Strata Skin Sciences Inc (SSKN) 2021 Q1 法說會逐字稿

Greetings, and welcome to STRATA Skin Sciences' First Quarter 2021 Earnings Conference Call. (Operator Instructions) As a reminder, this conference is being recorded.

It is now my pleasure to introduce your host, Leigh Salvo, Investor Relations for STRATA Skin Sciences. Thank you. You may begin.

Thank you, and good afternoon, everyone. Joining me today are Bob Moccia, Chief Executive Officer; and Matt Hill, Chief Financial Officer. Earlier today, STRATA released financial results for the quarter ended March 31, 2021. A copy of the press release is available on the company's website.

Before we begin, I'd like to remind you that management will make statements during this call that include forward-looking statements within the meaning of federal securities laws, which are made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. Any statements contained in this call that do not relate to matters of historical facts or relate to expectations or predictions of future events, results or performance are forward-looking statements.

All forward-looking statements, including, without limitation, those relating to our operating trends and future financial performance, the impact of COVID-19 on our business and prospects for recovery, including the distribution and effectiveness of the COVID-19 vaccine, expense management, expectations for hiring, growth in our organization, market opportunity, guidance for revenue, gross margin and operating expenses, commercial expansion and product pipeline development, expected future product launches and milestones and expected results and performance of our partnerships and commercial products, including patient outcomes, are based upon our current estimates and various assumptions.

These statements involve material risks and uncertainties that could cause actual results or events to materially differ from those anticipated or implied by these forward-looking statements. Accordingly, you should not place undue reliance on these statements. For a list and description of the risks and uncertainties associated with our business, please refer to the Risk Factors section of our public filings with the SEC, including our annual report on Form 10-K for the year ended December 31, 2020. This conference call contains time-sensitive information and is accurate only as of the live broadcast today, May 12, 2021.

STRATA Skin Sciences disclaims any intention or obligation, except as required by law, to update or revise any financial projections or forward-looking statements, whether because of new information, future events or otherwise. Also, during this presentation, we refer to domestic gross billings, which is a non-GAAP financial measure. A reconciliation of this non-GAAP financial measure to the most directly comparable GAAP financial measure is available in the company's earnings release for the first fiscal quarter ended March 31, 2021, which is accessible on the SEC's website and posted on the Investor Relations page of STRATA's website at www.strataskinsciences.com.

And with that, I'll turn the call over to Bob.

Thanks, Leigh. Good afternoon, everyone, and thank you for joining us for our first quarter 2021 earnings call. We had a disappointing first quarter of 2021 in that we reported total revenue of $5.8 million, of which recurring revenue was $4.7 million, a 17.9% decrease over the first quarter in 2020. There were several contributing factors to this decline, the first of which was the continued impact of the pandemic, especially early in the quarter, as dermatology offices remain understaffed. In many regions, restrictions remained in place and patients were reluctant to seek treatment.

In addition, we experienced an unfavorable swing of $800,000 in deferred revenues in Q1 2021 as compared to the first quarter of 2020. Our international business was impacted due to a deliberate strategic transition from capital equipment sales to a revenue model that is a combination of capital equipment sales and recurring revenue. We exited the first quarter with an installed base of 871 recurring revenue XTRAC devices, including 837 in the U.S. and 34 international placements, 30 of which have been placed in South Korea and 4 in Japan. This is up from 860 units at the end of December, but lower than our initial expectations.

In addition, 6 China placements shipped at the end of Q1 failed to make the deadline in time to be counted in the first quarter numbers, but will be recognized in the second quarter. Despite a slow start to the first quarter, improved patient business in March that continued into the second quarter, combined with pent-up demand from new patients resulting in dermatology offices ramping up to more normal staffing levels is encouraging. RDX Charts, which indicate patients seeking reimbursement for XTRAC treatments, largely driven by our direct-to-consumer advertising, which we started in Q4 2020, are reaching pre-COVID levels. We perceive this as a good indicator that new and returning patients are once again seeking out treatment from their dermatologists.

Since our last update in March, I have spent considerable time in the field to meet with our customers, our territory managers and key opinion leaders. Additionally, we conducted our first advisory meeting with key customers to best assess our current market position, potential to grow our business and devise a path to improve stakeholder value. These meetings have been very enlightening and have left me even more excited about the opportunities ahead. XTRAC remains an invaluable asset in dermatologists treatment of psoriasis, atopic dermatitis and vitiligo. Patients take comfort in the fact that this therapy is drug free, steroid free, painless and reimbursed by insurance. Dermatologists prescribe it because the effective, efficient treatments provide their patients with quick visible improvement, relief from painful persistent itch and is a safe alternative with lower risk of side effects than biologic and topical treatments.

Driving commercial execution will be our highest priority. I have identified several areas upon which to focus. First, we plan to prudently increase our investment in direct-to-consumer advertising. Historically, DTC spend has been the lifeblood of the commercial organization, which was evident in 2016 through early 2018. When the spend was reduced, the company saw a subsequent reduction in patient flow and recurring revenue. Then in the back half of 2018, when DTC investment resumed, we saw subsequent double-digit growth in 2019. In 2020, DTC spend was once again reduced to conserve cash during the pandemic with similar results.

In the fourth quarter, we resumed funding to consumer advertising and the early results are encouraging. Second, reengaging with our high-volume accounts is a priority. These customers represent about 15% of our total accounts and almost 40% of our recurring revenues. They have adopted XTRAC and I believe hold the best opportunity for growth and improved utilization. We plan to increase our frequency of calls on these accounts and stepping up efforts to provide these practices with added support they need to grow.

Third, we will target previous customers that have not yet started producing revenues, whether or not due to COVID-related issues. In the first quarter, we had approximately 20% XTRAC non-revenue-generating partners. Typically, we found that these accounts were more severely impacted by the pandemic. Our sales force is focused on helping these accounts return to more consistent production levels by employing dedicated support services and DTC campaigns. Fourth, we will be pursuing opportunities to support our sales organization through marketing campaigns that can best drive awareness among dermatologists. This starts with additional market research to hone our marketing strategy going forward and present a consistent, compelling message to providers.

As a key marketing tool, we plan to reintroduce clinical data that supports all 3 indications and reinforces the messages of safety, efficacy and cost benefit to the patient and clinic. It is our goal to raise our profile and presence in the industry. We have already begun to ramp up investments in this area in order to execute as quickly as possible.

Internationally, we currently have direct distribution contracts in Korea, Japan and China that provide for a hybrid capital equipment and recurring revenue model. We will continue to execute this strategy to drive recurring revenue when and where we can. This model is new to our distributors and will likely take time to implement processes and procedures in order to successfully drive this model. As a result, it is possible that our equipment sales may be impacted in the short term as our distributors navigate this transition. I have met with our worldwide distributor, and we are developing a plan for growth in our current international markets with expansion potential for future markets.

On the development front, we have plans to target the vitiligo indication as we believe there is a significant and untapped market opportunity that our XTRAC laser can specifically address. We are developing a relaunch plan and are working with an outside adviser to strengthen our managed care coverage with more wins, similar to Cigna, which, this past October, issued a new medical coverage policy for excimer laser therapy for dermatologic conditions, including vitiligo.

Additionally, in March, we announced the publication of an independent study in the Journal of European Academy of Dermatology and Venereology. In brief, this study was conducted by a team of dermatologists in Japan and was approved by the ethics committee of Kansai Medical University Kori Hospital. The study results demonstrate that patients with refractory vitiligo achieved satisfactory re-pigmentation in 5 treatments, including those who were previously unresponsive to conventional treatments. This study attributed better patient outcomes to XTRAC's higher irradiation rate as compared to other available UBB phototherapies. We are also delighted to welcome Bill Humphries to our Board of Directors, who brings more than 30 years of leadership in the pharmaceutical industry and particularly in dermatology. We look forward to the many contributions he can make to our leadership team.

Turning to our outlook for 2021. I have now been with STRATA approximately 75 days. I've been working closely with the team on a plan through the balance of 2021 and beyond that will position us for a return to consistent double-digit growth that we experienced from 2018 to 2019. As I outlined, we plan to focus on initiatives to drive worldwide recurring revenue with an emphasis on sales and marketing and to migrate international capital equipment customers to a recurring model as we have done in South Korea, Japan and now China.

Additionally, we plan on prudently increasing our spending on direct-to-dermatologists marketing, thereby creating further awareness of the XTRAC product line and the value it adds to partner clinics and patients, in addition to all the services we provide to our partner clinics, including direct-to-consumer advertising, clinical support, and reimbursement support among others. We will expect to add more educational programs and customer-focused support, such as increased presence at dermatology meetings, speakers to the podium and customer feedback opportunities to better serve their practices. In addition to supporting top line growth, I am confident that these initiatives will help improve our margin profile and generate meaningful cash flow from operations.

In short, commercial execution and a back to basics approach will be key. We have a strong DTC machine and a great opportunity to make targeted investments in sales and marketing in order to drive growth. While based on our experience, we believe the impact of sales may lag the investment. With the initiatives I have just described, we believe we will be approaching pre-COVID levels of revenue by the end of the year. My goal is to improve top line growth and my experience in commercial organizations in dermatology have shown me that initiatives such as marketing directly to our potential partners, expanding our sales force in order to build stronger relationship with the providers, continuing to partner with the clinics through our support services and delivering a clear and consistent message on the benefits of XTRAC excimer laser lead to greater awareness for XTRAC.

In summary, STRATA Skin Sciences has long been at the forefront of dermatology. Our best-in-class XTRAC excimer laser has been shown in more than 150 peer-reviewed clinical studies to be the safest and most effective treatment for psoriasis, vitiligo and atopic dermatitis, diseases that impact 31 million people a year.

STRATA offers a safe, effective treatment for patients, a stable increase base -- revenue base for clinics and the least expensive treatment available for payers. With our reoccurring model, a growing installed base, further investment in sales and marketing and a desire to grow our product pipeline, we have some exciting opportunities ahead.

With that, I'll turn the call over to our CFO, Matt Hill. Matt?

Thank you, Bob. As mentioned, revenues for the first quarter of 2021 were $5.8 million, a 13.4% decrease as compared to revenues of $6.7 million for the first quarter of 2020, reflecting the continued impact of the pandemic, especially early in the quarter, particularly in the northeast, as dermatology offices remained understaffed, restrictions have remained in place and patients were reluctant to seek treatment as well as the unfavorable impact of $800,000 in deferred revenue as compared to the first quarter of 2020 and the timing of certain orders and placement as we transition our international business from capital sales to a combined equipment and recurring revenue model.

First quarter revenue also reflects a step down in revenue from the fourth quarter of 2020 as patient insurances reset in the beginning of each year. Recurring revenues were $4.7 million, a 17.9% decrease as compared to $5.7 million for the first quarter of 2020. In addition to the above noted impacts on the revenue, recurring revenue was also impacted by lower DTC spend in 2020 included in COVID-related cost reductions. Equipment revenues were $1.1 million, an increase of 10.4% as compared to $1 million for the first quarter of 2020.

As we discussed last quarter, included in our press release issued this afternoon, we provided information on a non-GAAP measurement described as gross domestic recurring billings, which represents the amount invoiced to partnered clinics when treatment codes are sold to the physician. It does not include any normal GAAP adjustments, which are deferred revenue from prior quarters recorded as revenue in the current quarter, the deferral of revenue from the current quarter recorded as revenue in future quarters, and adjustments for co-pay and other discount. We felt this is an important disclosure in light of COVID-19 pandemic to assist in the understanding of our business to more effectively view the trends that we're seeing with our business.

We also want to provide transparency with respect to deferred revenue. Since we defer a portion of our GAAP recurring revenue into future quarters, a decrease in deferred revenue can impact each subsequent quarter. Non-GAAP gross domestic recurring billings was $4.6 million as compared to $5 million in the first quarter of 2020. The impact of deferred revenue and the reconciliation from non-GAAP gross domestic recurring billings to record revenue was an unfavorable $800,000 in the first quarter of 2021 as compared to the first quarter of 2020.

Overall gross profit was $3.7 million or 63.7% of revenue as compared to $4.4 million or 65.4% of revenues for the first quarter of 2020. Gross profit for recurring revenues was $3.2 million or 67.9% of revenues as compared to $3.9 million or 68.4% of revenues in the first quarter of 2020. The primary reason for the decrease in overall gross profit was lower sales, the unfavorable impact of deferred revenue as compared to the first quarter of 2020, which were partially offset by lower depreciation expense.

Engineering and product development costs were $384,000 as compared to $292,000 for the first quarter of 2020 as a result of certain engineering projects.

Selling and marketing expenses were $2.9 million as compared to $3.0 million in the first quarter of 2020. Sales and marketing expenses were slightly lower, primarily due to lower trade show costs and travel spend, partially offset by compensation and consulting costs.

General and administrative expenses were $2.8 million as compared to $2.1 million in the first quarter of 2020. General and administrative expenses were higher due to the CEO transition in the first quarter of 2021, including accruals for severance, recruiting fees and stock compensation for the acceleration of vesting at certain option grants.

Net loss for the first quarter of 2021 was $2.4 million or a loss of $0.07 per basic and diluted common share as compared to the net loss for the first quarter of 2020 of $1 million or a loss of $0.03 per basic and diluted common share. At March 31, 2021, cash, cash equivalents and restricted cash was $17.5 million as compared to $18.1 million at December 31, 2020. After cutting discretionary spending in 2020 due to the pandemic, in the fourth quarter of 2020, we began our investment back into DTC advertising, and Q1 2021 reached pre-COVID levels. We believe the recent improvement we have seen in key performance indicators is reflective of the increase in advertising spend. We'll continue to make investments in sales and marketing where we believe it will generate a return and increase placements and utilization in our partner clinics.

And now I'd like to open the call for questions.

(Operator Instructions)

Our first question comes from the line of Joe Pantginis with H.C. Wainwright.

A couple of questions. Obviously, a lot of things are out of your control because of COVID and some of the things you talked about with regard to deferred revenue. So I'm going to ask something a little differently. Obviously, you've talked about the northeast being a little choppy and there are some territories that still remain choppy because of the pandemic. Have any territories outperformed your expectations?

That's good question, Joe. This is Bob. The west and the Midwest have seemed to be recovering a little bit quicker than the northeast. And the sell piece is also a little bit slow, but we are seeing improvement, especially on the west coast in the heart of the country at this point. I think with the northeast, it's a combination of a couple of things based on the input I got from dermatologists that I spoke to. Weather, there was a lot of bad weather, as you probably remember in the northeast in February.

And secondly, just elderly patients, in particular, not wanting to go out into derms' offices, 2 times a week for several weeks, based on the fact that COVID was pretty rampant back then and there was still restrictions in place. That's why we think the northeast is a little slower coming back, but we're encouraged by what's happening with our RDX Charts and seeing more improvement.

That's fair. And then when you guys talk about the pent-up demand because, obviously, there are patients that would certainly want to get back to the clinic to get an XTRAC treatment. So I guess, when you talk about your -- what you would like from a projection standpoint, as you said, to get to pre-COVID level by year-end, how do you see some of this pent-up demand or backlog being able to work through it? Like, how quickly do you think you could work through it?

Yes. I think it's really a function of the derm offices themselves. And again, we're encouraged that they're opening up and seeing more patients. Again, the feedback that I got from dermatologists that I spoke to is that staffing was an issue earlier in the year, but they are having a lot better success in getting staffing back up to a norm. So once that's in place, I would expect that the patients will start to flow in. That's why we really want to focus on increasing our direct-to-consumer advertising. We want to drive more patients into the derms' offices.

Our high-volume customers, of course, are critical. They dropped off just like everybody else, but clearly, if we can get them back to functioning at a high level, they can produce or treat a number of patients very quickly. And then we had about 20% of our accounts that just generated no revenue for us in the first quarter. So if we can get them up and running, that creates also capacity. So I think the capacity is there. It's a matter of getting the patients feeling comfortable going into the derms' offices and us helping drive them to them for treatment.

Our next question comes from the line of Jeffrey Cohen with Ladenburg Thalmann.

So firstly, could you give us a breakdown of U.S. and international, just on the top line?

Yes, absolutely. Domestic revenues for the 3 months ended March 31, 2021, were $4.7 million -- I'm sorry, were -- yes, $4.7 million and internationally was $1.1 million.

Okay. I got it. So that was the...

To get you to $5.8 million.

Yes, similar breakdown to recurring and equipment.

Absolutely.

Yes, $4.7 million in recurring and $1.1 million in equipment.

Okay. Got it. Can you reconcile some of your comments on 6 units for China, which arguably sounds like they will hit in the second quarter and then kind of correlate that with the deferred revenue number, which I'm assuming is mostly or all U.S. So what amount of that gets pulled through into the second quarter or it gets pulled off in the second quarter as well?

That's a great question. When we look at the deferred revenue, Jeff, it really comes around with what comes in from last quarter into this quarter. So the difference coming into Q1 of 2021 as compared to '20 was $0.5 million. So day 1, we started Q1 '21, $0.5 million behind last quarter's. And now leaving Q1 into Q2, we have an additional $300,000 coming out of Q1 into Q2 '21. So that sets us up better for Q2, especially as compared to Q2 last year, where we only had $1.5 million coming in. Now as it -- did that cover your question?

Yes. So it sounded like $300,000. Does that include or exclude the 6 units for China? And I'm assuming they are a combination of capital and recurring through your distribution model?

Yes, absolutely. So to be specific, we have 4 units to Japan, which was about $400,000 that shipped too late for Q1. And then we had 6 placements. And when we refer to placements, that's what we're talking about is the recurring revenue model that will show up in our installed base come next quarter. So it was a combination of Japan and China. China was placements and Japan was actual equipment sales.

Okay. So the $400,000 from Japan and the $300,000 in the deferred revenue could bump Q2 by those 2 amounts, potentially.

As compared to last year. And based on the timing of the orders, we expect to see a bump in equipment sales in Q2. But you know how equipment sales can be, which is why we're trying to move away from it, is they can be choppy.

Got it. Could you talk about the commercial organization now end of year how many FTEs? And where does that stand now? What would you expect for the balance of '21?

Sure. So we have 28 territories currently, Jeff. I would anticipate that we will add some additional people to the sales force, and I'll tell you why. We have, as you can imagine, very big territories, a lot of windshield time. And I'm a big fan of frequency. In other words, getting into the accounts on a regular basis every other week, if possible. So I'd like to cut down on those large territories. And what I plan on doing is a realignment exercise where we'll make sure that we have coverage in the best possible places on a geographic basis. And that will determine how many people that we may need to add.

So I don't see it being dramatic, but there could be some additional bodies in the sales force, which I think will improve our opportunities for growth. And then from a marketing standpoint, we may look to bring on a marketer who has some derm experience in direct marketing to dermatologists. You've heard me say before, I think the company has done an outstanding job with their direct-to-consumer advertising program. But one thing, I think, where we can improve is marketing directly to the dermatologists or the provider. And I think that's a place I'd like to shore us up a little bit.

Okay. And then any commentary on product developments, you made a couple of references to that in both your script as well as the documents you filed. So could you talk about product developments for the quarter? Is it new products, new devices, new recurring models, et cetera?

Yes. So a couple of things. So I think there's opportunities for indications. I think the vitiligo indication is undercapitalized by us at this point. And I think there's an opportunity there. I'd like to see us relaunch in vitiligo. We have good clinical data behind it. As you know, there is some new topical treatments coming for vitiligo here in the second half of the year for some big pharma organizations. Those treatments will get a lot of noise. They're very expensive. Remains to be seen how effective they are, but they have side effects.

So I think that we certainly remain a good alternative to any topical or oral treatment for vitiligo. And I want to make sure the derms are aware of that. There are other indications that the excimer laser is used for, that we can't talk about. It gets used off label, and we want to explore if those indications are things that we could add to our 510(k). So those are some of the development areas that we're looking at as well as improvements to the current XTRAC. We -- the company has done a good job in improving the technology, and I think there's some opportunities there as well as we move into the latter part of the year.

Got it. Then lastly for me. Matt, any commentary on margins? I know they were about 220 basis points ahead of what we estimated. But is that going to be affected by mix? Or is that a current level that you're feeling good about maintaining going forward?

Overall margins are -- it's great about coming to this company and seeing the recurring revenue model executed well pre-COVID and now looking to reengage and drive the recurring revenue utilization through our partner clinics. The fact that the margins accelerate once you get above the breakeven on the placements. So we get up into the low 90s percent margin. So it will greatly be affected by the growing recurring revenue, particularly -- specifically domestically.

Our next question comes from the line of Suraj Kalia with Oppenheimer.

Bob, Matt, can you hear me all right?

Absolutely.

Yes.

Perfect. So Bob, first and foremost, I got some numbers on the call. So 15% of the accounts do about 40% of the revenues, Bob. I was wondering if you could tell us, are these revenues from higher sessions per patient? Or are they from the higher overall patients? I guess what is the secret to your success based on what you have seen, and how translatable are these?

Yes. That's a good question, Suraj. It really is a factor of volume. Our highest producing accounts move more patients through their offices. And they're probably -- in my estimation, they're probably more successful in making sure the patients complete a complete course of therapy. So by that alone, they're going to give more treatment. So 120 is where we were in the first quarter. And just for comparison, in 2019, we were at 220 of top accounts.

So we've got some work ahead of us to get our numbers back up to where they were in 2019 with these high-volume customers, and they are an absolute priority for us. The sales force is getting -- has got marching orders to increase their frequency there and to do anything they can to drive patients in and improve their efficiencies. So they're very important to us, and we think we can turn that around with just some good back to basics, blocking and tackling.

Got it. Bob, DTC has been repeatedly cited as one of the drivers for growth with -- I'm not sure if it is a 1:1 correlation, but a pretty strong R-squared to a top line growth. Long term, Bob, how do you look at leveragability in this model? That is one part of the question. And the second part, Bob, to piggyback on the vitiligo comments you made, we all know the JAK inhibitors are coming shortly, right? And you implemented them on vitiligo. Would that be introducing a new product to go head-to-head with, I should say, head-to-head -- but there'll be some level of crowding in, right? Would this be the best spend of money at this time, in your view? Would love to get your expertise and thoughts behind that.

Sure. So I think the direct-to-consumer model that the company has run for the last several years, obviously, has been very, very successful. And if you just look at the history, and Matt has more insight on it than I do. But just from what I've been able to gather, I mean when the spend was increased by the company in direct-to-consumer advertising, the number of visits or appointments made for the treatment by XTRAC increase. So I mean, I certainly think that that's something that we want to continue to invest in. As I said, I think the company has done a great job. I think where we can improve is our marketing directly to dermatologists because ultimately, the dermatologist is the one who's making the decision.

And if we want to expand usage, which is one of the goals that we have in 2021 and beyond, then we need to make sure that XTRAC is top of mind when a psoriasis patient comes into that office, not just because we sent them in from direct-to-consumer advertising but the halo effect that we generate by sending patients in who ask for XTRAC, who come back to the dermatologists and praise the treatment and how much they liked it. And the interactions I've had in the last couple of months with derms, the feedback has been that it's effective treatment, that patients like it. As we mentioned, painless, drug free. It treats their itch very quickly. All these things are very positive and reinforcing for their usage of XTRAC. So from that perspective, I think the direct-to-consumer advertising is important, and we'll continue to do that.

With regards to vitiligo, my experience, Suraj, has been whenever a new drug comes into the market in an indication such as vitiligo that does not have a lot of choices for treatment, and right now, there really aren't many choices, any dermatologist will tell you that and laser is one of the few things that is actually approved for it, the noise level is going to go up dramatically. And what will happen is, as you know, patients who haven't sought treatment in a long time are going to come into the dermatologists to get treatment. And not everyone is going to be a candidate for JAK, for a number of reasons, the cost. They're going to have maybe some difficulty with reimbursement. The effectiveness is suspect in some ways with certain patients, and it's an immunosuppressant.

And right now, a lot of patients don't want to take immunosuppressants because of COVID. So I think that we are in a really good opportunity to be there as an alternative to these topicals or oral JAKs as a treatment that's proven, it's safe, it's effective, and it's cost-effective for the patient, and it's a revenue generator for the doctor. So I do think it's an opportunity for us that I do want to focus on and capitalize on. We know who the KOLs are in vitiligo. We'll get them to the podium talking about our treatment. And I think we can capitalize on that opportunity.

Got it. Finally, Bob, could you give us the status on MMD in the field? Has there been a shift in total number of sessions per patient with use of MMD? Any color there would be greatly appreciated.

Thank you. Not a real shift. We haven't seen, I think, partially because of COVID, maybe the MMD has not got the attention it might have got if we weren't in a COVID situation. So we have not seen a shift in the number of treatments to this point because of that. And it is potentially an opportunity for those patients who don't want to go through the full course. But certainly, there are a number of patients and providers for that matter who do like to treat the full course of XTRAC therapy. So hard to say if that's going to change going forward, but we'll keep an eye on that.

There are no further questions in the queue. I'd like to hand the call back to Bob Moccia for closing remarks.

Thank you, operator. I'd just like to thank everyone for joining us today, and I hope everyone stays safe and healthy going forward and look forward to speaking to you on the next call. Thank you.

Ladies and gentlemen, this does conclude today's teleconference. Thank you for your participation. You may disconnect your lines at this time, and have a wonderful day.