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spk07: Good day and thank you for standing by. Welcome to the first quarter 2022 Parsons Corporation earnings conference call. At this time, all participants are in listen-only mode. After the presentation, there will be a question and answer session. To ask a question during the session, you'll need to press star, then 1 on your telephone keypad. Please be advised today's conference may be recorded. If you require operator assistance during the call, please press star, then 0. I'd now like to hand the conference over to your host today, Dave Spilly, Senior Vice President of Investor Relations. Please go ahead.
spk04: Thank you. Good morning, and thank you for joining us today to discuss our first quarter of 2022 financial results. Please note that we provide presentation slides on the Investor Relations section of our website. On the call with me today are Kerry Smith, President and CEO, and George Ball, CFO. Today, Kerry will discuss our corporate strategy and operational highlights, and then George will provide an overview of our first quarter financial results. We then will close with a question and answer session. Management may also make forward-looking statements during the call regarding future events, anticipated future trends, and anticipated future performance of the company. We caution you that such statements are not guarantees of future performance and involve risks and uncertainties that are difficult to predict. Actual results may differ materially from those projected in forward-looking statements due to a variety of factors. These risk factors are described in our Form 10-K for fiscal year ended December 31, 2021 and other SEC filings. Please refer to our earnings press release for Parson's complete forward-looking statement disclosure. We do not undertake any obligation to update forward-looking statements. Management will also make reference to non-GAAP financial measures during this call. We remind you that these non-GAAP financial measures are not a substitute for their comparable GAAP measures. I now will turn the call over to Carrie.
spk01: Thank you, Dave. Good morning, everyone, and welcome to Parson's first quarter 2022 earnings call. We delivered strong first quarter financial results and continued the momentum established in the second half of 2021. We generated healthy organic revenue growth in both business segments, reported our highest first quarter adjusted EBITDA on operating cash flow since our IPO in May 2019, won three contract awards over $100 million, and continued strong hiring and retention. For the full year, we are reiterating our guidance across the board. During the quarter, we generated total year-over-year growth of 9% with contributions from both segments and all four business units. Our year-over-year organic revenue growth was 6%, including 8% within our critical infrastructure segment and 4% within our federal solutions segment. We also grew adjusted EBIT off 8% year-over-year and improved operating cash flow by $40 million from the prior year period. I attribute this success to both our strategic evolution to an integrated solutions provider as well as our strong operating discipline. We lead with differentiated technology, have proven our ability to recruit and retain employees, and have a strong position in two complementary, enduring, high-growth markets that are well aligned with macroeconomic trends and United States federal government priorities. This balanced portfolio across critical infrastructure and national security markets is a differentiator for Parsons. We continue to be excited about the position of our critical infrastructure business given global demand. In the United States, the infrastructure bill priorities of transportation, environmental remediation, and water and wastewater treatment align well with persons' capabilities. We're also seeing increased infrastructure spending in Canada, and continued oil price strength is enabling our Middle East customers to move forward with new projects. Demand for our federal solutions capabilities, such as cyber, space, missile defense, and C5ISR is rising due to the threat environment focused on technologically advanced near-peer competitors. Today, we're facing increased cyber attacks from nation, state, and other actors. We have a space race that's increasingly crowded and contested, and which includes anti-satellite and hypersonic threats. Parsons is well-positioned to offer solutions to address many of these challenges. Our two segments are highly complementary, and we're uniquely positioned with our collective credentials. We're bringing federal capabilities in cyber, artificial intelligence, data analytics, and cloud-enabled solutions to our critical infrastructure customers. We also leverage our expansive critical infrastructure capabilities in design, program management, and environmental planning and remediation to our federal customers. We will continue to benefit from our balanced portfolio as threats evolve and the world becomes more connected and reliant on data that's essential to our national security interests and our ability to safely and efficiently move both people and goods with resilient and sustainable infrastructure. Our ability to successfully deliver on our customers' missions continues to enable us to win large strategic contracts. During the first quarter, we won three contracts valued at more than $100 million. We were awarded an option year exercise for $118 million by the United States General Services Administration under the Combatant Command Cyber Mission Support Contract. Under this contract, which represents new work, we will be researching, developing, testing, and evaluating tailored cyber solutions for cyberspace operations, advanced concepts and technologies, and integrating operational platforms. We also received $116 million of contract growth on our FAA program for modernizing the United States National Airspace System. The bipartisan infrastructure bill provided $5 billion to replace air traffic facilities, update and upgrade equipment including landing and navigational aids, and improve safety, security, and environmental standards at facilities. And this FAA contract is a great representative example of the complementary nature of our federal solutions and critical infrastructure segments. As noted on our last earnings call, we were awarded a new task order to provide testing solutions in response to the COVID-19 pandemic for the Department of Homeland Security, Immigration, and Customs Enforcement facilities across the United States. This award has a potential total ceiling value, including surge capacity, of more than $100 million. Realization of this ceiling value will depend upon the future of the pandemic and the long-term need for testing. In the first quarter, we also won two Middle East contracts worth a combined value of over $75 million related to Saudi Arabia's Vision 2030 to redefine urban living in industrial cities within the kingdom. After the first quarter closed, we received a $149 million contract value increase on a program management contract for the Riyadh Metro Program, which is the largest metro system development project in the world. Also after first quarter closed, we were awarded a $75 million task order contract by a rail customer for a series of infrastructure projects. Parsons remains a leader in the rail transit sector, and we're pleased to see the strong investment of our nation's rail system in the Infrastructure Investment and Jobs Act. Collectively, these awards highlight our ability to staff new contracts and successfully deliver on our customers' missions. as well as win contracts in well-funded areas of national security and infrastructure importance. Our competitiveness is tied to our team's effort and talent, but also the capabilities that we've added to our portfolio through strategic M&A. During the quarter, we also received notable recognition for our diversity and inclusion initiatives, and we were named one of the world's most ethical companies by Ethisphere for the 13th consecutive year. A summary of the specific ESG awards we won during the quarter are listed in today's earnings press release. We have a strong commitment to ESG, which is interwoven within our core values, how we operate as a company, and the portfolio we deliver to our customers. Accordingly, we made a strategic hire of an ESG vice president to lead this important function across persons. In summary, we delivered a strong first quarter. We generated healthy organic revenue growth in both segments, reported our highest first quarter adjusted EBITDA and operating cash flow since our IPO, continued to win large contracts, maintained our hiring momentum, and continued to be recognized as an employer of choice. These results build on our momentum from the back half of last year. As I look forward, I am very excited about our business. We are well positioned in two growing, enduring, and complementary markets. We have made significant strides in recruiting and retention and solidified our base of business by winning all major recent repeat contracts. We have over two years of revenue and backlog and a strong balance sheet that will enable us to continue to make ongoing organic and M&A investments to drive growth and expand margins. With that, I'll turn the call over to George to discuss our first quarter financial highlights. George?
spk10: Thank you, Carrie. As Carrie indicated, first quarter results were highlighted by delivering organic growth in both segments, margin expansion, and cash flow improvement. Total revenue for the first quarter of 2022 increased 9% from the prior year period and was up 6% on an organic basis. Organic growth was driven by the ramp-up of recent contract awards. SG&A expenses decreased by $2 million, largely due to lower intangible asset amortization and stock-based compensation expenses, partially offset by acquisition SG&A expenses. Adjusted EBITDA of $74 million increased 8% from the first quarter of 2021, and adjusted EBITDA margin was 7.8%. The increase in adjusted EBITDA was driven primarily by contributions from recent contract awards and acquisitions. I'll turn now to our operating segments, starting first with Federal Solutions, where first quarter revenue increased by $40 million, or 9%, from the first quarter of 2021. This increase was driven by organic growth of 4%, and approximately $20 million from acquisitions. Organic growth was driven by the ramp-up of recent contract awards. Federal Solutions adjusted EBITDA increased $11 million, or 33% from the first quarter of 2021, and adjusted EBITDA margin increased 160 basis points to 8.7%. These increases were driven primarily by recent contract awards and contributions from acquisitions. Moving now to our critical infrastructure segment. First quarter revenue increased by $35 million, or 8% from the first quarter of 2021, all of which was organic. This increase was driven primarily by the ramp-up of recent contract awards and increased hiring activity. Critical infrastructure adjusted EBITDA decreased by $5 million, or 14%, from the first quarter of 2021, and adjusted EBITDA margin decreased to 6.9%. These decreases were driven primarily by a change order on an unconsolidated joint venture project, which has the effect of delaying profit to future periods. While this change order had a negative impact on adjusted EBITDA and margins in the first quarter, it will in fact increase future profits, and we anticipate that both the first quarter negative impact and increased profits from the change order will be realized in full by the end of 2023. Next, I'll discuss cash flow and balance sheet metrics. Our net DSO at the end of Q1 2022 was 76 days, compared to 71 days at the end of the first quarter of 2021. During the first quarter of 2022, we used $26 million in operating cash flow, compared to a use of $66 million in the prior year period. The $40 million improvement was driven by lower payments on our pre-IPO executive compensation plans and increased profitability. Capital expenditures totaled $4 million in the first quarter of 2022, equivalent to the prior year period. Our balance sheet remains strong as we ended the quarter with a net debt leverage ratio of 1.0 times. Turning to bookings for the first quarter, we reported contract awards of $917 million, representing a book-to-bill ratio of 1.0 times. On a trailing 12-month basis, our book-to-bill ratio remains a healthy 1.2 times, with federal solutions at 1.3 and critical infrastructure at 1.1. Our backlog at the end of the first quarter totaled $8.2 billion, up 1% from the first quarter of 2021, and total backlog continues to represent more than two years of annual revenue. Now let's turn to our guidance. We are reiterating all of our 2022 guidance ranges provided on February 23rd based upon our financial results for the first quarter of 2022 and our outlook for the remainder of the year. For revenue in the second and third quarters, we expect low single-digit revenue growth year-over-year and then down sequentially in Q4 due to seasonality. For adjusted EBITDA, we expect year-over-year growth of 10% to 15% in both Q2 and Q3 and then down sequentially in Q4. For operating cash flow, we expect sequential improvements as we move through the balance of the year. Other key assumptions in connection with our 2022 guidance are outlined on slide 10 in today's PowerPoint presentation located on our investor relations website. With that, I'll turn the call back over to Carrie.
spk01: Thank you, George. We're pleased with our first quarter results. This quarter, once again, demonstrated our momentum, the durability of our growth, and increasing operational consistency. I continue to be impressed with our team's hard work, ability to deliver on our customers' critical missions, and our position in two enduring markets that are well aligned with macroeconomic trends. Our team is executing well in what is a very dynamic environment, and we're postured to drive continued top-line growth and margin expansion. With that, we'll now open the line for questions.
spk07: If you'd like to ask a question at this time, please press the star, then the number one key on your touch-tone telephone. To withdraw your question, press the pound key. Our first question comes from Sheila Caillou with Jefferies.
spk00: Good morning, guys. Thank you for that time and good quarter. Thank you very much, Sheila. I wanted to ask about, you know, just the Q1 dynamics. You know, revenues were better than we expected and that you previously laid out. Can you talk about what's driving that strength and how you expect that to progress? Can you maybe talk about your cyber exposure, how big it is? Are you seeing any sort of benefits there from what's going on?
spk01: Sure, Sheila. Thanks very much. The dynamics as far as the drivers are first, continued hiring momentum. We're really pleased with that. As we indicated the second half of last year, we were up 30% over the first half, and that momentum continued into this year. In fact, Q1 2022 was our best quarter since Q1 2019 in terms of hiring. We have indicated in the past we had won a lot of work, and we just really need to get the jobs staffed. I would say we're also doing a great job on the single award contracts of driving new task orders and work to those vehicles. In terms of cyber, that's a portion of our defense and intelligence organization, and that's an area we continue to look for growth, both as far as supporting Department of Defense and the intelligence community, but also looking in areas such as critical infrastructure protection.
spk00: And then just on the hiring, can you help frame that a little bit? You said it was the best quarter since 2019 Q1. You know, what is, you know, the hiring growth and like what is expected? What do you expect it to grow for the full year? And how is inflation a factor in that, if at all?
spk01: Yes, from a hiring perspective, we made quite a few changes back in July of last year, and I think that was really to our benefit and really strengthened our human resources team. And we've seen a big improvement. We've also revisited kind of all of our HR programs to make sure that we're best in class and employer of choice. So that has really turned the needle for us. And we've been able to sustain that momentum, which we see as very positive. As far as inflation, I indicated on the last call that we were kind of planning for around a 3% to 3.5% increase. And that's where we currently sit. But it is something that we're going to continue to watch as we go throughout the year and see what it looks like for the full year.
spk00: Okay.
spk07: Thank you so much. Thanks.
spk01: Thanks.
spk07: Our next question comes from Gavin Parsons with Goldman Sachs.
spk03: Hey, good morning.
spk01: Morning, Gavin.
spk03: George, I apologize if I've missed it. Did you quantify the size of the critical infrastructure adjustment?
spk10: Yeah, I can help you with that, Gavin. Good question. So the impact in the quarter was about $4.1 million negative. And it's all relative to the timing of the performance of work. On this particular contract, which is an unconsolidated joint venture, we actually received an additive change order, which will result in Parsons earning $2 million more profit in the future. However, due to the fact the margin on that change order was lower, there essentially was a takedown of profit of $4.1 million in the quarter. We will get part of that back this year. We'll get the rest of that back next year. So in total, over the two-year period, we'll actually generate $2 million more in gross profit and adjusted EBITDA than we originally anticipated. So to break it down by year, the impact on this year, even though it was $4.1 million in the first quarter, will actually be for the full year about $1.5 million negative, and we'll actually have an impact, a positive impact next year of $3.5 million. So even though it sounds negative inside the current quarter, this is actually a positive development. It relates to the fact that the nature of the work on the change order is largely subcontractor work, as opposed to the earlier part of this project being on a direct performance, self-performed basis. So even though it looks negative, the message I leave you with, it's actually very positive to the business.
spk03: Okay, that's a great deal. I appreciate all that. Then maybe if I were to walk margins forward, if I adjust for that, your margins are up, it looks like 40 basis points year over year, If I adjust your charges out of last year, the margin for the rest of the year was nearly 10%. So if I were to walk forward for the rest of this year, are there any headwinds to margins year over year, or should we expect margins to continue on an adjusted basis to trend higher year over year?
spk10: Yeah, there's really no notable what I would call headwinds in the business per se. There is the one issue, and Kerry talked about this on the last call, where we have a notable project completion that wrapped up at the end of the first quarter, the salt waste processing facility project in federal solutions. That job tended to have a rich performance phase. So that's a bit of a headwind, but the fact that we expect to perform obviously much better from an execution standpoint on the critical infrastructure side I wouldn't say there's headwinds other than SWPI.
spk03: Got it. Okay. Thank you very much.
spk07: Our next question comes from Bert Subin with Stiefel.
spk11: Hey, good morning. Morning, Bert. Carrie, you mentioned oil prices helping your international customers in the Middle East. How much of a tailwind do you expect that to be for your business, and how quickly do you expect some of those projects to ramp up? Sounds like you're already doing one real project over there that's new. I'm just curious if you have any thoughts about how that could propel the business from here.
spk01: Yes, so the Middle East, we are seeing the infrastructure market start to pick up due to the oil price increases. If you look back two years ago, oil was at $20 a barrel. Last year it was $65 a barrel. The beginning of this year it was $78, and now it's $105. And these trends are really allowing the GCC to move forward more quickly with major infrastructure projects, particularly like what we're seeing in the Kingdom of Saudi Arabia Vision 2030 program and the UAE Railway program. We had a couple of wins I cited in the script that totaled the $75 million. These are basically new industrial cities that are being built in the Kingdom of Saudi Arabia. One is the Neom Oxygen. We were awarded a contract previously for $90 million. We received an additional add-on to that contract for $44 million. And we're providing project management consultancy services to build the new city. The second one is the King Abdullah Financial District, where our original contract value was $66 million. We received an add-on of $31 million and some additional scope. And that's basically a new iconic business and lifestyle destination that spans an area of about 11 square kilometers. It's also one that's targeted for ESG initiatives to achieve LEED Platinum certification. So we're quite excited about the opportunities that we're seeing in the Middle East.
spk11: Got it. Thank you. And maybe on the other side of the business, I think you used to break out your missile defense and C5ISR segment as being somewhere in the ballpark of 16% of your total revenue. So pretty substantial portion of the federal solutions business. Can you say, I mean, can you just give us like a frame around how much of that segment used to be or currently is related to missile defense? And are you starting to see increased activity there? Or do you expect that to start to ramp more in 2023? Thanks for the time.
spk01: Sure. For the full year 2021, it was about $582 million of our business. We are seeing a continued ramp there. We were awarded our team's repeat contract for $2.24 billion last year. That's a seven-year contract. That contract does have a 40% surge clause, which we've not currently planned on, but is there for use. And I'd say most of our area of focus right now is around hypersonic defense and the space-based sensor layer.
spk11: Thank you, Carrie.
spk01: Thank you, Bert.
spk07: As a reminder, if you'd like to ask a question at this time, that is star, then one. Our next question comes from Kai Von Rumer with Cowan.
spk08: Yes, thanks so much. So, Carrie, you had a .9 book to bill at Federal Solutions, which is pretty good given most of your peers saw – you know, the combination of the CR and Omicron basically hurting their, their, their awards and fundings in the quarter. Can you give us some color? You know, what impact did that have on you? And now that we've turned the corner into the second quarter, you know, what are you seeing in terms of momentum?
spk01: Yeah, thank you. Thank you. So first I'd point out we're pleased that our trailing 12-month book to bill is 1.2, and we've actually had eight consecutive quarters over 1.0. And book to bill, as you know, is very lumpy. Within federal, we did have a 0.93 book to bill this quarter. We did see a slowdown in proposals the second half of last year, but the fortunate thing is we saw an uptick the first quarter of this year. So I would say the continuing resolution might have slowed proposals. We were in a pretty fortunate position, though, because we had won the single award contracts that I mentioned previously. So what we focused on this quarter was really getting those contracts ramped up and going, and that's what helped our revenue. But I expect that our book to bill will continue to improve throughout the year based on our proposal volume.
spk08: Got it. And then you obviously look like you're off to an extremely strong start in the second quarter at critical infrastructure. Can you give us some color there? I mean, you've talked about the Mideast picking up. Is there more to come there? And when would you expect to see benefits from the infrastructure bill flowing through to the orders?
spk01: Yes, so the infrastructure bill, I would put into a couple of parts. First, part of the infrastructure bill affects our federal solution segment, actually engineered systems. We saw an uptick in our FAA contract already as a result of the infrastructure bill. Out of the additional growth that we received, $20 million of that was new funding from the infrastructure funds, and we expect that contract to continue to grow, as I mentioned during the call. We're also going to see some additional work coming through the Army Corps. So on the federal side of the house, those dollars are already starting to flow. If you move to the critical infrastructure side of the house, I'll break it into three parts. You have the formula funds, which are getting increased. You have existing grants and you have new grants. The formula funds are already coming out, the new funding, as well as the existing grants. What will be slower will be the new grant programs. So from a planning purpose, we have always put that into 2023, but we may see some start to trickle out in 2022. I did talk about the Middle East and the growth there, and we expect that to continue as they accelerate programs and move us to the left. I'll also mention Canada. In Canada, their investing plan started in 2016, and it provided $188 billion Canadian dollars in funding over a 12-year period. And out of that funding, $96 billion was new. And there is investment work for public transit, clean air and water, trade transportation in rural and northern communities. So we're already seeing those funds start to trickle out in phase one, which is focused on short-term stimulus and smaller projects, and then phase two will follow. So from a global perspective, I feel that we're very well positioned in critical infrastructure.
spk07: Thank you very much.
spk01: Thank you, Kai.
spk07: Our next question comes from Louis de Palma with William Blair.
spk05: George and Steve, good morning. For the U.S. infrastructure bill, do you still expect transportation solutions to have the biggest impact for Parsons? And I guess following up on the last question, what do you think the timeline will be in terms of when the infrastructure bill will create like a significant inflection to your critical infrastructure revenue?
spk01: Thanks, Louie. Yes, transportation for us is the largest portion of our infrastructure portfolio, specifically roads and highways and rail transit. So we do expect that to have the biggest impact, although we will see some growth in areas such as environmental remediation and water, wastewater treatment, as well as broadband and some utilities as well. But I would say transportation is by far our largest portion. The impact, as I mentioned earlier, we're planning on 2023. We may see a little bit trickle out earlier in terms of some of the rail transit federal projects.
spk05: Great. And for your cyber solutions, there appears to be elevated DOD demand for solutions related to mitigating satellite jamming with alternative position navigation and timing. Last year, I believe you acquired an asset called Echo Ridge, and you also seem to have existing solutions in this area. And I was wondering, does Parsons see or have any significant opportunities in its pipeline for satellite jamming mitigation and alternative position navigation and timing? Thanks.
spk01: Yes. Thank you, Louie. So we provide resiliency today for space assets, satellites, links, and ground systems. I would say the majority of our work is on the ground system component. And to your point, we did, by both Braxton Technologies as well as Echo Bridge, help us in the assured position navigation and timing space. We felt that we have some unique offerings, and, yes, we are seeing opportunities there.
spk05: Sounds good. Thanks, Carrie, and thanks, George. Thanks, Zoe.
spk07: As a reminder, if you'd like to ask a question at this time, that is star, then 1. Our next question comes from Toby Sommer with Truist Securities.
spk02: Thank you. Good morning. First question on critical infrastructure. How do we compare and contrast the effect of the infrastructure bill that occurred, I guess, 13 years ago at this point versus the current one. I think the dollar values are higher here, but so is the duration of time that the customer will spend it. And I know you have also got sort of a different internal focus on what you'll bid for now versus some of the work that you did a decade plus ago that you might not pursue at this point. How do we kind of compare and contrast that?
spk01: Yeah, thanks, Toby. Great question. So the one that you referred to is the Safety Act, which was passed in 2005. That was for $244 billion, and it basically ran over a period of four years, a little bit beyond that. The current one is for $1.2 trillion, and now that $550 billion is new funding, so much larger funding this time than the prior time. We had previously mentioned that persons grew during the prior bill by about 10% on the top line. And that was with about twice the number of competitors as what we see today from the fact that the industry has consolidated since then. We have changed our work scope, as you mentioned, but I would say back when you look back in 2005, we actually were not doing construction. We were predominantly focused on design engineering. as well as owner's engineering work, the exact same as we are today. Where we got involved in construction was starting in a period of about 2010 to 2015, but it was after we saw the funds from the Safety Act. So from our perspective, we see the infrastructure bill as being a significant inflection point for the businesses. It's going to be much larger than the Safety Act, and we feel we're in a very good position for design engineering and owner's engineering work.
spk02: Okay. Would you have any initial thoughts on what the slightly longer-term impact of the Russia-Ukraine war is on the smoothness or lack thereof of Congress sort of passing budgets and what next year might look like? Because certainly there's a lot of inflation, so if you don't have a a decent sort of mid-single-digit rate of budget growth. You might not have any growth in terms of spending in real terms.
spk01: Yeah, we do think that the war, as unfortunate as it is, and I do give our sympathy to all the people in Ukraine, but we do think it is going to help the budgets go up. Obviously, the FY 2022 budget was about $782 billion. FY23 budget, we were pleased, you know, that went up to $813 billion for national security. I would say for persons from a longer-term perspective, we see the opportunity to assist with what's going on in the Ukraine, specifically around areas like chem bioprotection type of activities, security systems, specifically electronic security systems, access control, physical surveillance. We're involved in also cyber electronic warfare, information operations, and then wherever we can assist the NATO countries and particularly the Ukraine as they go about rebuilding after the war.
spk02: Thank you.
spk01: Thank you.
spk07: Our next question comes from Ron Epstein with Bank of America.
spk09: Yeah, hey, I'm wondering if we could just peel back the onion a little bit on what you're seeing in terms of, you know, it looks like the fiscal 23 budget is going to come in much better than I think a lot of people were anticipating, and there's going to be probably even further upside to that. So as you look down the road, what do you see there as potential opportunities for Parsons?
spk01: Thank you, Ron. I would say that, yeah, the FY23 came in much better than everybody expected at a 4 percent increase. I think the most important thing for us is the increase in the research and development, which is really where we play, because we play on kind of the formation of programs where we drive technology innovation. And that R&D budget was the Pentagon's largest ever request in that category. So, if you look at areas like hypersonics, artificial intelligence, Cyber security, those are all very much aligned with the person's portfolio.
spk09: Got it. And when do you think you could start to see that kind of flow through your business?
spk01: I would say once the fiscal year starts, it'll be flowing through. There's definite impetus, particularly given the Russia-Ukraine situation, to make sure that we stay in front of this. And I would also say even more so than Russia, Ukraine, China still remains the biggest national security threat and making sure that the United States is well postured against China, particularly in those critical R&D areas.
spk09: Got it. Thank you.
spk01: Thank you.
spk06: That's all the time we have for questions today. I'd like to turn the call back to Dave Spilly for closing remarks.
spk04: Thank you for joining us this morning. If you have any questions, please don't hesitate to give me a call. And we look forward to speaking with many of you over the coming weeks. And with that, we'll end today's call. Have a great day.
spk07: This concludes today's conference call. Thank you for participating. You may now disconnect.
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