Oxford Industries Inc (OXM) 2018 Q1 法說會逐字稿

Good day, everyone.

Welcome to today's Oxford Industries, Inc.

First Quarter 2018 Earnings Conference.

Today's conference is being recorded.

At this time for opening remarks and introductions, I'd like to turn the floor over to Ms. Anne Shoemaker.

Please go ahead, ma'am.

Thank you, Kelly Anne, and good afternoon, everyone.

Before we begin, I would like to remind participants that certain statements made on today's call and in the Q&A session may constitute forward-looking statements within the meaning of the federal securities laws.

Forward-looking statements are not guarantees, and actual results may differ materially from those expressed or implied in the forward-looking statements.

Important factors that could cause actual results of operations or our financial condition to differ are discussed in our press release issued earlier today and in documents filed by us with the SEC, including the risk factors contained in our Form 10-K.

We undertake no duty to update any forward-looking statements.

During this call, we will be discussing certain non-GAAP financial measures.

You can find a reconciliation of non-GAAP to GAAP financial measures in our press release issued earlier today, which is posted under the Investor Relations tab of our website at oxfordinc.com.

Please note that all financial results and outlook information discussed on this call, unless otherwise noted, are from continuing operations, and all per share amounts are on a diluted basis.

Our disclosures about comparable store sales include sales from our full-price stores and e-commerce sites and including sales associated with e-commerce/clearance sales.

Because fiscal 2017 had 53 weeks, each fiscal week in fiscal 2018 starts and ends one calendar week later than in fiscal 2017.

To provide a more accurate assessment of our fiscal 2018 comparable store productivity, we are presenting fiscal 2018 comparable store sales on a calendar-adjusted basis by comparing the fiscal 2018 period to the comparable calendar period in the preceding year.

Thus, comparable store sales for the first quarter of fiscal 2018 compares sales in the 13-week period ending May 5, 2018 to the 13-week period ending May 6, 2017.

And now I'd like to introduce today's call participants.

With me today are Tom Chubb, Chairman and CEO; and Scott Grassmyer, CFO.

Thank you for your attention, and I would like to turn the call over to Tom Chubb.

Good afternoon, and thank you for joining us.

During the first quarter of fiscal 2018, we executed well on our plans, and I'm pleased with the results that we achieved.

Our sales for the quarter finished at the high end of our range, and our EPS exceeded our guidance.

At the same time, we continued to enhance the ways in which our customers are able to experience our powerful portfolio of brands.

There's no better way to deliver our unique brand experiences than through our stores, restaurants and websites along with our select wholesale partners.

In the first quarter, we saw solid growth in our direct-to-consumer business, highlighted by positive consolidated comparable sales.

The strongest part of our direct-to-consumer business was e-commerce, where both Tommy Bahama and Lilly Pulitzer generated solid comp gains driven by increased site traffic.

With our high average order size and high gross margin in the e-commerce, growth in e-commerce is accretive to our operating margin.

While our bricks-and-mortar stores, like much of the industry, were impacted by the unseasonably cold and wet weather in many parts of the country this spring.

Our retail performance in areas where weather was good, such as in Florida, where we have a significant concentration of stores, was strong.

Florida, which had solidly positive comps, accounted for more than 1/3 of our brand's bricks-and-mortar comp sales in the quarter.

As we moved into the second quarter, the first quarter momentum we saw in our Florida stores spread across the country, and quarter-to-date comps at both Tommy and Lilly are strong.

Shifting to wholesale.

As planned, we made select wholesale door count reductions, primarily with department stores.

This was done to ensure that the customer experience at every point of distribution is consistent with the experience in our own direct channels, which we believe is incredibly important to maintaining the strength and integrity of our leading brands.

As a reminder, we also had sales from the 12 Lilly Pulitzer signature stores we acquired last year shift from wholesale sales in 2017 to retail sales in 2018.

With the growth of our DTC businesses and the wholesale adjustments I just mentioned, our DTC businesses represented 65% of total revenue in the first quarter of 2018 compared to 60% in the first quarter of last year.

This mix change helped drive a 120 basis point improvement in adjusted gross margins year-over-year.

To build on our positive momentum, we are continuing to invest in and enhance our compelling omnichannel brand experience and have achieved several important milestones.

Our all-new Lilly Pulitzer website, which represents the best digital presentation of the brand we have ever delivered through both mobile and desktop devices.

This new platform provides a faster, more fluid experience no matter how our customers choose to interact with the brand, and each visit is personalized for our guest based on her favorite prints, colors and what's in her closet.

The new Lilly website also has more features to connect the Lilly lover to our stores.

For instance, she can see information and receive emails on upcoming store events and can pick up her online orders at her favorite Lilly Pulitzer location.

For Tommy Bahama, our multiyear omnichannel IT infrastructure project continues to progress well, and our customers should see additional benefits from our recent investments in the form of an enhanced brand experience later in the year.

Improved data analytics and replenishment systems will ensure that we have the right product in the right store for our customer, and our new enterprise order management tools will make our omnichannel processes more seamless.

In addition to improving the brand experience for our guests, we have several initiatives underway aimed at broadening awareness of our brands and attracting new customers to our business.

Based on the strength of our brands, we know that there's an opportunity to increase our customer base, and we are making additional marketing investments in 2018 that focus on customer acquisition.

Our approach at Tommy Bahama is multifaceted, and we will be adapting and updating our strategies as we gather data and learn which tactics are most effective.

We are very early in the process.

However, we were very pleased with the results of Tommy Bahama's localized advertising campaigns in key markets, such as San Diego, Scottsdale and Naples, during the first quarter.

Tommy Bahama's restaurants also play an important role in introducing the brand to new customers.

In early May, we opened our second exciting Marlin Bar, this one located in downtown Palm Springs.

This 180-seat indoor-outdoor restaurant is anchored by an expansive mister and umbrella-covered patio that keeps our guests cool and comfortable in the sunny desert climate.

This new location is off to a great start.

We are actively pursuing additional Marlin Bar opportunities, and we are planning to open a couple in 2019.

The team at Lilly Pulitzer did an amazing job, creating a tremendous amount of buzz around the brand during the first quarter.

With customer awareness in mind, Lilly Pulitzer collaborated with Pottery Barn on an exclusive collection of home décor and furniture.

When the beautiful Pottery Barn catalogs featuring Lilly on the cover hit homes, we saw an immediate lift in traffic on our own website.

And Lilly's launch of its Swim line in mid-February was a big hit in 2 important ways.

First, our current base of Lilly fans have been clamoring for swim.

And based on the response to the product offering, it's clear we delivered what she was looking for.

Secondly, Lilly Swim is proving to be a fantastic entry point for new customers.

Even a woman who doesn't own a Lilly printed dress can see herself at the beach or pool in a colorfully printed Lilly swimsuit or coverup.

We also have some exciting store openings in 2018 at Lilly.

To highlight just a few: This summer, we will open at Whaler's Village on Maui; and later in the year, at Fashion Island at Newport Beach, California.

These locations represent important first forays on the West Coast.

We will also be opening on Worth Avenue in Palm Beach, where the Lilly brand was born almost 60 years ago.

By continuing to focus on providing our customer with a great brand experience, we generated positive momentum in the first quarter, particularly in our DTC businesses.

As I just mentioned, the second quarter is off to an even better start, and we continue to feel very good about future growth prospects evidenced by our increased outlook for the year.

I'll now turn the call over to Scott Grassmyer for a bit more on our Q1 results and more details on our guidance for Q2 and the year.

Scott?

Thanks, Tom.

On a consolidated basis, as Tom mentioned, increased sales in our direct-to-consumer businesses, which included a 1% comparable store sales increase, were offset by our planned decreases in wholesale sales.

Our Southern Tide business, which had a very strong first quarter, grew their wholesale business with the expansion of their signature store base.

There are now a dozen Southern Tide signature stores, including 4 exciting new locations in the Northeast.

In the first quarter of fiscal 2018, SG&A as a percent of net sales increased to 51% compared to 49% last year.

Approximately $3 million of the increase was marketing.

We also had incremental costs associated with the operation of additional retail stores, particularly at Lilly Pulitzer.

If you will recall, in 2017, Lilly acquired 12 signature stores and opened 6 new stores.

U.S. tax reform had a positive effect on our earnings in the first quarter with a tax rate of 25.5% compared to 40.8% last year.

Our adjusted EPS was $1.28 in the first quarter of '18 versus $1.12 last year and above our guidance range of $1.15 and $1.25.

Our balance sheet and capital structure remain very strong and support our growth initiatives and investments.

We saw our inventory balance increased about $5 million or 4% over last year to $132 million.

This increases support planned sales increases and the operation of 18 additional retail stores at Lilly Pulitzer.

We also ended the quarter with $211 million of unused availability under our revolving credit facility.

Turning to our outlook.

We initiated our guidance for the second quarter of fiscal 2018.

With sales increases in each of our operating groups, we expect net sales between $300 million and $310 million in the second quarter.

Adjusted earnings per share is expected to be between $1.75 and $1.85.

On a comparable basis, sales were $285 million in the second quarter of fiscal 2017, and adjusted EPS was $1.44.

Our third quarter remains our smallest sales and earnings quarter due to the seasonality of our Tommy Bahama and Lilly Pulitzer direct-to-consumer operations.

Therefore, we expect our third quarter earnings to be comparable to last year and expect to see meaningful direct-to-consumer growth in the fourth quarter.

We have raised our guidance for the full year due to our solid first quarter results and our strong start in the second quarter.

We now expect sales between $1.125 billion and $1.145 billion in fiscal 2018 and adjusted earnings per share in a range of $4.45 to $4.65.

This compares to net sales of $1.086 billion in fiscal 2017 and adjusted earnings of $3.66 per share.

Our interest expense is expected to be slightly less than $3 million, and our effective tax rate for fiscal 2018 is expected to be approximately 26%.

Capital expenditures, including $13 million in the first quarter of fiscal 2018, are expected to approach $60 million in fiscal 2018.

This will primarily consist of investments in information technology initiatives, new retail stores and restaurants and investments to remodel existing retail stores.

Kelly Anne, with that, we're now ready for questions.

(Operator Instructions) We'll hear first from Edward Yruma with KeyBanc Capital Markets.

I guess, first, just so I'm crystal clear, did the comp trend improve materially post-quarter end?

And maybe more specifically, in Tommy Bahama, kind of maybe walk us through some of the puts and takes on comp.

I know you talked about weather.

And then maybe, how is the promotional efficacy of the Flip Side promo is running versus maybe this time last year?

So I'll start with Tommy Bahama, and just since the end of the quarter and it has been pretty marked, the improvement.

I mean, we had a very, very good May, and that's continued on into June and up to today with strong comps in both Tommy and Lilly.

And I think there are a couple of things that have contributed to that.

One is sort of the more normalized weather patterns around the country has helped.

Secondly, some of the marketing activities that we've done.

We did a big catalog brand, catalog mailing piece that we sent out this year that we had a piece last year.

But this year, it's dual gender.

Last year, it was men's only.

We sent it to more people.

It's a bigger, more substantial book.

And we think that's helped a lot as well.

So we're really pleased with what we've seen in the second quarter.

And in the first quarter, as we've said, we saw good comps in places like Florida and Hawaii where the weather was good.

But as you know, in a lot of the country, it really was unseasonably cold and wet, and that we believe held our comps back.

Got it.

And a follow-up on Lilly Pulitzer.

I know that it was obviously a different type of promotion or collaboration than with Target.

But kind of talk about momentum post that.

Did you see a pickup in business when the Pottery Barn collaboration was running?

And has it introduced you to a new set of customers?

Well, we certainly -- it certainly exposed us to a lot of new customers, and that was the idea behind it.

If you think about it in terms of marketing, this is sort of a top of the brand funnel-type activity that's designed to promote awareness of the brand, and it did that in spades.

It also drove some business in terms of some events that we did to coincide with the launch of the Pottery Barn initiative.

So it drove some business.

It increased awareness.

And if you think about it, this was a marketing event that was huge and that we actually didn't pay for.

We actually get paid for doing this.

It's not a huge amount of money, and that's not the driver for doing it.

But it's certainly a good way to drive brand awareness.

And then the last thing that I would mention is I think it demonstrated to us based on the great results that Pottery Barn had that our customer wants Lilly Pulitzer home décor and furniture.

That's something that she's clearly given us permission to do, very receptive to it.

And I think that means that that's an opportunity for us going forward.

We'll hear next from Pamela Quintiliano with SunTrust.

So just a quick one, a clarification.

The weather impacts, was it similar at both Tommy and Lilly?

And have you seen similar magnitude of improvements quarter-to-date?

And then with the 1Q weather challenges, was there excess carryover inventory at either division that you needed to clear through?

And if so, were those markdowns taken in 1Q?

Or is there any lingering impact in 2Q?

So I'll talk first about the weather impacts and then I'll let Scott talk about the inventory situation.

But I think the weather impact -- look, Lilly was a little bit stronger across the board than Tommy in the first quarter.

But what happens is that Lilly's concentration is greater in Florida, so they benefited more from a strong Florida business proportionately than Tommy did.

And then in terms of what's happening in the second quarter, they're both pretty close in terms of how strong their business is, and it's quite strong.

It's really been good, very good for both of them.

We've been very happy with what we've seen, May and thus far in June.

And then Scott maybe can fill you in on the inventory.

Yes.

We're not too worried about the inventory situation.

The second quarter is a bigger direct quarter.

And as Tom mentioned, we're off to a very good start.

So we've got some really good momentum.

And I think our inventories are in line, and we have very brand-appropriate ways to clear any goods that are left, which is just a natural part of the business.

So I don't think we have kind of any inventory bubble because of the softness because I think the strength that we've got now is certainly taking care of that.

And keep in mind, I mean, we did have positive comps for the quarter.

It's not -- we were certainly pleased with the quarter given the overall circumstances and then, again, couldn't be more excited about what we're seeing in the second quarter.

And then could you also just comment, specifically at Tommy, how the women's is performing and maybe any detail you can give on year-over-year change in penetration there?

And then I know you mentioned Hawaii as a positive because they had more seasonal weather.

But given what's going on there, do you think it could have been better if there weren't issues on the Big Island?

So the -- on the women's business, they had a strong first quarter.

I think what we've seen is the book that I mentioned, that's more of a second quarter item that we dropped in May that last year was men's only.

This year has men's and women's, has really stoked up the women's even further.

So it's had a good first quarter, have an even better second quarter so far.

And then in addition to that, Pam, you may have seen this if you've been in the Fifth Avenue store lately, but we rearranged the floor a bit, created what we're calling a dress shop, which is a dedicated area where we have dresses hanging, and it makes it easier for our customer to shop those dresses.

And that's helping the business as well.

So a lot of good things happening on the women's front in Tommy Bahama.

And then in Hawaii right now, the business is really pretty strong.

Could it be stronger absent the volcano issues?

I guess it might be, but we certainly aren't complaining about where it is right now.

We'll hear now from Needham & Company's Rick Patel.

Just a question on your guidance.

So it looks like back of the envelope math shows that your fourth quarter guidance is in the ballpark of $1.20 or even higher, which is a pretty massive year-over-year increase, especially considering you're going to be lapping a 53rd week from last year.

So hoping you can provide some context on what's going on there in terms of underlying assumptions for DTC growth and if there are also any timing elements we should be keeping in mind for SG&A or taxes.

Yes.

Rick, yes, the tax rate, will, certainly will be lower than last year.

As far as DTC, we will have additional stores we opened during the year.

And we're having good gross margin expansion with some of the actions that we were sort of taking last year.

Additional actions this year on pricing, we think, will also roll through.

We're seeing good outlet margin improvements, which we think will continue to roll through the rest of the year.

So we're pretty bullish on the rest of the year, and we think the fourth quarter just sets up for a very good direct-to-consumer quarter.

And can you talk a little bit about Lilly?

As we think about the relaunch of your Swim line and your collaboration with Pottery Barn, is there any way to give a context on how much your new customer file increased in the first quarter?

And as we think about the rest of the year, do you have incremental drivers to keep that momentum going?

Or is it more flow-through benefits of the initiatives you had in the first quarter?

Yes.

I would say 2 things.

I think some of the activities that we did in the first quarter, like the Pottery Barn thing, probably have a bit longer fuse on them.

The Swim, you see almost an immediate benefit from.

And as we mentioned, that has been a good tool for acquiring additional new customers.

Pottery Barn drove some great awareness, and it drove some great business through some of the events that we did in conjunction with that.

But we think it'll also continue to have benefits through the year.

And then the most important thing, I think, is the way we set up this year in Lilly Pulitzer.

There's been a steady flow of events and launches and special pop-up prints and all kinds of things.

It seems like every week or 2, we've got something coming down the pike.

So just for example, in the first quarter, in addition to the Pottery Barn and the Swim, we have the Honda Classic down in Florida that we were a sponsor for.

That's a PGA Golf Tournament.

We've got lots of good buzz and did some good business around that.

We had the S'well water bottle collaboration that we've done before.

We, just recently, a couple of weeks ago, launched a small tennis capsule that we did some tennis-specific skirts and dresses and tops that I think created some good excitement.

We had another delivery of Swim.

We were basically sold out of the earlier deliveries.

We had another one that delivered for summer.

And so we've got a whole flow of these things.

We're driving a lot of excitement by using influencers, which is something that we sort of dabbled with in the past, but I think we've stepped on the gas.

And that's a very, I think, modern and brand appropriate way for us to reach our consumers.

So the short answer, Rick, is that I think some of the activities that we did earlier in the year will continue to benefit us throughout the year and beyond.

But then in addition to that, we've got a lot of additional things coming, and some of them we're not quite ready to talk about because we do like to surprise our customer and have something new and fresh and exciting for.

But there is definitely a steady flow lined up.

And just the last one for me on Tommy.

Tom, you talked about omnichannel and plans to offer an enhanced brand experience later this year.

Just curious if you can go into some more detail.

If you're a Tommy customer, what's going to change experience-wise versus what he or she would have experienced last year?

So as you know, Rick, we've had this IT omnichannel infrastructure project going on for a couple of years, and it's one of those things where you're doing a lot of foundational work that's really, really hard work.

And it's a big investment of both time and money and effort, but you don't really see a lot of results from that.

We're getting into the phase now where we're going live with some things that will really help us a lot.

So as I mentioned on the script, I think 2 of the things we're excited about that are coming sort of in the back half of this year are enhanced analytics and planning and allocation that will help us have -- do a better job of matching up inventory with what customers in specific locations want and then some functionality that will help streamline the omnichannel process.

So basically, when you go in a store and you're looking for a particular shirt in a size medium and maybe they don't have it in stock, it smoothes and facilitates that process of getting that shirt for you.

And then next year, we've got what I think of is even more exciting stuff that gets into some of the buy online, pick up in store, buy in one store maybe you have it, so you can pick it up in another store.

All these different permutations of things that people want to be able to do now, that will be coming a little bit later.

So we're sort of getting into the fun phase of the whole omnichannel IT project.

We'll hear next from Michael Kawamoto with D.A. Davidson.

So just on the Lilly flash sale in August last year, I think you put a little more on sales, you did some -- taking some discounted merchandise out of stores earlier in the year.

What are your expectations for the flash sale this year given you had a pretty big sale last year?

Yes.

It'll probably be a little bit larger -- similar size, maybe a little bit larger.

We do -- in the spring-summer season, we are able to buy a little more inventory, do a little more chasing knowing we have that big August opportunity where we have a very profitable exit.

So right now, we're planning the flash off slightly from last year in August, and we did $24 million last year in August flash.

And Michael, as you know, that is our primary liquidation vehicle in Lilly Pulitzer.

We -- our website is 100% full-priced product for 360 or 361 days a year.

We do limited in-store markdowns.

We don't have outlet stores, so the customer doesn't have many chances to buy Lilly Pulitzer at a reduced price, and there's a lot of pent-up demand out there when that flash sale rolls around in August.

Got it.

And then on Tommy, you've made some substantial improvements in recent quarters.

But can we just get an update on the Tommy outlet operations, how those are going?

Very pleased with the progress there, especially with our gross margin expansion in outlets.

That's been very strong.

I think our outlets look better.

And we would rather have higher gross margin, less highly promotional outlets.

And we're able to achieve that now.

(Operator Instructions) We'll hear now from Susan Anderson with B. Riley FBR.

This is Luke Hatton on for Susan.

So just generally, how does your -- the stronger sales momentum you're seeing and sort of the improved consumer confidence across the retail space, how is that affecting how you're thinking about store openings going forward?

Well, I think there are a couple of things that impact store openings.

So obviously, the improved consumer confidence helps.

Actually, the changes in the tax law help a lot because that's just right out of the box improving your after-tax sort of cash return on your investment that makes the math work a little easier and a little better.

At the same time, we are in an emerging omnichannel world where more and more business is being done online.

For us, that's a good thing.

As we mentioned in our prepared remarks, e-commerce business -- because of our high average order size and our high gross margins, e-commerce business is actually accretive to our operating margins.

So we don't mind growth in e-commerce.

And the trick going forward is to keep e-commerce and physical stores in the appropriate balance.

But there are lots of good opportunities out there for us.

We highlighted a couple again on the prepared remarks.

I couldn't be more excited about the Tommy Bahama Marlin Bar in store in Palm Springs, California that just opened.

And then in Lilly, we mentioned we've got Whaler's Village on Maui in Hawaii opening in a couple of weeks.

We think that's going to be a terrific store for us.

It's been a terrific Tommy Bahama location for many years.

And then we've got Fashion Island in Newport Beach, California going.

So we're starting to stake our claim to the western part of the United States in Lilly Pulitzer.

And then we've got a terrific store coming on Worth Avenue in Palm Beach, which is the home of Lilly Pulitzer going back almost 60 years ago.

So there will be new stores.

But at the same time, we see a lot of growth opportunity in e-commerce, and we're excited about that as well.

Got it.

And then just switching gears.

So where are you sort of in the process of transitioning Southern Tide over to the overall sourcing and distribution platform?

And then also for that website, is that still tracking to roll out in the first half of this year?

Yes.

So Southern Tide, I would say, is pretty much fully integrated at this point.

We're very, very pleased with the way that has all gone.

And the team is totally bought in to being a part of Oxford Industries, and we've totally bought in to having Southern Tide as a part of the company.

It's a great brand with lots of great opportunity.

They did transition to a new e-commerce platform during the first quarter, and e-commerce continues to be a great growth opportunity for them.

They saw growth during the first quarter, and their wholesale is growing, too.

So I think for the year, that will end up being about 20% of the business on e-commerce with good growth in both wholesale and e-comm.

We'll hear now from Dana Telsey with Telsey Advisory Group.

As you think about the wholesale channel, any more color on the wholesale channel by brand, ordering patterns and just what you're seeing there even in terms of promotion?

And then the accelerated pace of business you've seen so far in the second quarter to-date, is that more traffic, more conversion?

Where do you see that evolving?

And then just lastly on the Lilly Pulitzer Swim, how's that contribution in margin?

And where do you see it getting to as a percentage of the Lilly business?

Okay.

So wholesale sales, I would say that most of our wholesale partners, their businesses are actually performing pretty nicely right now for the most part.

And even though we're planning wholesale down for the year, we actually have, in some cases, more than a few where people are actually chasing goods right now, which is a positive to see.

Overall, for the long term, Dana, as you know, we value wholesale.

We're in the wholesale business, and we plan to be in it.

We do see more growth over time in direct-to-consumer, but wholesale markets seem to be doing pretty well right now.

Your second question was?

Second quarter.

Second quarter momentum.

Yes, it's -- its traffic has improved a good bit.

I think we were happy with conversion rates in the first quarter.

In several cases, they picked up and -- but I think the bigger drivers so far in the second quarter has been traffic has improved.

And then on Swim, that's going to be a relatively small category for us, but it's -- to us, it demonstrates that we can provide more of her needs for a day at a resort, so we can dress her not only in the morning at breakfast, for exercise, for dinner and cocktails in the evening, in the afternoon, but we can also dress her literally for the beach and the pool with Swim.

And so it rounds out our offering there.

I think the second thing that it demonstrates is how we can look at an opportunity, be innovative in the product that we're offering and then take an innovative approach to marketing, which we did primarily through influencers this time and really make it work for our customer, really make her happy, delight her in the process of doing that, do some good business.

On the margin structure, I don't know, Scott, if you want to comment on that.

Yes.

It's close to our apparel margins, and I think they'll keep getting better as the category does grow.

But it's good margin business.

And with no other questions, I'd like to turn the program back to Mr. Chubb for any closing remarks.

Thank you very much, Kelly Anne.

We have a terrific portfolio of brands and an incredible team of people that bring these brands to life.

By staying focused on providing a great brand experience to our customers, I'm confident we are well positioned to deliver consistent earnings growth and increase shareholder value over the long term.

Thank you again for your time this afternoon.

We appreciate your interest.

Look forward to speaking to you again after Labor Day, and I hope you have a wonderful summer.

That will conclude today's conference.

Again, thank you all for joining us.