L.B. Foster Company

Good day, ladies and gentlemen, and welcome to LB Foster's third quarter 2021 earnings conference call. At this time, all participants are in a listen-only mode. Later, we will conduct the question and answer sessions and instructions will follow at that time. If anyone should require assistance during the conference, please press star zero on your telephone. As a reminder, this conference is being recorded. I would now like to hand the conference over to Stephanie Litswak.

Thank you. Please go ahead. Thank you, operator.

Good morning, everyone, and welcome to LB Foster's third quarter of 2021 earnings call. My name is Stephanie Lischwak, the company's investor relations manager. Our president and CEO, John Castle, and our chief financial officer, Bill Coleman, will be presenting our third quarter operating results, market outlook, and business developments this morning. Jim Gunson, the company's corporate controller, is also joining us this morning. We'll start the call with John, providing his perspective on the company's third quarter performance and updating you on significant business matters and market developments. Bill will then review the company's third quarter financial results. John will then provide an overview of the company's recently completed comprehensive strategy reassessment. We will then open the session up for questions at the conclusion of John's remarks. Today's slide presentation, along with our earnings release and financial disclosures, were posted on our website this morning and can be accessed on our investor relations page at lbfoster.com. Our comments this morning will follow the slides in the earnings presentation. Some statements we are making are forward-looking and represent our current view of our markets and businesses today, including comments related to COVID-19. These forward-looking statements reflect our opinions only as of the date of this presentation, and we undertake no obligation to revise or publicly release the results of any revisions to these statements in light of new information accepted required by securities laws. For more detailed risks, uncertainties, and assumptions relating to our forward-looking statements, please see the disclosures in our earnings release and presentation. We will also discuss non-GAAP financial metrics and encourage you to read our disclosures and reconciliation tables provided within today's earnings release and within our accompanying earnings presentation carefully as you consider these metrics. For the purpose of helping you understand the underlying performance of the company, we will be referring to adjusted EBITDA, adjusted net income, adjusted diluted ETF, net debt, and adjusted net leverage ratio during the presentation today as reflected in the reconciliation tables included in the appendix to the earnings presentation. Additionally, in September of 2020, we announced the equity sale of our RLS Test and Inspection Services Division. As a result of this divestiture, we have presented the Test and Inspection Services business as a discontinued operation, including within the earnings release and presentation, and have recast prior periods to reflect this change. The comments today will be focused on our results from continuing operations. Further, in September of 2021, we announced the asset sale of our Piling Products Division. Due to the nature of the sale, we have presented the Piling Products Division within continuing operations in our financial statements, but we have adjusted certain metrics as annotated in our presentation slides to reflect the sale for purposes of an even comparison. So, with that, let me turn the call over to John.

Thanks, Stephanie, and hello, everyone, and thank you for joining us today. I will start the presentation with a company overview on page three of the presentation materials and highlight that at our core, They'll be fostered as a company focused on building today's infrastructure. You'll hear more about this as we cover aspects of a recently completed strategy in our Virtual Investor Day, scheduled for mid-December. But the key takeaways from the company review perspective is that we are a global solutions provider of engineered and manufactured products and services that builds and supports infrastructure. Starting on page four, let me provide you with a few updates on the initiatives that we're able to accomplish in the third quarter, which I believe has helped to lay the groundwork for driving growth over the next several years. I will also discuss some of the market conditions we are currently experiencing. First, we were able to complete our comprehensive strategy reassessment. I led this process using an external consultant. In all, we spent six months leveraging the insights of the business leaders and industry experts inside and outside the company. to establish a vision and strategy that we believe will increase shareholder returns over the long term. One of our strategic outcomes was to divest our product and products business, which we had completed just over a month ago. This transaction freed up significant amount of capital that we intend to redeploy to our businesses with stronger competitive position and more attractive and growing markets. This transaction resulted in approximately $24 million in proceeds with $23 million received during the quarter and a remainder anticipated to be received in Q1 of 2022. We recorded a gain of approximately $3 million on the transaction. While we retained all pre-closing liabilities associated with the division, we also retained pre-closing receivables, which we expect will provide additional cash upside to the transaction. A second step we completed to position the company to have the ability to execute our strategy was the revision of our credit facility, which we completed in August of this quarter. This revised agreement provides more capacity, extends the maturity for an additional two-plus years, and provides more accommodating covenants and low interest costs. The credit agreement, coupled with the proceeds from the piloting investor, positions us for continued investment in organic growth opportunities, as well as the ability to execute on bolt-on acquisitions in the rail or precast product space, as they may come available. From a market perspective, we are encountering some challenges with inflation, with impacting raw material costs and putting pressure on wages. We have taken pricing actions to mitigate the impact and expect to take more. But it's difficult to offset all the inflationary effects driving some erosion of margins in certain parts of the business. In addition, like many industrial companies, we're experiencing supply chain disruptions, as well as lingering COVID-related effects. Specifically, our supply chain is experiencing headwinds, including delays in inbound oil materials and components. We continue to navigate through these challenges and act to mitigate the effects on our margins where we can. In the rail segment, our outlook for North America for freight and transit remains optimistic in the longer term. Today, however, depressed ridership levels continue to adversely impact our sales of some of our rail products we offer. We expect that the coatings and measurement business line, which primarily serves the midstream energy market, to remain weak despite rising energy prices as the lack of investment in energy infrastructure continues to persist. We are not projecting any meaningful recovery in this business unit from current levels for the foreseeable future and expect to continue to adjust the cost structure of this business as appropriate. Setting aside the midstream energy market, we are seeing new infrastructure projects being planned. Excluding activities associated with the vestiture of the piling business, our new orders increased by almost $20 million compared to Q3 of 2020. Investments in transportation general infrastructure projects are progressing. Railroads continue investing in operational improvements, and recent spending bills in the United States are providing additional support for our sewer markets, with the potential for the pending U.S. Federal Infrastructure Bill to provide additional uplift. Bill will cover the financials in more detail with you shortly, but I want to briefly touch on results for the quarter, as you'll see on page 5. Our revenues increased by approximately 10% over Q3 of last year and included a number of positive developments. Among them, a 15.6% increase in rail segment sales, with growth from our core rail products and increases in field services, particularly in the U.K., where service work on the London Crossrail project continued to ramp up during the quarter after many months of delays due to COVID restrictions. In addition, the infrastructure solutions segment grew modestly over Q3 of 2020 due to the strength of our fabricated steel and precast concrete product business units, which helped well set the lingering impact of the midstream energy market. Consolidated gross profit also increased compared to prior year, although the coatings and measurement business continued to be a drag on our results. Additionally, I touched on earlier, inflation and supply chain pressures impacted our margins in other businesses in the quarter. I am pleased with the new order activity during the quarter. Rail had a particularly strong quarter with $84 million in new orders. Excluding piling activity, the infrastructure solution segment was up over $4 million, with the pre-capped concrete orders up by 36% over Q3 of last year. Our backlog continues to be very robust, finishing at a healthy $232 million. Excluding the backlog related to the piling business, this would represent an increase of over $20 million compared to September 30th of 2020. I'd also note that our precast concrete business is sitting at near record levels, with backlog up 43% over September 30th of 2020. Our balance sheet continues to be very strong. utilizing some of the proceeds from potting divestiture, we were able to reduce our net debt to $26 million at the end of the quarter. With that as an overview, I'd like to turn over the call to Bill and let him cover the financials in more detail. Bill?

Thanks, John, and good morning, everyone. I'll begin my review covering the third quarter results on slide number seven. As a reminder, our piling business was divested at the end of the quarter and is not being treated as a discontinued operation. Accordingly, the amounts presented include the piling business results unless otherwise noted. As John mentioned, third quarter sales were $130.1 million, up $11.7 million, or 9.9% over Q3 of last year. we realized a modest increase in gross profit on the improved sales, while the 17.1% gross profit margin was 150 basis points down from last year, which I'll cover in more detail shortly. Third quarter selling and administrative expenses increased by $3 million, or 17.5%, to $20.1 million, primarily driven by increased personnel costs, as well as costs associated with our strategic transformation initiatives. Selling and administrative expenses as a percentage of sales increased 15.4% of 100 basis points from the prior year quarter. Third quarter net income from continuing operations was $2.2 million, or 21 cents per diluted share, compared to $16.6 million, or $1.56 per diluted share last year. Adjusted net income from continuing operations for the quarter was $200,000, or 2 cents per diluted share, compared to $1 million, or 9 cents per diluted share last year. Adjusted EBITDA totaled $4.4 million in the third quarter, a decrease of $3 million compared to Q3 of last year, driven primarily by the increase in selling and administrative expenses. I'll now cover our segment performance for the quarter reflected on slide number eight. Third quarter rail segment revenues increased $10 million year over year, with the increase primarily attributable to an increase in new rail deliveries and a modest uptick in our European operations during the quarter, due in part to easing operating restrictions primarily in the UK. Infrastructure solution segments revenues were up $1.7 million due to increases in revenues in both fabricated steel and precast concrete business units. Revenues have increased in these businesses in line with improved demand and greater infrastructure project activity levels. Partially offsetting this increase was a decline in the coatings and measurement business which continues to face a challenging environment in the midstream energy market due to excess pipeline infrastructure capacity and lack of new investment. Rail segment gross profit increased by $1 million year-over-year, driven by the sales volume in the third quarter of 2021. However, the rail gross profit margin declined by 140 basis points due primarily to products mix variation in the business year-over-year, coupled with escalating input costs in the business. Infrastructure Solutions gross profit declined $800,000 from the prior year quarter, primarily driven by a $1.3 million decline in coatings and measurement margins. This decline also drove the 180 basis point erosion for the segment gross margin compared to last year's third quarter. I'll now turn to our year-to-date results on slide number nine. Year-to-date revenues were $400.7 million compared to $381.8 million last year, representing an $18.8 million increase, or 4.9%. Gross profit decreased $6.1 million from the prior year comparable period, and the 16.8% gross profit margin for the year-to-date period with a 240 basis point decrease from last year. I'll provide a little more color on the revenue and gross profit performance in a moment. Showing and administrative expenses totaled $57.8 million, a $1.6 million increase, or 2.8%, with the increase primarily driven by professional service costs, including expenses related to our comprehensive strategy reassessment, that John will be covering in a few moments. Selling and administrative expenses as a percentage of sales in the current year-to-date period decreased to 14.4%, down 30 basis points from last year's comparable period. Year-to-date net income from continuing operations was $3.9 million, or 36 cents per diluted share, compared to $23.5 million, or $2.21 per diluted share last year. Year-to-date adjusted net income from continuing operations was $1.8 million or 17 cents per diluted share compared to $7.9 million or 75 cents per diluted share last year. Adjusted EBITDA totaled $15.5 million in the first nine months of 2021 a decrease of $9.6 million compared to last year, driven primarily by the decline in gross profit in the infrastructure solution segment, higher selling administrative costs, and favorable one-time items realized in the prior year period. Cash flows used for operations totaled $6.8 million year-to-date, compared to $16.2 million in cash provided by operations last year. reflecting the increased working capital needs with the recovery of sales volumes, including safety stock purchases related to our current supply chain volatility, coupled with the lower operating margins, primarily in the infrastructure solutions segment. Year-to-date capital expenditures declined to $3.6 million versus $7.7 million last year. Capital spending this year primarily relates to the expansion of our precast concrete business line in Texas and expenditures for our ongoing SAP implementation as we continue to progress toward retiring two legacy ERP systems. We completed our Boise, Idaho implementation in Q3, and we have two additional locations coming up on SAP in Q4. We estimate total annual capital spending at approximately four to $6 million or approximately 1% of sales. I'll now circle back to our segment performance for the first nine months of 2021 on slide number 10. Year to date rail sales increased by 19.8 million or 9.5% compared to last year with the sales increase primarily driven by more robust demand and favorable operating conditions in our primary rail markets this year. Year-to-date infrastructure solution sales decreased by $1 million, or 0.6%, compared to the prior year period. The decline was wholly attributable to the coatings and measurement business, with a $28.6 million decline in revenues driven by unfavorable conditions in the midstream energy markets. Both fabricated steel and precast concrete businesses had meaningful sales increases totaling $19.6 million and $7.9 million respectively. Rail segment gross profit increased by $2.9 million or 7.2% over the prior year period. The increase was primarily driven by improved volumes in the friction management and contract services product categories during the period. Segment gross profit margin of 19% declined by 40 basis points year-over-year on 10% higher rail product sales. Infrastructure solutions gross profit decreased year-over-year by $9 million, or 27.3%. The decrease was primarily attributable to the lower sales volume in the coatings and measurements business, with gross margins down $11.7 million versus last year. As a result, Infrastructure Solutions gross profit margin declined 510 basis points. Our liquidity and credit metrics are shown on slide number 11. Total available funding capacity, defined as our available capacity under our revolving credit facility plus our cash, was approximately $103.5 million at quarter end, up from both the beginning of 2021 as well as September 30th of last year. The improvement was due in part to the additional capacity under our revolving credit facility, which was amended and extended on more favorable terms during the quarter. Net debt was $26 million on September 30th of 2021, compared to $39.8 million last year, a reduction of approximately $13.8 million over the last 12 months. Our adjusted net leverage ratio for the trailing 12-month period is 1.2 times. We received approximately $23 million at closing for the piling divestiture, which was used to pay down our debt balance. We're anticipating further debt reduction during the fourth quarter due to a seasonal reduction in working capital needs, as well as our assumption that there will be no significant new restrictions related to the pandemic and continuing improvement in end market conditions. Also, we're still anticipating approximately $8.5 million in income tax refunds. However, IRS processing timelines are extended well beyond historic levels. and the $5.3 million refund filed for remains outstanding. We would like to believe this refund will be received in 2021, but it may slip into next year. We have an additional $3.2 million in federal tax refunds we will file for as soon as the $5.3 million is received. We remind everyone that we have approximately $78 million in federal net operating loss carry-forwards available that will substantially lower our cash tax burden in the future. Slide 12 provides a breakdown of orders and revenue by segment over the last five quarters. Note this information includes our piling business in all periods presented. In the third quarter, total orders were $138.9 million compared to $130.5 million last year, with the increase driven by the rail segments. Excluding new orders related to the piling business, order activity was up $19.6 million compared to the third quarter last year and $12.2 million on a sequential basis. Total orders in the third quarter were the highest level achieved since Q4 of 2019. Our book-to-bill ratio of 1.06 for the trailing 12-month period continues to trend favorably. On slide number 13, you'll see that the consolidated backlog excluding the piling business stood at $229.8 million as of the end of the third quarter. An increase of $20.4 million compared to September 30th of 2020 and $13.6 million compared to December 31st of 2020. While the rail segment backlog increased slightly as compared to September 30th of 2020, The infrastructure segments backlog improved $19.7 million over the last year, driven by the precast concrete products business unit. As you can see, our backlog remains robust at pre-pandemic levels and our order rates are trending favorable both sequentially and year-over-year. We remain focused on managing the operational challenges and supply chain issues we face as we begin to execute our strategy which John will cover next. Thanks for the time, and I'll turn it back over to John.

Thanks, Bill. At the beginning of today's presentation, we discussed LB Foster as a company focused on providing products and services to build and support infrastructure. As a result of our recent comprehensive strategic assessment, we defined the underlying businesses in our portfolio as either growth or return platforms, as you will see on page 15. Today we have a number of stable business that generate cash. These businesses may have limited top line growth potential, but will continue to support other businesses with greater growth opportunities. We will refer to these businesses as our returns business. We also have a number of businesses that we believe have greater growth potential by using technology and scale to create a larger market presence, primarily in the rail space. These businesses bring value to our customers by creating more productive assets, enhancing operating efficiencies, making customer activity safer and more reliable, and providing a more environmentally friendly profile by reducing the carbon footprint. We will refer to these businesses as our growth businesses. Both our returns and growth businesses add value and together form a very solid springboard for creating shareholder value. The growth platforms will receive a more significant allocation of investment, as these are the businesses that we believe can maximize shareholder returns and have the market headroom for sustained growth. As part of this assessment, we're realigning our management structure and re-correcting FG&A spending to enable the execution of this strategy. Our goal is to transform the company into a more innovation-focused provider of products and services to build and support infrastructure. We believe these actions will translate into higher returns on invested capital and increased value for our shareholders. You will hear more about our strategy at our Virtual Investor Day in December. On page 16, we are showcasing new and pending legislation that applies to our businesses. Both our precast and North America real business, which have identified as having growth potential, should benefit from increased spending on our national parks, transit operations, and freight rail. A federal infrastructure bill also has the potential to provide a further boost to our businesses as they relate to transportation, rail, and bridge rehab work. On page 17, we continue to see signs of improving demand and investment in our primary reserve markets as we will translate to longer-term growth for our business. However, the global supply chain shock inflationary pressures, labor shortages, and lingering COVID-related disruptions are likely to remain a near-term headwind. As I mentioned earlier, the coding to measurement business is expected to remain weak despite rising energy prices as the lack of investment in energy infrastructure persists with no meaningful recovery expected for the foreseeable future. The current inflationary environment is expected to continue to pressure margins. These inflationary conditions are prevalent across the business, including labor wages. In addition, we expect disruptions in raw material, labor availability, supply chain, and service partner resources to continue to 2022. We continue to be vigilant in our actions to mitigate the impact of inflation and disruptions where possible. Despite the present operating challenges, we remain optimistic in the longer-term prospects of our business. Order rates continue to grow with an accelerated pace in some of our business areas. Our backlog continues to rise and stands well above pre-pandemic levels. While global transit ridership remains depressed relative to historical levels, they have improved over the last year. And finally, the market needs for environmentally friendly solutions that enable operating efficiencies for our customers is stronger than ever. We are transforming our business by investing resources in these core capabilities, which will translate into growth, margin expansion, and approved returns over time. We'll be covering our strategy in greater detail at our investor day planned for December 14th. We believe it's an exciting time for L.B. Foster, as you can see on slide 18 from a market point of view. We have a strong value provision. coupled with an energized leadership team focused on an actionable plan to grow our businesses in attractive core markets where we have a strong competitive position with innovative offerings that drive value. This strategy continues to build on our company's legacy of being a global provider of engineered manufactured products and services that builds and supports infrastructure. Before I turn it back to the operator, I'd like to thank the entire LB Foster team for their hard work over the past quarter. The team embraced the market headwinds, including supply chain disruptions, impacts from COVID, a challenging labor market, rising prices, and the change in CEOs, but came together aligned to the strategy that I've outlined. I believe now more than ever we are poised to drive shareholder value into the future with the greatest asset, our people. I'll turn it back to the operator for any questions. Thank you.

Thank you. As a reminder, to ask a question, you will need to press star 1 on your telephone keypad. Again, that is star 1 to ask a question. To withdraw your question, just press the pan key. Your first question comes from the line of Alex Regale from B Riley. Your line is open.

Thank you. Good morning, everyone, and thanks for taking my question. I like the strategy a lot here, and I look forward to a lot more additional information on the upcoming analyst meeting. But I wanted to see if you, at this point, are ready to disclose any sort of organic growth targets that you may have and or cash flow targets or anything of that nature.

Hi, Alex. Thanks for joining us today. And I'm glad that you appreciated and got a sense of what we're doing to really understand what our value is in our core competencies of the company and how we're going to drive shareholder return now and in the future. We are going to cover this in greater detail in the 14th, so I hope you can join that session. But I will tell you, we're not going to be laying targets out today as well as targets on those days, other than I think we really have a good appreciation of where the value is going to be coming from and how we're going to underpin the businesses with the return side and cash generation.

Okay. And then congratulations on that very attractive backlog growth year over year. I suspect that opportunities have continued to be pretty positive through the month of October, so if you confirm that, that'd be great. But also wanted to get a sense as to how you're thinking about the margin profile in sort of the new work that was put into backlog and whether or not you've been able to adjust your pricing to sort of catch up to some of those inflated costs.

Yeah. So, again, good question. And these are the areas that we're addressing each and every day. You know, the divestiture of the potling business came right out of our strategy as really one of the first things we needed to do because it was not accretive to the overall average margin of the company. So that's going to put us in a better shape moving forward. The growth of the backlog that you mentioned has also been significant. And if you take out the piling, we have shown a growth of $10 million from Q2 to Q3. So we're going to, I think somewhere around 20 basis points is where the margin uplifted between quarters as well, between Q2 and Q3. So we are showing some significant improvements, at least significantly. In our go-forward basis, I'm not going to get into the details of that, but the mix of business coming our way is more attractive as it relates to growing our margins into the fourth quarter and into next year as well.

Very helpful. Thank you very much.

Thanks, Al.

Your next question comes from the line of Chris Sakai from Singular Research. Your line is now open.

Hi, good morning. Hi, Chris. Hi. I just had a question on the decline in gross margin. Just wanted to get your sense on, you know, if you could sort of quantify, you know, how much of the decline was due to destruction in the supply chain? How much was from COVID-related measures? And how much was from inflation? And then, you know, if I missed something, how much was from the rest?

All right, Chris. So that's a good question. And, you know, again, as I mentioned earlier with Alex, you know, those are ongoing issues that we're facing each and every day related to COVID impacts, the supply chain disruptions, moving different components around that we need to do. And I will let Bill give you a little more color on what we are seeing. But I also, before we get into that, you know, our team here has done a fantastic job of, you know, every day coming into a different situation, be it labor or be it inflation or be it effects of the COVID, of keeping things really moving in a very positive light. And a 20 basis point improvement from quarter over quarter in our position has been really fantastic results. But I'll let Bill give you a little more color on some of the details and bring you up to speed on that. Go ahead, Bill.

Yeah, thanks, John. And morning, Chris. Maybe I'll refer you to slide number eight, our Q3 segment results. I'll just make a couple comments there. If you look at the gross profit on a year-over-year basis, there was a $200,000 increase. The rail segment saw about a million-dollar increase in gross profit 140 basis points sequential or year-over-year deterioration. That was largely driven by product mix, a little, I'd say more so product mix than inflationary costs impacting the business within rail for that year-over-year comparison. And as John indicated, the rail segment actually from a sequential basis point of view was pretty flat in terms of gross profit percent from Q2 to Q3. So, I mean, that shows that we were able to manage the overall business and maintain gross profit percent despite those supply chain headwinds that we've been facing. On the infrastructure side, a little more of a deterioration that you can see on a year-over-year basis with the revenue up 1.7 million gross margin dollars. We're down $800,000. On a basis point of view, it was 180 basis points. You recall the issue that we have on our coatings and measurement business. It was about a 390 basis point year-over-year decline in gross profit in coatings and measurements specifically. And I think the coatings and measurement gross profit decline in the quarter was $1.3 million. So you can see the balance of the business was higher on a year-over-year basis. along with the sales revenue, which we're pretty pleased with, but we continue to have that headwind in codings and measurement. And then the last thing I would say is if you just think about the year-to-date results, over on slide number nine, we have an $18.8 million increase in revenue, but a $6 million decline in gross profit. If you flip to the next page, you'll see that the The margins in the rail business are doing pretty well on a year-over-year basis, down 40 basis points year-over-year, but nice revenue growth. But the key takeaway there is our coatings and measurement business, its revenue is down about $27, $28 million year-over-year, with a margin decline of $12 million. So, I mean, it's pretty clear to see that the year-over-year impact on a year-to-date basis is driven by coatings and measurement, and we're continuing to monitor that business to make sure we maintain cash neutrality here in the short term while we wait to see what the recovery looks like.

Okay. Great. Thanks. And then, you know, what are you guys doing to sort of protect against future supply chain disruptions?

Yeah. So, well, first of all, we're We get our engineering team mobilized, so really looking at our supply chain and looking for vulnerabilities related to how many suppliers we have and where they're located. So they've done a really nice job of, like you would typically do with supply chain, looking at costs. They're looking at assuring that we have the components we need, and we are uplifting some of those A components and making sure that we have those available in our inventories. So, those are the most important things we're doing is make sure that we have a number of suppliers, alternatives, as well as building up some of the inventories to make that happen. I think Bill could give a little color on some of the details we've done there as well.

Yeah, Chris, if you neutralize for the piling divestiture that occurred for the quarter, you'll notice that there was a pretty substantial increase in inventory. in the quarter, more than what you would normally expect to see. Some of that was due to the disruptions that we've had in shipments just because of the ability to get product out the door to customers. But then there's also some element of that which would be us buying material opportunistically to make sure that we have the availability of raw materials to be able to support fulfilling out the backlog. So those are some of the actions that we're taking, working with our vendors. on our sourcing arrangements as well as buying a bit more than we otherwise would.

Okay, great, thanks.

At this time, to ask a question, please press star one.

Again, to ask a question, please press star one.

Speakers, there are no further questions at this time. I would now like to turn the conference back over to Jan Castle.

Thank you, Blue, and thank you, everybody, for joining us today. And please join us on December 14th. We're going to roll out a more comprehensive view of the strategy and really give everybody an understanding of not just what the company is today but more importantly where we're going in the future. So thanks again, everybody. Be safe, and thanks for joining us today, and have a great balance of your week. Bye-bye.

This concludes today's conference call. Thank you for participating and have a wonderful day. You may all disconnect.