New York Times Co (NYT) 2013 Q1 法說會逐字稿

Good day, and welcome to The New York Times Company first-quarter 2013 earnings conference call.

Today's conference is being recorded.

At this time, I would like to turn the conference over to your host, Ms. Paula Schwartz.

You may begin.

Thank you.

Good morning, and welcome to our first-quarter 2013 earnings conference call.

On the call today are Mark Thompson, President and Chief Executive Officer; Jim Follo, Executive Vice President and Chief Financial Officer; and Denise Warren, Executive Vice President, Digital Products and Services.

All of the comparisons on this conference call will be for the first quarter of 2013 to the first quarter of 2012, unless otherwise stated.

Our discussions will include forward-looking statements and our actual results may differ from those predicted.

Some of the factors that may cause them to differ are included in our 2012 10-K.

Our presentation will also include non-GAAP financial measures, and we have provided reconciliations to the most comparable GAAP measures in our earnings press release, which is available on our corporate website at www.nytco.com, under Investor Relations.

And now, I would like to turn the call over to Mark Thompson.

Thanks, Paula, and good morning, everyone.

Since I last spoke to you, I've completed my first full quarter at the New York Times.

We've also taken a number of significant decisions.

We've developed a new strategy for growth at the Company.

We've reorganized the Company to deliver that strategy and to optimize the delivery of our existing businesses.

We've announced the rebranding of the International Herald Tribune as the International New York Times' this fall, as part of our plan to find new audiences and new revenues outside the US.

And we've been marketing for sale the New England Media Group.

Now, in a few minutes, I will set out some of the detail of our new strategy.

I'll also provide guidance on how we expect the new growth initiatives to affect our business.

But before that, let me talk briefly about our first-quarter results.

Total revenues decreased 2%, as ongoing weakness in advertising revenues was largely, but not entirely, offset by continued growth in circulation revenues.

Operating profit was $23 million; and, excluding depreciation, amortization and severance, totaled $50 million, up 3% largely due to the strength in our consumer revenue stream, coupled with tightly managed costs.

Earnings per share from continuing operations, excluding severance and special items, were $0.04 a share compared with $0.05 in the 2012 first quarter.

Paid digital subscriptions totaled more than 700,000 by the end of the quarter, an increase of more than 45% compared to the same quarter in 2012.

The rate of increase was less than in the last quarter of 2012, though that is at least in part attributable to the volume of news, including the presidential election in that quarter.

Advertising in the first quarter of 2013 remained challenging; though, as you will note in our guidance, we are currently seeing some signs of improvement in the second quarter.

I've spent most of my time since I arrived as CEO of this Company working with my colleagues to develop a medium-term strategy for The New York Times.

I've looked both at our existing talent base and current operations and structure, and at many potential sources of future growth.

We've also listened carefully to consumers in their thousands.

What you will hear today is not my last word on the subject of strategy, but what I would describe as a significant first step in our efforts to put The New York Times Company on the path to sustainable growth.

We plan to grow our business by launching new products and services based on the unique strengths of Times journalism, and by investing in the rapid expansion of existing operations -- video and live events are examples -- where we are already seeing strong growth.

We want to deepen our relationship with our existing loyal customers, but we also want to use a wider family of New York Times products to reach new domestic and international customers.

New products under development as part of the strategy include a lower-price pay product designed to allow access to The Times' most important and interesting stories in a convenient, media rich package for consumers looking for an efficient way to stay informed.

Consumer research has suggested very strong demand for such a product.

Other the new products, also at lower price points, that would offer deep access and additional content and other new features in specific content areas, such as politics, technology, opinion, the arts, and food; an enhanced tier that would offer extras at a higher price point to all digital access and print subscribers.

Subscribers will likely be offered access to Times events, the ability to give subscriptions, and provide full family access, among other incentives.

Growing international subscribers is a second key component of our strategy.

By the sheer quality and breadth of its journalism, The New York Times has become one of the best-known news organizations in the world.

We believe that under a unified brand, there is a real opportunity to drive new international revenues, particularly through the acquisition of new digital subscribers.

So this fall, the International Herald Tribune will become the International New York Times.

We intend to invest in global marketing to build out our international subscription base, using the marketing practices that have helped us build our strong domestic subscription base.

We also plan to localize the purchase process, prices, and payment methods, to make it easier for international readers to subscribe.

We expect to attract high-volume users, especially those we term global citizens -- news consumers who have interests or ties outside their home country, and who seek an alternative or an addition to local media.

The development of a more robust and comprehensive video presence is another strategic initiative, which is still in the early stages of development.

We recently appointed a new General Manager of Video Production to lead the effort to scale our video business to satisfy the demands both of users and advertisers.

Over the past few years, we've been building an infrastructure and core competencies in the video space.

And in 2012, we saw significant gains in both the streaming and monetizing of the business.

We've already produced a lot of exciting work, including the Op-Docs series, which features short, topical documentaries; and a multi-award-winning feature, Snow Fall, which chronicle the story of a group of expert skiers caught in a deadly avalanche, enriched with embedded an topographic video.

We plan to continue to developing video series that build on the strength of our journalists and our popular sections like Arts and Culture, Style and Food.

And we'll continue, of course, to invest in video coverage of breaking news events.

Just this week, we began to offer free unlimited access to The Times' online video section.

We want to significantly increase our video presence.

And we'll do this by growing our offerings and broadening our distribution channels.

The fourth component of the plan for growth is through brand extensions.

We believe that The Times can leverage our key assets of brand strength, marketing prowess, and audience quality to generate incremental revenues by selling goods and services that match current reader and customer needs.

The planned areas of focus are games and e-commerce.

Last year, we began to expand our successful crosswords franchise, and we have added a sizable number of paying subscribers to our Web and mobile crossword products through minor products enhancements and increased marketing.

Based on this experience and market indicators -- which point to healthy growth of casual gaming users, especially in mobile -- we believe there is an opportunity to expand our footprint in this market.

While the landscape is fairly competitive, our research points to opportunities, particularly in the intelligent games segment.

And our users, products, and e-commerce system and marketing capabilities provide a solid and unique starting point for expansion in this area.

We've also been successful in generating revenue by selling branded products and services.

And industry trends lead us to believe that we can diversify both our product portfolio and services business and further grow our overall commercial revenue.

And expansion of our conference business, bringing The New York Times and IHT conference operations together for the first time, is also planned.

We reorganized the Company to deliver both these and subsequent strategic projects, and to ensure that we are managing our legacy operations as effectively as possible.

The new structure is intended to accelerate the delivery of our growth agenda; to promote more efficient decision-making; to unlock innovation; and to provide a special focus on excellence in plotting the future of our digital and print advertising business, and our print manufacturing and distribution operations.

We organize The Times' operations into three groups, each headed by a leader charged with addressing the group's particularly market dynamics and strategic challenges.

These groups are the Digital Products and Services Group, led by Denise Warren; the Print Products and Services Group, headed by Roland Caputo; and the Advertising Group, which for which we're seeking the right executive leadership.

We'll consider both internal and external talent for this position.

In addition to the focus on growth, all of these groups, and the corporate leadership of the Company, will also be charged with continuing to manage expenses aggressively over the coming years.

Despite the considerable achievements on this front in recent years, we believe there is further opportunity for cost reductions without damaging the quality of the journalism on which the Company's future success depends.

Turning to the impact of the strategy on our business, we expect it will generate strong revenue growth and improved operating profit over the long-term.

We estimate operating profit will be negatively affected by $20 million to $25 million in 2013, as a result of these initiatives, with a modest contribution to revenues while we make significant investments to build out and ramp up.

Investments will largely be for product development and subscriber acquisitions, along with significant new capabilities in product management, customer management and distribution.

We expect these growth initiatives will be largely based on organic investment, although we will not rule out tuck-in acquisitions of properties that align with our strategy and accelerate growth in key digital segments.

I mentioned the quality of The Times' journalism a moment ago.

Last week The Times was awarded four Pulitzer prizes for its international, investigative, and explanatory reporting and for feature writing, more than any other news organization for 2012.

In that same week, we see saw brilliant coverage by this Company's journalists at The Globe, The Times and the IHT, of the tragic events in Boston.

In a world where so many other news providers are struggling to maintain quality and accuracy, we believe that the gold standard of reporting that The New York Times and its sister titles stand for is becoming a critical point of distinction and a competitive advantage.

It is the rock on which we plan to build a successful future for the Company.

And with that, let me turn the call over to Jim Follo.

Thanks, Mark, and good morning, everyone.

Our Company maintained positive momentum in its circulation business in the first quarter, but that incremental growth was offset by the challenges faced in the advertising side.

The steady build of The Times' digital subscriptions, combined with January's print price increases, managed to partially offset the advertising losses, resulting in total revenues declining 2% in the quarter.

That said, revenue challenges were more than offset by cost management in the quarter, bringing operating profit before depreciation, amortization and severance to $50 million, a 3% increase compared to the first quarter of 2012.

Circulation revenues rose 7% for the Company, and 8% for The Times Media Group in the first quarter, with the monetization of our digital products contributing most significantly to that increase.

Circulation revenues also benefited from home delivery price increases at The Times for early this year.

The Times continues to benefit from improved retention rates for home delivery circulation following the launch of digital subscriptions, despite these price increases.

Further demonstrating the value readers place on digital access, which is provided free for all Times print subscribers, we continue to see growth in The Times Sunday home delivery circulation volume, which ticked up slightly in the first quarter.

Against the backdrop of continued growth and circulation revenue, the difficult advertising landscape did not show signs of abating in the quarter.

Advertising revenue continues to be affected by ongoing secular trends and an increasingly complex digital marketplace that is undergoing a shift towards ad exchanges, real-time bidding, and other programmatic buying channels.

To that point, in the first quarter, print advertising revenues decreased 13% and digital advertising revenues were down 4%.

Rounding out our results for the quarter, operating expenses before depreciation, amortization, and severance decreased about 3%; and on a GAAP basis, were down 4%, both in line with our guidance.

We reported an operating profit of $23 million.

GAAP costs in the quarter benefited from the absence of accelerated depreciation expense that we booked in the prior-year period.

Diluted earnings per share, excluding severance and special items, were $0.04 in the first quarter compared to $0.05 in the first quarter of 2012.

Now, let me provide some depth on our first-quarter results.

Total advertising revenues decreased 11% year-over-year, and were down 10% in January, 6% in February, and 17% in March.

Both print and digital advertising experienced particular difficulty in March.

First-quarter print advertising revenues decreased in national, retail, and classified categories.

Digital advertising revenues also decreased, as growth in automotive classified category was offset by declines in national, retail, and the remaining classified categories.

Overall mobile advertising was challenged in the quarter due to the timing of some campaigns, but has turned around significantly since then, and we expect robust growth for the second quarter.

Turning to The Times Media Group, total revenues were down 1% in the quarter, with circulation revenues up 8%, and advertising revenues down 11%.

The other revenue line was up 5%, partially due to better performance in digital archive business.

The overall advertising revenue decline was the result of print losses in all three major categories -- national, retail, and classified.

Pressure on the national ad category, by far the largest at The Times, was again responsible for the bulk of the Group's decline.

While the retail category saw modest growth on the digital side, both retail and classified categories were down on an aggregate basis.

Digital advertising revenues for The Times Media Group trended lower, due to the increasingly fragmented landscape.

Digital display advertising continued to experience challenges, including from the programmatic buying issues I mentioned earlier, along with a glut of available ad inventory in the market, causing downward price pressure.

While such audience-targeted approaches are affecting premium pricing for advertising environments, such as NYTimes.com, we believe that The Times Media Group, as Mark outlined today, can return to digital advertising growth by making significant inroads in video advertising; through substantially increasing our inventory; by focusing more heavily on unique custom ad units; and by better monetizing our tablet inventory.

Even as pay product strategy continues to evolve, The Times' digital strategy remains centered on growing its subscriber base while extending its brand on a wide range of platforms.

As of the end of the quarter, The Times Media Group, including subscribers to The Times and the ISD digital packages, had about 676,000 paid digital subscribers, an increase of 36,000 subscribers from the end of the fourth quarter, and more than 45% growth year-over-year.

Digital subscription acquisition growth was somewhat tempered in the first quarter, which marked the end of the second year of our paid products.

As we did not benefit from the same traffic level associated with the robust new cycle of the fourth quarter.

That said, our success to date with digital subscriptions has validated and expanded the market for paid digital products.

And our new initiatives will ensure that we remain an industry leader on this front.

Moving to the New England Media Group, total revenues were down 7% in the first quarter, with circulation revenues down 2%, and advertising revenues down 10%.

Other revenues were down 9%, primarily as a result of lower revenues from direct mail advertising services.

In addition, in the second quarter, The Globe will begin to cycle higher commercial printing and distribution revenues and the associated costs in connection with printing and delivering a local competitor that began last year.

Print softness drove the decrease in overall advertising revenues in the first quarter, particularly in the retail category, which also declined on an aggregate basis.

While the classified category is down overall, automotive classified saw a digital boost in the quarter, driving aggregate digital classifieds into positive territory.

The national category saw the smallest decline for the quarter.

As of the end of the quarter, BostonGlobe.com had 32,000 paid digital subscribers, an increase of 4000 subscribers for the end of the fourth quarter, and more than 50% growth year-over-year.

The Globe has also announced that it will raise its print home delivery prices beginning next month.

As we announced in February, we've begun the process to sell the New England Media Group.

At this point, while we can give no assurances, we expect to see a transaction sometime in the second half of the year.

We are pleased with the interest that has been expressed to date.

Turning to costs, we again delivered on expense management side in the first quarter, as cash operating costs, excluding severance, declined 3%, mainly due to lower compensation costs, raw material expense, and outside printing costs.

GAAP operating cost declined 4% as we began to cycle against $7 million in accelerated depreciation in the quarter, associated with the Worcester consolidation last year.

We will continue to be diligent in trimming expenses and managing legacy costs going forward, but will remain prepared to invest where appropriate, especially in light of the strategic initiatives Mark outlined this morning.

Raw material costs declined 10% in the first quarter, mainly due to lower newsprint consumption and declining newsprint prices.

Looking broadly at the financial impact of the new initiatives, while our strategy is designed to ultimately have a positive impact on operating profit, the effects will not be immediately evident.

In fact, we expect a contribution to operating profit connected to these initiatives will not move into positive territory until late 2014, and will not see a full-year growth until 2015.

That said, we expect some of the initiatives will begin to generate new revenues this year.

Moving to the balance sheet.

At the end of the first quarter, our cash and marketable securities totaled $866 million, exceeding total debt by approximately $168 million.

Just to reiterate what we said last quarter, while there's been a lot of focus in recent months on our significant cash balances and its potential uses.

Given the continuing challenges faced in the advertising environment and our desire to retain maximum flexibility, we feel that maintaining a conservative balance sheet remains appropriate.

In turn, we do not believe it is in the best interest of the Company to restore dividend at this time.

As we have said, one of our main priorities for cash is managing our pension-related obligations.

To that end, in the first quarter, we made about $61 million in largely discretionary contributions to certain qualified pension plans.

With our mandatory contributions nearly met for the next several years, and our underfunded gap slowly diminishing, we are likely to take a pause in making any additional discretionary contributions this year, as we monitor interest rates.

Moving to our outlook.

Second-quarter circulation revenues are expected to increase in the mid-single digits as we expect to see continued benefit from our digital subscription initiatives, as well as from the most recent Times price increases and the plant increases at The Globe.

In the second quarter, overall advertising revenue trends are expected to be somewhat better than the first-quarter levels.

And second-quarter operating costs are expected to decrease in the low-single digits from the same period last year.

And with that, we'd be happy to open it up for questions.

(Operator Instructions).

John Janedis, UBS.

Hi, thank you.

Mark, thanks for sizing the upfront investment this year for the initiatives.

I'm wondering, Jim, does the start of this flow-in during the third quarter, and based on your comments, is it fair to say there will be some form of loss, maybe, for the first half of 2014 as well, then?

I think we'll actually begin to see some costs being incurred in the second quarter, in fact.

It will be modest, but it will be several million dollars, and is already embedded in the guidance we gave up on costs in the second quarter.

I think we're going to prefer to keep our guidance on economics really limited to 2013.

We're too early to start talking about that.

But I did say in my remarks, we expect to see profitability gained in the latter part of 2014.

Okay, fair enough.

And maybe Denise, we haven't seen the kind of slowdown you reported in the print business on the ad side for a couple of years.

And I'm wondering, as you've had discussions with the advertisers to maybe start the year, did you get the sense that incremental portions of the budget were maybe being taken out of print into other media?

And was there any change in your annual rate card relative to trend?

Thanks.

So, I'll answer the second question first.

No, rates have sort of remained relatively stable.

But the biggest reason why we saw the impact we did in the first quarter was really a function of two categories, which are actually very large contributors to our overall base of business in the first quarter -- the entertainment category and the financial category.

And let me just take a moment to explain each.

On the entertainment front, the results are really impacted by, quite frankly, a nonexistent Oscar race.

I don't know if you recall last year, the Oscar race was rather strong; this year it was pretty lackluster.

That has a material effect on our business.

In addition, we are seeing less spending from the studios on sustaining campaigns, as their release window has shortened.

Financial was impacted by steep declines in banking, investment, and the credit card segments.

So those were really the primary reasons for the results in the first quarter.

And I do want to mention that we are seeing a different trend in the second quarter.

It is a better trend, as Jim had mentioned in the guidance, for both print and for digital.

Is that trend more broad?

Meaning, is it -- also include entertainment and finances, or is it the other categories getting better?

It's coming from everywhere.

Thanks.

Maybe one last question.

Mark, how do you size the addressable market for the lower-price pay product?

We're not going into detail.

We did extensive consumer research, and we think it's substantial.

The potential market is in the hundreds of thousands range, certainly.

Thank you so much.

Craig Huber, Huber Research Partners.

Yes, good morning.

I have a few housekeeping questions and a follow-on.

What was your daily and Sunday circulation volume change year-over-year for both your flagship papers, please?

Craig, it's Denise.

For The Times, daily was down about 6%, and Sunday overall declined around 2%.

I do want to mention that Sunday home delivery did rise slightly, marking the fourth consecutive period of growth for Sunday home delivery.

And, again, I'll just remind you that we did raise home delivery rates in January.

And on The Globe, Craig, daily units were down about 10%, and Sunday was down about 7%.

Okay.

And can you also give us some metrics on newsprint -- the consumption, the average price percent change there, year-over-year?

Yes, I'll quote the RISI number.

The RISI prices are down about 4% for the quarter.

We think that's probably likely to carry forward for a good part of the year, but we can't be precise.

So if you look at our total raw material costs are down about $3.3 million.

That would put about half that being attributed to the price, and the other half to consumption.

Okay, then also your corporate costs -- because you don't break it out anymore in the press release -- what is the difference there versus a year ago, please?

The number is -- I'm not sure I have it here on the year, but the number for the quarter is about $9 million.

We think that's a pretty good run rate for the rest of the year.

Okay.

And then also your commentary, please, on April -- what you're seeing right now, is it -- you said somewhat better.

But do you think it's down at a similar rate to the fourth quarter, or perhaps even better than that?

You're talking about advertising, Craig?

Yes.

Both in print and digital, we're actually seeing an improved trend relative to the fourth quarter on both print and digital advertising.

So, better that down 8.3% excluding the extra week.

You're saying it's tracking even better than that, you're saying.

Yes.

On a combined basis, yes.

Okay.

My last question, given the roughly $900 million of cash on your balance sheet, and your unwillingness to buy back stock or implement a dividend or a one-time dividend -- and forgive the question, but are you guys considering taking your company private?

No, we're not considering taking the Company private.

Okay.

Thank you very much.

Alexia Quadrani, JPMorgan.

Thank you.

Could you expand a little bit, or give us a bit more color on this new lower-price, pricing strategy for that the digital subs?

I'd love to hear your thoughts about how it may prevent, or how it won't cannibalize existing print subscribers, or get existing digital subscribers maybe to come down a bit to the lower-priced subscription model.

Any color on that would be great.

Alexia, I'll talk briefly; and then I'm going to hand over to Denise, who's going to be driving this forward for us.

It's really important to say that, as I said in my remarks, we're talking about lower-priced products, but we're also talking about an enhanced tier, which will be a higher-priced product, so it's a spread of prices.

The key discovery in our research has been, the people who get all digital access really want all digital access.

They really want to be able to get to every part of The Times' digital offering.

And we think, therefore, although we obviously -- we're going to think extremely carefully about issues of cannibalization and spin down and so forth, we think that there is very clear proposition which works for a large and growing number of subscribers with complete access.

We have identified a very substantial number of people who are very interested in a subscription to The Times, but at a somewhat lower price point, and with the recognition that will mean less than complete access.

And that's the core, really, of the finding; and why we believe there's a way of coming in, if you like, at a different point in the demand curve to reach a different segment of potential subscribers.

Let me pass you over to Denise.

The only thing I would add to what Mark said is that there is also strong demand for some niche products, as he also mentioned in his remarks.

So, we think there's an opportunity for that as well.

So it's a range of products that will be offered at a lower price point, Alexia.

Okay.

And just a couple more.

Following up on your earlier comments as well, on a different topic on further opportunities for reducing the cost -- any color you could give on where we could see that coming from.

And lastly, on your dividend comment, understanding that it's not a near-term event in terms of reinstating the dividend, did you have any sense of when that might come back under consideration?

Should we assume that's not really a 2013 announcement, or maybe back on the table next year?

Anything there.

Alexia, I would say in the first quarter our costs were down $11.1 million.

It was a pretty broad list of categories.

I would expect that to be the case as we go forward.

Now, so, I don't expect it to come really heavily from any one particular area.

It will just continue to be tightly managing across a broad spectrum of cost categories.

I will just say that, as we get deeper into the year, and we start spending against the initiatives, the mix will change.

But we kind of look at it like the core business and the growth business; and I think when we look at the core business, you would expect to see some pretty good, consistent, maybe not quite at the $11.1 million range of cost takedown, but you'll see us being pretty aggressive in managing that base of cost.

But, again, I don't think there's any one area that really sticks out as likely to contribute the most.

I would say, on the dividend, I think we're just going to maintain some flexibility.

We're going to keep saying what we've said for the last couple of quarters here -- is as long as the advertising market remains as volatile as it has been, we don't feel like we need to be debt-free; that's not what we're saying.

But we do feel like, at this moment, we feel like where our balance sheet right now feels right, just given the market that we're in.

We're going to continue to evaluate it without putting a timetable on it.

All right, thank you very much.

Kannan Venkateshwar, Barclays Capital.

Thank you.

Jim, sorry, not to beat a dead horse, but on the dividend front, what are the priorities for the cash?

Outside of dividends, you obviously have your debt maturities and you have your pension obligations.

But just to understand the thought process here, debt here, in terms of the coupon, is pretty cheap.

I don't know if you can come down to the market and raise something cheaper.

And on the pension front, your cash contributions -- obviously beyond a particular level, then you over-contribute.

It actually hurts shareholders, because if the rates move then you are over-contributed and you cannot get that cash back.

So, to that extent, sitting where you are right now, how are you thinking about the priorities for the cash going forward?

Well, let me say -- in my remarks, I said we were going to take a pause in contributions to our pension plan.

We acknowledged that you don't want to get ahead of the underfunded balance by putting money in, and have interest rates move in a positive direction.

So, we're going to take a pause there.

We acknowledge the fact that we don't want to get overfunded, money trapped in the plan; and that is not an efficient use of our cash, so we acknowledge that.

We actually feel good about the progress we made on the pension front, but it is still -- we went into the year with a $396 million underfunded balance, pre-tax.

I think the market has helped us.

I think interest rates have probably helped us, so it's probably down below that as we speak now, but -- haven't updated that.

Look, we've become a smaller company.

Our EBITDA has gotten smaller through the sale of Regional Group; through the sale of About.

We're obviously exploring the sale of New England Group and that means that the debt level we carry, at $700 million relative to existing EBITDA, we think is too high.

So we've clearly earmarked some of that cash for debt repayment.

And we'll explore opportunities to retire some of that debt ahead of its maturity.

But the return on that sort of investment is not terrific.

But we do feel like that level of debt, relative to the size of our business, is too high.

And that's all we have to say on that, and I'll just refer back to my other remarks.

Okay.

And on the advertising front, the other thing I wanted to check was, when I look across some of the classified categories, for example, and I compare that to some of your peers, your trends in general across most of the categories, not just classifieds, seem to be worse.

Partly, I guess, that's a function of the revenue mix, but is there also some element of concentration from one or two customers which is also playing into this?

Not that I can think of.

One of the issues, if you look at real estate, it's been a very -- which is one of our larger classified categories -- it's been a very tough market in New York, because there really hasn't been any new construction.

That is actually starting to change, so I think that will impact our results going forward.

But I think, relative to others, that might be part of the explanation for the difference in performance.

Okay.

Thank you.

And it appears there are no further questions at this time.

Ms. Schwartz, I'd like to turn the conference back to you for any additional or closing remarks.

Thank you for joining us today.

If you have any more questions, please call us.

Thanks.

Thanks, everyone.

Ladies and gentlemen, this concludes today's conference.

We thank you for your participation.