Ranger Energy Services Inc (RNGR) 2021 Q1 法說會逐字稿

Greetings and welcome to Ranger Energy Services Incorporated First Quarter 2021 Earnings Conference Call. (Operator Instructions) As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Mr. Darron Anderson, Chief Executive Officer. Please proceed, sir.

Thank you, operator. Good morning and welcome to Ranger Energy Services' First Quarter 2021 Earnings Conference Call. Joining me today is, Brandon Blossman, as always, our CFO, who will offer his comments in a moment. First quarter presented some very unique challenges for Ranger. The compounding effect of several activity disruptions that I will talk about in a moment had a material impact to our quarter's performance. However, while we had planned for better results, the fundamentals of our business and performance metrics are all pointing in the right direction as indicated by our Q1 exit rates and the start to Q2.

As I walk through the business today, I hope to clearly communicate our challenges of the quarter, but to equally point out the current performance of our business lines. In addition, I will provide more details on the strategic opportunities that we've been working on as well as a reminder of the balance sheet improvement made since our last quarter. Starting out with our balance sheet. We've long-held to a three-pronged strategy, underpinning our intention to be the best M&A partner in our space. First, to be a top quality operator. Second, to be as efficient as possible in our cost structure and third to have an attractive balance sheet. To further enhance our balance sheet strength, we successfully monetized our DJ Basin operating facility for $13 million in a sale-leaseback transaction. With this transaction occurring in early April, it's not reflected in our Q1 ending balance sheet. This transaction has allowed us to reduce our revolver draw to zero lowering our net debt by striking 40% to just $18 million.

Concurrently, we entered into a long-term lease at attractive rates. So there will be no change to our DJ Basin operations. We are very pleased to have monetized this attractive piece of real estate to which the equity market was assigning little value too. Now moving on to our segments, starting with High Spec Rigs. On our Q4 call, I spoke about that we are experiencing within our High Spec Rig segment, which resulted in a 42% sequential increase in rig hours for that quarter. This strong activity continued until the last couple of weeks of December with last rigs paused as a result of customer consolidation.

Because we anticipated this interruption to be temporary in nature, combined with considerable new inbound calls for rigs, we maintained our staffing levels, while also preparing additional rigs for deployment. By the fourth week of January, our High Spec Rigs finally returned to the revenue levels that were being achieved prior to pre-holiday and customer consolidation shut down.

Unfortunately, we were only able to fully operate for 14 days until our North Dakota operations began to cease due to winter storm, Uri. On average, each of our 7 rig locations from North Dakota, the South Texas lost 7 operating days as the winter storm moved across the U.S., with operations not returning in full until February 23. In spite of these impactful interruptions for the quarter, our Q1 rig hours actually came in slightly ahead of our Q4 hours. This is a clear demonstration of the activity growth that would have occurred across Q1, if not hindered by activity and eruptions.

To better highlight this point, December of 2020 was our best month for rig hours in the fourth quarter, yet our Q1 March exit rate was 22% higher. Furthermore, as we have begun to implement price increases, we are starting to see the impact at March exit rates were $27 per hour or 5% higher than our Q4 exit. The last metric I want to highlight is the trajectory of our high-end 24 hour rig activity. At year-end, we are running five 24 hour rigs. At the end of Q1, we were at 7. And currently, we have just deployed the 11th rig with another 3 possible in the coming month. As evidenced by the combination of both hours and pricing increases, our growth is not coming at the expense of customer quality are undercutting competitive pricing. Rather, this is the continued manifestation of the groundwork we have been laying over the last 3 years in high-grading our customer base to those top-tier clients, that are willing to pay for value rather than just settling for the lowest quoted rate.

Sustainable pricing that supports training, maintenance and acceptable return levels is good for the entire industry, both E&Ps and service providers. On the expense side of the equation, note that our activity ramp was during the disruptive events previously mentioned. Meaning, we were already carrying extra non-revenue ramping expense which did negatively impact our Q1 bottom line.

Next, move it to Completion and Other Services. Starting with Wireline. Here we see a similar story to the High Spec Rigs. During the quarter, our wireline business averaged 6.3 active truck, a 12% increase and a nice growth rate for the business. However, our total stages were down 10%. This data point highlights the level of interruption experienced in the quarter and the resulting inefficiency.

Winter storm Uri was even more impactful to our wireline business, as activity not only stopped for 7 days due to weather, but was followed by another 3 days of startup issues due to sand mine delays. Additionally, last quarter I spoke of our first simul-frac trial with a select customer. To date, we have now performed simul-frac operations with all of our customers. While our clients are now implementing this type operations as a go-for-it practice, our first quarter and even April was highly inefficient as customers had not yet transitioned their well pad design for consistent simul-frac operations.

While we are excited for the return of our historical efficient operations, our excitement is tempered by the continued low pricing within the wireline market to date. We are confident that pricing levels have reached bottom, with select examples of price increases being successfully implemented. We feel this service line is now at its prime for consolidation, a point I will talk about in my closing comments. To round out our Completion and Other Services, the activity levels of our remaining smaller rig service lines were relatively flat to Q4 with a proportionate decline to the loss of weather days. And finally Processing Solutions. The top-line for this segment was sequentially down $100,000 due to the release of led gas collars in the quarter, some of which are then returned to rent during the month of May at higher rates. As I've stated before, the traditional use of its asset lag, drilling and completion activity. Given the increase in commodity prices and growing activity levels, we expect greater utilization of these assets as we move further into 2021. While the traditionally use of these assets has been closer to a midstream application, we are now bringing these assets to completion operations. We have successfully completed gas processing jobs for both dual fuel and e-frac fleet and anticipate more to come.

There are several rewarding attribute to this transition. We intangibly contributing to the ESG efforts of our industry. We're able to accomplish this with our same technology and asset base requiring only minor modifications to increase their mobility for frequent moves. And based on early results, Processing infill gas for fuel applications is yielding considerable savings to our customers. While we are in the early innings of a long transformation, we are in a great position of owning a strong applicable asset base required negligible levels up incremental investment.

I will now turn the call over to Brandon for detailed discussions on the numbers.

Great. Thanks, Darron and good morning to everybody on the call. Let's go ahead and do the standard walk through of the first quarter details. First, on the consolidated numbers, Q1 consolidated revenue was came in at $38.3 million, down 8% or $3.2 million as compared to Q4's $41.5 million. Consolidated adjusted EBITDA went to just negative at a $200,000 loss, which was down $3.4 million from Q4's $3.2 million print. Note, that in our reported non-adjusted EBITDA, it was higher than our adjusted number by $1.4 million. This delta reflects the inclusion in EBITDA, but not in adjusted EBITDA of a $1.4 million benefit, reflecting forfeited 401K matching amounts that were expensed in prior periods. Also note, that this quarter's earnings similar to previous quarter did not include the addition or do sorry -- do include the additional expense of $1.1 million associated with high-spec rig reactivations. And now under the segment details, starting with revenue. High Spec Rig revenue was flat at $22 million, the result of a slight increase in rig hours offset by an equally slight decrease in composite rig rates. Specifically, revenue hours increased from 43,100 hours to 43,200 hours, a less than 1% change.

As noted, both a slow January ramp and weather played a role in dampening the Q-over-Q hours increase. More reflective of the actual ramp we saw in activity across Q1 is the metric that Darron had just mentioned. The 22% increase in rig hours we saw at Q1's exit versus Q4's peak hourly run-rate.

Q4's average rig count was up 4 rigs to 65, but again, that metric has quite a bit of volatility both due to February's weather disruptions and some swapping out of customers as we moved to more 24-hour work. Quarterly average composite hourly rig rates decreased just slightly again, down 2% or $10 an hour moving from $503 an hour to $493 an hour.

Here, the quarter-over-quarter decline in pricing was the result of February's weather disproportionately hurting 24-hour work, leading to a mix shift for the month towards lower rate day light work. Specifically, on average, for the entirety of Q1, 24-hour work dropped to just 19% of total rig activity as compared to 26% for Q4.

However, that sequential drop was driven solely by February's activity. In March, 35% of the rig activity was related to 24-hour work, a recent high point. In Completion and Other Services segment, revenue saw a decrease of 17% or down $3.1 million to $15.5 million in Q1 from Q4's $18.6 million.

The other portion of or non-Wireline services, and this segment did see a modest revenue decline. However, the primary driver of this segment's decline was our Mallard wireline business. Here, our wireline business, our revenues down 18% sequentially, driven by a 9% decrease in composite price per stage along with a 10% decrease in period over period stage count.

The decline in stage count was countered to the 12% increase in the quarterly average truck count. This, as Darron detailed, the result of both weather and a temporary reduction in stages per truck day efficiencies as the simul-frac operations ramped up. Also note, the decline in pricing that we saw in Q1 was driven by a mix shift rather than any customer-specific price change, with some lower gun count work showing an increased percentage of the Q1 total work. And finally, at our Processing Solutions segment, revenues held nearly flat dropping a modest $100,000 quarter-over-quarter from $1.2 million to $1.1 million. And now on to segment level EBITDA and margins. Overall segment level adjusted EBITDA, this before corporate G&A came in at $4.2 million, a decrease of 40% or $3 million moving down from Q4's $7.2 million.

All segments showed decline, modest declines at High Spec Rigs and Processing Solutions and a more significant decline at the Completions and Other Services segment. On the margin front, consolidated segment margins again before corporate G&A were down from 17% to 11%. On the G&A front, G&A expense as adjusted was up $400,000 from Q4's $4 million to Q1's $4.4 million. This sequential increase was in line with historic first of the year increases that we generally see an employment tax along with some other non-periodic expenses. And now, to segment level for EBITDA. High Spec Rigs segment EBITDA decreased 7% or $200,000 to $2.7 million from $2.9 million in Q4, with margins moving down in tandem slightly from 13% to 12%.

And I'll note similar to last quarter, adjusting out the $1.1 million of make ready expenses we incurred in the quarter in this segment would have resulted in an EBITDA margin of 18%, just down from last quarter's as adjusted 19% EBITDA margin. And I'll note that these levels are towards the top end of our historic range for this segment.

At Completion and other Services, EBITDA was down $2.7 million moving from $3.6 million to $0.9 million. Margins here were down from 19% to 6% and this is the combined impact of weather disruptions, lower efficiencies and pricing as previously detailed. And finally Processing Solutions EBITDA decreased 14% or $100,000 to $0.6 million from Q4's $0.7 million, with segment margins only down slightly to 55%. And on the net income, for Q1, we reported a net loss of $8.3 million, a $1.6 million decrement versus Q4's loss of $6.7 million. This delta was largely in line with the net impact of the sequential adjusted EBITDA change, which here was partially offset by the benefit of the $1.4 million for a 1K forfeiture that we discussed earlier.

Now the balance sheet. First debt. Net debt did show an increase during Q1 moving up $3.8 million from year-end's $26 million balance to Q1's ending $30 million balance. This increase largely driven by $2.6 million incremental working capital draw, along with $1.2 million of CapEx expense obligations incurred during the quarter. As usual, I will note that we did reduce our term debt during Q1, another $2.5 million bringing Q1's ending balance to just $15 million.

On the CapEx front, Q1 was another quarter which we saw very little maintenance CapEx spend, again, this quarter totaling less than $200,000 across all business lines. On the gross CapEx side, we did purchase incremental new 24 hour rig ancillary equipment, spending here just over $1 million. The majority of this million dollars was seller financed had very attractive terms over a 36-month period. As with through the last quarter, during Q1, we did see some significant spending in High Spec Rigs on re-activations and upgrades. However, as we have historically, we continue to adhere to our high capitalization threshold, resulting in none -- resulting in materially none of these amounts showing up as capitalized.

Now on liquidity. We ended the quarter with $13 million of liquidity, consisting of an $11 million capacity available on our revolver and $2 million of cash. That was down $3 million from Q4's $16 million with the liquidity. However, updating those numbers to today, we are currently sitting on $21 million of liquidity, with no revolver draw on $20 million of capacity and $1 million worth of cash.

And lastly, just a quick post-Q1 update. As we noted and as Darron talked about, on our last quarter's call, we were working on a couple of sale leaseback opportunities. A smaller $3.5 million transaction was completed during Q1 and a larger $13 million transaction was completed earlier in April. The larger transaction has got of course reflected on our Q1 ending balance sheet. Pro forma for that transaction, our Q1 net debt would have stood at $18 million rather than the reported $30 million. As Darron noted, that's a dramatic decrease and that does bring us significantly closer to our net debt zero target.

And with that, I'll hand it back over to Darron.

Thank you, Brandon. So you will note that we pushed back earnings a couple of weeks this quarter. We had 2 specific reasons for doing so and expect to return to upfront you to reporting for Q2. Firstly, we wanted to have a full look at April in order to be able to share some incremental insights in real time. And second, we are currently working on multiple smaller M&A transactions. One of which we are hoping to have done by this earnings call. Unfortunately, this still has not yet closed, but the measurement period for completions is in days, not weeks. Given the likelihood of a couple of transactions closing prior to our next quarter's call, I thought it would be appropriate to share some detail around our current M&A thinking. Our acquisition strategy has been fixed and simple. We are focusing on potential counterparties with top-tier assets, who have a reputation for best-in-class service quality.

We are looking at both bolt-ons to our existing service lines and complementary service lines that extend our current core service offerings. Tactically, we believe in being opportunistic. There is a right time and a wrong time and each cycle to be acquisitive. And I'll note that what proved to be the right timing decision in the long run, it's often counter to consensus thinking at the time.

With that said, I'll share a bit about what we have on the front burner. Coincidentally, the deals and process that would rank with the nearest proximity to close or all wireline companies. We've spoken for a couple of quarters now about the unsustainable low wireline pricing we are seeing in the market. We are seeing competitors' bid work and their variable cost leaving low margin to support a management structure. Excellent small to mid-size organizations carrying proportionately high G&A cost structure are themselves actively looking for consolidation opportunities.

Our Mallard business with its proven operating success and streamline cost structure has risen to be a partner of choice for these types organizations. Looking forward, we are pleased to be participating in consolidation efforts that will add technology, scale and geographical diversity to our existing efficient platform. I'll stop there and note that no deal is real until close, but that should provide some useful flavor what is currently in the works.

With that, I'll wrap up my prepared comments and open the line up for questions operator.

(Operator Instructions) Our first question comes from Jason Bandel with Evercore ISI.

First question and thanks for all the data points that helped to illustrate the impacts from the winter weather and clearly a better exit rate coming out of Q1 and a nice ramp here in April for rates and hours in High Spec Rigs. But can you quantify further the revenue and EBITDA impact weather had on Q1? And as we think about the revenue progression of Q2, what kind of rig hour or growth do you think you guys can achieve?

Yes. So don't have the exact number for quantifying the exact weather amount. As I said in my comments, it was a combination of weather and the slow start to January ramping back up. And we had some consolidation with our E&P customers that occurred in the fourth quarter. And we had some pretty material 24-hour rig go down in the last couple of weeks of December and then in fire back up to until mid-January. Then, also on the wireline side, we had one of our simul frac operation did stop until the mid-January. So the challenges of January with combination of the weather, but along with somewhat of a slow start to January.

As we're coming into Q2 and really focusing on the rig that in my comments here, the ramps if I use the word significant is probably the right word to use. We're very pleased with what we're seeing right now. We're showing the average rig count I believe was 65 for Q1. As we're sitting here today in April, we're at 72 rigs. As we sit here in April with 11 of those 72 rigs working 24 hours. And with, we anticipate a minimum of a number now that 324 our rig going out. So translating that into hours is going to be a very, very nice pickup for Q2. Brandon, do you want to add to that?

So to answer succinctly, we have several numbers for the winter impact, the winter weather impacts that we saw in Q1. The problem is, is that as Darron kind have highlighted in his prepared comments, we are carrying a lot of additional cost and anticipation of the rig ramp that has occurred. And so, if I include those additional expenses as sitting idle, while the weather delayed our ramp, we get to a really big number for winter weather impact. To the three, it's almost not believable. So we really shied away from absolutely quantifying that because of that extra expense that we are carrying through this ramp period, which did materialize, but was delayed by the weather. So again, the range is wide in terms of what metric you we actually want to use and we again just decided to not quantify it exactly because there would be a paragraph of explanation underneath that specific metric.

Yes, it's always kind of hard to quantify those kind of numbers, especially early on the recoveries where incremental funky. I guess, next question on pricing. It just been kind of a hot topic this earning season as I felt tourist companies work to recapture some of the concessions that were made in the downturn. I know, you touched on a little bit in your prepared remarks. But can you talk more about the trends that you're seeing in both Rigs and Wireline for pricing? On the rig side is it being driven more by mix as completions were comes back 24-hour comes back or utilization improvement helping as well? And then on the wireline side, what gives you the confidence that you're at a bottom here?

So I would say from a timing standpoint, our rigs are probably a quarter ahead of our Wireline, from actual price increase if not a mix issue, just strictly price increases. So we started moving prices on Rigs actually towards the end of Q4 coming into Q1. And we're starting to see the full impact of that materializing now and are actually preparing for second rounds of that to occur.

Whereas on the wireline side, we just started to get our first improvement in the quarter of Q1 and towards the back end of the quarter of Q1. So again, that's why I'd say from a timing standpoint, it's about a quarter difference between the two. Definitely on the mix side, we're going to see on the rigs, a probably fairly decent step-up in rates composite rate when we report our 2 numbers and that will be combination of the actual rate increase we will see, but also the higher component of mixing in more 24-hour rig than the hourly rates just significantly higher on a 24-hour rig packages just from a normal daylight package. So you'll see composite rig rate reported in Q2. I believe the move up materially from what we've reported here in Q1.

And then, on the wireline side Darron?

On the wireline side, I think, look at that at kind of mid single-digits here for our initial price increases and those are tangibles. So that's why we feel like that pricing has bottomed out, because we've had some success. The market is still over too much capacity. So it will be I think a slower timeline for container moved pricing up, but at least we have come off bottom.

And I'll just add Jason. Your question of how do we know that pricing has bottomed? Certainly, we don't know absolutely. But as we look through the kind of the fourth quarter, as the second half of 2020 and into the first quarter, on our math looking at kind of over the fence at some competitors. We think that their pricing, they work at breakeven EBITDA at best and that was sustainable in 2020 and early this year with PPP money coming to our some of our smaller more focused competitors with that used and gone variable price -- pricing, variable cost pricing is not a sustainable business. So we assumed just that that from a macro and micro perspective that is not pricing that can continue to exist in this sector.

And then, the last one for me on simul frac. There's still seems to be some debate around the efficiencies that are gains and kind of the value created in doing simul frac jobs. Can you touch on what you guys learned from the simul frac trials that you are on and the financial benefit that you guys achieved from being simul frac job?

Well, I think the efficiencies are real. Again, we did our first trial job starting at the --towards the end of the December with one customer. To-date, all of our customers have completed simul-frac jobs and all of our customers are adopting them as the go forward processes. So the operators are definitely seeing the benefits of it. From the service side, we did see the benefit of it in Q1, spoken about the efficiencies. And that's because from a drilling standpoint, you need a minimum of 4 wells per pad to per simul frac to be effective. And the drilling rates hadn't got out in front. So we had situations where we would do a simul frac operation. The next pad we're moving to with 3 well pads, just that we had a crew and a truck that was not needed. That's led over into April as we've gotten into May. We feel like with these customers to adopt this process with the go forward process, they have adapted the drilling programs to run full bore on simul frac. And we actually have 2 trucks on location 2 crews running 4 simul frac, we're back to our normal type efficiencies and we're getting the benefit. So I think the benefit on the services side is still to come. The E&Ps got on that benefit that they are adopting this as part of their go-forward strategies.

Our next question comes from John Daniel with Daniel Energy.

Good to see the echo the comments before the step-up in April and really glad to see the progress on M&A. I know you can't name names and that's fine. But as you forward Darron, it sounds the way you're describing it, these are more tuck-ins as opposed to transformative. Do you think the strategy in the near-term will be more tuck-ins or do you think we'll see a transformative deal or given, well, are you looking at the bigger opportunities as well, obviously with their let you opine?

No. Great question. So, look, nothing is off the table John. And we've looked at what I would define as small tuck-ins that moved the needle modestly two transformative opportunities that moved the needle greatly. I think the near-term opportunities that we have while aren't transformative to an overall Ranger from a materiality standpoint to our Mallard business. They do moved the needle with our Mallard business. So we're excited about these opportunities. But to answer your question, yes. We continue to look at transformative deals. Yes, we're hoping to get these two of the finished line will be our part two. But the key word is first, right. And we hope to do multiple transactions. We positioned our balance sheet. And we continues to get a lot of inbound from smaller opportunities to us, I would say equal size of sometimes larger companies looking to partner up with Ranger and build a strong business together.

There is a universal scene with all the well service companies are now labor issues. And a significant number of them talk about the inability they're going to be miss their jobs, because they don't have the crews. That clearly one would then provides the backdrop to be more sort of on pricing. It sounds like you guys are taking the first steps of that, you have the backdrop of access of Forbes getting together. I mean, to me, it feels like that part of your business for the first time in a long time feels pretty good? Would you care to elaborate it? I mean, did I miss anything?

I would agree with you 100%. For the first time about that it feels very good. And our strategies of focusing on the top-tier clients, I think got said at too many times about pursuing super-majors. I'd even mentioned that we went to work for a new super-major in fourth quarter, as we did refer today. We first job we did with them in the fourth quarter. As we sit here today, we have four rigs working for them, three of them on 24 basis. So labor is tight, have we missed some job, that would call in we just how the crews?

Yes, we have. Have we raised rates on some lower work that we were doing, with the objective of moving those crews over? Yes. We view that strategy as well to mobilize our workforce and asset base to higher paying work. So it is a challenge, I think for our program (inaudible) work, we're loading out for 24 basis that we know staying out. We're able to go out and recruit the crews and get them on. But we have turned down some work that called in or more of a spot basis, because we just, we didn't have crews available.

And John just for fun these, the senior management team here is on, call it, we do need a little bit help on that.

I hope so. Well, I guess my final question. Darron, I mean look you have to strike the balance is leadership about growth versus returns. I mean at this point you what's sort of your mandate internally is it? Hey, guys try to push for that extra make up a number of 5% incremental rate increase, before you try to put on a rig or do you try to put out the rig to thank here of the customer, because they have a need? How are you striking that balance it out?

No, look. One of our objectives that we're going to be a strong cash flow generating organization. And well, to answer that question is I would expect that going into Q3, on the rig side, we are going to be back to pre-downturn revenue levels for our rig, so matching Q1 20-type revenue level. But, running less rigs and higher margin. So that's well answer that question.

Our next question comes from Daniel Burke with Johnson Rice.

Let me take my little budget the M&A Apple here as well. Darron, you talked about these near term high probability opportunities is existing a sector where we're kind of breakeven-ish EBITDA levels entering a recovery cycle there's going to be working capital requirements. How do you get comfortable with the cash generative nature of the deals you're looking at?

Can you take that Brandon?

Yes. So one the deals are going to be cash flow accretive likely from day one. And day one means that we've accomplished a good portion of the transition work, not all of it obviously. But all of this stuff is pre-mapped and have a good portion of it happens day one. So these businesses that we have on the front burner are expected to be cash flow positive. The majority of the consideration for the transactions that we have again on the front burner will be equity. So the cash-out will be a little to none, they will come with their own working capital as we move them over generally speaking. So there won't be a big draw on working capital day one or no draw on working capital day one, cash flow positive day one. So they should be accretive to kind of all the metrics that you would imagine from a credit perspective. Does that hit it?

I appreciate the insight as well. It's a kind of dual structure that's helpful to know going into what looks like pretty imminent probability of the closure. So I appreciate that that added preview. I guess the only other one I had left was plenty of indications, the press release and the call today pivoting back to the model putting indications on where the rig business is, could you talk a little bit about the Completion business. It wasn't clear to me if some of the fits and starts related to the simul frac activity of your customers was fully cleaned up as we entered April or whether their considerations to take into account when we think about revenue trajectory on the completion side?

So, in the month of April, we had one of our core customers who we had a unit down for 2 weeks due to the solid frac business start. It had since returned back to full simul frac for the rest of the year. So May forward, we believe this business start to simul frac is now in our rearview mirror. I think what we're seeing in our business. Overall, as we were coming out of this downturn, we saw the first response in activity to come to the maintenance side of our well servicing rigs that's why continues to grow. Then, we start to see the 24-hour size of our rig activity pick-up, that is continuing to grow. On the completion side, again, running a quarter behind, we think that next level of growth will start to occur here in Q2 and going into Q3. And I think that's just the way the operators are looking at their spin to get well back on from a maintenance standpoint. We'll continue to focus on more completion, that completion activity. And then we're starting to see the drilling activity to increase as well too. So I think it's coming back in those type of stages. And I think our wireline opportunities that we're looking at are going to be well-timed from a pricing and activity standpoint.

Thank you. At this time, we have come to the end of our Q&A session. So I would like to turn the call back over to Mr. Anderson for closing comments.

Great. In closing, I just want to thank all of you for your continued support. And as always, I thank our wonderful team members for the great job they do every day, from the sales to our corporate office. Operator, thank you. And that ends the call.

Thank you. This does conclude today's teleconference. You may disconnect your lines at this time. And thank you for your participation and have a great day.