Stericycle Inc (SRCL) 2002 Q1 法說會逐字稿

Good afternoon ladies and gentlemen, and welcome to the Stericycle First Quarter Conference call. At this time our participants are in the listen only mode. Later we will conduct a question and answer session and instructions will follow at that time and if anyone should require assistance during today's call. Please press star followed by 0 on your touch-tone phone.

I would like to introduce moderator for this conference. This is Lewis Brendell, vice president of finance, please go ahead mam.

Statements by Stericycle in this conference call, which are not strictly historical, are forward looking. Forward-looking statements involve known and unknown risks and should you view the caution. That describes in the companies form 10-K as well as the other clients with the SEC, could affect the company's actual result and could forward the company's result to differ material from expected result. The company makes no commitments to disclose any rotations to forward looking statements or any fast advance for circumstances after this should made forward-looking statements.

And now to Mark.

Thanks .

Good afternoon and welcome to our first quarter conference call. Looking today in addition to Lewis are Frank Ten Brink, our CFO and Rich Kogler our chief operating officer.

I am pleased with the record results achieved by our team in the first quarter of 2002. Before the acquisition related cost and after pro forma adjustment for the adoption of FAS142, net income grew by more than 55.3 percent and EBITDA reached 27.1 million dollars. We finished the first quarter of 2002 with an EPS OF 48 cents per share up 42.8 percent over comparable measure of last year 34 cents. Every quarter since our IPO and 1996, 23 quarters and this quarter no difference; we would have met or exceeded our expectations for our company's performance.

For a brief overview I will turn the call over to Frank who will walk you through the financials.

We had an outstanding quarter. As revenues grew 11.2 million to 97.1 million up 13.1 percent from 85.8 million in the first quarter of 2001. Excluding acquisitions and (indiscernible) small customer revenues proved 9.5 percent and large customer revenues grew approximately 5 percent.

Customer mix excluding international machinery revenues of 2.7 million was approximately 8 percent in small and 42 percent in large customers. Gross profit has a percent of revenue increase from 39.7 percent in the first quarter of 2001 to 40.1 percent in the first quarter of 2002. The improvement resulted from better productivity and leveraging our infrastructure partially offset by higher insurance benefit and energy costs. SG&A excluding amortization was 14.6 percent of revenues vs. 14.4 percent in the prior year. Due to higher investment spending and French cost. Operating income before acquisition related costs and after the pro forma adjustment to 2001.

Results for of the FAS142 rose 14.3 to 24.2 million in the quarter from 21.2 million in the first quarter of 2001. As a percent of revenue, operating income to revenue increase from 24.7 percent to 24.9 percent. Other expenses in the quarter were 0.7 million which includes minority interests, franchise taxes and miscellaneous charges. Net interest expense was lower in the first quarter of 2002, than the first quarter of 2001, by approximately 3.8 million due to lower interest rates and lower debt outstanding.

The net interest expense in the quarter was also favorably impacted by a one time reversal of 0.4 million as a result of the exploration of 50 million and swabs. And the remaining 125 million hedged, the average 3 month LIBOR rate will be approximately 5.2 to 5.25 percent.

Next, net income in EPS. As a result of margin improvement and del-everaging, net income for the first quarter increased 111.9 percent to 10.6 million on an as reported basis vs. 5 million in 1Q last year. As reported, EPS increased 94.9 percent from 24 cents last year to 47 cents this year. The net income just at for the FAS142 changes and excluding acquisition related cost rose to 55.3 percent to 10.7 million from 6.9 million in the year earlier. On an apples-to-apples basis, I adjusted for FAS142 and excluding acquisition related cost, EPS increased by 42.8 percent from 34 cents in the first quarter of 2001 to 48 cents per share in this quarter. EBITDA increased to 27.1 million vs. 24.2 in the prior year. Our debt to EBITDA ratio on a consolidated basis was 2.5.

Next we will look at the balance sheet. During the quarter we continued to make progress in improving our balance sheet. The DSO improved from 66 days in the last quarter to 60 days this quarter. Our debt-to-book cap at the end of the quarter was 47 percent down from 50 percent in the year-end 2001. Through the end of the April 2002, we have repaid 30 million of our debts this year.

During the quarter our CAPEX was 4 percent of revenues or 3.9 million and now some selected balance sheet numbers.

Cash and equivalents were at 11.8 million. Accounts receivable at 62.4 million. Current assets 98.8 million. Total assets 622 million. Short-term debt was 14.1 million and long-term debt was 249.6 million with the total debt of 263.7 million. The net worth of the company was 294.6 million. We had depreciation of 3.1 million and amortization of 0.5 million.

That concludes the financial picture for the first quarter and now I will turn it over to Rich.

Thanks Frank.

The operating team produced strong results in the first quarter by leveraging our recent plan from . Because of their hard work, operating margins improved in spite of rising expenses in the areas of insurance and energy. The sales and marketing team continue to domestic role out of our Sterisafe compliance program. Building on the success last year, the team behind their marketing experience stays to STG customers who had not yet been introduced to the program.

We have established the following goals for 2002. We want to Sterisafe the optimal choice for all new customers. We want to focus on up selling opportunities in all the geographies where we have customers already on the program and by year end, we want to achieve a minimum 18 percent customer conversion. Remain very encouraged by the continued customer acceptance of the new service offering and at present we have approximately 28,000 on the compliance program nationwide.

Basically, it is over 11 percent of our target at SQG base. During the quarter we secured 54 new hospital contracts and in addition, we now have over a 130 hospital backup contracts in place and remain well positioned to take advantage of future onsite and offsite conversion opportunities. At the close of the quarter signed up over 4700 new small customer service agreements and in these agreements approximately 95 percent of the customers shows that Sterisafe compliance program.

Thanks for the strong performance of our sales team. We grew our customer base over 275,000 customers of which approximately 4700 or large accounts are remained as small.

I will turn this back to Mark.

Thanks Rich,

Clearly, we have another exceptional quarter with record at heights and revenues, gross margin, EBITDA and EPS all contributing to exceptional value creation for our shareholders. We really excited about the multitude of opportunities, which I will have to expand that value for the company. I would like to now provide insite on the quarter outlook for the remainder of 2002. Please keep in mind that these are forward-looking statements.

Third analyst EPS estimates for 2002 range from 1.89 dollars to a dollar and 92. We believe that analyst after the detailed review of their models will potentially raise their estimates to arrange of a dollar and 94 to a dollar and 97 which we are comfortable with. This assumes the average share kind of approximately 23 million shares average for the year.

I would like to provide some fine tunings to the outlook for 2002. Prior to this call, analyst revenue estimates for the year, averaged approximately 390 million with modest variations depending on assumptions of acquisitions and international revenues in the year. Based upon our strong performance and new acquisitions, we believe that analyst may adjust with 2002 revenue estimates upward to between 397 and 399 million. Current analyst estimates for net income average approximately 42.5 million putting upon adjustments for higher revenues obviously offset by related operating expenses and strategic investments and lower net interest expense.

Analyst may adjust their 2002, net income estimates upward to arrange our 45.4 to 45 million dollars. 2002, annual analyst EPITDA estimates may be increased from approximately 111 to 112 million to about a 112.5 to a 113.5 million. G&A expense and depreciation and amortization of approximately 15.3 million. I would like to thank our customers first and foremost for their loyal support. All of our employees listed an incredible job this quarter, great effort throughout the quarter and continued to the end of the year and also our shareholders, coactively you provided us with the resources to be at the first rate industry leading company. We thank you that is the end of our prepared comments.

And operator will now open it up to question and answer.

We don't keep a stat, obviously at the district level, by now which accounts to have before and still have a go away. There has been multiple vocations, were we have got hospitals back again and there is of that in all parts of the country and so it is not even geographic specific any one area competitor and usually the reasons are some smaller player goes in promises whatever you want, those are at your service, and do whatever intake or giving it a great price, or give any great terms and all of the sudden, there is some issue, either the smaller file realizes and cash flow negative on this and goes back and says " I am sorry, I can't service you, what I committed, I have to either raise prices dramatically or cut back on something, the customers as well, time out and I want to go back to re-bid and put this out again" or they have some service issues where they realize or not make money and they still perform besides belief after service some guidance.

The customer will do a regulatory audit and find out that the service provider may be in the tiptop and that they have more risk than they anticipated. Sometimes that is turnaround of the reusable containers and we don't have the ability to invest those capitals, a wide variety of factors coming to play. As hard as it is for sales and service personal who want to keep every single customer they are learning with the toolbox and disappoint to say. Eventually, we will get the exports back, that if we provide good service at a fair price and take care of the customers that are good customers will have a very solid long-term relationship and we will see them again.

Thank you,

Ladies and gentlemen, at this time if you have a question you will need to press one on you touch tone phone. Your question will be taken in the order that they receive. If your questions are already been answered you may remove yourself from the keyboard pressing the bounce key. In addition, if you are using the speakerphone, please pick up the handset before pressing the buttons. One moment for our first question.

Mr Wise form Bear Sterns; please go ahead with your question.

Good afternoon everybody.

Congratulations for really terrific quarter. Could you help us what percentage of sales in the quarter were backup contracts and will that trend likely to go over the next few quarters?

Actually, in 1Q, trying to get an exact estimate but backup activities in terms of new accounts captured was about two hospitals and in terms of revenue impact from people who are taking down for rework or testing. We probably picked up less than a 100,000 dollars worth of revenues in the quarter from that.

Is that going be significant?

We think, we will have periodic spikes as peoples do go down for repair but I don't think it is a major item yet.

Of the sales in this quarter, how much was in the acquisition?

Acquisition was about 5 million.

To make sure, in terms of the new revenue dollar range, that you give us, is that up 11 percent which is little low to the average seen in the last quarters. Is that in your mind to exclude that positions or include positions?

With the guidance that we gave at the end of the call, we would be just taking what the people have before and then incorporating the few acquisitions that we did in the first quarter but no additional acquisitions beyond that.

Debt-to-capital, after getting it down. I think you are supporting 7 percent. Where are you targeting. Where do you think you can go over the next 12 months and how do you want to discuss it. Would you prefer to have more leverage, could you update on that?

I think, if you look forward as well as kind of overall company of Jack Davis (indiscernible) we said before this week, you will again have a debt-to-cap between 35 to 45 percent discount on the percentage and that will end of up as a rate of about 2 to 2.5 debt-to-EBITDA as a ratio and debt from that point of view gets us hopefully some good rating improvement in our debt and future opportunity to flow into that.

Okay. Thank you very much.

Mr Quebec from UBS Warburg. Please go ahead with your question.

Hi, about CAPEX

Very nice quarter, an under statement. If you could focus on the large generated contracts 54, two questions, I am assuming those contracts are meeting your requirements in terms of gross margin and contribution margin if you could highlight that actual number and two, where are they coming from. Is there geography on the certain bid side?

The gross margins we were taking on, what that means our standards all of those would have been of 20 percent or more gross margins. In terms of the (indiscernible) they are very geographically diverse. There are some current hospitals, maybe that were outsourcing to another vendor that are happy with that vendor service beside the switch and the like. So, there really is a tight pattern of what we see that as fairly broader across the country.

The gross margin is it met based on ... or are you just pushing price through or you move around with the service component?

Well, through all the new contracts we look at the expected gross margin in agreement and the price and service offering and adjusted accordingly, and if the hospital, for example, only has a budget of 30,000 dollars, then we will describe to them what level of service we can provide to them to their budgetary level or if they set the service requirements, and we will tell them what the pricing will be for that level. So, we really try to help make it workable for their budgetary and making sure that meets our margin targets.

On housing keeping, should there be a diluted share count .. prudent?

For the quarter ending it was 22.385.

Thanks very much.

Mr Jenko, from Merrill Lynch. Please go ahead with the question.

Thank you.

Two questions. One for Mark. How much more should be aware of the (indiscernible) liabilities for your customers becoming since the Banc of (indiscernible) your competitors and a question to Rich, what percentage of the cost for sales is unachieved and what do see most recently in the market for those cost?

On the awareness side, (indiscernible) great liability that continues to emerge and wish we were further along the development of that understanding but that is really starting to hit home. It really hits home when you have customers who were dealing with a vendor who did not know what the current situation had been was. All of a sudden find out that they are not getting serviced.

They are also wondering the way that was picked up. Has it properly been treated or not. What is the documentation on the manifest and realizing that there is no company to support those potential liabilities? So it continues to evolve and it is clearly something that we think over the long-term will benefit us an organization because of the breadth and depth of the infrastructure. But, I would really call probably in the third innings of that development of understanding across the healthcare space.

Rich is going to discuss on cost revenue?

Yeah Mill.

Energy and fuel kind of combined run around 4 percent of revenue and what we saw in 1Q was just a modest increase in that and what we kind of put forward when we give the guidance at the end of the prepared March was in the assumption that fuel and energy would modestly increase through out the year and that has built into our assumption when we give the guidance.

This is (indiscernible)

Could you give us information on before acquisitions that you made?

Before acquisitions, we are located in New Jersey, Pennsylvania, Texas as the predominant ones, and in West Virginia and total revenues were little over 5.5 million, annualized and overall the margins at the starting point gross margins for those business were roughly around 30 percent. The EBITDA at the start were roughly around 20 percent marker and we hopefully are not hopefully we will make improvements upon that.

Could any of those companies have disposal capacity?

They have disposal there in total. None of those have treatment capacity now.

What do you think in multiples that you can train for this acquisition?

Very similar past, we are holding between the 3.5 and 5 from that range. That is the multiple of EBITDA.

Can you talk a little bit about your efforts to convert your existing SQG client base?

Yes, we continued to do our mailing programs. We take our database as to we have the history of revenues on an account in the service pattern and do direct mailings to that with the customize framework also through our call center and telemarketing and sales efforts. So, we are continuing to the run the same place towards and upwards and on track to hit our goals as Rich mentioned in his comments up over an 11 percent. Our target based and we are pleased with what we are saying and also we have a feeling to have an early signs of some favorable impact on our DSO, as some of those customer elected to prepeg.

Thank you.

Mr Gibson from Banc of America Securities. Please go ahead with your question.

I just wonder book-keeping and make sure, I heard that number right. Did I hear 54 new hospitals in the first quarter?

Yes.

It seem like just given the other number, that was lot of those who coming out of the backup program.

The hospitals include couple of bad debt conversions but also adjust additional share gains and that share gains and so we are going to continue work on that sector. But that is missing and again our goal was not revenues for revenues sake but strictly focussed on improving our margin.

In Toms Hospitals you have already had where contracts expired. Had there been many dropping out as you try to increase the margins to except, or wait for the most of it going along?

Well, we get a few dropout in the process in the driven by a fairly competitive market out there. There are also small companies and sometimes people will take on work as levels, as we just say, we cannot make money, make appropriate levels, we probably watch it in the first quarter may be 10 or 12 accounts which is not typical from a normal drill. We would we like to have all of them, sure we would. But reality is we are always going to have a couple of that and just want to try to have it all and our goal is do not run a charity program and do it at a loss.

That make sense. In terms of the guidance I guess, this acquisitions today, I would think that the pressures on the small guides only intensifies we moved a long gear. Could you speak a little bit what the environment, is it like for the new acquisitions?

Sure, I can speak to that. The pipeline is still very robust. We typically work on a couple of those in the thirty deals in any one time and not really changed out there lot of our competitors don't have their own treatment infrastructure. Their operating very low or almost EBITDA levels which eventually brings them into the candidate pool. We feel very optimistic that will continue to acquisitions in that very very narrow range that Frank talked about 3.5 to 5 times EBITDA. Again we are opportunistic. We do these things strategically and we do them on our own timetable.

Mr Monroe, please state your company name followed by your question.

Thomas Weisel Partners.

Good afternoon. Could you tell me what the EPS benefit is from the reversal of the interest rates Mark.

The amount and the quarter itself and the reversal of the swab was about a penny and less than a penny. 0.6 cents. That was small because it happened at the quarter.

Okay.

On Steri-Safe, do you guys break out how much revenue you got from Steri-Safe this quarter?

We don't have yet broken it out by sector because of the terms of reporting systems were small quantity about 11 percent of our customer base.

Could you tell me how much incremental revenue per, I guess the small customer base on average, when a new customer take SteriSafe, how much is that incremental revenue relative if they didn't take SteriSafe?

In the program, people take the most basic level what we call as standard level. It is generally about a 10 to 15 dollar month incremental vs. just as basis med rate services of very affordable for them and for us is removed to time at the meaningful step up. I think it has set another call. If you look at where we were last year in earnings per share on as reported basis is at dollar 15, 13 dollar per month, on average per account of additional margin per but a dollar 15 in earnings. This is one element of our program that keep looking hard overview over time continue to grow that earnings strength.

Are most customers at the lower level or people taking up that higher? When they first started our goal is to get people started on the program. So through the mailing programs and telemarketing programs and the like?

Most of those customers are signing up at that basic level. What we are seeing is evidence of retraction of the program and what we really see is ability to drive margin expansion, even more dramatically in the future, is the fact that that is people around the program as they upgrade to different levels. This is the lastly preferred. There can be more meaningful. The same accounts that might start the standard program on 10 or 12 dollar a month increment.

If they select preferred level might be a 75 to 100 dollar per month incremental revenue strength. And that the margins of the incremental revenue stream being significantly higher than the base. It has the long-term pretended show to expand gross margins on the blended basis by almost 10 full percentage points in that sector.

Great! Thank you.

Ms Taylor from CSFB please go ahead with your question

Hi, not to keep asking about logic count but this 54 full contracts or any of those backup contracts?

Those are full contracts for service and two of those were actually conversions from back up to full service.

So, 52 are entirely new of large contracts?

Yes.

Okay. How many additional back up contracts were signed this quarter?

I think it is probably 5.

Okay. Do you have a sense of margins over all for a small vs. large accounts?

I think on the margin just looking on the small and high 50s, to the 60 marks and that is all on the small and the large customers are between 15.5 and 16.5 percent blended.

And you said it was 20 plus from your large accounts?

That is correct.

And then a house keeping question. Revolver availability sounds.....

It is 80 million. It is on news right now.

Any letters of credit?

Letters of credit are really very small in fact we did reduce as we said in the text year-to-date thirty million, we drew little bit on the revolver, in fact right now we have 7 million outstanding on revolver because of that.

I am sorry; the 7 million was at the end of the quarter?

That is right now. End of the quarter it was zero.

Great! Thanks so much.

from Salmno Smith Barney. Please go ahead with the question.

Hi congratulations on the quarter.

Couple of quick question. First is the housekeeping item. There seem to be jump up in the accrued liabilities in your cash flow stream and if you could give some color on that and then it seems as though the EPS deadline of September 15 has been Has there been an heightened activity which your business development people of the 54 large accounts. Where they an existing markets or do you see yourself a kind of going into new markets or would you first close the critical mass to go into the new market?

I will take the first segment. The newer comp penetration is nearly targeted in service that was currently reaching this infrastructure. If we were looking at entering news echoes and news states, we will be looking forward not only as you said the critical mass to get started whether the capture of number of hospitals and the small generators were it be trinational accounts program or just direct marketing activities. As we have done in some more calls through acquisition activities. So the decision process of duly entered contiguous geographies is really based upon having some critical mass and also comfortable level that we can in very shorter, reach a leading position because it is a business, that we were in economically size, scale and density and we don't want to spend a lot of time, kind of scratching at bit by bit in the new to carry out.

Frank will talk about the casual.

The accrued liabilities are really a combination of mostly three things. It is accrued interest, tax side and then also the accrued insurance. We are now on the insurance side, self-insured more. We have hired deductibles and the accruals are little bit more with respect to overall benefit accruals, we changed over TPAs and our medical program at the end of the year, which normally increases the amount that still has to get paid. So that is the normal increase from the accrual point of view there.

A couple of more housekeeping, can you split out the revenue from Mexico and ?

If you look at 3CI, 3 CI is a 4 million and Mexico was at 2.6 million.

Great. Thanks very much.

Mr Brady please go ahead stating your company name. Any question?

70,000 small quantity generation, in which 28,000 SteriSafe, can you give us the average revenue of the small quantity generators without SteriSafe and the revenue with SteriSafe?

There is some rough order magnitude. The small account without SteriSafe typically range 700 and 750 dollars per annum. Obviously there is broader distribution typical account and on the basic level of program as I mentioned a 10 to 15 dollar per month incremental charge to that. So, if you have for example, someone who has 700 dollars in the base program they might be 820 or 880 dollars under the standard level.

What is your currently largest SteriSafe customers and what level are they and how many to have?

In the preferred level there would be incremental after that same comparable that would be an incremental 75 to 100 dollars per month. So you would have, for example, incremental 700 might go to 1900 dollars at the top end less than 1 percent right now in that program. So we are seeing as people learn more about the program. It is still incredibly affordable level for them to have that is coming once per year unto the onsite training and compliance program.

The increase guidance was up to 93 dollar, 94 dollar and 97. So the first quarter was probably 6 or 7 cents from the consensus, Is there anything that we should be aware of that might inhibit to continue success or is this just a kind of thing.

Well I think that is correct. First quarter numbers was 4 cents vs. consensus and the guidance for the rest of the year. We are trying to look at and anticipate as rich mentioned, there may be some moderate rise in the field cost and maybe modest rise later in the year on LIBOR rates. We are trying to bake those kinds of things into our assumptions, clearly last period when we took our numbers up we raised estimates as well and lets make that numbers and keep beating the numbers and as the business matures, we will keep raising that guidance.

On the incremental 128 to 180 dollars an year, adopting the larger SteriSafe offering. How much incremental operating margin goes to the bottom line on that say 150 dollars a year?

Well 150, on that account level we probably captured additional gross margin of about 110 to 120 dollars of gross margin and then there is a modest amount of additional SG&A expenditure that we have in our current run rates supporting the program but I am not sure that is really (indiscernible) on product count basis. Just give the national roll out last year in training. So, we really view that is what is the incremental gross margin flow and manage our investments standards that just keeps according to growth.

One last question.

What percentage of your revenue were non-medical rates and how do you see list of all things?

In terms of noninfectious material, for example machinery or?

No, you talked about compliance program saying...

Okay, well all the breakout our revenue streams to small generators were concentrating the compliance program, represent 58 percent of our domestic sub revenues and mentioned about 11 percent of that is SteriSafe. So it is just a very small percent of the revenue is less than probably may be couple of million dollars in 1Q. They provided non-medical rate services sales. On 1Q we had an international about 2.7 million in the international equipment sales and that was ahead of our expectations priorly because, we have been on project that we had originally par withstand out throughout through 1Q that just happened sooner than anticipated. Again just a few percentage points of total revenue outside.

I have been by this that would possibly develop outside of your typical markets in compliance and all sorts of industry. Did you see any risk traction, or problematic think that convert your business?

I don't think, we don't deal it problematic. We really deal it as tremendous opportunity concentrated on the healthcare states for right now for our customers and we see adjusting and compliance in that self and the services offering products represents an opportunity to more than double the revenue per count potential. That is why we are really focused getting it launched across that universe first.

Outside of the healthcare space, there is literally millions of potential customers, it is probably three times the order of magnitude of potential customer accounts where we are trying to disprioritize our sales marketing resource right now, on what we already are servicing today.

Thank you.

Mr Ford from Lehman Brothers please go ahead with the question.

Couple of questions for you.

The acquisition multiples that you highlighted are correct?

That's correct.

And what would the post look like?

Normally, we have about one multiple of EBITDA as a benefit from those?

Frankly speaking you will realize that.

Normally about 3 to 6 months.

And is that just a question or sort of integrating roots things like that?

It is integrating roots, it is changing the waste flow and the utilization of plans and I have really done scaling it.

With respect to the new customer benefit, could you track any of it to the situation?

In terms of Medway, we have been pricking up accounts last year as well as this year. Ball park probably in the quarter at 200 dollars of revenue in the 1Q and we continued with the calls during the telemarketing programs and obviously our focus there is taking accounts that made our margins standards and we have turned away a number of customers who have called for service but when we looked at the service levels and pricing, it just didn't make any sense to pursue to some of those smaller amount of top layers want to take out their work they can fill their infrastructure of that.

Any comment on the utilization rate on the plans this quarter.

Right now we are running at about 76 percent.

Is that consistent with Q4?

Yes. Pretty much.

Okay. You mentioned LIBOR assumptions and fuel assumptions due and could you guys expand on those two or what kind of things are you thinking about in terms of what you patent your assumed guidance?

I think if you look at LIBOR going out, the estimates, that people are kind of printing right now, probably that by year end it is going to be between 2.25 to 2.5 percent. Fuel from now, just a smudge up probably about 20 percent.

Okay up 20 percent from the end of the year?

No from the end of the quarter.

Is the fuel, diesel or is that..?

It is predominantly diesel but you also have obviously on the utilities to gas that we use. It is kind of blended, numbered and was in blended utilities and trucking fuel.

Okay, all right great. Mark you mentioned how you know when accounts push you on the numbers, you are happy to walk away. When you have accounts leave do you track them? I am curious to know what the kind of return of activity you get.

Great! Thank you.

Mr Miller there are no further questions at this time. Please continue with any closing comments.

Well, I thank everybody for your time and patience. It has been a great start to the year. We are very excited about the 2002. The integration of BFI that we did in 2000 has again proven to be a tremendous combination for developing our infrastructure for expanding our business reach and giving us the platform and again thanks to our customers, to our employees and shareholders who have been a great support and everybody is very very pleased with the outlook going forward.

Thanks so much and look forward to talk to you in the next call.

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