UGI Corp (UGI) 2008 Q1 法說會逐字稿

(OPERATOR INSTRUCTIONS) . Good day and welcome to the UGI and AmeriGas Partners first quarter conference call and webcast. As a reminder, this call is being recorded. At this time, for opening remarks and introductions, would you like to turn the call over to Vice President and Treasurer, Bob Krick. Please go ahead.

Thank you, Allen. Good afternoon and thank you all for joining us today. As we begin, let me remind you that our comments will contain certain forward-looking statements which the management of UGI and AmeriGas agree to be reasonable as of this date only. Actual results may differ significantly because of risks and uncertainties that are difficult to predict and many of which are beyond management's control. You should read the annual reports on Form 10-K for a fuller list of factors that could affect results but among them are adverse weather conditions, price volatility and availability of all energy products including natural gas, propane and fuel oil, increase customer conservation measures, political, economic and legislative and regulatory changes in the U.S. and abroad, currency exchange rates and competition from the same and alternative energy sources.

UGI and AmeriGas undertake no obligation to release revisions to these forward looking statements to reflect events or circumstances occurring after today. With me today are John Walsh, President and COO of UGI. Gene Bissell, President and CEO of AmeriGas and Peter Kelly, CFO of UGI and of course, your host, Chairman and CEO of UGI, Lon Greenberg. Lon.

Thank you, Bob. And welcome everyone. I trust you've all had the opportunity to review our press releases reporting our first quarter results. To summarize, UGI reported earnings per share of $0.74 for the first quarter, an increase of 28% over last years $0.58. AmeriGas reported EBITDA of approximately $93 million, virtually unchanged from last year with net income of $54.3 million being slightly down from last year's net income. This was a very good quarter for us as our utility, energy services and international propane businesses had double-digit increases in operating income. There were differing drivers for this improvement in our overseas propane distribution services, winter weather returned to more normal levels compared to last year's extraordinary warmth, therefore you saw significant volume improvement and that's what drove the results.

On the utility side, our utility businesses benefited both from investments made for customer growth and further improvement in the performance of our Penn Natural Gas acquisition due to both the achievement of additional synergies and the full-year effect of a rate case from last year and lastly our Energy Services businesses benefited from higher electric prices and capacity charges received on our electric generating assets as well as new sources of income from investments made over the last few years to provide natural gas peaking services to gas utilities. AmeriGas's results were flat with last year. This was principally due to volume being somewhat lower than we expected, was essentially the same as last year. We expected to see growth in volume both from our customer growth last year as well as the full-year effect of several acquisitions we completed last year. However, warm weather, different weather patterns than last year and to some extent customer conservation all led to volume following below our goals. Gene will have more to say on this, but the flat volume performance is not of undue concern to us, especially given volume performance to date in January, which is in line with our expectations. But of course, a lot of winter remains to be seen.

At this point, I would like to turn it over to Peter Kelly, to provide you with financial overview of our performance, following Peter will be John Walsh when will comment further on our operating performance. Gene Bissell will then pick up and give you an overview of AmeriGas's performance and then the microphone will be returned back to me for concluding remarks. Peter.

Thank you, Lon. As noted in our earnings release this morning, we've gotten off to a very good start to the year. Earnings per share were $0.74, a 28% improvement on the $0.58 reported the the same quarter last year. Double-digit growth in earnings in utilities, energy services and international propane more than offset the small decline in earnings we experienced in our domestic propane business. I would now like to spend a few minutes outlining the year-on-year performance of our main business segments. Net income in our gas utility increased $7.5 million to $24 million, and on weather that was 6.2% warmer than normal versus weather that 15% warmer than normal last year.

Crude put increased by 6.1 Bcf to 39.5 Bcf, reflecting the effects of colder weather and customer growth. This along with a full quarter at the PNG rate increase that came into effect on December 1,2006 and lower operating expenses were the main drivers for the substantial increase in earnings.

In our electric utility, net income increased $800,000, to $4 million, on weather that was approximately 9% colder than last year. But still almost 7% warmer than normal. We sold 254.4 gigawatt hours, up 2.2% on the same period in 2007. And this, along with the rate increase that went into effect on January the 1st , 2007, drove the increase in net income.

In energy services, net income was $13.9 million, up $4.9 million from the $9 million reported in the first quarter of 2007. The investments in our asset-base on the execution of our peaking strategy, continued to drive excellent returns. In addition, net income from electric generation increased by $2.1 million, following the recent run up in electric prices. In international propane net income was $22.4 million, up just over 22% on the $18.3 million reported last year. Essentially, we have seen a substantial recovery in volumes from last year, but margin growth has been dampened by the amazing run up in LPG commodity cost. With Euro dominated LPG prices up over 30% on the same period as last year.

In the Antargaz Service territory, temperatures were approximately 6.3% colder than normal, compared to temperatures that were 21.7% warmer than normal in the same quarter last year. Antargaz sold approximately 98 million retail gallons of LPG in the first quarter, up just over 22% on the same quarter in 2007. Flaga's volumes increased by approximately 13% in the same period. With regard to the domestic propane business, AmeriGas net income was $15 million compared to $15.4 million in the same period last year. On weather that was 7.2% warmer than normal, versus 8.6 warmer than normal in the prior year. Retail volume was 279 million gallons, down from 283 million gallons last year. The warm weather coupled with significant increases in sales -- in sales prices driven by extraordinarily high wholesale propane costs have resulted in customer conservation. Gean, as always, will provide a more detailed review of AmeriGas's performance in his comments.

Now moving to the balance sheet, as of December 31st, our consolidated debt was $2.4 billion, versus the $2.3 billion reported in the same period last year. And our consolidated cash was also up $232 million, versus the $154 million reported last year. AmeriGas finished the quarter with $20 million of cash, and $999.6 million of total debt, including $67 million of its revolver.

So in summary, a good start to the year. Good progress in our businesses and strong liquidity. With that, let me pass the call over to John Walsh, who will expand on our domestic operations.

Thanks, Peter. Lon and Peter have both commented on the key drivers for our strong first quarter performance. I would like to focus my remarks on critical achievements within each business in Q1. Our Utilities business delivered a strong performance in the quarter as we benefited from weather in the gas services territories that while still warmer than normal was almost 9% colder than last year. Gas through put increased by 18% driven by weather related demand and growth in our customer base. Operating income for gas utility increased by over 30% to 50.1 million, due to the increase in throughput and to a lesser extent reduced operating expenses.

Our PNG integration plan remains on track as we enter the second full fiscal year with our expanded gas utilities operations. We were pleased to be recognized for the fifth consecutive year with the JD Power Award for Customer Service as the Top Rated Company among Northeast Gas Utilities. This is the first year where the customer survey included the PNG customers. Growth in new gas utility customers during the first quarter ran about 10% below last year. We're monitoring activity closely with our leading commercial and residential developers and focusing on opportunities to generate growth in other segments such as the conversion market during the cyclical downturn in the new housing market.

Our Electric Utility delivered another in a series of strong quarters. Operating income increased to $7.2 million due to a combination of increased throughput, higher rates and a slight reduction in operating expenses .

Our Energy Services business continues to perform at a high level. Operating income increased by over 50% in Q1to 23.7 million. Our Peaking and Asset Management segment had a particularly strong quarter as we benefited from the expansion of our Peaking Services customer base and higher contract charges. We made excellent progress on our two new peaking projects in Q1. These new units augment our peaking capacity for the 2007-2008 heating season. Energy Services also benefited from higher unit prices and capacity values within its electric generation segment. We continue to be excited by the growth prospect for energy services.

Gene will provide you with detail on AmeriGas's first quarter performance. The dramatic increase in propane cost over the past year provided a significant challenge for the AmeriGas team in Q1. Volumes fell slightly versus Q1 FY '07 and EBITDA was essentially flat from the prior year. We continue to progress our long-term strategic programs in AmeriGas. Among the achievements in Q1 were the successful completion of the integration of the All Star acquisition which closed in August. This integration was completed well ahead of our original timetable. Performance in Q1 for the businesses acquired from Shell and All Star in 2007 have exceeded their business case objectives. We also saw continued growth in the [A ]cylinder exchange business during the off season. Q1 volumes exceeded prior year by over 20%. I would now like to turn it over to Gene who will provide you with more detail on AmeriGas's performance.

Thanks, John. As Peter mentioned, AmeriGas's reporting EBITDA that is equal to last year, despite slightly lower volumes. The volume in the first quarter was somewhat below expectations given that weather was a bit colder than last year and we had the benefit of additional volume form the acquisitions we completed last year. Our customer account is up even without the acquisitions. So we have to attribute the lower volume to lower deliveries per customer. While it's difficult to draw any firm conclusions until the end of the heating season, it appears we may be experiencing customer conservation due to the dramatic increase in propane prices. Also propane prices at Mt. Belvieu averaged a $1.51 in the first quarter a 58% increase from the first quarter of last year. This higher cost was reflected in our selling prices to customer. Our average selling prices increased from $2.01 a gallon to $2.51 a gallon or 25%.

Wholesale propane is trading today at $1.50 a gallon, about the same level as the first quarter average. The cost continues to move in proportion to crude oil. Just a few weeks ago when the price of crude was in the range of $100 a barrel, propane rose to a $1.64 per gallon. In addition to effecting our volumes, high energy prices are effecting our expenses, particularly in terms of diesel and gasoline for our vehicles, bad debt expense and utilities which together explained about 20% of the increase in our expenses quarter-to-quarter. Vehicle fuel expense alone was up 25%.

The acquisitions we completed last year and strong volume growth in [ACE] also contributed to the expense increase in the quarter. In reviewing our results it's worth noting that our trailing 12 distribution coverage excluding the effects of the [Bumstad] sale is 1.4 times compared to 1.2 X last year at this time. I'll given you some color on our financial results for the quarter, I'd also like to preview how we performed on each of our strategies. In our base business we continue to grow our customer count , excluding acquisitions but at a slower pace than last year. We continue to see the impact of the weak housing market in the growth of our traditional customer base. [ACE] Base had a strong quarter with 22% growth in volume, due primarily to adding new locations but also to a 7% same store sales growth rate. While [ACE] volumes are not very significant at this time of year, the growth that we've achieved in this business will position us well for the grilling season that begins in May.

Strategic account volumes were flat for the quarter but we did improve the customer mix and profitability of this part of the business. Another core strategy for AmeriGas is acquisitions. Last year we added 45 million-gallons through five acquisitions. The largest deals were Shell and All Star. We've been closely tracking the results compared to our performance of these two large deals and as John mentioned we're ahead of our projected EBITDA for the first quarter despite somewhat lower than expected volume. Looking forward we'll be watching our volumes for additional signs of customer conservation and adjusting our management of the business accordingly.

Before turning the call back to Lon, I would like to thank our employees for their hard work and dedication this quarter. Each season brings new challenges and I'm always impressed with how our employees work together to overcome those challenges while maintaining their focus on customer service and safety. Lon.

Thank you, Gene. Thanks, everybody. Let me leave you with the following thoughts as we end our prepared remarks. Overall, we are pleased with our first quarter's performance. It was somewhat better than we expected, especially given the fact that weather domestically was about 7% warmer than normal. As you know, I do not comment on earnings guidance for the year after the first fiscal quarter for us, this is because our earnings have some degree of weather sensitivity and significant of the winter remains. I will update guidance at our next earnings call in April.

There are certain points I would like to make about our performance. I know there was some concern and question about our international operations following the full open earnings from those businesses last year. We ascribe the falloff to the extraordinarily warm winter last year. Our volumes in our international businesses have fully recovered this year and I hope that removes any heightened concern about the performance of those businesses. This is not to suggest there aren't issues overseas with competition intensifying and with passing on cost increases rapidly to customers. What it does say is those issues are more like the challenges we face in any of our businesses that those issues are manageable. Performance of our utilities demonstrates that we are achieving the financial benefits we expected from the Penn Natural Gas acquisition, are happy with the way that integration is going, and look forward to continued good results there.

Similarly, the three facets of our Energy Services business are performing well. Our Gas Marketing business is achieving it's strategic goals, our Electric Generation operation is capitalizing on rising revenue streams from both capacity and commodity prices and our Natural Gas Peaking business is benefiting from investment we made and it's ability to provide a valuable service to its customers. We are seeing a variety of investment opportunities, both acquisition and internal investment. We continue to pursue suitable acquisition opportunities in all of our businesses, at the same time and for perhaps the first time in some time, we are also seeing opportunities to invest internally with internally-generated options as we capitalize on market opportunities. I consider this a very good development for the company.

Importantly, we have the financial resources to make many of these investments. We anticipate having approximately $200 million of investable cash by year end. Equally important is the fact that our balance sheets remain strong as Peter said they were.

In conclusion, we had an excellent first quarter, all of our businesses are executing on their strategies effectively, and we are not short of opportunity to make acquisition and internal investments and continue our track record of growth. At this point, Allen, I would like to turn the call over to the folks to ask some questions

Thank you very much. (OPERATOR INSTRUCTIONS). And we'll take our first question from Schneurger Shawnee from UBS.

Hi, good afternoon, guys.

Hi.

Lon, you ended your comment with about 200 million of investable cash and the balance sheet isn't in a position to make acquisitions and I guess my questions are along the lines of where do you see the best opportunities to make acquisitions and where do you believe the best internal opportunities are? Is it something that will be in the line of Flaga or China or is it something stateside and then secondly, how far are you willing to push the balance sheet, like -- is there a net debt EBITDA multiple that you're willing to take the balance sheet up to, is there a size of acquisition that you're willing to take on, be it 500 million or billion?

Let me try to take those in some order. With regard first to -- let's talk about internal investment opportunities because that somewhat of a change from recent years, certainly. We've also invested internally in what I'll call customer growth, there is a sizable piece of AmeriGas capital budget, the utilities capital budget and international propane that goes to what I would consider normal internal investment customer growth opportunities. What we're seeing in addition to that is some more internal investment opportunities of scale and I would say they're principally in the energy services area, energy markets are going through a great deal of change and some opportunities are presenting themselves. Directional these generated capital investments could exceed $100 million and we're looking at some electric generation opportunities, we're looking at natural gas peaking asset kind of opportunities as well, both of those of some scale, and also some renewable kind of opportunities. We have some opportunities to make some investment in renewable energy areas that look promising to us as well. And the internal investments, it's nice to see those arise for us because we have not had nonordinary course internal investment opportunities in some years and it's good to see those and they are all associated with pretty good returns.

On the acquisition side, we are seeing opportunities across the spectrum of our businesses. As you know, we have the normal propane acquisition, there are a few publicly announced acquisition opportunities in the utilities space. There are opportunities overseas as well, and to invest some money. We aren't in love with any one of those anymore than any of the others. I would tell you that we are focused on achieving our returns in all of those transactions. So that they add value to shareholders. We always will finance those prudently and we would do nothing that would jeopardize the credit rating of our utility. It is important that we maintain a strong investment grade credit there. We probably have a little slack on the AmeriGas side. The rating agencies do not seem to give us the credit which we believe we deserve for the strength of the balance sheet in AmeriGas and we think we have some room there to keep strong credit ratings while we pursue opportunities. But we're not going to do anything there that jepardize our credit rating in AmeriGas either. And lastly, the size of the cash that we have really gives us an opportunity to fund a decent size acquisition without any equity and that's a nice thing to have available to us as well. So we're looking at -- across a broad range and -- in all of our business units of acquisition opportunities and we're not limiting ourselves to scale where we feel really comfortable with the opportunity.

If I could just have one follow-up.

Sure.

To the question. When you talk about utility space in the past, you've mentioned you want to stay in your home court and so forth, is that still the case given that there is actually quite a few assets that are available in Pennsylvania and so forth?

Yes. That's largely still the case. We have long felt that you cannot -- you can't make a utility acquisition work on the backs of saving and corporate overhead and where we have unique advantages in the utility space or where we have broader synergies than taking out people and overhead so we look at staying pretty close to home in our utility acquisitions to ensure that we can accept -- get a return in those that's acceptable not only to us, but to our owners.

Great. Thank you very much.

Sure.

Next we'll take a question from Ron Londe from Wachovia.

Thank you. It looks like your operating administrative expense was up about $0.06 a gallon year-over-year. Is that something we should build in going forward into our model?

Ron, you're referring to the AmeriGas side?

Yes, AmeriGas.

It's up about $14 million.

Which is about the $0.06 a gallon. And again, Ron, some of that is run rates, some of it is fuel related.

It's a big growth in ACE.

Big growth in ACE as well. Which you do not see the benefit EBITDA wise at this point because of time of year that you would see for example in the summer and when that business turns into its season. But I don't think -- you would not take that number Gene and multiply it by four?

No.

Yes. So some of that is clear that you should build into your modeling, and some of that is stuff that is more seasonal and less of concern.

Some related to the integration of the acquisitions.

That's true. ( Multiple speakers )

We had some one-time expenses that would not reoccur in every quarter.

We do not think, I guess Ron, maybe the best way to answer your question, we do not think we have an expense issue in AmeriGas. We knew that those expenses would show up, that there were not shock in terms of where we are compared to our own expectations. In fact we're in line with our expectations and where we thought we would be on that and I think the issue is really one of the volume hasn't been commensurate with our expectations given the weather patterns and given the warmer weather that we experienced compared to normal. And the obvious heightened watching of potential conservation out there because of the cost of the product.

It looks like your margins held up pretty well in the quarter. It looked to me like you were making profit margin of about $0.76 a gallon versus $0.70 the year before. Is that a good number?

Yes, that would be directionally correct, margins were up along that line. Clearly less than 10% but kind of in the 7% range and maybe margins were up and there's a variety of factors that contribute to that increase, but -- and obviously some good work by our folks out in the field.

Are you experiencing the same thing in January?

We haven't seen -- typically in this industry, it would be really unusual to see folks cutting prices in an environment where weather has been warm and we haven't seen that kind of unusual activity.

Okay. So margins --

We we aren't concerned about where our margins are.

Also the units, could you give me a feel for the units outstanding after the performance unit contingency awards.

That was modest. You're looking at under 100,000 units there.

Okay.

Way under 100,000. I'm getting the thumbs down sign. So it must be like 20 -- 20 to 25,000 units, so for taxes and things.

That's not really meaningful.

No. Absolutely.

Are you feeling any significant effect from what is going on in the housing market right now? I know you briefly commented on it, but is that a growing problem for your customer base?

Ron, it's an issue we saw last year to some degree. And we we see it this year. It's mostly affecting the rate of growth in the base business.

It's not bad debt expense?

Bad debt has not been a problem. In fact our over 60 was better than it was last year at this time. This is the time of year when you're going to pay you're fuel bill. So no issues there.

Okay. And I know you said you would not give out any guidance, but is your 300 to 310 million in EBITDA still looking decent.

If I answered that, I would be giving guidance. I always thought that -- I'm not confirming or denying what you said, but I thought by saying I wasn't changing guidance, that that was okay, but then the lawyers told me if you're not changing guidance, that's effectively reiterating guidance and so I have to say, as I said there, that we're not going to comment on guidance until we get through the next quarter.

Okay. And one last question. What is your weather experience been in January in AmeriGas? From a degree standpoint.

It's been somewhat warmer than normal but not egregiously so. And can I answer it differently for you. I think our volume of expectations for January are in line. And actual volume is in line with our expectations give or take a drop but it's in line with where we thought volume would be, which is a good sign for us given what we think weather has been and what happened earlier.

Okay. Thank you.

Okay.

Before I take the next question, I would like to give everyone the opportunity. To hit star one to ask a question or offer up a comment. And next we'll take a question from Faisel Khan from Citigroup

Good afternoon. At energy services, can you elaborate a little bit more, I heard in your prepared remarks, you said higher power prices and peaking demand but if you could elaborate on why that business performed so well in comparison to last year and previous quarters too.

And before I answer one of yours, one of our folks here carry more information. Degree days are 4.5% warmer, 4.5% warmer than normal but about 8% colder than last year for AmeriGas. On Energy Services, John, do you want to take a shot at this

A couple of things, we have increased capacity available and that's a combination of things. I mentioned the two new projects coming on stream and that's helped us in terms of commitments we've made for the heating season but also on an ongoing basis which are the existing propane air plants and airline plants do engineer projects to increase throughput and reliability so the combined effect of that is giving us increased capacity through those engineering projects and the new investments so we probably added between 20 and 25% of additional capacity in terms of our peaking business. And in terms of what is going on in the market, the energy market, the value of that service in terms of the rates we're able to charge for that peeking service has increased and that's just because I think at attractivness of the service, utilities being able to call on that service, with very short notice, kind of taking advantage of the operational expertise we have and positional advantage we have with those assets sitting within the mid Atlantic region have enable us to get very attractive contract rates for those services which that's combined effect of improved contract charges and increased total capacity available within our peaking portfolio.

Well what is the deliverability of that peaking portfolio? Or peak deliver ability?

It's about 110, 120.

Okay. 120 a day.

Yes. And on the electric side, just to hit that issue, as we said many times, we had hedge out a portion of our electric generation and on the order of 50% of it is hedged out and so we dampen volatility to spot prices but spot price have been kind compared to last year and so some of the electric generation improvement is in spot prices and then the capacity auctions in PJM have produced higher numbers and we have a small amount of generation. But it does for us become noticeable in the scale of our electric business.

With some of this new Cohen pricing coming out, that should give you further up lift in the future?

Yes. That's unclear to me a little bit how that will affect us because it's a market bid and you would think they would have achieved the same result had they not changed that com pricing but it's still a good development but again that will only affect capacity auctions in the 10, 11 time frame to begin with. And then 11, 12 and next year and the year after, they've already had those capacity auctions and capacity price have gone up considerably.

Can I ask how much generation you're bidding into PJM.

About 150 megawatts. About 130 is base and we have a piece in [Conanma] and we have a small coal plant that we cycle up and down, not all of the way down, but nominally 50 on the high side and 30 on the low side depending on time of day and prices.

Your comments about possibly looking at generation assets to plug into your portfolio of assets -- given your free cash flow at at end of the year, would that be in PJM.

Yes that would be east side of PJM.

Fair enough. Does the sustainability of this profit levels you've seen in Energy Services -- I'm sorry, the earning levels we've seen this last quarter from Energy Services could be sustainable in the future, is that fair to say.

Yes I think given the market dynamics and how we see that market evolving, absolutely. There will be some volatility marginal electric prices for the part four generation but on the Energy Services side itself, it looks sustainable with improvement as we add assets and improve the efficiency of plants and bring them on full.

And we're having good experience in terms of the retention of customers in the gas marketing side and continued strong margins as well.

The up lift wasn't just a result of maybe wire store deferential, these are real assets that you got ramped up.

That's exactly right. We invested in two propane air plants last year and they came on line and we were able to sell a good part of their capacity this year at decent rates and as you know there is a great need for that peaking because it's so much cheaper than pipeline capacity.

Right. On the propane side of the equation, looking at AmeriGas and Antragaz what was the volume metric impact to your AmeriGas volumes from weather, compared to normal?

It's hard to say that exactly exactly.

I know you give heating degree differences.

Yes, we've gotten about -- I know the temperatures were about 7 -- 7 and change warmer than normal. And if you had normal weather, you would see --

About of half of that.

About half of that affecting, so that would be about three. Say 3 to 4% improvement in volume.

Got you. And then in ant Antargaz.

It probably would go somewhat the other way. There are some dynamics going on with Antargaz that were a little bit different. The company is doing an outstanding job in what was a declining market, the cylinder market. Innovation and new products and they are gaining some market share in the cylinder side of the business as opposed to following a declining market down in past years and the -- we have an Antargaz probably compared to our competitors, somewhat higher -- a higher level of domestic residential heat than they do and so when weather shows up at all, we seem to get more of a pop than they do at the same time. So there is clearly some effect there but the volumes that we experienced this quarter are like the volumes we experienced in 2005 when the weather was very similar.

Okay. And in terms of your -- the integration of the -- the previously acquired gas utility, is the integration complete with regard to -- the two -- moving our operations from -- I forget the name of the utility you bought now, for some reason it's escaping my head.

It's the PG which is now PNG. It's largely complete. We achieved everything we set out to achieve over the first couple of -- or years of the project. But we're continually looking for opportunities to sort of align our infrastructure and opportunities for increased productivity. So for example we just combined our electric utility head office which was within the PNG service territory with our -- with the P&G head office. But there's continued opportunities for us looking across the combined utilities business for -- to take up some costs and be more efficient and we'll continue to strive to identify those and then deliver them.

Got you. Great. Thanks for the time.

Sure.

And as a final reminder, to ask a question or offer a comment, it is star one. And it does appear we have no further questions.

Okay. I want to thank you all for tuning into our call. I hope you can tell from the tone of the conversation that we feel good about our businesses, where we're headed, executing on our strategies and what lies ahead for us and we look forward to reporting good results to you at the end of our next quarter and we'll probably talk to you at the end of April at that time. So thank you all very much, appreciate your time and attention.

And that does conclude the UGI and AmeriGas partners 2008 conference call and webcast. We thank you for participation and ask that you enjoy the remainder of your day.