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spk06: Good morning and welcome to the Prestige Consumer Healthcare Fiscal 2023 Earnings Conference Call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad. To withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to Phil Terpiloli, Vice President of Investor Relations and Treasurer. Please go ahead.
spk02: Phil Terpiloli Thanks, operator. Thank you to everyone who's joined today. On the call to me are Ron Lombardi, our Chairman, President, and CEO, and Christine Sacco, our CFO. On today's call, we'll review our first quarter fiscal 23 results, discuss our full year outlook, and take questions from analysts. The slide presentation accompanies today's call. We can access it by visiting prestigeconsumerhealthcare.com, clicking on the Investors link, and then on today's webcast and presentation. Remember, some of the information contained in the presentation today includes non-GAAP financial measures. Reconciliations to the nearest GAAP financial measures are included in the earnings release and slide presentation. On today's call, management will make forward-looking statements around risks and uncertainties, which are detailed in a complete safe harbor disclosure on page two of the slide presentation that accompanies the call. These are important to review and contemplate. Business environment uncertainty remains heightened due to COVID-19 and various other geopolitical factors which have numerous potential impacts. This means results could change at any time, and the forecasted impact of risk considerations is a best estimate based on the information available as of today's date. Further information concerning risk factors and cautionary statements are available in our most recent FCC filings and most recent Company 10-K. I'll now hand it over to our CEO, Ron Lombardi. Ron?
spk01: Thanks, Phil. Let's begin on slide five. We are pleased with our start to the year, which continues the momentum from our record fiscal 22, which we completed back in March. This success is driven by the business attributes of our leading 100% consumer healthcare platform and the execution of our time-tested value creation strategy. Thanks to this strategy, we achieved net sales of $277 million in Q1, the highest level of quarterly sales in our company's history and slightly ahead of what we anticipated back in May. Our organic business trends were healthy throughout our portfolio, aided by consumer demand and our long-term brand building. This included a strong performance from our international segment and the HydroLite brand, which I'll touch on in a bit more detail momentarily. Our strong sales translated into strong profitability, generating $1.09 in diluted EPS and nearly $60 million in free cash flow. We also achieved an approximate 34% EBITDA margin despite the volatile supply chain and inflationary environment affecting our industry. Our predictable and consistent cash flow profile continues to enable our disciplined capital allocation strategy. In Q1, we executed a portion of our share repurchase program while maintaining a leverage ratio of 3.8 times. Now, let's turn to page six and discuss Hydrolyte in more detail. Hydrolyte continues to lead the robust growth of our international segment thanks to its leading number one share position and proven brand strategy. The Hydrolyte brand defines oral hydration on Australia, representing over 90% of the category. The majority of Australians recognize the brand immediately thanks to its great tasting profile, efficacy, and our proven brand building efforts. In Q1, all of Hydrolyte's various form factors, liquids, powders, tablets, and more, grew consumption in the mid-double digits versus prior year. As shown on the left side of the page, this impressive growth is a continuation of a much longer trend for the brand, driving both increased household penetration and usage over time. Our Hydrolyte brand has been synonymous with oral hydration for Australians over the last 20 years, and we see continued opportunity ahead. We continue to use targeted messaging, extend usage occasions, and execute various other marketing tactics. This leaves us well-positioned to drive growth of the category and the Hydrolyte brand into the future. Now let's turn to slide seven. Our long-term sales growth. is enabled by very strong financial profile that enables us to invest behind our brand building, including innovation. Each of our brands operate with a multi-year product development pipeline designed to ensure that we continue to understand and meet the needs of consumers. When we introduce new products, they are typically designed by using consumer insights to capitalize on market opportunities which drive brand and category growth. These products are designed in new and efficacious ways to help consumers take care of their health and ensure a superior experience. As the innovations come to market, we work with our retail partners to provide key channel support to drive consumer awareness of these new items. Featured on the left are two recent examples of the strategy at work. The new Summer's Eve spa line expands the brand into luxurious self-care that consumers seek. Since launching, we've turned on an impressive omni-channel campaign to inform consumers of the spa difference in both a traditional wash form and a serum designed for skin hydration. Clear Eyes Allergy is a new prescription strength once-a-day drop designed for relief from indoor and outdoor allergies. Leveraging our social media influencers, such as Hillary Roda, shown here, we are driving consumer awareness across TV and digital channels during the summer allergy season. So in summary, the products shown here are just two recent examples of our time-tested innovation playbook, and we look forward to new products driving growth going forward. Now, I'll pass it to Chris to walk through the financials.
spk10: Thanks, Ron. Good morning, everyone. Let's turn to slide 9 and review our first quarter fiscal 23 financial results. As a reminder, the information in today's presentation includes certain non-GAAP information that is reconciled to the closest GAAP measure in our earnings release. Q1 revenue of $277.1 million increased 2.9% versus the prior year, but declined 1.2%, excluding the effects of foreign currency and our acquisition of ACORN. North America revenues were approximately flat versus prior year and down mid-single digits, excluding acorns. As a reminder, Q1 faced a unique comparison in the prior year when we experienced dramatically higher sales as consumers shifted habits, most notably in travel, with increased vaccination rates. Our international segment revenues of $34.5 million were up over 30% in Q1, excluding FX, led by the Hydrolyte brand strength Ron discussed earlier. As expected, EBITDA and EPS both declined slightly in Q1 from the unusual prior year, but EBITDA margin remained consistent with our long-term expectations in the mid-30s. Let's turn to slide 10 for more details around consolidated results. As I just highlighted, our Q1 fiscal 23 revenues increased 2.9% versus the prior year. We experienced robust consumer demand across several categories, including cough and cold, where our chloroseptic, Ludens, and Little Remedies brands all experienced growth. We also continue to experience double-digit year-over-year growth in the e-commerce channel, continuing a long-term trend of higher online purchasing. Total company growth margin of 57.8% in the quarter declined 130 basis points versus last year's growth margin. This was as expected and attributable to the timing of cost increases and product mix. We continue to anticipate an approximate gross margin of 56% for both Q2 and fiscal 23, and we continue to institute pricing actions across our portfolio to offset the dollar amount of inflationary headwinds. Advertising and marketing came in at 14.4% for the first fiscal quarter. For fiscal 23, we still anticipate an A&M rate of just over 14% of sales. B&A expenses were 9.6% of sales in Q1, slightly higher than anticipated due to the timing of certain expenses, but we still anticipate full-year G&A dollars to approximate prior year at around 9% of sales. Finally, diluted EPS of $1.09 compared to $1.14 in the prior year, down from the factors previously discussed. Our Q1 tax rate of 22% was below prior periods due to the timing of certain discrete tax items, which generated a $0.03 EPS benefit. we still anticipate a full-year fiscal 23 tax rate of approximately 24%. Now let's turn to slide 11 and discuss cash flow. In Q1, we generated $57.2 million in free cash flow, down versus the prior year due to the timing of working capital. We continue to maintain industry-leading free cash flow and are maintaining our outlook for the year. At June 30th, our net debt was approximately $1.5 billion, and we maintained our covenant-defined leverage ratio of 3.8 times. We still anticipate being below 3.5 times leverage by fiscal year end and anticipate slightly higher interest expense versus the prior year. Lastly, in the quarter, we utilized approximately $38 million of the $50 million share repurchasing program authorized in May, repurchasing approximately 700,000 shares. With that, I'll turn it back to Ron.
spk01: Thanks, Chris. Let's turn to slide 13 to wrap up. Our business continues to have solid momentum, and we are reaffirming our full-year outlook thanks to our solid start to the year. For fiscal 23, we continue to anticipate revenue growth of approximately 3% to 4%, including organic revenue growth of 2% to 3%, consistent with our long-term targets. Q2 revenues are anticipated to be approximately $283 million, an increase of about 2.5% versus the prior year. We also continue to anticipate EPS of $4.18 to $4.23 for fiscal 23. For Q2, EPS is expected to be between $0.98 and $1. Our disciplined pricing actions and cost management are helping to offset inflationary headwinds, while the benefits of our strong free cash flow are expected to help offset the impact of higher interest rates. Lastly, we continue to anticipate free cash flow of $260 million or more. We still expect being below 3.5 times leverage by fiscal year-end as we continue to execute our disciplined capital deployment strategy that includes debt paydown. With that, I'll open it up for questions. Operator?
spk06: We will now begin the question and answer session. To ask a question, you may press star then one on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, please press star then two. At this time, we will pause momentarily to assemble our roster.
spk05: The first question comes from Stephanie Wissink with Jefferies. Please go ahead.
spk07: Hey, thanks, everyone. It's Chris Neiman. It's on for Steph today. Just curious to understand a little bit more of the strength in international, particularly if that's channel rebuilding or more kind of sustainable uptake. I asked just because I think it would seem counter-seasonal to me, but wondering if you could provide maybe a bit more color on the dynamics there. And I know you talked about it. I think your commentary is really suggestive of more trend sustainability, but any more color on how you're thinking about it would be helpful.
spk01: Sure. Good morning. So first of all, there is some usage for hydrolite during the cough cold season that there, that Australia is in the middle of right now. So not all of it's counter cyclical. Second part of it is, you know, it, Australia still goes through a distributor model, so it can be tough to predict the timing of distributor orders. So at this point, we're attributing most of the gain to timing. Got it.
spk07: And then maybe you just want to touch on really what's embedded within the guidance as it relates to cough and cold and the trends you're anticipating there. Any change in assumptions from the previous guidance based on what you've seen year to date?
spk10: Yeah, hey, this is Chris Morning. So no change really from our initial guide. You know, just as Ron was just mentioning on the international business, we think there may have been some timing benefits on retail order patterns for cough cold. As you can tell, very difficult environment to predict, particularly having a strong cough cold rebound in a non-seasonal fiscal Q1 period for us. So we'll watch it, but no change to the initial assumptions really.
spk05: Great, thanks. The next question is from John Anderson with William Blair. Please go ahead. Good morning, everybody. Thanks for the question.
spk01: Good morning, John.
spk09: First question is around really the recovery in I guess recovery or improvement in organic growth that is implied by the guidance or the balance of the year. Um, and, and, uh, what you're seeing, um, within the kind of consumer landscape, um, perhaps new products, um, just general, you know, business momentum that, that gives you confidence that, um, you know, we will see that recovery kind of play out in the way that you've kind of outlined for the cadence of the year.
spk01: Sure. So thanks, John. So first of all, the trends for our business have been pretty steady for quite a while now, and our outlook for the remainder of the year really is just a continuation of that. And the change in growth versus the prior year in upcoming quarters really is driven by – the comp period. In the first quarter last year, we benefited from a significant recovery in travel and other activities as people started to get out of the house again as they got comfortable with the COVID environment and that kind of thing. So it's really just a comp rather than a change in the underlying trends of the business.
spk09: Good. That's helpful to understand. Are we reaching a point now where the variations that we've seen over the past couple of years related to the pandemic and the impact on the consumer, is that going to be less of a discussion point, do you think, going forward? Now that, again, it sounds like we've lapped that comp, at this point. What's your sense of that?
spk01: Yeah, so if you look at our businesses' results last year after we got past the first quarter, it was pretty steady, and the trends have really continued that as we've gotten into fiscal 23 here. So it's going to be a bit steadier. You know, we continue to be in a hard-to-predict environment. As we sit here today, you know, COVID infection rates continue to peak from where they were even just a couple of months ago with the latest versions of COVID hitting us. I think the good news for us is that our business has proven to be fairly stable and doing well kind of no matter what kind of environment we're operating in. So tough to predict, but we continue to feel good that no matter what kind of environment we wake up into next quarter, next week, we're well positioned to continue to do well.
spk09: And, you know, we here have heard recently about, you know, excess inventory levels. Some retailers, I understand that's mostly outside of the categories in which you compete. But sometimes retailers will, you know, look to the categories that are faster turning in order to help address working capital productivity in the near term. Is there anything that you're kind of seeing from a customer perspective that would have the potential to impact your shipments relative to takeaway, which takeaway seems to be consistent, as you said?
spk01: You know, there's really no change in what we talked about back in May, which is, in general, in our space, I think most players would like to see more inventories. We'd like to have more inventory. We think our retail customers would like to have more inventory. This continues to be a very challenging supply chain environment. I think you're hearing many of the players in our space talk about a focus on service levels, and we'd like to see improved service levels going forward, but it just continues to be a challenging supply environment where you address one issue that's a challenge and another one pops up, And we're doing a good job managing through it. And I think a great example is our record level of sales this past quarter. So challenging environment, and I think there's probably more upside opportunity to the supply chain and inventory levels than there is downside.
spk09: Okay. And you seem to be doing quite a good job of timing or matching price and costs. At least, you know, you're kind of maintaining your gross margin outlook where, you know, we've seen more of many companies, you know, adjust that lower. What do you think, you know, that what's helping you kind of accomplish that, you know, whether it's just less inflation because of the nature of your products or perhaps, you know, your ability to get pricing into the market in relatively short order?
spk10: Yeah, John. Hi, this is Chris. I think it's both of those things. You know, we think for the most part, you know, we included the inflationary pressures we're seeing today in our initial guide back in May. Very fluid environment, as Ron said, but there's nothing material that has kind of popped up either on the pricing side, our ability to take price, or on the inflationary side compared to our initial guide. So more of the same and consistent.
spk09: Okay. And the last one, I'll pass it on. You know, your leverage ratio, is quite reasonable by historical standards for your business and you've been buying back some stock. I know you can't talk specifically about M&A, but what's kind of your posture right now towards capital allocation as we look forward over the next six to 12 months? And if some of the changes in the CHC marketplace because of pharma spinning off and you know, assets moving around? Does that, you know, perhaps influence or change the outlook for M&A?
spk01: So, first of all, the M&A pipeline, the activity out there has been consistent for a long time, and we expect it will continue to present opportunities like it has in the past for us. You know, our approach continues to be looking for the right kind of opportunities that fit with our long-term brand building focus. And the Theratiers brand acquisition last year at a good value for our shareholders within our long-term focus of continuing to reduce leverage is a great example of how we would look to execute M&A opportunities into the future. So we're going to continue to pay down debt and be disciplined in how we think about using our capital allocation going forward.
spk09: Okay, thanks so much.
spk01: Thank you, John.
spk06: The next question is from Mitch Penharo with Sturdivant. Please go ahead.
spk08: Yeah, hi, good morning. Hey, the question, I guess it was in your press release, but, you know, you do talk about dynamic supply chain and the inflationary environment, and that's, you know, obvious issues. But can you, I guess, talk about some specifics there, like what it is in the supply chain that's causing, you know, you said things are changing around. It's one thing one quarter, it's another thing the next quarter. So can you talk about that a little bit?
spk01: Sure. I think the factors that are causing the challenges in the supply chain for us are consistent with I think, most CPG companies. And the first thing, it starts with the suppliers having enough labor. I think we've all heard about companies struggling to hire. More recently, it's been related to absenteeism from COVID infections disrupting the supply chain. And then as a result of those factors, it's impacting deliveries of packaging material maybe trucking shortages, those kind of things. So it's these come and go disruptions into the supplier base or maybe a supplier supplier that is disrupting the predictable flow of product or expected flow of product from the suppliers.
spk08: Okay. And then, so how does that, You know, you talk about retailers wanting more inventory, and, you know, when you look at your, you know, your finished goods are up in the current quarter, which, you know, is consistent with that. Are we going to see, where do you think your inventories go from here? Are you going to need more finished goods, or are you just having trouble getting the finished goods?
spk10: Yeah, Mitch, it's Chris. So one thing to note, you know, as you're looking at our inventory levels, depends on what period you're comparing it to, right? If you're comparing it to last year at this time, remember we have about $6 million of inventory from the ACORN acquisition this period. But, you know, as we expected, higher costs are flowing through our inventory, right? So when we think about units, it's kind of similar. So most of the increase is really related to the expected inflationary measures. So that's just something to think about when you're looking just at, you know, dollar amounts of inventory.
spk08: Okay, that's helpful. And then with Terrateers, what's happening with that? Like, are you talking about any either, you know, marketing, extensions, the performance of Terrateers within your, you know, within your customer base? Any color around that would be helpful.
spk01: Sure. So in a lot of ways, it's the typical playbook that we execute during the first year of ownership, right? So we've got a year and one month under our belt, roughly, and we launched a new product. There are tiers extra preservative-free during the last year, so we got going on new products and innovation. We're looking for expanded distribution opportunities in regional food and drug and dollar products. are a couple of examples. And the marketing team has spent a lot of time working to further develop the marketing and communication plans for the brand. So you'll see updated marketing and TV advertising, for example. So it's no one thing. Mitch, it's a number of things from our playbook to get this thing going. And a year into it, we feel as good as we did day one or when we were doing diligence in terms of the long-term growth opportunities.
spk08: Okay. And I just, just two more quickies. Are you, have your sales been affected at all by, you know, just out of stocks? The fact that, you know, there are some inventory challenges at the retail level.
spk01: Yeah, we've, we've got pockets of, where we've had supply chain challenges that have caused out-of-stock at shelf that have come and gone over the last year or so. So we've had some pockets of it where it has impacted share and sales.
spk08: Is it effective? I mean, does it have a material effect? I mean, did it represent a 1% drag, a 5% drag? Is there any feel for that?
spk01: No, it hasn't been material to our overall performance. And for the most part, they've been short-lived. And we've found ways to recover and get back in stock. But it's the kind of thing that, as I described earlier, they come and go as we chase them. And we fix one, and a new one will pop up for the most part.
spk08: Okay. And then just last, Chris, the 22% tax rate, is that what we use for the year?
spk10: No, you should use 24% for each of the next three quarters in the full year. It was a one-time kind of discrete item in Q1. Okay.
spk08: All right. Thank you for taking the questions.
spk01: Sure. Thanks, Mitch.
spk06: The next question is from Rupesh Panik with Oppenheimer. Please go ahead.
spk00: Good morning. This is actually Erica Eiler on for Rupesh. Thanks a lot for taking our questions. So, I guess first I wanted to maybe touch on price gaps. Just curious how your price gaps look today versus, you know, private label and your other competition. And then, you know, just as you look at your categories, any meaningful changes in private label penetration lately, or is it more the same there?
spk01: So first, starting with the price gaps, they continue to be consistent with historic differences, whether it's between... branded competitors or private label. And again, for the most part, pretty much everybody has taken prices up as we've all adjusted to the inflationary pressure. So no real changes there. And in terms of private label share, we haven't seen any changes in the private label share or penetration or distribution. And we really don't expect any kind of change in the private label dynamic as we look forward.
spk00: Great. And then as you lap the prior year's strong performance, has anything been surprising in terms of what you're seeing at different retailers? Are you seeing a shift to discount channels or anything like that? And then secondly, as we think kind of about channels, the pharmacy channel, and I know we've asked you this before, but the pharmacy channels clearly benefited, you know, last year from, you know, foot traffic related to COVID vaccinations and testing. You know, just latest thoughts maybe on, you know, how you're thinking about the pharmacy channel, you know, over the next few quarters.
spk01: So if you look back over the last couple of years, we have seen some channels shift as consumers move to online, right? We've talked about how well we've done in Amazon and other dot coms. And there's been a resurgence in the pharmacy, the drug channel, as consumers shift shopping there to get boosters or COVID testing and that kind of thing. So, you know, as we sit here today, it's hard to predict. And we fall back to our long-term strategy of being broadly available and having broad distribution so that no matter where the consumer chooses to buy the product that will be there available for them as they look for their trusted brand. So as you think and speculate about what a recession might do to channel shifting, although we think about it, we're prepared to be ready if the consumer shifts from the channels I just mentioned back to some other channel as they look for better price value proposition, we'll be there ready for them. Yes. We've been successful through the change, and we think we're well-positioned to whatever happens going forward.
spk10: If I could just piggyback on that also, we talk about consistent profitability across channels. So should there be a shift like Ron just mentioned, we feel confident that our profitability will be sustained.
spk00: Okay, great. Thank you so much.
spk10: Thank you.
spk06: The next question is from Linda Bolton-Weiser with DA Davidson. Please go ahead.
spk04: Thank you. Yes, hi, good morning. So I was wondering, I know that the IRI track channel data does not at all tell the whole story, but nevertheless, it looks like that in the oral care category that you have been lagging the category a bit in your POS growth. I assume that would be DENTEC. Is there anything going on there, and would there be some reason why the share trends would be different in track channels versus non-track channels?
spk01: Yeah, good morning. Good morning, Glenda. So first of all, for our oral care products, where we have a big share of the guards, of the dental guards, a lot of that does flow through the dot-com channels, including Amazon, where we've had high levels of growth, and it's actually one of our top brands online. So there is, to your question, a big disconnect between IRI and and the oral care even more than our other categories. And we've continued to do well there.
spk04: So, like, if you looked at Dentech brand sales, like roughly what percent are the flosses and picks and things like that versus the dental guards, roughly?
spk01: Yeah, it's been a declining portion of our oral care business by design as we've refocused on better value and getting away from commoditized picks sold at retail. So I don't have the percentages off the top of my head, but it's steadily declined based on our strategy of focusing on other products in that category over the past few years.
spk04: Okay. And then... I was just curious with the, with the acquisition, I think obviously TheraTears is the most important brand, but I thought there were a few other little kind of pale brands that were part of that acquisition. Can you remind us what those were and have you made any decisions about whether those are keepers or whether they might be divestiture candidates?
spk10: Yeah. Good morning, Linda. This is Chris. So there were five other small brands, excuse me, four other small brands, five in total that came with the acquisition that, The most significant being diabetic tussin and Magox, which is a VMS supplement. So, you know, when you think about those, think, you know, in the $4 million to $5 million range a year type of thing. So not very large and performing generally as expected at this point.
spk02: And, Linda, no different than any other brand in our non-core portfolio there. serve a purpose in the portfolio of generating cash, but the focus with the acquisition was concentrated in Theracures.
spk04: Okay. And then I was just wondering, you know, a lot of investors are thinking about different things that happen in a recession, and there is some idea that if unemployment rises and people lose their health insurance or something like that, that there is a a trend toward more self-medication. Do you see that kind of trend being similar to other historic periods where you might see a bump in the category in a recession, or do you think something has changed that would make the situation different this time around?
spk01: Yeah, you know, at this point, we think kind of the trends and the things that we've seen kind of through 2008 and 2012 would be consistent if we enter into a recessionary period is, one, in these categories, it's kind of the last place people look to save money. When you're taking care of your health or somebody in your family, you stick with the brand and the products that have proven to work with you over time. And to your point, in the past, we have seen in an environment where people may lose health insurance that they're more likely to be proactive in treats on their own and actually start to treat ahead of things. So there was a bit of a boost from that in prior years. So we would expect those same kind of trends to be consistent if we enter into a recessionary period and consumers start to get pinched financially.
spk05: Okay. I guess that's it for me.
spk04: Thank you very much.
spk05: Thank you, Linda.
spk06: Again, if you have a question, please press star, then one. Our next question comes from Stefan Goulame with Sudoti. Please go ahead.
spk03: Hi, can you hear me?
spk01: Yep, good morning.
spk03: Hi, morning. This is Stefan Guillaume for Anthony Lebedzinski. Have you seen any meaningful changes lately to advertising and marketing rates?
spk01: Yeah, so they've been subject to inflationary pressures like most of the other input costs that we've seen. Our marketing group continues to look for ways to continue to be effective and efficient in their tactics and the marketing vehicles that they use. So it's not unlike any other factor that we deal with in an inflationary environment. We look for ways to save money and ways to continue to be effective in a rising cost environment.
spk03: Thank you. And what is your outlook for acquisitions?
spk01: Yep. So we'll continue to be consistent with past approaches of looking for opportunities that meet our long-term brand building criteria. So more of the same in that category. Okay.
spk03: All right. Thank you for picking my questions.
spk01: Okay. Thank you. Thank you.
spk06: Next, we have a follow-up question from John Anderson. Please go ahead.
spk09: Hi. Thanks for the follow-up. I'm just hoping to get a sense for what you're thinking regarding interest expense for the year with, you know, and this gets to kind of you know, your plans for the free cash flow for the year, obviously, and also, you know, kind of rate outlook. Any help there would be great. Thanks.
spk10: Hi, John. So we did call interest up a bit from the initial guide based on the fluid environment, right? We think we've been prudent in factoring rate hikes throughout fiscal 23. Think of it north of 3% on a LIBOR basis. But it was essentially offset with the benefit of the share repurchase we did during the quarter.
spk07: Okay, thanks.
spk06: This concludes our question and answer session. I would like to turn the conference back over to Ron Lombardi for any closing remarks.
spk01: Thank you, operator. Thanks again to everyone for joining us today. We're off to a nice start to the year and look forward to updating everyone again in November. Have a great day.
spk06: The conference is now concluded. Thank you for attending today's presentation you may now disconnect.
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