TFI International Inc (TFII) 2006 Q3 法說會逐字稿

Ladies and gentlemen, thank you for standing by. Welcome to the TransForce Income Fund third-quarter results conference call.

During the presentation, all participants will be in a listen-only mode. Afterwards, we will conduct a question-and-answer session. (OPERATOR INSTRUCTIONS). As a reminder, this conference is being recorded Tuesday, October 24, 2006.

It's my pleasure now to turn the conference call over to [John Lutes]. Please proceed, sir.

Thank you, operator, and good morning, everyone. Thank you for joining us today for a discussion of the 2006 third-quarter results for TransForce Income Fund. The results for the quarter and the nine months ended September 30, 2006 were issued via news release on CanadaNewswire this morning.

On today's call, Alain Bedard, Chairman, President and CEO of TransForce will discuss the highlights of the first quarter and Sal Vitale, the Chief Financial Officer, will review the financial results. Following their comments, we will open the line for questions.

Analysts and portfolio managers are welcome to ask questions over the phone and the operator will be providing instructions. The recording of this call will be available until October 31, 2006, and that recording can be accessed by using the dial-in and reservation numbers listed in the earnings release issued earlier today. Business media and unitholders are welcome to listen to this call and media can use management's (technical difficulty) any coverage. However, we would ask that they do not quote callers unless the individual as granted their consent. After management has finished with their remarks, the operator will poll for questions from analysts. If any media want to ask follow-up questions, please give me a call and my number is 416-929-5883. It's also on the earnings release. Unitholder questions should be directed to Sal Vitale after this call.

Now, before Alain begins, I need to read the (technical difficulty) following discussion will include a review of developments the affected TransForce's performance during the third quarter of 2006 and may include forward-looking statements and estimates. Such comments will be affected by and involve known and unknown risks and uncertainties, which may cause the actual results of the Fund to be maturity different from those expressed or implied.

Now, here is Alain Bedard, Chairman, President and CEO of TransForce Income Fund.

Well, thank you, John, and good morning, everyone.

I am pleased to say that, in the third quarter, we have continued the trajectory established in the first half of the year. In the quarter, we improved our year-over-year results in all key measures, revenue, cash flow, EBITDA, and cash available for distribution. We demonstrated that TransForce is maintaining steady and solid growth as we promised our unitholders.

In particular, I would point that our EBITDA, at over 67 million in the third quarter, was another record for TransForce. Our continuing growth is a result of both operational improvements and acquisitions that support our long-term strategy, which is to pursue diversification across different lines of business, different regions, and different client base. As you know, we are always looking for successful, well-managed companies that are leaders in their market.

The continuing economic expansion in the Alberta oil industry and in western Canada generally demonstrate the wisdom of our approach. We expect that our growing presence in the West will contribute significantly to our profitability, cash generation and long-term success.

Sal will take you through the financial details in a few moments. Before he does, however, I would like to take you through the key features of the quarter.

In the LTL (indiscernible) parcel of our business, we experienced continued organic growth. The new (indiscernible) is up and running and will deliver operational improvements that will help us maintain steady growth in line with our long-term strategic objectives.

In the Truckload segment, we experienced continued softness in eastern Canada due to a weak U.S. dollar. In western Canada, our operations maintained their strength in line with the general vitality of the western Canadian economy.

In the Specialized Truckload segment, the tanker and flatbed division are doing very well. Our container business was somewhat soft over the quarter but is showing sign of improvement in Q4.

Finally, in the Specialized Services, we continue to sharpen the focus of our business. We are always examining ways to deliver value and shortly after the end of the quarter, we completed the sale of the hazardous waste operation of services Matrec. This was a relatively small part of our business with about 20 million in annual revenue and did not fit what we see as our core operation going forward. With this transaction, we not only streamline and focus our operation but we also capture value, almost $32 million in cash and a gain of close to 23 million.

In addition, we strengthened our position in western Canada with two strategic acquisitions. The first was Byers Transportation System, based in Edmonton, Alberta. Byers is a less-than-truckload carrier that serves more than 1500 communities in Alberta, BC, northern Canada. It also has strong partnership into the U.S. We expect it will add approximately 70 million in annual revenue. Just as important, it extends our reach and operational density in the West.

We also added Howard Transportation Services of Stony Plain, Alberta. It is a specialized oilfield services company that moves a variety of heavy equipment, including drilling rigs, and has annual revenue of approximately 20 million. This acquisition reinforces our growing presence in the dynamic Canadian energy sector and increases our geographic diversification. We are confident that these transactions will have a positive impact on our distribution. In fact, the sale of Matrec assets already has. Following that disposition, we announced a special distribution in addition to our regular monthly distribution of $0.1275 per unit. The special distribution is 0.0155 TransForce units for each unit outstanding and its economic equivalent for our tracking shares unitholders. Both distribution in regular and special will be payable on November 15 of this year to unitholders of record on October 31.

On another front, not operational but financial, TransForce also just concluded a new long-term and more flexible financing agreement. The new agreement, led by National Bank, consists of a revolving facility for 250 million with a term of four years and a term facility of 160 million with a term of seven years. It also provides for additional 190 million in financing. The new facilities are secured by Accounts Receivable and rolling stock. It gives us more flexible conditions than we had before, and they will allow for additional borrowing capacity for general corporate purposes to repay outstanding indebtedness and to continue to pursue acquisitions.

I want to emphasize how important this development is for TransForce. It represents a completely new financial foundation for TransForce with better terms and more flexible conditions that are beneficial to our unitholders. On top of that, we are particularly pleased that this new financing agreement demonstrates real confidence in the Fund's operation and financial condition for the long-term. So good news from our financial results, our operation, our distribution and our financial structure.

Now, I will ask Sal to review our TransForce's financial results for the quarter. Sal?

Thank you, Alain, and good morning.

As Alain has already noted, TransForce recorded strong results for the third quarter and the first nine months ended September 30, 2006. We increased revenues 18.3% to 454.3 million, up from 384 million a year ago. This increase came mainly from acquisitions as well as the organic growth of our operating divisions.

EBITDA, which is equivalent to operating income on our financial statements, was 67.2 million, up 26.3% compared with 53.2 million last year. As Alain mentioned, this was a record for quarterly EBITDA for TransForce, and it has been driven to a great extent by acquisitions, as well as the improved performance of our operating divisions.

Cash flow from our operating activities also increased significantly by 28.4% to 57.4 million, compared with 44.7 million last year.

Distributable cash from ongoing operations came in at 60.4 million for the quarter, compared with 45.8 million last year.

Net CapEx in the quarter was 11.1 million, compared with 12 million a year earlier. This is excluding the 33.2 million in proceeds from our customs brokerage division sale, as well as the sale of our Calgary terminal of 9.3 million.

In the most recent quarter, our scheduled debt repayment was 3.7 million compared to 4.1 million last year. Net/net, this resulted in distributable cash of 45.7 million in the quarter, compared with 32.5 million last year, again excluding the asset sale proceeds mentioned earlier.

Regular distributions from ongoing operations to unitholders and dividends to tracking shareholders declared in the third quarter were 30.7 million compared with 22.8 million last year. As you will note, last year, TransForce paid a special distribution of 39.1 million in the same quarter last year. Taking these into account, the funds payout ratio from ongoing operations in this quarter was 68.9% compared to 76.9% last year.

Turning to year-to-date results, revenue came in at 1.35 billion, up from 1.09 billion last year. EBITDA came in at 180.5 million versus 140.4 million; that's an increase of 28.6%. Cash flow from operating activities came in at 152.3 million compared with 117.7 million last year. Our distributable cash from ongoing operations for the first nine months came in at 160.5 million compared to a 123.6 million last year. Net CapEx for the nine months came in at 31.6 million, compared with 22.8 million last year, again excluding the sale from the disposal of our Customers Brokerage division and the Calgary terminal. Scheduled debt repayment, 13.2 million compared with 11.1. On a net/net basis, total distributable cash earned came in at 115.6 million, compared to 92.4 million, again excluding the asset sales of last year. Distributions from ongoing operations unitholders and dividends to our tracking shareholders declared were 89.7 million compared with 65.1 million for the first nine months of '05. This resulted in a payout ratio from ongoing operations of 79.4% compared with 77.1% last year.

To sum up, financially, the third quarter showed continued growth in all key measures. It continued the trends of the first half of the year and positions us well for the fourth quarter, when we expect seasonal LTL volumes and oilfield services to pick up further.

Now, Alain will wrap things up.

Thank you, Sal.

It is evident, from our financial results, that we are well on the road to yet another successful year of delivering value for our unitholders. Revenues, EBITDA and cash flow are all strong and show continued growth. We continue to diversify our operation according to our strategic objectives. Our financial position is strong and with our new financial agreement, we have long-term flexible financing in place to support our growth on more favorable terms.

We are very pleased with our results and accomplishment to date. Let me summarize them, strong performance from our operation overall; continued growth in our bottom-line and cash generation for unitholders; continued acquisition and focus of operation in a new financing structure. Based on this performance, we look forward to continued growth in the remaining quarter of the year. Several of our operation segments hold the potential for solid organic growth, and we remain committed to the acquisition strategy that has proven so successful for TransForce.

As I've noted many times in the past, our people are our true strength. They are the ones who see the opportunity to serve our customers better, increase our cash generation, and develop new paths for growth. With the resources and innovation of the TransForce team, we very much look forward to delivering increased value to our unitholders during the rest of year and into the future.

Thank you for your attention. Now, I will turn the call over to the operator so that we can take your questions. Operator?

Thank you. (OPERATOR INSTRUCTIONS). Walter Spracklin, RBC Capital Markets.

Good morning. On your West Coast exposure, can you remind us what you estimate to be your total as a percentage of revenue that you have in terms of your exposure to sort of Alberta/BC?

On energy sector or overall?

Let's do the energy sector.

The energy sector represents about 7% of our revenue today.

11%. We are seeing a lot of reduction in drilling activity over in Alberta right now. Is that showing up in your results at all?

No, not yet. As a matter of fact, I'm having a meeting with our energy guys this afternoon. I'm in Edmonton right now, so I will know more. But I mean we are going according to our plan, okay, for the month of October so far. So to answer your question, Walter, no, we haven't seen any movement in our customer base so far.

Okay. Just on your new debt facility, I just notice that you are right about 400 million in debt right now.

Right.

That's about 1.5 times, which is the highest you've been historically.

Yes.

You've done a good job of keeping that in range, but I know that if we go to 700 million under a new debt facility, that would bring you up to 2.6. Are you changing your target ranges here and where you want to keep your debt as a multiple of EBITDA?

No. What we've always said, Walter, is that what we feel, okay, is the maximum that we could play with is 2 times EBITDA. So our credit facility totals today about 600 million, if we play all the accordion in there, okay? But again, if we use the surplus of 190 million, okay, for acquisition, I mean, definitely our EBITDA will grow at the same time. But we won't play more than 2 times EBITDA. No, we won't go to over 2 times EBITDA on the debt.

Okay, that's good to hear. Then just lastly, sort of administrative question, maybe for Sal. After you do your special distribution, do you have on-hand what the units outstanding will be after the special for both the tracking shares and the units outstanding?

Well, as at the end of September, we had 84.9 million roughly outstanding, and we will have issued an additional 1.1. (multiple speakers)

1.1 (multiple speakers) on the special. Do you have that number for the tracking units as well, what they will?

Tracking outstanding as at the end of September was 13.7 million. That has not changed since, really that has not really changed since the last quarter.

So that won't get adjusted with the, that will get adjusted with the special as well, right?

No. The tracking shares were paid in cash. The special distribution to tracking shareholders was paid in cash. The additional units were issued to unitholders only.

Got it. Thanks very much, guys.

Unitholders only.

Nav Malik, Scotia Capital.

Good morning. I just wanted to follow up on one of Walter's questions. So the energy represents 7% of revenue. Are you referring to in the quarter or is that sort of pro forma for a full year?

Well, this is before the acquisition of Howard. Howard is adding about 20 million, okay, so 20 million; that's point one. I mean 20 million on a $2 billion company is small, so prior to the acquisition was 7% of our annual revenue.

Okay, and then.

Which was about 150; total was 150 million, okay? So if you add 20 of Howard, we are now up to 170 million.

Okay. In terms of how large you want that exposure to get, you wouldn't want it to go over, I think you've indicated in the past, what, 15%? You don't want that to go over, the energy part of your revenue?

Yes. What we've always said is that us, we are a diversified business model. So, no sector within TransForce we want to be more than 15%. On the energy play, because it's a high commodity, we said it's going to be between 10 and 15.

What sort of seasonality, like, I know, in Q2, you mentioned that the (indiscernible) of energy related business only were operating at about 10% of their full-year revenue or only contributed about 10% of that. Is that similar to Q3 as well?

Yes, Q3 is not way better than 2. The big quarters is always one, followed by four.

Okay. Just moving to this financing, the new financing arrangement, the flexible conditions that you mentioned there, has that been related to your covenants or what are those more flexible conditions?

Well, first of all, it's a transition deal, Nav. See, the way we want to go is a non-secured deal, first of all, okay? But we were stuck with the condition that you cannot do a non-secured deal if you have more than 10% of your assets, okay, that is secured, which was the case at TransForce. We had about 190 million that was secured prior to doing that deal, so through that transaction, okay, we were able to get unsecured assets or secured assets becoming unsecured with two banks, okay? So that brings our secured assets, outside of our deal, to very close to 10%. This deal could be reimbursed at any time. So, that's why I'm saying it's like a transition, okay, and we've got tons of flexibility. The interest rates are way better than what we were paying in the past, so it's a very nice, and also, we got a four-year deal and a seven-year deal, whereas in the past we were not in that situation.

Okay. Could you sort of quantify that interest rate benefit, like sort of what (multiple speakers)?

Yes. What we're looking at, the debt level that we have today, we are talking about $3 million a year in interest savings.

In interest savings, okay. Okay, that's over the previous rates that you were being charged?

Right, absolutely. So 3 million on $400 million of debt that we actually owe, let's say today, I mean, it's a big gain for us.

Okay, great. Just in terms of the organic growth, could you break it down maybe between rate and volume, or is that, I guess that sort of depends geographically.

Yes, it depends. You know, it's always the same thing. Out West, our volume is up. In the last quarter, our volume was up by 5 or 6%. We don't have that in the East. In the East, our volume is growing by 2 to 3%, okay. So it's very different from East to West right now, like it has been for the last 12 months, I would say.

Okay, great. Thanks very much.

Nadi Tadros, Desjardins Securities.

Good morning. Just to follow up on that last question about the volume growths on the, you were saying 5 or 6%, out West, 2 to 3 maybe in the East. Could you go down at a further level in terms of by division, TL, LTL, how those volume growth levels are playing out?

Yes. We were talking about the LTL, Nadi, because in that (multiple speakers) you understand? This is LTL, and parcel, parcel is, I would say, about 3 or 4% with our [camper] business. Now, in our truckload business, like it has been for the last, I would say, 18 months, our business has been soft, so we have no growth whatsoever in that business. Where we are having some growth, okay, in the East is in our specialized business. For instance, our tank business is growing by about 6 to 7% right now. Our container business was down versus last year because one of our customers, our main customer CP Ships was bought by Hauppauge. Hauppauge changed the way they service the customer, and they created a disruption in the market and now the market is coming back, so just to give you a little bit more insight about what's happening in our volume side of the business.

Could you give us an idea of how the pricing is playing out? Before that, in terms of the TL, are you saying flat volumes are actually moving into negative territory?

We've moved into negative territory for the last 18 months, okay? It has always been our approach to reduce the offer in order to not reduce the price. At the same time, what we're doing is we are buying to replenish our pipeline of small truckers at 10, 15, 20 trucks. Over the last 18 months, we did about four or five (indiscernible) of these transactions, okay?

So in the truckload world, in the East, you see decreasing activity, no question about that. But in terms of pricing, if you look at our margin, you see improved margin quarter-over-quarter, right? This comes from better operations. As a matter of fact, even with decreasing volume, our month of September in our Truckload division, okay, was more profitable than the year before because we are working more on our costs, we have better productivity, etc., etc.

So even with a slowing down of the demand, our approach has been (indiscernible) in Quebec because we are the leader in Quebec We are a big player in Ontario, but we're not the leader. In Ontario, there is no leader, as a matter of fact. But in Quebec, what we're trying to do is to match the offer with the demand. The demand is getting smaller, so we have to adjust, so we are offering less. Now, that means that our pipeline is getting less filled, okay? It creates a problem for us. So what we do, we turn around and we buy a small guy, 15 trucks, 20 trucks, 10 trucks, okay, and he disappears.

All right. On a separate question, Kroger had mentioned that they were temporarily shutting down some sawmill facilities in Quebec. Has that had any impact on you?

No.

None of that is showing up, or will it in the fourth quarter?

No. We are not a big holder of lumber products. Our flatbed is mostly associated with the aluminum business, steel business to a certain degree, okay. We do a bit of lumber but not much.

Okay. Then (multiple speakers).

There was never any money, you see, Nadi. There was never any money in hauling lumber, so we're not there.

Okay. Then finally, just on the FX, could you quantify what the FX foreign exchange impact has been in the quarter? (multiple speakers) the margins?

(multiple speakers). Maybe Sal could answer the question. What I could tell you is that every cent costs me 1.25 million about, I mean, so.

The average in the quarter was $1.16 this year versus $1.24 last year, so that's an $0.08 difference.

Just work out those sensitivities there? Okay, thanks a lot.

Wui-Seng Kon, Wellington West Capital Markets.

Just on the fuel prices, given the sharp decline in September, I'm just wondering what sort of impact that had, because there's obviously a lag and obviously you would be a beneficiary this time around as opposed to in the last year or so. Was it significant?

No, not really, Wui-Seng, because, you know, like we've always said, I mean, we are losing when it's going up on the lag. We're gaining a little bit when it comes down, but it's so, so small because the customer drags you when they have to raise the price. But the day that he understands that the price is dropping, he is on your back to lower your price, right, lower your surcharge. So, there is a small gain but not very significant.

Okay. My second question is on, again on the parcel business. When I look at Q2 versus Q3 on the LTL on parcel, in terms of the segmental disclosure, it seems to be a small decline over Q2. Is there any reason for that?

No. It's just a matter of the number of holidays that we have (indiscernible), the fact that I mean Canpar is very busy August and September, so Canpar is helping us. But on the other side, the LTL business is very slow in the month of July because everybody is gone, so versus the Q2 where you don't have so big of a gap in one month. So the killer for us in the LTL is always January, which is very slow for us, and July.

Okay. On truckload softness, again, I know you mentioned it before. What sort of volume or fleet reductions have been taking place to (multiple speakers)?

(multiple speakers) if we look at our fleet, this year versus last year, we've dropped our fleet by at least 250 trucks, okay, which means about $50 million of business. But at the same time, we've acquired a small business here and there for maybe 25 to 30 million, so it would have dropped a bit. But this is all done in order to protect pricing. And you know, if we don't match the offer with the demand, I mean this is basic Economy 101, and it seems like not too many in the industry follow this rule and we are trying to educate more and more. That's the name of the game. Just to say to the other trucker, well, don't hold onto the price, it doesn't work because the guy has got too much pressure; he's got too much assets in operation, right? So what we are saying to the industry, what we're trying to say is this, I mean, reduce the size of your fleet, okay, so then you are in much better shape to hold onto the pricing.

Right, right. (indiscernible) on the acquisition outlook with that spare capacity, is that targeted towards mainly the energy, or is it opportunistic?

No, no. What I would say, in a tough time like it is right now in the East, there's always a nice possibility of doing some good acquisition at a reasonable price, so that's why we are on the lookout. Our philosophy has always been let's put the structure in place, which we did in Q3, okay, so that we are in a position to do more of these acquisitions, because we think there's going to be some good opportunities in the next 12 months or 18 months because of what we're going on in the East right now. That being said, because we won't go to equity with a $17 or a $16 or a $18 stock, I mean, this is why we had to put in place what we did in Q3, a new structure so that it allows us to be in the position to do these acquisitions.

Now, at the same time, we have always said that whatever assets we've got or business line that we've got that don't fit because we are number five, because we are number six, like this Matrec division, we were a small player in Quebec and we were fighting big guys like (indiscernible), which is an international company, so we had no future in that business. So we sold it and made a good profit for our unitholders. We may have other line of business.

So that's the two things that we're going to do. We are on the lookout for good opportunities that fit our business, but at the same time, we've reorganized our financing and we are looking at other assets within TransForce that are not core. We may have a few. So that's the way we're going to do it in 2007.

So I mean, you could have a line of, say, maybe close to 250 or maybe 300, depending on how much you sell?

Yes.

Plus the credit lines available, in that sort of range?

Yes.

Okay, good. That's it for me. Thank you.

Cameron Renkas, BMO Nesbitt Burns.

I've got a couple of questions leftover still. Your SG&A seems to really be trending lower the last few quarters, despite the acquisitions. Is there something in those numbers? Are you reducing people or bodies at some divisions?

Well, as usual, this is an ongoing process, Cameron. I mean, every day, our management is there to question themselves, okay, how can we do it better? Now, in terms of our LTL and parcel, there's no question that this is going to have an effect. We are investing a lot in the technology in those two divisions in order to have an overhead that is less than the year before. Because you know, that's the name of the game. If you look at a successful company like UPS and FedEx, I mean these guys are investing heavily in technology to do the same. Us, we are trying to imitate these winners, okay? So that's one.

Number two is, in the midst of our business, sometimes there is a change. For instance, the more energy companies that you've got, these guys are able to turn more dollars per dollars of SG&A, you understand? So that, you know, is helping us in that trend. But definitely, our SG&A is going down as a whole because of the new technology that we are investing in our LTL and parcel. The same thing also with the truckload, but it's to a lesser extent, okay? But the mix of TransForce is helping us as well.

Okay. Lastly, one of the rumblings and results you've been seeing from some others in the U.S. is the U.S. LTL market seems to be softening. Have you been seeing any of this in Canada yet, or do you foresee this coming to Canada?

Well, you see, I can't talk really about the U.S. because what you see in the U.S. is U.S. domestic, okay? Us, the relationship we have with the Americas is the U.S. international business. On the U.S. international business, let's say between the U.S. and Canada, this is a market that is still growing, okay, because we are still importing more from the U.S., because of the favorable dollar for the Canadian, okay? So, our traffic within the international is growing more than our domestic.

Now, the LTL, in my mind, is fueled a lot by the consumer. In Canada, we see, out West for instance, big growth because the consumer is spending a lot of money, right?

Right.

(multiple speakers)

Are they changing their trends out East, though? Do you see the consumer maybe slowing their spending down out East? House prices seem to be less robust than they are out West. Our there trends that might lead you to believe that you might see the consumer cut back on their spending?

Not yet, not yet, Cameron. We haven't seeing any changes so far.

Okay, very good. Thank you.

(OPERATOR INSTRUCTIONS). Walter Spracklin, RBC Capital Markets.

Yes. Just back on the Forestry Products division, Alain, you had mentioned that lumber is not a big chunk but I guess Forestry Products is probably your biggest sector.

Yes.

By itself, around 15% of your revenue. That's mostly pulp and paper, I guess. The rails are talking a lot about how they are stealing market share from the trucks. CN just did that in their last conference call. Are you seeing increased competition from the Railways and are you seeing some of your customers moving their freight over to rail instead of going by truck?

Yes, we saw, okay, you know, if the market is soft for the forestry, the pulp and paper business, and the customer wants the, let's say, a shipment in two weeks, he's selling to this guy because he can't sell to no one for tomorrow. So definitely if he's got two weeks of leadtime, he's going to use the rail, no question about that. So yes, Walter, we saw a little bit of decrease.

Now, let's say that the day the wind starts to change, okay, so the leadtime is not two weeks, it's two hours or two days, I mean he is going to turn around and go back to the truck. But lately, it's just because of the leadtime of some shippers. For instance, Domtar, okay, I mean they are shipping a little bit more with the rail. (indiscernible) in Quebec, but again is this is not something new. It's something that we see every six months, nine months, and then it comes back and then, you know, but it's been a little but more over the last 18 months for sure because we are having a tough time shipping Canadian products into the U.S. because of the dollar. This is not something new.

Okay. One last comment on, you know, we do ask a lot of questions around volume and pricing and you give us great color during the call and I appreciate that. Just as a request, I don't know, I know your competitors don't do it either, but if you could provide any volume data in your quarterly results whereby broken down by the segments (multiple speakers) provide.

Walter, we are going to be answering your question pretty soon because we will be reporting volume on our LTL. We are working on that right now to do like it's been done in the U.S.

That's fantastic. All right, it's great to hear. I appreciate it. Okay, thank you.

No, it's very important for you to understand, yes.

I appreciate it.

Gentleman, there are no further questions at this time. I will turn the call over back to you.

Thank you, operator. Since there are no more questions, I want to thank everyone for participating in this conference call. For any of you who joined while the call was in progress, a recording will be available until October 31, 2006. You can get that by calling 1-800-558-52 (technical difficulty) or 416-626-4100 and entering passcode number 21306817.

Thank you all. Have a good day.

Well, thank you.

Thank you.

Thank you. Ladies and gentlemen, this does conclude the conference call for today. We thank you all for your participation and ask that you please disconnect your lines.