This conference call transcript was computer generated and almost certianly contains errors. This transcript is provided for information purposes only.EarningsCall, LLC makes no representation about the accuracy of the aforementioned transcript, and you are cautioned not to place undue reliance on the information provided by the transcript.
Operator
Thank you for standing by, and welcome to the Qualys Inc. second quarter 2021 investor call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session, and instructions will follow at that time. If anyone should require assistance during the conference, please press star zero on your touch-tone telephone. I would like to turn the conference over to your host, Mr. Blair King. Please go ahead, sir.
Blair King
Thank you, Grace. Good afternoon, and welcome to Qualys' second quarter 2021 earnings call. Joining me today to discuss our results are Sumit Thakkar, our president and CEO, and Jumi Kim, our CFO. Before we get started, I would like to remind you that our remarks today will include forward-looking statements that generally relate to future events or future financial or operating performance. Actual results may differ materially from these statements. Factors that could cause results to differ materially are set forth in today's press release and in our filings with the SEC, including our latest Form 10-Q and 10-K. Any forward-looking statements that we make on this call are based on assumptions as of today, and we undertake no obligation to update these statements as a result of new information or future events. During this call, we will present both GAAP and non-GAAP financial measures. The reconciliation of GAAP to non-GAAP measures is included in today's earnings press release. And as a reminder, the press release prepared remarks and investor presentation are available on the investor relations section of our website. So with that, I'd like to turn the call now over to Sumedh. Sumedh?
Grace
Thank you, Blair, and welcome, everyone, to our second quarter earnings call. Q2 was another solid quarter with more customers upgrading to VMDR and increasing the deployment of our cloud agents on endpoints. We're delighted to share that we have continued to grow and operate effectively through the pandemic and management changes in the companies. Faced with the latest increase in malware and ransomware cyber attacks paired with heightened government scrutiny, our customers are turning to us to fortify their security posture, respond faster, and integrate patching and reduce legacy IT costs. Our highly scalable cloud-based platform allow enterprises to deploy multiple applications using a single agent, which differentiates us in the industry. Furthermore, our scalable platform enables us to handle more than 20 petabytes of data currently indexing over nine trillion data points on our Elasticsearch clusters, moving more than 28 billion messages a day on our Kafka bus, and pumping over one million writes per second on our Cassandra clusters. As a result, our solutions don't need to rely on collecting data from disparate point products to detect, remediate, and respond to security threats. The single agent approach provides better security and user experiences, and in turn underpins the continued acceleration of our cloud agent subscriptions, which grew 51% year-over-year to 64 million. We continue to expand the ubiquity of our agent with our VMDR solution, which continues to gain traction in the market with 28% customer penetration as of Q2. Additionally, validating our solution consolidation approach, our top new customers in Q2 not only purchased VMDR, but also started with a number of additional Qualys solutions out of the gate, such as asset management, patch management, multi-vector EDR, file integrity monitoring, policy compliance, web application scanning, and container security. We expect to further drive the VMDR adoption in the SMB segment with the new pricing and packaging we recently introduced, and given the desire of these smaller, resource-strapped customers to have a single risk-based vulnerability management tool with built-in remediation. We recently announced the launch of a very strategic initiative, which is our cybersecurity asset management, CSAM application. Accurate and up-to-date asset management in the continuously changing hybrid environment remains a major challenge for large and small businesses. Despite this, being a fundamental building block and compliance requirement, organizations struggle with asset management that is focused on cybersecurity. We believe that Qualys Cloud Platform, with our multiple sensors and scalable backend that collects, correlates, enriches, and categorizes large amounts of data, provides the ideal and robust solution for this challenge. By combining agent-based and agent-less data collection, active and passive scanning, and APIs, the Qualys Cloud Platform now provides comprehensive asset discovery across the entire infrastructure, including on-prem cloud container OT and IoT to add context for security-centric visibility with detection of security gaps, CMDB integration, alerting and response capabilities. It was particularly encouraging to see a top-tier financial institution select our CSAM application just days after its introduction in pursuit of agent consolidation, simplified operational workflows and a comprehensive view of the financial institution's IT asset infrastructure as it rebuilds the security architecture for the modern hybrid work environment. Exhibited virtually at Black Hat, we were pleased to see an overwhelming reception for this application by large enterprise customers worldwide. We continue to see customer interest in reducing agent sprawl with a single solution for risk management and threat response. So as an example, in Q2, A new Fortune 100 customer purchased VMDR policy compliance, patch management, cloud security, web application scanning, and container security together to standardize its security hygiene on a single agent solution over multiple best-of-three-point solutions. In terms of our other newer paid solutions, we saw continued customer interest in our container security solution as well as patch management application. In the quarter, several large new and existing enterprise customers selected our patch management application over competing solutions, given its ability to quickly patch remote endpoints easily and effectively without using the limited bandwidth available on VPN gateways. And finally, we are receiving positive customer feedback and support for our EDR solution. This application is a natural extension to our highly scalable cloud platform and strategically aligns our vision of a single agent. Looking into the remainder of 2021, we plan to introduce XDR, which is our extended detection and response and next generation security analytics and incident response solution, which natively integrates and correlates security telemetry across the security stack for an end-to-end platform and like EDR, another natural extension to our platform. This solution is currently in private beta with several design partner customers and the feedback we are getting has been very encouraging. As the adoption of cloud applications continues to proliferate in the industry, we continue to focus on enhancing our cloud-native security solutions. We are rapidly expanding the power of our platform through organic innovation and targeted acquisitions in this area. The total cloud acquisition we announced today will soon be integrated into several of our cloud platform modules, including our CloudView application and upcoming XDR solution to strengthen our cloud security posture management capability and enable users to easily create automated cloud workflows for rapid navigation. In addition, as I outlined on our last earnings call, another key area of focus for me is on our go-to-market strategy and sales execution. Here we continue to make appropriate investments in our business, and I'm pleased to say Alan Peters, who recently joined Qualys as our new CRO, is off to a great start. It's great to have him as part of the team, and we're looking forward to continuing our growth momentum under his leadership. In summary, we believe Qualys has a superior competitive position that provides a runway for long-term revenue growth and profitability while supporting industry-leading performance, ease of adoption for our customers, and speed of innovation for our R&D efforts, paired with the investments we are making in our go-to-market and sales enablement activities. We view these advantages as a major contributor to an already favorable competitive environment that the company has benefited from in replacing legacy point product deployments. With that, I will turn the call over to Juni to discuss our second quarter financial results and guidance for third quarter and full year 2021.
Blair
Thank you, Nat, and good afternoon. Before I start, I'd like to note that except for revenue, all financial figures are non-GAAP and growth rates are based on comparisons to the prior year period from the stated otherwise. We're pleased to record another quarter of consistent growth and profitability reflected in the following financial and operational highlights. Revenues for the second quarter of 2021 grew 12% to $99.7 million. As a reminder, Last quarter, our calculated current billings were negatively impacted, and this was expected to reverse this quarter to have a positive impact on Q2 2021 calculated current billing. As of Q2, LTM calculated current billing growth was 13%. Paid cloud agent subscriptions increased to $64 million over the last 12 months, up from $61 million for the 12-month period ended in Q1 2021, and 47% of non-strategic alliance customers with their vulnerability management solution up for renewal in the quarter purchased BMDR, up from 34% last quarter. We're excited by the continued adoption of BMDR, with the total customer penetration now at 28%. Our scalable platform model continues to drive superior margins and generate significant cash flow. Adjusted EBITDA for the second quarter of 2021 was 46.7 million, representing a 47% margin versus 48% last year. Non-GAAP EPS for the second quarter of 2021 was 79 cents, up from 74 cents last year. And our free cash flow for the second quarter of 2021 was 47.7 million, representing a 48% margin versus 28% last year. Year-to-date free cash flow margin was 51%. versus 40% for the same period last year. In Q2, we continued to invest the cash we generated from operations back into QALYS, including $6.7 million in capital expenditures and $32.2 million to repurchase 316,000 of our outstanding shares. The weighted average diluted shares outstanding in Q2 was $40.1 million, down from $40.9 million last year. We remain confident in our business model and feel that we're well positioned to drive growth given the traction we're seeing in newer solutions and the overall business momentum. We are delighted to be raising our full year 2021 guidance for both revenues and earnings. We're raising the bottom and top end of our revenue guidance for the full year to now be in the range of $406 to $407.5 million from the prior range of $402.5 to $404.5 million. We are raising our four-year non-GAAP EPS guidance to now be in the range of 3.02 to 3.07, from the prior range of 2.67 to 2.72. And for the third quarter, we expect revenue to be in the range of 103.8 million to 104.4 million, which represents a growth rate of 12%. We expect non-GAAP EPS to be in the range of 78 to 80 cents. C3 capital expenditures are expected to be in the range of $6 million to $7 million. With that, Sumedh and I are happy to answer any of your questions.
Operator
All right. Ladies and gentlemen, if you have a question at this time, please press star then the number one key on your touchtone telephone. If your question has been answered or you wish to remove yourself from the queue, please press the pound key. Your first question comes from the line of Hamza Foderala from Morgan Stanley. Your line is open, sir.
Alan
Hi, everyone. This is Calvin on for Hamza. Thanks again for taking my question. I think first I'd like to start out with, you know, Alan Peters is now three months into the role. Have you seen or do you anticipate any further kind of productivity improvements? And I know last quarter you mentioned sales enablement and new business as a focus. Can you tell us how much progress you've made there?
Grace
Yeah, I mean, as Alan has come on, we have been working together on figuring out what are the right investments that we need to make. And working with Alan, we have continued to focus on sales enablement, productivity in terms of process improvements, prospecting, bringing on more solution architects. And you can see some of the early indications of that in our guidance that we have provided. These are the things that we're working on, and as we continue to focus the right investments, we'll be making those through the rest of the year.
Alan
Awesome. Thank you for the additional color. And then for my second question, can you kind of talk a little bit more about the recently announced partnership with DeepWatch and what that kind of means for the company and potential go-to-market motion?
Grace
Yeah. We've talked about this in the past that as more and more managed service providers are looking to modernize their platforms, they want to be able to get the benefit of being able to provide tools where they can provide their expertise on top of the platforms which they have been building themselves, which obviously have not been able to keep fully on top of the changing and evolving cybersecurity posture. And that's what qualifies the advantage that for these managed service providers as they look at focusing more on using a platform that already provides them a lot of the security context, whether it's asset information, vulnerability assessment from the risk mitigation perspective, providing tech intelligence, MSSPs like DeepWatch, which we signed a partnership with and we look forward to working with them. We are looking to leverage more Qualys capabilities so that they can consolidate their own stack and then focus the resources on providing security their customers with security expertise rather than spending the resources on trying to build these disparate point solutions into their own stack so that they can provide this visibility. So from a go-to-market perspective, we're going to be working together as they will be taking us to their existing customers as well to leverage Qualys as their core solution from a vulnerability management perspective as they continue to bring on more sort of security, automation-focused customers on their platform.
Alan
Awesome. Thank you very much.
Operator
Thank you. And your next question comes from the line of Brian Sacks from Goldman Sachs. Your line is open, sir.
Brian Sacks
Hey, thank you for taking the question. This is Hannah Velasquez on for Brian Essex. Just following up on that previous question, or the first one rather, can you give us an idea of how much you plan to grow sales and marketing headcount this year, perhaps maybe quota bearing reps in particular? Thank you.
Blair
Yeah, so last year we ended the year with sales and marketing headcount approximately in the 300. We haven't disclosed the quota carrying reps headcount. And with Alan Peters on board, and we are planning to onboard a new CMO later this month, we will be reassessing kind of the right profiles and the team members to add to the team. So although we don't have a specific number target, we are planning to expand our sales and marketing professionals and grow that team. Okay, thank you.
Brian Sacks
And then I guess there's another follow-up there. So S&M grew about 17% in the quarter, year over year. This quarter, do you plan to follow a similar trajectory after the past, I don't know, three or four quarters of declines in growth?
Blair
We are planning to increase our investment in sales and marketing. With that said, in terms of the timing of when that investment will actually translate into our P&L and the impact on margins, it's a little bit difficult to say exactly Since Alan is still very much new, and we do have other executives, including not just the CMO, but also the CIO that we are looking for, and so with Sumed at the helm in his new position as a CEO, we are planning to work very closely together as an executive team to figure out when is the right timing and what is the right amount to invest this year and then continue on next year. With that said, one of the things that we are very optimistic about is the current trend in the business momentum. As you can see, you know, On the revenue guidance, we've always said that the trajectory of our annual revenue guidance is the best proxy for the business momentum. And you can see that with our annual revenue guidance now increasing to 12% year-over-year growth, and our current quarter at 12% growth, next quarter we're guiding to 12%. And what that implies is Q4 will also be 12%. You can see kind of with current billing increasing at a faster rate than revenue, we're very optimistic about the potential reacceleration in bookings. Okay, got it. Thank you.
Operator
Thank you. Our next question comes from the line of Ewan Kim from Loop Capital Market. Your line is open.
Qualys
Thank you. Congrats on a solid quarter, Sumesh and Juby. Sumesh, I mean, I'm sorry, Smed, strong VMDR upgrade rate for the quarter. Can you just talk about whether there was much of an uplift that you're seeing in terms of the overall multi-product adoption when someone's upgrading to VMDR and any kind of uplift that you're seeing in the overall deal size when a customer upgrades to VMDR? Sure.
Grace
So I think VMDR enables a lot of additional capabilities for the customer, and it does take some time for them to absorb those as part of their environment to operationalize those. But what we do see, you know, kind of in some of the examples out there is those who are looking at VMDR are also looking at asset management, so cybersecurity asset management. They are looking at patching in some way or the other. They're looking at file integrity monitoring. So we... As I mentioned in the call, our new customers, as you're bringing on board, they look at VMDR. They are also purchasing these additional solutions as part of that. And so we kind of see that interest and that traction from not just looking at VM, but actually starting to look at the broader portfolio, even for customers who are bringing straight off the bat when you bring them new on board, they are actually looking at multiple different capabilities. And I think that's definitely encouraging for us to see. And then with the existing customers, we continue to work with them now as they get the agents and they're deploying the agents and they operationalize those agents in the existing environment. That does potentially open us up for opportunity to go and start to deploy patch management, EDR, and other solutions. So we do see that in some of the examples that we mentioned in the call earlier as well.
Qualys
Okay, that's good to hear. Sumedh, you mentioned MSPs in your earnings press release. Can you just update us on your traction in the MSP market?
Grace
So I mean, we do that. Yeah, yeah. We see that, you know, the reason why they are looking at Qualys and why they are leveraging Qualys is because they see that with a single platform, they can get 5, 10, 15 different pieces of security information that they need to provide services to their customers. So as we work with them, we get these partnerships onboarded. There's going to be a time that they work through to getting Qualys ingested as part of their platform, build services around that. And so today what we see as we work through with them is that there is definite interest and potential, and we're working with some of these managed service providers that we recently signed up to get us integrated into their stack, so that way they can take us much more seamlessly into their customer base and provide additional services around that. And that's kind of where we are right now. And as we move forward, we expect to see that there will be more traction from the managed service providers.
Qualys
Okay, great. Good to hear. Sumi, our favorite question for you, can you at least qualitatively talk about any ASP increase in the quarter? Sure.
Blair
Yeah, so what we've historically shared was if you take a look at the average deal size, and we've shared the last quarter, it grew 9% year-over-year. But, of course, that does tend to fluctuate, and so it's not really indicative of how our customers are really faring with us. However, in Q2, that percentage was 17% year-over-year. So, obviously, that's positive. But because we didn't think that it was that meaningful or indicative, we decided to not include it in the earnings script this time.
Qualys
Okay. And then just lastly, international revenue growth came in very strong. How much of that was FX driven?
Blair
Some, but FX impact as a whole for our business is not that huge. It's because we hedge both revenues and expenses.
Qualys
Okay. Great. Thank you so much.
Blair
Thank you.
Operator
I think your next question comes from the line of Mike Sykos from Needham & Co. Your line is open.
Mike Sykos
Hey, guys. You have Mike Sykos on the line here from Needham & Co. Just had a question for you. If I'm thinking about the guidance and the results you guys just put up in Q2 here, it looks like most of this upside is coming from lower than expected OPX. And I'm trying to determine, I guess, should we anticipate a larger ramp as we look out to calendar 22? Are you behind in that? in any of your expenditures, whether it's ramping sales force or hiring engineers for your R&D team. Can you help us think about those different expense pockets?
Blair
I'm happy to. So I assume that earlier this year when we had first set out and shared the annual review guidance as well as the EPS guidance, things were a little bit different. We are going through some change in management, including with Sumad, who's been with us for decades. but obviously he's in a new role as a CEO. And Alan, the CRO, we haven't had a CRO before, and he joined for the first time this year, and that's been fairly recent. Our new CMO, who will be joining later this month. And so with that said, the timing of investment has been a little bit pushed out, and as we're working together as a team, we're not exactly sure in terms of when that will translate into actual P&L impact and the margin contractions. So I think it is fair to say that some of the investments that we were planning to make this year have been pushed out to next year. But also keep in mind that we are seeing the business momentum and turnaround on bookings kind of indicated by our current billings growth, even without a significant investment in expenses, whether it be sales and marketing or R&D or G&A or cost of revenue for that matter. And so we don't see that changing, but I think it is fair to say that next year will continue to be an investment year for us.
Mike Sykos
Understood. Okay. And then just two other questions, if I could. The first on your VMDR uptake, I think the adoption that you guys cited was 47%, which I know is above the mid-30s that you guys were running in recent quarters. And so the first question on VMDR, can you help us understand what's driving the improved adoption rates there? And then the second item, I know it's still early days. You're in beta with a few customers on your XDR solution. But if I'm just thinking about the overall XDR market, it seems like there are real players there. and I'm just wondering how you guys anticipate differentiating your solution or more effectively competing there versus some of the other vendors.
Blair
So with respect to VMDR, let me address that first. So what we have said, the penetration rate that we've been disclosing previously was percentage of VM customers that are up for renewal in this specific quarter just because we launched VMDR at the end of Q1 last year. So what we were focused on is take a look at VM customers that are up for renewal in that specific quarter and see which quarter or which subset of customers it makes sense for them to early adopt VMDR. So that percentage we knew would fluctuate from quarter to quarter. So that percentage being 34%, slightly lower than I know that some people were expecting, and then 47%, which is higher than I'm sure that some people were expecting. It wasn't necessarily a surprise to us because it's really up to the customer. And this is actually one of the reasons. What that's kind of Hitting that first full quarter of EMDR, we did disclose that percentage customer penetration, which is 28%. So 28% is slightly different because that's out of the total number of paid customers that we have. And that has been also trending up, which has been a meaningful metric for us to track. And that was last quarter 24%. Now it's up to 28%.
Grace
And I will add to that, the VMDR adoption definitely is good this quarter, and we were quite happy with the way it's trending. It's been a combination of, obviously, as the VMDR has been out there for a year, customers who are coming up for renewal, they're seeing the success of it. They are being able to see that as they talk to other folks in the industry who have used VM. Some of the ransomware attacks and malware attacks that we're seeing are pushing more towards... how do you get remediation much faster, and VMDR is very unique from that perspective, is that it combines that ability to get quick remediation done, and that combined with some of the packaging changes also that we are doing from an SMB perspective, so it's been a focus for us as we combined a combination of a few different things as we are pushing to get that adoption going up, but mostly it's really just customers seeing the value and as they are budgeting or their renewals are coming up. They're budgeting for the upsells that are required for VMDR. And we hope to continue to see this moving forward from a VMDR adoption perspective. And then I would say on the XDR side, we're getting positive feedback from our current customers. And I think the biggest differentiator for us is, unlike a lot of the XDR vendors, which are some variation of a SIEM, Those platforms typically do require a lot of the telemetry and the data collection to be done by the other solutions that the customer has to deploy and pipe them into the EDR solution. And that's where we see ourselves as customers are deploying a single quality agent and collecting all the data about inventory, about vulnerabilities, about EDR, about file integrity, in cloud containers, information about non... IT assets where you cannot have an agent as we do a lot of scanning. So IOD devices, being able to get printers, all kinds of different infrastructure information into the platform. That's different because all of that is already collected by Qualys. And now we're just taking some additional data points from Firewall and a few other solutions to bring their additional context versus what we see otherwise for the most part is HDR solutions they have data collection capability for maybe one aspect, but then they still require customers to deploy multiple other solutions so that they can take the log data from those solutions into there. And that's really the big differentiator that we see as we will be going to market those customers as they continue to standardize on multiple solutions from Qualys for them being able to enable XDR in the same platform and see the value quickly should be much quicker than them having to try to deploy some sort of other SIM solution.
Mike Sykos
Great. Thank you, guys.
Operator
Thank you. And your next question comes from the line of Jonathan Roy Caver from Bayer. Your line is open, sir.
Qualys
Yeah. Hi. Good afternoon. Sumed, I'm wondering if you can talk about the demand trends around vulnerability management, particularly in light of the constant barrage of announcements regarding known vulnerabilities. And have you seen an uptick in, I guess, volumes in scope of scanning within enterprise customers? And if so, does that lend itself to expansion opportunities at renewal, or is that not the case?
Grace
Yeah, I think there's multiple different things happening. That's a great question. And I think what we see right now is everybody is surprised with ransomware attacks, right? So organizations, they're surprised. And the reason they're surprised is while they've always owned that asset, they've had that asset, they have not had visibility in the way that they would apply. So either they didn't know the asset was there, didn't have the inventory of that asset, or they were not clear that these assets had vulnerabilities, or they were not prioritized properly, or if they were, then they were not patched properly. And so I think that's the big reason why the risk is being evaluated a lot. We are having a lot of conversations with our customers as they're looking to say, how do I get that visibility so I can be ahead and try to fix these issues before the attackers are getting that visibility, right? And so these conversations, but what it does lead to is more of a holistic conversation and not just a knee-jerk reaction of, you know, should I just buy more of this or more of that? What they are looking at is with VMDR, with CSAM, how is Qualys and with patch management combined how does that provide them much better visibility into being on top of their assets, their end of life, their vulnerabilities that are being attacked actively, prioritizing those, being able to patch them much quicker than traditional IT setup where you have to go through multiple tools and teams, and re-architect their VM programs to be a lot more automated, a lot more nimble, and those conversations we do see are happening, and that, obviously, in cases customers are ready to expand their scope with VMDR, with Qualys, either immediately in some cases, and again, we don't choose our customers, push them to do that. In some cases, they are working out on a new architecture that they are going to deploy over the next few months, and so they are getting more and understand, but like I said in that one of the examples, that new customers that are coming onto Qualys, they are getting VMDR, CSAN, EDR, a few of those right off the bat. So we do see that as they are looking, customers are looking at getting a new solution, a new architecture, they are buying a few things from Qualys right off the bat because they see the value of having all of that in a single platform.
Qualys
Okay. So you're seeing the opportunity to really drive a higher ACV because of the value in the broader platform, it sounds. Right. So the other question, so if you look at the U.S. growth, it's lagged international, I think, since the beginning of 2020. Can you just talk about the reasons for that relative difference? Is there anything specific around competition or execution that you would highlight?
Blair
No, nothing in particular. It's really driven by our sales reps and their ability to kind of penetrate and land new customers as well as expand our existing. And there is the law of smaller numbers with MENA textile being a smaller percentage of our total business versus America's, but nothing notable to highlight there.
Qualys
Just to clarify that, you're suggesting that it's more new customer growth that's driving the strength internationally? Yes.
Blair
No, no, it's both new and existing. So what I was highlighting is there's really, like, there's both a new renewal and upsell bookings that we see across the board, but nothing notable in terms of our competitive advantage or our positioning across different regions or territories. It has more to do with the fact that, you know, EMEA and AIPAC, I would say, compared to America, it's like U.S., it's still a pretty emerging countries or territories that we haven't really fully penetrated at this point, and there is a lot of smaller numbers there.
Grace
Yeah, and we're also seeing that, as in the U.S., large customers have very entrenched architecture over the years, so they are working to change that, move towards more modern architectures. You know, there's some of that lag we see at times between when they want to and when they can actually make it happen in the U.S. more so, whereas internationally they tend to have not so much of an entrenched legacy architecture and tend to sometimes be able to execute a little bit faster on some of these things. So it's a combination of different things that we see.
Qualys
Right. Understood. That's helpful, Collar. Thank you.
Operator
Thank you. I am showing no further question at this time. I would now like to turn the conference back to our CEO, Mr. Samet Thakkar, for any closing remarks. Sir?
Grace
All right. Thank you for attending our earnings call and your questions. We believe our integrated platform is very well positioned to respond to customers' increasing need to detect and remediate issues at an increasingly rapid pace. Looking ahead, we're focused on executing our strategy, encompassing continued innovation and advancing our go-to-market motions to re-accelerate growth while driving increased value for our customers and shareholders. Thank you again.
Operator
Thank you, ladies and gentlemen. This concludes today's conference call. Thank you all for joining.
Disclaimer