環球健康 (UHS) 2014 Q2 法說會逐字稿

Mr. Filton, you may begin your conference.

Thank you. Good morning this is Steve Filton. Alan Miller, our CEO, is also joining us this morning. Welcome to this review of Universal Health Services' results for the second quarter ended June 30, 2014.

During this conference call, Alan and I will be using words such as believes, expects, anticipates, estimates and similar words that represent forecasts, projections and forward-looking statements. For anyone not familiar with the risks and uncertainties inherent in these forward-looking statements, I recommend the careful reading of the section on risk factors and forward-looking statements and risk factors in our Form 10-K for the year ended December 13, 2013, and our Form 10-Q for the quarter ended March 31, 2014.

We'd like to highlight just a couple of developments and business trends before opening the call up to questions. As discussed in our press release last night, the Company recorded net income attributable to UHS per diluted share of $1.51 for the quarter. After adjusting each quarter's reported results for the items disclosed on the supplemental schedule included with last night's earnings release, adjusted net income attributable to UHS increased approximately 30% to $155.6 million, or $1.55 per diluted share during the second quarter of 2014, as compared to $118.9 million, or $1.20 per diluted share during the second quarter of last year.

On a same-facility basis in our Acute division, revenues during the second quarter of 2014 increased 11.5% over last year's comparable quarter. The increase resulted primarily from a 3.6% increase in adjusted admissions to our hospitals owned for more than a year and a 7.7% increase in revenue per adjusted admission. On a same-facility basis, operating margins for our Acute hospitals increased to 19.2% during the second quarter of 2014 from 14.8% during the second quarter of 2013.

On a same-facility basis, net revenues in our Behavioral Health division increased 5.9% during the second quarter of 2014 as compared to the second quarter of 2013. During this year's second quarter as compared to last year's adjusted admissions to our Behavioral Health facilities owned for more than a year increased 4.4% and adjusted patient days increased 1.8%.

Revenue per adjusted patient day rose 2.6% during the second quarter of 2014 over the comparable prior-year quarter. Operating margins for our Behavioral Health hospitals owned for more than a year were 28.6% and 28.7% during the quarters ended June 30, 2014, and 2013 respectively.

Our cash from operating activities was approximately $264 million during the second quarter of 2014 as compared to $212 million in the second quarter of 2013. For the six months ended June 30, 2014, our cash provided by operating activities increased approximately 17% to $458 million over the $391 million generated during the comparable six-month period of 2013.

Our accounts receivable days outstanding decreased to 53 days during the second quarter of 2014 as compared to 57 days during the second quarter of 2013. At June 30, 2014, our ratio of debt to total capitalization decreased to 47% as compared to 54.2% at June 30, 2013. We spent $94 million on capital expenditures during the second quarter of 2014 and $187 million during the first six months.

Based upon the operating trends and financial results experienced during the first six months of 2014, we are increasing our estimated range of adjusted net income attributable to UHS for the year ended December 31, 2014, to $5.55 to $5.85 per diluted share. This revised guidance, which excludes the expected electronic health records impact for the year as well as the impact of the other item reflected on the supplemental schedule for the six months ended June 30, 2014, represents an increase of approximately 15% to 16% from the previously provided range of $4.80 to $5.10 per diluted share.

This guidance range, which is subject to certain conditions including those set forth in last night's earnings release, also excludes the impact of future items if applicable that are nonrecurring or non-operational in nature including items such as, but not limited to, gains on sales of assets and businesses, costs related to extinguishment of debt, reserves for settlements, legal judgments and lawsuits, impairments of long-lived assets, impact of share repurchases and other material amounts that may be reflected in our financial statements that relate to prior periods.

Our Board of Directors has authorized a stock repurchase program whereby from time to time as conditions allow, we may spend up to $400 million to purchase shares of our class B common stock on the open market or in negotiated private transactions. And they have also increased our third-quarter dividend payable in September from $0.05 a share to $0.10 a share.

Alan and I will be pleased to answer your questions at this time. We would ask that you try and limit yourself to one question each. Thank you very much.

(Operator Instructions)

Justin Lake.

Thanks, good morning. My question would be on the Acute Care side, obviously great quarter you guys had there. Anything you could share with us in terms of breaking out the out performance in terms of what you think was ACA related in terms of coverage expansion benefits versus core improvements, whether economic driven or just business investments you made. And then maybe you can talk to the specific markets, that'd be really helpful. Thanks.

Sure. We'll try and do that, Justin. So I think as it was the case in the first quarter, I think we believe maybe a little bit more so than our peers, that there's a fair amount of imprecision in trying to parse out or tease out the ACA impact and the impact of the payer mix improvement coming from other sources, particularly the improvement in our underlining economies.

I think our best effort would be that in the quarter, if you look at the Acute Care year-over-year improvement, we would attribute somewhere between a third and a half of that improvement to the favorable ACA impact. And the remainder of that improvement to improving economies in our local markets as well as idiosyncratic factors in our markets. And by that I mean the market share shifts, new service lines, et cetera.

As far as the geography of it, I think we had relatively strong performance across the Acute Care portfolio. But as we said in Q1, I think that the pleasant surprise of 2014 has really been the performance of our Texas markets. Texas not being a Medicaid expansion state and not being one that it set up statewide commercial exchanges. We were not necessarily anticipating a big ACA impact in that state, but generally I think the economy in Texas has improved fairly markedly and that's being reflected in our results. And our California markets as well, have been very strong.

Thanks for all the color.

A.J. Rice.

Thanks. Hi, everybody, and also congratulations on the beat there. Maybe to flesh out further on the reform benefit, I know on the guidance, you I think had said reform was $0.15 to $0.20 of embedded in the original guidance. Have you updated that number? And then specific, seemed like first quarter most of the benefit was Medicaid related. Can you comment if that's still the case and are you seeing any benefit from exchanges start to kick in at this point?

Sure A.J. I think that in terms of the latter part of the question, you've described it accurately. The ACA impact in Q1 was definitely more skewed to increases in Medicaid enrollment. And clearly in Q2, we're seeing more of a commercial exchange impact, not surprisingly since I think that the government's data showed a lot of that exchange enrollment activity was taking place at the end of Q1. And so I think it's starting to filter its way through our business in Q2.

As far as the ACA impact on our guidance, I would answer that in much the same way I answered Justin's question. That is, I think if you take a look at our revised guidance and you think about that as improved over the prior year, I think we would suggest that somewhere between one third and one half of that improvement is from the ACA and the rest is from other non-ACA factors.

Okay. All right. Thanks a lot.

Joshua Raskin.

Hi, thanks, good morning, Steve. First question, and I don't want to beat the dead horse, but can you actually tell if it's exchanged lives relative to general commercial improvement? Or are you seeing it's better in California, so that's why we think it's exchange as opposed to economy or something like that? Is there a way for you to actually know that?

So I think the way that we've approached it Josh, is to -- the way that we've approached quantifying the ACA impact is to say that in Medicaid expansion states we're going to attribute any benefit from increased Medicaid enrollment to the ACA and not do that in the non expansion states.

And as far as then the commercial exchange patients go, to the best of our ability, we are trying to identify those patient specifically. But I think that's really where I think we believe the imprecision comes in. That in some cases we can clearly do that and are very comfortable doing that.

In other cases, it is not so clear. Somebody comes in with a Blue Cross card or an Emit card and it is not absolutely clear to us that they're -- whether they're an exchange patient are not. So that's why we have this range and our feel that to some degree we're estimating that impact.

Got you. And then quickly on the buybacks, do you guys have a formulaic approach, a debt to cap minimum that you hit and then you start buying back or are you going to be just more opportunistic based on what the stock price does?

I think the history of UHS is that we have been an active acquirer of our shares from time to time over the years and have generally been an opportunistic acquirer when we've been active. I think that the message in the buyback authorization from my perspective is obviously a bullish message on the business. We're very pleased with how the business is going and its outlook for the near and intermediate term for sure.

But also as we I think talked about in our Q1 call, we have been very diligently paying down debt and reducing our leverage, really ever since the PSI deal more than three years ago. And I think we certainly feel that our leverage levels now are at a sufficiently low level that we're very comfortable with them and don't feel that they need to be a great deal lower. So that if we continue to generate cash at these levels and don't necessarily find other opportunities to deploy capital in the short term, we'll be more than happy to be acquirers of our own shares. And again, we'll do that on an opportunistic basis.

Okay, thank you.

Kevin Fischbeck.

So last quarter you gave some specific information around the reduction in uninsured as far as, I think, last quarter you saw a 7%, 8% reduction in actual admissions in the quarter. You talked about length of stay and patient days. Do you have the updated data for this quarter?

Yes, so I think -- and again, I think that the result in Q2 suggests this, and the underlying metrics I think support it. The trends that we saw in Q1 probably accelerated some into Q2, so the reduction in self-pay or on compensated patients grew to probably 10%, 11%, 12%. Medicaid utilization increased by 9% or 10%.

And commercial utilization increased probably 4% or 5%. I think all of those numbers were a little more favorable than they were in the first quarter, again reflective of a trend that we didn't see a lot of new trends in Q2 but an acceleration of the ones that we did see in Q1.

Okay, that makes sense. And one last question on Vegas. The minority interest number actually was down year over year, which was a bit surprising to me. I wasn't sure if there was anything in there around the liability accrual that maybe you used to comp year over year, or was Vegas actually a somewhat difficult quarter?

Yes, Vegas was ahead of last year's quarter, but I will remind people that the second quarter of last year was the first quarter where we called out a really measurable improvement in the Vegas economy and in our results. So the Vegas market for us was really the only difficult comparison in Q2 to last year. And that's reflective in the fact that, at least certainly cosmetically, our Texas markets, our California markets were outperforming.

It's also worth noting, depending on what numbers you're looking at, but on that minority interest line, we had a favorable malpractice adjustment in the second quarter of 2013 and to the degree that that was allocated to the Vegas facilities, it made their second-quarter 2013 results look somewhat better, and so that's making the comparison again on the face of the income statement a little more difficult.

Okay, great. Thanks.

Darren Lehrich.

Thanks, good morning, everybody, and Alan congratulations on 35 years.

Thank you. Thanks very much.

I wanted to ask about Behavioral, and I know I've been asking this question pretty consistently Steve, about length of stay in Behavioral. It was down same-store around 2.5%. I'd be curious to get any feedback you're getting from the operators about whether you're sensing there's any bottoming at all there. And then the other Behavioral question I'd like to sneak in here is are you getting any feedback at all about health plan design now that July 1 has come around, and I guess the benefit years post July 1 have to take into account the Mental Health Parity? Thanks.

Sure. So answering your second question first, Darren, as far as benefit plan design, and then I think your question is are we getting a sense that benefit plan design is changing in July to comply with the final Mental Health Parity regulations which become effective in July? I would make two comments about that. One, is from a practical perspective, I think our sense if that the majority of those changes will likely take place in January of 2015 when benefit plan design routinely changes anyway for the most part. We'll certainly press to the degree that we can for earlier changes. But again, I think from a practical perspective, and I think it is part of the reason why we have always tried to create the expectation that the ACA / mental health parity act impact for the Behavioral business would be more either back loaded in 2014 or probably even skewed two 2015.

As far as the length of stay issue -- and the one other comment I'll make about benefit plan design, is I think the managed care companies are always going to be ahead of the curve from us in terms of understanding how that's changing. We'll see those change as those patients really start coming to our hospitals and we get a quarter or two's experience under our belt. So we'll see, so I think it's probably too early us for us to really answer that question in a meaningful way.

As far as length of stay goes, you suggest you've been asking this question for a long time, obviously we've been answering it for a while as well. This trend has existed now and been in place for several years, really, I think, since the height of the recession when Medicaid programs really started cutting back length of stay as a means of controlling expenditures. We saw a little bit of improvement in Q1, Q2 another step down, although not a real significant one. I think very much consistent with our expectations. I would just say that in general the Behavioral division was right on our expectations for Q2. And as a financial person, impresses me quarter after quarter with their very strong consistent performance.

And Steve just so we're clear, the Behavioral margins year over year, would they have been positive if the Garden City reserve wasn't in the numbers?

There's a few small pluses and minuses, Darren, and I think you could -- I could certainly make an argument that we were 1/10 of a point or 2/10 of a point ahead. But again I think what you're seeing in Behavioral from my perspective, is again, there's very consistent margin performance in the high 20s. And to me the real upside to that is really getting back to your original question, if the length of stay does, not even improve but just level off at some point, and/or we do get some of the impact from either the ACA or the Mental Health Parity final regulations, I think that's when you might see the next step up in those Behavioral margins.

Great. Okay, thank you.

Frank Morgan.

Good morning. I was hoping you could comment a the little bit more detail around the surgical volume both inpatient and outpatient. And I'm curious if you're starting to see any kind of change in the mix, of the payer mix of that business suggesting that maybe you're starting to see some of this newly insured business in that area?

Yes, Frank, so the metrics are easy to talk about. I think we had a 4% increase in our outpatient surgeries and a 2% increase in our inpatient surgeries. And I think in both cases those numbers are really the best surgical volumes that we've posted probably since the recession began. So that's encouraging.

Again, looping back to the conversation I was having with Josh Raskin earlier, it's a little difficult for us to parse that out between how much of that increases is reform-related or ACA-related and how much is not. I think our general sense is that most of that surgical strength comes from the improving economies, people going back to work, people feeling more comfortable about being out of work, those kinds of things then it does from necessarily ACA patients, new ACA patients having those procedures. But to be fair, we can't tell that with great precision.

Okay, and changing gears. On cash collection, are you actually starting to see cash collections on those newly insured Medicaid patients that were coming in the door the last quarter. Has that process been fairly seamless and have you noticed any kind of change there.

And then finally and I'll hop, what is the -- this is a mechanical question. What is the run -- the EPS for the first half of the year that you're using to update your annual guidance? What is the number you're actually using to build off of to get to your new full-year guidance? Thanks.

Yes, so I would refer people to the supplemental schedule in our press release where we adjust for the electronic health record number and the nonrecurring gain we had in the first quarter. And that'll show you affectively the adjusted earnings that we're using to then say, this is what we're basing our revised guidance on. And--

Cash collections on the newly insured --

Yes, so the cash collections and I think our DSOs reflect this Frank. I think there was a little slow down in Q1 in some of the states like Nevada where I think they were frankly overwhelmed with the new Medicaid enrollees. But again as you see from the general cash flow in Q2 and the DSOs, I think for the most part those initial bumps are working themselves out and we're collecting on both the newly enrolled Medicaid patients as well as the commercial exchange -- new commercial exchange patients at a pretty normalized rate.

Thank you.

[Paula Torch].

Good morning, congratulations on a great quarter. I was wondering if you could talk a little bit more broadly about the urban Acute hospital landscape and are you seeing some better opportunities for any M&A activity there? Are there any assets you've identified or any particular markets that you're really focused in on? And when might we start to see some activity there at all, and what might some of the challenges be in getting anything done in the next couple of years? Thank you.

Sure, Paula.

So UHS has generally been situated in the middle of the continuum that you are suggesting of rural and urban. And our sweet spot, particularly in our Acute Care division has been the midsize urban, large suburban markets, where we have tended to try and locate. I think we have a sense and -- that not for profit hospitals around the country in those kinds of markets are having all sorts of conversations and evaluating their future and thinking about how they want to position themselves in the healthcare landscape of the next three years and five years, et cetera.

But I will also say that those conversations historically I think a long time to evolve and mature. We're trying to stay on top of them as much as we can. And as those hospitals decide that they want to look in a different direction or want to consider other alternatives, we certainly have, as we were alluding to before, the capital flexibility and the desire to respond to those opportunities as they arise.

Okay, great. And I have one follow up as we think about guidance. In terms of the same-facility revenue, let's take it on the Acute Care side, you had guided to 3% to 4% with EBITDA flat to slightly up, obviously we're trending much better than that. So where should we be thinking about taking that number in terms of how we're modeling the second half?

I'll answer the question just a little differently, Paula, in the sense that I think what we try to do in revising our guidance was to take our first half of the year performance and for the most part assume that that improvement over our -- over the prior year and over our original expectations continues at about the same rate as it did for the first six months. We obviously then adjusted for a couple of the known pluses and minuses like the Texas Medicaid reimbursement that we disclosed, et cetera. But other than that it was really pretty much as straightforward as that. And I think if you go through that same exercise, you'll land very much within the confines of our range.

Okay, great. Thanks and good luck.

Chris Rigg.

Thanks for taking my question. Wanted to try to parse out the economic versus ACA improvement a little bit more. I know you talked about Texas being very strong, but when you think about the relative benchmarks, the surgery, inpatient, outpatient surgeries, is the -- are there major regional differences say in Texas versus California and Florida et cetera, that might be worth highlighting? Thanks.

Sure, Chris. Generally, I think that obviously when you talk about a 4% increase in outpatient surgery, you're going to see some hospitals doing a little better in that and others a little worse. But in general, the trends that we've discussed, the improved payer mix trends, the stronger surgical mix trends, really have been pretty much spread fairly evenly through the portfolio.

As I said, I think -- as I think about 2014 in terms of how we originally envisioned it and how it's played out, I think that our original thought was this would be a year in which we'd feel, as we described, a significant ACA impact in places like California and Nevada which were Medicaid expansion states. In California, which had a robust commercial exchange program, et cetera. But what's surprised us I think was the really strong performance in Texas that I think for the most part is not ACA related. And even the really strong performance in California that I think is beyond the ACA impact.

So that's the geographic trends or differences that I would point out, but I will say that for the most part the trends that we described are trends that we're really seeing across all of our markets. And my sense is, obviously, given the couple of other Acute Care companies that have reported so far this quarter, at least given an indication of where they're going to report, that those trends seem to be fairly widespread.

Okay, and then one quick follow up. Are you still excluding the California provider tax from the guidance? And I will leave at that, thanks.

And the answer is yes, we are still excluding the California provider tax.

Great. Thank you.

Ralph Giacobbe.

Thanks good morning. Steve, I was hoping you could maybe talk about the progression through the quarter. Was it evenly spread, did it improve month to month? And I know it's only a few weeks in but any initial views on July trends?

So I think as some of the sell side surveys have indicated, I think the quarterly both payer mix and volumes tended to improve as the quarter progressed. I think it's difficult to really give much of an indication of any early signs of the third quarter, only because so much of this improvement is really payer mix based and that's much harder for us to measure on an interim basis before the month closes. So I don't think there's really anything we can say that's terribly meaningful about the third quarter just yet.

Okay, fair enough. And if I could take one more in, are you guys seeing any greater mix of out-of-network revenue coming in? Is that helping at all? And within your markets, remind us of what your position is of being in versus being out. Thanks.

I think in the vast majority of our markets, we are in almost all the networks except for, I think, some long standing historical exclusions. I don't think that there's been any developments in recent -- in the last year or two where we've really been excluded from a noteworthy contract. And again, occasionally you'll see a significant amount of out-of-network activity or outlier activity. But I would say in general, that's not something that has really come to our attention in the last -- in this year at least.

Okay, thanks.

Brian Zimmerman.

Thanks and good morning. I appreciate the color around surgical trends, but I was hoping you could also give us an idea of what acuity looked like in the quarter, and then maybe some of the other service lines in terms of ER visits in particular?

I think, Brian, the revenue strength, meaning that revenue per admission number, which quite frankly I didn't go back and try and find the last time we were that high, but I know it's certainly been multiple years. But I think that is reflective of, obviously, the improved payer mix that we've been talking about, but also increased acuity.

I think the increased acuity occurs for a couple of reasons. One, it's a function of the improving surgical volumes that we've talked about already. Two, is this whole two midnight phenomenon that as payers, most notably Medicare, but other payers, drive out the shortest lengths of stay. And by definition therefore I think the least acute patients.

The in-patient component that you're left with tends to be a more acute mix of patients, et cetera. So I think that also drives the acuity up. But in general, I think acuity has been strong this year and we would expect it to remain so.

And on the ER visits?

ER visits had been up, I think 5% or 6% for the year. Although again going back to the two midnight phenomenon, the conversion of those to actual inpatient admissions is going at a lower rate than has been the historical case, I think because of the emphasis on making sure that patients meet admitting criteria that will pass muster with Medicare and other payers.

All right. Thanks a lot.

Gary Lieberman.

Thanks for taking the question. Maybe a follow up on the last point, Steve. Do you happen to have the statistic for the percentage of admissions that came in through the ER and how that would compare year over year?

I don't have it in front of me, Gary. I will tell you that historically we run in the mid to upper teens, low 16%, 17%. But I know that again, over the last two or three quarters that percentage has declined some although again I do not have the data right in front of me.

Okay. And then could you comment on any impact, if at all, that you're seeing or you're aware of in South Texas from some of the immigration issues that have been in the news?

Yes, I think we've seen very little. As I watch the news along with everybody else, I think that these folks, particularly the children who are coming across the border, are generally being treated in these separate facilities. I have not really heard other than the anecdotal story here or there that we're really seeing any of those patients.

Okay. And then maybe to wrap up on the Behavioral side, are you still on track to add, I think you said it was 600, beds for the year, or are you considering changing that, based on some of the volumes that you're seeing there?

No, I think that those bed additions that we've undertaken are generally decided upon based on a fairly long-term view. And I don't think our long-term view of this business or the demand has really changed. So we're sticking with our expansion program, not only for this year quite frankly, but I think we hope to continue the bed expansions at about that same annual rate for at least 2015, and hopefully into 2016, as well.

Great. Thanks a lot.

Whit Mayo.

Hey, thanks. Steve you've excluded high-tech income and the cost from your guidance for some time now and clearly that's had the impact of understating your earnings in prior quarters. But how do you think about that over the long term and presumably that the cost will continue into perpetuity and the reimbursement doesn't. So, I'm curious on your thoughts there.

Well, I think our rationale for excluding them was just the opposite, that the actual implementation of the electronic health record, and those are really the costs that we've excluded, really doesn't continue into perpetuity, that that was a finite process that began in 2009 or so and continued for four or -- will continue for four or five years.

I think from a cash perspective, we will largely be through a lot of that impact at the end of 2014, certainly from a cost perspective. And I think again our rationale for excluding both the high-tech revenue and those costs was they weren't being recorded on very ratable basis in many cases and therefore in our minds were distorting the current earnings power of the Company. So again as you know, we've been very transparent about what those numbers are. We tended to exclude them from our ongoing earnings in that supplemental schedule we do. But the costs are out there so that any analyst can treat them exactly the way they want.

I was just curious. And maybe on cost for a second, anything new on either side of the business? I think you and others within the sector have really worked down your cost structure for years now and that presumably helps on any new incremental dollar of revenue that flows through. But anything new or worse on supplies, registry costs, anything that we should be aware of? Thanks.

I don't think so. Look I think what you've actually described it pretty accurately, I think UHS and the industry in general really tightened their belt as the recession began several years ago. And I'm not sure they've -- that we or they have loosened that at all or much at all.

And I will say that because so much of this revenue strength is coming from improved payer mix, there's not necessarily costs that are directly associated with improved payer mix. And that's why I think you're seeing such a powerful leverage mechanic on that Acute Care margin line.

To the degree that we are seeing volumes pick up as we did in Q2, obviously there is some increase in costs associated with that. And obviously also to the degree that we're seeing surgical volumes pick up, I think our supply expense does tick up commensurate with that. But other than that, I don't think we really feel like there's any significant pressure points on cost at the moment.

Thanks.

(Operator Instructions)

Gary Taylor.

Hey, good morning. Actually I just had one clarification and one question, so see if I can get away with that. Steve, you might have said this, I stepped out for just a second. But on the Medicaid supplemental payments and the portion of those that are out of period, are those included in the same-store metrics that you report, or excluded?

Yes, so I think it's only the in period revenues that are included in the same-store metrics.

Okay, so it's all been scrubbed already for that?

Right.

Okay, perfect. And then my question, it' interesting obviously really strong fundamental performance has overshadowed everything else. But just a few days ago, the biggest thing going on in space was some of the legal decisions coming out of the court cases and consuming a lot of people's thoughts. And you are fairly well positioned, Nevada, California.

My question would be, and maybe Alan might want to weigh on this as well, you do have significant exposure to Texas. There is some ACA benefit there, presumably with 700,000 or 800,000 exchange enrollees in that state. And guess the question is, any sense out of the hospital associates and yourselves, the willingness of the State of Texas to actually establish their own exchange if it ever actually got to that after some additional legal decisions? Or does it still look quite your best guess would be that Texas would be a standout and probably wouldn't want to move along those lines? Interested in your opinion.

Thanks.

We haven't heard anything with regard to Texas changing its position at the moment. I think the governor's positioning himself to run for President with the border business and his position, so we'll see. But I think that's a plus. What we've been able to accomplish without Texas, without Texas and exchanges, I think that's a plus. I would expect at some point that this whole thing will be resolved and it'll be favorable to us.

Okay. Thank you.

And there are no further questions at this time. Are there any closing remarks?

A.J.? Is A.J. still with us?

He can't answer.

(Operator Instructions)

It's okay. Thank you. We want to thank everybody for their time.

And this concludes today's conference call. You may now disconnect.