Trinity Biotech PLC (TRIB) 2007 Q2 法說會逐字稿

Greetings and welcome to the Trinity Biotech second-quarter earnings conference call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. (Operator Instructions). As a reminder, this conference is being recorded.

It is now my pleasure to introduce your host, Mr. Ronan O'Caoimh, Chairman and CEO for Trinity Biotech. Thank you. Mr. O'Caoimh, you may now begin.

Thank you. Good morning and welcome to the Trinity Biotech quarter two 2007 conference call. I'm joined by Rory Nealon, our Chief Financial Officer who will bring you through the results for the quarter; and by Brendan Farrell, our President, who will bring you through a review of the revenue performance for the quarter; before then opening the call to your question-and-answer session.

Before we proceed however, I'm required to read the Safe Harbor provision as follows. Forward-looking statements in this release are made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that such forward-looking statements involve risks and uncertainties including but now limited to the results of research and development efforts, the effective regulation by the United States Food and Drug Administration and other agencies, the impact of competitive products, product development commercialization and technological difficulties and other risks detailed in the Company's periodic reports filed with the Securities and Exchange Commission.

So, at this point I'll hand it over to Rory.

Thanks, Ronan. Our plan, as usual, is to take you through a review of the income statement and also an overview of the key movements in our balance sheet.

So starting as usual, with our revenue performance, as normal you'll note from the press release that analysis of the revenues by key product area and also by geographic location for the last six months. Looking at total revenues, you'll notice that our revenues for the period have increased by 43% on the same period last year. Obviously that 43% is in part due to the acquisition of bioMerieux in June last year. In fact, if you strip out the effect of the bioMerieux acquisition, our organic growth has been approximately 12%, half on half.

Quarter on quarter, our revenues of quarter one versus quarter two, have also increased despite slower than expected growth in our flu antibody business. And I will remind you that we sell a lot of flu antibodies down into the Asian market in quarter two and quarter three, and this year that business has been slower; which as you can appreciate is not something which is within our control, given that it's an outbreak-related disease.

While I wouldn't get into the detail on the movement by product category and geographic location, I'll move on to our gross margin performance and Brendan will shortly take you through a more detailed analysis of the revenues by category.

Our gross margins, at 48.1% for the quarter are again marginally better than what we and the Street expected. You'll recall our historic margins have typically varied between 48 and 50%, depending on product and geographic mix issues; and that we told you this time last year to expect some downward pressure due to the bioMerieux acquisition, namely the greater mix of instrument sales which would ensue and the transition costs which would be with us during 2006 and 2007.

These transition costs have come through to some extent and in fact we expect the worst of it to be over by the end of quarter three. Thereafter, we'll be manufacturing the bioMerieux agents in our haemostasis facility in Bray, and those transition costs will diminish further over quarter four and say quarter one of next year.

In fact, despite those transition costs which we have incurred to date, we have managed to maintain our margins in the 48 to 50% range in the current quarter, which is better than expected; either internally or by the analysts for that matter.

Moving on to our indirect expenses, you can see our R&D is consistent with last quarter at $1.78 million, ancillary admin expenses are also reasonably consistent with quarter two expenses of $12.3 million, being marginally higher than $12 million last quarter, quarter one; the marginal increase being in part due to increased SOX cost as this being our first full year of SOX involving (inaudible).

If you take our admin costs to date of $24.3 million or $48.6 million annualized, you can see that we're still within the analyst range of expectations which is in the $48 to $50 million range.

Moving on to our net financial costs; as you would expect, our interest expense is the same as last quarter. And just remind you, we have a five-year term loan facility from the banks with repayments on the first of January and the first of July each year. So you would expect no change in our interest expense from quarter one to quarter two. And meanwhile, our interest income has declined marginally from $210,000 to $149,000, due to the expected reduction in our cash balances caused by CapEx associated with the new factory and also build up of our bioMerieux inventory; both of which I'll come back and talk to later on when we get on to the balance sheet.

Before concluding on the income statement, it is worth touching on taxation, our EBITDA and our operating margin. So at the taxation line, you'll see that the one soft credit last quarter caused by the deferred tax effect of our new inventory holding policy has disappeared as expected, and we are now back to an effective rate of almost 15%. And going forward, we'd expect that rate to be in or around that number or potentially somewhat of an increase as our profitability levels increase, in particular in the US market which is a higher tax environment for us.

Moving on to our EBITDA performance, it is worth noting that our EBITDA has improved from $3.5 million in quarter two last year, to $6 million in quarter two this year; in a large part due to the success of the bioMerieux acquisition and despite the various costs we've had to incur during that transition period. So that's some performance.

Finally before moving on to our balance sheet, it is worth discussing our operating margin which is the most important metric that we track. You will have heard us say on many occasions that our goal is to get our operating margin before share option costs, back about 12%, where we were before we launched our direct sales force in the USA in 2003 and which I might add is also the industry standard.

As I have just noted, this is the key performance indicator in assessing how the Company is performing. If you go back and track and the trend on those margins over recent quarters, you'll notice that it's been a solace. Quarter one last year was at 7.9%, then 8.6% in Q2, 9.9% in Q3, quarter four with an aberration at 3.8% because of the revenue deferral we previously discussed, quarter one increased again to 10%, and in quarter two just got us at 10.9%. So you can therefore see that that trend is definitely moving in the right direction and we're getting closer to that holy grail of ours at 12%.

Now to talk about our balance sheet; if we start with our property, plant and equipment; the movement since the beginning of the year is a combination of additions of about $2.5 million, as offset by depreciation of $2.1 million. As you would have expected, the run rate on our additions has increased quarter one on quarter two due to the kitting out of the new factory for the bioMerieux business.

Our goodwill and intangible assets lines has similarly moved forward through a combination of amortization of $1.7 million and various additions associated with development projects and particularly projects such as the Destiny Max and the Tri-Stat, which Brendan will shortly talk to.

Moving on to inventory which is worth dwelling on for a minute, our inventory has increased by $6.6 million since December, which is totally due to the recent bioMerieux acquisition. In fact our bioMerieux inventory has increased by $6.9 million during the period. So it's more than 100% responsible for the overall increase.

Just to recap for those of you who are new to the story, bioMerieux have been building 18 months worth of inventory for over a 12-month period to the target of June 2007. And as such, our inventory has been climbing during that period. The logic of the increase build being to create a buffer of stock while we transferred manufacturer from bioMerieux's facility in Durham, to our new haemostasis factory here in Ireland. Obviously, going forward over the coming quarters, we're expecting our bioMerieux inventory levels to start reducing back to more normal levels.

Our trade and other receivables balance is comprised of both trade receivables from customers and also some prepayments. Our trade receivables is something we get asked a few questions about. They've continued to reduce over recent quarters, from 76 days in quarter four, to 67 days in quarter one, and again to 66 days during the recent quarter; largely down to the timing of orders but also due to a very successful cash collection campaign.

Finally on the balance sheet, our cash has reduced from $18.3 million at the end of last year to $9.1 million at the end June, largely down to a combination of factors such as the debt and interest repayment of about $5 million on the first of January, $3.2 million of deferred consideration to bioMerieux at the end of June, and also to the increase in inventory of $6.6 million we just discussed.

So just to wrap up on my review, it's worth noting that we're very much executing the plan which we set out at the start of the year. And while we don't normally give guidance, we did at the start of the year say that we wanted to if you recall, we wanted to exceed $150 million in revenues, we wanted to hit an EBITDA number of $25 million and we wanted our EPS to be north of $0.57.

So far this year, our revenue is at $74.1 or $148.2 million annualized, so not a long way at all away from our target of exceeding $150 million. Our EBITDA is at $11.5 or $23 million annualized, again very much on track. And lastly, our EPS is at $0.291 or $0.582 annualized, so actually ahead of our target we set out at the start of the year. Brendan?

Thank you, Rory. I'd like to start by reemphasizing a point that Rory made; and by comparing these first revenues of 2007 with the same period last year. When I strip out the bioMerieux revenues from both periods, the organic growth achieved in the first half of 2007 over 2006 was just over 12%. This is an excellent performance against a background where our industry is growing at approximately 6% per annum.

I'd now like to provide you with a little more detail on each of our four business units, starting with clinical chemistry. In the first half of this year, our clinical chemistry business grew from $7.5 million revenues in the same period last year, to $8.3 million for this period; representing an organic growth of over 11%. This strong organic growth occurred both in our esoteric clinical chemistry line and in our Primus product line.

We're looking forward to the pending launch of our rapid point of care haemoglobin A1c system which we will market under the name Tri-Stat. This platform will be introduced in physician offices, diabetic clinics and as well as in hospital labs. Unique to Tri-Stat in the point of care segment will be the ability to run three patient samples simultaneously.

We are seeking from the FDA a physician office home use classification in the CLIA waiver, as this classification will grant physicians a reimbursement of approximately $8 more per test than provided by our competitors. In other words, if you have a classification for home use, the reimbursement is approximately $21 per test, and if you do not, the reimbursement is about $13 per test. We expect to launch Tri-Stat into the US market in early Q4 of this year.

Turning now to our haemostasis business which in the first half of this year represented 44% of our total revenues; revenues for the first half were at $32.5 million compared to $14.8 million for the same period last year. This represents a growth of 120%, which is primarily driven by the acquisition of the bioMerieux haemostasis business in late June of '06. However, when we strip out the bioMerieux revenues and look at the underlying organic growth in our business during this period, we see that organic growth was 13% in the first half of 2007. This is an excellent performance in a market segment growing at 5 to 6% per anum.

We remain very excited about the prospects for the Destiny Max instrument which is nearing the end of its development phase, and will shortly start verification and validation studies. The Destiny Max will target the large hospital segment of the haemostasis market, which yields substantially higher revenues per instrument placement than the mid and small sized segments in which we currently operate. We expect the international launch of the Destiny Max to be in Q1 of '08 and the US launch in Q2 of '08.

Moving to infectious diseases now; in the first half of 2007 our infectious disease business represented 27% of our total revenues. The business declined 4% over the same period last year, primarily due as Rory has already indicated, to weakness in our Fitzgerald raw material supply business. The sales of Fitzgerald influenza antibodies, which we would normally expect in Q2 of each year, have not materialized at anything like the levels seen in prior years.

Our hospital-related infectious disease business grew 5% in the first half of the year over 2006, which is a satisfactory performance.

Turning now to point of care business, which is mainly our HIV business; during the first half of 2007, revenues in our point of care business accounted for almost 18% of our total revenues, which is up from 13% of our revenues in 2006. During our quarter one conference call in April, I indicated that our Q1 point of care revenues have been exceptional and we did not anticipate a very strong quarter two in this segment. However, this turned out not to be the case as our quarter two was almost as strong as quarter one, and our organic growth in the first half over the comparable period last year has been over 50%, which is an outstanding performance for this business unit.

Our recent agreements with PEPFAR and the Clinton Foundation are helping to drive strong revenue growth in less-developed countries, particularly in sub-Sahara in Africa. Our transition of the manufacturing of the Uni-Gold HIV product sold outside the United States to China is now complete. And as a consequence, we are seeing considerable gross margin improvement in this segment of our business.

In the US market, we continue to take market share from our competitors, both in the hospital and in the public health area. Our prospects for growth in the US market are enhanced by the $35 million in new money, which the CDC will shortly make available for HIV testing in jurisdictions where the population is disproportionately affected by HIV.

Regarding the HIV OTC, our home testing opportunity, we continue to progress our efforts in relation to seeking approval from the FDA for our Uni-Gold HIV product in this new market segment. I should say that the market estimates for OTC HIV testing published by one of our competitors, are viewed by us with some considerable skepticism. We do not think that home testing for HIV represents a very significant market opportunity and we're working hard to confirm this through market research efforts.

Overall, our business is in excellent shape as we move into the second half of 2007. Through our own direct sales forces in the USA, Germany, France and the UK; we cover over 65% of the world's diagnostic market. The bioMerieux acquisition has made these sales forces more productive and will allow us to demonstrate continued improvement in our performance in revenue, gross profit and operating profit terms in the remainder of 2007.

Back to Ronan, now.

Thanks, Brendan. Jackie, I wonder if you could open the call now for questions in a question-and-answer session.

Thank you. (Operator Instructions). Our first question is coming from Matt Dolan of Roth Capital.

Hi guys, good morning. A few questions; first on the point of care business -- two questions; can you comment more on the CDC HIV funding and your expectations for how much of that will be allocated specifically to rapid HIV testing? And what do you expect in terms of the amount that you could potentially capture there?

Hi Matt, this is Brendan. Just to clarify and give a bit more color on that; we think the monies will slow from the first of October of this year. We think that all of the $35 million will be spent, or most of it will be spent on rapid HIV testing over a period of time. It will be targeted at jurisdictions, as I said, where there is a disproportionately high incidence of HIV, and will primarily be targeted at African Americans who are suffering more from HIV infections than other populations. Can I provide more detail than that?

So it starts in October, and then is there a timeline when it ends; is it a year long initiative?

It is a year long initiative, but it will recur going forward.

Okay. And then looking on the OTC side; in terms of timing of approvals there and so forth, are you tracking basically simultaneously with the other companies pursuing the OTC or is there any reason to think that any of the players pursuing that market should have significantly different timelines there?

We obviously don't have full detail on what our competitors are doing; but as far as we are aware, we're within the same timeline as they are.

Okay. And then looking forward at the rest of the year now that in 2007 haemostasis is a much bigger proportion of revenue than it has been in the past; does that impact the seasonality overall for Trinity that we've seen in the past or can you redefine seasonality now with a different mix here going forward?

It has a slightly -- it reduces somewhat the impact of seasonality. I think that's fair to say. As I mentioned, infectious diseases, which is the major segment of our business subject to seasonality; as a proportion of our total sales has reduced to 27%. So therefore, the seasonality that comes with infectious disease will have a reduced impact on the overall business.

Okay, great. And finally, with respect to the acquisition outlook; would you say that bioMerieux is integrated relative to the upper management level or is it at least at a point where you're starting to look at new opportunities?

I think we have a history of always looking at acquisitions but, I think we would regard ourselves as still digesting bioMerieux and so we wouldn't anticipate anything significant in the short term.

Okay, great. Thanks a lot guys, nice results.

Matt, Brendan here. I just wanted to come back on something I said. I may have misled you. The $35 million; about a third of that will be spent on actual test devices, but all of it will be spent in or around HIV testing, either in marketing, training, new staff or whatever. But on actual test devices, about $12 million of it will be spent.

$12 million on rapid HIV, okay. Great; thank you, guys.

Our next question is coming from Ian Hunter of Goodbody Stockbrokers.

Good afternoon, gentlemen. Goodbody Stockbrokers, here; (inaudible) I've just a couple of questions for you. First of all on the product line, the point of care you say was very strong this quarter. I know you did say that, Brendan you thought that Q1 '07 was going to be exceptional for the year. But I'm just wondering; can we see this now as a quarterly run rate for the point of care at the $6 million-plus kind of level, firstly? And then secondly, on the haemostasis, actually the revenue line for the last three quarters has come off slightly; kind of flat this quarter. It was off from the last quarter of '06. I was just wondering how you can see the business progressing over the rest of the year and how we can look to see revenue growth in that area.

Dealing with the point of care first Ian; no, I don't really see Q3 and Q4 as having the same strength as Q1 and Q2 in the point of care area. But then having said that Ian, we don't have as much visibility on future orders in HIV as we would have in other aspects of our business; quite simply, when your dealing with sub-Sahara in Africa the forecasting and visibility is not as sophisticated as it is in other areas of our business.

So I was glad to be wrong about quarter two and I'll be very glad to be wrong about quarters three and four. But I do think that you won't see the same level of strength in Q3 and Q4 related to the point of care business.

And when you say that there's been drop off in coagulation, we maybe beg to differ. I mean our quarter one and two numbers are identical.

Sorry. I've seen that. (Inaudible) and 16.28, actually it's up slightly. But in Q4 '06 it was 16.6. I was just wondering-- are we just going to see a flattening trend at the moment during the integration process of the bioMerieux or will we start to see it tick up now that you've gone into the Q3 and you're saying most integration process is complete.

Well I think -- first of all let me say that our growth target for haemostasis is similar to the other business units in that together we want to drive more than 10% organic growth. And as you can see, that's got to come from haemostasis, being the largest proportion of our business. We are very much focused on the Destiny Max to provide a lot of that growth for us, given that we do not today compete for new business.

And I should stress we do not to date compete for new business very successfully in the large hospital segment. We are present in the large hospital segment through existing placements of bioMerieux analyzers called the MDA analyzer. But in terms of competing for new business, we can't really do that until we get the Destiny Max out. And that will be the major growth driver in haemostasis. And we would expect -- and you will not see this until the second half of '08, to get organic growth above the 10% level in that segment.

Okay, thanks so much. Maybe just a quick follow on there for Rory and Brendan as well; you did remark there on the gross margins Rory, that is was stronger than we maybe all expected. And I'm just wondering whether is that a factor of the China facility opening up and maybe more emphasis on the point of care tests in the Asian-African region? And can we see this kind of margin level through to the end of the year?

Not particularly due to China in the sense that China really only came on stream at the back end of the quarter. It's more been down to just good containment of the costs associated with the transition of bioMerieux. We had expected that it would impact more on the numbers, but we've been able to curtail those. And really we've got about another three months of -- if you like, needing to do a continued good job to keep those costs down. At the end of September, the worst of the transition if you like, will be over and that we'll now be up and manufacturing product for bioMerieux and while those contribution costs will continue for another couple of quarters; after that they will be at much lower levels.

So, on a go-forward basis if you like, if anything there is upward pressure on the margins. For that reason, for the China reason whereby we'll be making the African HIV products at a 60% margin as opposed to a 40-45% margin, and obviously as our sales of HIV into the USA continue to increase at an 80% gross margin; that would also provide upward pressure. So at or about the 48% level is where we're targeting, going forward.

I think the other thing clearly that isn't helping us is of course the dollar rate, so clearly-- that's an adverse effect at the moment.

Okay, thanks very much.

Our next question is coming from Jack Gorman of Davy.

Thanks, guys. A couple of questions please; firstly, maybe Rory you mentioned in passing there the revenue deferral issue from the back end of last year. I was just wondering if that had any impact or flow back during the quarter.

It did. It's difficult to give too much specifics given it is client specific, but the reality was it was of an order of magnitude similar to quarter one, slightly less in the order of $300,000 to $400,000, Jack.

Okay. So there is still a little bit left to go in that Rory?

There is a bit, there is. Yes.

Okay; perfect. The other two questions I suppose are broader ones. One is an integration question. I think on previous calls, Brendan, you would have mentioned one part of the whole integration process of bioMerieux was to align and reconfigure your distributor relationships. I was just wondering if you can give us maybe an update on that.

Okay, Jack, yes. I have made the point a number of times that part of our key strategy today for three of our four business units is system selling, meaning the ability to sell or place instruments on the basis that we will get the major return from sale of consumables and reagents. Not all of our distributors are successfully aligned with that strategy; either because they don't have the financial resources or don't have the overall strategy or the engineering support to do that. So we are in the process of optimizing our distribution channels. Some of that is done, not all of it is yet done and that's still work in progress for the remainder of 2007.

Okay, but very much as expected, Brendan; in terms of what you would originally [believed] some 12 months ago?

Yes, very much so. Yes. There is one glaring gap for us where we need to really get distribution in place going forward, and that's in Japan. And we are very much in discussion with one particular party there right now to take that over from in fact bioMerieux, who continues to distribute there at the moment.

Okay, perfect. I suppose a slightly related question, Brendan; you mentioned obviously Destiny Max and the impact that's going to have on organic growth across the division and across the group as a whole. Maybe it's a little early to ask this question but what is your own sense in terms of how you will do that system sell? It's a market that you said you obviously have exposure to, but you haven't had a huge of success in, given the kind of older product line that you have. I suppose can you give us any flavor of that at this stage? Is this going to be a very high profile launch that you'll essentially try and kind of flood the market as such? Maybe that's too aggressive of a word. But what's your own thinking on that at this stage?

The thinking for any kind of instrumentation is always to start with a limited launch so you control any bugs that enter into the system; and there always will be bugs in an instrumentation launch. So you tend to roll it out. First of all, we will be rolling it out in Europe, so the markets we would be looking at would be markets where we have our direct sales forces. And the UK, being so close to us geographically, would be the most-likely place for us to start.

In addition to the fact that it's geographically close to us, it happens to have the second-highest population of large bioMerieux instruments. And those instruments are ripe for replacement in the next 12 to 24 months. So the UK would be a very logical place to roll it out first, and that's in fact where we're targeting. So it will be a limited rollout, Jack. It certainly won't be a flooding of the market. [We wouldn't have] the capability to support it. And that would be a tactic that would be employed by us, but anyone of our competitors as well.

Okay. And just on that point, Brendan; you mentioned you obviously can see an immediate market in terms of replacing existing or old bioMerieux instrumentation. Presumably that's Phase I of the launch. And then Phase II would obviously be to expand the client line?

Absolutely correct. We would first of all sell it to our own existing customer base and then into potentially new customers.

That's great. Thank you very much, guys.

(Operator Instructions). Our next question is coming from Stephen Handley of Dutton Associates.

Thank you and good afternoon. It was commented on that someone has a market research study on the OTC market for HIV testing that you apparently didn't agree with. And I'm not clear as to what you said after that, whether you thought they were too high or too low. Can you mention what the magnitude of that dollar figure was in that study and more specifically your take on it? And then go on to just recap what steps you have taken related with the FDA, regulatory approval steps; what issues are there with the FDA and specifically what is the hope for a time table for approval?

Okay, Steve. Hi, this is Brendan here. First of all, one of our competitors; I don't know that they so much issued market research, but they gave some kind of guidance in one of their conference calls that they felt that the home testing market or the OTC market, however you want to characterize it, had a potential size of $500 million, with the unit price of $100.

We think that both of those estimates are very high and we do not agree with them, but we're conducting our own market research to verify or not, or dispute those particular numbers. That was the first question you had.

Secondly, in terms of what we're doing with the FDA; quite obviously and I should stress this in case people don't understand it, the product is already FDA-approved. So we don't have to prove once more the efficacy of the product. It's got 100% sensitivity and it still has 100% sensitivity, so that hasn't changed. And there's 99.7% specificity. What we have to prove is that the ability of a non-trained person going into a drugstore, buying the product and running in their own home; that they can functionally run the product and interpret the result the same way that a healthcare professional can.

So that's what the trials are aimed at; at elucidating, and we have already conducted some of those trials in Los Angeles and we'll continue to conduct them. And we're in continual dialog with the FDA.

And I believe the other question you asked was timeline. As we know very well from this conference call and many others; we don't control the FDA's timelines and don't know how long of a review period they will need, but we're talking some time late 2008 for approval.

Okay. Thank you very much.

Our next question is coming from [Mark Lipton] of [Lipton & Lipton Pension Fund].

Good morning, everybody. Any plans on or any efficacy in automating the Uni-Gold HIV product?

Are you talking Mark about automating the production or automating the testing process?

The production.

Well, there are no specific plans to do that. It's a fairly labor-intensive process and one that doesn't terribly easily lend itself to automation, which is precisely why we moved it into a jurisdiction with low labor costs, in other words into China, for the international market. And as you see, that has had a pretty dramatic effect on our gross profit margins going from 40 to 45% up to 60%; and maybe if the Chinese, in their wisdom, can find a way to automate it that we're happy with, while we'd be glad to take a further reduction in cost.

Well, that's what I was trying to explore; was the move to China to reduce the labor cost, basically your assessment of the best way to improve margins as opposed to trying to automate? And you're saying, yes that that's what we've done and we're going to improve margins in that method.

Yes, indeed. And in fact, in that factory that's down there in China, they make other products which are significantly larger in throughput than our product. And they're also manually produced. Rapid tests don't necessarily lend themselves to automation.

And my other question is, in terms of public perspective of the Company; the stock is incredibly thinly traded. Is there anything in public relations or anything on the horizon, aside from just time and more products and more exposure little by little, that you think is going to be happening that maybe we could get a little bit more interest in the Company that's doing so well, to generate more trading and hopefully a higher stock price? But the ability to trade in and out of the stock (technical difficulty) selling and having the prices dramatically drop.

One of the key targets we had over the past couple of years Mark was to change the shareholder profile in Trinity Biotech and to try to attract more institutions into the stock. When we started that program two years ago, approximately 10% of our shareholders were institutional, and now our best estimates would show that greater than 40% of our shareholders our institutional. So we have been working pretty intensively on that, and we continue to have intensive investor relations programs on a monthly basis, where we're out telling the story in the Street, whether it be in New York, Boston, San Francisco, London, Zurich or wherever. We do spend a lot of time in telling the story and trying to get the word out on the Street. And yes, we agree with you; it is a thinly traded stock and we simply believe we have to keep telling the story and keep producing the results, and the volume and the price will follow.

Okay, thank you very much.

Thank you. There are no further questions at this time. I'd like to hand the floor back over to management for any closing comments.

Thank you, Jackie. We'd just like to say that we'll close the conference call and we thank you for your interest and your support and look forward to talking to you again next quarter. Good afternoon.

This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.