Wynn Resorts, Limited

Thank you all for holding for today's conference. Please continue to stand by and we will be starting today's call shortly. Again, please continue to stand by. Thank you. Thank you. Welcome to the Wynn Resorts third quarter 2022 earnings call. All participants are on a listen only until the question and answer session of today's conference. To ask a question, press star 1 on your touchtone phone, record your name, and I will introduce you. Please limit yourself to one question and one follow up question. This call is being recorded. If you have any objections, you may disconnect at this time. And I will now turn the line over to Julie Cameron Doe, Chief Financial Officer. Please go ahead.

Thank you, Operator, and good afternoon, everyone. On the call with me today are Craig Billings and Brian Gulbrantz in Las Vegas. Also on the line are Ian Cullen, Linda Chen, Frederick Luvisuto, and Jenny Holliday. I want to remind you that we may make forward-looking statements under safe harbor federal securities laws, and those statements may or may not come true. I will now turn the call over to Craig Billings.

Thanks, Julie. Afternoon, everyone, and thanks for joining us today. Before I get into the quarter, I'd like to thank the cast, crew, and producers of Awakening, our new show at WIN Las Vegas, which successfully opened on Monday. The show is yet another example of our willingness to innovate and push the envelope to drive the strip forward. I'm incredibly proud of the team behind the show. A kickoff in Las Vegas, where the team turned in a third quarter record with 196 million of EBITDA, or approximately 207 million adjusted for lower than normal holds. We saw broad-based strength across casino, hotel, food and beverage, and retail, all well above third quarter 2021 levels, despite the difficult year-over-year comps. The comparison to third quarter 2019 is even more impressive, with our EBITDA more than doubling on a 36% increase in revenue. Our investment in people, facilities, and programming, and our team's deep sense of ownership continue to elevate Wind Las Vegas above our peers. This quarter once again highlights the benefit of that deliberate investment strategy. Looking ahead, we're encouraged that the strength we have experienced over the past several quarters has continued into the fourth quarter. In fact, our EBITDA during October was an all-time monthly record for the property. Similarly, our forward-looking indicators also remain quite strong despite well-known macro concerns, as room bookings are pacing at or above pre-COVID levels on substantially higher ADRs. Near term, we expect the normal seasonal pattern to hold during the remainder of Q4, with some of the usual softness surrounding Thanksgiving, followed by a strong close to the year in the latter half of December. Turning to Boston, like Vegas, Encore had a strong quarter, generating $61 million of EBITDA. We saw strength across the casino with record gross gaming revenue and on the non-gaming side with record hotel revenue driven by strength in both ADR and occupancy. These trends have continued into Q4 with EBITDA per day in October consistent with the third quarter levels. Looking ahead, we remain excited about sports betting in the Commonwealth, which is expected to kick off early next year. Our retail sports book there will soon be a significant opportunity for customer acquisition. We also continue to finalize our plans for our upcoming development project across the street from the property that will add incremental parking, food and beverage, and entertainment amenities. In Macau, the market continues to be challenging with market-wide GGR in the third quarter only reaching approximately 8% of the third quarter of 2019 levels, and our results have reflected that. Our team has done a fantastic job controlling costs in a very challenging operating environment through a combination of decreases in payroll and fixed OPEX. As a result, despite the nearly two-week closure of casinos in the market in July, our overall EBITDA loss in the third quarter was $66 million, which was a meaningful improvement from a loss of $90 million in the second quarter, even after adjusting for a $7 million bad debt credit that benefited the results in the third quarter. More recently, we did see some encouraging pockets of demand during the October holiday period, particularly in our direct VIP business where turnover was actually slightly above the comparable 2019 holiday period, and in our retail business where tenant sales reached 74% of 2019 levels. This once again highlights the strong demand for Macau's unique tourism offering during periods when the market is accessible. The authorities in Macau continue to advance the concession process according to the pre-established timeline. We were pleased to submit our concession tender application in September, and the government is currently reviewing the proposals with decisions expected to be made by year-end. Long-term, we remain excited about the prospects from Macau with so much pent-up demand for travel and tourism in Asia. At Wynn Interactive, our overall EBITDA burn rate declined to $18 million in Q3 from $21 million in the second quarter of 2022, on the back of strong cost controls and improved marketing efficiency. We are looking forward to the potential for a significant catalyst for WinVet in Massachusetts. Lastly, we're advancing quickly on our planning for WinMarjan, our integrated resort in the UAE. We're in the late stages of programming for the resort. Given the pristine beach setting and the somewhat malleable nature of a man-made island, we have an incredible canvas with which to work and design something truly unique. I expect we will share renderings, programming, and plans more publicly in early 2023. I also expect we will be driving piles for the foundation of the property by the middle of next year. We look forward to sharing more details with you about this exciting project in due course. With that, I'll turn it back to Julie to run through some additional details on the quarter.

Thank you, Craig. At Wynn Las Vegas, we generated a third quarter record of $195.8 million in adjusted property EBITDA on $544.4 million of operating revenue during the quarter. Lower than normal hold negatively impacted EBITDA by around $12 million in Q3. Our hotel occupancy was 88.8% in the quarter, up 580 basis points year over year, and up 90 basis points versus Q3 2019. Importantly, we've stayed true to our luxury brand and continue to compete on quality of product and service experience. With our overall ADR, reaching $426 during Q3 2022, up 8.7% versus Q3 2021, and 39% above Q3 2019 levels. Our other non-gaming businesses saw broad-based strength across food and beverage and retail, which were up nicely year over year, and also well above pre-pandemic levels. In the casino, our Q3 2022 slot handle increased 31.6% year over year, and was 72.2% above Q3 2019 levels. Similarly, our table drop was up 12.5% year over year and was 32.4% above Q3 2019 levels, despite still suppressed international play during the quarter due to COVID-related travel challenges. The team in Vegas has done a great job of controlling costs without negatively impacting the guest experience, delivering adjusted property EBITDA margin of 36% in the quarter. On a whole normalized basis, our EBITDA margin was up approximately 1,300 basis points compared to Q3 2019. OPEX, excluding gaming tax per day, was $3.6 million in Q3 2022, up 10% compared to Q3 2019 levels, but well below the 36% increase in revenue due to lower headcount and broad-based cost efficiencies in areas that do not impact the guest experience. We remain committed to maintaining a cost structure that appropriately balances margins and our exacting service standards. In Boston, we generated adjusted property EBITDA of $61.1 million in Q3 2022, with EBITDA margin of 28.9%. We saw broad-based strength across casino and non-gaming during the quarter. In the casino, we generated $184 million of GGR, a property record, with strength in both tables and slots. Our non-gaming revenue grew 33% year over year with particular strength in the hotel, driven by 97% occupancy and a $398 ADR. We stayed very disciplined on the cost side with OPEX excluding gaming tax per day of approximately $1.1 million in Q3 2022. This was a decrease of over 10% compared to $1.3 million per day in Q4 2019, and broadly in line with Q2 2022. As we've discussed on prior calls, the year-over-year EBITDA and OPEX comps were impacted by a combination of contractual labour agreements, which added around $45,000 per day to our OPEX base, beginning late in Q2 2022, along with a one-time benefit of $3 million in Q3 of last year. We're well-positioned to drive strong operating leverage as we continue to grow the top line over time. Our Macau operations delivered an EBITDA loss of $65.6 million in the quarter on $115.6 million of operating revenue as the COVID situation in the region has continued to suppress visitation. As Craig noted, while the businesses remain challenging, we experienced some encouraging pockets of demand during the October Golden Week holiday period. particularly in our direct VIP and retail businesses. Our OPEX, excluding gaming tax, was approximately $1.6 million per day in Q3, a sequential decrease compared to $1.9 million per day in Q2 2022. The team has done a great job remaining disciplined on costs in a difficult operating environment. Longer term, we're well positioned to drive strong operating leverage as the business recovers over time. Turning to Win Interactive, Our EBITDA burn rate improved to $17.7 million in Q3 2022, from $21 million in Q2 2022, primarily driven by improved marketing efficiency and disciplined OPEX control. Moving on to the balance sheet, our liquidity position remains very strong, with global cash and revolver availability of approximately $2.8 billion as of September 30th. This was comprised of $997 million of total cash and available liquidity in Macau and $1.8 billion in the U.S. These numbers exclude the undrawn $500 million intercompany revolving credit facility Wynn Resorts entered into with Wynn Macau. Our previously announced sale and leaseback transaction for the real estate of Encore Boston Harbor remains on track to close before the end of the year. Proforma for the transaction, we have approximately $4.4 billion of consolidated global cash and liquidity. Importantly, the combination of very strong performance in Las Vegas and Boston with the properties generating trailing 12-month EBITDA of over $1 billion, together with our robust liquidity, creates a very healthy Proforma leverage profile in the U.S. Finally, our capex in the quarter was $87 million, primarily related to the Awakening Theater at Wynn Las Vegas and normal course maintenance. With that, we will now open up the call to Q&A.

Thank you. At this time, if you would like to ask a question, please press star 1 on your touchtone phone, unmute your phone, record your name clearly after the prompt, and I will introduce you for your question. please limit yourself to one question and one follow-up question. To withdraw your question, press star two. Our first question comes from Carlo Santorelli with Deutsche Bank. You may go ahead.

Hey, Craig. Hey, Julie. Thanks, everyone, for your comments. Guys, I just wanted to kind of talk a little bit about what both of you mentioned as it pertained to the uptick that you're seeing in Macau. How much of that at this point Do you think you could perhaps, and I understand it's kind of direct VIP, so a smaller number of players could really move the needle, but how much of a change have you seen since the visa policies were tweaked a little bit? And with respect to the comments you made on non-gaming, is there potentially something that's kind of brewing that's swiftening the pace a little bit of the return of customers?

Hey, Carlo. Sure, I'll start, and then I'll ask Ian to comment. I think on the latter portion of your question, with Hong Kong being inaccessible, I think you've seen pretty reasonable retail sales in Macau, given it's more accessible than Hong Kong, and I think that's just a natural outcome of accessibility. With respect to the former part of your question, I mean, it's like squeezing air in a balloon, right? The demand has to go somewhere. And so we weren't surprised to see an uptick in direct VIP growth in light of the market having no junkets. So I don't think either one of them were surprising to us. We've seen it before over the course of the past year when there have been pockets of demand. Ian, would you add anything to that?

I'd just like to clarify that for e-visas, they haven't really gotten moving yet. They reopened on the 1st of November, so they wouldn't have had an effect on October activity. So the activity that we saw in our VIP area and premium mass is linked to a certain extent to returning former junket players. We also saw the Chinese New Year. So we believe it's our premium positioning in the market and the facility and services that we in the future.

Great. And while you're there, is it possible that we will hear something? I know you guys certainly said by year end as it pertains to the granting of the concessions. Is it possible that between here and there, seven, eight weeks away, that we will hear some contingent licenses being handed out?

Anything is possible. So, sorry, anything's possible, Carlo, but, you know, the pre-established timeline has been year-end.

Great. And then, Craig, while I have you, I know you mentioned a little bit of development on the UAE and obviously some groundbreak next year with more color in the first quarter of 13, but could you talk a little bit about, you know, the progress in your learnings maybe at this stage? Anything incremental you could share on that front?

Yeah, sure. I think I mentioned on a previous call that the more time we spend over there, and I was just over there recently, the more we believe in the non-gaming elements of that market. It's a tremendous non-gaming leisure and luxury market. And as I mentioned in my prepared remarks, we're in the pretty late stages now of programming, so essentially determining what we're going to build, not how it's going to look per se. Okay. And given that it's a man-made island without any existing development, it's an incredibly flexible location on which to plan. For example, if you want to move a beach, you move a beach. So it's a really exciting project, and we've sought to maximize the relationship of the facility to its surroundings, particularly in the non-gaming amenities like food and beverage and wellness, and really take advantage of such a unique location. Meanwhile, the casino component, where at least for some period of time we will be operating on our own, which makes it quite exciting, is shaping up to be somewhat larger than Wynn Las Vegas, but with numerous pockets of energy and compression. And so striking that balance is important. When you think about a market like that where you, for some period of time, will be the only operator, you certainly don't want to underbuild the casino, but you want to maintain that sense of energy. So I think the property is going to be a stunner, and we look forward to sharing more in early 2023.

Great. Thank you both.

Thanks. Thank you.

Thank you. The next question is from Joe Gruff with J.P. Morgan. You may go ahead.

Good afternoon, everyone. I was hoping you could talk about Las Vegas, Craig, and where that's going to be. a little bit different than how you and your STRIP peers have talked about trends up until recently, specifically about programming. Can you discuss maybe in this way that would be helpful as we try to ascertain the sustainability of currently strong trends? Can you talk about, you know, how many programming events do you have for the first half of next year versus the first half of this year if visibility stretches out for the full year of next year? And can you compare that to full year of 22? Is there a general rule of thumb relating to incremental revenues of an average programming event?

Sure. Look, I think this, Las Vegas has done programming for years in some form or fashion. And I think as we emerged from COVID, and we were in many cases a better location in terms of accessibility, openness, masks, et cetera, et cetera, then some of our adjacent markets, particularly California, I think the trend towards, uh, programming and the willingness of a higher value customer to pop over to Las Vegas for a particular event, uh, increased meaningfully. And so what I think, and by the way, at the same time, you obviously had a number of, uh, a number of sports teams that had emerged in Las Vegas, most notably the Raiders who drive a tremendous amount of visitation. And so I think in general, the town has become quite good at really looking at every weekend or every two weeks as an opportunity to program something. The journey for us, I think, is slightly different, right? We don't think of programming as purely transactional. Who are we going to plug into a particular theater on a particular day? For us, it's more holistic. How can we leverage all of the assets that we have in this building, including the golf course, which we've used to great success? with the match, with the recent Concorde Elegance car show that we drummed up and originated here. And so, you know, how do we use the property as a stage? We think about that all the time now. So I don't have a heuristic for you where I can quote to you X number of events per year because really we're focused on it every single week. But it certainly, it inures more than just revenue to the property, right? It inures it makes you the CNBC spot. And that's important because marketing is no longer about billboards and about television commercials. It's about content. And so we've been incredibly good at creating content, and it doesn't hurt that during the pandemic we continue to invest in this property and invest in our people. And so we're firing on every single cylinder here, and I think it shows in the numbers, and programming is a piece of it.

Great. Thank you. And then, Craig, my second question. relates to a topic that you might be limited in fully answering. We all saw Tillman's for filing, 13G filing last week. So my questions are, one, have you had any conversations with him? Obviously, you talk with investors and prospective shareholders all the time. Two, what has he communicated to you as the reason for his sizable stake and when? And three, can you share that? Thanks.

Well, I guess what I can say is kudos to him because he's done quite well since he appears to have started acquiring in the second quarter when the stock was excessively cheap. It's actually right around when we were buying back some stock as well that we reported in our second quarter Q. Based on what we've seen watching our share register, as we do constantly, sometime in Q2 we began seeing accumulations really by certain banks that have traditionally been associated with derivative transactions, like total return swaps, things like that. And we watched those banks establish positions in our stock, and we were well aware of them. All in all, I think it's just a great recognition of the value in our equity, but there's not much more to say beyond that.

Thank you.

Thanks, Joe.

Thank you. The next question is from Sean Kelly with Bank of America. You may go ahead.

Hi, good afternoon. Thank you for taking my questions. Craig, just wanted to go a little deeper on Las Vegas. We talked about sort of the top line side a little bit, the outlook there. Can we talk about sort of labor and OpEx trends? I think hold notwithstanding in the quarter, operating expenses were up a little bit. Can you just help us think about the puts, takes here as some of the non-gaming mix continues to come back, some of the group and banquet and catering stuff, the show comes in and has a bigger contribution. Can you help us think about sort of the balance of those as we move into next year and we're starting to lap a really strong margin and rate, average daily rate performance in 22? I'm sure there's a different impact for dollars than for margins. So maybe help us think about some of that as we look out next year.

Yeah, sure. I'll turn that one over to Brian.

Sure. Thanks, Sean. Our team has really been incredibly disciplined over this last year and even before that coming out of pandemic with respect to opex uh we've driven real strong revenues the even and even a margin uh as you can see has been quite strong and in comparison to uh you know q319 uh amazing performance so i think this has all been done by us really balancing the revenue and our cost base and most importantly our brand and really being conscious of that you know there's an impact from The seasonality of where we're at, our hold obviously was a little down this last quarter. In labor, being very well controlled by the team, and I think that we can continue to see margin expansion versus 19 at almost any given revenue level. But the team's really been balanced on focusing on the revenue, the cost base, and our brand, and we've seen great growth. As far as ADR, we've seen very little resistance. If you're following our rates, which I'm sure you are, we've leveraged as much, we've pushed as hard as we can, and kudos to our revenue team and sales team. They're absolutely crushing it. We're seeing incredible records on our side for ADRs, and that's not just on the transient side. We're seeing that in group across every segment.

And I would just add to that, as you know, Sean, we don't target margin in any particular quarter, right? We We target prudent management of our resources in order to deliver an experience that is consistent with the brand. We learned a lot during COVID, a lot. We are more nimble than we have ever been with respect to OpEx, and so we're running the business with less people. We're delivering on the brand promise as well as or better than we have historically, and that's how we manage the business.

Great, thanks. And for my follow-up, maybe for Ian, just obviously the e-visa channel did open, I believe, on November 1st. Has there been any notable change or anything you could just say about traffic levels? Because that's obviously a material area that has been shut down for a very long period of time at this point. And if not, are there some counterbalancing forces we need to be aware of? I know there have been a decent number of lockdowns and, you know, COVID outbreaks that also could have some impact here. So just what are you seeing on the ground?

So, Sean, we were very impressed with the government's reaction to the recent outbreak in Macau. When we had an outbreak in the summer and we had a casino closure, there was a six-week cycle of closure and recovery, and the government have managed to turn it around in two to give visas trickle in in the next couple of weeks and then pick up pace in the coming months.

Thank you very much.

Thanks, Sean.

Thank you. The next question is from David Katz with Jefferies. You may go ahead.

Hi, this is Cassandra. On behalf of David, thank you for taking my question. Can we talk about digital wagering? I think some operators Can you talk about October being close to breakeven or even positive? Can you provide any update or incremental clarity on when you think the business might turn profit?

Sure. So, look, in the long term, we think about this business, as I've said on prior calls, we think about it really over the longer term. And in particular, iCasino. where we've had pretty reasonable success and our brand has real currency. As we've said before, and I think we were the first to say so, what we aren't willing to do is burn billions of dollars between now and then, and we've done that. If you look at our results for Q3 year over year, we had almost the same total handle in both Q3 2022 and Q3 2021 on a 90% reduction in marketing spend and an 80% reduction in burns. because our initial customer cohorts continue to play with us, generating revenue, and we're being very thoughtful with respect to user acquisition and promos. With Massachusetts coming up, I would expect a modest uptick in UA, but nothing earth-shattering because we have a sizable database there, and we're highly likely to have retail sports betting without mobile for a while. So the goals at this point are to launch Massachusetts and, as you said, achieve breakeven, and then grow as the market does, particularly in iGaming, where, again, our brand has currency, and we can ultimately drive the best digital customers to win Las Vegas and encore Boston Harbor. So we're not calling the EBITDA break-even point yet, but, I mean, if you look at our numbers, we're getting pretty close.

Great. Thank you. And for the follow-up, has there been any updated thoughts on the excess land you have in Las Vegas? What are some kind of strategies that could activate the value there?

Look, we're focused. The type of design and development that we do, you can't spread yourself too thin. So we're very focused right now on the UAE and getting that right. It's a tremendous, very high return opportunity for us, we expect. And so that's really the sign of our, that's really the focus of our design and development efforts at the moment.

Got it. Thank you for taking my question.

Thank you.

Thank you. The next question is from Dan Pollitzer with Wells Fargo. You may go ahead.

Hey, good afternoon everyone. So in Las Vegas, You talked a little bit about the programming benefits and going forward, how we should be thinking about that. As you think about, along with that, the, you know, group and convention business coming back in the 2023 and the occupancy uplift, is it fair to give you guys that full five-point credit going forward, you know, starting next year, or is that something that's going to be phased in more gradually?

We don't, again, we don't really talk about forward guidance, so I can't translate it into basis points. What I would say in general is that you're right, the group and convention business during the earlier portion of this year was a little bit thinner or certainly concentrated in very specific pockets. And over the course of really the past month, month and a half or so, we've seen the business come back more fully. So that certainly is an occupancy tailwind, but quantifying it at this point, we don't do that.

Understood. And then in terms of capital allocation, you're set to receive the proceeds from the Encore Boston sale lease back in the fourth quarter. Does that change your thinking in terms of allocating capital or, you know, in terms of how much you're buying back in terms of stock or maybe even a special dividend?

Well, the recurring dividend is really the cornerstone of our strategy, and it always has been and certainly was pre-COVID. Our U.S. business is generating very, very healthy cash flow, and our high ROIC development project, UAE, the development we're doing adjacent to Boston, the press has reported that we're interested in New York. Those are well-funded, given particularly the cash infusion that you just referenced. The resumption of that recurring dividend really hinges on the recovery of McAllen. So I think it's a little too early to be talking about significant changes in capital allocation policy pending the return of Macau, which hopefully is over the next several quarters. So stay tuned.

All right. Thanks so much.

Thank you.

Thank you. The next question is from Robin Farley with UBS. You may go ahead.

Great, thanks. Can you kind of remind us what your interest level is in a potential New York site at this point?

Yeah, I mean, we, sure, Robin. So we are all about gateway cities, marquee developments, battleship assets. And so, yeah, we're always interested in locations like New York. The devil's in the details, of course, when it comes down to you know, to what the upfront license payment ends up being, what the tax rate ends up being, what the detailed regulations end up being. But, yeah, of course, we're interested in New York, as has been reported in the press.

But you wouldn't necessarily give any more detail in terms of, like, potential location or timing expectations?

I think it's been reported that we are working with Related, which is Hudson Yards.

Right. And anything in terms of your timing expectations?

Yes. It's really dependent on the process. The RFP has yet to drop.

Yes. Okay. Thank you.

Sure. Thank you, Operator. We'll take one last question.

Thank you. Our final question is from Brant Montour with Barclays. You may go ahead.

Hey. Good afternoon, everybody. Thanks for taking my questions. So, you know, your margin story was really, really good here this quarter, and you gave a stat on OPEX per day growth from 19 of up 10%. And I was curious if we could look at that number on a CAGR basis and sort of get any comfortability around your ability to manage to that growth rate or if, and I guess what I'm getting at is inflation picking up going to sort of impact that going forward.

Well, look, I'll, I'll take this one, Julie. So, uh, first you have to think back to our experience during COVID and kind of work forward. So as we emerged from COVID, we, uh, were forced actually, uh, to become much more disciplined in terms of how we looked at, uh, looked at costs. Now we have always delivered the best guest experience in the business. And the challenge that we had was making sure that we continue to do that. but frankly on a lower FTE count. And we've carried that on. So we're down FTEs relative to 19 even in this quarter and even in last quarter when we printed nearly $240 million in EBITDA. So when you look at our OPEX per day now, a lot of it is variable and directly related to revenue. To your point on inflation, inflation works two ways in our business, right? The price of a hotel room can be adjusted every minute of every day, And that's one of the benefits of a business like ours. And so we feel good about our ability to manage labor costs. Now, we have a portion of our business that's union, and that's true of everybody, well, all the major players other than one up and down the strip. And so that's an important consideration. But we're not staying up at night stewing about the cost of labor or options. And in fact, a vast majority or a large number of positions in our building are tipped. And, you know, folks that are tipped, where else do they want to work? They want to be here. So we feel great about our margins. Again, we don't manage quarter to quarter to a particular margin. We manage our FTEs with discipline, and we try to maximize the revenue and maximize our delivery on the brand promise.

Excellent. Thanks for that. And then just as a quick follow-up, When you talk to your internal sales folks who are, you know, on the phone every day with the planners at large corporate clients, you know, do you get the sense that there's any unevenness across different corporate sectors, i.e., tech, where people over there are sort of looking at 23 gatherings and things that we're thinking about planning and potentially hitting the pause button just given the macro?

Brian, you want to take that? Sure. Thanks, Greg. Brent, you know, I think something that's real telling from an industry standpoint is to really just look at the large city-wides. CES back in 2020 did over 170,000, and in 22 it did 44,000. So certainly that is an international component, a strong international component to that business, as well as in the tech industry. But then if you look at SEMA that just happened this last month, a couple weeks ago, They had over 130,000. So we're having the most solid year we've ever had. We are going to have our best year ever in group in both room nights and revenue, and we're pacing ahead of that for 23. And that's despite January and February having a real soft January and February with Omicron. So I think we're well positioned. There are certain industries that are performing better than others. And we're seeing that both at Wynn and across the city, I would assume.

We've been more than able to fade any minor fallout that we've seen from tech, mortgage, et cetera, et cetera.

Yeah, we've had a couple cancellations, but it's nothing out of the norm. In fact, it's kind of below what we would normally see. So I think we're quite comfortable with where we're pacing. We're pacing ahead of where we should be. And we are very encouraged by what we're seeing for 23.

Great color. Thanks so much.

With that, we will now close the call. Thank you, Operator, and thank you, everyone, for your interest. And we look forward to talking to you again next quarter.

Thank you. That does conclude today's conference. You may disconnect at this time.