Navigator Holdings Ltd.

Thank you for standing by, ladies and gentlemen, and welcome to the Navigator Holdings Conference call on the first quarter 2021 financial results. We have with us Mr. David Butters, Executive Chairman, Mr. Harry Deans, Chief Executive Officer, Mr. Niall Nolan, Chief Financial Officer, and Mr. Oeyvind Lindeman, Chief Commercial Officer. At this time, all participants are in a listen-only mode. There will be a presentation followed by a question and answer session. At which time, if you wish to ask a question, please press Star 1 on your telephone keypad and wait for your name to be announced. I must advise you that this conference is being recorded today. And now I pass the floor to one of your speakers. Mr. Butters, please go ahead, sir.

Thank you, and good morning, everyone, and welcome to our quarterly conference call. Now, as we conduct today's conference call, we'll be making various forward-looking statements. These statements include, but not limited to, future... Thank you very much. are included in our annual and quarterly reports filed with the Securities and Exchange Commission. Now, before my handling over the call to one of us, to Harry and our London team, it might be a little bit helpful to look back to where we were at the end of last year. As we entered 2021, we were full of conviction that we had reached Thank you very much. Operating performance not seen since 2015. The February Texas freeze changed all that. Extraordinary natural events shut down the Texas and Louisiana electric grid for weeks and, more importantly, inflicted severe mechanical damage to the area's refining and petrochemical plants. Ethylene became scarce. Prices spiked to global highs. and domestic inventories depleted. No barrels moved through our terminal in March. During this period, we issued a force majeure on our terminal and our tightly scheduled ethylene vessels experienced complete disruption. Nevertheless, we generated positive quality results and an improved balance sheet. January's strong performance Offsetting a very difficult February and March showed us navigators' underlying strength and powerful earnings potential under normalized conditions. As Harry, Niall, and Oeyvind will shortly discuss, since the end of March, conditions have gradually improved, suggesting that we may still be entering into an environment more characteristic of those prevailing at the end of last year and the very beginning of this year. So now, just before I pass the call over to Harry and his team, I would like you to be sure you open up your website to Navigator's site and under the investor presentation section, refer to the supplemental information. I think that you will find to be very helpful as you follow along. So, Henry, why don't you pick up from there, please?

Thanks, David. Good morning to everybody in the call. I hope you're well and keeping safe. I'm pleased to report that Navigator Gas has performed robustly during the period and has had the best start to a year since Q1 2016. This is our fourth profitable quarter in succession, with income translating into an earnings of $0.05 per share. During the period, the company achieved adjusted EBITDA of $31 million, representing a 22% increase in the same period in 2020. This reflects both strong operational performance by the company, as well as the fruition and completion of our significant investment into the business in prior periods. The final capital contribution to our Morgan's Point Ethylene Terminal Joint Venture is was paid in late January, bringing our final investment in the terminal to $146.5 million. The shipping business has performed well during the period, and we look forward to more growth as the macro trading environment improves. And as we have previously announced, we complete the anticipated merger of UltraGas' fleet and business with Navigator. This transformative combination will create a fleet of 56 vessels which will enhance our market offering and provide much-needed flexibility and support to our customers. Ultragas's fleet of 7 more than 22,000 cubic metres handy-sized semi-refrigerated vessels, 5 12,000 ethylene vessels and 6 gas carriers under 10,000 cubic metres will position us to engage new clients in new markets. Through increased We anticipate that the enhanced scale and combined fleet will provide cost savings, significant strategies and efficiencies throughout the business. The additional vessels will allow us to capitalise on the structural growth of LPG and petrochemical gases being exported from the Rapano, Pemina and, of course, our own Morgans Point terminals, all of which are now on stream and ramping up exports. We believe these incremental volumes, combined with the extremely low level of handy-sized new build activity, as can be seen in slide 15 of the supplemental pack, will tighten the market, increase utilization rates, and further improve TCE rates. The proposed ultra-gas transaction is progressing well, and with completion expected early in Q3 2021, on the same commercial terms as agreed on the LOI, This combination is the cashless transaction with approximately 21.2 million shares being issued in Navigator's common stock to Ultranav and the assumption of approximately $197 million in Ultragas net debt as well as its working capital. When complete, the combination will introduce another major Navigator shareholder with long-standing experience in the maritime industry, which we believe will be beneficial for all our shareholders. The transaction is accretive to Navigator's standalone budget in terms of revenue, EBITDA and EPS, and we expect the combination to complete in line with our expectations, subject to concluding definitive binding agreements, board approvals and the other customary closing conditions. We were very pleased to announce in late April that Navigator had successfully won four 12-month time charters with Mitsui. utilising four of our semi-refrigerated handy-sized vessels to transport ambient propane from the newly commissioned Femner terminal in Prince Rupert, Canada to customers in Asia. This is a brand new trade route between the west coast of North America and Asia which by going directly across the Pacific bypasses the need for a Panama transit thus minimising transit times and boosting efficiencies. On its own This one deal ties up over 6% of the total handy-sized semi-refrigerated fleet. Over 6% and approximately between 13% and 18% of the available semi-refrigerated spot vessels. As discussed in a previous call, utilization rates finish 2020 strongly. and they continued into January, reaching 96%, before being hit by the headwinds of the southern freeze and the Mount Bellevue pipeline and subsequent Morgan's Point terminal force mesure in early February. Unsurprisingly, given these issues, utilisation rates dipped to the mid-80s, with the overall fleet utilisation ending the quarter at 88.2%. These rates continued into Q2 as olefin capacity started up and the U.S. domestic olefins pipeline was replenished, bringing with it strong domestic demand and pricing. This offered pressure on export volumes and the ethylene arbitrage. But thankfully, there are plentiful supplies of the most advantaged olefin feedstock in the U.S., ethane, which coupled with olefin overcapacity and the efficient ethylene market has again ensured product is priced to move. and as we've seen recently, the apps have opened again to Europe and to Asia. Our Morgan's Point ethylene terminal has now restarted and is ramping up throughput. We expect June's export volumes to be close to those of January 2021 and we anticipate exports for the remainder of the year to be at nameplate capacity of 1 million tonnes per annum. We are looking forward to running this unit at full rates to see if we can squeeze even more than the 10% incremental capacity we've already identified out of the plant. As previously discussed, the forward order book for new builds now stands at around 5%, with minimal vessel deliveries in 2021, 2022 and 2023. 20% of the entire handy-sized fleet is now more than 20 years old, So there's absolutely no pressure coming from vessel supply in our growing market. At long last, you may say, the three incremental U.S. export terminals have been completed and they're starting to export product. We estimate that these terminals, when running at full capacity, will require around 12 to 19 handy-sized vessels to service them, between 12 and 19. These tailwinds are helped by handy-sized exports, which are also ramping up at Marcus Hook, even before the Mariner East 2X project is completed later in the year. It's no surprise, therefore, that we maintain a positive outlook on short- and medium-term TCE rates and the handy-sized market in general, as there are a lot of factors that are starting to exert upwards pressure on rates. With incremental exports, limited new builds, improving customer sentiment and higher oil prices, it really does feel that we're on the cusp of a significant uptick in utilisation and market rates. With our existing fleet of 38 vessels, our FD&JB terminal now fully funded and fully commissioned, and with the company on the verge of a merger, which will dramatically grow our presence in the speciality LPG pit chem gas sector, Navigator Gas is poised to capitalise on these conditions. We expect that benefit, when it comes, to go straight on to our bottom line. With these few remarks, I'd like to hand you over to our CFO, Niall Norman, who will take you through our Q1 financials. Niall?

Thank you, Harry, and good morning all. The company generated net income of $2.8 million during the first quarter 2021, which compares very favourable to the loss of $8.2 million made in the first quarter of last year. Last year, of course, was negatively impacted by the initial market's reaction to COVID-19, as the world at large reacted nervously to what was about to unfold. Who would have thought that a year on, the lasting effects of the pandemic would still be impacting our lives? The recent quarter's profit has been the best since the first quarter of 2016. The total operating revenue from the vessels during the first quarter was $85.7 million, up $4.5 million from the $81.3 million generated during the first quarter of last year, but slightly behind the $87.4 million generated during the previous quarter. Average charter rates during the most recent quarter were $21,950 a day, or $667.830 per month, an increase from the $20,850 per day in the first quarter of last year, as well as an increase from the $21,100 achieved last quarter. Utilization, however, was more challenging during the quarter. As both David and Harry mentioned, January started very strongly with utilization of 96%. But following the mechanical integrity issues with the 16-mile pipeline between the ethylene caverns at Mount Bellevue and our terminal, creating a force majeure, as well as the Texas winter freeze that initially hit on February 15th, the vessels we had lined up to load ethylene at the terminal at that time were unable to do so, and had to suddenly find alternative employment. This affected their earnings and utilization fell to the mid 80% during February and March, resulting in overall utilization of 88.2% for the first quarter. And this compared with 89% for the first quarter of last year and 91% for the fourth quarter of 2020. The Luna pool earnings, which are derived from the current 14 vessels in the pool, are aggregated and allocated to pool participants in accordance with pool points, resulting in a net gain to the company of $1.1 million for the quarter from the other participants' vessels in the pool. Three vessels entered dry dock for their scheduled surveys during the first quarter, taking a total of 70 days. The cost of these The two dockings that were completed during the quarter was approximately $2.7 million. In total, 14 vessels are scheduled to be dry docked during 2021 for an anticipated aggregate 300 days and an estimated total cost of $18 million. Following the final capital contribution towards the construction of the terminal earlier in the first quarter, dry docking costs are the only remaining planned capital expenditures. for the company during 2021. Farge expenses decreased $1.9 million during the quarter to $15.6 million from $17.5 million from the first quarter of 2020. These are pass-through costs reflected in revenue, and the reduction resulted from both reduced bunker prices and bunker consumption. Vessel operating expenses were $27 million for the first quarter, equating to $7,892 per vessel per day, which is a 1.5% decrease from the vessel OPEX incurred during the first quarter of 2020. General and admin costs were $6.3 million for the first quarter, a 3% reduction on the $6.5 million incurred during the first quarter of last year. And the other income of $72,000 for the first quarter relates to management fees received from the other participants for our management of the Luna Pool. Interest costs for the first quarter were $9 million, 22.3% less than the first quarter of last year, primarily as a result of reductions in U.S. LIBR. Applicable U.S. LIBR Thank you very much. However, as Oeyvind will refer to, volumes are picking up and returning to normal. We did receive our first cash distribution of $850,000 from the JV during the quarter, based on the operational performance of January 2021. Net income for the first quarter was therefore $2.8 million, or 5 cents per share, compared to a loss for the first quarter of 2020 of $8.2 million, or a loss per share of 14 cents. Cash at March 31st stood at $85.2 million, an increase from the $59.3 million at the end of December 2021. We had a further $37.6 million available from undrawn revolving credit facilities associated with our secured vessel loans, taking total available cash to $122.8 million. In January, we made the expected final capital distribution of $4 million towards the construction of the Ethylene Terminal, taking our total contributions for the terminal to $146.5 million, which is under the budget set two years ago, before construction was started. And it was delivered on time and safely, a significant success given the pandemic-related challenges of the past 12 months. We drew this $4 million capital contribution from the terminal credit facility during the quarter, as well as a further $14 million which was available for general corporate purposes, resulting in that facility becoming fully drawn at $69 million. On reaching construction practical completion at the beginning of the quarter, the terminal facility was converted into a five-year amortizing term loan, attracting interest at U.S. LIBR plus 2.75%. Our total debt at March 31st stood at $849.6 million, which incorporates six bank loan facilities secured on our vessels, the terminal facility and two Norwegian bonds. There are no maturities on any of these facilities during 2021, and with the exception of an $18 million repayment in March 2022, there are no maturities on any facility until late in 2022. And with that, I'll hand you over to Oeyvind.

Thank you, Miles, and morning, everybody. If you take a look at page 8 of the supplementary presentation, the ethylene graph is quite telling on the right-hand side. It shows that global ethylene prices have gone through a roller coaster over the last six months. At year-end, U.S. ethylene prices stood at $700 a ton, The dark blue line. And U.S. ethylene exports reached an aggregate, i.e. from both Target Terminal and our Joint Venture Terminal, of 100,000 tons. Nearly 80,000 tons of this was exported through our Joint Venture Terminal. Now, we consider a total of 100,000 tons per month a normal state of operations from the U.S. Today the U.S. ethylene price is quoted at $670 a ton, nearly half of what it was during its peak in April. The U.S. ethylene price is projecting further backwardation, i.e. reducing in the future, and exports are increasing as a result of this widening arbitrage to international markets. And why is that? Well, we are seeing the fundamentals of continued cheap attain available in the U.S. and excess domestic production getting back up, which will move the market to a more normal state of play. And that is good for us. The export volumes are reacting positively, increasing month on month, as you can see on page 9. illustrating the aggregate US ethylene exports. As you can see, the exports are moving towards what we call the normal state of 100,000 tons per month for July. A high oil scenario further underpins the attractiveness of these derivatives produced by natural gas liquids. To put into perspective, these 100,000 tons of exports of exports of ethylene per month translates into about 16 hand-designed ethylene vessel demand, which from a fleet of 38 ships on the water today captures nearly half the available tonnage, which is quite extraordinary. We're also about to deliver the last of the four hand-designed semi-refrigerated ships to the Canadian West Coast LPG project, as Harry just mentioned. The first three have already successfully loaded from this new terminal and discharged in Northeast Asia. This is all incremental demand to our segment. Four LPG vessels are effectively removed from the spot market, deporting the rest of the fleet. It is the first structural handy-sized trade for LPG in the Asia region, with prospects of more to follow. The Rakano terminal in New Jersey is now operational. We loaded the first handy-sized cargo from this facility in April, and with two subsequent cargoes in May. This translates into incremental demand for one semi-refrigerated vessel, A demand for one additional vessel may not sound so much, but in a pool of only 63 units, every new opportunity can influence the supply and demand balance in our segment. One of the short-term challenges facing the general LPG export markets for all LPG ship owners is the lack of arbitrage today from the U.S. This is less impactful for the specific handy-sized projects that we have mentioned, but affects the shipping industry as a whole. Today, U.S. propane is priced at $1 per gallon, roughly, compared to about half a dollar per gallon at the same period during 2019 and 2020. And the inventory levels in Mt. Bellevue are lower, historically, by about 10 million barrels today. At the same time, domestic propane consumption has increased by 10% during the last couple of months. And the EIA gives an interesting explanation. Americans have been working from home due to COVID restrictions, and many have had to heat their houses with LPG. Under normal circumstances, they would have gone to the offices, which generally use electricity or natural gas for heating. Once LPG fundamentals normalize, we expect overall LPG exports to revert back to 2019 levels, supporting the wider business. In conclusion, though, the stars are very much aligning for our segment and for Navigator Gas. The ethylene fundamentals are reverting back to where they should be, creating demand for our ethylene Luna pool. The incremental demand from the hand-designed terminals are starting to take effect. We have a historic low order book negating any impact on the tonnage situation. Therefore, the overall market dynamics of the next half year show many similarities to what created the hand-designed high of 2015. And I'm surprising myself when I say this, but back to normal is good for Navigator.

Thank you very much.

Thank you very much, sir. Ladies and gentlemen, as a reminder, if you wish to ask a question, please press star 1 on your telephone keypad and wait for your name to be announced. Our first question today is from Sean Morgan from Evercore. Please go ahead. Your line is open.

Hey, guys. So we talked a lot about back to normal on the call. It's kind of a bit of a theme, but back to normal, we really haven't had a lot of normal because there's been all these sort of one-off disruptions that were sort of macro-related and exogenous to the company. So if we look at January as maybe a good benchmark for the ethylene export terminal, what does Q2 look like in terms of kind of utilization that you see in – I guess over the quarter of kind of a normalizing quarter. And how does that compare with Q3 if we can kind of hold the rates that we've seen in June so far?

Thanks, John. So it kind of illustrates part of the answer to your question is on page nine, the U.S. ethylene export graph. You can see the middle sort of peak there, which we call normal operation. Everything was as per standard, being 100,000 tons exported from the U.S. during that period of December, January. So then, of course, we know what happened, and you see that through March, April, May. So the utilization, as a result, didn't exceed 90%. It continued in sort of the same vein as the first quarter because of that and many more.

And then in terms of the actual dollar contribution for the income statement, are we still kind of targeting – I mean, it's been really lumpy, obviously, because of all these sort of one-offs, but are we thinking maybe like $9 million a quarter? Is that like a good – is that still kind of a good estimate, or was it 10% debottling? I'm thinking going to maybe bring that a little higher.

Sean, yeah, I mean, the – Terminal for Q2 is still going to be lumpy because of the reasons that both David mentioned at the outset and Oeyvind subsequently. I think from when we're talking about normal, we're talking about from June onwards. And we have said that at that level, it would be around the $20 to $25 million of EBITDA on an annualized basis. So it's about $6 million per quarter.

If I could just squeeze in one macro question real quick. In terms of the U.S. demand, I appreciate that the spreads are widening and that's going to be very advantageous, but are you contemplating a much more normal scenario for when we get back to the colder winter months and essentially a lower domestic consumption so that that spread can be maintained through the end of the year?

I think on the ethylene spread, our sort of belief is that that's not very much, it's not relating so much to seasonality because the feedstock is ethane. Now, if you talk about propane, LPG, yes, there is some seasonality in the U.S. market because traditionally consumption goes up in the winter for obvious reasons. What has caused kind of narrowing of LPG arbitrage from the U.S., not Etlin. LPG is this lack of reduction in production during the freeze, increased consumption, as I mentioned, about people working from home, which is quite interesting. And therefore, the arbitrage sort of reduces trade of LPG. Now, we don't do our business. Thanks for the time, guys.

Thanks, John.

And our next question for today is from Randy Givens from Jefferies. Please go ahead. Randy, your line is open. Please ask your question. Your line is open. Please go ahead and ask your question.

Okay. We might take another call if there is another one.

Yes, sir. We'll move to the next question. Ben Nolan from C4.

Please go ahead. Morning, Ben.

I have a couple though. So as you laid out, especially with the addition of the Pembina volumes, now within the course of a month and a half, I think you said 13% to 18% of all of the semi-refrigerated vessels are sort of dedicated to that trade at the same time. The last one is delivering...

in about 10 days' time. So then that is concluded. The ethylene terminal is getting back up to normal as we have discussed from July onwards. You also have potential merger happening in third quarter. So all these things should assist in a utilization rate trending positive. Thank you for joining us.

And then to that end, you know, I've just been keeping an eye on the day rate. And they've been okay, but they haven't really moved. And I thought that they might with the addition of, again, the Pembina terminal in the vessel sort of being incrementally taken out of the market. Do you think that's coming? Or is it the fact that the LPG... Arb isn't quite open enough and that sort of is keeping a cap on day rates. What would you sort of attribute that to? Or am I just being unreasonable?

I mean, the textbook is on supply-demand balance. So we remove available ships and there's no ships to replace that with. Therefore, it should be positive. Now, it's not like turning on a switch and it happens overnight. Our expectation is that it is happening, but over a short period of time.

Okay, so it's your anticipation that the day rates are probably moving up? Correct. And then lastly, for me, I could keep going, but Randy might be in the background somewhere. As it relates to the Epling Terminal, Things are kind of getting back up and running. I know pre the freeze that you guys had made mention that you were maybe talking with customers about potential additions to contracts and expansion and all these kind of things. In Colorado, whether that has recommenced or if you feel like there's You want me to take it, David? Are you going to take it? Mary, why don't you answer that?

That would be helpful. Yeah, okay, thanks, David. Thanks for the question, Ben. Yeah, obviously we're anxious to get the terminal up and running to its full capacity. And as I said in my prepared remarks, we think we've identified 10% that we can squeeze out. But we haven't really run it flat out yet. And when we run it flat out, we're semi-optimistic that there'll be more tons available. And as we've spoken about several times in this call, the Bestie bottleneck is a free one. We're spending a lot of money and we want to see some return from that money and see it flow back to our bottom line. But we're constantly in discussion with customers about expanding and we're constantly in discussion with customers about plans for the future for that terminal. But what we need to do now is actually sweat the asset and see it run and run reliably.

That is sort of the next. I suppose what you're saying is before we should expect to see any incremental announcements or whatever, you kind of need to get a little bit of time under your belt at full utilization. and so forth.

That's right. Let's sweat the assets and sell it out. Now, as we've talked again before in this call, the cheapest incremental ton of expansion capacity will be in our terminal. So if anybody is going to put another dollar into Essene Terminals, it will be us and our joint venture partners because all the infrastructure is already there. You've got the civils, you've got the jetties, you've got other infrastructure. All things being equal, any FDN terminal expansion will be in our terminal. It's just a matter of time. Right.

As you can imagine, Ben, since the terminal became operational over a year ago, what happened? Well, first came the pandemic that really knocked the pants off of everything, negative pricing of oil. Oeyvind Lindeman If you're trying to plan, if you're a buyer of ethylene and particularly a long-term buyer, you don't know what to look at at the moment. It's been such a distorted market. So I think those things have to settle down a bit. And as Harry says, you first focus on de-bottlenecking, getting the next 10% or 20% out of the existing capacity. and then as things settle down, negotiations on long-term supply and how to get those long-term supply barrels up and running and whether that's an expansion or whatever have you or a new facility, that would be the decision. But boy, it couldn't make any decision here in the last year and a half. Impossible. Right. Okay.

That's fine. I maybe skipped a little bit. Last question, just as a reminder, capital allocation priorities or near-term debt repayment, is that fair? For the terminal? No, in general. Yeah, but the company's capital allocation, we should expect you to be focused on debt repayment. Is that fair? Sorry, yes. Yes, yes. Okay. All right. All right. I appreciate it. Thanks.

As a reminder, if you wish to ask a question, please press star 1 on your telephone keypad. We have had Mr. Giveans come through again. Randy, your line is open. Please go ahead and ask your question.

Howdy, gentlemen. Can you hear me now? We are done, Randy. Life is clear. Reunited, and it feels so good. Two questions for me. First, does the ultra-gas merger... Does that limit any future plans for maybe expansion of the Echoline Terminal? And secondly, now that you have acquired some small LPG carriers, is there any appetite for further acquisitions and consolidation on the smaller LPG side?

Yeah, the first one, let me take it, Randy, no, it doesn't. So, you know, we're completing the mergers, the cashless mergers, you know. which is wonderful that it doesn't over-leverage our balance sheet and that will give us much more opportunity. So it's not either or. And the second question on the small vessels. You know, Randy, we're sort of looking at it as something that's new to us and we can't wait to actually get in because, as you know, we're not allowed to discuss certain things ahead of a close meeting. of the merger. So we can't wait to get in and talk more details with our new partners at Ultragas to find out how these vessels operate and where they operate and look for other opportunities with them. We know they're in a very strong pool called the Unigas pool, which has been around for a long period of time and those guys manage those vessels very efficiently and very well.

Got it. All right. And then I don't know if you answered this earlier, clearly I had some phone issues, but I'll ask it. Obviously on the Pembina, Rapano, great to see those both online. Were you able to quantify how many maybe handy-sized semi-ref vessels will be employed on those projects on an annual basis? I know you show some cargos per month in your slide deck, but seeing if you have an annual number on how many of those vessels are pulled out of the market.

Yeah, so Randy, excellent question. First part is easy to answer. So 10 in our one, there are four ships on 12-month charters, so they will then reflect four-ship demand on an annual basis. Now, they're also talking about a fifth ship, so there might be more coming from that opportunity. On the other side, on the Atlantic side, the Rapano Terminal, so we've loaded two cargoes in May, and that translated to a full employment for one ship. and that went to the Caribbean. So if those tons go further afield, well, they need more ships. Now, the specification or nameplate capacity of the Rapalmas, to the best of my knowledge, is 20,000 barrels a day or even more. Now, in the month of May, they only did 10,000, so half, so you'd safe to say That terminal, once fully operational, that they got, you know, experience under their belt, should be at least two anti-size ships on an annual basis. So if you combine both of them, then it'll be six or seven. And that is, you know, overnight going from zero to that number in our little segment is pretty cool. Sure.

Clearly impactful. I'm going to throw in a third question because I think I'm at the end of the queue, which is completely my fault. Sorry. You mentioned current utilization. I think high to mid 80% range, continuing to climb. Is that your expectation for 2Q and 3Q now as a run rate? And how has that higher utilization impacted some of the spot handy size shipping rates?

So utilization... As we talked about on this call, from Q1 to Q2, it's pretty much a straight line, so it's continuing that thing, as you just mentioned. Now, I think it was Ben's question earlier, in terms of third quarter, and for the reasons we discussed, those projects, ethylene ramping up and so forth, etc., we expect utilization for third quarter to be 90 plus. And is that kind of the threshold for when you really start to see rate inflection, trying to get the impact on rates? If you go back five months to January, where we had 95% utilization, it was fantastic. We've sensed it as being able to push the market in the right direction in terms of freight. So, if past experience is anything to go by, once you get 90 plus, you are getting into that zone whereby you can actually move the needle.

Got it. All right. Well, hey, thanks again for the patience, and it's been a long few years, but great to see things heading in the right direction. Thank you. Thanks, Wendy. Thank you, Randy.

Thank you, ladies and gentlemen. I'll now hand back to your speakers for any closing comments.

Okay. Well, thank you very much for joining us this morning, and let's hope we don't have any other disruptions before our next call, and look forward to that. Thank you very much.

Thank you very much sir. Ladies and gentlemen, that does conclude the call. Thank you all for joining and participating. You may now disconnect.