Yellow Corp (YELL) 2014 Q2 法說會逐字稿

Good afternoon. My name is Pete, and I'll be your conference operator today. At this time, I'd like to welcome everyone to the YRCW second-quarter earnings call. All lines will be placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. (Operator Instructions) Thank you.

Stephanie Fisher, Vice President and Controller of YRC Worldwide, you may begin your conference call.

Thank you, Pete, and good afternoon.

Thank you for joining us for the YRC Worldwide second-quarter 2014 earnings call. James Welch, Chief Executive Officer of YRC Worldwide, Jamie Pierson, CFO of YRC Worldwide, and Darren Hawkins, President of YRC Freight, will provide comments this afternoon. James, Jamie and Darren will be available to answer questions following our comments.

Now, for our disclaimers. During this call, we may make some forward-looking statements within the meaning of federal securities law. These forward-looking statements and all other statements that might be made on this call which are not historical facts are subject to uncertainty and a number of risks, and thus, actual results may differ materially. This includes statements regarding the Company's expectations, assumptions of future events and intentions or strategies regarding the future.

The format of this call does not allow us to fully discuss all of these risk factors. For a full discussion of the risk factors that could cause the results to differ, please refer to this afternoon's earnings release and our most recent SEC filings, including our Forms 10-K and 10-Q.

Additionally, please see today's release for a reconciliation of operating income and loss to adjusted EBITDA and the reconciliation of adjusted EBITDA to net cash flow from operating activities and adjusted free cash flow deficit. During this call, we may refer to the non-GAAP measure of adjusted EBITDA simply as EBITDA.

I'll now turn the call over to James to provide comments on our second-quarter results.

Thanks, Stephanie. I will make just a few comments and then turn the call over to Jamie for his financial update. We also have with us today Darren Hawkins on the call, and he will be here to discuss YRC Freight's performance and priorities, since they are such a key piece of YRCW.

Our second-quarter results reflect progress from the disruptions we experienced in the first quarter during MOU negotiations, refinance activities and severe winter storms. The most encouraging element of our second-quarter results was the renewed confidence our customers showed in YRC Freight, Holland, Reddaway and New Penn by rewarding us with shipment, tonnage and revenue growth at each operating company.

There's no doubt the overall freight environment was strong as well during the second quarter as capacity tightened. We know we lost pricing momentum during late 2013 and early 2014, so it is encouraging to see the improvement that we've made as the year has progressed, including the second quarter. And more importantly, pricing improvements have continued in July as well. On a year-over-year basis, we also know that we've trailed the industry, but sequentially, we are right in the pack, as our customer negotiated increases are as strong as I've seen in several years.

Overall, I'm relatively satisfied with our regional carriers' execution in the second quarter. Holland, [Redden] and New Penn are showing solid results in 2014, although their performance in the second quarter was impacted by higher-than-anticipated short-term revenue equipment rental expenses due to volume increases, and then work comp and BIPD headwinds coming out of the first quarter. Our regional segment has good volume and yield momentum, and I believe that they will have a positive second half of 2014.

At YRC Freight, the operating results were a blend of both positive and negative results. As I stated earlier, it was encouraging to see shipments, tonnage and revenue grow over the same period in 2013. Another favorable sign for YRC Freight was that after three quarters of year-over-year declines, it was able to increase yield and revenue per shipment.

However, in order to keep the network fluid, purchased transportation was utilized more than planned and at higher cost levels than we expected. YRC Freight also had a significant increase in BIPD and cargo claims expense as compared to the second quarter of 2013. Dan will provide more color on the priorities he has put in motion to drive and improve results at YRC Freight.

On a consolidated basis, the increase in BIPD and cargo claims expense obviously negatively impacted our bottom line. While we have not backed off on our efforts to be the safest carrier on the road, we nevertheless incurred negative development, mostly from prior-year claims.

Our EBITDA results of $63 million and operating income of $20 million were less than planned, but based on our current trends, the second half of 2014 should produce improved results. The freight environment we're currently operating in and the capacity issues that are showing up within the industry are creating some challenges as well as opportunities for carriers.

At YRCW, we think there is an opportunity to show pricing strength at all four of our operating companies, which, in turn, should help drive improved profitability. I can assure you that we are not standing still. Our operating company presidents have a firm grip on what needs to occur at their respective companies, and I have a lot of confidence in their abilities, and I believe our results will reflect our hard work in the second half of 2014 and beyond.

With that, I'll turn the call over to Jamie for his comments.

Thanks, James, and good afternoon, everyone. For the second quarter of 2014, we reported consolidated adjusted EBITDA of $63 million, which is a decrease from the $74.1 million we reported in Q2 2013. The decrease is primarily attributable to the YRC Freight network not being fully in cycle, which resulted in decreased productivities, rehandling of freight and less-than-optimal use of purchased transportation.

Additionally, we experienced a $15.5 million year-over-year increase in expense related to BIPD and cargo claims. The increase in BIPD expense was driven by an increase in the number of outstanding claims as well as unfavorable development of prior-year claims. The increase in cargo claims was due to increased frequency and severity.

Now, for the year-over-year second-quarter stats. YRC Freight's tonnage per day was up 5.9%, and regional tonnage per day was up 6.7%. YRC Freight's revenue per shipment was up 1.2%, which included an increase of 0.2% in revenue per hundredweight and an increase in its weight per shipment of 1%. While the regional carriers increased their revenue per shipment by 3.2%, their weight per shipment increased by 0.6%, which in turn caused revenue per hundredweight to increase by 2.5%.

Moving on to earnings, on a consolidated basis YRC Worldwide reported revenue of $1.3 billion for 2Q 2014, and increase of $75 million over Q2 2013 from top-line revenue growth at both YRC Freight and the regional carriers due to tonnage and rate increases previously mentioned.

Additionally, we reported consolidated income of $20 million for Q2 2014, which included a $6.5 million gain on asset disposals and was an increase of $5.7 million when compared to 2Q 2013. Finally, as I stated earlier, we reported adjusted EBITDA for 2Q 2014 of $63 million, versus $74.1 million in 2Q 2013.

On a segment basis, for the second quarter of 2014, YRC Freight reported an operating loss of $300,000 and an improvement of $8.2 million over the prior year, which translates into an operating ratio of 100 and an improvement of 110 basis points versus 2Q 2013.

Further, Freight reported adjusted EBITDA of $21.5 million, an $8.5 million decrease from the second quarter of 2013 primarily due to additional purchased transportation needed to balance the network, lower productivity levels, and unfavorable developments in prior-year BIPD claims.

Our regional segment reported operating income of $23.2 million, a decrease of $2 million over Q2 2013 and an operating ratio of 95.1. Additionally, the segment reported adjusted EBITDA of $42.1 million, which was a slight decrease of $400,000 over the second quarter of 2013 driven by an increase in purchased local cartage and short-term revenue rentals to handle increased shipments, as well as unfavorable development of prior-year BIPD claims.

Turning to cash flows and liquidity, from the end of the first quarter of 2014, our balance sheet cash and ABL availability under our ABL facility increased by approximately $30 million in Q2 2014, from $223 million to $253 million. Additionally, our cash and cash equivalents and amount able to be drawn under our ABL facility increased approximately $26 million, from $183 million to $209 million. Our ability to maintain liquidity at this level is due to continued active management of our balance sheet and working capital and the current seasonality of the business cycle.

In closing, our second-quarter results were not what we wanted them to be, but I'm encouraged with both the volume and the rate increases we are seeing. Moving forward, it's about converting that additional revenue to the bottom line.

Now, I'll turn the call over to Darren to discuss what he's doing at YRC Freight to capture that additional revenue.

Thanks, Jamie. The YRC Freight network provides the LTL marketplace with the longest length of haul in the industry. In the second quarter of this year, each shipment traveled an average of over 1,250 miles in our network. The service cycle, which is how we manage the pace of our network to protect transit times, required a focused investment throughout the quarter to ensure our customers received the reliability they expect.

During the second quarter, the large transfer distribution centers experienced inefficiencies that negatively impacted our productivities, resulting in higher costs and rehandling of shipments. The second-quarter investment in our service and getting the network back in cycle also included utilizing road and rail purchased transportation in lanes that we normally would avoid due to the high cost of those lanes. Quite frankly, we struggled throughout much of the second quarter to keep our network fluid, and this resulted in higher costs than we would have liked.

When I assumed my current role in March of this year, I put in place an organizational structure that places more authority closer to where the work is being done and the revenue is generated than previously existed. Our division vice presidents now have responsibility for both sales and operations, and are the primary owners of the service cycle compliance within our company, with a heavy focus on our large transfer distribution centers.

While we did not perform right out of the gate in the second quarter like I had planned, I still firmly believe the structure we have put in place is the right answer moving forward. As evidence of this, the field organization has made positive strides in the last few weeks from an operational performance standpoint, particularly since the Fourth of July holiday. Our network has stayed in cycle since that time, largely due to the focus on our distribution centers' utilization of part-time employees to handle our freight volumes.

We're not satisfied with just being in cycle on our current business. This economy's given us the opportunity to grow the right revenue quality, which is why we are converting three of our current terminals to distribution centers in August. These conversions will allow us to handle our freight more efficiently and provide more flexibility in the network as our business levels grow. This is in addition to the three new end-of-the-line terminals we opened in the second quarter this year, which are now fully operational. These openings and closings are a normal part of our business as freight volumes expand, contract or change from a flow standpoint.

Driver recruitment efforts remain a priority. We now have a team of in-house recruiters to target our driver needs. We are also operating a company driving school and have a joint driving school venture with the Teamsters Local union in Indianapolis.

Additionally, I think it's important for me to make some specific comments about how we are aggressively approaching pricing increases. First, our scheduled contract rate negotiations in June and July yielded attainments well above historical norms. Second, we are successfully achieving out-of-cycle contractual rate increases for large lower-margin customers. Third, we have targeted specific segments of our business for pricing increases in lanes that are not profitable or are over capacity. And finally, our three PL pricing increases have produced good results.

Customer confidence in YRC Freight is evident, as our contractual rate negotiations are yielding positive percentage attainments. I am pleased with sales, marketing and pricing trajectory of our team. The revenue pipeline remains sturdy, and our gatekeeping effort to improve revenue quality on new business is benefiting our overall mix and targeted lane volume.

We also continue to invest in the areas that will help drive YRC Freight forward. The following are just a few of the investments we made during the second quarter and some additional investments we started for the remainder of 2014.

First, in March, over-the-road purchased transportation started from scratch, with cost levels improving every month since then as we ramp up our ability to utilize this service in the right lanes. Today, we are currently running over 600 PT schedules per week, and this is a significant component of our line haul network.

Secondly, in May, we rolled out a new CRM tool, resulting in customer, sales and revenue management information being linked together. And in July, we launched a redesigned website that, beginning in August, will also include industry-leading, dimension-based Web-quoting functionality with no login required. As of today, we have installed 18 of 40 planned dimensioners at YRC Freight, 13 of which were installed in the second quarter. We are on track to have all 40 installed by the end of the year.

Finally, we are actively exploring in-cab technology that is intended to assist us in avoiding accidents before they happen and reducing our BIPD claims expense.

Our success in the second half of 2014 will not be defined by the trucks, trailers or terminals, but by the 20,000-plus professionals that make up the foundation of our service performance and drive our confidence-delivered brand promise.

I'd like to close with welcoming 89 additional YRC Freight drivers who have surpassed 1 million or more consecutive accident-free miles and joined our Circle of Champions this quarter. This club now has over 2,400 (technical difficulty) drivers in it.

With these comments, we are ready to take your questions.

(Operator Instructions) David Ross, Stifel.

I guess can we talk first about the rate increases? Darren, you mentioned that they're tracking well above historical norms. Could you put any numbers around that in terms of the contract rates you're seeing coming up in July or at the end of the second quarter, what you're getting on the increases?

Hey, David, this is Darren, and, no, I won't put any numbers around it, but I will tell you that we're over 65% complete for the year and our annual numbers are also tracking above with this addition in June and July. So what we're seeing is encouraging, especially with the later start that we got compared to our competition with some of the noise we had in Q4 and Q1 of this year that hampered our efforts somewhat.

And then the length of haul at YRC Freight, you mentioned it's a little over 1,250 miles. Was that a significant change year over year?

It was a 17-mile change.

Higher or lower?

Lower.

Okay. And then when you look at the equipment side of the Company, YRC Freight versus regional, did they have about the same average age of tractor, or do regionals have a younger or older fleet than the Freight division?

Hey, David, it's Jamie. I'd say, on the balance, they're pretty similar across the two segments.

Okay. And then on the equipment side as well, you mentioned some rentals. Obviously, you had some leases coming in for the new equipment, but there were some rentals in the quarter. Can you explain why the need for the rentals? Is that typical?

Hey, Dave, this is James. The short-term rental expense that we incurred was primarily at one of our subsidiaries in the regional segment. So obviously volumes were pretty strong there and that's where we incurred that expense. Obviously, we have our longer-term leases at all four companies, but we got hit with short-term rentals at one particular company.

Was that due to a competitor failure in that region?

Well, it was due to a multitude of factors.

Okay. Excellent. Thank you.

Scott Group, Wolfe Research.

So the big picture here is we're supposed to be in this fantastic LTL environment, and I think three of the five LTLs have missed expectations. And I think the message we're hearing is there's a lot of volume and we're struggling initially to handle the volume. So how quickly do you think that these issues of purchased transportation and renting trucks -- how quickly can you fix that? Is this something that takes a quarter to fix and we should start to see improvement again in the third quarter, or could this take several quarters to cycle through?

Good question, Scott. This is James. I'll make a couple of comments and then let Darren jump in. Certainly, we've made a lot of progress the second quarter with the staying in cycle project that we put into place at YRC Freight last fall. And as the quarter unfolded, we're seeing some nice progress there, and certainly we're running much better this month than we have in the past.

At the regionals, I think the volume has moderated a bit, but primarily that's been because we've taken more severe pricing actions. So it's really kind of hard to get your head around are we seeing some moderation because of the economy or because of the pricing actions that we're taking. But so far we're still running levels that are very satisfactory to us and we're trying to keep that cost and yield equation intact, and we're pretty happy with where we're at with our balance right now.

Darren, I don't know if you want to jump in with any specific comments about YRC Freight.

Yes, absolutely. Hello, Scott. This is Darren. The first thing I'll mention is we did open three terminals in Q2, and also have three additional distribution centers opening in August. So that will certainly provide the valves in our network to continue our consistency around our service cycle as volumes increase.

Second, I would like to talk about purchased transportation for just a minute on the road and rail side. As in Q2, the negative impact that I mentioned in my opening comments really came from utilizing those services in lanes we wouldn't normally choose to use them in. Because of bottlenecks in certain parts of the country, we engaged the rail and road purchased transportation in lanes that are not the most favorable for us.

We were able to stop doing that after the July Fourth weekend and have seen the purchased transportation on the road side start contributing like we planned for it to. And those 600 schedules that I mentioned from the previous week, those are all contributing in lanes that are positive from a cost standpoint, so that's very exciting for us for the third quarter.

So do you think that -- I mean, typically, I think we see third-quarter margins a little bit worse than the second quarter, just seasonally. Do you think that the things that you're implementing can offset that and you can see some margin improvement or EBITDA improvement from 2Q to 3Q?

Hey, Scott, it's Jamie here. Obviously, we don't give guidance, but I'll tell you that coming out of the second quarter, it certainly did not meet our expectations. So I wouldn't look at it so much as sequentially in a historic norm as much as about what we're doing to rectify, as Darren said, kind of our shortcomings in the second quarter and expect the third quarter to be more normal than certainly the second quarter was. But we don't give guidance in terms of margin or dollars.

Okay. And then just a last one for you, Jamie. The leverage covenants get a little bit tougher going forward. Are you comfortable, given the results, that you can meet those, or do you feel like you may need to go back to the banks and redo some things?

You know, one thing, Scott, that I don't think most people are aware of is the internal process that we go through every single month in this company. It's very arduous on the operating companies, but we update our forecast every single month and roll it forward. So as we sit here right now, we do have the cushion that we need to continue to operate the Company, and we evaluate that every single month, every 30 days.

Okay. All right, thank you, guys.

Thanks, Scott.

(Operator Instructions). Rob Salmon, Deutsche Bank.

I guess to follow up with Scott's question, as we're thinking about the costs associated with the network being out of service in Q2, can you give us a sense of the incremental expenses that you guys incurred on the PT as well as some of the line haul costs when we think about the performance this past quarter?

This is James. I'll make a couple comments and let Darren jump in. But there's all kinds of PT. There's cartage PT, there's over-the-road PT, there's rail PT, and there's good PT and there's bad PT. So we won't give any specific numbers on the costs associated with it, but suffice it to say, reflecting back on Darren's earlier comments, we did have some bad PT both in rail and over-the-road in order to keep the network fluid, and we know that that certainly was not positive for our cost situation.

But Darren, I'll let you make any other comments you want to make there.

Hello, Rob. This is Darren. I will throw in -- James covered the PT well. I will throw in that we had a higher trend of hiring in Q2. We brought on 600 part-time dockworkers in Q2, and then I had to train all those and get them up to speed. So there was certainly expense there in my dock bills per hour, which was certainly one of the contributing factors when I mentioned the inefficiencies.

Okay, that's helpful. I guess shifting gears, Jamie, you had called out the IPD and cargo claims as two headwinds. How should we be thinking about those line items as we look out to the back half of the year? Will that elevated expense continue to flow through, or are there opportunities for that to come down in the second half?

Hi, Rob. Difficult to say. The reason I say that is a lot of our expense -- and it's not just YRCW, it's the industry. Expense is calculated on an actuarial basis. And that is to say that they try to estimate what claims that have already been filed are going to cost us in the future, and what the incremental expense for us in the quarter actually had to do with claims that were already filed that developed negatively against us. That is supposed to be trued up every quarter, as it was for us this quarter. So if the actuaries get it right, it should remain flat.

Now, no one can tell the future, especially in terms of the amount of reserves that we have posted against those claims. But as we sit here right now, I wouldn't foresee any substantial headwinds, but we won't know that until the quarter continues to develop and we get some more information back from the actuaries.

Okay. I guess a final one before I shift it over, and I'm not sure if this should go to Jamie or to Darren. When I'm thinking about the service center openings and the new distribution centers that will be coming online, are there any start-up costs that we should be modeling in for the third quarter associated with those?

Rob, this is Darren, and, no, there's no start-up cost.

Okay. Thanks so much for the time.

Thom Albrecht, BB&T.

I wanted to start with regional. I think this is the third quarter in the last four where the OR has actually deteriorated year over year. And I kind of look at regional as still needing some work, but not in the turnaround stages that Freight is and probably more able to take advantage of what Scott said is a really strong LTL market. Why has regional not been able to kind of break beyond the 95-ish type of OR?

Thom, this is James. I'll make a couple comments and let Jamie jump in there as well. But certainly the short-term rental expenses that we've incurred have hurt us on the regional segment. And then BIPD and cargo claims certainly have not been our friend as well. And then I don't think we came out of the MOU refinance timeframe with as much aggression as we should have at the regionals with rate increases. But we certainly have rectified that and have moved forward very good in the second quarter with continued momentum into July.

But those are a couple of my comments. Fundamentally, the companies are running good. Their service product is good. There's a lot of opportunity for improvement as we move forward. But Jamie, I'll throw it over to you for a couple comments.

Okay, Thom. I think James nailed it. It is the short-term rentals when we take on the incremental volume, especially above and beyond what we've forecasted. We are going to continue to enter into operating leases there, so we've talked about the headwinds that that's going to create. But what we're talking about here more on the short term are the day and the week leases that literally cost twice as much as a long-term operating leases.

So the more volume we have and the more short-term leases that we enter into, that's going to actually create a little headwind. And everybody knows, who's on this call, the amount of backlog there is for equipment deliveries. So we do have some orders in. We're waiting to get those, and as soon as we get those in, that short-term rental expense should decrease somewhat.

Now, on the BIPD side, as I was talking about when I was trying to answer Rob's question, that's a quarter-to-quarter adjustment -- again, not expecting that to be a tremendous headwind going forward. So absent the short-term, the day and week leases, and absent the BIPD, I think we would have broken through that 95.

Okay. And then, Darren, I know you expressed a lot of optimism on pricing. And I think you in particular tried to get us to focus on what's happening in June and July. But when I look at just the reported -- and I say reported yields because that doesn't capture all the mix changes -- they're still really modest year over year. And even when I look at them sequentially, the increases are less than 2%. So I mean, what gives you optimism that you're going to be able to get to the point where when we see some reported numbers, we might be looking at 4%, 4.5% types of numbers?

Good evening, Thom. This is Darren, and great question. I know you've been watching LTL and this company for a long time. And my optimism comes from -- the full impact of price aggression certainly takes some time. It gets to a rolling start, and then it certainly gains ground quickly when that happens. And that's exactly what I'm seeing at YRC Freight. And certainly I've been in this industry a long time and watched several highs and lows. And when I mentioned that the increases that we're getting are above the norms, that's above the norms that I've seen for a long period of time.

And I would also say that I'm very encouraged by the amount of revenue we're attaining from those increases, but the business is not being churned out. It's staying with us after those increases, so that gives me confidence. And certainly I've had the view of July, so I'm strong on that segment for YRC Freight.

Thom, this is James. Another thing I'll add to Darren's comments is that as he has put the pressure on the pricing side, our churn has hung in there pretty good. And historically, if you go back over times when there's been a little more price aggression, you might churn out a little more business than normal. But I think Darren's pretty satisfied with what he's seeing on the trend factors, so to me that bodes well for us.

Yes. And so back to Jamie for a minute. When you talked about some of the different reserves, whether it's BIPD or cargo or worker's comp, I think this is the fourth quarter in a row where you've singled out items between the two companies. So how much of what is occurring is relatively recent, inside of a year, versus still some longer-term legacy claims?

It's very volatile, Thom. If you want to talk about BIPD, work comp and cargo, those three individually, you really have to completely separate them. So I wouldn't treat them as a single piece. That's why we actually do call them out individually.

On the BIPD, if you're going to talk about current versus legacy, clearly, this quarter it was legacy claims, things that were not from the quarter, that are one quarter to one year and maybe two years old. BIPD claims do not have the age that work comp claims do, so they don't develop as long. But given the size of those claims, they can certainly have a greater magnitude impact on the Company.

Work comp wasn't as much of a factor this quarter as it has been in the last quarter or two. So the safety in terms of hours between injuries and miles between accidents I wouldn't say is meaningfully different this quarter. It's certainly kind of plateaued, and I think that has more to do coming out of the noise that we had in the fourth quarter going into the MOU negotiations. And the first quarter certainly had the -- basically the field [vote] plus then the revote created some noise, and then the weather. So there is certainly some negative direction there in the first quarter. The second quarter is not as bad as I think most people would think.

And then on the cargo claims, a significant piece of that exposure or the increase this quarter had to do with the spike in volume and the rehandling of that freight as our network got out of cycle.

Okay. Where do you stand, maybe Darren, on the target of getting to 6% of your miles being handled by outsourced parties? You mentioned the 600 PT schedules right now, but as a percentage of miles, approximately where are you?

Thom, this is Darren, and what you're referring to there is the road portion of our purchased transportation agreement from our recently approved MOU. And we are tracking right at that number, so we're doing very well on the execution side.

And do you have, Jamie or Stephanie, any preliminary estimate on what we might expect for gains or losses on disposals here in the third quarter?

We don't, Thom, but I don't expect them to be material or significant.

Okay. Okay, I'll jump back in the queue. Thank you.

Thanks, Thom.

Thanks, Thom.

David Ross, Stifel.

I just wanted to get back on the BIPD front. Cargo claims -- I understand that, bringing new dockworkers on, a lot of volume, you damaged some freight. But was there anything really behind the accidents in the quarter? Not talking about the development of prior-period claims. Was the aging equipment a factor? Was it driver training that's insufficient, that might need to be tweaked again? Any comments there?

Hey, David, it's Jamie. Aging equipment had absolutely nothing to do with it whatsoever, especially if you want to talk about the second quarter as a standalone. The number of new BI claims wasn't that high, if at all, out of the last probably, I don't know, two or three quarters, except for the first quarter of 2014. I've already talked about the spike in the claims in the first quarter due to the weather. So if you go back on a more normalized weather quarter, the two quarters before that, it's not that much higher, if at all. So I don't consider the second quarter to be that high. Again, it's the development of the claims that were filed prior to this quarter, and the equipment had nothing to do with that.

Excellent. Thanks.

There are no further questions at this time. I'll turn the call back over to the presenters.

This is James. Before we close the call, I just want to personally congratulate the 29 YRC Freight, Holland, Reddaway, New Penn state truck driving championship champions, who are headed for Pittsburgh for the National Truck Driving Championships next month. So certainly we wish those folks a lot of luck and we'll be there to support them, and we're confident they'll represent our company well.

That concludes our call today. Thanks to everyone for joining us. If you have any questions or follow up that you want to discuss, please contact Stephanie. And Operator, I'll turn the call back over to you.

This concludes today's conference call. You may now disconnect.