OGE Energy Corp (OGE) 2017 Q2 法說會逐字稿

Good day, ladies and gentlemen, and thank you for standing by. Welcome to the Oklahoma Gas and Electric Second Quarter 2017 Earnings Conference Call. (Operator Instructions) As a reminder, this conference call is being recorded.

I would now like introduce your host for today's presentation, Mr. Todd Tidwell. Sir, please begin.

Thank you, Howard. Good morning, everyone, and welcome to OGE Energy Corp. Second Quarter 2017 Earnings Call. I'm Todd Tidwell, Director of Investor Relations, and with me today I have Sean Trauschke, Chairman, President and CEO of OGE Energy Corp.; and Steve Merrill, CFO of OGE Energy Corp.

In terms of the call today, we will first hear from Sean, followed by an explanation from Steve of second quarter results and finally, as always, we will answer your questions.

I would like to remind you that this conference call is being webcast, and you may follow along on our website at oge.com. In addition, the conference call and accompanying slides will be archived following the call on that same website.

Before we begin the presentation, I would like to direct your attention to the Safe Harbor statement, regarding forward-looking statements. This is an SEC requirement for financial statements and simply states that we cannot guarantee forward-looking financial results, but this is our best estimate to date. I would like to remind you that there is a Regulation G reconciliation for gross margin in the Appendix, along with projected capital expenditures.

I will now turn the call over to Sean for his opening remarks.

Thank you, Todd and good morning, everyone. And thank you for joining us on today's call. Earlier this morning, we reported second quarter consolidated earnings of $0.52 per share, compared to $0.35 per share in 2016. The utility reported earnings of $0.43 per share, and our portion of Enable earnings were $0.09 per share. We have received approximately $70 million in distributions from Enable year-to-date, and earlier this week, Enable announced a second quarter distribution of $35 million, payable on August 29.

The company is performing quite well, and we have accomplished a great deal this year. Our team has provided superior response to the 4 significant storm restoration efforts we've had. The construction of our environmental compliance and Mustang modernization projects, we brought 2 rate cases to completion, announced a new 10-megawatt universal solar farm, our Redbud and McClain plants were ranked among the nation's top 20 performers. And OGE Energy was listed on Forbes' top 100 most trustworthy companies.

I continue to be impressed with our members' commitment to moving forward and remaining focused on the day-to-day operations of the company.

Our utility service territory remained strong and we've added approximately 8,400 new customers to the system, growing at our historical rate of 1%. The latest economic statistics put Oklahoma's unemployment rate at 4.3%, which is on par with the national average. And looking further at our 2 largest load centers, Oklahoma City's unemployment rate is 3.6% and Fort Smith is 4%.

On the operations front, our generation fleet continued to perform well, highlighting the benefits customers realize through a diverse generation portfolio.

On the expense side, our O&M costs per customer is virtually the same as it was in 2012, and we continue to make sure every dollar counts.

For many years, we have talked about our environmental compliance and Mustang modernization plan. When we started, the task before us was, we had 7 low-NOx burners, 5 ACI systems, 7 combustion turbines, 2 scrubbers, and 2 coal-to-gas conversions to install across the system.

I'm proud to say that by the end of this year, with the exception of the scrubbers and conversions, all the projects would have been completed and in service, on time and on budget. In fact, the overnight cost of the 462-megawatt Mustang project is now down to $355 million. I'm also particularly proud of the safety performance of the Mustang project, with over 800,000 work hours on the project, we've had no incidents or injuries. This is truly outstanding. The Sooner scrubbers will be in service in early 2019, and will be on-time and on budget as well.

As I mentioned, earlier, we were pleased to announce a $20 million investment in a 10-megawatt universal solar farm that will be built in Covington, Oklahoma. This project is a continuation of our successful pilot initiative, which we launched in 2015, with the installation of 2 universal solar farms at our Mustang site. Just as we took a leadership role in bringing the first wind farm to our state, we've continued by offering our customers the state's first community solar farms.

Our solar program gives customers that want solar power a more economical choice versus personally investing in a rooftop or private solar system. Construction's expected to begin this month with the farm operational early in 2018. The General Rate Case for recovery of our Mustang CT's will be filed in the fourth quarter and I believe this case has the potential to be a positive turning point in Oklahoma's regulatory environment and all parties are committed to making this happen.

Turning to Arkansas, we will file this month requesting a declaratory order that our new Mustang facility is in the public interest. And we expect that decision in the fourth quarter of this year. We will address cost recovery in our annual filing in October of 2018, under the new formula rate plan and new rates would be effective in April of 2019.

Continuing in Arkansas, we received a final order for our rate case on May 18, and the new rates were implemented on June 1. This was our first rate case in Arkansas in 6 years. Our rates there remain the lowest in the state and among the lowest in the country. And this case was filed under Arkansas' new formula rate plan, which going forward, will increase the efficiency of cases even more. And we expect the annual formula rate filings to begin again in October of next year. We are excited about the growth we are seeing in Arkansas, specifically, in the Fort Smith area. The Chaffee Crossing area has -- had approximately $1.5 billion in capital investments. The ArcBest Corporation finished its headquarter expansion. This week classes started at the new Arkansas College of Osteopathic Medicine; this facility includes a research wing and it's expected to have a $100 million annual economic impact. The Mars Petcare facility started a $70 million expansion in January, and the Glatfelter paper is retrofitting a facility that's expected to be completed early next year as well.

So including these investments and over the last 18 months, with these expansions, they represent significant increases to our demand. Roughly 35 megawatts in the Fort Smith region. Within the next 2 to 3 years, these and other investments are projected to add 1,500 jobs to the area.

Now turning to Enable. Enable's financial results on the earnings call Tuesday, they reported strong results for the second quarter. Enable continues to see strong operational performance. Ongoing contract execution, backed by strong rig activity in the SCOOP, STACK and Ark-La-Tex basins, contributed to higher volumes across all business segments for the second quarter of 2017.

Enable has significant scale and operational leverage in the SCOOP and STACK. The backbone infrastructure has largely been completed with previous investments. This operational leverage drives capital efficient expansion opportunities, allowing Enable to capture more volumes for less capital. So as a sponsor of Enable, we continue to be pleased with their performance. Enable is doing everything it was set up to do and there is significant, untapped value in this business, and we are excited for what the future holds.

So before turning the call over to Steve, I do want to take a minute to acknowledge that although we have been providing the same update for quite a while, I'm proud that we aren't talking about surprises. Surprises about delays, surprises about cost overruns, surprises about injuries or incidents. Quite simply, we are getting things done. And we are getting things done in an environment where we don't necessarily control variables like weather and the actions of others. Those things sometimes overshadow the progress, the improvements and the growth we are achieving. So I want to commend everyone in our company for getting the job done and executing that safely.

Thanks to their continued achievements, our customers benefit from some of the lowest rates in the country and I'm proud of the work they do. We are committed to executing on our strategy, to continue growing our business, growing our communities and creating long-term shareholder value for all of you.

So thank you, and I'll now turn the call over to Steve to review our financial results. Steve?

Thank you, Sean, and good morning, everyone. For the second quarter, we reported net income of $105 million or $0.52 per share, as compared to net income of $72 million or $0.35 per share in 2016. The contribution by business unit on a comparative basis is listed on the slide. At OG&E, net income for the quarter was $86 million or $0.43 per share, as compared to net income of $72 million or $0.36 per share in 2016. The second quarter gross margin at the utility increased approximately $1 million, which I will discuss on the next slide.

O&M decreased approximately $8 million due in part to the timing of plant maintenance, as well as storm costs that were moved to a regulatory asset. We are focused on cost control and anticipate to be under plan for the year. Depreciation decreased approximately $5 million, due to the reduction in depreciation rates approved in the Oklahoma rate order, partially offset by additional assets being placed into service.

AFUDC has increased $5 million, due to higher construction work in progress, related to our environmental compliance projects and the Mustang modernization. Finally, income tax expense increased $7 million on higher pretax income.

Turning to the second quarter gross margins, while utility margins only increased approximately $1 million for the quarter, strong growth was offset by below normal weather. Compared to the second quarter of 2016, cooling degree days were 9% lower, reducing margin by $9.5 million. Compared to normal, mild weather reduced margin by $18 million for the quarter. Offsetting the mild weather, new customer growth increased gross margin by approximately $4 million and wholesale transmission revenues increased $3 million, compared to the second quarter of 2016. We also had increased industrial and oilfield sales along with increased demand revenues that combined to add another $3 million to gross margin.

Moving on to the regulatory schedule, as we've said before, our plan is to file a rate case in the fourth quarter of this year to pick up Mustang. The investment for Mustang is approximately $390 million including AFUDC and ad valorem taxes. The test year will be ending June 2017, with rates implemented in mid 2018. We will file again in the fourth quarter of 2018 to pick up the scrubbers and Mustang gas -- Muskogee gas conversion. The project investments are approximately $542 million and $76 million respectively, including AFUDC and ad valorem. The test year will be ending June 2018 with rates implemented mid 2019.

In Arkansas, we anticipate the first formula rate plan filing will be October 1, 2018, with rates implemented in April of 2019. The first formula rate filing will be used to recover the Mustang investments.

Turning to our investment in Enable. For both the second quarters of 2016 and 2017, Enable Midstream made cash distributions of approximately $35 million to OGE. Enable contributed earnings of $18 million or $0.09 per share, compared to breakeven results in the second quarter of 2016. Enable had a solid quarter. The gross margin increased as a result of higher volumes across all business segments. This was achieved with ongoing contract execution, backed the highest level of producer rig activity they've had on their system in 2 years. At the same time, their distribution coverage improved to 1.13x.

Turning 2017 outlook, guidance remains unchanged. At the utility, and assuming normal weather, we predict earnings per share to be at the low end of the earnings range of $1.58 to $1.70 per average diluted share. As you know over half of earnings will occur in the third quarter.

As a reminder, guidance includes approximately $0.06 per share for rates implemented on July 1, 2016, through December 31, 2016. The 2017 full year impact of the rate order is approximately $0.14.

That concludes our prepared remarks, we'll now answer your questions.

(Operator Instructions) Our first question or comment comes from the line of Paul Ridzon with KeyBanc Capital.

Can you kind of give a highlight of maybe some of the discussions you've had with the Oklahoma commission ahead of the rate filing, in particularly issues around depreciation?

Sure. So when you said depreciation, are you referring to the depreciation results out of the last rate case?

Yes, yes. Sorry.

Yes, yes. So we have had ongoing discussions with the commissioners and staff, about the depreciation schedule. We've provided some documentation about kind of what the actual life of these assets was, historically, has been. And I think there's a better understanding about the -- the actual useful life of a number of these property assets. And so we're working with them to kind of work on a gradual plan to get that back in line.

Thank you. And, on Mustang, you said that the costs came down, you said $355 million but later in the presentation, I heard $390 million?

Yes, so the $390 includes AFUDC and then the ad valorem taxes with it.

So the $355 million is the cash cost?

Yes. Paul, just to be clear. It's $355 million, did you say to $255 million?

3, 3. Yes.

3 yes, 3, just making sure.

You are doing really well there -- you're great there, yes.

(Operator Instructions) Our next question or comment comes from the line of Shar Pourreza from Guggenheim Partners.

So I think, Sean, you answered my question around the -- and why you seem a little bit more constructive on the upcoming rate filing for Mustang. Can you just remind us, assuming that you don't get a constructive outcome, and the last rate case wasn't an anomaly, how you're sort of thinking about how you deploy capital within the state on a go forward basis, more importantly, how you're thinking about the fourth quarter 2018 rate filing?

Sure. So a good question, and again, I appreciate you asking it. We are optimistic. I do believe this is going to be a positive turning point in Oklahoma regulation. It's been really constructive in the past and I think it's going to be really constructive in the future. So I am optimistic about that. But Shar, as we've said, we have many opportunities under consideration, primarily around our distribution system, from low voltage transmission to a lot of customer focused technology in both states. We do have -- and we prioritize our investments really around the opportunity that we can take costs out of the business, and provide some value to customers going forward. But the return is important, it's a key criteria. And we have to have a clear line of sight to how we're going to recover these investments. We have that in Arkansas, we're very comfortable there, and we are going to begin investing and deploying some of these technologies that benefit our customers in Arkansas. In Oklahoma, we're going to get through some of these other investments and make sure we have line of sight before we go down that path.

That's helpful. And then Sean, just on the line of sight, what's sort of that inflection point on, and how you think about your capital program on a go forward basis? Is it this fourth quarter rate case would give enough confidence where you could potentially revisit your capital program, which is declining obviously, by methodology? But is it this quarter, is it this year's rate case? Or is it next year's rate case where you would build enough confidence to maybe...

Yes, I think it's a momentum factor. I think that's a fair point and I think you should expect us to begin gradually layering that in as I mentioned, in my remarks, I have, I believe that beginning in 2019 and beyond, it will resume more historical average CapEx numbers. But again, I want to hold that until we have clear line of sight to those investments. But like I said, we'll begin layering that in, in Arkansas next year, and then probably the following year on in Oklahoma, assuming things continue.

Our next question or comment comes from the line of Neel Mitra from Tudor, Pickering.

Sean, I wanted to address the topic of pre-approvals. So I know a lot of your investments are being deferred, just because you don't have a line of sight on recovery. When will that change? Does that require legislation to play through or do you think that conversations with the commissioners will lead to better results with that? And how does the commission view it right now, in terms of how important that is for you to go forward with capital spending?

Thanks, Neel, good question. I think the commission is -- has a good appreciation now of how important that is to us, what that means in terms of raising capital to fund these investments. We do have, recall, we do have the approval for the Sooner scrubbers, and we will file for that rate case to actually get in rates, but we do have the determination already in hand on that. But these other investments, I'm talking about around the grid, I think those are investments that we're going to show the benefits of customers. And all customers will realize those and recall is -- as disappointed as we were in the last rate case, we were -- we had $1.6 billion of request in that rate case and all of that was approved. Right, so it's not been a case of disallowance, Neel, it's been a case of some of these -- just the time delay it took to get there, and in this last case, it was ROE and depreciation.

Right. And secondly, are there any FERC investments that you can make, that give you a better line of sight in Oklahoma at this point, or any riders within Oklahoma which that will allow you to get a better line of sight and make investments before we get a little bit more constructive regulation?

We're certainly looking at all those options. Right now, as we look at the SPP there's -- to be perfectly honest, there's not a lot of activity. They were, as the RTO, we were very aggressive building a lot of transmission early in the decade. We built a lot of that. And there's not a lot on the books, but we're always looking at things like that.

Okay, great. And last question, I know CenterPoint's call is coming up in 30 minutes, but what is it going to take to, I guess, get alignment from CenterPoint and the OGE management team on Enable going forward? We saw the Enable share price go down, roughly 10% after the 13D filing on -- that CenterPoint would sell some of their shares on the open market. Have you had discussions about that and kind of what's the best course going forward for Enable in terms of enhancing both CenterPoint and OGE value, assuming that both ownership stakes are unchanged?

Yes, so really good question. And yes, I did notice the Enable unit price fall that much with the 13D filing. We spend a lot of time together, obviously, with Enable. And we are focused on seeing Enable do very well. I think the issue around alignment, I think -- and you need to speak to CenterPoint, they need to speak for this, but my view is we're both aligned around wanting Enable to do well. What -- obviously, we have different strategic views of our own portfolios and what we think the role Enable plays in that. And that's just -- that is entirely up to CenterPoint to make that decision and we make our decision. As far as the actions that have gone on, things like that, yes, we have had that discussion. And I think -- for what it's worth, we share Enable's concern about all that.

Our next question or comment comes from the line of Anthony Crowdell from Jefferies.

Just, I guess, Sean, I want to jump on Shar's question earlier, and I think -- I believe it was his question about a tough decision from the commission and maybe the momentum is going in your favor. But am I correct thinking even back to like 2011, you had a case, where I think the ask was like $79 million and you were awarded like $2 million. I mean, it doesn't seem that the commission -- it's just a short-term change. It looks like it's been a period of 7 years of just -- they may not disallow, but they're not really giving the utility an appropriate return on their investment. Is that accurate?

I think, this has been -- we've talked before on previous calls, these regulations seems to run in cycles. And I don't know if it's been 7 years but yes, it's not been as constructive as it has been previously. And that's something that I believe is going to turn and begin to get better.

Okay. And you spoke about, I guess, the utility's ability to really manage O&M or -- I don't know if it was keep it flat. When do we think we're kind of squeezed all of the toothpaste out of the tube, I guess, with O&M savings?

Well, I don't know that you've -- you ever do that. I take the view that every day we got to be getting better, and doing something either faster and better than we did it the day before. And so that's kind of the mindset, that's how we look at things. And we don't have any big bangs out there of initiatives. It's just roll your sleeves up and good old-fashioned hard work. We've been able to make investments that have taken costs out of the business. We've been able to make investments that allowed us to work more efficiently. I mentioned before that when we look at our company and compare the number of people that were here 10 years ago, we've been able to manage our workforce through attrition, and then still achieving a higher output of performance. So I want to see that model continue. I don't want to put a cap on it, Anthony, to say it won't keep going, I want it to keep going.

Okay, and just I guess, if I focus on the commission, there was a OCC reform bill, it was tabled, it was supposed to be an executive order from the Governor. Is there any update on that?

No update other -- that's exactly right. I think the Governor's office wanted to do an executive order. They said they're going to do it, and I view that order imminent.

Our next question or comment comes from the line of Brian Russo from Ladenburg Thalmann.

Just to follow up on that last question and answer on the Governor's executive order. Is it just pending, and it's on, I guess, her things to do, she just hasn't executed it yet?

Yes. I mean, I don't know any more than that, that the Governor's office indicated they wanted to do this executive order, and I believe they're going to do it. And I don't know in your words where it is on the desk but I believe it's going to be imminent.

Got it. And just to clarify your comments on building momentum with the commission. Examples of that is your actual conversations with them, and their better understanding of costs of capital, and investment, et cetera. Is that accurate?

Well, yes. And I think my momentum comment, I was referring to kind of when we would begin layering in the CapEx table, is what they were asking for. And my response was we've got to generate that momentum. So it's not just 1 case, it's not the next case. You want to see that you've got a continuation of improving and constructive regulation. But the relationships are good. There's a lot of dialogue going on. And I think this, what we've done -- what we will do in this Mustang filing is, it's very straightforward and very simple. It's really around the Mustang plant. And that makes a lot of sense, and we have a lot of support for it.

Okay, Got it. So to be clear, you don't need reform to be more optimistic in this next upcoming rate case?

Correct.

Our next question or comment comes from the line of Charles Fishman from Morningstar.

Housekeeping. Why were wholesale's transmission revenues up? Can you give a little more color on that?

It's just recovering of costs have -- that have been spent over time. And it's really our formula rate true-up each year, and wind speed too, those costs, as those come in, and we've had a few other small transmission projects. As they've gone into service, the formula rate has picked those up and driven the wholesale transmission revenues.

So it's investment that the tracker was just catching up with?

That's correct.

Okay. And then a second question. Sean, you made the comment during your prepared remarks about the untapped value of Enable. Is that comment based on frustration over the unit price, the uncertainty of CenterPoint's ownership, operations, the distributions, what was that comment -- where do you think the untapped value is?

A good question, and appreciate your question. The untapped value is, is we see a lot of growth in that business. And you've heard that from the Enable team. I'm really proud of Rod, and what they've done over there, managing through that downturn and commodity cycles and looking forward of what they have on their plate. So I think there's a tremendous value there. Recall that we own 60% of the IDRs and we're anxious to get into those, and so when you look at where they're operating and playing, we've been making infrastructure investments in those areas for many years. So their multiple there as far as what returns they're going to get out of investments, the investments primarily have already been made. So they're going to do, I think -- they're very well positioned. Now, as far as the externalities, yes, I'd love to see the unit price higher. But I'm really proud of what they've done over there. And they had a very good quarter -- another very good quarter. And they're building momentum.

Is the -- we've seen $35 million as your portion of the distributions each quarter this year, is that consistent with your -- when you had given 10% dividend growth at OGE, is that $35 million distribution consistent with that? That, that supports that?

When we made that decision to grow the dividends here at OGE by 10% through 2019, we certainly stressed under a lot of different scenarios what could come out of Enable from a distribution standpoint. But $35 million is right in the ZIP Code.

Our next question or comment comes from the line of Gregg Orrill from Barclays.

I didn't quite catch what -- when you were giving the OG&E guidance, what the $0.06 related to?

Sure. That's actually the portion of 2016 earnings associated with that order which we actually booked into 2017 because the order didn't come until 2017. So we have had reserved that portion and then we booked that into 2017. So $0.06 of our 2017 results relate to the second half of 2016.

Our next question or comment comes from the line of Joe Zhou from Avon Capital Advisors.

Sean, it's Andy.

You've got a name change.

I'll just leave that alone. But so just 2 questions. So just back on Enable. So are you -- because they're saying obviously, that they're still trying to sell it. So can you just give us an update on exactly where your process with them stands, and whether you're still interested in buying up their portion if it were available?

Yes. What I'll do, Andy, I'll tell you. Where they're at in their process and timelines and decisions, I would refer you to them on their call. I think they pointed to this call that they were going to make some -- clarify some things. I think that would be appropriate. My interest and our interest in Enable is really around positioning Enable for the future and making sure it's firing on all cylinders. And so, we're a holder of Enable, we're a long-term holder and we like it and we're going to do whatever we can that would help maximize Enable's value and our value.

Okay. And then just separately, just as far as OGE is concerned, just your thoughts on M&A in general?

Yes. So I appreciate the question as always, Andy. We're not going to comment on that. I just don't think there's any upside to that. And we'll just leave it at that.

Our next question or comment comes from the line of Paul Ridzon from KeyBanc.

Paul?

Sorry, about that. O&M was a positive for the quarter. You mentioned something about plant outages. Is there a timing issue and when would those outages hit in '17?

It is a little bit of a timing issue, we would expect O&M to be a little bit higher in the second half of the year but I do expect it to come in a little bit under plan to help offset some of the below normal weather that we've had this year.

And then looking out a couple of years, when you're done with your big construction projects, I mean right now, Enable is kind of providing the equity for that projects. You should have some pretty strong cash flow. Kind of how are you thinking about that and the alternatives for that?

I think obviously, our choice is that we would make incremental investments that would be beneficial to our customers. We believe we have a backlog of those types of investments that are grade enhancing, customer -- bring customers value, and we're just waiting on good signals from a regulation standpoint to make those investments.

Are the big generation projects kind of displacing that distribution capital in the near term?

Sure, absolutely. Yes, we've definitely deferred capital on purpose to make headroom for these large investments that we needed to make for environmental compliance.

Is there a scenario where we could see longer runway on the 10% dividend growth?

You know, we don't want to comment on that at this point. As we get a little closer to that, we'll give greater clarity on that. But certainly wouldn't want to put anything out there that long term.

Our next question or comment comes from the line of Paul Patterson from Glenrock Associates.

So most of my questions have been answered, and I apologize if I missed this. But in terms of the, the rate case that you guys had and the lengthy -- sort of the unusual depreciation and the delay for the decision to happen, one might get the idea that perhaps, there's an issue with rate fatigue, or some resistance to the rate impact associated perhaps, with utility -- with utility rate increases. So I guess what I'm sort of wondering is I know you guys are very conscious of this issue and what have you. Could you just give us a feeling as to what you see the rate impact going forward with all this CapEx and rate base growth? And just in general, the total rate, is there going to be any efficiencies perhaps, that could be resulting from this or is it just -- how should we think about what you're envisioning for the rate pair impact?

Yes. So Paul, thank you for your question because that's -- we do run it through that lens of trying to minimize the impact to customers. And that's why our focus on our expenses is so important because that creates headroom to make these necessary investments and minimize the customer impact. When we started out this -- with this environmental plan, remember we had a court order that we said we had to do these things. We thought over the period of time it was maybe north of a 15% increase to customer rates. I'm over it when we are all said and done. Obviously, I mentioned that the cost for Mustang has come way down and a number of other of our compliance projects were under budget, so we're knocking into that, also being able to manage our expenses. Steve mentioned that O&M is tracking under. That helps. That all helps. So it'll be -- I think it'll be less than 15%, when it's all said and done. And so some of that's already been recovered. The other thing that I think is important to note is that what we originally requested was, we were looking for really preapproval on this, and CWIP to your very point where we could kind of smooth the impact out to customers and avoid some of these increases in single years. And so -- the commission at the time just wasn't comfortable with the complexity of all of the projects. And the size of all of the projects. So the agreement was we'd come back and -- over the next 3 years and have, rate cases every 3 years. Your point around rate fatigue, that's fair. But the benefit of that though is that the cases are much smaller, much simpler, and this case we'll be filing in this quarter -- or in the fourth quarter -- is about Mustang. It's very straightforward. So it's in service, it will be in service. It will be complete. The cost is significantly less than we thought it might be and so we feel really good about it.

I'm showing no additional audio questions in the queue at this time. I would like to turn the conference back over to Mr. Trauschke for any closing remarks.

Thank you, Howard, and I just want to say thank you for all -- to all of you for your interest and your participation on the call today. And I hope you all have a great day. Thank you.

Ladies and gentlemen, thank you for participating in today's conference. This concludes the program. You may now disconnect. Everyone, have a wonderful day.