World Fuel Services Corporation

Ladies and gentlemen, thank you for standing by and welcome to the World Fuel Services Second Quarter 2022 Earnings Conference Call. My name is Michelle and I will be coordinating the call this evening. During the presentation, all participants will be in a listen-only mode. After the speaker's remarks, there will be a question and answer session. Instructions on how to ask a question will be given at the beginning of the Q&A session. As a reminder, this conference is being recorded. I would now like to turn the conference over to Mr. Glenn Clevitz, World Fuels Vice President, Treasurer and Investor Relations. Mr. Clevitz, you may begin your conference.

Thank you, Michelle. Good evening, everyone, and welcome to the World Fuels Services Second Quarter 2022 Earnings Conference Call. This is Glenn Clevitz, and I'll be doing the introductions on this evening's call alongside our live slide presentation. This call is also available via webcast. To access this webcast or future webcasts, please visit the World Fuel Services website and click on the webcast icon. With us on the call today are Michael Kasbar, Chairman and Chief Executive Officer, and Ira Burns, Executive Vice President and Chief Financial Officer. By now, you should have all received a copy of our earnings release. If not, you can access the release on our website. Before we get started, I would like to review World Fuel's Safe Harbor Statement. Certain statements made today, including comments about WorldFuel's expectations regarding future plans and performance, are forward-looking statements that are subject to a range of uncertainties and risks that could cause WorldFuel's actual results to materially differ from the forward-looking information. A description of the risk factors that could cause results to materially differ from these projections can be found in WorldFuel's most recent Form 10-K and other reports filed with the Securities and Exchange Commission. WorldFuel assumes no obligation to revise or publicly release the results of any revisions to those forward-looking statements in light of new information or future events. This presentation also includes certain non-GAAP financial measures as defined in Regulation G. A reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measures is included in WorldFuel's press release and can be found on its website. We'll begin with several minutes of prepared remarks, which will then be followed by a question and answer period. As with prior conference calls, we ask that members of the media and individual private investors on the line participate in listen-only mode. At this time, I would like to introduce our Chairman and Chief Executive Officer, Michael Kasbar.

Thank you, Glenn. Once again, the resilience of our business portfolio and the agility of our people drove a strong outcome in the second quarter. As we mentioned last quarter, super backwardization impacted commercial aviation, which continued throughout the second quarter. But we pivoted quickly, as we indicated we would, materially reducing this risk going forward. And our business aviation activity generally performed well. Conversely, high prices and continued volatility were extremely favorable for our marine business, where we achieved record results. Our marine team did an extraordinary job of servicing our clients and managing the business. And finally, our land business performed well across the board with Flyers Energy, UK, Brazil, and our World Connect business all delivering solid results. As I've said many times, we see the energy transition as a global imperative and are focused on continuing to expand our suite of energy and digital solutions to continue to deliver critical support to our customers, suppliers, and stakeholders in meeting net-zero objectives. There has been a significant increase in demand for renewable energy, and in response, we continue to build out our platform in key areas such as renewable fuels as well as wind and solar energy solutions. We have been at the forefront of sustainable aviation fuel for many years, delivering about 30 million gallons to date And during the second quarter, we became an authorized branded distributor of Neste's Sustainable Aviation Fuel, commonly referred to as SAF. With this relationship, we were able to bring SAF to Paris Le Bourget Airport in France last month. We also recently partnered with WPD Europe, a developer and operator of wind farms and solar parks in 28 countries, on a wind project in Finland. where we will manage the wind farm's power output. These are only a few of the many examples of how we are participating in the energy transition and transforming our offering with innovative energy and digital solutions. Whether our customers need help developing a carbon reduction plan, devising strategies to reduce energy use, or sourcing renewable energy, our broad offering of sustainable solutions are available to support these critical initiatives. We're proud of our team at World Connect and are excited about the growth opportunities this offers across all of our businesses in the future. While the macro environment is fraught with a confluence of market and geopolitical risks and a more active regulatory dynamic, I believe we are placed, better than ever, to profitably grow our global energy and logistics business in core conventional activities and build greater value, growth, and return in sustainable businesses and offerings, including those I just mentioned. Our focus has always been and will continue to be delivering a complementary set of products and services that delivers value for our customers, suppliers, and partners with an increasing number of digital solutions. I am enormously proud of our global team and the grit that they have shown over the last few years and continue to demonstrate as we further fortify our global diverse energy solutions offerings. We are encouraged and animated by the continuing opportunities and runway we see for our business. Before I turn over the call to Ira for a financial review of the quarter, I want to give a very special thanks to Jeff Smith and our digital and business teams for their tremendous effort and teamwork in shutting down our last of 22 data centers, which will make us a cloud-first business. This will increase our resiliency and give us virtually unlimited scalability. Ira, why don't you take it from here?

Thank you, Mike, and happy birthday. Before I review our second quarter results, Please note that the following figures exclude the impact of non-operational items highlighted in our earnings release. These items principally include acquisition related expenses and integration costs related to the Flyers Energy acquisition, which in aggregate were $1.4 million after tax in the second quarter. You can find the breakdown of the non-operational items on our website and on the last slide of today's webcast presentation. So I'm not sure I could think of a quarter historically which better demonstrated the resiliency of our business and the value of the diversity of our business model than this past quarter. Simply put, we delivered solid results even though our aviation business continued to be significantly impacted by severe market pricing backwardation throughout most of the second quarter, given the principally contract-oriented nature of our aviation business. However, these volatile market pricing dynamics drove our spot-oriented marine business to record results. And our land segment, which on the back of the recent Flyers Energy acquisition, has become a larger and more rateable piece of our broader business, delivered very strong results as well. Now let's continue with the financial highlights. Sustained high fuel prices and increasing volume drove consolidated revenue to a record $17.1 billion in the second quarter. up more than 140% year-over-year, and year-to-date putting us just under the $31 billion in revenue that we posted for the full year in 2021. Volume again grew year-over-year across all our business segments with commercial aviation passenger volumes recovering to approximately 85% of pre-pandemic levels. Adjusted second quarter net income and earnings per share were $26 million and 41 cents per share, respectively. Adjusted EBITDA for the second quarter was $76 million, an increase of 31% compared to the second quarter of 2021, again, despite the significant negative backwardation-related impact to aviation results this past quarter. With regard to segment volumes, Our aviation segment volume was 1.8 billion gallons in the second quarter, an increase of 33% compared to the second quarter of 2021. The year-over-year volume increase resulted principally from the ongoing recovery in commercial passenger activity. Volume in our marine segment for the second quarter was 4.9 million metric tons, an increase of 6% year-over-year. As evidenced in the past and then again during this past quarter, during times of elevated fuel prices, constrained credit, and rising interest rates, we've become a more critically valued counterparty, which increases our success rate and contributes to profitable volume growth. Our land segment volume was 1.5 billion gallons or gallon equivalents during the second quarter. That's an increase of 19% year over year. The year-over-year volume increase was principally driven by volume associated with the flyer's acquisition. Consolidated gross profit for the second quarter was $253 million. That's up 37% year-over-year and represents the highest level of quarterly gross profit since the first quarter of 2020. In terms of aviation gross profit, the fundamentals of our aviation business remain strong, with commercial passenger aviation continuing to recover from the pandemic, and business and general aviation and cargo activities all posting solid results versus last year. However, the segment's second quarter gross profit declined to $53 million, which is down 40% year over year, driven principally by the impact of severe market pricing backwardation and, to a lesser extent, the exit from Afghanistan last year. As a reminder, we began experiencing the impact of severe pricing backwardation in the latter half of the first quarter. Again, this is when future forward prices began trading significantly below spot oil prices. During the second quarter, backwardation became increasingly severe and continued through much of the quarter. Our team has now successfully renegotiated sufficient customer contracts to minimize related risk going forward. While still backwardated, market conditions we experienced in the second quarter have now reverted much closer to historical norms. As we look ahead to the seasonally strong third quarter, and with the backwardation issue generally behind us, we expect aviation gross profit to rebound significantly, with results expected to be up year over year, despite the discontinuation of the Afghanistan business last year. The marine segment performed extraordinarily well, benefiting from record high bunker fuel prices, an increased level of price volatility, as well as a credit-constrained marketplace. This resulted in quarterly gross profit of $78 million, an increase of 244% year-over-year, and the highest level of marine quarterly gross profit in the history of the company. Kudos to the global marine team for such absolutely fantastic performance with solid results across all sectors and geographies. For the third quarter, we expect marine results to again materially exceed the prior year. However, with bunker fuel prices somewhat lower quarter to date, it is unlikely that the third quarter will be as strong as the second quarter. Our land segment delivered gross profit of $122 million in the second quarter. That's up 66% year over year, principally as a result of the recent Flyers acquisition. which continues to outperform our expectations. Additional highlights included strength in our UK operation, which delivered strong results in what is traditionally represented a seasonally low quarter for them, and year-over-year growth in our commercial and industrial and retail activities. Our World Connect business also continues to perform well, with a growing suite of products and services to support our customers' decarbonization efforts, And with a robust pipeline of related investment opportunities, there are clearly more growth opportunities ahead in this space. Land gross profit should be up materially year over year in the third quarter, driven by the impact of flyers, but also continued growth in our broader land business, but should experience a sequential seasonal decline principally driven by our UK operations. Core operating expenses were $197 million in the second quarter. That's up 5% sequentially, principally driven by higher operating expenses associated with increased business activity during the second quarter. We expect core operating expenses to be in the range of $198 to $204 million in the third quarter. Bad debt expense in the second quarter was $2.6 million. We continue to manage our accounts receivable exceptionally well as volume growth and higher fuel prices have increased the size of our overall receivables portfolio to a record level. Adjusted EBITDA was $76 million in the second quarter, representing an increase of 31% year-over-year. Despite the aviation backwardization impact, this was our best quarterly performance since the pandemic began. Our interest expense was $25.9 million in the second quarter, significantly higher than recent run rates, principally related to rapidly rising interest rates, as well as increased borrowings under our credit facility and increased activity under our trade finance facility, both associated with growing volumes and high fuel prices throughout the quarter. Based upon the current interest rate environment and funding requirements, we expect our level of interest expense to be in the range of $24 to $27 million in the third quarter. Significant foreign exchange volatility during the second quarter also resulted in a few million dollars of foreign exchange losses during the quarter. Moving on to tax. So over time, we had been required to establish tax valuation allowances in jurisdictions where cumulative losses precluded our ability to utilize certain deferred tax assets. This was exacerbated by the pandemic. Coming out of the pandemic, As profitability has been increasing in many of the countries where such allowances were necessary, it should enable us to reverse these allowances over time. In the second quarter, one such reversal drove our quarterly tax rate down significantly and was the principal contributing factor leading to a negative effective tax rate for the quarter. For the third quarter, our effective tax rate should return to a more normalized mid-20s level And for the full year, inclusive of any allowance reversals, we expect our effective tax rate to be in the range of 17 to 20%, which is down from 26% in 2021. Despite a 14% sequential increase in average fuel prices and higher volumes during the quarter, we generated operating cash flow of $43 million. As a result of our efforts to expand the size of our banking facility, while also increasing the capacity of our trade finance facilities, our liquidity position remains strong, supporting our growth initiatives for the second half of the year and beyond. We repurchased just over 1.5 million shares of our common stock during the second quarter, increasing year-to-date repurchases to more than 2 million shares. And we have now repurchased nearly 15 million shares over the past 10 years, demonstrating our continued commitment to drive additional shareholder value through both buybacks and dividends. In summary, despite the backwardation-related challenges in aviation, we delivered solid results in the second quarter. Core aviation activity continued to rebound from the pandemic. Our marine business delivered absolutely fantastic results and our land business, including Flyers Energy, also had a very strong quarter. In addition to our core fuel, natural gas, and power business activities, with expanding renewables offerings and a growing suite of additional carbon reduction solutions offered by World Connect, we are very excited about the future. All of our customers around the world are at some stage of their decarbonization journey, and our product and service offerings in support of their sustainability efforts should provide growing opportunities for us going forward. We also continue to maintain a strong balance sheet with a solid liquidity profile, providing sufficient capital to support organic growth and value-creating investments, while also returning capital to our shareholders, again, through share repurchases as well as dividends. With that, I'd like to turn the call back over to our operator, Michelle, to start the Q&A session. Thank you.

Thank you. To ask a question, you will need to press star 1-1 on your telephone. Please stand by while we compile the Q&A roster. And our first question comes from the line of Ken Hector with Bank of America. Your line is open. Please go ahead.

Great. Thanks. Good evening, Michael and Ira and Glenn. Maybe just kind of go over the aviation backwardation. Is this because of your inventory levels that you had to go back and address the contracts? Ira, you mentioned you've gone back to the customers and reshaped the contracts. Maybe you could walk us through that process and where that, you know, is that done? And you mentioned not seeing the backwardation. Maybe just walk us through the basics there.

Well, because of the structure of our supply contracts and our customer contracts, the highly unusual and unprecedented backwardation issue resulted in losses for us as we rolled, you know, inventory futures every month. What we were able to do coming out of the second quarter going into the third quarter is reshape the good thing for us is a very large percentage of those contracts actually roll over on the 1st of July. So we're able to renegotiate enough contracts to pretty much eliminate the need for us to continue rolling those contracts so we wind up with a more balanced position, if you will. And therefore, despite the fact that the backwardation issue has resolved itself to a great deal because we went from being 30, 40, 50 cents backwardated to about five cents this morning, we pretty much mitigated that exposure and we don't foresee that type of issue going forward because again, we no longer have the need to roll contracts forward, whether it be in a backward-dated market or a more normal, you know, with a long-term contango market where the curve is trending upwards.

Switching over to marine, you hit a huge gross profit per gallon. When I think about it, you mentioned record levels, looking at kind of a $15 gross profit per metric ton, $15, $16. How should we think about that going forward? Is that something that we're done with the $7 level? Given where fuel is, it will stay in the teens at double digits? How should we think about that?

Well, for a good part of the second quarter, Ken, in this crazy pricing environment, bunker fuel was, on average, $1,000 a ton. You may remember when we had the IMO regulations kick in and people converting over to the more carbon-friendly fuel. That was trading somewhere under $500 a ton, somewhere between $400 and $500. We'd never seen $1,000 a ton before. We've always said that because marine is principally a spot business, unlike aviation, which is heavily contract-oriented, as market price moves, you could kind of reset your go-to-market strategy daily, hourly, by the minute. And there's a pretty tight correlation over the long term between the underlying price of the commodity and our margins in that business. And therefore, with prices at record highs, it's not surprising that our margins would have been so much stronger. So the second part of your question really depends on your views or market expectations of where pricing may go. Prices are still high. They're off a little bit. I would say they're down 5% to 10% from the average levels in the second quarter so far in Q3. So that's That's part one. So it's tough to forecast. One of the things I mentioned by prepared remarks is we don't expect to repeat Q2 because of the extraordinary dynamics. But we're still going to have significant year-over-year growth as the market still remains tight. And as Glenn reminds me, part two to the story is in an environment like this where the underlying commodity is $1,000 a ton, again, at record levels, It makes it a bit tougher for certain players in the market to compete because you need a strong balance sheet and you need more capital to be able to support your own working capital requirements at these levels. And we being the big 900-pound gorilla with a solid balance sheet, we wind up generally outperforming in those scenarios. We generally become a much more valued counterparty because we're out there providing the amount of credit that our customers require, and they value that more than they normally do in an environment where prices are so significantly high.

And then just one more.

Oh, go ahead, Michael.

Go for it, Ken.

By the way, happy birthday. Is it today?

It is. It is. I couldn't think of anything better to do.

Yeah, you know, I get earning season on my birthday, but this week it's this weekend, so I get it until Saturday. Ira, in this environment, how do you think about cash? You ended up buying back a sizable amount of stock this quarter. You're, I presume, generating increasing amount of cash flow with these higher prices, but you also increase your accounts receivable as you extend more credit with higher prices. Maybe just walk us through your thoughts on the environment and your thoughts on flowing through to cash, or maybe that's a Michael question in terms of thoughts on opportunities.

Well, on the cash-specific question, we used some cash in Q1 as prices started accelerating. Generally unavoidable, our business was growing year over year, and prices were growing at the same time. In the second quarter, Even though prices grew significantly, we were able to manage our balance sheet in a way where we still generated cash. Part of that was certainly helped by the phenomenal performance in marine. So if you look forward, we didn't generate a ton of cash, but we generated $43 million of operating cash flow. If you go forward, once prices are where they are, if they're not increasing further or if they're going down, it provides an opportunity to generate even more cash because you don't have to increase your working capital level even further. Thus far, this quarter, prices are down a little bit. I don't know if we're going to sustain that. We're still in a very volatile market, but we should do much better from a cash flow standpoint in the second half of the year than we did in the first half, returning hopefully to kind of a more normalized quarterly level of cash flow. And with our higher level of earnings, you know, that number should be stronger compared to, you know, where we were the last couple of years during the pandemic when earnings were depressed. So solid cash flow in the second half, unless the, maybe I shouldn't use the word surprise, but unless in this crazy market, you know, it takes another couple of turns and all of a sudden prices are up 20%, you know, it makes it more difficult to generate cash in that environment. But in a price range environment, we should generate more cash in Q3 and Q4 than we did in Q2. Great.

Thanks for the time and thoughts. Appreciate it.

Happy birthday.

Thank you. And our next question comes from the line of Ben Nolan with Stiefel. Your line is open. Please go ahead.

Well, thank you. And, yeah, happy birthday there, Mike. I happen to know that all the smartest people in the world were born in July, so happy birthday. Yeah. I wanted to sort of level set, if I could, for a second, just to make sure that I understood everything correctly. Yeah. The aviation business, you're expecting for the third quarter to be at least as good as it was last year. And then the other two businesses, in some cases, substantially better than they were last year. Is that correct? So gross profit across the board should be, you're expecting to be meaningfully higher than it was a year ago in the third quarter. Is that fair? Oh, year over year, absolutely. Okay. So that's... I thought that's what you'd said. I was just making sure. So there's a few things that I'm curious about. First, the interest expense is a lot higher. I appreciate that there's a lot more working capital, as you were talking about with Ken. But in general, do you chalk that up? I'm trying to The marine business was phenomenal. And so is the working capital primarily needed for that marine business? And so is the function of that you're really able to pass on that cost of capital pretty effectively to your customers and maybe less so in the other businesses? Or am I not thinking about that right?

You know, Ben, I think the thing that you have to have, you know, you recall that there's sort of a banking industry. element to what we're doing. I mean, we are a source of financing for, you know, many of our customers. So similar to a bank, you know, high interest rate environment is favorable to us in that dimension. It's unfavorable in other dimensions, but I'll let Ira take the rest of it.

Yeah. So, you know, continuing on from what Mike just said, I would say the principal amount of cash needed to run the business in this high-priced environment and the incremental investment in working capital does come out of marine, but aviation as well. Less so land, you know, land generally, just the makeup of that business just has kind of much tighter cash flow and, you know, a lower investment in working capital. So, you know, to Mike's point, yeah, our interest expense went up, but relative to the increase in marine profitability, I hate to call it a rounding error, but in that regard, it was significant in the ordinary course because we're about $10 million up sequentially. Again, as you hit it on the head, it's driven by higher average borrowings in the growing volume and high price environment. Prices were up almost 15% in Q2 versus Q1. you know, with the Fed move yesterday and the one about a month ago, you know, our average rates, even though the Fed made their move yesterday, SOFR or LIBOR rates, you know, already factored most of that in, you know, weeks leading up to that. So our average borrowing cost is probably up about 150 basis points versus Q1. You know, we're coming off a long period of sustained near zero rates. And of course, that's now changed. I personally don't believe that's going to last a really long time not trying to be an economist but for now uh you know that level of interest expense that we incurred in q2 you know will likely continue for the balance of the year glenn sitting here is working hard to minimize that every day but you know it's unlikely that it'll be materially lower uh but again it's uh you know as mike mentioned uh you know being a bit of a bank um you know it's it's indirectly you know involved in or contributing to You know higher margins in many parts of our business. We're making those underlying working capital investments Right.

Okay, that makes sense Well, I the last one for me and and I'll turn it over but You know increasingly there is concern about the possibility of a recession and I think that I hit all equity markets and I assumed it's probably hit your own equity price a bit and Can you maybe talk me through how you think the company is positioned, how elastic or inelastic you might be to the potential of a recession, or if you think that, you know, as it relates to world fuel, that the company is different now than maybe it had been in previous cycles?

Well... Certainly the credit side of the equation. I think if COVID didn't demonstrate our risk management, I don't know what will. Sailing through it, I guess, is probably not the right word. It was certainly not sunny days. So I think that's pretty well known. And then the you know, the variability, you know, of our, you know, cost piece. You know, we've concluded a number of different things in terms of, you know, platform. We've got a significantly greater volume. Certainly the credit side of the equation, you know, I think if COVID didn't demonstrate you know, our risk management. I don't know what will. You know, sailing through it, I guess, is probably not the right word. It was certainly not sunny days. So I think that's pretty well known. And then the, you know, the variability, you know, of our, you know, cost piece, you know, We've concluded a number of different things in terms of platform. We've got a significantly greater volume of activity going through the platform, so our ability to modulate on expense and looking at volume and margin I think we're in a far better place now than we ever have been before. A lot of our systems build out. It's been concluded. Teams are in place. So the ability to dial back in a number of different areas I think are significantly greater now. It's taken a long time to get to that point. But I think we're all feeling confident. We're feeling pretty poised with all the things that we've been through, with everything that the market has thrown our way. A recession sounds like a light drizzle. So I think that this is an organization and a team that has been fire-tested, fire-tempered. So... think we know what to do and you know for those companies that may be a bit stressed we know how to support them as well so if anything as one of our investors was mentioning to IRA there's a company that's built for turbulence so we know We know how to operate in all sorts of different market environments. So, I don't know, Ira, do you have more you want to add?

Yeah, I'll try not to be repetitive to Mike, but I kind of view the first half of 2020 as just a phenomenal example. I mean, that was the recession of all recessions, where a recession is when business slows down. In 2020, business just stopped. And I think we did an excellent job of mitigating the volume and profit generation reduction by pivoting really quickly and taking a lot of cost out of our business. We acted, you know, almost immediately, or not almost, we acted immediately, and obviously it was impossible to mitigate the entire drop-off, but we certainly did as good of a job as I believe we could have in taking, you know, variable costs out, even some fixed costs out. So, you know, I think we've demonstrated that in previous recessions as well of course you know along with the recession you're probably going to have some decrease in activity which will reduce our working capital requirements so we'd be getting some relief that way so you could you know glass half-full would say you know that's one positive that would come out of that environment and the other thing that's interesting is you know while we aside from the Flyers deal we haven't been you know crazy acquisitive of late but we have a solid balance sheet, and we're still out there, you know, hunting for opportunities that make sense across, you know, all of our businesses, you know, land, the Connect, sustainability-related platform, et cetera. And, you know, to be honest, I think a lot of folks have gotten ahead of their skis the last couple years, and multiples have been, you know, inflated, and, you know, a recession could be a breath of fresh air in that regard of getting folks a little more humble in terms of valuation, and it could lead to some you know, better opportunities for us, you know, over the next few quarters as valuations will clearly come down. So, you know, I think we've demonstrated pretty solid results on a relative basis in recessions in the past. And, you know, because our team is just, you know, phenomenally nimble, you know, of course you can't do a lot about demand, you know, drop off. But, you know, I believe, again, as I mentioned, we're a critically valued counterparty in this credit constraint environment. I think we're a more valued counterparty in an environment where, you know, there are recessionary tendencies.

And also, you know, likely to have lower prices, which will also be, you know, salutary for cash flow.

For cash flow, right. All right. Well, I appreciate all of the color there.

Thanks, guys.

Ben, you got another question?

You know, I'm not a July birthday, but if you want September, you can ask me now or ask me in September.

Well, Mike, if you beg it out of me, you guys were just talking about the Flyers acquisition. I know that when you'd done that, there were aspirations of, you know, possibly finding others adjacent bolt-ons in similar business areas, but expanding the geographic footprint. Any update on how you're thinking about that?

So playing off of what I just said, you know, Ben, yes, you know, we're still thinking about that. There are a lot of opportunities that we're, you know, that we're looking at with all due respect to some of those people, you know, many of them, you know, until very recently, at least continue to have extremely high aspirations from a value perspective. So that has resulted in maybe less activity or no activity in the last few months than we would have hoped. But I think that may change. There are several things we're looking at now that would be complementary to flyers and the broader land business. So hopefully, we'll be able to execute on a few of those over the next few quarters. And we continue, as Mike and I have both emphasized a bit more on this call, the growing suite of products and services we have supporting our customers with their energy transition journey. There are a lot of opportunities there, frothy valuations in that area as well. Hopefully, those are about to become a bit more reasonable, and we're certainly looking to to organically grow that business, but, you know, find strategic opportunities to accelerate the growth of that exciting piece of our business as well.

All right. I'm tapped out. That does it for me. I appreciate it. Thanks, guys. All right. Thanks, Ben. Thanks very much.

Thanks. Thank you, Carl. Thank you for participating. You may now disconnect. I would like to hand the conference back over to Mr. Michael Kaspar for any further remarks.

Well, thank you to all of our investors on the call and especially to the team, our global team. We've got the best global team, and we've been through a lot. It feels good to be here, and we're excited about the future. We've got a great global platform. We've got a great suite of products, and we've got great support from our customers and suppliers and partners, so we feel very lucky. So thanks very much, and we look forward to reporting back in a quarter. Stay healthy. Stay well.

This concludes today's conference call. Thank you for participating. You may now disconnect. Everyone, have a great evening.