Comscore Inc (SCOR) 2018 Q4 法說會逐字稿

Good day, ladies and gentlemen, and thank you for standing by.

Welcome to the comScore's Fourth Quarter 2018 Financial Results Conference.

(Operator Instructions) And as a reminder, this conference is being recorded for replay purposes.

Now it's my pleasure to turn the call to your host for today, Mr. Steve Calk.

Good afternoon.

Thank you, operator.

Before we begin our prepared remarks, I'd like to remind all of you that the following discussion contains forward-looking statements within the meaning of the safe harbor provision of the Private Securities Litigation Reform Act of '95.

These forward-looking statements include comments about our plans, expectations and prospects and are based on our view as of today, February 28, 2019.

We disclaim any duty or obligation to update our forward-looking statements to reflect new information after today's call.

We will be discussing non-GAAP measures during this call, for which we have provided reconciliations in the appendices of today's press release and on our website.

Our actual results in future periods may differ materially from those currently expected because of a number of risks and uncertainties.

These risks and uncertainties include those outlined in our 10-K, 10-Q and other filings with the SEC, which you can find on our website or at sec.gov.

I'll now turn the call over to comScore's CEO, Bryan Wiener.

Bryan?

Hello, everyone.

Thank you for joining our fourth quarter and full year 2018 financial results call.

I'm joined by Sarah Hofstetter, our President; and Greg Fink, our CFO.

Together, we'll take you through our Q4 results and outline our vision for 2019, which is both ambitious and optimistic, as we look to build on our momentum from the second half of this year.

The headline today is our strategy of becoming a trusted currency for planning, transacting and evaluating media cross-platforms is working.

comScore is uniquely positioned to help content providers and advertisers grow in a dynamic environment that's becoming less influenced by historical inertia that has characterized the measurement marketplace.

Within this new world, our position is that of an enabler, working with our partners to unlock new ways of doing business and driving growth.

With that, I'm excited to report that Q4 was a marquee quarter for comScore and a strong finish to a pivotal year and our path forward.

While we are not declaring victory, we do believe today's report is yet another proof point that we're on the right track towards building a business that can deliver improved revenue growth with expanding margins over time.

Revenue in Q4 exceed our expectations due to a strong selling quarter as well as excellent delivery on our solutions.

Here are some highlights from Q4.

TV and cross-platform revenue increased more than 30% year-over-year.

We believe our position as a modern and viable currency alternative will only improve as traditional TV and premium digital video converge.

We also signed landmark deals with major local TV station groups that we believe will greatly accelerate our adoption as a buying currency in 2019.

Within Ratings and Planning, revenue for our syndicated digital products was down only 1% sequentially in Q4, exceeding our goal of low single digit declines.

And finally, we continue to tightly control operating expenses and reallocate savings into key strategic initiatives that we believe will help transform our business in 2019 and pave the way for incremental revenue to flow to the bottom line in 2020 and beyond.

Before I turn this over to Sarah, I'll summarize by saying, we've achieved what we set out to do in the second half of this year and are now in a position to continue our transformation.

In 2019, we plan to invest in 3 key areas: first, a technology transformation, which is well underway that will streamline and modernize our systems, while lowering our operational cost beginning in 2020; second, a customer-centric product roadmap across all lines of business, with a focus on driving momentum in TV and cross-platform solutions.

We believe we can bring significant value to the media companies and advertisers as they move away from age and gender to addressable and outcomes-based transactions; third, a reimagine go-to-market approach and a new strategy for engaging brands and agencies that we believe will begin to pay dividends in the second half of 2019, as we head into 2020.

I'll now turn the call over to Sarah -- our President, Sarah Hofstetter.

She joins us from a major marketing conference in San Diego, where she was a featured presenter alongside Taco Bell's Global Chief Brand Officer.

Sarah?

Thanks, Bryan.

As Bryan mentioned, I'm currently on-site at the ANA Brand Masters Conference, which is an annual gathering of Fortune 500 marketing executives and their senior agency partners.

I believe that the future growth and success of this business will be driven by adopting a more customer-centric mindset and prioritizing solutions that solve the emerging needs of the market.

As a trusted third-party measurement provider with a wealth of cross-platform data assets, we are in a unique position to solve the biggest challenges in media today.

I want to take some time to paint a picture of the media ecosystem as our customers see it and explain why comScore continues to be such an important growth ally for our partners on both sides of the market, buyers and sellers.

There are 3 major trends shaping our customers' business and therefore, our own.

First, the shift towards advanced TV.

Advanced TV essentially means bringing digital-like precision to the television ad buying format, whether someone is watching, This Is Us on a set-top box, on Hulu on their mobile phone during the morning commute or stream it via YouTube TV on their living room TV at night, it's all the same to the consumer.

But the buyers and sellers, this level of fragmentation presents friction.

Friction that is generating a need for modern currency to provide trusted cross-platform measurement.

Fragmentation is something our customers in the local TV market have been grappling with for years.

In fact, fragmented viewership in local markets is why station groups continue to rely upon and expand their usage of comScore currency.

In Q4, we signed expanded group-wide currency deals with Nexstar, the second largest station group in the U.S., Gray Television, NBCUniversal-owned television stations, which includes Telemundo-owned stations and The E.W. Scripps Company.

We also rolled out a new local TV planner product in beta ahead of schedule, which we believe will support our continued adoption efforts on the buy side.

This momentum in local as well as accelerated product development in cross platforms has assured a much larger conversation around comScore as a viable currency alternative within the advanced TV landscape.

In fact, we believe each step away from traditional linear TV transacted on age and gender moves us closer to a jump-all opportunity in which comScore has clear competitive advantages in the form of unique cross-platform data assets, differentiated data analytics and the digital pedigree needed to become currency in the new environment.

At Investor Day, we mentioned that NBC announced they were using comScore as their first buying currency in OpenAP, which is a network-led consortium designed to lead buyers to more precise audience-based transactions.

NBCU continues to innovate in the advanced TV environment.

And earlier this month, they announced that they would transact a TV campaign on business outcomes for the first time ever.

To connect the dots, they tapped comScore to link viewership data with movie ticket sales from Fandango.

The shift to more precise metrics is one that plays directly into comScore's deep digital expertise and vast cross-platform data assets, which are integral to connecting the dots from viewership to outcome.

Turning to comScore Campaign Ratings, or CCR for short, our flagship cross-platform ad measurement solution, we continue to push forward and are on track to transition from beta to a commercial offering.

Today, CCR has measured dozens of campaigns spanning billions of impressions.

In fact, I have breaking news.

We are announcing that CNN has become our first sell-side partner to emerge from beta to offer CCR commercially to advertisers.

Looking ahead, we are on target for launching our buy-side beta for CCR in Q2.

While we expect to start generating revenue from CCR heading into the second half of this year, our plans have always called for significant revenue starting in 2020.

As such, we are laser-focused on putting the building blocks in place to drive real market share gains over the next 12 to 24 months in the national TV market.

The second big trend impacting our customers is digital media disruption, specifically multi-platform consumer behavior and a heightened need towards commoditization as competition for ad dollars heats up.

In a complex and challenging environment, we must continue to evolve our core products to meet new needs.

We are focused on 3 areas to increase the relevance of our syndicated digital solutions.

First is measuring holistic publisher audiences across distributed platforms.

Our Q3 integration with Snapchat, for example, continues to prove powerful for publishers, who are amassing audiences outside their owned and operated properties.

We will continue to pursue similar partnerships that help publishers paint a complete picture of audiences across the digital landscape.

Second is expanding our measurement to include emerging formats and ad units within our existing product suite to improve relevance of our offerings among an installed user base of premium publishers and agencies.

Finally, we're continuing to see the benefits from our revised bundle pricing strategy, which helped contribute to a strong fourth quarter.

The third trend is marketing accountability.

Whether the pressure is coming from our Board, CFO, or client, brands under agencies have never been more motivated to deliver better results and do so more efficiently.

Marketing efficiencies fueled by better and more actionable data and thus comScore plays a pivotal role in an environment that is supercharged with an industry-wide need for more accountability and greater ROI.

That's why we anticipate continued growth in pre- and post-campaign activation and analytic solutions.

These trends, advanced TV, digital media disruption and marketing accountability form the framework of our revamped business strategy, and we have taken significant steps in Q4 and Q1 to operationalize customer centricity in our go-to-market.

In combination with overall business stabilization and accelerated products innovation, we believe these efforts bode well for our continued business transformation.

Over to you Greg to take us through the Q4 financial performance.

Thanks, Sarah.

Today, we reported Q4 revenue of $109.3 million, which compares to revenue of $102.9 million reported in the fourth quarter last year as well as $102.9 million in the third quarter of 2018.

As a quick reminder, in the third quarter of 2018, we began to analyze our customers and revenue by 3 solution groups: Ratings and Planning; Analytics and Optimization; and Movies Reporting and Analytics.

As we mentioned last quarter, we believe these new categories better reflect our customer needs and where we are focused.

For additional details about the products within each category, please refer to our 10-K.

Revenue from Ratings and Planning in the fourth quarter was $74.8 million, up 4% from the same period last year and up 6% compared to the third quarter of 2018.

In the quarter, we experienced continued growth in our TV products, offset by a 1% sequential quarter decline in our syndicated digital products.

Increases in TV and cross-platform products were driven by improving existing customer contract values in the period as well as a delivery of cross-platform products in 2 European countries that contributed $2.8 million in the quarter.

Of this, approximately $2 million was a one-time benefit for completion of product development.

Our syndicated digital revenue represented 50% of Ratings and Planning for the fourth quarter as compared to 60% in the same period a year ago and 53% in the third quarter of 2018.

As we have previously shared, we continue to focus on stabilizing our syndicated digital revenue through product enhancements, additional mobile data and a revised pricing strategy.

In the fourth quarter, we began to see some early signs of stabilization.

However, it will take a few quarters to validate these initial indication.

Revenue from Analytics and Optimization in the fourth quarter was $23.9 million, up 15% from the fourth quarter of last year and up 8% sequentially.

We continue to see robust growth in this category and particularly in Activation, in addition to good initial traction and new custom mobile products.

Also, our custom marketing solutions saw strong demand and solid execution of product deliveries in the fourth quarter, which tends to be seasonally strong as we complete many multi-quarter and seasonal fourth quarter projects.

Noted in the fourth quarter of 2017, execution was not as strong and it resulted in some revenue shifting to Q1 2018 upon project completion and customer acceptance.

Moving to Reporting and Analytics.

Revenue increased 1% in the fourth quarter compared to the same period a year ago, as we continue to maintain our global position and experienced solid contract values and renewal.

I'll now turn to operating cost, which I'll discuss on a non-GAAP basis.

In the fourth quarter, we continue to maintain our expense discipline across key expense areas with year-over-year changes related primarily to workforce optimization and other operating cost improvements.

Cost of revenues increased in the fourth quarter of 2018 compared to the year-ago quarter from higher data costs and expense of approximately $2 million in fulfillment costs associated with the delivery of the cross-platform products I described earlier.

These increases were offset by lower headcount and other operating costs.

Gross profit for the quarter was $58.4 million, a 54% of revenue compared to $53.1 million or 52% in the year-ago quarter.

Selling and marketing expense for the quarter decreased $26.8 million or 25% of revenue compared to $38.9 million or 38% of revenue reported in the year-ago quarter.

While the fourth quarter is seasonally higher as a result of increased sales commission, our expenses were significantly lower compared to the same period a year ago due to lower headcount, cost and reductions in other operating expenses.

R&D expense for the quarter was $17.5 million or 16% of revenue compared to $24.5 million or 24% of revenue in the year-ago quarter.

The fourth quarter of 2018 included about $1 million in capitalized cost.

G&A expense for the quarter was $16 million or 15% of revenue, down from $20.9 million or 20% of revenue in the year-ago quarter.

G&A expenses were lower compared to the prior year from reduced headcount, incentive compensation, legal and compliance costs.

We continue to focus in improving the efficiency around our administrative and accounting processes and strengthening our internal controls.

In the fourth quarter of 2018, we recorded a $6.7 million restructuring charge to reduce headcount in certain departments, which allows us to invest in other areas of the organization without increasing overall costs.

Also included in the charge is a $2.1 million noncash charge related to our lease rationalization efforts I described previously.

Subleases resulting from these efforts are expected to provide more than $7 million in cash to us over the remaining term.

We also recognized $892,000 of expense for items related to the investigation, and we'll continue to incur investigation-related expenses in 2019.

Fair value changes in our derivative instruments and equity investments resulted in other expense in the quarter as compared to income in the fourth quarter of 2017.

We could experience continued variability in this line.

Moving to our operating performance in the fourth quarter.

We reported a GAAP net loss for the fourth quarter of $27.2 million compared to a GAAP net loss of $71.9 million in the same period last year.

We reported adjusted EBITDA for the fourth quarter of $6.3 million.

This compares to an adjusted EBITDA loss of $8.1 million reported for the same period last year.

The fourth quarter improvement in adjusted EBITDA and a reduction of our GAAP net loss was driven by higher revenue across all 3 solution groups and lower expenses from the cost initiatives we undertook throughout the year.

Note that for the full year, our adjusted EBITDA was $16.4 million, an improvement of more than $35 million over 2017.

Our non-GAAP net loss for the fourth quarter of 2018 was $2.5 million.

This compares to a non-GAAP net loss of $6.4 million reported in the year-ago quarter.

In the fourth quarter, we modified our method of calculating this metric to add back amortization of intangibles.

We believe this revised presentation provides a better look at our core operating performance and have provided comparable amounts for the last 8 quarters in our press release.

We ended the year with cash, cash equivalents and restricted cash of $50.2 million, an increase of $5.1 million compared to the beginning of the year and a decrease of only $4 million from the third quarter.

We continue to closely manage our cash position and capital requirements and intend to move the company towards positive cash flow as quickly as we can.

We believe that our ability to access the capital markets is improving every quarter.

As I said in November, we will be focused on strengthening our liquidity position in 2019.

As such, we continue to consider our long-term financing needs in conjunction with our anticipated future cash generation.

In January of this year, the coupon on our senior secured notes reset from 6% to 12%.

As of today, we have not yet determined if we're making April 1 interest payment in cash, stock or a combination of the 2.

Many of the challenges in costs that we had in 2018 are now behind us.

We're building a culture around cost discipline and efficiency, while redeploying resources to focus on product innovation, transforming our technology infrastructure and revamping our go-to-market strategy.

Now let's shift to our financial expectations for 2019.

Today, we're reaffirming the 2019 guidance we provided at our Investor Day on November 13.

For 2019, we anticipate mid-single digit revenue growth with slight improvement in gross margins over 2018 and generally flat non-GAAP operating expenses relative to 2018.

We expect our adjusted EBITDA margin will expand in the second half of the year and come in at mid-single digits for the year.

We expect to self-fund product development to increase the efficiency and other cost initiatives.

We expect operating cash to turn positive later in the year and be neutral for the full year, although this could be impacted by our decisions regarding interest payments as well as SEC-related legal costs.

More specifically, for 2019, our anticipated mid-single digit revenue growth for the year excludes the impact of the one-time revenue increase in the fourth quarter I mentioned earlier.

Additionally, we expect the revenue cadence to improve throughout the year beginning with the first quarter that is expected to be slightly below last year due to the impact of the prior year execution issues I described earlier.

Since a significant portion of our cost of revenues is fixed, we expect gross margins to strengthen slightly from 2018 levels for the revenue growth throughout the year, primarily in the second half.

Similarly, we believe adjusted EBITDA as a percentage of revenue will begin the year in a low-single digit and improve throughout the year, such as the percentage for the full year is in the mid-single digit.

All of this underscores the power of our operating model.

We believe we can drive top line growth, while holding cost in check and generate significant adjusted EBITDA and cash flow over time.

With that, we'll open the call up for questions.

(Operator Instructions) Our first question is from Tim McHugh at William Blair.

Just I guess, maybe broadly, you talked about strength in both kind of the Activation and the TV side, which one, I guess, was really the surprising piece to you relative to the plans going into the quarter maybe?

Tim, it's Bryan.

I wouldn't say any of our growth was surprising.

It's just -- as you're operating a business, you have probabilities of certain things happen and just about everything good that could have happened in the quarter when we have upside, downside.

The upsides came in.

And as Greg mentioned, we also do quite a bit of work in, I would call, our custom solutions group, where we do custom analytic solutions and that requires selling as well as delivering by the end of the quarter.

And we really executed -- not only had a strong selling quarter, but executed near flawlessly.

So I think, Activation is -- it was very strong.

We expected to be strong.

It's still a very small business relative to what it should be given our data assets.

And I think that's a big part of what we've talked about previously is revamping our go-to-market on the buy side because Activation is bought from the programmatic trading desk at agencies as well as brands that have in-house programmatic.

The general awareness that we even offer this solution is extremely low in the marketplace, and we see that as a huge opportunity and that's a big part of Sarah's focus in revamping and rebuilding the team in the first half of 2019.

And that's why we actually see Activation to be a big growth opportunity as we look into second half of '19, heading into 2020.

Okay.

And then I apologize if I missed it in the broader discussion, but what's the way to think on the programmatic side of digital?

Where are you guys with your approach to kind of rebuild the market presence in that piece?

You're referring to syndicated digital business?

The old vCE type of product.

Oh, vCE.

So vCE, I wouldn't consider to be a programmatic solution.

vCE is a campaign measurement solution, which is principally focused on display.

What we've talked about is CCR is really video vCE and we're launching that to focus and our focus is really on the premium video end of the market.

What we have said is over time, we expect to merge vCE into CCR because they both have the same thing in that they're measuring delivery against of audiences for advertisers a different media properties.

And it's a currency product.

vCE has been principally focused on display where our CCR is now focused on premium video.

Our next question comes from Laura Martin with Needham.

Maybe a couple of things.

Congratulations on getting the CNN on the sell side.

Could you -- you're talking about in the second quarter how we're going to announce the buy side.

I'm wondering, if you have other metrics about making inroads into the buy side because that has been comScore's historical weakness versus the sell side.

And then Sarah, I'm interested from you and I know you spent a lot of time on the road when you first got there calling on all of these clients on both sides.

I'm sort of interested in from an insider's point of view, what surprised you as you went around like what you didn't anticipate from the outside that after you were talking to clients?

Because I sort of think, we've been hearing the same themes on Wall Street for the last 3 years about what score has to do?

So I'm interested in what you learned you weren't expecting as you went and called on clients?

Thanks, Laura.

So I'll start first and then Sarah can jump in on the second part of that question.

So you mixed a couple of things there.

One was in general specific to CCR and the other was a general thing on the buy side.

I'm going to talk about CCR specifically.

And I just want to make sure everybody kind of understands, with that product, there is a ton of excitement and our customers tell us that the only solution in the market that can measure unduplicated reach across linear television, OTT, desktop and mobile and provide co-viewing projections on OTT viewing.

Our plan from the start has been to launch with content providers, TV networks principally, 1 network at a time in order to build coverage and then launch the buy-side product that's going to allow advertisers to not only compare performance across screens, but allow them to compare across media properties, which is what they really want.

So while we will generate revenue from media owners on the sell-side product, the real revenue potential is coming from advertisers.

But in order for that product to be viable, you need to have enough networks launched in order for them to compare.

So we're taking a very methodical approach to get in, in each network first launched in beta and then commercially.

So just to explain more, we have lots of networks signed up, which we've announced.

But after that happens, we need to then tag their entire digital video infrastructure, which often includes third-party integrations and ad servers and other ecosystem players.

So with the way we're looking at this is each one of our networks is somewhere in our pipeline that we're pushing through on that infrastructure and launch phase.

And then once they're launched in beta, they then have a 3-month trial, where they're running campaigns where they're comparing their numbers versus our numbers.

And this is logical because CCR is a currency product, they want to be able to see how these compare before they adopt it.

So when we announced the CNN, that is the first partner that's moving from beta to commercial launch.

So you can consider CCR as a product is now at a beta even though most of our launch partners are still in beta testing.

So we're going to launch our buy-side beta, Laura, later in the second quarter.

We can do that even if we have 5 or 6 partners launch.

We don't need everybody.

For buy side to be commercially viable product, we need a lot more coverage than that.

I think that answered that part of that question.

But buy-side demand for this product is really -- had been extremely high.

It's a precursor as we need to get the networks up and running.

Sarah, you want to take questions -- the second part of that question?

Happily.

Hi, Laura.

So I think what surprised me the most was the delta between awareness and knowledge of the breadth of what comScore has to offer.

I think the industry has long known comScore, but the knowledge of the breadth of capability and mindset of partnership was certainly lacking.

And so whichever level I was going in, either on the direct brand side or on the agency side, that's probably where the biggest gap was.

But I think that represents fantastic opportunity because often we have -- open the door or we have a relationship that's highly transactional.

And so we can be a better consultative partner to them.

We believe we have a wealth of data and analytics to be able to help them with their business and as their business need shift, we can align with that.

Our next question is from Matthew Thornton with SunTrust.

Congrats on the results.

Maybe 1 question and then just 2 housekeeping ones.

I guess, first of all, some of those the recent local wins you guys have announced are around maturity.

I'm just curious if there was any impact from that in the fourth quarter?

Or if that's all still kind of forward looking as those kind of clients ramp further?

And then just on the housekeeping side, maybe for Greg.

Greg, you talked a little bit about the $2 million nonrecurring revenue in the quarter.

Any flow-through to EBITDA?

Or that in a similar, you also talked about a little bit of a shift from revenue, I think, it was in the A&O segment.

I think, you talked about some shift -- or some push-up from revenue from 4Q to 1Q.

Just wondering if you can -- maybe you can quantify that a little bit as well?

You got it, Matt.

I'll take the first one first and let Greg pick the other ones.

The short answer is, no.

The local deals that we announced are all 2019 impact deals.

Greg?

So on your couple of questions.

As I talked about some of the impact of revenue shifting, it wasn't a material amount that we recorded in Q1 2018, so we didn't really discuss it at that point in time.

As Bryan talked about, we executed extremely well this year where we sold and delivered.

The only reason we even are raising it as we think about the first quarter will have some small impact in the comparability between Q1 2018 and the Q1 of 2019.

So we just wanted to highlight that for transparency purposes.

On the international front what we talked about was we did deliver quite a few products in Europe.

And so the number I provided was $2.8 million, but then there was this one-time $2 million piece of it.

And as I explained, it was a $2 million expense side of that equation as well.

So as we build products, capitalize the cost as fulfillment costs, and as those products are delivered and we record revenue, the expense side, that capitalization comes off the books.

So when you look at it in totality and some that all of those pieces together, yes, there was positive adjusted EBITDA of $2.8 million, but the 2.2 -- the $2 million on both sides of the equation had no real impact to the company.

That make sense, Matt?

Yes, that does.

So just to clarify, it looks like $2.8 million on the revenue, but $2 million cost against that.

So that's very de minimis drop down to EBITDA.

And then, again, the shift from 4Q into 1Q in the A&O segment, it sounds like it's pretty small.

Is that fair?

Yes.

We just thought that as we start thinking about Q1, right?

And in my remarks when I talked about the fact that Q1 might be, our expectations, slightly lower than last year.

We felt that it was something we should at least share even though it's not significant.

Our next question is from Victor Anthony with Aegis Capital.

Guys, can you hear me?

We can.

Okay, great.

Two general questions.

One, your comment of significant revenue contribution from CCR in 2020, I was hoping you could just frame that a little bit better for us as we take a look at our models for next year.

That's one.

And you guys have had several wins against your primary competitor in the space, including one that was announced today on a conference call.

What are clients telling you, when they decide to at least drop your competitor and go with you?

Maybe you could just help us understand it better.

Sure.

I think you're referring to the CNN announcement in the latter part of your question?

Yes.

You could start there.

So I wouldn't characterize that as them dropping a competitor.

I'd say the CCR the beauty of, there's a new solution solving a major problem in the marketplace that's currently unsolved.

So I wouldn't characterize that as a taking market share from somebody else.

It's more about how we're providing a solution that is going to allow advertisers to understand how many different people are consuming their ads across all these different devices.

This is a huge problem in advertising.

So just to kind of clarify that.

And that leads to kind of the first part of your question, which is can we help you define significant?

Victor, it's just too early in the product line.

I mean, literally, CNN is our first paying customer on this.

I think, it'd be premature for us to start providing revenue projections for 2020.

I think that the main message, I think, what's important for investors to understand is that we are gaining traction in the market.

It's not instantaneous.

There's a methodical approach.

And the main focus -- while there will be revenue this year, the main focus for 2019 is getting breadth of network coverage and getting advertisers starting to use the product so that we are building market share.

And that will set us up very nicely for not only 2020 to 2021 and so on.

I think everybody would agree there's really no scenario where consumers are going to start consuming content -- fewer amounts of content on fewer screens.

It's only going in one direction.

The marketplace is getting more complex.

So the trend is our friend here.

We just need to be able to execute.

Well, thank you everybody for joining and we look forward to updating you next quarter.

Thank you.

Ladies and gentlemen, thank you for participating in today's conference.

This concludes the program, and you may all disconnect.

Have a wonderful day.