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Operator
Welcome to the Total Energy Services second 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 signal an operator by pressing star and zero. I would now like to turn the conference over to Daniel Halick, President and CEO. Please go ahead, sir.
Daniel Halick
Thank you. Good morning and welcome to Total Energy Services' second quarter 2021 conference call. Present with me is Yulia Gorbache, Total's VP Finance and Chief Financial Officer. We will review with you Total's financial and operating highlights for the three months ended June 30th, 2021, and then provide an outlook for our business and open up the phone lines for questions. Yulia, please proceed.
Yulia Gorbache
Thank you, Dan. During this conference, call, information may be provided containing forward-looking information concerning Total's 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's forward-looking statement due to a number of risks, uncertainties, and other factors affecting Total's businesses and the oil and gas service industry in general. These risks, uncertainties, and other factors are described under heading Risk Factors and elsewhere in Total's most recently filed Annual Information Form and other documents filed with Canadian Provincial Securities Authorities that are available to the public at www.crr.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 information in this conference call is presented in Canadian dollars. Total Energy's financial results for the three months ended June 30, 2021 reflect modestly improving industry conditions in North America and low activity levels in Australia as compared to the second quarter of 2020. Despite the challenging environment, Total reported significant free cash flow during the quarter, generating $16.5 million of cash from operating activities after finding net capital expenditures and $0.7 million of interest expense. Second quarter EBITDA was $19.7 million as compared to $16.7 million of EBITDA in the previous quarter, the first time in total's 25-year history that second quarter EBITDA exceeded first quarter EBITDA. This illustrates not only increasing benefit from geographical diversification of total businesses, but also the improvement in industry conditions, particularly in Canada, given the seasonality of field operations. Total geographical diversification continues to be a stabilizing factor for our financial performance. Geographically, the year-over-year activity levels in Australia declined due to several factors. Activity levels in North America continue to improve from the historic lows experienced during the second quarter of 2020. This is evident by North America contributing 77% of consolidated revenue in the second quarter of 2021 as compared to 60% in the second quarter of 2020. Within North America, the recovery in Canada was more pronounced compared to the United States, with a relative contribution from Canada to consolidated second quarter revenue increasing 12 percentage points compared to Q2 of 2020. Second quarter revenue contributions from the United States increased by 5 percentage points on a year-over-year basis, with Australia's second quarter 2021 revenue contribution decreasing 17 percentage points as compared to 2020. By business segment, compression and process services was the largest contributor to consolidated revenue, generating 40% of 2021 second quarter consolidated revenues, followed by the contract drilling services at 30%, while servicing at 23%, and rental and transportation services contributing 7%. This compares to Q2 of 2020 when CPS contributed 43% of consolidated revenue, while servicing 30%, contract drilling services 20%, and the RDS segment 7%. While second quarter 2021 consolidated revenue increased 20% as compared to Q2 of 2020, EBITDA adjusted to exclude COVID 19 relief funds, and unrealized foreign exchange gains on translational intercompany working capital balances increased by 18%, resulting in higher adjusted quarterly EBITDA margin of 12% as compared to adjusted EBITDA margin of 11% in the second quarter of 2020. Included in Q2, EBITDA was $0.6 million of one-time equipment reactivation costs. The $8.1 million of various COVID relief funds recorded during the second quarter of 2021, including forgiveness of $2.5 million of Patriot Protection Program in the U.S. received in 2020 reduced cost of services by $7.3 million and SG&A by $0.8 million. Consolidated gross margin percentage for the second quarter of 2021 was consistent with Q2 of 2020, 26%. Excluding COVID-19 relief funds and $0.6 million of equipment reactivation costs, the gross margin was 18%, which was consistent with Q2 of 2020. Selling general and administration expenses for the second quarter of 2021 increased by $0.3 million of 5%, compared to Q2 of 2020, as employee compensation was reinstated to pre-COVID levels during the quarter. The improvement in North American drilling activity had a positive impact on the second quarter operating days and utilization in total CDS segment and drove the 82% increase in CDS's second quarter revenue compared to 2020. Market share gains in the United States contributed to tenfold year-over-year increase in the second quarter U.S. operating days, which in turn resulted in the U.S. contributing a majority of the year-over-year increase in CDS segment revenues. Of setting increases in operating days was lower revenue per operating day due to changes in the geographic and equipment mix. While second quarter operating days were lower on a year-over-year basis in Australia, they increased 32% from Q1 of 2021, with a reactivation in late April 2021 of the first of two drilling rigs that were taken out of service in Q3 of 2020 for recertification and upgrade. Adjusting for 0.6 million of one-time rig reactivation costs, the CDS segment realized 185 year-over-year increase in the second quarter EBITDA. With improving industry conditions, and the commencement of several major projects in Canada that were previously delayed, the RTS's equipment utilization increased 60% in the second quarter of 2021 compared to Q2 of 2020, which was partially offset by a 21% decrease in revenue per utilized piece due to changes in the mix of equipment utilized and lower pricing. Second quarter RTS revenue increased 27% on a year-over-year basis, which in turn drove a 102% increase in segments EBITDA after excluding the gain on sale of equipment during the quarter. The RTS segment has significant leverage to high activity levels given its significant fixed cost structure. Second quarter revenue in total compression and process services segment increased 11% compared to 2020-2021. and this segment saw an increase in its fabrication sales backlog for the third consecutive quarter as improving global economic and natural gas fundamentals began to stimulate capital investments. Relatively strong North American natural gas prices also provided the support for CPS's fabrication sales and equipment overhaul activities. Quarterly utilization of the compression rental equipment fleet began to recover in the second quarter, increasing 21% from the first quarter of 2021. Segment EBITDA for the second quarter of 2021 increased 31% on a year-over-year basis as a result of ongoing cost management and the receipt of COVID-19 relief funds. Compared to 2020, second quarter revenue decreased 10% in our wealth servicing segment, While service hours increased 3% during the second quarter, the revenue per service hour decreased 13% due to primarily to the geographic revenue mix and lower pricing in the U.S. The continued recovery in oil prices and increased abandonment activity in Canada contributed to a substantial increase in activity in North America that was partially offset by lower utilization in Australia. This segment's EBITDA margin decreased 3 percentage points in the second quarter of 2021, as compared to the same quarter of last year, due primarily to cost inflation in North America that was not recovered through price increases. Total Energy's financial liquidity positions remain very strong. At June 30, 2021, the weighted average interest rate on outstanding bank debt was 2.75%, as compared to 2.96% at June 30 of 2020. This lower interest rate combined with lower outstanding debt balances contributed to a 30% year-over-year decrease in the second quarter finance costs. Total net debt position at June 30, 2021, is the lowest since we completed the acquisition of Savannah in June of 2017, as we remain focused on the continued repayment of debt. Total energy exited the second quarter of 2021 with over $142 million of liquidity consisting of $29.2 million of cash and $113 million of available credit under companies revolving credit facilities. Total energy Bank governance consists of maximum senior debt to trailing 12-month bank-defined EBITDA of three times and a minimum bank-defined EBITDA to interest expense of three times. At June 30, 2021, the company's senior bank-to-bank EBITDA ratio was 1.87 and the bank interest coverage ratio was 11.93 times. Thank you, Yulia.
Daniel Halick
Despite continued global economic and market uncertainty with the sustained increase in oil and natural gas prices, North American industry conditions began to recover during the second quarter of 2021 from the historic lows following the COVID-19 outbreak in March of 2020. Second quarter industry activity levels in Australia were lower compared to 2020 due in part to wet weather conditions that restricted field activity but they increased modestly from the first quarter of 2021. While industry activity remained well below pre-COVID levels for the first half of 2021, after changes in non-cash working capital items, total generated over $41 million of pre-cash flow after funding our capital expenditures and paying interest charges. This substantial free cash flow was used in part to repay $29.3 million of bank debt. We also began to return capital to our owners with $2.3 million of share buybacks during the first half of 2021. North American drilling activity has continued to increase in the third quarter, particularly in Canada, where the number of wells drilled in July was approximately eight times higher than July of 2020. Total currently has 16 rigs drilling in Canada, and additional rigs are expected to begin operations over the next several weeks. While the overall land rig count in the United States has not recovered to the same extent as Canada, market share gains have seen Total's current active rig count at 2019 levels, with eight of 13 rigs currently operating and a ninth rig moving on to location as we speak. In Australia, the second of two rigs removed from service in Q3 of 2020 for recertification and upgrades commenced drilling in late July, such that four of five rigs are currently operating as compared to two rigs at the beginning of 2021. Higher drilling activity is driving increased demand for the equipment and services provided by Total's other business segments. including our RTS segment, which has significant leverage to higher activity, as Yulia mentioned earlier. Industry rationalization and reduced maintenance spending over the past several quarters is expected to lead to certain equipment shortages should demand for such equipment continue to increase. Increasing activity levels may also give rise to human resource challenges, particularly in Canada, where a multi-year downturn has caused many experienced workers to leave the industry. The fabrication sales backlog and total energies compression and process services segment increased for the third consecutive quarter, and multi-year high natural gas prices are providing tailwinds for quoting activity. The CPS segment's extensive inventory of major components, notably large horsepower Caterpillar engines, positions our business well as supply chain issues begin to weigh on timely access to such components. Further, as fabrication sales activity continues to recover, such inventory will be converted to cash, thereby mitigating the normal working capital demands associated with increasing business activity. In reflecting over the past 18 months, We are proud to have navigated through the most difficult industry downturn ever faced in our 25-year operating history. We are particularly proud of our investment track record in a highly cyclical industry, as we have never recorded an impairment in respect of any of our acquisitions or capital assets, including goodwill. We are also proud of the fact that Total has never been required to renegotiate its banking covenants. These successes are due to our absolute commitment to our core principle of capital discipline. The relative attractiveness of share buybacks as a use of our owner's capital serves to reinforce our commitment to capital discipline. That said, we have never shied away from using our financial strength to pursue compelling investment opportunities as evidenced by our board's approval of a $13.1 million increase to our 2021 capital expenditure budget. Finally, I'm pleased to welcome Jessica Kirstein to our Board of Directors. Ms. Kirstein not only brings extensive upstream oil and gas industry experience to Total Energy, but she will also provide a unique and valuable perspective on existing and future energy infrastructure challenges and opportunities. Management look forward to benefiting from Jessica's insight and guidance as we strive to continue to provide innovative and efficient equipment and service to the global energy industry. I would now like to open up the phone lines for any questions.
Operator
We will now begin the question and answer session. To join the question queue, you may press star then 1 on your telephone keypad. You will hear a tone acknowledging your request. If you're using a speakerphone, please pick up your handset before pressing any keys. To withdraw your question, please press star then 2. We will pause for a moment as callers join the queue. The first question is from Cole Pereira from Stifel. Please go ahead.
spk02
Good morning, everyone. Good morning, Cole. Good morning. Dan, you kind of touched on it a little bit, but as we think about capital allocation, can you maybe add some color how you're thinking about other priorities, namely resuming the dividend or potential M&A?
Daniel Halick
So first and foremost, I would say that the benchmark for evaluating any capital expenditures would be how those opportunities stack up against share buybacks. And right now that hurdle is extremely high. So I would expect you'll continue to see us be fairly steady and methodical on reducing our share count. That said, We are seeing some opportunities here. I would call them rifle shots as opposed to shotgun blasts, notably in our contract drilling business where targeted upgrades that are being requested by customers and for which we're receiving additional compensation, we're pursuing those opportunities. On the M&A front, we've been busy evaluating a lot of different opportunities The reality is our cost of equity right now is a significant challenge to make any of those work for our existing shareholders. But those things can change quickly and so we're constantly modeling and updating various opportunities and if something makes sense, we'll move on it. We were one of the, I would say, the early movers in the belief that industry consolidation was necessary and and we remain firmly of that view today.
spk02
Okay, perfect. That's helpful. Thanks. So the CPS backlog obviously looked very strong, and you kind of touched on it a little bit in your prepared remarks, but can you just maybe give some more color around how you see that growth trajectory for that business playing out in the remainder of the year?
Daniel Halick
You know, as I mentioned earlier, Natural gas prices globally and including in Canada are at multi-year highs. That's obviously a positive for this business. They are providing strong tailwinds for coating activity which we're continuing to see increasing conversion from coating to firm orders and I would say that's continued post June 30. Again, we're reluctant to give guidance, but I would say the trend towards continued strong coating and increasing conversion to orders continues today. Strong gas prices will only help that. Combined with there's various opportunities that are unfolding over the next while, coastal gas link, things like that, that will reinforce demand for the equipment that CPS produces.
spk02
Okay, perfect. That's helpful. Thanks. That's all for me. I'll turn it back.
Operator
Thank you. The next question is from Joseph Schachter from Schachter Energy Report. Please go ahead.
Joseph Schachter
Good morning, Dan. Good morning, Julia. A couple of issues. Going back to the issue of the dividend, what do you need to see before you, because your debt load is getting down to, you know, quite low levels. So the question is, how low do you want that to go before you then have more cash? And the question is, can you give me a little insight of how you picture stock buybacks versus maybe reinstating some portion of a dividend?
Daniel Halick
So first of all, a dividend declaration is the decision of our board, so I would defer to the entire board. But my own perspective as head of management would be as long as we're able to buy our shares for substantially below the net book value of our equity per share, that's a very compelling opportunity. And so the current market price is significantly below the equity value or the equity book value per share to the point where it's even less than the paid up capital. per share. And, you know, it's an interesting, we've never seen this before on any sustained level. And so it's interesting in the sense that if we're paying below our paid up capital per share, we're actually adding back to retained earnings on the difference between the paid up capital per share, less what we paid for the shares in the open market. So until we're closer to our market price of our shares being equivalent to our book equity per share, I would suggest that we'd be foolish to reinstate a dividend over deploying that capital to reducing our share count.
Joseph Schachter
The offset, though, is, of course, liquidity stops or dries up a lot in terms of number of shares trading. But let's go to the other issue is... With the increasing demand, as you mentioned, the higher natural gas prices, liquids are being very important for many of the money players. What do you see in terms of your discussions with the companies on the NP side in terms of pricing and then having equipment availability? And then do you have enough manpower lined up so that if you do see a pickup in business in you know, in the coming months that you have the ability to man the equipment?
Daniel Halick
So on the pricing front, we are pushing pricing as the industry generally is on all fronts, and we are starting to get some traction there. I think our customer base generally understands the, first of all, the pricing that was in place, you know, coming in, Over the past 18 months, it's certainly not sustainable, and one only has to look at the balance sheets of public energy services companies to confirm that. As well, there's been cost inflation. Again, look at the gas pumps. That is a starting point for inflation. So we have been implementing price increases, again, for competitive reasons. I won't get into a lot of detail. But certainly, we're seeing a... particularly in Canada, a very different dynamic than what we've seen over the past six years, in large part due to supply destruction. And so there's always a few customers that want to micromanage what you're charging, but we're seeing that we're going to start shifting our customer base in response to... where we get the best price, and that's out of necessity because you touched on it, labor. So far, we're fine on labor, but as things increase, we expect, and I think we're starting to see increasing pressure and challenges to attract people back to the industry. And again, for competitive reasons, I won't break it down segmentally, but we're not going to incur higher costs to bring people back to work at... COVID-level pricing. And the other thing that our industry generally has to deal with, and we're proactive on this, is the end of queues in Canada over the next couple of months. And that will, I think that program, well, I know that program did what it was intended to do, which was sustain employment that otherwise may not have been survive this downturn, but that'll be over. And, you know, we've been always running our business on the theory that we have to be prepared for the end of that. And, you know, that requires, particularly with cost inflation, price increases, and that's a common direction that we're giving to all of our divisions. in all jurisdictions is pricing and we model that closely and we know where we need to be and that's being rolled out within the context of being competitive in the marketplace.
Joseph Schachter
One last one for me. Are there any basins that are getting better sufficiently for you to get those pricing increases so that you have the ability to get that better operating margin? in Canada, space, Australia, maybe just walk around the world, just see where you see the opportunities on the upside near term?
Daniel Halick
Well, I think there's, within our various business segments, there's kind of micro markets, both geographic and equipment lines. And we are already seeing equipment shortages in certain micro markets. In other micro markets, we're the only ones left. particularly in our rental and transportation segment. And so it's going to be an interesting back half of the year as these micro markets play out and we allocate scarce resources to markets that are bidding the highest price. And again, for competitive reasons, I'm not going to get into geographic or equipment lines. But, you know, I expect that it's actually, we're starting to see the tide is going out and there's been a lot of damage done to the North American energy service industry. Some segments more than others, but if the rig count continues to increase, we're going to see that come out loud and clear in terms of demand. the bottom line of energy services companies that have survived and are in a position to deploy equipment.
Joseph Schachter
Super. Well, best wishes for the best of the year. Thank you very much.
Daniel Halick
Yeah, and that's all predicated, Joseph, on relatively stable oil and gas prices.
Operator
For sure, yeah.
Daniel Halick
Thanks very much.
Joseph Schachter
Thanks.
Operator
As a reminder, it is star one to ask a question. The next question is from Ernest Wong from Baskin Wealth Management. Please go ahead.
Ernest Wong
Hi, good morning, Dan and Julia.
Daniel Halick
Good morning, Ernest. Good morning.
Ernest Wong
I was just wondering if you guys could talk a little bit about the emerging applications that you're working on at OBSCO, and which of these, such as the small-scale LNG plant or helium drilling, do you think could be material in the near-to-medium term? Thanks.
Daniel Halick
So I would put Opsco together with Bidel. They operate under the ultimate same senior management, and they're very complementary businesses, but definitely unique as well. Certainly, Opsco is more focused on the liquids and solid side of things, where Bidel, obviously, on the gas side. Again, a lot of these emerging opportunities, such as hydrogen or... There's a lot of chatter. You know, we'll see where that leads. You know, my primary concern on opportunities there is ensuring we get paid. But we are currently building some interesting things. And again, I'm not going to, I would say right now, generally within North America, these are for competitive reasons. I'm not going to disclose the location, but, you know, we're building some equipment for, I'd call it waste gas. agricultural waste gas or methane capture. We've been working with a private company who has developed small-scale LNG plants that I think will have a very interesting application in more remote locations for basically liquefying natural gas to displace diesel. We've been supporting that private company with some with technical and I would say, you know, their prototype plant is in OBSCO's yard and so we work with them to showcase the technology and ultimately, you know, as that is deployed to the field, you know, we would hope to be the ones building it given that we built the prototype. You know, again, we're involved in... in various LNG projects in North America. The Coastal Gas Link and LNG Canada, again, we expect to be involved both with OBSCO and BIDEL, both in, you know, particularly in field infrastructure that's absolutely required to support feeding that terminal. Interestingly, we're also pretty involved on the pipeline side with our rental transportation service side, which we're active on the Trans Mountain pipeline project, providing various services and equipment from our RTS segment, which, again, that's an area that we hope to see increasing involvement within the RTS segment over the next while as various projects are commenced. So all in all, you know, Natural gas compression and processing around that continues to be the largest part of our business, but there's definitely some unique emerging opportunities that as capital is deployed there, we're at the front of the line. As far as anyone, we're developing relationships and partnerships with companies that we've never been involved with before to help them engineer, design, and ultimately look to pursue those construction opportunities. So that'll play out as these things become reality if they do. And, you know, at the end of the day, we're agnostic. You know, gas is gas. The chemistry is different. So you acquire different, you know, engineering and materials. But, you know, handling methane or hydrogen or helium or whatever, you know, the The bottom line is that's what we do, and so we're really agnostic in terms of what gas is being produced or stored or transported. We can do it all. And the addition of Ms. Kirstein to our board was part of our, I'd call it, 30,000-foot strategy to ensure we have leading-edge perspective on gas. on infrastructure opportunities, including carbon capture, which, you know, OBSCO has been very involved with over the past 30, 40 years. And, you know, Ms. Kirstein will bring a unique perspective on those types of opportunities given her role at TC Energy. Sounds exciting. Thanks. Thank you.
Operator
The next question is from Tim Monachello from ATB Capital Markets. Please go ahead.
Tim Monachello
Good morning, Tim. Hey, good morning. I was off the call for a second there, so apologies to have been asked, but I'm just wondering if you could talk a little bit about the labor dynamics you're seeing across your markets and how you're handling recruitment.
Daniel Halick
Our industry is a cyclical one. We go through this often. I think the difference is Canada. you know, where we've been through a brutal downturn for the past six years. So I would say that would be the most, you know, the market that we're most focused on, you know, as things get busier. You know, the flips currently were not constrained in any of our businesses due to labor, but things continue to pick up. We expect that will, you know, be a challenge. But You know, our industry always seems to find a way to make things work. And so I tend to be an optimist. But what we'll take is assurances to people who've left the industry or people we want to attract that are new to the industry of steady work and a good paycheck. And so, you know, we're not going to be recruiting people and incurring the expense to train people. you know, for unprofitable business opportunities. So we need to see sustained improving business conditions in order to make the investment that we're going to have to make to enlarge the workforce in various segments. So, again, I tend to be an optimist, Tim. I think we'll get through this, but it's definitely going to be an issue for our industry, particularly in Canada. Okay, got it. And we've been creative. We've kept people... My philosophy is you take care of your core people. Everyone took wage rollbacks, including myself and our board, and everything was reinstated in Q2 as things started to recover. But we've used other methods to keep core people involved, including moving them to other divisions that were busier. And so, you know, we tried our best to mitigate the destruction to our core workforce. Definitely, we had to make some tough decisions, but hopefully, you know, that'll pay off as things continue to recover here.
Tim Monachello
Okay, yeah, that makes sense. There are some pretty significant asset sales in the quarter, almost the extent, well, I guess the extent that it offset all the capex sales. Do you expect to see, you know, similar magnitudes of asset sales as we go forward?
Daniel Halick
You know, those are hard to predict. You know, the one thing I would say, you know, we had our normal, you know, we retired three rigs, salvaged, you know, scrap metal and various component sales there. But those rigs were decommissioned. And again, I think it illustrates our book values are solid. You know, we had some dispositions in our heavy truck fleet you know these were older units that um you know there was pretty strong demand from other industries for for that type of equipment so again you know we called the the fleet a little bit um we always have compression rental purchase option exercises that's kind of normal course there's a bit the unusual i would say um probably not as recurring would have been we sold some access matting in Q2. We had an opportunity for a large, there was a large project and literally we sold those the week that lumber prices hit an all-time high. And, you know, we did okay on those.
Tim Monachello
Okay, got it. Could you speak a little bit about how you see working capital going forward. I understand you have, you know, your inventory levels are fairly elevated compared to, you know, your level of revenue and you're going through a cycle where you, you know, might see some rebuild in backlog, especially in the CPS segment. So how do you see those inventory levels moving as we go through the up cycle here?
Daniel Halick
So, you know, our inventory turns will normalize and improve as fabrication activity increases. Substantially, all of our inventory is within our CPS segment. You know, there's minor inventory levels in other business lines, but substantially all would be in our CPS segment. You know, within that, a good portion is major components, notably CAD engines. And, you know, as I mentioned in my remarks... we're definitely seeing some supply chain issues there and our directive to our CPS segment is we're not going to sell any CAD engines or any major components other than in a fully packaged form that we do the packaging. So as packaging activity increases, you're going to see a normalization of inventory relative to sales and an increase in inventory turns and a reduction, I guess, in an offset to our normal working capital draw that takes place as our payrolls get higher with increased activity. So it's a positive in the sense that should things continue the direction they're going, we will offset a lot of the normal working capital draw with draw down on our inventory and, you know, kind of back of the napkin, you know, if we're at activity levels that I'd call kind of middle of the cycle, we should be running about 60 million, 65 million of inventory. And so that's going back to more of a just-in-time inventory feed as opposed to sitting on significant raw materials as we are now.
Tim Monachello
Do you have line of sight to getting back to that level with your current backlog?
Daniel Halick
We don't give forecasts, so I won't comment on that. I think, you know, we've said in the past that we expected from trough to getting back to kind of mid-level activity levels, which, you know, I'd encourage you to go back and just look at the CPS segment over the past four or five years and you'll get a better sense of the inventory turns. But we've said we would expect kind of that $40 million monetization on inventory if that happens. So the time frame over which that will happen is going to be dictated by activity levels, and I'm not going to give a forecast. But again, if you look at our inventory levels for the past few quarters, they're starting to draw down. Gotcha.
Tim Monachello
All right, I'll turn it back.
Daniel Halick
Thanks, Tim.
Operator
This concludes the question and answer session. I'd like to turn the conference back over to Daniel Halleck for any closing remarks.
Daniel Halick
Thank you for participating in our second quarter conference call. I wish everyone a safe and pleasant summer, and we look forward to speaking with you after our third quarter. Have a good day.
Operator
This concludes today's conference call. You may disconnect your lines. Thank you for participating, and have a pleasant day.
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