Ingevity Corporation Common Stock

Good morning or good afternoon all and welcome to the Ingevity fourth quarter and full year 2021 earnings webcast. My name is Adam and I'll be your operator today. If you'd like to ask a question during the Q&A portion of today's call, you may do so by pressing star 1 on your telephone keypad. I will now hand you over to Mary Hall to begin. So Mary, please go ahead when you are ready.

Yes, thank you Adam. Good morning all. Welcome to Ingevity's fourth quarter and full year 2021 earnings call. Early this morning, we posted a presentation on our investor site that you can use to follow today's discussion. It can be found on ir.engevity.com under Events and Presentations. Also, throughout this call, we may refer to non-GAAP financial measures, which are intended to supplement, not substitute for, comparable GAAP measures. Definitions of these non-GAAP financial measures and reconciliations to comparable GAAP measures are included in our earnings release and are also found in our Form 10-K. We may also make forward-looking statements regarding future events and future financial performance of the company during this call, and we caution you that these statements are just projections, and actual results or events may differ materially from these projections as further described in our earnings release. Our agenda is on slide four. With me today are John Fortson, our President and CEO, Mike Smith, President of Performance Chemicals, and Ed Woodcock, President of Performance Materials. In addition, we have Rich White, Steve Hume, and Eric Ripple available for questions and comments. Rich and Steve are our recently appointed co-leads for Performance Chemicals, given Mike's March 1st, retirement. And Eric heads our growth and innovation effort. John will review key accomplishments in 2021. I'll follow with highlights of our financial performance in Q4 and full year. Mike and Ed will review the performance of their business segments. And John will conclude with our outlook for 2022 and full year guidance. And with that, over to you, John.

Thanks, Mary, and good morning, everyone. Thank you for joining us this morning on what is obviously a busy news day, and we appreciate your interest in Ingevity as we report on what we feel was a strong 2021. If you turn to slide number five, I'll start by highlighting some of our accomplishments. As you've seen on the new landscape slide after our cover page, Ingevity's products touch our everyday lives in many ways. Our technologies really do purify, protect, and enhance the world around us. And we're doing this while being a best in class, profitable and growing company. Overall, I'm really proud of the way Ingevity performed for the year. We grew revenue by 14% and adjusted EBITDA by 6% over 2020, despite what was a dynamic business environment. We all know the supply chain and logistics challenges our industry faced. Ingevity did a terrific job driving revenue growth through both increased volume and price across our portfolio. Performance Chemical saw a strong recovery from the pandemic impacted 2020. Engineer polymers in particular drove revenue increases by almost 50%. Remarkable work by this team and we thank them. Demand for our industrial specialties products continued to increase. Compared to the last several years, supply and demand are in a good spot across plant chemical applications. This increased demand has translated into higher volumes and has allowed us to aggressively raise prices. Performance materials performed well in the face of the microchip shortage. While Q1 2021 started strong, microchip issues plagued the global auto industry throughout the year before chip availability improved in Q4 2021. From our internal estimates, this resulted in roughly 60 to 70 million of lost sales last year. We anticipate this will correct as auto industry production increases and microchip supplies normalize. Despite these hurdles, Performance Materials delivered impressive 40-plus percent segment EBITDA margins for both Q4 and the full year. We also leveraged operational excellence to serve customers and gain share. Our team continued to work safely in the face of first the Delta variant and then the Omicron variant of COVID-19. While our goal is always zero injuries, I am proud of our operations teams for working injury-free at all our global technical centers in over 50% of our manufacturing facilities. We jumpstarted continuous improvement projects across our plant network. This is no easy feat while wearing masks and with ongoing on-site testing. These projects are intended to drive down costs this year, increase efficiencies, and lead to better customer service. Finally, our supply chain excellence really is a competitive advantage for us. We are stepping in to support new and existing customers when others are unable to. Now is the time to gain market share, and we are doing just that. We have experienced significant share gains in our adhesives products as a direct result of these efforts. We continue to strategically invest in growth in our future. We completed alternative fatty acid production and saw the first sales of our new AltaVeg product. We continue to assess other feedstocks and expect commercial sales to grow this year. Our performance chemicals team advanced their work in bioplastics understanding the role our engineered polymers technologies can play in addressing the world's plastic pollution challenges. Our products are increasingly being recognized as a critical component in various biodegradable processes. We recently received news that our products have passed tests for marine biodegradation, which will lead to future certifications that complement the industrial and home compostable certifications we already have. Also, we're excited about the product's potential to further grow in the auto industry and support electric vehicles. We continue to expand in-market penetration of Engineer Palmer's products due to their unique performance and sustainability attributes. We further improved our sustainable value proposition for shareholders and customers. We increased our key ESG ratings, particularly our S&P Global CSA and ECOWAS scores. More importantly, we advance the role our products play in helping our customers achieve their own sustainability goals. For example, a recently completed third-party product study shows that West Res, our performance chemicals adhesive technology, has a 62% lower in-life carbon footprint than petroleum-based alternatives. And we increased the number of USDA-certified bio-based products in our portfolio by 50%. bringing our total to 34 products that are recognized. A lot was accomplished in 2021, and we will do even more in 2022. I'll now turn the call over to Mary to review our fourth quarter and full-year financial performance.

Thanks, John. Please turn to slide six while I review our Q4 and full-year financial performance. As John mentioned, sales were up 3% Q4 over Q4, and 14% year-over-year as robust volumes in performance chemicals more than offset the volume decline in performance materials, automotive emission products, and price increases were successfully implemented across all business lines. Significant price increases were necessary to mitigate the inflationary pressure on costs that intensified in the second half of the year. For example, year-over-year freight costs were up 30% and energy costs ended the year almost 50% higher. Also, our SG&A costs were up in 2021 as we returned to more normal commercial operations, including increased travel and entertainment and spend on growth initiatives. Despite the dual challenges of sharply rising costs and the impact of the microchip shortages reducing our high-margin auto-emission product sales, we delivered record adjusted EBITDA of $422 million and adjusted earnings per share of $5.23 with an adjusted EBITDA margin of 30.3%. On slide 7, we've laid out certain key financial metrics and highlights. You can see our sales and adjusted EBITDA trends since 2016 in the top left chart with sales growing at a compound annual growth rate of 9% while we grew adjusted EBITDA margins from percentages in the low 20s to north of 30%. Our margin dip in 2021 to 30.3% reflects the impact of the steep drop in volume of our auto emission product sales and rising costs, as I mentioned earlier. Our adjusted earnings per share of 523 reflects a compound annual growth rate of over 20% since 2016 and an increase of over 6% compared to 2019's strong performance. Free cash flow was down as expected compared to 2020's COVID impacted level, but was up more than 17% from 2019. Q4 inventory build in performance chemicals in anticipation of seasonal demand and continued strong volume growth resulted in free cash flows slightly below our guidance for the year. Our capital allocation continues to balance growth with returning capital to shareholders. In 2021, 40% of our capital expenditures were on growth projects with a similar spend on our strategic investments in green gas and other ventures. In addition, we repurchased over 1.4 million shares for about $109 million, and since our 2020 board authorization, we have repurchased a total of approximately 3 million shares for just under $200 million. Our strong cash flow allowed us to fund our growth initiatives and share repurchases while also reducing leverage to 2.2 times net debt to adjusted EBITDA from 2.5 times at year-end 2020. We believe this balanced and disciplined approach to capital allocation serves all our stakeholders well. And now I'll turn it over to Mike for more color on performance chemical segment results.

Thanks, Mary. I'll continue on slide eight. Our performance chemical segment saw strong revenue growth continued increased demand and improved pricing in the quarter, with both industrial specialties and engineered polymers benefiting from a robust sales environment throughout the year. Segment sales were up 24%, both quarter over quarter and for the full year, at $204 million and $875 million, respectively. Industrial specialty sales increased 28% versus the prior year quarter, with strong performance across all markets. Sales growth in adhesives, TOFA, and dispersants all increased by over 30% versus Q4 2020. Oil field applications delivered particularly strong growth with sales up over 50% in the quarter due to the increase in North American drilling activity and our growth in sales to the Middle East. In addition to solid volume growth from increased demand in key industrial specialty application, price increases averaged over 20% in the quarter. The supply-demand environment remains favorable as Chinese gum rosin prices remain 50% above levels in late 2020, and vegetable-based fatty acid pricing continues to be up significantly versus early 2021 levels. Our agricultural chemical business saw increased demand due to further adoption of our sustainable technologies across the market segment. We continue to see positive outcomes from late-stage field trials underway across major agricultural customers. We also sold non-CTO based alternative fatty acid as well as alternative fatty acid derivatives in Q4. We remain excited about the additional alternative fatty acid capacity at our CrossFit facility coming online in early Q2 of this year to support more substantial future sales growth. Avon Technologies had a record Q4 with sales up 11% mainly driven by pavement preservation volumes. The business also saw the successful introduction of new product launches during the quarter. The strong finish to the year resulted in our pavement technology business achieving its 10th straight year of sales growth, a great milestone demonstrating the value of our innovative, sustainable paving solutions and the strength of our team. We continue to be pleased with our engineered polymer business, which grew 22% Q4 over Q4, as we continue to experience growth in automotive, industrial equipment, and footwear and apparel. Revenues were boosted by further price increases to offset inflationary costs for raw materials, logistics, and especially energy that spiked in Q4. As John and Mary shared, the engineer polymers team delivered an impressive 46% increase in full-year sales, showing growth in all regions and largely the same markets that drove Q4 growth. Energy, raw materials, and logistic costs continue to increase, and the ability to move product efficiently around the globe remains challenged, but price increases allowed us to offset these inflationary impacts in the fourth quarter. Performance chemicals EBITDA of $22 million in Q4 was down 19% prior year quarter, primarily to inflationary cost pressures and increased SG&A investments. Full-year EBITDA increased 16% versus prior year as price and volume improvements more than offset inflationary cost pressures. I'll now turn the call over to Ed to discuss performance materials results.

Thanks, Mike. If you'll turn to slide number nine. Sales for the performance materials segment were down 18% at $132 million compared to our all-time record quarter in Q4 2020. when the automotive industry rebounded sharply post the initial pandemic lockdowns. In the quarter, our automotive related product sales were impacted by lower vehicle production driven by the ongoing chip supply constraints. With lower production volumes of our automotive products, our mix shifted towards our lower value water, food, and beverage purification markets. Sequentially in comparison to Q3 2021, our Q4 revenue was up 11.8% as North America and China vehicle production rose 11% and 39% respectively during the quarter. Driving the sequential increase was the clearance of the Southeast Asia COVID microchip backlog that began to correct in early October and generated chip supply into Q4. Still hovering at low levels, North American vehicle production fell 15% versus Q4 2020, and December U.S. light vehicle inventories remained well below December 2019 and 2020 levels. China light vehicle production and sales in the quarter were down 2% and 5% respectively versus prior periods. North American Q4 vehicle production remains at a favorable mix of 81% trucks and SUVs to 19% sedans and tracked closely to the full year mix of 80% trucks and SUVs to 20% sedans. OEMs continue to direct their limited microchip volumes to their most profitable vehicles, pickups, and SUVs. These vehicles are also beneficial for longevity as they typically have larger canisters and multiple honeycombs as part of their evaporative emission control systems. For the full year, our sales of $517 million were up slightly, primarily due to price increases. Our segment EBITDA of $249 million was almost even with 2020. Despite the supply chain challenges throughout the year, we maintained a solid 48% segment EBITDA margin for the year. Based on IHS data, we estimate the full year impact to longevity of microchip related production losses to be about 60 to $70 million in revenue. We expect microchip supplies to continue to be constrained throughout 2022. Lastly, US and Canada Tier 3 implementation is ongoing as some model year 2022 platforms were delayed by the pandemic. Remaining Tier 3 implementations should be completed in early 2022. I'll turn the call back over to John to discuss our guidance for 2022.

Thanks, Ed. On slide 10, I'd like to review our outlook for 2022. Our guidance for 2022 is sales to be between 1.525 and 1.6 billion and adjusted EBITDA to be between 430 and 460 million. This guidance for both revenue and EBITDA is fairly broad to reflect a wide range of potential outcomes in the performance materials segment. In the performance chemicals segment, we expect revenue growth from higher volumes and continued price increases across all product lines to offset continued cost pressure. While performance chemicals margins were down in Q4 of 2021, we expect them to normalize this year as cost increases plateau. Industrial specialties and engineered polymers are off to a great start this year, and while it's too early in the year to measure pavement technologies, we believe we'll see good growth as countries globally expand their paving operations. The outlook for performance materials is less certain. Forecasts for 2022 auto production are conservative due to the ongoing microchip shortage and other auto supply chain issues. Q4 2021's chip availability improved from Q3, but we're not confident a sustainable rate of supply has been achieved. For 2022, the lower end of our range assumes continued supply constraints in the first half of the year, followed by some recovery in the second half. To the extent industry dynamics improve and recover sooner, we would end up at the higher end of our range. We will continue to invest organically as we bring online our new poly-alkabat capability in DeRitter and an alternate fatty acid stream in Crossit. Additionally, we are working on several de-bottlenecking projects at our performance materials facilities. We are also in the execution phase of our SAP S4 HANA implementation. CapEx will be elevated somewhat from recent levels, but we consider these investments well worth the effort. as they exceed our investment return expectations and will help us sustain our highly profitable growth. Finally, we will continue to return capital to shareholders as we see opportunities to buy back shares at what we consider attractive levels. I'm confident our team will deliver a strong performance this year. Before we go to Q&A, I would like to take a moment to thank Mike Smith for his service to Ingevity. This will be his last earnings call, and going forward, you will hear from Rich and Steve. Mike, while we know you, we'll still see you around. We thank you. We wish you the best of luck. In closing, I appreciate the ongoing hard work and efforts of all of our employees worldwide. We hope you share our enthusiasm for longevity. At this point, we'll take your questions.

As a reminder, if you'd like to ask a question today, please press star followed by one on your telephone keypad. When preparing to ask a question, please ensure your headset is fully plugged in and unmuted locally. That's star one on your telephone keypad. The first question today comes from Vincent Addison of Stifle. Vincent, please go ahead. Your line is open.

Vincent Addison Good morning. Can you hear me okay?

You broke up just a little bit. Go ahead.

Vincent Addison All right. I'll give it a shot. Just yell at me if it keeps breaking up. Can you speak to the revenue mix in engineered polymers this quarter between Monomer raw material pass through and derivatives and you know where that could trend over the course of 2022 as it relates kind of to your margin expectations on that.

Yeah, thanks. So in general, our mix for derivatives versus monomers, you know we expect that to continue to be more towards derivatives. um you know from a volume standpoint you know that mix didn't change too much in uh 2021 as all areas of the engineering polymers business grew quite significantly but as we described over time our focus and working closely with our customers is to continue to drive the derivative sales in both polyols and thermoplastics and as evidence of that of course we're very much looking forward to getting the start up of our new polyol facility in Derrida here in the middle of this year.

Okay, thank you. And can you, just staying on performance chemicals, could you discuss your CTO costs and importantly your availability heading into 2022 on the portion of your supply that is not covered under long-term agreements?

So we had anticipated and we're seeing raw material cost inflation on CTO. In terms of availability, we anticipate being able to get what we plan for. That's what we entered the year believing and our outlook for the year continues to demonstrate that.

We'll put another way, and I mean out of call it 320,000 tons of stuff that we're using pretty much everything for the years under contract for about except for about 15,000, right? So we're going into the year and this sort of always is the case. We go into the year. We have great line of sight for 2022.

And I guess the other thing to add, and as was mentioned in the script, we have anticipated the inflation. We're seeing that inflation. But from a market standpoint, our price increases continue to go very well, and we believe in the pine chemicals market, we're going to be able to more than offset any inflation in CTO with price increases during 2022. Okay, great.

Thanks. If I could ask, One more briefly on performance materials. I'm just wondering if there's any progress that you can share on your A&G technology and have conversations changed at all, particularly on the fleet conversion side as we've seen fuel prices surge recently?

Yeah, Vincent, this is Ed. We're actually seeing kind of great opportunities in front of us with the fleets that we're engaged with. We're engaged with over 50 fleets that range from natural gas utilities to municipalities to energy industry companies. The challenge we're having is the same that we're having across the United States in that the availability of pickup trucks are constrained. Once we get more vehicles in production, able to build inventories of more trucks, we do expect to expand not only the number of volume that each fleet will be using within their industry.

All right, great to hear it. Thanks again, and good luck on the rest of the year. All right, thank you.

The next question comes from Chantan Wanting from CJS Securities. John, your line is open. Please go ahead.

Hi, good morning, everyone. Thank you for taking my question. I was wondering what your... Can you hear me? Go ahead, John. Okay, thank you. I was wondering what were the exact expectations for auto unit sales within the ranges of your guidance, the brackets, I guess, that you're thinking about?

Yeah, you're breaking up a little bit, John. I don't know if we have a problem with our line. Just can you say it one more time? I know you're talking about auto guidance, but repeat the question.

Yeah, I was just wondering what the assumption is for auto unit sales at the low end or the high end of your guidance, or just the number of units that you were thinking about?

Yeah, John, this is Ed. You know, typically when we're looking at auto volumes, we primarily focus on our highest value market, and that would be North America. Right now, let's see, ended up in 2021 at 13 million vehicles in North America being produced. IHS is forecast as currently 15.2 million vehicles for 2022. And so we're effectively following IHS numbers as far as what we are plugging into what our economics will be for the full year of 2022.

Okay, great. And then I was just wondering if you guys had any commentary just on any exposure to Eastern Europe and the conflicts there. Either on the supply or demand side, have you thought about that, and what are you doing to mitigate that risk?

Yeah, I mean, look, I'll kind of take that more broadly, right? I mean, look, as you guys know, we're somewhat fortunate in that we're a pretty U.S.-centric business. Europe, as a percentage of sales, is sort of 16%, and in fact, we went through and it looked Eastern Europe writ large, so that includes all of the countries that are contiguous to the former, or I guess Russia, is about 4% of sales, right? So It's not a huge number. It is true that there is some auto production in Poland, right? So Poland obviously is not, while it's adjacent to all this, is not being affected by the activities in Ukraine. So, I mean, obviously to the extent this causes disruptions and markets globally, there'll be some impacts to it. But directly speaking, the situation in Ukraine is not going to affect longevity.

Okay, great. And if I could sneak one more in there, just any update on the Euro 7, you know, mandates and when they might be officially set.

Yeah, go ahead. Yeah, this is Ed. I'd like to talk about Brazil first. So we've got implementation of new regulations in Brazil. We feel that as it's implemented this year, we'll go from low single-digit millions last year on the high single-digit million, so we're seeing good regulatory growth in Brazil. Euro regulations are still kind of under review. The first draft has kind of been pushed into June, so we'll be kind of working around what that means for us towards the middle of the year. And then China and China 7, which is effectively implementing a Tier 3 U.S. style, we still expect implementation to be around 2026 at the earliest, but all three of those, obviously with Brazil already implementing, Europe looking at implementing, and China looking at implementing, we're very confident that we're going to see some nice regulatory growth over the next several years.

Okay, great. Thank you.

As a reminder, if you'd like to ask a question today, please press star 1 on your telephone keypad to queue up. Our next question is from Mike Sison from Wells Fargo. Mike, please go ahead. Your line is open.

Okay, good morning. Congrats on a strong end of the year. I guess for performance materials, you did a really nice job of getting pricing. How much of that pricing flows through into 2022, and do you need to seek more pricing if the inflation outlook gets worse from here?

Yeah, this is Ed. We've obviously had a very good, sizable price implementation, and it kind of doubled over. We had two price increases that compounded in last year. We do have more pricing coming in this year, and we'll continue to add price across our business as necessary.

Okay. And then in terms of the guidance for 2022, When I think about performance materials, do you get most of the EBITDA growth in the second half of the year, given kind of the commentary that, you know, you still have some microchip issues in the first half?

Yeah, I mean, I think of it as being sort of symmetric, right? I mean, if Q1 and Q2 were strongest last year, Q3, Q4 weaker last year, Our guidance sort of assumes a reversal of that, so a weaker Q1, Q2, with some improvement in Q3, Q4. And, you know, as I said in the prepared comments, I mean, to the extent this happens quicker or with more force, you know, we would see ourselves moving towards the higher end of that guidance. And, you know, as we also mentioned, I mean, look, from our best guesstimates, we think $60 or $70 million of revenue was sort of lost this year because of this. That should give you some sense of sort of the order of magnitude of what the snapback could look like. It's just a question of how that sequence is in and over time.

Right, right. Okay. And then just one follow-up on performance chemicals in terms of pricing as well. Again, another good quarter there in terms of pricing. You fully offset inflation. Okay. Does it become incremental to EBITDA as we head into the first half of the year, or is it more catch-up and then maybe a little bit more incremental in the second half of the year?

I actually think the pricing overall for the year, the pricing improvement in dollars, will more than offset those inflationary costs significantly. energy, raw materials, logistics, etc. As you can see from the trajectory, you know, essentially half of the price increase for the entire year occurred in the fourth quarter. So I think that from a comparative basis we're going to, you know, start to see, you know, a significant price increase versus prior year as we start 2022.

Got it. Thank you.

The next question comes from Paratosh Misra from Barab Derenberg. Paratosh, your line is open. Please go ahead.

Thanks, and good morning, everyone. What are you seeing in your energy business? Are you anticipating a big improvement in sales this year versus last year? Energy?

Energy, yeah. The oil field? Absolutely. That's correct, yeah. Absolutely. We had a great Q4. The outlook this year versus last year looks very strong. And, you know, it's as much of a matter of supporting our highest margin business and really pushing a price increase across all the pine chemical businesses, which, of course, includes our oil field business.

Got it. And how should we think about margins in your two segments in going from Q4 to Q1, given all these moving parts, you know, inflation and whatnot? Are you expecting margins to improve as we get into Q1 on a sequential basis?

Yeah, I mean, you know, Paritas, as you know, and we've said this for years, right? I mean, you have to be very careful looking at our business quarter by quarter because, you know, A, you've got that sort of asphalt seasonality that goes in, and then B, the businesses, you know, Engineer Polymers is a good example. You know, it's called a $185, $200 million business. If it takes an outage, it can have an impact in any given quarter, right? So you have to be sensitive to that. What I would say is, as we talked about, I think our expectation is that In Q1, the performance chemical segment will move to more normalized margins from what you saw in Q4. There's a couple of reasons for that. We had some downtime in the UK in engineered polymers. Asphalt, you know, winds down. It's typically our weakest quarter for margins. But we see Q1 normalized into what I would say is a more normalized, you know, run rate margin for that business on more of an annualized basis recognizing that you know first quarter is a little weaker than sort of the average for the year right another way of thinking about that is that revenues are going to catch up with some of the price the price increases will take hold relative to some of the costs that they've dealt with right and i think with regards to pm it's really not going to be that different from where we set you know in q4 this year so

Got it. Thanks, John. And maybe if I could ask one last one. With regard to your activated carbon for methane capture applications, can you provide some color as to what you're seeing there and if you're factoring in any sales to that market in your forecast for this year?

We're not really factoring in direct sales this year, although we may get some. You know, our green gas initiatives are frankly ahead of plan, and they continue to have opportunities, and you will probably see us continue to invest in that business and others like it. But we take a pretty conservative approach prior to us, you know, forecasting to the extent things are accelerated there, that would be upside to the forecast we have. We see it being more of a revenue contributor in 2023 and 2024.

Thanks, John. All the best for the year.

Yeah, thank you.

And a final reminder, if you'd like to ask a question today, that's star one on your telephone keypad. Our next question comes from John McNulty of BMO Capital Markets. John, your line is open. Please go ahead.

Hi, John. Hi, this is Caleb. This is Caleb. I hope that's all right. That's all right. Go ahead. Thanks, and congrats on the quarter. I just had a really quick question. I believe in your prepared remarks, you signaled out you had some share gains in adhesives, and I was just wondering if you could unpack that a little bit.

Yeah, sure. I mean, look, adhesives represents a tremendous market opportunity for us, right? When you look across the landscape, obviously, first off, the adhesive market is quite large when you look at all of the different types of adhesives that are out there. Historically, our focus, vis-a-vis our sort of more direct competitor, has been away from adhesives and into other applications. But I think we did a great job this year, and my hat's off to the industrial specialties team and Rich is here. We did a really terrific job in being able to deliver supply to customers who needed it in a pretty dynamic and stressed environment. And as a result, we've gained share. We expect to keep that share, and we expect to grow that business. I mean, we have a huge opportunity on a relative basis. Those of you who know us know that our adhesive business is sort of maybe a fifth or a sixth of the size of one of our competitors. So we have an opportunity there, and we will continue to be aggressive. So I don't know if there's anything else you want to add.

No, but thanks for the question, John. Our adhesives business, as you probably already know, is heavily weighted towards the road-striping aspect of the business. But certainly, we've seen expansive growth in the packaging side, particularly into the Asian markets in Europe in this last year. So we're really excited about that. And as John said, we still see a wealth of opportunity out there for this particular area of business for us. Thank you. Okay. Thank you. That was it.

Nothing further in the queue, so I'll hand back to Mary Hall for any closing remarks.

Thank you all. This concludes our call, and thank you for your interest and longevity.

This concludes today's call. Thank you very much for your attendance. You may now disconnect your line.