Eagle Bulk Shipping Inc.

only mode. Later we will conduct a question and answer session and instructions will follow at that time. To ask a question during a session, you will need to press star 1 on your telephone. As a reminder, this conference call is being recorded. I would now like to turn the call over to Gary Vogel, Chief Executive Officer, and Frank DeConstanzo, Chief Financial Officer of Eagle Bulk Shipping. Mr. Vogel, you may begin.

Thank you and good morning. I'd like to welcome everyone to Eagle Bolt's first quarter 2021 earnings call. To supplement our remarks today, I would encourage participants to access the slide presentation that is available on our website at eagleships.com. Please note that part of our discussion today will include forward-looking statements. These statements are not guaranteed of future performance and are inherently subject to risk and uncertainties. You should not place undue reliance on these forward-looking statements. Please refer to our filings with the Securities and Exchange Commission for a more detailed discussion of the risks and uncertainties that may have a direct bearing on our operating results, our performance, and our financial condition. Our discussion today also includes certain non-GAAP financial measures, including EBITDA, adjusted EBITDA, and TCE. Please refer to the appendix in the presentation and our earnings release filed with the Securities and Exchange Commission for more information concerning non-GAAP financial measures and a reconciliation to the most comparable GAAP financial measures. Please turn now to slide five. Dry bulk rates saw continued and significant upward momentum in Q1 as trade demand continued to increase thanks to both the ongoing reopening of economies and general restocking of inventories, as well as the effects of unprecedented amounts of fiscal and monetary stimulus getting put to work around the world. The Baltic Supermax Index averaged $16,633 in the first quarter, up almost 6,000, or 55 percent, as compared to Q4, representing one of the best historic quarterly increases on both a dollar and percentage basis. Asset prices followed suit, where, as an example, values for 10-year-old Supermaxes are up about 35 percent on the quarter. This represents the third highest percent quarter-on-quarter increase in the last 20 years, the first two being in early 2004 at the beginning of the 2000s dry bulk super cycle. I think it's important to highlight that values are moving higher on the back of a significant increase in the volumes of sale and purchase transactions as well. Year to date, over 115 Supermax Ultra Max vessels have been bought and sold, implying an annualized run rate of almost 400 ships. If maintained, this would be by far the largest amount of ships transacted within a year. Notwithstanding the dramatic increase in asset prices over the last few months, the chart on this slide would indicate significant potential upside remains. Spot rates are around 10-year highs, but prices remain well discounted to 2010 levels when spot rates were similar. Assuming a return to 2010-type levels, we could see further upside in secondhand values of around 50 percent, which would, of course, translate to increased NAV. Please turn to slide six. As mentioned in our last earnings call, we purchased a total of seven vessels between late November and early February. These acquisitions appear to be well-timed with current values up 35% on average or around $34 million basis recent transactions. To date, we've taken delivery of four of these ships with the remaining three expected to deliver between late May and June. Performer for pending deliveries, our fleet now totals 52 ships, 87% of which are scrubber fitted and overall averaging 8.9 years of age. Please turn to slide 7 for a review of the quarter. EGLE generated a net TC for the first quarter of 15,124, the highest level in more than 10 years. As we've discussed in previous calls, it's challenging to catch and beat a rapidly rising market as a percentage of days are fixed in advance. I've often said I'd love to have to explain why we didn't beat a market that shot up 10,000 over a few months, and that's exactly what has happened. Looking ahead, the strong upward momentum in the market has continued into Q2. Given our short-duration exposure and our active management approach to trading our ships, we've been able to successfully capture this move up. As of today, we fixed about 71% of our available days for the second quarter, at a net TC of 20,100 per day. Please turn to slide eight. In terms of operating performance, we generated $31.5 million of EBITDA, representing a 40% improvement over the prior quarter. I believe this increased performance really underscores the significant operating leverage inherent in our business. With that, I'd now like to turn the call over to Frank, who will review our financial performance.

Thank you, Gary. Please turn to slide 10 for a summary of our first quarter financial results. The continued improvement in the chartering market and our short duration profile drove our top line growth in Q1, with revenue net of both voyage and charter hire expenses totaling $61.5 million, an increase of 23 percent from the prior quarter. Net income came in at $9.8 million, for the first quarter, our most profitable quarter in more than 10 years. Earnings per share, or EPS, for the first quarter was 84 cents on both a basic and diluted basis. Adjusted EBITDA improved in Q1, coming in at 31.5 million as compared to 22 million in the prior quarter and 18.8 million for the first quarter of 2020. Let's now turn to slide 11 for an overview of our balance sheet and liquidity. Total cash, inclusive of $4.5 million of restricted cash, was $80.7 million at the end of Q1, representing a decrease of $8.1 million as compared to the year end. The decrease in cash was primarily a result of the $7.8 million principal payment on the ultra-co debt facility and the repayment of $15 million for the super senior revolving credit facility. In addition, we paid $47.7 million for the acquisition of three vessels, plus a further $4.7 million for advanced deposits on four vessels expected to be delivered in the second quarter of 2021. The outlays were offset by cash provided by operating activities of $14.3 million and $55 million drawn from the UltraCo revolving credit facility. Total liquidity remains strong at $119.7 million at the end of Q1. Total liquidity is comprised of total cash of $80.7 million and $39 million in undrawn revolving credit facility availability, $15 million on CHIPCO, and $24 million on the HOLCO RCFs. As previously reported, we have funded the acquisition of one vessel with restricted cash. In addition, we have secured new debt facilities totaling $51.5 million for six of our newly acquired vessels. We intend to draw down on these facilities as the vessels are delivered to us, and as of the date of this earnings call, we have drawn $29.5 million against three ships. Total gross debt, excluding debt issuance costs at the end of Q1, was $507.7 million, an increase of $32.2 million from the prior quarter. The increase is due to the $55 million we drew down on the UltraCo revolving credit facility offset by principal repayments of $7.8 million on the UltraCo debt facility and a repayment of $15 million on the Super Senior revolver. Please now turn to slide 12 for an overview of our cash flow from operations for the first quarter of 2021. Net cash provided by operating activities was 14.3 million in Q1. Cash flow was strong in the quarter on the back of improving charter hire rates. The chart highlights the timing-driven variability that working capital introduces to cash from operations, as depicted by the difference between the dark blue bars, which are the reported cash from ops numbers, and the light blue bars, which strip out changes in operating assets and liabilities, primarily working capital. As the chart demonstrates, the volatility caused by working capital largely evens out over time. Please turn to slide 13 for a Q121 cash walk. This chart lays out the changes in the company's cash balances during the first quarter. The revenue and operating expenditure bars are a simple look at the operations. The net of these two numbers is positive $33 million, which is close to our adjusted EBITDA number. Moving to the right, we incurred $5 million of dry dock costs in the quarter. The $53 million for vessel S&P represents the acquisition of three vessels for $47.7 million, plus deposits of $4.7 million paid for four additional vessels, and vessel improvements of $300,000. We repaid $15 million drawn from our super senior revolving credit facility and drew down $55 million from the ultra-co debt facility revolver. And we paid $12 million in debt principal and interest in the quarter. Let's now review slide 14 for our cash breakeven per ship per day. Cash breakeven per ship per day came in at $11,101 for the first quarter. Vessel expenses, excluding certain one-time non-recurring expenses related to vessel acquisition and sales, came in at $4,894 per ship per day in Q1. We continue to face higher operating expenses related to the COVID-19 pandemic as we are incurring higher lodging and transportation costs related to crew changes. Dry docking came in at $1,148 per ship per day in Q1, $364 higher than prior quarter on an increase in the number of dry docks completed in the quarter. Cached G&A came in at $1,626 per ship per day in Q1, down $198 from Q4. It is worth noting that our G&A per ship calculation is based on our owned vessels, whereas we operate a larger fleet including our chartered-in tonnage. If we were to include the chartered-in days in our calculation, G&A per ship per day would decrease by about $221. Cash interest expense came in at $1,573 per ship per day in Q1, which is marginally higher on a decrease in ownership days in the quarter. Cash debt principal payments came in at $1,860 per shipper day in Q1, $813 lower than prior quarter. The decrease is attributable to amortization repayments on the Norwegian bond debt, which are only paid semi-annually in Q2 and Q4. This concludes my comments. I will now turn the call back to Gary.

Thank you, Frank. Please turn to slide 16. As I indicated earlier in the call, spot rates are at their highest levels in over 10 years. During Q1, the Atlantic Supermax market averaged $20,398, outperforming the Pacific by over 35%, but roughly in line with long-term historical averages. The strength in the Atlantic market was broad-based, but in particular, robust grain shipments to China, pet coke from the U.S., and manganese ore from West Africa helped drive increased demand. More recently, it's interesting to note that the Pacific market's been outperforming the Atlantic since late March and is now about 25% higher. Although Pacific outperformance occurs from time to time, it tends to be during weaker markets. The fact that we're seeing this phenomenon in a robust rate environment is due to a confluence of events. Firstly, I think it underscores how strong trade volumes within this subregion is, with Chinese steam coal imports being a significant contributor. With coal prices reaching multi-year highs and domestic demand elevated, Chinese loosened import quotas in order to bring in seaborne imports. And with the Chinese effective ban on Australian imports still ongoing, exporters such as Indonesia and Malaysia have been benefiting, which is positive for supermax and ultramax tonnage, which tend not to participate in the Australian trades. In addition, as a result of the booming container ship market, the Pacific has been supported by spillover trades, typically carried on container ships. For example, we recently carried cargoes such as bagged cement from China to Guatemala and bagged fertilizer to Peru and Chile. While Pacific loading is a front-haul market for container ships, these trades represent backhaul routes in the dry bulk world, which has helped to push rates to levels above those in the Atlantic. These factors notwithstanding, we do expect the Atlantic market to strengthen over the next month or so, as South American grain export season comes fully online with robust South American exports forecasted. Please turn to slide 17. Fuel prices continue to trend higher on the back of increased demand for oil products. Higher fuel prices tend to be positive for spot rates as ships slow down to become more efficient, effectively taking capacity out of the market. In addition, and as can be seen on the chart, there's a strong correlation between underlying crude prices and spreads between high sulfur fuel oil and very low sulfur fuel oil. Current spreads are around 110, with forwards for Cal 22 trading around $130 per ton. As mentioned earlier, 80% of our fleet is scrubber fitted, so widening fuel spread is particularly beneficial to Eagle. As the global economy continues to recover, we expect further upside pressure to both fuel prices and spreads, both of which should be beneficial for our business. Please turn to slide 18. Net supply growth increased slightly in Q1. A total of 121 dry bulk new building vessels were delivered during the period, up about 37 percent quarter on quarter, but down 8 percent year on year. Partially offsetting this, a total of 35 vessels were scrapped during the same period. In terms of forward supply growth, the overall dry bulk order book now stands at a historic low of just 5.6 percent. For 2021, dry bulk net fleet growth is expected to come in at 2.8 percent. This assumes scrapping of roughly 10 million deadweight tons, which would be 33 percent less than last year, primarily as a result of a stronger rate environment. A total of 47 dry bulk ships were ordered during Q1, down by roughly 28 percent as compared to the quarterly average for last year. In addition to reasons we've discussed previously, such as higher cost of financing and uncertainty of future emissions regulations, two notable factors have entered the mix which should be helpful to limit ordering and future fleet supply. Firstly, new building prices have increased meaningfully in the past few months, with Chinese Ultramaxes now seeking $27 to $29 million for delivery, primarily starting in mid-2023 and beyond. Prices have increased due to rising costs for inputs, including steel, but also due to a lack of shipyard capacity that has shrunk quickly due to the pace of ordering in other shipping segments. As an example, orders for large container ships hit a record over the past few months, with more than 200 ships ordered, totaling over 21 million deadweight. This, combined with announced orders for other large and complex vessels, such as dual-fueled VLCCs, has helped to fill yards order books with ships that take considerably longer to construct and typically are more attractive for yards to build. Please turn to slide 19. Global growth expectations have been revised upwards since our last earnings call, reflecting a normalization in activity thanks to the expected impact of vaccines and increased stimulus. The IMF is now estimating the global GDP contracted by 3.3 percent in 2020 and is projecting a recovery of 6 percent in 2021. Please turn to slide 20. Dry bulk demand growth has been revised significantly upward as well, with 2020 now estimated to have contracted by just 1.6%. For 2021, forecasts are indicating trade demand growth of positive 3.8% as compared to last year. Notwithstanding significant challenges in some regions with COVID-19 and lingering uncertainty, we remain optimistic for the continued normalization of trade demand and see our market being a beneficiary from stimulus measures which are already being put in place around the world. With that, I'd like to now turn the call back over to the operator and answer any questions that you may have. Operator?

As a reminder, to ask a question, you will need to press star 1 on your telephone. And to withdraw your question, just press the pound key. Please stand by while we compile the Q&A roster. Our first question will come from Omar Nocta from Clarkson's Plateau. You may begin.

Thank you. Hey, guys. Good morning, Frank and Gary.

Morning.

Morning, yeah. You know, nice results, obviously, for the quarter, and definitely looks like some really strong ones coming up here. And just wanted to ask maybe about the fleet, you know, here at – At Eagle here the past several months, you've been fairly active fine-tuning the fleet. You sold some of the older ships a while ago, and you've been replacing them with these seven newer vessels. And as you highlight, those have turned out to be very well-timed, especially considering what the S&P market's done since. I think, you know, you spent just under $100 million on those vessels, and they're probably worth closer to $140 million. You were pretty active in the fourth quarter and into February, but over the past three months or so, at least from our side, from the outside, it looks like you've kind of quieted down the acquisitions. Where are you at the moment in terms of the fleet? Do you still expect to be busy on the acquisition front here in the coming months?

Yeah. Well, thanks for that. I mean, it's funny. We don't feel like we've been quiet, but you're right. We haven't acquired any more ships since February in the last few months. As I said in the prepared remarks, we think that asset values are trailing based on the current market. And really, the most important thing for that is the forward curve, which continues to push up. Next year is now trading close to 15, and 2023 is moving up to mid-12. So, As people get more confidence in the forward market, we think asset values have potentially considerable upside. So we are looking, as we always do, we're looking at further acquisitions. We feel comfortable where we are with our 52 ships. We only have three ships remaining that are over 15 years old. Ultimately, those are sales candidates, as the other older ships have been. But really, in our mind, it's about obtaining fair value based on where we think you know, the cash flow generation is for those ships and the forward curve. So we're not there yet, but ultimately those ships likely will be monetized and very likely will continue to acquire ships, you know, on a targeted basis.

I think that makes sense. And, you know, you brought up the SFA's and I think it's interesting, you know, given rates overall on the spot market are much stronger, you know, the SFA's are much more liquid and we're seeing a bit more time charger activity, so liquidity there. And, you know, as I look at the results, you know, It looks like, you know, your trading business, you had an average charter end cost of, say, just under $13,000 a day, but you earned $15,000, a little over $15,000 fleet-wide. So call it a $2,000 a day spread. And that looks like it compares to something in the, you know, a few hundred dollars per day in several quarters in the past. You know, maybe first thing, first question just off of that is, is that a good way to think about the performance of the trading business? I'm just looking at, you know, the TCN average rate versus kind of the overall average we've gotten for the fleet.

Yeah, you know, I would actually caution that because it's a very dynamic model, and it includes, you know, derivatives that we use to hedge away market risk and keep optional periods. And based on market development, obviously, in an upward-rising market, you tend to declare options and keep ships longer. You know, conversely, you don't in a falling market. I think, you know, if I were... to be trying to figure out the the premium, I would look at the historic and apply some percentage of that that I was comfortable with going forward. But But on a specific number of ships and margin, I think there's there's too many variables that come into play.

Yeah, that makes sense. Thanks. And I guess, you know, do you think because of all the liquidity that we are seeing in the market, do you think that this trading piece is going to start to become a much bigger element for Eagle going forward? Do you think you'll ramp that business up?

You know, for us, it's always about risk-reward. Every position, you know, we're always looking to arb between a physical ship, a cargo, potentially using a derivative. But it's really about risk-reward where we see the value of that trade. So given the volatility, there's more opportunities to trade. But again, it also depends on, as I said, you know, what the risk profile is of that. So Likely, I think we'll get back to levels we saw in terms of charter-in pre-COVID. We're still not there yet, and that was really hampered last year when it was all about just keeping cargo and keeping your own ships moving. I think you will see some growth, but it's not growth for growth's sake. Just for the benefit of – I know you know it, but for the benefit of others listening, we don't value from our charter-in business based on volume at all. Ultimately, it's about a net P&L that gets supplied to our own fleet. We're only doing it not for volume's sake, but if we can trade that around and increase the overall value of our own tonnage. And we do think that people own Eagle because we're an owner of Supermax and Ultramax vessels, and then we try and build on that earnings over and above index returns. But we're not going to build a separate operating arm that becomes, call it, outsized to our owning positions.

Got it. That's pretty clear. Thanks for that, and I'll turn it over. Great. Thank you.

Our next question will come from the line of Randy Givens from Jefferies. You may begin.

Howdy, gentlemen. How's it going? Good morning, Randy. Good morning. So, yeah, I guess following up on that, with the forward curve being pretty robust, you know, obviously you've given pretty strong quarter date rate guidance at a 10, 11 plus year high. For that 71% for 2Q, were there any short-term or medium-term time charters locked in? And then obviously with the forward curve still elevated, will you look to do any of those 6 to maybe 12-month time charters?

Yeah, so we don't typically disclose our chartering book and charter out. It's all part of our mix. As I've said before, we prefer to operate our own vessels on voyage basis and what have you. Having said that, if we're paid fair value for relighting a ship on time charter for a short period versus selling an FFA to lock in a revenue stream, then we'll do that. I mean, as an example, I'll give you one. We fixed one of our One of our ships recently, Singapore Eagle, for minimum six to about eight months to try and limit the redelivery window to a minimum six instead of about, you know, at 24,000. But if it redelivers in the Pacific, it's at 27,000. So just to give you an example, we do relet our ships as part of our portfolio approach, but it's not our go-to move. So it's a combination of voyage business, time charter, mostly short, FFAs, and the mix of all of those. But we're definitely, with an elevated forward curve, we are managing the book going forward and locking in certain cash flows. But at this point, beyond that, I'll leave it to the quarterly guidance within the quarter that we've provided.

Got it. Okay. And then obviously on the balance sheet front, continuing to improve. You've added some new debt. You've closed on that, I think it was $35 million credit facility. So is that building liquidity solely for more kind of acquisitions, or at this point are you looking to further delever the balance sheets or paying down debt? And if the latter, do you have any kind of net debt-to-loan kind of leverage ratio target?

Yeah, well, I mean, the answer is we come in every day asking ourselves what's the best allocation for capital. And as you mentioned, given the guidance, you know, there's significant – you know, positive cash flows at the moment. So, I mean, one thing is definitely de-levering. You know, we were, you know, positive going into 2020, and then we had COVID. And fortunately, you know, having a stance with undrawn revolvers and unencumbered assets, a couple Ultramaxes that we put bank debt on, enabled us to go through the pandemic without taking extraordinary measures or anything that was, you know, expensive, detrimental. We put leverage on at LIBOR plus 250 onto those Ultramaxes. We want to get back to that kind of defensive stance, and I say defensive in the sense that having that dry powder against what I think is what we deem to be an appropriate, you know, measure of leverage. You know, but as we go forward, we're looking at opportunities. As I said, we think there's upside in asset values, and we look to opportunistically continue to renew and now grow the fleet. But delevering is definitely something we want to do. You will note on the last three Ultramaxes, you know, the debt that we – brought on as a revolver. And so I think, you know, long-term you would see, or not long-term, but I think, you know, aside from our traditional revolver we had, I think you'd see us look to pay that down. And once we did that on those three ships, you would end up with unencumbered assets, which is something that, you know, in my experience in dry bulk, it's always good to have unencumbered access. They're essentially a performing proxy for cash in many respects, and I think that's a good thing to have in a business that sometimes surprises to the downsides.

Yeah. That makes sense. All right. Well, that's it for me. Thank you. Great.

Thank you.

Our next question comes from Liam Burke from B. Riley. You may begin.

Thank you. Good morning, Gary. Good morning, Frank. Good morning, Liam. Gary, you mentioned in your prepared comments that there had been some offsets or positive offsets with taking some container cargo on the dry bulk. Is that a meaningful shift, and is that sustainable?

Well, I'll start with the bladder part. It's a good question, and I think I would defer to the comments from the container, like Maris saying they believe that this will continue, I believe, until the fourth quarter was a statement, and other players. That's not our arena. Having said that, it's definitely meaningful. I mean, when you see ships fixing things, from the Far East into the Atlantic at $25,000 in our size. You know, those are numbers that historically trade at, you know, sometimes call it 40% of the market, even less. So, you know, you're seeing a total shift in that. The positive is it's not to the detriment of the Atlantic. It's simply that the Pacific market is elevated and I gave some examples of those. So I think it's sustainable as long as we see this dislocation in the container market, but how long that goes, like I said, not really our area, but I'm an interested reader of everything that comes out of the container world in that regard, because it is having a profound effect on both our rates, but also our trading patterns.

Great. And on the operating expenses, I think Frank mentioned that there was some COVID-related increases. Do you see, once those correct, I know it's difficult to continue to drive down operating costs, but Do you think you continue to manage down on those operating expenses?

Well, the answer is yes. I mean, unfortunately, the COVID expenses are, you know, they continue. And, in fact, I would say some of it is, you know, not most of it, but some of the incremental expense on that is self-imposed. When the ships now are roughly, you know, $1,000 an hour to run a ship, you know, having off hire because a crew is, you know, has an issue in terms of a crew change and holding a ship back for a day, day and a half is really meaningful, much more meaningful than the incremental cost of a couple days of being early and making sure the crew is tested and ready to go. So, you know, we're taking steps to ensure that, you know, the ships keep moving, especially now because they're generating significantly more, which means of higher costs significantly more as well. So going forward, yes, we're taking initiatives to cut OPEX, and that's an imperative. I've said before, OPEX is an output. It's not a target. We can get to a target number very quickly, but the most important thing is to run ships that are safe, compliant, and also reliable. But we absolutely are looking to improve on the OPEX numbers, but I'll leave it at that. Thank you, Gary. Thank you.

And once again, that's star one for questions. Our next question will come from the line of Greg Liss from BTIG. You may begin.

Hey, thank you, and good morning, good afternoon, everybody. You know, Gary, I was kind of curious, and I think you touched a little bit on it in your prepared remarks, you know, around the coal trade. I mean, clearly we're reading a lot of headwinds around India in terms of some of the slowdown that they're having issues around COVID. Has that been creating any kind of disruptions, dislocations in the coal trade in Southeast Asia?

Yeah, I mean, well, the answer is... Getting a little feedback here. Can you hear me? Yeah. So Q1, not at all. In fact, India coal was back to pre-COVID levels. Having said that, with obviously the humanitarian crisis that's going on there now, we absolutely expect that there'll be a reduction in coal consumption and coal trades. But we haven't seen it in a measurable way yet. but we expect Q2 will be impacted to some extent. You know, the one thing about the coal trade in the Pacific is it's a short-haul trade, right? So it doesn't have the same impact, although the volumes in terms of numbers for us, you know, it's about 14% of what we carry, coal in general, the majority of that being to China, but it's shorter haul, so it doesn't have the same impact on a ton-mile trade. You know, one interesting thing I mentioned in the prepared remarks that, you know, we don't participate in the Australian coal trade, but we have seen an example where we're actually, you know, finalizing terms on a trade at the moment for met coal from the U.S. Gulf to China on an Ultramax vessel. That is definitely not a trade we typically would see that we're benefiting from, and clearly that's a long-haul trade. So, you know, there are dislocations in the market at the moment, and For the first time in a while in dry bulk, they're not all negative. We're seeing some positive offsets to those negatives.

Absolutely. Just real quick, we're tracking, as is everybody, the fuel differentials. Just as economies, I guess India's side, have started to open up, has that created any any problems around sourcing? You know, back pre-IMO days, it was, oh, is there going to be high sulfur fuel available? Is there going to be low sulfur fuel available? At this stage, now that economies are starting to reopen, have you noticed any potential sourcing issues on the fuel side?

Absolutely, the answer is no, we have not. And, you know, I think the fuel spread you know, has continued to widen, and we believe as, you know, air travel and particularly long-haul international travel comes back, then aside from crude pricing overall, that that spread should, will likely widen, which is why we reversed our 2021 hedges, you know, earlier at the end of last year. So we're comfortable where we are today. It's around 110. Next year, around 130. But we think there's upside to that, you know, as things, you know, open up. But from an operational standpoint, fuel availability, no issue whatsoever.

Okay. Thank you all for the time. Have a great day.

Thank you. You too.

We'll begin at star one for questions. One moment for questions. And I'm not showing any further questions in the queue. I'd like to turn the call back over to the speakers for any closing remarks.

Thank you, Operator. We don't have anything further today, so I'd just like to thank everyone for joining us and wish everybody a good day.

This concludes today's conference call. Thank you for participating.