Superior Plus Corp.

Good day, and thank you for standing by. Welcome to the Superior Plus 2022 Third Quarter Results Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during this session, you'll need to press star 1-1 on your telephone. Please be advised that today's conference is being recorded. I would now like to turn the conference over to your speaker today, Rob Doran, Vice President of Capital Markets. Please go ahead.

Thank you, Catherine. Good morning, everyone, and welcome to Superior Plus' conference call and webcast to review our 2022 third quarter results. On the call today from Superior Plus are Luc Desjardins, President and CEO, and Beth Summers, Executive VP and CFO. For this morning's call, Luc and Beth will begin with their prepared remarks, and then we will open up the call for questions. Listeners are reminded that some of the comments made today may be forward-looking in nature and are based on Superior's current expectations, estimates, judgments, projections and risks. Further, some of the information provided refers to non-GAAP measures. Please refer to Superior's continuous disclosure documents available on CDAR and Superior's website yesterday for further details. Dollar amounts discussed on today's call are expressed in Canadian dollars unless otherwise noted. I'll now turn the call over to Luke.

Thank you Rob and good morning everyone. for joining the call to discuss our third quarter results. I'm pleased to say quarter three results are in line with management expectations and we're maintaining our 2022 adjusted EBITDA guidance range. It's important to know that quarter three is the seasonally slowest quarter for our business due to the lower heating load of this quarter. In particular, was negatively impacted by the timing of acquisition complete in the past nine months. We've acquired two pretty good-sized enterprises, and we incur all the costs associated with the acquired businesses, but the volumes are lower due to the lack of demand in the summertime, and we have not yet had the timing to achieve all the associated synergies, which are coming in the next 18 months. Our Canadian business was also negatively impacted by warmer weather, especially in Western Canada, as well as the lack of Canadian emergency wage subsidies. of third quarter 2022. So basically, I think there is an opportunity for everyone to understand that quarter three is so low in volume, and we made those two acquisitions not a year ago, but not having the chance to have all the EBITDA that comes in quarter four and quarter one, which are going to be coming in the next two quarters. So there is a disconnect there, no surprise to us, With our partners' business at the right price, the Synergy are tracking a bit ahead of time because we start to work on it this summer, and there is absolutely no surprise for us of this situation in quarter three. As with our two-year date result in quarter four 2022, we're comfortable in our ability to manage the impact of inflationary pressure on our business to increase price and cost-saving initiatives. We saw the benefit of acquisition completed over the last year to higher volume quarter over quarter. However, as I mentioned, we also saw higher operating expense in the quarter. Our focus on being a perfectly energy distributor means that our third quarter results would emphasize the seasonality of the industry we operate in, especially in the U.S. propane distribution segment, which has mainly residential customer whose consumption is dictated by eating degree day, which are very low in July to September. We're making great progress in the Superior Way Forward EBITDA growth initiative through acquisition, continuous improvement, and organic growth. During the quarter, we'll make great progress on the integration of a qualt and camp acquisition ahead of the eating season, which will set up very well for synergy realization going forward. We also closed three small acquisitions since our last update in quarter two, one in California, one in North Carolina, and one in Ontario, Canada. For a total consideration of $29.9 million, with these three acquisitions, we have achieved a low end of our 22 acquisition target, range of $200 to $300 million in enterprise value, excluding CAATS acquisitions. We continue to demonstrate our commitment to our dynamic capital allocation approach through our commencement of a normal post-issue bid in October 13, providing us with another level lever through which to return capital to shareholders. This does not mean we're no longer evaluating M&A targets. We will do acquisition, but we may also repurchase shares if that opportunity generates the appropriate return. We're focused on creating long-term shareholder value and we will only allocate capital to our most accretive opportunities. I'll now turn the call over to Beth to discuss the financial results in more detail.

Thank you, Luke, and good morning, everyone. As Luke mentioned, Q3 is the seasonally slowest quarter for our business, and our results were in line with our expectations. superior generated third quarter adjusted EBITDA of negative 8.8 million, a 21.8 million decrease over the prior year quarter. This was primarily due to lower adjusted EBITDA at our Canadian propane distribution and US propane distribution segments, higher corporate costs and a realized loss on foreign currency hedging contracts compared to a gain in the prior year quarter. The decrease was partially offset by higher adjusted EBITDA from our wholesale propane distribution segment. The third quarter loss from continuing operations was $206.9 million, an increase of $171 million compared to the prior year quarter. The primary driver for the higher net loss was an unrealized loss on derivatives and foreign currency translation of borrowings compared to an unrealized gain in the prior year quarter, higher selling distribution and administrative costs, income tax expense, and finance expense, partially offset by higher gross profit. The loss on derivatives and foreign currency translation of borrowings compared to a gain in the prior year quarter was primarily due to the changes in the market price of commodities, the timing of maturities of underlying financial instruments, and the changes in foreign exchange rates relative to the amount hedged. Turning now to the individual business results. Our U.S. propane division adjusted EBITDA was negative 10.9 million, a decrease of 3.1 million from the prior year quarter primarily due to higher operating expenses partially offset by higher sales volumes from acquisitions completed in the last 12 months and higher average margins. Canadian propane adjusted EBITDA was 3.6 million, a decrease of 14.4 million from the prior year quarter primarily due to higher operating costs and modestly lower sales volumes than average margins. Operating costs were higher primarily due to the $8.2 million Canadian Emergency Wage Subsidy or CEWS realized in the prior year quarter compared to nil received in the current quarter. Sales volumes decreased by 3% primarily due to lower commercial demand related to warmer weather in Western Canada. And the average weather in Western Canada for the three months ended September 30, 2022, as measured by degree days, was 27% warmer than the prior year quarter. Average margins were lower primarily due to the impact from the sale of carbon offset credits amounting to $4.7 million in the prior year quarter. Wholesale propane adjusted EBITDA was $5.1 million, which was an increase of $1.9 million from the prior year quarter, primarily due to the contribution from the acquisition of Kiva Energy Inc. Turning to corporate results, the adjusted EBITDA guidance as well as leverage. The corporate operating costs were $6.2 million, an increase of $5.2 million compared to the prior year quarter, primarily due to higher insurance costs, higher professional fees and a lower long-term incentive plan recovery related to less of a share price decline in the current quarter compared to 2021 and the impact of inflation. Superior realized losses on foreign currency hedging contracts of $0.4 million compared to a gain of $0.6 million in the prior year quarter due to the average hedge rate of foreign exchange hedging contracts compared to the weakening of the Canadian dollar. Superior's total net debt to adjusted EBITDA leverage ratio for the trailing 12 months ended September 30th, 2022 with 4.3 times, which is above our target range of three and a half to four times. The higher leverage ratio was primarily due to the impact of the higher US CAD rate on the US denominated debt. On a constant currency basis, using the rate as of June 30th, 2022, Superior's leverage ratio at September 30, 2022, would be 4.1 times. As Luke mentioned, we're maintaining our 2022 adjusted EBITDA guidance range at $425 million to $465 million, with a midpoint of $445 million. For the fourth quarter, we anticipate average weather to be consistent with the five-year average for the U.S. and Canada, and the wholesale propane fundamentals to be consistent with the past six months. With that, I'd like to turn the call over to Q&A.

Thank you. And as a reminder, to ask a question, you'll need to press star 11 on your telephone.

Please stand by while we compile the Q&A roster.

Our first question comes from Gary Ho with the Jardians. Your line is open.

Thanks, and good morning. Maybe just to start off with a question on your guidance. So you've confirmed the range. That's great to see. There's only a month and a half to go here. So if you hit the five-year average weather pattern, we should think about meeting the middle of that range and then vice versa for better or below. Is that how we should think about that when we track the heating degree days for the balance of Q4?

Yeah, so as you know, historically, if we were not to be in the middle of the range, we usually tell everyone we adjust. We didn't adjust because we feel confident today that the year, normal weather going forward, the year will be what it is and will be in the guidance. October was better than anticipated in the States, and of course, very warm in Canada, but we've been around For me, 12 years here, and there's many weeks to go, and the colder weather has already started out west. Any of you on the call that are west have been getting it. So, no, we're confident that as of today, we feel we're in the range.

Okay, great. And then, Luke, while I have you, I want to get an update on the CEO transition plan, maybe discussions with the board and what they're looking for for your success in there, Luke.

Yes, that's a work in progress. They've hired an outside firm and they're looking internally and externally as to candidates and hasn't advanced that much over the last two, three months because usually it's a process that usually takes six to nine months, I would say. So there's a committee of the board, three of the board members that are on that and there's a regular feedback to the board on the quarterly as to how that's Advancing, no news at this stage. It's somewhat early. So progressing normally, I think, for me, because usually a project like that is at least six to nine months.

Okay. And then my last question, you have announced your NCIB and executed a bit of it recently. Maybe for Beth, as we stand here today, how would you kind of rank the capital allocation priorities, buybacks, M&A, and the leverage. And then just on the latter part, the leveraging, you know, if rate stays at roughly $1.35 here, when will you get back to that 3.5 to kind of 4 times target range?

Okay, so a couple of questions in there. So from a buyback perspective, yeah, we have the NCID in place. As far as allocation of capital, as we consistently will communicate, it is a dynamic model. So we would look at, you know, what returns make sense or what our view on the returns are and how we allocate. So when you asked me sort of to look at it and to judge whether it's M&A or buybacks, I mean, that's going to be on an individual basis. I think from the perspective for M&A as you look out, and Luke may want to add on to this, M&A as we look for the remainder of this year in particular, typically once you hit this time of year, you don't have a lot of people at this point looking to sell. That will typically pick back up from a normal shape perspective back after you're through the heating season, so that April, May into next year. To your question on leverage and our target of the three and a half to four times, I mean at this point we would view ourselves at the end of this year being near the high end of our three and a half to four times. You know, synergies need to be, or will continue to realize those, which will have a positive impact from a leverage perspective. And as we've always said that three and a half to four times range, while we're moving forward in doing our acquisitions, We have that range just because it's going to depend on the timing. We've had sort of very chunky where we've accelerated and been ahead of our targets and what we're looking in that total. You may recall back from the investor day, the $1.9 billion in total. You know, we've been well ahead of the $250 million per year target. So, I mean, as we look to get to that $700 million to $750 million by the end of 2026, on EBITDA from operations, you know, it's going to be chunky. So, to answer your question, it's really going to be dependent on the opportunities and how they present ourselves for when we'd be down towards that bottom end of the range.

Okay, great. Okay, that's it for me. Thanks for the call. Thank you.

Our next question comes from Daryl Young with TD Securities. Your line is open.

Hey, good morning, everyone. Just one quick one for me. I just wanted to kind of reconcile your thinking around capital deployment, given where leverage is, and it seems like costs continue to march higher. I'm just wondering if it would make sense to hit pause on the M&A and the NCIB for a period of time and really focus on realizing those synergies and managing the cost profile. And I'm also speaking with respect to the pro forma EBITDA numbers with the queues rolling off and the decline in that pro forma EBITDA number. It just seems like cost management could be a focus going forward.

Maybe I'll start and then turn to that. So from an overall cost, quarter by quarter, how difficult to be on the percentage always of the right amount but overall costs are not going up more than inflation and we are capturing all of that into margins. So we are not at risk of not making our profitability due to cost increase from all the aspects. From an acquisition point about the capital, good timing, we just did two good size deals We're integrating them. I can promise you all the 25% improvement is on track. And then a bit less deal, like the small one, happening at this stage. Let's go do those two integrations. Let's go through the fall, winter season, which usually there's not much deal going on. And we'll probably look at deals more of the second half of 2023 comes in the summer. So at this stage, probably a good timing that we're not having another big crazy deal in front of us. And because two weeks of infancy, we're confident. And we're ahead of the game, actually. So the balance act of having done two good deals, slowing down a bit because we're going to our winter, we're doing those two integrations, will certainly help our leverage, I think, when we go to later 2023.

And maybe I'll just walk through a little bit. From a leverage perspective, we're at the end of the quarter, we are at 4.3 times. Just to walk through some of the factors. So of the 4.3 times, there was a lot of volatility with the FX rate right at the end of the quarter. So that's where if you balance it out, there was roughly a $97 million impact on our foreign denominated debt, which had that 0.2 times. impact, which would bring us down to the 4.1 times. And when you really look at the EBITDA in Q3, you do have some individual impacts that were impacting the year-over-year reduction of the $22 million. So just to walk through some of those, from an M&A perspective, where the U.S. acquisitions are primarily heating load, they in Q3 will have a negative impact. And so there was roughly almost $7 million of negative impact which is Q4-Q1 where you'll more than make up for that and you're going to see the growth in that EBITDA as well as achieving all of those synergies. And obviously the wage does be impacted and timing of carbon credits. There was 4.3 million of carbon credits in the Canadian business that we would have realized in Q3 last year and this year it'll be more than likely moved into different quarters so we'll see that in Q4. So again, looking at all of that from a leverage perspective, we do have that as one of our financial metrics, but we also balance that with the payout ratio. So from a payout ratio perspective, we do target that 40% to 60% range. If you look at Q3 with the impact, we're modestly above the 60%, but certainly when we design that target, we have it so there is a cushion. And again, that's just overall to ensure that we have plenty of free cash flow to pay out dividends. And so from a dividend perspective to always ensure that we have a cushion in place.

Okay. And maybe just one follow-up to something that Luke said about pricing and pricing the gross margin to account for the costs. Where do you stand today on a competitive basis in terms of your price? And is there a risk if price keeps going higher that you maybe create a customer churn?

No, it's a very good question. We are doing analysis regularly by region as to where pricing of a market is. And we know that 80-90% is always a small one that is lagging on increasing the price according to new inflation cuts, but the gross majority of our industry is increasing the price accordingly. Most people don't want to make less profit year to year, and we see our pricing is analyzed by region, by market. Where are we? What can we get to increase price with inflation and not lose business? So there isn't a business loss. We're actually growing market share in Canada, residential and commercial. Very pleased with our marketing sales approach. Not so much in the state, but still maintaining the same market, same market position, market share. And so we're analyzing that properly and are careful to do it the right way. What we think we'll see in 2023, that's been much of that so far. It's probably a conservation a bit more, you know, maybe 1% more in the wintertime because people have less money with not having the big bills. A bit of help these days for how we go through the winter is the propane price coming down compared to last year. So this is going to be a big help. So our customers really are going to be getting a reduction in price. and that really shows well for the winter coming.

Okay, that's great. Thanks. I'll get back in the queue.

Thank you. And our next question comes from Matthew Weeks with IA Capital Markets.

Your line is open.

Good morning. Thanks for taking my question. I was just wondering, you know, on the increase in kind of the U.S. dollar denominated debt, I was wondering if there's any offset, if there's an asset or if there's any swaps or hedges or anything like that, or if that's something you think about doing, you know, going forward.

I think we do have FX hedges, which you see disclosed. Those hedges are designed for the cash flows of the business as well as EBITDA of the UX business. Offsetting the debt, no. It's done at a current rate and we have the business generating. So the view is we have a natural hedge, arguably, as we go forward for the long-term debt. And again, it's because it gets marked at the current rate. Now, on an average basis, our U.S. EBITDA numbers and U.S. earnings, I mean, they over time will be at the average rate. It's just you have a large disconnect right now between the two, between the EBITDA and the impact on the debt. What I will actually flag, which we don't factor into our leverage calculation, we do have a vendor note which actually matures prior to the long-term debt, and that's $135 million if you include the accrued interest. So that would actually have a positive impact on leverage if we reflected that in abruptly 0.3 times. But again, that matures before the long-term debt, but because it's not factored into typical covenant calculations, we don't reflect that in how we disclose our leverage.

Okay, thank you. And my next question is just, you know, kind of on synergies. And you disclosed kind of the amount of, you know, synergies you expect to get from acquisitions here. And we'll probably see that more as we go through the winter, you know, heating season. But how does that compare to sort of your initial estimate? Sorry, are synergy capture pretty in line with what you, you know, initially thought when you were acquiring these businesses?

Yes, so on camps it's perfectly as planned and on quals we have a bit more than the usual 25% we always commit to, so it's looking good. When we do the smaller deals, not that they account for a lot, but the return and the scenarios are even higher, they're more than 30% range. So everything is, as all the deals we've made, everything is marching on accordingly. When we do our due diligence, we can easily take our approach and our dashboard of how these energy opportunities are. And having done it now 20 plus times, there's not a lot of room for achieving our main plan because of our history, our experience, and our integration approach.

Okay, thank you. That's it for me. I'll turn it back.

One moment. Our next question comes from Joel Jackson with BMO. Your line is open.

Good morning, everyone. Good morning. First question, I know you're not talking about 2023 quite yet, but can you maybe – based on some of the acquisitions you've done this year or you haven't achieved a full run rate of earnings or the synergies or some lagging synergies for deals you've completed the last few years, how much more would you think EBITDA earnings go up in 23 versus 22 just based on normalizing a full run rate of some acquisitions this year plus some lagging synergies you haven't achieved yet, if you get my question right?

Yeah, this is not the time where we announce our guidance, but You're right that it's looking good as of now because we do have those two deals and we have those synergies that we've achieved during the summer when usually when we acquire we don't have immediately the summer ahead of us. It's not the ideal time to acquire business even though it will pay forever. So yeah, we cannot give you the guidance but it's positive and it's going to be a good improvement over this

Yeah, and Joel, maybe another way to think about it is if you look at the, you know, in our calculation for the leverage ratio going back to the TTM, like you have pro forma adjusted EBITDA on a TTM basis of the $468 million. That wouldn't, you know, from there, that does include sort of accounts and quarrels. Basically, that's because most of the EBITDA comes in Q1 and Q4. From there, you have incremental synergies, which we'll be achieving going forward.

Right, Beth. That's what I was getting at. My second question is, can we look at margins here? If I look at the Canadian propane, US propane, wholesale propane, gross profit per liter, what might Q4 look like versus Q3? And then what kind of averages should we be thinking about for 23 and going on? Sure.

Okay. So, Joel, maybe I'll talk about the U.S. first. So there was, I mean, obviously, an increase quarter over quarter of roughly $0.07, getting us to the $0.449 for the quarter. For the balance of year, I think the best way to think about it is, again, looking at the range of the $0.30 to $0.35 U.S. or $0.39 to $0.46 CAD. And I think we'd anticipate for Q4 for it to be towards the high end of that range. And what that would mean from an overall average basis for the year, thinking about it as like slightly better than 2021. And in 2021, it was 32 and a half cents US. So from a Canadian propane perspective, very consistent quarter over quarter for the balance of the year. Think of it in that range of $0.28 to $0.30, and that's probably a good range for the total year as well, or an average for the year, that $0.28 to $0.30. And then wholesale, I think the best way to think about the wholesale business is basically the range of $0.03, which would sort of consistent quarter over quarter and also a relatively good number for an average for the year.

But you've been hitting a lot better than $0.03 in wholesale.

Yeah, it's going to depend. Yeah, it's going to depend. And you've got some FX in there as well. But 3 cents is a good for an average.

Okay, thank you. Thank you. And our next question will come from Steven Hansen with Raymond James.

Your line is open.

Yes, good morning. Thanks for the time. Apologies if I missed it, but I was hoping you could perhaps speak to how you're thinking about the somewhat volatile propane macro backdrop we've been seeing of late and what it might mean for your business this winter. Weather is always the key driver, of course, but I'm just thinking about some of the conditions around energy shortages in Europe, the big export pull we've been seeing from North America on propane, a weaker grain drying season, factors like that, and just how you're navigating all those and whether you see this opportunity or risks or fairly neutral? Thanks.

Sure. So at this point, you know, in our view, the fundamentals are actually pretty neutral. So the inventory levels have improved. They're within three-year averages or in that range for both Canada and the U.S. And the U.S. has been well under three-year average for a period of time. Also, from a price perspective, like the prices have come down, so they are weaker. And that is linked as you're sliding there to the crop drying. Now, I think the next indicator where you could get some volatility is if you have extreme cold weather impacting. Now, and I think, you know, if there is that cold, obviously the prices will typically strengthen. But if it's weather normal, then I think it'll likely stay within the range, or that would be our view. Now, from a macro impact, I mean, there's certainly pricing around WTI crude, the conflict in Ukraine, as well as potential COVID resurgence, certainly at a macro level. That could have some impact in the next four to five months. Now, from our perspective, I mean, we will purchase fixed price supply where we have fixed price contracts. So from that perspective, we're comfortable that we've got predictable margins. And then just to flag, and I know everyone's aware, but just to flag, we do have the ability to pass through the increasing commodity costs. But again, the prices are down. They're down roughly 30% now from where they were in Q1, Q2, the highs.

So I'll give you just a bit more color. When you produce more natural gas and you're exploring You also produce propane as a percentage of your total production. And propane doesn't export as much as natural gas. So you end up in America at this stage having good inventories that are going up. Prices have come down to that point, which is always a good thing for us. So we can maintain our margin. Prices are coming down. We're going to do some fixed price with customers and help them also having to their previous question of attrition and customer taking less volume, it's going to be a good year because we're going to end up giving them a discount. Even though we keep the same margin, it might be a bit better than the average, but they're getting a discount for the next six months for the winter to come from the previous price they paid this past year. It's all good.

That's great. That's a really good perspective, guys. I appreciate that. I don't mean to beat the dead horse on the capital allocation issue, but just wanted to circle back one more time on the idea around deleveraging versus M&A and even the buyback. I mean, how do you feel about the opportunity set of just those three buckets? I'm struggling a little bit because the multiple has gotten a lot cheaper, of course, of late for the equity. I know your pipeline's got good opportunities in it as well, but then you've got this debt pay down issue. It strikes me as you know, multiple priorities for the same set of capital. And I'm just trying to get a better sense for where you think the real priority is, or if it's just, if it is perfectly balanced. Thanks.

Yeah, I mean, I think I can sort of tick it off. I mean, I think from an M&A perspective, as I mentioned before, we always see much less in Q4 and Q1 from an opportunity perspective. You know, again, from a Share repurchase perspective, you know, very small amount as we were looking at that. And that's when the returns make sense and we think that our shares are undervalued and it does present a better return to us. So, I mean, I think it's fair to say we're always... balancing all of our various metrics and looking to deliver balance with payout ratio and the other pieces and then, you know, return. We didn't communicate while we were going through accelerated M&A that we were targeting the three and a half to four times, so that hasn't changed, and we will deliver basically as the cash flows come in.

Okay, that's great. Appreciate the call, Beth. Thanks.

Thank you. And our next question comes from Robert Cotelier with CIBC. Your line is open.

Yeah, I just have a question on the M&A market. Have you seen the market valuations change at all in light of the cost pressures in the higher interest rate environment?

I mentioned that in the last quarter. It's a good question. I believe price of acquisition are going to come down. The last two little deals we did, you can see it, and not being in the market for a bigger deal now because of everything we've talked about for 2023, the people I know in the industry that I've talked with them many years, they understand that valuation is not the same. Good-sized companies that are in different industries Canada and the U.S. knows that. And, of course, we're always going to buy when we have a return that are expected. Otherwise, we don't. But the trend is now for a lower price overall for paying independent companies. It is.

Okay. And then are you managing risk? in the M&A process any differently in light of those, you know, the inflationary environment and the higher financing costs?

Yeah, I mean, I think from our perspective, I mean, as you look at the increase, increasing interest rates is better. It obviously has an impact on our weighted average cost of capital. So in looking in... judging appropriate return levels, that does get factored in, and it'll have an impact on the hurdles as we look at the businesses. So this gets back to, as the underlying macroeconomic factors change, the expectation would be, you know, as things settle out, you're going to have lower multiples, just to ensure that we get the appropriate level of returns, to ensure that we're delivering what we need to from a shareholder perspective and a business return perspective.

And there are two things that I thought Our equity firm inside, they have a bigger situation than us. They go to the market day-to-day every deal. So now if interest rates are higher, we're interest rates well organized for the years to come. So they're going to expect to pay less to get their return as well.

Sure, I was also wondering just about maybe how you structure the deals in light of the volatility that's out there, presumably some form of recession, and whether you structure the deals to include more earn-out rather than just firm valuation.

No, I think you end up paying less. Entrepreneurs don't like earn-out. They rather get the cash and then move on. So I think it's valuation, not bucks or no.

Well, and just to sort of clarify, your concern in that you're flagging, that would get reflected in how we model. So that would be reflected in how we model the business and what we would anticipate or expect to see over the next four or five years. So we would factor in, you know, recessionary pressures and the potential impact that would have. But what I will flag, I mean, recall our business typically as well as the acquisitions we've been making are pretty recession-proof if you look at historic and the values because, you know, they are typically related to heating load and people need to heat their houses whether we have a recession or not.

Yeah. Okay. Thanks, everyone.

Thank you. Thank you.

Thank you and I'm showing no other questions in the queue. I'd like to turn the call back to Luke Desjardins for any closing remarks.

So I'll wrap up this call. I'd like to thank our management and employees. Very proud of all of our accomplishments today, 2022. No surprise to us, we're on the game plan. We're in a solid position to deliver the 2022 adjusted VISA guidance and to a few questions that was raised, we expect a good year in 2023. Thank you all for your participation, and we'll see you next quarter.

Thank you. This concludes today's conference call. Thank you for participating. You may now disconnect. The conference will begin shortly. To raise your hand during Q&A, you can dial star 11.