believe the answer to that is yes, though it's hard for me to speak for them. I would suggest if you had an interest in speaking to a particular board member, that you could certainly call the company and leave a message for them at the switchboard and we would see to it that that message is forwarded directly to the particular individuals in a prompt fashion.

OK. Well, you're doing a nice job. I think that's very relevant.

I appreciate the question.

There are no further questions at this time.

I would like to thank everybody for participating in today's call, and we will see you next quarter. Thank you.

Thank you everyone.