Applied UV, Inc.

And welcome to the Applied UV fourth quarter and year-end 2022 financial results conference call. At this time, all participants are in a listen-only mode, and a question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. Please note this conference is being recorded. I will now turn the conference over to your host, Brett Mass of Hayden IR. You may begin.

Thank you. Once again, welcome to Applied UV's 2022 earnings call. With me today on the call are Max Munn, founder and CEO, president and director, Mike Riccio, chief financial officer, and Brian Stern, president of Puro Lighting. As a reminder, all materials for today's live presentation are available on the company's investor relations website at applieduv.com. Sorry, let's say it again, applieduvinc.com. Before we begin, please take a moment to read the forward-looking statements in our earnings press release. During today's call, we'll make certain predictive statements that reflect our current view about future performance and financial results. We base these statements and certain assumptions and expectations on future events that are subject to risks and uncertainties. Our most recent Form 10-K lists some of the most important risk factors that could cause actual results to differ from our predictions. With that, I'll turn the call over to Max Munn. Max, the floor is yours.

Thank you, Brad, and good morning, everyone. My name is Max Munn. I'm the founder of Applied UV, and I became the CEO about three weeks ago. As it was for most other companies, 2022 was a very challenging year. Our challenge arose from the acquisition of Scientific Air in late 2021. With disinfection products that were substantially focused on one distributor, Scientific Air was also focused on one industry, which was hospitals, and with revenues totally driven by COVID-19. Consequently, sales collapsed for Scientific Air in 2020-22 as the pandemic receded. Unfortunately, our previous senior management's focus did not reposition the company to address this weakness at Scientific Air. Consequently, we recently determined that it was best to write down a substantial portion of our investment in Scientific Air and put this problem behind us. In addition to this non-cash write-down of goodwill, The company has incurred and our 2022 financials include significant one-time integration and acquisition costs related to legal and accounting expenses associated with our more successful acquisitions. Included in our 2022 expenses are other non-cash items such as depreciation, interest, and the issuance of options to key employees. 2022 was indeed a very challenging year, but it was also a turnaround year. We are therefore starting 2023 with our company much better positioned to achieve significantly improved results. Of this, I am extremely optimistic. As a reminder, Applied UV has two operating segments, the pathogen elimination and disinfection segment, which includes the development, manufacture, and marketing of air and surface disinfecting systems. And the hospitality segment, which includes domestic manufacturer of better mirrors and premium furniture specifically for hotels, resorts, and related properties. Now I'd like to take a more detailed review of our hospitality segment. In hospitality, MunnWorks is resuming its pre-pandemic growth as this industry continues to show strong growth fueled by the post-pandemic travel surge, which has accelerated faster than generally forecasted. This market growth has heightened the need for hotels to make capital improvements to facilities in order to maintain their franchise flags, something that was postponed for almost three years due to the pandemic. Hotel operators are now required to catch up on delayed refurbishment. In the last few months, we had several hotel developers place multi-million dollar orders with our company. This surging demand, coupled with our newly acquired 100,000 square foot manufacturing facility located in Brooklyn, New York, has given us a strong competitive advantage due to the demand for domestic manufacturing by these hotel operators. The cost differential between China and domestic manufacturing has decreased significantly considerably due to the 25% tariff, as well as other factors leading hotel management to favor U.S.-based manufacturing. Additionally, there is a significant fear of potentially higher tariffs because hotel developers are concerned with the ongoing negative dialogue between the U.S. and China, worrying that any potential conflict or even a threat of a conflict could result in more global supply chain disruptions as well as incremental and increased tariffs. These factors are driving more hotel operators to domestic manufacturing to mitigate supply chain delays and enable hotels to better manage project timelines and ultimately their revenue generation. Due to this shift and with very limited U.S. competition, we were able to raise prices significantly without displacing orders. which will result in margin expansion, which we expect to accelerate in the first half of 2023. As part of the Brooklyn facility acquisition, we inherited a number of lower margin products due to the fact that 50% deposits were paid in advance of our acquisition of the facility, but paid to prior owners of that business, leaving us with fulfilling those major hotel commitments without the benefit of the associated cash receipts. We delivered on those commitments, and all of our legacy orders have now been fulfilled. Our sales pipeline for hospitality, which is approximately $10 million today, with projects underway and slated in Cleveland, Washington, D.C., Indianapolis, Orlando, and Knoxville. We also plan to increase MunWorks revenues through the installation of our pathogen elimination devices as an option into our hotel guest room furniture to be supplied to better hotels. Now let me discuss the pathogen elimination and disinfection segment of our business. The domestic UV disinfection market is expected to reach $9 billion in 2027. The CDC states that each year, one in 25 patients gets a hospital-acquired infection, resulting in over 3 million serious infections and 100,000 deaths annually. This amounts to losses from contagious pathogens that cost the U.S. economy more than $270 billion, including lost productivity due to absenteeism. The recent CDC warning about the rapid spread of new and deadly drug-resistant superbugs such as C. auris coupled with the urgency for improvements in indoor air quality within HVAC systems in order to control the spread of pathogens will continue to drive adoption of many of our proven systems. Our recent acquisition of Puro and its technology further validates our long-term strategy for developing or acquiring the best technology to protect all of us from deadly pathogens. This strategy is not only correct, but is now firmly in place. Our technology helps keep people safe, but just as important, our technology protects and extends the shelf life of high-value agricultural products. With shortages and purchase restrictions, the resulting food insecurity being reported throughout the world, we have concluded that protecting food from farmers to table is a high priority and a major opportunity for us. Currently, with 15 to 25 percent of shipped agricultural products lost to spoilage during transit to distribution centers and transfer to food retailers, our company, in a venture with Cannon, Virginia, a unit of the Japanese company, will soon introduce a proprietary air purification system that could be incorporated into shipping containers and long-haul refrigeration trucks as well as distribution centers that we expect will significantly reduce food spoilage. This technology is the same photocatalytic oxidation system which we developed for NASA for use in the International Space Station. Our technology is not only currently being used to increase the shelf life for food but we are already generating revenue in the cannabis industry and in wine storage, and we also expect to expand into the preservation of cut flowers during transit and display. We believe that our focus on food security is as urgent as is health care and is also one of the highest investment priorities in the world today. We plan on growing our revenues in post-harvest food security by leveraging our success with our airside product line, because we have already demonstrated the reduction of food, spoilage, of high-value fruit and berries with global companies such as Del Monte, Dole, Whole Foods, and others. Two months ago, we completed the acquisition of Pure Lighting as well as LED Supply. As a result, we are forecasting total revenues of approximately $45 to $50 million for this current year. approximately a 100% increase over 2022. This further positions Applied UV as a fully integrated company, providing a broad pathogen elimination platform with leading technology that can be used by consumers, business, and governments. At this point, I want to also reiterate that I personally agree with the recent projection by a major investment banking research analyst that our common share price will likely reach $2.50 by the end of this current year. Our primary focus for growth in 2023 will be on food preservation, healthcare, and safe building systems, and will include the complete installation utilizing proprietary software and facilities HVAC systems, which will continually monitor indoor air quality. With the merger of Puro complete, our wholly owned subsidiary, Sterilumin, is gaining critical mass to address the ever-challenging and ever-changing challenge of combating air and surface pathogens at hospitals for required infections, protecting businesses and their facilities and their employees and consumers who frequent the facilities. After long delays due to the COVID-19, COVID pandemic. Late in 2022, our company began a clinical trial with our lumicide sink and drain disinfection product at the prestigious Mount Sinai Hospital in New York City. We expect to announce the results of this highly anticipated clinical trial in Q3 2023. To support our plan growth, we formed a scientific advisory board with renowned infectious disease scientists, as well as wine and food preservation experts. The company plans to have these experts speak at leading industry conferences and trade shows, as well as write publications in leading journals regarding the effectiveness of our pathogen elimination product. We plan to announce the details regarding this advisory board in the very near term. Our global distribution of strategic partnership expansion continued throughout 2022 with the company now boasting several established strategic manufacturing partnerships and alliances with Canon, Acuity Lighting, Johnson Controls, Ushio, Siemens, and Grainger. Additionally, our pathogen elimination segments global network has grown to include 89 dealers and distributors in 52 countries, including Southeast Asia, with 47 sales agencies, as well as our having 19 U.S.-based sales personnel. Our global customers will now have access to our complete suite of research-backed and clinically proven best-in-class product, including photocatalytic oxidation, advanced UVC-activated carbon, far UV technology utilizing newly-developed 222 nanometer wavelength radiation, as well as our new air monitoring and reporting software for use in smart building products. We recently announced a significant strategic manufacturing supply chain outsourcing agreement with Canon Virginia, a wholly owned subsidiary of Canon USA, one of the premier global advanced contract manufacturers. This agreement makes Canon the company's primary manufacturer and logistical partner for our entire suite of air purification solutions. Our joint teams continue executing on an accelerating plan to completely transfer our manufacturing to Cannon during this current quarter. We will simultaneously close our existing manufacturing and distribution operations, yielding a significant reduction in our fixed G&A. We believe this partnership will translate into production and logistics cost savings that accelerate development of our next generation product by removing manufacturing execution risk and allowing the company more effectively scale and focus on advanced technology development and marketing. We've also recently expanded our relationship with Canon Japan to include Canon Financial Services as a partner, which allows our company to offer, for the first time, leasing and finance options for our product to our customers. With the Pure acquisition, we're obtaining Pure O-Net software application, which will further differentiate our systems from those of our competitors. Through the introduction of Pure O-Net proprietary systems, our software will accelerate our industry differentiation by adding IoT integration throughout our entire product portfolio with proven software that continually monitors and reports indoor air quality throughout an entire facility. PureNet has recently been installed into almost 100 surgical suites. Puro's HVAC system products allows us to competitively compete in one of the fastest growing air pathogen elimination markets, offering complete systems with our proprietary air monitoring software, which is rapidly becoming a must-have in HVA systems. To conclude, 2023 will be a transformative and extremely positive year for AUVI. Now I would like to turn the call over to Brian Stern, President of Puro Lighting, allowing him to speak more about Puro and LED Supply. Brian?

Thank you, Max. This is Brian Stern. I was the CEO and co-founder of both LED Supply Co. and Puro Lighting. My new role as president of Puro Lighting and board director allows me to consolidate, integrate, and create a uniform vision for our air and surface disinfection technologies, which are made up of aerosol, scientific air, lumicide, and Puro Lighting. At Puro, our goal is to use this merger to leverage cross-selling opportunities and increase revenue per customer, while also improving bottom line profitability for the division and the organization as a whole. I'm proud to share that LED Supply Co., which I co-founded 14 years ago, has greatly expanded its business. And we now provide design services, lighting and technology distribution, OEM product development, after-sales service, and turnkey installations for new construction, renovation, and national account projects across the United States. Our reach has also expanded from just lighting and controls to include building technologies such as EV chargers, building automation systems, UV devices, and smart panels for low voltage irrigation gas and water metering. Our customers range from large developers to national energy service contractors, as well as lighting and electrical service providers. The merger with Applied UV allows us to realize many synergies with our LED supply code business. We're already enjoying the benefits of the merger as we have been able to start specifying Munworks mirrors and case goods products on a multitude of different projects. This has enabled us to provide our customers with a higher quality product with a better price point and improved gross margins for the company. And we recently announced a major $4.5 million contract with the X companies, the country's premier co-living rental property developer that has over $1 billion in planned construction. Moving on to PuroLighting, which was founded in 2019 with a mission of using light technologies to improve health and wellness within buildings. Today, PuroLighting has an offering that encompasses pathogen elimination and disinfection of HVAC systems, induct air applications, continuous air disinfection technologies, and surface disinfection technologies, which are primarily sold into healthcare, education, commercial facilities, and government spaces. We expect to announce in the very near future that we have renewed our agreements with one of the leading distributors, hospitals, expanding our reach into healthcare with our PuroNet plus Hilo plus PuroProtect systems, which utilize far UV technology. With this agreement, we also expect to announce that our PuroNet plus Hilo plus PuroProtect UV disinfection control systems are scheduled to be installed in 16 operating rooms at a leading medical school. This renewed agreement should help Applied UV achieve greater penetration of the PuroNet systems within the hospital segment, serviced by this distributor. Hospitals currently utilizing the PuroNet system include Mass General, University of Chicago Med, and Children's Mercy in Kansas City. Puro has continued to expand our business partnerships with the newly announced research partnership with Johnson Controls and Ushio. This partnership allows us to provide additional research on the safety and efficacy of FAR-UV technologies. Additionally, we announced an expanded partnership with Acuity Brands to further expand our Purell Protect FAR-UV portfolio of products. Next, I will turn the call over to Mike Riccio, our Chief Financial Officer, for a review of our financial results. Mike?

Thanks, Brian. Net sales of 20.1 million represented an increase of 8.5 million, or 73%, for the year ended December 31, 2022, as compared to net sales of 11.6 million for the prior year. This improvement was primarily attributable to the hospitality segment, with sales of $13.6 million, representing an increase of 7.7 million, or 130%, as compared to the prior year. This was largely due to the VisionMark asset acquisition in Brooklyn, accounting for $6 million of the increase, plus the increase in sales in the legacy Munworks business of $1.7 million. The pathogen elimination and disinfection segment had sales of $6.5 million in 2022, which represented a 14% increase over the prior year. The pathogen elimination and disinfection markets have not yet fully rebounded from the initial buy-in during the early stages of the COVID pandemic. Additionally, due to macro market shifts, the company saw major global trends toward end-to-end systems across entire facilities that include software monitoring capabilities. This allows facilities to implement standards in the current EPA Clean the Air initiatives and guidelines announced in early 2022. These guidelines set the standards that are focused on improving indoor air quality, including indoor air ventilation and HVAC systems in all public places. With these shifting macro trends, the company altered its marketing, M&A, and R&D activities to address these changes. The Puro merger, coupled with the strategic manufacturing partnership with Canon, further addresses this shift. Gross profit was $4.0 million, which is approximately 20% of sales for the year ended December 31st, 2022 as compared to $4.1 million or approximately 35% of sales for the prior year. Gross profit as a percentage of sales decreased primarily due to the higher sales mix of the hospitality segment. The hospitality segment sales for the year ended December 31st, 2022 were 68% of AUVI's total as compared to 51% for the prior year. Additionally, the hospitality segment's gross profit as a percentage of sales decreased year over year, largely due to the completion of projects that were in process when the company first acquired the assets of VisionMark in Brooklyn, which is a non-recurring condition. The company is totally focused on streamlining both manufacturing and distribution operations across both segments. SG&A costs were $14.8 million for the year ended December 31st, 2022, which represented an increase of $3.5 million as compared to the prior year. This increase was primarily driven by the asset acquisitions of VisionMark in Brooklyn in the hospitality segment in Q1 2022, and the asset acquisitions of Kess Science and Technology and Scientific Air in the pathogen elimination and disinfection segment at the end of Q3 and the beginning of Q4 in 2021. As a result, payroll and sales commission costs increased approximately $1.5 million, amortization costs increased approximately $1 million, marketing increased approximately $0.4 million, and rent and professional fees each increased approximately $0.5 million. The company anticipates efficiency gains in the coming year as all three acquisitions have now been fully integrated and synergies are being realized. The company had determined that a triggering event had occurred as a result of a settlement agreement with Scientific Air. A quantitative impairment test on the goodwill determined that the fair value was below the carrying value. And as a result, the company recorded a full non-cash goodwill impairment charge of $1.1 million on the consolidated statements of operations for the year ended December 31st, 2022. We also evaluated potential triggering events that might be indicators that other intangibles related to scientific error were also impaired. As a result of our analysis, an additional non-cash impairment of intangibles of $5.9 million was also recorded in the consolidated statements of operations for the year ended December 31st, 2022. As a result of the scientific error settlement and the change in the values of the shares of stock returned to the company, the company recorded a net gain of $1.4 million in other income in the year ended December 31, 2022. Other income in the year ended December 31, 2022 also includes $205,000 for the employee retention tax credit. The company recorded a net loss of $16.6 million for the year ended December 31, 2022, compared to a net loss of $7.4 million for the prior year. This increase of $9.2 million in the net loss was primarily due to the non-cash loss on impairment of goodwill and intangibles of $7.0 million, and an increase in SG&A costs of $3.5 million, as previously explained. The loss per share, per common share, is $1.41 for 2022. If we exclude the impairment loss, the loss per common share is 86 cents. as compared to a loss of 86 cents in 2021, which is in line with the guidance given by a prominent investment banking research analyst. With the integration of the Puro merger rapidly progressing, coupled with the shifting of our entire supply chain, logistics, offshore manufacturing, and next-generation product R&D to Canon, the savings and the reduction of duplicated expenses across all of our divisions is expected to equate to improvements in our SG&A, driving higher future earnings. Lastly, I would like to talk about the company's efforts to strengthen liquidity. On July 1st, 2022, the company filed a $50 million shelf registration on Form S3 with the SEC, which allows for flexibility to raise funds as needed. Additionally, in December 2022, the company entered into a loan and security agreement with Pinnacle Bank, which provides for a $5 million secured revolving credit facility. At December 31st, 2022, the company had approximately 2.7 million of unrestricted cash available on its consolidated balance sheet. I will now turn the call back over to Max for closing remarks.

Well, thank you. Let me just say that as the founder of AppliedUV, and recently taking on the role as the CEO, I'm absolutely committed to our success. 2022 was a tough year for all of us, but it was also a transformative year. We will continue to focus on our strategic priorities while at the same time tightening expenses across all of our businesses, aligning our resources, including cash, with current demand. I'm extremely optimistic about the outlook for both of our pathogen elimination and hospitality segments. We now have a great portfolio of highly effective product that our management team and I truly believe will be strong levers for growth in 2023. Thank you again, everyone, for joining our call today. This includes our prepared remarks. The operator can now open the call for questions.

Thank you. At this time, we will be conducting a question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment, please, while we poll for questions. Thank you. Our first question is coming from Chip Moore with EF Hutton. You may proceed.

Good morning. Thanks. Hey, everybody. I wanted to add first, I guess, on visibility and comfort around that $45 to $50 million top-line goal. I think, Max, I heard you talk about sort of a near-term pipeline of $10 million for OneWorks VisionMark. Any other sense of pipeline for PuroLED and some of the other parts of the business?

Well, Brian Stern, why don't you respond to the pipeline for Rupp? Puro and LED, and then I can talk a bit more about why we're very comfortable about a $45 to $50 million a year.

Sure. So current pipelines for Puro and LED, Puro currently has roughly a $500,000 pipeline as of the end of the last quarter, and LED roughly a $4.5 million pipeline with strong sales expectations for the remainder of the year for both organizations. So we feel very confident in the numbers that are being portrayed and hopefully we'll be able to meet those goals this year.

Chip, the backlog between all of our businesses is in excess of $15 million. uh... at the end of the first quarter last week we uh... we know what the outlook is in the near term because we're quoting uh... a significant number of jobs the percentage of conversion of quotes to actual orders to actual receipts gives us a great deal of comfort we will hit that 45 to 50 million. There's even a reasonable expectation that we'll exceed that. We have great expectation that there are several very large multi-million dollar projects that we've been working on throughout 2022 that we will get actual POs for this current quarter. So the metrics, the backlog, the RFQs that we're dealing with give us that comfort. I hope I've answered your question.

No, that's very helpful, Max. I appreciate it. And I guess around hospitality specifically, I guess capacity there with Brooklyn, and then I think you talked about getting through those lower margin orders, how should we think about that margin ramp for hospitality, I guess, specifically, you know, over the next few quarters throughout the year?

Prior to the pandemic, Munworth was running margins in excess of, in the low to mid-30s. We expect to be back to those margin levels. Now that we've completed the The projects that were undertaken during the acquisition of the Brooklyn facility, which, as I explained, 50% of the proceeds were turned over to the prior owners, which we didn't enjoy. So the margins, I think, are pretty much established historically. But I will tell you the problem that we'll have if we're going to exceed the forecast is a labor shortage. And we're working diligently with New York City agencies to train, at their expense, employees. As much of this country has already experienced getting decent jobs, employees with some skills is really the challenge today. It isn't the facility. It isn't the $9 million worth of equipment that we acquired with this facility. It's really employees. We're on overtime right now working on several large projects. We're just about to receive a $3 million to $4 million order from a European hotel developer for a major hotel facility. refurbishment and rebranding in Washington, D.C. So the challenge is going to be labor, not machinery, not the facility, not raw materials. It's a problem that is solvable, but it is an issue to deal in response to your question about where our capacity constraints are.

Got it. That's very helpful. And then another one around the canon relationship and this outsourcing agreement, you know, transferring that this current quarter, right? We're pretty much through it, I guess, the current quarter. But how to think about one-time costs or, you know, double costs and things like that and when that sort of normalizes. And maybe, Mike, more for you, any sense of, you know, SG&A, some of the implications there.

We've furloughed a significant number of employees in the legacy manufacturing business in Kennesaw, outside of Atlanta. We have very little duplicate SG&A because the contract with Cannon has them invoicing and charging us at shipment. So we have a variable cost structure rather than a fixed cost. cost structure in Atlanta currently. We're already seeing benefits in reduction of payroll and other SG&A in Atlanta. That's not an issue that is going to be a negative.

Got it. Okay, thanks, Max. And just one last one for me on sort of new product development. I think you talked about going after the, you know, shipping and potentially distribution center market more on the food spoilage side. You know, when should we think about that and how are you going to attack that market and how do you see that opportunity?

Well, to give you a very short science answer, photocatalytic oxidation, which we're probably leaders in, likely leaders in that technology because we've been running it for years and it's the system that's in the International Space Station and it was a science developed for NASA, removes ethylene from the air. And it removes ethylene from the air, our airside product, removes ethylene from the air utilizing photocatalytic oxidation. Ethylene happens to be the chemical in the air that accelerates food spoilage. So photocatalytic oxidation removes ethylene very effectively and converts it to water vapor and CO2, which are both naturally occurring in the atmosphere. So our systems, when they're in a refrigerated truck or in a refrigerated sea container bringing fruit, berries, flowers from South and Central America, and even from California to the East Coast, removes ethylene. It significantly increases the shelf life of valuable post-harvest product. It's a proven science. We're working with Cannon. We've had two sea containers delivered to the yard at Cannon in Virginia, and we're working on installing our systems in order to show large sea container companies such as Maersk that our system will significantly reduce the spoilage that they're currently responsible for while they transport high-value post-harvest product. We're doing a side-by-side video with and without our system our system in one container and nothing in the other container, both will be loaded with berries and bananas and other high value fruit and vegetables and show what happens over an average four to five day transit time in each of those containers. We know from existing science, science that's been proven in laboratories and tests at the University of California, Davis, and in videos that are available on YouTube by an Israeli company who's working on the same issue, but they're dealing with packaging, which we're not, shows that in the video specifically that I'm referencing, that bananas turn dark brown in four days in transit without... photocatalytic oxidation and will last over 8 to 10 days with it. So we know the science is there. We're going to prove it. We're going to bring it to the large shipping container companies. Del Monte, for example, has already installed our systems in a 2 million square foot refrigerated warehouse in Atlanta where they bring food in from the West Coast for redistribution. Maersk turns out to be a client of Canon, so we've got an entree to that introduction.

Interesting. That's helpful, Max. Maybe I can speak one last one around sort of sales synergies from the recent deals. I think you talked about, you know, Maersk getting some traction, you know, outside of the traditional hotel market via that relationship. Is that, how do you see that synergy opportunity, and is that potentially additive to that outlook, or is that contemplated within there?

It's not in our numbers yet. You're referring to the inclusion of aeroside into guest room furniture so that the hotel can sell a pure air room with the best science? Is that what you're referring to?

Any synergy to that, and also just the ones you're seeing now in terms of pull through of Munworks as well into some newer channels.

Well, that's an obvious one. The more near term and the one that we've already seen purchase orders for, LED Supply has received, as Brian Stern mentioned, the $4.5 million in orders for its systems. Included in that order is the first of at least four projects that Puro has paper on. The first one alone is for five, that involves Munworks, is for about just in excess of $500,000 worth of our backlit hotel mirrors to the multifamily development that LED has purchased with us for. Munworks is currently not in the multifamily space. But recently we've received an almost $600,000 order from the related companies, which is the largest real estate developer in the country, for medicine cabinets, which we manufacture, electrified medicine cabinets that not only act as mirrors but as lighting and obviously as medicine cabinets. And what LED is bringing to us is their extensive relationship with multifamily rental and multifamily condo developers that must supply a vanity and a medicine cabinet in every apartment, if not several. So we're now seeing business coming from that direction, none of which existed prior to last quarter.

That's great. Okay. I appreciate all the color. I'll take the rest of mine offline. Thanks.

Thank you. Once again, ladies and gentlemen, if you have any remaining questions or comments, please press star 1 on your phone at this time. Okay. As there are no further questions in queue at this time, I will turn the call back over to management for our closing remarks.

Well, I think we've made our optimistic statements very clear. I want to thank everyone for supporting our company, and we're looking forward to a very successful 2023.

Thank you. This concludes today's conference, and you may disconnect your lines at this time, and we thank you for your participation.