GATX Corporation

Hello, and thank you for standing by. My name is Tiffany, and I will be your conference operator today. At this time, I would like to welcome everyone to the GATX 2026 first quarter earnings 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 would like to ask a question during that time, simply press star, then the number one on your telephone keypad. I would now like to turn the call over to Sherry Hellerman, Head of Investor Relations. Sherry, please go ahead.

Thank you, Tiffany. Good morning, and thank you for joining GATX Corporation's 2026 First Quarter Earnings Conference Call. I'm joined today by Bob Lyons, President and Chief Executive Officer. Tom Ellman, Executive Vice President and Chief Financial Officer. And Paul Hidderton, Executive Vice President and President of Rail North America. As a reminder, some of the information you'll hear during our discussion today will consist of forward-looking statements. Actual results or trends could differ materially from those statements or forecasts. For more information, please refer to the risk factors included in our earnings release and those discussed in GATX's Form 10-K for 2025 and our other filings for the SEC. GATX assumes no obligation to update or revise any forward-looking statements to reflect subsequent events or circumstances. Earlier today, GATX reported 2026 first quarter diluted earnings per share of 235. This compares to 2025 first quarter diluted earnings per share of 215. I'll briefly address each of our business segments. After that, we'll open the call up for questions. Despite heightened macroeconomic uncertainty, our businesses delivered results in line with expectations in the first quarter. At Rail North America, demand for rail cars in the existing fleet remained steady. As noted in the earnings release, starting this quarter, Rail North America metrics and statistics reflect the combined legacy fleet and the Wells Fargo fleet. At the end of the first quarter, Rail North America's fleet utilization was 98.1%. This was consistent with our expectations given the inclusion of the Wells Fargo fleet, which was at 96.5% utilization entering 2026. Renewal activity remains strong. The renewal success rate was 79.1%, and we continue to achieve lease rate increases while extending terms. The renewal rate change of GATX's lease price index was 22.3%. and the average renewal term was 56 months. With a little over two-thirds of the combined fleet repriced in the current favorable lease rate environment, we see meaningful runway to enhance financial performance across the remaining fleets. We continue to successfully place new railcars from our committed supply agreement with a diverse customer base. Through the first quarter, we've placed over 8,400 railcars from our 2022 Trinity supply agreement. Our earliest available scheduled delivery under the supply agreement is in the fourth quarter of 2026. Additionally, supported by robust secondary market, we generated about $50 million in gains on asset dispositions in the quarter. At Rail International, railcar demand in Europe remains steady despite ongoing macroeconomic pressure in the region. Fleet utilization at the end of the first quarter was 94.7%, unchanged from the prior quarter. In India, policy support and economic growth continue to drive strong demand for rail cars. GATX Rail India's fleet utilization remained at 100% at quarter end. Within engine leasing, our joint venture with Rolls-Royce and our wholly owned engine portfolio produced excellent operating results in the quarter. Lower earnings at RRPS compared to the prior year quarter were driven by the timing of remarketing activity, which, as we've discussed, can be lumpy from quarter to quarter. Demand for aircraft spare engines remain strong, supported by resilient global passenger air travel. So we continue to closely monitor the evolving geopolitical environment and its potential impact on air travel trends. With that quick overview, we can open the line up for questions.

At this time, if you'd like to ask a question, press star then the number one on your telephone keypad. Your first question comes from the line of Andrzej Tomczyk with Goldman Sachs. Please go ahead.

Awesome. Thanks operator and morning everyone. Thanks for taking my questions. Was just curious starting off with the integration of Wells Fargo fleet and the recent deal. Just wanted to dig a little deeper on how integration is going there. if you're able to share any milestones or updates there. And then just a reminder on how we should think about synergies in 2026 and 2027. Sure, Andre.

It's Bob Lyons. I'll take that one to begin with. And first of all, the integration is going very well, probably ahead of where we anticipated we would be today. You know, as we noted back in January, we did the cutover of all of the fleet data in one step on January 1st, and that was a major undertaking, and it was very successful. And we've onboarded a number of new employees, many from Wells Fargo. We're thrilled to have them here with us. And the original headcount numbers that we laid out and the expectations for that incremental SG&A are all in line. From a customer perspective, the reaction has been very positive. Anytime there's a change of this magnitude, there's always things to work through, like contract structures and billing and cash distributions, et cetera. And we're addressing issues as they come up, but there's been zero surprises. On top of that, we've added about 300 new accounts through the acquisition, new customers, bringing our total customer base well over 1,000. And many of those are companies we've done business with before in the past. So we know who they are and they're all in industries that we know really well. So the learning curve was not very steep. You know, by and large, the largest customers in the portfolio are names that we know very well. And as I laid out in terms of back in January, the full year impact of the joint venture would be somewhere in the 20 to 30 cent range. And we're certainly on target for that.

Great, thanks. And as a follow-up, do you believe there will be more consolidation in the leasing space sort of over the medium term? Or is it sort of the case that most of the major players are set in a good place at this point? And maybe just broadly how you're assessing competition in the space and how that shows up in bidding activity of late, whether that's on the buy or sell side.

Yeah, I wouldn't really want to speculate on other potential transactions in the marketplace or consolidation in the marketplace. You know, that's a bit difficult for us to predict. And given the size and scale we're at today, we're really focused on making sure we maximize the returns on our portfolio. Competitive landscape, it's a competitive market. That's not going to change. There's a number of big full-scale lessors that we compete with on a regular basis. And then there's a far lengthier list of institutions that have fleets, you know, in the sub-100,000, sub-50,000 car range that are extremely active in the marketplace. We see them often when we compete for transactions in the secondary market, other portfolios that get offered. And they're very active buyers of GATX's assets. And we saw that in this quarter, and we expect to see it through the full year where that secondary market is incredibly robust. Capital continues to flow into this market. A lot of people recognize the value proposition that owning rail cars presents. And so we're seeing a lot of activity and a lot of interest in our secondary market offerings.

Understood. And just in terms of the overall GADX North America consolidated fleet now, where do you see that overall fleet in sort of three to five years from now, if you could share how you're thinking about ads versus selling or scrapping of the fleet over the near to medium term? Because I know historically you sort of balanced out your fleet between what you add and sell over a given period. Just wondering if we should think the same way going forward if it's largely flattish for the foreseeable future.

Just from normal fleet activity, I would say that's a fair assumption right now. Obviously, if we see opportunities to buy additional rail cars in the secondary market or direct, new cars will do that. And same on the sell side, you know, as we're always looking what's the best way to generate the most attractive return for our shareholders and optimize our portfolio. So we're always going to look at sell opportunities. But from a kind of forecasting budgeting standpoint, I'd start in the same place we do, which is kind of keeping the fleet generally in the same car count where we're at today.

Got it. And then just one more for me on leasing. One of your peers recently indicated that they believe the market value of their fleet is 35% to 45% above its book value. I was just curious if GADX has assessed that same metric in terms of market value versus the market value of your lease fleet relative to the book. And I know you have the engine leasing as well, so maybe you possibly break those out. However you guys think about it, I was just curious if you had any thoughts there.

Yeah, Andre, this is Tom. So what I'll tell you is obviously we're very active in the secondary market in both the North American rail market and the aircraft engine leasing market. And you can see from the consistent returns that we deliver, you know, if you look over the last decade, we've averaged over $70 million a year in gain on sale of assets. So clearly there's a lot of value there. A theoretical quantification probably doesn't provide a ton of value since we see it in a very practical way when we receive actual cash for the assets we sell.

Yeah, I would just add to that, too. You know, I mentioned previously that there's a lot of capital that over the course of the last 10 or 15 years has come into the rail car leasing space. We continue to see it. And while we have to deal with that from a competitive standpoint from time to time, we understand the logic. These assets are tremendous stores of value. They generate outstanding cash flow, very high-quality cash flow over very long periods of time. And they're attractive assets to own for a lot of different types of institutions. Yeah. Yeah, we do think about that, and we try to optimize that when we're bulk buying, you know, in the most disciplined manner we can, and then also optimizing the fleet and taking those opportunities to sell assets to others.

Understood. Thanks for the call, Eric. And then just last for me, shifting once to engine leasing, we're just curious – are there any incremental thoughts related to the airline industry capacity impacts into your engine leasing business with Spirit now going away, and also just broadly in the geopolitical and elevated commodity price environment, if that's impacting lease rates at all? And then I just think the engine leasing affiliates was down year over year, as you mentioned. Curiously, what drove that and if you expect engine leasing to the affiliates to be back to year-over-year growth here in the near term? Thanks.

Yeah, Andre, I'll start with the back half of your question first and then come back to the front half. So income from operations in the engine leasing business was actually up year-over-year and that was due to more engines on lease at higher lease rates. As you know, as those of you who have followed us for a while know, remarketing income in the engine leasing business can be very lumpy. And indeed, it was very lumpy in the first quarter. The remarketing income as a percent of earnings from the joint venture was less than 10% in the first quarter. Over the last couple of years, it's been about a third of our total earnings. And indeed, last year, it was around a third. But if you looked at quarter to quarter variations last time, It was between about 15% on the low end and almost 70% on the high end. So it can move quite a bit quarter to quarter. We expect when the year is over, it'll be generally consistent with what we've seen historically. So the first quarter, the driver of what was a little bit lower quarter than we've seen the last couple was less remarketing income. But I want to be very clear. that that is unrelated to what's going on in the world right now. It's still a very strong market for remarketing of that asset class, and we just expect that that first quarter is normal variation in what is historically very lumpy. As far as the first part of your question, as I mentioned through the first quarter, the business performed very well, continued to be strong supply-demand dynamics in the industry, a lot of demand for our engines, and we expect that to continue going forward. Having said that, obviously, there's a lot going on in the world right now, and we'll continue to watch and monitor the situation.

Yeah, if you look at the income contribution from RRPF, from the joint venture, over the course of the last many years and tried to identify a pattern quarter to quarter in earnings, you would find there is no pattern. It can move pretty dramatically each quarter. At the beginning of the year, I said we expected segment profit and engine leasing to be in the $180 to $185 billion range, which was up from 2025, and we still expect that.

Thanks, Bob and Tom. Appreciate the time and thoughts this morning.

Your next question comes from the line of Ben Moore with Citigroup. Please go ahead.

Hi, morning. Thanks for taking my questions. Congrats on the beat. I wanted to ask for some clarification on your NCI that looks like it's additive. It was subtracting a net loss Presumably this is the amount left out going to Brookfield. And so just wanted to see whether that should reverse to be a subtraction from net income in future quarters.

Yeah, Ben, there's kind of two parts to that question that I want to hit. First of all, if you go back to the guidance that Bob provided, it was the total impact of the Wells Fargo rail transaction. So in addition to what's going on in the joint venture itself, you need to look at the management fees that are earned and the incremental SG&A that GATX takes on. When you take those items into consideration, the first quarter was a net positive, all of those combined. And importantly, going on to the second part that I went ahead, that was with very low asset disposition gains from the joint venture. Bob mentioned at the beginning of the year, that we expected those gains to be about $70 million over the course of the year. In the first quarter, it was about $2 million. And that was expected. We expected that we would not do a lot of asset sales in the very first quarter as we focused on integration. But we continue to expect to do that over the course of the year. So again, reiterating, total impact in the quarter was positive. And it should be more positive going forward as we do some of those asset sales.

Great.

Appreciate that.

And very good print on the LPI, in my opinion, the 22.3 relative to your four-year guide of high teens to 20%. We were coming in around the 20% for the quarters. That's a nice beat. Would you say this is indicative of more sustained strength and catch-up renewal rate gains to be expected over the next couple of years, or is this somewhat high based on lumpiness just for this quarter?

Ben, this is Paul speaking. I'll take that. Let me just, I think, start with a broad statement that The North American rail market continues to be supportive of solid performance in our business. The same supply-demand dynamics that we've talked about for a number of quarters now continue to persist, which is to say that we're not seeing a lot of new cars enter the market. High scrap prices are causing a lot of older cars to exit the market, and that is causing net fleet shrinkage across the North American rail fleet. And, of course, that's very favorable for us in terms of maintaining utilization and maintaining pricing. So, overall, we've said for a while the environment is supportive. We continue to see that supportive environment. You know, we don't talk about specific guidance beyond the current year. What I'll say is we feel very comfortable with the LPI guidance we've provided for the year, for the full year. And, again, we continue to see broadly supportive conditions for our business. Great. Thank you for that, Paul.

And next one, I'd like to ask about your renewal success rate that's now in the high 70s from the mid-80s average from last year. You had noted 4Q was a step up just based on sort of, you know, intra-quarter lumpiness, if you will. So I would love to hear from you whether this high 70s could indicate some impact on the Iran conflict, or is it just a step down in the quarter? We should expect it to come back to the mid-80s average going forward.

Ben, I'll start. It's Bob, and then Paul will add to that. But coming into the year, you know, back in January, when we gave guidance on the LPI and a host of other metrics, we also provided one for the renewal success rates. And at that point, I said it would, in all likelihood, be in the high 70s to low 80s. That was our expectation coming into the year. You know, the 91% or so, whatever that we achieved in the fourth quarter. In my 30 years at GATX, I've never seen one with a nine in front of it. You know, around 80% is pretty typical if you took a very long-term average. And so that's what we guided to. And that's where we came in for the quarter. And Paul can add any additional color he'd like.

Yeah, sure. I mean, you asked about any impact of the Iran conflict. And what I'll say is, well, certainly our customers expressed concern. We all expressed concern. You know, overall, we're not seeing really any significant deterioration, broadly speaking, in market conditions for leased rail cars across North America. So, Certainly, again, everyone is concerned, but if you look at the first quarter, I wouldn't say we've seen significant impacts in the business so far, broadly speaking.

Okay, great. And then next, I'd like to ask about sort of the higher-than-expected step down in your ending balance of combined North America rail cars. It looks like the $98,535 added would be the Wells project. which is a somewhat dramatic step down from the $100K that they started with and also higher scrapping and higher sold in this quarter. So just wanted to ask about puts and takes there. Why was it that the ad is 98 versus 100 versus close to 100?

Thanks, Ben, for the question. This is Paul speaking again. I think you've got to also include the boxcar fleet, which we report on separately from the overall fleet, which is just under 10,000 cars at the end of the quarter. So I think that's a part of it. You know, broadly speaking, what I'll say is additions and subtractions from the fleet in the first quarter were more or less as expected. And so we really, I would say, that's kind of the answer to most of the questions on this call. since the acquisition of the Wells Fargo fleet.

Yeah, if you took the 98,000 on the fleet, the non-boxcar fleet, and then roughly another 3,000 or plus on the boxcar side, that gets you to the 101 that we talked about back in January when the transaction closed.

Right, appreciate that. One last one from me, a pretty remarkable step down in North America, maintenance expense. Looks like that's at 27.6% of revenue. We were at 31, sort of assuming the qualification test would keep it more elevated. How should we think about that going forward, that the maintenance expense level as a percentage of revenue Should it revert back up to sort of the 30 range from last quarter, or have you taken additional steps? And this is sort of we're seeing more synergy, cost synergy realization in place.

So, Ben, this is Paul speaking. I'll start. And, you know, basically speaking, in any given quarter, there can be noise in maintenance. And so for us, what I would say is we are standing by the full year guidance we gave for maintenance. I wouldn't read too much into the performance specifically in the first quarter. So I would say we're sticking to the overall full year guide on maintenance.

And that guide, Ben, was in the range of $500 million. So if you annualized the first quarter, you'd come out a little less than that, more in the $485 million range. But as Paul mentioned, things can move around a little bit from quarter to quarter. But for the full year, we still expect to be right in the range we previously guided to.

Great. Thanks so much for the time and for taking my questions. Thank you.

Your next question comes from the line of Harrison Bauer with Susquehanna. Please go ahead.

Great. Thanks for taking my questions. Maybe starting off just to follow up on the LPI, I just want to confirm that that is on the entire North American fleet and not just the legacy fleet. And then building off of that, could you walk through any differences that you're seeing in repricing on your legacy, you know, versus the Wells fleet as it relates to bringing up the profitability of a lot of that newer fleet that you've brought on? Thank you.

Yeah, so the LPI for Q1 does not include any material impact from the acquired Wells Fargo fleet. So going forward, obviously, over time, the more and more of that, the Wells Fargo fleet will be included in the LPI. But even with that in consideration, the full year guidance we provided of high teens to low 20s remains the guidance we're providing.

Okay, that's helpful. And then maybe just taking a step back longer term, you know, Paul, at the recent RAF conference, you've outlined a fairly credible case of rail part production potentially being lower for longer for, you know, the, you know, for at least the medium plus term. I'm curious, as you already have an avenue to growing your fleet through owning more of the wells portion, Oh, you know, this JV going forward, can you update your views on maybe your long-term supply agreement with some of the rail car manufacturers? Do you expect a difference in maybe your buying new versus used? And then just general updates or thoughts on how you expect to replenish your fleet over time.

Sure. So what I'll say broadly speaking is nothing about the Wells Fargo acquisition has changed our long-term view of supply, which is we're going to continue to buy rail cars in a variety of different ways. We'll have our programmatic multi-year supply agreements. We'll buy in the spot market and we'll buy in the secondary market. So that broad, diverse approach to procurement is going to continue to be the case. Obviously, we're not going to comment on any specific procurement efforts, but we would certainly expect that going forward, those same three prongs will apply. And, of course, you're aware that we're in the midst of a current long-term supply agreement, which we'll continue to perform on, and then eventually we'll replace that with a subsequent supply agreement when that runs out. So, really, nothing has changed in terms of our overall fleet procurement strategy.

Understood. Sort of building off maybe secondary market discussion, can you, you know, gains came in, you know, fairly strong in the quarter, sort of in line with expectations. You mentioned that the wealth fleet was a large contributor to that. Can you give any sense of maybe your assessment of the secondary market if There's if maybe the quantity versus the pricing or maybe the gains per rail car, how we should be expecting that going forward. Do you think that a lot of the secondary market has been traded through at elevated asset prices and, you know, therefore, you know, might be a bit headwind to gains as you look out to 2027?

Yeah, Harrison, I'll start quick just to reiterate what the guidance was coming in the year on gains on dispositions, which was in the range of $200 million, and that we still expect that to be the case. And as we said at the beginning of the year, we expected that to be split about $130 on the GATX wholly owned side and then about $70 from the joint venture. And as Tom mentioned, we really only got a – we really haven't started that sale process for assets out of the joint venture. That will come in the latter three quarters of the year. And we still believe we'll be right in that $70 million range. And I'll let Paul comment on just the overall activity in the secondary market.

Yeah, the overall activity remains very robust. Certainly, it's not an original statement on my part to say that there is a lot of capital that wants to invest in rail cars. Bob alluded to that earlier. That continues to be the case. And what's interesting right now, because we're in such a muted new rail car environment, really the only place that capital can flow is into the secondary market. So for us as a seller, that's a very nice position in which to find ourselves. And we do see a very eager universe of buyers out there that we're interested in transacting with. You know, you asked about, you know, gain per car and that sort of thing. And what I'll really say to that is we are opportunistic sellers in the sense that we're going to go where the relative value is most attractive to us. And that could be older cars or newer cars. It could be more expensive cars or less expensive cars. So there's really no particular metric I could give you in terms of the specific metrics like that. we're going to seek the highest economic value, um, as we sell. Um, and you know, we've been very good at that, but that means that what we sell and to whom we sell will be pretty eclectic, uh, depending on where the opportunities are.

Yeah. And as we talked about, uh, back at, uh, in January, the last time, uh, we hosted a conference call, you know, now with two X, the fleet that we had previously, we have a lot more options and a lot more, uh, ways to go to market to meet that demand from those secondary market buyers. So we're in a very good spot.

Wonderful. That's it for me today. Thank you for the time, guys.

Your next question comes from the line of Brendan McCarthy with Sudoti. Please go ahead.

Great. Good morning. Thanks for taking my questions here. Just two quick questions from me. I know you mentioned the lease economics continue to support a nice positive LPI for you, right in line with expectations. I did notice the average renewal term has kind of stepped down sequentially a little bit, quarter over quarter. Can you discuss general lease renewal conversations, how those have evolved in the past quarter? And are you making any concessions on lease term or price or anything?

Yeah, this is Paul. I'll start. You know, that is, I would say, largely noise at this point. You know, every renewal conversation is different. And so, you know, we're certainly not seeing any kind of a significantly negative trend in terms of the achievable lease term that's out there. So I wouldn't read too much into that. You know, some of it may be, and I say may be, related to the fact we have a different fleet mix right now, having added the Wells Fargo fleet. And so, One of the things is just in different car type markets, sometimes the market term may be different. So some of this may just be mixed. And if I sound like I'm speculating, I am, because, of course, we're just in the beginning of digesting this fleet. But broadly speaking, I would say we feel pretty confident that there is, for the most part, what you're looking at is noise.

Got it. That makes sense. That's helpful. And looking out at guidance, firm's 2026 four-year guidance, EPS, Now that we're one quarter through the year, a little bit through Q2, what at this point would cause EPS to come in at the lower end of that range versus the higher end?

Yeah, so purely in terms of what drives near-term variability, the biggest one is remarketing, either in Rail North America or at the Rolls-Royce joint venture. But having said that, as we've noted several times, Both those markets are very strong. It's just the size of it. And really what it comes down to when there's variability is almost always timing. You can't always predict exactly what quarter things will close. We also mentioned last quarter that Rail North America has a big maintenance spend. And Bob reiterated today that we thought it'd be close to $500 million. So even a relatively small change there can be impactful and can show up. Importantly, I would also say we're assuming no material disruption to the global economy in general or the global aviation market in particular, and in particular there to the wide-body long-haul routes. To date, we haven't seen material impacts, but we'll continue to closely monitor the situation in the world and in the Middle East.

Understood. I appreciate the detail. That's all for me.

Your next question comes from the line of Justin Bergner with Gabelli Funds. Please go ahead.

Good morning, Bob, Tom, Paul, and Sherry.

Morning.

Morning.

Morning.

It's a pity that Bloomberg misstated or perhaps overstated consensus expectations for the quarter, but it looks like a good start to the year regardless. I just wanted to kick off my questions regarding guidance and the components therein. Has anything changed? Was Rail International stronger than you expected or was that just a function of kind of a light first quarter comp in 2025?

Yeah, Justin, it's Bob. Thank you for the question and thank you for the opening comment. We appreciate that and recognize that as well. As far as kind of the overall mix of the elements that drive the full-year guidance, the first quarter was very much in line with what we expected. We kind of clicked through every single key element that drives that guidance, and we looked through where we were at in the first quarter, whether it's lease revenue, whether it's gains on disposition or gross maintenance, segment profit at Rail International. everything kind of fell very close to in line. So I would say at this point, not a lot of variance from what we expected, and the quarter played out very much the way we expected. And I'll turn it to Tom if he has anything he wants to add.

So Bob did a great job, I think. And Paul said it earlier in the call that this recurring theme of things laying out according to our expectations, that's really the key statement is, again, if you went back and pulled up Bob's opening comments from last quarter and kind of tick through things like he said, you'd see that we're very much online.

Okay, great. That's helpful. You mentioned maintenance moves can change financial performance. Are you seeing any pressures on maintenance, I guess, beyond what you may have thought coming into the year from inflationary forces?

Justin, it's Paul. The short answer is no. You know, by and large, as I said, there's noise in the first quarter, as there often is. But from a maintenance standpoint, again, more or less, it's a boring answer at this point. But the year is playing out about as expected. And, you know, we continue to be able to support our existing guidance for that reason.

Okay. That's helpful. And then lastly, if I focus on the Wells JV kind of excluding the maintenance agreement, and I look at that non-controlling interest line, what will cause that to become, you know, I guess, shall I say, not a source of income but a source of expected cost as the year progresses besides higher gains on sale? Like what else would cause that negative 6.4 to become closer to breakeven and potentially positive?

yeah justin so so i want to be sure i i follow you uh directionally what you're we're getting at there so the the nci number uh indicated a loss for the first quarter and the key reason for that as as noted earlier was um relatively uh de minimis amounts of asset disposition gains that really is the key item And stealing from the theme we keep going back to, if you look at what revenue was for the JV compared to what we expected it to be, very similar. The expense line, very similar. And that's not surprising because just like the GATX legacy fleet, most of the rail cars in the fleet in a given quarter, nothing happens to. They don't renew. They don't expire. And similarly, the maintenance expectation for a large number of cars is fairly straightforward. So those things are the items that you could look for to change, but much like the general question on what could drive overall change, the biggest one would be if that 70 million didn't happen. And then there's, as you look for other potential sources, there's a big gap between the impact of what those might be in that very first one of asset disposition gains.

Okay. Thank you. That's it for me. Appreciate it.

That concludes our question and answer session. I will now turn the call back over to Sherry Hellerman for closing remarks.

I'd like to thank everyone for their participation on the call this morning. Please contact me with any follow-up questions. Have a great day. Thank you.

Ladies and gentlemen, this concludes today's call. Thank you all for joining. You may now disconnect.