Ziff Davis Inc (ZD) 2013 Q1 法說會逐字稿

Good afternoon, ladies and gentlemen, and welcome to the j2 Global first quarter earnings conference call.

It is now my pleasure to introduce your host, Mr. Scott Turicchi, President of j2 Global Communications.

Thank you, Mr. Turicchi.

You may now begin.

Thank you.

Good afternoon and welcome to the j2 Global investor conference call for the first quarter of fiscal year 2013.

As the operator just mentioned, I'm Scott Turicchi, the President of j2 Global, and with me today is Hemi Zucker, our Chief Executive Officer, and Kathy Griggs, our Chief Financial Officer.

This has been, and continues to be, a very exciting time for j2.

We will use this earnings call to discuss our first quarter fiscal year results and provide you with an update on our two business segments, as well as our updated guidance for the fiscal year.

In addition, our Board has increased the quarterly dividend to $0.24 a share from its previous dividend rate of $0.2325 a share.

We'll use the presentation for today's call.

A copy of this presentation is available at our website.

When you launch the webcast, there is a button on the viewer on the right hand side which will allow to you expand the slides.

If you have not yet received a copy of the press release, you may access it through our corporate website, at j2Global.com\press.

In addition, you will be able to access the webcast from this site.

After we complete our presentation, we will conduct a Q&A session.

At that time, the operator will instruct you regarding the procedures for asking a question.

I remind you that at any time you may e-mail us questions, at investor@j2Global.com.

Before we begin our prepared remarks, allow me to read the Safe Harbor language.

As you know, this call and the webcast includes forward-looking statements.

Such statements may involve risks and uncertainties that would cause actual results to differ materially from the anticipated results.

Some of those risks and uncertainties include, but are not limited to, the risk factors that we have disclosed in our various SEC filings, including our 10-K filings, recent 10-Q filings, proxy statements and 8-K filings, as well as additional risk factors that we have included as part of the slide slow for the webcast.

We refer to you to discussions in those documents regarding the Safe Harbor language, as well as forward-looking statements.

At this time, I'll turn the presentation over to Kathy, who will review our Q1 results.

Thank you, Scott.

Good afternoon, ladies and gentlemen.

Let me first say that I am pleased to report that our business is performing in line with our first quarter estimates.

And without stealing Scott's thunder, in light of our recently reported patent license agreement, today we are providing increased fiscal 2013 revenues and non-GAAP EPS estimates.

With this said, let me get into Q1's results.

I'm pleased to report that, yet again, we achieved record quarterly revenues.

Our Q1 2013 revenues were $113.6 million, an increase of 11.4% over Q4 of 2012, and 31.1% over Q1 of 2012.

We have enhanced the financial presentation now that we operate in two segments.

Because the Digital Media business experiences relatively higher amortization of intangibles as a percentage of revenues than does the Cloud business, we believe our overall company is now best evaluated based on the following measures.

Revenues, gross margins and EBITDA.

For Q1, amortization of intangibles was 11.2% for Digital Media segment versus only 4.6% for the Business Cloud Services segment.

Please refer to slide 5 in our presentation relating to our Business Cloud Services segment financial results.

For Q1, 2013 that segment achieved revenue growth of 4.7% versus Q1 of 2012 to $90.7 million, non-GAAP gross margin of 81.9%, non-GAAP operating margin of 43.4%, non-GAAP operating income of $39.4 million, and EBITDA margin of 49.6%, or $45 million.

Moving to slide 6, our Digital Media segment achieved revenue of $22.9 million, non-GAAP gross margin of $84.7 million, non-GAAP operating margin of 0.2%, or $38,000, and EBITDA margin of 14%, or $3.2 million.

Q1 2013 represents the first full quarter of our Digital Media business.

It is also the seasonally lowest quarter in this business, where Q1 revenues are expected to contribute approximately 15% to 20% of annual revenues, and Q4 revenues are expected to contribute as much as 35%.

Given the substantial fixed costs in the Digital Media segment, an even higher percentage of full-year EBITDA and operating earnings are attributable to Q4.

Q1 results also reflect our acquisition during the quarter of IGN Entertainment and the amortization and integration costs associated with that transaction, although the integration costs have been excluded from the non-GAAP numbers, as well as our Q4 2012 acquisition of Ziff Davis.

Please refer to slide 22 of the presentation for a recap of our Q1 non-GAAP consolidated operating results, and to the supplemental schedules at the end of the presentation for a reconciliation of all non-GAAP financial measures to their nearest GAAP equivalent.

On a consolidated non-GAAP basis, net income for the quarter was $26.8 million.

Consolidated non-GAAP gross and operating margins were 82.4% and 34.7%, respectively.

For Q1 2013, we achieved non-GAAP EPS of $0.58 per diluted share, compared to $0.64 in Q1 2012.

Q1 2013 results reflect $0.07 in interest expense not present in Q1 2012, $0.04 in non cash amortization expense associated with Digital Media acquisitions, and $0.05 in integration expenses associated with the Q1 2013 acquisition of IGN Entertainment, of which these integration expenses are already excluded from the foregoing non-GAAP results.

Our cancel rate for the quarter was 2.4%, consistent with Q1 of last year and within our annual range.

We added more than 61,000 paid DIDs this quarter, with the largest addition coming from our acquisition of MetroFax.

ARPU is $12.98 per DID this quarter, versus $13.31 last quarter, which we attribute to a change in mix of the annual versus monthly subscriptions, product mix and impact of the MetroFax acquisition.

Free cash flow for the quarter was $38.4 million, representing 34% of our revenues.

Consolidated EBITDA this quarter was an all-time Q1 record of $48.5 million, and up 6.4% from $45.3 million in Q1 2012.

Our cash and investment balances were approximately $310 million at March 31, 2013 and are approximately $348 million today.

During the quarter, we disbursed $73.5 million in cash for acquisitions and dividends.

Today we announced that, for the seventh consecutive quarter, we are increasing our dividend payout to $0.24 per share, payable on June 4 to shareholders of record as of May 20.

Since starting our dividend program in 2011, we have increased our quarterly pay out by 20% [quinterestly].

Holders of j2 shares, since we initiated our dividends through June 4 dividend, will have received $1.75 per share.

For Q1 2013 we incurred $6.8 million in non cash amortization expense on intangible assets, representing approximately $0.12 per share of our EPS, inclusive of the previously referenced $0.04 per share associated with the Digital Media segment.

Fluctuations in foreign currencies were not material to either our Q1 2013 or our Q1 2012 results.

Our estimated effective non-GAAP tax rate for Q1 2013 was 23.1%, consistent with the 23.1% rate for Q1 2012.

We expect our normalized tax rates for 2013 to be in the 25% to 27% range, due to increasing income in higher tax jurisdictions.

In conclusion, let me remind you that the supplemental schedules at the end of the presentation will provide you with more information on our metrics, as well as the non-GAAP to GAAP reconciliation schedules for all financial measures included in our remarks.

Now I'll turn the call over to Hemi, who will provide you with an overview of our business units.

Thank you very much, Kathy, and good afternoon, everybody.

We had an amazing quarter, for total revenue grew to approximately $114 million, and our Cloud Business grew approximately 5% year- over-year.

With that, let's turn into page 9, where I talk about our Cloud Services.

I'll start with online faxing.

We acquired at the end of this quarter, MetroFax.

MetroFax are better than j2 with their affiliate growth, getting customers from affiliate, and we are learning and deducting their know-how to improve the entire business of j2.

Our corporate revenues are up 9% year-over-year, to approximately $8 million -- over $80 million a year.

Our contract dollar value is up 41% year-over-year.

Our deal size -- sorry, we have new deals.

New deals are 144% year-over-year.

As you know, we are selling our corporate mainly through two channels.

One is our executive accounts in the field, and the other one is the telesales group.

We have increased our telesales group and increases to our productivity.

Our corporate telesales average DID per deal is up 3%.

Taking into account that we added Agent, it is -- the number per DIDs per month are high than Q1 last year, with 32%, and are averaging now 3,000 DIDs per month per this group.

Our online backup, KeepItSafe, revenues are up 60% year-over-year.

They are profitable since 2012.

Average revenue per employee there is about $400,000 per employee, and we are approaching $10 million per year on the run rate.

We have acquired recently Backup Connect, a Netherland company, and through our organic growth and our acquisition, we are now the number one in our category in New Zealand, in Ireland and in the Netherlands.

j2 now has customer support in multiple countries, in Ireland, in the US, in New Zealand and in Netherlands.

Businesses prefer to talk with locals, and we are catering to that.

Also, our General Counsel asked me to mention a fact here, and I always do what the General Counsel tells me to do.

So we are now the official online back-up provider for the Miami Dolphins.

Let's go now to page 10.

Cross sell.

As you know, we are very focused on cross sales and up sales.

We are doing it through database marketing.

We have launched it in March 2011.

Over the time, as we gain our confidence, we invested in R&D with the salesforce that we had for many years, and added the local one.

We have improving in strong cross sale results.

We have reached almost 38,000 new accounts, saving $4.6 million in media value.

j2.com which is a dedicated website for gross sales, is more than 1 million visits through the beginning.

And we have a new record.

Our cross selling effort delivered this quarter 5,500 new Cloud Services, which is up 15% versus prior quarter and 24% year-over-year.

Let's go to page 11, when I will discuss our intellectual property.

This effort is led mainly by our Legal Department.

Let me take you through the history.

So the first patent of j2 was issued back in New York in '97.

It was pending, and the patent was issued in late 2000.

In 2004, we launched a patent licensing program.

It's reported in our 8-K.

In April 25, we have our largest payment for license, $27 million.

To date, j2 have received $51 million in cash.

Our patent efforts are net cash positive, and we anticipate more settlements throughout the year; and our patents are going to continue and deliver -- are expected to deliver revenue for several years.

We are continuing to seek, develop, acquire and increase our licensing revenue stream.

Page 12.

I will discuss about our Digital Media.

It's operating under the name of Ziff Davis -- under the Ziff Davis brand, page 13.

Ziff Davis overview.

As you know, we acquired Ziff Davis in Q4, but we are strategic going back to Q1 '12.

In Q1 '12, the visits to the Ziff Davis property were $80 million.

Q1 '13 increased to $95 million, an increase of 19%.

The increase on page views was even stronger, grew up 30%.

Go to the chart on the right side.

Our revenue is up 22%, while the visits are up 90%.

This is a sign of productivity.

And our EBITDA is up 152% quarter-over-quarter.

I would like to make a comment.

As you know, in Q1, our revenue from the Media business is approximately under 20% of the total year, and the EBITDA is going to grow by Q4 more than the revenue.

So if the revenue would go from 20% to 40%, the EBITDA will go five or six times.

This is something important for you to understand about the reason and how our guidance is working.

Go to page 14, IGN.

As you know, IGN is the number one in gaming information [configuring].

We are very pleased with the integration of IGN.

We are according to plan and on track with our integration.

We exited IPL, GameSpy, UGO, and 1Up.

We actually sold IPL, and the rest we just are going to consolidate to our existing brands.

We have reduced the headcount by 85 heads.

This is more than 10%, or better than 10%, as we originally planned.

We cut $2.3 million in the nonstop related operational expense.

We reduced the rent by exiting unnecessary real estate by $1.4 million, and we are ready now to refocus IGN on growth and success.

With that, let me pass the call to Scott.

Thank you, Hemi.

And if you turn to slide 16, we are updating and increasing our guidance for fiscal year 2013.

As both Kathy and Hemi mentioned, we had a patent license settlement earlier this quarter, in the second fiscal quarter, for a $27 million payment.

Although the accounting is still being worked on, we believe that at least $10 million of that will relate to prior year past damages, and as a result, will be booked as revenue in Q2.

Since that's a very high margin revenue, that also will boost bottom line earnings by approximately $0.13 per share.

As a result, we have moved the previous range of revenues up by $10 million, such that the new range of revenues is now $510 million to $535 million.

And similarly, we've increased the non-GAAP EPS range by $0.13.

So the new range is now $2.78 per share to $2.98 per share.

Finally, as I mentioned at the beginning of the call, the Board approved a $0.24 per share quarterly dividend, payable to those of record as of May 20, with a payment date of June 4. It's still approximately $10 million of quarterly cash.

And as we've said before, these levels of dividends do not impact either our operational or M&A activities.

And then finally, slides 18 and following are the metrics for both the Cloud and the Media business, as well as the consolidated entity.

As Kathy mentioned, we believed that EBITDA is an increasingly important metric to look at within j2 as it is one way to look at the two segments of the business.

So slide 21 gives you the reconciliation for both free cash flow and EBITDA back to their nearest GAAP equivalents.

And then we have the reconciliation between GAAP and non-GAAP for the P&L on slide 22, reconciliation of Cloud and Media GAAP on 23, Ziff Davis on 24.

And I would note that Ziff Davis is only the Ziff Davis properties.

That does not include IGN.

And then finally, for our bond holders, on slide 25.

We have recalculated the covenants, based on the March 31 numbers.

We continue to be very strong in our capitalization and have tremendous flexibility under our covenants.

At this time, I would ask the operator to come back and to instruct you on how to queue for questions.

Thank you.

(Operator Instructions)

James Breen, WIlliam Blair.

Hello.

Thanks for taking the question.

Just two questions.

One, can you give us some clarity on the patent stuff?

So you won the settlement and you are going to get some cash in there.

Is there a way to frame what the recurring patent revenue is from that?

Or is that something you are just not going to know until you get the payments from the companies?

And then secondly, with respect to the Media business, just thinking about M&A again and what any near-term plans are there?

And then lastly, can you update us on the Carbonite situation, with the outstanding offer there?

Thanks.

Sure.

Okay, so let's deal with the patent.

First of all, I think you are specifically referring to the $27 million transaction.

Each settlement has its own unique characteristics which influence the accounting for it.

Now in this case, there's actually two pieces to the settlement.

So there's a payment already received by j2 of $27 million.

We are still working on the accounting allocation.

But based on what I had just said, assuming $10 million is for past damages and therefore booked in Q2, then the remaining $17 million would be amortized over the remaining useful life of the patents that were in question, which go out to roughly middle of 2018.

So that would be amortized over those succeeding quarters.

Not necessarily straight line, but that would be certainly the average approximation.

Now in addition to that settlement, there also is the opportunity for a running royalty rate, to the extent that customers who take 10 or fewer DIDs and reach a certain revenue threshold over a fiscal year, an annual fiscal year, of a relatively de minimis amount, we will then receive either $0.80 per DID or 8% of that revenue.

Having said that, the entity that we settled with, both -- in our judgment, currently is not offering those services.

So at the moment, I would not expecting anything to come in under the running royalty, although circumstances may change between now and when the patents run their useful life.

Second question on the Media, on the M&A.

I'll answer that question more broadly.

We continue to look for acquisitions in both segments of the business.

As we talked about during the last quarter, the primary focus for Media over the last 90 days has been to integrate IGN.

As Hemi mentioned, it was a fairly herculean task, given that there were some properties that, in our view, were a distraction to the core IGN and AskMen business.

There was a fairly meaningful reduction of personnel and consolidation of offices.

So Phase I, which is really the cost structure element of the IGN integration, is substantially complete.

However, as you'll also remember, we talked about the much larger number of visits and page views that IGN has relative to the Ziff Davis properties, and the fact that we believe, and continue to believe, there are opportunities to enhance the optimization of the ad sales to that traffic.

That is still very much in its early stages and in progress.

Having said that though, the Media business is entering a phase where it, too, will be ready for additional acquisitions, to the extent they present themselves and to the extent they make economic sense.

And we certainly are open to doing additional transactions in that space.

Similarly, we've done a couple of deals in the Cloud space, albeit on the smaller side, in Q1.

One in the fax space, domestically.

One in the online back-up space, internationally.

We continue to look for a variety of deals around the world in the Cloud space, I would say, predominantly focused on the existing service sets that we offer.

Specifically in terms of Carbonite, I don't think there's really a lot more we can say, other than we continue to own the stock, the 9.9%.

Their stock has traded up and down.

I think currently it's around $10 a share.

We continue to evaluate the situation based on financial results that they publish, presentations they make, and other information that is available to us.

And we'll continue to review that situation and make decisions accordingly.

James, let me add a few comments of my own.

The patents, as Scott said, and as we said last quarter, we are projecting it to be lumpy.

And we are continuing to get, of the license deals, we have many deals that are licensed already and they're paying on a monthly, quarterly basis.

We said it's lumpy, so actually this quarter it came short of expectations, for over $1 million.

But immediately, in the beginning of April, it caught up.

So lumpy, but it's coming.

On the M&A front, when we budgeted this year, we already knew about the IGN and the MetroFax deals, because they were in advanced stage.

So they were budgeted in and executed in the first quarter.

We have just finished four months, and we have another large part of the year to continue to do deals.

And I would not be surprised if you would hear about something coming in the near future.

On Carbonite, we are the owners of 9.9%.

And we are actually disappointed as shareholders that they grew quarter-over-quarter only 3.6%.

We expected the company at this stage to grow much faster than only that, and we hope that common sense will prevail.

We are not talking with them, but we are definitely watching it carefully.

Just one quick follow-up to what Scott was talking about on the expense side.

So, the expenses that were in IGN, you said it was some pretty heavy lifting there.

Those should come out in the second quarter, but were probably in there during the first quarter?

Yes, that's correct.

They're out of our non-GAAP numbers.

Because it's a combination of costs borne and exit costs.

And those total about $3 million.

Great.

Thanks a lot.

The answer is as of -- the things happened over a period of time, but basically the last event happened around April 8. So we have the cost structure of IGN, basically as of the beginning of the second fiscal quarter, that is in the format that we think makes sense.

And now the time and attention is being turned to optimization of the traffic and also, where possible, growth of the traffic.

Okay.

Perfect.

Thank you very much.

You're welcome.

Daniel Ives, FBR Capital Markets.

Thanks.

So now, with the integration mostly done, is there any change to the growth expectations for the year in the Media business?

I think, no, Dan.

Right now, we are holding firm with what we had articulated a quarter ago.

Obviously, when we gave the annual guidance and we split it into Cloud and Media, we had just acquired IGN.

There is nothing there at this point that would cause us to alter that viewpoint.

I do believe there may be some upside later in the year.

Part of the question will be the timing of when we'll actually be able to see some optimization on the existing traffic.

It takes awhile to be able to collect that data and then present that to advertisers.

If that can occur before year end, that's good.

That would probably be some additional upside to the numbers.

We did not budget that this year.

We are leaving that for '14.

But if I look at Ziff Davis's numbers, I'd say they are tracking to what we thought they would do for the full fiscal year, which as you'll recall, was about $60 million of revenue, just for the Ziff piece.

And Daniel, by the nature of the business, even though we are not buying more assets now, the way they are structured, Q4 is approximately two times maybe even of Q1.

So there will be growth in revenue and even more growth in profit, because of the nature of the fixed expense of this business.

So growth from a financial standpoint quarter-over-quarter, absolutely.

One of the things you can look at, just to follow-up on Hemi's comment is, you will see that in the 50 days of Q4 of 2012 that we owned Ziff Davis, we generated about $10 million in revenue and 40% EBITDA margins.

And then for the full fiscal quarter of Q1, the Ziff piece was a little over $11 million of revenue and about 13% EBITDA margins.

So you can just get a sense of the leverage in that business, because a lot of the costs are fixed.

But as you pile on those incremental revenues, whether it's through organic growth or through the seasonality of the year, you get very, very large flow-through of that to the bottom line.

And we are very, very pleased that for Ziff Davis, not only was there strong revenue growth in Q1 of '13 versus Q1 of '12, but the EBITDA flow-through was even better.

EBITDA almost tripled year-over-year.

Okay.

Thanks.

Hemi, does this mean you are officially a Miami Dolphins fan now?

Yes.

He's got his cap on.

I'll meet you in my booth.

(Laughter)

Okay.

All right.

All right.

Mike Latimore, Northland Capital Markets.

Hello.

This is Ryan MacDonald on for Mike Latimore.

I know you had just quantified the revenue and EBITDA margin contribution from Ziff, but maybe I missed it, did you -- could you quantify the contribution from IGN during the quarter, or did you quantify that?

We did not.

I will.

But I'll also let all of you know, we will not be breaking out Ziff and IGN in the future.

It will be reported as a consolidated segment of revenues and EBITDA.

However, since this is the first full quarter of reporting for Ziff and two-thirds of a quarter for IGN, we thought it would be instructive for people to see how the business flows over the four quarters, how the margins expand.

Since giving you the Ziff numbers, by implication, the IGN numbers for two months were about $11 million in revenue and about $1.7 million in EBITDA.

That EBITDA, though, is exclusive of some of the costs that Kathy talked about earlier.

So we actually got a little bit more of EBITDA, both in aggregate dollars and margin, out of IGN than Ziff in Q1.

And the total consolidated group, for the quarter, was slightly under $23 million of revs, $3.2 million of EBITDA, or 14%.

And you'll notice that both of them are strong gross margin businesses.

Ziff did about $9 million of gross margin in Q1.

IGN for the two months did a little over $10 million.

And the consolidated group did $19.4 million, which is actually at or in excess of the traditional gross margins of j2 Cloud, which are usually around 82%.

Okay.

Could you quantify roughly what organic growth was for the quarter for the overall business?

Well, the Cloud was basically all organic, which was the 4.6%.

Media would also be all organic, on the Ziff side.

There's really no way to talk about IGN organic growth, since it's new to us and in a different format than it was under Newscorp's ownership.

I would look at the Cloud business at about 4.6%, and I'd look at the Ziff piece at 22%, add them together and that would probably be a good proxy for your organic growth.

And then just final question.

Do you expect cancel rates to stay in this general ballpark going forward for the rest of the year?

Yes.

All right.

Thank you very much.

You're welcome.

Thank you.

Our last question comes from Greg Burns from Sidoti and Company.

Good afternoon.

I have a question about display advertising.

I know you were running some trials, getting back into that market.

Do you have any update on how those trials are going?

Yes.

I'll tell you that, as a practical matter, we did have a little bit of incremental spend.

We started, about mid-February, reintroducing and testing display advertising for our Cloud Services.

As you may recall, one of the things that's one of the synergies of owning a media company was it gave us the ability to put forward a very good test that we hope will run the full course of the year, to be able to put more core marketing dollars to work.

I think in Q1, given the mid-February start date, we spent a little under $300,000 of incremental marketing in that testing.

And I'll let Hemi comment on what we're doing and some of the early results.

So because it was mid-quarter, I have to be careful.

This is why I did not publish real numbers.

But what I know based on the data that I'm getting is that the CPA is dropping, it's improving, week after week.

We have cut off the programs that were not successful and increased the spending on the programs that are successful.

And one of the successfullest initiatives on the display is what you are seeing in our telesales, in the corporate.

We started to generate leads through displays through other ways for the corporate, and that is why they are growing now to 3,000 DIDs per month, for a group of seven or eight people.

So we are very pleased.

We are going to continue.

We are eliminating those that are not so good, and we are putting more money behind those that are very good.

Okay.

And then another question around the organic growth rate.

Of the 60,000 DIDs that you added --

61.

61,000.

Sorry.

I didn't want to short change you.

Of that, how much of that was organic?

Less than half.

You have to remember, we have acquired, this quarter, MetroFax.

And next quarter, if we didn't acquire anything else, you'll see organic only.

Next quarter, I meant.

Okay.

This quarter we're in, Q2.

But it's working well.

Okay.

And can you give us any color on some of the status of some of your other litigation that you have out there?

Is there anything that is in the order of magnitude of what you just announced?

No.

We had another settlement a few days later, which we got a seven digit, but immaterial amount, of money.

We still have some going, but not in the magnitude.

And we have a running program that, as we originally said, is anticipated to be like $10 million, $12 million a year, which some of it is already under the belt.

Okay.

And lastly, in terms of M&A and the online back-up market, do you have a preference?

(Laughter)

Seriously, look, we talk like businessmen, right?

What was the end of the question?

The end of the question was, you are expanding geographically, so is there a preference for geographic expansion or gaining scale in any particular market?

How are you looking at that going forward?

So first of all, we go after the easier one, which are the English-speaking markets.

Then we felt very comfortable with the Netherlands, and we made -- actually I think we are now largest, or very large, in the Netherlands.

We have continued -- there are many, many millions of companies that are using the same method that we are doing it.

We have made efforts to find out who they are and we are approaching them, and we are trying to do more in the English-speaking countries.

But because of the nature of the product, we are comfortable in going into non-English.

So far we have not found any -- so the first acquisition, let's say, in the market that doesn't talk English.

Let's say Germany, for example, has to come with a team, because we need people on the ground.

So we did not find something that is $1 million and north of it in the country that is not in the countries that we just mentioned.

But we are actively looking.

We have a team of people.

We actually even hired now one of our of the CEOs that sold us his company.

He's very well connected.

We actually did a contract with him for two months.

All he has to do is go around and find, in any country, companies that are like what he sold us and generate leads for us.

Thank you.

You're welcome.

Thank you.

I'll now turn the call back over to our speakers for closing comments.

Thank you very much.

We appreciate your time today to review with us Q1 results, as well as looking forward to the balance of the year.

As usual, look for press releases for upcoming conferences that we'll be presenting at.

I know specifically there's a conference in Santa Monica, California, at B. Riley, in a couple of weeks that we will be at.

And we will put out releases for other ones as they're scheduled between now and our early August earnings call to report Q2 results.

Thank you.