OneWater Marine Inc.

morning. My name is Chloe and I will be your conference operator today. At this time, I would like to welcome everyone to the One Water Marine Inc. Fiscal First Quarter 2025 Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you wish to ask a question, please press star and then the number one on your telephone keypad. If you would like to withdraw your question, please press the pound key. Thank you. I would now like to turn the conference over to Jack Ezell, Chief Financial Officer. Please go ahead.

Good morning and welcome to One Water Marine's fiscal first quarter 2025 earnings conference call. I'm joined on the call today by Austin Singleton, Chief Executive Officer, and Anthony Askwith, President and Chief Operating Officer. Before we begin, I'd like to remind you that certain statements made by management in this morning's conference call regarding One Water Marine and its operations may be considered forward-looking statements under the securities law and involve a number of risks and uncertainties. As a result, the company cautions you that there are a number of factors, many of which are beyond the company's control, which could cause actual results and events to differ materially from those described in the forward-looking statements. Factors that might influence future results are discussed in the company's earnings release, which can be found in the investor relations section on the company's website and in its filings with the SEC. The company disclaims any obligation or undertaking to update forward-looking statements to reflect circumstances or events that may occur after the date the forward-looking statements are made, except as required by law. Please also note that all comparisons to our fiscal first quarter 2025 results are made against our fiscal first quarter 2024, unless otherwise noted. And with that, I'd like to turn the call over to Austin, who will begin with a few opening remarks.

Austin?

Thanks, Jack. Thank you, everyone, for joining today's call. Our first quarter results came in better than expected, driven by a low double-digit increase in new unit sales significantly outpacing the industry. Overall, revenue increased 3% with same-store sales up 4%, driven by the strong push from our sales team to gain market share and optimize inventory. Margins declined in the quarter, reflecting the impact of deliberate actions to drive sales. Margins also vary by product. Current model year margins are holding up well, while brands we were exiting were discounted to close sales. Given the impact of hurricane Helene and Milton had on the west coast of Florida, I am pleased with our top line growth in the quarter. As you may recall, we temporarily closed several stores in the fall in preparation for the storm affecting Florida and the Gulf Coast. While it is difficult to quantify lost sales that we recouped during the quarter, sales in the impacted area were down mid-single digits compared to the prior year. Overall, we are making good progress on managing inventory, which is down 10% year-over-year. Our goal is to have cleaner inventories each quarter, striking the right balance of brand, make, and model, ensuring that we are well-positioned to meet customer needs while maintaining operational efficiency. These efforts are starting to pay off, as highlighted by our lower carrying costs on floor plan interest expense versus the prior year period. We are also seeing the benefits of our ongoing cost reduction initiatives taking effect. Selling general and administrative expenses declined on both a dollar basis and as a percentage of total revenue. Between our inventory position and cost actions, we are setting one water up for success in the quarters to come. Despite better than expected results in the first quarter, which is historically our smallest quarter, we remain cautiously optimistic about 2025. The industry continues to face uncertainty after a challenging 2024, and we have not seen any significant market changes that would alter our outlook for the year. As a result, we are reaffirming our guidance range for 2025. Our focus remains on executing our inventory strategy as we prepare for the summer selling season while remaining nimble to respond to any changes in market dynamics. With that, I will turn it over to Anthony to discuss the business operations.

Thanks, Austin. Sales in the quarter benefit from higher unit volumes offset by the lower average unit price as we work to drive sales during the slower winter months. With all of our stores operational again after hurricane related closures, we developed promotional strategies and actions to give customers additional reasons to buy. I am proud of the team's effort to achieve the increase in sales in the quarter that seasonally experiences the slowest activity. Our attention now shifts to the boat show season. Recent shows have been mixed results, some facing challenges like unprecedented cold weather and snow in Atlanta and significant rain at the St. Petersburg outdoor show. Despite these adversities, customers have been active when weather permitted, and overall sentiment has been positive. The premium category has done well and is in line with recent trends. All in all, we are ready to serve customers at upcoming events. After a year marked by high inventory levels, our focused approach to inventory management has put us in a strong position as the industry works to clear out excess and non-current inventory. While this push caused some near-term discounting, we are encouraged by our solid finance and insurance performance, which helped offset some of the impact and highlighted the benefits of our diverse business model. Total finance and insurance revenue grew 50 basis points as a percentage of total revenue compared to the prior period, and finance penetration remained strong. Our diverse brand portfolio continues to be a key advantage, enabling us to deliver boats and to meet the varied wants and needs of our customers across different markets. Meanwhile, the promotional environment has continued, with our manufacturing partners actively supporting sales initiatives and helping clear aged inventory. Although we typically build inventories in the winter months, we've added inventory from the fourth quarter at a slower pace compared to the prior year, being mindful of the volume and model of 2025 votes we are taking in. And with that, I'll turn the call over to Jack to go over the financials in more detail.

Thanks, Anthony. The first quarter was a solid start to the year, with revenue increasing 3% to $376 million from $364 million in the prior year. New boat sales were up 3% to $248 million in the first quarter, while pre-owned boat sales increased 7% to $57 million. Overall, same-store sales were up 4%, driven by an increase in new unit sales, despite the industry unit sales being down approximately 14% in the categories we participate in. Revenue from service parts and other sales for the quarter decreased 1% to $62 million, As we have seen in the last several quarters, reduced production schedules from boat manufacturers drove lower sales in our distribution segment, which were partially offset by increases in our dealership segment. Finance and insurance revenue increased 28% to $9 million in the first quarter and was higher as a percentage of total boat sales. Gross profit decreased 8% to $84 million in 2025 compared to $91 million in 2024. This was driven by lower margins of the brands we were exiting in addition to new and pre-owned vote pricing. First quarter 2025 selling general administrative expenses decreased 1% to $79 million. SG&A as a percentage of sale was 21%, down 90 basis points as a percentage of revenue due in part to lower personnel costs in the quarter, previous cost reduction actions, and ongoing expense management. These savings were partially offset by certain inflationary increase in fixed and administrative expenses. Operating loss decreased to $2 million and adjusted EBITDA was $2 million. Net loss for the first quarter totaled $14 million or $0.81 per diluted share compared to a net loss of $8 million or $0.49 per diluted share in the prior year. Adjusted loss per diluted share was $0.54 compared to an adjusted loss per diluted share of 38 cents in the prior year. Now turning to the balance sheet, December 31st, 2024, total liquidity was in excess of 40 million, including 23 million of cash and additional availability under our credit facilities. Total inventory at December 31st, 2024 was 637 million compared to 707 million at December 31st, 2023. We continue to improve our current mix in aging while we execute on our brand rationalizations. We expect to see some incremental benefits from further inventory reductions as we progress throughout the year. Total long-term debt as of December 31, 2024, was $428 million. Net of $23 million in cash results in net leverage of 5.2 times trailing 12-month adjusted EBITDA. We are focused on reducing leverage in the latter half of 2025. Looking ahead, we are maintaining our previously issued fiscal 2025 guidance and anticipate total sales to be in the range of $1.7 billion to $1.85 billion, with same-store sales up in the low single digits. We continue to expect adjusted EBITDA to be in the range of $80 to $110 million and adjusted earnings per diluted share to be in the range of $1 to $2. Our capital allocation priorities remain the same, driving organic growth, expanding our presence through strategic acquisitions and key voting markets. The pipeline is active, but we will continue to deploy cash where it creates the greatest value for shareholders. This concludes our prepared remarks. Operator, will you please open the line for questions?

At this time, I would like to remind everyone in order to ask the question, please press start and the number one on your telephone keypad. Again, that star, then the number one on your telephone keypad. We'll pause for just a moment to compile the Q&A roster. Our first question comes from the line of Fred Whiteman from Wolf Research. Your line is open.

Hey, guys. Good morning. I was hoping you could just talk about the cadence of the quarter, Austin. I think when you reported last or held a call last, you talked about some encouraging October trends. So I'm wondering if you could just update us on what you saw from sort of month-to-month basis.

I think it was a pretty solid quarter on every month if you were comparing it, you know, over last year. But I would say, if anything, you know, December's the one month that you really can't pinpoint because, you know, it starts to get really cold in some places, but then people get caught up in, you know, Thanksgiving into November and running into, you know, just the year end, New Year's and Christmas. I would say October and November were pretty daggum strong, and December was probably, you know, on average a flat end. And you probably have a better feel for that than I do.

Yeah, I think you described it exactly. I mean, our October and November were very strong, with December just being what it normally is in normal times.

The thing I'd point out, too, is that October in particular, especially the first half, and the Florida locations were impacted by the storms. So that kind of geography was a little bit light compared to the rest of the country.

Okay, that makes sense. And then just on the front-end grosses, it was down year over year and then down a little bit sequentially. I know you guys are exiting some brands, so can you maybe just give us some guideposts for what that looked like, maybe on a like-for-like basis versus the exited brands, how to think about that margin profile going forward?

Thanks. Jack, you want to? I'll just say, let me just say this, and then you can kind of fill in what I don't, you know, wherever. when we get to those exiting brands, we want those things gone. I mean, there's no support from the manufacturer. You know, the sales guys don't like them because, you know, there's no real long-term future in them. So they gravitate for the other things. So, I mean, it's a tough sledding, and we've done a really good job of pushing those through. But those are coming at zero margin or either a negative margin. And so it's having a pretty good impact. I think, you know, We mentioned, you know, in the script up there that, you know, the new year model stuff is, you know, got a much better, healthier margin. And the further we get into this year, the better off, you know, that's what gives us a little bit of confidence. You know, and what we said last quarter on the earnings call was, you know, one of those green shoots that we saw as we get rid of these exiting brands, we do feel like we'll get some margin lift because the new boats are bringing a higher margin.

Yeah, Fred, I think, you know, next quarter we'll see some margin pressure continue as we, you know, get through the rest of them. But I would expect once we get past, you know, our second quarter and kind of get into the heat of the season that, you know, margins may pick up a little bit. But, you know, we're focused on making sure we keep our inventory in check and, you know, we're balancing that with, you know, our model year 25s are coming a little bit slower than model year 24s did. You'll notice that by inventory decline, you know, year over year. And we're going to continue to focus on bringing those numbers down.

And, Jack, just to be clear, when you say pressure in two cues, is that a sequential comment, year over year comment, both? What do you mean?

Yeah, it's a year over year. I would say sequentially, you know, it's flattish, maybe even a little bit better. You know, again, it's really hard to move a lot of product in those winter months, you know, especially – outside of Florida, and the team did an outstanding job outside of Florida moving product.

Perfect. Thanks a lot, guys.

Our next question comes from the line of Joe Altobello from Raymond James. Your line is open.

Good morning. This is Martin on for Joe. I just first wanted to touch on the comp. Do you have an idea of where comp was excluding Florida?

Yeah, it's going to move up, you know, I'd say it was probably in the range of 6%, 7%.

Okay. And then just quickly on comp again, do you have a breakdown between units and ASPs?

Yeah, I mean, it's largely units were up double digits. So I think it was in the 12%, 13% range.

Perfect. Appreciate it, guys. Thank you. Thanks.

Our next question comes from the line of Mike Swartz from PreSecurities. Your line is open.

Hey, guys. Good morning. Maybe just starting with inventory. Jack, is there, I guess, an inventory level you guys are actually, in terms of new boats, is there an inventory level you guys are targeting for fiscal year end? And maybe, you know, what does that look like relative to where we are today?

Yeah, no, we made a good concerted effort with the sales push as well as with how we're managing our orders this quarter. Our target for September 25 is to be down year over year 10 plus percent. I think, again, while we're down a little over 9% this quarter, I think that could flux in next quarter as we take some additional bows in advance of the season. You know, so that'll be a little fluid throughout the year, but our goal is to be down in excess of 10%.

Well, you know, yes, our goal is to be down, Mike, our goal is to be down a little bit just because we've exited, you know, nine brands. But, I mean, we're also going to, you know, continue to do what we do every day, and that's monitor the market. I mean, we feel pretty good about this year as we move into the back half. I don't know if that means that we're going to see a big push on the retail side. But if, if retail comes out better than expected, then that, that'll probably not be the case. I mean, we'll have to plan accordingly based off what demand is and what we're seeing out there. And we watched that on a weekly, you really on a, almost a daily basis.

Yeah. It, it, And just sticking on the subject of inventory, is there a way to think about maybe what used inventory, or sorry, not used, what aged inventory looks like today maybe versus a typical, whatever typical means, year? And then also, I guess, how much inventory do you still have kind of wrapped up with some of these brands you're exiting? I'm just trying to get a sense of you know, how impactful that headwind is over the next couple quarters relative to, you know, what we've seen the last, call it six months or so?

Yeah, I wouldn't say it's that impactful over the next couple of quarters. I think we'll, as Jack said a little while ago, we'll feel the pressure of it, you know, a little bit this quarter. But, you know, I look at it just from a total dated standpoint because all those brands that we're exiting are really in my dated box. So you've got current 2025s and then you've got dated stuff. And typically – in a normal year, pre-COVID, for, you know, two decades pre-COVID, you really went into the off-season wanting somewhere around 20, or not wanting, but the industry usually ended up going in there somewhere around 20, 25% of, you know, carryovers going into the new year, calendar new year. And, you know, we always wanted to be slightly under that. Jack, I don't know if you have that in front of you, but, I mean, we're probably less than 20% right now, or right at that, aren't we? Yeah.

Yeah, I don't have that right in front of me. I would agree with your comment. I did hear from some data I'd gotten from Wells that suggested the industry as a whole was kind of getting to that point.

Yeah. The inventory story to me, not just one water, but for the industry per Wells – is that inventory is cleaning up pretty dadgum good. I don't really get into, you know, total inventory out there from a Wells perspective versus what's the dated. And they seem to be a lot happier today than they were, you know, a month ago, three months ago, six months ago, especially forecasting going into the selling season. So the inventory itself from a dating perspective is continuing on the trend that it's been on the, you know, the last, six months cleaning itself up slowly, but surely. And that's, that's some of the green shoots that we see in the back half of the year.

Okay. Okay. That's, that's helpful. Thanks Austin. Um, and then maybe just philosophically, right? Um, your, your quarter came in plus four and comp, despite a lot of the, you know, the headwinds and challenges that we had with some of the, particularly some of the dislocation in the Florida market. and you're maintaining your outlook for the full year despite having some pretty easy comps going forward. I mean, can you just give us a sense of, you know, maybe what that discussion was like internally, you know, in terms of just maintaining that outlook?

Yeah, I mean, you know, I think, look, a lot of it has to do with, you know, when you think about Q4, or excuse me, the December quarter, right? It's the slowest quarter of the year. You know, when I go out and I look also at consensus, you know, consensus has, Q3 at EBITDA of $50 million, which feels a little strong. And so I think if you layer in – and Q2 and Q4 tend to be pretty close to one another. And so I think if you bring down Q3 a little bit and level out Q2 and Q4, I think that kind of keeps you around that 95 consensus number, which is the midpoint of the range.

Okay. Thanks. You know, Jack, I'm a little bit more of an optimist, you know, and I'm starting to really kind of – you can see some of these green shoots. But, I mean, we thought we've seen some green shoots in the past and been throwing curveballs. And so, you know, we really want to watch out and be a little bit more cautious until we get a little bit further into the selling season. You know, in the back half of Miami – you know, after that Miami show, I think we'll have a little bit more confidence in what's in front of us versus where we are today coming out of the, you know, like Jack said, the slowest quarter of the year.

Yeah, I'll just point out too, right, what once felt like a tailwind of interest rates, you know, from the Fed and whatnot, it feels like rates, you know, the latest forecast suggests that we're not going to get as many cuts as, you know, we thought, you know, three or six months ago. And so, you know, I don't feel like it's, you know, necessarily a headwind coming at us, but it just doesn't feel like we're going to get the, you know, some of that relief maybe we were expecting in the back half of the year.

Gotcha. Okay. Helpful. Thanks, guys.

Our next question comes from the line of Noah Zaskin from KeyBank Capital Market. Their line is open.

Hi. This is Ryan on for Noah. Thanks for taking my question. And I know you just kind of briefly touched on it, but, you know, it would be great to hear your perspective on the industry. You know, we're in a difficult environment, and it seems like, you know, that rate conversation has changed and has maybe kind of put on pause for now. But, you know, it would be great to hear, you know, if you're seeing any other kind of green shoots or changes in confidence, you know, coming out of this quarter.

I don't know if there's a change in confidence. I think that, you know, me and Jack and Anthony talk about it a lot. I mean, the green shoots that we kind of laid out, you know, last earnings call are still out there, and they still look reasonably achievable. And, you know, when you get into, you know, what really will be one of the biggest drivers of that, and that's inventory cleaning up. Because as inventory cleans itself up from a dated perspective – I think if you took the total industry and took all the 2024s out and older, the dated inventory out, and you just looked at what the industry has, just in 2025, the industry is super healthy. I mean, the manufacturers have been disciplined on cutting back production. The dealers are taking the right amount of inventory going into 2025. So when you look at that, you're like, okay, we're in great shape from an industry perspective. It's getting the other stuff cleaned up, and the quicker we clean it up, That leads to several things from a warm water perspective that we look up. It leads to higher margins on new boat sales. It leads to more turns on new boats, which saves us money that we can count because we know what our interest savings is when you increase your turns. But there's dollars that are hard to quantify. If you move a boat 25 times around the lot versus one time, there's a cost associated with it. And then you look at interest savings. Even if the rates don't move, the more turns, the less interest you pay. know and so but then as inventory cleans itself up the manufacturers are going to get ready to increase production going into 2026 which swaps over and helps th you know because th doesn't have to do anything today to increase its revenue and bottom line all we need to do is have the manufacturers increase production ten percent and we'll get a ten percent lift on what we sell to those manufacturing you know with a ten percent increase in in sales there for those manufacturers that are increasing sales because they have to have the parts in order to build the boat. There's all these little things that kind of are starting to really take shape, but a lot of it has to do with getting that inventory cleaned up. And I would just say at the end of every quarter, really at the end of every month, and now really on a weekly basis that I'm talking to Wells, we're headed in the right direction. The train hasn't come off the track and that's starting to build confidence as we go into the selling season. And, you know, it's just a little bit of a wait and see.

We just need that to continue. Yeah, thanks for taking my question.

And maybe just pivoting a little bit, it would be helpful to hear, you know, any thoughts around the state of pre-owned market, you know, what you're kind of seeing there and how you're thinking about used in 2025.

Yeah, it's the same old broken record that we've been saying. You know, for the last 25 years, you know, we don't have enough of them. You know, that pre-owned market is still extremely limited on inventory. It's still extremely limited on, you know, from an industry perspective, there's just not enough out there. And I don't see that getting better anytime soon.

Our next question comes from the line of Alice Requent from Baird.

Your line is open.

Yeah, good morning, gentlemen. Thanks for taking my questions on for Craig this morning. You know, maybe a little bit related to the pre-owned question, but a little more focused on new. Curious if you have a way to measure first-time buyers versus trade-in buyers. In some markets like auto, you know, we're seeing some would-be trade-in consumers sitting out, right? because the monthly payment math just doesn't make sense given inflation rates and trade-in values. So wondering if you're seeing anything on that and how it's playing out in the marine category.

Jack, Anthony, I'll let you all take that. I mean, you can speak really to the Atlanta Boat Show probably on that, just what we saw there.

Yeah, I think we are seeing the amount of trades starting to reach up where prior in the COVID period where the trades really dropped down significantly. And, you know, this whole fiscal year has already started off with, you know, more of a demand in trades. People are trading boats in where they weren't before. You know, we are blessed to be tied to a lot of manufacturers that continue to be innovative that gives people a reason to trade, you know. Whereas, you know, 20 some odd years ago, the new boat came out and it was just a different color where today, you know, every year our manufacturers are bringing some incredible things. So it's making people want to trade. So the percentage, I don't, Jack, I don't know if you have that in front of you, but the actual percentage, but it has gone up dramatically where it was.

Yeah, our sales, you know, again, right, what Austin was getting at, our biggest challenge is supply when it comes to selling trades or selling used boats. And so I think we've seen some indicators of supply coming in at the shows, like Anthony referred to. When you break down our sales, our pre-owned sales, which are up 6.5% year over year, actually trades are up double digits in that, countered by a little bit of people shifting from a little downward trend in consignment, right? So people go ahead and trade in their boats to get in that new product. Is it easier? more efficient process for them where they can, you know, just hand over their trade, and we'll take care of the paperwork and everything else with getting them in a new boat.

Well, but one other thing, too, though, that we need to kind of – it's really hard for us to get really good clarity on this because, you know, we have – we've been pushing for years, and some of the states that we operate in have now gone to basically a title – So, you know, a lot of boats in the past went from consumer to consumer, never went through the dealership because there was no tax advantage. And the way that if you sold it from person to person, you didn't pay sales tax. That started to change because when you go and get the – and it was like that probably half the states we operated in. And we've slowly been getting that pushed through, you know, from a legislation standpoint to get – you know if it's if once you go get a boat if you get a new tag you pay sales tax if you haven't you don't prove that you paid it at a dealership and that way more trades are probably starting to come to us too so it's a little hard to really to gauge that but i i you know i agree with what anthony and jackbo said i do believe trades are up great that's that's helpful color um

Just switching gears a little bit, I mean, you called out higher F&I penetration, mitigating some of the margin pressure from working down inventory. Maybe let's dig into that a little bit.

What's driving that, and is it something that's sustainable, you know, through the balance of the year?

Yeah, it's definitely, you know, again, it's a concerted effort by the team. I think it's one of those areas if you're not pushing as hard as you can to get that finance, you won't get it. And so I think the team executed on some strategies. We had some price points and some special finance options for some of those discontinued brands that helped kind of drive a little bit. But we'll continue to be very competitive in the F&I department, kind of looking to expand and increase our penetration and increase our income there.

Great. And then I think that I just want to touch on the M&A pipeline. I think you called it active. Maybe frame a little bit more what that looks like today.

Yeah, we're in no hurry to do anything right now. I mean, every day, time works in our favor. And I think we're being cautious, kind of waiting to see how things pan out over the next 30, 90 days, getting into the season. There's a lot of dealers out there that it's been a hard winter for them. And, you know, we just kind of wait and see, you know, how numbers react and how they come down and what they look like going into the selling season compared to a year ago, especially since most of the deals that we buy are on a trailing 12. Just going to be very selective and be a little bit disciplined on timing right now and just wait for stuff to kind of fall in our lap.

Great. Thanks, guys. That's all for me.

Again, if you would like to ask the question, please press star 1 on your telephone keypad. Our next question comes from the line of Brian Griffin from Day 8 of Davidson. Your line is open.

Yeah, thanks, guys. Good morning. So what have you guys been seeing from a promotional aspect of these shows so far? I'm assuming it's still competitive, but maybe just some high-level comments on what you've seen so far by category and maybe other dealers.

I think it's been, you know, Anthony, you know what they did at the Atlanta Boat Show and what we've been doing at the boat shows, but I think it's been pretty much steady Eddie, you know, for the last year. I mean, manufacturers are still being very supportive, you know, moving inventory. They know they've got to be out there helping, especially pushing this dated inventory through. And I think they're all still doing that basically on the same level that they had been. And that's why, you know, we weren't expecting a whole lot last quarter. or this past fall because there was really no incentive to buy in October when you could buy in January at the boat shows and still be ready for the boat show season. I think it's just been pretty much on par with what it's been like over the last year, year and a half of promotion. I think manufacturers are very committed to helping retail clean up the field inventory because that benefits us all moving forward.

I think it's been across the board, Austin. It our competitors, manufacturers, all of them are digging in with everybody. So I don't see it slowing down at this point. But they are all very helpful to help facilitate putting deals together.

Gotcha. And what are you guys hearing from OEMs on potential tariffs and how that may impact demand and margins overall?

Well, I mean, you know, we...

Go ahead, Jack. I think a lot of them have a wait-and-see sort of standpoint. I mean, I think there's too much noise around exactly what things look like to try to do anything to prepare or to counteract. And I know over the course of time, a number of manufacturers have worked to diversify their sources of product. But a lot of products are manufactured in the United States, which certainly helps But I think it just kind of remains to be seen on that.

I don't want to say it's not impactful or meaningful or say that it's going to have no effect at all, because it will, depending on where the tariffs are and what they're on. But if you look at a boat, whether you're looking at a pontoon boat, a ski boat, or center console fishing boat, or a runabout, the majority of that pricing is in the engine. And in the raw materials to make the boat, the aluminum, the fiberglass, all that stuff, that's where the majority of your pricing is. So it's just not like we're going to see a 20% tariffs on, you know, all this stuff from all these different countries and all of a sudden boats are going to go up 20% because all the materials to build it went up 20%. It's just not a big enough piece of the boat to me where it's going to have that big of an impact.

I mean, and hell, they're already so daggum expensive now and it doesn't seem to be bothering people.

Understood. Thanks, guys. Thanks.

There are no further questions at this time.

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