This conference call transcript was computer generated and almost certianly contains errors. This transcript is provided for information purposes only.EarningsCall, LLC makes no representation about the accuracy of the aforementioned transcript, and you are cautioned not to place undue reliance on the information provided by the transcript.
spk02: Thank you for standing by. This is the conference operator. Welcome to the Total Energy's first quarter results conference call. As a reminder, all participants are in listen-only mode and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. To join the question queue, you may press star then one on your telephone keypad. Should you need assistance during the conference call, you may call an operator by pressing star and zero. I would now like to turn the conference over to Mr. Daniel Hollis, President and CEO. Please go ahead. Thank you, Operator. Good morning and welcome to Total Energy Services' first quarter 2020 conference call. Present with me this morning is Julia Gorbach, Total's VC, Finance and CFO. We will review with you Total's financial and operating highlights for the three months ended March 31st, 2020, and then provide an outlook for our business and open up the phone lines for questions. Yuliya, please proceed.
spk00: Thank you, Dan. During the course of this conference call, information may be provided containing forward-looking information concerning total projected operating results, anticipated capital expenditure trends, and projected drilling activity in the oil and gas industry. Actual events or results may differ materially from those reflected in total forward-looking statements due to a number of risks uncertainties, and other factors affecting total businesses and the oil and gas service industry in general. These risks, uncertainties, and other factors are described under headings Risk Factors and Elsewhere in Totals Most Recently Filed, Annual Information Form, and Other Documents Filed with Canadian Provincial Security Authorities and are available to the public at www.cedar.com. Our discussions during this conference call are qualified with reference to the notes to the financial highlights contained in the news release issued yesterday. Unless otherwise indicated, all financial information in this conference call is presented in Canadian dollars. Total Energy's financial results for the three months ended March 31, 2020, reflect a relatively strong track to the year as compared to 2019 that was short-lived when oil prices collapsed as a result of the COVID-19 pandemic and the Saudi-Russian battle for share in the global oil market. The impact of the decline in oil prices was felt in all of Total Energy's business segments. North American drilling and completion activity began to decline materially in March, and revenue in the compression and process services segments decreased materially on a year-over-year basis with a low production activity. Drilling and service rig activity remained stable in Australia during the first quarter, although increased wet weather conditions resulted in a greater rig standby time. Revenues for the quarter were $134.3 million, which was 40% lower than prior year comparable quarters. By business segment, Contract drilling services contributed 32% of 2020 first quarter consolidated revenues. Compression and process services, 30%. Well servicing, 25%. And rentals and transportation services, 13%. This compares to 55% in CPS segment, 21% in CDS segment, 17% in well servicing, and 8% in RDS segment. in the first quarter of 2019. Geographically, 52% of first quarter reported revenue was generated in Canada, 23% in the United States, and 25% in Australia. In the first quarter of 2019, 43% of revenues came from Canada, 34% from the United States, and 23% from Australia. Within our CDS segment, 57% of first quarter revenue came from Canada, 27% from Australia, and 16% from the United States. While operating days for the first quarter of 2020 were 7% higher than 2019, segments revenue for the quarter declined 6% on a year-over-year basis. This decrease alone arose from 12% decline in revenue per spot release, which was due primarily to the mix of equipment operating. Despite lower revenue, efficiency gains and cost management gave rise to $2.9 million improvement in quarterly segments operating income. The most significant year-over-year financial improvement within our CDF segment came from our U.S. drilling operations. Despite 37% year-over-year decline in operating days, and 16% decline in revenue for spark release days during the first quarter of 2020. The operating loss within our U.S. drilling business decreased by 45%, following efforts over the past several quarters to consolidate operations and improve efficiency. Underlying year-over-year decrease in the first quarter revenue for our U.S. drilling operations was a substantial reduction in operating days for our CEE triple rigs, as the market for bigger rigs began to soften. While first quarter utilization in our Australian driven operation on 1% percentage point lower and revenue per day was $1,970 lower than 2019, operating income was 45% higher in Q1 2020 as compared to Q1 2019. This was due to reduction in lower margin camp and other ancillary revenue, as well as strong cost management while rigs were on a paid standby due to prolonged wet weather conditions. Continuous competitive industry conditions in Canada was a primary driver for a 9% year-over-year decline in first quarter segment revenue within our rentals and transportation services segment. somewhat offsetting a 17% year-over-year decline in revenue in Canada was a 6% increase in the first quarter revenue from our U.S. RDS operation. 41% of first quarter RDS segment revenue was generated in the U.S. as compared to 35% during Q1 of 2019. The RDS segment incurred an operating loss of $2.4 million for the first quarter of 2020 as compared to $1.6 million loss in Q1 2019. The primary reason for this $0.8 million increase in quarterly operating loss was a $1.6 million year-over-year increase in depreciation expense following the change in accounting estimates that was effective July 1, 2019. Within our compression and process services segment, First quarter revenue for 2020 was $40.7 million, a 66% decrease compared to first quarter 2019. Substantially lower year-over-year fabrication sales was the primary driver of reduced segment revenue. Despite cost management efforts, first quarter operating income decreased 76% from Q1 2019 to $2.8 million, as lower production activity results in lower fixed cost absorption. Compression horsepower and rent at March 31, 2020 increased by 11% compared to March 31, 2019. The CPS segment exited the first quarter of 2020 with a fabrication sales backlog of $44.5 million, a $4.1 million decrease. from December 31st, 2019. First quarter revenue for our wealth servicing segment was $33.7 million, a 9% decrease from Q1 2019. This was due primarily to modestly lower pricing in North America, lower camp and not anti-liver revenue in Australia, and the weakening of Australian dollar relative to the Canadian dollar over past year. Total service hours for the first quarter were 41,530, of which 47% were in Australia, 40% in Canada, and 13% in the United States. This compares to 42,649 service hours during the first quarter of 2019, of which 49% were in Canada, 42% in Australia, and 9% in the United States. Despite lower quarterly segments revenues compared to 2019, operating income for the well servicing segments increased 6% on a year-over-year basis, primarily as a result of improved performance in our Australian operations. Consolidated gross margin for the first quarter of 2020 was $33.6 million, or 25% of revenue, as compared to $42 million, or 19% of revenue, in the first quarter of 2019. Increase in gross margin was due primarily to proportional increase in contribution from higher margin segments to total consolidated revenue for Q1 2020 compared to Q1 2019. Consolidated cash flow before changes in non-cash working capital items was $31.9 million for the first quarter of 2020 as compared to $28.5 million of cash flow generated in the first quarter of 2019. During the quarter, our investment in inventory grew by $7.4 million as we continue to take delivery of long lead time major components previously on order within our CTA segment. Remaining purchase obligations at March 31st, 2020 were approximately $7.9 million, a $6.3 million reduction from December 31st, 2019. We estimate our investment in inventory at March 31st, 2020 is near peak levels and is going forward. We would expect such investments to decline as existing inventories are consumed. Consolidated EBITDA for the first quarter of 2020 was $30.9 million as compared to $29.4 million of EBITDA realized in Q1 2019. Excluding $7.9 million of unrealized foreign exchange gains and $0.4 million provisioned for doubtful accounts, first quarter 2020 EBITDA was $23.4 million. During the first quarter of 2020, Total Energy generated income attributable to shareholders of $4.7 million, or $0.10 per share, which was consistent with Q1 2019 net income and earnings per share. Total Energy's financial conditions remain strong, with $124 million of positive working capital after reclassifying $40.4 million of mortgage debt as current at March 31, 2020. On April 29, 2020, the company renewed this loan in the principal amount of $50 million for a five-year term at a fixed annual rate of interest of 3.1% per annum. Total bank and mortgage debt was $282.2 million at March 31, 2020. Our bank debt and at a working capital was $117.1 million at the quarter end, a 12% decrease from December 31, 2019. Our bank covenants consist of maximum senior debt to trailing 12-month bank-to-fine EBITDA of three times and minimum bank-to-fine EBITDA to interest expense of three times. At March 31, 2020, the company's senior banks debt-to-bank capital ratio was 2.18, and the bank interest coverage ratio was 8.66 times.
spk02: Thank you, Yulia. 2020 began on a relatively positive note compared to 2019. However, as everyone knows, things rapidly changed with the outbreak of COVID-19, particularly after March 11th. when the World Health Organization declared COVID-19 to be a global pandemic. Measures taken in response to the pandemic gave rise to a sudden and substantial decline in economic activity and, consequently, global oil consumption. At the same time, Saudi Arabia and Russia engaged in a battle for market share in global oil markets with devastating consequences for near-term oil prices. The Canadian energy industry was particularly vulnerable to the dual shocks of the COVID-19 pandemic and oil price war, given structural price discounts due to the lack of oil pipeline capacity necessary for Canadian oil to reach Eastern Canadian and global markets. COVID-19 has arguably resulted in the most challenging operating environment ever experienced by Total Energy. North American drilling and completion activity has decreased significantly since March. While Australian activity has not yet been materially impacted, we are monitoring industry conditions there closely. As we navigate through uncharted waters, our top priority is the health and safety of our employees, other stakeholders, and the public at large. We were quick to implement protocols throughout our global operations to mitigate the spread of the virus. and I'm pleased to advise that we have had no reported cases of COVID-19 infection in any of our operations to date. As summarized in our first quarter news release, Total Energy has made unprecedented adjustments to its North American cost structure in order to protect our balance sheet and financial liquidity. These adjustments, which will take full effect during the second quarter, will substantially lower our cost structure and preserve our equipment fleet until such time as industry conditions begin to recover. We recently announced the refinancing of a $40.2 million term loan that matured at the end of April with the new $50 million five-year term loan bearing interest of 3.1%. Such loan is secured by approximately 45% of total's real estate based on net book values at the end of 2019. and illustrates not only the confidence our banks have in total, but also our ability to leverage our significant real estate portfolio to enhance our liquidity and lower our cost of capital. Given the severity of the current downturn, we expect a substantial increase in bankruptcies and insolvencies in the energy service industry, as such industry goes through what we believe will be a historic process of rationalization and consolidation. The basic economic laws of supply and demand are driving this process, and while it will be brutal and negatively impact many stakeholders, it is also necessary to ensure the future sustainability and economic viability of the industry. Total would not be successful without the efforts and support of our employees, owners, and other stakeholders. While we regret the job losses and the suspension of our dividend, we're grateful to our remaining employees who are working harder for less pay and without complaint. The understanding and support of our owners and bankers has allowed management to remain focused on running our business and the established relationships we have with our many customers and suppliers are critical as we work together to get through these challenging times for our industry. Total Energy has demonstrated over its 24 year history its ability to successfully navigate through industry downturns. The current downturn has once again put our company to the test. Our discipline during better times, together with the focus measures we have taken thus far to adjust our cost structure, our geographic and business diversification, and the strength of our relationships with key stakeholders gives us confidence that Total will not only pass its latest test, but emerge as a stronger and more significant player in the global energy services industry. I would now like to open up the phone lines for any questions. We will now begin the question and answer session. To join the question queue, you may press star then 1 and a cell phone keypad. You will hear a tone that's on your request. If you do not speak the phone, please pick up your handset before pressing any key. If you would like to ask a question, please press star then 2. We will pause for a moment as callers join the queue. The first question is from John Brzezinski with California Genuity. Please go ahead. Hey, good morning, everybody. Good morning, Mr. Bears, Nicky. Hey, just looking at CPS, you know, it looked like sequentially revenue was pretty flat, but the margins were up. Was that a function of revenue mix or cost containment, maybe a bit of both? Definitely revenue mix. I think, you know, you had – Increase in rental revenue obviously is evidenced by the increase in horsepower on rent, which tends to be higher margin. You know, an element of cost control, but, you know, as I mentioned, a lot of our cost control impact will be felt in Q2. There is some within Q1 for sure, though, but revenue mix with some cost control. Got it. And still within CPS, looking at your overall inventory at the end of the quarter, $913 million, is the majority of that still within CPS, and do you think you can convert some of that into cash during the coming quarters? Yes. As Julia mentioned, we believe that Q1, March 31 inventories will be at or near peak, and we expect that to begin unwinding beginning Q2 over the balance of the year. Got it. And then just lastly on the Orphan Well Fund, I know I think there was some mention of it in MD&A. Can you give us a little more color on how you think it could touch your businesses here going forward? So there's two kind of components to abandonment. There's the Orphan Well Association, the OWA, which our well servicing group has done a lot of work for historically. They're receiving... $200 million from the federal government as part of that $1.7 billion abandonment program, plus the Alberta government had announced about a month or two earlier an extra $100 million. So that's separate from the billion dollars that has been given to the provincial government by the feds for abandonment activity, which will be non-OWA work. And then there's $400 million to the Saskatchewan government and $120 million to the D.C. government. We expect that to be a pretty significant driver of well service rig activity over the next several quarters. And, you know, being a fairly large well service company in Western Canada, we expect to, you know, benefit from that activity. We also are seeing good opportunities for our rental and transportation services group to participate in those activities as well. So, you know, tough to give forecasts, but I would simply say we have no reason to believe that we wouldn't get our fair share of activity there. Really, I think the limitation for use of those funds will be more service provider capacity than demand from operators to complete abandonment work. Got it. That's great color, Dan. Thank you. That's it for me. Thanks. Thanks, John. The next question is from Jim Monticello with Altacorp Capital.
spk01: Hey, good morning, everyone. Good morning, Tim. John touched on some of my questions here in the CPS But I was just wondering if you could give a little bit more color around the standby revenue you received in Australia, if that was in the drilling segment or in the well servicing segment, and if you expect to see any of that in the forward quarters.
spk02: So Q1 is typically their wet season in Australia. It's kind of the breakup. It's a little bit like breakup in Canada, although not having the same consequences. You know, they saw a wetter Q1 than normal. Our standard arrangements with customers were paid standby, you know, when rigs are not able to operate due to wet weather. I think the big difference this year was our group, our managers and employees there did a much better job on the cost control side perhaps than prior years. You know, certainly it was a wetter year than last year, but the biggest difference wasn't any change contractually. It was cost management.
spk01: Oh, okay. So the motors and quantum, do you have a range of what those standby fees might have been in the first quarter? We do, but we don't disclose that.
spk02: Okay. I think really it's really irrelevant. I think at the end of the day – Conceptually, standby is intended to compensate you for the cost of having to be on standby. To the extent you can better manage, it's like any business. If you do better on cost management, you can get better margins. Really, theoretically, it's irrelevant whether a rig's actively drilling or on standby. Sometimes you can do worse with standby because you get complacent and don't manage your costs.
spk01: Okay, gotcha. And then I guess just more ideologically or just from a macro standpoint, the Australian market, do you expect to see that market come off from where it is today? Obviously, it's been relatively flat. I don't know if that has to do with offtake for the LNG or a version of the COVID method in the region, or is that more stable through the cycle, or do you see that that's just sort of a later thing to fall?
spk02: Well, our exposure is to the gas side. Certainly there's oil activity in Australia, and while we don't have any direct exposure, certainly we're hearing anecdotally the oil side is being hit more. just like it is elsewhere. Obviously, we're washing the market carefully. Domestically, there's gas shortages in Australia. I think there's an underlying relatively healthy gas market there. Obviously, the LNG markets globally are another variable. Again, I think it comes down to company specific producer-specific circumstances, what are their take-or-pay obligations, all that sort of thing. And, again, I wouldn't comment on third parties' businesses there. You know, we do know that we're going to have a couple drilling rigs come off for Level 4 certifications this year. You know, we've been running that pretty hard, so we will have some natural decline. That's not Yulia, so I'm not sure. It's interesting with the home office thing, we've heard a lot of noises over the last couple of months. It's entertaining, but haven't heard any screaming kids yet, so that's a good sign. Anyways, back to Australia. We do know we're going to have a couple drilling rigs come up for Level 4, so those will be out of service, but that's ordinary course.
spk01: Okay. Okay, so those will come down for, what, maybe a month or so? Or does it take longer?
spk02: Yeah, you know, we'll give updates when we know, timing, TBD, and that, but that's just normal course business. But so far, we haven't had any... And like I said, the big thing is ensuring, you know, our workplace is infection-free, and that's been a big part of, you know, our ability to keep operating is that we've demonstrated we can protect our workers.
spk01: Okay. Another one is just on the cost rationalization. I mean, the margins were pretty strong in the first quarter. How much more cost do you think you can expect to take out, maybe on a fixed cost basis, or any color you can provide?
spk02: We gave a pretty general high-level summary in our news release of things we've done. That will generally hit in Q2. So I'm not going to give forecasts, but what I would say generally our objective is to come through this downturn. Our goal... living within existing bank covenants, which our bank covenants are some of the tightest out there. You know, when we first took Savannah over, we had up to five times banks signed EBITDA to debt. That came down to three. And our goal is to work within that. Now, obviously, I'm not going to give forecasts, but we're working hard to get through this without having to adjust anything.
spk01: Okay. That's helpful there, too. Okay, I'll turn it back to you. You're welcome. Thank you.
spk02: The next question is from Ian Goose with Steeple. Please go ahead. Good morning, everyone. Good morning, Ian. Historically, total has been inquisitive counter-cyclically through these bottoms. Can you maybe provide some thoughts around your desire to add more capital into the fleet given the underutilized assets and perhaps how you're thinking about available capacity in the context of your bank debt and where to share prices and perhaps whether, I mean, acknowledging you want to stay within covenants or perhaps you look for some sort of relief to include any sort of pro forma acquisitions? Sure, good question. I think there's a lot of variables at play there. First of all, for whatever reasons, total does not have a cost of equity advantage in the current market. We've been hit like everyone else, and our cost of equity is extremely high. You know, I think the refinancing of our mortgage debt illustrates the marginal cost of our debt, remains quite attractive. You know, so practically the cost of equity is going to force us to be creative in how we are able to accomplish any transactions. We're pretty actively looking. I would say a few things. First of all, we've never had historically issues financing acquisitions. And I wouldn't expect that to be the case this go-around. You know, how we do it, I think, would be tailored to the uncertainty and the uniqueness of this current downturn. But, you know, I've got lots of different ideas as to, you know, our board and Yuli and her group. So capital generally won't be the constraint. I think we've seen a lot of – We've seen a lot of bankruptcies and insolvencies in the last month that are accelerating, particularly within the rental and transportation segment and the well servicing segment. We are seeing a lot of assets that are not physically in good condition, and we've declined to bid on a number of situations strictly based on asset quality. That will be the key determination in our minds as to whether we're willing to do a transaction on will be underlying asset quality. That said, there's also a lot of financial partners within these groups that have capital stock. And so I think really at the end of the day, those capital providers, whether they're banks, private equity firms, or others, are going to be looking really to consolidate assets under strong managers. And the financing is really already in place. And I think I would just conclude by saying any deal that we do will benefit our owners going forward. It will not put our company at risk. And we're not going to, no one will be getting a windfall on the way out. To the extent there are windfalls, it will be, following our ability to complete, digest, integrate, and realize profits from the acquired assets. Okay. That's helpful. And then perhaps on the U.S. outlook, I mean, there appears to be a bit of a divergence in performance between the rentals business and the drilling business. As you think about that, is there any way you can perhaps leverage some of that rentals business into the drilling business, or is there any steps you can take to perhaps move them more closely in line, acknowledging how challenging the current operating environment is? First of all, I think there's a bigger question here. In Canada, what we saw, which was similar to the U.S., ironically, the stronger market in Q1 was on the shallower rigs in both countries. Now, You know, over the last 10 years, you think about the North American drilling industry, where's all the capital gone? It's been building triples. Really, Savannah was the last major rig company to engage in a significant singles build, and they spent a lot of money doing that. You know, there was, before we acquired them, two write-downs, and effectively a write-down when we acquired them. Same thing on the doubles side. And there's also a reason why over 24 years total could never justify building a new triple. You know, we've been running economics on triples for 22 years, and they never made sense to us, even the best of times. I think what we're going to see during the current downturn is what happened to the singles and doubles over the last 10 years happened to the triples. And, you know, it's one thing to generate cash flow. It's another to generate a return on invested capital. And I don't believe triples historically have provided economic returns to their owners. So I expect the part that's going to get hit the hardest in this downturn will be the heavier end of the market. So looking at our U.S. drilling, what we did see, And we have a competitive cost basis on our triples, but we saw what we've seen on the singles and doubles over the last five years start to happen with the triples. And we decided to stand on the sidelines and not wear our equipment out when the spot market was declining rapidly. And so the rest of the industry is take or pay contracts expire or you know, operators are not able to fulfill the terms, you're going to see that if this downturn continues for any length of time, really hit the deep end of the market. And we will probably see the market adjustments to carrying values happen that already have happened in this shallower end of the drilling rig fleet. So there's nothing... There's nothing... idiosyncratic to total on the drilling side. To the contrary, I think the heavier end of the fleet is going to take some write downs. And the question then becomes whether the market conditions are there for groups like total or others to consolidate triples at prices that make sense on a go forward basis. And so stay tuned. I see from our own side, a lot more downside to our deeper end of the rigs than I do on the shallower end of the rigs. The other thing we saw in the U.S., beginning in Q4, accelerating into Q1, was shrewd operators understanding that you don't need a shotgun to kill a gopher. And so we saw increased demand for our shallower rigs relative to our deeper rigs. And typically these were private companies that didn't care about IP rates. They cared about return on capital. I've spoken to certain of them. And these are shrewd operators that were running singles in West Texas, drilling vertical wells. And the only reason they're down right now is because there's nowhere to put their oil. But I can tell you their cost per barrel is materially lower than groups that are drilling three-mile laterals. It's not sexy, but when you get a payout on your well at $40 oil in less than a month, you're going to be drilling those all day long. And I'm told by some of them, the only reason they're down is there's nowhere to put their oil. So it'll be interesting to see operator behavior going forward as well. That's useful context. And the last one for me, I mean, with resizing of the rentals basis, Are you seeing much of an opportunity for, I guess, real estate sales in any of these areas? Just given, I mean, the realized value could be higher than book value and perhaps it's a funding avenue. Is there anything we should be thinking about in that sense, or do you want to hold on to all that stuff in case we require your data ad? Well, listen, everything's for sale for the right price. But what we've done, first of all – we're leasing some of our real estate out to third parties. We're also displacing leased with owned, particularly relocating our gas compression operations from leased to owned. And so there's an underlying shift that doesn't really, it's not apparent. The other thing is we're utilizing it to, I call it kind of our permanent debt on the balance sheet between the 50 million now that we've got on on the renewed mortgage. And then, you know, when we acquired Savannah, there was a roughly $16 million mortgage, which is now 14 and change. You know, to me, that's permanent debt. And certainly you can always do a sale lease back if you wanted to, but there's an operating cost advantage for us to owning that. And like I said, we're utilizing this real estate right now through all divisions. And so something that may have been an RTF, branch six months ago is now, you know, between our contract drilling and CTS segments being used, you know, we did note that we're temporarily idling a significant portion of our North American heavy truck fleet. You know, we have good secure storage for that, that on a cash basis costs us nothing. You know, I can tell you theft and vandalism is a huge issue. And, you know, you can minimize that by having good secure storage, which we do, and it doesn't cost us anything on a cash basis. So, you know, we have sold some real estate over the past couple of years. You know, we'll continue to do that when it makes sense, but we're also – it's a valuable asset for us that we're currently using, and it's serving us well. And our cost base on this is very low. You know, a lot of it was acquired decades ago. Okay. Thank you very much. I'll turn the call back over. Thanks. Once again, if you have a question, please specify them once. The next question is from John Gibson with PMO Capital Markets. Please go ahead. Good morning, guys. I just have one, and I apologize if you've already touched on it, but I'm just wondering about bidding activity and compression, and just wondering if, you know, did customers kind of get, you know, the panic button here early on with COVID-19, and have things stabilized somewhat, or any sort of call you can give on that? We'd appreciate it, thanks. You know, bidding activity actually has remained relatively strong. Now, you know, how much of that is based on people trying to justify their existence, right? I guess we'll see, but we're reasonably constructive on gas. I think we've seen a stabilization in the backlog here over the past couple of quarters. I think as the economy opens up, that's certainly a positive. The bid activity has been steady. you're seeing a migration to better credit, more midstream, you know, infrastructure players, but also, you know, there's still producer activity, you know, particularly in key areas that are deficit positions on infrastructure. So, you know, we're not going to give a forecast, but it's healthy to see a stabilization. It's healthy to see some strength in the gas markets. And, you know, I guess we'll see what the remainder of the year looks like. But we're also seeing a lot of stress, particularly on the U.S. side with major competitors. And, again, you know, we saw that in Canada over a decade ago where we went from number seven in Canada quickly to number two just through attrition and consolidation and bankruptcies. And I think – There's the potential for that to happen in the U.S., where we continue to gain some significant market presence more through attrition. Okay, great. Thank you for the call. I'll bring it back. Low cost always wins in a commodity business. This concludes the question and answer session. I'd like to turn the conference back over to Mr. Denny. I'd like to turn it over to Mr. Mark. Well, thank you, everyone, for calling in. I hope everyone is doing well and your families are safe and healthy. And thank you for participating. We'll look forward to speaking with you after our second quarter. Have a good day. This concludes today's conference call. You may disconnect your lines. Thank you for participating, and have a pleasant day.
Disclaimer